Smithtown Bancorp (SMTB)

The Company’s Ability To Pay Cash Dividends Is Limited, And It May Be Unable To Pay Future Dividends Even If It Desires To Do So

The Company’s ability to pay cash dividends may be limited by regulatory restrictions, by the Bank’s ability to pay cash dividends to the holding company and by the Company’s need to maintain sufficient capital to support its operations. The ability of the Bank to pay cash dividends to the holding company is limited by its obligations to maintain sufficient capital and by other restrictions on its cash dividends that are applicable to New York State commercial banks and banks that are regulated by the FDIC. If the Bank is not permitted to pay cash dividends to the holding company, it is unlikely that the Company would be able to pay cash dividends on its common shares.

The Company’s Ability To Pay Cash Dividends Is Limited, And It May Be Unable To Pay Future Dividends Even If It Desires To Do So

The Company’s ability to pay cash dividends may be limited by regulatory restrictions, by the Bank’s ability to pay cash dividends to the holding company and by the Company’s need to maintain sufficient capital to support its operations. The ability of the Bank to pay cash dividends to the holding company is limited by its obligations to maintain sufficient capital and by other restrictions on its cash dividends that are applicable to
New York State commercial banks and banks that are regulated by the FDIC. If the Bank is not permitted to pay cash dividends to the holding company, it is unlikely that the Company would be able to pay cash dividends on its common shares.