RADNOR, Pa., March 29 /PRNewswire/ -- The following statement
was issued today by the law firm of Barroway Topaz Kessler Meltzer
& Check, LLP:
Notice is hereby given that a class action lawsuit was filed in
the United States District Court for the Eastern District of
New York on behalf of purchasers
of Smithtown Bancorp, Inc. (Nasdaq: SMTB) ("SBI" or the "Company")
between March 13, 2008 and
February 1, 2010 inclusive (the
"Class Period"), including purchasers of the securities issued
pursuant or traceable to the Company's public offering on or about
May 14, 2009.
If you wish to discuss this action or have any questions
concerning this notice or your rights or interests with respect to
these matters, please contact Barroway Topaz Kessler Meltzer &
Check, LLP (Darren J. Check, Esq. or
David M. Promisloff, Esq.) toll free
at 1-888-299-7706 or 1-610-667-7706, or via e-mail at
info@btkmc.com.
The Complaint charges SBI and certain of its officers and
directors with violations of the Securities Act of 1933 and
Securities Exchange Act of 1934. SBI is the holding company of Bank
of Smithtown, which bills itself
as the largest independent commercial bank headquartered on
Long Island. More
specifically, the Complaint alleges that the Company failed to
disclose and misrepresented the following material adverse facts
which were known to defendants or recklessly disregarded by them:
(1) that SBI had materially understated its loan loss
reserves; (2) that SBI had failed to state certain of its assets at
their fair value; (3) that the Company had delayed recognition of
impaired assets; (4) that the Company's financial statements were
not prepared in accordance with Generally Accepted Accounting
Principles; (5) that the Company lacked adequate internal and
financial controls; (6) that, as a result of the foregoing, the
Company's financial statements were materially false and misleading
at all relevant times; (7) that the Company, through its
subsidiary, was engaged in unsafe and/or unsound banking practices;
and (8) that as a result, the Company lacked any reasonable basis
for positive statements regarding the Company, its growth and/or
its prospects.
Beginning on November 2, 2009, the
truth about the Company began to be revealed. On that date,
the Company announced that its 2009 third quarter earnings were
reduced by a provision of $10 million
to its loan loss reserves. Upon the release of this news, shares of
the Company's stock declined $1.44
per share, or 13.91 percent, to close on November 2, 2009 at $8.91 per share, on heavy trading volume.
Then, on February 1, 2010, the
Company announced dismal results for the fourth quarter of 2009.
This included a quarterly loss of $19.8 million (and net loss for the year of
$11.8 million), due to a provision of
$38 million to the Company's loan
loss reserves and a write-down of $7
million to another real estate owned property.
Additionally, the Company shocked investors when it announced
that its subsidiary, Bank of Smithtown, had entered into a Consent
Agreement with the Federal Deposit Insurance Corporation and a
parallel Consent Order with the New York
State Banking Department (the Consent Agreement and Consent
Order are collectively referred to as the "Consent Agreement").
Under the Consent Agreement, the bank was required to improve
credit administration, loan underwriting, internal loan review
process, and maintain an adequate allowance for loan losses.
Further, the bank was required to implement plans to reduce
classified assets, decrease the bank's concentration in commercial
real estate loans, and increase its profitability. On this news,
SBI's stock fell $0.81 per share, or
14.97 percent, to close on February 1,
2010 at $4.60 per share, on
heavy trading volume. SBI's stock has not recovered by an
appreciable extent since that time.
Plaintiff seeks to recover damages on behalf of class members
and is represented by the law firm of Barroway Topaz Kessler
Meltzer & Check which prosecutes class actions in both state
and federal courts throughout the country. Barroway Topaz
Kessler Meltzer & Check is a driving force behind corporate
governance reform, and has recovered billions of dollars on behalf
of institutional and individual investors from the United States and around the world.
For more information about Barroway Topaz Kessler Meltzer &
Check, or for additional information about participating in this
action, please visit www.btkmc.com.
If you are a member of the class described above, you may, not
later than April 26, 2010, move the
Court to serve as lead plaintiff of the class, if you so choose.
A lead plaintiff is a representative party that acts on
behalf of other class members in directing the litigation. In
order to be appointed lead plaintiff, the Court must determine that
the class member's claim is typical of the claims of other class
members, and that the class member will adequately represent the
class. Your ability to share in any recovery is not, however,
affected by the decision whether or not to serve as a lead
plaintiff. Any member of the purported class may move the
court to serve as lead plaintiff through counsel of their choice,
or may choose to do nothing and remain an absent class member.
CONTACT:
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Barroway Topaz
Kessler Meltzer & Check, LLP
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Darren J. Check,
Esq.
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David M. Promisloff,
Esq.
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280 King of Prussia
Road
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Radnor, PA
19087
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1-888-299-7706 (toll
free) or 1-610-667-7706
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Or by e-mail at
info@btkmc.com
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SOURCE Barroway Topaz Kessler Meltzer & Check, LLP