PRESS RELEASE
THE PROVIDENT BANK
Contact:
Kenneth J. Wagner
Investor Relations
Provident Financial Services, Inc.
830 Bergen Avenue
Jersey City, NJ 07306
201-915-5344
For Immediate Release: 5:00 pm EST, October 30, 2003
Provident Financial Services, Inc. Announces Quarterly Earnings;
Declares Quarterly Cash Dividend
JERSEY CITY, NJ, October 30, 2003 - Provident Financial Services, Inc.
(NYSE:PFS) the holding company for The Provident Bank reported net income of
$8.1 million for the quarter ended September 30, 2003, an increase of $4.5
million or 122.90% compared to net income of $3.7 million for the quarter ended
September 30, 2002. Results for the quarter ended September 30, 2002 were
adversely impacted by a $11.1 million charge to operations for the provision for
loan losses resulting from a loan charge-off relating to a mortgage warehouse
loan. For the nine months ended September 30, 2003, Provident Financial Services
reported net income of $10.5 million, a decrease of $8.1 million or 43.60%
compared to net income of $18.7 million for the nine months ended September 30,
2002. This reduction in net income for the nine months ended September 30, 2003
is due primarily to the one-time expense associated with the $15.6 million
contribution net of tax to The Provident Bank Foundation. Provident Financial
Services reported basic and diluted earnings per share of $0.14 for the quarter
ended September 30, 2003 and basic and diluted earnings per share of $0.16 for
nine months ended September 30, 2003, which includes the results of operations
from January 15, 2003.
"Our third quarter results were challenged by the current low interest-rate
environment and the associated net interest margin compression due to prepayment
activity associated with mortgage related assets," said Paul M. Pantozzi,
Chairman of the Board, Chief Executive Officer and President of Provident
Financial Services, Inc. and The Provident Bank. Pantozzi added that "Consistent
with our strategy to expand our franchise, during the third quarter we acquired
three branch offices located in Howell, Jackson, and Rocky Hill, NJ from another
bank, and in early October we opened in North Brunswick our second de novo
branch this year.
During the third quarter, management conducted a strategic review of all
business lines and their alignment with our business strategy of building and
expanding customer relationships. After this review management determined that
mortgage warehouse lending did not meet our core business product criteria, and
a decision was made to de-emphasize the mortgage warehouse business. Consistent
with that decision, The Provident Bank has entered into an agreement to sell
substantially all of its mortgage warehouse lines of credit to Independence
Community Bank. The transaction is expected to be completed in November, 2003.
DECLARATION OF QUARTERLY DIVIDEND
On October 29, 2003 the Board of Directors declared a quarterly cash dividend of
$0.05 per common share. The dividend is payable on November 28, 2003 to
stockholders of record as of the close of business on November 14, 2003.
COMPARISON OF OPERATING RESULTS
Total net interest income increased $1.8 million or 6.14% to $30.7 million for
the quarter ended September 30, 2003 compared to $29.0 million for the quarter
ended September 30, 2002. Interest income for the third quarter of 2003
decreased $1.1 million or 2.54% to $43.9 million compared to $45.0 million for
the comparable quarter in 2002. As a result of the current low interest rate
environment, Provident Financial Services experienced accelerated premium
amortization expense in the mortgage-backed securities portfolio related to
prepayments in the underlying securities. Premium amortization expense in the
amount of $3.7 million for the three months ended September 30, 2003 has been
recorded as an adjustment to yield. Interest expense decreased $2.9 million or
18.22% to $13.1 million for the quarter ended September 30, 2003 compared to
$16.0 million for the quarter ended September 30, 2002.
The average balance of investment securities held to maturity and securities
available for sale increased $798.9 million or 93.52% to $1.65 billion for the
quarter ended September 30, 2003 compared to $854.3 million for the comparable
period in 2002. This increase is primarily due to the investment of proceeds
from the conversion of The Provident Bank from a mutual to stock savings bank, a
leverage strategy implemented in the fourth quarter of 2002 and completed early
in the second quarter of this year and the reinvestment of cash from loan
prepayments and refinance activity due to the current low interest rate
environment. The average balance of net loans increased $77.1 million or 3.98%
to $2.017 billion for the quarter ended September 30, 2003 compared to $1.94
billion for the comparable quarter in 2002. The average yield on interest
earning assets decreased 168 basis points to 4.49% for the quarter ended
September 30, 2003 compared to 6.17% for the comparable quarter in 2002,
primarily due to the reinvestment of cash from loan and mortgage-backed
securities prepayments in lower yielding loans and investments, as well as rate
modifications in the commercial real estate portfolio.
Average core deposit account balances increased $247.4 million or 17.03% to
$1.70 billion at September 30, 2003 compared to $1.453 billion at September 30,
2002. Core deposit accounts consist of all demand deposit and savings accounts.
Average time deposit balances decreased $107.3 million or 9.91% to $974.9
million for the quarter ended September 30, 2003 compared to $1.1 billion for
the comparable quarter in 2002. Average borrowings increased $403.5 million or
192.81% to $612.8 million for the quarter ended September 30, 2003 compared to
$209.3 million for the quarter ended September 30, 2002. The average cost of
interest bearing liabilities decreased 81 basis points to 1.76% for the quarter
ended September 30, 2003 compared to 2.57% for the quarter ended September 30,
2002. The decrease in the average cost of interest-bearing liabilities can be
attributed to the decrease in core deposit account rates and the continued
decrease in rates on time deposits.
Net interest margin decreased 82 basis points to 3.15% for the quarter ended
September 30, 2003 compared to 3.97% for the quarter ended September 30, 2002,
and the net interest margin decreased 70 basis points to 3.33% compared to 4.03%
for the nine months ended September 30, 2002. The interest rate spread decreased
86 basis points to 2.73% for the quarter ended September 30, 2003 compared to
3.59% for the comparable quarter in 2002, and the interest rate spread decreased
82 basis points to 2.84% from 3.66% for the nine months ended September 30,
2002. Compared to the trailing quarter, net interest margin decreased 26 basis
points to 3.15% and interest rate spread decreased 20 basis points to 2.73%. Net
interest margin and net interest spread have narrowed as a result of the current
low interest rate environment and the reinvestment of cash from prepayments of
loans and investments related to refinance activity at lower current interest
rates.
Non-interest income increased $1.0 million or 17.39% to $6.8 million for the
quarter ended September 30, 2003 compared to $5.8 million for the comparable
period in 2002. This increase is attributable to an increase of $700,000 in fee
income, and a $664,000 increase in gains on securities sales, and is partially
offset by a $362,000 decrease in other income. For the nine months ended
September 30, 2003, non-interest income decreased $335,000 or 1.89% to $17.4
million compared to $17.7 million at September 30, 2002. For the nine months
ended September 30, 2003, fees on retail accounts increased $935,000 or 8.42% to
$12.0 million compared to $11.1 million for the nine months ended September 30,
2002. Other income decreased $918,000 or 35.83% to $1.6 million at September 30,
2003 compared to $2.6 million at September 30, 2002. For the nine months ended
September 30, 2003, net profit on the sale of loans decreased $720,000 or 45.13%
to $877,000 compared to $1.6 million in the comparable period in 2002. For the
nine months ended September 30, 2003, net gains on the sale of other assets
decreased $320,000 or 65.60% to $168,000 compared to $488,000 for the comparable
period in 2002. For the quarter ended September 30, 2002, a $240,000 gain
associated with the sale of bank-owned property was recorded.
Non-interest expense increased $4.7 million or 22.55% to $25.7 million for the
quarter ended September 30, 2003 compared to $21.0 million for the quarter ended
September 30, 2002. For the nine months ended September 30, 2003, non-interest
expense increased $32.3 million or 49.28% to $97.9 million compared to $65.6
million for the nine months ended September 30, 2002. The increase in
non-interest expense for the nine months ended September 30, 2003 is primarily
due to the one-time expense associated with the $24 million contribution to The
Provident Bank Foundation that was recorded in the first quarter of 2003. Salary
and benefit expense increased $2.8 million or 24.61% to $14.2 million for the
three months ended September 30, 2003 compared to $11.4 million for the three
months ended September 30, 2002. For the nine months ended September 30, 2003
salary and benefit expense increased $4.3 million or 12.30% to $38.8 million
compared to $34.5 million on September 30, 2002 The increase in salary and
benefit expense is primarily attributable to benefit expenses related to new
stock-related benefit plans: the employee stock ownership plan in the amount of
$2.0 million, the stock award plan in the amount of $639,000 and stock option
plan in the amount of $768,000. In the quarter ended September 30, 2003, we
adopted the fair value based method, SFAS No. 123 "Accounting for Stock Based
Compensation" to recognize compensation expense on all outstanding stock option
awards from the time of grant. Other operating expenses increased $719,000 or
20.93% to $4.2 million for the quarter ended September 30, 2003 compared to $3.4
million for the comparable quarter in 2002. For the nine months ended September
30, 2003, other operating expenses increased $2.1 million or 18.24% to $13.8
million compared to $11.6 million on September 30, 2002. This increase is
primarily due to an increase of $1.2 million or 211.76% in insurance premiums
and $508,000 or 20.41% in amortization of intangible assets.
The provision for loan losses for the three months ended September 30, 2003 was
$160,000, a decrease of $10.9 million compared to $11.1 million for the three
months ended September 30, 2002. For the nine months ended September 30, 2003,
the provision for loan losses was $1.1 million compared to $12.3 million in
2002. This decrease is related to an $11.8 million charge to the allowance for
loan losses recognized in the third quarter of 2002 related to a non-performing
mortgage warehouse loan. The allowance for loan losses was $21.3 million or
1.01% of total loans at September 30, 2003 compared to $21.3 million or 1.07% of
total loans at September 30, 2002 and $21.0 million or 1.02% of total loans at
December 31, 2002. At September 30, 2003, the allowance for loan losses as a
percentage of non-performing loans increased to 364.02% from 167.37% at
September 30, 2002 and increased from 246.55% at December 31, 2002.
COMPARISON OF FINANCIAL CONDITION
Total assets at September 30, 2003 increased $252.0 million or 6.43% to $4.2
billion compared to $3.9 billion at December 31, 2002.
Total loans at September 30, 2003 increased $60.8 million or 2.96% to $2.11
billion compared to $2.05 billion at December 31, 2002. Residential mortgage
loans increased $125.9 million or 18.00% to $825.4 million for the nine months
ended September 30, 2003 compared to $699.5 million at December 31, 2002.
Residential mortgage loan originations totaled $297.3 million and one-to-four
family loans purchased totaled $144.1 million at September 30, 2003. Residential
loan payoffs totaled $277.1 million, excluding scheduled amortization, and loans
sold totaled $3.0 million at September 30, 2003. Commercial real estate loans
decreased $2.6 million or 0.60% to $435.0 million at September 30, 2003 compared
to $437.7 million at December 31, 2002. Multi-family loans decreased $1.9
million to $75.2 million at September 30, 2003 compared to $77.0 million at
December 31, 2002. Construction loans decreased $20.8 million or 21.65% to $75.2
million at September 30, 2003 compared to $96.0 million at December 31, 2002.
Commercial loans increased $21.1 million or 11.12% to $211.1 million at
September 30, 2003 compared to $190.0 million at December 31, 2002. Mortgage
warehouse loans decreased $61.1 million or 22.10% to $215.3 million at September
30, 2003 compared to $276.4 million at December 31, 2002, consistent with the
strategic decision to de-emphasize this line of business. Consumer loans
decreased $732,000 or 0.27% to $275.1 million at September 30, 2003 compared to
$275.8 million at December 31, 2002. Retail loans, which consist of one to four
family residential mortgages and consumer loans, such as fixed-rate home equity
loans and lines of credit, totaled $1.1 billion and accounted for 52.13% of the
loan portfolio at September 30, 2003 compared to $975.3 million or 47.53% of the
portfolio at December 31, 2002. Commercial loans, consisting of commercial real
estate, multi-family, construction, mortgage warehouse and commercial loans,
totaled $1.0 billion, accounting for 47.87% of the loan portfolio at September
30, 2003 compared to $1.1 billion or 52.47% at December 31, 2002.
Investment securities held to maturity increased $285.5 million or 132.12% to
$501.6 million at September 30, 2003, compared to $216.1 million at December 31,
2002. The increase in investment securities held to maturity was the result of a
leverage strategy that was completed in the second quarter of 2003. Securities
available for sale decreased $105.5 million or 8.49% to $1.1 billion at
September 30, 2003 compared to $1.2 billion at December 31, 2002.
Bank-owned life insurance increased $22.8 million or 47.87% to $70.5 million at
September 30, 2003 compared to $47.7 million at December 31, 2002. This increase
was due primarily to an additional $20.0 million purchase of bank-owned life
insurance in the first quarter of 2003 and increases in the cash surrender
value.
Total non-performing loans totaled $5.8 million at September 30, 2003 compared
to $8.5 million at December 31, 2002 and $12.8 million at September 30, 2002.
Total non-performing loans as a percentage of total loans were 0.28% at
September 30, 2003 compared to 0.41% at December 31, 2002 and 0.62% at September
30, 2002. The allowance for loan losses as a percentage of non-performing loans
was 364.02% compared to 246.55% at December 31, 2002 and 166.94% at September
30, 2002. The allowance for loan losses as a percentage of total loans was 1.01%
at September 30, 2003 compared to 1.02% at December 31, 2002 and 1.07% at
September 30, 2002.
Total deposits decreased $553.5 million or 17.06% to $2.7 billion at September
30, 2003 from $3.2 billion at December 31, 2002. The largest decrease was in
demand deposit accounts, which decreased $526.0 million to $743.5 million at
September 30, 2003 from $1.3 billion at December 31, 2002. This decrease is
primarily attributable to the funds held in the conversion escrow account
totaling $526.0 million that were held for the purchase of shares of Provident
Financial Services, Inc. common stock. Savings deposits increased $60.4 million
or 6.55% to $982.8 million at September 30, 2003 compared to $922.4 million at
December 31, 2002. Compared to the trailing quarter, core deposits increased
$46.1 million or 2.7%, core deposits at September 30, 2003 represented 64.2% of
total deposits compared to 62.9% at June 30, 2003. Time deposits decreased $88.0
million or 8.37% to $963.5 million at September 30, 2003 from $1.05 billion at
December 31, 2002.
Total borrowed funds increased $290.5 million or 89.91% to $613.6 million at
September 30, 2003 from $323.1 million at December 31, 2002. Federal Home Loan
Bank borrowings increased $398.0 million or 244.24% to $560.9 million at
September 30, 2003 compared to $267.1 million at December 31, 2002. The increase
in borrowed funds was due primarily to a leverage strategy.
The Provident Bank maintains its corporate offices in Jersey City, New Jersey.
The Provident Bank currently operates 54 full service branches throughout
northern and central New Jersey.
Forward-looking Statements
Certain statements contained herein are "forward-looking statements" within the
meaning of 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,"
"estimate," "anticipate," "continue," 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 related
to the economic environment, particularly in the market areas in which the
Company operates, competitive products and pricing, fiscal and monetary policies
of the U.S. Government, changes in government regulations affecting financial
institutions, including regulatory fees and capital requirements, changes in
prevailing interest rates, acquisitions and the integration of acquired
businesses, credit risk management, asset-liability management, the financial
and securities markets and the availability of and costs associated with sources
of liquidity.
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
wishes to advise readers that the factors listed above could affect the
Company's financial performance and could cause the Company's actual results for
future periods to differ materially from any opinions or statements expressed
with respect to future periods in any current statements. The Company does not
undertake and specifically declines any obligation to publicly release the
result of any revisions which 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.
PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Consolidated Statements of Condition
September 30, 2003 (Unaudited) and December 31, 2002
(Dollars in Thousands)
Assets September 30, 2003 December 31, 2002
----------------------------- -----------------------
Cash and due from banks $ 100,123 101,352
Federal funds sold 93,000 73,000
Short-term investments 35,672 90,503
----------------------------- -----------------------
Total cash and cash equivalents 228,795 264,855
----------------------------- -----------------------
Investment securities (market value of $510,776 501,647 216,119
(unaudited) and $221,435 at September 30, 2003
and December 31, 2002)
Securities available for sale, at fair value 1,136,623 1,242,118
Federal Home Loan Bank stock 28,047 13,356
Loans 2,113,697 2,052,855
Less allowance for loan losses 21,288 20,986
----------------------------- -----------------------
Net loans 2,092,409 2,031,869
----------------------------- -----------------------
Other real estate owned, net 41 --
Banking premises and equipment, net 46,637 44,005
Accrued interest receivable 16,481 15,842
Intangible assets 24,346 25,405
Bank-owned life insurance 70,472 47,659
Other assets 25,700 17,980
----------------------------- -----------------------
Total assets $ 4,171,198 3,919,208
============================= =======================
Liabilities and Equity
Deposits:
Demand deposits $ 743,520 1,269,421
Savings deposits 982,843 922,404
Certificates of deposit of $100,000 or more 155,185 160,867
Other time deposits 808,328 890,642
----------------------------- -----------------------
Total deposits 2,689,876 3,243,334
Mortgage escrow deposits 10,554 9,582
Borrowed funds 613,553 323,081
Other liabilities 23,446 17,202
----------------------------- -----------------------
Total liabilities 3,337,429 3,593,199
----------------------------- -----------------------
Stockholders' Equity:
Preferred stock, $0.01 par value,
50,000,000 shares authorized, none issued -- -- Common stock, $0.01 par value,
200,000,000 shares authorized, 61,538,300 shares issued and 61,477,700
outstanding at September 30, 2003 and 0 shares issued and outstanding at
December 31, 2002, respectively.
615
Additional paid-in capital 605,581
Retained earnings 319,113 314,111
Accumulated other comprehensive income 7,662 11,898
Less: Unallocated common stock held by the
employee stock ownership plan (73,473)
Less: Common stock acquired by the stock award plan (25,729)
----------------------------- -----------------------
----------------------------- -----------------------
Total stockholders' equity 833,769 326,009
----------------------------- -----------------------
Total liabilities and stockholders
Equity $ 4,171,198 3,919,208
============================= =======================
PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Consolidated Statements of Operations
Three Months and Nine Months Ended September 30, 2003 and 2002 (Unaudited)
(Dollars in Thousands, except per share data)
Three Months Ended Nine Months Ended
September 30 September 30
--------------------------------- --------------------------
2003 2002 2003 2002
--------------- ----------- ------------ -----------
Interest income:
Real estate secured loans $ 20,371 23,408 62,563 72,368
Commercial loans 5,608 4,778 16,666
13,052
Consumer loans 4,470 5,316 13,859 16,231
Investment securities 4,195 1,249 12,724 3,942
Securities available for sale 8,737 9,812 30,854 26,388
Other short-term investments 126 76 370 203
Federal funds 347 360 1,040 1,123
--------------- ----------- ------------ -----------
Total interest income 43,854 44,999 138,076 133,307
Interest expense:
Deposits 8,792 13,869 30,962 41,853
Borrowed funds 4,325 2,170 11,137 6,279
--------------- ----------- ------------ -----------
Total interest expense 13,117 16,039 42,099 48,132
Net interest income 30,737 28,960 95,977 85,175
Provision for loan losses 160 11,050 1,060 12,250
--------------- ----------- ------------ -----------
Net interest income after
provision for loan losses 30,577 17,910 94,917 72,925
Non-interest income:
Fees 4,333 3,633 12,043 11,108
Net gain on securities
transactions 665 1 661 960
Commissions 39 334 197 932
Bank-owned life insurance 1,019 726 2,813 2,131
Other income 695 1,057 1,644 2,562
--------------- ----------- ------------ -----------
Total non-interest income 6,751 5,751 17,358 17,693
Non-interest expense:
Salaries and employee benefits 14,151 11,356 38,797 34,546
Net occupancy expense 3,727 3,256 10,562 9,834
Federal deposit insurance 105 104 339 311
Data processing expense 1,666 1,500 4,939 4,523
Advertising and promotion expense 1,062 568 2,554 2,274
Amortization of intangibles 863 774 2,997 2,489
Other operating expenses 4,154 3,435 13,766 11,642
Contribution to The Provident Bank Foundation -- -- 24,000 --
--------------- ----------- ------------ -----------
Total non-interest expenses 25,728 20,993 97,954 65,619
Income before income tax expense
and the cumulative effect of a
change in accounting principle $ 11,600 2,668 14,321 24,999
Income tax expense (benefit) 3,462 (983) 3,788 5,803
--------------- ----------- ------------ -----------
Income before the cumulative effect
of a change in accounting principle 8,138 3,651 10,533 19,196
Cumulative effect of a change in accounting principle,
net of tax of $0 -- -- -- (519)
--------------- ----------- ------------ -----------
Net income $ 8,138 3,651 10,533 18,677
=============== =========== ============ ===========
Basic Earnings Per Share (1) $0.14 $0.16
Average basic shares outstanding 56,972,858 58,702,373
Diluted Earnings Per Share (1) $0.14 $0.16
Average diluted shares outstanding 57,174,970 58,774,166
PROVIDENT FINANACIAL SERVICES, INC. AND SUBSIDIARY
CONSOLIDATED FINANCIAL HIGHLIGHTS
(dollars in thousands, except share data)(unaudited)
For the For the
Three Months Ended Nine Months Ended
September 30 September 30
-------------------------------- -----------------------------------
2003 2002 2003 2002
---- ---- ---- ----
INCOME STATEMENT:
Net Interest Income (3) $ 30,737 28,960 $ 95,977 85,175
Provision for Loan Losses 160 11,050 1,060 12,250
Non-interest Income 6,751 5,751 17,358 17,693
Non-interest Expense 25,728 20,993 97,954 65,619
Income before income tax expense
and the cumulative effect of a
change in accounting principle 11,600 2,668 14,321 24,999
Cumulative effect of a change in
accounting principle --- --- --- (519)
Net Income 8,138 3,651 10,533 18,677
Basic Earnings Per Share (1) $0.14 --- $0.16 ---
Diluted Earnings Per Share (1) $0.14 --- $0.16 ---
Interest Rate Spread 2.73% 3.59% 2.84% 3.66%
Net Interest Margin 3.15% 3.97% 3.33% 4.03%
PROFITABILITY:
Return on average assets 0.78% 0.47% 0.34% 0.83%
Return on average equity 3.84% 4.65% 1.74% 8.29%
Operating expense to
average assets 2.47% 2.70% 3.20% 2.91%
Efficiency ratio (net of foundation expense) (2) 68.63% 60.48% 65.25% 63.79%
ASSET QUALITY:
Non-performing loans 5,848 12,786
Other Real Estate Owned 41 123
Non-performing loans to
total loans 0.28% 0.62%
Non-performing assets to
total assets 0.14% 0.33%
Allowance for loan losses 21,288 21,345
Allowance for loan losses to
non-performing loans 364.02% 166.94%
Allowance for loan losses to
total loans 1.01% 1.07%
AVERAGE BALANCE SHEET DATA:
Assets $4,167,851 $3,111,216 $4,085,849 $3,010,805
Loans, net $2,016,717 $1,939,584 $1,981,261 $1,932,947
Earnings assets $3,908,424 $2,916,851 $3,848,485 $2,816,727
Core deposits $1,700,013 $1,452,618 $1,674,773 $1,392,610
Borrowings $612,818 $209,290 $537,132 $197,293
Interest -bearing liabilities $2,977,902 $2,491,868 $2,886,430 $2,419,676
Stockholders equity $846,885 $314,131 $809,045 $300,412
Average yield on interest
earning assets 4.49% 6.17% 4.78% 6.31%
Average cost of interest
bearing liabilities 1.76% 2.57% 1.94% 2.65%
CAPITAL RATIOS:
Leverage capital 19.37% 9.16% 19.37% 9.16%
Total risk based capital 35.39% 14.50% 35.39% 14.50%
Average equity to
average assets 20.32% 10.10% 19.80% 9.98%
<FN>
Notes
(1) Basic and Diluted Earnings Per Share for nine months includes the results
of operations from January 15, 2003, the date we completed our Plan of
Conversion, in the amount of $9,553,000, for the nine months ended
September 30, 2003.
(2) Efficiency Ratio Calculation
9/30/03 9/30/02 9/30/03 9/30/02
------- ------- ------- -------
Net-Interest Income 30,737 28,960 95,977 85,175
Non-Interest Income 6,751 5,751 17,358 17,693
----- ----- ------ ------
Total Income: 37,488 34,711 113,335 102,868
Non-Interest Expense: 25,728 20,993 97,954 65,619
LESS: The Provident Bank
Foundation Donation --- --- (24,000) ---
Adjusted Non-Interest Expense 25,728 20,993 73,954 65,619
Expense/Income: 68.63% 60.48% 65.25% 63.79%
====== ====== ====== ======
(3) Certain prior period amounts have been reclassified to correspond with the
current period presentation.
</FN>