Town Bank Announces Mid-Year Results

Expanding Branch Network to Cranford, N.J.


WESTFIELD, N.J., July 22, 2004 (PRIMEZONE) -- Town Bank (OTCBB:TBWN) -- To Our Shareholders, from Joseph O'Sullivan, Chairman and Robert Dowens, President:

We are pleased to advise you that we have applied to the Federal Deposit Insurance Corporation and the New Jersey Department of Banking to establish a branch office to be located at 245 North Avenue, Cranford, New Jersey. Subject to the approval of various state, federal and local agencies, we intend to construct a new full service bank branch at this highly visible corner location. We are particularly excited about this opportunity to offer the residents and small businesses in this dynamic market of Cranford and Garwood the accessibility to The Town Bank community banking concept. We will keep you informed of our progress.

For the six months ended June 30, 2004, your Bank reported net income of $537,000 or $0.29 per basic share, $0.28 per diluted share, compared to net income of $355,000 or $0.33 per basic share, $0.32 per diluted share, for the same 2003 period. For the quarter ended June 30, 2004, net income amounted to $267,000 or $0.14 per basic and diluted share compared to $211,000 or $0.19 per basic and diluted share recorded for the three months ended June 30, 2003. The change in earnings per share for both periods is the result of the private placement of common stock completed during the third quarter of 2003. The growth in net income is primarily the result of a higher level of net interest income, due to the growth of the institution.

At June 30, 2004 total assets amounted to $122,900,000 compared to $93,455,000 at June 30, 2003, a growth of $29,445,000 or 31.5%. Total deposits grew to $105,917,000 at June 30, 2004 from $83,278,000 recorded one year ago, reflecting a growth of $22,639,000 or 27.2%. Loans outstanding rose from $67,978,000 to $93,347,000 over the period, representing an increase of $25,369,000 or 37.3%.

We thank you for your ongoing support of The Town Bank, and we look forward to the future with enthusiasm and confidence.



                             The Town Bank
                             Balance Sheet
               (in thousands, except share amounts)
                             (unaudited)
                                                     June 30,
                                               2004           2003

 ASSETS

 Cash and due from banks                     $ 2,287        $ 2,033
 Federal funds sold and
   other short term investments                6,653         12,207
 Investment securities available
   for sale                                   18,906         10,046
 Loans, net of unearned fees/costs            93,347         67,978
   less: Allowance for  loan losses             (941)          (690)
                                           ---------     ----------
 Net loans                                    92,406         67,288
 Premises and equipment, net                   1,967          1,374
 Other assets                                    681            507
                                           ---------     ----------
 Total Assets                              $ 122,900       $ 93,455
                                           ---------     ----------


 LIABILITIES AND SHAREHOLDERS' EQUITY
 Liabilities
 Deposits:
   Non-interest bearing                     $ 18,184       $ 15,795
   Interest bearing                           87,733         67,483
                                            --------       --------
  Total deposits                             105,917         83,278
 Short term borrowings                           217            250
 Accrued expenses and other
   liabilities                                 3,324          3,354
                                           ---------     ----------
   Total Liabilities                         109,458         86,882
                                           ----------     ----------


 Shareholders' Equity
 Common stock ($5.00 par value per
    share, authorized 3,000,000 shares
    at June 30, 2004 and 2003;
    1,851,012 shares issued and
    outstanding at June 30, 2004 and
    1,085,613 issued and outstanding at
    June 30, 2003                              9,255          5,428
 Additional paid-in capital                    5,415          3,123
 Accumulated deficit                          (1,135)        (2,016)
 Accumulated other comprehensive
    income (loss)                                (93)            38
                                           ---------     ----------
   Total Shareholders' Equity                 13,442          6,573
                                           ---------     ----------
 Total Liabilities And Shareholders'
   Equity                                  $ 122,900       $ 93,455
                                           ---------     ----------



                             Income Statements
                (in thousands, except share amounts)
                             (unaudited)

                                            For the six months ended
                                                   June 30,
                                               2004           2003
 Interest income                             $ 2,827        $ 2,297
 Interest expense                                827            784
                                        ------------     ----------
 Net interest income                           2,000          1,513
 Provision for loan losses                       140             80
                                        ------------     ----------
 Net interest income after
   provision for loan losses                   1,860          1,433
                                        ------------     ----------
 Non interest income                              62            125
 Non interest expense                          1,350          1,165
                                        ------------     ----------
 Income before income taxes                      572            393
 Income taxes                                     35             38
                                        ------------     ----------
 Net income                                    $ 537          $ 355
                                        ============     ==========
 Net income per share
   - basic                                    $ 0.29         $ 0.33
                                        ============     ==========
 Net income per share
   -  diluted                                 $ 0.28         $ 0.32
                                        ============     ==========
 Average shares outstanding
   - basic                                 1,851,012      1,085,613
                                        ============     ==========
 Average shares outstanding
   - diluted                               1,893,842      1,108,866
                                        ============     ==========

 The above share figures have been restated for the 5% stock
 dividend distributed on June 1, 2004


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