Home Somerset business SOMERSET SAVINGS BANK TO CONDUCT THE CONVERSION AND ASSOCIATED SHARE OFFERING AND TO MERGE WITH REGAL BANCORP, INC.

SOMERSET SAVINGS BANK TO CONDUCT THE CONVERSION AND ASSOCIATED SHARE OFFERING AND TO MERGE WITH REGAL BANCORP, INC.

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As part of the conversion, the boards of directors of Somerset Savings and SR Bancorp have entered into a definitive merger agreement with Regal Bancorp, Inc. (“Regal Bancorp”) and its subsidiary Regal Bank. As part of the merger, Regal Bancorp will merge with and into SR Bancorp, with SR Bancorp as the surviving entity, and Regal Bank will merge with and into Somerset Savings, with Somerset Savings as the surviving institution under the name Somerset Regal Bank. As part of the conversion and merger, Somerset Savings also intends to convert into a New Jersey chartered commercial bank.

The conversion plan establishes June 30, 2021 as the Eligibility Record Date for determining eligible Somerset Savings account holders entitled to receive non-transferable subscription rights to purchase Common Shares. The transactions contemplated by the plan are subject to the approval of (1) the voting members of Somerset Savings at a special meeting of members; (ii) the Federal Deposit Insurance Corporation and (iii) the New Jersey Department of Banking and Insurance (the “Department”). The formation of the holding company as the parent company of Somerset Savings is subject to the approval of the Board of Governors of the Federal Reserve and the Department, if necessary.

Pursuant to the terms of the merger agreement, Regal Bancorp shareholders may elect to receive 1.93 common shares of SR Bancorp, Inc. (based on a $10.00 offer price per share) or $19.30 in cash for each share of Regal Bancorp common stock, subject to the allotment and pro-rating procedures set forth in the merger agreement, which require that 80% of the merger consideration be common stock of the company and 20 % of the Merger Consideration is cash. If SR Bancorp issues a number of shares of its common stock under its conversion share offer that is greater than the midpoint of the range of offers established in the independent valuation, the aggregate share of the shares of the merger consideration will be increased to 90%. The total transaction value of the merger is approximately $58.4 million.

The merger agreement has been approved by the boards of directors of the company, Somerset Savings, Regal Bancorp and Regal Bank. The merger is subject to the approval of Regal Bancorp shareholders and the completion of the conversion and offering of company shares. In addition, the conversion is subject to the approval of the members of Somerset Savings. The transactions are also subject to the approval of banking regulatory authorities, as well as other customary conditions. The conversion, offering and merger are expected to be completed in the second quarter of 2023 and will be consummated concurrently.

By announcing the transaction, William P. TaylorChairman and CEO of Somerset Savings, said: “The simultaneous conversion and merger with Regal Bancorp, together with our conversion to a chartered commercial bank, marks a turning point in the history of Somerset Savings. This transaction not only combines two highly respected community banking organizations creating a combined franchise with complementary lines of business and more $1 billion in total assets, but also provides our depositors with the opportunity to benefit as shareholders of the combined organization and enables our clients to benefit from the commercial lending expertise that the Regal team brings to the combined company. Finally, the additional capital we will raise under the offering will help support future growth as we continue our development as a full-service community bank.”

Christopher PribulaPresident, Chief Operating Officer and Director of Somerset Savings, said: “We look forward to partnering with the Regal team and providing a wide range of products and services to our combined customer base with the same level of service quality customer which has been the hallmark of Somerset Savings Bank and Regal Bank. »

Regal Bancorp’s Executive Chairman, David M. Orbach, and two other Regal Bancorp board members will join the boards of SR Bancorp and Somerset Regal Bank following the merger transaction. Mr. Orbach will serve as Executive Chairman of the Board of SR Bancorp and Executive Vice Chairman of the Board of Somerset Regal Bank. Mr. Taylor will continue as CEO and Chairman of the Board of Somerset Regal Bank and serve as CEO and Director of SR Bancorp. Christopher Pribula will remain President, Chief Operating Officer and Director of Somerset Regal Bank and SR Bancorp.

Commenting on the transaction, David Orbach said, “Regal shares a similar philosophy with the leaders of Somerset in their management style and their adherence to sound principles. We are very pleased to partner with an exceptional community bank that has a long history of providing quality financial products and services to the communities and markets it serves. I look forward to working together on the future growth and success of the combined institution.”

Thomas LupoPresident and CEO of Regal, said, “The merger represents a great opportunity for our shareholders, customers and employees. It will benefit clients of both institutions, allowing us to offer our commercial lending products and knowledge to Somerset customers, while Regal customers will benefit from of Somerset residential lending products and experience. »

Somerset Savings was advised by Keefe, Bruyette & Woods, a Stifel company and Luse Gorman, PC. Regal Bancorp was advised by The Kafafian Group, Inc. and Windels Marx Lane & Mittendorf, LLP.

About Somerset Savings

Somerset Savings Bank, SLA established in 1887, is a New Jersey savings and credit association. Somerset Savings is a full-service community bank headquartered in Bound Brook, New Jersey which operates seven branches in Hunterdon, middlesex and Somerset Counties, New Jersey. To March 31, 2022Somerset Savings had $649.0 million in total assets, $317.0 million in net loans, $525.0 million in deposits and total equity of $120.2 million. Additional information about Somerset Savings is available on its website, www.somersetsavings.com.

About Regal Bancorp

Regal Bancorp, Inc., which became Regal Bank’s bank holding company in 2017, is a New Jersey company and is registered with the Federal Reserve Board as a bank holding company. Regal Bank, established in 2007, is a full-service community bank headquartered in Livingstone, New Jersey which operates ten branches in Essex, Morris, Somerset and union Counties, New Jersey. To March 31, 2022Regal Bancorp had $544.7 million in total assets, $345.7 million in net loans, $480.5 million in deposits and total equity of $46.7 million. Additional information about Regal Bank is available on its website, www.regalbanknj.com.

Forward-looking statements

This press release contains forward-looking statements. Forward-looking statements are not historical or current facts and often include words such as “believe”, “expect”, “anticipate”, “estimate”, “intend” or similar terminology. Factors that could cause actual results to differ materially from those expected include delays in the completion of the liquidation and dissolution. Except as required by law, neither the Company, Somerset Savings, Regal Bancorp nor Regal Bank undertakes to update forward-looking statements to reflect circumstances or events occurring after the date on which the forward-looking statement is done.

Further information

The offering by the Company will be made only by way of prospectus in accordance with the Securities Act of 1933, as amended, and all applicable state securities laws. This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities.

The proposed transaction will be submitted to Regal Bancorp shareholders for consideration. The Company will file a registration statement, proxy statement/prospectus and other relevant documents regarding the proposed transaction with the Securities and Exchange Commission (the “SEC”). Regal Bancorp stockholders are urged to read the registration statement and proxy statement/prospectus when they become available and any other relevant documents filed with the SEC, as well as any amendments or supplements thereto, as they will contain important information. You may obtain a free copy of the proxy statement/prospectus, as well as other documents containing information about the Company, on the website of the SEC (http://www.sec.gov). Copies of the proxy statement/prospectus and documents filed with the SEC which will be incorporated by reference in the proxy statement/prospectus may be obtained, free of charge, by directing a request to Lisa KingInvestor Relations, Regal Bancorp, 570 West Mount Pleasant Avenue, Livingstone, New Jersey 07039, 973-716-0600.

The directors and executive officers of Regal Bancorp may be deemed to be participating in the solicitation of proxies from Regal Bancorp shareholders in connection with the merger. Information about the directors and officers of Regal Bancorp and their ownership of Regal Bancorp common stock can be found in its definitive proxy statement relating to its 2022 annual meeting of shareholders, which may be obtained free of charge from Regal Bancorp by sending a request to Lisa KingInvestor Relations, Regal Bancorp, 570 West Mount Pleasant Avenue, Livingstone, New Jersey 07039, 973-716-0600. Additional information regarding the interests of such participants and other persons who may be considered participants in the transaction may be obtained by reading the proxy statement/prospectus relating to the proposed transaction when it becomes available.

Somerset Savings Bank