[GRAPHIC]
---PROSPERITY---
BANCSHARES, INC.
PRESS RELEASE For more information contact:
David Hollaway
PROSPERITY BANCSHARES, INC.(SM) Chief Financial Officer
4295 San Felipe 979.543.2200
Houston, Texas 77027 davidhollaway@prosperitybanktx.com
Dan Rollins
Senior Vice President
713.693.9300
danrollins@prosperitybanktx.com
FOR IMMEDIATE RELEASE
PROSPERITY BANCSHARES, INC.(SM)
COMPLETES ACQUISITION OF
TEXAS GUARANTY BANK
HOUSTON BANK HOLDING COMPANY ADDS WEST HOUSTON LOCATIONS
HOUSTON, May 9, 2002. Prosperity Bancshares, Inc. (Nasdaq: PRSP) announced today
that it has completed the acquisition of Texas Guaranty Bank, N.A. The three
offices of Texas Guaranty Bank will be operated as full service banking centers
of Prosperity Bank.
Prosperity Bank's West Houston Banking Centers (former Texas Guaranty Bank
locations) will be managed by Frank Maresca, Banking Center President - West
Houston Banking Centers; Andy Dow, Executive Vice President; Jackie Calhoun,
Executive Vice President; Steve Jones, Senior Vice President and Don Mach,
Senior Vice President. Other new Prosperity Bank officers include Dona Black,
Vice President; Fred Hester, Vice President; Wilmer Klopsteck, Vice President;
Glenda Mayo, Vice President
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and Lobby Manager of the Memorial Banking Center; Stephanie Ford, Assistant Vice
President; Jacque Williams, Assistant Vice President; Terry Calhoun, Banking
Center Officer; Nancy Ikner, Banking Center Officer; Mary Jo Gibson, Banking
Center Officer and Lobby Manager of the Highway 6 Banking Center; and John Mick,
Accounting Officer.
"We are very pleased to have this management team join our organization,"
remarked David Zalman, Chairman of the Board and Chief Executive Officer of
Prosperity Bank. "The years of banking experience represented by this group of
officers will be an asset for our bank and will allow us to continue to grow our
customer base in Houston."
The acquisition of Texas Guaranty Bank was announced on February 22, 2002,
whereby Prosperity would acquire Texas Guaranty from American Bancorp of
Oklahoma, Inc. for $11.8 million in cash.
"The integration of our three new locations into our operations is progressing
on schedule. We anticipate completing the data processing conversion along with
the installation of new signage in early June," added H. E. "Tim" Timanus, Jr.,
President and Chief Operating Officer of Prosperity Bank (SM)
Texas Guaranty Bank, N.A. had total assets of $73.5 million, total deposits of
$62.4 million and total loans of $45.6 million on May 7, 2002.
"Our customers will continue to enjoy the same type of people to people banking
they have enjoyed with Texas Guaranty Bank," said Frank Maresca. "We are
committed to the communities we serve and with thirty-two full service banking
centers, our customers will be able to take advantage of our expanding presence
in Houston."
ACQUISITION OF PARADIGM BANK TEXAS
On May 2, 2002, Prosperity Bancshares, Inc. and Paradigm Bancorporation, Inc.,
Houston, Texas (Paradigm) announced that they had signed a definitive agreement
pursuant to which Paradigm will be merged into Prosperity. The transaction
solidifies Prosperity's presence in the greater Houston metropolitan market, and
is a logical extension of Prosperity's geographic franchise across Southeast
Texas. Under terms of the agreement, Prosperity will issue approximately 1.29
million shares of its common stock (2.58 million shares after the 2-for-1 split
is completed) for all outstanding shares of Paradigm.
Paradigm is privately held and is the bank holding company of Paradigm Bank
Texas, which operates a total of eleven (11) banking offices - six (6) in
metropolitan Houston and five (5) in the nearby Southeast Texas cities of
Dayton, Galveston, Mont Belvieu, and Winnie. As of December 31, 2001, Paradigm
had total assets of $259.3 million, loans of $170.8 million, deposits of $232.4
million and shareholders' equity of $18.1 million.
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The merger, which is expected to be tax-free to Paradigm shareholders, has been
approved by the Board of Directors of both companies. The transaction is
expected to close before September 30, 2002 and is subject to approval by
Paradigm shareholders, as well as customary regulatory approvals. Operational
integration is anticipated to begin during the fourth quarter of 2002.
Following the merger, Prosperity will have forty (40) banking centers in Houston
and the fifteen (15) surrounding counties with over $1.4 billion in deposits,
approximately $650 million in loans and over $1.6 billion in assets. With the
addition of Paradigm's loans, Prosperity's loan to deposit ratio will increase
from 36.8 percent to approximately 46 percent.
ACQUISITION OF THE FIRST STATE BANK
On April 26, 2002, Prosperity announced the signing of a definitive agreement to
acquire The First State Bank, Needville Texas in a cash transaction. The
proposed transaction is subject to certain conditions and approval by
regulators.
The First State Bank operates one (1) office in Needville, Texas, which will be
consolidated (upon completion of the transaction) with Prosperity Bank's full
service banking center in Needville. On December 31, 2001, The First State Bank
reported total assets of $17.8 million, total deposits of $15.4 million and
total loans of $4.9 million.
STOCK SPLIT AND DIVIDEND ANNOUNCEMENT
On May 8, 2002, Prosperity Bancshares, Inc. announced a two-for-one stock split
to be effected in the form of a 100 percent stock dividend to shareholders of
record on May 20, 2002 and payable on May 31, 2002.
Prosperity is paying this two-for-one stock split effected in the form of a 100
percent stock dividend to reward the shareholders for the continued growth and
profitability of the company. Prosperity currently has approximately 8.1 million
shares of Common Stock outstanding, which will increase to approximately 16.2
million shares after the stock split.
In addition, the Board of Directors of Prosperity Bancshares, Inc.(SM), has
declared a quarterly cash dividend of $0.055 per share payable on July1, 2002 to
all shareholders of record as of June 14, 2002.
Prosperity Bancshares, Inc.(SM), formed in 1983, is a $1.290 billion bank
holding company headquartered in Houston, Texas. Operating under a community
banking philosophy, Prosperity seeks to develop broad customer relationships
based on service and convenience. Prosperity offers a variety of traditional
loan and deposit products to its customers, which consist primarily of consumers
and small and medium sized businesses. In addition to established banking
products, Prosperity offers a complete line of services including: Internet
Banking services at www.prosperitybanktx.com, Trust and Investment Services,
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MasterMoney Debit Cards, and 24 hour voice response banking. The bank currently
operates thirty-two (32) full service banking locations in fourteen (14)
contiguous counties including the Greater Houston Metropolitan Area. (Angleton,
Bay City, Beeville, Clear Lake, Cleveland, Cuero, Cypress, East Bernard, Edna,
El Campo, Fairfield, Goliad, Hitchcock, Houston - Bellaire, Houston - CityWest,
Houston -Downtown, Houston - Highway 6 West, Houston - Medical Center, Houston -
Memorial, Houston - Post Oak, Houston - River Oaks, Houston - Tanglewood,
Houston - Waugh Drive, Liberty, Magnolia, Mathis, Needville, Palacios, Sweeny,
Victoria, West Columbia, and Wharton.)
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995: THE STATEMENTS CONTAINED IN THIS RELEASE WHICH ARE NOT HISTORICAL FACTS
CONTAIN FORWARD-LOOKING INFORMATION WITH RESPECT TO PLANS, PROJECTIONS OR FUTURE
PERFORMANCE OF PROSPERITY BANCSHARES, INC.(SM) AND ITS SUBSIDIARIES. FORWARD-
LOOKING STATEMENTS, WITHIN THE MEANING OF SECTION 21E OF THE SECURITIES EXCHANGE
ACT OF 1934, MAY HAVE BEEN MADE IN THIS DOCUMENT. PROSPERITY'S RESULTS MAY
DIFFER MATERIALLY FROM THOSE IN THE FORWARD-LOOKING STATEMENTS FOR A VARIETY OF
REASONS, INCLUDING ACTIONS OF COMPETITORS; CHANGES IN LAWS AND REGULATIONS
(INCLUDING CHANGES IN GOVERNMENTAL INTERPRETATIONS OF REGULATIONS AND CHANGES IN
ACCOUNTING STANDARDS); CUSTOMER AND CONSUMER DEMAND, INCLUDING CUSTOMER AND
CONSUMER RESPONSE TO MARKETING; EFFECTIVENESS OF SPENDING, INVESTMENTS OR
PROGRAMS; FLUCTUATIONS IN THE COST AND AVAILABILITY OF SUPPLY CHAINRESOURCES;
ECONOMIC CONDITIONS, INCLUDING CURRENCY RATE FLUCTUATIONS; AND WEATHER. THESE
FACTORS ARE MORE FULLY DESCRIBED IN PROSPERITY BANCSHARES, INC.'S FILINGS WITH
THE SECURITIES AND EXCHANGE COMMISSION.
IN CONNECTION WITH THE PROPOSED MERGER OF PARADIGM INTO PROSPERITY, PROSPERITY
WILL FILE A PROXY STATEMENT/PROSPECTUS WITH THE SECURITIES AND EXCHANGE
COMMISSION.INVESTORS AND SECRUITYHOLDERS ARE ADVISED TO READ THE PROXY
STATEMENT/PROSPECTUS WHEN IT BECOMES AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION. INVESTORS AND SECURITY HOLDERS MAY OBTAIN A FREE COPY OF THE PROXY
STATEMENT/PROSPECTUS (WHEN AVAILABLE) AND OTHER DOCUMENTS FILED BY PROSPERITY
WITH THE SECURITIES AND EXCHANGE COMMISSION AT ITS WEBSITE, HTTP://WWW.SEC.GOV.
FREE COPIES OF THE PROXY STATEMENT/PROSPECTUS, ONCE AVAILABLE, AND PROSPERITY'S
OTHER FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION MAY ALSO BE OBTAINED
FROM PROSPERITY BY CONTACTING INVESTOR RELATIONS AT (713) 693-9300.
COPIES OF PROSPERITY BANCSHARES, INC.'S(SM) SEC FILINGS MAY BE DOWNLOADED FROM
THE INTERNET AT NO CHARGE FROM FREEEDGAR, A REAL-TIME ACCESS TO SEC FILINGS SITE
LOCATED AT WWW.FREEEDGAR.COM.
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