GS Financial Corp. Announces Third Quarter Results

GS Financial Corp. (NASDAQ:GSLA), the holding company of
Guaranty Savings and Homestead Association "the Association",
(www.gsha.com), announced quarterly earnings of $231,000 for the
quarter ended September 30, 2005, down 4% from $240,000 reported for
the same period in 2004. Diluted earnings per share for the third
quarter of 2005 were $.20, unchanged from the third quarter of 2004.
   Net income for the first nine months of 2005 totaled $403,000,
down 9% from $445,000 reported for the same time period in 2004.
Earnings per share over the first nine months of 2005 were $.34, down
10% from $.38 in the first nine months of 2004. The results for the
first nine months of 2005 include the one-time recognition of costs
associated with the retirement of the Company's former President and
Chief Executive Officer. These costs totaled $428,000, or $.36 per
share ($282,000, or $.24 per share, after related tax benefits).
Excluding the impact of this one-time charge, net earnings from
operations for the nine months ended September 30, 2005 were $685,000,
or $.58 per share.
   GS Financial's third quarter earnings were adversely affected by
Hurricane Katrina, which struck the Association's primary market area
on August 29, 2005. While the full impact of this event on the
Association's financial condition and results of operation are in the
process of being fully assessed, the Company has included certain
charges in its third quarter results. The following summarizes certain
effects of the hurricane on the Company's operations:

   --  One of the Association's four full service branches suffered
        significant damage to both the building and its contents. As a
        result, the Company has recognized a pre-tax impairment charge
        of approximately $155,000. This branch is expected to remain
        out of service for several months.

   --  The Association has granted its customers a three-month
        deferral of loan payments. Interest continues to accrue on
        these loans; however, late charges are being waived. Loans
        that have become past due more than 90 days as a result of
        this deferral continue to be treated as a performing asset.

   --  The Association continues to evaluate its reserves for loan
        losses in light of the destruction sustained in the area.
        However, at this point, the Association has not completed any
        assessment sufficient to permit it to increase its reserves
        for loan losses and additional provisions may be required in
        the future.

   Despite the widespread damage to the area and the temporary
displacement of Company employees, the Association was able to resume
operations at its main office and branches as soon as civil evacuation
orders were lifted by local authorities.
   Net interest income for the quarter ended September 30, 2005 was
$1.4 million, down approximately $21,000, or 1% from the third quarter
of 2004, and up less than 1%, or $12,000 from the second quarter of
2005. The third quarter 2005 net interest margin was 3.20%, up 29
basis points from 2.91% from the third quarter of 2004, and up 11
basis points from 3.09% in the second quarter of 2005.
   Net interest income for the first nine months of 2005 was $4.3
million, up 6% from $4.1 million in the first nine months of 2004. The
net interest margin for the first nine months of 2005 was 3.10%, up 38
basis points from 2.72% for the same time period in 2004.

   Additional financial information include the following:

   --  Total assets at September 30, 2005 were $181.2 million, down
        approximately 9% from December 31, 2004.

   --  Loans at September 30, 2005 were $84.9 million, down
        approximately 8% from December 31, 2004.

   --  Deposits at September 30, 2005 were $117.5 million, down
        approximately 10% from December 31, 2004.

   --  Outstanding advances from the Federal Home Loan Bank at
        September 30, 2005 were $33.9 million, down approximately 14%
        from December 31, 2004.

   --  Stockholders' equity at September 30, 2005 was $28.7 million,
        down less than 1% from December 31, 2004. Stockholders' equity
        as a percentage of total assets at September 30, 2005 was
        15.84%, up from 14.47% at December 31, 2004.

   --  Non-interest expense for the third quarter of 2005 totaled
        $1.0 million, down approximately 13% from a year earlier.
        Non-interest expense for the first nine months of 2005 totaled
        $3.6 million, up approximately 5% from the first nine months
        of 2004. Included in the first half of 2005 are the previously
        mentioned expenses associated with the retirement of the
        Company's former President and Chief Executive Officer.
        Excluding the impact of this one-time charge, non-interest
        expenses for the first nine months would have been $3.1
        million, down approximately 7% from the previous year.

   --  Non-performing assets were $346,000 at September 30, 2005,
        compared to $894,000 at December 31, 2004. The ratio of
        non-performing assets to total assets at September 30, 2005
        was .19% compared to .45% at December 31, 2004.

   --  Reserve coverage of non-performing assets at September 30,
        2005 was 266% compared to 103% at December 31, 2004. Reserve
        coverage of total loans was 1.07% at September 30, 2005
        compared to .99% at December 31, 2004.

   --  The ratio of loans to deposits at September 30, 2005 was
        72.26%, compared to 70.5% at December 31, 2004.

   FORWARD-LOOKING INFORMATION

   Statements contained in this news release which are not historical
facts may be forward-looking statements as that term is defined in the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements are subject to risks and uncertainties which could cause
actual results to differ materially from those currently anticipated
due to a number of factors. Factors which could result in material
variations include, but are not limited to, changes in interest rates
which could affect net interest margins and net interest income,
competitive factors which could affect net interest income and
noninterest income, changes in demand for loans, deposits and other
financial services in the Company's market area; changes in asset
quality, general economic conditions as well as other factors
discussed in documents filed by the Company with the Securities and
Exchange Commission from time to time. In addition to risks and
uncertainties described by the Company in prior filings with the SEC,
other risks and uncertainties potentially impacting the Company are
those related to the Company in its primary market area impacted by
Hurricane Katrina, including the continuing effect of the storm and
its aftermath on the Company's operating expenses and on the Company's
borrowers and other customers. The Company undertakes no obligation to
update these forward-looking statements to reflect events or
circumstances that occur after the date on which such statements were
made.
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                          GS Financial Corp.
       Condensed Consolidated Statements of Financial Condition

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                                                9/30/2005   12/31/2004
($ in thousands)                               (Unaudited)   (Audited)
----------------------------------------------------------------------
ASSETS
  Cash & Amounts Due from Depository
   Institutions                                    $1,678      $1,613
  Interest-Bearing Deposits from Other Banks        4,331       3,761
  Federal Funds Sold                                2,730       1,650
----------------------------------------------------------------------
  Total Cash and Cash Equivalents                   8,739       7,024
----------------------------------------------------------------------
  Securities Available-for-Sale, at Fair Value     80,834      94,557
  Loans, Net                                       84,901      92,158
  Accrued Interest Receivable                       1,115         596
  Premises & Equipment, Net                         2,380       2,508
  Stock in Federal Home Loan Bank, at Cost          2,150       2,445
  Foreclosed Assets                                   159           -
  Real Estate Held-for-Investment, Net                481         493
  Other Assets                                        443         285
----------------------------------------------------------------------
   Total Assets                                  $181,202    $200,066
----------------------------------------------------------------------

LIABILITIES
  Deposits
   Interest-Bearing Deposits                     $116,459    $129,758
   Noninterest-Bearing Deposits                     1,034         965
----------------------------------------------------------------------
   Total Deposits                                 117,493     130,723
----------------------------------------------------------------------
  FHLB Advances                                    33,937      39,689
  Other Liabilities                                 1,072         710
----------------------------------------------------------------------
   Total Liabilities                              152,502     171,122
----------------------------------------------------------------------

STOCKHOLDERS' EQUITY
  Preferred Stock - $.01 Par Value                     $-          $-
  Common Stock - $.01 Par Value                        34          34
  Additional Paid-in Capital                       34,572      34,425
  Unearned ESOP Stock                                (310)       (521)
  Unearned RRP Trust Stock                           (861)       (865)
  Treasury Stock                                  (32,193)    (32,119)
  Retained Earnings                                28,335      28,286
  Accumulated Other Comprehensive Loss               (877)       (296)
----------------------------------------------------------------------
   Total Stockholders' Equity                      28,700      28,944
----------------------------------------------------------------------
   Total Liabilities & Stockholders' Equity      $181,202    $200,066
----------------------------------------------------------------------

Selected Asset Quality Data
  Total Non Performing Assets                        $346        $894
  Non Performing Assets to Total Assets              0.19%       0.45%
  Allowance for Loan Losses to Non Performing
   Assets                                          265.90%     102.90%
----------------------------------------------------------------------



                          GS Financial Corp.
             Condensed Consolidated Statements of Income
                             (Unaudited)

                           For the Three Months   For the Nine Months
                            Ended September 30,   Ended September 30,
----------------------------------------------------------------------
($ in thousands, except
 per share data)               2005       2004       2005       2004
----------------------------------------------------------------------
Interest and Dividend
 Income                       $2,670(1)  $2,793     $7,980(1)  $8,193
Interest Expense               1,231      1,333      3,674      4,139
----------------------------------------------------------------------

Net Interest Income            1,439      1,460      4,306      4,054
Provision for Loan Losses          -          -          -         33
----------------------------------------------------------------------
Net Interest Income after
 Provision for Loan Losses     1,439      1,460      4,306      4,021
----------------------------------------------------------------------

Non-interest Expense             981      1,129      3,569      3,392
----------------------------------------------------------------------
Net Income Before 
 Non-Interest Income 
 and Income Taxes                458        331        737        629
----------------------------------------------------------------------

Impairment Charge Related
 to Hurricane Katrina           (155)         -       (155)         -
Non-interest Income               39        (85)        71       (181)
----------------------------------------------------------------------
Income Before Tax Expense        342        246        653        448
----------------------------------------------------------------------

Income Tax Expense               111          6        250          3
----------------------------------------------------------------------
Net Income                      $231       $240       $403       $445
----------------------------------------------------------------------
Earnings Per Share 
 - Basic                       $0.20      $0.21      $0.34      $0.38
----------------------------------------------------------------------
Earnings Per Share
 -Diluted                      $0.20      $0.20      $0.34      $0.38
----------------------------------------------------------------------

Selected Operating Data
  Weighted Average Shares
   Outstanding             1,180,635  1,152,393  1,181,436  1,156,409
  Return on Average 
   Assets(2)                    0.50%      0.46%      0.28%      0.28%
  Non-Interest
   Expense/Average
   Assets(2)                    2.12%      2.18%      3.76%      3.18%
  Net Interest Margin(2)        3.20%      2.91%      3.10%      2.72%
----------------------------------------------------------------------

(1) Includes approximately $397,000 of interest accrued on loans but
    for which payments have not been received as a result of loan
    deferrals granted in the wake of Hurricane Katrina.

(2) Annualized
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