Citizens South Bank Celebrates a New Name, Rich History and Bright Future.

Business Editors

GASTONIA, N.C.--(BUSINESS WIRE)--Jan. 28, 2002

The Board of Directors and Shareholders of Gaston Federal Bank have voted to change the name of Gaston Federal Bank to Citizens South Bank upon appropriate regulatory approval.

Citizens South Bank is a wholly owned subsidiary of Gaston Federal Bancorp, Inc. (Nasdaq: GBNK). The bank unveiled a new logo that soon will be incorporated in the bank's signage at its ten offices in the Central Piedmont of North Carolina. The newly named bank will remain headquartered in Gastonia.

Created through Gaston Federal's acquisition of Salisbury-based Citizens Bank on Dec. 31, 2001, Citizens South Bank now has assets of about $450 million.

"We are excited about introducing the Citizens South name to Gaston, Iredell, and Rowan Counties," says Kim Price, Citizens South Bank president. "The adoption of a new name is a milestone in our efforts to expand our hometown approach to banking throughout the Central Piedmont area. With ten locations in eight towns, we have a bank of wonderful convenience and hometown accessibility."

For Citizens South Bank customers in Gaston, Iredell, and Rowan Counties, the name change means business as usual. They will see new signs, but they will be banking with many of the same people, and their account numbers will not change. Customers can continue to use their existing checks and deposit slips. Backed by an expanded selection of products and services and advantages of access to a wider network of office and ATM locations, customers can expect the same great hometown banking service. "While the name change is important, so too is our continued commitment to our customers and communities," says Price. "Citizens South is more committed than ever to investing in the growth and economic health of our communities."

Founded in 1904, Citizens South Bank is Gaston County's oldest chartered financial institution. The bank has locations in Gastonia, Mount Holly, Dallas, Stanley, Salisbury, Statesville, Rockwell and a loan production office in Shelby. Over its 97 years, the bank has continued its mission of offering a friendly atmosphere and very personal service to its customers.