SAVB The Savannah Bancorp, Inc. (MM)

The Savannah Bancorp, Inc. (NASDAQ: SAVB) announced today that it has received conditional approval from the Office of Thrift Supervision (OTS), the Federal Reserve Bank of Atlanta and the Federal Deposit Insurance Corporation to form Harbourside Community Bank (Harbourside) as a wholly owned subsidiary of the Company. Harbourside will be a federal stock savings bank headquartered on Hilton Head Island, South Carolina. The Company has organized Harbourside in partnership with a group of directors from Hilton Head Island and Bluffton, South Carolina. Completion of construction of the main office building at 852 William Hilton Parkway, Hilton Head Island, SC, satisfaction of the standard charter approval conditions and opening of the bank are expected in early February, 2006. The Company established a loan production office on Hilton Head Island in September, 2003 known as Harbourside Mortgage Company which has operated as a division of The Savannah Bank, the Company's lead banking subsidiary. In August 2005, the Company completed the sale of 397,273 shares of common stock in a private placement for net proceeds of $11.6 million. $10 million of the proceeds will be used to capitalize Harbourside. Upon issuance of the new charter by OTS, the operations of Harbourside Mortgage Company will be transferred to Harbourside Community Bank.