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VIRGINIA FIRST SAVINGS ANNOUNCES EARNINGS

 PETERSBURG, Va., Oct. 20 /PRNewswire/ -- Virginia First Savings Bank, F.S.B. (NASDAQ: VFSB), today announced net earnings of $1,836,000 or $.66 per share for the quarter ended Sept. 30, 1993, an increase of 8.13 percent from the $1,698,000 or $.63 per share for the quarter ended Sept. 30, 1992.
 The net earnings for the quarter ended Sept. 30, 1992 have been restated to reflect the effects of adopting the Financial Accounting Standards Board's Statement No. 109, "Accounting for Income Taxes" ("SFAS 109"). The previously published results of $1,585,000 or $.59 per share did not reflect the effects of the adoption of SFAS 109 retroactive to July 1, 1992. The earnings for the quarter ended Sept. 30, 1993, are 15.84 percent higher than the $1,585,000 previously reported for the quarter ended Sept. 30, 1992.
 William A. Patton, chairman of the board of directors, also announced that Virginia First will pay a quarterly dividend of 2.5 cents per share on Nov. 10, 1993, to its stockholders of record as of Oct. 29, 1993.
 Patton noted that "the net earnings for the first quarter of our fiscal year ending June 30, 1993 ("fiscal year 1994") of $1,836,000 represented a 1.34 percent annualized return on average total assets and a 20.30 percent annualized return on average equity, while earnings for the same period in fiscal year 1993 represented a 1.29 percent annualized return on average total assets and a 21.92 percent annualized return on average equity."
 Both total interest income and total interest expense during the first quarter of fiscal year 1994 were lower than in the same period in the previous fiscal year, due to the generally lower yields and rates prevailing in the marketplace. However, the net interest income of $4,860,000 for the first quarter of fiscal year 1994 was 10.4 percent higher than the $4,404,000 in the previous year. According to Patton, "the improved net interest margin performance is due to the continuing maturity and repricing of retail deposits and other interest-bearing liabilities together with attractive yields provided through Virginia First's construction and retail lending divisions."
 Virginia First originated $216.5 million of residential mortgage loans in the first quarter of fiscal year 1994, which was 22 percent higher than the $177.8 million produced in the first quarter of fiscal year 1993. Virginia First sold $249.4 million of residential mortgage loans in the secondary market in the first quarter of fiscal year 1994, which was 81 percent more than the $137.6 million sold in the first quarter of fiscal year 1993.
 The net amount of mortgage loans serviced for others increased by $19.3 million to $672.9 million at Sept. 30, 1993, notwithstanding the sales of $54.3 million of mortgage servicing rights during the quarter ended Sept. 30, 1993, resulting in pre-tax gains of $672,000. Virginia First sold $45.5 million of servicing in the quarter ended Sept. 30, 1992, for pre-tax gains of $623,000. Virginia First serviced $653.6 million of mortgages for others as of June 30, 1993, and $443.2 million as of Sept. 30, 1992.
 Management continued the posture of providing allowances where appropriate to mitigate the potential impact of future credit or market losses. Additional provisions totalling $1,004,000 were taken during the first quarter of fiscal year 1994, of which $600,000 was used to reduce the carrying value of the capitalized excess servicing asset which has been adversely affected by mortgage loan prepayments. Similar provisions totalling $1,375,000 were taken in the first quarter of fiscal year 1993, including $390,000 taken against excess servicing. The amount of capitalized excess servicing on Virginia First's books was $1.4 million at Sept. 30, 1993, compared to $3.5 million at Sept. 30, 1992.
 Total assets were $553,631,000 at Sept. 30, 1993, compared to $561,239,000 at June 30, 1993, and $531,784,000 at Sept. 30, 1992. Deposit liabilities were $455,623,000, compared to $454,231,000 at June 30, 1993, and $454,960,000 at Sept. 30, 1992.
 At Sept. 30, 1993, stockholders' equity was $36,282,000 or $13.82 per outstanding share. Virginia First exceeds all of the regulatory capital requirements.
 The Annual Meeting of Stockholders is scheduled for Wednesday, Nov. 10, 1993, at 4 p.m. at the main office lobby of Virginia First in Petersburg, Va.
 Virginia First presently operates 22 full service retail branches in central and western Virginia and 13 mortgage production offices in the states of Virginia and Maryland.
 VIRGINIA FIRST SAVINGS BANK
 Selected Financial Data
 (Dollars in Thousands Except Per Share Data)
 Three Months Ended
 Sept. 30, Sept. 30,
 1993 1992
 Results of Operations
 Total interest income $ 10,059 $ 10,279
 Total interest expense 5,199 5,875
 Net interest income 4,860 4,404
 Provision for loan losses 275 295
 Noninterest income 3,705 2,693
 Noninterest expenses 5,322 4,014
 Income tax expense 1,132 1,090
 Net earnings (loss) 1,836 1,698
 Balance at Period-End
 Assets $553,631 $531,784
 Mortgage backed securities and
 collateralized mortgage obligations 18,178 15,164
 Loans receivable 473,281 450,001
 Deposits 455,623 454,960
 Notes payable and other borrowings 909 660
 Advances from Federal Home Loan Bank 54,000 39,600
 Stockholders' equity 36,282 30,951
 Per Share Data
 Net earnings $ .66 $ .63
 Cash dividends declared 0.025 0.000
 Book value per outstanding share 13.82 11.80
 Selected Ratios
 Net earnings as a percentage of:
 Average total assets 1.34pct. 1.29pct.
 Average stockholders' equity 20.30pct. 21.92pct.
 Average equity to average assets 6.58pct. 5.85pct.
 Other Data:
 Retail offices 22 22
 Loan production centers 13 11
 Loan originations and purchases
 during the period $263,723 $204,627
 Mortgage loans serviced for
 others at period-end 672,862 443,234
 -0- 10/20/93
 /CONTACT: Paul W. Walk Jr., senior vice president of Virginia First Savings Bank, 804-733-0333 or 804-748-5847/
 (VFSB)


CO: Virginia First Savings Bank ST: Virginia IN: FIN SU: ERN

CM-MM -- CH002 -- 4494 10/20/93 10:45 EDT
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Date:Oct 20, 1993
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