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CENTRAL BANCORP, INC.
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[CENTRAL BANCORP LETTERHEAD]
Contact: William P. Morrissey
Senior Vice President For Release: Immediately
(617) 628-4000
INSTITUTIONAL SHAREHOLDER SERVICES
RECOMMENDS A VOTE FOR BOARD'S NOMINEES
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IN CENTRAL BANCORP, INC. PROXY CONTEST
Somerville, Massachusetts (September 20, 2002) - Institutional Shareholder
Services, Inc. (ISS), widely recognized as the leading independent proxy
advisory firm in the nation, has recommended a vote on the WHITE proxy card for
the nominees of the Board of Central Bancorp, Inc. (Nasdaq: CEBK), Marat
Santini, John Gilgun and Paul Bulman, in opposition to the nominees of the PL
Capital Group. Central Bancorp's Annual Meeting of Stockholders is scheduled for
Monday, September 30, 2002.
In its recommendation, ISS said "Management has a business plan that has
provided shareholders with significant returns over the last five years. The
management slate of nominees has expertise and a knowledge base of the
community, which can assist the company's implementation of its business plan."
In analyzing the issues, ISS considered the Company's performance and
stated:
"A major issue raised by the dissidents is the Company's ability to
survive in a competitive landscape. However, the Company's overall
performance especially over the last year seems to refute these claims.
Despite an economic downturn over the last two years, shareholders have not
suffered but have in fact thrived under the incumbent board leadership.
Therefore, it is difficult to maintain that the company cannot sustain
itself."
* * * *
"What is not in dispute is the Company's stock performance over the
last five years. The Company outperformed its industry peer group with an
annualized return of 12.35 percent versus 9.02 percent. More significant is
the Company's stock performance over the last year. The Company's return of
31.09
percent is double the return of the industry peers of 15 percent. This
sustained performance weakens the dissident's claims that the company would
have difficulty thriving in the intensely competitive Massachusetts banking
environment. Moreover, the Company's success over the last quarter further
bolsters management's arguments."
In discussing the Company's business plan, ISS stated:
"In summary, the board acknowledges the difficulties that small
community banks have when faced with larger more leveraged institutions.
However, management has taken steps intended to take advantage of these
market conditions to create a special niche market for the Bank. It appears
that the implementation of this plan has benefited shareholders and
provided the foundation for the Company's current success."
With regard to the qualifications of the nominees:
"Thus, the management candidates can assist the Company in the
execution of its business plan. Since the Company hopes to thrive within
this niche market, it is essential that the Company have board members that
understand the community in which they are serving."
John D. Doherty, President and Chief Executive Officer of Central Bancorp,
Inc. commented: "We are very pleased that ISS supports the Board's nominees. The
ISS recommendation reaffirms our belief that the Board's nominees are the more
qualified nominees for director. More importantly, however, ISS provides a
source for all stockholders, both big and small, who are looking for the
judgment of a neutral party, well experienced in these issues, to guide their
vote."
Stockholders who like additional information on voting should call
Georgeson Shareholder Services Inc. at (866) 367-5518.
Central Bancorp, Inc., is the holding company for Central Bank, whose legal
name is Central Co-operative Bank, a Massachusetts-chartered co-operative bank
operating eight full-service banking offices in suburban Boston.