Royal Bank America Parent Co. Announces 2nd Quarter Earnings and Decision to Temporarily Forego Dividend

NARBERTH, PA--(Marketwire - July 18, 2008) - Royal Bancshares of Pennsylvania, Inc. ("Royal") (NASDAQ: RBPAA), the holding company for Royal Bank America and Royal Asian Bank, announced earnings for the second quarter of 2008.

Net income for the three months ended June 30, 2008 was $152,000 (after adding an additional $4.5 million pre-tax to its provision for loan losses for the quarter) or $0.01 basic and diluted earnings per share, compared to net income of $4.0 million or $0.29 basic and diluted earnings per share for the same period in 2007. Net income for the six months ended June 30, 2008 was $1.2 million, as compared to $6.3 million for the same period in 2007. Net interest margin YTD improved to 3.31% at June 30, 2008 as compared to 2.97% at June 30, 2007. Consolidated total assets ended June 30, 2008 were $1.2 billion, compared to $1.3 billion at June 30, 2007.

In response to current economic trends, the Board of Directors has elected to temporarily forego the quarterly cash dividend.

Comments from Robert R. Tabas, Chairman, Royal Bancshares of Pennsylvania:

"The Board of Directors' decision to temporarily forego paying a cash dividend was an extremely difficult one. We understand the importance of dividends to our shareholders; however, this action was deemed necessary to strengthen our balance sheet and maintain our company's reserves to weather this downturn."

"Royal is unique in that along with myself, our directors and senior management hold a significant interest in the Company's outstanding common stock. This has proven beneficial throughout our history in that the goals of the management team and our shareholders are intrinsically linked."

"Our emphasis continues to be on fostering long-term shareholder value, a significant facet of which is the swift reinstatement of our cash dividend, which will occur as soon as earnings improve and prudent practice allows."

Comments from Joseph P. Campbell, President/CEO, Royal Bancshares of Pennsylvania, Inc. and Royal Bank America:

"We continue to maintain a very strong capital position that exceeds regulatory minimums to be considered 'well-capitalized,' the highest such designation."

"For the 6th consecutive quarter our loan activity has increased, and though we remain cautiously optimistic about the state of the economy, we are actively pursuing opportunities to finance quality projects in our immediate region and beyond."

About Royal Bancshares of Pennsylvania, Inc.

Royal Bancshares of Pennsylvania, Inc., headquartered in Narberth, Pennsylvania, is a two-bank holding company operating the Royal Bank America and Royal Asian Bank brands at 22 unique branch locations throughout Pennsylvania, New Jersey and New York. As The Region's Premier Commercial Real Estate Lender, Royal Bank America has played a lead role in the growth and development of our area for the past 40+ years. Royal Asian Bank enjoys a distinctive niche serving the financing and banking needs of the growing Asian-American population. Additional subsidiaries include RBA Leasing, engaged in equipment leasing solutions for small and mid-sized businesses, and RBA Capital, a lender finance company. More information on Royal Bancshares of Pennsylvania, our banks and subsidiaries is available at www.royalbankamerica.com.

Some of the information in this document may contain projections or other forward-looking statements regarding future events or the future financial performance of Royal Bancshares of Pennsylvania, Inc. and its divisions/subsidiaries ("Royal"). We wish to caution you that these statements are only predictions and that actual events or results may differ materially. For a list of factors which could affect Royal's operating results, see Royal's filings with the Securities and Exchange Commission, including "Item 1A. Risk Factors," set forth in Royal's Annual Report on Form 10-K for the fiscal year ended December 31, 2007.

Contact Information: Contact: Marc Sanders 610-668-4700 x1269