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                   South Jersey Financial Corporation, Inc.



                                August 12, 1999



Committee to Preserve Shareholder Value
c/o  Lawrence B. Seidman, Esq.
100 Misty Lane
Parsippany, New Jersey 07054

Dear Committee:

     The purpose of this letter is to set forth the terms of an agreement
between South Jersey Financial Corporation, Inc. (the "Company") and you and
other members of the South Jersey Financial Corporation, Inc. Committee to
Preserve Shareholder Value (the "Committee") as to the matters set forth herein.
The Committee consists of: Seidman and Associates, L.L.C.; Seidman and
Associates II, L.L.C.; Seidman Investment Partnership, L.P.; Seidman Investment
Partnership II, L.P.; Kerrimatt LP; Federal Holdings L.L.C.; Lawrence B.
Seidman; Benchmark Partners, LP; Richard Whitman; and Lorraine DiPaolo.

     The Company agrees to cease its active solicitation encouraging
shareholders not to vote for Lawrence B. Seidman and Richard Baer.

     In addition, following the 1999 Annual Meeting, the Company will take such
action as may be necessary to add Seidman as a director of South Jersey Savings
and Loan Association (the "Bank") for a term to expire in 2002.

     It is further agreed:

          (i)  That as indicated in the Committee's proxy statement for the 1999
          Annual Meeting, the Committee will vote all of the Company's stock
          owned by the Committee as of the July 9, 1999 record date for the 1999
          Annual Meeting of Stockholders in favor of the election of Gregory M.
          DiPaolo to the Board of Directors of the Company at the 1999 Annual
          Meeting of Shareholders, as well as in favor of Seidman and Baer.

          (ii) The Board of Directors of the Company will propose at a Special
          Meeting of the Company, which shall be held on or about February 13,
          2000, ("Special Meeting") two stock-based compensation plans -- a
          stock option plan and a restricted stock plan ("RRP") (collectively,
          the "Plans"), generally as described in the prospectus for the
          Company's initial public offering. Such Plans will provide for
          accelerated vesting of the benefits allocated under the Plans in the
          event of a control change or retirement. For purposes of this
          paragraph, retirement shall mean ceasing to be a director, employee or
          officer of the Company or the Bank, other than removal for cause. The
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South Jersey Financial Corporation, Inc.
August 12, 1999
Page 2

          Committee will vote all shares of stock of the Company beneficially
          owned by any of them as of the record date for the Special Meeting in
          favor of the Plans. All employees and members of the Board of the
          Company and Bank, including Seidman and Baer, will be permitted to
          participate in the stock option plan; however, participation in the
          RRP will be limited to all employees and all directors of the Company
          and Bank as of the date of this Agreement. Allocations to any one
          officer will be limited to a maximum of 25% of each of the two
          respective plans and director allocations may be made in amounts not
          to exceed 5% per director of each of the respective Plans. The number
          of shares that may be allocated under the RRP shall be determined by
          dividing the lesser of the per share closing price of the Company's
          Common Stock on the date hereof or on the date shareholders approve
          the RRP with and into $1,517,372.

          (iii) Prior to the conduct of the Special Meeting referred to in
          paragraph (ii) above, (provided such meeting is conducted before any
          annual meeting of stockholders held after the 1999 annual meeting
          scheduled to be held on August 18, 1999), the Committee will not
          engage in a solicitation in opposition to management of the Company or
          submit any of their own proposals for stockholder approval without
          prior Board approval. Nothing contained in this paragraph shall be
          interpreted to prohibit Seidman from voting, as a director, in such
          manner as he deems appropriate on any matter which may come before the
          Board of Directors or any committee of the Company or the Bank, nor
          shall the same prohibit him from including in any disclosure by the
          Company under the Securities Exchange Act of 1934, any statement
          explaining his vote if he is required to include such an explanation
          in such disclosure.

          (iv)  The Committee concurs that, subject to whatever fiduciary duties
          may exist as required by the Employee Retirement Income Security Act,
          as amended, unallocated ESOP shares and unallocated RRP shares may be
          voted in accordance with the terms of the plans, which generally
          provide, or will provide, that unallocated shares will be voted pro
          rata in the same percentage as the votes cast by the holders of
          allocated shares who exercise their right to direct the voting of
          allocated shares.

          (v)   The Committee will not take any action indirectly, or induce any
          other person or entity to take any action which, if taken directly by
          the member of the Committee, would be in violation of this Agreement,
          nor will the Committee take any action which would reasonably be
          anticipated to thwart any of the provisions of this Agreement. All the
          members of the Committee individually shall be personally bound by the
          provisions of this Agreement which by their terms are applicable to
          the Committee. The members of the Committee agree not to seek to use
          the press or other public pronouncements to publicly air disputes with
          the Company through and including February 28, 2000.

          (vi)  The Committee acknowledges that all of the members of the
          Committee and anyone acting in concert with or affiliated with any
          member of the Committee are set
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South Jersey Financial Corporation, Inc.
August 12, 1999
Page 3

          forth in the first paragraph of this Agreement.

          (vii)  Seidman hereby agrees and warrants that he has the authority to
          bind all of the members of the Committee, other than those who have
          signed below, to this Agreement and that by his signature below he
          binds himself and all of such other members of the Committee.

          (viii) Robert Colacicco warrants that he has been authorized to enter
          into this agreement by the Board of Directors of the Company.

          (ix)   The Company and each member of its Board of Directors and each
          of the members of the Committee (each, a "Released Party") agree to
          irrevocably and unconditionally release each Released Party from any
          claims any Released Party may have against another Released Party
          arising out of the proxy solicitations that the Company and the
          Committee pursued in connection with the Company's 1999 Annual Meeting
          of Stockholders.

                                   Very truly yours,

                                   South Jersey Financial Corporation, Inc.


                                   By: /s/ Robert J. Colacicco
                                       -------------------------------------
                                       Robert J. Colacicco
                                       President and Chief Executive Officer


Lawrence B. Seidman, personally and as agent
for the persons and entities who are members of
the Committee as named in paragraph 1 of this
Agreement, other than those for whom separate
signatures are provided below.


/s/ Richard Whitman
--------------------------
Richard Whitman, personally and on
behalf of Benchmark Partners, LP

/s/ Lorraine Di Paolo
--------------------------
Lorraine Di Paolo