Go to Layers, New Raster Layer, click Ok

Click on your shape tool set to ellipse.

Draw the circle..go from top left to bottom right.
Make sure of the direction or it will not do the text right.

Go up to Image, Flip

Click on text tool

Hover the text tool over the edge of the circle until you see the half circle under the A.

Then click on the Circle.
Type in your text and click Ok. Be sure your text is set to Floating, and it's Centered!! DO NOT DESELECT!

Now you should see the text upside down at the top of the circle.

Go to Image, Rotate, 180.. left or right doesn't matter
Your text will be right side up at the top.

Click on it and drag it down to the position you want.
With the text still selected, look at the top of your screen.
You should see Layer Palette.. around where your Tool Option window is..
if you don't then click on the Layer Palette that's on the tool bar.

Click on the Layer Palette window.  You'll see one of the bars says Floating Selection.

Right click on it and select Promote to Layer
Then go to the Layer below that, there should be a plus sign beside it to the left and when you hover your mouse over you should see the circle.

click on that, Right click, then select Delete. Bye bye circle.

You can do this on any graphic!
:-) Rebecca