Century Bancorp, Inc. Announces Earnings for Q1 2015, Up 0.5%; Asset Growth to Record Size of $3.8 BB; Regular Dividend Declared

MEDFORD, Mass.--()--Century Bancorp, Inc. (NASDAQ:CNBKA) (www.centurybank.com) (“the Company”) today announced net income of $4,959,000 for the quarter ended March 31, 2015, or $0.89 per Class A share diluted, an increase of 0.5% compared to net income of $4,932,000, or $0.89 per Class A share diluted, for the same period a year ago. Total assets increased 4.1% from $3.6 billion at December 31, 2014 to $3.8 billion at March 31, 2015. Earnings are up slightly compared to the same period last year; however, the harsh winter caused increased expenses and lower revenues during the first quarter of 2015 compared to the same period a year ago.

Net interest income totaled $16.4 million for the quarter ended March 31, 2015 compared to $16.5 million for the same period in 2014. The 0.6% decrease in net interest income for the period is primarily due to a decrease in the net interest margin. The net interest margin decreased from 2.27% on a fully taxable equivalent basis in 2014 to 2.12% on the same basis for 2015. This was primarily the result of a decrease in rates on earning assets. Also, interest expense increased slightly as a result of an increase in deposit balances and there was a 7.8% increase in the average balances of earning assets, combined with a similar increase in average deposits.

The provision for loan losses decreased by $400,000 from $600,000 for the quarter ended March 31, 2014 to $200,000 for the same period in 2015, primarily as a result of stable loan balances and low charge-off levels. The Company’s effective tax rate decreased from 5.6% in 2014 to 4.2% in 2015 primarily as a result of an increase in tax-exempt income.

At March 31, 2015, total equity was $197.8 million compared to $192.5 million at December 31, 2014. The Company’s equity increased primarily as a result of earnings and a decrease in other comprehensive loss, net of taxes, offset somewhat by dividends paid. Other comprehensive loss, net of taxes, decreased as a result of a decrease in unrealized losses on securities available-for-sale and securities transferred from available-for-sale to held-to-maturity and amortization of the pension liability. During the third quarter of 2013, $987.0 million of securities available-for-sale with unrealized losses of $25.3 million were transferred to securities held-to-maturity. This was done in response to rising interest rates.

The Company’s leverage ratio stood at 6.60% at March 31, 2015, compared to 6.91% at December 31, 2014. The decrease in the leverage ratio was due to an increase in quarterly average assets, offset somewhat by an increase in stockholders’ equity. Book value as of March 31, 2015 was $35.53 per share compared to $34.57 at December 31, 2014.

The Company’s allowance for loan losses was $22.5 million or 1.68% of loans outstanding at March 31, 2015, compared to $22.3 million or 1.68% of loans outstanding at December 31, 2014 and $21.3 million or 1.68% of loans outstanding at March 31, 2014. The increase in the allowance for loan losses was due to the increase in the size of the loan portfolio. Non-performing assets totaled $4.3 million at March 31, 2015, compared to $4.1 million at December 31, 2014 and $1.6 million at March 31, 2014.

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 May 15, 2015 to stockholders of record on May 1, 2015.

The Company, through its subsidiary bank, Century Bank and Trust Company, a state chartered full service commercial bank, operating twenty-six 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)
    March 31,     December 31,

Assets

  2015   2014
Cash and Due From Banks $ 59,680 $ 43,367
Federal Funds Sold and Interest-bearing Deposits In Other Banks 5,945 261,991
 
Short-term Investments 2,139 2,131
 
Securities Available-For-Sale (AFS) 455,931 448,390
 
Securities Held-to-Maturity 1,773,607 1,406,792
 
Federal Home Loan Bank of Boston stock, at cost 24,916 24,916
 
Loans:
Commercial & Industrial 157,637 149,732
Municipal 41,406 41,850
Construction & Land Development 25,347 22,744
Commercial Real Estate 691,811 696,272
Residential Real Estate 258,558 257,305
Consumer and Other 10,508 12,188
Home Equity   156,063   151,275
 
Total Loans 1,341,330 1,331,366
Less: Allowance for Loan Losses   22,529   22,318
 
Net Loans 1,318,801 1,309,048
 
Bank Premises and Equipment, net 24,179 24,182
Accrued Interest Receivable 6,913 6,241
Goodwill 2,714 2,714
Other Assets   98,498   94,264
 
Total Assets $ 3,773,323 $ 3,624,036
 

Liabilities

Demand Deposits $ 508,820 $ 484,928
 
Interest Bearing Deposits:
Savings and NOW Deposits 1,063,551 978,619
Money Market Accounts 960,668 890,899
Time Deposits   382,456   383,145
 
Total Interest Bearing Deposits   2,406,675   2,252,663
 
Total Deposits 2,915,495 2,737,591
 
Borrowed Funds:
Securities Sold Under Agreements to Repurchase 260,390 212,360
Other Borrowed Funds   307,642   395,500
 
Total Borrowed Funds 568,032 607,860
 
Other Liabilities 55,885 50,002
Subordinated Debentures   36,083   36,083
 
Total Liabilities 3,575,495 3,431,536
 
Total Stockholders' Equity   197,828   192,500
 
Total Liabilities & Stockholders' Equity $ 3,773,323 $ 3,624,036
 
 
Century Bancorp, Inc. and Subsidiaries
Consolidated Comparative Statements of Income (unaudited)
For the Quarter ended March 31, 2015 and 2014
(in thousands)
       
Quarter ended March 31,
  2015       2014
 
Interest Income:
Loans $ 12,076 $ 12,449
Securities Held-to-Maturity 8,168 7,780
Securities Available-for-Sale 732 820
Federal Funds Sold and Interest-bearing Deposits In Other Banks   196   82
 
Total Interest Income 21,172 21,131
 
Interest Expense:
Savings and NOW Deposits 628 609
Money Market Accounts 782 639
Time Deposits 1,156 1,085
Securities Sold Under Agreements to Repurchase 114 101
Other Borrowed Funds and Subordinated Debentures   2,085   2,183
 
Total Interest Expense   4,765   4,617
 
Net Interest Income 16,407 16,514
 
Provision For Loan Losses   200   600
 
Net Interest Income After
Provision for Loan Losses 16,207 15,914
 
Other Operating Income
Service Charges on Deposit Accounts 1,913 2,034
Lockbox Fees 788 777
Net Gain on Sales of Loans 99 7
Other Income   705   652
 
Total Other Operating Income 3,505 3,470
 
Operating Expenses
Salaries and Employee Benefits 9,134 8,875
Occupancy 1,605 1,442
Equipment 593 572
FDIC Assessment 503 480
Other   2,703   2,790
 
Total Operating Expenses   14,538   14,159
 
Income Before Income Taxes 5,174 5,225
 
Income Tax Expense   215   293
 
Net Income $ 4,959 $ 4,932
 
 
Century Bancorp, Inc. and Subsidiaries
Consolidated Year-to-Date Average Comparative Statements of Condition (unaudited)
(in thousands)
    March 31,     March 31,

Assets

  2015     2014  
Cash and Due From Banks $ 71,131 $ 65,827
Federal Funds Sold and Interest-Bearing Deposits in Other Banks 300,638 121,093
 
Securities Available-For-Sale (AFS) 466,673 494,242
Securities Held-to-Maturity (HTM) 1,530,383 1,492,839
 
Total Loans 1,338,433 1,265,049
Less: Allowance for Loan Losses   22,511     21,193  
 
Net Loans 1,315,922 1,243,856
 
Unrealized (Loss)Gain on Securities AFS and HTM Transfers (16,432 ) (23,077 )
Bank Premises and Equipment 24,244 23,336
Accrued Interest Receivable 7,071 7,195
Goodwill 2,714 2,714
Other Assets   96,015     86,313  
 
Total Assets $ 3,798,359   $ 3,514,338  
 

Liabilities

Demand Deposits $ 490,020 $ 468,623
 
Interest Bearing Deposits:
Savings and NOW Deposits 1,096,744 1,072,313
Money Market Accounts 999,901 904,036
Time Deposits   377,433     376,793  
Total Interest Bearing Deposits   2,474,078     2,353,142  
 
Total Deposits 2,964,098 2,821,765
 
Borrowed Funds:
Securities Sold Under Agreements to Repurchase 248,508 226,927
Other Borrowed Funds   303,024     216,212  
 
Total Borrowed Funds 551,532 443,139
 
Other Liabilities 51,639 33,610
Subordinated Debentures   36,083     36,083  
 
Total Liabilities 3,603,352 3,334,597
 
Total Stockholders' Equity   195,007     179,741  
 
Total Liabilities & Stockholders' Equity $ 3,798,359   $ 3,514,338  
 
 
Total Average Earning Assets - YTD $ 3,636,127   $ 3,373,223  
 
     
Century Bancorp, Inc. and Subsidiaries
Consolidated Selected Key Financial Information (unaudited)
(in thousands, except share data) March 31, March 31,
  2015     2014  
 

Performance Measures:

 
Earnings per average Class A share, diluted, quarter $ 0.89 $ 0.89
Return on average assets, year-to-date 0.53 % 0.57 %
Return on average stockholders' equity, year-to-date 10.31 % 11.13 %
Net interest margin (taxable equivalent), quarter 2.12 % 2.27 %
Efficiency ratio, year-to-date 64.6 % 63.3 %
Book value per share $ 35.53 $ 32.77
Tangible book value per share $ 35.04 $ 32.28
Tangible capital / tangible assets 5.17 % 5.13 %
 
 
Common Share Data:
Average Class A shares outstanding, diluted, quarter 5,567,909 5,558,177
 
Shares outstanding Class A 3,600,729 3,582,479
Shares outstanding Class B   1,967,180     1,974,180  
Total shares outstanding at period end   5,567,909     5,556,659  
 
 

Asset Quality and Other Data:

 
Allowance for loan losses / loans 1.68 % 1.68 %
Nonaccrual loans $ 4,260 $ 1,560
Nonperforming assets $ 4,260 $ 1,560
Loans 90 days past due and still accruing $ 34 $ -
Accruing troubled debt restructures $ 3,238 $ 5,811
Net (recoveries)charge-offs, year-to-date $ (11 ) $ 282
 
Leverage ratio 6.60 % * 6.57 %
Common equity tier 1 risk weighted capital ratio 11.00 % * n/a
Tier 1 risk weighted capital ratio 12.78 % * 13.84 %
Total risk weighted capital ratio 13.93 % * 15.09 %
Total risk weighted assets $ 1,965,046 * $ 1,672,745
 
* computed utilizing recently implemented Basel III regulatory capital framework.

Contacts

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

Contacts

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