News Details

Peapack-Gladstone Financial Corporation Reports First Quarter Results of Operations

April 27, 2010

GLADSTONE, N.J.--(BUSINESS WIRE)-- Peapack-Gladstone Financial Corporation (NASDAQ Global Select Market:PGC) (the Corporation) recorded net income of $2.1 million and diluted earnings per common share of $0.16, for the quarter ended March 31, 2010. These results compared to net income of $1.4 million and diluted earnings per common share of $0.11 for the quarter ended December 31, 2009. Net income and diluted earnings per share for the quarter ended March 31, 2009 were $2.5 million and $0.26, respectively.

When compared to the quarter ended December 31, 2009, the quarter ended March 31, 2010 included an increase in net interest income and trust fees and other income and a decrease in the provision for loan losses. These positive effects were partially offset, with respect to diluted earnings per share, by an increase in preferred dividends and accretion, due to the January 6, 2010 partial redemption of the preferred shares previously issued under the U.S. Treasury's Capital Purchase Program ("CPP").

When compared to the March 2009 quarter, the March 2010 quarter included a greater provision for loan losses, additional expenses partially due to two new locations opened in 2009, and, with respect to diluted earnings per share, an increase in preferred dividends and accretion, due to the January 2010 partial redemption of the CPP. The effects of these were partially offset by increased net interest income and increased trust fees and other noninterest income in the 2010 period.

Frank A. Kissel, Chairman and CEO, stated, "We are pleased to once again report positive earnings and generate capital in excess of common and preferred dividends, as we have throughout 2009, despite the significant impact the recession has had on financial institutions and their borrowers. This internal capital generation enabled us to redeem 25 percent of the preferred shares issued previously under the CPP." Mr. Kissel continued, "Building capital internally, remaining well capitalized and redeeming the Treasury's CPP investment over time continue to be important business objectives of the Corporation."

The Corporation's provision for loan losses increased substantially throughout 2009 starting at $2.0 million for the quarter ended March 31, 2009 and reaching its highest quarterly level of $3.0 million for the quarter ended December 31, 2009, as the continued weakness in the overall economy and in the real estate markets negatively impacted our borrowers and their property values, causing an increase in problem loans. Mr. Kissel noted "the provision for loan losses for the first quarter of 2010 was lower than the level for the fourth quarter of 2009 and it still contributed to an overall increase in the allowance for loan losses from $13.2 million or 1.34 percent of loans at December 31, 2009 to $13.7 million or 1.41 percent of loans at March 31, 2010".

Mr. Kissel continued "We have not seen the same significant deterioration in our loan portfolio as many other institutions have because of our conservative underwriting at the time of origination and our continued diligence in managing our loan portfolio. Further, we are pleased with the progress we have made over the past several quarters in resolving certain problem assets."

Net Interest Income and Margin

In the first quarter of 2010, net interest income, on a fully tax-equivalent basis, was $12.7 million, reflecting an increase from $12.4 million for the fourth quarter of 2009, as well as an increase from the $12.1 million for the first quarter of 2009. On a fully tax-equivalent basis, the net interest margin was 3.67 percent for the March 2010 quarter, 3.44 percent for the December 2009 quarter and 3.70 percent for the March 2009 quarter.

The intentional run-off of higher cost certificates of deposit and the growth of core deposits, coupled with a reduction in cash balances contributed to the increased margin in the first quarter of 2010 when compared to the fourth quarter of 2009.

In comparing the March 2010 quarter to the same quarter last year, the effect of growth in lower yielding, but less risky and shorter duration cash deposits and investment securities coupled with declining loan balances, contributed to the reduced margin. Mr. Kissel stated, "We have built substantial short and medium-term liquidity into our balance sheet over the last several quarters, so as to be better positioned in the future when we expect loan demand will increase and interest rates will rise."

Loans

Average loans totaled $978.5 million for the first quarter of 2010 as compared to $1.05 billion for the same 2009 quarter, reflecting a decrease of $69.4 million or 6.6 percent. The average residential mortgage loan portfolio declined $52.5 million or 10.5 percent to $449.4 million from the same quarter of 2009, as the Corporation has opted to sell its longer-term, fixed-rate loan production as an interest rate risk management strategy in the lower rate environment and loan payments have outpaced originations retained in portfolio. The average commercial portfolio declined $18.2 million or 12.9 percent to $122.7 million, as loan demand and quality borrowers on the commercial front have remained scarce.

The average home equity line portfolio rose $7.0 million or 21.7 percent to $39.1 million for the first quarter of 2010 compared to the same quarter in 2009. The Corporation focused on the origination of these adjustable-rate loans, and loan originations outpaced principal paydowns over the year.

Deposits

Average total deposits (interest-bearing and noninterest-bearing) grew 6.9 percent from $1.24 billion in the first quarter of 2009 to $1.32 billion in the first quarter of 2010. Average noninterest-bearing checking grew $15.9 million or 8.3 percent to $208.0 million in the first quarter of 2010 from the first quarter of 2009. Average interest-bearing checking balances totaled $238.3 million in the first quarter of 2010, rising $70.2 million or 41.8 percent from the same quarter in 2009. Checking growth is attributable to the Corporation's focus on core deposit growth, particularly checking, coupled with growth in the Ultimate Checking product, which provides customers with a low-cost checking product and a higher yield for larger balances.

Average money market accounts also rose, from $381.5 million in the first quarter of 2009 to $494.7 million for the same quarter of 2010, an increase of $113.1 million or 29.7 percent. The Corporation's focus on core deposit growth, as well as certain customers tending to "park" funds in money market accounts in lower interest rate environments accounted for this growth.

In comparing balances at March 31, 2010 to balances at December 31, 2009, noninterest-bearing checking, savings and money market accounts have continued to increase, while higher costing certificates of deposit and interest-bearing checking have declined. The Corporation has opted not to pay above market rates on maturing certificates of deposit, as the Corporation has ample liquidity from core deposit growth and principal paydowns on loans.

Mr. Kissel commented, "Our continued core deposit growth and reduced reliance on certificates of deposit continues to strengthen our customer relationships, reduce our overall cost of funds, contribute to our profitability and enhance the value of our franchise."

PGB Trust and Investments

PGB Trust and Investments generated $2.4 million in fee income in the first quarter of 2010, compared to $2.3 million in both the December 2009 quarter and the March 2009 quarter. The market value of the assets under administration of the Trust Division increased from $1.60 billion at March 31, 2009 to $1.89 billion at March 31, 2010.

Craig C. Spengeman, President of PGB Trust & Investments commented, "We are pleased with the recovery and performance of our assets under administration throughout 2009 and into 2010 as the financial markets have been enduring the worst financial crisis since the Great Depression. The recovery and performance reflects the sound financial management of our trust and investment professionals as well as the quality of new business booked as prospective clients continue to seek professional advice during these challenging times."

Other Income

For the first quarter of 2010, other income totaled $1.1 million compared to the same amount for the December 2009 quarter and compared to $983 thousand for the first quarter of 2009. Fee income earned on the sale of mortgage loans at origination increased $84 thousand to $177 thousand in the first quarter of 2010 from $93 thousand in the same 2009 period. The increase for 2010 resulted from greater longer-term, fixed-rate mortgage originations, which are sold, as well as a greater targeted sale price for such originations.

Operating Expenses

The Corporation's total operating expenses were $10.5 million for the March 2010 quarter compared to $10.6 million in the December 2009 quarter and compared to $9.5 million for the March 2009 quarter. The increase for 2010, when compared to the year ago quarter, was principally due to expenses associated with a new Trust office opened in June 2009 and a new branch office opened in September 2009, increased expenses related to problem loans and REO, and an increase in FDIC insurance due to an industry-wide increase in the FDIC assessment rates.

ASSET QUALITY

At March 31, 2010, nonperforming assets increased slightly to $12.9 million or 0.87 percent of total assets as compared to $12.1 million or 0.80 percent of total assets at December 31, 2009. Mr. Kissel noted, "We continue to be proactive in our loan portfolio management in an effort to identify and stay ahead of potential problems. We are well capitalized and we are ready to lend to well-qualified individuals and businesses. However, we remain committed to our conservative underwriting standards that have served us well in the past and which we believe will continue to serve us well in the future."

The allowance for loan losses was $13.7 million or 1.41 percent of total loans at March 31, 2010 as compared to $13.2 million or 1.34 percent of total loans at December 31, 2009.

CAPITAL

At March 31, 2010, the Corporation's leverage ratio, tier 1 and total risk based capital ratios were 7.80 percent, 12.01 percent and 13.27 percent, respectively. All ratios are above the levels necessary to be considered well capitalized under applicable regulatory guidelines, despite the $7.2 million reduction in regulatory capital due to the partial redemption of the preferred shares previously issued under the CPP. Additionally, the Corporation's common equity ratio (common equity to total assets) at March 31, 2010 stands at 6.29 percent.

As previously announced, on April 15, 2010 the Board of Directors declared a regular cash dividend of $0.05 per share payable on May 13, 2010 to shareholders of record on April 29, 2010.

ABOUT THE CORPORATION

Peapack-Gladstone Financial Corporation is a bank holding company with total assets of $1.48 billion as of March 31, 2010. Peapack-Gladstone Bank, its wholly owned community bank, was established in 1921, and has 24 branches in Somerset, Hunterdon, Morris, Middlesex and Union Counties. Its Trust Division, PGB Trust and Investments, operates at the Bank's main office located at 190 Main Street in Gladstone and at four other locations in Clinton, Morristown and Summit, New Jersey and Bethlehem, Pennsylvania. To learn more about Peapack-Gladstone Financial Corporation and its services please visit our web site at www.pgbank.com or call 908-234-0700.

The foregoing contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about management's confidence and strategies and management's expectations about new and existing programs and products, investments, relationships, opportunities and market conditions. These statements may be identified by such forward-looking terminology as "expect", "look", "believe", "anticipate", "may", or similar statements or variations of such terms. Actual results may differ materially from such forward-looking statements. Factors that may cause results to differ materially from such forward-looking statements include, but are not limited to

    --  a continued or unexpected decline in the economy, in particular in our
        New Jersey market area;
    --  declines in value in our investment portfolio;
    --  higher than expected increases in our allowance for loan losses;
    --  increases in loan losses or in the level of nonperforming loans;
    --  unexpected changes in interest rates;
    --  we may be unable to successfully grow our business;
    --  we may be unable to manage our growth;
    --  a continued or unexpected decline in real estate values within our
        market areas;
    --  increased or unexpected competition from our competitors;
    --  significant regulatory oversight which may adversely affect our
        business;
    --  higher than expected FDIC insurance premiums;
    --  lack of liquidity to fund our various cash obligations;
    --  repurchase of our preferred shares issued under the Treasury's Capital
        Purchase Program which will impact net income available to our common
        shareholders and our earnings per share;
    --  further offerings of our equity securities may result in dilution of our
        common stock;
    --  reduction in our lower-cost funding sources;
    --  changes in accounting policies or accounting standards;
    --  we may be unable to adapt to technological changes;
    --  our internal controls and procedures may not be adequate;
    --  claims and litigation pertaining to fiduciary responsibility,
        environmental laws and other matters;
    --  future earnings volatility caused by economic or other factors; and
    --  other unexpected material adverse changes in our operations or earnings.

A discussion of these and other factors that could affect our results is included in our SEC filings, including our Annual Report on Form 10-K for the year ended December 31, 2009. We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in the Corporation's expectations.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

PEAPACK-GLADSTONE FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CONDITION

(Dollars in thousands)

(Unaudited)

                  As of

                    March 31,    December     September    June 30,     March 31,
                                 31,          30,

                    2010         2009         2009         2009         2009

ASSETS

Cash and due      $ 8,999      $ 7,864      $ 9,343      $ 50,921     $ 20,525
from banks

Federal funds       201          201          200          200          201
sold

Interest-earning    33,915       71,907       46,876       513          59,063
deposits

Total cash and      43,115       79,972       56,419       51,634       79,789
cash equivalents

Securities held     105,258      89,459       86,703       77,216       48,379
to maturity

Securities
available for       278,052      272,484      252,786      227,414      178,676
sale

FHLB and FRB        5,305        5,315        5,329        5,343        4,202
Stock, at cost

Residential         443,085      452,641      466,601      483,330      494,208
mortgage

Commercial          281,323      279,595      279,336      275,915      275,675
mortgage

Commercial loans    133,288      120,554      129,671      133,659      137,304

Construction        48,044       64,816       65,760       67,075       69,474
loans

Consumer loans      24,936       25,638       26,571       27,302       27,959

Home equity         39,487       38,728       38,450       35,357       32,648
lines of credit

Other loans         902          1,565        1,592        1,079        1,958

Total loans         971,065      983,537      1,007,981    1,023,717    1,039,226

Less: Allowance     13,720       13,192       12,947       11,054       9,762
for loan losses

Net loans           957,345      970,345      995,034      1,012,663    1,029,464

Premises and        27,942       27,911       28,011       27,189       26,740
equipment

Other real          40           360          680          700          965
estate owned

Accrued interest    5,112        4,444        5,359        4,652        4,635
receivable

Bank owned life     26,473       26,292       26,087       25,865       25,672
insurance

Deferred tax        23,999       23,522       22,154       23,653       22,927
assets, net

Other assets        10,670       12,249       9,117        2,550        2,858

TOTAL ASSETS      $ 1,483,311  $ 1,512,353  $ 1,487,679  $ 1,458,879  $ 1,424,307

LIABILITIES

Deposits:

Noninterest
bearing demand    $ 223,184    $ 216,127    $ 199,804    $ 194,888    $ 195,175
deposits

Interest-bearing
deposits

Checking            241,887      255,058      212,687      203,378      178,430

Savings             77,064       73,866       73,308       71,464       70,426

Money market        502,548      458,303      470,123      418,208      400,692
accounts

CD's $100,000       109,347      147,138      159,942      187,516      192,708
and over

CD's less than      173,219      199,177      209,994      220,779      225,608
$100,000

Total deposits      1,327,249    1,349,669    1,325,858    1,296,233    1,263,039

Borrowings          36,140       36,499       36,815       37,128       39,439

Other               5,998        6,676        5,862        9,844        7,654
liabilities

TOTAL               1,369,387    1,392,844    1,368,535    1,343,205    1,310,132
LIABILITIES

Shareholders'       113,924      119,509      119,144      115,674      114,175
Equity

TOTAL
LIABILITIES AND   $ 1,483,311  $ 1,512,353  $ 1,487,679  $ 1,458,879  $ 1,424,307
SHAREHOLDERS'
EQUITY

Trust division
assets under
management        $ 1,894,971  $ 1,856,229  $ 1,803,862  $ 1,702,782  $ 1,602,752
(market value,
not included
above)



PEAPACK-GLADSTONE FINANCIAL CORPORATION

SELECTED BALANCE SHEET DATA

(Dollars in thousands)

(Unaudited)

               As of

                 March 31,    December 31,    September    June 30,    March 31,
                                              30,

                 2010         2009            2009         2009        2009

Asset
Quality:

Loans past
due over 90
days and       $ 638        $ 496           $ 1,118      $ 104       $ -
still
accruing

Nonaccrual       12,200       11,256          13,082       12,998      11,139
loans

Other real       40           360             680          700         965
estate owned

Total
nonperforming  $ 12,878     $ 12,112        $ 14,880     $ 13,802    $ 12,104
assets

Nonperforming
loans to         1.32   %     1.19   %        1.41   %     1.28   %    1.07   %
total loans

Nonperforming
assets to        0.87   %     0.80   %        1.00   %     0.95   %    0.85   %
total assets

Troubled debt
restructured   $ 11,817     $ 11,123        $ 18,671     $ 7,766     $ -
loans

Loans past
due 30
through 89     $ 10,056     $ 6,015         $ 7,362      $ 5,524     $ 8,458
days and
still
accruing

Allowance for
loan losses:

Beginning of   $ 13,192     $ 12,947        $ 11,054     $ 9,762     $ 9,688
period

Provision for    2,400        2,950           2,750        2,000       2,000
loan losses

Charge-offs,     (1,872 )     (2,705 )        (857   )     (708   )    (1,926 )
net

End of period  $ 13,720     $ 13,192        $ 12,947     $ 11,054    $ 9,762

ALLL to
nonperforming    106.87 %     112.25 %        91.18  %     84.37  %    87.64  %
loans

ALLL to total    1.41   %     1.34   %        1.28   %     1.08   %    0.94   %
loans

Capital
Adequacy:

Tier I
leverage

(5% minimum
to be
considered       7.80   %     7.93   %        8.17   %     8.25   %    8.21   %
well
capitalized)

Tier I
capital to
risk-weighted
assets

(6% minimum
to be
considered       12.01  %     12.45  %        12.23  %     12.30  %    11.73  %
well
capitalized)

Tier I & II
capital to
risk-weighted
assets

(10% minimum
to be
considered       13.27  %     13.71  %        13.48  %     13.44  %    12.73  %
well
capitalized)

Common equity
to Total         6.29   %     6.09   %        6.17   %     6.06   %    6.11   %
assets

Book value
per Common     $ 10.70      $ 10.57         $ 10.54      $ 10.15     $ 9.99
share



PEAPACK-GLADSTONE FINANCIAL CORPORATION

SELECTED CONSOLIDATED FINANCIAL DATA

(Dollars in thousands, except share data)

(Unaudited)

              For The Three Months Ended

                March 31,    December 31,    September    June 30,    March 31,
                                             30,

                2010         2009            2009         2009        2009

Income
Statement
Data:

Interest      $ 15,791     $ 16,123        $ 16,379     $ 16,709    $ 16,795
income

Interest        3,243        4,000           4,129        4,543       4,987
expense

Net interest    12,548       12,123          12,250       12,166      11,808
income

Provision
for loan        2,400        2,950           2,750        2,000       2,000
losses

Net interest
income after
provision       10,148       9,173           9,500        10,166      9,808
for loan
losses

Trust fees      2,364        2,346           2,200        2,550       2,332

Other income    1,108        1,067           1,137        1,114       983

Securities      -            (42    )        (2     )     108         5
gains, net

Salaries and
employee        5,709        5,291           5,622        5,430       5,534
benefits

Premises and    2,372        2,358           2,185        2,171       2,089
equipment

FDIC
insurance       586          834             724          1,378       373
expense

Other           1,863        2,124           2,409        2,216       1,528
expenses

Income
before          3,090        1,937           1,895        2,743       3,604
income taxes

Income tax      965          536             583          813         1,122
expense

Net income      2,125        1,401           1,312        1,930       2,482

Dividends
and
accretion on    710          430             430          428         205
preferred
stock

Net income
available to  $ 1,415      $ 971           $ 882        $ 1,502     $ 2,277
Common
shareholders

Per Common
Share Data:

Earnings per
share         $ 0.16       $ 0.11          $ 0.10       $ 0.17      $ 0.26
(basic)

Earnings per
share           0.16         0.11            0.10         0.17        0.26
(diluted)

Performance
Ratios:

Return on
Average         0.58   %     0.37   %        0.36   %     0.54   %    0.71   %
Assets

Return on
Average         6.10   %     4.18   %        3.89   %     6.75   %    10.45  %
Common
Equity

Net Interest
Margin

(Taxable
Equivalent      3.67   %     3.44   %        3.61   %     3.71   %    3.70   %
Basis)

Note: Per share amounts have been restated for a 5% stock dividend declared on
June 18, 2009, and payable on August 3, 2009 to shareholders of record on July
9, 2009.



PEAPACK-GLADSTONE FINANCIAL CORPORATION

SELECTED CONSOLIDATED FINANCIAL DATA

(Dollars in thousands, except share data)

(Unaudited)

                                                     For The

                                                     Three Months Ended

                                                     March 31,

                                                       2010        2009

Income Statement Data:

Interest income                                      $ 15,791    $ 16,795

Interest expense                                       3,243       4,987

Net interest income                                    12,548      11,808

Provision for loan losses                              2,400       2,000

Net interest income after provision for loan losses    10,148      9,808

Trust fees                                             2,364       2,332

Other income                                           1,108       983

Securities gains, net                                  -           5

Salaries and employee benefits                         5,709       5,534

Premises and equipment                                 2,372       2,089

FDIC insurance expense                                 586         373

Other expenses                                         1,863       1,528

Income before income taxes                             3,090       3,604

Income tax expense                                     965         1,122

Net income                                             2,125       2,482

Dividends and accretion on preferred stock             710         205

Net income available to Common shareholders          $ 1,415     $ 2,277

Per Common Share Data:

Earnings per share (basic)                           $ 0.16      $ 0.26

Earnings per share (diluted)                           0.16        0.26

Performance Ratios:

Return on Average Assets                               0.58   %    0.71   %

Return on Average Common Equity                        6.10   %    10.45  %

Net Interest Margin

(Taxable Equivalent Basis)                             3.67   %    3.70   %

Note: Per share amounts have been restated for a 5% stock dividend declared
on June 18, 2009, and payable on August 3, 2009 to shareholders of record
on July 9, 2009.



PEAPACK-GLADSTONE FINANCIAL CORPORATION

AVERAGE BALANCE SHEET

UNAUDITED

THREE MONTHS ENDED

(Tax-Equivalent Basis, Dollars in Thousands)

                     March 31, 2010                    March 31, 2009

                       Average        Income/            Average        Income/

                       Balance        Expense  Yield     Balance        Expense  Yield

ASSETS:

Interest-Earning
Assets:

Investments:

Taxable (1)          $ 325,379      $ 2,511    3.09 %  $ 179,304      $ 2,139    4.77 %

Tax-Exempt (1) (2)     37,800         450      4.76      49,976         653      5.24

Loans (2) (3)          978,470        12,994   5.31      1,047,911      14,258   5.44

Federal Funds Sold     201            -        0.20      200            -        0.20

Interest-Earning       44,591         24       0.21      28,054         9        0.13
Deposits

Total
Interest-Earning       1,386,441    $ 15,979   4.61 %    1,305,445    $ 17,059   5.23 %
Assets

Noninterest-Earning
Assets:

Cash and Due from      8,334                             19,697
Banks

Allowance for Loan     (13,773   )                       (9,612    )
Losses

Premises and           27,992                            26,854
Equipment

Other Assets           68,845                            54,654

Total
Noninterest-Earning

Assets                 91,398                            91,593

Total Assets         $ 1,477,839                       $ 1,397,038

LIABILITIES:

Interest-Bearing
Deposits

Checking             $ 238,285      $ 407      0.68 %  $ 168,041      $ 297      0.71 %

Money Markets          494,670        1,118    0.90      381,532        1,171    1.23

Savings                75,186         77       0.41      68,087         78       0.46

Certificates of        305,654        1,317    1.72      427,011        3,090    2.89
Deposit

Total
Interest-Bearing       1,113,795      2,919    1.05      1,044,671      4,636    1.78
Deposits

Borrowings             36,290         324      3.57      41,646         351      3.37

Total
Interest-Bearing       1,150,085      3,243    1.13      1,086,317      4,987    1.84
Liabilities

Noninterest Bearing
Liabilities

Demand Deposits        208,044                           192,166

Accrued Expenses
and Other              6,087                             6,729
Liabilities

Total
Noninterest-Bearing    214,131                           198,895
Liabilities

Shareholders'          113,623                           111,826
Equity

Total Liabilities
and Shareholders'    $ 1,477,839                       $ 1,397,038
Equity

Net Interest Income                 $ 12,736                          $ 12,072

Net Interest Spread                            3.48 %                            3.39 %

Net Interest Margin                            3.67 %                            3.70 %
(4)



PEAPACK-GLADSTONE FINANCIAL CORPORATION

AVERAGE BALANCE SHEET

UNAUDITED

THREE MONTHS ENDED

(Tax-Equivalent Basis, Dollars in Thousands)

                     March 31, 2010                    December 31, 2009

                       Average        Income/            Average        Income/

                       Balance        Expense  Yield     Balance        Expense  Yield

ASSETS:

Interest-Earning
Assets:

Investments:

Taxable (1)          $ 325,379      $ 2,511    3.09 %  $ 304,301      $ 2,506    3.29 %

Tax-Exempt (1) (2)     37,800         450      4.76      47,749         578      4.83

Loans (2) (3)          978,470        12,994   5.31      996,601        13,232   5.31

Federal Funds Sold     201            -        0.20      201            -        0.20

Interest-Earning       44,591         24       0.21      90,663         47       0.21
Deposits

Total
Interest-Earning       1,386,441    $ 15,979   4.61 %    1,439,515    $ 16,363   4.55 %
Assets

Noninterest-Earning
Assets:

Cash and Due from      8,334                             9,493
Banks

Allowance for Loan     (13,773   )                       (12,872   )
Losses

Premises and           27,992                            27,981
Equipment

Other Assets           68,845                            61,689

Total
Noninterest-Earning    91,398                            86,291
Assets

Total Assets         $ 1,477,839                       $ 1,525,806

LIABILITIES:

Interest-Bearing
Deposits

Checking             $ 238,285      $ 407      0.68 %  $ 226,851      $ 426      0.75 %

Money Markets          494,670        1,118    0.90      469,635        1,103    0.94

Savings                75,186         77       0.41      72,326         76       0.42

Certificates of        305,654        1,317    1.72      381,984        2,062    2.16
Deposit

Total
Interest-Bearing       1,113,795      2,919    1.05      1,150,796      3,667    1.27
Deposits

Borrowings             36,290         324      3.57      36,605         333      3.64

Total
Interest-Bearing       1,150,085      3,243    1.13      1,187,401      4,000    1.35
Liabilities

Noninterest Bearing
Liabilities

Demand Deposits        208,044                           209,458

Accrued Expenses
and Other              6,087                             8,676
Liabilities

Total
Noninterest-Bearing    214,131                           218,134
Liabilities

Shareholders'          113,623                           120,271
Equity

Total Liabilities
and Shareholders'    $ 1,477,839                       $ 1,525,806
Equity

Net Interest Income                 $ 12,736                          $ 12,363

Net Interest Spread                            3.48 %                            3.20 %

Net Interest Margin                            3.67 %                            3.44 %
(4)



(1)  Average balances for available-for sale securities are based on amortized
     cost.

(2)  Interest income is presented on a tax-equivalent basis using a 35 percent
     federal tax rate.

(3)  Loans are stated net of unearned income and include nonaccrual loans.

(4)  Net interest income on a tax-equivalent basis as a percentage of total
     average interest-earning assets.



    Source: Peapack-Gladstone Financial Corporation
Contact: Peapack-Gladstone Financial Corporation Jeffrey J. Carfora, 908-719-4308 EVP and CFO