Exhibit 99
Exhibit 99
INVESTOR PRESENTATIONS
September 2004
Forward Looking Statements
This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about (i) the benefits of the merger between Provident Financial Services (“Provident” or “PFS”) and First Sentinel Bancorp, Inc. (“First Sentinel” or “FSLA”), including future financial and operating results, cost savings and accretion to reported earnings that may be realized from the merger; (ii) Provident’s and First Sentinel’s plans, objectives, expectations and intentions and other statements contained in this presentation that are not historical facts; and (iii) other statements identified by words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates” or words of similar meaning. These forward-looking statements are based upon the current beliefs and expectations of Provident’s and First Sentinel’s management 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. Actual results may differ materially from the anticipated results discussed in these forward-looking statements.
The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: (1) the businesses of Provident and First Sentinel may not be combined successfully, or such combination may take longer to accomplish than expected; (2) the cost savings from the merger may not be fully realized or may take longer to realize than expected; (3) operating costs, customer loss and business disruption following the merger, including adverse effects on relationships with employees, may be greater than expected; (4) governmental approvals of the merger may not be obtained, or adverse regulatory conditions may be imposed in connection with governmental approvals of the merger; (5) the stockholders of First Sentinel or Provident may fail to approve the merger; (6) adverse governmental or regulatory policies may be enacted; (7) the interest rate environment may further compress margins and adversely affect net interest income; (8) the risks associated with continued diversification of assets and adverse changes to credit quality; (9) difficulties associated with achieving expected future financial results; (10) competition from other financial services companies in Provident’s and First Sentinel’s markets; (11) the risk of an economic slowdown that would adversely affect credit quality and loan originations. Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in Provident’s and First Sentinel’s reports (such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K) filed with the Securities and Exchange Commission and available at the SEC’s Internet site (http://www.sec.gov). All subsequent written and oral forward-looking statements concerning the proposed transaction or other matters attributable to Provident or First Sentinel or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements above. Except as required by law, Provident and First Sentinel do not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statement is made.
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Our Company Profile
(as of June 30, 2004)
$4.3 billion in Assets
$2.7 billion in Deposits
$2.4 billion in Loans
54 branches in 10 counties in northern and central New Jersey
A full-service bank:
Full Range of Retail and Commercial Deposit Products
Retail and Commercial Lending
Trust Services and Investment Services
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Our Company Profile
On July 14, 2004, we completed the acquisition of First Sentinel Bancorp, Inc. and the merger of its wholly-owned subsidiary First Savings Bank, with and into The Provident Bank
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Our Current Market:
Solidifying Provident’s Franchise in Central NJ
Morris
Somerset
Middlesex
Mercer
Burlington
Union
Essex
Bergen
Hudson
Richmond
Monmouth
Ocean
New York
Bronx
Queens
Kings
Provident Branches
First Sentinel Branches
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OUR STRENGTHS:
Tradition, Commitment, Focus
Tradition of Safe & Sound Management
New Jersey’s Oldest Bank; Established 1839
Commitment to Profitable Growth
Commitment to Prudently Deploy Capital
Commitment to Maintain Asset Quality
Unwavering Customer Focus
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Our Strategic Initiatives
Grow the Balance Sheet and Market Share
M&A Activity, De Novo Branching, and Organic Growth
Sustain and Increase Brand Awareness
Customer Relationship Management
Maximize Net Interest Income without Compromising Asset Quality
Focus on Accelerating Revenue Growth and Slowing Operating Expense Growth
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Our Business Drivers
Reinforce Pay-for-Performance Sales Culture
Maintain Diversified Loan Portfolio Composition
Continue to Increase proportion of Core Deposits to Total Deposits
Customer Relationship Management Process:
Maximize Product Penetration among Current Households
Continually Reduce Attrition
Increase New Customer Acquisition
Integrate Consistent Sales Process and Customer Treatment across all Delivery Channels
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Our Financial Performance
($in millions) 6/30/04 3/31/04 12/31/03
Assets $4,296.3 $4,258.2 $4,284.9
Loans, net $2,360.7 $2,255.4 $2,216.7
Deposits $2,743.9 $2,691.9 $2,696.0
Total Stockholders’ Equity $816.3 $823.2 $817.1
Net Income $8.6 $10.3 $18.7*
Net Interest Margin 3.28% 3.50% 3.35%
* includes $15.6 million net of tax one-time contribution to The Provident Bank Foundation
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Loan Diversification Strategy
Long-term Strategy—Maintain even balance between Retail Loan Portfolio and Commercial Loan Portfolio.
Substantially all Warehouse Lines of Credit have been sold. Assets re-deployed into 1-4 family residential loans.
Near-term Strategy will favor Retail Loans.
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Loan Portfolio Diversification
to improve asset yields to reduce exposure to interest rate risk
70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%
60.24%
39.76%
58.01%
41.69%
58.37%
41.27%
2003
3/31/2004
6/30/04
Residential Real Estate and Consumer Loans
Commercial Real Estate, Mortgage Warehouse and Business Loans
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Building the Commercial Loan Portfolio $ in millions
700 600
500
400
300 200
100
0
246.6
638.7
296.4
652.3
328.2
654.7
2003
3/31/2004
6/30/2004
Commercial & Industrial
Commercial Real Estate
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Core Deposit Emphasis
to expand customer relationships to effectively manage interest rate expense
70.00%
60.00%
50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
35.00%
65.00%
Dec. 2003
34.91%
65.09%
3/31/2004
33.93%
66.07%
6/30/2004
Time Deposits Core Deposits
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Building Core Customer Deposit Balances $ in millions
1000 900 800 700 600 500 400 300 200 100 0
Dec. 2003
775
987.9
3/31/2004
769.2
982.7
6/30/2004
815.5
997.3
Demand Deposits Savings Deposits
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Dual Strategy of Loan Diversification and Core Deposit
Emphasis has resulted in Net Interest Income Growth
$ in millions
140 120 100 80 60 40 20 0
Dec. 2003
3/31/2004
6/30/2004
Interest Income Interest Expense Net Interest Income
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Commitment to Asset Quality
0.30% 0.25% 0.20% 0.15% 0.10%
0.05% 0.00%
0.27%
Dec. 2003
0.19%
3/31/2004
0.17%
6/30/2004
% of Non-performing Loans to Total Loans
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Capital Management Strategies for Earnings per Share Growth
Declaration of Cash Dividend after first quarter of operation as a public company. Second increase recently announced.
Stock buy-backs commenced in 2003 to fund stockholder-approved benefit plans
Corporate stock buy-backs approved for 2004
Opportunities limited by merger announcement
Continuing assessment of merger opportunities
Leverage strategies where warranted
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Our Vision
Investors seek
Financial Performance
Which will be Driven by
Customers seek
Customer-Centricity
Which will be Driven by
Employees seek
Focused & Rewarded Workforce
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Strategic Growth in New Jersey’s Most Attractive Markets
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Summary of Significant Terms
$22.25 per share
Value per First Sentinel Share:
60% stock / 40% cash
Consideration:
Fixed at 1.092 Provident shares for each First Sentinel share(1)
Exchange Ratio:
Tax-free exchange with election mechanism
Transaction Structure:
Approximately 20% of First Sentinel’s expenses
Estimated Cost Savings:
1. Based on PFS average closing share price for 20 consecutive trading days ended December 18, 2003.
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Summary
Adds highly attractive franchise in one of New Jersey’s best banking markets
Highly accretive to EPS with solid internal rate of return
In-market transaction with conservative cost savings assumptions
First Sentinel possesses strong fundamentals
Management additive
Effective deployment of conversion proceeds
Consistent with Provident’s expansion strategy
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