YARDVILLE NATIONAL BANCORP, DEF 14A, 2000-04-11

YARDVILLE NATIONAL BANCORP
DEF 14A, 2000-04-11
NATIONAL COMMERCIAL BANKS

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<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant /X/
Filed by a Party other than the Registrant / /

Check the appropriate box:

/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12

YARDVILLE NATIONAL BANCORP
- -----------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)

-----------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

1) Title of each class of securities to which transaction applies:

----------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:

----------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:

----------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:

----------------------------------------------------------------------

5) Total fee paid:

----------------------------------------------------------------------

/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

1) Amount Previously Paid:

___________________________________________________________________________
2) Form, Schedule or Registration Statement No.:

___________________________________________________________________________
3) Filing Party:

___________________________________________________________________________
4) Date Filed:

___________________________________________________________________________

<PAGE>

YARDVILLE NATIONAL BANCORP
2465 Kuser Road
Hamilton, New Jersey 08690

April 10, 2000

To Our Shareholders:

You are cordially invited to attend the Annual Meeting of Shareholders of
Yardville National Bancorp to be held on Tuesday, May 2, 2000 at 10:00 a.m. at
La Villa Ristorante, 2275 Kuser Road, Hamilton, New Jersey.

At this meeting of the Company, shareholders will be asked to elect four
directors to the Company's Board of Directors to serve until the expiration of
their terms and thereafter until their successors shall have been duly elected
and shall have qualified.

In addition, shareholders will be asked to consider the adoption of an
amendment to the 1997 Stock Option Plan increasing the number of shares of the
Company's common stock that may be issued pursuant to the plan from 410,000
shares to 1,070,000 shares.

During the meeting, we will also report on the operations of the Company.
Directors and officers of the Company will be present to respond to any
questions you may have.

The Company has scheduled a continental breakfast for shareholders
immediately preceding the meeting.

Whether or not you plan to be at the meeting, please be sure to complete,
sign and return the proxy card enclosed with this Proxy Statement, so that your
shares may be voted in accordance with your wishes.

Very truly yours,

PATRICK M. RYAN
President and Chief Executive Officer
<PAGE>

YARDVILLE NATIONAL BANCORP
2465 Kuser Road
Hamilton, New Jersey 08690

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 2, 2000

Notice is hereby given that the Annual Meeting of Shareholders of
Yardville National Bancorp (the "Company") will be held at La Villa Ristorante,
2275 Kuser Road, Hamilton, New Jersey on May 2, 2000 at 10:00 a.m. for the
purpose of considering and voting upon the following matters:

1. The election of the four persons named in the accompanying Proxy
Statement to serve as directors of the Company until the expiration of their
terms and thereafter until their successors shall have been duly elected and
shall have qualified.

2. Approving an amendment to the 1997 Stock Option Plan (the "1997 Plan")
increasing the number of shares of the Company's common stock that may be
issued pursuant to the 1997 Plan from 410,000 shares to 1,070,000 shares.

3. Such other business as shall properly come before the meeting.

Shareholders of record at the close of business on March 24, 2000 are
entitled to notice of and to vote at the meeting. Whether or not you
contemplate attending the meeting, we request that the enclosed proxy be
executed and returned to the Company. You may revoke your proxy at any time
prior to the exercise of the proxy by delivering to the Company a later dated
proxy or by delivering a written notice of revocation to the Company at or
prior to the meeting.

By Order of the Board of
Directors

STEPHEN F. CARMAN, Secretary

April 10, 2000

IMPORTANT -- PLEASE MAIL YOUR PROXY PROMPTLY
<PAGE>

YARDVILLE NATIONAL BANCORP
2465 Kuser Road
Hamilton, New Jersey 08690

PROXY STATEMENT
DATED APRIL 10, 2000

GENERAL PROXY STATEMENT INFORMATION

This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Yardville National Bancorp (the "Company") of proxies
for use at the Annual Meeting of Shareholders of the Company (the "Annual
Meeting") to be held at La Villa Ristorante, 2275 Kuser Road, Hamilton, New
Jersey on Tuesday May 2, 2000, or such later date to which the Annual Meeting
may be adjourned or postponed. This Proxy Statement is first being mailed to
shareholders on approximately April 10, 2000.

If a shareholder is participating in the Company's Dividend Reinvestment
and Stock Purchase Plan (the "Dividend Reinvestment Plan"), the shareholder
will receive a single proxy covering both the shares of the Company's common
stock, no par value (the "Common Stock"), held by the shareholder in
certificate form and the shares of Common Stock held by the Dividend
Reinvestment Plan Administrator in the shareholder's Dividend Reinvestment Plan
account. If a proxy is not returned, shares of Common Stock, including any held
under the Dividend Reinvestment Plan, will not be voted on behalf of the
shareholder.

Outstanding Shares and Voting Rights

The record date for determining shareholders entitled to notice of and to
vote at the Annual Meeting is March 24, 2000. Only shareholders of record as of
that date will be entitled to notice of, and to vote at, the Annual Meeting.

On the record date 6,755,794 shares of Common Stock (the only class of
stock outstanding) were outstanding and all outstanding shares are eligible to
be voted at the Annual Meeting. Each share of Common Stock is entitled to one
vote.

A plurality of the votes cast is necessary for the election of directors,
Proposal 1. The affirmative vote of the holders of a majority of the votes cast
is necessary for approval of the amendment to the 1997 Stock Option Plan,
Proposal 2.

All shares represented by valid proxies received pursuant to this
solicitation will be voted in favor of the election of the four nominees for
director who are named in this Proxy Statement and in favor of the amendment to
the 1997 Plan, unless the shareholder specifies a different choice by means of
his or her proxy or revokes the proxy prior to the time it is exercised. Should
any other matters properly come before the Annual Meeting, the persons named as
proxies will vote upon such matters according to their discretion.

At the meeting, inspectors of election will tabulate both ballots cast by
shareholders present and voting in person and votes cast by proxy. Under
applicable state law and the Company's Restated Certificate of Incorporation
and By-Laws, abstentions and broker non-votes are counted for purposes of
establishing a quorum but otherwise do not count. Generally, the approval of a
specified percentage of shares voted at a shareholder meeting is required to
approve a proposal and thus abstentions and broker non-votes have no effect on
the outcome of a vote. Where state law or the Company's Restated Certificate of
Incorporation or By-Laws require that the matter voted upon be approved by a
specified percentage of the outstanding shares, then abstentions and broker
non-votes have the same effect as negative votes.

Revocability of Proxies

Any shareholder giving a proxy has the right to attend and vote at the
Annual Meeting in person. A proxy may be revoked prior to the Annual Meeting by
a later-dated proxy or by a written revocation sent to Stephen F.
<PAGE>

Carman, Secretary of the Company, at 2465 Kuser Road, Hamilton, New Jersey
08690 (Mailing Address: P.O. Box 8487, Trenton, New Jersey 08650). A proxy may
be revoked at the Annual Meeting by filing a later-dated proxy or by filing a
written notice of such revocation with the Secretary of the Annual Meeting
prior to the voting of such proxy.

Solicitation of Proxies

This proxy solicitation is being made by the Board of Directors of the
Company and the cost of the solicitation will be borne by the Company. In
addition to the use of the mails, proxies may be solicited personally, by
telephone, or by other electronic means by officers, directors and employees of
the Company or the Company's wholly-owned bank subsidiary, The Yardville
National Bank (the "Bank"), who will not be specially compensated for such
solicitation activities. Arrangements may be made with brokerage houses and
other custodians, nominees and fiduciaries for forwarding solicitation
materials to the beneficial owners of shares held of record by such persons and
the Company will reimburse such persons for their reasonable expenses incurred
in that connection.

PROPOSAL 1 -- ELECTION OF DIRECTORS

The Restated Certificate of Incorporation and the By-Laws of the Company
provide that the number of directors shall not be less than five or more than
twenty-five and permits the exact number to be determined from time to time by
the Board of Directors. The Board has fixed the number of directors at twelve.

Pursuant to the Restated Certificate of Incorporation, the directors of
the Company are divided into three classes and each class is elected to serve
for staggered three-year terms.

Lorraine Buklad, Sidney L. Hofing, James J. Kelly and Louis R. Matlack
have been nominated for three year terms as directors. The eight directors
named in Table II below have terms of office extending beyond the Annual
Meeting. If, for any reason, any of the four nominees becomes unavailable for
election, the proxy solicited by the Board of Directors will be voted for such
substituted nominee as is selected by the Board of Directors. The Board has no
reason to believe that any of the named nominees are not available or will not
serve if elected.

The names of the nominees for election and certain information about them
and about the directors whose terms extend beyond this Annual Meeting are set
forth in the following tables. Years of service on the Board of Directors
includes prior service on the Bank's board.

Table I -- Nominees for 2000 Annual Meeting

<TABLE>
<CAPTION>
Nominated
Name, Age and Principal Occupations Director For Term
Position with Company During Past Five Years Since Expiring
- ----------------------- --------------------------------------- ---------- ----------
<S> <C> <C> <C>
Lorraine Buklad, 64 Funeral Director and President 1988 2003
of Buklad Memorial Homes

Sidney L. Hofing, 65 President and CEO of The Eagle Group, 1997 2003
Inc. (Real estate development and
management company); Chairman of
General Packaging Services, Inc.
(November 1986 to December 1998)

James J. Kelly, 65 Private Consultant 1997 2003
(Electrical contracting)

Louis R. Matlack, 65 Principal, Matlack Mediation 1997 2003
</TABLE>

Mr. Hofing is also a director of Admiralty Bancorp, a public company whose
shares are registered pursuant to Section 12 of the Securities Exchange Act of
1934.

2
<PAGE>

Table II -- Directors Whose Terms Continue Beyond This Annual Meeting

<TABLE>
<CAPTION>
Name, Age and Principal Occupations Director Term
Position with Company During Past Five Years Since Expiring
- ---------------------------- ------------------------------------------- ---------- ---------
<S> <C> <C> <C>
Anthony M. Giampetro, 63 Physician, private practice 1994 2001

Patrick M. Ryan, 55 President and CEO of the Company and 1992 2001
President and Chief the Bank
Executive Officer

F. Kevin Tylus, 45 Senior Vice President and Chief Operating 1992 2001
Officer CIGNA Dental (November 99 to
present); Vice President/Director for
Prudential Health Care Group (July 1995
to November 1999); Chief Operating
Officer for Eastern Mercy Health System
(September 1992 to July 1995)

Elbert G. Basolis, Jr., 38 President, CFO and Owner of Aqua 1996 2001
Control Inc. (Water utility consultant);
Executive Vice President of Garrison
Enterprises, Inc. (Construction)

C. West Ayres, 72 President, Ayres Pontiac-Cadillac 1978 2002
Company, Inc. (Car sales)

Jay G. Destribats, 65 Chairman of the Board of the Company 1990 2002
Chairman of the Board and the Bank; Partner, Destribats,
Campbell, DeSantis, Magee and O'Donnell
(Counselors at law)

Gilbert W. Lugossy, 64 Retired April 1997; formerly Member, 1991 2002
New Jersey State Parole Board
(April 1990 to April 1997)

Weldon J. McDaniel Jr., 73 Technical Assistant -- Engineering, 1986 2002
USX Corporation
(March 1993 to present)
</TABLE>

Board Meetings and Committees, Functions and Attendance

The Company held eight meetings of the Board during 1999. The directors of
the Company also serve as directors of the Bank. The Board of Directors of the
Bank holds regularly scheduled meetings once a month and special meetings as
circumstances require. During 1999, the Board of Directors of the Bank held
twelve meetings.

The Board of Directors has a number of committees, including the Audit,
Organization and Compensation, and Nominating Committees. The functions of
those Committees are set forth below:

Audit

Chaired by Mr. Lugossy and including Messrs. McDaniel, Jr., Basolis, Jr.,
Kelly, and Matlack, this committee met four times in 1999. The function of the
Audit Committee is to review the general audit plan and report of the
independent certified public accountants and recommend to the Board of
Directors the appointment of independent certified public accountants. This
committee also approves the internal audit and loan review scope, reviews
internal audit reports and management's reponses to those audits, reviews all
examination reports of the regulatory agencies and recommends to the Board any
action to be taken in connection therewith.

3
<PAGE>

Organization and Compensation

Chaired by Mr. Tylus and including Messrs. Destribats, Ryan, Basolis, Jr.,
and McDaniel, Jr., this committee met two times in 1999. The Organization and
Compensation Committee is responsible for assuring an effective and competitive
salary structure for the senior management of the Company and Bank. This
committee recommends to the Board employment, promotion and annual compensation
arrangements for senior management of the Company and Bank.

Nominating

Chaired by Mr. Destribats and including Ms. Buklad and Messrs. McDaniel,
Jr., Ryan, and Ayres, this committee met three times in 1999. The Nominating
Committee considers the appropriate size and composition of the Board. This
committee also recommends nominees to the Board of Directors for election as
directors.

During 1999, each director of the Company attended at least 75% of the
aggregate total number of Board meetings of the Company and meetings of the
committees of the Board of the Company on which such director served.

PROPOSAL II --APPROVAL OF AMENDMENT TO 1997 STOCK OPTION PLAN

The Board of Directors has approved for submission to the shareholders, an
amendment to the Yardville National Bancorp 1997 Stock Option Plan (the "1997
Plan") to increase the number of shares of the Company's common stock that may
be issued pursuant to the plan from 410,000 shares to 1,070,000 shares. The
objective of the 1997 Plan is to assist the Company in attracting and retaining
highly qualified persons as employees of the Company and the Bank and to
provide such employees with incentives to contribute to the growth and
development of the Company. The 1997 Plan provides for the granting of both
incentive stock options under Section 422 of the Code and non-qualified stock
options. Set forth below is a summary of certain important features of the
amended 1997 Plan, which summary is qualified in its entirety by reference to
the full text of the 1997 Plan, as amended, which is published in the Proxy
Statement as Appendix A. The proposed amendment is shown in italics in Appendix
A.

Administration

The 1997 Plan will be administered by a Stock Option Committee (the
"Committee") of not less than two Directors who are ineligible to receive
options under the 1997 Plan within one year of such designation. The Board will
annually appoint members of the Committee at the annual reorganization meeting.

The Committee will identify the optionees and determine the number of
shares subject to each option, the date of grant and the terms and conditions
governing the option. The Committee has the responsibility of interpreting the
1997 Plan and making all administrative determinations thereunder.

Eligibility

Options may be granted to any employee of the Company or the Bank. Since
discretion for stock options is vested in the Committee, the Committee
determines the identity and number of employees who will receive options under
the 1997 Plan. A person who is a director of the Company or any of its
subsidiaries will not be considered an employee for purposes of the 1997 Plan
solely because he or she is a director. However, a person who is an employee
will not be disqualified by virtue of being a director of the Company or any
subsidiary.

Terms and Conditions of Stock Options

Term

The 1997 Plan provides that if an optionee's employment terminates by
reason of death or disability, his or her options will terminate twelve months
later. If an optionee's employment terminates for any other reason, his or her
options will terminate three months later.

Each stock option granted under the 1997 Plan will expire no later than
ten years after the date on which it shall have been granted. Any incentive
stock options granted to any optionee who owns more than 10% of the Common
Stock (a "10% Shareholder") will terminate no later than five years after the
date on which the incentive stock option was granted.

4
<PAGE>

Limitations on Grant

An option granted under the 1997 Plan may be either an incentive stock
option or a non-qualified stock option. No incentive stock option may be
granted to an individual if the fair market value (determined as of the date of
grant of the option) of Common Stock which first becomes purchasable thereunder
and under all other options held by such individual would exceed $100,000 in
any calendar year. Options granted under the 1997 Plan that are not considered
incentive stock options will be non-qualified stock options, and therefore,
will not contain the dollar limitation stipulated for the incentive stock
options.

Exercise Price

The 1997 Plan generally provides that options are to be granted at an
exercise price equal to the "fair market value" (on the date of grant) of the
Common Stock purchasable thereunder. The 1997 Plan provides that incentive
stock options granted to 10% Shareholders must bear an exercise price of not
less than 110% of "fair market value" on the date of grant. Fair market value
will mean the closing price of a share of Common Stock on the immediately
preceding business day as reported by the National Association of Securities
Dealers Automated Quotation System (NASDAQ) or a similar organization if NASDAQ
is no longer reporting such information.

The 1997 Plan provides that the purchase price for shares acquired
pursuant to the exercise of any option is payable in full at the time of
exercise. The purchase price may be paid in cash or in shares of Common Stock
already owned with a fair market value (on the date of exercise) equal to the
purchase price for the shares being acquired pursuant to the exercise of
options.

Shares Subject to the 1997 Plan

When adopted the 1997 Plan authorized the Company to issue up to 200,000
shares of common stock pursuant to incentive and non-qualified stock options.
Due to a two-for-one stock split effected in the form of a 100% stock dividend
and a 2.5% stock dividend the number of authorized shares was increased to
410,000 shares pursuant to the terms of the 1997 Plan. The amendment to the
1997 Plan would authorize the Company to issue up to 1,070,000 shares of common
stock pursuant to incentive and non-qualified stock options. The 1997 Plan
provides that the number of shares available for stock options and the number
of shares covered by outstanding stock options will be adjusted equitably for
stock splits, stock dividends, recapitalizations, mergers and other changes in
the Company's capital stock. Comparable changes will be made to the exercise
price of outstanding options. Options to purchase 383,914 shares were
outstanding as of March 31, 2000, of which options to purchase 146,818 shares
are exercisable as of that date. As of March 31, 2000 there were 26,086
additional shares available for issuance pursuant to the 1997 Plan.

Amendment and Termination

By its terms, no incentive stock options may be granted under the 1997
Plan after April 24, 2007. The Board of Directors has the right to terminate
the 1997 Plan at any time.

The Board of Directors also has the right to amend the 1997 Plan;
provided, however, that it may not, without further shareholder approval (i)
increase the maximum number of shares subject to the 1997 Plan (except for
adjustments as described above), (ii) extend the period during which options
may be granted or exercised or (iii) make any other changes unless the Board
determines that the change would not materially increase the cost of the 1997
Plan to the Company.

Federal Income Tax Consequences Under the 1997 Plan

Incentive Stock Options

For incentive stock options, the optionee will not realize any taxable
income upon receipt of shares upon the exercise of the option. However, the
excess of the fair market value of the stock on the date of exercise over the
exercise price is an item of adjustment to be taken into account in determining
whether the "alternative minimum tax" will apply for the year of exercise. If
the shares acquired upon exercise are held at least two years from the date of
grant and one year from the date of exercise, any gain or loss upon the sale of
such shares, if held as capital assets, will be long-term capital gain or loss
(measured by the difference between the sales price of the stock and the
exercise price). If the two year and one year holding periods are not met (a
"disqualifying

5
<PAGE>

disposition"), an optionee will realize ordinary income in the year of
disposition in an amount equal to the lesser of (i) the fair market value of
the stock on the date of exercise minus the exercise price or (ii) the amount
realized on disposition minus the exercise price. The remainder of the gain
will be treated as long-term or short-term gain depending upon whether the
stock has been held for more than twelve months. If an optionee makes a
disqualifying disposition, the Company will be entitled to a tax deduction
equal to the amount of ordinary income recognized by the optionee.

In general, if an optionee in exercising an incentive stock option tenders
shares of Common Stock in partial or full payment of the option price, no gain
or loss will be recognized on the tender. However, if the tendered shares were
previously acquired upon the exercise of another incentive stock option and the
tender is within two years from the date of grant or one year after the date of
exercise of the other incentive stock options, the tender will be a
disqualifying disposition of the shares acquired upon exercise of the other
incentive stock option.

As noted above, the exercise of an incentive stock option could subject
the optionee to the alternative minimum tax. The application of the alternative
minimum tax to any particular optionee depends upon the particular facts and
circumstances which exist with respect to the optionee in the year of exercise.
However, as a general rule, the amount by which the fair market value of the
Common Stock on the date of exercise of an option exceeds the exercise price of
the option will constitute an item of adjustment for purposes of the
alternative minimum tax. As such, this item will enter into the tax base on
which the alternative minimum tax is computed, and may therefore cause the
alternative minimum tax to become applicable in a given year, (alternative
minimum tax, if applicable, would be incurred equal to 26% of the excess
alternative minimum taxable income up to $175,000 and 28% for any amount in
excess of $175,000).

Nonqualified Stock Options

Nonqualified stock options granted under the 1997 Plan do not qualify as
"incentive stock options" and will not qualify for any special tax benefits to
the optionee. An optionee generally will not recognize any taxable income at
the time he or she is granted an nonqualified option. However, upon its
exercise, the optionee will recognize ordinary income for federal tax purposes
measured by the excess of the then fair market value of the shares over the
exercise price. The income realized by the optionee will be subject to income
and other employee withholding taxes. Generally, upon exercise of a
nonqualified stock option, the Company will be entitled to a deduction for
federal income tax purposes equal to the amount of ordinary income that an
optionee is required to recognize as a result of the exercise.

The optionee's basis for determination of gain or loss upon the subsequent
disposition of shares acquired upon the exercise of a nonqualified stock option
will be the amount paid for such shares plus any ordinary income recognized as
a result of the exercise of such option. Upon disposition of any shares
acquired upon the exercise of a nonqualified stock option, the difference
between the sale price and the optionee's basis in the shares will be treated
as a capital gain or loss and generally will be characterized as a long-term
capital gain or loss if the shares have been held for more than one year at
their disposition.

Tax Rates

Under current law, the maximum marginal Federal income tax rate on
ordinary income is 39.6%. The maximum Federal income tax imposed on adjusted
net capital gains, however, is 20%. Net capital gains means the excess of net
long-term capital gains over net short-term capital loss. Net short-term
capital gains may be taxed at rates for ordinary income. Capital losses may be
offset only against capital gains and may be deducted against ordinary income
only to the extent of three thousand dollars ($3,000) per year.

The foregoing Federal income tax information is a summary only, and does
not purport to be a complete statement of the relevant provisions of the Code.
Because of the complexity of the Federal income tax laws and the application of
various state income tax laws, optionees are advised to consult their personal
tax advisors before exercising an option or disposing of any stock received
pursuant to the exercise of an option.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 2, ADOPTION OF THE
AMENDMENT TO THE 1997 STOCK OPTION PLAN.

6
<PAGE>

MANAGEMENT
The following table sets forth the name and age of each executive officer
of the Company and the Bank (excluding Messrs. Ryan and Destribats) and the
business experience of these individuals during the past five years. Unless
otherwise indicated, each named position is with the Bank. The executive
officers are appointed to their respective offices annually.

<TABLE>
<CAPTION>
Name, Age and Principal Occupations
Position with Company During Past Five Years
- -------------------------------------- ----------------------------------------------------------
<S> <C>
Stephen F. Carman, 43
Secretary and Treasurer ............. Secretary and Treasurer of the Company and Executive
Vice President and Chief Financial Officer of the Bank
James F. Doran, 56
First Senior Vice President ......... First Senior Vice President and Senior Loan Officer
(April 1996 to present); Senior Vice President (January
1994 to April 1996)
Frank Durand, III, 49
Senior Vice President ............... Senior Vice President and Bank Administrator (Febru-
ary 1995 to present); Senior Vice President and Branch
Administrator (November 1992 to February 1995)
Kathleen A. Fone, 51
Senior Vice President ............... Senior Vice President, Human Resources (February
2000 to present); Vice President, Human Resources
(October 1988 to February 2000)
Howard N. Hall, 40
First Senior Vice President ......... First Senior Vice President and Controller (February
2000 to present); Senior Vice President and Controller
(November 1997 to February 2000); Vice President
and Chief Financial Officer of Commonwealth State
Bank (April 1992 to October 1997)
Richard A. Kauffman, 53
Senior Vice President ............... Senior Vice President and Chief Technology Officer
(November 1997 to present); Senior Vice President and
Controller (March 1995 to November 1997); Senior
Vice President and Auditor (April 1991 to March 1995)
Timothy J. Losch, 49
Executive Vice President ............ Executive Vice President and Chief Operating Officer
(June 1997 to present); Senior Vice President and
Director of Public Affairs and Governmental Relations
of CoreStates Bank NA (February 1993 to May 1997)
Nina Melker, 38
Senior Vice President ............... Senior Vice President and Retail Administrator (Janu-
ary 1998 to present); Vice President and Retail Admin-
istrator (February 1995 to January 1998); Vice Presi-
dent, Commercial Lending (July 1993 to February
1995)
Thomas L. Nash, 59
Senior Vice President ............... Senior Vice President, Commercial Mortgage Lending
(January 1999 to present); Vice President, Commercial
Mortgage Lending (October 1995 to January 1999);
President and CEO of Family First Savings Bank
(October 1993 to October 1995)
Mary C. O'Donnell, 52
First Senior Vice President ......... First Senior Vice President and Chief Credit Officer
(April 1996 to present); Senior Vice President (Sep-
tember 1992 to April 1996)
Sarah J. Strout, 45
Senior Vice President ............... Senior Vice President, Commercial Lending (January
1997 to present); Vice President, Commercial Lending
(October 1991 to January 1997)
</TABLE>

7
<PAGE>

STOCK OWNERSHIP OF MANAGEMENT AND PRINCIPAL SHAREHOLDERS

The table below sets forth the beneficial ownership of the Company's
Common Stock as of March 24, 2000, by each person who is known by the Company
to beneficially own 5% or more of the Common Stock, each other director and
nominee, each of the Named Executive Officers (See Executive Officers'
Compensation) and all directors and executive officers of the Company and the
Bank as a group. All shares of a named person are deemed to be subject to that
person's sole voting and investment power unless otherwise indicated. Shares
subject to stock options are included as outstanding shares of Common Stock
except to the extent such options are not exercisable within 60 days. Other
than stock options, there are no securities outstanding giving the holders the
right to acquire shares of Common Stock. Each of the Named Executive Officers
and each director and nominee have an address c/o Yardville National Bancorp,
2465 Kuser Road, Hamilton, New Jersey 08690.

<TABLE>
<CAPTION>
Number of Shares Percent of
Name of Beneficial Owner Beneficially Owned (1) Common Stock
- ----------------------------------------- ------------------------ -------------
<S> <C> <C>
Directors:
C. West Ayres 80,623 (2) 1.19%
Elbert G. Basolis, Jr. 27,145 (3) *
Lorraine Buklad 134,430 (4) 1.99%
Stephen F. Carman 46,666 (5) *
Jay G. Destribats 207,360 (6) 3.06%
Anthony M. Giampetro M.D. 72,992 (7) 1.08%
Sidney L. Hofing 99,837 (8) 1.48%
James J. Kelly 170,280 (9) 2.52%
Timothy J. Losch 32,987 (10) *
Gilbert W. Lugossy 14,547 (11) *
Louis R. Matlack, Ph.D. 87,500 (12) 1.29%
Weldon J. McDaniel, Jr. 11,029 (13) *
Patrick M. Ryan 331,853 (14) 4.89%
F. Kevin Tylus 152,504 (15) 2.29%

Directors and Executive Officers of the 1,323,750 (16) 19.10%
Company as a group (22 persons)

Wellington Management Company, LLP 603,100 (17) 8.93%
75 State Street
Boston, Massachusetts 02109
</TABLE>

- ------------
* Less than 1%

(1) The number of beneficially owned shares includes shares over which the
named person, directly or indirectly through any contract, arrangement,
understanding, relationship or otherwise, has or shares (1) voting power,
which includes the power to vote, or direct the voting of, such security;
or (2) investment power, which includes the power to dispose, or to direct
the disposition of, such security.

(2) Includes 2,152 shares held by Mr. Ayres spouse, and 2,624 shares issuable
upon exercise of options held by Mr. Ayres under the Company's 1994 Stock
Option Plan (the "1994 Plan") (See Director Compensation Arrangements).

(3) Includes 9,100 shares held by Aqua Control Inc. and 4,264 shares issuable
upon exercise of options held by Mr. Basolis, Jr. under the Company's 1994
Plan.

(4) Includes 2,624 shares issuable upon exercise of options held by Ms. Buklad
under the 1994 Plan.

(5) Includes 33,620 shares issuable upon exercise of options held by Mr. Carman
under the Company's 1988 Stock Option Plan (the "1988 Plan") and the
Company's 1997 Stock Option Plan (the "1997 Plan"), 632 shares in the
Yardville National Bank Employee Stock Ownership Plan Trust (the "ESOP"),
3,037 shares held jointly with Mr. Carman's spouse and 225 shares held by
Mr. Carman as custodian for his child.

8
<PAGE>

(6) Includes 16,400 shares issuable upon exercise of options held by Mr.
Destribats under the 1997 Plan, 52,000 shares held in the Destribats
Family Trust, of which Mr. Destribats is the Trustee, 3,000 shares held
jointly by Mr. Destribats and his spouse, 7,657 shares in the Yardville
National Bank 401(K) plan, 843 shares in the ESOP and 124,272 shares in
the ESOP over which Mr. Destribats, as a trustee, shares voting rights
with Mr. Ryan and Mr. Tylus.

(7) Includes 26,908 shares held in the name of Anthony M, Giampetro, M.D.,
custodian for Anthony Giampetro, John Giampetro, and Celeste Giampetro,
under the Pennsylvania Uniform Gift to Minors Act, 16,400 shares held in
the name of Bellarmino-Giampetro Profit Sharing Fund, 24,190 shares held
in the name of Bellarmino-Giampetro Pension Voluntary Contribution Plan
and 2,624 shares issuable upon exercise of options held by Dr. Giampetro
under the 1994 plan.

(8) Includes 82,757 shares held by Mr. Hofing's spouse, 11,176 shares held in
the Hofing Family Limited Partnership and 5,904 shares issuable upon
exercise of options held by Mr. Hofing under the 1994 Plan.

(9) Includes 5,904 shares issuable upon exercise of options held by Mr. Kelly
under the 1994 Plan.

(10) Includes 19,954 shares issued upon the exercise of options held by Losch
under the 1997 plan, 2,218 shares in the Yardville National Bank 401(K)
plan, 632 shares in the ESOP, and 50 shares held by Mr. Losch as custodian
for one of his children.

(11) Includes 2,624 shares issuable upon exercise of options held by Mr.
Lugossy under the 1994 Plan and 2,735 shares held jointly with Mr.
Lugossy's spouse.

(12) Includes 2,624 shares issuable upon exercise of options held by Mr.
Matlack under the 1994 plan, 6,199 shares held in the Matlack Family
Trust, of which Mr. Matlack is a co-executor and 36,561 shares in the
Hannah F. Hendrickson Family Trust, of which Mr. Matlack is a co-trustee.

(13) Includes 2,624 shares issuable upon exercise of options held by Mr.
McDaniel, Jr. under the 1994 plan.

(14) Includes 32,800 shares issuable upon exercise of options held by Mr. Ryan
under the Company's 1997 Plan, 3,098 shares in the Yardville National Bank
401(K) plan, 843 shares in the ESOP, 451 shares held by Mr. Ryan as
custodian for his children and 124,272 shares in the ESOP over which Mr.
Ryan, as a trustee, shares voting rights with Mr. Destribats and Mr.
Tylus.

(15) Includes 2,624 shares issuable upon exercise of options held by Mr. Tylus
under the 1994 plan, 7,544 shares held jointly with Mr. Tylus's spouse and
124,272 shares in the ESOP over which Mr. Tylus, as a trustee, shares
voting rights with Mr. Destribats and Mr. Ryan.

(16) Includes 176,210 shares issuable upon exercise of options held by such
persons as a group under the 1988 Plan, the 1994 Plan, and the 1997 Plan,
and 122,272 ESOP shares over which Mr. Destribats, Mr. Ryan and Mr. Tylus
have shared voting rights as trustees.

(17) Includes 377,900 shares as to which Wellington Management Company, LLP has
shared power to vote or to direct the voting of and 603,100 shares as to
which Wellington Management Company, LLP has shared power to dispose of or
to direct the disposition of.

9
<PAGE>

EXECUTIVE OFFICERS' COMPENSATION
Summary Compensation Table

The following table sets forth compensation paid or allocated with respect
to the fiscal years ended December 31, 1999, 1998 and 1997 for services
rendered in all capacities to the Company and the Bank by the President and
Chief Executive Officer of the Company and the only other three executive
officers whose aggregate salary and bonus exceeded $100,000 in any of such
years (collectively, the "Named Executive Officers"):

<TABLE>
<CAPTION>
Long Term
Compensation
Annual Compensation Awards
---------------------------- ----------------
Securities All Other
Underlying Compensation
Name and Principal Position Year Salary ($) Bonus($)(1) Options/SARs # ($)(2)
- -------------------------------- ------ ------------ ------------- ---------------- -------------
<S> <C> <C> <C> <C> <C>
Patrick M. Ryan, 1999 225,000 160,400 0 22,411
President and Chief Executive 1998 200,000 100,435 82,000 11,874
Officer of the Company 1997 200,000 100,120 0 11,187

Jay G. Destribats, 1999 180,000 0 0 17,765
Chairman of the Company 1998 160,000 0 41,000 7,633
1997 150,000 0 0 7,092

Stephen F. Carman, 1999 120,000 19,000 0 13,494
Secretary and Treasurer of the 1998 100,000 12,500 32,800 5,155
Company 1997 85,000 18,000 0 4,694

Timothy J. Losch, 1999 120,000 15,000 0 13,661
Executive Vice President and 1998 115,000 12,500 32,800 11,054
Chief Operating Officer of the 1997 61,250 9,000 10,250 2,019
Bank (3)
</TABLE>

- ------------
(1) Paid in the fiscal year following the fiscal year for which it is reported.

(2) All other compensation includes the Company's contribution under its 401(k)
plan for the fiscal years ended December 31, 1999, 1998 and 1997 for (a)
Mr. Ryan: $5,000, $5,000, and $4,556, (b) Mr. Destribats: $3,715, $3,692,
and $3,462, (c) Mr. Carman: $2,580, $2,486, and $2,125, and (d) Mr. Losch:
$2,101 and $1,351. Other compensation also includes annual premiums paid
by the Company for an executive group term replacement life insurance plan
for the fiscal years ended December 31, 1999, 1998 and 1997 for (a) Mr.
Ryan: $3,288, $3,028, and $2,785, (b) Mr. Destribats: $4,253, $3,941, and
$3,630, (c) Mr. Carman: $1,259, $1,147 and $1,047, and (d) Mr. Losch:
$1,905 and $8,376. Other compensation also includes the cost related to
shares granted to each executive under the Yardville National Bank
Employee Stock Ownership Trust for the fiscal year ended December 31, 1999
for (a) Mr. Ryan: $9,796, (b) Mr. Destribats: $9,796, (c) Mr. Carman:
$7,347 and (d) Mr. Losch: $7,347. Other compensation also includes the
cost associated with the payment for up to one week of unused vacation per
year for the fiscal years ended December 31, 1999, 1998 and 1997 for (a)
Mr. Ryan: $4,327, $3,846 and $3,846, (b) Mr. Carman: $2,308, $1,522 and
$1,522 and (c) Mr. Losch: $2,308, $1,327 and $2,019.

(3) Mr. Losch was hired in June 1997.

Option Grants in Last Fiscal Year

There were no stock options granted to the Chief Executive Officer or the
other Named Executive Officers during the fiscal year ended December 31, 1999.

10
<PAGE>

Option Exercises in Last Fiscal Year and Year-End Option Values

The following table sets forth the aggregate stock options exercised by
each of the Named Executive Officers during the fiscal year ended December 31,
1999:

AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTIONS/SAR VALUES

<TABLE>
<CAPTION>
Number of
Securities
Underlying Value of Unexercised
Unexercised In-the-Money
Options/SARs at Options at
FY-End (#) FY-End ($)
------------------- --------------------
Shares Acquired Value Exercisable(E)/ Exercisable(E)/
Name on Exercise (#) Realized ($) Unexercisable (U) Unexercisable(U)
- ------------------- ----------------- -------------- ------------------- --------------------
<S> <C> <C> <C> <C> <C> <C>
E U E U
Patrick M. Ryan 10,500 95,462 26,400 65,600 77,226 0
Jay G. Destribats 0 0 8,200 32,800 0 0
Stephen F. Carman 0 0 27,060 26,240 158,313 0
Timothy J. Losch 0 0 13,394 29,656 2,771 1,385
</TABLE>

Employment Contracts and Termination of Employment and Change in Control
Arrangements

The Company employs Patrick M. Ryan as President and Chief Executive
Officer of the Bank and President and Chief Executive Officer of the Company
under an employment contract that became effective January 31, 1999. Mr. Ryan
is employed for a period of 24 months commencing January 31, 1999, and the
contract automatically renews for successive 12-month periods thereafter unless
either of the parties gives notice to the contrary. The employment contract
provides for an annual base salary of $225,000, which salary will be reviewed
and may be adjusted annually by the Board of Directors. In addition, Mr. Ryan
will receive an annual cash performance bonus equal to 2% of the profits of the
Company, after taxes, for each fiscal year, when such profits are $5,000,000 or
more. Mr. Ryan is also entitled to participate in any employee benefit plan or
perquisite arrangement established by the Company or the Bank and available to
senior executives and key management employees of the Company or the Bank, and
the Bank provides him with an automobile for his personal use. The employment
contract may be terminated with or without cause (as defined in the employment
contract).

In the event the employment contract is terminated by the Company, other
than for death, disability or cause, within three years after a Change in
Control (as defined below), or by Mr. Ryan, other than for death or disability,
within six months after a Change in Control, Mr. Ryan will be entitled to
receive an amount equal to three times his annual salary at the time of such
termination in a lump sum promptly after the occurrence of such termination (a
"Change in Control Termination"). If the Company terminates the employment
contract other than for disability, death or cause, and in the absence of a
Change in Control, Mr. Ryan will be entitled to receive a lump-sum payment upon
termination equal to the amount that would have been payable to him at his then
current annual salary for the remainder of the contract term. For purposes of
Mr. Ryan's employment contract, the term "Change in Control" means:

(i) the acquisition by any person or group acting in concert of the
beneficial ownership of 40% or more of any class of equity security of the
Company, or

(ii) the approval by the Board of Directors of the Company of the sale of
all or substantially all of the assets of the Bank or the Company, or

(iii) the approval by the Board of Directors of the Company of any merger,
consolidation, issuance of securities or purchase of assets, the result of
which would be the occurrence of any event described in clause (i) or (ii)
above.

11
<PAGE>

The Bank has entered into a Salary Continuation Plan for the benefit of
Mr. Ryan, dated October 28, 1994, whereby the Bank has agreed to make monthly
payments to Mr. Ryan or his designated beneficiary upon the termination of his
employment in certain circumstances and subject to certain conditions, as
described below, based upon the amount of his annual salary at the time of
termination (the "Final Annual Salary").

If Mr. Ryan continues to be an employee of the Bank until his normal
retirement date upon the attainment of age 65, which date is June 21, 2009, Mr.
Ryan may thereafter retire and he or his designated beneficiary will be
entitled to receive a monthly payment equal to (i) 50% of the Final Annual
Salary divided by (ii) 12 (the "Monthly Retirement Payment"), payable for a
period of 180 months or for his life, if longer. In addition, during the 180
month period following retirement, Mr. Ryan has agreed to be an independent
contractor/consultant to the Bank for a reasonable fee to be mutually agreed
upon and paid by the Bank to Mr. Ryan for his consulting services. During this
180 month period, Mr. Ryan has also agreed to be subject to certain
prohibitions on competition with the Bank.

If Mr. Ryan becomes totally disabled, as determined by the Bank, while he
is an employee of the Bank, and his employment terminates, the Bank will make a
monthly payment to Mr. Ryan equal to one-twelfth of the product obtained by
multiplying (a) 50% of the Final Annual Salary by (b) a fraction, the numerator
of which is the number of full years between the date of the Salary
Continuation Plan and the date of termination of Mr. Ryan's employment due to
his disability, and the denominator of which is the number of full years
between the date of the Salary Continuation Plan and June 21, 2009. This
disability payment will commence the first month after such termination and
continue until Mr. Ryan recovers from such disability, reaches the age of 65,
or dies, whichever occurs first. If such disability continues beyond June 21,
2009, Mr. Ryan will then be entitled to the Monthly Retirement Payment as
described above.

If Mr. Ryan terminates his employment with the Bank or if the Bank
terminates Mr. Ryan's employment for any other reason other than disability
prior to June 21, 2009, the Bank will make 180 monthly payments to Mr. Ryan
commencing June 21, 2009. Each payment will be in an amount equal to
one-twelfth of the product obtained by multiplying (a) 50% of the Final Annual
Salary by (b) a fraction, the numerator of which is the number of full years
between the date of the Salary Continuation Plan and the date of termination of
Mr. Ryan's employment and the denominator of which is the number of full years
between the date of the Salary Continuation Plan and June 21, 2009. The
foregoing will not apply, however, if Mr. Ryan's employment is terminated
because he has committed an act which exposes the Bank to economic harm or
damages the reputation or good will of the Bank.

In the event of a change of control of the Bank, (i.e., acquisition of at
least 40% of the Bank by an entity or individual that is not currently a
stockholder of the Company), if Mr. Ryan either resigns from his position with
the Bank or if his employment is terminated for any reason, which termination
shall be deemed to have occurred if Mr. Ryan's responsibilities are diminished
or assumed by another individual, then Mr. Ryan or his designated beneficiary
will be entitled to receive the Monthly Retirement Payment as described above
without reduction on account of termination prior to June 21, 2009.

If Mr. Ryan dies before June 21, 2009, commencing with the first month
following his death and continuing for 179 months thereafter, the Bank shall
pay the Monthly Retirement Payment to Mr. Ryan's named beneficiary as described
above.

The Company employs Jay G. Destribats as Chairman of the Board of the
Company and as Chairman of the Board of the Bank under an employment contract
that became effective as of January 31, 1999. The employment contract provides
for an annual salary of $180,000. The terms of Mr. Destribats' employment
contract are otherwise comparable to the terms of Mr. Ryan's employment
contract, but Mr. Destribats' employment contract does not provide for an
annual bonus. The Bank has also entered into a Salary Continuation Plan for the
benefit of Mr. Destribats on terms comparable to the plan for Mr. Ryan, but
with a normal retirement date at age 70 on March 27, 2005.

The Company employs Stephen F. Carman as Executive Vice President and
Chief Financial Officer of the Bank under an employment contract that became
effective as of January 31, 1999. The employment contract provides for an
annual salary of $120,000 in the first year and $125,000 in the second year of
the contract term. The terms of Mr. Carman's employment contract are otherwise
comparable to the terms of Mr. Ryan's contract,

12
<PAGE>

except that Mr. Carman's contract does not provide for an annual bonus,
provides for a lump-sum payment equal to two times Mr. Carman's annual salary
in the event of a Change in Control Termination, and does not provide for any
payment to Mr. Carman upon termination of the employment contract for any other
reason. The Bank has also entered into a Survivor Income Plan for the benefit
of Mr. Carman dated January 22, 1996. If Mr. Carman dies while in the
employment of the Bank, the Bank shall pay to Mr. Carman's designated
beneficiary an amount equal to 75% of Mr. Carman's final annual salary in 120
equal monthly installments.

The Company employs Timothy J. Losch as Executive Vice President and Chief
Operating Officer of the Bank under an employment contract that became
effective as of January 31, 1999. The employment contract provides for an
annual salary of $120,000 in the first year and $125,000 in the second year of
the contract term. The terms of Mr. Losch's employment contract are otherwise
comparable to the terms of Mr. Ryan's contract, except that Mr. Losch's
contract does not provide for an annual bonus, provides for a lump-sum payment
equal to two times Mr. Losch's annual salary in the event of a Change in
Control Termination, and does not provide for any payment to Mr. Losch upon
termination of the employment contract for any other reason. The Bank has also
entered into a Survivor Income Plan for the benefit of Mr. Losch dated January
1, 1998, on terms comparable to the plan for Mr. Carman.

Director Compensation Arrangements

For 1999, non-employee directors of the Company (which includes all
directors other than Mr. Destribats and Mr. Ryan) were paid $100 for each
Company Board meeting attended which was not held on the same day as a Bank
Board meeting was held. Non-employee directors were paid a fee of $600 per Bank
Board meeting. Non-employee directors were also paid $200 for attending each
committee meeting of the Board of Directors of the Company or the Bank ($250 in
the case of the chairman of such meeting). When committee meetings are held on
the same day, only one fee is paid to each such director who attends such
meetings. In 1999 non-employee directors were paid an annual retainer fee of
$5,000 in addition to normal Board and committee fees. Directors' fees and
retainers for the Company and the Bank are not paid to directors who are also
full time officers of the Bank or the Company. The Company in 1999 paid
premiums in the amount of $3,888 for health insurance for Ms. Buklad. The
aggregate directors' fees and retainers earned by non-employee directors in
1999 was $148,800.

Pursuant to a Deferred Compensation Plan that became effective on January
1, 1995, non-employee directors are allowed to defer all or a portion of their
annual fees and retainers. During 1999 the Company matched each director's
deferral at a rate of $.50 per dollar deferred. If a participant ceases to be a
director for any reason, such participant will at that time be entitled to
receive from the Company the aggregate amount of his or her deferred fees and
retainers and the Company's matching contributions, plus earnings on such
amount at an annual rate which may vary from year to year. The rate is based
upon the prime rate and is adjusted annually. The total amount to which any
participating director will be entitled will depend upon several factors,
including the number of years of participation and the amount of fees and
retainers earned and deferred. The annual cost to the Company for 1999 was
$69,100 which includes the Company's matching contributions and interest
earned.

For 2000 non-employee directors of the Company will continue to be paid
$600 per Bank Board meeting. Non-employee directors will also be paid $200 for
attending each committee meeting of the Board of Directors of the Company or
the Bank and the chairman of each such committee will be paid $250. During 2000
all non-employee directors will be paid an annual retainer of $5,000, to be
paid in quarterly increments at the end of each calendar quarter. Non-employee
directors will be paid $100 for each Company Board meeting attended which is
not held on the same day as a Bank Board meeting.

In 1994, the Company's Board of Directors adopted the Yardville National
Bancorp 1994 Stock Option Plan (the "1994 Plan"). The 1994 Plan is administered
by a committee (the "1994 Plan Committee") of not less than two employee
directors of the Company. Presently, Mr. Destribats and Mr. Ryan constitute the
1994 Plan Committee. Under the 1994 Plan, the 1994 Plan Committee may grant
options to purchase up to 144,000 shares of Common Stock in the aggregate to
non-employee directors of the Company. The purchase price per share under each
option shall be determined by the 1994 Plan Committee but may not be less than
100% of the fair market value of a share of Common Stock on the date of grant.
The 1994 Plan provides for adjustment of the number of shares subject to the
1994 Plan and the number of shares that may be purchased and the purchase

13
<PAGE>

price under each outstanding option in the event of any changes in the
outstanding Common Stock by reason of stock dividends, stock splits, mergers,
recapitalizations and similar events. The 1994 Plan Committee has discretion to
establish the term and vesting schedule for each option, although the term may
not exceed ten years, and the 1994 Plan provides that options generally will
vest during a period of up to five years after the date of grant.

14
<PAGE>

PERFORMANCE GRAPH

The following graph compares the percentage change in the cumulative total
return performance (assuming reinvestment of dividends) to holders of the
Company's Common Stock with that of the Total Return Index for The NASDAQ Stock
Market (U.S. Companies) and the peer group index of NASDAQ Bank Stocks, both of
which are published indexes. This comparison includes the period beginning June
9, 1995 through December 31, 1999. The Company's shares of Common Stock are
traded on the NASDAQ National Market System under the symbol "YANB". The
comparison of the cumulative return for each investment assumes that $100 was
invested in the Company's Common Stock and in each index on June 9, 1995, the
date on which the Company's Common Stock began trading on the NASDAQ National
Market System.

[GRAPHIC OMITTED]

<TABLE>
<CAPTION>
Period Ending
-----------------------------------------------------------------------------------
Index 6/9/95 12/31/95 12/31/96 12/31/97 12/31/98 12/31/99
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Yardville National Bancorp 100.00 113.87 144.86 267.39 222.66 189.09
NASDAQ - Total US 100.00 119.87 147.49 180.72 254.65 460.06
NASDAQ Bank Index 100.00 127.29 168.07 281.40 279.46 268.61
</TABLE>

15
<PAGE>

ORGANIZATION AND COMPENSATION COMMITTEE REPORT

The following report was prepared by the Organization and Compensation
Committee of the Board of Directors of the Company (the "Committee"),
consisting of two internal directors and three independent outside directors.
The Committee is responsible for establishing and overseeing policies governing
long-term compensation programs for executive level officers of the Company, to
attract, motivate and retain key executives responsible for the success of the
Company as a whole. The actions of the Committee are presented to the Board of
Directors for ratification. When the Committee's actions relate to officers who
are Directors, the Board (exclusive of the Officer-Directors) reviews the
recommendations of the Committee and approves final compensation arrangements.

The Committee believes that the Company's executive officer compensation
should be determined according to a competitive framework and based on overall
financial results, individual contributions and teamwork.

Within this overall philosophy, the Committee's specific objectives are
to:

Offer a total compensation program that takes into account the
compensation practices and financial performance for comparable positions in
other financial institutions.

Promote achievement of year-to-year financial and business objectives for
the Company and the Bank.

Motivate key executives to fulfill their responsibilities in meeting their
corporate business objectives.

Reward executives for long-term strategic management and the enhancement
of shareholder value through ownership of the Company.

There are three major components of the Company's executive officer
compensation:

1) Base Annual Salary

2) Annual Incentive Awards (Cash Bonuses and Supplemental Salary
Compensation)

3) Long Term Incentive Awards (Stock Options)

The Committee determines compensation by evaluating the responsibilities
of the position held and the experience of the individual and considers
compensation practices and financial performance for comparable positions
within the Company's peer group of financial institutions of comparable size
and structure.

Generally, annual salary adjustments, cash bonuses and supplemental salary
compensation are determined by evaluating the performance of the Company and
each executive officer. The Committee considers financial and non-financial
performance such as market share, operational productivity, loan servicing,
innovation and enhancement of employee development and customer satisfaction,
however, it does not apply any specific formula or assign any specific weights
to these factors in making compensation decisions.

In reviewing and establishing the Chief Executive Officer's (CEO) annual
salary, the Committee places significant emphasis on the Company's financial
performance and takes into account annual salaries of peer banks and banks
geographically approximate to the Company's market area. The CEO's annual cash
bonus is determined pursuant to the formula described below.

In January 1999 the Board of Directors set Mr. Ryan's annual salary for
each of the two years ending January 31, 2000 and 2001, at $225,000 per year,
with the potential to receive a cash bonus in each year equal to 2% of fiscal
year-end profits of the Company after tax if earnings exceed $5,000,000. Mr.
Ryan's annual salary in 1999 was determined as a result of several factors. Net
income increased 11.5% in 1998 over 1997's record results. Earnings per share
and cash dividends declared per share increased 12.2% and 20.8%, respectively.
Under Mr. Ryan's direction, the Bank has solidified its reputation as one of
the pre-eminent business lenders in its marketplace. The Company's loan
portfolio grew 27.5% in 1998 in a competitive environment. Mr. Ryan's
employment contract is reviewed and may be adjusted annually by the Board of
Directors. The Company under Mr. Ryan's leadership, recorded further increases
in net income, loans, and deposits in 1999. Net income increased 43.7% in 1999
over 1998's record results. Loans and deposits grew 31.5% and 43.1%
respectively. Based upon the Company's financial performance during fiscal year
1999 and the Company's expected growth in 2000, Mr. Ryan's annual base salary
for the twelve month period commencing January 31, 2000 remained at $225,000.

16
<PAGE>

ORGANIZATION & COMPENSATION COMMITTEE MEMBERS
F. KEVIN TYLUS (CHAIRMAN)
JAY G. DESTRIBATS
PATRICK M. RYAN
ELBERT G. BASOLIS, JR.
WELDON J. McDANIEL, JR.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The Organization and Compensation Committee of the Company's Board of
Directors is responsible for recommending annual compensation and long-term
compensation plans for executive officers of the Company. Recommendations are
then evaluated and ratified by the full Board of Directors. Annual compensation
and long-term compensation plans for Messrs. Destribats and Ryan are determined
by the non-employee directors of the Committee.

COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES AND EXCHANGE ACT OF 1934

Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors and persons who own more than ten percent of a
registered class of the Company's equity securities ("ten-percent holders") to
file reports of ownership and changes in ownership with the Securities and
Exchange Commission. Officers, directors and ten-percent holders are required
by regulation to furnish the Company with copies of all Section 16(a) forms
they file.

Based solely on review of the copies of such forms furnished to the
Company, or written representations that no Forms 5 were required except as
noted below, the Company believes that, during the fiscal year ended December
31, 1999, all Section 16(a) filing requirements applicable to its officers,
directors, and ten-percent holders were satisfied.

Ms. Buklad, Mr. Matlack, Mr. McDaniel, Jr., and Mr. Ryan each failed to
timely file a Form 4 for one transaction in the fiscal year ended December 31,
1999. Each subsequently filed a Form 4 for their transactions.

CERTAIN RELATIONSHIPS AND TRANSACTIONS WITH MANAGEMENT

Certain directors and officers of the Company and their associates are or
have been in the past customers of and have had transactions with the Bank, and
it is expected that such persons will continue to have such transactions in the
future. The aggregate extension of credit to directors, officers, and their
associates as a group was approximately $10.8 million as of December 31, 1999.
All deposit accounts, loans, and commitments comprising such transactions were
made in the ordinary course of business of the Bank on substantially the same
terms, including interest rates and collateral, as those prevailing at the time
for comparable transactions with other persons, and, in the opinion of
management of the Company and the Bank, did not involve more than normal risks
of collectibility or present other unfavorable features.

The Bank has had, and expects in the future to have, banking transactions
in the ordinary course of business with many of its directors, executive
officers and principal shareholders (and their associates) on substantially the
same terms as those prevailing for comparable transactions with others.

Jay G. Destribats, the Chairman of the Board of the Company and member of
the Organization and Compensation Committee, is a partner in the law firm of
Destribats, Campbell, DeSantis, Magee and O'Donnell. The firm performed general
legal services for the Bank during 1999 and continues to perform such services
in 2000. In 1999, Destribats, Campbell, DeSantis, Magee and O'Donnell were paid
$42,741 by the Bank for its services.

In October 1999, upon the expiration of the initial five year term, the
Bank renewed its lease for a five-year period for its Trenton branch office,
which is owned by The Lalor Urban Renewal Limited Partnership. The Lalor
Corporation, which is the general partner of the limited partnership, is owned
by Sidney L. Hofing, a director of the Company. Under the lease the Bank is
obligated to pay approximately $2,400 per month excluding utility and
maintenance expenses.

17
<PAGE>

In 1999, the Bank acquired a property in Bordentown, New Jersey from the
bankruptcy estate of a borrower. In 2000, the Bank proposes to sell the
property to a limited liability company of which Mr. Hofing is a member, and
lease the property from that company for use as a bank branch. The purchase and
sale prices which the Bank expects to be approximately equal amount, and the
terms of the lease, which the Bank expects to include terms (including lease
payments) comparable to lease transactions for similar properties in the local
market, have not yet been determined.

RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS

The firm of KPMG LLP, independent public accountants, has audited the
books and records of the Company since 1985 and the Bank since 1979. The Board
expects to retain KPMG LLP as the Company's independent public accountants for
the 2000 fiscal year.

KPMG LLP has advised the Company that one or more of its representatives
will be present at the Annual Meeting to make a statement if they so desire and
to respond to appropriate questions.

SHAREHOLDER PROPOSALS

A shareholder who wishes to nominate any individual as a director or have
the Shareholders take any action at the Annual Meeting of Shareholders in 2001
shall notify the Secretary of the Company at 2465 Kuser Road, Hamilton, New
Jersey 08690 by registered mail, return receipt requested, by February 24,
2000. Any such notice by a shareholder shall specify (I) the name of the
shareholder who will make the nomination or proposal or on whose behalf the
proposal or nomination will be made, (II) the names of all other shareholders
who are acting directly or indirectly with the proposing shareholder or have an
understanding directly or indirectly with the proposing shareholder, (III) the
number of shares which the shareholder reasonably anticipates may be voted in
favor of the proposal, and (IV) the name, address and business background of
any nominee and/or the full text of any proposal. In order for a shareholder
proposal to be included in the Company's Proxy Statement for the Annual Meeting
of Shareholders in 2001, in addition to meeting all of the requirements set
forth above, and all requirements of applicable security laws the Company must
receive the proposal by December 10, 2000.

OTHER MATTERS

The Board of Directors is not aware of any other matters which may come
before the Annual Meeting. However, in the event such other matters come before
the meeting, it is the intention of the persons named in the proxy to vote on
any such matters in accordance with the recommendations of the Board of
Directors.

Shareholders are urged to sign the enclosed proxy, which is solicited on
behalf of the Board of Directors, and return it in the enclosed envelope.

BY ORDER OF THE BOARD OF DIRECTORS

STEPHEN F. CARMAN, Secretary
April 10, 2000
Hamilton, New Jersey

18
<PAGE>

APPENDIX A

YARDVILLE NATIONAL BANCORP
1997 STOCK OPTION PLAN
(as Amended Effective May 2, 2000)

(1) Purpose of Plan

The 1997 Stock Option Plan (the "Plan") is designed to assist Yardville
National Bancorp (the "Company") in attracting and retaining highly qualified
persons as employees of the Company and its Subsidiaries and to provide such
key employees with incentives to contribute to the growth and development of
the business of the Company. This Plan provides for the granting of both
incentive stock options under Section 422 of the Code and non-qualified stock
options.

(2) Definitions

Unless the context otherwise indicates, the following terms have the
following meanings:

"Board" -- means the Board of Directors of the Company as constituted from
time to time.

"Business Day" -- means a day (other than a Saturday or Sunday) on which
the principal office of the Company is open for the conduct of normal business.

"Change of Control" -- means the acquisition by any person or group acting
in concert of beneficial ownership (as defined in Rule 13d-3 under the Exchange
Act) of forty percent (40%) or more of any class of equity security of the
Company.

"Code" -- means the Internal Revenue Code of 1986, as the same may from
time to time be amended.

"Committee" -- means the Committee referred to in Section 4 hereof.

"Common Stock" -- means the Common Stock, no par value, of the Company.

"Designated Beneficiary" -- means the person designated by an optionee to
be entitled on his death to any remaining rights arising out of an option, such
designation to be made in accordance with such regulations as the Committee may
implement from time to time.

"Director" -- means a member of the Board, who is not currently an officer
of the Company or Subsidiary of the Company, or otherwise currently employed by
the Company or Subsidiary of the Company; who does not receive compensation
either directly or indirectly from the Company or Subsidiary of the Company,
for services rendered as a consultant or in any other capacity other than as a
Director; and otherwise qualifies as a "Non-Employee director" under Rule 16b-3
under the Exchange Act.

"Employee" -- means any employee (including any officer) of the Company or
any Subsidiary of the Company.

"Exchange Act" -- means the Securities and Exchange Act of 1934, as it may
be amended from time to time, or any successor act or statute.

"Fair Market Value" -- means the fair market value of Common Stock as
determined by the Committee in accordance with Section 6(b) hereof.

"Incentive Stock Options" -- means stock options which constitute
incentive stock options within the meaning of Section 422, or any successor
section, of the Code having the provisions specified in the Plan for such
incentive stock options.

"Non-Qualified Stock Options" -- means stock options to purchase shares of
Common Stock granted to a participant under the Plan which are not intended to
be Incentive Stock Options.

"Parent" -- means "Parent Corporation" as defined in Section 424(e), or
any successor section, of the Code.

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"Stock Option Agreement" -- means a stock option agreement entered into
between the Company and an employee pursuant to the Plan period.

"Subsidiary" -- means "Subsidiary Corporation" as defined in Section
424(f), or any successor section, of the Code.

"Ten Percent Shareholder" -- shall mean any person who, immediately after
any option is granted to such person, owns within the meaning of Section 422
(b) (6), (or any successor section of the Code) more than 10% of the total
combined voting power of all classes of stock of the Company, its Parent, if
any, or its Subsidiaries.

(3) Stock Subject to Plan

The shares to be issued upon exercise of the options granted under the
Plan shall be Common Stock. The maximum number of shares of Common Stock for
which options may be granted under the Plan shall be 1,070,000 shares (subject
to adjustment as provided in section 9 hereof). The Common Stock to be issued
upon exercise of the options may be authorized but unissued shares or treasury
shares, as determined from time to time by the Committee. If any option granted
under the Plan shall expire or terminate for any reason whatsoever without
having been exercised in full, the unpurchased shares of Common Stock
previously subject to such option shall become available for new options.

(4) Administration

(a) The Plan shall be administered by a Stock Option Committee (the
"Committee") of not less than two Directors. The Board shall annually appoint
the members of the Stock Option Committee at the annual reorganization meeting
of the Board.

(b) The Board shall fill all vacancies on the Committee and may remove any
member of the Committee at any time with or without cause. The Committee shall
select its own chairman and shall adopt, alter or repeal such rules and
procedures as it may deem proper and shall hold its meetings at such times and
places as it may determine. The Committee shall keep minutes of its
proceedings. Action by a majority of the Committee members present at any
meeting at which a quorum is present, or action approved in writing by all
members of the Committee without a meeting, shall constitute the acts of the
Committee.

(c) Subject to the provisions of the Plan, the Committee shall have the
full and final authority to (i) determine the Employees to whom, and the times
at which, options shall be granted and the number of shares subject to each
option; (ii) prescribe, amend and determine the provisions of options granted
under the Plan (which need not be identical) and, with the consent of the
holder thereof, amend or modify any option; (iii) determine the provisions of
options granted under the Plan (which need not be identical) and with the
consent of the holder thereof, amend or modify any option; (iv) interpret the
Plan and the respective options; and (v) make all other determinations
necessary or advisable for administering the Plan. All determinations and
interpretations by the Committee shall be binding upon all parties. No member
of the Committee or the Board shall be liable for any action or determination
made in good faith in respect of the Plan or any option granted under it.

(d) The provisions of this Section 4 shall survive any termination of the
Plan.

(5) Eligibility for Award of Options

(a) Options may be granted only to Employees. Any reference in the Plan to
"employment by the Company" shall also be deemed to include employment by any
Subsidiary of the Company. Determination by the Committee or the Board, as to
who are eligible Employees shall be conclusive.

(b) A person who is a director of the Company or any Subsidiary shall not
be considered an employee for the purpose of the Plan solely because he or she
is a director. However, a person who is an employee shall not be disqualified
by virtue of being a director of the Company or any Subsidiary.

(6) Option Price

(a) The purchase price of the Common Stock under each option shall be
determined by the Committee. The purchase price shall be at least 100 percent
(100%) of the Fair Market Value on the date of the grant of the option. The
purchase price under an Incentive Stock Option granted to an employee who is a
Ten Percent Stockholder shall be at least 110% of the Fair Market Value on the
date of the grant of the Incentive Stock Option.

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(b) "Fair Market Value", as of the time of any determination by the
Committee, shall mean the closing price of a share of Common Stock on the
immediately preceding business day as reported by the National Association of
Securities Dealers, Inc. through the National Association of Securities Dealers
Automated Quotation System ("NASDAQ") or a similar organization if NASDAQ is no
longer reporting such information.

(7) Federal Income Tax Consequences Under the Plan

The aggregate Fair Market Value of shares of Common Stock with respect to
which Incentive Stock Options are exercisable for the first time by a
Participant during the calendar year (under the Plan or any other plan of the
Company, its Parent, if any and its Subsidiaries) shall not exceed the sum of
$100,000. Such aggregate Fair Market Value shall be determined as of the date
such Options is granted.

Incentive Stock Options

For Incentive Stock Options, the optionee will not realize any taxable
income upon receipt of shares upon the exercise of the option. However, the
excess of the Fair Market Value of the stock on the date of exercise over the
exercise price is an item of adjustment to be taken into account in determining
whether the "alternative minimum tax" will apply for the year of exercise. If
the shares acquired upon exercise are held at least two years from the date of
grant and one year from the date of exercise, any gain or loss upon the sale of
such shares, if held as capital assets, will be long-term capital gain or loss
(measured by the difference between the sales price of the stock and the
exercise price). If the two year and one year holding periods are not met (a
"disqualifying disposition"), an optionee will realize ordinary income in the
year of disposition in an amount equal to the lesser of (i) the Fair Market
Value of the stock on the date of exercise minus the exercise price or (ii) the
amount realized on disposition minus the exercise price. The remainder of the
gain will be treated as long-term or short-term gain depending upon whether the
stock has been held for more than twelve months. If an optionee makes a
disqualifying disposition, the Company will be entitled to a tax deduction
equal to the amount of ordinary income recognized by the optionee.

In general, if an optionee in exercising an Incentive Stock Option tenders
shares of Common Stock in partial or full payment of the option price, no gain
or loss will be recognized on the tender. However, if the tendered shares were
previously acquired upon the exercise of another Incentive Stock Option and the
tender is within two years from the date of grant or one year after the date of
exercise of the other Incentive Stock Options, the tender will be a
disqualifying disposition of the shares acquired upon exercise of the other
Incentive Stock Option.

As noted above, the exercise of an Incentive Stock Option could subject
the optionee to the alternative minimum tax. The application of the alternative
minimum tax to any particular optionee depends upon the particular facts and
circumstances which exist with respect to the optionee in the year of exercise.
However, as a general rule, the amount by which the Fair Market Value of the
Common Stock on the date of exercise of an option exceeds the exercise price of
the option will constitute an item of adjustment for purposes of the
alternative minimum tax. As such, this item will enter into the tax base on
which the alternative minimum tax is computed, and may therefore cause the
alternative minimum tax to become applicable in a given year. (alternative
minimum tax, if applicable, would be incurred equal to 26% of the excess
alternative minimum taxable income up to $175,000 and 28% for any amount in
excess of $175,000).

Non-Qualified Stock Options

Non-Qualified Stock Options granted under the 1997 Plan do not qualify as
Incentive Stock Options and will not qualify for any special tax benefits to
the optionee. An optionee generally will not recognize any taxable income at
the time he or she is granted an Non-Qualified Stock Option. However, upon its
exercise, the optionee will recognize ordinary income for Federal tax purposes
measured by the excess of the then Fair Market Value of the shares over the
exercise price. The income realized by the optionee will be subject to income
and other employee withholding taxes. Generally upon exercise of a
Non-Qualified Stock Option, the Company will be entitled to a deduction for
Federal income tax purposes equal to the amount of ordinary income that an
optionee is required to recognize as a result of the exercise.

The optionee's basis for determination of gain or loss upon the subsequent
disposition of shares acquired upon the exercise of a Non-Qualified Stock
Option will be the amount paid for such shares plus any ordinary

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<PAGE>

income recognized as a result of the exercise of such option. Upon disposition
of any shares acquired upon the exercise of a Non-Qualified Stock Option, the
difference between the sale price and the optionee's basis in the shares will
be treated as a capital gain or loss and generally will be characterized as a
long-term capital gain or loss if the shares have been held for more than one
year at their disposition.

Tax Rates

(8) Terms and Exercise of Options

(a) Maximum 10 Year Termination Date. Each option shall expire no later
than ten years after the date on which it shall have been granted, but the
Committee in its discretion may prescribe a shorter period for any individual
option or options. Any Incentive Stock Option granted to a person who is a Ten
Percent Stockholder shall terminate no later than 5 years after the date on
which the Incentive Stock Option was granted. The date of termination pursuant
to this paragraph is referred to hereinafter as the "termination date of the
option."

(b) Vesting.

(i) Options shall be exercisable at such times and in such installments,
if any, as the Committee may determine. In the event any option is
exercisable in installments, any shares which may be purchased during
any year or other period which are not purchased during such year or
other period may be purchased at any time or from time to time during
any subsequent year or period during the term of the option unless
otherwise provided in the Stock Option Agreement.

(ii) While the Committee may set any vesting schedule which it wishes,
it is the expectation of the Board in adopting this Plan that the
options vest during a period of up to five years after the date of
grant. For example, the Committee may provide that only 25% of the
shares granted under the option may be purchased during the first year
after the date of grant, an additional 25% of the shares may be
purchased commencing two years after the date of grant and 100% of the
stock may be purchased only 4 years after the date of the grant.

(iii) In connection with any proposed sale or conveyance of all or
substantially all of the assets of the Company or of any proposed
consolidation or merger of the Company or of any proposed Change
Control of the Company, the Board in its discretion may accelerate the
vesting schedule of any or all options. In the event the Board does
determine to accelerate the vesting schedule, it shall notify each
holder of an option whose vesting schedule has been accelerated.

(c) Means of Exercise of Option. An option shall be exercised by written
notice to the Secretary or Treasurer of the Company at its principal office.
The notice shall specify the number of shares as to which the option is being
exercised and shall be accompanied by payment in full of the purchase price for
such shares. An optionee at his discretion may, in lieu of cash payment,
deliver Common Stock already owned, with a Fair Market Value (on the date of
exercise) equal to the purchase price for the shares being acquired pursuant to
exercise of the option, as payment for the exercise of any option. In the event
an option is being exercised in whole or in part, by any person other than the
optionee, a notice of election shall be accompanied by proof satisfactory to
the Company of the rights of such person to exercise said option. An optionee
shall not, by virtue of granting of an option, be entitled to any rights of a
shareholder in the Company and he shall not be

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<PAGE>

considered a record holder of shares purchased by him until the date on which
he shall actually be recorded as the holder of such shares upon the stock
records of the Company. The Company shall not be required to issue any
fractional shares upon exercise of any option and shall not be required to pay
to the person exercising the option the cash equivalent of any fractional share
interest unless so determined by the Committee.

(d) Options are Non-Transferable. No stock option may be transferred by
the optionee (except in connection with death or disability as provided in
Section 8 (j).

(e) Options Lapse 3 Months After Termination of Employment. In the event
of the termination of an optionee's employment by the Company or its
Subsidiaries at any time for any reason (excluding disability or death), his
option and all rights thereunder shall be exercisable by the optionee at any
time within three (3) months thereafter but only to the extent exercisable by
him on the date of termination of his employment and in no event later than the
termination date of his option.

(f) Options Exercisable 12 Months After Termination in the Event of
Disability. In the event an employee is permanently and totally disabled
(within the meaning of Section 422 (c) (6), or any successor section, of the
Code), his option and all rights thereunder shall be exercisable by the
optionee at any time within twelve (12) months of his termination of
employment, but in no event later than the termination date of the option.

(g) Options Exercisable 12 Months After Date of Death. If an optionee
shall die while in the employ of the Company or any of its Subsidiaries, his
option may be exercised within twelve (12) months after the date of his death,
but only to the extent exercisable by the optionee at his death and the option
may not be exercised later than the termination date of the option.

(h) No Right to Continued Employment. Nothing in the Plan or in any option
granted pursuant hereto shall confer on any individual any right to continue in
the employ of the Company or any of its Subsidiaries or prevent or interfere in
any way with the right of the Company or its Subsidiaries to terminate his
employment at any time, with or without cause.

(i) Options Must Be Evidenced by Writing. Each option granted pursuant to
the Plan shall be evidenced by a written Stock Option Agreement, duly executed
by the Company and the optionee, in such form and containing such provisions as
the Committee may from time to time authorize or approve.

(j) In the event of an Employee's death or disability (within the meaning
of Section 422(c)(6), or any successor section, of the Code), such Employee's
Designated Beneficiaries, legal representative or executor shall have the right
to exercise such Employee's options to the same extent as such Employee would
have under Sections 8(e), (f) or (g), as applicable, as of the date on which
such Employee's employment by the Company or any Subsidiary terminated.

(9) Adjustments

The Stock Option Agreement shall contain appropriate provisions for the
adjustment of the kind and number of shares subject to each outstanding option
and the purchase price under each option in the event of any changes in the
outstanding Common Stock of the Company by reason of stock dividends, stock
splits, recapitalization, reorganizations, mergers, consolidations,
combinations or exchanges of shares, and the like. In the event of any such
change or changes in the outstanding Common Stock, and as often as the same
shall occur, the kind and aggregate number of shares available under the Plan
shall be appropriately adjusted by the Committee or Board, whose determination
shall be binding and conclusive.

(10) Amendment and Termination

(a) Unless the Plan shall have been sooner terminated as provided herein,
no incentive stock option shall be granted hereunder after April 24, 2007. The
Board may at any time suspend or terminate the Plan as it may deem advisable,
except that it may not without further shareholder approval (i) increase the
maximum number of shares subject to the Plan (except for changes pursuant to
Section 9), (ii) extend the period during which options may be granted or
exercised or (iii) make any other change unless the Board determines that the
change would not materially increase the cost of the Plan to the Company.
Except as otherwise hereinafter provided, no

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<PAGE>

alteration, suspension or termination of the Plan may, without the consent of
the Employee to whom any option shall have theretofore been granted (or the
person or persons entitled to exercise such option under Section 8 (f) or (g)
of the Plan), terminate his option or adversely affect his rights thereunder.

(b) Anything herein to the contrary notwithstanding, in the event that the
Board shall at any time declare it advisable to do so in connection with any
proposed sale or conveyance of all or substantially all of the assets of the
Company or of any proposed consolidation or merger of the Company, the Company
may give written notice to the holder of any option that his option may be
exercised only within thirty (30) days after the date of such notice but not
thereafter, and all rights under said option which shall not have been so
exercised shall terminate at the expiration of such thirty (30) days, provided
that the proposed sale, conveyance, consolidation or merger to which such
notice shall relate shall be consummated within six (6) months after the date
of such notice.

In the event such notice shall have been given, any such option may be
exercised either in whole or in part notwithstanding the vesting period
required under the terms of the option for the exercise thereof. If such
proposed sale, conveyance, consolidation or merger shall not be consummated
within said time period, no unexercised rights under any option shall be
affected by such notice except that such option may not be exercised between
the date of expiration of such thirty (30) days and the date of the expiration
of such six (6) months.

(11) Indemnification

Any member of the Committee or the Board who is made, or threatened to be
made, a party to any action or proceeding, whether civil or criminal, by reason
of the fact that he is or was a member of the Committee or the Board insofar as
relates to the Plan shall be indemnified by the Company, and the Company may
advance his related expenses, to the full extent permitted by law and/or the
By-Laws of the Company.

(12) Effective Date of the Plan

The Plan shall become effective on, and options may be granted thereunder
after April 24, 1997, provided, however, that if the Plan shall not be approved
by the holders of a majority of the outstanding voting stock of the Company
within twelve months of said date, the Plan and all options granted thereunder
shall be and become null and void, and provided, further, that no options
granted by the Committee may be exercised prior to the approval of the Plan by
shareholders.

(13) Expenses

The Company shall pay all fees and expenses incurred in connection with
the establishment and administration of the Plan.

(14) Government Regulations, Registration, and Listing of Stock

(a) The Plan, and the grant and exercise of options thereunder, and the
Company's obligation to sell and deliver stock under such options, shall be
subject to all applicable federal and state laws, rules and regulations and to
such approvals by any regulatory or governmental agency as may be required.

(b) Unless a registration statement under the Securities Act of 1933 and
the applicable rules and regulations thereunder (collectively the "Act") is
then in effect with respect to shares issued upon exercise of any option (which
registration shall not be required), the Company shall require that the offer
and sale of such shares be exempt from the registration provisions of said Act.
In furtherance of such exemption, the Company may require, as a condition
precedent to the exercise of any option, that the person exercising the option
give to the Company a written representation and undertaking, satisfactory form
and substance to the Company, that he is acquiring the shares for his own
resale thereof and otherwise establish to the Company's satisfaction that the
offer or sale of the shares issuable upon exercise of the option will not
constitute or result in any breach or violation of the Act of any similar state
act or statute of any rules or regulations thereunder. In the event a
registration statement under the Act is not then in effect with respect to the
shares of Common Stock issued upon exercise of an option, the Company shall
place upon any stock certificate an appropriate legend referring to the
restrictions on disposition under the Act.

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<PAGE>

(c) In the event the class of shares issuable upon the exercise of any
option is listed on any national securities exchange, the Company shall not be
required to issue or deliver any certificate for shares upon the exercise of
any option prior to the listing of the shares so issuable on such national
securities exchange and prior to the registration of the same under the
Securities Exchange Act of 1934 or any similar act or statute.

A-7

<PAGE>

Please mark
your votes as
indicated in
this example.

This proxy will be voted as specified below. If no choice is specified,
the proxy will be voted FOR the election of the four nominees for director shown
below and FOR the amendment to the Company's 1997 Stock Option Plan.

The Board of Directors recommends a vote FOR each of the proposals.

PROPOSAL 1 - ELECTION OF FOUR DIRECTORS FOR TERMS EXPIRING IN 2003:

Lorraine Buklad, Sidney L. Hofing,
James J. Kelly and Louizs R. Matlack

INSTRUCTIONS: To withhold authority to vote for any individual nominee,
write that nominee's name on the following line.

- ----------------------------------------------------------------------------
PROPOSAL 2 - AMENDMENT TO THE COMPANY'S 1997 STOCK OPTION PLAN INCREASING THE
NUMBER OF OPTIONS BY 660,000 TO ACQUIRE SHARES OF THE COMPANY'S COMMON STOCK.

FOR all nominees listed
(except as marked to the contrary)

WITHHOLD AUTHORITY
to vote for all nominees listed

FOR

AGAINST

ABSTAIN

Please sign exactly as name appears. When shares are held by joint tenants, both
should sign. When signing as attorney, executor, administrator, trustee or
guardian, please give your title as such. If a corporation, please sign in full
corporate name by President or other authorized officer. If a partnership,
please sign in partnership name by authorized person. PLEASE SIGN, DATE AND
RETURN THIS PROXY IN THE ENCLOSED ENVELOPE.

Signature(s)______________________________________________Date____________, 2000

- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE>

YARDVILLE NATIONAL BANCORP
PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS
TUESDAY, MAY 2, 2000
Solicited on Behalf of the Board of Directors

The undersigned hereby appoints Elbert G. Basolis, Jr. and Gilbert W.
Lugossy and each of them, as Proxy, each with full power of substitution, to
vote all of the shares of YARDVILLE NATIONAL BANCORP standing in the under-
signed's name at the Annual meeting of Shareholders of Yardville National
Bancorp, to be held at La Villa Ristorante, 2275 Kuser Road, Hamilton, New
Jersey on Tuesday, May 2, 2000 at 10:00 A.M., and at any postponement or
adjournment thereof, as indicated on the reverse side with respect to the
election of directors, amendment to the 1997 Stock Option Plan, and in
accordance with the recommendations of the Board of Directors on all other
matters that come before the meeting. The undersigned hereby revokes any and all
proxies heretofore given with respect to such meeting.

(Continued and to be signed on the reverse side)