STURGIS, Mich., April 13 /PRNewswire-FirstCall/ -- Sturgis Bancorp Inc. (OTC:STBI) (BULLETIN BOARD: STBI) , holding company for Sturgis Bank & Trust Company, announced that the Company will not participate in the U.S. Treasury's Capital Purchase Program (CPP). On March 05, 2009 the Company was notified it received preliminary approval for participation in this program. Under the approval the U.S. Treasury would have purchased $7.2 million of preferred stock with a dividend rate of 5.00%. In addition the U.S. Treasury would have been granted an additional $360,000 in preferred shares with a dividend rate of 9.00%. This approval was subject to the Company executing agreements with the U.S. Treasury. Eric L. Eishen, President/CEO of Sturgis Bancorp Inc., stated, "We were pleased the U.S. Treasury granted this preliminary approval of our application to participate in this program. This program was designed to help healthy U.S. Banks form capital during these challenging capital market conditions. At the time this program was introduced, we believed it had great potential for helping our economy recover. We filed an application to participate for this reason. Unfortunately, the press has labeled this program as a bank "bail-out" and public sentiment is very negative related to any governmental investments. We are concerned that participation could damage our reputation as a strong financial service provider. Participation required the Company to sign agreements with the U.S. Treasury that would allow the terms and conditions of participation to change on an on-going basis. The agreement is one sided and grants Congress the ability to modify the conditions of the agreement at any time. These ever-changing conditions are of great concern. There are numerous requirements that have already been added to the program since inception. Management believes the additional requirements already imposed, as well as the uncertainty of additional requirements, may be detrimental to the long-term success of the Company. The Bank was profitable in 2008 and our capital levels exceed Regulatory requirements. Bank Management has reviewed asset quality and projected financial performance for 2009. Based on this review, the Board of Directors feels confident we have sufficient resources to meet our capital needs." This release contains statements that constitute forward-looking statements. These statements appear in several places in this release and include statements regarding intent, belief, outlook, objectives, efforts, estimates or expectations of Bancorp, primarily with respect to future events and the future financial performance of the Bancorp. Any such forward-looking statements are not guarantees of future events or performance and involve risks and uncertainties, and actual results may differ materially from those in the forward-looking statement. Factors that could cause a difference between an ultimate actual outcome and a preceding forward-looking statement include, but are not limited to, changes in interest rates and interest rate relationships; demand for products and services; the degree of competition by traditional and non-traditional competitors; changes in banking laws and regulations; changes in tax laws; changes in prices, levies, and assessments; the impact of technological advances; government and regulatory policy changes; the outcome of any pending and future litigation and contingencies; trends in consumer behavior and ability to repay loans; and changes of the world, national and local economies. Bancorp undertakes no obligation to update, amend or clarify forward-looking statements as a result of new information, future events, or otherwise. The numbers presented herein are unaudited. For additional information, visit our website at http://www.sturgisbank.com/ . DATASOURCE: Sturgis Bancorp Inc. CONTACT: Eric Eishen, President & CEO, or Brian P. Hoggatt, CFO, both of Sturgis Bancorp Inc., +1-269-651-9345 Web site: http://www.sturgisbank.com/

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