Flushing Financial Corporation adopts stockholder rights plan.

FLUSHING, N.Y.--(BUSINESS WIRE)--Sept. 18, 1996--Flushing Financial Corporation (Nasdaq:FFIC) ("Flushing Financial") today announced that the Board of Directors has adopted a Stockholder Rights Plan designed to preserve long-term values and protect stockholders against stock accumulations and other abusive tactics to acquire control of the Company. Details of the Stockholder Rights Plan are outlined in a letter which is being mailed to all stockholders.

A Company spokesperson stated that the Rights Plan has not been adopted in response to any major purchase of its stock and the Company is not aware of any such major purchases; rather the Company has adopted the Rights Plan at this time in order to safeguard the interests of its stockholders.

Under the plan, each stockholder of record at the close of business on September 30, 1996 will receive a dividend distribution of one right for each share of common stock held. The rights expire on September 30, 2006.

Each right entitles stockholders to purchase from Flushing Financial one one-hundredth (1/100) of a share of junior participating preferred stock at an exercise price of $64.00. The rights will become exercisable only if a person or group acquires 15% or more of Flushing Financial's common stock or commences a tender or exchange offer which, if consummated, would result in the person or group owning at least 15% of the common stock. Prior to that time, the rights will not trade separately from the common stock.

If a person or group acquires 15% or more of Flushing Financial's common stock, each right will then entitle all other stockholders to purchase, by payment of the exercise price, Flushing Financial's common stock (or a common stock equivalent) with a value of twice the exercise price. In addition, at any time after such 15% or more acquisition and prior to the acquisition by any person or group of 50% or more of the outstanding common stock, the Board of Directors may, at its option, require each outstanding right (other than rights held by the acquiring person or group) to be exchanged for one share of common stock (or one common stock equivalent).

If, following an acquisition of 15% or more of the common stock, Flushing Financial is acquired by any person in a merger or other business combination transaction or sells more that 50% of its assets or earning power to any person, each right will entitle all other holders to purchase, by payment of the $64.00 exercise price, common stock of the acquiring company with a value of twice the exercise price.

Flushing Financial may redeem the rights at $.01 per right at any time prior to the time that any person or group has acquired 15% or more of its common stock.

James F. McConnell, Flushing Financial's President and Chief Executive Officer stated: "The rights are intended to enable all Flushing Financial stockholders to realize the long-term value of their investment in the Company. They do not prevent, nor are they intended to prevent, a takeover of Flushing Financial. However, these rights should encourage anyone seeking to acquire the Company to negotiate with the Board prior to attempting a takeover."

Flushing Savings Bank, FSB, is a federally chartered stock savings bank, insured by the FDIC through the Bank Insurance Fund. The Bank conducts its business through seven banking offices in Queens, Brooklyn, Manhattan and Nassau County. Flushing Financial Corporation acquired Flushing Savings Bank in connection with the Bank's conversion from mutual to stock form on November 21, 1995.

CONTACT: Michael J. Hegarty

Executive Vice President

Flushing Financial Corporation

[phone]

or

John P. Kehoe / Van Negris

Kehoe, White, Savage & Co., Inc.

[phone]