Center Bancorp, Inc. Announces Outsourcing Partnerships With Compushare, Inc. and PHH Mortgage to Reduce Operating Overhead in 2008

Market Wire, March, 2008

Center Bancorp, Inc. (NASDAQ: CNBC), parent company of Union Center National Bank, today announced the Corporation had signed two strategic outsourcing agreements to aid in the realization of its goal to reduce operating overhead and shrink the infrastructure of the Corporation. The cost reduction plans are expected to significantly improve operating efficiencies, business and technical operations.

A key component of the plan is an Information Technology (IT) infrastructure and business process outsourcing initiative to migrate certain service, development and support functions -- including IT infrastructure services, application support and maintenance, transactional services and support services to Orange County, California-based financial technology management company, Compushare, Inc.

The strategic outsourcing agreement has been hailed by a strategic technical expert at Compushare as a smart move by Union Center in times of increasing margin compression and economic uncertainty for the nation. Union Center sought a trusted, national, and financially stable technology provider to assist in security, compliance, risk management, systems integration, technology support and management efforts for the financial institution and Compushare was the clear choice.

"It's never an easy decision to change a set way of doing business, especially when a reduction to headcount is a necessary factor to take into consideration. Union Center has recognized the need to evolve with the changing landscape of the industry and we strongly believe the outsourcing agreement will streamline operations and enable continued success for the bank," said Romir Bosu, President and Chief Executive Officer of Compushare, Inc.

Compushare is the nation's leading provider of outsourced technology and compliance services for community financial institutions. Through the newly formed relationship, Union Center now has direct access to the team of nationally recognized technology and compliance experts and services that Compushare offers in areas of managed technology services, risk management programs and strategic technology development.

In a separate action the Corporation announced it is partnering with PHH Mortgage, a subsidiary of PHH Corporation (NYSE: PHH) as a strategic outsourcing partner for its mortgage loan origination and servicing business. PHH Mortgage will provide end-to-end mortgage solutions that seamlessly promote the Union Center brand in all customer communications.

PHH Mortgage will provide the Bank with a multi channel origination platform, integrated loan processing, branded loan servicing, and certain secondary marketing functions. The alliance allows the Bank loan officers to use Web-based software while PHH employees will do the entire loan processing, underwriting and closing in the name of Union Center. The PHH Mortgage platform will also allow the Bank to expand its origination channels, making mortgages more convenient for its customers. The Bank will use PHH Mortgage's inbound call center and fully private labeled internet origination site.

"It has become apparent that outsourcing key components of our service platforms and internal structure to third party professional organizations was the right thing to do from a timing, technical and financial perspective. The Corporation briefly considered continuing to support itself internally but has realized through an intensive review both with outside consultants and senior management that it continues to be too expensive, time consuming and distracts our resources from our core competency: providing high quality commercial banking services. This realization led us to incorporate this into our strategic plan for fiscal 2008 and we reviewed a number of local providers that could offer a high level of service, security, contingency, compliance risk, as well as state of the art customer platforms," indicated Anthony C. Weagley, President & CEO.

Both of these arrangements will allow the Company to offer competitive products and services without the internal costs of maintaining its own platforms and effectively allowing the Corporation to leverage its banking franchise.

Expense reductions generated by the plan are expected to be realized in 2008, with a moderate benefit to operating expenses during the second half of 2008, due primarily to the timing of implementation in the first half of 2008 coupled with one time charges that it expects it will incur as a result of severance payments to affected employees in the second quarter of 2008. The company expects to reduce the workforce by employees who will be eliminated or reassigned, while others will be eligible to apply for other open positions within the Corporation.

These actions are part of our overall restructuring which includes our recent branch consolidations, and our new telecommunications partnership with Atlantic Central Bankers Bank's "BITS" program and our implementation of remote branch capture technology which will also contribute to reduce operating expenses during 2008.