Exhibit 99.3
PRESS RELEASE
FOR IMMEDIATE RELEASE
COMMUNITY BANK SYSTEM, INC. AND FIRST LIBERTY BANK CORP.
AGREE TO MERGE IN AN $87 MILLION EXCHANGE OF STOCK
DEWITT, N.Y. AND JERMYN, Pa., Nov. 29/PR Newswire/--
Community Bank System, Inc. (NYSE: CBU - news) and First
Liberty Bank Corp. (NASDAQ-OTC: FLIB - news) jointly announce
that they have signed a definitive agreement for CBU to acquire
all the stock of FLIB and to merge First Liberty Bank and Trust,
FLIB's principal subsidiary, into Community Bank, N.A., CBU's
banking subsidiary. First Liberty will continue to operate
under its present name in Pennsylvania as a division of
Community Bank.
CBU is a registered bank holding company with $1.9 billion
in assets, based in the Syracuse suburb of DeWitt, New York, and
FLIB is a $647 million asset bank holding company headquartered
in Jermyn, Pennsylvania. Pursuant to the definitive agreement
each share of FLIB will be exchanged on a tax-free basis for
0.56 shares of registered common stock of CBU. At CBU's closing
price on November 28 of $24.30, the shares of CBU to be received
by FLIB shareholders would have a value of $86.7 million, or
$13.61 per share, representing a price to book value of 144% and
a price/trailing earnings ratio of 17.7 times. Based on CBU's
current annualized quarterly dividend, FLIB shareholders would
realize a 37% increase in cash dividends per share. CBU will
issue approximately 3,566,000 shares in the transaction, which
will be recorded under the pooling method of accounting.
Pending approval by shareholders of both FLIB and CBU, and
after regulatory review and the satisfaction of other
contingencies, the transaction is expected to close in the
second quarter of 2001. At that time, Saul Kaplan, Peter A.
Sabia and Harold S. Kaplan, FLIB's three largest shareholders,
will become members of the CBU Board of Directors. William M.
Davis will remain as CEO of the Pennsylvania division of
Community Bank, N.A. FLIB has agreed not to solicit or pursue
other transactions, and the parties have executed an agreement
providing CBU with an option to acquire 19.9 percent of FLIB
under certain conditions.
MERGER CONSIDERATIONS:
Sanford A. Belden, President and Chief Executive Officer of
CBU, stated, "We are delighted that our first strategic
partnership outside of New York State is with such a solid,
well-established community bank as First Liberty Bank and Trust.
- First Liberty has the second largest deposit market
share, at 17 percent, in Lackawanna County, where 11 of
its 13 branches are located, bringing additional core
deposit funding capacity to our Company.
- FLIB's asset quality is superb, with a nonperforming
assets (NPA) ratio of 0.28 percent, a loan loss
reserves/NPA ratio of 300 percent, and a year-to-date
ratio of net charge offs/average loans of 0.08 percent.
- FLIB's ample capital position will significantly add to
CBU's strength, resulting in pro-forma increases to its
tangible equity/assets ratio (up 20 percent to
4.61 percent), Tier I leverage ratio (up 4 percent to
6.09 percent), and tangible book value per share (up
13 percent to $11.52).
- FLIB's commercial lending expertise, which has
capitalized on the expanding opportunities in the
greater Scranton and Wilkes-Barre markets, is expected
to be of continuing benefit to our combined operations.
- Distribution of CBU's broader range of financial
services is expected to be particularly successful in
First Liberty's market place, which is characterized by
a higher average household income and rate of growth
than its New York State markets.
- FLIB's directors and officers hold over 36 percent of
the shares outstanding, leading to increased insider
ownership for the combined company."
PROFORMA EARNINGS IMPACT:
Mr. Belden went on to say, "We expect the transaction to be
accretive to earnings per share by the end of the first
operating year.
- Plans are in place to improve efficiency by
approximately 23 percent by focusing First Liberty's
resources on the delivery of face-to-face customer
services though its branch system, commercial lending
officers, and trust personnel.
- Representatives of Community Investment Services, Inc.
(CBU's broker-dealer) will be positioned in selected
First Liberty branches, and a marketing strategy for the
sale of CBU's employee benefit trust services (Benefit
Plans Administrative Services) and investment
management services (Elias Asset Management) will be
implemented. Pro forma combined assets under management
of the two companies are $1.6 billion.
- First Liberty's investment portfolio will be
restructured at the outset and its asset/liability
management position aligned over time with CBU's
practices.
- Approximately $10.0 million in one-time pretax charges
are anticipated, including transaction and other costs."
BENEFITS TO FIRST LIBERTY BANK STAKEHOLDERS:
William M. Davis, President of FLIB stated, "Our stockholders,
customers, employees and the communities we serve all stand to
benefit from this combination of two strong banking companies.
- Stockholders will benefit from the value and liquidity
of being owners of a New York Stock Exchange-listed
company.
- Customers will have access to a more extensive set of
banking services, including Internet banking and
comprehensive cash management.
- Customers will also be able to utilize the enhanced
financial services of benefit plan administration,
investment management and insurance which the merged
company will bring to our market place.
- We will continue to leverage our strong local brand by
utilizing the First Liberty name with the same familiar
staff under the leadership of current executives in a
decentralized, localized style.
- Employees will have access to a much broader range of
banking positions and opportunities through Community
Bank's network of branches, financial service offices
and operations/administration centers.
- Eight of our current sixteen members of the Board of
Directors will serve as members of a Pennsylvania
Advisory Board, maintaining the benefit of their
continued leadership and experience, while three will
join the CBU Board."
Mr. Davis concluded, "And of personal satisfaction to me,
Community Bank shares our deep commitment to be involved in and
serve the evolving needs of the communities where we live and do
business."
CONFERENCE CALL SCHEDULED:
A conference call will be held with Company management at
10:00 a.m. (EST) on Thursday, November 30, to discuss the above
transaction at 1-877-917-6902 (password "Sanford Belden"). An
audio recording of the call will be available one hour after the
call until the close of business on December 10th, and may be
accessed at 1-888-568-0677. An investor presentation of the
proposed merger is accessible in the "What's New" section of the
"Investor Services" module of the Company's web site,
www.communitybankna.com, and will serve as the outline of the
conference call. In addition, both the call and the
presentation will be simultaneously broadcast over the Internet
by Vcall. Investors may access both the audio and visual
portions of this presentation at
http://www.vcall.com/NASApp/Vcall/EventPage?ID=56148.
First Liberty Bank Corp. (NASDAQ-OTC: FLIB) is a
registered bank holding company based in Jermyn, Pennsylvania
with $647 million in assets as of September 30, 2000. With
predecessor banks dating back to the early 1900s, the holding
company was organized in 1984 as The First Jermyn Corp. It
completed the acquisition of the $271 million asset Upper Valley
Bancorp. Inc. in 1998, and concurrently adopted its present
name. In July 2000, the Bank acquired three offices of Mellon
Bank, N.A. with approximately $39 million in deposits. It
presently operates thirteen branch offices in Lackawanna (11)
and Luzerne (2) counties in Northeastern Pennsylvania and has
16 ATMs. In addition to a full range of banking products, it
offers personal trust and employee benefit trust services with
approximately $300 million in assets under management.
Community Bank System, Inc. (CBSI) is a registered bank
holding company based in DeWitt, New York. Its wholly-owned
banking subsidiary, Community Bank N.A.
(http://www.communitybankna.com) is the fifth largest commercial
banking franchise headquartered in Upstate New York, having
67 customer facilities and 50 ATMs stretching diagonally from
Northern New York to the Southern Tier and west to Lake Erie.
Other subsidiaries within the CBSI family are Elias Asset
Management, Inc., an investment management firm with
$700 million under management, based in Williamsville, New York;
Benefit Plans Administrative Services, Inc. (BPA), a pension
administration and consulting firm located in Utica, New York,
serving sponsors of defined benefit and defined contribution
plans; Community Investment Services, Inc. (CISI), a broker-
dealer delivering financial products from selected locations
within Community Bank's branch system and from offices in
Jamestown and Lockport, New York; and Community Financial
Services, Inc. (CFSI), an insurance agency based in Olean, New
York, specializing in long-term health care and other selected
products.
This press release contains forward-looking statements
within the meaning of the Private Securities Litigation Reform
Act of 1995 with respect to the anticipated effects of the
merger. The following factors, among others, could cause the
actual results of the merger to differ materially from CBU's
expectations: the satisfaction of contingencies for closing the
merger, including regulatory and shareholder approval; the
successful integration of operations of the pending Citizens
National Bank of Malone ($115 million in assets) and Community
Bank merger as well as the subsequent consolidation with First
Liberty Bank & Trust; competition; changes in economic
conditions, interest rates and financial markets; and changes in
legislation or regulatory requirements. CBU does not assume any
duty to update forward-looking statements.
Shareholders of CBU, FLIB, and other investors are urged to
read the proxy statement/prospectus that will be included in the
registration statement on Form S-4 that CBU will file with the
SEC in connection with the merger. It will contain important
information about CBU, FLIB, the merger, the persons soliciting
proxies in the merger and their interests in the merger and
related matters. After it is filed with the SEC, the proxy
statement/prospectus will be available free of charge on the
SEC's web site (www.sec.gov). The proxy statement/prospectus
and such other documents may also be obtained from CBU or from
FLIB by directing such requests to Community Bank System, Inc.,
Attention: Ms. Kelly A. Walsh, 5790 Widewaters Parkway, DeWitt,
New York 13214, tel: (315) 445-7312 or e-mail at
[email protected]; or to First Liberty Bank and
Trust, Attention: William M. Davis, 645 Washington Avenue,
Jermyn, Pennsylvania 18433, tel: (570) 876-6518.
