exceptional service for every customer drives growth

Exceptional service for every customer

drives growth, profitability,

and shareholder value at S&T Bank.

2000 Annual Report

S&T Bancorp, Inc.S&T Bancorp, Inc.

P.O. Box 190

Indiana, PA 15701

800-325-BANK

www.stbank.com

FINANCIAL HIGHLIGHTS

S & T B A N C O R P, I N C. A N D S U B S I D I A R I E S

(dollars in thousands, except per share data) 2000 1999 CHANGE CHANGE

F O R T H E Y E A R

Net Income $44,973 $41,418 $3,555 9%Return on Average Assets 2.00% 1.95% 0.05% 3Return on Average Equity 17.70 16.50 1.20 7

P e r S h a r e

Net Income—Basic $1.67 $1.52 $0.15 10%Net Income—Diluted 1.66 1.51 0.15 10Dividends Declared 0.84 0.76 0.08 11Book Value at December 31 10.28 8.88 1.40 16Market Value at December 31 21.63 23.19 (1.56) (7)

A t Ye a r- E n d

Assets $2,310,290 $2,194,073 $116,217 5%Net Loans 1,577,629 1,469,143 108,486 7Deposits 1,525,332 1,435,065 90,267 6Shareholders’ Equity 277,097 239,700 37,397 16Trust Assets 649,279 655,020 (5,741) (1)Allowance for Loan Losses/Total Loans 1.71% 1.81% (0.10)% (6)Nonperforming Loans/Total Loans 0.18 0.20 (0.02) (10)

TABLE OF

CONTENTS

1

MESSAGE TO OUR

SHAREHOLDERS

5

A YEAR IN REVIEW

20

EXECUTIVE MANAGEMENT

21

OUR MISSION

FINANCIALS

22

MANAGEMENT’S DISCUSSION

AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS

OF OPERATION

32

CONSOLIDATED

BALANCE SHEETS

33

CONSOLIDATED

STATEMENTS OF INCOME

34

CONSOLIDATED STATEMENTS

OF CHANGES IN

SHAREHOLDERS’ EQUITY

35

CONSOLIDATED STATEMENTS

OF CASH FLOWS

36

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

54

REPORT OF ERNST

& YOUNG LLP,INDEPENDENT AUDITORS

55

STOCK PRICES

AND DIVIDEND

INFORMATION, SELECTED

FINANCIAL INFORMATION

56

SELECTED FINANCIAL DATA,QUARTERLY SELECTED

FINANCIAL DATA

57

ORGANIZATION

AND CORPORATE

INFORMATION

’00’96 ’97 ’98 ’99

Net Income Per Sharein dollars

1.51

1.35

1.17

1.00

1.66

Market ValuePer Sharein dollars

23.1921.63

27.56

21.63

15.38

’00’96 ’97 ’98 ’99

DividendsDeclaredPer Sharein dollars

.76

.66

.56

.47

.84

’00’96 ’97 ’98 ’99

INVESTOR INFORMATION

S&T Bancorp, Inc. is a bank holding company organizedunder the Pennsylvania Business Corporation Law.Its wholly owned subsidiaries are S&T Bank and S&TInvestment Company, Inc. In addition, S&T Bancorp, Inc.owns a one-half interest in Commonwealth Trust CreditLife Insurance Company.

S&T Bank was started in 1902 with one office in Indianaand has grown to 39 offices that provide a full range of financial services to people in Indiana, Allegheny,Armstrong, Clarion, Clearfield, Jefferson, Westmoreland,and surrounding counties.The bank has always maintaineda sincere interest in both its customers and the successof area businesses. This concern has helped S&T meetits customers’ needs with quality banking services aswell as foster the economic vitality of its communities.

The Annual Meeting of Shareholders of S&T Bancorp, Inc.will be held at 10 a.m. on Monday, April 16, 2001 at theS&T Training and Support Center, 355 North Fifth Street,Indiana, PA.

IN D E P E N D E N T AU D I T O R S

Ernst & Young LLPOne Oxford CentrePittsburgh, PA 15219

TR A N S F E R AG E N T

If you need assistance regarding:• Change in registration of certificates• Reporting lost certificates• Information regarding the Dividend

Reinvestment Program• Information regarding Direct Deposit of cash dividends

Please contact our transfer agent:American Stock Transfer & Trust Company40 Wall Street46th FloorNew York, NY 10005800-937-5449

General Shareholders Inquiries:S&T Bancorp Shareholder ServicesSandy Ingmire(724) 465-1466 or 800-325-2265

FO R M 10-K

Copies of the Corporation’s Annual Report on Form 10-K,on file at the Securities and Exchange Commission pursuant to Section 13 of the Securities Exchange Act of1934, may be obtained free by writing to: The CorporateSecretary, S&T Bancorp, Inc., P.O. Box 190, Indiana, PA15701-0190.

S&T Bancorp, Inc. stock is traded on the Nasdaq NationalMarket System under the symbol STBA.

S&T BA N C O R P, IN C .

43 South Ninth StreetIndiana, PA 15701-3921800-325-BANKwww.stbank.com

S&T 1

We are pleased to report another solid year of steady progress for S&T Bancorp.

We achieved new records in both earnings and return on equity, and met or exceeded

virtually all of our financial goals, including a 10% improvement in earnings per share.

With this level of earnings growth, we were able to increase the dividend to our

shareholders by 11%, from $.76 per share in the previous year to $.84 per share in 2000.

Progress also continued on our long-term growth objectives, as we expanded our

branch network and our product portfolio, launched new marketing concepts and

initiatives, and strengthened our service capabilities for every customer segment and

every market we serve.

FINANCIAL PERFORMANCE

Earnings per share increased 10% to $1.66 for the year, up from $1.51 in 1999, and

net income rose 9% to $45.0 million, from $41.4 million in the previous year.

These improvements were driven by increased activity in our core business. Deposits

increased by $90.3 million, or 6%, reaching $1.5 billion at year-end 2000. Total loans

exceeded $1.6 billion for the first time, an increase of $108.7 million, or 7% from

December 31, 1999. We also benefited from an excellent performance by our investment

company, a lower effective tax rate for 2000, and somewhat fewer shares outstanding

due to our share repurchase program, now extended through 2001.

We are pleased to have achieved our financial targets despite the many challenges

facing the banking industry, particularly the continuing competitive pressures on loan

and deposit pricing, and their adverse effect on net interest margin. Although our net

interest income rose 4% to $93.1 million for the year, up from $89.9 million in 1999,

this increase was all related to volume gains in earning assets. Our net interest margin

actually declined from 4.56% in 1999 to 4.40% in 2000.

While we are still dependent on net interest income for approximately 80% of our

revenue, we are working to reduce that percentage, and it is our objective that 25%

of our total revenue will be derived from noninterest (fee) income by 2004. This is an

important strategic goal, and we made progress during the past year, as noninterest

income climbed to a record high, increasing by 12%, year over year.

Total assets reached $2.3 billion at December 31, 2000, an increase of 5% from

$2.2 billion a year ago, and return on assets improved slightly, from 1.95% to 2.00%.

Return on equity also improved significantly, climbing to 17.7% for 2000, up from

MESSAGE TO OUR SHAREHOLDERS

16.5% in 1999. Without the effects of unrealized equity gains in the available-for-sale

investment portfolio, return on equity would have been 19% and 18.7% in 2000 and

1999, respectively. Improving return on equity continues to be an important objective

for S&T, and we’re pleased to report that our profitability ratios, in general, continue

to exceed our peers.

Because the mix of our loan business has shifted in recent years, with more

commercial loan exposure, we know that problems, when they occur, will sometimes

take longer to resolve, and generally cause greater swings in nonperforming loan levels.

The past year was certainly a case in point. On a quarter-by-quarter basis,

nonperforming loans escalated to higher than usual levels, but, by year-end, several

of those problems had been resolved, and nonperforming loans returned to traditional

levels. Our loan loss reserve at year-end 2000 totaled 1.71% of our total loan portfolio.

Asset quality measurements at year-end 2000 were favorable, with nonperforming

loans totaling $2.9 million or 0.18% of total loans, as compared to $3.0 million or 0.20%

of total loans at year-end 1999. All asset quality measurements at year-end were in line

with our expectations.

S&T Investment Company continued to be a source of strong profitability for the

corporation throughout the year, despite the turbulence in the stock markets. As of

December 31, 2000, unrealized equity security gains totaled $46.7 million, compared

to $36.1 million a year ago. Equity security gains of $5.1 million were realized during the

year, but partially offset by $1.8 million of debt security losses resulting from portfolio

restructurings at S&T Bank. In total, net security gains amounted to $3.3 million, and,

in addition, S&T Investment Company also contributed $4.6 million in ordinary interest

and dividend income.

EARNINGS GROWTH & STOCK PRICE

In a perfect world, we would expect the price of a company’s stock to appreciate in line

with its growth in earnings. And that is the case for those of you who have held our

stock for a long period of time.

In 1992, the year we listed our stock on the Nasdaq Stock Market, we earned $0.65

per share, and the stock (adjusted for splits) was trading at $7.00 at year-end, or about

11 times earnings per share. At the end of this past year, with earnings per share of

$1.66, our stock was trading at about $21.00, or approximately 12 times earnings per

share. If we look at the entire period, we can see that earnings per share increased

S&T 2

2.55 times, from $0.65 to $1.66, and the stock price closely tracked that gain, increasing

3.00 times, from $7.00 to $21.00 per share.

Although no one can predict the vagaries of the stock market, we do believe that over

time the share price of our stock will tend to track growth in earnings per share. That’s

all we really have any control over, and that’s where we focus our attention, our energy,

and our resources.

STRATEGIES FOR GROWTH

To meet our growth and profitability objectives, we continue to find new and better ways

to satisfy the needs of a growing list of customers—and to do it in ways that exceed

their expectations, and, at the same time, expand our business base. This operating

philosophy is reflected in our commitment to relationship

banking and the personal-banker concept, the continued

expansion of our branch network, ongoing investments

in advanced technologies, carefully targeted marketing

initiatives, and innovative concepts in service and delivery

like our new Business Banking Center in Pittsburgh.

It is also evident in our Wealth

Management Group (formerly Investment

Management and Trust), which provides

financial services for our customers at every

stage of life, from wealth accumulation to

estate planning. To improve service levels

for a broader demographic market, we

have expanded our Wealth Management

capabilities, introduced three new

Financial Services Centers in DuBois,

Indiana, and Plum Borough, and formed

a new business unit, the S&T Insurance

Group, LLC.

Continued development of initiatives like

these—designed to meet and exceed the needs

of our customers—will remain major priorities

as we move forward. We will also continue to

evaluate potential acquisitions that meet our

Robert D. Duggan (left), and James C. Miller

S&T 4

criteria for strategic growth and service enhancements, and continuously evaluate our

current operations, not only to control expenses, but also to improve service levels.

An important contribution to our success, of course, is the ongoing counsel and

support of our Board of Directors. We would like to thank them for their efforts, and

to particularly recognize the contributions of the late Joseph Donnelly, who had served

as a Director from 1987 to 1995, and as Director Emeritus from 1995 until his death in

October 2000. His wisdom, guidance, and good humor will be greatly missed.

Also greatly deserving of our thanks is a dedicated corps of S&T Bankers, who

provide exceptional service to our customers and, in the process, make S&T a very

special place to work. Those efforts were recognized in 2000 when S&T Bank was

selected as one of the 100 Best Places to Work in Pennsylvania through a competition

spearheaded by the Pennsylvania Department of Community and Economic

Development. We are very pleased with the recognition, and especially proud that 75%

of the award criteria was based on the confidential opinions of our own staff.

Before closing, we would like to welcome our newest Board member, Michael J.

Donnelly, president and publisher of Indiana Printing and Publishing Company, Inc.

We also want to recognize Gregor T.Young IV, executive vice president and managing

director of our Wealth Management Group, who joined S&T in March 2000. In other

management changes, Kathi Greenwell was promoted to senior vice president,

employee services; and Mark Kochvar, to senior vice president and treasurer, responsible

for treasury activities, asset liability management, and financial planning.

Finally, we thank you, the shareholders of S&T Bancorp, for your confidence and

support, and we look forward to another year of continued progress for our company.

Sincerely,

Robert D. Duggan

Chairman

James C. Miller

President and Chief Executive Officer

An ongoing commitment to exceptional service for each

and every customer brought strong returns in 2000.

S&T Bank achieved record earnings for the year, and

significantly increased value for shareholders—a 10%

improvement in earnings per share, an 11% increase

in the dividend, and a 17.7% return on equity.

With an expanding portfolio of high-quality products

and financial services for consumers and businesses,

customer-focused initiatives, continued advancements

in electronic technologies, and a wide-reaching branch

network, S&T significantly strengthened its service

capabilities in all of its markets. And, at the same time,

a dedicated corps of S&T Bankers sharpened their focus

on the individual needs of every customer, providing truly

exceptional service for the “Customer of One.”

S&T 5

Exceptional Service for the “Customer of One”

COMMUNITY BANKING

Through a wide range of delivery channels and a well-established network

of 39 branch offices, S&T Bank provides easy access to a broad spectrum of high-quality

financial products and services. S&T serves more than 90,000 consumer households

and businesses in Allegheny, Armstrong, Clarion, Clearfield, Indiana, Jefferson, and

Westmoreland counties.

To strengthen its presence in the Murrysville area, S&T will open its newest

office—a full-service financial center—in spring 2001. This 4,000-square-foot facility will

be a new “home base”for personal and business bankers, mortgage originators, and

financial advisors.

THE PERSONAL TOUCH

“Personal bankers”at all branch offices continued to strengthen customer relationships

throughout 2000, and contributed significantly to a deposit growth of $90.3 million,

a 6% increase over the previous year.

Personal banking depends upon the skills of S&T bankers in effectively profiling their

customers to evaluate their current financial services, anticipate their future needs, and

determine how S&T can help them meet their financial goals. S&T continued its

Personal Banker Certification Program throughout 2000, focusing on a number of new

initiatives to improve customer profiling and selling skills, including intensive training

in sales techniques and telemarketing.

In order to increase efficiencies in consumer lending and provide personal bankers

with additional time for consumer service functions, S&T is automating the entire

underwriting process for consumer loans and will be implementing a new consumer

credit processing system. Based on predefined criteria, consumer loans will be evaluated

centrally. Loan system interface capabilities will significantly reduce paperwork, greatly

enhance turnaround time and facilitate instantaneous communication with the frontline

staff. The new system is expected to be operational in the second quarter of 2001.

Exceptional service is “business as usual” for personal bankers like ShellyMyers (right), meeting withS&T Greensburg customerHenna Bautista. Because of the personal banker program,introduced in 1999, S&T customers now have one singlesource for all of their financialservices needs, and, throughadvanced automation technologies, those needs can be anticipated before the questions are even asked.

S&T 6

Personal bankers, serving as single contact points for

both deposit accounts and consumer loan products,

underscore S&T’s commitment to exceptional service

on a personal level, building and maintaining mutually

beneficial, long-term relationships with each and every

customer, the “Customer of One.”

S&T 7

S&T 8

Also under way is an effort to improve workflow efficiency in the lending process

by consolidating and integrating commercial loan processing, documentation, consumer

loan operations, mortgage processing, and the consumer loan service center.

A representative committee was formed late in 2000 to develop new organizational

options, and the consolidation should be complete by the third quarter of 2001.

BUILDING CUSTOMER RELATIONSHIPS

Because customer relationships are the primary focus at S&T Bank, a Customer

Relationship Management (CRM) Committee was formed during the past year

to integrate marketing strategies and coordinate customer communications across the

entire organization. The CRM Committee consists of representatives from community

banking, advanced technology, operations, marketing, finance, and related areas. This

inter-disciplinary approach involves everything that touches the customer, from business

correspondence, signage in the branch offices, and statement inserts, to telemarketing

efforts, direct mail programs, and advertising campaigns. The overall objective is to create

added value for the customer by matching specific financial needs with S&T products

and services, based on customer profiles and behaviors.

Other promotional strategies are focused on market segmentation, with the women’s

segment remaining a high priority. An education-based marketing approach, initiated

in 1999, continued to gain momentum throughout 2000. Under the“For Women Only”

banner, the bank published a series of specialized newsletters, and hosted regional

luncheons and a half-day seminar focused on the concerns and challenges facing

women today. In addition, the bank is a supporter of Seton Hill College’s National

Education Center for Women in Business through a three-year sponsorship of its

“women @ work”broadcast fax for women entrepreneurs. The bank was also a sponsor

of Seton Hill’s women-focused small business conference, ”Building a World-Class

Business: Network locally, Grow globally”, held in March 2001.

MULTIPLE DELIVERY CHANNELS

For maximum customer convenience, S&T provides around-the-clock service, seven

days a week, through a wide range of alternative delivery channels, from traditional

ATMs and automated telephone-banking services to a fully staffed Direct Banking

Center, and, most recently, personal computers and Internet banking.

“Understanding insurance and investment

options” and “designing a financial strategy” were

only two of the topics explored at S&T’s second

annual “For Women Only” Conference,

centerpiece of an ongoing marketing initiative

addressing the major concerns of this powerful

market segment.

S&T 9

At S&T’s “For Women Only”Conference last October,attendees were introduced to keynote speaker and politicalpollster, Kellyanne Fitzpatrick(right), president and chiefexecutive officer of the pollingcompanyTM, based inWashington, D.C. Part of a continuing marketingprogram, the annual conferenceexplored topics ranging frompersonal financial planning to the power of women at the polls.

S&T 10

Internet technology initiatives in 2000, driven by customer demand for even greater

convenience and designed to provide new opportunities in fee revenue, included

a re-design of the bank’s Web site (www.stbank.com), adding more feature functionality

as well as improving navigational efficiency. Added features include easy links to new

S&T services, such as TrustNet, enabling trust customers to quickly review their

portfolios; InvestNet, providing a fast connection to S&T Brokerage Services1; and

a comprehensive “mortgage center.” Users can access mortgage tips and terms, calculate

payments for fixed-rate loans, find answers to frequently asked questions, and identify

the closest S&T mortgage specialist in their geographic area.

The Web site also connects S&T customers to ExpressNet, a new online banking

product launched in March 2000. ExpressNet is available to all customers who have

Internet access, and allows them to check account balances; view account activity,

including deposits, withdrawals, and electronic transactions; access credit card

transactions; transfer funds; and pay bills online.

Another new feature of the revised Web site is “My S&T,”a portal—or gateway—to the

World Wide Web that can be customized to the user’s lifestyle and special interests, such

as news, weather, sports, stock prices, shopping, entertainment, and more. By establishing

a portal at the bank’s Web site, users can eliminate time-consuming navigation through

multiple sites to find the information they need, and there’s no cost for the service.

COMMERCIAL LENDING

Building on significant strength in the business sector, S&T Bank continued to expand its

capabilities in helping businesses of all sizes meet their strategic objectives. Commercial

lending remained a particular strength, with the bank’s average commercial loan

portfolio increasing by 17%, as compared to 1999. Cash management services have also

grown significantly, with average fee revenue increasing 25% over the past three years.

New initiatives, launched in 2000, were designed to broaden the business-customer

base, add new deposit relationships, and enhance electronic service capabilities for all

business banking customers.

The father-and-son team of Tom and Mike Jennison areblending traditional productionsavvy with a new idea to find a high-tech niche. Tom spentmost of his life building a tool-and-die operation inCarnegie, Pa. And when Mikejoined the business, he added a new piece of telecomequipment to the productroster—control boxes forsophisticated home-wiringsystems. The success of thecompany, Jennison Greyfox, is testament to a son’s visionrealized in practical terms by the father’s industrial know-how and entrepreneurialenergy. Here, Tom (center) andMike (right) inspect one of theircontrol boxes with S&T vicepresident and commercial loanofficer Bob Salerno.

A wide range of products and services — including

commercial loans, letters of credit, commercial mortgages,

depository products, and cash management services — help

businesses of all sizes increase their efficiencies, reduce

costs, improve profitability, and meet their growth objectives.

S&T 12

As co-owner of RichardLawrence Interiors, in Pittsburgh, Lawrence Walkerknows the importance ofexceptional customer serviceand quality products. That’swhy he relies on S&T’sBusiness Banking Unit for thefinancial services his smallbusiness needs. Here, he meetswith S&T vice president andbusiness banking manager,Monica Ziegler, at the bank’snew Business Banking Center,opened in July 2000.

BUSINESS BANKING CENTER

In July 2000, S&T introduced a new concept in the delivery of products and services for

the business community with the opening of the S&T Business Banking Center in the

Shadyside section of Pittsburgh. Within its five-mile radius, S&T currently serves a broad

customer base, accounting for approximately $150.0 million in commercial loans. This

new physical presence—combined with an S&T Deposit Courier Service—will not only

enhance service for existing customers, but is also expected to encourage additional

deposit relationships among the 600 commercial businesses in close proximity.

TARGETING THE SMALL BUSINESS

Another major initiative of 2000 was the formation of a new banking unit designed

to increase capabilities in meeting the special needs of businesses with annual sales up

to $1.0 million. Staffed by dedicated business bankers—and integrated with consumer

banking and commercial lending—the Business Banking Unit is focused on full-service

relationships. It provides owners of small businesses with a wide selection of products

and services, ranging from credit facilities and operating accounts to cash management,

merchant processing, 401(k) opportunities, financial advisory services, and e-commerce.

New products specifically developed for small businesses have also been introduced, and

a targeted advertising campaign, supported by new brochures and other promotional

materials, rolled out in September 2000.

E-BUSINESS SOLUTIONS

Using Internet-banking technology to enhance business banking and cash management

products and services is another important strategy, and to accelerate that effort, S&T’s

cash management and electronic banking departments have been merged into a new

department called “e-business solutions.”

In addition to providing cash management services, the new department has also

introduced an array of e-business products that allow S&T business customers to

manage cash more efficiently, maintain their own sweep accounts, and accept credit card

transactions through the Internet. With S&T’s new Business Express product, business

customers can originate direct deposit and electronic payment entries, wire transfers,

and review daily account transaction detail from their desktops.

S&T 13

Addressing a geographic market segment of nearly

600 commercial enterprises in the Shadyside section

of Pittsburgh, S&T’s new Business Banking Center offers

a full range of financial products and services for the

business customer, including employee benefit programs

and Internet services.

As owners of the Clarion FruitCompany in Clarion, Pa.,brothers, Mike and BruceCherico, (left to right in thetruck) know that rapid businessgrowth is a nice problem. Theyalso know that a great solutionis an experienced S&T businessbanker, like Rod Silvis (far left),delivering personal, individualservice and a wide range offinancial products designed to grow with the needs of smallbusinesses like Clarion Fruit.

To enhance business banking and cash

management products and services, S&T

Bank is harnessing the power of the

Internet and, through new e-business

solutions, enabling its customers

to quickly and efficiently handle

a variety of financial transactions

from the convenience of their

own desktops.

S&T 15

S&T is currently developing an online Internet business resource center and other

e-commerce initiatives for businesses. These leading-edge products and services are

expected to enhance fee revenue, and also serve as stepping stones to S&T’s complete

array of financial services, deepening the relationships between the bank and its

business customers.

WEALTH MANAGEMENT

To better reflect the scope of products and services currently offered—and the direction

charted for future growth and expansion—S&T’s Investment Management and Trust

Services (IM&T) business was re-named the Wealth Management Group. A new

advertising campaign will be launched to underscore its full capabilities. Focused on

investment management, financial/retirement planning, and estate planning, the new

campaign clearly illustrates how wealth management services can be used at any stage

of life as a means of achieving financial and investment goals.

Although traditional products and services remain high priorities, Wealth Management

is expanding its capabilities to provide optimum service to a broader demographic

market, including clients in every phase of wealth accumulation.

To enhance service for clients with accounts of $150,000 or less—while simultaneously

improving administrative efficiencies—S&T has introduced the Wealth Management

Group Select Unit to administer personal accounts of all types from trusts to IRAs, as well

as charitable and non-employee benefit, corporate accounts. By calling 800-446-0246,

clients will have access to a qualified team of professionals who can answer their

questions on a variety of financial subjects. To optimize response time, the Select Unit will

have online access to all pertinent client information. The Unit will be supported by the

expertise and resources of the entire Wealth Management Group.

For high-net-worth individuals and for employers providing retirement plans for

their employees, Wealth Management continues to offer investment services, financial

planning capabilities, employee benefit services, and long-term trusts to protect a family’s

S&T 16

finances or a company’s employee benefit program. Market value of assets under

management reached $649.3 million by year-end, generating $3.8 million in fee

revenue in 2000. In addition, intensified efforts in expense control resulted in a

significant improvement in net contribution from trust relationships, as compared

to the previous year.

For customers who prefer to manage their own investment portfolios, S&T Brokerage

Services1, a branch office of Raymond James Financial Services, Inc., provides fast access

to all financial markets, comprehensive research capabilities, including mutual fund

reports and opinions, and easy linkage to Bridge Channel, Dow Jones, and related

Internet sites. In 2000, brokerage trades increased by 31% over the previous year, and

total commissions increased by 87%.

FINANCIAL SERVICES CENTERS

In January 2000, S&T introduced three new Financial Services Centers in DuBois,

Indiana, and Plum Borough, designed to provide all customers with a direct link to

the bank’s investment and financial planning expertise through the branch network.

A fourth center will be added in 2001 with the opening of the new branch office

in Murrysville, and additional expansions are on the drawing board.

Financial Services Center advisors, drawing from a complete range of investment

strategies and products—including individual stocks and bonds, mutual funds1, and

annuities1—can guide individual investors through a comprehensive financial planning

process to help them accumulate the savings they need for their children’s education,

a secure retirement, or any other targeted goal. For small business owners and the

self-employed, they can help identify the best possible approach to retirement plans

and employee benefits, whether it be an IRA, a SEP, a 401(k), profit-sharing, or another

qualified retirement plan.

Setting goals is one thing;knowing how to reach them is another. That’s where S&T’sWealth Management Group can really help. Professionalssuch as (left to right) Greg Young, executive vicepresident and managing director, Steve Leach, vicepresident–brokerage servicesmanager, and Cliff McBroom,financial advisor, can helpcustomers choose from a widerange of investment options to match their individualobjectives and risk parameters.

S&T 17

S&T’s Wealth Management Group is reaching out to the “emerging

affluent” market with new services designed to support the wealth

accumulation process, while continuing to provide comprehensive

wealth management and trust services to protect a family’s finances

or a company’s employee benefit plan.

S&T 18

S&T INSURANCE GROUP

In keeping with an overall strategy of providing a full array of financial solutions—

from deposit and lending products to wealth management services, including brokerage

services1, mutual funds1, annuities1, trusts, and investment management—S&T expanded

into the insurance arena in 2000 with the formation of the S&T Insurance Group, LLC.

The addition of insurance products to the bank’s product/service portfolio

strengthens S&T’s position as a full-service financial services provider, and provides new

opportunities for increased fee revenue.

1. Securities are offered exclusively through Raymond James Financial Services, Inc., Member

NASD/SIPC, an independent broker/dealer, and are not FDIC insured, not guaranteed by the Financial

Institution, subject to risk, and may lose value. Raymond James Financial Services, Inc. is not affiliated

with S&T Bank; S&T Insurance Group, LLC; S&T Wealth Management Group; or The Guardian Life

Insurance Company of America.

SERVING THE COMMUNITY

S&T’s ongoing commitment to the communities it serves was clearly demonstrated

during 2000, not only by loans made available to municipalities and non-profit

organizations, but also by the time, talent, and financial contributions made by the bank

and its bankers to a wide variety of charities, hospitals, schools and churches, local

governments, and civic and community-service organizations. The S&T Charitable

Foundation committed or contributed almost $250,000 to qualified charities. With the

generous support of many local businesses and organizations, the Third Annual S&T

Bank Charity Golf Classic raised more than $20,000 for charitable organizations

nominated by S&T bankers.

S&T 19

At S&T’s Annual All-EmployeeMeeting in January 2001, morethan 600 staffers celebrated thepast year’s success, as theyrecharged their batteries for thechallenges and opportunitiesahead. This year’s meeting,focused on even higher levelsof customer service and featured keynote speaker, DougLipp, California-based consultant and former trainer atDisneyland and the head oftraining at Disney’s CorporateHeadquarters, Disney Studios.

Exceptional customer service depends on a supportive work

environment, and that’s exactly what the bank provides, according

to S&T Bankers, whose response to a confidential opinion survey

accounted for 75% of the criteria used in selecting S&T Bank as one

of the 100 Best Places to Work in Pennsylvania. In its category of 251

employees or more, S&T Bank ranked fourth among 50 selected

companies. The competition was spearheaded by the Pennsylvania

Department of Community and Economic Development.

S&T 20

S&T BANCORP EXECUTIVE MANAGEMENT

JAMES C. MILLER

President and

Chief Executive Officer

JAMES G. BARONE

President

S&T Investment Company, Inc.

EDWARD C. HAUCK

Executive Vice President

Administration and

Planning

DAVID L. KRIEGER


Commercial Lending

ROBERT E. ROUT

Executive Vice President, Chief

Financial Officer and Secretary

J. JEFFREY SMEAD


Credit Administration

GREGOR T. YOUNG IV, J.D.

Executive Vice President and

Managing Director

Wealth Management

TODD D. BRICE

Senior Vice President

Commercial Lending

RICHARD A. FISCUS


Branch Administration

D. KATHLEEN GREENWELL


Employee Services

H. WILLIAM KLUMPP


Marketing

MARK KOCHVAR


and Treasurer

EDWARD A. ONDERICK


Retail Lending

DAVID P. RUDDOCK


Operations and Technology

From left to right: H. William Klumpp,

Robert E. Rout,Edward C. Hauck,Richard A. Fiscus,

Edward A. Onderick,Gregor T. Young,David L. Krieger,

Mark Kochvar,J. Jeffrey Smead,

James C. Miller,Todd D. Brice,

James G. Barone,David P. Ruddock,

D. Kathleen Greenwell

S&T 21

To achieve consistent superior financial

performance which creates value for our

shareholders by:

Identifying and satisfying customer needs with

quality services and products which exceed

their expectations;

Providing a stimulating and challenging team

oriented work environment which encourages,

develops and rewards excellence;

Diligently serving our communities with

integrity and pride.

Our Mission

F I N A N C I A L C O N D I T I O N

The $143.5 million growth of average earning assets in

2000 was primarily the result of an excellent lending year

for S&T Bancorp, Inc. (S&T), combined with increases in

the investment portfolio. During 2000, average loan balances

increased by $127.0 million, and average securities and

L E N D I N G A C T I V I T Y

Average loans at December 31, 2000 were $1.5 billion,

a $127.0 million or 8.9% increase from December 31, 1999.

The increases in average loans for 1999 were $106.9 million.

Changes in the composition of the average loan portfolio

during 2000 included increases of $142.1 million of com-

mercial loans and $10.3 million of home equity loans, offset

by decreases of $12.9 million of residential mortgages and

$12.5 million in installment loans. Composition changes

included decreases from the effects of $5.2 million of 1–4

family mortgage loans and $13.4 million of commercial

loans that were sold or participated in 2000.

Average commercial, mortgage and industrial loans

currently comprise 64% of the loan portfolio. Although

commercial loans can be an area of higher risk, management

believes these risks are mitigated by underwriting guidelines

and ongoing review by loan administration.

Residential mortgage lending continued to be a strategic

focus for 2000 through the establishment of a centralized

mortgage origination department, product redesign, secondary

market activities and the utilization of commission

compensated originators. Management believes that if a

downturn in the local residential real estate market occurs,

the impact of declining values on the real estate loan

portfolio will be negligible because of S&T’s conservative

mortgage lending policies for portfolio loans which generally

require a maximum term of 20 years for fixed rate mortgages,

a maximum term of 30 years for adjustable rate mortgages

and private mortgage insurance for loans with less than a

20% down payment. Adjustable rate mortgages with

repricing terms of one, three and five years comprised 19%

of the residential mortgage portfolio in 2000.

Much of the decline in average residential loans was

due to more active participation in the secondary mortgage

markets and reduced market demand. S&T periodically

sells longer-term, lower yielding 1–4 family mortgages to

the Federal National Mortgage Association (Fannie Mae).

The rationale for these sales is to mitigate interest rate risk

associated with holding long-term residential mortgages in

the loan portfolio, to generate fee revenue from servicing,

and still maintain the primary customer relationship.

During 2000, S&T sold $5.2 million of 1–4 family mort-

gages to Fannie Mae. Fees and gains from mortgage

servicing activities were $0.3 million in 2000. S&T will

continue to sell longer-term loans to Fannie Mae in the

future on a selective basis, especially during periods of

lower interest rates.

Installment loan decreases were primarily associated

with significantly lower volumes in the indirect auto loan

category and S&T’s strategy to continue to focus resources

toward origination of direct installment loans and home

equity loans. Pricing pressures were unusually intense in

the indirect auto loan market during the last few years, and

the decision was made to exit this line of business and

allow the portfolio to amortize through normal payments

and payoffs. Home equity loans increased $10.3 million

during 2000 as compared to the 1999 full year average.

federal funds increased $16.4 million.The funding for this loan

and security growth was provided by a $78.6 million increase

in average deposits, a $52.0 million increase in average

borrowings and an increase of $3.0 million in average

earnings retained.

M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A LY S I S O F

F I N A N C I A L C O N D I T I O N A N D R E S U LT S O F O P E R A T I O N S

S&T Bancorp, Inc. and Subsidiaries

2000 1999

Average Loan Loan Balance Average Loan Loan Balance(in millions) Balance Percentage Balance Percentage

Commercial, mortgage and industrial $ 983.7 64% $ 841.6 59%Residential real estate mortgage 470.3 30 472.9 33Installment 94.9 6 107.4 8

Total Loans $1,548.9 100% $1,421.9 100%

S&T 22

S&T 23

Loan underwriting standards for S&T are established

by a formal policy administered by the S&T Bank Credit

Administration Department, and are subject to the periodic

review and approval of the S&T Bank Board of Directors.

Rates and terms for commercial real estate and equip-

ment loans normally are negotiated, subject to such variables

as economic conditions, marketability of collateral, credit

history of the borrower and future cash flows. The loan to

value policy guideline for commercial real estate loans is

generally 75%–80%.

The residential, first lien, mortgage loan to value policy

guideline is 80%. Higher loan to value loans can be approved

with the appropriate private mortgage insurance coverage.

Second lien positions are sometimes incurred with home

equity loans, but normally only to the extent that the combined

credit exposure for both first and second liens does not

exceed 100% loan to value.

A variety of unsecured and secured installment loan and

credit card products is offered by S&T. However, the major-

ity of the installment loan portfolio is automobile loans. Loan

to value guidelines for direct loans are 90%–100% of invoice

for new automobiles and 80%–90% of National Automobile

Dealer Association (NADA) value for used automobiles.

Management intends to continue to pursue quality loans

in all lending categories within our market area in order to

honor our commitment to provide comprehensive financial

services to our customers. S&T’s loan portfolio primarily

represents loans to businesses and consumers in our market

area of western Pennsylvania rather than to borrowers in

other areas of the country or to borrowers in other nations.

During the past several years, management has concentrated

on building an effective credit and loan administration staff

which assists management in evaluating loans before they

are made and identifies problem loans early.

S E C U R I T Y A C T I V I T Y

Average securities increased $5.9 million in 2000 and

$11.5 million in 1999. During 2000 and 1999, S&T’s bond

portfolio was restructured with sales and maturities of

$78.2 million and $238.7 million, respectively, of U.S.

government agency securities classified as available for sale.

The proceeds were reinvested in order to extend potential

call dates. Interest rate risk associated with these strategies

is managed and monitored through S&T’s Asset Liability

Committee (ALCO).

The largest components of the 2000 increase included

$11.9 million in other corporate securities, $4.6 million in

corporate equities and $9.7 million in Federal Home Loan

Bank (FHLB) stock. The FHLB stock is a membership and

borrowing requirement. Offsetting these increases are

decreases of $7.6 million in U.S. treasury securities, $8.1 million

of U.S. government agency securities, $1.2 million in mortgage-

backed securities and $3.4 million in tax-exempt state and

municipal securities.

During 2000, S&T sold $27.2 million of equity securities

classified as available for sale. The sales were made in order

to maximize returns when market opportunities are presented.

Additionally, S&T may receive an exchange of shares relative

to mergers; gains and losses are recognized on shares held

of acquired institutions in accordance with Emerging Issues

Task Force #91-5, Nonmonetary Exchange of Cost-Method

Investments (EITF 91-5). The equity securities portfolio is

primarily comprised of bank holding companies, as well as

preferred and utility stocks to take advantage of the dividends

received deduction for corporations. During 2000, the

equity portfolio yielded 9.4% on a fully taxable equivalent

basis and had unrealized gains at December 31, 2000, net

of unrealized losses, of $46.7 million.

S&T’s policy for security classification includes U.S.

treasuries, U.S. government agencies, mortgage-backed

securities, corporate debt securities and marketable equity

securities as available for sale. Municipal securities and one

corporate debt security are classified as held to maturity.

At December 31, 2000, unrealized gains, net of unrealized

losses, for securities classified as available for sale were

approximately $50.0 million.

A L L O W A N C E F O R L O A N L O S S E S

The year-end balance in the allowance for loan losses

increased slightly to $27.4 million or 1.71% of total loans at

December 31, 2000 as compared to $27.1 million or 1.81%

of total loans at December 31, 1999. Net loan charge-offs

totaled $3.7 million for 2000 compared to $3.5 million for 1999.

Included in the net loan charge-offs for 2000 is a $1.7 million

recovery received on a previously charged-off floor plan loan

in 1998, and a $3.8 million charge-off to one commercial

real estate borrower.

The adequacy of the allowance for loan losses is

determined by management through evaluation of the loss

potential on individual nonperforming, delinquent and high-

dollar loans; review of economic conditions and business

trends; historical loss experience; and growth and composition

of the loan portfolio, as well as other relevant factors.

A quantitative analysis is utilized to support the adequacy

of the allowance for loan losses. This analysis includes

review of the high and low historical charge-off rates for

loan categories, fluctuations and trends in the amount of

classified loans and economic factors. Economic factors

consider the level of S&T’s historical charge-offs that have

occurred within the credits’ economic life cycle.

Significant to this analysis is the shift in loan portfolio

composition to an increased mix of commercial loans. These

loans are generally larger in size, and, due to our continuing

growth, many are not well seasoned. Management relies

on its risk rating process to monitor trends which may be

occurring relative to commercial loans to assess potential

weaknesses within the credit. Current economic factors and

trends in risk ratings are considered in the determination of

the allowance for loan losses.

N O N E A R N I N G A S S E T S

Average noninterest earning assets increased $9.1 million

in 2000 and $21.6 million in 1999.The 2000 and 1999 increase

can be primarily attributed to a $25.0 million bank-owned

life insurance (BOLI) investment entered into during June

of 1999, which provides S&T with other income through

increases in the cash surrender value of the BOLI. The 2000

increase is offset by a decrease in vault cash.

The balance of nonperforming loans, which includes

nonaccrual loans past due 90 days or more, at December 31,

2000, was $2.9 million or 0.18% of total loans. This compares

to nonperforming loans of $3.0 million or 0.20% of total

loans at December 31, 1999.

Asset quality is a major corporate objective at S&T, and

management believes the total allowance for loan losses is

adequate to absorb probable loan losses.

D E P O S I T S

Average total deposits increased by $78.6 million in 2000

and $71.1 million in 1999.The mix of average deposits in 2000

changed with time deposits increasing $53.5 million, money

market accounts and interest-bearing demand deposits

increasing $25.3 million, offset by savings account decreases

of $13.2 million. Noninterest-bearing deposits increased by

$13.0 million or 6% in 2000 and were approximately 15%

of total deposits during 2000 and 1999, respectively. Some

of the changes can be partially explained by strategic initia-

tives to increase demand accounts and cash management

services. In addition, a competitive strategy for money market

account pricing was implemented in order to make these

accounts more competitive with money funds offered at

brokerage firms.

Management believes the S&T deposit base is stable

and S&T has the ability to attract new deposits, mitigating

a funding dependency on volatile liabilities. Special rate

deposits of $100,000 and over were 8% and 6% of total

deposits during 2000 and 1999, respectively, and primarily

represent deposit relationships with local customers in our

market area. In addition, S&T has the ability to access both

public and private markets to raise long-term funding if

necessary. At December 31, 2000, there were $3.5 million of

brokered retail certificates of deposit outstanding.

2000 1999

Allowance Loan Balance Allowance Loan BalanceAllowance for Loan Losses (in millions) Balance Percentage Balance Percentage

Commercial, mortgage and industrial $ 18.8 64% $ 20.1 59%Residential real estate mortgage 0.9 30 0.9 33Installment 2.8 6 2.5 8Unallocated 4.9 — 3.6 —

Total $ 27.4 100% $ 27.1 100%

S&T 24

S&T 25

N E T I N C O M E

Net income was a record $45.0 million or $1.66 per diluted

earnings per share in 2000, representing a 9% and 10%

increase, respectively, from the $41.4 million or $1.51 per

diluted earnings per share in 1999. The return on average

assets increased to 2.00% for 2000, as compared to 1.95%

for 1999. The return on average equity increased to 17.70%

for 2000, compared to 16.50% for 1999. Without the equity

effects of unrealized gains in the available for sale invest-

ment portfolio, return on average equity would have been

19.0% and 18.7% in 2000 and 1999, respectively. Increases

to the net interest income, other revenue and a lower effec-

tive tax rate contributed significantly to this enhanced

earnings performance.

N E T I N T E R E S T I N C O M E

On a fully taxable equivalent basis, net interest income

increased $3.3 million or 4% for 2000 compared to 1999.

The net yield on interest-earning assets decreased to 4.40%

in 2000 as compared to 4.55% in 1999. The decline in the

net yield on interest-earning assets during 2000 was primarily

attributable to the competitive pressures on loan and deposit

pricing. Net interest income was positively affected by the

$143.5 million or 7% increase in average earning assets.

In 2000, average loans increased $127.0 million and

average securities increased $5.9 million, comprising most

of the earning asset growth. The yields on average loans

increased by 42 basis points and the yields on average

securities increased 32 basis points. Overall funding costs

increased 142 basis points.

Average interest-bearing deposits provided $65.6 million

of the funds for the growth in average earning assets, at a

cost of 4.51% in 2000 as compared to 3.98% in 1999.

Average increases of $52.0 million in REPOS and other

borrowed funds provided additional funding. The cost of

these funds increased 89 basis points during 2000. During

2000 more longer-term borrowings were utilized in order

to better manage interest rate risk.

Also positively affecting net interest income was a

$25.8 million increase to average net free funds. Average

net free funds are the excess of demand deposits, other

noninterest-bearing liabilities and shareholders’ equity over

nonearning assets.

Maintaining consistent spreads between earning assets

and costing liabilities is very significant to S&T’s financial

performance since net interest income comprised 80% of

operating revenue. The level and mix of earning assets and

funds are continually monitored by ALCO in order to mitigate

the interest rate sensitivity and liquidity risks of the balance

sheet. A variety of asset/liability management strategies was

successfully implemented, within prescribed ALCO risk

parameters, that enabled S&T to maintain a net interest

margin consistent with historical levels.

B O R R O W I N G S

Average borrowings increased $52.0 million in 2000 and

were comprised of securities sold under repurchase agree-

ments (REPOS), federal funds purchased and long-term

borrowings at the FHLB. S&T defines REPOS with its retail

customers as retail REPOS; wholesale REPOS are those

transacted with other banks and brokerage firms with

terms normally ranging from one to 14 days.

The average balance in retail REPOS decreased by $7.4

million for 2000 and $0.1 million for 1999. S&T views retail

REPOS as a relatively stable source of funds since most of

these accounts are with local, long-term customers.

Wholesale REPOS and federal funds purchased averaged

$21.2 million in 2000, a decrease of $30.9 million from the

1999 averages. The increase in deposits and the availability

of reasonably priced long-term borrowings from the FHLB

decreased the usage of these types of fundings in 2000.

The interest rate risk of various funding strategies is

managed through ALCO. During 2000, ALCO authorized

three additional long-term borrowings of $116.1 million at

a fixed rate with the FHLB and long-term repurchase

agreement borrowings. At December 31, 2000, S&T had

long-term borrowings outstanding of $265.6 million at a

fixed rate with the FHLB and $112.4 million of long-term

repurchase agreement borrowings. The purpose of these

borrowings was to provide matched fundings for newly

originated loans, to mitigate the risk associated with

volatile liability fundings, to take advantage of lower cost

funds through the FHLB’s Community Investment

Program and to fund stock buy-backs.

T R U S T A S S E T S

The year-end market value balance of the S&T Bank Trust

Department assets, which are not accounted for as part

of the assets of S&T, decreased 1% in 2000 and 1999. The

decreases were the result of general decreases in the debt

and equity markets during the years.

R E S U LT S O F O P E R A T I O N S

Year Ended December 31, 2000

P R O V I S I O N F O R L O A N L O S S E S

The provision for loan losses is an amount added to the

allowance against which loan losses are charged. The

provision for loan losses was $4.0 million for 2000 and 1999.

The provision expense is the result of management’s assess-

ment of economic conditions, credit quality statistics, loan

administration effectiveness and other factors that would

have an impact on probable losses in the loan portfolio.

Credit quality statistics are an important factor in deter-

mining the amount of provision expense. Net loan charge-offs

totaled $3.7 million for 2000 compared to $3.5 million for

1999. Included in the net loan charge-offs for 2000 is a

$1.7 million recovery received on a previously charged-off

floor plan loan in 1998, and a $3.8 million charge-off to one

commercial real estate borrower. Nonperforming loans to

total loans decreased slightly to 0.18% at December 31, 2000.

Also affecting the amount of provision expense is loan growth

and portfolio composition. Most of the loan growth in 2000

and 1999 is attributable to larger-sized commercial loans.

N O N I N T E R E S T I N C O M E

Noninterest income, excluding net security gains, increased

$2.0 million or 12% in 2000 compared to 1999. Increases

included $0.6 million or 9% in service charges and fees

and $1.6 million or 24% increase in other income, offset

by a decrease of $0.2 million in trust fees. Security gains

were approximately the same in 2000 compared to 1999.

The increase in service charges on deposit accounts

was primarily the result of management’s continued effort

to implement reasonable fees for services performed and

to manage closely the collection of these fees, as well as

expanding new cash management relationships.

The increase in other income was a result of increased

performance for brokerage and insurance commissions,

letters of credit fees, covered calls, merchant and debit card

commissions as well as a full year effect of BOLI investment

income. These areas were the focus of several strategic

initiatives and product enhancements implemented in

order to expand this source of revenue.

S&T recognized $5.1 million of gains on equity securities

during 2000. $0.4 million was the result of Emerging Issues


Investments (EITF 91-5). This accounting pronouncement

requires the mark to market of equity securities when an

acquisition of the company in which securities are owned

occurs. EITF 91-5 gains recognized were all attributable to

$0.4 million from the Keystone/M&T merger. The remaining

security gains were primarily attributable to the sales of equity

securities in order to maximize returns by taking advantage

of market opportunities when presented. Offsetting these

gains were $1.8 million in losses from the aforementioned

restructuring of the available for sale bond portfolio.

N O N I N T E R E S T E X P E N S E

Noninterest expense increased $2.2 million or 5% in 2000

compared to 1999. The increase is primarily attributable

to increased employment, occupancy and equipment, data

processing and other expenses. S&T’s efficiency ratio, which

measures noninterest expense as a percent of recurring

noninterest income plus net interest income on a fully taxable

equivalent basis, was 41% in 2000 and 1999, respectively.

Staff expense increased 3% or $0.7 million in 2000.

The increase resulted from normal merit increases offset

by lower pension funding costs in 2000. Average full-time

equivalent staff was 661 in 2000 and 659 in 1999.

Occupancy and equipment expense increased 7% or

$0.4 million as compared to 1999. This increase is primarily

attributable to the opening of a new branch office in Allegheny

County and small equipment purchases. Data processing

increased 10% or $0.2 million in 2000 as compared to 1999

due to a refund of an overbilling received from our third

party processor in 1999.

Other expenses increased 6% or $0.8 million as compared

to 1999. This increase included $0.6 million in legal fees

related to increased activity in loan collections as well as

the formation of S&T Insurance Group, LLC. Other expense

increases of $0.2 million were not significant and reflect

normal changes due to activity increases, organization

expansion, consulting engagements for our fee products

and operations areas, and fee increases from vendors.

F E D E R A L I N C O M E TA X E S

Federal income tax expense decreased $0.4 million to

$17.6 million in 2000 primarily as a result of a lower effective

tax rate in 2000. The 2000 effective tax rate of 28% was below

the 35% statutory tax rate due to the tax benefits resulting

from tax-exempt interest, excludable dividend income and

the tax benefits associated with Low Income Housing Tax

Credit (LIHTC) projects. S&T currently does not incur any

alternative minimum tax.

S&T 26

S&T 27

N E T I N C O M E

Net income was $41.4 million or $1.51 per diluted earnings

per share in 1999, representing a 12% increase from the

$38.0 million or $1.35 per diluted earnings per share in 1998.

The return on average assets increased to 1.95% for 1999,

as compared to 1.90% for 1998. The return on average equity

increased to 16.50% for 1999, compared to 14.80% for 1998.

Increases to the net interest margin and other revenue con-

tributed significantly to this enhanced earnings performance.

N E T I N T E R E S T I N C O M E

On a fully taxable equivalent basis, net interest income

increased $4.6 million or 5% for 1999 compared to 1998.

The net yield on interest-earning assets decreased slightly

to 4.55% in 1999 as compared to 4.61% in 1998. The decline

in the net yield on interest-earning assets during 1999 was

primarily attributed to the implementation of a BOLI invest-

ment program, as well as our share repurchase program that

repurchased approximately 834,000 shares of S&T common

stock. Net interest income was positively affected by the

$123.5 million or 7% increase in average earning assets.

In 1999, average loans increased $106.9 million and

average securities increased $11.5 million, comprising most

of the earning asset growth. The yields on average loans

decreased by 28 basis points and the yields on average

securities decreased 12 basis points. Overall funding costs

decreased 47 basis points.

Average interest-bearing deposits provided $71.1 million

of the funds for the growth in average earning assets, at a

cost of 3.98% in 1999 as compared to 4.34% in 1998.

Average increases of $65.8 million in REPOS and other

borrowed funds provided additional funding. The cost of

these funds decreased 11 basis points during 1999. During

1999, more longer-term borrowings were utilized in order

to mitigate interest rate risk.

Also positively affecting net interest income was a

$13.3 million increase to average net free funds. Average

net free funds are the excess of demand deposits, other

noninterest-bearing liabilities and shareholders’ equity

over nonearning assets.

Maintaining consistent spreads between earning assets

and costing liabilities is very significant to S&T’s financial

performance since net interest income comprised 84% of

operating revenue. The level and mix of earning assets and

funds are continually monitored by ALCO in order to miti-

gate the interest rate sensitivity and liquidity risks of the

balance sheet. A variety of asset/liability management

strategies was successfully implemented, within prescribed

ALCO risk parameters, that enabled S&T to maintain a net

interest margin consistent with historical levels.

P R O V I S I O N F O R L O A N L O S S E S

The provision for loan losses is an amount added to

the allowance against which loan losses are charged.

The provision for loan losses was $4.0 million for 1999

compared to $10.6 million in 1998.

Net loan charge-offs totaled $3.5 million for 1999

compared to $4.3 million for 1998. Included in the charge-

offs for 1998 is $2.0 million related to a floor plan loan to

one automobile dealership. Nonperforming loans to total

loans decreased to 0.20% at December 31, 1999. Also

affecting the amount of provision expense is loan growth

and portfolio composition. Most of the loan growth in 1999

and 1998 is attributable to larger-sized commercial loans.

R E S U LT S O F O P E R A T I O N S

Year Ended December 31, 1999


Noninterest income, excluding net security gains, increased

$3.2 million or 23% in 1999 compared to 1998. Increases

included $0.3 million or 8% in trust income, $0.7 million

or 12% in service charges and fees and a $2.2 million or

49% increase in other income. Security gains decreased

$7.5 million or 70%.

The increase in trust income was attributable to

bankwide incentive programs and expanded marketing efforts

designed to develop new trust business and to develop

new relationships within the Allegheny County market.

The increase in service charges on deposit accounts

was primarily the result of management’s continued effort

to implement reasonable fees for services performed and

to manage closely the collection of these fees, as well as

expanding new cash management relationships.

The increase in other income was a result of increased

performance for brokerage and insurance commissions,

letters of credit fees, covered calls, credit and debit card

commissions, mortgage servicing income, as well as BOLI

investment income. These areas were the focus of several

1999 strategic initiatives and product enhancements imple-

mented in order to expand this source of revenue.

S&T recognized $5.7 million of gains on equity securities

during 1999. $1.3 million was the result of Emerging Issues


Investments (EITF 91-5). This accounting pronouncement

requires the mark to market of equity securities when an

acquisition of the company in which securities are owned

occurs. EITF 91-5 gains recognized included $0.7 million

from the First Western Bancorp/Sky Financial merger and

$0.6 million from the BankBoston/Fleet Boston merger.

The remaining security gains were primarily attributable

to the sales of equity securities in order to maximize returns

by taking advantage of market opportunities when presented.

Offsetting these gains were $2.5 million in losses from

the aforementioned restructuring of the available for sale

bond portfolio.


Noninterest expense increased $1.5 million or 4% in 1999

compared to 1998. The increase is primarily attributable

to increased employment and other expenses. S&T’s

efficiency ratio, which measures noninterest expense as a

percent of recurring noninterest income plus net interest

income on a fully taxable equivalent basis, was 41% and

42% in 1999 and 1998, respectively.

Staff expense increased 3% or $0.6 million in 1999.

The increase resulted from normal merit increases and higher

incentive payouts relative to commercial loan activity and

credit insurance sales. Average full-time equivalent staff

was 659 in 1999 and 1998.

Other expenses increased 10% or $1.2 million as

compared to 1998. This increase included $0.3 million of

goodwill related to a branch purchase in the third quarter

of 1998, $0.3 million in telephone expense relating to the

implementation of a wide area computer communications

network and a $0.3 million recovery of a previously

charged-off fraud loss in 1998. Other expense increases

of $0.3 million were not significant and reflect normal

changes due to activity increases, organization expansion,

consulting engagements for our fee products and opera-

tions areas and fee increases from vendors.

F E D E R A L I N C O M E TA X E S

Federal income tax expense increased $1.8 million to

$18.0 million in 1999 as a result of higher pretax income

in 1999. The 1999 effective tax rate of 30% was below the

35% statutory tax rate due to the tax benefits resulting from

tax-exempt interest, excludable dividend income and the

tax benefits associated with Low Income Housing Tax

Credit (LIHTC) projects. S&T currently does not incur any

alternative minimum tax.

S&T 28

S&T 29

Liquidity and Interest Rate Sensitivity

Liquidity refers to the ability to satisfy the financial needs

of depositors who want to withdraw funds or borrowers

needing access to funds to meet their credit needs. Interest

rate sensitivity management seeks to avoid fluctuating

net interest margins and to enhance net interest income

through periods of changing interest rates. ALCO is

responsible for establishing and monitoring the liquidity and

interest rate sensitivity guidelines, procedures and policies.

The principal sources of asset liquidity are cash and due

from banks, interest-earning deposits with banks, federal

funds, investment securities that mature in one year or less,

and securities available for sale. At December 31, 2000, the

total of such assets was approximately $674.6 million or

29% of consolidated assets. However, liability liquidity is

much more difficult to quantify, but is further enhanced by

a stable core deposit base, access to credit lines at other

financial institutions and S&T’s ability to renew maturing

deposits. Certificates of deposit in denominations of

$100,000 or more represented 8% of deposits at December

31, 2000 and were outstanding primarily to local customers.

S&T’s ability to attract deposits and borrowed funds

depends primarily on continued rate competitiveness,

profitability, capitalization and overall financial condition.

Beyond the issue of having sufficient sources to fund

unexpected credit demands or deposit withdrawals, liquid-

ity management also is an important factor in monitoring

and managing interest rate sensitivity issues through

ALCO. Through forecast and simulation models, ALCO is

also able to project future funding needs and develop

strategies for acquiring funds at a reasonable cost.

ALCO uses a variety of measurements to monitor the

liquidity position of S&T. These include liquidity gap, liquidity

forecast, net loans and standby letters of credit to assets,

net loans to deposits and net noncore funding dependence

ratio. As of December 31, 2000, all of these measurements

were in compliance with ALCO policy limitations.

Because the assets and liabilities of S&T are primarily

monetary in nature, the presentation and analysis of cash

flows in formats prescribed by Financial Accounting

Standards Board Statement No. 95 “Statement of Cash

Flows”(Statement No. 95) are less meaningful for manag-

ing bank liquidity than for other non-financial companies.

Funds are typically provided from current earnings,

maturity and sales of securities available for sale, loan

repayments, deposits and borrowings. The primary uses

of funds include new loans, repayment of borrowings, the

purchase of securities and dividends to shareholders. The

level and mix of sources and uses of funds are constantly

monitored and adjusted by ALCO in order to maintain

credit, liquidity and interest rate risks within prescribed

policy guidelines while maximizing earnings.

ALCO monitors and manages interest rate sensitivity

through gap, simulation and duration analyses in order to

avoid unacceptable earnings fluctuations due to interest

rate changes. S&T’s gap model includes certain manage-

ment assumptions based upon past experience and the

expected behavior of customers during various interest rate

scenarios. The assumptions include principal prepayments

for mortgages, installment loans and classifying the demand,

savings and money market balances by degree of interest

rate sensitivity. Utilizing the above assumptions results in

ratios of interest rate sensitive assets to interest rate sensitive

liabilities for the six-month and 12-month intervals ended

December 31, 2000 of 1.04% and 1.00%, respectively.

Assuming immediate repricings for interest-bearing demand,

savings and money market accounts, these ratios would be

0.78% and 0.82%, respectively.

In addition to the gap analysis, S&T performs an earn-

ings sensitivity analysis to identify more dynamic interest

rate risk exposures.

An earnings simulation model is used to estimate the

effect that specific interest rate changes would have on 12

months of pretax earnings. Derivative financial instruments

are included in this exercise. The model incorporates

management assumptions regarding the level of interest

rate or balance changes on indeterminate maturity deposit

products (savings, money market, NOW and demand

deposits) for a given level of market rate changes. These

assumptions have been developed through a combination

of historical analysis and future expected pricing behavior.

Interest rate caps and floors on all products are included to

the extent that they become effective in the 12-month

simulation period. Additionally, changes in prepayment

behavior of the residential mortgage portfolio in each rate

environment are captured using management estimates.

Finally, the impact of planned growth and anticipated new

business activities is factored into the simulation model.

S&T’s policy objective is to limit the change in annual

pretax earnings to $2.8 million from an immediate and

sustained parallel change in interest rates of 200 basis points.

As of December 31, 2000 and 1999, respectively, S&T had

the following estimated earnings sensitivity profile:

Immediate Change in Rates

(in millions) +200bp -200bp

2000 Pretax earnings change $ 1.1 $(2.5)

1999 Pretax earnings change $(0.2) $(1.2)

Results of the gradual simulation model, showing

changes from current rates by 200 basis points over a

12-month period as of December 31, 2000 and 1999 are

presented below.

Gradual Change in Rates

(in millions) +200bp -200bp

2000 Pretax earnings change $ 0.4 $(2.0)

1999 Pretax earnings change $(0.1) $ 0.4

C A P I TA L R E S O U R C E S

Shareholders’ equity increased $37.4 million at December

31, 2000 compared to December 31, 1999. The primary

source of equity growth for S&T is earnings retention.

Hence, capital growth is a function of net income less divi-

dends paid to shareholders and treasury stock activities.

Net income was $45.0 million and dividends declared

to shareholders were $22.7 million for 2000. S&T paid 49%

of 2000 net income in dividends, equating to an annual

dividend rate of $0.84 per share. Also affecting capital was

an increase of $16.1 million in unrealized gains on securi-

ties available for sale. During 2000, S&T repurchased

62,400 shares of its common stock. The repurchase of up to

1,000,000 shares in 2000 was authorized by the S&T Board

of Directors. In December 2000, this authorization was

extended for 2001.

The book value of S&T’s common stock increased

15.8% from $8.88 at December 31, 1999 to $10.28 at

December 31, 2000, primarily due to earnings retention

and the increase in unrealized holding gains on securities

available for sale and by the stock buy-backs during 2000.

S&T continues to maintain a strong capital position

with a leverage ratio of 10.4% as compared to the 2000

minimum regulatory guideline of 3%. S&T’s risk-based

capital Tier 1 and Total ratios were 12.3% and 14.6%,

respectively, at December 31, 2000, which places S&T well

above the Federal Reserve Board’s risk-based capital guide-

lines of 4% and 8% for Tier 1 and Total, respectively.

Included in the total ratio is 45% of the pretax unrealized

holding gains on available for sale equity securities as pre-

scribed by banking regulations effective October 1, 1998. In

addition, management believes that S&T has the ability to

raise additional capital if necessary.

In April 1993, shareholders approved the S&T Incentive

Stock Plan (Stock Plan) authorizing the issuance of a maxi-

mum of 1,200,000 shares of S&T’s common stock in order

to assist in attracting and retaining employees of outstand-

ing ability and to promote the identification of their inter-

ests with those of the shareholders of S&T. On October 17,

1994, the Stock Plan was amended to include outside

directors. On April 21, 1997, shareholders approved an

amendment to the plan increasing the number of autho-

rized shares to 3,200,000. As of December 31, 2000,

2,572,122 nonstatutory stock options had been granted to

key employees and outside directors; 1,415,422 of these

options are currently exercisable.

R E G U L AT O R Y M AT T E R S

S&T and S&T Bank are subject to periodic examinations

by one or more of the various regulatory agencies. During

2000, an examination was conducted by the Pennsylvania

Department of Banking (PADB). This examination included,

but was not limited to, procedures designed to review

lending practices, credit quality, liquidity, operations and

capital adequacy of S&T and its subsidiaries. No comments

were received from the PADB which would have a material

effect on S&T’s liquidity, capital resources or operations.

S&T’s current capital position and results of regulatory

examination allow it to pay the lowest possible rate for

FDIC deposit insurance.

I N F L AT I O N

Management is aware of the significant effect inflation has

on interest rates and can have on financial performance.

S&T’s ability to cope with this is best determined by

analyzing its capability to respond to changing interest

rates and its ability to manage noninterest income and

expense. S&T monitors its mix of interest rate sensitive

assets and liabilities through ALCO in order to reduce

the impact of inflation on net interest income. Management

also controls the effects of inflation by reviewing the prices

of its products and services, by introducing new products

and services and by controlling overhead expenses.

S&T 30

S&T 31

B U S I N E S S U N C E R TA I N T I E S

There are many uncertainties regarding the economy as

S&T enters 2001. Interest rates are expected to decline, and

the economy is slowing. S&T anticipates net loan growth

of about 6-8 percent and deposit growth of approximately

2-4 percent for the year. S&T also anticipates that our net

interest margin will decrease another 5-10 basis points for

the year. Fee income is projected to increase 10-12 percent

in 2001. The $119 million of equity securities in our S&T

Investment Company should allow S&T to recognize

$4-6 million of equity security gains in 2001. S&T believes

the combination of these factors, along with anticipated

increases in noninterest expense, should allow us to grow

earnings per share by 5-8 percent in 2001 to a range

of $1.75 to $1.79

There are many factors that could influence our results,

both positively and negatively, this year. Because the majority

of revenue comes from the net interest margin, internally

generated deposit growth and the mix of that growth are

major factors. S&T has directed a fair amount of focus and

resources in our planning for this year to help do a better

job of generating and retaining low cost core deposits.

On the other hand, a slowing economy could cause deteri-

oration in the asset quality measurements; we recognize

that the shift to a greater dependence on commercial loans

in recent years exposes us to larger credit risks and greater

swings in nonperforming loans and charge-offs when

problems do occur. However, because of S&T’s adequate

allowance for loan losses, earnings strength and strong

capitalization, as well as the strength of other businesses

in our market area, management does not expect a decline

in S&T’s ability to satisfactorily perform if further decline

in our economy occurs.

While S&T believes the year ahead presents more and

greater uncertainties and challenges than other recent years,

S&T has a plan in place that should allow us to improve

our earnings this year to the levels indicated above.

“ S A F E H A R B O R ” S TAT E M E N T U N D E R T H E P R I V AT E

S E C U R I T I E S L I T I G AT I O N R E F O R M A C T O F 1 9 9 5

The statements in this Annual Report, which are not historical

fact, are forward looking statements that involve risks and

uncertainties, including, but not limited to, the interest rate

environment, the effect of federal and state banking and tax

regulations, the effect of economic conditions, the impact

of competitive products and pricings, and other risks detailed

in S&T’s Securities and Exchange Commission filings.

C O N S O L I D A T E D B A L A N C E S H E E T S


December 31 2000 1999

(dollars in thousands, except per share data)

A S S E T S

Cash and due from banks $ 43,665 $ 38,663Federal funds sold 6,655 15,454Securities:

Available for sale 567,400 557,994Held to maturity (market value $13,703

in 2000 and $17,527 in 1999) 13,512 17,230

Total Securities 580,912 575,224

Loans, net of allowance for loan lossesof $27,395 in 2000 and $27,134 in 1999 1,577,629 1,469,143

Premises and equipment 20,390 20,678Other assets 81,039 74,911

Total Assets $2,310,290 $2,194,073

L I A B I L I T I E S

Deposits:Noninterest-bearing $ 232,625 $ 219,202Interest-bearing 1,292,707 1,215,863

Total Deposits 1,525,332 1,435,065

Securities sold under repurchase agreements 80,686 116,009Long-term borrowings 377,997 364,062Other liabilities 49,178 39,237

Total Liabilities 2,033,193 1,954,373

S H A R E H O L D E R S ’ E Q U I T Y

Preferred stock, without par value, 10,000,000shares authorized and none outstanding — —

Common stock ($2.50 par value)Authorized—50,000,000 shares in 2000 and 1999Issued—29,714,038 shares in 2000 and 1999 74,285 74,285

Additional paid-in capital 21,028 21,070Retained earnings 201,435 179,129Accumulated other comprehensive income 32,502 16,410Treasury stock (2,766,626 shares in 2000

and 2,715,221 shares in 1999, at cost) (52,153) (51,194)

Total Shareholders’ Equity 277,097 239,700

Total Liabilities and Shareholders’ Equity $2,310,290 $2,194,073

See Notes to Consolidated Financial Statements.

S&T 32

S&T 33

C O N S O L I D A T E D S T A T E M E N T S O F I N C O M E


Year Ended December 31 2000 1999 1998


I N T E R E S T I N C O M E

Loans, including fees $137,797 $120,333 $115,081Federal funds sold 1,347 547 314Investment securities:

Taxable 29,623 29,377 29,984Tax-exempt 771 942 1,557Dividends 6,646 5,528 4,502

Total Interest Income 176,184 156,727 151,438

I N T E R E S T E X P E N S E

Deposits 56,467 47,278 49,570Securities sold under repurchase agreements 5,863 6,519 8,968Federal funds purchased 139 229 383Long-term borrowings 23,672 15,916 10,235

Total Interest Expense 86,141 69,942 69,156

N E T I N T E R E S T I N C O M E 90,043 86,785 82,282

Provision for Loan Losses 4,000 4,000 10,550

Net Interest Income After Provisionfor Loan Losses 86,043 82,785 71,732


Security gains, net 3,260 3,240 10,722Service charges on deposit accounts 6,810 6,234 5,548Trust fees 3,758 3,936 3,661Other 8,326 6,690 4,487

Total Noninterest Income 22,154 20,100 24,418


Salaries and employee benefits 23,466 22,726 22,086Occupancy, net 3,007 2,855 2,759Furniture and equipment 2,689 2,445 2,688Other taxes 1,667 1,540 1,456Data processing 2,473 2,256 2,411Amortization of intangibles 447 447 112FDIC assessment 294 238 228Other 11,615 10,983 10,248

Total Noninterest Expense 45,658 43,490 41,988

Income Before Income Taxes 62,539 59,395 54,162Applicable Income Taxes 17,566 17,977 16,199

Net Income $ 44,973 $ 41,418 $ 37,963

P E R C O M M O N S H A R E :

Net Income—Basic $ 1.67 $ 1.52 $ 1.37Net Income—Diluted 1.66 1.51 1.35Dividends Declared 0.84 0.76 0.66


AccumulatedAdditional Other

Comprehensive Common Paid-In Retained Comprehensive Treasury DeferredIncome Stock Capital Earnings Income Stock Compensation


Balance at January 1, 1998 $ — $37,142 $19,369 $175,707 $40,524 $(12,494) $(130)

Comprehensive Income:Net income for 1998 37,963 37,963

Other comprehensive income, net of tax: Net unrealized securities losses (563) (563)

Cash dividends declared($0.66 per share) 1 (18,253)

Treasury stock acquired (1,117,036 shares) (27,975)Treasury stock issued (510,305 shares) (802) 6,352Tax Deductibility/Options 2,667Deferred ESOP benefits expense 130Transfer to reflect two-for-one stock split 37,143 (37,143)

Comprehensive Income $37,400

Balance at December 31, 1998 $74,285 $21,234 $158,274 $39,961 $(34,117) $ —


Other comprehensive income, net of tax: Net unrealized securities losses (23,551) (23,551)

Cash dividends declared($0.76 per share) (20,563)

Treasury stock acquired (834,207 shares) (20,007)Treasury stock issued (157,445 shares) (684) 2,930Tax Deductibility/Options 520




Other comprehensive income, net of tax: Net unrealized securities gains 16,092 16,092

Cash dividends declared($0.84 per share) (22,667)

Treasury stock acquired (62,400 shares) (1,166)Treasury stock issued (10,995 shares) (66) 207Tax Deductibility/Options 24



1 Per share amounts have been restated to record the effect of a two-for-one common stock split in the form of a 100% stock dividend distributed on October 30, 1998.


C O N S O L I D A T E D S T A T E M E N T S O F C H A N G E S I N S H A R E H O L D E R S ’ E Q U I T Y


S&T 34

S&T 35

C O N S O L I D A T E D S T A T E M E N T S O F C A S H F L O W S


Year Ended December 31 2000 1999 1998

(dollars in thousands)

O P E R AT I N G A C T I V I T I E S

Net Income $ 44,973 $ 41,418 $ 37,963Adjustments to reconcile net income to net cash

provided by operating activities:Provision for loan losses 4,000 4,000 10,550 Provision for depreciation and amortization 2,356 2,220 2,158 Net amortization of investment security premiums 330 588 609 Net accretion of loans and deposit premiums (271) — —Deferred income taxes 48 1,228 (807)Securities gains, net (3,260) (3,240) (10,722)

(Increase) decrease in interest receivable (1,282) 451 157 Increase (decrease) in interest payable 1,628 484 (139)

(Increase) decrease in other assets (4,625) (25,338) 776 Decrease in other liabilities (1,156) (1,377) (2,214)

Net Cash Provided by Operating Activities 42,741 20,434 38,331

I N V E S T I N G A C T I V I T I E S

Net decrease (increase) in federal funds sold 8,799 3,899 (19,251)Proceeds from maturities of investment securities 5,708 5,778 20,772 Proceeds from maturities of securities available for sale 35,762 116,428 192,105 Proceeds from sales of securities available for sale 102,219 268,230 96,233 Purchases of securities available for sale (121,689) (407,755) (323,130)Net increase in loans (112,214) (133,911) (96,456)Purchases of premises and equipment (2,105) (1,892) (1,933)Other, net 37 (74) 215 Net cash acquired in branch acquisition — — 31,604

Net Cash Used in Investing Activities (83,483) (149,297) (99,841)

F I N A N C I N G A C T I V I T I E S

Net increase in demand, NOW and savings deposits 14,518 47,589 81,553 Net increase (decrease) in certificates of deposit 75,749 7,414 (25,213)Net decrease in federal funds purchased — — (9,325)Net decrease in repurchase agreements (35,323) (22,817) (31,299)Proceeds from long-term borrowings 116,075 203,844 120,850 Payments from long-term borrowings (102,140) (79,850) (25,000)Acquisition of treasury stock (1,025) (17,761) (27,975)Exercise of stock options and related tax benefit 24 520 8,219 Cash dividends paid to shareholders (22,134) (20,149) (17,515)

Net Cash Provided by Financing Activities 45,744 118,790 74,295

Increase (decrease) in Cash and Cash Equivalents 5,002 (10,073) 12,785 Cash and Cash Equivalents at Beginning of Year 38,663 48,736 35,951

Cash and Cash Equivalents at End of Year $ 43,665 $ 38,663 $ 48,736


The financial statements of S&T Bancorp, Inc. and

subsidiaries (S&T) have been prepared in accordance with

accounting principles generally accepted in the United

States. In preparing the financial statements, management

is required to make estimates and assumptions that affect

the reported amounts of assets and liabilities as of the date

of the balance sheet and revenues and expenses for the

period. Actual results could differ from those estimates. The

more significant accounting policies are described below.

P R I N C I P L E S O F C O N S O L I D AT I O N

The consolidated financial statements include the accounts

of S&T. All significant intercompany transactions have been

eliminated in consolidation. The investment in subsidiaries

is carried at S&T’s equity in the underlying net assets.

S E C U R I T I E S

Management determines the appropriate classification of

securities at the time of purchase. If management has the

intent and S&T has the ability at the time of purchase to

hold securities until maturity, they are classified as held to

maturity and are stated at cost adjusted for amortization of

premiums and accretion of discounts. All obligations of

states and political subdivisions and one corporate security

are classified as held to maturity. Securities to be held for

indefinite periods of time are classified as available for sale

and are recorded at market value. All U.S. treasury securities,

U.S. government corporations and agencies, mortgage-

backed securities, all other corporate securities and

marketable equity securities are classified as available for

sale. Gains or losses on the disposition of securities are

based on the specific identification method. S&T does not

engage in any securities trading activity.

L O A N S

Interest on loans is accrued and credited to operations

based on the principal amount outstanding. Accretion of

discount on loans is included in interest income. Loan

origination fees and direct loan origination costs are

deferred and amortized as an adjustment of loan yield over

the respective lives of the loans. Loans are placed on

nonaccrual and interest is discontinued when collection of

interest or principal is doubtful, or generally when interest

and principal are 90 days or more past due.

Impaired loans are defined by management as

commercial and commercial real estate loans for which

it is probable that the Bank will not be able to collect all

N O T E A

Accounting Policies

amounts due according to the contractual terms of the loan

agreement. Residential real estate mortgages and consumer

installment loans are large groups of smaller balance

homogenous loans and are separately measured for

impairment collectability. Factors considered by manage-

ment in determining impairment include payment status

and underlying collateral value. All impaired loans are

classified as substandard for risk classification purposes.

Impaired loans are charged-off, to the estimated value of

collateral associated with the loan, when management

believes principal and interest are deemed uncollectible.

The accrual of interest on impaired loans is discontinued

when, in management’s opinion, the borrower may be

unable to meet the payments as they become due. When

interest accrual is discontinued, all unpaid accrued interest

is reversed. Interest income is subsequently recognized

only to the extent that cash payments are received.

The allowance for loan losses is established through

provisions for loan losses charged against income. Loans

considered to be uncollectible are charged against the

allowance, and recoveries, if any, are credited to the

allowance. The allowance for loan losses is maintained at a

level believed adequate by management to absorb probable

losses in the loan portfolio. Management’s determination

of the adequacy of the allowance is based on periodic eval-

uations of the loan portfolio, past loan loss experience,

current economic conditions, volume, growth and compo-

sition of the loan portfolio and other relevant factors.

P R E M I S E S A N D E Q U I P M E N T

Premises and equipment are stated at cost less accumu-

lated depreciation. The provision for depreciation is

computed generally by the straight-line method for finan-

cial reporting purposes and by accelerated methods for

federal income tax purposes.

O T H E R R E A L E S TAT E

Other real estate is included in other assets and is comprised

of properties acquired through foreclosure proceedings

or acceptance of a deed in lieu of a foreclosure and loans

classified as in-substance foreclosure. These properties are

carried at the lower of cost or fair value less projected cost

of resale. Loan losses arising from the acquisition of such

property are charged against the allowance for loan losses.

Gains or losses realized subsequent to acquisition are

recorded in the results of operations.

N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S


S&T 36

S&T 37

S&T’s business activities are currently confined to one

segment which is community banking.

C A S H F L O W I N F O R M AT I O N

S&T considers cash and due from banks as cash and cash

equivalents. For the years ended December 31, 2000,

1999 and 1998, cash paid for interest was $84,572,000,

$69,518,000 and $69,295,000, respectively. Cash paid

during 2000 for income taxes was $18,483,000 compared

to $14,368,000 for 1999 and $15,567,000 for 1998.

M O R T G A G E L O A N S E R V I C I N G

Mortgage servicing assets are recognized as separate assets

when servicing rights are acquired through purchase or

loan originations, when there is a definitive plan to sell the

underlying loan. Capitalized mortgage servicing rights are

reported in other assets and are amortized into noninterest

income in proportion to, and over the period of, the esti-

mated future net servicing income of the underlying

mortgage loans. Capitalized mortgage servicing rights are

evaluated for impairment based on the fair value of those

rights. For the year ended December 31, 2000 and 1999, the

1-4 family mortgage loans that were sold to the Federal

National Mortgage Association (Fannie Mae) amounted to

$5.2 million and $16.1 million, respectively. At December

31, 2000 and 1999, servicing assets were $492,000 and

$463,000, respectively.

D E R I V AT I V E F I N A N C I A L I N S T R U M E N T S

As of January 1, 2001, S&T adopted Financial Accounting

Standards Board Statement No. 133, “Accounting for

Derivative Instruments and Hedging Activities”(Statement

No. 133), as amended by Financial Accounting Standards

Board Statement No. 138, “Accounting for Certain Derivative

Instruments and Certain Hedging Activities,”(Statement

No. 138) which requires measuring and recording the change

in fair value of derivative instruments. S&T does not exten-

sively use derivative financial instruments. Historically, the

only type that S&T utilizes is interest rate swaps. At December

31, 2000, S&T had no swaps outstanding. The adoption of

these statements did not materially affect S&T’s financial

position or results of operations.

R E C L A S S I F I C AT I O N

Amounts in prior years have been reclassed to conform to

presentation in 2000. The reclassification had no effect on

financial condition or results of operations.

I N C O M E TA X E S

Deferred tax assets and liabilities are reflected at currently

enacted income tax rates applicable to the period in which

the deferred tax assets or liabilities are expected to be

realized or settled.

T R U S T A S S E T S A N D I N C O M E

Assets held in a fiduciary capacity by the subsidiary bank,

S&T Bank (Bank), are not assets of the Bank and are there-

fore not included in the consolidated financial statements.

Trust fee income is reported on the accrual basis.

P E N S I O N S

Pension expense for the Bank’s defined benefit pension

plan is actuarially determined using the projected unit

credit actuarial cost method. The funding policy for the

plan is to contribute amounts to the plan sufficient to meet

the minimum funding requirements of the Employee

Retirement Income Security Act of 1974, plus such addi-

tional amounts as may be appropriate, subject to federal

income tax limitations.

T R E A S U R Y S T O C K

The purchase of S&T common stock is recorded at cost.

At the time of reissue, the treasury stock account is reduced

using the average cost method.

E A R N I N G S P E R S H A R E

Basic Earnings Per Share (EPS) is calculated by dividing net

income by the weighted average number of common

shares outstanding during the period. Average shares

outstanding for computing basic EPS were 26,988,541,

27,168,529 and 27,762,801 for 2000, 1999 and 1998, respec-

tively. Options, warrants and other potentially dilutive

securities are excluded from the basic calculation, but are

included in diluted EPS. Average shares outstanding for

computing dilutive EPS were 27,073,945, 27,366,986 and

28,055,142 for 2000, 1999 and 1998, respectively. In

computing dilutive EPS, average shares outstanding have

been increased by the common stock equivalents relating

to S&T’s outstanding stock options.

O P E R AT I N G S E G M E N T S

An operating segment is defined as a component of an

enterprise that engages in business activities that generate

revenue and incur expense, and the operating results of

which are reviewed by the chief operating decision maker

in the determination of resource allocation and performance.

D E P O S I T S

The fair values disclosed for demand deposits (e.g., non-

interest and interest-bearing demand, money market and

savings accounts) are, by definition, equal to the amount

payable on demand. The carrying amounts for variable-

rate, fixed-term certificates of deposit and other time

deposits approximate their fair value at year-end. Fair

values for fixed-rate certificates of deposit and other time

deposits are based on the discounted value of contractual

cash flows, using interest rates currently being offered for

deposits of similar remaining maturities.

S H O R T- T E R M B O R R O W I N G S A N D O T H E R

B O R R O W E D F U N D S

The carrying amounts of federal funds purchased, borrow-

ings under repurchase agreements and other borrowings

approximate their fair values.

L O N G - T E R M B O R R O W I N G S

The fair values disclosed for long-term borrowings are

estimated using current interest rates for long-term

borrowings of similar remaining maturities.

L O A N C O M M I T M E N T S A N D

S TA N D B Y L E T T E R S O F C R E D I T

Estimates of the fair value of these off-balance sheet items

were not made because of the short-term nature of these

arrangements and the credit standing of the counterparties.

Also, unfunded loan commitments relate principally to

variable-rate commercial loans, and fees are not normally

assessed on these balances.

Estimates of fair value have not been made for items

which are not defined as financial instruments, including

such items as S&T’s core deposit intangibles and the value

of its trust operation. S&T believes it is impractical to esti-

mate a representational fair value for these types of assets,

which represent significant value to S&T.

S&T utilized quoted market values, where available, to

assign fair value to its financial instruments. In cases where

quoted market values were not available, S&T used present

value methods to estimate the fair value of its financial

instruments. These estimates of fair value are significantly

affected by the assumptions made and, accordingly, do not

necessarily indicate amounts which could be realized in a

current market exchange. S&T does not expect to realize

the estimated amounts disclosed.

The following methods and assumptions were used by

S&T in estimating its fair value disclosures for financial

instruments:

C A S H A N D C A S H E Q U I V A L E N T S A N D O T H E R

S H O R T- T E R M A S S E T S

The carrying amounts reported in the consolidated balance

sheet for cash and due from banks, interest-earning

deposits with banks and federal funds sold approximate

those assets’ fair values.

S E C U R I T I E S

Fair values for investment securities and securities available

for sale are based on quoted market prices.

L O A N S

For variable-rate loans that reprice frequently and with no

significant change in credit risk, fair values are based on

carrying values. The fair values for other loans are esti-

mated using discounted cash flow analyses, using interest

rates currently being offered for loans with similar terms to

borrowers as measured by net credit losses and the loss of

interest income from nonaccrual loans. The carrying

amount of accrued interest approximates its fair value.

N O T E B

Fair Values of Financial Instruments

S&T 38

S&T 39

The following table indicates the estimated fair value of

S&T’s financial instruments as of December 31:

The Board of Governors of the Federal Reserve Bank

impose certain reserve requirements on all depository

institutions. These reserves are maintained in the form

of vault cash or as a noninterest-bearing balance with

the Federal Reserve Bank. Required reserves averaged

$10,036,000 during 2000.

2000 1999

Estimated Carrying Estimated Carrying(dollars in thousands) Fair Value Value Fair Value Value

A S S E T S

Cash $ 43,665 $ 43,665 $ 38,663 $ 38,663 Federal funds sold 6,655 6,655 15,454 15,454 Securities:

Available for sale 567,400 567,400 557,994 557,994 Held to maturity 13,703 13,512 17,527 17,230

Loans 1,596,566 1,605,024 1,487,385 1,496,277


Deposits $1,526,803 $1,525,332 $1,436,040 $1,435,065 Securities sold under repurchase

agreements 80,686 80,686 116,009 116,009 Long-term borrowings 381,933 377,997 356,009 364,062

O F F - B A L A N C E S H E E T

Interest rate swaps $ — $ — $ 22 $ —

N O T E C

Restrictions on Cash and Due from Bank Accounts

N O T E D

Securities

The following table indicates the composition of the

securities portfolio at December 31:Available for Sale

Gross GrossAmortized Unrealized Unrealized Market

2000 Cost Gains Losses Value


Obligations of U.S. governmentcorporations and agencies $331,846 $ 3,824 $ (873) $334,797

Mortgage-backed securities 5,405 158 — 5,563 U.S. treasury securities 10,564 637 — 11,201 Corporate securities 64,633 240 (636) 64,237

Debt securities available for sale 412,448 4,859 (1,509) 415,798 Marketable equity securities 67,665 50,211 (3,559) 114,317 Other securities 37,285 — — 37,285

Total $517,398 $55,070 $ (5,068) $567,400

Held to Maturity

Obligations of states and political subdivisions $ 11,512 $ 181 — $ 11,693 Corporate securities 2,000 10 — 2,010

Total $ 13,512 $ 191 $ — $ 13,703

Available for Sale

Gross GrossAmortized Unrealized Unrealized Market

1999 Cost Gains Losses Value


Obligations of U.S. government corporations and agencies $345,329 $ 86 $ (9,474) $335,941

Mortgage-backed securities 6,179 12 (21) 6,170U.S. treasury securities 13,709 417 — 14,126Corporate securities 66,395 11 (1,880) 64,526

Debt securities available for sale 431,612 526 (11,375) 420,763Marketable equity securities 61,635 42,073 (5,979) 97,729Other securities 39,502 — — 39,502

Total $532,749 $42,599 $(17,354) $557,994

Held to Maturity

Obligations of states and political subdivisions $ 15,231 $ 235 $ (3) $ 15,463Corporate securities 1,999 65 — 2,064

Total $ 17,230 $ 300 $ (3) $ 17,527

S&T 40

S&T 41

There were $7,086,000, $5,833,000 and $11,881,000 in gross

realized gains and $3,826,000, $2,593,000 and $1,159,000

in gross realized losses in 2000, 1999 and 1998, respectively,

relative to securities available for sale.

The amortized cost and estimated market value of debt

securities at December 31, 2000, by contractual maturity,

are shown below. Expected maturities will differ from

contractual maturities because borrowers may have the

right to call or prepay obligations with or without call or

prepayment penalties.

At December 31, 2000 and 1999, securities with principal

amounts of $321,549,000 and $317,979,000, respectively,

were pledged to secure repurchase agreements and public

and trust fund deposits.

For purposes of the maturity table, mortgage-backed

securities, which are not due at a single maturity date, have

been allocated over maturity groupings based on the

weighted-average contractual maturities of the underlying

collateral. The mortgage-backed securities may mature

earlier than their weighted-average contractual maturities

because of principal prepayments.

N O T E E

Loans

The following table indicates the composition of

the loan portfolio at December 31:2000 1999


Real estate—construction $ 113,856 $ 94,786 Real estate—mortgages:

Residential 465,779 466,881 Commercial 589,028 527,970

Commercial and industrial 347,285 302,877 Consumer installment 89,076 103,763

Gross Loans $1,605,024 $1,496,277Allowance for loan losses (27,395) (27,134)

Net Loans $1,577,629 $1,469,143

Amortized MarketAvailable for Sale Cost Value


Due in one year or less $ 12,516 $ 12,566 Due after one year through five years 247,101 248,884 Due after five years through 10 years 152,831 154,348

Total $ 412,448 $ 415,798

Amortized MarketHeld to Maturity Cost Value

Due in one year or less $ 4,090 $ 4,107Due after one year through five years 9,422 9,596

Total $ 13,512 $ 13,703

The Bank has granted loans to certain officers and

directors of S&T as well as certain affiliates of the officers

and directors in the ordinary course of business. These loans

were made on substantially the same terms, including

interest rates and collateral, as those prevailing at the time

for comparable transactions with unrelated persons and

did not involve more than normal risk of collectibility.

The aggregate dollar amounts of these loans were

$42,182,000 and $43,478,000 at December 31, 2000 and

1999, respectively. During 2000, $70,010,000 of new loans

were funded and repayments totaled $71,306,000.

The principal balances of loans on nonaccrual were

$2,897,000 and $2,987,000 at December 31, 2000 and 1999,

respectively. At December 31, 2000, there were no commit-

ments to lend additional funds on nonaccrual loans. Other

real estate owned, which is included in other assets, was

$548,000 at December 31, 2000 and $291,000 at December

31, 1999.

The following table represents S&T’s investment in

loans considered to be impaired and related information on

those impaired loans:

The following table presents changes in the allowance

for loan losses for the year ended December 31:

2000 1999 1998


Balance at beginning of year $ 27,134 $ 26,677 $ 20,427 Charge-offs (9,000) (7,002) (5,999)Recoveries 5,261 3,459 1,699

Net charge-offs (3,739) (3,543) (4,300)Provision for loan losses 4,000 4,000 10,550

Balance at end of year $ 27,395 $ 27,134 $ 26,677

2000 1999 1998


Recorded investment in loans considered to be impaired $ 8,142,000 $11,602,000 $3,391,000 Loans considered to be impaired that were on a

nonaccrual basis 915,000 — —Allowance for loan losses related to loans considered

to be impaired — 73,000 133,000 Average recorded investment in impaired loans 12,580,000 5,948,000 2,927,000 Total interest income per contractual terms on

impaired loans 1,665,000 1,271,000 674,000 Interest income on impaired loans recognized

on a cash basis 1,507,000 1,107,000 605,000

S&T 42

S&T 43

The aggregate of all time deposits over $100,000

amounted to $123,299,000 and $85,649,000 for December

31, 2000 and 1999, respectively.

Certain banking facilities and equipment are leased

under short-term lease arrangements expiring at various

dates to the year 2010. All such leases are accounted for as

operating leases. Rental expense for premises and equip-

ment amounted to $1,513,000, $1,266,000 and $1,497,000

in 2000, 1999 and 1998, respectively. Minimum annual

rentals for each of the years 2001–2005 are approximately

$659,000, $375,000, $374,000, $369,000 and $344,000,

respectively, and $500,000 for the years thereafter. Included

in the above are leases entered into with two directors for

which rental expense totaled $340,041, $397,751 and

$338,921 in 2000, 1999 and 1998, respectively.

N O T E G

Deposits

The following table indicates the composition of deposits

at December 31:2000 1999


Noninterest-bearing demand $ 232,625 $ 219,202 Interest-bearing demand 123,371 120,211 Money market 308,401 295,258 Savings 144,589 159,797 Time deposits 716,346 640,597

Total $1,525,332 $1,435,065

N O T E F

Premises and Equipment

The following table is a summary of the premises and

equipment accounts at December 31:2000 1999


Land $ 3,084 $ 3,048 Premises 19,212 18,705 Furniture and equipment 16,221 15,006 Leasehold improvements 3,049 3,015

41,566 39,774Accumulated depreciation (21,176) (19,096)

Total $ 20,390 $ 20,678

N O T E H

Long-Term Borrowings

The following table is a summary of long-term borrowings

with the Federal Home Loan Bank (FHLB):

The following table indicates the scheduled maturities

of time deposits at December 31: 2000 1999


Due in one year $356,708 $329,870 Due in one to two years 243,601 122,773 Due in two to three years 74,683 123,762 Due in three to four years 16,780 34,099 Due in four to five years 16,312 19,230 Due after five years 8,262 10,863

Total $716,346 $640,597

2000 1999

Balance Average Rate Balance Average Rate


Due in one year $ 55,000 5.90% $ 19,600 5.93%Due in one to two years 40,000 6.27 55,000 5.90Due in two to three years 61,000 5.98 40,000 6.27Due in three to four years 51,500 6.18 86,000 5.75Due in four to five years — — 51,500 6.18Due after five years 58,118 4.96 33,118 5.35

Total $265,618 5.82% $285,218 5.89%

The purpose of these borrowings was to match-fund

selected new loan originations, to mitigate interest rate

sensitivity risks and to take advantage of discounted

borrowing rates through the FHLB for community

investment projects.

S&T pledged all 1–4 family and multi-family mortgage

loans as collateral for any current or future FHLB borrow-

ings. The total carrying amount of these pledged loans was

$400,183,000 at December 31, 2000.

At December 31, 2000 and 1999, S&T had long-term

repurchase agreement borrowings totaling $112,379,000

and $78,844,000, respectively, at a weighted average fixed

rate of 6.50% and 5.58%, respectively, which mature in one

to four years. The purpose of these borrowings was to lock

in fixed-rate fundings to mitigate interest rate risk.

S&T 44

S&T 45

Certain restrictions exist regarding the ability of S&T Bank

to transfer funds to S&T in the form of dividends and

loans. Dividends that may be paid by S&T Bank to S&T

are limited to the retained earnings of S&T Bank which

amounted to $121,501,000 at December 31, 2000. The

amount of dividends that may be paid to S&T is further

restricted by regulatory guidelines concerning minimum

capital requirements.

S&T, in the normal course of business, is subject to various

legal proceedings in which claims for monetary damages

are asserted. No material losses are anticipated by

management as a result of these legal proceedings.

N O T E J

Dividend and Loan Restrictions

N O T E K

Litigation

Federal law prohibits S&T from borrowing from S&T

Bank unless such loans are collateralized by specific

obligations. Further, such loans are limited to 10% of S&T

Bank’s capital and additional paid-in capital, as defined.

At December 31, 2000, the maximum amount available for

transfer from S&T Bank to S&T in the form of loans and

dividends approximated 46% of consolidated equity.

2000 1999


Average balance during the year $104,521 $142,852 Average interest rate during the year 5.75% 4.72%Maximum month-end balance during the year $168,244 $212,361 Average interest rate at year-end 5.89% 5.06%

Federal funds purchased and securities sold under repurchase

agreements (REPOS) generally mature within one to 14

days from the transaction date. S&T defines REPOS with

its retail customers as retail REPOS, and wholesale REPOS

N O T E I

Short-Term Debt

are those transacted with other financial institutions.

Information concerning federal funds purchased and

REPOS is summarized as follows:

The provision for income taxes differs from the amount

computed by applying the statutory federal income tax rate

to income before income taxes. The statutory to effective

tax rate reconciliation for the years ended December 31

is as follows:

Income taxes applicable to security gains were $1,141,000

in 2000, $1,134,000 in 1999 and $3,753,000 in 1998.

N O T E M

Income Taxes

Income tax expense (credits) for the year ended

December 31 are comprised of:2000 1999 1998


Current $17,518 $16,749 $17,006 Deferred 48 1,228 (807)

Total $17,566 $17,977 $16,199

2000 1999 1998


Statutory tax rate 35% 35% 35%Tax-exempt interest income

and dividend exclusion (5) (3) (3)Low income housing tax credits (2) (2) (2)

Effective tax rate 28% 30% 30%

S&T, in the normal course of business, commits to extend

credit and issues standby letters of credit. The obligations

are not recorded in S&T’s financial statements. Loan

commitments and standby letters of credit are subject to

S&T’s normal credit underwriting policies and procedures

and generally require collateral based upon management’s

evaluation of each customer’s financial condition and

ability to satisfy completely the terms of the agreement.

S&T’s exposure to credit loss in the event the customer

does not satisfy the terms of the agreement equals

the notional amount of the obligation less the value

of any collateral. Unfunded loan commitments totaled

$450,391,000 and $440,400,000 at December 31, 2000

and 1999, respectively; and obligations under standby

letters of credit totaled $174,874,000 and $140,642,000

at December 31, 2000 and 1999, respectively.

S&T attempts to limit its exposure to concentrations

of credit risk by diversifying its loan portfolio. S&T defines

concentrations of credit risk as loans to a specific industry

or group in excess of 10% of total loans. S&T has no concen-

tration of credit risk by industry or group, except for apartment

rentals that comprise 12% of total loans. Geographic

concentrations exist because S&T provides a full range

of banking services including commercial, consumer

and mortgage loans to individuals and corporate customers

in its seven-county market area in western Pennsylvania.

Management believes these risks are mitigated by under-

writing guidelines and ongoing review by loan administration.

N O T E L

Financial Instruments and Credit Risk

S&T 46

S&T 47

The Bank maintains a defined benefit pension plan cover-

ing substantially all employees. The benefits are based on

years of service and the employee’s compensation during

the last ten years of employment. Contributions are

intended to provide for benefits attributed to employee

service to date and for those benefits expected to be earned

in the future. Trustee pension plan assets consist primarily

of equity and fixed income securities and short-term

investments.

The following table summarizes the components of net

periodic pension expense for the Bank’s defined benefit plan:

2000 1999 1998


Service cost—benefits earned during the period $ 1,035 $ 1,121 $ 1,068 Interest cost on projected benefit obligation 1,702 1,604 1,489 Expected return on plan assets (2,747) (2,556) (2,070)Net amortization and deferral (191) (35) (14)

Net periodic pension (income) expense $ (201) $ 134 $ 473

Significant components of S&T’s temporary

differences were as follows at December 31:2000 1999


Deferred tax liabilities:Net unrealized holding gains

on securities available for sale $(17,501) $ (8,836)Fixed assets (573) (621)Accretion on acquired loans (92) (326)Prepaid pension (119) (119)Prepaid hospitalization (181) (102)Market-to-market adjustments (2,437) (2,307)Point recognition (2,127) (1,872)

Total deferred tax liabilities (23,030) (14,183)

Deferred tax assets:Allowance for loan losses 9,378 9,287 Loan fees 687 627 Interest expense on increasing rate CDs — 17 Deferred compensation 888 850 Goodwill 233 273 Other 57 55

Total deferred tax assets 11,243 11,109

Net deferred tax liability $(11,787) $ (3,074)

N O T E N

Employee Benefits

The following table sets forth the plan’s funded status

and the accrued pension cost in the consolidated balance

sheets at December 31:

The following tables summarize the activity in the

benefit obligation and plan assets:

2000 1999


Benefit obligation at beginning of year $ (24,742) $ (25,000)Fair value of plan assets at end of year 29,956 31,043

Funded status 5,214 6,043 Unrecognized net gain (4,667) (5,683)Unamortized prior service cost 63 70 Balance of initial unrecognized net asset (7) (29)

Prepaid pension cost included in other assets $ 603 $ 401

2000 1999


C H A N G E I N B E N E F I T O B L I G AT I O N

Benefit obligation at beginning of year $ 25,000 $ 25,171 Service cost 1,035 1,121 Interest cost 1,702 1,604 Plan participants’ contributions 70 43 Actuarial gain (1,927) (1,884)Benefits paid (1,138) (1,055)

Benefit obligation at end of year $ 24,742 $ 25,000

C H A N G E I N P L A N A S S E T S

Fair value of plan assets at beginning of year $ 31,043 $ 28,897 Actual return on plan assets (19) 3,158 Employer contributions — —Plan participants’ contributions 70 43 Benefits paid (1,138) (1,055)

Fair value of plan assets at end of year $ 29,956 $ 31,043

Below are actuarial assumptions used in accounting

for the plan:2000 1999 1998

Weighted-average discount rate 7.5% 7.0% 6.5%Rate of increase in future compensation levels 5.0 5.0 5.0Expected long-term rate of return on plan assets 9.0 9.0 8.0

S&T 48

S&T 49

2000 1999 1998

Weighted Weighted WeightedAverage Average Average

Number Option Number Option Number Optionof Shares Price of Shares Price of Shares Price

Outstanding at beginning of year 1,435,372 $20.41 1,280,572 $19.08 1,457,822 $14.21Granted 384,700 19.81 315,800 22.88 334,800 27.75Exercised (10,950) 12.79 (157,400) 14.64 (510,250) 10.90Forfeited (9,000) 24.22 (3,600) 27.75 (1,800) 20.38

Outstanding at end of year 1,800,122 $20.31 1,435,372 $20.41 1,280,572 $19.08

Exercisable at end of year 1,415,422 $20.45 1,119,572 $19.72 945,772 $16.01

S&T also has a supplemental retirement plan (SERP) for

certain key employees. The SERP is unfunded. The balances

of the actuarial present values of projected benefit obliga-

tions related to the SERP are $2,331,000 and $2,136,000 at

December 31, 2000 and 1999, respectively. Accrued pension

costs related to the SERP were $2,196,000 and $2,114,000

at December 31, 2000 and 1999, respectively. Net periodic

pension cost related to the SERP was $263,000, $224,000 and

$244,000 at December 31, 2000, 1999 and 1998, respectively.

The actuarial assumptions are the same as those used in

the previous tables.

S&T adopted an Incentive Stock Plan in 1992 (Stock Plan)

that provides for granting incentive stock options,

nonstatutory stock options and stock appreciation rights

(SARs). On October 17, 1994, the Stock Plan was amended

to include outside directors. The Stock Plan covers a

maximum of 3,200,000 shares of S&T common stock and

expires ten years from the date of board approval. At

December 31, 2000, 2,572,122 nonstatutory stock options

had been granted under the stock plan.

Each year S&T has granted nonstatutory stock options

at exercise prices equal to the fair market value of S&T

common stock on the grant date.

Stock options granted under the Stock Plan are not

exercisable before a six-month vesting period or after ten

years from the date of grant. There were no SARs issued or

outstanding at December 31, 2000 and 1999. The following

table summarizes the changes in the nonstatutory stock

options outstanding during 2000, 1999 and 1998:

The Bank maintains a Thrift Plan (Plan) in which

substantially all employees are eligible to participate.

The Bank makes matching contributions to the Plan up to

3% of participants’ eligible compensation and may make

additional profit-sharing contributions as limited by the Plan.

Contributions to the Plan have been cash or unallocated

Employee Stock Ownership Plan (ESOP) shares. Expense

related to these contributions amounted to $1,390,000,

$1,328,000 and $813,000 in 2000, 1999 and 1998, respec-

tively. At December 31, 2000 and 1999, the ESOP had no

unallocated shares.

N O T E O

Incentive Stock Plan and Dividend Reinvestment Plan

Options are granted in December and have a six-month

vesting period and a ten-year contractual life.

S&T accounts for stock options in accordance with

APB 25. The following proforma information regarding net

income and earnings per share assumes the adoption of

Statement No. 123 for stock options granted subsequent to

December 31, 1994. The estimated fair value of the options

is amortized to expense over the vesting period.

The Black-Scholes option valuation model was devel-

oped for use in estimating the fair value of traded options

which have no vesting restrictions and are fully transfer-

able. In addition, option valuation models require the input

of highly subjective assumptions including the expected

stock price volatility. Because S&T’s employee stock

options have characteristics significantly different from

those of traded options, and because changes in the

subjective input assumptions can materially affect the fair

value estimate, in management’s opinion, the existing

models do not necessarily provide a reliable single measure

of the fair value of its employee stock options.

S&T also sponsors a dividend reinvestment plan

(Dividend Plan) whereby shareholders may purchase

shares of S&T common stock at market value with rein-

vested dividends and voluntary cash contributions.

American Stock Transfer and Trust Company, the plan

administrator and transfer agent, purchases the shares on

the open market to fulfill the Dividend Plan’s needs.

The fair value was estimated at the date of grant using a

Black-Scholes option pricing model with the following

weighted-average assumptions for 2000, 1999 and 1998,

respectively: risk-free interest rates of 5.17%, 6.19% and

4.45%; a dividend yield of 4.4%, 3.5% and 2.7%; volatility

factors of the expected market price of S&T’s common stock

of .265, .270 and .226; and a weighted-average expected life

of five years.

2000 1999 1998

Contractual Contractual ContractualShares Exercise Remaining Shares Exercise Remaining Shares Exercise Remaining

Outstanding Price Life (Years) Outstanding Price Life (Years) Outstanding Price Life (Years)

1994 83,000 $ 9.50 4 84,400 $ 9.50 5 121,650 $ 9.50 61995 171,300 13.13 5 180,650 13.13 6 214,200 13.13 71996 192,500 15.44 6 192,500 15.44 7 254,500 15.44 81997 329,422 20.38 7 331,422 20.38 8 355,422 20.38 91998 327,200 27.75 8 330,600 27.75 9 334,800 27.75 101999 312,000 22.88 9 315,800 22.88 10 — — —2000 384,700 19.81 10 — — — — — —

Total 1,800,122 $20.31 7.7 1,435,372 $20.41 8.1 1,280,572 $19.08 8.4

2000 1999 1998

(dollars in thousands except per share data)

Proforma net income $44,163 $40,182 $37,030Proforma earnings per share—Basic 1.64 1.48 1.33Proforma earnings per share—Diluted 1.63 1.47 1.32

The following table summarizes the range of exercise

prices at December 31:

S&T 50

S&T 51

Statements of Income for the year ended December 31:

2000 1999 1998


Dividends from bank subsidiary $ 22,666 $ 20,565 $ 18,253 Investment income 59 60 84

Income before equity in undistributed netincome of subsidiaries 22,725 20,625 18,337

Equity in undistributed net income of:Bank subsidiary 14,911 13,517 9,919 Nonbank subsidiary 7,337 7,276 9,707

Net Income $ 44,973 $ 41,418 $ 37,963

N O T E P

S&T Bancorp, Inc. (parent company only)

Condensed Financial Information

Balance Sheets at December 31:2000 1999


A S S E T S

Cash $ 17 $ 23 Investments in:

Bank subsidiary 173,669 146,496 Nonbank subsidiary 106,128 95,389

Total Assets $279,814 $241,908


Dividends payable $ 5,929 $ 5,396Other liabilities (3,212) (3,188)

Total Liabilities 2,717 2,208

Total Shareholders' Equity 277,097 239,700

Total Liabilities and Shareholders’ Equity $279,814 $241,908

S&T is subject to various regulatory capital requirements

administered by the federal banking agencies. Failure to

meet the minimum capital requirements can initiate certain

mandatory and possibly additional discretionary actions by

regulators that, if undertaken, could have a direct material

effect on S&T’s financial statements. Under capital guide-

lines and the regulatory framework for prompt corrective

action, S&T must meet specific capital guidelines that

involve quantitative measures of S&T’s assets, liabilities

and certain off-balance-sheet items as calculated under

N O T E Q

Regulatory Matters

regulatory accounting practices. S&T’s capital amounts and

classification are also subject to qualitative judgements by

the regulators about components, risk weightings and

other factors.

Quantitative measures established by regulation to

ensure capital adequacy require S&T to maintain minimum

amounts and ratios of Tier I and Total capital to risk-

weighted assets and of Tier I capital to average assets.

As of December 31, 2000 and 1999, S&T meets all capital

adequacy requirements to which it is subject.

Statements of Cash Flows for the year ended December 31:2000 1999 1998


O P E R AT I N G A C T I V I T I E S

Net Income $ 44,973 $ 41,418 $ 37,963 Equity in undistributed net income of subsidiaries (23,170) (22,208) (21,069)Change in other assets/liabilities (23) (526) (2,662)

Total Provided by Operating Activities 21,780 18,684 14,232

I N V E S T I N G A C T I V I T I E S

Distributions from bank subsidiary 1,349 18,320 23,431

Total Provided in Investing Activities 1,349 18,320 23,431

F I N A N C I N G A C T I V I T I E S

Dividends (22,134) (20,149) (17,515)Acquisition of treasury stock (1,001) (17,241) (19,758)

Total Used in Financing Activities (23,135) (37,390) (37,273)

(Decrease) increase in Cash (6) (386) 390 Cash at Beginning of Year 23 409 19

Cash at End of Year $ 17 $ 23 $ 409

S&T 52

S&T 53

The most recent notification from the Federal Deposit

Insurance Corporation categorized S&T Bank as well

capitalized under the regulatory framework for corrective

action. At December 31, 2000, S&T Bank’s Tier I and Total

capital ratios were 9.11% and 10.37%, respectively, and

Tier I capital to average assets was 7.64%. At December 31,

1999, S&T Bank’s Tier I and Total capital ratios were 9.03%

and 10.29%, respectively, and Tier I capital to average assets

was 7.08%.

To be classified as well capitalized, S&T must maintain

minimum Tier I risk-based, Total risk-based and Tier I

leverage ratios as set forth in the table below:To Be Well

For Capital Capitalized Under Adequacy Prompt Corrective

Actual Purposes Action Provisions

Amount Ratio Amount Ratio Amount Ratio


As of December 31, 2000:Total Capital $284,265 14.61% $155,666 8.00% $194,582 10.00%(to Risk Weighted Assets)Tier 1 Capital 238,911 12.28 77,833 4.00 116,749 6.00(to Risk Weighted Assets)Tier 1 Capital 238,911 10.41 91,806 4.00 114,757 5.00(to Average Assets)

As of December 31, 1999:Total Capital $255,385 14.59 $140,057 8.00 $175,071 10.00(to Risk Weighted Assets)Tier 1 Capital 217,194 12.41 70,028 4.00 105,043 6.00(to Risk Weighted Assets)Tier 1 Capital 217,194 9.90 87,785 4.00 109,731 5.00(to Average Assets)

Shareholders and Board of Directors

S&T Bancorp, Inc.

We have audited the accompanying consolidated balance

sheets of S&T Bancorp, Inc. and subsidiaries (S&T) as of

December 31, 2000 and 1999, and the related consolidated

statements of income, changes in shareholders’ equity,

and cash flows for each of the three years in the period

ended December 31, 2000. These financial statements are

the responsibility of S&T’s management. Our responsibility

is to express an opinion on these financial statements based

on our audits.

We conducted our audits in accordance with auditing

standards generally accepted in the United States. Those

standards require that we plan and perform the audit to

obtain reasonable assurance about whether the financial

statements are free of material misstatement. An audit

includes examining, on a test basis, evidence supporting

the amounts and disclosures in the financial statements.

An audit also includes assessing the accounting principles

used and significant estimates made by management, as

well as evaluating the overall financial statement presentation.

We believe that our audits provide a reasonable basis for

our opinion.

In our opinion, the financial statements referred to

above present fairly, in all material respects, the consoli-

dated financial position of S&T Bancorp, Inc. and

subsidiaries at December 31, 2000 and 1999 and the

consolidated results of their operations and their cash flows

for each of the three years in the period ended December

31, 2000, in conformity with accounting principles generally

accepted in the United States.

Pittsburgh, Pennsylvania

January 12, 2001

R E P O R T O F E R N S T & Y O U N G L L P, I N D E P E N D E N T A U D I T O R S


S&T 54

S&T 55

S T O C K P R I C E S A N D D I V I D E N D I N F O R M AT I O N

S&T Bancorp, Inc.’s common stock is listed on the Nasdaq

National Market System (Nasdaq). The range of sales

prices for the years 2000 and 1999 are as follows and are

based upon information obtained from Nasdaq. As of the

close of business January 31, 2001, there were 3,165 share-

holders of record of S&T Bancorp, Inc. Dividends paid by

S&T are provided from the Bank’s dividends to S&T. In

addition, the payment of dividends by the Bank to S&T is

subject to the restrictions described in Note K to the

Consolidated Financial Statements. The cash dividends

declared shown below represent the historical per share

amounts for S&T Bancorp, Inc. common stock.

S T O C K P R I C E S A N D D I V I D E N D I N F O R M A T I O N

S E L E C T E D F I N A N C I A L I N F O R M A T I O N


Price Range of Common Stock

2000 Low High Cash Dividends Declared

Fourth Quarter $ 17.38 $ 22.94 $ 0.22 Third Quarter 17.75 20.00 0.21 Second Quarter 16.75 18.75 0.21 First Quarter 17.13 23.44 0.20

1999

Fourth Quarter $ 21.63 $ 24.63 $ 0.20 Third Quarter 21.94 26.00 0.19 Second Quarter 20.88 26.88 0.19 First Quarter 19.00 29.00 0.18

S E L E C T E D F I N A N C I A L I N F O R M A T I O N

Year Ended December 31: 2000 1999 1998 1997 1996


I N C O M E S TAT E M E N T S

Interest income $176,184 $156,727 $151,438 $141,101 $132,442Interest expense 86,141 69,942 69,156 62,284 58,589 Provision for loan losses 4,000 4,000 10,550 5,000 5,175

Net interest income afterprovision for loan losses 86,043 82,785 71,732 73,817 68,678

Noninterest income 22,154 20,100 24,418 16,441 11,997 Noninterest expense 45,658 43,490 41,988 43,198 42,398

Income before income taxes 62,539 59,395 54,162 47,060 38,277Applicable income taxes 17,566 17,977 16,199 13,646 10,036

Net income $ 44,973 $ 41,418 $ 37,963 $ 33,414 $ 28,241

P E R S H A R E D ATA 1

Net income—Basic $ 1.67 $ 1.52 $ 1.37 $ 1.18 $ 1.00 Net income—Diluted 1.66 1.51 1.35 1.17 1.00 Dividends declared 0.84 0.76 0.66 0.56 0.47 Book value 10.28 8.88 9.38 9.20 8.01

1 Per share amounts have been restated to record the effect of a two-for-one common stock split in the form of a 100% stock dividend distributed on October 30, 1998.

S&T 56

S E L E C T E D F I N A N C I A L D A T A

Q U A R T E R LY S E L E C T E D F I N A N C I A L D A T A


S E L E C T E D F I N A N C I A L D A T A

B A L A N C E S H E E T T O T A L S ( P E R I O D E N D ) :

Year Ended December 31: 2000 1999 1998 1997 1996


Total assets $2,310,290 $2,194,073 $2,069,611 $1,920,291 $1,787,045 Securities 580,912 575,224 591,486 568,220 500,061 Net loans 1,577,629 1,469,143 1,339,232 1,253,326 1,181,407 Total deposits 1,525,332 1,435,065 1,380,063 1,284,658 1,270,367 Securities sold under

repurchase agreements 80,686 116,009 138,825 170,124 114,205 Long-term borrowings 377,997 364,062 240,068 144,218 136,618 Total shareholders’ equity 277,097 239,700 259,637 260,118 226,118

Q U A R T E R LY S E L E C T E D F I N A N C I A L D A T A

2000 1999

Fourth Third Second First Fourth Third Second FirstQuarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter


S U M M A R Y O F O P E R AT I O N S

Income Statements:Interest income $ 45,741 $ 45,328 $ 43,216 $ 41,899 $ 41,318 $ 39,829 $ 38,239 $ 37,341 Interest expense 22,790 22,442 21,043 19,866 19,119 17,926 16,636 16,261 Provision for loan losses 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000

Net interest income afterprovision for loan losses 21,951 21,886 21,173 21,033 21,199 20,903 20,603 20,080

Security gains, net 836 961 569 895 397 1,017 407 1,419 Noninterest income 4,867 4,755 4,910 4,361 4,540 4,390 4,074 3,856 Noninterest expense 11,438 11,730 11,178 11,312 10,927 11,234 10,513 10,816

Income before income taxes 16,216 15,872 15,474 14,977 15,209 15,076 14,571 14,539Applicable income taxes 4,586 4,459 4,331 4,190 4,559 4,592 4,422 4,404

Net income $ 11,630 $ 11,413 $ 11,143 $ 10,787 $ 10,650 $ 10,484 $ 10,149 $ 10,135

P E R S H A R E D ATA

Net income—Diluted $ 0.43 $ 0.42 $ 0.41 $ 0.40 $ 0.39 $ 0.38 $ 0.37 $ 0.37 Dividends declared 0.22 0.21 0.21 0.20 0.20 0.19 0.19 0.18 Book value 10.28 9.81 9.19 8.96 8.88 8.96 9.13 9.02

AV E R A G E B A L A N C E S H E E T T O TA L S

Total assets $2,300,826 $2,276,239 $2,239,178 $2,192,311 $2,194,619 $2,148,108 $2,093,615 $2,042,623 Securities 584,086 580,977 569,610 567,311 594,391 602,717 583,256 573,108 Net loans 1,570,290 1,530,552 1,501,081 1,476,447 1,448,496 1,404,516 1,379,703 1,342,657 Total deposits 1,500,831 1,482,129 1,477,065 1,444,314 1,425,049 1,407,878 1,390,027 1,366,708 Securities sold under

repurchase agreements 100,550 80,292 87,269 141,668 112,403 147,688 164,525 129,010 Long-term borrowings 378,579 409,890 390,888 329,681 368,553 297,680 240,068 240,068 Total shareholders’ equity 273,805 260,323 248,510 239,833 248,080 248,000 250,412 257,608

S&T 57

S & T B A N K L O C A T I O N S

N. FOURTH STREET

Linda F. ShafferBranch Sales Manager324 N. Fourth Street

DIRECT BANKING CENTER

Mark W. KromerManager355 N. Fifth Street

INDIAN SPRINGS

Jennifer J. MyersBranch Sales Manager2175 Rt. 286 South

SOUTHTOWNE PLAZA

Diana TrunzoBranch Sales Manager2550 Rt. 286 South

WAYNE AVENUE

Renee LazerationBranch Sales Manager1107 Wayne Avenue

KITTANNING

Lori SpixBranch Sales ManagerHilltop PlazaRt. 268, Kittanning

LUCERNE

Bernadette PalcheskoBranch Sales ManagerRt. 119 S. & Lucerne Road

MONROEVILLE

Donna BenzenhoeferBranch Sales Manager4385 Old William PennHighway

PENN HILLS

Tammy GeibelBranch Sales Manager12262 Frankstown Road

PLUM

James T. End, Jr.Branch Sales Manager7660 Saltsburg Road

HAMPTON AVENUE

Kenneth B. ParsonsBranch Sales Manager232 N. Hampton Avenue

MAHONING

Vicki LowmasterBranch Sales Manager539 W. Mahoning Street

REYNOLDSVILLE

Roberta KlingensmithBranch Sales Manager418 Main Street

SALTSBURG

Darlene D. ShirleyBranch Sales Manager602 Salt Street

SHADYSIDE

S&T Business Banking CenterLynn FritziusRetail Services Specialist820 South Aiken Avenue(412) 802-6000

UNITY

Stacy BurgesonBranch Sales Manager301 Unity Center Road

VANDERGRIFT

Valerie StoneBranch Sales Manager109 Grant Avenue

YOUNGWOOD

Pamela P. PriceBranch Sales Manager100 S. Fourth Street

S&T BROKERAGE SERVICES

645 Philadelphia Street(724) 465-1435

S&T WEALTH

MANAGEMENT GROUP

43 S. Ninth Street(724) 465-1443or 800-446-0246

S&T COMMERCIAL LENDING

800 Philadelphia Street(724) 465-1486

SHAREHOLDER INQUIRIES

43 S. Ninth Street(724) 465-1466

ARMAGH

Robert J. LasinskiBranch Sales Manager133 Philadelphia Street

BLAIRSVILLE

Blairsville StationDonald J. LoPrestiBranch Sales Manager205 E. Market Street

CHESTNUT RIDGE PLAZA

Connie ZackCustomer Service CoordinatorRt. 22 East

BURRELL TOWNSHIP PLAZA

Cynthia L. WilsonBranch Sales ManagerRt. 119, Black Lick

BROCKWAY

Michael Todd MillerBranch Sales Manager456 Main Street

BROOKVILLE

Judith A. GromleyBranch Sales Manager256 Main Street

ROUTE 36Richard O. LondonBranch Sales ManagerRoute 36 & Interstate 80

CLARION

Andrew D. SayersBranch Sales Manager410 Main Street

DELMONT

Jacqueline A. HahnBranch Sales Manager85 Greensburg Street

DERRY

Enid MercinkoBranch Supervisor100 S. Chestnut Street

DUBOIS

DuBois Drive-UpEva McKeeBranch Supervisor35 W. Scribner Avenue

DUBOIS MALL

Cheryl A. JohnsonBranch Sales ManagerShaffer Road

DUBOIS REGIONAL

BANKING CENTER

Laurie ApplemanBranch Sales Manager614 Liberty Boulevard

TREASURE LAKE

Norman H. JohnstonBranch Sales ManagerCoral Reef & Crooked Island Roads

EAST OAKMONT

Sharon DeLucaBranch Sales Manager2190 Hulton Road

GREENSBURG

Judith SolesBranch Sales Manager701 East Pittsburgh Street

WESTMORELAND MALL

Sheri AstonBranch SupervisorRt. 30, Greensburg

HOLIDAY PARK

Michael F. CioccaBranch Sales Manager2388 Rt. 286

HOMER CITY

Michael F. Grimes, Jr.Branch Sales Manager34 N. Main Street

INDIANA

Main OfficeChristine RumbaughBranch Sales Manager800 Philadelphia Street

S&T branch offices may be reached by calling 800-325-BANK or, in Indiana, at (724) 349-1800.

MYLES D. SAMPSON

President,

Rimco Properties, Inc.

JEFFREY D. GRUBE

President,

B.F.G. Electroplating and

Manufacturing Co.

DON H. ERICKSON, JR.

Director Emeritus

SAMUEL LEVY

President,

Jefferson Wholesale Grocery

Company, Inc.

FORREST L. BRUBAKER

Director Emeritus

CHARLES A. SPADAFORA

President,

Colonial Motor Mart

PAUL B. JOHNSTON, D.D.S.

Director Emeritus

ROBERT D. DUGGAN

Chairman,

S&T Bancorp, Inc.

and S&T Bank

JOSEPH A. KIRK

President,

Beaver Meadow

Creamery, Inc.

DONALD J. DENNISON, ESQ.

Director Emeritus

RUTH M. GRANT

President,

Louis A. Grant Company, Inc.

RAYMOND C. BACHELIER

Director Emeritus

WILLIAM G. KEGEL, JR.

Director Emeritus

Left to right:James L. Carino, Thomas A. Brice, Frank W. JonesChristine J. Toretti, William J. Gatti,James C. Miller, John J. Delaney,Alan Papernick,L. Blaine Grube, Herbert L. Hanna, M.D.

2000 BOARD OF DIRECTORS

S&T 58

Left to right:Myles D. Sampson,Jeffrey D. Grube,Don H. Erickson, Jr., Samuel Levy, Forrest L. Brubaker, Charles A. Spadafora, Paul B. Johnston, D.D.S., Robert D. Duggan, Joseph A. Kirk,Donald J. Dennison, Esq,Ruth M. Grant, Raymond C. Bachelier, William G. Kegel, Jr.

JAMES L. CARINO

President,

J.L. Carino Nurseries, Inc.

THOMAS A. BRICE

Vice President,

Douds, Inc.

FRANK W. JONES

Attorney-at-Law

CHRISTINE J. TORETTI

Chairman and Chief Executive

Officer, S.W. Jack Drilling Company,

and Partner, C&N Company

WILLIAM J. GATTI

President and Chief

Executive Officer,

Gatti Medical Supply, Inc.

JAMES C. MILLER

President and Chief Executive

Officer, S&T Bancorp, Inc.

and S&T Bank

JOHN J. DELANEY

President,

Delaney Chevrolet,

Geo, Buick, Honda

ALAN PAPERNICK

Attorney-at-Law

L. BLAINE GRUBE

Director Emeritus

HERBERT L. HANNA, M.D.

Family Practice

W. PARKER RUDDOCK*

*MISSING FROM PHOTO

S&T 59

S&T 60

R E G I O N A L A D V I S O R Y B O A R D S

INDIANA AREA

ADVISORY BOARD

John H. Armstrong, Esq.

Bernard Bruns

Paul D. Burton, M.D.

James Connelly, D.D.S.

William M. Darr

Lynn A. Doverspike

David Grube

W. David Hoff, D.C.

William L. Hughes

Wayne A. Kablack, Esq.

Hastie Kinter

Nathan Kovalchick

Mark Lentz, M.D.

Walter L. Lewis

Christina Lubold, M.D.

Robert S. Marcus, Esq.

Lawrence K. Pettit, Ph.D.

Wallace Putt

Paul Sherry

W. H. Spadafora

Michael R. Stever, D.O.

Vivian Supinka, Esq.

Shafic Y. Twal, M.D.

William A. Vitalie, D.D.S.

Steve Wolfe

SOUTHERN INDIANA

ADVISORY BOARD

Todd D. Andree

Russ Bonarrigo

David Bork, Sr.

Daniel A. David

Randy Davis

James F. Ferguson

Michael A. Huczko

Matthew N. Klain, M.D.

Mike Klapak

Gladys W. Knox

Michael A. LaMantia

Ronald M. Little

Anthony J. Mancuso, M.D.

David J. Maxwell

Joseph V. Serwinski

William T. Shulick, Esq.

Carl J. Valero

Gary W. Wheatley

BROOKVILLE/

PUNXSUTAWNEY

ADVISORY BOARD

Beth Ammerman-Gerg, Esq.

Milissa Bauer

Daniel D. Blough, Jr.

Jack DeMotte

Amy Peace Gigliotti, D.D.S.

Frederick A. Goble

Jeffrey D. Grube

Michael J. Johnston

Paul B. Johnston, D.D.S.

David Kahle

Richard W. Kooman II, Esq.

Ben Levy

Samuel Levy

Jeffery Lundy, Esq.

Becky Matson

Dalph McNeil

Stephen R. Means

Jatin Mehta, D.V.M.

Bradley R. Miller

Richard D. Mowrey

Wendy Nichamin, Esq.

Fred Ochs

Thomas E. Robb, Jr.

Frank Roberts

Keith D. Shields

Jamie C. Stello, Esq.

Frank T. Stockdale

DUBOIS/BROCKWAY/

REYNOLDSVILLE

ADVISORY BOARD

Dan Brownlee

Jane H. Bryndel

Paula Cherry, Esq.

Dan Corbet

Ann K. Cristini

James Devlin, M.D.

Jeffery S. DuBois, Esq.

R. Leo Ferraro

Francis G. Grieneisen

George Heigel

David J. Hopkins, Esq.

Robert W. Keim

Kim E. Mowrey

Robert E. Nelson

Gary A. Peters

Michael J. Piccirillo

Paul K. Rezk

James Scerbo, M.D.

Mary Jo Shaffer

Frank A. Varischetti, Sr.

William H.Young

EAST ALLEGHENY

COUNTY ADVISORY

BOARD

William E. Anderson

Kathy L. Anderson

William T. Ferri

Robert W. Ford

Earl W. Garlow

Louis A. Grant, Jr.

Darryl Hall

Jean L. Harchelroad

John S. Kuruc

Russell P. Miller

Donald R. O’Block

James C. Rumbaugh, Jr.

Mohammad A. Samad

Benard Sampson

Richard J. Schultheis

Robert H. Scott, D.M.D.

George H. Thompson, Esq.

Joseph M.Yates

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