Edgar Filing: GREENE COUNTY BANCORP INC

form10qmarch312012.htm

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

-----------------------------------

FORM 10-Q

[x] QUARTERLY REPORT UNDER SECTION 13 OF 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2012

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OF 15(d) OF THE SECURITIES EXCHANGE ACT

GREENE COUNTY BANCORP, INC.

(Exact name of registrant as specified in its charter)

Commission file number 0-25165

United States 14-1809721

(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number)

302 Main Street, Catskill, New York 12414

(Address of principal executive office) (Zip code)

Registrant's telephone number, including area code: (518) 943-2600

Check whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes: X No: _____

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes: X No: ______

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer _____ Accelerated filer _____

Non-accelerated filer _____ Smaller reporting company X

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes: No: X

As of May 8, 2012, the registrant had 4,167,854 shares of common stock outstanding at $ 0.10 par value per share.

	GREENE COUNTY BANCORP, INC.



	INDEX



PART I.	FINANCIAL INFORMATION
		Page
Item 1.	Financial Statements (unaudited)
	* Consolidated Statements of Financial Condition	3
	* Consolidated Statements of Income	4-5
	* Consolidated Statements of Comprehensive Income	6
	* Consolidated Statements of Changes in Shareholders’ Equity	7
	* Consolidated Statements of Cash Flows	8-9
	* Notes to Consolidated Financial Statements	10-31

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32-45

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	46

Item 4.	Controls and Procedures	46

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings	47

Item 1A.	Risk Factors	47

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	47

Item 3.	Defaults Upon Senior Securities	47

Item 4.	Mine Safety Disclosures	47

Item 5.	Other Information	47

Item 6.	Exhibits	47

	Signatures	48
	Exhibit 31.1 302 Certification of Chief Executive Officer Exhibit 31.2 302 Certification of Chief Financial Officer Exhibit 32.1 906 Statement of Chief Executive Officer Exhibit 32.2 906 Statement of Chief Financial Officer Exhibit 101 Extensible Business Reporting Language (XBRL)	49 50 51 52

Greene County Bancorp, Inc.

Consolidated Statements of Financial Condition

As of March 31, 2012 and June 30, 2011

(Unaudited)

(In thousands, except share and per share amounts)

ASSETS	March 31, 2012			June 30, 2011
Cash and due from banks	$	30,576		$	9,245
Federal funds sold		300			721
Total cash and cash equivalents		30,876			9,966

Securities available for sale, at fair value		74,205			90,117
Securities held to maturity, at amortized cost		139,444			124,177
Federal Home Loan Bank stock, at cost		1,138			1,916

Loans		317,675			305,620
Allowance for loan losses		(5,967	)		(5,069	)
Unearned origination fees and costs, net		414			495
Net loans receivable		312,122			301,046

Premises and equipment		15,035			15,407
Accrued interest receivable		2,802			2,716
Foreclosed real estate		410			443
Prepaid expenses and other assets		2,648			1,737
Total assets	$	578,680		$	547,525

LIABILITIES AND SHAREHOLDERS’ EQUITY
Noninterest bearing deposits	$	49,807		$	49,313
Interest bearing deposits		464,790			420,584
Total deposits		514,597			469,897

Borrowings from FHLB, short-term		---			14,300
Borrowings from FHLB, long-term		9,000			12,000
Accrued expenses and other liabilities		3,315			3,247
Total liabilities		526,912			499,444

Shareholders’ equity:
Preferred stock,
Authorized - 1,000,000 shares; Issued - None		---			---
Common stock, par value $.10 per share;
Authorized - 12,000,000 shares
Issued - 4,305,670 shares
Outstanding - 4,166,854 shares at March 31, 2012
and 4,145,828 shares at June 30, 2011;		431			431
Additional paid-in capital		11,118			11,001
Retained earnings		40,853			37,336
Accumulated other comprehensive income		413			519
Treasury stock, at cost 138,816 shares at March 31, 2012
and 159,842 shares at June 30, 2011		(1,047	)		(1,206	)
Total shareholders’ equity		51,768			48,081
Total liabilities and shareholders’ equity	$	578,680		$	547,525

See notes to consolidated financial statements.

Greene County Bancorp, Inc.

Consolidated Statements of Income

For the Nine Months Ended March 31, 2012 and 2011

(Unaudited)

(In thousands, except share and per share amounts)

	2012		2011
Interest income:
Loans	$	13,384	$	13,434
Investment securities - taxable		692		875
Mortgage-backed securities		3,273		2,821
Investment securities - tax exempt		996		879
Interest bearing deposits and federal funds sold		17		32
Total interest income		18,362		18,041

Interest expense:
Interest on deposits		2,463		3,007
Interest on borrowings		315		422
Total interest expense		2,778		3,429

Net interest income		15,584		14,612
Provision for loan losses		1,437		1,179
Net interest income after provision for loan losses		14,147		13,433

Noninterest income:
Service charges on deposit accounts		1,857		1,733
Debit card fees		1,026		925
Investment services		199		199
E-commerce fees		81		83
Net gain on sale of available-for-sale securities		11		233
Other operating income		425		390
Total noninterest income		3,599		3,563

Noninterest expense:
Salaries and employee benefits		6,047		6,025
Occupancy expense		916		973
Equipment and furniture expense		478		401
Service and data processing fees		1,158		1,111
Computer software, supplies and support		249		207
Advertising and promotion		235		245
FDIC insurance premiums		231		468
Legal and professional fees		583		480
Other		1,250		1,151
Total noninterest expense		11,147		11,061

Income before provision for income taxes		6,599		5,935
Provision for income taxes		2,112		2,020
Net income	$	4,487	$	3,915

Basic EPS	$	1.08	$	0.95
Basic average shares outstanding		4,150,978		4,131,052
Diluted EPS	$	1.07	$	0.94
Diluted average shares outstanding		4,192,567		4,162,716
Dividends per share	$	0.525	$	0.725

See notes to consolidated financial statements.

Greene County Bancorp, Inc.

Consolidated Statements of Income

For the Three Months Ended March 31, 2012 and 2011

(Unaudited)

(In thousands, except share and per share amounts)

	2012		2011
Interest income:
Loans	$	4,441	$	4,388
Investment securities - taxable		222		298
Mortgage-backed securities		963		998
Investment securities - tax exempt		370		303
Interest bearing deposits and federal funds sold		3		12
Total interest income		5,999		5,999

Interest expense:
Interest on deposits		749		962
Interest on borrowings		88		117
Total interest expense		837		1,079

Net interest income		5,162		4,920
Provision for loan losses		541		343
Net interest income after provision for loan losses		4,621		4,577

Noninterest income:
Service charges on deposit accounts		602		560
Debit card fees		338		306
Investment services		62		51
E-commerce fees		26		28
Net gain on sale of available-for-sale securities		--		21
Other operating income		149		136
Total noninterest income		1,177		1,102

Noninterest expense:
Salaries and employee benefits		2,103		2,054
Occupancy expense		303		362
Equipment and furniture expense		146		121
Service and data processing fees		388		413
Computer software, supplies and support		87		72
Advertising and promotion		90		55
FDIC insurance premiums		79		187
Legal and professional fees		174		161
Other		351		391
Total noninterest expense		3,721		3,816

Income before provision for income taxes		2,077		1,863
Provision for income taxes		594		624
Net income	$	1,483	$	1,239

Basic EPS	$	0.36	$	0.30
Basic average shares outstanding		4,159,093		4,142,160
Diluted EPS	$	0.35	$	0.30
Diluted average shares outstanding		4,197,430		4,172,127
Dividends per share	$	0.175	$	0.175

See notes to consolidated financial statements.

Greene County Bancorp, Inc.

Consolidated Statements of Comprehensive Income

For the Nine Months Ended March 31, 2012 and 2011

(Unaudited)

(In thousands)

	2012			2011
Net income	$	4,487		$	3,915

Other comprehensive income (loss):
Securities:
Unrealized holding losses on available for sale securities, arising
during the nine months ended March 31, 2012 and 2011,
net of income taxes of ($88) and ($469), respectively.		(139	)		(742	)

Reclassification adjustment for gain on sale of available-for-sale securities
realized in net income, net of income taxes of ($4) and ($90), respectively		(7	)		(143	)

Accretion of unrealized loss on securities transferred to held-to-maturity,
net of income taxes of $18 and $21, respectively		28			34

Pension, actuarial gain, net of income tax of $8 and $3		12			7

Other comprehensive loss		(106	)		(844	)

Comprehensive income	$	4,381		$	3,071

Greene County Bancorp, Inc.

Consolidated Statements of Comprehensive Income

For the Three Months Ended March 31, 2012 and 2011

(Unaudited)

(In thousands)

	2012			2011
Net income	$	1,483		$	1,239

Other comprehensive income (loss):
Securities:
Unrealized holding losses on available for sale securities, arising
during the three months ended March 31, 2012 and 2011,
net of income taxes of ($144) and ($172), respectively.		(226	)		(272	)

Reclassification adjustment for gain on sale of available-for-sale securities
realized in net income, net of income taxes of $-- and ($8), respectively		---			(13	)

Accretion of unrealized loss on securities transferred to held-to-maturity,
net of income taxes of $6 and $7, respectively		9			11

Pension, actuarial gain, net of income tax of $3 and $1		4			2

Other comprehensive loss		(213	)		(272	)

Comprehensive income	$	1,270		$	967

See notes to consolidated financial statements.

Greene County Bancorp, Inc.

Consolidated Statements of Changes in Shareholders’ Equity

For the Nine Months Ended December 31, 2011 and 2010

(Unaudited)

(In thousands)

								Accumulated
			Additional					Other						Total
	Common		Paid – In		Retained			Comprehensive			Treasury			Shareholders’
	Stock		Capital		Earnings			Income			Stock			Equity

Balance at
June 30, 2010	$	431	$	10,666	$	33,692		$	1,123		$	(1,409	)	$	44,503

Stock options exercised				109								203			312

Tax effect of stock options				3											3

Stock options compensation				167											167

Dividends declared						(1,325	)								(1,325	)

Net income						3,915									3,915

Total other comprehensive loss, net of taxes									(844	)					(844	)
Balance at
March 31, 2011	$	431	$	10,945	$	36,282		$	279		$	(1,206	)	$	46,731

Balance at

June 30, 2011	$	431	$	11,001	$	37,336		$	519		$	(1,206	)	$	48,081

Stock options exercised				94								159			253

Tax effect of stock options				4											4

Stock options compensation				19											19

Dividends declared						(970	)								(970	)

Net income						4,487									4,487

Total other comprehensive loss, net of taxes									(106	)					(106	)
Balance at
March 31, 2012	$	431	$	11,118	$	40,853		$	413		$	(1,047	)	$	51,768

See notes to consolidated financial statements.

Greene County Bancorp, Inc.

Consolidated Statements of Cash Flows

For the Nine Months Ended March 31, 2012 and 2011

(Unaudited)

(In thousands)	2012			2011
Cash flows from operating activities:
Net Income	$	4,487		$	3,915
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		625			536
Net amortization of premiums and discounts		786			767
Net amortization of deferred loan costs and fees		199			175
Provision for loan losses		1,437			1,179
Stock option compensation		19			167
Net gain on sale of available-for-sale securities		(11	)		(233	)
Loss on sale of foreclosed real estate		121			---
Excess tax benefit from share-based payment arrangements		(4	)		---
Net increase in accrued income taxes		(996	)		(432	)
Net increase in accrued interest receivable		(86	)		(97	)
Net decrease in prepaid and other assets		87			320
Net increase in other liabilities		157			421
Net cash provided by operating activities		6,821			6,718

Cash flows from investing activities:
Securities available-for-sale:
Proceeds from maturities		7,375			7,411
Proceeds from sale of securities		770			7,729
Purchases of securities		(7,698	)		(30,308	)
Principal payments on securities		14,912			8,497
Securities held-to-maturity:
Proceeds from maturities		9,642			13,827
Purchases of securities		(32,858	)		(58,412	)
Principal payments on securities		7,534			4,086
Net redemption of Federal Home Loan Bank Stock		778			634
Maturity of long term certificate of deposit		---			1,000
Net increase in loans receivable		(13,365	)		(2,986	)
Proceeds from sale of foreclosed real estate		565			---
Purchases of premises and equipment		(253	)		(1,247	)
Net cash used in investing activities		(12,598	)		(49,769	)

Cash flows from financing activities:
Net decrease in short-term FHLB advances		(14,300	)		(9,100	)
Repayment of long-term borrowings		(3,000	)		(5,000	)
Payment of cash dividends		(970	)		(1,325	)
Proceeds from stock options exercised		253			312
Excess tax benefit from share-based payment arrangements		4			---
Net increase in deposits		44,700			77,117
Net cash provided by financing activities		26,687			62,004

Net increase in cash and cash equivalents		20,910			18,953
Cash and cash equivalents at beginning of period		9,966			9,643
Cash and cash equivalents at end of period	$	30,876		$	28,596

Non-cash investing activities:
Foreclosed loans transferred to foreclosed real estate	$	653		$	563
Cash paid during the period:
Interest	$	2,778		$	3,434
Income taxes		3,108			2,453
See notes to consolidated financial statements.

Greene County Bancorp, Inc.

Notes to Consolidated Financial Statements

As of and for the Three and Nine Months Ended March 31, 2012 and 2011

(1) Basis of Presentation

The accompanying consolidated statement of financial condition as of June 30, 2011 was derived from the audited consolidated financial statements as of and for the year then ended of Greene County Bancorp, Inc. (the “Company”) and its wholly owned subsidiary, The Bank of Greene County (the “Bank”) and the Bank’s wholly owned subsidiaries, Greene County Commercial Bank and Greene Property Holdings, Ltd. In June 2011, Greene Property Holdings, Ltd. was formed as a New York corporation that has elected under the Internal Revenue Code to be a real estate investment trust. Greene Property Holdings, Ltd. is a subsidiary of The Bank of Greene County. The Company received regulatory approvals to commence operation of this subsidiary during the quarter ended December 31, 2011. Certain mortgages and notes currently held by The Bank of Greene County were transferred and beneficially owned by Greene Property Holdings, Ltd. as of January 4, 2012. The Bank of Greene County will continue to service these loans. Greene Property Holdings financial statements will be consolidated with The Bank of Greene County, and therefore, the impact to the consolidated financial statement of Greene County Bancorp, Inc. was not material. The consolidated financial statements at and for the three and nine months ended March 31, 2012 and 2011 are unaudited.

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. To the extent that information and notes required by GAAP for complete financial statements are contained in or are consistent with the audited financial statements incorporated by reference to Greene County Bancorp, Inc.’s Annual Report on Form 10-K for the year ended June 30, 2011, such information and notes have not been duplicated herein. In the opinion of management, all adjustments (consisting of only normal recurring items) necessary for a fair presentation of the financial position and results of operations and cash flows at and for the periods presented have been included. Amounts in the prior year’s consolidated financial statements have been reclassified whenever necessary to conform to the current year’s presentation. These reclassifications, if any, had no effect on net income or shareholders’ equity as previously reported. All material inter-company accounts and transactions have been eliminated in the consolidation. The results of operations and other data for the three and nine months ended March 31, 2012 are not necessarily indicative of results that may be expected for the entire fiscal year ending June 30, 2012. These consolidated financial statements consider events that occurred through the date the consolidated financial statements were issued.

CRITICAL ACCOUNTING POLICIES

Greene County Bancorp, Inc.’s critical accounting policies relate to the allowance for loan losses and the evaluation of securities for other-than-temporary impairment. The allowance for loan losses is based on management’s estimation of an amount that is intended to absorb losses in the existing portfolio. The allowance for loan losses is established through a provision for losses based on management’s evaluation of the risk inherent in the loan portfolio, the composition of the portfolio, specific impaired loans and current economic conditions. Such evaluation, which includes a review of all loans for which full collectibility may not be reasonably assured, considers among other matters, the estimated net realizable value or the fair value of the underlying collateral, economic conditions, historical loan loss experience, management’s estimate of probable credit losses and other factors that warrant recognition in providing for the allowance of loan losses. However, this evaluation involves a high degree of complexity and requires management to make subjective judgments that often require assumptions or estimates about highly uncertain matters. This critical accounting policy and its application are periodically reviewed with the Audit Committee and the Board of Directors.

Securities are evaluated for other-than-temporary impairment by performing periodic reviews of individual securities in the investment portfolio. Greene County Bancorp, Inc. makes an assessment to determine whether there have been any events or economic circumstances to indicate that a security on which there is an unrealized loss is impaired on an other-than-temporary basis. The Company considers many factors, including the severity and duration of the impairment; the intent and ability of the Company to hold the security for a period of time sufficient for a recovery in value; recent events specific to the issuer or industry; and for debt securities, intent to sell the security, the likelihood to be required to sell the security before it recovers the entire amortized cost, external credit ratings and recent downgrades. The Company is required to record other-than-temporary impairment charges through earnings, if it has the intent to sell, or will more likely than not be required to sell an impaired debt security before a recovery of its amortized cost basis. In addition, the Company is required to record other-than-temporary impairment charges through earnings for the amount of credit losses, regardless of the intent or requirement to sell. Credit loss is measured as the difference between the present value of an impaired debt security’s cash flows and its amortized cost basis. Non-credit related impairment must be recorded as decreases to accumulated other comprehensive income as long as the Company has no intent or requirement to sell an impaired security before a recovery of amortized cost basis.

(2) Nature of Operations

Greene County Bancorp, Inc.’s primary business is the ownership and operation of its wholly owned subsidiary, The Bank of Greene County (the “Bank”) and the Bank’s wholly owned subsidiaries, Greene County Commercial Bank and Greene Property Holdings, Ltd.. The Bank of Greene County has twelve full-service offices and an operations center located in its market area consisting of Greene County, Columbia County and southern Albany County, New York. The Bank of Greene County is primarily engaged in the business of attracting deposits from the general public in The Bank of Greene County’s market area, and investing such deposits, together with other sources of funds, in loans and investment securities. Greene County Commercial Bank’s primary business is to attract deposits from and provide banking services to local municipalities. Greene Property Holdings, Ltd., another subsidiary of The Bank of Greene County, operates as a real estate investment trust that holds residential mortgages, providing additional flexibility and planning opportunities for the business of the Bank.

(3) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses and the assessment of other-than-temporary security impairment.

While management uses available information to recognize losses on loans, future additions to the allowance for loan losses (the “Allowance”) may be necessary, based on changes in economic conditions, asset quality or other factors. In addition, various regulatory authorities, as an integral part of their examination process, periodically review our Allowance. Such authorities may require the Company to recognize additions to the Allowance based on their judgments of information available to them at the time of their examination.

Greene County Bancorp, Inc. makes an assessment to determine whether there have been any events or economic circumstances to indicate that a security on which there is an unrealized loss is impaired on an other-than-temporary basis. The Company considers many factors including the severity and duration of the impairment; the intent and ability of the Company to hold the security for a period of time sufficient for a recovery in value; recent events specific to the issuer or industry; and for debt securities, intent to sell the security, whether it is more likely than not we will be required to sell the security before recovery, whether loss of the entire amortized cost is expected, external credit ratings and recent downgrades. Securities on which there is an unrealized loss that is deemed to be other-than-temporary are written down to fair value.

(4) Securities

Greene County Bancorp, Inc.’s current policies generally limit securities investments to U.S. Government and securities of government sponsored enterprises, federal funds sold, municipal bonds, corporate debt obligations and certain mutual funds. In addition, the Company’s policies permit investments in mortgage-backed securities, including securities issued and guaranteed by Fannie Mae, Freddie Mac, and GNMA, and collateralized mortgage obligations. As of March 31, 2012, all mortgage-backed securities including collateralized mortgage obligations were securities of government sponsored enterprises, no private-label mortgage-backed securities or collateralized mortgage obligations were held in the securities portfolio. The Company's current securities investment strategy utilizes a risk management approach of diversified investing among three categories: short-, intermediate- and long-term. The emphasis of this approach is to increase overall investment securities yields while managing interest rate risk. The Company will only invest in securities rated “A” or higher by at least one nationally recognized rating agency (or securities attaining such rating as a result of guarantees by insurance companies), with the exception of investments in smaller non-rated local bonds. The Company does not engage in any derivative or hedging transactions, such as interest rate swaps or caps.

Securities at March 31, 2012 consisted of the following:

			Gross		Gross		Estimated
	Amortized		Unrealized		Unrealized		Fair
(In thousands)	Cost		Gains		Losses		Value
Securities available-for-sale:
U.S. government sponsored enterprises	$	19,839	$	346	$	92	$	20,093
State and political subdivisions		5,439		153		---		5,592
Mortgage-backed securities-residential		23,926		511		4		24,433
Mortgage-backed securities-multi-family		17,032		577		29		17,580
Asset-backed securities		21		---		1		20
Corporate debt securities		6,101		260		---		6,361
Total debt securities		72,358		1,847		126		74,079
Equity and other securities		67		59		---		126
Total securities available-for-sale		72,425		1,906		126		74,205
Securities held-to-maturity:
U.S. treasury securities		11,037		74		---		11,111
U.S. government sponsored enterprises		998		29		---		1,027
State and political subdivisions		53,197		494		115		53,576
Mortgage-backed securities-residential		52,184		2,202		50		54,336
Mortgage-backed securities-multi-family		21,643		606		5		22,244
Other securities		385		---		---		385
Total securities held-to-maturity		139,444		3,405		170		142,679
Total securities	$	211,869	$	5,311	$	296	$	216,884

Securities at June 30, 2011 consisted of the following:

			Gross		Gross		Estimated
	Amortized		Unrealized		Unrealized		Fair
(In thousands)	Cost		Gains		Losses		Value
Securities available-for-sale:
U.S. government sponsored enterprises	$	25,909	$	171	$	377	$	25,703
State and political subdivisions		6,819		243		---		7,062
Mortgage-backed securities-residential		28,214		773		73		28,914
Mortgage-backed securities-multi-family		20,184		912		---		21,096
Asset-backed securities		24		---		1		23
Corporate debt securities		6,881		325		---		7,206
Total debt securities		88,031		2,424		451		90,004
Equity and other securities		67		46		---		113
Total securities available-for-sale		88,098		2,470		451		90,117
Securities held-to-maturity:
U.S. treasury securities		11,062		70		---		11,132
U.S. government sponsored enterprises		997		30		---		1,027
State and political subdivisions		34,933		200		9		35,124
Mortgage-backed securities-residential		57,347		1,737		35		59,049
Mortgage-backed securities-multi-family		19,434		47		14		19,467
Other securities		404		2		---		406
Total securities held-to-maturity		124,177		2,086		58		126,205
Total securities	$	212,275	$	4,556	$	509	$	216,322

The following table shows fair value and gross unrealized losses, aggregated by security category and length of time that individual securities have been in a continuous unrealized loss position, at March 31, 2012.

	Less Than 12 Months				More Than 12 Months				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(In thousands)	Value		Losses		Value		Losses		Value		Losses
Securities available-for-sale:
U.S. government sponsored enterprises	$	3,990	$	92	$	---	$	---	$	3,990	$	92
Mortgage-backed securities-residential		1,179		4		---		---		1,179		4
Mortgage-backed securities-multi-family		1,532		29		---		---		1,532		29
Asset-backed securities		---		---		20		1		20		1
Total securities available-for-sale		6,701		125		20		1		6,721		126
Securities held-to-maturity:
State and political subdivisions		7,578		115		---		---		7,578		115
Mortgage-backed securities-residential		2,475		39		2,614		11		5,089		50
Mortgage-backed securities-multifamily		722		5		---		---		722		5
Total securities held-to-maturity		10,775		159		2,614		11		13,389		170
Total securities	$	17,476	$	284	$	2,634	$	12	$	20,110	$	296

	Less Than 12 Months				More Than 12 Months				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(In thousands)	Value		Losses		Value		Losses		Value		Losses
Securities available-for-sale:
U.S. government sponsored enterprises	$	13,446	$	377	$	---	$	---	$	13,446	$	377
Mortgage-backed security-residential		6,571		73		---		---		6,571		73
Asset-backed securities		---		---		22		1		22		1
Total securities available-for-sale		20,017		450		22		1		20,039		451
Securities held-to-maturity:
State and political subdivisions		1,610		9		---		---		1,610		9
Mortgage-backed securities-residential		7,680		35		---		---		7,680		35
Mortgage-backed securities-multifamily		10,670		14		---		---		10,670		14
Total securities held-to-maturity		19,960		58		---		---		19,960		58
Total securities	$	39,977	$	508	$	22	$	1	$	39,999	$	509

At March 31, 2012, there were two securities which has been in a continuous unrealized loss position for more than 12 months and 29 securities in a continuous unrealized loss position of less than 12 months. When the fair value of a held to maturity or available for sale security is less than its amortized cost basis, an assessment is made as to whether other-than-temporary impairment (“OTTI”) is present. The Company considers numerous factors when determining whether a potential OTTI exists and the period over which the debt security is expected to recover. The principal factors considered are (1) the length of time and the extent to which the fair value has been less than the amortized cost basis, (2) the financial condition of the issuer (and guarantor, if any) and adverse conditions specifically related to the security, industry or geographic area, (3) failure of the issuer of the security to make scheduled interest or principal payments, (4) any changes to the rating of the security by a rating agency, and (5) the presence of credit enhancements, if any, including the guarantee of the federal government or any of its agencies.

For debt securities, OTTI is considered to have occurred if (1) the Company intends to sell the security, (2) it is more likely than not the Company will be required to sell the security before recovery of its amortized cost basis, or (3) if the present value of expected cash flows is not sufficient to recover the entire amortized cost basis. In determining the present value of expected cash flows, the Company discounts the expected cash flows at the effective interest rate implicit in the security at the date of acquisition. In estimating cash flows expected to be collected, the Company uses available information with respect to security prepayment speeds, default rates and severity. In determining whether OTTI has occurred for equity securities, the Company considers the applicable factors described above and the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.

For debt securities, credit-related OTTI is recognized in income while noncredit related OTTI on securities not expected to be sold is recognized in other comprehensive income (“OCI”). Credit-related OTTI is measured as the difference between the present value of an impaired security’s expected cash flows and its amortized cost basis. Noncredit-related OTTI is measured as the difference between the fair value of the security and its amortized cost less any credit-related losses recognized. For securities classified as held to maturity, the amount of OTTI recognized in OCI is accreted to the credit-adjusted expected cash flow amounts of the securities over future periods. For equity securities, the entire amount of OTTI is recognized in income. Management evaluated securities in an unrealized loss position at March 31, 2012 considering the factors as outlined above, and based on this evaluation the Company does not consider these investments to be other-than-temporarily impaired at March 31, 2012. Management believes that the reasons for the decline in fair value are due to interest rates and widening credit spreads during the reporting period.

Gross realized gains and losses on sales of securities or other-than-temporary impairment of securities recognized in income during the nine months ended March 31, 2012 and 2011 are as follows:

	Nine months ended March 31,
(in thousands)	2012		2011
Gross realized gains	$	11	$	233
Gross realized losses		---		---
Net gains (losses) recognized	$	11	$	233

During the nine months ended March 31, 2012 the Company sold $759,000 of corporate debt securities within its available-for-sale portfolio at a gain of $11,000. During the nine months ended March 31, 2011, the Company sold $6.4 million of securities issued by U.S. Government sponsored enterprises, and $1.1 million of mortgage-backed securities, which resulted in the recognition of a net gain of $233,000. There were no realized losses or other-than-temporary impairment losses recognized during the three and nine months ended March 31, 2012 and 2011.

The estimated fair values of debt securities at March 31, 2012, by contractual maturity are shown below. Expected maturities may differ from contractual maturities, because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Mortgage-backed securities and asset-backed securities are shown separately since they are not due at a single maturity date. The effective lives of these securities are expected to be significantly shorter than their contractual due dates due to prepayments of the underlying loans.

Available for sale debt securities	Amortized Cost		Fair Value
Within one year	$	5,000	$	5,052
After one year through five years		16,672		17,111
After five years through ten years		7,707		7,893
After ten years		2,000		1,990
Total available for sale debt securities		31,379		32,046
Mortgage-backed and asset-backed securities		40,979		42,033
Equity securities		67		126
Total available for sale securities		72,425		74,205

Held to maturity debt securities
Within one year		17,341		17,365
After one year through five years		24,377		24,638
After five years through ten years		15,933		16,116
After ten years		7,966		7,980
Total held to maturity debt securities		65,617		66,099
Mortgage-backed and asset-backed securities		73,827		76,580
Total held to maturity securities		139,444		142,679

Total securities	$	211,869	$	216,884

As of March 31, 2012, securities with an aggregate fair value of $155.7 million were pledged as collateral for deposits in excess of FDIC insurance limits for various municipalities placing deposits with Greene County Commercial Bank. Greene County Bancorp, Inc. did not participate in any securities lending programs during the quarters and nine months ended March 31, 2012 or 2011.

Federal Home Loan Bank Stock

Federal law requires a member institution of the Federal Home Loan Bank (“FHLB”) system to hold stock of its district FHLB according to a predetermined formula. This stock is restricted in that it can only be sold to the FHLB or to another member institution, and all sales of FHLB stock must be at par. As a result of these restrictions, FHLB stock is carried at cost. FHLB stock is held as a long-term investment and its value is determined based on the ultimate recoverability of the par value. Impairment of this investment is evaluated quarterly and is a matter of judgment that reflects management’s view of the FHLB’s long-term performance, which includes factors such as the following: its operating performance; the severity and duration of declines in the fair value of its net assets related to its capital stock amount; its commitment to make payments required by law or regulation and the level of such payments in relation to its operating performance; the impact of legislative and regulatory changes on the FHLB, and accordingly, on the members of the FHLB; and its liquidity and funding position. After evaluating these considerations, Greene County Bancorp, Inc. concluded that the par value of its investment in FHLB stock will be recovered and, therefore, no other-than-temporary impairment charge was recorded during the three and nine months ended March 31, 2012 or 2011.

(5) Credit Quality of Loans and Allowance for Loan Losses

Management closely monitors the quality of the loan portfolio and has established a loan review process designed to help grade the quality and profitability of the Company’s loan portfolio. The credit quality grade helps management make a consistent assessment of each loan relationship’s credit risk. Consistent with regulatory guidelines, The Bank of Greene County provides for the classification of loans considered being of lesser quality. Such ratings coincide with the "Substandard," "Doubtful" and "Loss" classifications used by federal regulators in their examination of financial institutions. Generally, an asset is considered Substandard if it is inadequately protected by the current net worth and paying capacity of the obligors and/or the collateral pledged. Substandard assets include those characterized by the distinct possibility that the insured financial institution will sustain some loss if the deficiencies are not corrected. Assets classified as Doubtful have all the weaknesses inherent in assets classified Substandard with the added characteristic that the weaknesses present make collection or liquidation in full, on the basis of currently existing facts, highly questionable and improbable. Assets classified as Loss are those considered uncollectible and of such little value that their continuance as assets without the establishment of a full loss reserve and/or charge-off is not warranted. Assets that do not currently expose the insured financial institutions to sufficient risk to warrant classification in one of the aforementioned categories but otherwise possess weaknesses are designated "Special Mention." Management also maintains a listing of loans designated “Watch.” These loans represent borrowers with declining earnings, strained cash flow, increasing leverage and/or weakening market fundamentals that indicate above average risk.

When The Bank of Greene County classifies problem assets as either Substandard, Doubtful or Loss, it generally establishes a specific valuation allowance or "loss reserve" in an amount deemed prudent by management. General allowances represent loss allowances that have been established to recognize the inherent risk associated with lending activities, but which, unlike specific allowances, have not been allocated to particular loans. When The Bank of Greene County identifies loans as being impaired, it is required to evaluate whether the Bank will be able to collect all amounts due either through repayments or the liquidation of the underlying collateral. If it is determined that impairment exists, the Bank is required either to establish a specific allowance for losses equal to the amount of impairment, or to charge-off such amount. The Bank of Greene County's determination as to the classification of its loans and the amount of its valuation allowance is subject to review by its regulatory agencies, which can order the establishment of additional general or specific loss allowances. The Bank of Greene County reviews its portfolio monthly to determine whether any assets require classification in accordance with applicable regulations.

The Bank primarily has three segments within its loan portfolio that it considers when measuring credit quality: real estate loans, consumer installment and commercial loans. The real estate portfolio consists of residential, nonresidential, and construction loan classes. The inherent risk within the loan portfolio varies depending upon each of these loan types.

The Bank of Greene County’s primary lending activity is the origination of residential mortgage loans, including home equity loans, which are collateralized by residences. Generally, residential mortgage loans are made in amounts up to 80.0% of the appraised value of the property. However, The Bank of Greene County will originate residential mortgage loans with loan-to-value ratios of up to 95.0%, with private mortgage insurance. In the event of default by the borrower, The Bank of Greene County will acquire and liquidate the underlying collateral. By originating the loan at a loan-to-value ratio of 80% or less or obtaining private mortgage insurance, The Bank of Greene County limits its risk of loss in the event of default. However, the market values of the collateral may be adversely impacted by declines in the economy. Home equity loans may have an additional inherent risk if The Bank of Greene County does not hold the first mortgage since The Bank of Greene County may stand in a secondary position in the event of collateral liquidation resulting in a greater chance of insufficiency to meet all obligations.

Construction lending generally involves a greater degree of risk than other residential mortgage lending. The repayment of the construction loan is, to a great degree, dependent upon the successful and timely completion of the construction of the subject property within specified cost limits. The Bank of Greene County completes inspections during the construction phase prior to any disbursements. The Bank of Greene County limits its risk during the construction as disbursements are not made until the required work for each advance has been completed. Construction delays may further impair the borrower's ability to repay the loan.

Loans collateralized by nonresidential mortgage loans, and multi-family loans, such as apartment buildings generally are larger than residential loans and involve a greater degree of risk. Commercial mortgage loans often involve large loan balances to single borrowers or groups of related borrowers. Payments on these loans depend to a large degree on the results of operations and management of the properties or underlying businesses, and may be affected to a greater extent by adverse conditions in the real estate market or the economy in general. Accordingly, the nature of nonresidential mortgage loans makes them more difficult for management to monitor and evaluate.

Consumer installment loans generally have shorter terms and higher interest rates than residential mortgage loans. In addition, consumer loans expand the products and services offered by The Bank of Greene County to better meet the financial services needs of its customers. Consumer loans generally involve greater credit risk than residential mortgage loans because of the difference in the nature of the underlying collateral. Repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment of the outstanding loan balance because of the greater likelihood of damage, loss or depreciation in the underlying collateral. The remaining deficiency often does not warrant further substantial collection efforts against the borrower beyond obtaining a deficiency judgment. In addition, consumer loan collections depend on the borrower's personal financial stability. Furthermore, the application of various federal and state laws, including federal and state bankruptcy and insolvency laws, may limit the amount that can be recovered on such loans.

Commercial lending generally involves greater risk than residential mortgage lending and involves risks that are different from those associated with residential and nonresidential mortgage lending. Real estate lending is generally considered to be collateral based, with loan amounts based on fixed-rate loan-to-collateral values, and liquidation of the underlying real estate collateral is viewed as the primary source of repayment in the event of borrower default. Although commercial loans may be collateralized by equipment or other business assets, the liquidation of collateral in the event of a borrower default is often an insufficient source of repayment because equipment and other business assets may be obsolete or of limited use, among other things. Accordingly, the repayment of a commercial loan depends primarily on the creditworthiness of the borrower (and any guarantors), while liquidation of collateral is a secondary and often insufficient source of repayment.

Loan balances by internal credit quality indicator as of March 31, 2012 are shown below.

(in thousands)	Performing		Watch		Special Mention		Substandard		Total
Residential mortgage	$	182,157	$	---	$	563	$	4,101	$	186,821
Nonresidential mortgage		67,669		7		592		2,641		70,909
Residential construction & land		2,829		---		---		---		2,829
Commercial construction		2,014		---		290		1,069		3,373
Multi-family		4,235		---		784		562		5,581
Home equity		23,576		---		---		101		23,677
Consumer installment		4,036		52		---		19		4,107
Commercial loans		18,793		10		834		741		20,378
Total gross loans	$	305,309	$	69	$	3,063	$	9,234	$	317,675

Loan balances by internal credit quality indicator as of June 30, 2011 are shown below.

(in thousands)	Performing		Watch		Special Mention		Substandard		Total
Residential mortgage	$	176,615	$	1,782	$	95	$	3,120	$	181,612
Nonresidential mortgage		59,633		1,017		602		2,608		63,860
Residential construction & land		3,718		---		---		13		3,731
Commercial construction		1,789		---		---		225		2,014
Multi-family		5,036		---		434		578		6,048
Home equity		25,446		64		---		49		25,559
Consumer installment		3,960		7		---		41		4,008
Commercial loans		17,149		274		680		685		18,788
Total gross loans	$	293,346	$	3,144	$	1,811	$	7,319	$	305,620

The Company had no loans classified Doubtful or Loss at March 31, 2012 or June 30, 2011.

Nonaccrual Loans

Management places loans on nonaccrual status once the loans have become 90 days or more delinquent. Nonaccrual is defined as a loan in which collectability is questionable and therefore interest on the loan will no longer be recognized on an accrual basis. A loan is not placed back on accrual status until the borrower has demonstrated the ability and willingness to make timely payments on the loan. A loan does not have to be 90 days delinquent in order to be classified as nonaccrual. Nonaccrual loans consisted primarily of loans secured by real estate at March 31, 2012 and June 30, 2011. While the Bank makes every reasonable effort to work with the borrowers to collect amounts due, the number of loans in process of foreclosure has grown substantially over the past several years. This growth has been the result of adverse changes within the economy and increases in local unemployment. The growth is also due in part to the extended length of time required to meet all of the legal requirements mandated by New York State law prior to a foreclosure sale, which may be in excess of two years. Loans on nonaccrual status totaled $6.8 million at March 31, 2012 of which $2.9 million were in the process of foreclosure. Of the remaining $3.9 million in nonaccrual loans, $2.8 million were less than 90 days past due, or were current at March 31, 2012, but have a recent history of delinquency greater than 90 days past due. These loans will be returned to accrual status once they have demonstrated a history of timely payments. Of total delinquent loans, $922,000 were making payments pursuant to forbearance agreements. Under the forbearance agreements, the customers have made arrangements with the Bank to bring the loans current over a specified period of time (resulting in an insignificant delay in repayment). During this term of the forbearance agreement, the Bank has agreed not to continue foreclosure proceedings.

The following table sets forth information regarding delinquent and/or nonaccrual loans as of March 31, 2012:

(in thousands)	30-59 days past due		60-89 days past due		More than 90 days past due		Total past due		Current		Total Loans		Loans on Non-accrual
Residential mortgage	$	2,402	$	---	$	3,248	$	5,650	$	181,171	$	186,821	$	4,015
Nonresidential mortgage		1,615		---		1,073		2,688		68,221		70,909		2,062
Residential construction & land		---		---		---		---		2,829		2,829		---
Commercial construction		---		---		---		---		3,373		3,373		---
Multi-family		---		---		434		434		5,147		5,581		434
Home equity		---		23		101		124		23,553		23,677		60
Consumer installment		46		52		20		118		3,989		4,107		19
Commercial loans		674		---		249		923		19,455		20,378		202
Total gross loans	$	4,737	$	75	$	5,125	$	9,937	$	307,738	$	317,675	$	6,792

The following table sets forth information regarding delinquent and/or nonaccrual loans as of June 30, 2011:

(in thousands)	30-59 days past due		60-89 days past due		More than 90 days past due		Total past due		Current		Total Loans		Loans on Non-accrual
Residential mortgage	$	1,766	$	1,292	$	2,294	$	5,352	$	176,260	$	181,612	$	3,074
Nonresidential mortgage		1,163		687		1,799		3,649		60,211		63,860		2,171
Residential construction & land		---		---		13		13		3,718		3,731		13
Commercial construction		225		---		---		225		1,789		2,014		225
Multi-family		128		---		449		577		5,471		6,048		577
Home equity		168		64		43		275		25,284		25,559		49
Consumer installment		31		25		13		69		3,939		4,008		41
Commercial loans		69		546		82		697		18,091		18,788		144
Total gross loans	$	3,550	$	2,614	$	4,693	$	10,857	$	294,763	$	305,620	$	6,294

The Bank of Greene County had one accruing loan delinquent more than 90 days as of March 31, 2012 totaling $41,000 and had no accruing loans delinquent more than 90 days as of June 30, 2011. The loan delinquent more than 90 days and accruing consists of a loan that is well collateralized and the borrower has demonstrated the ability and willingness to pay. The borrower has made arrangements with the Bank to bring the loan current within a specified time period and has made a series of payments as agreed.

The table below details additional information related to nonaccrual loans for the nine months ended March 31:


(In thousands)	2012		2011
Interest income that would have been recorded if loans had been performing in accordance with original terms	$	442	$	458
Interest income that was recorded on nonaccrual loans during the nine months ended		211		176

Impaired Loan Analysis

The Company identifies impaired loans and measures the impairment in accordance with FASB ASC subtopic “Receivables – Loan Impairment.” Management may consider a loan impaired once it is classified as nonaccrual and when it is probable that the borrower will be unable to repay the loan according to the original contractual terms of the loan agreement or the loan is restructured in a troubled debt restructuring. Management does not evaluate all loans individually for impairment. The Bank of Greene County considers residential mortgages, home equity loans, smaller commercial loans and installment loans as small, homogeneous loans, which are evaluated for impairment collectively based on historical loss experience and other factors. In contrast, large commercial mortgage, construction, multi-family and business loans are viewed individually and considered impaired if it is probable that The Bank of Greene County will not be able to collect scheduled payments of principal and interest when due, according to the contractual terms of the loan agreement. The measurement of impaired loans is generally based on the fair value of the underlying collateral. The majority of The Bank of Greene County loans, including most nonaccrual loans, are small homogenous loan types adequately supported by collateral. As a result, the level of impaired loans may only be a portion of nonaccrual loans. Loans that are delinquent or slow paying may not be impaired, especially small homogenous loan types, due to collateral adequacy. Management considers the payment status of loans in the process of evaluating the adequacy of the allowance for loan losses among other factors. Loans that are either delinquent a minimum of 60 days or are on nonaccrual status, and are not individually considered impaired, are either designated as Special Mention or Substandard, and the allocation of the allowance for loan loss is based upon the risk associated with such designation.

The tables below detail additional information on impaired loans for the periods indicated:

	As of March 31, 2012						For the nine months ended March 31, 2012
(in thousands)	Recorded Investment		Unpaid Principal		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Residential mortgage	$	213	$	276	$	---	$	213	$	---
Nonresidential mortgage		1,153		1,153		---		535		40
Multi-family		437		437		---		49		4
Total loans with no related allowance		1,803		1,866		---		797		44
With an allowance recorded:
Residential mortgage		201		201		14		106		4
Nonresidential mortgage		649		649		146		819		19
Commercial construction		1,069		1,069		412		119		5
Multi-family		430		430		155		432		18
Commercial loans		562		562		51		535		27
Total loans with related allowance		2,911		2,911		778		2,011		73
Total impaired loans:
Residential mortgage		414		477		14		319		4
Nonresidential mortgage		1,802		1,802		146		1,354		59
Commercial construction		1,069		1,069		412		119		5
Multi-family		867		867		155		481		22
Commercial loans		562		562		51		535		27
Total impaired loans	$	4,714	$	4,777	$	778	$	2,808	$	117

	As of June 30, 2011						For the nine months ended March 31, 2011
(in thousands)	Recorded Investment		Unpaid Principal		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Residential mortgage	$	213	$	276	$	---	$	394	$	4
Nonresidential mortgage		462		462		---		---		---
Total loans with no related allowance		675		738		---		394		4
With an allowance recorded:
Residential mortgage		46		46		2		---		---
Nonresidential mortgage		1,255		1,255		292		374		6
Multi-family		434		434		160		---		---
Commercial loans		500		500		12		---		---
Total loans with related allowance		2,235		2,235		466		374		6
Total impaired loans:
Residential mortgage		259		322		2		394		4
Nonresidential mortgage		1,717		1,717		292		374		6
Multi-family		434		434		160		---		---
Commercial loans		500		500		12		---		---
Total impaired loans	$	2,910	$	2,973	$	466	$	768	$	10

As a result of adopting the guidance issued by FASB regarding “A Creditor’s Determination of Whether a Restructuring Is a Troubled Debt Restructuring”, the Company reassessed all restructurings that occurred on or after June 30, 2011 for identification as troubled debt restructurings. During the quarter ended March 31, 2012, the Company identified two residential mortgage loans for which the allowance for loan losses had previously been measured under a general allowance for credit losses methodology that are now considered troubled debt restructurings in accordance with this new guidance. At March 31, 2012, the recorded investment in receivables for which the allowance for credit losses was previously measured under a general allowance for credit losses methodology and are now impaired was $155,000, and the allowance for credit losses associated with those loans was $12,000. The pre-modification outstanding recorded investment on these two loans was $246,000, and the post-modification outstanding recorded investment was $156,000. These loans have been classified as troubled-debt restructurings due to concessions granted to the debtor that The Bank of Greene County would not otherwise consider as a result of financial difficulties of the borrower. For each of these loans, a portion of the principal and/or interest was forgiven, the interest rate was reduced and the term extended. At March 31, 2012, neither of these loans were in default, however, these loans are currently included in non-accrual loans. If the borrower performs under the terms of the modification, and the ultimate collectability of all amounts contractually due under the modified terms is not in doubt, the loans will be returned to accrual status.

Allowance for Loan Losses

The allowance for loan losses is established through a provision for loan losses based on management’s evaluation of the losses inherent in the loan portfolio, the composition of the loan portfolio, specific impaired loans and current economic conditions. Such evaluation, which includes a review of all loans on which full collectability may not be reasonably assured, considers among other matters, the estimated net realizable value or the fair value of the underlying collateral, economic conditions, payment status of the loan, historical loan loss experience and other factors that warrant recognition in providing for the loan loss allowance. In addition, various regulatory agencies, as an integral part of their examination process, periodically review The Bank of Greene County’s allowance for loan losses. Such agencies may require The Bank of Greene County to recognize additions to the allowance based on their judgment about information available to them at the time of their examination. The Bank of Greene County charges loans off against the allowance for credit losses when it becomes evident that a loan cannot be collected within a reasonable amount of time or that it will cost the Bank more to collect the loan than it will receive, and all reasonable avenues of repayment have been analyzed, including the potential of future cash flow, the value of the underlying collateral, and strength of any guarantors or co-borrowers. Generally, consumer loans and smaller business loans (not secured by real estate) in excess of 90 days are charged-off against the allowance for loan losses, unless equitable arrangements are made. For loans secured by real estate, a charge-off is recorded when it is determined that the collection of all or a portion of a loan may not be collected and the amount of that loss can be reasonably estimated.

The following tables set forth the activity and allocation of the allowance for loan losses by loan category during and at the periods indicated. The allowance is allocated to each loan category based on historical loss experience and economic conditions.

Activity for the three months ended March 31, 2012

(In thousands)	Balance December 31, 2011		Charge-offs		Recoveries		Provision			Balance March 31, 2012
Residential mortgage	$	2,147	$	115	$	---	$	66		$	2,098
Nonresidential mortgage		1,947		---		---		(83	)		1,864
Residential construction & land		31		---		---		(8	)		23
Commercial construction		78		---		---		402			480
Multi-family		408		---		---		(55	)		353
Home equity		217		---		---		(23	)		194
Consumer installment		233		64		23		119			311
Commercial loans		556		35		---		90			611
Unallocated		---		---		---		33			33
Total	$	5,617	$	214	$	23	$	541		$	5,967

Activity for the nine months ended March 31, 2012

(In thousands)	Balance June 30, 2011		Charge-offs		Recoveries		Provision			Balance March 31, 2012
Residential mortgage	$	1,767	$	172	$	4	$	499		$	2,098
Nonresidential mortgage		1,859		212		---		217			1,864
Residential construction & land		27		---		---		(4	)		23
Commercial construction		89		---		---		391			480
Multi-family		410		---		---		(57	)		353
Home equity		186		---		---		8			194
Consumer installment		203		183		57		234			311
Commercial loans		528		35		2		116			611
Unallocated		---		---		---		33			33
Total	$	5,069	$	602	$	63	$	1,437		$	5,967

	Allowance for Loan Loss			Loans Receivable
	Ending Balance March 31, 2012 Impairment Analysis		Ending Balance March 31, 2012 Impairment Analysis
(In thousands)	Individually Evaluated	Collectively Evaluated	Individually Evaluated		Collectively Evaluated
Residential mortgage	$14	$2,084	$414		$186,407
Nonresidential mortgage	146	1,718	1,802		69,107
Residential construction & land	---	23	---		2,829
Commercial construction	412	68	1,069		2,304
Multi-family	155	198	867		4,714
Home equity	---	194	---		23,677
Consumer installment	---	311	---		4,107
Commercial loans	51	560	562		19,816
Unallocated	---	33	---		---
Total	$778	$5,189	$4,714		$312,961

Activity for the three months ended March 31, 2011

(In thousands)	Balance December 31, 2010		Charge-offs		Recoveries		Provision			Balance March 31, 2011
Residential mortgage	$	1,758	$	3	$	---	$	(24	)	$	1,731
Nonresidential mortgage		1,660		78		---		318			1,900
Residential construction & land		33		---		---		(8	)		25
Commercial construction		49		---		---		(18	)		31
Multi-family		235		---		---		6			241
Home equity		216		---		---		(5	)		211
Consumer installment		157		62		34		70			199
Commercial loans		541		7		---		4			538
Total	$	4,649	$	150	$	34	$	343		$	4,876

Activity for the nine months ended March 31, 2011

(In thousands)	Balance June 30, 2010		Charge-offs		Recoveries		Provision			Balance March 31, 2011
Residential mortgage	$	1,427	$	140	$	---	$	443		$	1,731
Nonresidential mortgage		1,517		78		---		461			1,900
Residential construction & land		48		---		---		(23	)		25
Commercial construction		49		---		---		(18	)		31
Multi-family		223		---		---		18			241
Home equity		205		---		---		6			211
Consumer installment		120		185		76		188			199
Commercial loans		435		9		8		104			538
Total	$	4,024	$	412	$	84	$	1,179		$	4,876

	Allowance for Loan Loss		Loans Receivable
	Ending Balance June 30, 2011 Impairment Analysis			Ending Balance June 30, 2011 Impairment Analysis
(In thousands)	Individually Evaluated	Collectively Evaluated		Individually Evaluated	Collectively Evaluated
Residential mortgage	$2	$1,765		$259	$181,353
Nonresidential mortgage	292	1,567		1,717	62,143
Residential construction & land	---	27		---	3,731
Commercial construction	---	89		---	2,014
Multi-family	160	250		434	5,614
Home equity	---	186		---	25,559
Consumer installment	---	203		---	4,008
Commercial loans	12	516		500	18,288
Total	$466	$4,603		$2,910	$302,710

(6) Fair Value Measurements and Fair Value of Financial Instruments

Management uses its best judgment in estimating the fair value of the Company’s financial instruments; however, there are inherent weaknesses in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates herein are not necessarily indicative of the amounts the Company could have realized in a sale transaction on the dates indicated. The estimated fair value amounts have been measured as of March 31, 2012 and June 30, 2011 and have not been re-evaluated or updated for purposes of these consolidated financial statements subsequent to those respective dates. As such, the estimated fair values of these financial instruments subsequent to the respective reporting dates may be different than the amounts reported at each period-end.

The following information should not be interpreted as an estimate of the fair value of the entire Company since a fair value calculation is only provided for a limited portion of the Company’s assets and liabilities. Due to a wide range of valuation techniques and the degree of subjectivity used in making the estimates, comparisons between the Company’s disclosures and those of other companies may not be meaningful.

The FASB ASC Topic on “Fair Value Measurement” established a fair value hierarchy that prioritized the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2: Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability.

Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported with little or no market activity).

An asset’s or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement.

For assets measured at fair value on a recurring basis, the fair value measurements by level within the fair value hierarchy used are as follows:

	March		Fair Value Measurements Using
(In thousands)		31, 2012	(Level 1)		(Level 2)		(Level 3)
Assets:
U.S. Government sponsored enterprises	$	20,093	$	---	$	20,093	$	---
State and political subdivisions		5,592		---		5,592		---
Mortgage-backed securities-residential		24,433		14,459		9,974		---
Mortgage-backed securities-multi-family		17,580		17,580		---		---
Asset-backed securities		20		20		---		---
Corporate debt securities		6,361		6,361		---		---
Equity securities		126		126		---		---
Securities available-for-sale	$	74,205	$	38,546	$	35,659	$	---

	June		Fair Value Measurements Using
(In thousands)		30, 2011	(Level 1)		(Level 2)		(Level 3)
Assets:
U.S. Government sponsored enterprises	$	25,703	$	---	$	25,703	$	---
State and political subdivisions		7,062		---		7,062		---
Mortgage-backed securities-residential		28,914		20,842		8,072		---
Mortgage-backed securities-multi-family		21,096		21,096		---		---
Asset-backed securities		23		23		---		---
Corporate debt securities		7,206		7,206		---		---
Equity securities		113		113		---		---
Securities available-for-sale	$	90,117	$	49,280	$	40,837	$	---

Certain investments that are actively traded and have quoted market prices have been classified as Level 1 valuations. Other available-for-sale investment securities have been valued by reference to prices for similar securities or through model-based techniques in which all significant inputs are observable and, therefore, such valuations have been classified as Level 2.

In addition to disclosures of the fair value of assets on a recurring basis, FASB ASC Topic on “Fair Value Measurement” requires disclosures for assets and liabilities measured at fair value on a nonrecurring basis, such as impaired assets, in the period in which a re-measurement at fair value is recorded. Loans are generally not recorded at fair value on a recurring basis. Periodically, the Company records nonrecurring adjustments to the carrying value of loans based on fair value measurements for partial charge-offs of the uncollectible portions of those loans. Nonrecurring adjustments also include certain impairment amounts for collateral-dependent loans calculated as required by the “Receivables –Loan Impairment” subtopic of the FASB ASC when establishing the allowance for credit losses. Impaired loans are those loans for which the Company has re-measured impairment generally based on the fair value of the underlying collateral supporting the loan and, as a result, the carrying value of the loan exceeds the fair value of the loan. Real estate collateral is typically valued using independent appraisals or other indications of value based on recent comparable sales of similar properties or assumptions generally observable in the marketplace and the related nonrecurring fair value measurement adjustments have generally been classified as Level 3.

	March		Fair Value Measurements Using
(In thousands)		31, 2012	(Level 1)		(Level 2)		(Level 3)
Collateral dependent impaired loans	$	2,133	$	---	$	---	$	2,133


	June		Fair Value Measurements Using
(In thousands)		30, 2011	(Level 1)		(Level 2)		(Level 3)
Collateral dependent impaired loans	$	1,769	$	---	$	---	$	1,769

The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which Level 3 inputs were utilized to determine fair value:

	March
(In thousands)	31, 2012	Valuation Technique	Unobservable Input	Range
Collateral dependent impaired loans	$2,133	Appraisal of collateral	Appraisal adjustments	0-25%
			Liquidation expenses	10-15%

At March 31, 2012, loans subject to nonrecurring fair value measurement had a recorded investment of $2.1 million with related allowances of $778,000, and consisted of three residential mortgage loans, five nonresidential mortgage loans, one multifamily loan and one commercial loan. At June 30, 2011, loans subject to nonrecurring fair value measurement had a recorded investment of $1.8 million with related allowance of $466,000, and consisted of two residential mortgage loans, six nonresidential mortgage loans, one multifamily loan and one commercial loan. The change in fair value of each of the impaired loans for the three and nine months ended March 31, 2012 was immaterial. During the nine months ended March 31, 2012, two nonresidential mortgage loans were transferred to foreclosed real estate at their fair value of $430,000, and two land loan was transferred to foreclosed real estate at its fair value of $163,000, and one residential loan was transferred to foreclosed real estate at its fair value of $60,000. No other financial assets or liabilities were re-measured during the year on a nonrecurring basis.

The carrying amounts reported in the statements of financial condition for cash and cash equivalents, accrued interest receivable and accrued interest payable approximate their fair values. Fair values of securities are based on quoted market prices (Level 1), where available, or matrix pricing (Level 2), which is a mathematical technique, used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted prices. The carrying amount of Federal Home Loan Bank stock approximates fair value due to its restricted nature. Fair values for variable rate loans that reprice frequently, with no significant credit risk, are based on carrying value. Fair value for fixed rate loans are estimated using discounted cash flows and interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. Fair values disclosed for demand and savings deposits are equal to carrying amounts at the reporting date. The carrying amounts for variable rate money market deposits approximate fair values at the reporting date. Fair values for fixed rate certificates of deposit are estimated using discounted cash flows and interest rates currently being offered in the market on similar certificates. Fair value for Federal Home Loan Bank borrowings are estimated using discounted cash flows and interest rates currently being offered on similar advances.

The fair value of commitments to extend credit is estimated based on an analysis of the interest rates and fees currently charged to enter into similar transactions, considering the remaining terms of the commitments and the credit-worthiness of the potential borrowers. At March 31, 2012 and June 30, 2011, the estimated fair values of these off-balance sheet financial instruments were immaterial, and are therefore excluded from the table below.

The carrying amounts and estimated fair value of financial instruments are as follows:

(in thousands)	March 31, 2012				Fair Value Measurements Using
	Carrying Amount		Fair Value		(Level 1)		(Level 2)		(Level 3)
Cash and cash equivalents	$	30,876	$	30,876	$	30,876	$	---	$	---
Securities available-for-sale		74,205		74,205		38,546		35,659		---
Securities held-to-maturity		139,444		142,679		52,590		90,089
Federal Home Loan Bank stock		1,138		1,138		1,138		---		---
Net loans		312,122		325,574		---		---		325,574
Accrued interest receivable		2,802		2,802		2,802		---		---
Deposits		514,597		514,888		439,502		75,386		---
Federal Home Loan Bank borrowings		9,000		9,445		---		9,445		---
Accrued interest payable		98		98		98		---		---

(in thousands)	June 30, 2011
	Carrying		Fair
	Amount		Value
Cash and cash equivalents	$	9,966	$	9,966
Securities available-for-sale		90,117		90,117
Securities held-to-maturity		124,177		126,205
Federal Home Loan Bank stock		1,916		1,916
Net loans		301,046		309,567
Accrued interest receivable		2,716		2,716
Deposits		469,897		470,444
Federal Home Loan Bank borrowings		26,300		26,941
Accrued interest payable		98		98

(7) Earnings Per Share (“EPS”)

Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed in a manner similar to that of basic earnings per share except that the weighted-average number of common shares outstanding is increased to include the number of incremental common shares that would have been outstanding under the treasury stock method if all potentially dilutive common shares (such as stock options) issued became vested during the period. There were no anti-dilutive securities or contracts outstanding during the nine and three months ended March 31, 2012 and 2011.

		Weighted Average Number
	Net Income	Of Shares Outstanding	Earnings per Share
Nine months ended
March 31, 2012	$4,487,000
Basic		4,150,978	$1.08
Effect of dilutive stock options		41,589	(0.01)
Diluted		4,192,567	$1.07

Nine months ended
March 31, 2011	$3,915,000
Basic		4,131,052	$0.95
Effect of dilutive stock options		31,664	(0.01)
Diluted		4,162,716	$0.94

		Weighted Average Number
	Net Income	Of Shares Outstanding	Earnings per Share
Three months ended
March 31, 2012	$1,483,000
Basic		4,159,093	$0.36
Effect of dilutive stock options		38,337	(0.01)
Diluted		4,197,430	$0.35

Three months ended
March 31, 2011	$1,239,000
Basic		4,142,160	$0.30
Effect of dilutive stock options		29,967	(0.00)
Diluted		4,172,127	$0.30

(8) Dividends

On January 17, 2012, the Board of Directors declared a quarterly cash dividend of $0.175 per share of Greene County Bancorp, Inc.’s common stock. The dividend, which reflected an annual cash dividend rate of $0.70 cents per share, was unchanged from the dividend declared during the previous quarter. The dividend was payable to stockholders of record as of February 15, 2012, and was paid on March 1, 2012. Greene County Bancorp, Inc.’s mutual holding company waived receipt of dividends for all periods presented.

(9) Impact of Recent Accounting Pronouncements

In January 2010, the FASB issued amendments to its guidance on “Fair Value Measurements and Disclosures – Overall Subtopic” The amendment requires new disclosures as follows: (1) For transfers in and out of Level 1 and 2 fair value measurements, a reporting entity should disclose separately the amounts of significant transfers and describe the reasons for the transfers, and (2) for the reconciliation for value measurements using significant unobservable inputs (Level 3), a reporting entity should present separately information about purchases, sales, issuances, and settlements (that is, on a gross basis rather than as one net number). The amendment also clarifies existing disclosure requirements relating to the level of disaggregation of each class of assets or liabilities within a line item in the statement of financial position and the inputs and valuation techniques utilized to measure fair value for both recurring and nonrecurring fair value measurements. Those disclosures are required for fair value measurements that fall in either Level 2 or Level 3. The new disclosures and clarifications of existing disclosures are effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements. Those disclosures are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. The adoption of these amendments did not have a material effect on our consolidated results of operations or financial position.

(10) Employee Benefit Plans

Defined Benefit Plan

The components of net periodic pension costs related to the defined benefit pension plan for the nine and three months ended March 31, 2012 and 2011 were as follows:

	Nine months ended March 31,						Three months ended March 31,
(in thousands)	2012			2011			2012			2011
Interest cost	$	161		$	153		$	53		$	51
Expected return on plan assets		(168	)		(165	)		(56	)		(55	)
Amortization of net loss		27			23			9			7
Net periodic pension cost	$	20		$	11		$	6		$	3

The Company does not expect to make any contributions to the defined benefit pension plan during fiscal 2012.

SERP

On June 21, 2010, the Board of Directors of The Bank of Greene County adopted The Bank of Greene County Supplemental Executive Retirement Plan (the “SERP Plan”), effective as of July 1, 2010. The SERP Plan will benefit certain key senior executives of the Bank who are selected by the Board to participate.

The SERP Plan is intended to provide a benefit from the Bank upon retirement, death or disability or voluntary or involuntary termination of service (other than “for cause”). Accordingly, the SERP Plan obligates the Bank to make a contribution to each executive’s account on the first business day of each July and permits each executive to defer up to 50% of his or her base salary and 100% of his or her annual bonus to the SERP Plan, subject to the requirements of Section 409A of the Internal Revenue Code (“Code”). In addition, the Bank may, but is not required to, make additional discretionary contributions to the executives’ accounts from time to time. An executive becomes vested in the Bank’s contributions after 10 calendar years of service following the effective date of the SERP Plan, and is fully vested immediately for all deferral of salary and bonus. However, the Executive will vest in the present value of his or her account in the event of death, disability or a change in control of the Bank or the Company. In the event the executive is terminated involuntarily or resigns for good reason following a change in control, the present value of all remaining Bank contributions is accelerated and paid to the executive’s account, subject to potential reduction to avoid an excess parachute payment under Code Section 280G. In the event of the executive’s death, disability or termination within two years after a change in control, executive’s account will be paid in a lump sum to the executive or his beneficiary, as applicable. In the event executive is entitled to a benefit from the SERP Plan due to retirement or other termination of employment, the benefit will be paid in 10 annual installments.

The net periodic pension costs related to the SERP for the three and nine months ended March 31, 2012 were $18,000 and $60,000, respectively, consisting primarily of service and interest costs. The net periodic pension costs related to the SERP for the three and nine months ended March 31, 2011 were $13,000 and $39,000, respectively, consisting primarily of service costs. Interest costs associated with this plan were not material for the three and nine months ended March 31, 2011. The accumulated obligation for the SERP was $260,400 and $98,300 as of March 31, 2012 and June 30, 2011, respectively.

(11) Stock-Based Compensation

At March 31, 2012, Greene County Bancorp, Inc. had one stock-based compensation plan, which is described more fully in Note 9 of the consolidated financial statements and notes thereto for the year ended June 30, 2011.

The Company recognized $19,000 and $167,000 in compensation costs and related income tax benefit of $6,000 and $51,000 related to the 2008 Option Plan for the nine months ended March 31, 2012 and 2011, respectively. On August 19, 2011, all granted shares became fully vested, therefore, no remaining compensation cost will be recognized after that date.

A summary of the Company’s stock option activity and related information for its option plans for the nine months ended March 31, 2012 and 2011 is as follows:

	2012		2011
		Weighted Average		Weighted Average
		Exercise		Exercise
		Price		Price
	Shares	Per Share	Shares	Per Share
Outstanding at beginning of year	144,834	$12.50	171,750	$12.36
Exercised	(22,234)	---	(26,916)	11.61
Outstanding at period end	122,600	$12.50	144,834	$12.50
Exercisable at period end	122,600	$12.50	90,338	$12.50

The following table presents stock options outstanding and exercisable at March 31, 2012:

Options Outstanding and Exercisable
Range of Exercise Prices	Number Outstanding	Weighted Average Remaining Contractual Life	Weighted Average Exercise Price
$12.50	122,600	6.50	$12.50

The total intrinsic value of the options exercised during the three and nine months ended March 31, 2012 was approximately $90,000 and $113,000, respectively. The total intrinsic value of the options exercised during the three and nine months ended March 31, 2011, was approximately $69,000, and $160,000, respectively. There were no stock options granted during the nine months ended March 31, 2012 or 2011. The Company had no non-vested options outstanding at March 31, 2012 and 54,496 non-vested options outstanding at March 31, 2011.

Phantom Stock Option Plan and Long-term Incentive Plan

On July 12, 2011, Greene County Bancorp, Inc. (the “Company”) entered into the Greene County Bancorp, Inc. 2011 Phantom Stock Option and Long-term Incentive Plan (the “Plan”), effective as of July 1, 2011, to promote the long-term financial success of the Company and its subsidiaries by providing a means to attract, retain and reward individuals who contribute to such success and to further align their interests with those of the Company’s shareholders. The Plan is intended to provide benefits to employees and directors of the Company or any subsidiary as designated by the Compensation Committee of the Board of Directors of the Company (“Committee”). A total of 900,000 phantom stock options will be available for awards under the Plan. A phantom stock option represents the right to receive a cash payment on the date the award vests in the participant equal to the positive difference between the strike price on the grant date and the book value of a share of the Company stock on the determination date, which is the last day of the plan year that is the end of the third plan year after the grant date of the award, unless otherwise specified by the Committee. The strike price will be the price established by the Committee, which will not be less than 100% of the book value of a share on a specified date, as determined under generally accepted accounting principles (GAAP) as of the last day of the quarter ending on or immediately preceding the valuation date with adjustments made, in the sole discretion of the Committee, to exclude accumulated other comprehensive income. During the nine months ended March 31, 2012, 235,350 phantom stock options were awarded under the plan. The Company recognized $67,800 and $203,400 in compensation costs related to the phantom stock option plan during the three and nine months ended March 31, 2012, respectively.

(12) Accumulated Other Comprehensive Income

The components of accumulated other comprehensive income as of March 31, 2012 and June 30, 2011 are presented in the following table:

(in thousands)
	March 31, 2012	June 30, 2011
Unrealized gains on available-for-sale securities, net of tax	$1,091	$1,238
Unrealized loss on securities transferred to held-to-maturity, net of tax	(42)	(70)
Net losses and past service liability for defined benefit plan, net of tax	(636)	(649)
Accumulated other comprehensive income	$413	$519

(13) Subsequent events

On April 17, 2012, the Board of Directors declared a quarterly cash dividend of $0.175 per share on Greene County Bancorp, Inc.’s common stock. The dividend reflects an annual cash dividend rate of $0.70 per share, which was the same as the dividend declared during the previous quarter. The dividend will be payable to stockholders of record as of May 15, 2012, and will be paid on June 1, 2012. Greene County Bancorp, MHC has waived the right to receive its portion of the dividend.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation

Overview of the Company’s Activities and Risks

Greene County Bancorp, Inc.’s results of operations depend primarily on its net interest income, which is the difference between the income earned on Greene County Bancorp, Inc.’s loan and securities portfolios and its cost of funds, consisting of the interest paid on deposits and borrowings. Results of operations are also affected by Greene County Bancorp, Inc.’s provision for loan losses, gains and losses from sales of securities, noninterest income and noninterest expense. Noninterest income consists primarily of fees and service charges. Greene County Bancorp, Inc.’s noninterest expense consists principally of compensation and employee benefits, occupancy, equipment and data processing, and other operating expenses. Results of operations are also significantly affected by general economic and competitive conditions, changes in interest rates, as well as government policies and actions of regulatory authorities. Additionally, future changes in applicable law, regulations or government policies may materially affect Greene County Bancorp, Inc.

To operate successfully, the Company must manage various types of risk, including but not limited to, market or interest rate risk, credit risk, transaction risk, liquidity risk, security risk, strategic risk, reputation risk and compliance risk. While all of these risks are important, the risks of greatest significance to the Company relate to market or interest rate risk and credit risk.

Market risk is the risk of loss from adverse changes in market prices and/or interest rates. Since net interest income (the difference between interest earned on loans and investments and interest paid on deposits and borrowings) is the Company’s primary source of revenue, interest rate risk is the most significant non-credit related market risk to which the Company is exposed. Net interest income is affected by changes in interest rates as well as fluctuations in the level and duration of the Company’s assets and liabilities.

Interest rate risk is the exposure of the Company’s net interest income to adverse movements in interest rates. In addition to directly impacting net interest income, changes in interest rates can also affect the amount of new loan originations, the ability of borrowers and debt issuers to repay loans and debt securities, the volume of loan repayments and refinancings, and the flow and mix of deposits.

Credit risk is the risk to the Company’s earnings and shareholders’ equity that results from customers, to whom loans have been made and to the issuers of debt securities in which the Company has invested, failing to repay their obligations. The magnitude of risk depends on the capacity and willingness of borrowers and debt issuers to repay and the sufficiency of the value of collateral obtained to secure the loans made or investments purchased.

Special Note Regarding Forward Looking Statements

This quarterly report contains forward-looking statements. Greene County Bancorp, Inc. desires to take advantage of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 and is including this statement for the express purpose of availing itself of the protections of the safe harbor with respect to all such forward-looking statements. These forward-looking statements, which are included in this Management’s Discussion and Analysis and elsewhere in this quarterly report, describe future plans or strategies and include Greene County Bancorp, Inc.’s expectations of future financial results. The words “believe,” “expect,” “anticipate,” “project,” and similar expressions identify forward-looking statements. Greene County Bancorp, Inc.’s ability to predict results or the effect of future plans or strategies or qualitative or quantitative changes based on market risk exposure is inherently uncertain. Factors that could affect actual results include but are not limited to:

(a)	changes in general market interest rates,

(b)	general economic conditions, including unemployment rates and real estate values,

(c)	legislative and regulatory changes,

(d)	monetary and fiscal policies of the U.S. Treasury and the Federal Reserve,

(e)	changes in the quality or composition of The Bank of Greene County’s loan portfolio or the consolidated investment portfolios of The Bank of Greene County and Greene County Bancorp, Inc.,

(f)	deposit flows,

(g)	competition, and

(h)	demand for financial services in Greene County Bancorp, Inc.’s market area.

These factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements, since results in future periods may differ materially from those currently expected because of various risks and uncertainties.

Comparison of Financial Condition as of March 31, 2012 and June 30, 2011

ASSETS

Total assets of the Company were $578.7 million at March 31, 2012 as compared to $547.5 million at June 30, 2011, an increase of $31.2 million, or 5.7%. Securities available for sale and held to maturity amounted to $213.6 million, or 36.9% of assets, at March 31, 2012 as compared to $214.3 million, or 39.1% of assets, at June 30, 2011, a decrease of $645,000. Net loans grew by $11.1 million or 3.7% to $312.1 million at March 31, 2012 as compared to $301.0 million at June 30, 2011.

CASH AND CASH EQUIVALENTS

Total cash and cash equivalents increased to $30.9 million at March 31, 2012 as compared to $10.0 million at June 30, 2011, an increase of $20.9 million. The level of cash and cash equivalents is a function of the daily account clearing needs and deposit levels as well as activities associated with securities transactions and loan funding. All of these items can cause cash levels to fluctuate significantly on a daily basis.

SECURITIES

Securities, including both available-for-sale and held-to-maturity issues, decreased $645,000 to $213.6 million at March 31, 2012 as compared to $214.3 million at June 30, 2011. Securities purchases totaled $40.6 million during the nine months ended March 31, 2012 and consisted of $27.9 million in state and political subdivision securities and $12.7 million in mortgage-backed securities. Principal pay-downs and maturities amounted to $39.5 million, of which $22.5 million were mortgage-backed securities, $11.0 million were state and political subdivision securities and $6.0 million were U.S. government agency securities. Additionally, during the nine months ended March 31, 2012, corporate debt securities sold totaled $759,000, resulting in a realized gain of $11,000, and unrealized net gains on available for sale securities decreased $228,000. Greene County Bancorp, Inc. holds 27.5% of the securities portfolio at March 31, 2012 in state and political subdivision securities to take advantage of tax savings and to promote Greene County Bancorp, Inc.’s participation in the communities in which it operates. Mortgage-backed securities and asset-backed securities held within the portfolio do not contain sub-prime loans and are not exposed to the credit risk associated with such lending.

	Carrying Value at
(Dollars in thousands)	March 31, 2012					June 30, 2011
	Balance		Percentage of portfolio			Balance		Percentage of portfolio
	Balance		Percentage of portfolio			Balance		Percentage of portfolio
Securities available-for-sale:
U.S. government sponsored enterprises	$	20,093		9.4	%	$	25,703		12.0	%
State and political subdivisions		5,592		2.6			7,062		3.3
Mortgage-backed securities-residential		24,433		11.4			28,914		13.5
Mortgage-backed securities-multifamily		17,580		8.2			21,096		9.8
Asset-backed securities		20		0.0			23		0.0
Corporate debt securities		6,361		3.0			7,206		3.3
Total debt securities		74,079		34.6			90,004		41.9
Equity securities and other		126		0.1			113		0.1
Total securities available-for-sale		74,205		34.7			90,117		42.0
Securities held-to-maturity:
U.S. treasury securities		11,037		5.2			11,062		5.1
U.S. government sponsored enterprises		998		0.5			997		0.5
State and political subdivisions		53,197		24.9			34,933		16.3
Mortgage-backed securities-residential		52,184		24.4			57,347		26.8
Mortgage-backed securities-multifamily		21,643		10.1			19,434		9.1
Other securities		385		0.2			404		0.2
Total securities held-to-maturity		139,444		65.3			124,177		58.0
Total securities	$	213,649		100.0	%	$	214,294		100.0	%

LOANS

Net loans receivable increased to $312.1 million at March 31, 2012 from $301.0 million at June 30, 2011, an increase of $11.1 million, or 3.7%. The loan growth experienced during the nine months primarily consisted of $7.0 million in nonresidential real estate loans, $5.2 million in residential mortgage loans, $1.7 million in non-mortgage loans, and $457,000 in construction loans and was partially offset by a $467,000 decrease in multifamily mortgage loans, a $1.9 million decrease in home equity loans and a $898,000 increase in the allowance for loan losses. The continued low interest rate environment and, we believe, strong customer satisfaction from personal service continued to enhance loan growth. If long term rates begin to rise, the Company anticipates some slow down in new loan demand as well as refinancing activities. The Bank of Greene County continues to use a conservative underwriting policy in regard to all loan originations, and does not engage in sub-prime lending or other exotic loan products. The Company is subject, however, to the effects of any downturn, and especially, a significant decline in home values in the Company’s markets could have a negative effect on the consolidated results of operations. A significant decline in home values would likely lead to a decrease in residential real estate loans and new home equity loan originations along with increased delinquencies and defaults in both the consumer home equity loan and the residential real estate loan portfolios resulting in increased losses in these portfolios. As of March 31, 2012, declines in home values have been modest in the Company’s market area. However, updated appraisals are obtained on loans when there is a reason to believe that there has been a change in the borrower’s ability to repay the loan principal and interest, generally, when a loan is in a delinquent status. Additionally, if an existing loan is to be modified or refinanced, generally, an appraisal is ordered to ensure continued collateral adequacy. During the nine months ended March 31, 2012, properties within several communities within the Company’s market area were either severely damaged or destroyed as a result of Hurricane Irene. Many of the properties were covered by flood insurance. The Company is monitoring the affected mortgage loans within its portfolio, evaluating collateral values, disbursing insurance proceeds to the borrower as repairs progress, and monitoring ongoing repayment of the loans. The Company has evaluated its potential losses that may result from this natural disaster and has made additional provisions to the allowance for loan losses. During the nine months ended March 31, 2012, the Company recognized a charge-off in the amount of $130,000 related to flood damage resulting from Hurricane Irene.


	March 31, 2012						June 30, 2011
(Dollars in thousands)	Balance			Percentage of Portfolio			Balance			Percentage of Portfolio

Real estate mortgages:
Residential	$	186,821			58.8	%	$	181,612			59.4	%
Nonresidential		70,909			22.3			63,860			20.9
Construction and land		6,202			2.0			5,745			1.9
Multi-family		5,581			1.8			6,048			2.0
Total real estate mortgages		269,513			84.9			257,265			84.2
Home equity loans		23,677			7.4			25,559			8.4
Consumer installment		4,107			1.3			4,008			1.3
Commercial loans		20,378			6.4			18,788			6.1
Total gross loans		317,675			100.0	%		305,620			100.0	%
Deferred fees and costs		414						495
Allowance for loan losses		(5,967	)					(5,069	)
Total net loans	$	312,122					$	301,046

ALLOWANCE FOR LOAN LOSSES

The allowance for loan losses is established through a provision for loan losses based on management’s evaluation of the risk inherent in the loan portfolio, the composition of the loan portfolio, specific impaired loans and current economic conditions. Such evaluation, which includes a review of all loans on which full collectability may not be reasonably assured, considers among other matters, the estimated net realizable value or the fair value of the underlying collateral, economic conditions, payment status of the loan, historical loan loss experience and other factors that warrant recognition in providing for an allowance for loan loss. In addition, various regulatory agencies, as an integral part of their examination process, periodically review The Bank of Greene County’s allowance for loan losses. Such agencies may require The Bank of Greene County to recognize additions to the allowance based on their judgment about information available to them at the time of their examination. The Bank of Greene County considers residential mortgages, home equity loans and installment loans to customers as small, homogeneous loans, which are evaluated for impairment collectively based on historical loss experience. Commercial mortgage and business loans are viewed individually and considered impaired if it is probable that The Bank of Greene County will not be able to collect scheduled payments of principal and interest when due, according to the contractual terms of the loan agreements. The measurement of impaired loans is generally based on the fair value of the underlying collateral. The allowance for loan losses is increased by a provision for loan losses (which results in a charge to expense) and recoveries of loans previously charged off and is reduced by charge-offs.

Analysis of allowance for loan losses activity

(Dollars in thousands)	Nine months ended March 31,
	2012	2011

Balance at the beginning of the period	$5,069	$4,024
Charge-offs:
Residential real estate mortgages	172	140
Nonresidential mortgage	212	78
Consumer installment	183	185
Commercial loans	35	9
Total loans charged off	602	412

Recoveries:
Residential real estate mortgages	4	---
Consumer installment	57	77
Commercial loans	2	8
Total recoveries	63	85

Net charge-offs	539	327

Provisions charged to operations	1,437	1,179
Balance at the end of the period	$5,967	$4,876

Ratio of annualized net charge-offs to average loans outstanding	0.23%	0.15%
Ratio of annualized net charge-offs to nonperforming assets	9.92%	6.31%
Allowance for loan losses to nonperforming loans	87.33%	76.80%
Allowance for loan losses to total loans receivable	1.88%	1.62%

Nonaccrual Loans and Nonperforming Assets

Management places loans on nonaccrual status once the loans have become 90 days or more delinquent or sooner if there is a significant reason for management to believe the collectability is questionable and, therefore, interest on the loan will no longer be recognized on an accrual basis. A loan is not placed back on accrual status until the borrower has demonstrated the ability and willingness to make timely payments on the loan. The Company identifies impaired loans and measures the impairment in accordance with FASB ASC subtopic “Receivables – Loan Impairment.” Management may consider a loan impaired once it is classified as nonaccrual and when it is probable that the borrower will be unable to repay the loan according to the original contractual terms of the loan agreement or the loan is restructured in a troubled debt restructuring. Management does not evaluate all loans individually for impairment. The Bank of Greene County considers residential mortgages, home equity loans and installment loans as small, homogeneous loans, which are evaluated for impairment collectively based on historical loan experience and other factors. In contrast, large commercial mortgage, construction, multi-family and business loans are viewed individually and considered impaired if it is probable that The Bank of Greene County will not be able to collect scheduled payments of principal and interest when due, according to the contractual terms of the loan agreement. The measurement of impaired loans is generally based on the fair value of the underlying collateral. The majority of The Bank of Greene County loans, including most nonaccrual loans, are small homogenous loan types adequately supported by collateral. As a result, the level of impaired loans may only be a portion of the nonaccrual loans. Loans that are delinquent or slow paying may not be impaired, especially small homogenous loan types, due to collateral adequacy. Management considers the payment status of loans in the process of evaluating the adequacy of the allowance for loan losses among other factors. Loans that are either delinquent a minimum of 60 days or are on nonaccrual status, and are not individually considered impaired, are either designated as Special Mention or Substandard, and the allocation of the allowance for loan loss is based upon the risk associated with such designation. For further discussion and detail regarding the Allowance for Loan Losses and impaired loans please refer to Note (5) Credit Quality of Loans and Allowance for Loan Losses. A loan does not have to be 90 days delinquent in order to be classified as nonperforming. The Bank of Greene County had one accruing loan delinquent more than 90 days as of March 31, 2012 totaling $41,000 and had no accruing loans delinquent more than 90 days as of June 30, 2011. Loans delinquent more than 90 days and accruing consist of loans that are well collateralized and the borrower has demonstrated the ability and willingness to pay. The borrower has made arrangements with the Bank to bring the loan current within a specified time period and has made a series of payments as agreed. Foreclosed real estate is considered to be a nonperforming asset.

Analysis of Nonaccrual Loans and Nonperforming Assets

	At
(Dollars in thousands)	March 31, 2011			June 30, 2011
Nonaccrual loans:
Real estate mortgages:
Residential	$	4,015		$	3,074
Nonresidential		2,062			2,171
Construction and land		---			238
Multi-family		434			577
Home equity loans		60			49
Consumer installment		19			41
Commercial loans		202			144
Total nonaccrual loans		6,792			6,294
Accruing loans delinquent 90 days or more
Residential		41			---
Total nonperforming loans		6,833			6,294
Foreclosed real estate:
Residential		60			363
Nonresidential		200			80
Land		150			---
Foreclosed real estate		410			443
Total nonperforming assets	$	7,243		$	6,737

Total nonperforming assets as a percentage of total assets		1.25	%		1.23	%
Total nonperforming loans to net loans		2.19	%		2.09	%

The table below details additional information related to nonaccrual loans for the nine months ended March 31:

(In thousands)	2012		2011
Interest income that would have been recorded if loans had been performing in accordance with original terms	$	442	$	458
Interest income that was recorded on nonaccrual loans during the nine months ended		211		176

The Company identifies impaired loans and measures the impairment in accordance with FASB ASC subtopic “Receivables – Loan Impairment”. A loan is considered impaired when it is probable that the borrower will be unable to repay the loan according to the original contractual terms of the loan agreement or the loan is restructured in a troubled debt restructuring.

The table below details additional information on impaired loans as of and for the nine months ended March 31:

(In thousands)	2012		2011
Balance of impaired loans, with a valuation allowance	$	2,911	$	373
Allowance relating to impaired loans included in allowance for loan losses		778		93
Balance of impaired loans, without a valuation allowance		1,803		212
Average balance of impaired loans for the nine months ended		2,808		768
Interest income recorded on impaired loans during the nine months ended		117		10

Nonperforming assets amounted to $7.2 million at March 31, 2012 and $6.7 million as of June 30, 2011, an increase of approximately $506,000 or 7.5%, and total impaired loans amounted to $4.7 million at March 31, 2012 compared to $2.9 million at June 30, 2011, an increase of $1.8 million, or 62.1%. The growth in nonperforming assets has been the result of adverse changes within the economy and increases in local unemployment. Loans on nonaccrual status totaled $6.8 million at March 31, 2012 of which $2.9 million were in the process of foreclosure. Of the remaining $3.9 million in nonaccrual loans, $2.8 million were less than 90 days past due, or were current at March 31, 2012, but have a recent history of delinquency greater than 90 days past due. These loans will be returned to accrual status once they have demonstrated a history of timely payments. Of total delinquent loans, $922,000 were making payments pursuant to forbearance agreements. Under the forbearance agreements, the customers have made arrangements with the Bank to bring the loans current over a specified period of time (resulting in an insignificant delay in repayment). During this period, the Bank has agreed not to continue foreclosure proceedings. While the Bank makes every reasonable effort to work with the borrowers to collect amounts due, the number of loans in process of foreclosure has grown substantially over the past several years. The growth in nonperforming assets is also due in part to the extended length of time required to meet all of the legal requirements mandated by New York State law prior to a foreclosure sale, which may be in excess of two years. The majority of The Bank of Greene County loans, including most nonaccrual loans as of March 31, 2012, are small homogenous loan types adequately supported by collateral. As a result, the level of impaired loans may only be a portion of nonaccrual loans. Loans that are delinquent or slow paying may not be impaired, especially small homogenous loan types, due to collateral adequacy. These loans are included in total nonperforming assets.

DEPOSITS

Total deposits increased to $514.6 million at March 31, 2012 from $469.9 million at June 30, 2011, an increase of $44.7 million, or 9.5%. This increase was primarily the result of an increase of $32.6 million in balances at Greene County Commercial Bank, our commercial bank subsidiary, which attracts deposits from local municipalities, due primarily to the annual collection of taxes. Interest bearing checking accounts (NOW accounts) increased $35.3 million or 24.6% to $178.7 million at March 31, 2012 as compared to $143.4 million at June 30, 2011. Savings deposits increased $14.4 million, and money market deposits increased $10.9 million between June 30, 2011 and March 31, 2012. Noninterest bearing deposits increased $494,000 to $49.8 million at March 31, 2012. Partially offsetting these increases was a $16.4 million decrease in certificates of deposit balances between June 30, 2011 and March 31, 2012.

(Dollars in thousands)
	At March 31, 2012		Percentage of Portfolio			At June 30, 2011		Percentage of Portfolio

Noninterest bearing deposits	$	49,807		9.7	%	$	49,313		10.5	%
Certificates of deposit		75,095		14.6			91,549		19.5
Savings deposits		126,254		24.5			111,851		23.8
Money market deposits		84,695		16.5			73,795		15.7
NOW deposits		178,746		34.7			143,389		30.5
Total deposits	$	514,597		100.0	%	$	469,897		100.0	%

BORROWINGS

At March 31, 2012, The Bank of Greene County had pledged approximately $164.0 million of its residential mortgage portfolio as collateral for borrowing at the Federal Home Loan Bank (“FHLB”). The maximum amount of funding available from the FHLB through either overnight advances or term borrowings was $129.3 million at March 31, 2012, of which $9.0 million in term borrowings were outstanding at March 31, 2012. There were no overnight borrowings outstanding at March 31, 2012. Interest rates on overnight borrowings are determined at the time of borrowing. Term borrowings consisted of $4.0 million of fixed rate, fixed term advances with a weighted average rate of 3.45% and a weighted average maturity of 25 months. The remaining $5.0 million of borrowing, which carried a 3.64% interest rate and a maturity of 18 months at March 31, 2012, is unilaterally convertible by the FHLB under certain market interest rate scenarios, including three-month LIBOR at or above 7.50%, into replacement advances for the same or lesser principal amount based on the then current market rates. If the Bank chooses not to accept the replacement funding, the Bank must repay this convertible advance, including any accrued interest, on the interest payment date.

The Bank also pledges securities as collateral at the Federal Reserve Bank discount window for overnight borrowings. At March 31, 2012, approximately $6.3 million of collateral was available to be pledged against potential borrowings at the Federal Reserve Bank discount window. There were no balances outstanding with the Federal Reserve Bank at March 31, 2012.

The Bank of Greene County has an unsecured line of credit with Atlantic Central Bankers Bank for $6.0 million. The line of credit provides for overnight borrowing and the interest rate is determined at the time of the borrowing. At March 31, 2012 and 2011 there were no balances outstanding with Atlantic Central Bankers Bank, and there was no activity during the nine months ended March 31, 2012 and 2011.

Scheduled maturities of term borrowings at March 31, 2012 were as follows:

(In thousands)
Fiscal year end
2013		1,000
2014		6,000
2015		2,000
	$	9,000

SHAREHOLDERS’ EQUITY

Shareholders’ equity increased to $51.8 million at March 31, 2012 from $48.1 million at June 30, 2011, as net income of $4.5 million was partially offset by dividends declared and paid of $970,000. Additionally, shareholders’ equity decreased $106,000 as a result of a decrease in accumulated other comprehensive income, primarily from a decrease in the unrealized gains on available for sale securities, net of tax. Other changes in equity, totaling a $276,000 increase, were the result of activities associated with the Company’s 2008 Stock Option Plan.

Comparison of Operating Results for the Nine and Three Months Ended March 31, 2012 and 2011

Average Balance Sheet

The following tables set forth certain information relating to Greene County Bancorp, Inc. for the nine and three months ended March 31, 2012 and 2011. For the periods indicated, the total dollar amount of interest income from average interest earning assets and the resultant yields, as well as the interest expense on average interest bearing liabilities, are expressed both in dollars and rates. No tax equivalent adjustments were made. Average balances were based on daily averages. Average loan balances include non-performing loans. The loan yields include net amortization of certain deferred fees and costs that are considered adjustments to yields. Rates and yields for all periods presented are annualized.

Nine Months Ended March 31, 2012 and 2011

(Dollars in thousands)	2012	2012	2012	2011	2011	2011
	Average	Interest	Average	Average	Interest	Average
	Outstanding	Earned/	Yield/	Outstanding	Earned/	Yield/
	Balance	Paid	Rate	Balance	Paid	Rate
Interest earning assets:
Loans receivable, net1	$313,159	$13,384	5.70%	$301,333	$13,434	5.94%
Securities2	207,490	4,912	3.16	186,406	4,510	3.23
Interest bearing bank balances
and federal funds	10,733	17	0.21	15,688	32	0.27
FHLB stock	1,406	49	4.65	1,456	65	5.95
Total interest earning assets	532,788	18,362	4.60%	504,883	18,041	4.76%
Cash and due from banks	7,552			7,190
Allowance for loan losses	(5,459)			(4,382)
Other non-interest earning assets	19,202			18,845
Total assets	$554,083			$526,536

Interest bearing liabilities:
Savings and money market deposits	$194,644	$889	0.61%	$164,537	$837	0.68%
NOW deposits	159,654	716	0.60	153,256	753	0.66
Certificates of deposit	82,606	858	1.38	96,780	1,417	1.95
Borrowings	14,964	315	2.81	16,981	422	3.31
Total interest bearing liabilities	451,868	2,778	0.82%	431,554	3,429	1.06%
Non-interest bearing deposits	49,257			46,663
Other non-interest bearing liabilities	3,072			2,539
Shareholders’ equity	49,886			45,780
Total liabilities and equity	$554,083			$526,536

Net interest income		$15,584			$14,612

Net interest rate spread			3.78%			3.70%

Net Earning Assets	$80,920			$73,329

Net interest margin			3.90%			3.86%

Average interest earning assets to
average interest bearing liabilities			117.91%			116.99%

___________________________________________________________________

1Calculated net of deferred loan fees and costs, loan discounts, and loans in process.

2Includes tax-free securities, mortgage-backed securities, asset-backed securities and long term certificates of deposit.

Three Months Ended March 31, 2012 and 2011

(Dollars in thousands)	2012	2012	2012	2011	2011	2011
	Average	Interest	Average	Average	Interest	Average
	Outstanding	Earned/	Yield/	Outstanding	Earned/	Yield/
	Balance	Paid	Rate	Balance	Paid	Rate
Interest earning assets:
Loans receivable, net1	$316,903	$4,441	5.61%	$300,242	$4,388	5.85%
Securities2	209,730	1,539	2.94	205,145	1,578	3.08
Interest bearing bank balances
and federal funds	7,858	3	0.15	18,412	12	0.26
FHLB stock	1,183	16	5.41	1,297	21	6.48
Total interest earning assets	535,674	5,999	4.48%	525,096	5,999	4.57%
Cash and due from banks	7,937			7,270
Allowance for loan losses	(5,728)			(4,653)
Other non-interest earning assets	19,252			19,576
Total assets	$557,135			$547,289

Interest bearing liabilities:
Savings and money market deposits	$199,831	$299	0.60%	$171,717	$269	0.63%
NOW deposits	166,246	244	0.59	166,856	249	0.60
Certificates of deposit	77,456	206	1.06	95,581	444	1.86
Borrowings	10,006	88	3.52	13,444	117	3.48
Total interest bearing liabilities	453,539	837	0.74%	447,598	1,079	0.96%
Non-interest bearing deposits	49,709			50,954
Other non-interest bearing liabilities	2,717			2,460
Shareholders’ equity	51,170			46,277
Total liabilities and equity	$557,135			$547,289

Net interest income		$5,162			$4,920

Net interest rate spread			3.74%			3.61%

Net Earning Assets	$82,135			$77,498

Net interest margin			3.85%			3.75%

Average interest earning assets to
average interest bearing liabilities			118.11%			117.31%

_______________________________________________

1Calculated net of deferred loan fees and costs, loan discounts, and loans in process.

2Includes tax-free securities, mortgage-backed securities, asset-backed securities and long term certificates of deposit.

Rate / Volume Analysis

The following table presents the extent to which changes in interest rates and changes in the volume of interest-earning assets and interest-bearing liabilities have affected Greene County Bancorp, Inc.’s interest income and interest expense during the periods indicated. Information is provided in each category with respect to:

(i)	Change attributable to changes in volume (changes in volume multiplied by prior rate);

(ii)	Change attributable to changes in rate (changes in rate multiplied by prior volume); and

(iii)

The net change.

The changes attributable to the combined impact of volume and rate have been allocated proportionately to the changes due to volume and the changes due to rate.

	Nine Months Ended March 31,									Three Months Ended March 31,
(Dollars in thousands)	2012 versus 2011									2012 versus 2011
	Increase/(Decrease)						Total			Increase/(Decrease)						Total
	Due to						Increase/			Due to						Increase/
Interest-earning assets:	Volume			Rate			(Decrease)			Volume			Rate			(Decrease)
Loans receivable, net1	$	510		$	(560	)	$	(50	)	$	238		$	(185	)	$	53
Securities2		502			(100	)		402			34			(73	)		(39	)
Interest-
bearing bank balances and federal funds		(9	)		(6	)		(15	)		(5	)		(4	)		(9	)
FHLB stock		(2	)		(14	)		(16	)		(2	)		(3	)		(5	)
Total interest-earning assets		1,001			(680	)		321			265			(265	)		---

Interest-bearing liabilities:
Savings and money market deposits		144			(92	)		52			43			(13	)		30
NOW deposits		32			(69	)		(37	)		(1	)		(4	)		(5	)
Certificates of deposit		(187	)		(372	)		(559	)		(73	)		(165	)		(238	)
Borrowings		(47	)		(60	)		(107	)		(30	)		1			(29	)
Total interest-bearing liabilities		(58	)		(593	)		(651	)		(61	)		(181	)		(242	)
Net interest income	$	1,059		$	(87	)	$	972		$	326		$	(84	)	$	242

________________________________________________

1 Calculated net of deferred loan fees, loan discounts, and loans in process.

2 Includes tax-free securities, mortgage-backed securities, asset-backed securities and long term certificates of deposit.

GENERAL

Return on average assets and return on average equity are common methods of measuring operating results. Annualized return on average assets increased to 1.08% for the nine months and 1.06% for the quarter ended March 31, 2012 as compared to 0.99% for the nine months and 0.91% for the quarter ended March 31, 2011. Annualized return on average equity increased to 11.99% for the nine months and 11.59% for the quarter ended March 31, 2012 as compared to 11.40% for the nine months and 10.71% for the quarter ended March 31, 2011. The increase in return on average assets and return on average equity was primarily the result of higher net interest income. Net income amounted to $4.5 million and $3.9 million for the nine months ended March 31, 2012 and 2011, respectively, an increase of $572,000 or 14.6% and amounted to $1.5 million and $1.2 million for the quarters ended March 31, 2012 and 2011, respectively, an increase of $244,000 or 19.7%. Average assets increased $27.6 million, or 5.2% to $554.1 million for the nine months ended March 31, 2012 as compared to $526.5 million for the nine months ended March 31, 2011. Average equity increased $4.1 million, or 8.9%, to $49.9 million for the nine months ended March 31, 2012 as compared to $45.8 million for the nine months ended March 31, 2011. Average assets increased $9.8 million, or 1.8% to $557.1 million for the quarter ended March 31, 2012 as compared to $547.3 million for the quarter ended March 31, 2011. Average equity increased $4.9 million, or 10.6% to $51.2 million for the quarter ended March 31, 2012 as compared to $46.3 million for the quarter ended March 31, 2011.

INTEREST INCOME

Interest income amounted to $18.4 million for the nine months ended March 31, 2012 as compared to $18.0 million for the nine months ended March 31, 2011, an increase of $321,000 or 1.8%. Interest income amounted to $6.0 million for the quarters ended March 31, 2012 and 2011. The combined increase in loan and securities volume had the greatest impact on interest income when comparing the nine months and quarters ended March 31, 2012 and 2011. Average loan balances increased $11.8 million for the nine months ended March 31, 2012 as compared to March 31, 2011 while the yield decreased by 24 basis points when comparing the same periods. Average loan balances increased $16.7 million for the quarter ended March 31, 2012 as compared to the quarter ended March 31, 2011 and the yield decreased by 24 basis points when comparing the same periods. Average securities balances increased $21.1 million for the nine months ended March 31, 2012 as compared to March 31, 2011 while the yield decreased by 7 basis points when comparing the same periods. Average securities balances increased $4.6 million for the quarter ended March 31, 2012 as compared to the quarter ended March 31, 2011 and the yield decreased 14 basis points when comparing the same periods. Average balances on short term investments such as interest bearing bank balances and federal funds sold decreased $5.0 million and $10.6 million, respectively when comparing the nine months and quarters ended March 31, 2012 and 2011. The yield on short term investments decreased 6 basis points and 11 basis points when comparing the nine months and quarters ended March 31, 2012 and 2011, respectively.

INTEREST EXPENSE

Interest expense amounted to $2.8 million for the nine months ended March 31, 2012, as compared to $3.4 million for the nine months ended March 31, 2011, a decrease of $651,000. Interest expense amounted to $837,000 for the quarter ended March 31, 2012, as compared to $1.1 million for the quarter ended March 31, 2011, a decrease of $242,000. Decreases in rates on interest-bearing liabilities had the greatest impact on overall interest expense for the quarter and nine months ended March 31, 2012 as compared to March 31, 2011.

As illustrated in the Rate/Volume Analysis Table, interest expense was reduced $593,000 and $181,000 when comparing the nine months and quarters ended March 31, 2012 and 2011, respectively, due to decreases of 24 basis points and 22 basis points, respectively, in the average rate on interest-bearing liabilities in those same periods. Also, interest expense was further reduced as a result of a shift in deposit balances from higher-costing certificates of deposit and borrowed funds, to lower-costing savings and money market deposits.

The average rate paid on NOW deposits decreased 6 basis points and 1 basis point, respectively, when comparing the nine months and quarters ended March 31, 2012 and 2011. The average balance of such accounts grew by $6.4 million for the nine months ended March 31, 2012 and decreased by $610,000 for the quarter ended March 31, 2012. The average balance of certificates of deposit decreased by $14.2 million and the average rate paid decreased by 57 basis points when comparing the nine months ended March 31, 2012 and 2011. The average balance of certificates of deposit decreased by $18.1 million and the average rate paid decreased by 80 basis points when comparing the quarters ended March 31, 2012 and 2011. The average balance of savings and money market deposits increased by $30.1 million when comparing the nine months ended March 31, 2012 and 2011 and increased by $28.1 million when comparing the quarters ended March 31, 2012 and 2011. The average rate paid on savings and money markets decreased 7 basis points and 3 basis points when comparing the nine months and quarters ended March 31, 2012 and 2011, respectively. The average balance of borrowings decreased $2.0 million and $3.4 million when comparing the nine months and quarters ended March 31, 2012 and 2011. The rate paid on these borrowings decreased 50 basis points and increased 4 basis points when comparing the same periods.

NET INTEREST INCOME

Net interest income increased $1.0 million to $15.6 million for the nine months ended March 31, 2012 compared to $14.6 million for the nine months ended March 31, 2011 and increased $242,000 to $5.2 million for the quarter ended March 31, 2012 compared to $4.9 million for the quarter ended March 31, 2011. Net interest rate spread increased 8 basis points to 3.78% for the nine months ended March 31, 2012 from 3.70% for the nine months ended March 31, 2011, and increased 13 basis points to 3.74% for the nine months ended March 31, 2012 from 3.61% for the quarter ended March 31, 2011. Net interest margin increased 4 basis points to 3.90% for the nine months ended March 31, 2012 from 3.86% for the nine months ended March 31, 2011, and increased 10 basis points to 3.85% for the quarter ended March 31, 2012 as compared to 3.75% for the quarter ended March 31, 2011. The increase in average balances of loans and securities, along with a decrease in rates paid on deposit accounts, primarily led to an increase in net interest income when comparing the nine months and quarters ended March 31, 2012 and 2011.

Due to the large portion of fixed-rate residential mortgages in the Company’s asset portfolio, interest rate risk is a concern and the Company will continue to monitor our interest rate risk position and attempt to adjust the asset and liability mix as much as possible to take advantage of the benefits and reduce the risks or potential negative effects of a rising rate environment. Management attempts to mitigate the interest rate risk through balance sheet composition. Several strategies are used to help manage interest rate risk such as maintaining a high level of liquid assets such as short-term federal funds sold and various investment securities and maintaining a high concentration of less interest-rate sensitive and lower-costing core deposits.

PROVISION FOR LOAN LOSSES

Management continues to closely monitor asset quality and adjust the level of the allowance for loan losses when necessary. The amount recognized for the provision for loan losses is determined by management based on its ongoing analysis of the adequacy of the allowance for loan losses. During the nine months ended March 31, 2012 and 2011, the Company increased the level of allowance for loan losses due to an increase in the amount of nonperforming assets and loan charge-offs resulting from a decline in the overall economy, and an increase in local unemployment. Also, during the nine months ended March 31, 2012, the Company increased its provision for loan losses as a result of flood damage caused by Hurricane Irene within several of the communities within its market area. The Company recognized a charge-off of $130,000 during the nine months ended March 31, 2012 resulting from the flood damage and continues to assess the impact on its loan portfolio from this natural disaster and monitor the credit quality of the affected loans. As a result, the provision for loan losses amounted to $1.4 million and $1.2 million for the nine months ended March 31, 2012 and 2011, respectively, an increase of $258,000 or 21.9%. The provision for loan losses amounted to $541,000 and $343,000 for the quarters ended March 31, 2012 and 2011, respectively. Continued increases in non-performing assets and loan charge-offs have resulted in an increase in the level of allowance for loan losses to total loans receivable to 1.88% as of March 31, 2012 as compared to 1.66% as of June 30, 2011. Nonperforming loans amounted to $6.9 million and $6.3 million at March 31, 2012 and June 30, 2011, respectively, an increase of $539,000 or 8.6%. Net charge-offs amounted to $539,000 and $327,000 for the nine months ended March 31, 2012 and 2011, respectively, an increase of $212,000. At March 31, 2012, nonperforming assets were 1.25% of total assets and nonperforming loans were 2.19% of net loans. The Company has not been an originator of “no documentation” mortgage loans and the loan portfolio does not include any mortgage loans that the Company classifies as sub-prime.

NONINTEREST INCOME

Noninterest income increased $36,000 and $75,000 when comparing the nine months and quarters ended March 31, 2012 and 2011, respectively. Noninterest income amounted to $3.6 million and $1.2 million for the nine months and quarter ended March 31, 2012, respectively. The Company recorded a net gain on sale of investments during the nine months ended March 31, 2012 totaling $11,000, and a net gain on sale of investments during the nine months and three months ended March 31, 2011 totaling $233,000 and $21,000 respectively. Excluding these items, noninterest income increased $258,000 when comparing the nine months, and $96,000 when comparing the quarters, ended March 31, 2012 and 2011, respectively. These increases were primarily the result of higher service charges on deposit accounts and higher debit card fees due to growth in the number of deposit accounts.

NONINTEREST EXPENSE

Noninterest expense increased $86,000 and decreased $95,000 when comparing the nine months and quarters ended March 31, 2012 and 2011, respectively. The year-to-date increase was primarily due to an increase in legal and professional fees, service and data processing fees, equipment and furniture expense, computer software, supplies & support, and other expenses. The increase in legal and professional fees of $103,000 when comparing the nine months ended March 31, 2012 and 2011, respectively, was related to loans in process of foreclosure and increased fees for consulting services related to the implementation of strategic objectives. Included in the increase in service and data processing fees of $47,000 when comparing the nine months ended March 31, 2012 and 2011, respectively, were increased costs associated with the increase in the number of accounts with a debit card. The increase in other expenses was the result of the recognition of a loss on foreclosed assets of $153,000 for the nine months ended March 31, 2012. These increases were partially offset by decreases in FDIC insurance premiums of $237,000 when comparing the nine months ended March 31, 2012 and 2011, respectively. The decrease in noninterest expense when comparing the three months ended March 31, 2012 and 2011 was primarily the result of a $108,000 decrease in FDIC insurance premiums. The decrease in FDIC insurance premiums was the result of regulatory changes in the method of calculating the premiums.

PROVISION FOR INCOME TAXES

The provision for income taxes directly reflects the expected tax associated with the pre-tax income generated for the given reporting period. The effective tax rate was 28.6% for the quarter ended March 31, 2012, compared to 33.5% for the quarter ended March 31, 2011. The decrease in the effective tax rate is directly related to the tax benefits derived from the newly formed subsidiary, Greene Property Holdings, Inc., a real estate investment trust which began operations as of January 4, 2012.

LIQUIDITY AND CAPITAL RESOURCES

Market risk is the risk of loss in a financial instrument arising from adverse changes in market rates or prices such as interest rates, foreign currency exchange rates, commodity prices, and equity prices. Greene County Bancorp, Inc.’s most significant form of market risk is interest rate risk since the majority of Greene County Bancorp, Inc.’s assets and liabilities are sensitive to changes in interest rates. Greene County Bancorp, Inc.’s primary sources of funds are deposits and proceeds from principal and interest payments on loans, mortgage-backed securities and debt securities, with lines of credit available through the Federal Home Loan Bank and Atlantic Central Bankers Bank as needed. While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit outflows, mortgage prepayments, and lending activities are greatly influenced by general interest rates, economic conditions and competition.

Mortgage loan commitments, including construction and land loan commitments, totaled $12.4 million at March 31, 2012. The unused portion of overdraft lines of credit amounted to $732,000, the unused portion of home equity lines of credit amounted to $8.4 million, and the unused portion of commercial lines of credit and commercial loan commitments amounted to $10.3 million at March 31, 2012. Greene County Bancorp, Inc. anticipates that it will have sufficient funds available to meet current loan commitments based on the level of cash and cash equivalents as well as the available for sale investment portfolio and borrowing capacity.

The Bank of Greene County and Greene County Commercial Bank met all applicable regulatory capital requirements at March 31, 2012 and June 30, 2011. Consolidated shareholders’ equity represented 8.9% of total assets at March 31, 2012 and 8.8% of total assets of June 30, 2011.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable to smaller reporting companies.

Item 4. Controls and Procedures

Under the supervision and with the participation of the Company's management, including its Chief Executive Officer and Chief Financial Officer, the Company evaluated the effectiveness of the design and operation of its disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this report, the Company's disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and in timely altering them to material information relating to the Company (or its consolidated subsidiaries) required to be filed in its periodic SEC filings.

There has been no change in the Company's internal control over financial reporting in connection with the quarterly evaluation that occurred during the Company's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

Part II. Other Information

Item 1. Legal Proceedings

Greene County Bancorp, Inc. and its subsidiaries are not engaged in any

material legal proceedings at the present time.

Item 1A. Risk Factors

Not applicable to smaller reporting companies.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

a)	Not applicable

b)	Not applicable

No shares were repurchased during the quarter ended March 31, 2012.

Item 3. Defaults Upon Senior Securities

Not applicable

Item 4. Mine Safety Disclosures

Not applicable

Item 5. Other Information

a)	Not applicable

b)	There were no material changes to the procedures by which security holders may recommend nominees to the Company’s Board of Directors during the period covered by this Form 10-Q.

Item 6. Exhibits

Exhibits

31.1 Certification of Chief Executive Officer, adopted pursuant to Rule 13a-14(a)/15d-14(a)

31.2 Certification of Chief Financial Officer, adopted pursuant to Rule 13a-14(a)/15d-14(a)

32.1 Statement of Chief Executive Officer, furnished pursuant to U.S.C. Section 1350

32.2 Statement of Chief Financial Officer, furnished pursuant to U.S.C. Section 1350

101

The following materials from Greene County Bancorp, Inc. Form 10-Q for the three and nine month ended March 31, 2012, formatted in Extensible Busiess Reporting Language (XBRL): (i) the Consolidated Statements of Income, (ii) the Consolidated Statements of Financial Condition, (iii) Consolidated Statements of Cash Flows and (iv) related notes, tagged as blocks of text.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed by the undersigned thereunto duly authorized.

Greene County Bancorp, Inc.

Date: May 14, 2012

By: /s/ Donald E. Gibson

Donald E. Gibson

President and Chief Executive Officer

Date: May 14, 2012

By: /s/ Michelle M. Plummer

Michelle M. Plummer, CPA

Executive Vice President, Chief Financial Officer and Chief Operating Officer

EXHIBIT 31.1

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Donald E. Gibson, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Greene County Bancorp, Inc.;

Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

Based on my knowledge, the consolidated financial statements, and other financial information included in this quarterly report, fairly present in all material respects the consolidated financial condition, consolidated results of operations and consolidated cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 14, 2012 /s/ Donald E. Gibson

Donald E. Gibson

President and Chief Executive Officer

EXHIBIT 31.2

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Michelle M. Plummer, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Greene County Bancorp, Inc.;

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 14, 2012 /s/ Michelle M. Plummer

Michelle M. Plummer, CPA

Executive Vice President, Chief Financial Officer and Chief Operating Officer

EXHIBIT 32.1

Statement of Chief Executive Officer

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Donald E. Gibson, President and Chief Executive Officer, of Greene County Bancorp, Inc. (the “Company”) certifies in his capacity as an officer of the Company that he has reviewed the Quarterly Report of the Company on Form 10-Q for the quarter ended March 31, 2012 and that to the best of his knowledge:

1.	the report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	the information contained in the report fairly presents, in all material respects, the consolidated financial condition and consolidated results of operations of the Company as of the dates and for the periods covered by the report.

This statement is authorized to be attached as an exhibit to the report so that this statement will accompany the report at such time as the report is filed with the Securities and Exchange Commission pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 USC 1350. It is not intended that this statement be deemed to be filed for purposes of the Securities Exchange Act of 1934, as amended.

Date: May 14, 2012 _/s/ Donald E. Gibson

Donald E. Gibson

President and Chief Executive Officer

EXHIBIT 32.2

Statement of Chief Financial Officer

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Michelle M. Plummer, Chief Financial Officer, of Greene County Bancorp, Inc. (the “Company”) certifies in her capacity as an officer of the Company that he or she has reviewed the Quarterly Report of the Company on Form 10-Q for the quarter ended March 31, 2012 and that to the best of her knowledge:

1.	the report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	the information contained in the report fairly presents, in all material respects, the consolidated financial condition and consolidated results of operations of the Company as of the dates and for the periods covered by the report.

Date: May 14, 2012 /s/ Michelle M. Plummer

Michelle M. Plummer, CPA

Executive Vice President, Chief Financial Officer and Chief Operating Officer