NEWS
RELEASE





FOR
RELEASE: IMMEDIATELY





WAYNE
SAVINGS BANCSHARES, INC. ANNOUNCES INCREASED EARNINGS FOR THE QUARTER AND NINE
MONTHS ENDED DECEMBER 31, 2008





Wooster, Ohio (January 22, 2009) –
Wayne Savings Bancshares, Inc. (NASDAQ:WAYN), the stock holding company parent
of Wayne Savings Community Bank, reported net income of $584,000 or $0.20 per
diluted share for the third fiscal quarter ended December 31, 2008, compared to
$446,000 or $0.14 per diluted share for the third fiscal quarter ended December
31, 2007.  The increase in net income was primarily due to an increase
in net interest income, resulting from decreased interest expense on deposits,
partially offset by decreased interest income on loans and
investments.





Net interest income increased $322,000
for the quarter ended December 31, 2008, compared to the quarter ended December
31, 2007.  Interest income decreased $418,000 during the 2008 quarter
mainly as a result of lower overall market interest rates during the 2008
quarter compared to the 2007 quarter and the corresponding impact on new
originations and existing adjustable rate loans.  However, interest
expense decreased $740,000 during the quarter as a result of lower deposit
balances and lower market interest rates being reflected in rates paid on
certificates of deposit, money market deposit accounts and advances from the
Federal Home Loan Bank of Cincinnati, partially offset by a higher volume of
borrowings used to replace decreased deposit balances.  Noninterest
income decreased $37,000, due primarily to lower service
charges.  Noninterest expense increased by $25,000, or 1%, mainly due
to increased compensation, deposit insurance and state franchise tax expense,
partially offset by lower other operating expense.





A
provision for loan losses of $185,000 was made for the 2008 quarter compared to
$140,000 provided during the 2007 quarter, based on management’s assessment of
probable incurred losses in the loan portfolio.  The increase was
mainly due to management’s analysis of economic factors in the Company’s market
area and the negative change in those factors from the 2007 quarter to the 2008
quarter.





For the
nine month period ended December 31, 2008, net income totaled $1,716,000 or
$0.59 per diluted share, compared to net income of $1,516,000 or $0.49 per
diluted share for the nine months ended December 31, 2007.





Net interest income increased $617,000
for the nine months ended December 31, 2008 compared to the nine months ended
December 31, 2007.  Interest income decreased $1,046,000 for the 2008
nine month period compared to the same period in 2007, as a result of lower
overall market interest rates during the 2008 period compared to the 2007 period
and the corresponding impact on new originations and existing adjustable rate
loans.  However, interest expense decreased $1,663,000 compared to the
prior year period as a result of decreased balances and rates paid on
certificates of deposit, money market deposit accounts and advances from the
Federal Home Loan Bank of Cincinnati, partially offset by a higher volume of
borrowings used to replace decreased deposit balances.





MORE





Noninterest
income decreased $65,000, due primarily to a $21,000 reduction in gain on sale
of real estate acquired through foreclosure and a $32,000 decrease in service
charges and other income.  Noninterest expense increased by $101,000,
or 1%, primarily due to increased compensation, occupancy, deposit insurance and
franchise tax expense, partially offset by lower other operating
expense.





A
provision for loan losses of $346,000 was made during the nine months ended
December 31, 2008 compared to $195,000 provided during the 2007
period.  The increase was due to management’s analysis of economic
factors in the Company’s market area and the negative change in those factors
from the 2007 period to the 2008 period.





According to Phillip E. Becker,
President and Chief Executive Officer, “The economic environment has continued
to deteriorate, which presents additional challenges to all
institutions.  In this environment, selection of credit risks has
taken on increased importance, along with the management of delinquent credits
to assist borrowers as much as possible while minimizing credit
losses.  The Company continues to exercise discipline in the
management of noninterest expenses and the pricing of deposits in the face of
continued strong competition from competitors seeking to meet their liquidity
needs though the acquisition of high rate retail deposits.  During the
past quarter, the Company elected to not participate in the government’s
Troubled Asset Relief Program (the “TARP”) based on our assessment of the
Company’s capital position and economic conditions in our market
area.  The Company is participating in the liquidity guarantee
programs of the FDIC to provide additional assurances to our depositors
regarding the safety of their deposits.”





At December 31, 2008, Wayne Savings
Bancshares, Inc. reported total assets of $405.4 million, up from total assets
of $401.6 million at March 31, 2008.  The increase in assets was
primarily due to an increase in loans, partially offset by decreases in cash and
investment securities.  Deposits at December 31, 2008 were $310.8
million, a decrease of $6.9 million, or 2.2% from $317.7 million at March 31,
2008.  The decrease in deposits was primarily due to management’s
decision to not compete aggressively with high rate retail CDs offered by
competitors in the Company’s market area.  Borrowed funds at a cost
lower than retail deposit rates were used to partially offset the decrease in
deposits.





Stockholders’
equity at December 31, 2008 amounted to $34.1 million, or 8.41% of total assets,
compared to $34.1 million, or 8.49% of total assets, at March 31,
2008.  During this period, net income was offset by cash dividends and
a decrease in accumulated other comprehensive income.





Established in 1899, Wayne Savings
Community Bank, the wholly owned subsidiary of Wayne Savings Bancshares, Inc.,
has eleven full-service banking locations in the communities of Wooster,
Ashland, Millersburg, Rittman, Lodi, North Canton, and Creston,
Ohio.











MORE

















Statements
contained in this news release which are not historical facts may be
forward-looking statements as that term is defined in the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements are subject to
risks and uncertainties which could cause actual results to differ materially
from those currently anticipated due to a number of factors. Factors which could
result in material variations include, but are not limited to, changes in
interest rates which could affect net interest margins and net interest income,
competitive factors which could affect net interest income and noninterest
income, changes in demand for loans, deposits and other financial services in
the Company's market area; changes in asset quality, general economic conditions
as well as other factors discussed in documents filed by the Company with the
Securities and Exchange Commission from time to time. The Company undertakes no
obligation to update these forward-looking statements to reflect events or
circumstances that occur after the date on which such statements were
made.





CONTACT
      PERSON:
            H.
      STEWART FITZ GIBBON III


EXECUTIVE
      VICE PRESIDENT


CHIEF
      FINANCIAL OFFICER


(330)
      264-5767







WAYNE
      SAVINGS BANCSHARES, INC.CONDENSED
      CONSOLIDATED BALANCE SHEETS(Dollars
      in thousands, except per share data)December 31,
      2008
                                                              
                                                              
                                                              March 31,
      2008(Unaudited)ASSETSCash
      and cash equivalents
                                                              
                                                              $
                                                              10,696
                                                              
                                                              
                                                              $
                                                              13,063Investment
      securities, net (1)
                                                              
                                                              
                                                              115,125
                                                              
                                                              
                                                              
                                                              121,410Loans
      receivable, net
                                                              
                                                              
                                                              255,122
                                                              
                                                              
                                                              
                                                              242,255Federal
      Home Loan Bank stock
                                                              
                                                              
                                                              5,025
                                                              
                                                              
                                                              
                                                              4,892Premises
      & equipment
                                                              
                                                              
                                                              7,680
                                                              
                                                              
                                                              
                                                              8,012Foreclosed
      assets held for sale, net
                                                              
                                                              
                                                              735
                                                              
                                                              
                                                              
                                                              93Other
      assets
                                                              
                                                              
                                                              10,987
                                                              
                                                              
                                                              
                                                              11,859TOTAL  ASSETS
                                                              
                                                              $
                                                              405,370
                                                              
                                                              
                                                              $
                                                              401,584LIABILITIES
      AND STOCKHOLDERS' EQUITYDeposit
      accounts
                                                              
                                                              $
                                                              310,811
                                                              
                                                              
                                                              $
                                                              317,731Other
      short-term borrowings
                                                              
                                                              
                                                              11,592
                                                              
                                                              
                                                              
                                                              7,287Federal
      Home Loan Bank Advances
                                                              
                                                              
                                                              44,500
                                                              
                                                              
                                                              
                                                              38,500Accrued
      interest payable and other liabilities
                                                              
                                                              
                                                              4,380
                                                              
                                                              
                                                              
                                                              3,962TOTAL
      LIABILITIES
                                                              
                                                              
                                                              371,283
                                                              
                                                              
                                                              
                                                              367,480Common
      stock (3,978,731 shares of $.10 par value issued)
                                                              
                                                              
                                                              398
                                                              
                                                              
                                                              
                                                              398Additional
      paid-in capital
                                                              
                                                              
                                                              36,166
                                                              
                                                              
                                                              
                                                              36,127Retained
      earnings
                                                              
                                                              
                                                              12,636
                                                              
                                                              
                                                              
                                                              12,450Shares
      acquired by ESOP
                                                              
                                                              
                                                              (1,015
                                                              )
                                                              
                                                              
                                                              (1,097
                                                              )Treasury
      Stock, at cost (974,618 and 969,627 shares at December 31, 2008
      andMarch
      31, 2008, respectively)
                                                              
                                                              
                                                              (14,530
                                                              )
                                                              
                                                              
                                                              (14,481
                                                              )Accumulated
      other comprehensive income
                                                              
                                                              
                                                              432
                                                              
                                                              
                                                              
                                                              707TOTAL
      STOCKHOLDERS' EQUITY
                                                              
                                                              
                                                              34,087
                                                              
                                                              
                                                              
                                                              34,104TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
                                                              
                                                              $
                                                              405,370
                                                              
                                                              
                                                              $
                                                              401,584(1)  Includes
      held to maturity classifications.









WAYNE
      SAVINGS BANCSHARES, INC.CONDENSED
      CONSOLIDATED STATEMENTS OF INCOME(Dollars
      in Thousands, except per share data -- unaudited)Three
      Months Ended
                                                            
                                                            
                                                            Nine
      Months EndedDecember
      31,
                                                            
                                                            
                                                            December
      31,2008
                                                            
                                                            
                                                            2007
                                                            
                                                            
                                                            2008
                                                            
                                                            
                                                            2007Interest
      income
                                                            
                                                            $
                                                            5,408
                                                            
                                                            
                                                            $
                                                            5,826
                                                            
                                                            
                                                            $
                                                            16,272
                                                            
                                                            
                                                            $
                                                            17,318Interest
      expense
                                                            
                                                            
                                                            2,290
                                                            
                                                            
                                                            
                                                            3,030
                                                            
                                                            
                                                            
                                                            7,259
                                                            
                                                            
                                                            
                                                            8,922Net
      interest income
                                                            
                                                            
                                                            3,118
                                                            
                                                            
                                                            
                                                            2,796
                                                            
                                                            
                                                            
                                                            9,013
                                                            
                                                            
                                                            
                                                            8,396Provision
      for loan losses
                                                            
                                                            
                                                            185
                                                            
                                                            
                                                            
                                                            140
                                                            
                                                            
                                                            
                                                            346
                                                            
                                                            
                                                            
                                                            195Net
      interest income after provision for loan losses
                                                            
                                                            
                                                            2,933
                                                            
                                                            
                                                            
                                                            2,656
                                                            
                                                            
                                                            
                                                            8,667
                                                            
                                                            
                                                            
                                                            8,201Noninterest
      income
                                                            
                                                            
                                                            421
                                                            
                                                            
                                                            
                                                            458
                                                            
                                                            
                                                            
                                                            1,310
                                                            
                                                            
                                                            
                                                            1,375Noninterest
      expense
                                                            
                                                            
                                                            2,568
                                                            
                                                            
                                                            
                                                            2,543
                                                            
                                                            
                                                            
                                                            7,668
                                                            
                                                            
                                                            
                                                            7,567Income  before
      federal income taxes
                                                            
                                                            
                                                            786
                                                            
                                                            
                                                            
                                                            571
                                                            
                                                            
                                                            
                                                            2,309
                                                            
                                                            
                                                            
                                                            2,009Provision
      for federal income taxes
                                                            
                                                            
                                                            202
                                                            
                                                            
                                                            
                                                            125
                                                            
                                                            
                                                            
                                                            593
                                                            
                                                            
                                                            
                                                            493Net
      income
                                                            
                                                            $
                                                            584
                                                            
                                                            
                                                            $
                                                            446
                                                            
                                                            
                                                            $
                                                            1,716
                                                            
                                                            
                                                            $
                                                            1,516Earnings
      per shareBasic
                                                            
                                                            $
                                                            0.20
                                                            
                                                            
                                                            $
                                                            0.14
                                                            
                                                            
                                                            $
                                                            0.59
                                                            
                                                            
                                                            $
                                                            0.49Diluted
                                                            
                                                            $
                                                            0.20
                                                            
                                                            
                                                            $
                                                            0.14
                                                            
                                                            
                                                            $
                                                            0.59
                                                            
                                                            
                                                            $
                                                            0.49Dividends
      per share
                                                            
                                                            $
                                                            0.12
                                                            
                                                            
                                                            $
                                                            0.12
                                                            
                                                            
                                                            $
                                                            0.36
                                                            
                                                            
                                                            $
                                                            0.36















WAYNE
      SAVINGS BANCSHARES, INC.CONSOLIDATED
      FINANCIAL HIGHLIGHTS(Dollars
      in thousands, except per share data - unaudited)For
      the Three Monthsended
      December 31,2008
                                    
                                    
                                    2007Quarterly
      ResultsNet
      Interest Income
                                    
                                    $
                                    3,118
                                    
                                    
                                    $
                                    2,796Net
      Income
                                    
                                    $
                                    584
                                    
                                    
                                    $
                                    446Earnings
      Per Share:Basic
                                    
                                    $
                                    0.20
                                    
                                    
                                    $
                                    0.14Diluted
                                    
                                    $
                                    0.20
                                    
                                    
                                    $
                                    0.14Return
      on Average Assets (Annualized)
                                    
                                    
                                    0.58
                                    %
                                    
                                    
                                    0.44
                                    %Return
      on Average Equity (Annualized)
                                    
                                    
                                    7.03
                                    %
                                    
                                    
                                    5.14
                                    %For
      the Nine Monthsended
      December 31,2008
                                    
                                    
                                    2007Year to Date
      ResultsNet
      Interest Income
                                    
                                    $
                                    9,013
                                    
                                    
                                    $
                                    8,396Net
      Income
                                    
                                    $
                                    1,716
                                    
                                    
                                    $
                                    1,516Earnings
      Per Share:Basic
                                    
                                    $
                                    0.59
                                    
                                    
                                    $
                                    0.49Diluted
                                    
                                    $
                                    0.59
                                    
                                    
                                    $
                                    0.49Return
      on Average Assets (Annualized)
                                    
                                    
                                    0.57
                                    %
                                    
                                    
                                    0.51
                                    %Return
      on Average Equity (Annualized)
                                    
                                    
                                    6.97
                                    %
                                    
                                    
                                    5.89
                                    %December
      31,
                                    
                                    
                                    March
      31,2008
                                    
                                    
                                    2008End of Period
      DataTotal
      Assets
                                    
                                    $
                                    405,370
                                    
                                    
                                    $
                                    401,584Stockholders'
      Equity to Total Assets
                                    
                                    
                                    8.41
                                    %
                                    
                                    
                                    8.49
                                    %Shares
      Outstanding
                                    
                                    
                                    3,004,113
                                    
                                    
                                    
                                    3,009,104Book
      Value Per Share
                                    
                                    $
                                    11.35
                                    
                                    
                                    $
                                    11.33