NEWYORK,OCTOBER26,2015: ESBANCSHARES,INC.REPORTSSEPTMEBER30,2015QUARTERLYEARNINGSOF$98THOUSAND,OR$0.03PERCOMMONSHARE,ASCOMPAREDTO$113THOUSAND,OR$0.03PERCOMMONSHAREFORTHEQUARTERENDEDSEPTMBER30,2014. FINANCIALHIGHLIGHTS Neteof$98thousandforthequarterendedSeptember30,paredto$113thousandforparableperiodin2014,representingadecreaseof$15thousand,or13%. Neteof$312thousandfortheyeartodateendedSeptember30,paredto$369thousandforparableperiodin2014,representingadecreaseof$57thousand,or15%. Netebeforetaxesof$190thousandforthequarterendedSeptember30,paredto$131thousandforparableperiodin2014,representinganincreaseof$59thousand,or45%. Netebeforetaxesof$575thousandfortheyeartodateendedSeptember30,paredto$433thousandforparableperiodin2014,representinganincreaseof$142thousand,or33%. Netinteresteof$1.59millionforthequarterendedSeptember30,paredto$1.46millionforparableperiodin2014,representinganincreaseof$13thousand,or0.9% Netmarginof3.50%forthequarterendedSeptember30,paredto3.70%forparableperiodin2014,representingadecreaseof20bps,or5.4%. Increaseinnonperformingassetsof$1.3million,or86.7%,from$1.5millionatSeptember30,2014to$2.8millionatSeptember30,2015. Capitalratiosof8.4%,10.8%and12.0%foreachoftheTier1Leverageratio,Tier1RiskBasedCapitalratioandTotalriskBasedCapitalratio,respectively. ComparisonofFinancialConditionatSeptember30,2015andDecember31,2014 TotalassetsatSeptember30,2015,amountedto$187.5million,representingadecreaseof$272thousand,or0.1%,from$187.8millionatDecember31,2014.Thisdecreasepartiallyresulteddecreasesincashandcashequivalentsof$13.7millionandFHLBstockof$535thousand.Thesedecreaseswerepartiallyoffsetincreasesinloansreceivable,,of$13.3million,otherassetsof$249thousand,andtotalsecuritiesof$247thousand. Loansreceivable,,increased$13.3million,or9.6%,to$152.4millionatSeptember30,2015from$139.1millionatDecember31,2014.Commercialloans,includingtaximedallionandUSgovernmentagencyguaranteedloans,merciallinesofcreditdecreased$5.2million,or11.0%,from$47.2millionto$42.0million.Commercialandmultifamilyrealestateloansincreased$10.5million,or15.8%,from$66.5millionto$77.0million.Homeequityandconsumerloansdecreased$381thousandto$5.8millionatSeptember30,2015.Residentialrealestatemortgageloansincreased$8.4million,or42.4%,from$19.8millionto$28.2million. Page1 Managementcontinuestoemphasizetheoriginationofhighqualityloansforretentionintheloanportfolio. Depositsincreasedby$12.7millionto$158.9millionatSeptember30,2015from$146.2millionatDecember31,2014.Non-interestbearingdepositsincreased$9.0millionandinterestbearingdepositsincreased$3.6million.OverthisninemonthperioddepositactivityconsistedmainlyofincreasesinDDAandNOWountsof$9.8million,moneymarketandsavingsountsof$7.3million,andcertificatesofdepositof$1.5millionpartiallyoffsetbydecreaseinbrokeredcertificatesofdepositof$6.0million. Borrowingsdecreasedby$12.1millionto$9.4millionatSeptember30,2015from$21.5millionatDecember31,2014 Stockholders’equityincreasedby$302thousandto$15.6millionatSeptember30,2015,from$15.3millionatDecember31,2014.Theincreasewasprimarilyattributabletoa$312thousandincreaseinretainedearnings.Theratioofstockholders’equitytototalassetsincreasedto8.3%atSeptember30,2015from8.2%atDecember31,2014.Bookvaluepershareincreasedto$4.71atSeptember30,2015,from$4.62atDecember31,2014. Page2 ESBANCSHARES,INC.STATEMENTSOFCONDITION(InThousands)(Unaudited) ASSETS Cashandcashequivalents: Securities-AvailableForSaleSecurities-HeldToMaturityTotalSecurities 9/30/20156/30/20153/31/201512/31/2014 $9,038$19,233$7,596$22,723 4,84112,43817,279 4,12912,93217,061 4,46011,86916,329 4,75412,27817,032 Loansheldforsale - - - - LoansLess:allowanceforloanlossesLoans, 154,627(2,204) 152,423 151,322(2,154) 149,168 150,906(2,143) 148,763 141,195(2,105) 139,090 Premisesandequipment,OtherassetsTotalAssets 3,3555,422$187,517 3,3735,963$194,798 3,3166,036$182,040 3,3335,611$187,789 LIABILITIESANDSHAREHOLDERS'EQUITY Deposits: DemandandNOWdepositounts $60,506$68,842 Moneymarketounts 26,815 27,382 Savingsounts 18,173 13,847 Certificatesofdeposit 53,366 56,068 TotalDeposits 158,860 166,139 $54,29228,7259,64653,708146,371 $50,67828,4979,22657,848146,249 BorrowingsOtherLiabilitiesTotalLiabilities 9,4423,606171,908 10,4572,695179,291 17,4722,777166,620 21,4874,746172,482 TotalShareholders'EquityTotalLiabilitiesandShareholders'Equity 15,609$187,517 15,507$194,798 15,420$182,040 15,307$187,789 Page3 ResultsofOperationsfortheQuartersEndedSeptember30,2015andSeptember30,2014 General.ForthequarterendedSeptember30,2015,theCompanyeof$98thousand,or$0.03perbasicanddilutedshare,paredeof$113thousand,or$0.03perbasicanddilutedshare,forthequarterendedSeptember30,2014. Intereste.Interesteincreasedto$1.90millionforthequarterendedSeptember30,paredto$1.75millionforthequarterendedSeptember30,2014. Theaveragebalanceoftheloanportfolioincreasedto$154.2millionforthequarterendedSeptember30,2015from$132.6millionforthequarterendedSeptember30,2014whiletheaverageyielddecreasedto4.53%forthequarterendedSeptember30,2015from4.82%forthequarterendedSeptember30,2014.TheaveragebalanceandyieldoftheBank’sinvestmentsecuritiesforthequarterendedSeptember30,2015was$17.1millionand3.11%,respectively,paredtoanaveragebalanceof$17.9millionandayieldof3.03%forparablequarterendedone-yearearlier. InterestExpense.TotalinterestexpenseforthequarterendedSeptember30,2015,increasedby$23thousandto$314thousandfrom$291thousandfortheprioryearperiod.Averagebalancesoftotalinterest-bearingliabilitiesincreased$13.0millionto$130.0millionforthequarterendedSeptember30,2015,from$117.0millionforthequarterendedSeptember30,2014.Theaveragecostforthoseliabilitiesdecreasedto0.95%from0.99%forthesamerespectiveperiodoneyearearlierreflectinglowermarketinterestrates. TheaveragebalancesoftheBank’scertificatesofdepositportfolioincreasedto$54.6millionatanaveragecostof1.29%overthequarterendedSeptember30,2015,from$47.0millionatanaveragecostof1.37%overthesamequarterendedone-yearearlier.Regularsavingsountaveragebalancesincreasedto$15.9million,from$10.2millionforthequarterendedSeptember30,2014.Thesehadanaveragecostof0.62%forthequarterendedSeptember30,paredtoanaveragecostof0.31%forthequarterendedSeptember30,2014. Averagemoneymarketountbalancesdecreased$2.6millionto$27.3millionatanaveragecostof0.45%forthequarterendedSeptember30,2015,from$29.9millionatanaveragecostof0.46%forthequarterendedSeptember30,2014. ForthequarterendedSeptember30,2015,theaveragebalanceoftheCompany’sborrowedfundswas$12.9millionwithanaveragecostof1.82%,paredto$15.1millionandanaveragecostof1.81%forthequarterendedSeptember30,2014. NetIntereste.Netinteresteincreased$125thousandfrom$1.5millionforthequarterendedSeptember30,2014,to$1.6millionforthequarterendedSeptember31,2015.Ouraverageinterestratespreaddecreasedto3.23%forthequarterendedSeptember30,2015,from3.45%forthequarterendedSeptember30,2014,whileinterestmargindecreasedto3.50%from3.70%,overthesamerespectiveperiods. ProvisionforLoanLosses.ForthequarterendedSeptember30,2015,managementrecordeda$50thousandprovisionforloanlosses.Comparatively,therewas$20thousandprovisionforloanlossforthequarterendedSeptember30,2014. Page4 Non-Intereste.Non-interesteforthequarterendedSeptember30,2015increased$239thousandto$443thousandparedto$204thousandforthequarterendedSeptember30,2014.Gainonloansalesincreased$139thousandto$189thousandforthequarterendedSeptember30,2015. Non-InterestExpense.Non-interestexpenseforthequarterendedSeptember30,2015increased$275thousandparedtothesamequarterin2014,primarilyresultingincreasesof$156thousandpensationandbenefitsexpense,$62thousandofupancyandequipmentexpense,and$51thousandforprofessionalfees. eTaxExpense.etaxexpensewas$92thousandforthequarterendedSeptember30,2015paredto$18thousandforthequarterendedSeptember30,2014.Thisincreaseintaxprovisionisprimarilytheresultoftheremovalofavaluationallowanceonthedeferredtaxassetduringthefourthquarterof2014. ResultsofOperationsfortheNineMonthsEndedSeptember30,2015andSeptember30,2014 General.FortheninemonthsendedSeptember30,2015,theCompanyeof$312thousand,or$0.09perbasicanddilutedshare,paredeof$369thousand,or$0.11perbasicanddilutedshare,fortheninemonthsendedSeptember30,2014. Intereste.Interesteincreasedby$439thousand,from$5.2millionto$5.7million,fortheninemonthsendedSeptember30,paredtotheninemonthsendedSeptember30,2014.Thisincreasewasprimarilyattributableincreaseinloansof$475thousand. Theaveragebalanceoftheloanportfolioincreasedto$150.9millionfortheninemonthsendedSeptember30,2015from$128.4millionfortheninemonthsendedSeptember30,2014,whiletheaverageyielddecreasedto4.63%from4.95%fortheninemonthsendedSeptember30,2015andSeptember30,2014.TheaveragebalanceandyieldoftheBank’sinvestmentsecuritiesfortheninemonthsendedSeptember30,2015,was$16.6millionand3.04%,respectively,paredtoanaveragebalanceof$18.7millionandayieldof3.06%forparableninemonthperiodone-yearearlier. InterestExpense.TotalinterestexpensefortheninemonthsendedSeptember30,2015,increasedby$47thousand,from$861thousandto$908thousand,paredtotheprioryearperiod.Averagebalancesoftotalinterest-bearingliabilitiesincreased$15.7millionto$128.9millionfortheninemonthsendedSeptember30,2015,from$113.2millionfortheninemonthsendedSeptember30,2014.Theaveragecostforthoseliabilitiesdecreasedto0.94%from1.01%forthesamerespectiveperiodoneyearearlierreflectinglowermarketinterestrates. TheaveragebalancesoftheBank’scertificatesofdepositportfolioincreasedto$55.9millionatanaveragecostof1.27%overtheninemonthsendedSeptember30,2015,from$47.0millionatanaveragecostof1.42%overthesameperiodone-yearearlier.Regularsavingsountaveragebalancesincreasedby$2.7millionto$12.4million.Thesehadanaveragecostof0.49%fortheninemonthsendedSeptember30,paredtoanaveragecostof0.30%fortheninemonthsendedSeptember30,2014. Page5 Averagemoneymarketountbalancesremainedunchangedat$28.2millionatanaveragecostof0.45%and0.44%fortheninemonthsendedSeptember30,2015andSeptember30,2014,respectively. FortheninemonthsendedSeptember30,2015,theaveragebalanceoftheCompany’sborrowedfundswas$15.5millionanditsaveragecostwas1.57%,paredto$13.9millionandanaveragecostof1.90%fortheninemonthsendedSeptember30,2014. NetIntereste.Netinterestewasapproximately$4.8millionfortheninemonthsendedSeptember30,2015,paredto$4.4millionforthesameperiodintheprioryear.Ourinterestratespreaddecreasedto3.33%fortheninemonthsendedSeptember30,2015,from3.58%fortheninemonthsendedSeptember30,2014,whileinterestmargindecreasedto3.59%from3.84%,overthesamerespectiveperiods. ProvisionforLoanLosses.FortheninemonthsendedSeptember30,2015,managementrecordeda$70thousandprovisionforloanlosses.Comparatively,theprovisionwas$95thousandfortheninemonthsendedSeptember30,2014.Managementrecordsloanlossprovisiontoreflecttheoverallgrowthintheportfolioaswellastheevaluatedriskintheportfolio.TheprovisionrecordedduringtheperiodwasdonesoinconjunctionwiththeBank’sallowanceforloanlossmethodology.Itiscalculatedusingahistoricalcharge-offbasisaswellasotherqualitativefactorswhichreflectmanagement’soverallperceivedriskintheportfolio. Non-Intereste.Non-interestefortheninemonthsendedSeptember30,2015increased$408thousandtoapproximately$1.0millionparedto$600thousandfortheninemonthsendedSeptember30,2014.Theincreaseswereprimarilytheresultincreasesingainonloanssalesof$256thousandanddepositountservicechargeeof$112thousand. Non-InterestExpense.Non-interestexpensefortheninemonthsendedSeptember30,2015increased$683thousandparedtothesameperiodin2014.increasewasprimarilyattributableincreasespensationandbenefitsexpenseof$458thousandandupancy,equipmentof$217thousand.Theseincreaseswerepartiallyoffsetdecreasesinloanoriginationandservicingexpenseof$49thousandandotherexpenseof$43thousand. eTaxExpense.etaxexpensewas$263thousandfortheninemonthsendedSeptember30,2015paredto$64thousandfortheninemonthsendedSeptember30,2014.Thisincreaseintaxprovisionisprimarilytheresultoftheremovalofavaluationallowanceonthedeferredtaxassetduringthefourthquarterof2014. Page6 ESBANCSHARES,INC.STATEMENTSOFINCOME(InThousands)(Unaudited) TotalinteresteTotalinterestexpenseNetinteresteProvisionforloanlosses Netinteresteafterprovisionforloanloss Totalnon-intereste CompensationandbenefitsupancyandequipmentProfessionalfeesDataprocessingservicefeesNYSBanking&FDICAssessmentOtheroperatingexpensesTotalnon-interestexpense NeteBeforeTaxes ProvisionforetaxesNete QuartertoDate 9/30/2015 QuartertoDate 9/30/2014 YeartoDate 9/30/2015 YeartoDate 9/30/2014 $1,899$1,751$5,684$5,245 314 291 908 861 1,585 1,460 4,776 4,384 50 20 70 95 1,535 443 931249180109542651,788 190 9298 1,440 204 77518712996412851,513 131 18113 4,706 1,007 2,776756433326149698 5,138 575 263312 4,289 599 2,318539406301129762 4,455 433 64369 Page7 TotalinteresteTotalinterestexpenseNetinteresteProvisionforloanlosses Netinteresteafterprovisionforloanloss Totalnon-intereste CompensationandbenefitsupancyandequipmentProfessionalfeesDataprocessingservicefeesNYSBanking&FDICAssessmentOtheroperatingexpensesTotalnon-interestexpense NeteBeforeTaxes ProvisionforetaxesNete BasicEarningsperShare DilutedEarningsperShare QuarterEnded9/30/2015 QuarterEnded6/30/2015 QuarterEnded3/31/2015 QuarterEnded12/31/2014 $1,899$1,869$1,916$1,813 314 303 291 288 1,585 1,566 1,625 1,525 50 20
0 245 1,535 1,546 1,625 1,280 443 311 253 645 931
249180109542651,788 915243126111512361,682 930264127106441971,668 1,02821112410742249 1,761 190 175 210 164 92 74 97 (2,363) 98 101 113 2,527 $0.03$0.03$0.03$0.76 $0.03$0.03$0.03$0.76 Page8 ESBANCSHARES,INC. OTHERFINANCIALMEASURES (InThousands) (Unaudited) Quarter Ended 9/30/2015 AssetQuality AllowanceforLoanLosses $2,204 NonperformingLoans/TotalLoans 1.7% NonperformingAssets/TotalAssets 1.5% ALLL/NonperformingLoans 82.6% ALLL/Loans,Gross 1.43% QuarterEnded6/30/2015 $2,1541.8%1.5%79.6%1.43% QuarterEnded3/31/2015 QuarterEnded12/31/2014 $2,143$2,105 1.0% 1.1% 0.9% 0.9% 140.1% 137.5% 1.43% 1.50% Capital SharesIssue-BasicBookValueperShareTier1CapitalRatioTier1RiskBasedCapitalRatio 3,312,867$4.71 8.44%10.78% 3,312,867$4.68 8.50%10.92% 3,312,867$4.65 8.63%11.22% 3,312,867$4.62 8.63%10.80% Profitability YieldonAverageEarningAssetsCostofAvg.InterestBearingLiabilitiesNetSpreadNetMargin QuarterEnded9/30/2015 QuarterEnded6/30/2015 QuarterEnded3/31/2015 QuarterEnded12/31/2014 4.19%0.96%3.23%3.50% 4.21%0.95%3.26%3.53% 4.42%0.92%3.49%3.74% 4.40%0.94%3.47%3.70% Thisreleasemaycontaincertainforward-lookingstatementswithinthewithinthemeaningofthePrivateSecuritiesLitigationReformActof1995.Forthispurposeanystatementscontainedinthisreportthatarenotstatementsofhistoricalfactmaybedeemedtobeforward-lookingstatements.Withoutlimitingtheforegoing,wordssuchas“may”,“will”,“expect”,“believe”,“anticipate”,“estimate”or“continue”parableterminology,areintendedtoidentifyforward-lookingstatements.Thesestatementsbytheirnatureinvolvesubstantialrisksanduncertainties,andactualresultsmaydiffermateriallydependingonavarietyoffactors,manyofwhicharenotwithinEmpireStateBank’scontrol.Theforwardlookingstatementsincludedinthisreportaremadeonlyasofthedateofthisreport.Wehavenointention,anddonotassumeanyobligation,toupdatetheseforward-lookingstatements. Page9