Century Bancorp, Inc. Announces Increased Earnings for Q2, up 14%; Asset Growth to Record Size of $3 BB; Regular Dividend Declared

MEDFORD, Mass.--()--Century Bancorp, Inc. (NASDAQ:CNBKA) (www.centurybank.com) (“the Company”) today announced net income of $8,579,000 for the first six months ended June 30, 2012, or $1.55 per Class A share diluted, an increase of 8.3% compared to net income of $7,922,000, or $1.43 per Class A share diluted, for the same period a year ago. Total assets increased 9.4% from $2.7 billion at December 31, 2011 to $3.0 billion at June 30, 2012. For the quarter ended June 30, 2012, net income totaled $4,771,000, or $0.86 per Class A share diluted, an increase of 13.7% compared to net income of $4,197,000, or $0.76 per Class A share diluted, for the same period a year ago.

Net interest income totaled $29.8 million for the first six months of 2012 compared to $27.4 million for the same period in 2011. The 8.6% increase in net interest income for the period is due to a 10.6% increase in the average balances of earning assets, combined with a similar increase in average deposits, offset by a decrease in the net interest margin from 2.53% on a fully taxable equivalent basis in 2011 to 2.50% on the same basis for 2012.

The provision for loan losses decreased by $400,000 from $2.4 million for the six months ended June 30, 2011 to $2.0 million, for the six months ended June 30, 2012, primarily as a result of changes in the composition of the loan portfolio. The Company capitalized on favorable market conditions for the first six months ended June 30, 2012 and realized net gains on sales of investments of $590,000, compared to $362,000 for the same period in 2011. FDIC assessments decreased for the first six months of 2012, primarily as a result of a decrease in the assessment rate, offset somewhat by an increase in the assessment base. The Company’s effective tax rate increased slightly from 6.1% in 2011 to 6.2% in 2012. The Company’s income tax rate has remained low primarily as a result of tax-exempt income.

At June 30, 2012, total equity was $170.7 million compared to $160.6 million at December 31, 2011. The Company’s equity increased primarily as a result of earnings and other comprehensive income, net of taxes, offset somewhat by dividends paid. The Company’s leverage ratio stood at 6.90% at June 30, 2012, compared to 7.00% at June 30, 2011. This decline in the leverage ratio is due to an increase in assets, offset by an increase in stockholders’ equity. Book value as of June 30, 2012 was $30.77 per share compared to $28.04 at June 30, 2011.

The Company’s allowance for loan losses was $18.0 million or 1.75% of loans outstanding at June 30, 2012, compared to $16.6 million or 1.68% of loans outstanding at December 31, 2011 and $15.9 million, or 1.65% of loans outstanding at June 30, 2011. Non-performing assets totaled $5.3 million at June 30, 2012, compared to $7.0 million at December 31, 2011 and $12.3 million at June 30, 2011.

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, 2012 to stockholders of record on August 1, 2012.

The Company, through its subsidiary bank, Century Bank and Trust Company, a state chartered full service commercial bank, operating twenty-four 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

2012 2011
Cash and Due From Banks $ 58,530 $ 50,187
Federal Funds Sold and Interest-bearing Deposits In Other Banks 270,128 157,579
 
Short-term Investments 22,136 18,351
 
Securities Available-For-Sale (AFS) 1,237,024 1,258,676
 
Securities Held-to-Maturity 286,662 179,368
 
Federal Home Loan Bank of Boston stock, at cost 15,146 15,531
 
Loans:
Commercial & Industrial 78,971 82,404
Construction & Land Development 36,422 56,819
Commercial Real Estate 535,232 487,495
Residential Real Estate 259,006 239,307
Consumer and Other 6,597 7,681
Home Equity   112,602   110,786
 
Total Loans 1,028,830 984,492
Less: Allowance for Loan Losses   17,979   16,574
 
Net Loans 1,010,851 967,918
 
Bank Premises and Equipment 22,887 21,757
Accrued Interest Receivable 5,872 6,022
Goodwill 2,714 2,714
Core Deposit Intangible 0 120
Other Assets   68,324   65,002
 
Total Assets $ 3,000,274 $ 2,743,225
 

Liabilities

Demand Deposits $ 403,999 $ 365,854
 
Interest Bearing Deposits:
Savings and NOW Deposits 810,018 708,988
Money Market Accounts 705,963 616,241
Time Deposits   419,414   433,501
 
Total Interest Bearing Deposits   1,935,395   1,758,730
 
Total Deposits 2,339,394 2,124,584
 
Borrowed Funds:
Securities Sold Under Agreements to Repurchase 173,190 143,320
Other Borrowed Funds   208,553   244,143
 
Total Borrowed Funds 381,743 387,463
 
Other Liabilities 72,346 34,446
Subordinated Debentures   36,083   36,083
 
Total Liabilities 2,829,566 2,582,576
 
Total Stockholders' Equity   170,708   160,649
 
Total Liabilities & Stockholders' Equity $ 3,000,274 $ 2,743,225
 
 
Century Bancorp, Inc. and Subsidiaries                        
Consolidated Comparative Statements of Income (unaudited)
For the Quarter and Six months ended June 30, 2012 and 2011
(in thousands)
 
Quarter ended June 30, Six months ended June 30,
2012

 

    2011 2012       2011
 
Interest Income:
Loans $ 12,572 $ 12,012 $ 24,620 $ 24,117
Securities Held-to-Maturity 1,924 1,518 3,387 3,291
Securities Available-for-Sale 5,668 5,709 11,383 11,062
Federal Funds Sold and Interest-bearing Deposits In Other Banks   148   358   287   705
 
Total Interest Income 20,312 19,597 39,677 39,175
 
Interest Expense:
Savings and NOW Deposits 560 719 1,087 1,431
Money Market Accounts 618 777 1,230 1,482
Time Deposits 1,600 2,494 3,281 4,773
Securities Sold Under Agreements to Repurchase 88 98 180 208
Other Borrowed Funds and Subordinated Debentures   2,057   1,994   4,108   3,839
 
Total Interest Expense   4,923   6,082   9,886   11,733
 
Net Interest Income 15,389 13,515 29,791 27,442
 
Provision For Loan Losses   900   1,200   2,000   2,400
 
Net Interest Income After
Provision for Loan Losses 14,489 12,315 27,791 25,042
 
Other Operating Income
Service Charges on Deposit Accounts 1,922 1,936 3,910 3,823
Lockbox Fees 781 734 1,480 1,471
Net Gain on Sales of Investments 442 198 590 362
Other Income   843   973   1,627   1,720
 
Total Other Operating Income 3,988 3,841 7,607 7,376
 
Operating Expenses
Salaries and Employee Benefits 8,191 7,250 16,332 14,591
Occupancy 1,176 975 2,298 2,226
Equipment 544 534 1,127 1,092
FDIC Assessment 445 464 852 1,199
Other   3,095   2,552   5,642   4,877
 
Total Operating Expenses   13,451   11,775   26,251   23,985
 
Income Before Income Taxes 5,026 4,381 9,147 8,433
 
Income Tax Expense   255   184   568   511
 
Net Income $ 4,771 $ 4,197 $ 8,579 $ 7,922
 
 
Century Bancorp, Inc. and Subsidiaries            
Consolidated Year-to-Date Average Comparative Statements of Condition (unaudited)
(in thousands)
June 30, June 30,

Assets

2012 2011
Cash and Due From Banks $ 52,885 $ 51,938
Federal Funds Sold and Interest-Bearing Deposits in Other Banks 200,066 306,157
 
Securities Available-For-Sale (AFS) 1,250,085 990,345
Securities Held-to-Maturity 255,609 205,996
 
Total Loans 996,503 940,076
Less: Allowance for Loan Losses   17,386   15,017
 
Net Loans 979,117 925,059
 
Unrealized Gain on Securities AFS 16,541 7,286
Bank Premises and Equipment 22,091 21,238
Accrued Interest Receivable 6,168 6,822
Goodwill 2,714 2,714
Core Deposit Intangible 43 416
Other Assets   68,525   63,139
 
Total Assets $ 2,853,844 $ 2,581,110
 

Liabilities

Demand Deposits $ 364,588 $ 310,522
 
Interest Bearing Deposits:
Savings and NOW Deposits 830,199 721,931
Money Market Accounts 656,662 570,448
Time Deposits   422,256   473,464
Total Interest Bearing Deposits   1,909,117   1,765,843
 
Total Deposits 2,273,705 2,076,365
 
Borrowed Funds:
Securities Sold Under Agreements to Repurchase 161,112 123,582
Other Borrowed Funds   180,131   166,699
 
Total Borrowed Funds 341,243 290,281
 
Other Liabilities 36,564 28,801
Subordinated Debentures   36,083   36,083
 
Total Liabilities 2,687,595 2,431,530
 
Total Stockholders' Equity   166,249   149,580
 
Total Liabilities & Stockholders' Equity $ 2,853,844 $ 2,581,110
 
 
Total Average Earning Assets - QTD $ 2,761,669 $ 2,505,504
 
Total Average Earning Assets - YTD $ 2,702,263 $ 2,442,574
 
 
Century Bancorp, Inc. and Subsidiaries              
Consolidated Selected Key Financial Information (unaudited)
(in thousands, except share data) June 30, June 30,
2012 2011
 

Performance Measures:

 
Earnings per average Class A share, diluted, quarter $ 0.86 $ 0.76
Earnings per average Class A share, diluted, year-to-date $ 1.55 $ 1.43
Return on average assets, year-to-date 0.60 % 0.62 %
Return on average stockholders' equity, year-to-date 10.38 % 10.68 %
Net interest margin (taxable equivalent), quarter 2.52 % 2.43 %
Net interest margin (taxable equivalent), year-to-date 2.50 % 2.53 %
Efficiency ratio, year-to-date 63.7 % 63.0 %
Book value per share $ 30.77 $ 28.04
Tangible book value per share $ 30.28 $ 27.49
Tangible capital / tangible assets 5.60 % 5.87 %
 
 
Common Share Data:
Average Class A shares outstanding, diluted, quarter 5,548,830 5,541,595
Average Class A shares outstanding, diluted, year-to-date 5,547,237 5,541,743
 
Shares outstanding Class A 3,556,529 3,543,717
Shares outstanding Class B   1,991,880     1,996,880  
Total shares outstanding at period end   5,548,409     5,540,597  
 
 

Asset Quality and Other Data:

 
Allowance for loan losses / loans 1.75 % 1.65 %
Nonaccrual loans $ 5,313 $ 12,314
Nonperforming assets $ 5,313 $ 12,314
Loans 90 days past due and still accruing $ 57 $ 546
Accruing troubled debt restructures $ 2,274 $ 3,921
Net charge-offs, year-to-date $ 594 $ 538
 
Leverage ratio 6.90 % 7.00 %
Tier 1 risk weighted capital ratio 14.36 % 14.54 %
Total risk weighted capital ratio 15.61 % 15.79 %
Total risk weighted assets $ 1,393,806 $ 1,269,913

Contacts

Century Bancorp, Inc.
William P. Hornby, CPA, 781-393-4630
whornby@centurybank.com
Fax: 781-393-4071

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Contacts

Century Bancorp, Inc.
William P. Hornby, CPA, 781-393-4630
whornby@centurybank.com
Fax: 781-393-4071