AMENDMENT NO. 1 TO SPLIT-DOLLAR AGREEMENT

This Amendment No. 1, dated as of November 19, 2008 (this “Amendment”), amends the Split-Dollar Agreement between Prudential Savings Bank (formerly known as “Prudential Savings Bank, PaSA”), a Pennsylvania-chartered stock savings bank (the “Company”), and Joseph W. Packer, Jr. (the “Director”) dated June 22, 1994 (the “Agreement”).

WHEREAS, Section 7 of the Agreement permits either party, with the consent of the other party, to terminate the Agreement by giving written notice of termination to the other party;

WHEREAS, upon any termination of the Agreement, the Director has the right to purchase the policy from the Company and to thereafter obtain the cash surrender value of the policy;

WHEREAS, as a result of the Director’s right to obtain the cash surrender value of the policy upon a termination of the Agreement, the Agreement does not satisfy the exemption for death benefit only plans under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”);

WHEREAS, the parties desire to amend the Agreement in order to grandfather the Agreement for purposes of Section 409A of the Code, with the amount of the grandfathered cash surrender value to be determined in accordance with the “proportional allocation method” set forth in Notice 2007-34 issued by the Internal Revenue Service (the “IRS”);

WHEREAS, the Agreement is currently deemed to be grandfathered under Treasury Regulation §1.61-22, which grandfathering treatment under the split dollar regulations would normally be lost in the event of a material modification of the Agreement;

WHEREAS, Part III.D.2 of IRS Notice 2007-34 expressly states that a modification of a split-dollar life insurance arrangement necessary to avoid the application of Section 409A of the Code will not be treated as a material modification of the arrangement for purposes of Treasury Regulation §1.61-22(j);

WHEREAS, this Amendment satisfies the requirements in Part III.D.2 of IRS Notice 2007-34 for having the Agreement no longer be subject to Section 409A of the Code, and the Amendment does not materially enhance the value of the benefits to the Director under the Agreement;

WHEREAS, Section 10 of the Agreement permits the parties to amend the Agreement by a written instrument signed by each of the parties and attached to the Agreement; and

WHEREAS, the parties do not expect or intend to make any material modifications to the Agreement which would result in the grandfathering treatment being lost under either Treasury Regulation §1.61-22 or Section 409A of the Code;

NOW, THEREFORE, in consideration of the mutual agreements herein set forth and such other consideration the sufficiency of which is hereby acknowledged, the parties hereby amend the Agreement as follows:

1.   Amendment to Section 6 of the Agreement .  Section 6 of the Agreement is hereby amended to read in its entirety as follows:

“6.           DISPOSITION OF POLICY PROCEEDS.  Notwithstanding any beneficiary designation made on the policy, the Company shall be entitled to the following amounts from the policy:

(a)           Death of Director and Spouse – At the death of both the Director and his spouse, the Company shall be entitled to an amount equal to the sum of (i) the Aggreg