Ameriana Bancorp (NASDAQ: ASBI), parent company for Ameriana Bank, today announced that net income for the fourth quarter of 2011 increased to $453,000, or $0.15 per basic and diluted share, from $102,000, or $0.03 per basic and diluted share, for the fourth quarter of 2010. For 2011, Ameriana's net income increased to $1.1 million, or $0.38 per basic and diluted share, from $553,000, or $0.19 per basic and diluted share, in the year-earlier period. Commenting on the announcement, Jerome J. Gassen, President and Chief Executive Officer, said, "We are pleased to report a solid finish to 2011 as net income reached the highest level of the year in the fourth quarter, capping 10 consecutive quarters of profitability for Ameriana. Several factors contributed to the earnings momentum we witnessed as the year came to an end, including moderate, but steady improvements in credit quality, as the migration of loans to non-performing status slowed. Net charge-offs on loans remained high in the fourth quarter as we continued to work though problem loans and reduce the overall level of non-performing loans (NPLs), but we were able to offset these higher credit costs by recognizing further gains from our securities portfolio as well as gains on the sale of other real estate owned (OREO). Overall, the progress we have achieved in our loan portfolio has been encouraging." The Company recorded $213,000 in security gains in the fourth quarter of 2011, along with $120,000 of net gains on OREO. "We also were encouraged to see signs in the fourth quarter of increased optimism among business customers regarding the economic outlook, which resulted in a pick-up in demand for business lending in December," Gassen continued. "We are cautiously optimistic that this increased business lending will lead to further overall economic strengthening. However, we recognize that several overarching issues could still dampen the apparent recovery and thereby affect our future outlook. The most significant of these is the health of the housing market, and while we are hopeful that overall credit quality will continue to improve, the housing market to date remains the weakest sector of the economy and continues to have the greatest bearing on the future level of NPLs and our efforts to dispose of OREO. Also, with the increase in business activity, it remains unclear how the current ongoing low interest rate environment will ultimately affect the yield curve; a flattening of the curve would likely pressure margins.