Interchange Financial Services Corporation Declares Quarterly Cash Dividend

On July 19, 2005, Interchange Financial Services
Corporation ("Interchange"), the holding company for Interchange Bank,
declared a quarterly cash dividend of $0.09 per common share payable
on August 19, 2005, to holders of record as of August 1, 2005. This
dividend represents $0.36 per share on an annualized basis. Based upon
the closing price of the stock as quoted on July 19, 2005, of $19.10
the yield is 1.88%.

   About Interchange Financial Services Corp.

   Interchange Financial Services Corporation (NASDAQ:IFCJ)
wholly-owns Interchange Bank, one of Bergen County's largest
independent commercial banks. A thought leader in the industry, the
Bank was among the first to implement a broad range of innovative
services, including 24-hour, 7-day-a-week online banking and bill
paying services, online stock trading, and the ability to apply for a
loan online with an instant credit decision. Mutual funds and
annuities are offered by ICBA Financial Services, through the Bank's
investment department. With $1.5 billion in assets and 30 branches,
the Bank focuses its efforts on the local communities from which it
derives deposits and generates loans. Through Interchange Bank's
subsidiary, Interchange Capital Company, L.L.C., cost effective
equipment leasing solutions are available to small- and middle-market
companies. For additional information, please visit the company's Web
site at www.interchangebank.com.

   "Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995: Statements in this press release regarding
Interchange Financial's business which are not historical facts are
"forward-looking statements" that involve risks and uncertainties. For
a discussion of such risks and uncertainties, which could cause actual
results to differ from those contained in the forward-looking
statements, see "Risk Factors" in the Company's Annual Report or Form
10-K for the most recently ended fiscal year.