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Community Banks and PennRock Finalize Merger
HARRISBURG, Pa., July 1 /PRNewswire-FirstCall/ -- The Board of Directors of
Community Banks, Inc. (NASDAQ:CMTY) today announced the consummation of its
merger with PennRock Financial Services Corp. (NASDAQ:PRFS), parent company of
Blue Ball National Bank. This combination has resulted in the blending of two
franchises that currently boast nearly $3.5 billion in combined assets and over
70 branch offices in 11 counties throughout the geographic center of
Pennsylvania; extending from the Pocono region in the north to just across the
Pennsylvania and Maryland border. Pursuant to the merger, Community has now
become the 8th largest bank holding company headquartered in the Commonwealth
of Pennsylvania, a substantial jump from its current 12th place ranking.
"Due to the untiring efforts of our employees, and the loyalty of our valued
customers from both PennRock and Community, our new franchise is now in a
position to assume an even more prominent role in the delivery of financial
services to the most vibrant areas of Pennsylvania and northern Maryland," said
Eddie L. Dunklebarger, President and CEO of Community Banks, Inc. "We are
extremely optimistic about the future of our newly-constructed financial
services franchise, which has been built on the foundation of local people
making local decisions in the communities that we serve."
Both Community and PennRock have been among the fastest-growing banks in the
Central Pennsylvania market. Growth has been influenced by the favorable
demographics within their attractive primary markets, the positive effect of
organic office expansion, and by the acquisition of a number of integrated
financial service businesses. Furthermore, both franchises have benefited from
the diminishing presence of larger banks that are no longer headquartered
within the region.
Prior to the consummation, Community has recorded certain non-recurring and
merger-related expenses that will be reflected in second quarter results in
2005 that are expected to be released on or near July 18. Operating results
for the newly combined Community and PennRock will commence on July 1, 2005.
The 2005 third quarter results will represent the first full quarter of
combined operating results on a post-consummation basis. In addition to the
aforementioned expenses, Community also completed a balance sheet
restructuring, involving the repayment of certain debt, to coincide with the
consummation in order to maximize operating profits on a prospective basis. As
a consequence, Community expects to record substantially less net income in the
second quarter of 2005 than for the same period in 2004.
"Throughout the integration process, our twofold goal was to work together for
a seamless transition for our customers, employees and communities and,
secondly, to make certain that we are positioned to 'hit the ground running' in
the second half of 2005 and at the beginning of 2006," said Mr. Dunklebarger.
"While there will be some additional coordination and consolidation that will
need to take place prior to the end of this calendar year, we believe we are on
track to meet our expectations in regards to the efficiencies realized from the
merger."
This press release contains "forward-looking" information as defined by the
Private Securities Litigation Reform Act of 1995, which is based on Community's
current expectations, estimates and projections about future events and
financial trends affecting the financial condition of its business. These
statements are not historical facts or guarantees of future performance,
events, or results. Such statements involve potential risks and uncertainties
and, accordingly, actual performance results may differ materially. Community
undertakes no obligation to publicly update or revise forward-looking
information, whether as a result of new, updated information, future events, or
otherwise.
DATASOURCE: Community Banks, Inc.
CONTACT: Donald F. Holt, EVP/CFO, Community Banks, +1-717-920-5801, Fax:
+1-717-920-1683
Web site: http://www.communitybanks.com/