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SECURITY INVESTMENTS GROUP ANNOUNCES PROPOSED BRANCH SALE AND RECAPITALIZATION

 SECURITY INVESTMENTS GROUP ANNOUNCES
 PROPOSED BRANCH SALE AND RECAPITALIZATION
 VINELAND, N.J., July 9 /PRNewswire/ -- Security Investments Group, Inc. (NASDAQ: SSLN), the parent company for Security Savings Bank, SLA, (Security) announced today the signing of a definitive agreement providing for the sale of 21 of its branch offices in southern New Jersey, to Meridian Bancorp, Inc., (NASDAQ: MRDN) a commercial bank holding company headquartered in Reading, Pa., (Meridian).
 Under the agreement, Meridian will assume at book value all of Security's deposit liabilities at these branches, and certain other deposits, which approximate $550 million, as well as approximately $271 million of Security's
FHLB advances. The deposit transfer will be funded by Security primarily through a transfer at book value of certain of its performing loans, mortgage-backed securities and certain other assets. Meridian will pay Security a deposit premium of 2.36 percent of deposits assumed or approximately $13.2 million.
 Following consummation of the transaction Security will continue to operate as a New Jersey chartered financial institution headquartered in Vineland, with eight offices in southern New Jersey. Based upon the sale to Meridian, Security will be a much smaller company with assets of approximately $350 million. It is also expected that its tangible capital will increase to approximately $24 million. Security's non performing asset portfolio of approximately $84 million will be retained by Security, as well as all $22 million of general and specific valuation allowances.
 In a separate matter, the company stated that the losses experienced in the first quarter are forecasted to continue through the second quarter as Security continues to write down its excess servicing asset as the mortgage refinance activity continues at an accelerated pace due to historically low interest rates in the mortgage market. Security sees these write downs being partially offset by positive operating results in the thrift. The loss for the second quarter is forecasted to be approximately $1 million.
 P. Paul Ricci, chairman of the board, said, "The branch sale transaction is the culmination of efforts by the board of directors to restructure security and increase its tangible capital following the adverse impact of recent Federal legislation on Security's operations and capital and previously announced losses. The recent legislation eliminated the supervisory goodwill which Security had included as capital pursuant to contract with the Federal government. Security has commenced a lawsuit to enforce its contractual rights. Completion of the branch sale transaction, which will include the simultaneous write- off of existing goodwill of approximately $53 million associated with the branches to be sold, is intended to significantly increase Security's tangible capital. The future success of Security following such completion will also be dependent upon Security's successful resolution of its non performing assets.
 Ricci concluded, "While we would have preferred that this downsizing of Security and the resulting consolidation of management and staff not occur, the need for additional capital necessitated by the adverse Federal legislation and the recent losses due in large part to the downturn in the local economy have required us to make this change in operational strategy. We will, however, continue to service our consumers and businesses in our home market and provide the full array of financial products and services which they have come to expect from Security."
 The branch sale transaction is subject to receipt by both Security and Meridian of all required regulatory approvals, including the OTS, and receipt by the company of approval by its stockholders. The transaction is also subject to numerous standard and certain other conditions. In addition, Meridian must complete and be satisfied with its final due diligence of Security within 60 days of the date of the definitive agreement.
 Security must also obtain OTS approval of a capital plan which reflects the branch sale and comply with any conditions contained therein. Management of Security and Meridian will continue to work together to effect an orderly transfer of branches and to assure uninterrupted banking operations for those customers affected by the transfer.
 Security Savings Bank, SLA, a subsidiary of Security Investments Group, Inc., is a state chartered financial institution headquartered in Vineland. The deposit accounts of Security are insured by the Federal Deposit Insurance Corporation (FDIC). Security operates 29 branches throughout southern New Jersey and provides businesses and consumers with a wide variety of financial products and services.
 /delval/
 -0- 7/9/92
 /CONTACT: Ronald A.. Seagraves, president and CEO of Security Investments Group, 609-691-2400/
 (SSLN MRDN) CO: Security Investments Group, Inc.; Meridian Bancorp, Inc. ST: New Jersey, Pennsylvania IN: FIN SU: RCN


MP-MS -- PH002 -- 7697 07/09/92 08:25 EDT
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Publication:PR Newswire
Date:Jul 9, 1992
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