2010 Press Release

Portage Bancshares Inc. Increases Dividends to Shareholders

Contact Info: Mr. Richard J. Coe
                        Portage Community Bank
                        Chief Executive Officer
                        (330) 296-8090
                        rcoe@pcbbank.com

Date:               May 18, 2010

RAVENNA, OHIO Richard J. Coe, Chief Executive Officer of Portage Community Bank and a Director of Portage Bancshares, Inc. announced the Company’s 2009 financial performance last night at the Annual Shareholders Meeting.  The meeting, held at the Rusty Nail Restaurant in Kent provided those in attendance with a delicious dinner before Mr. Coe made his presentation.

“In today’s troubled financial industry I am extremely proud of the Bank’s accomplishments in 2009 and that the continued Growth in all the key areas of the Bank’s Loans, Deposits, and Total Assets contributed to a very solid year,” began Mr. Coe.  He went on to highlight Portage Community Bank’s performance for 2009.  Total Deposits grew by double digits of 10.3% over the previous year.   “By increasing the deposit base through various promotions Portage Community Bank was able to fund loans and prove their continued commitment to reinvest within the community while meeting the deposit needs of our customers,” Mr. Coe commented.  Total Deposits as of December 31, 2009 amounted to $185.9 million as compared to $168.6 million in 2008, for an increase of $17.3 million.  Mr. Coe then stated, “We are so proud of the milestone reached in our Kent Office, opened July, 2006, that as of today Total Deposits in Kent have reached $38.8 million. This growth has surpassed the 5 year goal of $35 million dollars.” Total Assets again demonstrated solid growth of $21.1 million over the previous year which represented an increase of 10.2% based on growth from $207.0 million to $228.1 million as of December 31, 2009.  Portage Community Bank had the greatest percentage increase in deposit market share in Portage County increasing from 10.9% in June of 2008 to 11.8% in June 2009 according to F.D.I.C. Deposit Reports.   

Our Net Loan growth was purposely slowed based on the economy.  Net Loan growth for 2009 was $3.7 million dollars.

Portage Community Bank has also been defined as a Well Capitalized Bank based on the FDIC Act of 1991.  Its ratios of Total Risk Based Capital, Tier 1 Risk Based Capital and Leverage Capital exceed the minimum capital ratios to be considered a well capitalized bank.  In addition, Bauer Financial Inc. has awarded an Excellent Four Star Rating to Portage Community Bank and placed the Bank on their Recommended Bank Report.  This recommendation highlights Portage Community Bank’s third consecutive year as one of the strongest banks in the nation.  “This comes at a time when strength, stability, safety and security in a local bank mean a great deal more to our customers and shareholders” continued Mr. Coe.

Mr. Coe extended his thanks to the Board of Directors for their continued leadership and acknowledged the 55 employees of the Bank.  He said, “Their dedication and compassion to build a solid foundation of customer service has been unprecedented since the day our doors opened.”

At the end of the evenings presentation Mr. Coe stated, “We are very proud that our shareholders recognize we are truly “Neighbors Serving Neighbors” while at the same time increasing the return that they receive for their investment.”  He announced that the Board of Directors of Portage Bancshares Inc. unanimously voted to pay a dividend of $.60 a share, as of record on June 30, 2010.  This figure represents a 9% increase in the dividends from last year.  This dividend, paid on an annual basis, will be distributed in July, 2010.

Portage Community Bank is a wholly owned subsidiary of Portage Bancshares Inc.  To learn more about Portage Community Bank, please visit their website at www.pcbbank.com.  Portage Community Bank is an equal housing lender and FDIC Insured.