8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 22, 2010

PROVIDENT FINANCIAL SERVICES, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	001-31566	42-1547151
(State or Other Jurisdiction of Incorporation)	(Commission File No.)	(I.R.S. Employer Identification No.)

830 Bergen Avenue, Jersey City, New Jersey	07306-4599
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (201) 333-1000

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operation and Financial Condition.

On April 22, 2010, Provident Financial Services, Inc. (the “Company”) issued a press release reporting its financial results for the three months ended March 31, 2010. A copy of the press release is attached as Exhibit 99.1 to this report and is being furnished to the SEC and shall not be deemed “filed” for any purpose.

Item 7.01  Regulation FD Disclosure.

The Company announced that its Board of Directors declared a quarterly cash dividend of $0.11 per share, payable on May 28, 2010 to stockholders of record on May 14, 2010. This announcement was included as part of a press release announcing financial results for the quarter ended March 31, 2010 issued by the Company and attached as Exhibit 99.1 to this report and is being furnished to the SEC and shall not be deemed “filed” for any purpose.

The Company will make a presentation at its 2010 Annual Meeting of Stockholders to be held at the Sheraton Newark Airport Hotel, 128 Frontage Road, Newark, New Jersey on Thursday, April 22, 2010, at 10:00 a.m., local time. The presentation provides an overview of the Company’s business and strategic focus and the results of its operations for the quarter ended March 31, 2010. A copy of the presentation is attached as Exhibit 99.2 to this report and is being furnished to the SEC and shall not be deemed “filed” for any purpose.

Item 9.01. Financial Statements and Exhibits

(a) Financial Statements of Businesses Acquired. Not applicable.

(b) Pro Forma Financial Information. Not applicable.

(c) Shell Company Transactions. Not applicable.

(d) Exhibits.

Exhibit No.	Description
99.1	Press release issued by the Company on April 22, 2010 announcing its financial results for the three months ended March 31, 2010 and the declaration of a quarterly cash dividend.
99.2	Slide presentation to be made at the Company’s 2010 Annual Meeting of Stockholders to be held on April 22, 2010.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

	PROVIDENT FINANCIAL SERVICES, INC.
Date: April 22, 2010	By:	/s/    CHRISTOPHER MARTIN
		Christopher Martin,
		President and
		Chief Executive Officer

EXHIBIT INDEX

Exhibit	Description
99.1	Press release issued by the Company on April 22, 2010 announcing its financial results for the three months ended March 31, 2010 and the declaration of a quarterly cash dividend.
99.2	Slide presentation to be made at the Company’s 2010 Annual Meeting of Stockholders to be held on April 22, 2010.

EX-99.1

Exhibit 99.1

Provident Financial Services, Inc. Announces Quarterly Earnings and Declares

Quarterly Cash Dividend

JERSEY CITY, NJ, April 22, 2010 - Provident Financial Services, Inc. (NYSE:PFS) (the “Company”) reported net income of $11.2 million, or $0.20 per basic and diluted share for the three months ended March 31, 2010, compared with operating income, excluding a non-cash goodwill impairment charge, of $8.9 million, or $0.16 per basic and diluted share for the three months ended March 31, 2009. The Company recognized a $152.5 million, or $2.72 per share goodwill impairment charge during the prior year quarter ended March 31, 2009. This accounting charge resulted in a net loss of $143.6 million, or $2.56 per basic and diluted share for the prior year quarter ended March 31, 2009.

First quarter 2010 results benefitted from a steeper yield curve and lower funding costs, with net interest income increasing $6.8 million compared with the same period in 2009. This improvement was partially offset by a $3.2 million increase in the provision for loan losses for the three months ended March 31, 2010, compared with the same period in 2009, due to the following: a year-over-year increase in non-performing loans; downgrades in credit risk ratings; an increase in commercial loans as a percentage of the total loan portfolio; and the impact of current macroeconomic conditions.

Christopher Martin, President and Chief Executive Officer, commented, “We are pleased with our first quarter earnings and increased net interest income, yet we remain cautious in the near-term as prolonged unemployment continues to stress the local economy, as well as the performance of our conventional residential mortgage portfolio. We have begun to see some signs of an economic turnaround, however lower real estate values and consumer debt burdens have impacted loan demand and continue to constrain prudent loan portfolio growth.” Martin continued, “Much of the increase in our earnings can be directly attributed to our ongoing efforts to manage our funding costs and non-interest expenses, with the quarter reflecting improvements in both the net interest margin and the efficiency ratio. Capital ratios also strengthened during the quarter, and the Company and The Provident Bank remain well-capitalized under current bank regulations.”

Declaration of Quarterly Dividend

The Company’s Board of Directors declared a quarterly cash dividend of $0.11 per common share payable on May 28, 2010, to stockholders of record as of the close of business on May 14, 2010.

Balance Sheet Summary

Total assets decreased $39.6 million, or 0.6%, to $6.80 billion at March 31, 2010, from $6.84 billion at December 31, 2009, primarily as a result of decreases in securities available for sale, loans, and other assets, partially offset by an increase in cash and cash equivalents. Cash and cash equivalents increased $104.3 million to $228.1 million at March 31, 2010, from $123.7 million at December 31, 2009. These cash balances will be deployed to fund loan originations, investment purchases and the repayment of maturing borrowings.

Total investments decreased $74.4 million, or 4.4%, during the three months ended March 31, 2010. The decrease was primarily due to principal repayments on mortgage-backed securities, maturities and sales. The Company sold $18.1 million of Agency-guaranteed mortgage-backed securities as part of its interest rate risk management process during the first quarter of 2010, resulting in net gains of $817,000.

The Company’s net loans decreased $55.6 million, or 1.3%, to $4.27 billion at March 31, 2010, from $4.32 billion at December 31, 2009. Loan originations totaled $249.5 million and loan purchases totaled $23.3 million for the three months ended March 31, 2010. The loan portfolio had net increases of $44.9 million in commercial and multi-family mortgage loans, which were more than offset by decreases of $52.4 million in commercial loans, $25.0 million in residential mortgage loans, $15.6 million in construction loans, and $9.2 million in consumer loans. Commercial real estate, construction and commercial loans represented 52.7% of the loan portfolio at March 31, 2010, compared to 52.5% at December 31, 2009.

At March 31, 2010, the Company’s unfunded loan commitments totaled $703.1 million, including $361.6 million in commercial loan commitments, $63.2 million in construction loan commitments and $5.2 million in commercial mortgage commitments. Unfunded loan commitments at December 31, 2009 were $767.9 million.

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Other assets decreased $10.9 million, or 12.4%, to $76.7 million at March 31, 2010, from $87.6 million at December 31, 2009, primarily due to the settlement of equity fund redemptions that were pending as of December 31, 2009, and amortization of prepaid FDIC insurance.

Total deposits decreased $14.5 million, or 0.3%, during the three months ended March 31, 2010 to $4.88 billion. Core deposits, consisting of savings and demand deposit accounts, increased $61.6 million, or 1.8%, to $3.45 billion at March 31, 2010. The majority of the core deposit increase was in municipal and retail checking deposits. Time deposits decreased $76.0 million, or 5.0%, to $1.43 billion at March 31, 2010, with the majority of the decrease occurring in the 15-month and shorter maturity categories. The Company remains focused on cultivating core deposit relationships, while strategically permitting the run-off of certain higher-cost, single-service time deposits. Core deposits represented 70.7% of total deposits at March 31, 2010, compared to 69.2% at December 31, 2009.

Borrowed funds decreased $33.2 million, or 3.3% during the three months ended March 31, 2010, to $966.1 million. Borrowed funds represented 14.2% of total assets at March 31, 2010, a reduction from 14.6% at December 31, 2009.

Common stock repurchases for the three months ended March 31, 2010, totaled 16,000 shares at an average cost of $10.75 per share. At March 31, 2010, 2.1 million shares remained eligible for repurchase under the current authorization. At March 31, 2010, book value per share and tangible book value per share were $14.92 and $8.97, respectively, compared with $14.79 and $8.80, respectively, at December 31, 2009.

Results of Operations

Net Interest Margin

The Company’s net interest margin increased 19 basis points to 3.35% for the quarter ended March 31, 2010, from 3.16% for the quarter ended December 31, 2009. The increase in the net interest margin for the quarter ended March 31, 2010 versus the trailing quarter was primarily attributable to reductions in the average cost of interest-bearing liabilities. The average yield on interest-earning assets was 4.80% for the quarter ended March 31, 2010, compared with 4.79% for the quarter ended December 31, 2009. The average cost of interest-bearing liabilities was 1.64% for the quarter ended March 31, 2010, compared with 1.83% for the trailing quarter. The average cost of deposits for the quarter ended March 31, 2010 was 1.26%, compared with 1.47% for the trailing quarter. The average cost of borrowed funds for the quarter ended March 31, 2010 was 3.36%, compared with 3.43% for the quarter ended December 31, 2009.

The net interest margin for the quarter ended March 31, 2010 increased 25 basis points compared with the net interest margin of 3.10% for the quarter ended March 31, 2009. The increase in the net interest margin for the quarter ended March 31, 2010, compared with the same period last year was primarily attributable to reductions in the average cost of interest-bearing liabilities. The average yield on interest-earning assets declined 41 basis points to 4.80% for the quarter ended March 31, 2010, compared with 5.21% for the quarter ended March 31, 2009, however the average cost of interest-bearing liabilities declined 75 basis points to 1.64% for the quarter ended March 31, 2010, compared with 2.39% for the first quarter of 2009. The average cost of deposits for the quarter ended March 31, 2010 was 1.26%, compared with 2.06% for the same period last year. The average cost of borrowed funds for the quarter ended March 31, 2010 was 3.36%, compared with 3.47% for the same period last year.

Non-Interest Income

Non-interest income totaled $8.0 million for the quarter ended March 31, 2010, an increase of $1.0 million, or 15.0%, compared to the same period in 2009. Net gains on securities transactions increased $630,000 to $817,000 for the three months ended March 31, 2010, from $187,000 for the same period in 2009. Fee income increased $473,000 to $5.7 million for the three months ended March 31, 2010, from $5.2 million for the three months ended March 31, 2009, due primarily to increases in fees and commissions from the sale of non-deposit investment products and loan fees. Income from the appreciation of the cash surrender value of Bank-owned life insurance increased $229,000 to $1.4 million for the quarter ended March 31, 2010, compared with $1.2 million for the same period in 2009. Partially offsetting these increases, other income decreased $289,000 to $92,000 for the three months ended March 31, 2010, from $381,000 for the three months ended March 31, 2009, primarily due to a decrease in gains on loan sales resulting from reduced fixed-rate residential mortgage loan originations and conveyances.

Non-Interest Expense

Non-interest expense increased $1.5 million, or 4.4%, to $34.8 million, compared to $33.3 million (excluding the $152.5 million goodwill impairment charge) for the three months ended March 31, 2009. FDIC insurance expense increased $1.7 million, to $2.1 million for the three months ended March 31, 2010, from $426,000 for the same period in 2009, as a result of an increase in the assessment rate and deposit growth. In addition, other operating

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expenses increased $551,000, to $5.9 million for the quarter ended March 31, 2010, from $5.4 million for the same period in 2009, due primarily to a $423,000 increase in expenses related to foreclosed assets. Such expenses totaled $623,000 for the three months ended March 31, 2010, compared with $200,000 for the same period in 2009. Partially offsetting these increases in non-interest expense, the amortization of intangibles decreased $491,000 for the three months ended March 31, 2010, compared with the same period in 2009, due mainly to scheduled reductions in core deposit intangibles amortization. In addition, net occupancy expense decreased $252,000 for the three months ended March 31, 2010, compared with the same period in 2009.

Excluding the goodwill impairment charge in 2009, the Company’s annualized non-interest expense as a percentage of average assets was 2.07% for each of the quarters ended March 31, 2010 and 2009. Excluding the goodwill impairment charge in 2009, the efficiency ratio (non-interest expense divided by the sum of net interest income and non-interest income) was 59.14% for the quarter ended March 31, 2010, compared with 65.42% for the same period in 2009.

Asset Quality

The Company’s total non-performing loans at March 31, 2010 were $82.6 million, or 1.91% of total loans, compared with $84.5 million, or 1.93% of total loans at December 31, 2009, and $63.8 million, or 1.46% of total loans at March 31, 2009. At March 31, 2010, impaired loans totaled $35.5 million with related specific reserves of $5.9 million, compared with impaired loans totaling $41.1 million with related specific reserves of $12.5 million at December 31, 2009. The decrease in non-performing loans at March 31, 2010, compared with the trailing quarter, was largely due to a $5.0 million reduction in non-performing commercial mortgage loans primarily attributable to a $5.2 million charge-off of a collateral dependent impaired loan that was fully covered by a specific valuation allowance at December 31, 2009. In addition, non-performing consumer, commercial, and construction loans decreased $489,000, $397,000 and $151,000, respectively. These decreases were partially offset by a $4.1 million increase in non-performing residential mortgage loans, as borrowers continued to be adversely affected by an extended period of high levels of unemployment.

At March 31, 2010, the Company’s allowance for loan losses was 1.36% of total loans, compared with 1.39% of total loans at December 31, 2009, and 1.20% of total loans at March 31, 2009. The Company recorded a provision for loan losses of $9.0 million for the quarter ended March 31, 2010, compared with a provision of $5.8 million for the quarter ended March 31, 2009. For the three-month period ended March 31, 2010, the Company had net charge-offs of $10.8 million, compared with net charge-offs of $1.2 million for the same period in 2009. Net charge-offs of $9.5 million were recognized during the quarter ended March 31, 2010, on three loan relationships which had previously been reported as impaired and for which $7.4 million of specific reserves had been previously allocated. The provision for loan losses for the first quarter of 2010 was $1.8 million less than net charge-offs as a result of the decline in the total loan portfolio and charge-offs of previously allocated specific reserves on impaired loans. The increase in the loan loss provision for the three months ended March 31, 2010, compared with the same period in 2009, was attributable to a year-over-year increase in non-performing loans; downgrades in credit risk ratings; an increase in commercial loans, including commercial mortgage and construction loans, as a percentage of the total loan portfolio to 52.7% at March 31, 2010, from 48.1% at March 31, 2009; and the impact of current macroeconomic conditions. At March 31, 2010, the Company held $5.0 million of foreclosed assets, compared with $6.4 million at December 31, 2009.

Income Tax Expense

For the three months ended March 31, 2010, the Company’s income tax expense was $3.8 million. This compared with $2.9 million for the same period in 2009. The increase in income tax expense was attributable to greater pre-tax income, partially offset by a lower effective tax rate. The Company’s effective tax rate was 25.5% for the three months ended March 31, 2010, compared with 27.4% (excluding the impact of the goodwill impairment charge, which was not tax-deductible) for the three months ended March 31, 2009. The reduction in the Company’s effective tax rate was primarily the result of a larger proportion of the Company’s income being derived from tax-exempt sources.

About the Company

Provident Financial Services, Inc. is the holding company for The Provident Bank, a community-oriented bank offering a full range of retail and commercial loan and deposit products. At March 31, 2010, the Bank operated 82 full service branches throughout northern and central New Jersey.

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Post Earnings Conference Call

Representatives of the Company will hold a conference call for investors at 10:00 a.m. Eastern Time on April 23, 2010 regarding highlights of the Company’s first quarter 2010 financial results. The call may be accessed by dialing 1-800-860-2442 (Domestic) or 1-412-858-4600 (International). Internet access to the call is also available (listen only) at www.providentnj.com by going to Investor Relations and clicking on Webcast.

Forward Looking Statements

Certain statements contained herein are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as “may,” “will,” “believe,” “expect,” “estimate,” “anticipate,” “continue,” or similar terms or variations on those terms, or the negative of those terms. Forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, those related to the economic environment, particularly in the market areas in which the Company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset-liability management, the financial and securities markets and the availability of and costs associated with sources of liquidity.

The Company cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company also advises readers that the factors listed above could affect the Company’s financial performance and could cause the Company’s actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. The Company does not undertake and specifically declines any obligation to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

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PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY

Consolidated Statements of Condition

March 31, 2010 (Unaudited) and December 31, 2009

(Dollars in thousands, except share data)

	March 31, 2010			December 31, 2009
Assets
Cash and due from banks	$	225,832		$	120,823
Short-term investments		2,251			2,920
Total cash and cash equivalents		228,083			123,743
Investment securities held to maturity (fair value of $343,802 at March 31, 2010 (unaudited) and $344,385 at December 31, 2009)		334,564			335,074
Securities available for sale, at fair value		1,260,147			1,333,163
Federal Home Loan Bank stock, at cost		33,356			34,276
Loans		4,326,813			4,384,194
Less allowance for loan losses		58,969			60,744
Net loans		4,267,844			4,323,450
Foreclosed assets, net		5,043			6,384
Banking premises and equipment, net		75,292			76,280
Accrued interest receivable		24,775			25,797
Intangible assets		356,971			358,058
Bank-owned life insurance		133,744			132,346
Other assets		76,720			87,601
Total assets	$	6,796,539		$	6,836,172
Liabilities and Stockholders’ Equity
Deposits:
Demand deposits	$	2,563,944		$	2,522,732
Savings deposits		889,188			868,835
Certificates of deposit of $100,000 or more		441,270			469,313
Other time deposits		990,313			1,038,297
Total deposits		4,884,715			4,899,177
Mortgage escrow deposits		20,097			18,713
Borrowed funds		966,064			999,233
Other liabilities		31,452			34,494
Total liabilities		5,902,328			5,951,617
Stockholders’ Equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized, none issued		—			—
Common stock, $0.01 par value, 200,000,000 shares authorized, 83,209,293 shares issued and 59,919,246 shares outstanding at March 31, 2010, and 59,821,850 shares outstanding at December 31, 2009		832			832
Additional paid-in capital		1,015,396			1,014,856
Retained earnings		312,300			307,751
Accumulated other comprehensive income		11,782			7,731
Treasury stock at cost		(385,149	)		(384,973	)
Unallocated common stock held by Employee Stock Ownership Plan		(60,950	)		(61,642	)
Common Stock acquired by the Directors’ Deferred Fee Plan		(7,551	)		(7,575	)
Deferred compensation – Directors’ Deferred Fee Plan		7,551			7,575
Total stockholders’ equity		894,211			884,555
Total liabilities and stockholders’ equity	$	6,796,539		$	6,836,172

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PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY

Consolidated Statements of Operations

Three Months Ended March 31, 2010 and 2009

(Dollars in thousands, except per share data)

	Three Months Ended March 31
	2010		2009
	(Unaudited)
Interest income:
Real estate secured loans	$	39,714	$	40,605
Commercial loans		10,337		10,498
Consumer loans		7,276		8,174
Investment securities		3,249		3,449
Securities available for sale		11,761		10,711
Deposits, Federal funds sold and other short-term investments		70		20
Total interest income		72,407		73,457
Interest expense:
Deposits		13,506		19,570
Borrowed funds		8,133		9,956
Total interest expense		21,639		29,526
Net interest income		50,768		43,931
Provision for loan losses		9,000		5,800
Net interest income after provision for loan losses		41,768		38,131
Non-interest income:
Fees		5,702		5,229
Bank-owned life insurance		1,398		1,169
Net gain on securities transactions		817		187
Other income		92		381
Total non-interest income		8,009		6,966
Non-interest expense:
Goodwill impairment		—		152,502
Compensation and employee benefits		17,539		17,477
Net occupancy expense		5,140		5,392
Data processing expense		2,284		2,356
FDIC insurance		2,099		426
Amortization of intangibles		1,103		1,594
Advertising and promotion expense		670		674
Other operating expenses		5,927		5,376
Total non-interest expense		34,762		185,797
Income (loss) before income tax expense		15,015		(140,700	)
Income tax expense		3,828		2,919
Net income (loss)	$	11,187	$	(143,619	)
Basic earnings (loss) per share	$	0.20	$	(2.56	)
Average basic shares outstanding		56,457,544		56,169,573
Diluted earnings (loss) per share	$	0.20	$	(2.56	)
Average diluted shares outstanding		56,457,544		56,169,573

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PROVIDENT FINANCIAL SERVICES, INC.

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Dollars in thousands, except share data) (Unaudited)

	At or for the Three Months Ended March 31,
	2010			2009
STATEMENTS OF OPERATIONS:
Net interest income	$	50,768		$	43,931
Provision for loan losses		9,000			5,800
Non-interest income		8,009			6,966
Non-interest expense (1)		34,762			33,295
Operating income before income tax expense (2)		15,015			11,802
Operating income (2)		11,187			8,883
Goodwill impairment charge		—			152,502
Net income (loss)	$	11,187			(143,619	)
Operating basic and diluted earnings per share (1)	$	0.20		$	0.16
Per share impact of goodwill impairment charge		—		$	(2.72	)
Basic and diluted earnings (loss) per share	$	0.20		$	(2.56	)
Interest rate spread		3.16	%		2.82	%
Net interest margin		3.35	%		3.10	%
PROFITABILITY:
Annualized return on average assets (1)		0.67	%		0.55	%
Annualized return on average equity (1)		5.08	%		3.53	%
Annualized non-interest expense to average assets (1)		2.07	%		2.07	%
Efficiency ratio (1), (3)		59.14	%		65.42	%
ASSET QUALITY:
Non-accrual loans	$	82,555		$	63,753
Non-performing loans		82,555			63,753
Foreclosed assets		5,043			4,758
Non-performing loans to total loans		1.91	%		1.46	%
Non-performing assets to total assets		1.29	%		1.05	%
Allowance for loan losses	$	58,969		$	52,350
Allowance for loan losses to non-performing loans		71.43	%		82.11	%
Allowance for loan losses to total loans		1.36	%		1.20	%
AVERAGE BALANCE SHEET DATA:
Assets	$	6,794,656		$	6,537,760
Loans, net		4,286,089			4,362,467
Interest-Earning assets		6,079,426			5,678,197
Core deposits		3,410,681			2,714,808
Borrowed funds		982,012			1,163,140
Interest-bearing liabilities		5,346,271			5,013,652
Stockholders’ equity		893,873			1,019,231
Average yield on interest-earning assets		4.80	%		5.21	%
Average cost of interest- bearing liabilities		1.64	%		2.39	%

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Notes

(1) Excluding a $152.5 million non-cash goodwill impairment charge in 2009

(2) Operating Income Reconciliation

	Three Months Ended March 31,
	2010			2009
Net income (loss)	$	11,187		$	(143,619	)
Goodwill impairment		—			152,502
Operating income		11,187			8,883
(3) Efficiency Ratio Calculation
	Three Months Ended March 31,
	2010			2009
Net interest income	$	50,768		$	43,931
Non-interest income		8,009			6,966
Total income	$	58,777		$	50,897
Non-interest expense (1)	$	34,762		$	33,295
Expense/Income (1)		59.14	%		65.42	%

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Average Quarterly Balance

NET INTEREST MARGIN ANALYSIS

(Unaudited) (Dollars in thousands)

	March 31, 2010							December 31, 2009
	Average Balance			Interest		Average Yield/Cost		Average Balance			Interest		Average Yield/Cost
Interest-Earning Assets:
Deposits	$	112,734		$	70	0.25	%	$	140,996		$	89	0.25	%
Federal Funds Sold and Short-Term Investments		2,710			—	0.01			3,630			—	0.01
Investment Securities (1)		333,894			3,249	3.89			336,549			3,300	3.92
Securities Available for Sale		1,309,491			11,272	3.44			1,331,061			11,817	3.55
Federal Home Loan Bank Stock		34,508			489	5.75			34,645			493	5.64
Net Loans (2)
Total Mortgage Loans		2,975,211			39,714	5.37			2,955,138			39,528	5.33
Total Commercial Loans		731,923			10,337	5.73			742,443			10,881	5.81
Total Consumer Loans		578,955			7,276	5.10			590,859			7,643	5.13
Total Interest-Earning Assets		6,079,426			72,407	4.80			6,135,321			73,751	4.79
Non-Interest Earning Assets:
Cash and Due from Banks		52,839							106,075
Other Assets		662,391							629,667
Total Assets	$	6,794,656						$	6,871,063
Interest-Bearing Liabilities:
Demand Deposits	$	2,029,446			4,898	0.98	%	$	2,000,062			5,698	1.13	%
Savings Deposits		872,016			1,109	0.52			870,041			1,165	0.53
Time Deposits		1,462,797			7,499	2.08			1,561,760			9,556	2.43
Total Deposits		4,364,259			13,506	1.26			4,431,863			16,419	1.47
Borrowed Funds		982,012			8,133	3.36			1,008,844			8,721	3.43
Total Interest-Bearing Liabilities		5,346,271			21,639	1.64			5,440,707			25,140	1.83
Non-Interest Bearing Liabilities		554,512							543,257
Total Liabilities		5,900,783							5,983,964
Stockholders’ Equity		893,873							887,099
Total Liabilities & Stockholders’ Equity	$	6,794,656						$	6,871,063
Net interest income				$	50,768						$	48,611
Net interest rate spread						3.16	%						2.96	%
Net interest-earning assets	$	733,155						$	694,614
Net interest margin (3)						3.35	%						3.16	%
Ratio of interest-earning assets to interest-bearing liabilities		1.14	x						1.13	x

(1) Average outstanding balance amounts shown are amortized cost.

(2) Average outstanding balances are net of the allowance for loan losses, deferred loan fees and expenses, loan premiums and discounts and include non-accrual loans.

(3) Annualized net interest income divided by average interest-earning assets.

9

The following table summarizes the net interest margin for the previous five quarters.

	3/31/10 1st Qtr.		12/31/09 4th Qtr.		9/30/09 3rd  Qtr.		6/30/09 2nd  Qtr.		3/31/09 1st Qtr.
Interest-Earning Assets:
Securities	3.37	%	3.40	%	3.47	%	3.64	%	4.31	%
Net Loans	5.40	%	5.39	%	5.40	%	5.44	%	5.48	%
Total Interest-Earning Assets	4.80	%	4.79	%	4.84	%	4.96	%	5.21	%
Interest-Bearing Liabilities
Total Deposits	1.26	%	1.47	%	1.73	%	1.93	%	2.06	%
Borrowed Funds	3.36	%	3.43	%	3.50	%	3.60	%	3.47	%
Total Interest-Bearing Liabilities	1.64	%	1.83	%	2.07	%	2.27	%	2.39	%
Interest Rate Spread	3.16	%	2.96	%	2.77	%	2.69	%	2.82	%
Net Interest Margin	3.35	%	3.16	%	3.01	%	2.96	%	3.10	%
Ratio of Interest-Earning Assets to Interest-Bearing Liabilities	1.1	4x	1.1	3x	1.1	3x	1.1	3x	1.1	3x

10

EX-99.2

1

Exhibit 99.2

Certain statements contained herein are "forward-looking statements" within the meaning of

Section

27A

of

the

Securities

Act

of

1933

and

Section

21E

of

the

Securities

Exchange

Act

of

1934. Such forward-looking statements may be identified by reference to a future period or

periods, or by the use of forward-looking terminology, such as "may," "will," "believe,"

"expect,"

"estimate,"

"anticipate,"

"continue,"

or

similar

terms

or

variations

on

those

terms,

or

the negative of those terms. Forward-looking statements are subject to numerous risks and

uncertainties, including, but not limited to, those related to the economic environment,

particularly in the market areas in which Provident Financial Services, Inc. (the “Company”)

operates, competitive products and pricing, fiscal and monetary policies of the U.S.

Government, changes in government regulations affecting financial institutions, including

regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions

and the integration of acquired businesses, credit risk management, asset-liability

management, the financial and securities markets and the availability of and costs

associated with sources of liquidity.

The Company cautions readers not to place undue reliance on any such forward-looking

statements, which speak only as of the date made. The Company also advises readers that

the factors listed above could affect the Company's financial performance and could cause

the Company's actual results for future periods to differ materially from any opinions or

statements expressed with respect to future periods in any current statements. The

Company does not undertake and specifically declines any obligation to publicly release the

result of any revisions which may be made to any forward-looking statements to reflect

events or circumstances after the date of such statements or to reflect the occurrence of

anticipated or unanticipated events.

2

3

*As of 4/16/10

4

FINANCIAL SERVICES EXPERIENCE:

5

6

FINANCIAL SERVICES EXPERIENCE:

•

All directors independent except CEO

•

Broad diversification and backgrounds

•

Average term on Board exceeds 14 years

•

Strong financial expertise

7

•

Provide

solutions

for

our

customers’

financial

needs

through

personal interaction accompanied by competitive and

diverse product offerings

•

Continue to diversify our balance sheet composition with

emphasis on commercial relationships

•

Conservatively manage our company for consistent long-

term profitability and growth

•

Logically expand and grow in markets relevant to our

company

•

Expand/maintain margin without taking a substantial

amount of interest rate risk

•

Build upon our low-cost, core deposit funding base

8

•

Build and grow fee income sources (Wealth Management)

•

Constantly challenge our officers and staff to achieve

operating efficiencies

•

Continue

to

cultivate

a

“Pay

for

Performance”

culture

within

our organization

•

Maintain sufficient capital to provide adequate coverage to

operate effectively

•

Monitor the M & A environment for accretive opportunities

9

Adhering to priorities culminates in

•

Competitive advantage

•

Profitable growth

•

Increased earnings

•

Enhanced long-term stockholder value

10

11

(In millions)

12

As of December 31,

13

As of December 31,

14

Weighted Avg. Life: 2.93 yrs.

Weighted Avg. Life: 4.02 yrs.

* Non-Interest Bearing

16

17

As of December 31,

(In thousands)

18

19

(Dollars in thousands)

INCOME STATEMENT:

3/31/10

3/31/09*

Net income

$11,187

$8,883

Diluted earnings per share

$0.20

$0.16

Return on equity

5.08%

3.53%

Return on assets

0.67%

0.55%

Net interest margin

3.35%

3.10%

Efficiency ratio

59.14%

65.42%

20

*All dollar amounts and percentages exclude the effects of the $152.5 million goodwill impairment

charge recorded in the first quarter of 2009.

(Dollars in thousands)

BALANCE SHEET:

3/31/10

12/31/09

Total assets

$6,796,539

$6,836,172

Total loans

$4,326,813

$4,384,194

Total deposits

$4,884,715

$4,899,177

Total investments

$1,628,067

$1,702,513

Total borrowed funds

$966,064

$999,233

Total stockholders' equity

$894,211

$884,555

21

22

23

24

Amount

Ratio

Amount

Ratio

Regulatory Tier 1 leverage capital

257,529

$  

4.00%

431,904

$   

6.71%

Tier 1 risk-based capital

168,468

$  

4.00%

431,904

$   

10.25%

Total risk-based capital

336,937

$  

8.00%

484,628

$   

11.51%

REQUIRED

ACTUAL

(Dollars in thousands)

The Provident Bank continues to exceed all current regulatory

The Provident Bank continues to exceed all current regulatory

capital requirements and remains “well capitalized.”

capital requirements and remains “well capitalized.”

25

26

Current Dividend Yield (as of 4/16/09) = 3.53%

27