March 8, 2007

FOR IMMEDIATE RELEASE FOR FURTHER INFORMATION

Bethlehem, Pa. Contact Joseph T. Svetik, President

610-691-2233

FIRST STAR BANCORP ANNOUNCES DIVIDEND DECLARATION AND PLANNED

STOCK PURCHASES BY EMPLOYEE STOCK OWNERSHIP PLAN

Bethlehem, PA, March 8, 2007. First Star Bancorp, Inc. (the “Company”) announced today that the Company’s board of directors has declared a cash dividend of $.05 per share on the Company’s outstanding common stock. The cash dividend will be payable on April 9, 2007 to stockholders of record on March 19, 2007.

The Company also announced today that it expects to lend approximately $300,000 to the First Star Savings Bank Employee Stock Ownership Plan Trust (the “ESOP Trust”) during the fiscal year ending June 30, 2007. The ESOP Trust will use those funds, together with contributions that First Star Savings Bank makes to the ESOP, to purchase common stock of the Company in open market transactions from time to time, subject to market conditions.

The Company reported net income for the three months ended December 31, 2006 of $1,378,000, or $1.33 per diluted share, compared to $471,000, or $0.49 per diluted share, for the three months ended December 31, 2005. The increase is partly attributable to a recovery of a defaulted security. Net income for the six months ended December 31, 2006 was $2,060,000, or $2.02 per diluted share, compared to $1,231,000, or $1.23 per diluted share, for the six months ended December 31, 2005. The Company had total assets of $571.61 million at December 31, 2006.

First Star Bancorp, Inc. is the holding company for First Star Savings Bank which serves the Lehigh Valley through its main office in Bethlehem and branch offices in Alburtis, Allentown, Bath, Nazareth, Palmer Township and Wind Gap. Deposits at First Star Savings Bank are insured up to the legal maximum (generally, $100,000 per depositor) by the Federal Deposit Insurance Corporation (FDIC).

This news release may contain forward-looking statements, which can be identified by the use of words such as “believes,” “expects,” “anticipates,” “estimates” or similar expressions. Such forward-looking statements and all other statements that are not historic facts are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors. These factors include, but are not limited to, general economic conditions, changes in the interest rate environment, legislative or regulatory changes that may adversely affect our business, changes in accounting policies and practices, changes in competition and demand for financial services, adverse changes in the securities markets, changes in deposit flows and changes in the quality or composition of the Company’s loan or investment portfolios. Should one or more of these risks materialize, actual results may vary from those anticipated, estimated or projected. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except as may be required by applicable law or regulation, the Company assumes no obligation to update any forward-looking statements.

FIRST STAR BANCORP, INC.

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)

(Dollars in thousands, except per share data)

Selected Financial Data:

	At December 31, 2006	At December 31, 2005
Total assets..................................................	$571,614	$583,352
Cash and cash equivalents.............................	5,892	5,743
Investment securities.....................................	127,636	114,390
Mortgage-backed securities ..........................	186,509	211,209
Loans receivable, net....................................	233,717	230,410
Deposits.......................................................	363,490	319,468
Borrowings...................................................	165,615	227,594
Stockholder’s equity......................................	36,694	31,820
Non-performing loans....................................	3,436	559
Non-performing assets..................................	$ 0	$ 258

Selected Operations Data:

	Three Months Ended December 31,			Six Months Ended December 31,
	2006	2005		2006	2005
Interest and dividend income..........................................	$8,569		$7,111	$16,791		$14,521
Interest expense .................	5,920		5,037	11,868		9,936
Net interest income........	2,649		2,074	4,923		4,585
Provision for loan losses......	156		65	221		65
Net interest income after provision for loan losses...	2,493		2,009	4,702		4,520
Other income......................	1,054		184	1,275		252
Other expense....................	1,527		1,540	2,983		3,038
Income before taxes...........	2,020		653	2,994		1,734
Provision for income taxes..	642		182	934		503
Net Income...................	1,378		471	2,060		1,231
Earnings per share basic	$2.32		$0.78	$3.46		$2.06
Earnings per share diluted	$1.33		$0.49	$2.02		$1.23