The Southern Banc Company, Inc. Announces Third Quarter Earnings

GADSDEN, Ala.--(Business Wire)--
The Southern Banc Company, Inc. (OTCBB: SRNN), the holding company for The
Southern Bank Company, announced a net loss of $66,348, or $(0.08) per basic and
diluted share, for the quarter ended March 31, 2009, as compared to net income
of $20,245, or $0.03 per basic and diluted share, for the quarter ended March
31, 2008. For the nine month period ended March 31, 2009, the company recorded a
net loss of $84,331, or $(0.11) per basic and diluted share, as compared to a
net loss of $113,001, or $(0.14) per basic and diluted share, for the nine month
period ended March 31, 2008.

Gates Little, President and Chief Executive Officer of the Company, stated that
the Company`s net interest margins improved during the quarter as compared to
the same period in 2008. Net interest income for the nine month period ended
March 31, 2009 was approximately $1.6 million as compared to approximately $1.5
for the nine month period ended March 31, 2008. The improvement in the net
interest margin for the nine month period was primarily attributable to a
decrease in total interest expense of approximately $615,000, or 24.6%, offset
in part by a decrease in total interest income of approximately $450,000, or
11.4%. For the nine month period ended March 31, 2009, total non-interest income
decreased approximately $36,000, or 21.2%. The decrease in non-interest income
was primarily attributable to loss on sale of securities of approximately
$30,000.

The Company`s total assets at March 31, 2009 were $99.8 million, as compared to
$102.9 million at June 30, 2008. Total stockholders` equity was approximately
$15.4 million, or 15.46% of total assets, at March 31, 2009 as compared to
approximately $15.1 million, or 14.72% of total assets, at June 30, 2008.

The Bank has four offices located in Gadsden, Albertville, Guntersville, and
Centre, Alabama. The stock of The Southern Banc Company, Inc. is listed on the
OTC Bulletin Board.

Certain statements in this release contain "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995, which
statements can generally be identified by the use of forward-looking
terminology, such as "may," "will," "expect," "estimate," "anticipate,"
"believe," "target," "plan," "project," "continue," or the negatives thereof, or
other variations thereon or similar terminology, and are made on the basis of
management`s plans and current analyses of the Company, its business and the
industry as a whole. These forward-looking statements are subject to risks and
uncertainties, including, but not limited to, economic conditions, competition,
interest rate sensitivity and exposure to regulatory and legislative changes.
The above factors, in some cases, have affected, and in the future could affect
the Company`s financial performance and could cause actual results to differ
materially from those expressed or implied in such forward-looking statements,
even if experience or future changes make it clear that any projected results
expressed or implied therein will not be realized.

THE SOUTHERN BANC COMPANY, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollar Amounts in Thousands)

March 31, June 30,
2009 2008

ASSETS

CASH AND CASH EQUIVALENTS $ 8,928 $ 4,344

SECURITIES AVAILABLE FOR SALE, at fair value 54,183 60,320
SECURITIES HELD TO MATURITY, at amortized cost, fair value of $82 and $100, respectively 77 94
FEDERAL HOME LOAN BANK (FHLB) STOCK 360 328

LOANS RECEIVABLE, net of allowance for loan losses of $198 and $193, respectively 34,814 36,140
PREMISES AND EQUIPMENT, net 929 947
ACCRUED INTEREST AND DIVIDENDS RECEIVABLE 406 508
PREPAID EXPENSES AND OTHER ASSETS 190 207

TOTAL ASSETS $ 99,887 $ 102,889

LIABILITIES

DEPOSITS $ 80,825 $ 84,387
FHLB ADVANCES 3,075 3,075
OTHER LIABILITIES 540 283

TOTAL LIABILITIES 84,440 87,745

STOCKHOLDERS' EQUITY:
Preferred stock, par value $.01 per share 500,000 shares authorized, shares issued and 0 0
outstanding -- none
Common stock, par value $.01 per share, 3,500,000 authorized, 1,454,750 shares issued 15 15
Additional paid-in capital 13,887 13,887
Shares held in trust, at cost, 25,768 shares (571 ) (571 )
Retained earnings 10,523 10,811
Treasury stock, at cost, 648,664 shares (8,825 ) (8,825 )
Accumulated other comprehensive income (loss) 418 (173 )
TOTAL STOCKHOLDERS` EQUITY 15,447 15,144
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 99,887 $ 102,889

THE SOUTHERN BANC COMPANY, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollar Amounts in Thousands, except per share data)

Three Months Ended Nine Months Ended
March 31, March 31,

2009 2008 2009 2008

INTEREST INCOME:
Interest and fees on loans $ 510 $ 550 $ 1,614 $ 1,597
Interest and dividends on securities available for sale 572 788 1,878 2,252
Interest and dividends on securities held to maturity 1 2 5 6
Other interest income 2 23 13 106
Total interest income 1,085 1,363 3,510 3,961

INTEREST EXPENSE:
Interest on deposits 538 801 1,823 2,394
Interest on borrowings 21 43 64 108
Total interest expense 559 844 1,887 2,502
Net interest income before provision for loan losses 526 519 1,623 1,459
Provision for loan losses 38 0 51 8
Net interest income after provision for loan losses 488 519 1,572 1,451

NON-INTEREST INCOME:
Fees and other non-interest income 48 35 149 82
Gain/(Loss) on sale of securities (30 ) 66 (30 ) 77
Miscellaneous income 6 3 15 10
Total non-interest income 24 104 134 169

NON-INTEREST EXPENSE:
Salaries and employee benefits 356 346 1,089 1,009
Office building and equipment expenses 57 51 162 153
Professional Services Expense 45 53 138 178
Data Processing Expense 79 69 214 199
Other operating expense 81 72 238 262
Total non-interest expense 618 591 1,841 1,801
Income / (loss) before income taxes (106 ) 32 (135 ) (181 )

PROVISION / (BENEFIT) FOR INCOME TAXES (40 ) 12 (51 ) (68 )

Net Income / (Loss) $ (66 ) $ 20 $ (84 ) $ (113 )

EARNINGS / (LOSS) PER SHARE:
Basic $ (0.08 ) $ 0.03 $ (0.11 ) $ (0.14 )
Diluted $ (0.08 ) $ 0.03 $ (0.11 ) $ (0.14 )

DIVIDENDS DECLARED PER SHARE $ 0.0875 $ 0.0875 $ 0.2625 $ 0.2625

AVERAGE SHARES OUTSTANDING:
Basic 780,318 780,318 780,318 780,318
Diluted 780,347 780,422 780,390 781,182

The Southern Banc Company, Inc.
Gates Little, 256-543-3860

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