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.