HOPFED BANCORP, INC. REPORTS FOURTH QUARTER RESULTS

HopFed Bancorp, Inc. (NASDAQ: HFBC) (the "Company"), the holding company for Heritage Bank (the "Bank"), today reported results for the three and twelve month periods ended December 31, 2011.For the three month period ended December 31, 2011, the Company's net income available to common shareholders was $2.1 million, or $0.28 per share basic and diluted, compared to net income available to common shareholders of $557,000, or $0.07 per share basic and diluted, for the three month period ended December 31, 2010.For the twelve month period ended December 31, 2011, the Company's net income available tocommon shareholders was $1.9 million, or $0.25 per share basic and diluted, compared to net income available to common shareholders of $5.5 million, or $0.96 per share basic and diluted, for the twelve month period ended December 31, 2010.

Commenting on the fourth quarter results, John E. Peck, President and Chief Executive Officer, said, "Management's focus on reducing the level of other real estate owned is paving the way for our improved financial performance. At December 31, 2011, the balance on other real estate owned totaled $2.3 million, compared to $9.8 million at December 31, 2010, and $10.0 million at June 30, 2011. For the three month period ended December 31, 2011, the Company incurred losses and expenses related to other real estate owned of $121,000, as compared to $586,000 for the three month period ended September 30, 2011. For the twelve month period ended December 31, 2011, losses and expenses related to other real estate owned totaled $2.0 million, as compared to a net gain of $57,000 for the year ended December 31, 2010. By reducing the balance in other real estate owned, we anticipate that future losses and operating cost associated with these properties will be minimal."

Mr. Peck continued, "The Company has made progress in reducing the amount of impaired assets. At March 31, 2011, the Company's total impaired assets increased to $80.1 million, due primarily to both international and local weather events and a weak national economy.At December 31, 2011, total impaired assets declined to $54.9 million, due to improvements in the local economy, improved profitability expectations in the agricultural sector and the sale of other real estate owned."

Financial Highlights

• The Company and Bank's capital ratios remain strong. At December 31, 2011, the Company's tangible book value was $13.21 and our tangible common equity ratio is 9.69%. The Bank's tier 1 capital and total risk based capital ratios at December 31, 2011, are 10.18% and 17.63%, respectively. The Company's tier 1 capital and total risk based capital ratios are 11.71% and 20.26%, respectively.
• At December 31, 2011, the Company's and Bank's net classified asset to risk based capital ratios were 43.0% and 49.9%, respectively. Net classified assets include all classified assets less any reserve allocation against the allowance for loan losses. At June 30, 2011, these ratios were 56.7% for the Company and 67.0% for the Bank.
• At December 31, 2011, the Company's allowance for loan loss totaled $11.3 million, or 1.98% of total loans and 183.62% of non-accrual loans. In the three month period ended December 31, 2011, the Company charged off approximately $2.5 million in loans previously reserved for and classified as substandard. The loans in question have been written down to a percentage of their new appraised values. These charge offs did not materially affect the current required funding levels of the allowance for loan loss account as management had previously allocated adequate reserves for these loans.
• For the three month period ended December 31, 2011, the Company's net interest margin was 3.13%, as compared to 3.00% for the three month period ended September 30, 2011, and 3.07% for the three month period ended December 31, 2010.