FOR IMMEDIATE RELEASE
June 8, 2000
FOR FURTHER INFORMATION CONTACT:
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At Troy: At Catskill
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Daniel J. Hogarty, Jr., Chairman of the Board, Wilbur J. Cross
President & Chief Executive Officer Chairman, President & Chief Executive Officer
(518) 270-3312 (518) 943-3626, Ext. 22
Edward M. Maziejka, Jr. David J. DeLuca
Vice President & Chief Financial Officer Vice President & Chief Financial Officer
(518) 270-3274 (518) 943-3626, Ext. 53
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TROY FINANCIAL CORPORATION TO ACQUIRE
CATSKILL FINANCIAL CORPORATION
Acquisition to Further Expand Troy Financial"s Reach in the
New York Capital Region
Troy and Catskill, New York - - - June 8, 2000 - - - The Boards of
Directors of Troy Financial Corporation (Nasdaq: TRYF) and Catskill Financial
Corporation (Nasdaq: CATB) jointly announced today that they have signed a
definitive agreement by which Troy will acquire all of the outstanding shares of
Catskill Financial Corporation in a cash transaction for $23.00 per share, for a
total transaction value of approximately $90.0 million.
Catskill is the holding company of Catskill Savings Bank, a $346.1
million asset, seven office savings bank headquartered in Catskill, New York. In
the acquisition, Troy Financial Corporation, the bank holding company of The
Troy Savings Bank, will merge Catskill Savings Bank into The Troy Savings Bank,
creating a regional bank with pro forma total assets in excess of $1.2 billion,
deposits of $782.3 million and 21 full-service offices located in eight New York
counties throughout New York State"s Capital and Catskill regions.
The transaction, which has been unanimously approved by the Boards
of Directors of Troy and Catskill, is subject to Catskill shareholder and
regulatory approvals and is expected to close by the end of 2000. The
transaction will be accounted for under the purchase method of accounting.
<PAGE>
Troy Financial Corporation/Catskill Financial Corporation
Press Release
Page 2 of 3
Troy Financial Corporation expects that the one-time transaction
costs associated with this merger will be approximately $6.2 million. Troy
Financial Corporation also expects the transaction to be accretive to its
earnings by the end of the first full year of the combined operations. Troy
Financial Corporation estimates that operational efficiency, as a result of the
transaction, will produce cost savings of approximately 36 percent of Catskill"s
non interest expense. Catskill has determined to restructure a significant
portion of its securities portfolio and expects that this will reduce its fiscal
third quarter earnings by approximately $7.5 million (est).
The members of Catskill"s Board will join an Advisory Board of The
Troy Savings Bank. Also, Wilbur J. Cross, Chairman, President and Chief
Executive Officer of Catskill, will become a director of Troy Financial
Corporation, as well as The Troy Savings Bank.
Daniel J. Hogarty, Jr., Chairman, President and Chief Executive
Officer of Troy, stated that, "the acquisition is an important step forward in
Troy"s strategic plan to grow and serve the financial needs of individuals,
businesses, not-for-profit organizations, and municipal and governmental units
in and near its present locations." He further noted that, "Catskill has a
similar operating philosophy to The Troy Savings Bank, and both banks have long
and excellent records of profitable operations from serving their customers."
Hogarty also stated that, "increasing our service capabilities in a new market
with an established and highly regarded community bank is a significant
opportunity and reflects the continued commitment by Troy to enhance shareholder
returns."
Wilbur J. Cross, Chairman, President and Chief Executive Office of
Catskill, said "we are very pleased with what this transaction means for our
shareholders, our customers, and the communities we serve. With this merger,
Troy will acquire the leading bank franchise in Greene County. This transaction
represents an excellent opportunity for our shareholders as the cash price is
equivalent to 1.5 times Catskill"s March 31, 2000 book value and 19.3 times the
latest 12 months earnings."
President Cross further noted that, "Catskill has aligned itself
with a company that supports our belief in community banking and its values to
customers, employees, and the communities its serves. Further, Catskill"s
customers will enjoy the delivery of additional competitive products and
services such as insurance, leasing, investment, and trust services. Troy also
brings a commitment to serving businesses through its lending and deposit
offerings, as well as all its service to municipalities through its newly formed
commercial bank, The Troy Commercial Bank."
In connection with the definitive agreement, Catskill granted Troy
an option to purchase up to 19.9 percent of its outstanding common stock.
Founded in 1823, Troy Savings is the oldest state chartered savings
bank in New York. The Bank has 14 offices serving six New York counties -
Albany, Saratoga, Schenectady, Warren, Washington and Rensselaer. The Troy
Savings Bank has been and continues to be a community-based, full-service
financial services organization offering a wide variety of business and consumer
banking products and services. The Bank and its subsidiaries also offer a full
range of trust, insurance, and investment services.
This document does not constitute an offer to purchase any
securities. Before making any decision with respect to the proposed acquisition,
Catskill stockholders will be provided with a proxy statement describing the
transaction, and matters related thereto. All such stockholders should read the
proxy statement before making any investment decision.
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Troy Financial Corporation/Catskill Financial Corporation
Press Release
Page 3 of 3
Catskill, its officers, directors, employees and agents may be
soliciting proxies from Catskill shareholders in connection with the
acquisition. Information concerning the participants in the solicitation will be
set forth in the proxy statement to be filed by Catskill with the SEC.
Investors will be able to obtain the document free of charge at the
SEC"s web page, www.sec.gov. In addition, documents filed with the SEC by
Catskill will be available without charge from the Secretary of Catskill, David
L. Guldenstern, telephone (518) 943-3600.
READ THE PROXY STATEMENT CAREFULLY BEFORE MAKING A DECISION CONCERNING THE
MERGER.
Forward-looking statements
The statements contained in this press release that are
forward-looking are based on current expectations that are subject to a number
of uncertainties and risks, and actual results may differ materially. These
forward-looking statements are not guarantees of future performance and are
subject to risks and uncertainties that could cause actual results to differ
materially from the results contemplated by the forward-looking statements.
These risks and uncertainties include, but are not limited to:
- the possibility that the anticipated benefits from the proposed
acquisition transaction will not be fully realized; - the possibility
that costs or difficulties related to our integration the proposed
acquisition will be greater than expected; - other risk factors as may
be detailed from time-to-time in our public announcements and filings
with the SEC, including our annual report on Form 10-K for the
year ended September 30, 1999.
In addition, nothing in the press release should be viewed as an update
or comment on earlier forward-looking statements provided by Troy Financial
Corporation. Because actual results, performance or developments may differ
materially from forward-looking statements, Troy will not update such statements
over the course of the future periods.
