FOR IMMEDIATE RELEASE

Contact:
Robert J. Brittain, President & C.E.O.
Telephone: (518)842-7200
Fax: (518)842-7500

Harold A. Baylor, Jr., Vice President & Treasurer
Telephone: (518)842-1445
Fax: (518)843-5501

  AMBANC HOLDING CO., INC. ANNOUNCES THE SALE OF LOANS AND FORECLOSED REAL
               ESTATE AND INCREASED PROVISIONS FOR LOAN LOSSES

Amsterdam,  N.Y.,  December 23, 1996 -- Robert J. Brittain,  President and Chief
Executive  Officer of Ambanc Holding Co., Inc. (NASDAQ:  AHCI),  today announced
that the Company's subsidiary,  Amsterdam Savings Bank, F.S.B., has entered into
agreements  with  investors  for the sale of  certain  of the  Bank's  loans and
foreclosed  real estate for  approximately  $20.2  million,  at an average sales
price which represents approximately 74 % of the book value of the sold assets .
In addition,  Brittain  announced that the Bank also increased its provision for
loan losses relating to its lending  relationship with the Bennett Funding Group
by $1.3 million, bringing the provision-to-date to $2.8 million, on a total loan
exposure of $3.6 million.  The Bank has taken a total  provision for loan losses
for the fourth quarter of 1996 of approximately  $6.8 million as a result of the
loan  sales,  the  additional  provision  related to Bennett and its most recent
review of the loan portfolio, which is performed on a regular basis.

In making the announcement,  Mr. Brittain  commented,  "While these actions will
result in a charge to  earnings  and a loss for both the fourth  quarter of 1996
and for the full-year of 1996, by selling the selected loans and foreclosed real
estate,  the long-term benefits that should accrue from the sales will be in the
best interests of the Company and its shareholders and, therefore,  outweigh the
one-time   charge   to   earnings.   It   substantially   reduces   the   Bank's
quality-of-assets  problem  at a  reasonable  cost  and  creates  the  strategic
flexibility so necessary for any business in today's highly competitive economic
environment.  As we go forward,  the investment  return from the proceeds of the
sales will result in positive contributions to earnings."

Mr. Brittain stated further, "As a result of these actions, our balance sheet is
substantially  improved and the  transactions  are major steps in returning  the
Bank to full  financial  strength.  We have  been  severely  handicapped  by our
non-performing   assets  (NPAs).  They  have  limited  our  earnings,   required
significant maintenance, and raised concerns from analysts and shareholders.  We
have  monitored  the bulk  sale  market  and now  believe  that it has  improved
sufficiently  to warrant  the  decision  to sell in bulk  versus  continuing  to
resolve the problems on an asset-specific basis. We expect future quarters to be
more profitable than they would have been without the sales. Additionally,  with
these  transactions,  a considerable  portion of the expense drag of the NPAs is
behind us." 

Mr.  Brittain  pointed out that the sales achieve a meaningful  reduction in the
level of credit  risk in the Bank's  portfolio.  As a result of the  sales,  the
Bank's  non-performing assets will be reduced to approximately $4.0 million from
approximately  $18.0 million at September 30, 1996,  thereby reducing the Bank's
ratio of non-performing assets to total assets to approximately 0.80% from 3.63%
at September 30, 1996.

At September 30, 1996,  Ambanc  Holding Co.,  Inc.,  which operates nine banking
locations in the Capital Region of upstate New York through its subsidiary bank,
had total assets of $496.5 million.

                                      -END-