Patriot Expects Record Earnings for 3rd Quarter 2001.

Business Editors

POTTSTOWN, Pa.--(BUSINESS WIRE)--Oct. 4, 2001

Patriot Bank Corp. (NASDAQ - NMS - PBIX), parent company of Patriot Bank, in preparation of a Berks Business telecast via Berks Community Television on Monday, October 8, 2001 at 7:30 p.m., said that it expects record

Patriot expects that net income will be approximately $1.6 million or $.26 per diluted share for the third quarter, and $4.4 million or $.75 per diluted share for the nine months ended September 30, 2001. Cash earnings per share are expected to be $1.9 million or $.33 per diluted share and approximately $5.7 million or $.96 per diluted share for the nine months ended September 30, 2001.

"These results are the product of continued loan growth, good asset quality, growth in core deposits, margin expansion, strong fee income and lower overhead expenses," said Richard A. Elko, President & C.E.O.

Earlier this year Patriot announced its two-year target plan that will complete its transition from a thrift to a commercial bank. As of September 30, 2001, Patriot is either on target or ahead of schedule in the various aspects of the plan.

"We have worked very diligently throughout 2001 toward our two-year target plan and we are very pleased that we have been able to deliver on all counts of the plan," continued Elko.

Some preliminary highlights of the quarter include:

-- Patriot's interest margin has improved to 2.61% for the third quarter 2001, compared to 2.12% for the third quarter of 2000.

-- Branch deposits grew to $477 million at September 30, 2001, including an annualized growth rate of 24% in core deposits during 2001.

-- Average cost of branch deposits at September 30, 2001 decreased to 3.85%, compared to 4.75% at December 31, 2000.

-- The commercial loan portfolio (commercial loans and commercial leases) grew to $349 million or a 12% annualized growth rate during 2001.

-- Successful implementation of the variablized cost structure in the mortgage banking unit decreased operating costs by over 50% compared to 2000. The mortgage banking operation contributed approximately 10% of the company's pre-tax earnings.

-- Wholesale funding has been reduced by $135 million through September 30, 2001, with a corresponding reduction of investments and mortgage loans.

Additionally, Patriot announced earlier this year that the anticipated effect of the Financial Accounting Standards Board's exposure draft on business combinations is likely to have a very positive effect on Patriot's earnings as a result of the elimination of annual goodwill amortization expense of approximately $800,000 after-tax, when this statement is adopted in January 2002.

Patriot is also on target to relocate its Wyomissing, Pennsylvania, office (currently located inside a supermarket) to a free standing office across the street at 2228 State Hill Road. The new office will include full banking services, including two drive-through lanes and a drive-through ATM.

Patriot is a $1 billion financial services company operating 19 banking and lending offices in southeastern Pennsylvania. The closing price of Patriot Bank Corp.'s common stock was $10.20 on October 3, 2001.

In addition to historical information, this information may contain "forward-looking statements" which are made in good faith by Patriot Bank Corp. ("Patriot"), pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements include statements with respect to Patriot's strategies, goals, beliefs, expectations, estimates, intentions, financial condition, results of operations, future performance and business of Patriot.

Statements preceded by, followed by or that include the words "may," "could," "should," "pro forma," "looking forward," "would," "believe," " expect," "anticipate," "estimate," " intend," "plan," or similar expressions generally indicate a forward-looking statement. These forward-looking statements involve risks and uncertainties that are subject to change based on various important factors (some of which, in whole or in part, are beyond Patriot's control).

Numerous competitive, economic, regulatory, legal and technological factors, among others, could cause Patriot's financial performance to differ materially from the goals, plans, objectives, intentions and expectations expressed in such forward-looking statements.

Patriot cautions that the foregoing factors are not exclusive, and neither such factors nor any such forward-looking statement takes into account the impact that any future acquisition may have on Patriot and any such forward-looking statement. Patriot does not undertake to update any forward-looking statement whether written or oral, that may be made from time to time by or on behalf of Patriot.