Century Bancorp, Inc. Announces Increased Year-to-Date Earnings for 2013, Up 11%; Asset Growth of 6.

Century Bancorp, Inc. Announces Increased Year-to-Date Earnings for 2013, Up 11%; Asset Growth of 6.5% to Record Size of $3.3 BB; Regular Dividend Declared

MEDFORD, Mass.--(BUSINESS WIRE)-- Century Bancorp, Inc. (NAS: CNBKA) (www.centurybank.com) ("the Company") today announced net income of $9,502,000 for the six months ended June 30, 2013, or $1.71 per Class A share diluted, an increase of 10.8% compared to net income of $8,579,000, or $1.55 per Class A share diluted, for the same period a year ago. Total assets increased 6.5% from $3.1 billion at December 31, 2012 to $3.3 billion at June 30, 2013. For the quarter ended June 30, 2013, net income totaled $5,026,000, or $0.90 per Class A share diluted, an increase of 5.3% compared to net income of $4,771,000, or $0.86 per Class A share diluted, for the same period a year ago.

Net interest income totaled $29.1 million for the six months ended June 30, 2013 compared to $29.8 million for the same period in 2012. The 2.5% decrease in net interest income for the period is primarily due to $640,000 of prepayment penalties collected during the first six months of 2012. The net interest margin decreased from 2.50% on a fully taxable equivalent basis in 2012 to 2.21% on the same basis for 2013. This was primarily the result of a decrease in asset yields. Also, interest expense decreased primarily as a result of the continued decline in market rates and there was a 12.3% increase in the average balances of earning assets, combined with a similar increase in average deposits.


The provision for loan losses decreased by $500,000 from $2.0 million for the six months ended June 30, 2012 to $1.5 million for the six months ended June 30, 2013, primarily as a result of a lower level of charge-off activity. The Company capitalized on favorable market conditions for the first six months ended June 30, 2013 and realized net gains on sales of investments of $1.7 million, as compared to $590,000 for the same period in 2012. The Company's effective tax rate decreased from 6.2% in 2012 to 5.8% in 2013 primarily as a result of an increase in tax-exempt income.

At June 30, 2013, total equity was $166.2 million compared to $180.0 million at December 31, 2012. The Company's equity decreased primarily as a result of an increase in other comprehensive loss, net of taxes, and dividends paid, offset somewhat by earnings. Other comprehensive loss, net of taxes, increased as a result of an increase in unrealized losses on securities available-for-sale. Unrealized losses on the available-for-sale portfolio increased as a result of increases in interest rates. The Company's leverage ratio stood at 6.74% at June 30, 2013, compared to 6.80% at December 31, 2012. The decrease in the leverage ratio is due to an increase in assets. Book value as of June 30, 2013 was $29.92 per share compared to $32.40 at December 31, 2012.

The Company's allowance for loan losses was $20.5 million or 1.76% of loans outstanding at June 30, 2013, compared to $19.2 million or 1.73% of loans outstanding at December 31, 2012 and $18.0 million or 1.75% of loans outstanding at June 30, 2012. The increase in the allowance for loan losses was due to the increase in the size and composition of the loan portfolio as well as qualitative factors. Non-performing assets totaled $3.3 million at June 30, 2013, compared to $4.5 million at December 31, 2012 and $5.3 million at June 30, 2012.

The Company's Board of Directors voted a regular quarterly dividend of 12.00 cents ($0.12) per share on the Company's Class A common stock, and 6.00 cents ($0.06) per share on the Company's Class B common stock. The dividends were declared payable August 15, 2013 to stockholders of record on August 1, 2013.

The Company, through its subsidiary bank, Century Bank and Trust Company, a state chartered full service commercial bank, operating twenty-five full-service branches in the Greater Boston area, offers a full range of Business, Personal and Institutional Services.

Century Bank and Trust Company is a member of the FDIC and is an Equal Housing Lender.

This press release contains certain "forward-looking statements" with respect to the financial condition, results of operations and business of the Company. Actual results may differ from those contemplated by these statements. The Company wishes to caution readers not to place undue reliance on any forward-looking statements. The Company disclaims any intent or obligation to update publicly any such forward-looking statements, whether in response to new information, future events or otherwise.

Century Bancorp, Inc. and Subsidiaries

Consolidated Comparative Statements of Condition (unaudited)

(in thousands)

June 30,

December 31,

Assets

2013

2012

Cash and Due From Banks

$

49,192

$

53,646

Federal Funds Sold and Interest-bearing Deposits In Other Banks

122,713

98,637

Short-term Investments

19,611

17,367

Securities Available-For-Sale (AFS)

1,552,216

1,434,801

Securities Held-to-Maturity

267,613

275,507

Federal Home Loan Bank of Boston stock, at cost

16,082

15,146

Loans:

Commercial & Industrial

101,918

88,475

Construction & Land Development

34,919

38,618

Commercial Real Estate

609,462

576,465

Residential Real Estate

283,392

281,857

Consumer and Other

8,123

7,450

Home Equity

125,918

118,923

Total Loans

1,163,732

1,111,788

Less: Allowance for Loan Losses

20,500

19,197

Net Loans

1,143,232

1,092,591

Bank Premises and Equipment

23,367

23,899

Accrued Interest Receivable

6,005

5,811

Goodwill

2,714

2,714

Other Assets

83,191

66,090

Total Assets

$

3,285,936

$

3,086,209

Liabilities

Demand Deposits

$

440,120

$

438,429

Interest Bearing Deposits:

Savings and NOW Deposits

964,923

933,316

Money Market Accounts

769,660

653,345

Time Deposits

466,492

419,983

Total Interest Bearing Deposits

2,201,075

2,006,644

Total Deposits

2,641,195

2,445,073

Borrowed Funds:

Securities Sold Under Agreements to Repurchase

214,290

191,390

Other Borrowed Funds

177,144

195,144

Total Borrowed Funds

391,434

386,534

Other Liabilities

50,991

38,529

Subordinated Debentures

36,083

36,083

Total Liabilities

3,119,703

2,906,219

Total Stockholders' Equity

166,233

179,990

Total Liabilities & Stockholders' Equity

$

3,285,936

$

3,086,209

Century Bancorp, Inc. and Subsidiaries

Consolidated Comparative Statements of Income (unaudited)

For the Quarter and Six months ended June 30, 2013 and 2012

(in thousands)

Quarter ended June 30,

Six months ended June 30,

2013

2012

2013

2012

Interest Income:

Loans

$

11,997

$

12,572

$

23,878

$

24,620

Securities Held-to-Maturity

1,419

1,924

2,939

3,387

Securities Available-for-Sale

5,571

5,668

11,188

11,383

Federal Funds Sold and Interest-bearing Deposits In Other Banks

145

148

264

287

Total Interest Income

19,132

20,312

38,269

39,677

Interest Expense:

Savings and NOW Deposits

649

560

1,259

1,087

Money Market Accounts

582

618

1,114

1,230

Time Deposits

1,234

1,600

2,568

3,281

Securities Sold Under Agreements to Repurchase

89

88

179

180

Other Borrowed Funds and Subordinated Debentures

2,066

2,057

4,092

4,108

Total Interest Expense

4,620

4,923

9,212

9,886

Net Interest Income

14,512

15,389

29,057

29,791

Provision For Loan Losses

750

900

1,500

2,000

Net Interest Income After

Provision for Loan Losses

13,762

14,489

27,557

27,791

Other Operating Income

Service Charges on Deposit Accounts

2,034

1,922

3,976

3,910

Lockbox Fees

838

781

1,610

1,480

Net Gain on Sales of Investments

781

442

1,664

590

Other Income

1,568

843

2,405

1,627

Total Other Operating Income

5,221

3,988

9,655

7,607

Operating Expenses

Salaries and Employee Benefits

8,382

8,191

17,000

16,332

Occupancy

1,193

1,176

2,475

2,298

Equipment

610

544

1,192

1,127

FDIC Assessment

450

445

850

852

Other

3,027

3,095

5,610

5,642

Total Operating Expenses

13,662

13,451

27,127

26,251

Income Before Income Taxes

5,321

5,026

10,085

9,147

Income Tax Expense

295

255

583

568

Net Income

$

5,026

$

4,771

$

9,502

$

8,579

Century Bancorp, Inc. and Subsidiaries

Consolidated Year-to-Date Average Comparative Statements of Condition (unaudited)

(in thousands)

June 30,

June 30,

Assets

2013

2012

Cash and Due From Banks

$

57,758

$

52,885

Federal Funds Sold and Interest-Bearing Deposits in Other Banks

188,730

200,066

Securities Available-For-Sale (AFS)

1,446,196

1,250,085

Securities Held-to-Maturity

259,812

255,609

Total Loans

1,140,277

996,503

Less: Allowance for Loan Losses

19,828

17,386

Net Loans

1,120,449

979,117

Unrealized Gain on Securities AFS

11,075

16,541

Bank Premises and Equipment

23,689

22,091

Accrued Interest Receivable

6,004

6,168

Goodwill

2,714

2,714

Other Assets

73,617

68,568

Total Assets