2009 Annual Shareholders Meeting
February 11, 2009
Forward Looking Statements
This presentation contains statements about future events that constitute forward-
looking statements within the meaning of the Section 27A of the Securities Act of 1933
and Section 21E of the Securities Exchange Act of 1934. Such forward-looking
statements may be identified by reference to a future period or periods, or by the use of
forward- looking terminology, such as “may,” “will,” “believe,” “expect,” or similar terms
or variations on those terms, or the negative of those terms. Forward-looking statements
are subject to numerous risks and uncertainties, including, but not limited to, those
risks previously disclosed in the Company’s filings with the SEC, general economic
conditions, changes in interest rates, regulatory considerations, competition,
technological developments, retention and recruitment of qualified personnel, and
market acceptance of the Company’s pricing, products and services, and with respect to
the loans extended by the Bank and real estate owned, the following: risks related to the
economic environment in the market areas in which the Bank operates, particularly with
respect to the real estate market in New Jersey; the risk that the value of the real estate
securing these loans may decline in value; and the risk that significant expense may be
incurred by the Company in connection with the resolution of these loans. The Company
wishes to caution readers not to place undue reliance on any such forward-looking
statements, which speak only as of the date made. The Company does not undertake
and specifically declines any obligation to publicly release the result of any revisions that
may be made to any forward-looking statements to reflect events or circumstances after
the date of such statements or to reflect the occurrence of anticipated or
unanticipated events.
2
Magyar Bancorp Overview
Founded in 1922
January 23, 2006 – Magyar Bancorp completed its
reorganization into the Mutual Holding Company form
On such date, Magyar Bancorp completed its Initial Public
Offering, raising $26.2 million. It currently has 45.7% of its
outstanding shares owned by public shareholders, including
MagyarBank Charitable Foundation. The remainder is owned
by Magyar Bancorp, MHC
Magyar operates five branch locations throughout Middlesex
and Somerset Counties in New Brunswick (2), North
Brunswick, South Brunswick and Branchburg
Magyar Bancorp trades on the NASDAQ Global Market under
the symbol MGYR
3
Magyar Bank Branch Locations
4
Branchburg
1000 Route 202 South
New Brunswick
(Corporate Headquarters)
400 Somerset Street
North Brunswick
582 Milltown Road
South Brunswick
3050 Highway 27
Existing Locations
New Brunswick
(Inside Child Health Institute)
93 French Street
2008 Year in Review
5
Impact of Economic Downturn on
Magyar Bancorp
Depreciation of collateral values securing
construction loans resulted in loan write downs
and additional loan loss provisions
Several large commercial and construction loans
moved into non-performing status
Increased loan loss provisions resulted in net loss
for Fiscal Year 2008 and Fiscal First Quarter 2009
6
New Jersey Housing Market
7
County
3Q07
Median
Sales
Price
3Q08
Median
Sales
Price
%
Change
Homes
Sold
3Q07
Homes
Sold
3Q08
%
Change
Middlesex
$385,100
$375,600
-2.5%
1,499
1,203
-19.7%
Somerset
$508,400
$456,900
-10.1%
814
731
-10.2%
Source: New Jersey Association of Realtors
3rd Qtr. NJ Home Sales Report
Impact of Economic Downturn on
Magyar Bancorp
Residential mortgage portfolio – defined as 1-4
family closed end loans
90+ day delinquency rate as of 12/31/08: 0.91%
90+ day delinquency rate as of 12/31/07: 0.39%
8
2008 Financial Summary
9
Asset Growth
10
Assets grew 8.7% in 2008
Deposit Growth
$223,974
$278,090
$325,602
$368,777
$375,560
11
$384,908
Deposits grew 1.8% in 2008
Growth in Non-Interest & Interest
Bearing Checking
12
$34,473
$42,715
$51,010
$53,672
$57,682
Non-Interest & Interest Bearing Checking grew 13.4% in 2008
Loan Portfolio Growth
$195,910
$277,026
$352,353
$385,582
$410,651
13
$425,812
Loans grew 6.5% in 2008
Non-Performing Assets
14
$247
$1,040
$7,400
$10,286
$24,734
$27,720
Asset Quality
15
16
Maintained Net Interest Margin in 2008
Quarterly Earnings Per Share
17
12/31/06 3/31/07 6/30/07 9/30/07 12/31/07 3/31/08 6/30/08 9/30/08 12/31/08
9/30/08 - $3.3 million loan loss provision
12/31/08 - $4.0 million loan loss provision
Stock Price Performance
18
19
MGYR Stock Price & Volume Chart
Price on
2/6/09
$3.50
20
Market Trends
As of February 6, 2009
-67.50
-15.73
-37.34
-34.75
-48.07
-13.07
-5.79
-15.11
-4.01
-21.37
-14.13
-14.01
-10.98
-57.32
-75%
-60%
-45%
-30%
-15%
0%
MGYR
SNL Thrift
MHCs
NJ MHCs
Mid-Atlantic
MHCs
SNL Thrifts
Nasdaq Bank
S&P 500
Change LTM
Change Three Month
21
MGYR vs. MHCs
As of February 6, 2009
NM – Not Measureable
MGYR
Average
Median
Average
Median
Price
$3.50
Price/Earnings
NM
28.2x
24.5x
27.6x
27.7x
Price/LTM EPS
NM
31.7x
27.7x
33.5x
28.1x
Price/Book
47.0%
107.6%
98.6%
118.3%
121.8%
Price/Tang Book
47.0%
117.3%
104.8%
131.7%
134.2%
Nationwide MHCs
NJ MHCs
Stock Buyback Update
5% Buyback of 130,927 shares, announced
April 2007
Completed November 2007
Second 5% Buyback of 129,924 shares
announced November 2007
63,770 shares purchased through December 31,
2008
22
Capital Adequacy
23
As of December 31, 2008
Magyar Continues to be an Active
Leader in the Community
24
Community Involvement
25
HARP – Housing Assistance Recovery Program
Pilot program developed by Magyar Bank and First
Baptist Community Development Corporation (CDC),
Somerset, NJ
2008 Chris Kjeldsen Award
Presented by the Middlesex County Chamber of
Commerce
2008 Improving Financial Literacy Award
Presented by America’s Community Bankers
2008 Community Service Award
Presented by the NJ League of Community Bankers
MagyarBank Charitable Foundation made $92,000 of
grants in 2008
2009 Strategic Initiatives
26
Looking Ahead to 2009
Reduce non-performing assets
Reduce exposure to construction loans
Focus on residential and commercial lending
opportunities with a conservative underwriting approach
Gain deposit market share from dissatisfied customers
of national and regional banks and brokerage houses
Continue our commitment to support the local
community
27
Enhance shareholder value by positioning the Company
to take advantage of the eventual economic recovery
Any Questions?
28
