Century Bancorp, Inc. (NASDAQ:CNBKA) (www.centurybank.com) (“the Company”) today announced net income of $21,860,000 for the year ended December 31, 2014, or $3.93 per Class A share diluted, an increase of 9.0% compared to net income of $20,046,000, or $3.61 per Class A share diluted, for the same period a year ago. Total assets increased 5.6% from $3.4 billion at December 31, 2013 to $3.6 billion at December 31, 2014. For the quarter ended December 31, 2014, net income totaled $5,623,000 or $1.01 per Class A share diluted, an increase of 11.9% compared to net income of $5,025,000, or $0.90 per Class A share diluted, for the same period a year ago.

Net interest income totaled $66.2 million for the year ended December 31, 2014 compared to $61.0 million for the same period in 2013. The 8.7% increase in net interest income for the period is primarily due to an increase in average earning assets. The net interest margin increased from 2.21% on a fully taxable equivalent basis in 2013 to 2.22% on the same basis for 2014. This was primarily the result of a decrease in rates paid on deposits and borrowed funds. Also, interest expense increased slightly as a result of an increase in deposit balances and there was a 8.5% increase in the average balances of earning assets, combined with a similar increase in average deposits.

The provision for loan losses decreased by $660,000 from $2.7 million for the year ended December 31, 2013 to $2.1 million for the same period in 2014, primarily as a result of changes in the portfolio composition and changes in qualitative economic factors. The Company capitalized on favorable market conditions for the year ended December 31, 2014 and realized net gains on sales of investments of $450,000, as compared to $3.0 million for the same period in 2013. The Company’s effective tax rate decreased from 4.8% in 2013 to 3.8% in 2014 primarily as a result of an increase in tax-exempt income.

At December 31, 2014, total equity was $192.5 million compared to $176.5 million at December 31, 2013. The Company’s equity increased primarily as a result of earnings, offset somewhat by an increase in other comprehensive loss, net of taxes, and dividends paid. Other comprehensive loss, net of taxes, increased as a result of an increase in the additional pension liability. The pension liability increased as a result of an increase in the discount rate utilized and the impact of recently updated mortality tables. This was offset somewhat by a decrease in unrealized losses on securities available-for-sale and securities transferred from available-for-sale to held-to-maturity. 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 6.91% at December 31, 2014, compared to 6.50% at December 31, 2013. The increase in the leverage ratio was due to an increase in stockholders’ equity, offset somewhat by an increase in quarterly average assets. Book value as of December 31, 2014 was $34.57 per share compared to $31.76 at December 31, 2013.

The Company’s allowance for loan losses was $22.3 million or 1.68% of loans outstanding at December 31, 2014, compared to $20.9 million or 1.66% of loans outstanding at December 31, 2013. The increase in the allowance for loan losses was due to the increase in the size of the loan portfolio. Non-performing assets totaled $4.1 million at December 31, 2014, compared to $2.5 million at December 31, 2013.

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 February 17, 2015 to stockholders of record on February 2, 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)
  December 31,   December 31,

Assets

   2014   2013
Cash and Due From Banks $ 43,367 $ 59,956
Federal Funds Sold and Interest-bearing Deposits In Other Banks 261,991 34,722
 
Short-term Investments 2,131 4,617
 
Securities Available-For-Sale (AFS) 448,390 464,245
 
Securities Held-to-Maturity 1,406,792 1,487,884
 
Federal Home Loan Bank of Boston stock, at cost 24,916 18,072
 
Loans:
Commercial & Industrial 149,732 76,675
Municipal 41,850 32,737
Construction & Land Development 22,744 33,058
Commercial Real Estate 696,272 696,317
Residential Real Estate 257,305 286,041
Consumer and Other 12,188 9,658
Home Equity   151,275   130,277
 
Total Loans 1,331,366 1,264,763
Less: Allowance for Loan Losses   22,318   20,941
 
Net Loans 1,309,048 1,243,822
 
Bank Premises and Equipment, net 24,182 23,400
Accrued Interest Receivable 6,241 6,539
Goodwill 2,714 2,714
Other Assets   94,264   85,183
 
Total Assets $ 3,624,036 $ 3,431,154
 

Liabilities

Demand Deposits $ 484,928 $ 475,862
 
Interest Bearing Deposits:
Savings and NOW Deposits 978,619 992,796
Money Market Accounts 890,899 864,957
Time Deposits   383,145   382,224
 
Total Interest Bearing Deposits   2,252,663   2,239,977
 
Total Deposits 2,737,591 2,715,839
 
Borrowed Funds:
Securities Sold Under Agreements to Repurchase 212,360 214,440
Other Borrowed Funds   395,500   255,144
 
Total Borrowed Funds 607,860 469,584
 
Other Liabilities 50,002 33,176
Subordinated Debentures   36,083   36,083
 
Total Liabilities 3,431,536 3,254,682
 
Total Stockholders' Equity   192,500   176,472
 
Total Liabilities & Stockholders' Equity $ 3,624,036 $ 3,431,154
 
 
Century Bancorp, Inc. and Subsidiaries
Consolidated Comparative Statements of Income (unaudited)
For the Quarter and Year ended December 31, 2014 and 2013
(in thousands)
       
Quarter ended December 31, Year ended December 31,
  2014     2013   2014     2013
 
Interest Income:
Loans $ 12,340 $ 12,562 $ 50,108 $ 49,296
Securities Held-to-Maturity 7,841 7,495 31,745 16,615
Securities Available-for-Sale 800 789 3,166 13,369
Federal Funds Sold and Interest-bearing Deposits In Other Banks   81   101   352   485
 
Total Interest Income 21,062 20,947 85,371 79,765
 
Interest Expense:
Savings and NOW Deposits 628 652 2,539 2,585
Money Market Accounts 682 677 2,715 2,472
Time Deposits 1,106 1,120 4,421 4,777
Securities Sold Under Agreements to Repurchase 107 93 391 361
Other Borrowed Funds and Subordinated Debentures   2,317   2,300   9,070   8,610
 
Total Interest Expense   4,840   4,842   19,136   18,805
 
Net Interest Income 16,222 16,105 66,235 60,960
 
Provision For Loan Losses   400   460   2,050   2,710
 
Net Interest Income After
Provision for Loan Losses 15,822 15,645 64,185 58,250
 
Other Operating Income
Service Charges on Deposit Accounts 1,995 2,073 8,063 8,113
Lockbox Fees 754 733 3,099 3,079
Net Gain on Sales of Investments 450 354 450 3,019
Net Gain on Sales of Loans 536 326 757 1,564
Other Income   693   700   2,902   2,840
 
Total Other Operating Income 4,428 4,186 15,271 18,615
 
Operating Expenses
Salaries and Employee Benefits 8,764 9,386 35,096 35,244
Occupancy 1,398 1,285 5,503 5,000
Equipment 620 552 2,329 2,298
FDIC Assessment 494 478 1,970 1,790
Other   3,230   2,989   11,832   11,480
 
Total Operating Expenses   14,506   14,690   56,730   55,812
 
Income Before Income Taxes 5,744 5,141 22,726 21,053
 
Income Tax Expense   121   116   866   1,007
 
Net Income $ 5,623 $ 5,025 $ 21,860 $ 20,046
 
 
Century Bancorp, Inc. and Subsidiaries
Consolidated Year-to-Date Average Comparative Statements of Condition (unaudited)
(in thousands)
  December 31, December 31,

Assets

   2014     2013  
Cash and Due From Banks $ 65,599 $ 59,603
Federal Funds Sold and Interest-Bearing Deposits in Other Banks 129,472 174,264
 
Securities Available-For-Sale (AFS) 500,928 997,983
Securities Held-to-Maturity (HTM) 1,499,995 812,448
 
Total Loans 1,307,888 1,184,912
Less: Allowance for Loan Losses   21,876     20,452  
 
Net Loans 1,286,012 1,164,460
 

Unrealized (Loss) Gain on Securities AFS and HTM Transfers

(20,172 ) (6,236 )
Bank Premises and Equipment 23,516 23,551
Accrued Interest Receivable 7,095 6,247
Goodwill 2,714 2,714
Other Assets   88,040     81,121  
 
Total Assets $ 3,583,199   $ 3,316,155  
 

Liabilities

Demand Deposits $ 481,035 $ 441,193
 
Interest Bearing Deposits:
Savings and NOW Deposits 1,096,303 1,037,320
Money Market Accounts 920,485 800,052
Time Deposits   372,699     387,514  
Total Interest Bearing Deposits   2,389,487     2,224,886  
 
Total Deposits 2,870,522 2,666,079
 
Borrowed Funds:
Securities Sold Under Agreements to Repurchase 216,937 203,888
Other Borrowed Funds   235,627     194,949  
 
Total Borrowed Funds 452,564 398,837
 
Other Liabilities 35,033 42,017
Subordinated Debentures   36,083     36,083  
 
Total Liabilities 3,394,202 3,143,016
 
Total Stockholders' Equity   188,997     173,139  
 
Total Liabilities & Stockholders' Equity $ 3,583,199   $ 3,316,155  
 
 
Total Average Earning Assets - QTD $ 3,416,046   $ 3,342,186  
 
Total Average Earning Assets - YTD $ 3,438,283   $ 3,169,607  
 
Century Bancorp, Inc. and Subsidiaries
Consolidated Selected Key Financial Information (unaudited)
(in thousands, except share data)   December 31,   December 31,
  2014   2013
 

Performance Measures:

 
Earnings per average Class A share, diluted, quarter $ 1.01 $ 0.90
Earnings per average Class A share, diluted, year-to-date $ 3.93 $ 3.61
Return on average assets, year-to-date 0.61% 0.60%
Return on average stockholders' equity, year-to-date 11.57% 11.58%
Net interest margin (taxable equivalent), quarter 2.18% 2.20%
Net interest margin (taxable equivalent), year-to-date 2.22% 2.21%
Efficiency ratio, year-to-date 62.0% 63.0%
Book value per share $ 34.57 $ 31.76
Tangible book value per share $ 34.09 $ 31.27
Tangible capital / tangible assets 5.24% 5.07%
 
 
Common Share Data:
Average Class A shares outstanding, diluted, quarter 5,567,855 5,557,419
Average Class A shares outstanding, diluted, year-to-date 5,562,209 5,557,693
 
Shares outstanding Class A 3,600,729 3,580,404
Shares outstanding Class B   1,967,180   1,976,180
Total shares outstanding at period end   5,567,909   5,556,584
 
 

Asset Quality and Other Data:

 
Allowance for loan losses / loans 1.68% 1.66%
Nonaccrual loans $ 4,146 $ 2,549
Nonperforming assets $ 4,146 $ 2,549
Loans 90 days past due and still accruing $ - $ -
Accruing troubled debt restructures $ 3,296 $ 5,969
Net charge-offs, year-to-date $ 673 $ 966
 
Leverage ratio 6.91% 6.50%
Tier 1 risk weighted capital ratio 13.87% 13.67%
Total risk weighted capital ratio 15.12% 14.92%
Total risk weighted assets $ 1,779,573 $ 1,660,881