Annual Meeting
April 25, 2007
Welcome To
7%
Increase
35%
Increase
Total Assets
13%
Increase
18%
Increase
26%
Increase
2
Total Assets
13%
Increase
25%
Increase
14%
Increase
22%
Increase
28%
Increase
3
Statement of Operations
Year
Net Income
Change From Prior Year
2002
$ 179
2003
$
1
,173
+ 555
%
2004
$1,359
+ 16
%
2005
$2,115
*
+ 5
6%
2006
$2,198
+ 4
%
*reflects a one time $449,000 reversal of the valuation allowance for taxes
4
Income Trend
2002
2003
2004
2005
2006
2007
1
st
Qtr.
$ 17
$ 110
$ 222
$ 262
$ 475
$
520
2
nd
Qtr.
130
272
313
345
485
3
rd
Qtr.
4
454
410
457
573
4
th
Qtr.
28
33
7
414
1,051*
665
*reflects a one time $449,000 reversal of the valuation allowance for taxes
5
Loan Growth - Total Balances
10%
Increase
20%
Increase
31%
Increase
31%
Increase
10%
Increase
6
Loan Mix Composition Total Balances
March 31, 2007
7
Net Interest Margin
4.15%
12/31/2006
3.92%
03/31/2007
4.31%
12/31/2005
3.78%
12/31/2004
3.40%
12/31/2003
3.52%
12/31/2002
8
Deposit Growth
Total Deposits
Core Deposits
15%
Increase
22%
Increase
31%
Increase
26%
Increase
14%
Increase
16%
Increase
25%
Increase
38%
Increase
30%
Increase
20%
Increase
9
Deposit Mix - Total Balances
86%
35,616
163,590
51,015
12/31/2006
90%
20,731
141,846
45,667
12/31/2005
85%
23,748
94,066
37,061
12/31/2004
79%
30,545
86,111
28,995
12/31/2003
66%
$42,538
$67,520
$15,386
12/31/2002
Core Deposits as a
% of Total Deposits
Time
Deposits
NOW/Money
Market/Savings
Demand
10
Number of Accounts
11
Paramount Checking
Total Balances
Number of Accounts
22%
Increase
16%
Increase
19%
Increase
15%
Increase
3%
Increase
11%
Increase
51%
Increase
48%
Increase
34%
Increase
22%
Increase
12
Paramount Checking -continued
Average Balance Per Account
13
Escrow Ease
Total Balances
14
Escrow Ease - continued
Number of Client Accounts
15
Transaction Activity
Teller Transactions
Per Month
ACH Transactions
Per Month
27%
Increase
8%
Increase
58%
Increase
34%
Increase
5%
Increase
33%
Increase
19%
Increase
55%
Increase
6%
Increase
23%
Increase
16
Asset Quality and Reserves
From the outset, we have implemented a
strong credit culture through the application
of sound banking principles.
As of December 31, 2006 Somerset Hills
Bancorp had non-performing loans of 0.25%
of total loans.
Loan loss reserves as of the same date
totaled $2.2 million.
Loan Loss Reserve 1.13% of total loans.
17
Capital Ratios
Actual
Well Capitalized
December 31, 2006
Amount
Ratio
Amount
Ratio
Total Capital (to risk
-
weighted assets)
$39,063
16.52
%
$23,645
>
10.00%
Tier I Capital (to risk
-
weighted assets)
36,893
15.60
14,187
>
6.00
Tier I Capital (to average asse
ts)
36,893
13.69
13,475
>
5.00
December 31, 2005
Total Capital (to risk
-
weighted assets)
$26,450
12.
7
3
%
$20,772
>
10.00%
Tier I Capital (to risk
-
weighted assets)
24,421
11.76
12,4
63
>
6.00
Tier I Capital (to average assets)
24,421
1
0.4
0
11,739
>
5.00
December 31, 2004
Total Capital (to risk
-
weighted assets)
$23,557
13.77
%
$17,106
>
10.00%
Tier I Capital (to risk
-
weighted assets)
21
,
923
12.82
10,263
>
6.00
Tier I Capital (to average assets)
21,923
11.83
9,268
>
5.00
18
Sullivan Financial Services, Inc.
a subsidiary of Somerset Hills Bank
Headquarters
100 Executive Drive, Suite 140
West Orange, NJ 07052
Phone: 973-325-5000
Fax: 973-736-7947
19
Sullivan Financial Services, Inc.
Products and Services
Conventional Mortgage Loans
Fixed and Adjustable Rate Loans
FHA/VA Loans
Jumbo Mortgages
1st Time Buyer Programs
No Doc Loans
No Cost Refinances
20
Sullivan Financial Services, Inc.
Loan Volume
2002
2003
2004
2005
2006
Originations
$404,513
$530,913
$330,491
$379,114
$341,689
Originations
1
,
701
2
,
159
1
,
297
1
,
362
1
,
293
Closings
$320,978
$505,384
$270,803
$311,273
$293,329
Closings
1
,
384
2
,
098
1
,
091
1
,
132
1
,
089
21
Somerset Hills Wealth Management, LLC
a subsidiary of Somerset Hills Bank
22
Somerset Hills Wealth Management, LLC
For the Individual:
Financial Planning
Investment Management
Estate Review
Life, Health & Long Term Care
Insurance
Property and Casualty Insurance
23
Somerset Hills Wealth Management, LLC
For the Business Owner:
Business Succession Planning
Buy-Sell & Key Person
Agreements
Retirement Plans & Group
Insurance
Property and Casualty Insurance
24
Somerset Hills Title Company, LLC
PROVIDING TITLE SERVICE IN CONNECTION WITH THE
CLOSING OF REAL ESTATE TRANSACTIONS
2005
2006
1
st
Qtr 2007
Total Transactions
62
36
6
Amount of Closed Transactions
(approximate)
$57
Million
$55
Million
$2
Million
Net
Income to Bank
$64
,000
$
101
,000
$
6,000
25
Look to the Future
Building the Franchise
Cross Sell Opportunities
Staffing Opportunities
New Branch Opportunities
Acquisition Opportunities
26
Where We Are
27
Grand Opening Saturday May 12th !
Then and now…
24 Schooley’s Mt. Road
Long Valley, NJ 07853
908-876-5525
28
5% Stock Dividend !!!
29
$0.04 per quarter
33% Increase!!!
Cash Dividend
30
Stock Price
Stock
-
SOMH
Declared 5%
Stock Dividend
(
5/15/2002
)
12/31/2002
$6.46
3/31/2003
6.13
Declared 5% Stock Dividend
6/30/2003
7.52
9/30/2003
7.88
12/31/2003
10.17
3/31/2004
11.06
Declared 5% Stock Dividend
6/30/2004
10.87
9/30/2004
10.73
12/31/2004
11.51
*Prices Adjusted to reflect 5% Stock Dividend of 5/15/2002, 6/30/2003, 6/2/2004, 6/30/2005 and
5/31/2006
31
Stock Price (continued)
Stock
-
SOMH
3/31/2005
$10.29
Declared 5% Stock Dividend and $0.02 Cash Dividend
6/30/2005
10.95
9/30/2005
1
0.71
Declared
$0.02 Cash Dividend
12/31/2005
1
1.95
Declared $0.02 Cash Dividend
3/31/2006
1
3.64
Decl
ared 5% Stock Dividend and $0.03
Cash Dividend
*Prices Adjusted to reflect 5% Stock Dividend of 5/15/2002, 6/30/2003, 6/2/2004, 6/30/2005 and
5/31/2006
32
Stock Price (continued)
Stock
-
SOMH
6/30/2006 13.16
Declared $0.03 Cash Dividend
9/30/2006 12.20
Declared $0.03 Cash Dividend
12/31/2006
13.22
Declared $0.03 Cash Dividend
3/31/2007 14.34
*Prices Adjusted to reflect 5% Stock Dividend of 5/15/2002, 6/30/2003, 6/2/2004, 6/30/2005 and
5/31/2006
33
