SCHEDULE 14A
(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the registrant [X]
Filed by a party other than the registrant [ ]

Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for use of the Commission
Only (as permitted by Rule 14a - 6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12

SUN BANCORP, INC.
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(Name of Registrant as Specified in Its Charter)

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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of filing fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1) Title of each class of securities to which transaction applies:

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(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11. (set forth the amount on which the filing
fee is calculated and state how it was determined):

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(4) Proposed maximum aggregate value of transaction:

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(5) Total fee paid:

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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.

(1) Amount previously paid:

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(2) Form, Schedule or Registration Statement No.:

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(3) Filing Party:

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(4) Date Filed:

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April 18, 2000

Dear Fellow Shareholder:

On behalf of the Board of Directors and management of Sun Bancorp, Inc.
(the "Company"), I cordially invite you to attend the Annual Meeting of
Shareholders to be held at 226 Landis Avenue, Vineland, New Jersey, on May 18,
2000, at 3:30 p.m. The attached Notice of Annual Meeting and Proxy Statement
describe the formal business to be transacted at the Annual Meeting. During the
Annual Meeting, I will also report on the operations of the Company. Directors
and officers of the Company, as well as a representative of Deloitte & Touche
LLP, certified public accountants, will be present to respond to any questions
shareholders may have.

The matters to be considered by shareholders at the Annual Meeting are
described in the accompanying Notice of Annual Meeting and Proxy Statement. The
Board of Directors of the Company has determined that the matters to be
considered at the Annual Meeting are in the best interests of the Company and
its shareholders. For the reasons set forth in the Proxy Statement, the Board of
Directors unanimously recommends a vote "FOR" each matter to be considered.

WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE SIGN AND
DATE THE ENCLOSED PROXY CARD AND RETURN IT IN THE ACCOMPANYING POSTAGE-PAID
RETURN ENVELOPE AS PROMPTLY AS POSSIBLE. THIS WILL NOT PREVENT YOU FROM VOTING
IN PERSON AT THE ANNUAL MEETING, BUT WILL ASSURE THAT YOUR VOTE IS COUNTED IF
YOU ARE UNABLE TO ATTEND THE ANNUAL MEETING. YOUR VOTE IS VERY IMPORTANT.

Sincerely,

/s/Bernard A. Brown
--------------------------
Bernard A. Brown
Chairman of the Board

NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders (the
"Meeting") of Sun Bancorp, Inc. (the "Company"), will be held at 226 Landis
Avenue, Vineland, New Jersey on May 18, 2000, at 3:30 p.m.

The Meeting is for the purpose of considering and acting upon the following
matters:

1. The election of seven directors of the Company;

2. The ratification of the amendment to the Sun Bancorp, Inc. 1997 Stock
Option Plan; and

3. Such other matters as may properly come before the meeting or any
adjournments thereof.

The Board of Directors is not aware of any other business to come before the
Meeting. Any action may be taken on the foregoing proposals at the Meeting on
the date specified above or on any date or dates to which, by original or later
adjournment, the Meeting may be adjourned. Shareholders of record at the close
of business on April 10, 2000 are the shareholders entitled to vote at the
Meeting and any adjournments thereof.

EACH SHAREHOLDER, WHETHER OR NOT HE OR SHE PLANS TO ATTEND THE MEETING, IS
REQUESTED TO SIGN, DATE AND RETURN THE ENCLOSED PROXY WITHOUT DELAY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE. ANY PROXY GIVEN BY THE SHAREHOLDER MAY BE
REVOKED BY FILING WITH THE SECRETARY OF THE COMPANY A WRITTEN REVOCATION OR A
DULY EXECUTED PROXY BEARING A LATER DATE. ANY SHAREHOLDER PRESENT AT THE MEETING
MAY REVOKE HIS OR HER PROXY AND VOTE IN PERSON ON EACH MATTER BROUGHT BEFORE THE
MEETING. HOWEVER, SHAREHOLDERS WHOSE SHARES ARE NOT REGISTERED IN THEIR OWN NAME
WILL NEED ADDITIONAL DOCUMENTATION FROM THE RECORD HOLDER TO VOTE IN PERSON AT
THE MEETING.

BY ORDER OF THE BOARD OF DIRECTORS

/s/Sidney R. Brown
--------------------------
Sidney R. Brown
Secretary
Vineland, New Jersey
April 18, 2000

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IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES IN ORDER TO ENSURE A QUORUM AT THE MEETING. A
SELF-ADDRESSED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED
IF MAILED IN THE UNITED STATES.
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PROXY STATEMENT
OF
SUN BANCORP, INC.
226 LANDIS AVENUE
VINELAND, NEW JERSEY 08360
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ANNUAL MEETING OF SHAREHOLDERS
May 18, 2000

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GENERAL
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This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Sun Bancorp, Inc. (the "Company") to be
used at the 2000 Annual Meeting of Shareholders of the Company which will be
held at 226 Landis Avenue, Vineland, New Jersey, on May 18, 2000, 3:30 p.m.
local time (the "Meeting"). The accompanying Notice of Annual Meeting of
Shareholders, form of proxy, Annual Report and this Proxy Statement are being
first mailed to the Company's shareholders entitled to notice of and to vote at
the Meeting, on or about April 18, 2000. The Annual Report does not constitute
"soliciting material" and is not to be deemed "filed" with the Securities and
Exchange Commission (the "Commission").

At the Meeting, shareholders will consider and vote upon (i) the
election of seven directors, (ii) the ratification of the amendment to the Sun
Bancorp, Inc. 1997 Stock Option Plan (the "1997 Stock Option Plan"), and (iii)
such other matters as may properly come before the Meeting or any adjournments
thereof. The Board of Directors of the Company (the "Board" or the "Board of
Directors") knows of no additional matters that will be presented for
consideration at the Meeting. Execution of a proxy, however, confers on the
designated proxy holder discretionary authority to vote the shares represented
by such proxy in accordance with their best judgment on such other business, if
any, that may properly come before the Meeting or any adjournment thereof.

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VOTING AND REVOCABILITY OF PROXIES
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Shareholders who execute proxies retain the right to revoke them at any
time. Unless so revoked, the shares represented by such proxies will be voted at
the Meeting and all adjournments thereof. Proxies may be revoked by written
notice to the Secretary of the Company at the address above or by the filing of
a later dated proxy prior to a vote being taken on a particular proposal at the
Meeting. A proxy will not be voted if a shareholder attends the Meeting and
votes in person. Proxies solicited by the Board of Directors will be voted as
specified thereon. If no specification is made, signed proxies will be voted
"FOR" the nominees for directors set forth below and "FOR" the ratification of
the amendment to the 1997 Stock Option Plan. The proxy confers discretionary
authority on the persons named thereon to vote with respect to the election of
any person as a director where a nominee is unable to serve, or for good cause
will not serve, and with respect to matters incident to the conduct of the
Meeting.

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VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
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Shareholders of record as of the close of business on April 10, 2000
(the "Record Date") are entitled to one vote for each share of common stock of
the Company (the "Common Stock") then held.

As of the Record Date, the Company had 9,186,350 shares of Common Stock
issued and outstanding.

The presence in person or by proxy of at least a majority of the
outstanding shares of Common Stock entitled to vote is necessary to constitute a
quorum at the Meeting. For purposes of determining the votes cast with respect
to any matter presented for consideration at the Meeting only those votes cast
"FOR" or "AGAINST" are included. Abstentions and broker non-votes (i.e., shares
held by brokers on behalf of their customers, which may not be voted on certain
matters because the brokers have not received specific voting instructions from
their customers with respect to such matters) will be counted solely for the
purpose of determining whether a quorum is present. In the event there are not
sufficient votes for a quorum or to ratify or adopt any proposals at the time of
the Meeting, the Meeting may be adjourned in order to permit the further
solicitation of proxies.

As to the election of directors, the proxy card being provided by the
Board of Directors allows a shareholder to vote for the election of the nominees
proposed by the Board of Directors, or to withhold authority to vote for the
nominees being proposed. Under the Company's bylaws, directors are elected by a
plurality of votes cast, without respect to either (i) broker non-votes or (ii)
proxies as to which authority to vote for the nominee being proposed is
withheld.

Concerning all other matters that may properly come before the Meeting,
including the ratification of the amendment to the 1997 Stock Option Plan, by
checking the appropriate box, a shareholder may: (i) vote "FOR" the item, or
(ii) vote "AGAINST" the item, or (iii) "ABSTAIN" with respect to the item.
Unless otherwise required, such matters shall be determined by a majority of
votes cast affirmatively or negatively without regard to (a) broker non-votes,
or (b) proxies marked "ABSTAIN" as to that matter.

Security Ownership of Certain Beneficial Owners

Persons and groups owning in excess of 5% of the outstanding shares of
Common Stock are required to file reports regarding such ownership pursuant to
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Other than
as set forth in the following table, management knows of no person or group that
owns more than 5% of the outstanding shares of Common Stock at the Record Date.

Percent of Shares of
Amount and Nature of Common Stock
Name and Address of Beneficial Owner Beneficial Ownership Outstanding
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Bernard A. Brown
71 West Park Avenue
Vineland, New Jersey 08360 2,971,647(1) 29.58%

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(1) Includes shares of Common Stock held directly as well as by spouse or
minor children, in trust and other indirect ownership, over which
shares the individual effectively exercise sole voting and investment
power, unless otherwise indicated. Includes 858,551 shares of Common
Stock that can be acquired pursuant to options that are exercisable
within 60 days of the Record Date. See "Director and Executive Officer
Compensation."

-2-

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INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
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Officers, directors and employees of the Company have an interest in a
matter being presented for shareholder ratification. Upon shareholder
ratification of Proposal II, there will be an increased number of shares of
Common Stock authorized for issuance under the 1997 Stock Option Plan. In
addition, certain employees, officers and directors of the Company have already
been granted stock options pursuant to the amendment to the 1997 Stock Option
Plan. The ratification of the amendment to the 1997 Stock Option Plan is being
presented as "Proposal II - Ratification of the Amendment to the 1997 Stock
Option Plan."

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PROPOSAL I - ELECTION OF DIRECTORS
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General Information

The entire Board of Directors is to be elected at the Meeting, each to
serve until the next Annual Meeting of Shareholders or until his or her
successor has been duly elected and qualified. Each nominee is currently a
member of the Board of Directors. All members of the current Board of Directors
are nominees, with the exception of Adolph F. Calovi, who is retiring from the
Board as of May 18, 2000.

It is intended that the proxies solicited by the Board will be voted
for the election of each of the named nominees unless otherwise specified. If
any of the nominees are unable to serve, the shares represented by all valid
proxies will be voted for the election of such substitute as the Board of
Directors may recommend or the size of the Board may be reduced to eliminate the
vacancy. At this time, the Board knows of no reason why any of the nominees
might be unavailable to serve.

The following table sets forth information with respect to the
directors, including their names, ages, the years they first became directors of
the Company, and the number and percentage of shares of the Common Stock
beneficially owned by each as of the Record Date.

Shares of Common Percent
Director Stock Beneficially of
Director Age (1) Position Since Owned (2) Class
-------- ------- -------- -------- ------------------ --------

Bernard A. Brown (3) 75 Chairman of the Board 1985 2,971,647 (4) 29.58%

Ike Brown (3) 45 Director 1998 1,000 *

Jeffrey S. Brown (3) 40 Director 1999 225,851 2.46%

Sidney R. Brown (3) 43 Vice Chairman, 1990 374,655 (5) 4.04%
Treasurer, Secretary

Adolph F. Calovi 77 Director 1990 564 *

Peter Galetto, Jr. 46 Director 1990 146,432 1.59%

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Philip W. Koebig, III 57 Director, President and 1995 327,401 (6) 3.49%
Chief Executive Officer

Anne E. Koons (3) 47 Director 1990 199,512 2.17%

All directors, nominees and executive officers of the 4,354,437 (7) 41.75%
Company as a group (11 persons)

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* Less than 1%.
(1) At December 31, 1999.
(2) Includes shares held directly by the individual as well as by such
individual's spouse, shares held in trust and in other forms of indirect
ownership over which shares the individual effectively exercises sole
voting and investment power.
(3) Ike Brown, Sidney R. Brown, Anne E. Koons and Jeffrey S. Brown are the
children of Bernard A. Brown.
(4) Includes 858,551 shares of Common Stock that may be acquired pursuant to
options that may be exercised within 60 days of the Record Date.
(5) Includes 89,279 shares of Common Stock that may be acquired pursuant to
options that may be exercised within 60 days of the Record Date.
(6) Includes 206,717 shares of Common Stock that may be acquired pursuant to
options that may be exercised within 60 days of the Record Date.
(7) Includes shares of Common Stock held directly as well as by spouses or
minor children, in trust and other indirect ownership, over which shares
the individuals effectively exercise sole voting and investment power,
unless otherwise indicated. Includes 1,243,171 options that may be
exercised within 60 days of the Record Date to purchase shares of Common
Stock. See "Director and Executive Officer Compensation."

Biographical Information

Directors and Executive Officers of the Company. The principal
occupation of each director and executive officer of the Company is set forth
below. All directors and executive officers have held their present positions
for five years unless otherwise stated.

Bernard A. Brown has been the Chairman of the Board of Directors of the
Company since its inception in January 1985. Mr. Brown is also the Chairman of
the Board of Directors of Sun National Bank ("Sun") and Sun National Bank,
Delaware ("Sun Delaware"), wholly owned subsidiaries of the Company. For many
years, Mr. Brown has been the Chairman of the Board of Directors and President
of NFI Industries, Inc., a trucking conglomerate headquartered in Vineland, New
Jersey.

Ike Brown has been a director of the Company since March 1998. He is
also a director of Sun Delaware. Mr. Brown is Vice Chairman and director of NFI
Industries, Inc. and is also one of the general partners of The Four B's, a
partnership which has extensive real estate holdings in the Eastern United
States and which primarily engages in investment in, and the consequent
development of, commercial real estate, leasing and/or sale. Mr. Brown is
currently an officer and director of several other corporations and partnerships
in the transportation, equipment leasing, insurance, warehousing and real estate
industries.

Jeffrey S. Brown has been a director of the Company since April 1999.
He is an officer and director of NFI Industries, Inc. and is also one of the
general partners of The Four B's, a partnership which has extensive real estate
holdings in the Eastern United States and which primarily engages in investment
in, and the consequent development of, commercial real estate, leasing and/or
sale. Mr. Brown is

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currently an officer and director of several other corporations and partnerships
in the transportation, equipment leasing, insurance, warehousing and real estate
industries.

Sidney R. Brown has been the Treasurer and a director of the Company
since April 1990. In March 1997, Mr. Brown became secretary of the Company, and
in March 1998 he became the Vice Chairman of the Board of Directors of the
Company. Mr. Brown is also a director of Sun Delaware. Mr. Brown is the chief
executive officer of NFI Industries, Inc., and one of the general partners of
The Four B's, a partnership which has extensive real estate holdings in the
Eastern United States and which primarily engages in investment in, and the
consequent development of, commercial real estate, leasing and/or sale. Mr.
Brown is currently an officer and director of several other corporations and
partnerships in the transportation, equipment leasing, insurance, warehousing
and real estate industries.

Adolph F. Calovi has been a director of the Company since its inception
in January 1985. He will retire from the Board of Directors as of May 18, 2000.
From 1985 to January 1999, Mr. Calovi was the Company's President and Chief
Executive Officer. Mr. Calovi was also a director of Sun and Sun Delaware and
from 1985 to 1994, he was the President and Chief Executive Officer of Sun.

Peter Galetto, Jr. has been a director of the Company since April 1990.
Mr. Galetto also served as secretary of the Company from April 1990 to March
1997. He is also a director of Sun Delaware. Mr. Galetto is the President/Sales
for Stanker & Galetto, Inc., an industrial and building contractor located in
Vineland, New Jersey. He is also the President of the Cumberland Technology
Enterprise Center, a small business incubator. Mr. Galetto has been the
Secretary/Treasurer of Trimark Building Contractors. He is also an officer and
director of several other corporations and organizations.

Philip W. Koebig, III has been the President and Chief Executive
Officer of the Company since January 1999 and was the Executive Vice President
of the Company from 1994 to 1999. He has been a director of the Company since
1995. Mr. Koebig has also been a director, President and Chief Executive Officer
of Sun since 1995. He is also Vice Chairman of the Board of Directors of Sun
Delaware. He also serves on the Board of Directors of numerous charitable
organizations and corporations.

Anne E. Koons has been a director of the Company since April 1990. Ms.
Koons is a real estate agent with Prudential Fox & Roach. Ms. Koons a member of
the Cooper Medical Center's Foundation Board. She is also a director of Sun
Delaware.

Robert F. Mack has been with the Company since April 1992 and currently
serves as an Executive Vice President. He is also an Executive Vice President
and Cashier of Sun and Sun Delaware. Mr. Mack has twenty-seven years of
extensive banking experience and has worked for several commercial banks in New
Jersey.

James S. Killough joined the Company in February 1997 and serves as
Executive Vice President of Administration, Operations and Retail Banking. He is
also an Executive Vice President of Sun and Sun Delaware. Before joining the
Company, Mr. Killough was president and chief professional officer for the
United Way of Camden County, New Jersey for two years. Prior to that, Mr.
Killough was executive vice president for Central Jersey Bank and Trust and
Midlantic National Bank/South.

Dan A. Chila joined the Company in April 2000 as the Executive Vice
President and Chief Financial Officer. Before joining the Company, Mr. Chila was
Senior Vice President and Chief Financial Officer of Peoples Bancorp,
Lawrenceville, New Jersey. Prior to that, Mr. Chila was Senior Vice

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President for CoreStates Financial Corporation. He has over 25 years of banking
experience and is a Certified Public Accountant.

Additional Executive Officers of Sun and Sun Delaware. Set forth below
is biographical information of certain executive officers of Sun or Sun Delaware
who are not also executive officers of the Company.

Bart A. Speziali has been with Sun since 1992 and is an Executive Vice
President and Senior Lending Officer. Mr. Speziali has over twenty years of
banking experience in southern New Jersey.

Warren C. Engle has been with Sun Delaware since May 1999 as its
President and Chief Executive Officer. He is also a director of Sun Delaware.
Mr. Engle has over 27 years of banking experience. Before joining Sun Delaware,
Mr. Engle was a bank executive for PNC Bank. Prior to that, Mr. Engle was a
senior officer for Wilmington Trust Company.

Meetings and Committees of the Board of Directors

The Company is governed by a Board of Directors and various committees
of the Board which meet regularly throughout the year. During the fiscal year
ended December 31, 1999, the Board of Directors held 8 regular meetings and 3
special meetings. With the exception of Ike Brown and Anne E. Koons, no director
attended fewer than 75% of the total meetings of the Board of Directors and
meetings of committees on which such director served during the year ended
December 31, 1999.

The Nominating Committee consists of the entire Board of Directors of
the Company. The Nominating Committee met once during the year ended December
31, 1999. The Nominating Committee is not required to consider nominees
recommended by shareholders.

The Audit Committee consists of Directors Calovi, Galetto and Koons.
The Audit Committee is responsible for recommending the appointment of the
Company's independent public accountants and meeting with such accountants with
respect to the scope and review of the annual audit. Additional responsibilities
of the Audit Committee are to ensure that the Board of Directors receives
objective information regarding policies, procedures and activities of the
Company with respect to auditing, accounting, internal accounting controls,
financial reporting, regulatory matters and such other activities of the Company
as may be directed by the Board of Directors. The Audit Committee met twice
during the year ended December 31, 1999.

The Personnel Committee consists of Directors Koons, Sidney Brown and
Koebig. The Personnel Committee met once during the year ended December 31,
1999.

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DIRECTOR AND EXECUTIVE OFFICER COMPENSATION
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Directors' Compensation

Each member of the Board of Directors, except for the chairman and
employee directors, received a fee of $300 for each board meeting and $200 for
each committee meeting attended for the year ended December 31, 1999. Directors
who are executive officers do not receive any fees for their services as

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directors. For the year ended December 31, 1999, directors fees totaled $38,800,
all of which was paid in shares of Common Stock.

Executive Compensation

Summary Compensation Table. The following table sets forth compensation
awarded to the Chief Executive Officer and the five highest compensated
executive officers of the Company for the year ended December 31, 1999.

Long Term
Compensation
Annual Compensation Awards
------------------------ -------------
Securities
Name and Underlying All Other
Principal Position Year Salary Bonus Options(#)(1) Compensation
------------------ ---- ------ ------ ------------- -------------

Philip W. Koebig, III 1999 $315,000 $110,000 50,053 $12,591 (2)
President and Chief Executive 1998 257,692 60,000 5,292 13,286
Officer 1997 199,039 -- 24,807 11,658

Bernard A. Brown 1999 162,500 55,000 282,776 --
Chairman 1998 129,106 30,000 265,146 --
1997 98,077 -- 124,032 --

James S. Killough 1999 155,000 31,500 2,625 --
Executive Vice President 1998 144,808 15,000 -- --
1997 105,769 -- 31,008 --

Bart A. Speziali 1999 134,000 24,000 2,625 --
Executive Vice President 1998 124,165 15,000 -- --
of Sun 1997 106,704 -- 4,961 --

Harry G. Miller (3) 1999 132,942 30,000 2,625 --
Executive Vice President of Sun 1998 145,385 -- -- --
1997 105,769 -- 16,538 --

Robert F. Mack 1999 129,038 23,625 2,625 --
Executive Vice President 1998 108,365 15,000 -- --
1997 83,654 -- 4,961 --

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(1) Prior awards adjusted for stock dividends.
(2) For Mr. Koebig, all other compensation constitutes life and disability
insurance premiums of $8,151, and country club dues of $4,440 for 1999. Mr.
Koebig became President and CEO of the Company on January 19, 1999.
(3) Mr. Miller retired from Sun in October 1999.

Stock Option Plans. The Company has adopted the 1985 Stock Option Plan,
the 1995 Stock Option Plan and the 1997 Stock Option Plan (the "Option Plans").
Officers, directors and employees are eligible to receive, at no cost to them,
options under the Option Plans. Options granted under the Option Plans may be
either incentive stock options (options that afford favorable tax treatment to
recipients upon

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compliance with certain restrictions pursuant to Section 422 of the Internal
Revenue Code and that do not normally result in tax deductions to the Company)
or options that do not so qualify. The option price may not be less than 100% of
the fair market value of the shares on the date of the grant. Option shares may
be paid in cash, shares of the common stock, or a combination of both. Incentive
options are exercisable for a period of ten years. Non-qualified stock options
are exercisable for a period of ten years and ten days.

The following tables set forth additional information concerning
options granted under the Option Plans.

Option Grants in Last Fiscal Year(1)
------------------------------------
Potential Realizable Value at
Assumed Annual Rates of Stock
Price Appreciation for
Individual Grants Option Term
-------------------------------------------------------------- --------------------------------
Percent of Total
Number of Options Granted
Options to Employees in Exercise Price Expiration
Name Granted(1) Fiscal Year ($/Share) Date 5% ($) 10% ($)
---- ---------- --------------- -------------- ---------- -------- --------

Philip W. Koebig, III 7,937 1.79% $17.86 1/08/09 $230,904 $367,675
2,563 0.58% $17.86 1/18/09 $74,563 $118,729
14,553 3.29% $17.14 4/12/09 $406,309 $646,979
25,000 5.65% $14.25 10/21/09 $580,294 $924,021

Bernard A. Brown 8,884 2.01% $19.65 1/08/09 $284,357 $452,791
1,616 0.37% $17.86 1/18/09 $47,013 $74,860
7,276 1.64% $17.14 4/12/09 $203,140 $323,467
265,000 59.90% $14.25 10/21/09 $6,151,113 $9,794,620

James S. Killough 2,625 0.59% $17.86 1/08/09 $76,367 $121,601
Bart A. Speziali 2,625 0.59% $17.86 1/08/09 $76,367 $121,601
Harry G. Miller 2,625 0.59% $17.86 1/08/09 $76,367 $121,601
Robert F. Mack 2,625 0.59% $17.86 1/08/09 $76,367 $121,601

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Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End Option Values
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Value of
Number of Options In-the-money Options
Shares Acquired Value at Fiscal Year-End(#) at Fiscal Year-End($)
Name on Exercise (#) Realized Exercisable/Unexercisable Exercisable/Unexercisable(1)
- ---- --------------- -------- ------------------------- ----------------------------

Philip W. Koebig, III -- $ -- 206,717/37,527 $827,620/$--

Bernard A. Brown -- -- 858,551/405,138 $3,149,944/$--

James S. Killough -- -- 32,320/1,313 $52,946/$--

Bart A. Speziali -- -- 28,152/1,313 $108,777/$--

Harry G. Miller -- -- 8,269/-- $--/$--

Robert F. Mack -- -- 28,152/1,313 $108,777/$--

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(1) Based upon the difference between the option exercise price and the market
price of stock of $9.94 per share as of December 31, 1999.

Personnel Committee Report on Executive Compensation

The Personnel Committee (the "Committee") has furnished the following
report on executive compensation:

Under the supervision of the Board of Directors, the Company has
developed and implemented compensation policies, plans and programs which seek
to enhance the profitability of the Company, and thus shareholder value, by
aligning closely the financial interests of the Company's employees, including
its Chief Executive Officer ("CEO"), Chairman and other senior management, with
the interests of its shareholders. With regard to compensation actions affecting
the CEO, the Executive Committee of the Board of Directors, which consists of
the members of the Personnel Committee and all of the non-employee members of
the Board of Directors, acted as the approving body.

The executive compensation program of the Company is designed to:

o Support a pay-for-performance policy that differentiates compensation
based on corporate and individual performance;

o Motivate employees to assume increased responsibility and reward them
for their achievement;

o Provide compensation opportunities that are comparable to those
offered by other leading companies, allowing the Company to compete
for and retain top quality, dedicated executives who are critical to
the Company's long-term success; and

o Align the interests of executives with the long-term interests of
shareholders through award opportunities that can result in ownership
of Common Stock.

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At present, the executive compensation program is comprised of salary,
annual cash incentive opportunities, long-term incentive opportunities in the
form of stock options, and miscellaneous benefits typically offered to
executives in comparable corporations. The Committee considers the total
compensation (earned or potentially available) in establishing each element of
compensation so that total compensation paid is competitive with the market
place, based on an independent consultant's survey of salary competitiveness of
other financial institutions. The Committee is advised periodically by
independent compensation consultants concerning salary competitiveness.

As an executive's level of responsibility increases, a greater portion
of his or her potential total compensation opportunity is based on Company
performance incentives rather than on salary. Reliance on Company performance
causes greater variability in the individual's total compensation from year to
year. By varying annual and long-term compensation and basing both on corporate
performance, the Company believes executive officers are encouraged to continue
focusing on building profitability and shareholder value. The mix of annual and
long-term compensation was set subjectively. In determining the mix, the
Committee balanced rewards for past performance with incentives for future
performance, and took into account such factors as overall risk of the pay
package and award sizes in prior years.

Base Salary. Annual base salaries for all executive officers are
generally set somewhat below competitive levels so that the Company relies to a
large degree on annual and longer term incentive compensation to attract and
retain corporate officers and other employees and to motivate them to perform to
the full extent of their abilities. Effective January 1, 1999, the Board of
Directors, acting on the recommendation of the Committee, increased the base
salary paid to executive officers. The increase reflected consideration of
competitive data provided by an independent consulting firm, the Committee's and
the Board's assessment of the executive officer's performance over the previous
year and recognition of the improvement in performance by the Company during
1998 as compared with the Company's goals included in its business plan.

Long-Term Incentive Compensation. The long-term incentive compensation
consists of stock option awards. The Committee believes that issuing stock
options to executives benefits the Company's shareholders by encouraging and
enabling executives to own stock of the Company, thus aligning executive pay
with shareholder interests.

1999 Compensation for the CEO. Mr. Koebig has served as President and
Chief Executive Officer of the Company since January 1999. Mr. Koebig's salary
for 1999 of $315,000 reflected the Board's assessment of his performance over
the previous year and was based upon his prior years of service to the Bank and
the Company.

Compensation Committee:

Sidney R. Brown
Philip W. Koebig, III
Anne E. Koons

Stock Performance Graph

Set forth below is a stock performance graph comparing the cumulative
total shareholder return on the Common Stock with (a) the cumulative total
shareholder return on stocks included in the Nasdaq Stock Market index and (b)
the cumulative total shareholder return on stocks included in the Nasdaq Bank

-10-

index, as prepared for Nasdaq by the Center for Research in Securities Prices
("CRSP") at the University of Chicago. All three investment comparisons assume
the investment of $100 as of August 29, 1996 (the date the Common Stock began
trading on the Nasdaq Stock Market). The cumulative total returns for the Nasdaq
Stock Market index and the Nasdaq Bank index are computed assuming the
reinvestment of dividends. In the graph below, the periods compared were August
29, 1996 and the Company's fiscal years ended December 31, 1996, 1997, 1998 and
1999.

There can be no assurance that the Company's future stock performance
will be the same or similar to the historical stock performance shown in the
graph below. The Company neither makes nor endorses any predictions as to stock
performance.

[GRAPHIC OMITTED]

================================================================================
8/29/96 12/31/96 12/31/97 12/31/98 12/31/99
- --------------------------------------------------------------------------------
CRSP Nasdaq U.S. Index $100 $113 $138 $194 $351
- --------------------------------------------------------------------------------
CRSP Nasdaq Bank Index 100 120 201 200 192
- --------------------------------------------------------------------------------
Sun Bancorp, Inc. 100 98 160 214 121
================================================================================
- ----------------------------------
(1) The cumulative total return for Sun Bancorp, Inc. reflects 5% stock
dividends paid on October 30, 1996, June 25, 1997, May 26, 1998 and
June 21, 1999 and 50% stock dividends paid in September 1997 and March
1998 and has been calculated based on the historical closing prices of
$22.50 on August 29, 1996 (the first day of trading on the Nasdaq Stock
Market), $21.00 on December 31, 1996, $21.83 on December 31, 1997,
$18.50 on December 31, 1998 and $9.94 on December 31, 1999.

The information set forth above under the subheadings "Compensation
Committee Report on Executive Compensation" and "Stock Performance Graph" (i)
shall not be deemed to be "soliciting material" or to be "filed" with the
Commission or subject to Regulation 14A or the liabilities of Section 18 of the
Exchange Act, and (ii) notwithstanding anything to the contrary that may be
contained in any

-11-

filing by the Company under such Act or the Securities Act of 1933, as amended
("Securities Act"), shall not be deemed to be incorporated by reference in any
such filing.

- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION ABOUT DIRECTORS AND EXECUTIVE OFFICERS
- --------------------------------------------------------------------------------
Compensation Committee Interlocks and Insider Participation

The members of the Personnel Committee of the Company's Board of
Directors during the year ended December 31, 1999 were Anne E. Koons, Sidney R.
Brown and Philip W. Koebig, III. Each is also a member of the Board of Directors
of the Company. Mr. Koebig is also a director and officer of Sun and did not
participate in matters involving his personal compensation. No member of the
Committee is, or was during 1999, an executive officer of another company whose
board of directors has a comparable committee on which one of the Company's
executive officers serves. None of the executive officers of the Company is, or
was during 1999, a member of a comparable compensation committee of a company of
which any of the directors of the Company is an executive officer.

Certain Relationships and Related Transactions

Bernard A. Brown, the Chairman of the Board of Directors of the
Company, Sun and Sun Delaware, is an owner of Vineland Construction Company. The
Company and Sun lease office space in Vineland, New Jersey from Vineland
Construction Company. The Company believes that the transactions with Vineland
Construction Company are on terms substantially the same, or at least as
favorable to Sun, as those that would be provided by a non-affiliate. The
Company paid $575,833 to Vineland Construction during the year ended December
31, 1999. Sun is also party to a lease agreement for an office building with a
partnership comprised of directors and shareholders of the Company and Sun. The
Company believes that the lease is on terms substantially the same, or at least
as favorable to Sun, as those that would be provided by a non-affiliate. The
Company paid $525,106 in annual rent under this lease agreement during the year
ended December 31, 1999.

Sun and Sun Delaware have a policy of offering various types of loans
to officers, directors and employees of the Bank and of the Company. These loans
have been made in the ordinary course of business and on substantially the same
terms and conditions (including interest rates and collateral requirements) as,
and following credit underwriting procedures that are not less stringent than,
those prevailing at the time for comparable transactions by Sun and Sun Delaware
with its other unaffiliated customers and do not involve more than the normal
risk of collectibility, nor present other unfavorable features. All of these
loans were current at December 31, 1999.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires the Company's officers and
directors, and persons who own more than ten percent of the Common Stock, to
file reports of ownership and changes in ownership of the Common Stock with the
Commission and the Nasdaq National Market, and to provide copies of those
reports to the Company.

Based upon a review of the copies of the forms furnished to the
Company, or written representations from certain reporting persons, the Company
believes that all Section 16(a) filing requirements applicable to its executive
officers and directors were complied with during the year ended December 31,
1999.

-12-

- --------------------------------------------------------------------------------
PROPOSAL II - RATIFICATION OF THE AMENDMENT TO THE
1997 STOCK OPTION PLAN
- --------------------------------------------------------------------------------
Amendment Summary

The Company's Board of Directors has adopted an amendment to the 1997
Stock Option Plan. In accordance with such amendment to the 1997 Stock Option
Plan, the total number of shares of Common Stock authorized for issuance under
the 1997 Stock Option Plan has been increased from 635,370 shares to 1,035,370
shares. Such amendment is subject to stockholder ratification.

General Plan Description

The purpose of the 1997 Stock Option Plan is to attract and retain
qualified personnel for positions of substantial responsibility and to provide
additional incentives to certain officers and key employees to promote the
success of the Company's business. The following summary of the material
features of the 1997 Stock Option Plan is qualified in its entirety by reference
to the complete provisions of the 1997 Stock Option Plan.

The 1997 Stock Option Plan is administered by the Company's Board of
Directors and a committee of not less than two nor more than seven non-employee
directors appointed by the Board and serving at the pleasure of the Board (the
"Option Committee"). Members of the Option Committee are "Non-Employee
Directors" within the meaning of Rule 16b-3 pursuant to the Exchange Act. The
Option Committee selects those individuals to whom options are granted, the
number of options granted, and whether the option granted is an incentive stock
option or a nonqualified stock option. A majority of the members of the Option
Committee constitutes a quorum and the vote or written consent of a majority of
the members of the Option Committee constitutes the action of the Option
Committee.

Employees, officers, directors and advisory directors who are
designated by the Option Committee are eligible to receive, at no cost to them,
options under the 1997 Stock Option Plan (the "Optionees"). Options granted
under the 1997 Stock Option Plan constitute either incentive stock options
(options that afford favorable tax treatment to recipients upon compliance with
certain restrictions pursuant to Section 422 of the Internal Revenue Code
("Code") and that do not normally result in tax deductions to the Company) or
nonqualified stock options (options that do not afford recipients favorable tax
treatment under Code Section 422). Option shares may be paid for in cash, shares
of Common Stock, or a combination of both. The Company will receive no
consideration other than the option exercise price per share for Common Stock
issued to Optionees upon the exercise of those Options.

Shares issuable under the 1997 Stock Option Plan may be from authorized
but unissued shares or they may be reacquired shares. An Option which expires,
becomes unexercisable or is forfeited for any reason prior to its exercise, will
again be available for issuance under the 1997 Stock Option Plan.

Transferability

An incentive stock option is not assignable or transferable other than
by will or by the laws of descent and distribution. A nonqualified stock option,
on the other hand, is, with the prior written consent of the Option Committee,
assignable or transferable during the Optionee's lifetime.

-13-

Stock Options

The Option Committee may grant both an incentive stock option and a
nonqualified stock option to the same person, or more than one of each type of
option to the same person. The option price for both incentive stock options and
nonqualified stock options issued under the 1997 Stock Option Plan must be equal
to at least the fair market value of the Common Stock as of the date of the
grant of the option. Fair market value is determined by the Option Committee in
accordance with its interpretation of the requirements of Section 422 of the
Code and the regulations thereunder.

If an Optionee ceases to serve as an employee of the Company for any
reason other than disability or death, an exercisable incentive stock option
continues to be exercisable for three months but in no event after the
expiration date of the option, except as may otherwise be determined by the
Option Committee at the time of the award. Nonqualified stock options expire ten
years and ten days after the date they are granted, unless terminated earlier
under the option terms. These are determined by the Option Committee, in its
sole discretion at the time of grant.

If an officer or employee owns Common Stock representing more than ten
percent of the outstanding Common Stock at the time an incentive stock option is
granted, then the exercise price shall not be less than one hundred and ten
percent (110%) of the Fair Market Value of the Common Stock at the time the
incentive stock option is granted. No more than $100,000 of incentive stock
options may become exercisable for the first time in any one year for any one
person. The Option Committee may impose additional conditions upon the right of
an Optionee to exercise any Option granted hereunder which are not inconsistent
with the terms of the 1997 Stock Option Plan or the requirements for
qualification as an incentive stock option, if such Option is intended to
qualify as an incentive stock option.

Upon the exercise of an Option by an Optionee (or the Optionee's
personal representative), the Option Committee, in its sole and absolute
discretion, may make a cash payment to the Optionee, in whole or in part, in
lieu of the delivery of shares of Common Stock. A cash payment paid in lieu of
delivery of Common Stock must equal the difference between the Fair Market Value
of the Common Stock on the date of the Option exercise and the exercise price
per share of the Option. Such cash payment shall be in exchange for the
cancellation of such Option and may not be made in the event that the
transaction would result in liability to the Optionee and the Company under
Section 16(b) of the Exchange Act, and the regulations promulgated thereunder.

Awards Under the 1997 Stock Option Plan

The Board or the Option Committee, from time to time and in their sole
discretion, determine which officers, employees, directors and advisory
directors of the Company and each present and future subsidiary corporation of
the Company are eligible to receive options under the 1997 Stock Option Plan,
which of these individuals shall be granted an option or options, whether the
option shall be an incentive stock option or a nonqualified stock option, the
time or times at which the options shall be granted, the rate of option
exercisability, and, pursuant to the 1997 Stock Option Plan, the price at which
each of the options is exercisable and the duration of the option. On May 20,
1999, stockholders of the Company ratified an amendment to the 1997 Stock Option
Plan authorizing the grant of "reload" options. The award of a reload option
allows the optionee to received the grant of an additional stock option in the
event that such optionee exercises all or part of an option (an "original
option") by surrendering already owned shares of Common Stock in full or partial
payment of the option price under such original option. The exercise of an
additional option issued in accordance with the "reload" feature will reduce the
total number of shares eligible for award under the 1997 Stock Option Plan.

-14-

The table below presents information related to stock option awards
made pursuant to the amendment to the 1997 Stock Option Plan to increase the
authorized shares under the 1997 Stock Option Plan to 1,035,370 from 635,370
shares, subject to shareholder ratification of the amendment. The stock options
granted as set forth in the table below vest 50% one year from the date of grant
and are 100% vested two years from the date of grant and were granted with a
"reload" feature.

NEW PLAN BENEFITS
-----------------

Name and Position Dollar Value No. of Options Granted
- ----------------- ------------ -----------------------

Philip W. Koebig, III $-- (2) 25,000
President and Chief Executive Officer(1)

Bernard A. Brown -- (2) 48,168
Chairman of the Board(1)

James S. Killough -- (3) 2,500
Executive Vice President

Bart A. Speziali -- (3) 2,500
Executive Vice President of Sun

Executive Officer Group (6 persons) -- (2)(3) 78,168

Non-Executive Director Group ( 1 person) -- (2) 40,000

Non-Executive Officer Employee Group (28 persons) -- (3) 30,250

- ---------------------------------------
(1) Nominee for director.
(2) Based on an exercise price of $14.25 per share, which equals the fair
market value of the Common Stock on the date of grant, and the last
sale price of the Common Stock at the close of the market as reported
on the Nasdaq National Market on April 10, 2000 of $7.00 per share.
(3) Based on an exercise price of $7.00 per share, which equals the fair
market value of the Common Stock on the date of grant, and the last
sale price of the Common Stock at the close of the market as reported
on the Nasdaq National Market on April 10, 2000 of $7.00 per share.

Effect of Mergers, Change of Control and Other Adjustments

Subject to any required action by the shareholders of the Company, the
Option Committee, within its discretion, may make proportional adjustments to
the aggregate number of shares of Common Stock for which Options may be granted
hereunder or the number of shares of Common Stock represented by each
outstanding Option to adjust for any increase or decrease in the number of
issued and outstanding shares of Common Stock as a result of a subdivision or
consolidation of shares or the payment of a stock dividend or any other increase
or decrease in the number of shares of Common Stock effected without the receipt
or payment of consideration by the Company. Subject to any required action by
the shareholders of the Company, in the event of any change in control,
recapitalization, merger, consolidation, exchange of shares, spin-off,
reorganization, tender offer, partial or complete liquidation or other
extraordinary corporate action or event, the Option Committee, in its
discretion, has the power, prior to or subsequent to such action or events, to
(i) appropriately adjust the number of shares of Common Stock subject to each
Option, the exercise price per share of such Option, and the consideration to be
given or received by the Company upon the exercise of any outstanding Options;
(ii) cancel any or all previously granted Options, provided that appropriate
consideration is paid to the Optionee in connection therewith; and/or (iii) make

-15-

such other adjustments in connection with the 1997 Stock Option Plan as the
Option Committee, in its discretion, deems necessary, desirable, appropriate or
advisable. However, no action may be taken by the Option Committee which would
cause incentive stock options granted pursuant to the 1997 Stock Option Plan to
fail to meet the requirements of Section 422 of the Code without the consent of
the Optionee. Upon the payment of a special or non-recurring cash dividend that
has the effect of a return of capital to the shareholders, the Option exercise
price per share would be adjusted proportionately.

The Option Committee has the power to accelerate the exercise date of
all Options granted under the 1997 Stock Option Plan. In the case of a Change in
Control of the Company as determined by the Option Committee, all outstanding
options shall become immediately exercisable. A Change in Control is defined to
include (i) the sale of all, or a material portion, of the assets of the
Company; (ii) the merger or recapitalization of the Company whereby the Company
is not the surviving entity; (iii) the acquisition, directly or indirectly, of
the beneficial ownership (within the meaning of Section 13(d) of the Exchange
Act and rules and regulations promulgated thereunder) of 25% or more of the
outstanding voting securities of the Company by any person, trust, entity, or
group. This limitation does not apply to the purchase of shares by underwriters
in connection with a pubic offering of Company stock or the purchase of shares
of up to 25% of any class of securities of the Company by a tax-qualified
employee stock benefit plan which is exempt from the approval requirements in
effect, or as may hereafter be amended.

In the event of such a Change in Control, the Option Committee and the
Board of Directors would take one or more of the following actions to be
effective as of the date of such Change in Control: (i) provide that such
Options shall be assumed, or equivalent options shall be substituted,
("Substitute Options") by the acquiring or succeeding corporation (or an
affiliate thereof), provided that: (A) any such Substitute Options exchanged for
incentive stock options shall meet the requirements of Section 424(a) of the
Code, and (B) the shares of stock issuable upon the exercise of such Substitute
Options shall constitute securities registered in accordance with the Securities
Act or such securities shall be exempt from such registration in accordance with
Sections 3(a)(2) or 3(a)(5) of the Securities Act, (collectively, "Registered
Securities"), or in the alternative, if the securities issuable upon the
exercise of such Substitute Options do not constitute Registered Securities,
then the Optionee will receive upon consummation of the Change in Control
transaction a cash payment for each Option surrendered equal to the difference
between (1) the Fair Market Value of the consideration to be received for each
share of Common Stock in the Change in Control transaction times the number of
shares of Common Stock subject to such surrendered Options, and (2) the
aggregate exercise price of all such surrendered Options, or (ii) in the event
of a transaction under the terms of which the holders of the Common Stock of the
Company will receive upon consummation thereof a cash payment (the "Merger
Price") for each share of Common Stock exchanged in the Change in Control
transaction, to make or to provide for a cash payment to the Optionees equal to
the difference between (A) the Merger Price times the number of shares of Common
Stock subject to such Options held by each Optionee (to the extent then
exercisable at prices not in excess of the Merger Price) and (B) the aggregate
exercise price of all such surrendered Options in exchange for such surrendered
Options.

The power of the Option Committee to accelerate the exercise of Options
and the immediate exercisability of Options in the case of a Change in Control
of the Company could have an anti-takeover effect by making it more costly for a
potential acquiror to obtain control of the Company due to the higher number of
shares outstanding following such exercise of Options. The power of the Option
Committee to make adjustments in connection with the 1997 Stock Option Plan,
including adjusting the number of shares subject to Options and canceling
Options, prior to or after the occurrence of an extraordinary corporate action,
allows the Option Committee to adapt the 1997 Stock Option Plan to operate in
changed circumstances, to adjust the 1997 Stock Option Plan to fit a smaller or
larger company, and to permit the issuance of Options to new management
following such extraordinary corporate action. However, this

-16-

power of the Option Committee also has an anti-takeover effect, by allowing the
Option Committee to adjust the 1997 Stock Option Plan in a manner to allow the
present management of the Company to exercise more options and hold more shares
of the Company's Common Stock, and to possibly decrease the number of Options
available to new management of the Company. The 1997 Stock Option Plan could
render it more difficult to obtain support for shareholder proposals opposed by
the Company's Board and management in that recipients of Options could choose to
exercise such Options and thereby increase the number of shares for which they
hold voting power. In addition, the exercise of such Options could increase the
cost of an acquisition by a potential acquiror.

Possible Dilutive Effects of the 1997 Stock Option Plan

To the extent that the Company funds the 1997 Stock Option Plan, in
whole or in part, with authorized but unissued shares, the interests of current
shareholders is diluted. If, upon exercise of all of the additional shares
authorized for issuance under the 1997 Stock Option Plan in accordance with the
amendment to the 1997 Stock Option Plan increasing the total number of shares
authorized for issuance, the Company delivers newly issued shares of Common
Stock (i.e., 400,000 shares), then the dilutive effect to stockholders would be
approximately 4.17%.

Federal Income Tax Consequences

Under present federal tax laws, awards under the 1997 Stock Option Plan
have the following consequences:

1. The grant of an Option does not by itself result in the recognition of
taxable income to an Optionee or entitle the Company to a tax
deduction at the time of such grant.

2. The exercise of an Option which is an "incentive stock option" within
the meaning of Section 422 of the Code generally does not, by itself,
result in the recognition of taxable income to an Optionee or entitle
the Company to a deduction at the time of such exercise. However, the
difference between the Option exercise price and the Fair Market Value
of the Common Stock on the date of Option exercise is an item of tax
preference which may, in certain situations, trigger the alternative
minimum tax for an Optionee. An Optionee would recognize capital gain
or loss upon resale of the shares of Common Stock received pursuant to
the exercise of incentive stock options, provided that such shares
were held for at least one year after transfer of the shares or two
years after the grant of the Option, whichever is later. Generally, if
the shares were not held for that period, the Optionee would recognize
ordinary income upon disposition in an amount equal to the difference
between the Option exercise price and the Fair Market Value of the
Common Stock on the date of exercise, or, if less, the sales proceeds
of the shares acquired pursuant to the Option.

3. The exercise of a nonqualified stock option results in the recognition
of ordinary income by the Optionee on the date of exercise in an
amount equal to the difference between the exercise price and the Fair
Market Value of the Common Stock acquired pursuant to the Option.

4. The Company would be allowed a tax deduction for federal tax purposes
equal to the amount of ordinary income recognized by an Optionee at
the time the Optionee recognizes such ordinary income.

-17-

5. In accordance with Section 162(m) of the Code, the Company's tax
deductions for compensation paid to the most highly paid executives
named in the Company's Proxy Statement may be limited to no more than
$1 million per year, excluding certain "performance-based"
compensation. The Company intends for the award of Options under the
1997 Stock Option Plan to comply with the requirement for an exception
to Section 162(m) of the Code applicable to stock option plans so that
the Company's deduction for compensation related to the exercise of
Options would not be subject to the deduction limitation set forth in
Section 162(m) of the Code.

Accounting Treatment

The Company uses the "intrinsic value based method" as prescribed by
APB Opinion 25. Accordingly, neither the grant nor the exercise of an Option
under the 1997 Stock Option Plan currently requires any charge against earnings
under generally accepted accounting principles. Shares of Common Stock issuable
pursuant to outstanding Options which are exercisable and potentially dilutive
under the 1997 Stock Option Plan are considered outstanding for purposes of
calculating earnings per share on a fully diluted basis.

Shareholder Ratification

Shareholder ratification of the adoption of the amendment to the 1997
Stock Option Plan is being sought by the Board to meet the requirements for
continued listing of the Common Stock under the Nasdaq National Market. An
affirmative vote of the holders of a majority of the shares present, in person
or by proxy, and entitled to vote at the Meeting is required to constitute
shareholder ratification of this Proposal II. Proxies marked "ABSTAIN" for
purposes of Proposal II will have the same effect as a vote against the
proposal.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RATIFICATION OF THE
AMENDMENT TO THE 1997 STOCK OPTION PLAN. UNLESS MARKED TO THE CONTRARY, THE
SHARES REPRESENTED BY SIGNED PROXIES WILL BE VOTED FOR RATIFICATION OF THE
AMENDMENT TO THE 1997 STOCK OPTION PLAN.

- --------------------------------------------------------------------------------
OTHER MATTERS
- --------------------------------------------------------------------------------
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described in this Proxy Statement. However, if
any other matters should properly come before the Meeting, it is intended that
proxies in the accompanying form will be voted in respect thereof in accordance
with the judgment of the persons named in the accompanying proxy.

- --------------------------------------------------------------------------------
INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
A representative of Deloitte & Touche LLP, the Company's independent
accountants, is expected to be present at the Meeting, will have the opportunity
to make a statement at the meeting if he or she desires to do so, and will be
available to respond to appropriate questions.

-18-

- --------------------------------------------------------------------------------
MISCELLANEOUS
- --------------------------------------------------------------------------------
The cost of soliciting proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of Common Stock. In addition to solicitations by mail,
directors, officers, and regular employees of the Company may solicit proxies
personally or by telephone without additional compensation.

- --------------------------------------------------------------------------------
SHAREHOLDER PROPOSALS AND NOMINATIONS
- --------------------------------------------------------------------------------
In order to be considered for inclusion in the Company's proxy
materials for next year's Annual Meeting of Shareholders, any shareholder
proposal to take action at such meeting must be received at the Company's
executive offices at 226 Landis Avenue, Vineland, New Jersey 08360, no later
than December 19, 2000. Any such proposal shall be subject to the requirements
of the proxy rules adopted by the SEC under the Exchange Act.

Under the Company's bylaws, shareholder proposals that are not included
in the Company's proxy materials for next year's annual meeting of shareholders,
will only be considered at the annual meeting if the stockholder submits notice
of the proposal to the Company at the above address by March 19, 2001. In
addition, shareholder proposals must meet other applicable criteria as set forth
in the Company's bylaws in order to be considered at next year's meeting.

The Company's bylaws include provisions setting forth specific
conditions under which persons may be nominated as directors of the Company at
an annual meeting of shareholders. A copy of such provisions is available upon
request to: Sun Bancorp, Inc., 226 Landis Avenue, Vineland, New Jersey 08360,
Attention: Corporate Secretary.

- --------------------------------------------------------------------------------
FORM 10-K
- --------------------------------------------------------------------------------
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED
DECEMBER 31, 1999, WILL BE FURNISHED WITHOUT CHARGE (WITHOUT EXHIBITS) TO
SHAREHOLDERS AS OF THE RECORD DATE UPON WRITTEN REQUEST TO THE SECRETARY, SUN
BANCORP, INC., 226 LANDIS AVENUE, VINELAND, NEW JERSEY 08360.

BY ORDER OF THE BOARD OF DIRECTORS

/s/Sidney R. Brown
--------------------------------
Sidney R. Brown
Secretary

Vineland, New Jersey
April 18, 2000

-19-

- --------------------------------------------------------------------------------
SUN BANCORP, INC.
226 LANDIS AVENUE
VINELAND, NEW JERSEY 08360
- --------------------------------------------------------------------------------
ANNUAL MEETING OF SHAREHOLDERS
May 18, 2000
- --------------------------------------------------------------------------------
The undersigned hereby appoints the Board of Directors of Sun Bancorp,
Inc. (the "Company"), or its designee, with full powers of substitution, to act
as attorneys and proxies for the undersigned, to vote all shares of Common Stock
of the Company which the undersigned is entitled to vote at the Annual Meeting
of Shareholders (the "Meeting"), to be held at 226 Landis Avenue, Vineland, New
Jersey, on May 18, 2000, at 3:30 p.m. and at any and all adjournments thereof,
in the following manner:

FOR WITHHELD

1. The election as directors of the nominees
listed below (except as marked to the [ ] [ ]
contrary below):

Bernard A. Brown
Ike Brown
Jeffrey S. Brown
Sidney R. Brown
Peter Galetto, Jr.
Philip W. Koebig, III
Anne E. Koons

(Instruction: To withhold authority to vote
for any individual nominee, write that nominee's name
on the line provided below)
-------------------------------------------------
FOR AGAINST ABSTAIN
--- ------- -------

2. Ratification of the amendment to
the Sun Bancorp, Inc. 1997 Stock
Option Plan [ ] [ ] [ ]

In their discretion, such attorneys and proxies are authorized to vote on any
other business that may properly come before the meeting or any adjournments
thereof.

Note: Executing this proxy permits such attorneys and proxies to vote, in their
discretion, upon such other business as may properly come before the Meeting or
any adjournments thereof.

The Board of Directors recommends a vote "FOR" the above listed
proposals.

- --------------------------------------------------------------------------------
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS
SIGNED PROXY WILL BE VOTED FOR EACH OF THE PROPOSALS STATED. IF ANY OTHER
BUSINESS IS PRESENTED AT SUCH MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED
IN THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD OF
DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE MEETING.
- --------------------------------------------------------------------------------

THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS

The undersigned acknowledges receipt from the Company prior to the
execution of this proxy of a Notice of Annual Meeting of Shareholders, a Proxy
Statement dated April 18, 2000, and the 1999 Annual Report.

Dated: , 2000
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PRINT NAME OF SHAREHOLDER PRINT NAME OF SHAREHOLDER

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SIGNATURE OF SHAREHOLDER SIGNATURE OF SHAREHOLDER

Please sign exactly as your name appears on this proxy. When signing as
attorney, executor, administrator, trustee, or guardian, please give your full
title. If shares are held jointly, each holder should sign.

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PLEASE COMPLETE, SIGN, DATE, AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PREPAID ENVELOPE.
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