EXHIBIT 99.1

Citizens South Banking Corporation Announces 2011 First Quarter Financial Results

GASTONIA, N.C., April 25, 2011 (GLOBE NEWSWIRE) -- Citizens South Banking Corporation (Nasdaq:CSBC), the parent company of Citizens South Bank, reported a net loss available to common stockholders of $1.1 million, or $0.10 per diluted share, for the quarter ended March 31, 2011, compared to net income available to common stockholders of $10.0 million, or $1.29 per diluted share, for the quarter ended March 31, 2010. The financial results for the quarter ended March 31, 2010, included an $18.7 million pre-tax gain related to the acquisition of Bank of Hiawassee and $787,000 in acquisition-related expenses.

President Kim S. Price stated, "We are encouraged by a number of indicators in this quarter's results, including healthy expansion of our net interest margin, continued growth in our core deposits, and a decrease in our level of past due loans. We continue to focus on ways to improve our asset quality while continuing to build the level of our loan loss reserves."

First Quarter Financial Highlights:

Credit Quality

The Company's credit quality results for the quarter are mixed but continue to compare favorably with southeastern peers as the Company reported lower net charge-offs,  fewer past due loans, and higher loan loss reserves during the first quarter. These positive trends are accompanied by higher levels of non-covered nonperforming assets. The Company's level of past due non-covered loans (loans not covered under FDIC loss-share agreements) decreased during the first quarter by $8.1 million, or 58.7%, to 0.97% of total non-covered loans at March 31, 2011. This represented the Company's lowest level of past due non-covered loans in over two years. In addition, criticized and classified assets decreased during the first quarter of 2011. Criticized assets decreased by 6.0% from $76.4 million, or 13.0% of non-covered loans at December 31, 2010, to $71.6 million, or, 12.2% of non-covered loans at March 31, 2011. Also, classified assets decreased from $52.2 million, or 8.9% of non-covered loans at December 31, 2010, to $51.3 million, or 8.7% of non-covered loans at March 31, 2011. 

As loans continue to move through the disposition process, updated collateral values are obtained and loans are written down on the Company's books to fair value. As a result, net charge-offs during the first quarter of 2011 totaled $2.9 million, or 1.99% of average non-covered loans, as compared to $3.8 million, or 2.59% of average non-covered loans during the fourth quarter of 2010. Also as part of the disposition process, we transferred a number of past due loans to nonaccrual status during the quarter. This contributed to a $9.2 million increase in non-covered nonperforming assets to $33.2 million, or 3.19% of total assets, at March 31, 2011. 

Due in part to the decline in net charge-offs and past due loans during the quarter, the Company reduced its loan loss provision from $5.0 million during the fourth quarter of 2010 to $3.0 million during the first quarter of 2011. Despite this decrease in the loan loss provision, our allowance for loan losses to total non-covered loans increased from 2.02% at December 31, 2010, to 2.05% at March 31, 2011. 

President Price commented, "The general economy and local real estate markets continue to be choppy with some signs of improving lot and home sales as well as declining levels of unemployment. These factors have resulted in slower inflows of delinquent loans."

Net Interest Margin

The Company's net interest margin improved by 17 basis points on a linked quarter basis from 3.25% for the fourth quarter of 2010 to 3.42% for the first quarter of 2011. This improvement was largely due to a 19 basis point decrease in the Company's cost of funds. Given the Company's high level of liquidity coupled with strong core deposit growth, we have been able to either repay maturing time deposits or reprice these time deposits at lower market rates at maturity. Also, during the quarter the Company invested approximately $40 million in U.S. Government agency mortgage-backed securities using excess liquidity.  

Balance Sheet Changes

Despite some improving trends in local economic conditions, loan demand remains soft. Total non-covered loans decreased by $2.0 million during the quarter. However, all of this decrease was experienced in January as we experienced slight increases in total non-covered loans for the last two months of the quarter.   Management continues to work on reducing the Company's exposure in the residential construction and acquisition and development loan portfolios while continuing to focus on increasing business loans to the professional market, owner-occupied commercial real estate loans, and residential and personal loans to qualified consumers.

The Company continues to experience strong core deposit growth. During the first quarter of 2011, non-time core deposits increased by $8.7 million, or 8.7% annualized, to $410.7 million. This growth was primarily driven by non-interest bearing demand deposit accounts, which increased by $8.3 million, or 47.3% annualized, for the first quarter of 2011. The strong growth in core deposits is attributable to a continued focus on deposit gathering, enhanced treasury management services, and increased market share due to mergers and a general "flight to quality" among community bank depositors.

Capital

The Company's tangible common equity ratio increased from 6.69% at December 31, 2010, to 6.73% at March 31, 2011. The Bank's capital levels continue to exceed all regulatory capital measures and the Bank was considered "well-capitalized" for regulatory purposes at March 31, 2011. This is the highest capital designation established by the Bank's regulatory authorities. At March 31, 2011, the Bank's total risk-based capital ratio was 16.68%, which was 167% higher than the 10.00% regulatory minimum capital ratio to be considered "well-capitalized." The Company's capital position continues to be a source of strength and provides a competitive advantage during these uncertain economic times. 

Income Statement Changes

Excluding acquisition-related items, the Company's noninterest income increased by $281,000, or 19.4%, for the first quarter of 2011. This increase was largely due to a $158,000 increase in service charges on deposit accounts, a $27,000 increase in mortgage banking income and a $113,000 increase in other noninterest income.

Noninterest expense increased by $1.3 million, or 20.7%, during the first quarter of 2011 to $7.7 million for the quarter ended March 31, 2011. This increase was primarily related to the Bank of Hiawassee acquisition and increased credit-related expenses arising from the disposition of troubled assets. As a result of the acquisition, the Company added five additional offices, for a total of 21 offices.

About Citizens South Banking Corporation   

Citizens South Bank was founded in 1904 and is headquartered in Gastonia, North Carolina. Deposits are FDIC insured up to applicable regulatory limits. At March 31, 2011, the Company had $1.0 billion in assets with 21 full-service offices in the Charlotte and North Georgia regions, including Gaston, Iredell, Rowan, Mecklenburg, and Union counties in North Carolina, York County in South Carolina, and Towns, Union, and Fannin counties in Georgia. Citizens South Bank is an Equal Housing Lender and Member, FDIC. The Bank is a wholly-owned subsidiary of Citizens South Banking Corporation, and shares of the common stock of the Company trade on the NASDAQ Global Market under the ticker symbol "CSBC." The Company maintains a website at www.citizenssouth.com that includes information on the Company, along with a list of products and services, branch locations, current financial information, and links to the Company's filings with the SEC.

The Citizens South Banking Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=7099

Forward-looking Statements

This news release contains certain forward-looking statements which include, but are not limited to, statements of our earnings expectations, statements regarding our operating strategy, and estimates of our future costs and benefits. These forward-looking statements are based on our current beliefs and expectations and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Forward-looking statements speak only as of the date they are made and the Company is under no duty to update these forward-looking statements to reflect circumstances or events that occur after the date of the forward-looking statements or to reflect the occurrence of unanticipated events. A number of factors could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Factors that could cause such a difference include, but are not limited to, changes in general economic conditions – either locally or nationally, competition among depository and financial institutions, the continuation of current revenue and expense trends, significant changes in interest rates, unforeseen changes in the Company's markets, and legal, regulatory, or accounting changes. The Company's reports filed from time to time with the Securities and Exchange Commission, including the Company's Form 10-K for the year ended December 31, 2010, describe some of these factors.

CONTACT: Gary F. Hoskins, CFO
         (704) 884-2263
         gary.hoskins@citizenssouth.com