For
                Immediate ReleaseDate:
                October 26, 2006Contact:
                Mary Beth Steiginga,Assistant
                Secretary630
                Godwin AvenueMidland
                Park, NJ 07432201-
                444-7100








**PRESS
      RELEASE**





**Stewardship
      Financial Corporation Announces**


**Record
      Earnings for the Third Quarter, 2006, Announces Forming a New Relationship
      with
      Elan Financial Services and Disposes of Certain Assets**





Midland
      Park, NJ - October 26, 2006- Stewardship Financial Corporation (OTC:SSFN) (the
      “Corporation”), parent of Atlantic Stewardship Bank, announced today net income
      for the three (3) months ended September 30, 2006 of $1.23 million or $0.24
      basic earnings per share, an increase of 5.7% and 4.3% respectively, as compared
      to net income of $1.16 million, or $0.23 basic earnings per share for the same
      three (3) month period in 2005. Fully diluted earnings per share were $0.24
      for
      the three (3) months ended September 30, 2006 as compared to $0.23 for the
      three
      (3) months ended September 30, 2005.





For
      the
      nine (9) months ended September 30, 2006, Stewardship Financial Corporation
      reported net income of $3.50 million or $0.70 basic earnings per share, an
      increase of 6.0% and 6.1% respectively, as compared to net income of $3.30
      million or $0.66 basic earnings per share for the same nine (9) month period
      in
      2005. Diluted earnings per share were $0.69 for the nine (9) months ended
      September 30, 2006, an increase of 4.5% over the diluted earnings per share
      of
      $0.66 for the nine (9) months ended September 30, 2005.


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Per
      share
      calculations have been adjusted for a 5% stock dividend paid in November 2005,
      a
      4-for-3 stock split effective on July 1, 2005 and a 5% stock dividend payable
      on
      November 15, 2006.





Stewardship
      Financial Corporation’s President and Chief Executive Officer Paul Van
      Ostenbridge stated, “We are pleased to report a record earnings increase for the
      period ending September 30, 2006. Although the flat yield curve and competitive
      deposit interest rate environment continue to contribute to pressure on net
      interest margin, our earnings remain strong. We are also proud to report that
      we
      have surpassed the milestone of $500 million in total assets.”





Stewardship
      Financial Corporation’s total assets reached $509.1 million at September 30,
      2006, compared to $473.6 million at September 30, 2005, resulting in growth
      of
      7.5%. Total loans increased 12.5% to $366.1 million at September 30, 2006,
      compared to $325.6 million at September 30, 2005. Total deposits were $426.7
      million at September 30, 2006, compared to $409.6 million a year ago, resulting
      in growth of 4.2%. Total stockholders’ equity increased 9.9% to $36.6 million at
      September 30, 2006, compared to $33.3 million a year ago.





Stewardship
      Financial Corporation also announced that its wholly owned subsidiary, Atlantic
      Stewardship Bank (the “Bank”) has entered into an agreement with Elan Financial
      Services (“Elan”), a national credit card issuer. Under this agreement, Elan has
      agreed to purchase the Bank’s existing credit card portfolio, and subsequently
      will issue


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credit
      cards for the Bank under the name of Atlantic Stewardship Bank. It is
      anticipated that the settlement of the sale will occur in late October 2006
      or
      early November 2006.





As
      of
      September 30, 2006, the Bank held approximately $3.5 million in credit card
      receivables. Although the estimate is preliminary in nature and may be subject
      to adjustment following the closing of the transaction, the Corporation
      anticipates that it will recognize a gain for the fourth quarter of 2006, net
      of
      income taxes, of approximately $400,000 to $500,000 as a result of the sale
      to
      Elan. In addition, the Bank will continue to earn certain fees from ongoing
      portfolio activity.





In
      discussing the execution of the agreement with Elan, Mr. Van Ostenbridge stated,
      “We are always looking for opportunities which will provide our customers with
      the best in products and services. Elan is a leader in the credit card payment
      and services industry and will be able to provide our customers with a choice
      selection of credit card products, complimented by superior customer
      service.”





The
      Corporation also announced that it sold $17.3 million of available for sale
      securities that were yielding less than 5 percent, resulting in an after-tax
      charge of approximately $380,000.  The
      proceeds were used to purchase higher yielding securities and to fund loan
      growth. The Corporation anticipates that the transaction will reduce exposure
      to
      future interest rate risk and enhance long-term financial performance.





Stewardship
      Financial Corporation’s subsidiary, the Atlantic Stewardship Bank, has banking
      offices in Midland Park, Hawthorne (2), Montville, Pequannock, Ridgewood,






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Waldwick,
      and Wayne (3), New Jersey. The 11 th branch
      is expected to open in Wyckoff, New Jersey during the first quarter of 2007.
      The
      bank is known for tithing 10% of its pre-tax profits to Christian and local
      charities. We invite you to visit our website at www.asbnow.com for additional
      information.




*This
      information disclosed in this document contains certain “forward looking
      statements” within the meaning of the Private Securities Litigation Reform Act
      of 1995, and may be identified by the use of such words as “believe,” “expect,”
“anticipate,” “should,” “plan,” “estimate,” and “potential.” Examples of forward
      looking statements include, but are not limited to, estimates with respect
      to
      the financial condition, results of operation, gain on the sale of the Bank’s
      credit card portfolio, the results of the sale of other assets and business
      of
      the Corporation that are subject to various factors which could cause actual
      results to differ materially from these estimates. These factors include:
      changes in general, economic and market conditions, legislative and regulatory
      conditions, the final determination, calculation and review of expected results
      and the imposition of possible accounting adjustments thereto, or the
      development of an interest rate environment that adversely affects the
      Corporation’s interest rate spread or other income anticipated from operations
      and investments.*








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**Stewardship
                  Financial Corporation****Financial
                  Highlights****(unaudited)**(In
                  thousands, except per share data)


**Nine
                  Months Ended**
              
              
              
              **Three
                  Months Ended****September
                  30,**
              
              
              
              **September
                  30,****2006**
              
              **2005**
              
              
              
              **2006**
              
              **2005****Selected
                  Operating Data:**Total
                  interest income
              
              $
              22,111
              
              $
              18,176
              
              
              
              
              $
              7,793
              
              $
              6,461Total
                  interest expense
              
              
              7,807
              
              
              4,681
              
              
              
              
              
              2,928
              
              
              1,847Net
                  interest income before provisionfor
                  loan loss
              
              
              14,304
              
              
              13,495
              
              
              
              
              
              4,865
              
              
              4,614Provision
                  for loan loss
              
              
              250
              
              
              450
              
              
              
              
              
              90
              
              
              150Net
                  interest income after provisionfor
                  loan loss
              
              
              14,054
              
              
              13,045
              
              
              
              
              
              4,775
              
              
              4,464(Losses)
                  gains on sales of securities
              
              
              -
              
              
              -
              
              
              
              
              
              -
              
              
              -Other
                  noninterest income
              
              
              2,885
              
              
              2,399
              
              
              
              
              
              983
              
              
              8542,885
              
              
              2,399
              
              
              
              
              
              983
              
              
              854Noninterest
                  expense
              
              
              11,509
              
              
              10,318
              
              
              
              
              
              3,868
              
              
              3,552Income
                  before income tax expense
              
              
              5,430
              
              
              5,126
              
              
              
              
              
              1,890
              
              
              1,766Income
                  tax expense
              
              
              1,929
              
              
              1,824
              
              
              
              
              
              665
              
              
              607Net
                  income
              
              $
              3,501
              
              $
              3,302
              
              
              
              
              $
              1,225
              
              $
              1,159Basic
                  earnings per share
              
              $
              0.70
              
              $
              0.66
              
              
              
              
              $
              0.24
              
              $
              0.23Diluted
                  earnings per share
              
              $
              0.69
              
              $
              0.66
              
              
              
              
              $
              0.24
              
              $
              0.23


**At
                    September
                    30,******
                
                **2006**
                ****
                **2005****Selected
                    Financial Data:**Total
                    assets
                
                
                $
                509,130
                
                $
                473,593Total
                    loans, net of deferred loan fees
                
                
                
                366,098
                
                
                325,557Allowance
                    for loan losses
                
                
                
                4,086
                
                
                4,714Total
                    deposits
                
                
                
                426,749
                
                
                409,598Stockholders'
                    equity
                
                
                
                36,600
                
                
                33,312
  **At
                    or for the nine month period****ended
                    September
                    30,****2006**
                
                **2005****Selected
                    Financial Ratios:**Annualized
                    return on average assets (ROA)
                
                
                
                
                
                0.96
                %
                
                
                1.00
                %Annualized
                    return on average equity (ROE)
                
                
                
                
                
                13.41
                %
                
                
                13.83
                %Tier
                    1 equity to total assets
                
                
                
                
                
                8.56
                %
                
                
                8.51
                %Book
                    value per share
                
                
                
                
                $
                7.29
                
                
                $
                6.65
  All
                    share data has been restated to include the effect of a 5% stock
                    dividend
                    paid in November, 2005, a 4 for 3stock
                    split issued July 1, 2005 and a 5% dividend payable November
                    15,
                    2006.