Exhibit 99.1

PEOPLES FEDERAL BANCSHARES, INC. ANNOUNCES FOURTH QUARTER AND FISCAL 2012 FINANCIAL RESULTS

Brighton, Massachusetts, October 31, 2012.  Peoples Federal Bancshares, Inc. (the “Company”) (Nasdaq: PEOP), the holding company for Peoples Federal Savings Bank (the “Bank”), announced fourth quarter loss and year to date earnings for the fiscal year ending September 30, 2012.

For the three months ended September 30, 2012, the Company reported a net loss of $323,000 or ($0.05) per share, basic, as compared to net income of $567,000, or $0.09 per share, basic and diluted, for the three months ended June 30, 2012 and as compared to $559,000, or $0.09 per share, basic and diluted, for the three months ended September 30, 2011.  For the fiscal year ended September 30, 2012, the Company reported net income of $1.7 million, or $0.26 per share, basic and diluted, as compared to net income of $3.1 million or $0.47 per share, basic and diluted, for the same period last year.

The fiscal fourth quarter loss and reduced annual income versus fiscal 2011 resulted primarily from the Company establishing a valuation allowance of $991,000 during the quarter ended September 30, 2012, against a deferred tax asset which was created due to a charitable contribution made in conjunction with the Company’s initial public offering in 2010.  A valuation allowance is established against deferred tax assets when, based upon the available evidence, including historical and projected taxable income, management determines that it is more likely than not that some or all of the deferred tax asset will not be realized.

Net interest and dividend income for the three months ended September 30, 2012 totaled $4.3 million as compared to $4.2 million for the three months ended September 30, 2011.  For the three months ended September 30, 2012, the Company’s net interest rate spread and net interest rate margin decreased to 3.06% and 3.26%, respectively, compared to 3.12% and 3.35%, respectively, for the same 2011 period.  Decreases in both the Company’s net interest rate spread and net interest margin reflect declining interest rates and the increase in average balances of total interest-bearing liabilities, offset by increases in average balances of total interest-earning assets.  The Company’s ratio of total interest-bearing assets to total interest-bearing liabilities improved to 1.32x from 1.30x for the three months ended September 30, 2012 compared to the same 2011 period.

Non-interest income totaled $562,000 for the three months ended September 30, 2012 as compared to $299,000 for the three months ended September 30, 2011.  Non-interest expense totaled $3.7 million for the three months ended September 30, 2012 as compared to $3.4 million for the three months ended September 30, 2011, primarily due to increased expenses in salaries and employee benefits that increased to $2.5 million from $2.3 million.  Included in salaries and employee benefits for the quarter ended September 30, 2012 were expenses of $333,000 related to the equity incentive plan adopted in February 2012.  Other non-interest expense increases included professional fees, which increased to $133,000 from $130,000, occupancy expense, which increased to $238,000 from $231,000, data processing expense, which increased to $211,000 from $201,000, advertising expense, which increased to $110,000 from $94,000, and deposit insurance expense, which increased to $75,000 from $62,000.  Equipment expense and other expense decreased slightly during the comparable three month periods ended September 30, 2012 and 2011.

Net interest and dividend income for the fiscal year ended September 30, 2012 totaled $17.0 million as compared to $16.4 million for the fiscal year ended September 30, 2011.  For the fiscal year ended September 30, 2012, the Company’s net interest rate spread and net interest rate margin increased to 3.12% and 3.32%, respectively, compared to 3.05% and 3.31%, respectively, for the same 2011 period.  Increases in both the Company’s net interest rate spread and net interest margin reflect the increase in average balances of total interest-earning assets, offset by declining interest rates and the increase in average balances of total interest-bearing liabilities.  The Company’s ratio of total interest-bearing assets to total interest-bearing liabilities decreased slightly to 1.31x from 1.32x for the fiscal year ended September 30, 2012 compared to the same 2011 period.

Non-interest income totaled $1.8 million for the fiscal year ended September 30, 2012 as compared to $1.7 million for the fiscal year ended September 30, 2011.  Non-interest expense totaled $14.1 million for the fiscal year ended September 30, 2012 as compared to $12.8 million for the fiscal year ended September 30, 2011, primarily due to increased expenses in salaries and employee benefits that increased to $9.6 million from $8.3

million.  Included in salaries and employee benefits for the fiscal year ended September 30, 2012 were expenses of $889,000 related to the equity incentive plan adopted in February 2012.  Other non-interest expense increases include occupancy expense, which increased to $920,000 from $857,000, data processing expense, which increased to $811,000 from $749,000, advertising expense, which increased to $558,000 from $240,000, and equipment expense, which increased to $437,000 from $436,000.  These increases were offset in part by decreases in deposit insurance expense, which decreased to $251,000 from $400,000, professional fees expense, which decreased to $488,000 from $574,000, and other expense, which decreased to $1.1 million from $1.2 million.

Since September 30, 2011, total assets have increased by $16.6 million, or 3.0%, to $570.8 million.  Net loans increased $43.6 million, or 10.7% during fiscal 2012.  The increase in loans was due to an increase in residential real estate, commercial loans and consumer loans, offset by a decrease in commercial real estate loans and construction loans.  Cash and cash equivalents decreased by $25.5 million, to $36.2 million at September 30, 2012 from $61.7 million at September 30, 2011, as we continue to deploy cash and cash equivalents into loans and investment securities.  Federal Home Loan Bank borrowings increased by $15.0 million, or 83.3%, from September 30, 2011, as the Company took advantage of low interest rates.  Deposits increased to $416.7 million at September 30, 2012 from $412.6 million at September 30, 2011.  At September 30, 2012, total stockholders’ equity was $110.5 million, a decrease of $5.2 million from $115.7 million at September 30, 2011.  The decrease resulted primarily from the repurchase of 527,996 shares of the Company’s common stock totaling $8.0 million, in the open market as part of the Company’s previously announced stock repurchase plan, expense related to the Company grant of 281,700 shares of restricted stock awards to its Board of Directors and certain employees of the Company and aggregate payment of $181,000 in dividends paid during 2012.  The decrease in stockholders’ equity was offset primarily by net income of $1.7 million, equity incentive shares earned of $889,000 and ESOP stock released and committed to be released of $441,000, for the year ended September 30, 2012.

Non-performing assets totaled $5.2 million, or 0.92% of total assets, at September 30, 2012, as compared to $3.3 million, or 0.59% of total assets at September 30, 2011.  Classified loans decreased to $9.6 million as of September 30, 2012 compared to $12.6 million at September 30, 2011.  The Company recorded a $540,000 provision for loan losses during the year ended September 30, 2012, reflecting the overall increase in total loans along with the qualitative and quantitative changes within each loan portfolio segment.

Certain statements herein constitute “forward-looking statements” and actual results may differ from those contemplated by these statements.  Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts.  They often include words like “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.”  Certain factors that could cause actual results to differ materially from expected results include changes in the interest rate environment, changes in general economic conditions, legislative and regulatory changes that adversely affect the businesses in which Peoples Federal Bancshares, Inc. is engaged and changes in the securities market.  The Company disclaims any intent or obligation to update any forward-looking statements, whether in response to new information, future events or otherwise.

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PEOPLES FEDERAL BANCSHARES, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

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PEOPLES FEDERAL BANCSHARES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

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The following tables set forth average assets, liability and equity account balances, average yields and costs, and certain other information for the periods indicated.  No tax-equivalent yield adjustments were made, as the effect thereof was not material.  All average balances are daily average balances.  Non-accrual loans were included in the computation of average balances, but have been reflected in the table as loans carrying a zero yield.  The yields set forth below include the effect of deferred fees, discounts and premiums that are amortized or accreted to interest income or expense.

(1)         Yields are annualized.

(2)         Average loans include non-accrual loans and are net of average deferred loan fees/costs.

(3)         Average balances are presented at average amortized cost.

(4)         Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.

(5)         Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

(6)         Net interest margin represents net interest income divided by average total interest-earning assets.

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(1)          Average loans include non-accrual loans and are net of average deferred loan fees/costs.

(2)          Average balances are presented at average amortized cost.

(3)          Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.

(4)          Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

(5)          Net interest margin represents net interest income divided by average total interest-earning assets.

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