Heritage Financial Group Reports Ownership of Freddie Mac Securities

BUSINESS WIRE --Heritage Financial Group (NASDAQ:HBOS), the mid-tier holding company for HeritageBank of the South, today announced that it currently holds approximately $1.5 million par value of Freddie Mac preferred stock in its available-for-sale investment portfolio. The Company has no additional equity exposure to Fannie Mae or Freddie Mac equity securities. Following the U.S. government's actions earlier this week to place Freddie Mac under conservatorship and eliminate its dividends on preferred stock, the Company has seen a dramatic decrease in the value of this investment.

Management currently is examining tax issues and accounting treatment related to the decline in value of this investment. The Company is uncertain if it will be able to recognize a tax benefit if this investment is written down to market value. As of September 10, 2008, the fair value of the Company's investment in Freddie Mac preferred stock was approximately $150,000. As of June 30, 2008, the fair value of this investment was approximately $1.3 million.

At the end of the second quarter of 2008, Heritage Financial Group reported that its total risk-based capital ratio was approximately 17% – significantly above the 10% level required to be considered "well capitalized." The Company will remain well capitalized at the end of the third quarter, even if the Freddie Mac investment is written down to its fair market value, or if deemed worthless, with no corresponding tax benefit.

Heritage Financial Group is the mid-tier holding company for HeritageBank of the South, a community-oriented bank serving primarily Southwest Georgia and North Central Florida through seven full-service banking offices. As of June 30, 2008, the Company reported total assets of approximately $487.6 million and total stockholders' equity of approximately $63.3 million. For more information about the Company, visit HeritageBank of the South on the Web at www.eheritagebank.com, and see Investor Relations under About Us.

Heritage, MHC, a mutual holding company formed in 2002, holds approximately 74% of the shares of Heritage Financial Group. The remaining 26% of Heritage Financial Group's shares are held by public stockholders following the Company's June 2005 initial public offering.

Except for historical information contained herein, the matters included in this news release and other information in the Company's filings with the Securities and Exchange Commission may contain certain "forward-looking statements," within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Reform Act of 1995 and include this statement for purposes of these safe harbor provisions. Further information concerning the Company and its business, including additional factors that could materially affect our financial results, is included in our other filings with the SEC.

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Heritage Bank’s Parent Company, CCF Holding Company, Ranked Among Top 100 Community Banks Nationwide

The holding company for Heritage Bank, CCF Holding Company, has been ranked 77th among publicly traded community banks nationwide according to USBanker. The listing, which places Heritage Bank in the top three of all Georgia banks listed in the ranking, was based on three-year average return on equity.

“This is good news at a time where there is not a lot of good news being shared in the financial industry, and each of Heritage Bank’s employees has contributed to this honor,” said Leonard Moreland, Executive Vice President of CCF Holding Company and CEO of Heritage Bank. “We are a community bank that delivers results, and our company’s 54-year heritage is a direct result of our team’s pride in their work and dedication to excellence.”

Heritage Bank, a state chartered commercial bank, has been serving metro Atlanta’s Southern Crescent since 1955. The independent community bank has seven full service offices, features a well-rounded offering of commercial and consumer products, and is an active, involved member of the community it serves. The company’s stock is traded on The NASDAQ Small Cap Market under the symbol “CCFH.” For more information, please call 770-478-8881 or visit the Heritage Bank website at www.heritagebank.com.

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