Kearny MHC and Kearny Financial Corp. Announce Adoption of Plan of Conversion for Second-Step Stock Offering and New Foundation

KEARNY, NJ--(Marketwired - Sep 5, 2014) - Kearny MHC (the "MHC") and Kearny Financial Corp, a federal corporation (the "Company") (NASDAQ: KRNY), the holding company for Kearny Federal Savings Bank (the "Bank"), announced today that their Boards of Directors have unanimously adopted a Plan of Conversion pursuant to which the Company will reorganize into a new stock holding company and will conduct a second-step stock offering of new shares of common stock.

As part of the conversion, the Bank will become a wholly owned subsidiary of a new stock holding company, which will also be named Kearny Financial Corp. The shares of common stock of the Company held by persons other than the MHC will be converted into shares of common stock of the new stock holding company pursuant to an exchange ratio designed to preserve the approximate percentage ownership interests of such persons. The shares of the Company held by the MHC will be cancelled and the amount of the MHC's ownership interest in the Company will be sold through the second-step stock offering. In the stock offering, depositors of the Bank and former depositors of Atlas Bank, which was recently acquired by the Bank, with qualifying deposits as of July 31, 2013 will have first priority to purchase the new shares of common stock.

In connection with the conversion, a new charitable foundation will be established by the new stock holding company with a $10.0 million contribution, consisting of $5.0 million of common stock issued in the conversion (500,000 shares) and $5.0 million of cash. The new foundation will be dedicated to the promotion of charitable purposes in the communities served by the Bank, including community development and grants and donations to support housing assistance and not-for-profit organizations. 

Craig L. Montanaro, President and Chief Executive Officer, stated, "We believe the second-step transaction will assist us in moving forward with our growth and strategic plans. We are proud to include the establishment of a new charitable foundation funded with a sizable contribution as part of our conversion as it reflects our continued commitment to the communities we serve." 

The conversion and offering will have no impact on depositors, borrowers or other customers of the Bank. The transactions contemplated by the Plan of Conversion, including the establishment and funding of the new foundation, are subject to approval by the Company's stockholders (including approval by a majority of the shares held by persons other than the MHC), the members of the MHC and the Board of Governors of the Federal Reserve System.