Prepared and filed by St Ives Burrups

FOR IMMEDIATE RELEASE
CONTACT:

Marc Sanders, Director of Marketing
610-668-4700 x277
marcsanders@royalbankamerica.com

                         ROYAL BANK AMERICA’S PARENT COMPANY REPORTS:
                         •      7^th CONSECUTIVE YEAR OF RECORD EARNINGS
                         •      EARNINGS FOR THE YEAR ECLIPSED $20 MILLION
                         •      TOTAL ASSETS TOPPED $1.2 BILLION

(Narberth, PA) – January 20, 2005 – Royal Bank America reports that consolidated earnings for its holding company, Royal Bancshares of Pennsylvania, Inc., (NASDAQ-RBPAA) for the three-month period ended December 31, 2004 and 2003, were $5.4 million. Consolidated earnings for the twelve-month period ended December 31, 2004 were $20.0 million as compared to $18.5 million for the same twelve-month period ended December 31, 2003, an increase of 8%. Consolidated basic earnings per share for the twelve-month period ended December 31, 2004 and 2003, were $1.60 and $1.49, respectively.

Consolidated total assets increased 4% to $1.21 billion at December 31, 2004, as compared to $1.15 billion at December 31, 2003. Investment securities increased to $584 million at December 31, 2004, as compared to $565 million at December 31, 2003, an increase of 3%. Total consolidated shareholders’ equity rose to $141 million for the period ending December 31, 2004, as compared to $135 million for the period ended December 31, 2003, a 4% increase.

On January 19, 2005, the Board of Directors of Royal Bancshares of Pennsylvania, Inc. declared its 39^th consecutive quarterly cash dividend. This dividend will be twenty-five cents ($.25) per share for holders of Class A common stock and twenty-eight and seventy-five hundredths cents ($.2875) per share for holders of Class B common stock of Royal Bancshares of Pennsylvania, Inc. The record date is February 7, 2005, and the payment date is February 21, 2005.

Royal Bank America President and CEO Joseph P. Campbell stated, “We are extremely pleased to report our 7^th consecutive year of record earnings considering the significant expense incurred with the launch of our Korean-American division, Royal Asian Bank, and its subsequent rapid expansion.”

Royal Bancshares of Pennsylvania, headquartered in Narberth, Pennsylvania, operates sixteen full-service branch offices throughout southeastern Pennsylvania and southern New Jersey under the name Royal Bank America and three locations under the name Royal Asian Bank. Together, Royal Bank America and Royal Asian Bank offer a wide variety of products and services, including commercial real estate loans, residential mortgages, deposit accounts and Internet Banking solutions at www.royalbankamerica.com and www.royalasianbank.com.

The foregoing material is unaudited and may contain forward-looking statements. We caution that such statements may be subject to a number of uncertainties, and actual results could differ materially; therefore, readers should not place undue reliance on any forward-looking statements. Royal Bancshares does not undertake, and specifically disclaims, any obligation to publicly release the results of any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

Joseph P. Campbell, President and CEO
Royal Bancshares of Pennsylvania, Inc
Parent Company of Royal Bank America


ROYAL BANCSHARES OF PENNSYLVANIA CONDENSED INCOME STATEMENT

			Three Months Ended Dec. 31						Twelve Months Ended Dec. 31

	(in thousands, except for earnings per share)		2004			2003			2004			2003

			(Unaudited)			(Unaudited)			(Unaudited)
	Interest Income	$	16,990		$	17,938		$	67,541		$	72,320
	Interest Expense		6,809			7,053			27,301			29,941

	Net Interest Income		10,181			10,885			40,240			42,379
	Provision for Loan Losses		—			160			6			674

	Net Interest Income after Provision		10,181			10,725			40,234			41,705
	Non Interest Income		2,691			1,549			13,160			3,704
	Non Interest Expense		5,864			4,949			25,447			18,887

	Income before Taxes		7,008			7,325			27,947			26,522
	Income Taxes		1,645			1,942			7,914			7,996

	Net Income		5,363			5,383			20,033			18,526
	Earnings per share –basic ⁽¹⁾		.43			.43			1.60			1.49


SELECTED RATIOS:
	Return on Average Assets		1.8	%		1.8	%			1.7	%	1.6%
	Return on Average Equity		15.2	%		16.1	%			14.6	%	14.5%
	Average Equity to Assets		11.8	%		11.3	%			11.5	%	11.0%
	Book Value Per Share	$	11.24		$	10.79



CONDENSED BALANCE SHEET

	(in thousands)		Dec. 31, 2004 (unaudited)		Dec. 31, 2003
	Cash and Cash Equivalents	$	27,109	$	25,070
	Investment Securities		584,261		565,337
	Loans Held for Sale		2,204		3,157
	Loans (net)		454,775		500,131
	Premises and Equipment (net)		72,433		7,480
	Accrued Interest receivable		15,634		16,353
	Other Assets		48,858		36,882

	Total Assets	$	1,205,274	$	1,154,410


	Deposits	$	742,382	$	791,059
	Borrowings		278,249		212,000
	Other Liabilities		14,338		15,653
	Subordinated debentures		25,774		—
	Minority Interest		3,655		865
	Shareholders’ Equity		140,876		134,833

	Total Liabilities and Shareholders Equity	$	1,205,274	$	1,154,410


	The above 2004 financial statements include consolidation of Equity Real Estate Investments, owned by Royal Bancshares, which are required as a result of FIN 46(R) “Variable Interest Entities.”

	⁽¹⁾Earnings per share for the three-months and twelve-months ended December 31, 2003 have been restated for a stock dividend declared in 2004.