Greater Hudson Bank, N.A. Reports Increased Earnings for the 2015 First Quarter

MIDDLETOWN, NY--(Marketwired - April 29, 2015) - Greater Hudson Bank, N.A. (the "Bank") (OTCQX: GHDS), with assets of $398.5 million, today reported net income of $828,000 or $0.08 per common share for the first quarter of 2015 compared to $654,000 or $0.07 per common share for the 2014 first quarter. Return on average common stockholders' equity was 8.07 percent compared to 6.59 percent for the three months ended March 31, 2015 and March 31, 2014, respectively.

Edward T. Lutz, President and CEO, stated, "The first quarter of 2015 was strong from an earnings perspective as forward momentum in increasing loans and assets offset industry-wide margin pressure. We are pleased that the quarter's results, which were robust as compared to historical performance, reflect our efforts to control expenses and improve our efficiency ratio." Mr. Lutz further stated that, "We continue to make progress in developing our business as we intensify our calling efforts, which are designed to win new core accounts. Our model of providing local businesses, non-profits and municipalities with old-fashion personal service combined with cutting edge technology continues to be well received."

Financial highlights as of March 31, 2015 compared to December 31, 2014 are as follows:

• Total assets increased $4.1 million, or 1.0 percent, to $398.5 million.
• Loans, net of unearned income, increased $4.9 million, or 1.9 percent, to $261.7 million.
• Investments decreased $5.1 million, or 4.5 percent, to $108.0 million.
• Deposits decreased $2.9 million, or 0.9 percent, to $314.1 million.

Performance highlights for the three months ended March 31, 2015 compared to the March 31, 2014 period are as follows:

• Net interest income increased $298,000, or 9.9 percent, to $3.3 million.
• Non-interest income increased $42,000, or 42.4 percent, to $141,000.
• Gains on securities transactions decreased $219,000.
• Provision for loan losses decreased $43,000.

"I would like to congratulate the staff on the first quarter of 2015, which compares very favorably to the first quarter of 2014," stated Kenneth J. Torsoe, chairman of the board. Mr. Torsoe further stated that, "The progress in profitably growing this institution and meeting the financial needs of so many customers in the Hudson Valley is cause for appreciation. I know the staff is motivated and focused on continuing to attract new business to Greater Hudson Bank, one of the few community banks to operate in the Hudson Valley."

EARNINGS

The increase in net income for the three months ended March 31, 2015 compared to the three months ended March 31, 2014, is primarily attributable to an increase in net interest income of $298,000, a decrease to the provision for loan losses of $43,000 and an increase to noninterest income of $42,000. These increases were partially offset by a decrease in security gains of $219,000 for the period. The increase in net interest income was driven by the growth in the loan and investment portfolios and slight decreases to non-interest expenses quarter-over-quarter.

BALANCE SHEET & CREDIT QUALITY

The Bank increased loans, net of unearned income, by $4.9 million as of March 31, 2015 compared to December 31, 2014. The increase in the loan portfolio was funded primarily by sales/redemptions in the securities portfolio of $5.0 million. The Bank also increased borrowings by $6.0 million during the quarter.

Nonperforming assets increased to $3.4 million as of March 31, 2015 from $3.0 million as of December 31, 2014. The increase is related to a limited number of loan relationships that the Bank is actively attempting to remediate and is closely monitoring.

CAPITAL

At March 31, 2015, the Bank had $42.8 million in stockholders' equity. The Bank's leverage ratio was 10.3 percent at March 31, 2015 compared to 11.4 percent at March 31, 2014. The Bank continues to be considered a well-capitalized institution under current Federal regulatory guidelines.

Greater Hudson Bank's annual Stockholders' Meeting will be held Thursday, May 21, 2015 at 10:00 a.m. at the Salvation Army Conference Center in West Nyack, NY. All shareholders and interested parties are invited to attend.

Greater Hudson Bank, N.A., founded in 2002, is headquartered in Middletown, NY. The Bank which specializes in providing customized banking services to Hudson Valley based businesses, non-profits and municipal agencies is chartered by the Office of the Comptroller of the Currency and its deposits are insured by the FDIC. As evidence of the Banks' financial strength, Greater Hudson Bank has been recognized with a superior rating by the country's leading independent bank rating and research firm, BauerFinancial, Inc. Further information can be found on the Bank's website at www.GreaterHudsonBank.com or by calling 844-GREAT-11.

Forward-Looking Statements: This Press Release may contain certain statements which are not historical facts or which concern the Bank's future operations or economic performance and which are to be considered forward-looking statements. Any such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Bank cautions that all forward-looking statements involve risk and uncertainties, and that actual results may differ from those indicated in the forward-looking statements as a result of various factors, such as changing economic and competitive conditions and other risk and uncertainties. In addition, any statements in this news release regarding historical stock price performance are not indicative of or guarantees of future price performance.