Center Bancorp, Inc. Reports Increased Second Quarter Earnings Results.

Business Editors

UNION, N.J.--(BUSINESS WIRE)--July 26, 2000

Center Bancorp, Inc. (Nasdaq, NM:CNBC), holding company for Union Center National Bank, today reported a 5.2% increase in operating results for the second quarter of 2000.

Net income for the three months ended June 30, 2000 increased $61,000 or 5.2% to $1,231,000 or .32 cents per share, diluted, compared to the $1,170,000 or .31 cents per share, diluted, earned for the second quarter of 1999. For the first six months of 2000, net income rose $126,000 or 5.5% to $2,427,000 or .63 cents per diluted share compared to $2,301,000 or .61 cents per diluted share, earned for the first six months of 1999.

The Corporation's earnings results year-to-date, as well as for the second quarter of 2000 continue to reflect growth in revenue generated by core earnings performance. For the six months ended June 30, 2000, total interest income increased approximately $1.7 million or 9.75%, over the same period in 1999. Total income for the second quarter of 2000 increased $938,000 or 11.8%, over the comparable 1999 period. John J. Davis, President and CEO stated, "The continued favorable changes in both the growth in earning assets and change in the earning-asset mix assisted to improve earnings performance."

The loan portfoliio increased on average $22.8 million, an increase of 14.6% from June 30, 1999. Loan demand continues to increase, fueled by the increased branch network expansion, higher visibility in new markets, and a continued enhancement of product lines to meet market demands. While asset quality continues to remain high, during the second quarter, additional provisions of approximately $100,000 were made to the provision for loan and lease losses, to maintain adequate loan loss reserves in relationship with increased loan portfolio growth.

Rising interest rates, as the Federal Reserve raised interest rates for the third time in 2000, contributed to a compression of the Corporation's net interest margin for both the three and six month periods. For the second quarter the net interest margin declined to 4.05% from 4.22% as compared to the second quarter of 1999. Year-to-date net interest margins contracted 13 bases points to 4.08%, as compared with 1999.

During the second quarter Union Center National Bank introduced "Super Max", a premium rate savings investment account that generated approximately $27.9 million in new money. This resulted in total deposits increasing approximately 8.61% to $426.9 million at June 30, 2000 from $393.0 million at the same date in 1999. Securities sold under agreements to repurchase and Federal Home Loan Bank advances amounted to $65.7 million at June 30, 2000 compared to $63.9 million at June 30, 1999. Loans rose 16.8%, to $188.1 million from $161.0 million at the same date last year. Investment securities increased by 2.1% to $312.6 million at June 30, 2000 from $306.2 million at June 30, 1999.

Other noninterest income, net of gains on securities sold and extraordinary activity, during the second quarter increased $129,000 or 43.2% as compared to 1999. For the first six months of 2000 other income and fees climbed 43.2% or $223,000. The increases in both periods were driven by increased business activity, debit card income and ATM customer fees. Additionally recorded in other income results for the second quarter was an extraordinary gain of $102,000 from the sale of previously closed branch facility.

Total assets at June 30, 2000 were $534.1 million, an increase of 7.6% from assets of $496.6 million at June 30, 1999. Annualized return on average assets for the second quarter and six months ended June 30, 2000 was 0.93% compared to 0.94% for the 1999 periods. Total stockholders' equity at June 30, 2000 was $38.0 million, an increase of 3.56% from $36.8 million at June 30, 1999. Annualized return on average stockholders' equity was 13.02% for the 2000 six-month period and 12.37% for the comparable prior year period.

On July 24, 2000, Center Bancorp, Inc. purchased an aggregate of 117,246 shares of its Common Stock, in a negotiated private transaction, at a total purchase price of $2,931,150. After giving effect to this purchase, the total number of shares of Center Bancorp, Inc.'s Common Stock outstanding is 3,710,511.

Center Bancorp, Inc. through its wholly owned subsidiary Union Center National Bank, operates thirteen banking locations in Union, Millburn/Vauxhall, Springfield, Berkeley Heights, Cranford, Madison, Morristown and Summit, New Jersey.

This release contains certain forward-looking statements, either expressed or implied, which concern anticipated future financial performance. These statements involve certain risks, uncertainties, estimates and assumptions made by management, which are subject to factors beyond the Corporation's control, such as the interest rate environment, the overall economy and technological changes. Accordingly, actual results may differ materially from those expressed or implied by these forward-looking statements.

                         CENTER BANCORP, INC.
                   FINANCIAL HIGHLIGHTS (UNAUDITED)

              For the Three Months Ended      For the Six Months Ended
              --------------------------      ------------------------
                6/30/00        6/30/99          6/30/00      6/30/99

Net Income    $1,231,000     $1,170,000       $2,427,000   $2,301,000

Earnings per
    Share (a)

  Basic          $.32           $.31             $.64         $.61
  Diluted        $.32           $.31             $.63         $.61

Weighted
 Average Shares
 Outstanding

  Basic       3,824,126     3,774,570        3,812,162    3,767,709
  Diluted     3,846,603     3,798,112        3,833,486    3,792,705