USBK USA Bank NY (CE)

USA Bank (OTCBB: USBK), a community bank serving the banking and financial services needs of its local customers, has entered into a stock purchase agreement with Westchester Working Group LLC ("WWG") that would provide the Bank with a minimum of $15 million of additional capital through the issuance of new Series A Convertible Preferred stock at a price of $100 per share.

WWG is a single purpose investment vehicle formed specifically to recapitalize USA Bank. WWG is comprised of a group of successful business leaders with established track records in building small businesses into larger successful businesses. WWG believes that with the proper amount of capital, a reconstituted Board of Directors, the restructuring of senior management and the introduction of several new conservative and sustainable revenue streams, USA Bank will be able to achieve and surpass its original community banking pledge, and as a result would realize significant upside growth potential.

As part of the agreement, USA Bank and WWG have agreed to allow USA Bank's existing shareholders and others to purchase and participate in the recapitalization through a public offering at the same valuation as the lead investor (WWG). The Public Offering will be on the same terms and conditions as the sale to WWG to raise an additional $2 to $8 million. WWG has also agreed to purchase additional shares of Preferred Stock to assure that the gross proceeds from the sale of the Preferred Stock to WWG and in the public offering will not be less than $15 million. If all the Preferred Stock is sold the Bank will receive gross proceeds of $23 million to augment its capital.

At the option of the holder, the Preferred Stock will be convertible into Common Stock of the Bank at an initial conversion price equal to $100 divided by $0.325, subject to adjustment if certain events occur. Annual dividends would be payable on the Preferred Stock to each holder in additional shares of Preferred Stock in an amount equal to 6.961038% of the Preferred Stock held by such holder at the record date for the dividend. The shares of Preferred Stock would automatically convert into shares of Common Stock on the fifth anniversary of the date of issuance at the conversion price then in effect.

Fred A. DeCaro III, Chairman of USA Bank said, "The effects of the recession have impacted consumers and businesses alike, including our bank customers. Although USA Bank undertook and established stringent loan criteria, we were not immune to the impact of the recession. With economic weakness and the heightened regulatory awareness in the U.S. remaining a challenge, we believe the investment by WWG will provide us the ability to emerge financially sound and profitable as the economy improves."

He continued, "We are very pleased with the investment that Westchester Working Group has committed to the Bank. The new capital will provide us with the ability to continue to service our customers as well as to introduce a number of new conservative revenue streams that we anticipate will be significantly profitable to the Bank. The capital infusion will also immediately return the Bank to 'well-capitalized status' based upon regulatory requirements. We are also enthusiastic that our existing shareholders will be able to participate in the offering at the same price and on the same terms as WWG is purchasing its shares, and therefore will be able to participate in the anticipated growth of the Bank on an equal basis to the lead investor."

USA Bank expects that the capital infusion from Westchester Working Group and the offering will enable the Bank to grow on a number fronts. As part of the plan, the Bank expects, with regulatory approvals, to open additional branches in new markets as well as introduce several new services to increase its customer base in addition to servicing its loyal customers.

The Bank also anticipates enhancing its operations with additional lines of business. USA Bank is currently in negotiations with a large automotive group to service its automobile loans, and is also completing all the requirements to become a lender and originator to service FHA/VA (Federal Housing Administration/Veterans Administration) loans. The Bank also expects to introduce an SBA (Small Business Loan) program that will target the deployment of $10 million during 2010, $15 million during 2011 and $20 million in 2012 of Small Business Loans. The availability of the new capital combined with the Bank's program to return non-earning assets to earning assets will strengthen the Bank.

As published in the FDIC Call Report for the period ended December 31, 2009, USA Bank had $222.8 million of total assets, $166.9 million of total loans, $192.3 of total deposits and $6.6 million in total equity. Non-performing loans were $63.3 million. Final numbers for the period are subject to change with the completion of the year-end audit.

Mr. DeCaro concluded, "Our management team continues its efforts in working out the non-performing loans. With an improvement in the economic environment, we are confident that we can substantially reduce our non-performing assets in the coming months. The Bank intends to continue to resolve all our delinquent, impaired and nonaccrual loans, and we now have a number of people working on collection as well as loan modifications. The additional capital will provide us with the strength we need to aggressively continue our collection and asset recovery efforts."

About USA Bank USA Bank (www.usa-bank-online.com) provides personal, customized and responsive service in the delivery of banking services to businesses and individuals. It offers traditional commercial banking deposit services to residents in Port Chester, Rye, and Rye Brook, New York. USA Bank is organized under the laws of the State of New York and is regulated by the FDIC and the New York State Banking Department.

"Safe Harbor" Statement under Private Securities Litigation Reform Act of 1995 Some of the statements contained in this press release may include forward-looking statements which reflect our current views with respect to future events and financial performance. Statements which include the words "expect," "intend," "plan," "believe," "project," "anticipate" and similar statements of future or forward-looking nature identify forward-looking statements for purposes of the federal securities laws or otherwise. All forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in these statements or that could adversely affect the holders of our common stock.

These factors include, but are not limited to, those outlined in the Bank's Annual Report on Form 10-K for the year ended December 31, 2008, which was filed with the Federal Deposit Insurance Corporation and is publicly available from the FDIC's Accounting and Securities Disclosure Section, 550 17th Street, N.W., Washington, D.C. 20429 and on the Bank's website at www.usa-bank-online.com.

USA Bank: Fred DeCaro III Chairman 914-417-3210 Investor Relations: Porter, LeVay & Rose, Inc. Michael J. Porter President 212-564-4700