United Financial Bancorp 8-K United Financial Bancorp Reports First Quarter 2012

Exhibit 99.1

FOR IMMEDIATE RELEASE	For More Information Contact:
	Mark A. Roberts
	Executive Vice President & CFO
	(413) 787-1700

UNITED FINANCIAL BANCORP REPORTS FIRST QUARTER 2012

EARNINGS OF $2.8 MILLION, OR $0.19 PER DILUTED SHARE;

ANNOUNCES QUARTERLY DIVIDEND OF $0.09 PER SHARE

WEST SPRINGFIELD, MA — April 20, 2012 — United Financial Bancorp, Inc. (the “Company”) (NASDAQ Global Select Market: UBNK), the holding company for United Bank (the “Bank”), reported net income of $2.8 million, or $0.19 per diluted share, for the first quarter of 2012 compared to net income of $2.4 million, or $0.16 per diluted share, for the corresponding period in 2011. The Company also announced a quarterly cash dividend of $0.09 per share, payable on June 4, 2012 to shareholders of record as of May 11, 2012.

Financial Highlights:

• Diluted earnings per share increased 19% compared to the same quarter last year.

• Net income grew 17% compared to the first quarter of 2011.

• Total loans increased 2% to $1.139 billion at March 31, 2012 from $1.122 billion at December 31, 2011, primarily due to increases of 4% in commercial mortgages and 3% in commercial business loans.

• Credit quality remained solid, as demonstrated by the non-performing loans to total loans ratio of 79 basis points at March 31, 2012 and an annualized net charge-offs to average loans ratio of 16 basis points in the first quarter of 2012.

• Core deposits increased 4% to $841.4 million at March 31, 2012 from $808.2 million at December 31, 2011.

• Tangible book value per share was $14.00 at March 31, 2012. During the first quarter of 2012, the Company repurchased 129,200 shares at an average price of $15.90 per share. At March 31, 2012, the Company had approximately 201,000 shares remaining to be purchased under its current plan approved in October 2010.

“We are pleased with our first quarter performance which reflects strong growth in commercial loans and core deposits, excellent asset quality and a healthy balance sheet. We remain focused on profitably expanding our franchise through organic loan and deposit growth while maintaining excellent asset quality and effectively managing our capital and liquidity positions,” commented Richard B. Collins, President and Chief Executive Officer. “We have recently established a loan production office in Connecticut staffed by a seasoned commercial lending professional. We look forward to expanding the United Bank brand into this new market later this spring.”

Earnings Summary (Q1 2012 compared to Q1 2011)

Net income increased $420,000, or 17%, to $2.8 million for the first quarter of 2012 compared to $2.4 million for the same period last year largely due to an increase in net interest income, growth in non-interest income and a decrease in provision for loan losses, offset in part by higher non-interest expense.

• Net interest income increased $309,000, or 2%, to $13.1 million in the first quarter of 2012 mainly as a result of an increase in average interest earning assets. Total average earning assets increased $32.1 million, or 2%, to $1.526 billion for the first quarter of 2012 driven by loan growth of 4%. The net interest margin increased by 1 basis point to 3.43% for the three months ended March 31, 2012.

• Provision for loan losses decreased by $158,000, or 20%, to $650,000 for the three months ended March 31, 2012 driven by reductions in loan loss reserve factors and classified loans. The decrease in loan loss reserve factors is a result of improving asset quality trends and positive changes in the economic conditions.

• Non-interest incomeincreased by $424,000, or 20%, to $2.6 million for the three months ended March 31, 2012. The growth in non-interest income was primarily due to:

• an increase of $116,000, or 9%, in fee income on deposit accounts driven by higher overdraft fees and growth in ATM and debit card income;

• growth of $109,000, or 33%, in bank-owned life insurance (BOLI) income reflecting an additional $10 million BOLI investment in May 2011; and

• improvement in net gain on sales of loans of $85,000 due to increased volume and pricing.

• Non-interest expense increased $335,000, or 3%, to $11.3 million for the first quarter of 2012 mainly driven by increases in other expenses and salaries and benefits, partially offset by a decrease in professional fees. Other expenses increased $278,000, or 23%, reflecting higher depreciation and mortgage servicing rights expenses. The increase in depreciation expenses was due to an adjustment in the first quarter of 2011 related to the Company’s acquisition of CNB Financial Corp. in November 2009. Salaries and benefits increased by $173,000, or 3%, mainly attributable to annual merit increases, additional staffing hired to support and facilitate the Bank’s expansion, the opening of a new loan production office in Beverly, MA in the second quarter of 2011and a higher incentive compensation accrual. These unfavorable variances were partially reduced by a $155,000, or 23%, decrease in professional fees related to lower legal and consulting activities.

• Income taxes increased $136,000, or 18%, to $899,000 for the three months ended March 31, 2012 primarily due to higher pre-tax income. The Company’s effective tax rate was 24% in both quarters.

Balance Sheet Activity:

• Total assets increased $36.4 million, or 2%, from 2011 year end to $1.660 billion at March 31, 2012 from $1.624 billion at December 31, 2011 reflecting growth in loans and cash balances.

• Total loans increased $17.5 million, or 2%, to $1.139 billion at March 31, 2012 reflecting growth in the commercial mortgages and commercial and industrial portfolios, partially offset by modest run-off in the residential mortgage, home equity and consumer loan portfolios. Commercial mortgage and commercial and industrial loan growth was primarily attributable to business development efforts, competitive products and pricing. The decrease in residential mortgages was driven by sales of 30-year fixed rate loans, offset to a large extent by originations of 10 and 15-year fixed rate loans.

• Cash and cash equivalentsincreased $14.0 million, or 23%, to $75.5 million at March 31, 2012 mainly driven by strong deposit growth.

• Total deposits increased $28.7 million, or 2%, to $1.259 billion at March 31, 2012 reflecting growth of $33.2 million, or 4%, in core account balances, partially offset by a decrease of $4.5 million, or 1%, in certificates of deposit. The strong growth in core account balances was driven by the success of sales and marketing initiatives, competitive products and pricing and excellent customer service. Core deposit balances were $841.4 million, or 67% of total deposits at March 31, 2012 compared to $808.2 million, or 66% at December 31, 2011.

• Short-term debtincreased $6.3 million, or 37%, mainly due to growth in overnight repurchase agreements.

Credit Quality:

• Non-performing assets totaled $11.6 million, or 0.70% of total assets, at March 31, 2012 compared to $10.6 million, or 0.65% of total assets, at December 31, 2011. The $1.0 million increase in non-performing assets is primarily driven by two new non-performing loans and an increase in other real estate owned.

• At March 31, 2012, the ratio of the allowance for loan losses to total loans was 0.99%, equal to the prior year end level. Excluding the impact of loans acquired from CNB Financial Corp. and other financial institutions totaling $154.7 million at March 31, 2012 and $165.1 million at December 31, 2011, the ratio of the allowance for loan losses to total loans would have been 1.15% at March 31, 2012 and 1.16% at December 31, 2011. Net charge-offs totaled $457,000 or 0.16% of average loans outstanding for the quarter ended March 31, 2012 as compared to net charge-offs of $327,000 or 0.12% of average loans outstanding for the first quarter of 2011. The increase in net charge-offs resulted from write-offs of several small loans which became uncollectible.

Capital and Liquidity:

• At March 31, 2012, the Company remains well capitalized with a tangible equity-to-tangible assets ratio of 13.22% and an equity-to-assets ratio of 13.69%.

• At March 31, 2012, the Company continued to have considerable liquidity consisting of significant balances at the Federal Reserve Bank of Boston, a large amount of marketable loans and investment securities, substantial unused borrowing capacity at the Federal Home Loan Bank of Boston and the Federal Reserve Bank of Boston and access to funding through the repurchase agreement and brokered deposit markets.

United Financial Bancorp, Inc. is a publicly owned corporation and the holding company for United Bank, a federally chartered bank headquartered at 95 Elm Street, West Springfield, MA, 01090. The Company’s common stock is traded on the NASDAQ Global Select Market under the symbol UBNK. United Bank provides an array of financial products and services through its 16 branch offices and two express drive-up branches in the Springfield region of Western Massachusetts and six branches in the Worcester region of Central Massachusetts. The bank also operates a loan production office located in Beverly, Massachusetts. Through its Wealth Management Group, the Bank offers access to a wide range of investment and insurance products and services, as well as financial, estate and retirement strategies and products. For more information regarding the Bank’s products and services and for United Financial Bancorp, Inc. investor relations information please visitwww.bankatunited.com or on Facebook atfacebook.com/bankatunited.

Except for the historical information contained in this press release, the matters discussed may be deemed to be forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties, including changes in economic conditions in the Company’s market area, changes in policies by regulatory agencies, fluctuations in interest rates, demand for loans in the Company’s market area, competition, and other risks detailed from time to time in the Company’s SEC reports. Actual strategies and results in future periods may differ materially from those currently expected. These forward-looking statements represent the Company’s judgment as of the date of this release. The Company disclaims, however, any intent or obligation to update these forward-looking statements.

UNITED FINANCIAL BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CONDITION

(Dollars in thousands, except per share amounts)

	March 31, 2012			December 31, 2011			March 31, 2011
	(unaudited)			(audited)			(unaudited)
Assets
Cash and cash equivalents	$	75,548		$	61,518		$	72,539
Investment securities		340,712			337,710			339,609
Loans held for sale		685			53			583
Loans:
Residential mortgages		312,065			314,839			317,307
Commercial mortgages		467,022			450,180			429,949
Construction loans		30,191			30,271			30,512
Commercial loans		181,512			176,086			165,607
Home equity loans		134,368			135,518			135,625
Consumer loans		14,186			14,985			18,001
Total loans		1,139,344			1,121,879			1,097,001
Net deferred loan costs and fees		2,255			2,194			2,043
Allowance for loan losses		(11,325	)		(11,132	)		(10,468	)
Loans, net		1,130,274			1,112,941			1,088,576
Federal Home Loan Bank of Boston stock, at cost		14,454			15,365			15,365
Other real estate owned		2,442			2,054			1,480
Deferred tax asset, net		14,368			14,006			10,821
Premises and equipment, net		17,333			16,438			15,746
Bank-owned life insurance		41,084			40,688			29,474
Goodwill		8,192			8,192			8,192
Other intangible assets		712			752			1,031
Other assets		14,394			14,035			16,309
Total assets	$	1,660,198		$	1,623,752		$	1,599,725
Liabilities and Stockholders’ Equity
Deposits:
Demand	$	208,553		$	205,902		$	181,208
NOW		58,078			52,899			42,117
Savings		263,076			247,664			227,069
Money market		311,684			301,770			273,536
Certificates of deposit		417,238			421,740			449,981
Total deposits		1,258,629			1,229,975			1,173,911
Short-term borrowings		23,561			17,260			18,900
Long-term debt		126,704			126,857			161,461
Subordinated debentures		5,562			5,539			5,471
Escrow funds held for borrowers		2,250			2,103			2,194
Due to broker		87			—			—
Capitalized lease obligations		4,837			4,874			4,978
Accrued expenses and other liabilities		11,320			9,783			8,758
Total liabilities		1,432,950			1,396,391			1,375,673
Stockholders’ Equity:
Preferred stock, par value $0.01 per share, authorized 50,000,000 shares; none issued		—			—			—
Common stock, par value $0.01 per share; authorized 100,000,000 shares; shares issued: 18,706,933 at March 31, 2012, December 31, 2011 and March 31, 2011		187			187			187
Additional paid-in capital		182,671			182,475			180,926
Retained earnings		90,553			88,977			84,128
Unearned compensation		(9,874	)		(10,047	)		(10,578	)
Accumulated other comprehensive income, net of taxes		6,549			6,752			4,512
Treasury stock, at cost (3,108,811 shares at March 31, 2012, 2,994,036 shares at December 31, 2011 and 2,610,898 shares at March 31, 2011)		(42,838	)		(40,983	)		(35,123	)
Total stockholders’ equity		227,248			227,361			224,052
Total liabilities and stockholders’ equity	$	1,660,198		$	1,623,752		$	1,599,725

UNITED FINANCIAL BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED INCOME STATEMENTS

(Dollars in thousands, except per share amounts)

	Three Months Ended March 31,
	2012		2011
	(unaudited)
Interest and dividend income:
Loans	$	14,075	$	14,487
Investments		2,855		3,191
Other interest-earning assets		41		40
Total interest and dividend income		16,971		17,718
Interest expense:
Deposits		2,753		3,297
Borrowings		1,118		1,630
Total interest expense		3,871		4,927
Net interest income before provision for loan losses		13,100		12,791
Provision for loan losses		650		808
Net interest income after provision for loan losses		12,450		11,983
Non-interest income:
Fee income on depositors’ accounts		1,408		1,292
Wealth management income		227		240
Income from bank-owned life insurance		440		331
Net gain on sales of loans		108		23
Net gain on sales of securities		—		1
Other income		390		262
Total non-interest income		2,573		2,149
Non-interest expense:
Salaries and benefits		6,442		6,269
Occupancy expenses		874		844
Marketing expenses		440		447
Data processing expenses		1,020		988
Professional fees		506		661
FDIC insurance assessments		269		330
Low income housing tax credit fund		243		198
Other expenses		1,481		1,203
Total non-interest expense		11,275		10,940
Income before income taxes		3,748		3,192
Income tax expense		899		763
Net income	$	2,849	$	2,429
Earnings per share:
Basic	$	0.19	$	0.16
Diluted	$	0.19	$	0.16
Weighted average shares outstanding:
Basic		14,671		15,014
Diluted		14,987		15,259

UNITED FINANCIAL BANCORP, INC. AND SUBSIDIARY

SELECTED DATA AND RATIOS (unaudited)

(Dollars in thousands, except per share amounts)

	At or For The Quarters Ended
	Mar. 31 2012			Dec. 31 2011			Sep. 30 2011			Jun. 30 2011			Mar. 31 2011
Operating Results:
Net interest income	$	13,100		$	13,241		$	13,399		$	13,382		$	12,791
Loan loss provision		650			1,011			750			673			808
Non-interest income		2,573			2,570			2,423			2,211			2,149
Non-interest expense		11,275			10,718			11,001			11,403			10,940
Net income		2,849			2,980			3,085			2,690			2,429
Performance Ratios (annualized):
Return on average assets		0.70	%		0.74	%		0.77	%		0.67	%		0.62	%
Return on average equity		5.00	%		5.24	%		5.41	%		4.76	%		4.36	%
Net interest margin		3.43	%		3.51	%		3.56	%		3.55	%		3.42	%
Non-interest income to average total assets		0.63	%		0.64	%		0.60	%		0.55	%		0.54	%
Non-interest expense to average total assets		2.77	%		2.66	%		2.74	%		2.85	%		2.77	%
Efficiency ratio		72.44	%(1)		68.41	%(1)		69.61	%(1)		73.09	%(1)		73.34	%(1)
Per Share Data:
Diluted earnings per share	$	0.19		$	0.20		$	0.20		$	0.18		$	0.16
Book value per share	$	14.57		$	14.47		$	14.36		$	14.15		$	13.92
Tangible book value per share	$	14.00	(2)	$	13.90	(2)	$	13.79	(2)	$	13.58	(2)	$	13.35	(2)
Market price at period end	$	15.82		$	16.09		$	13.69		$	15.43		$	16.51
Risk Profile
Equity as a percentage of assets		13.69	%		14.00	%		14.11	%		14.15	%		14.01	%
Tangible equity as a percentage of tangible assets		13.22	%(2)		13.53	%(2)		13.63	%(2)		13.66	%(2)		13.51	%(2)
Net charge-offs to average loans outstanding (annualized)		0.16	%		0.22	%		0.23	%		0.18	%		0.12	%
Non-performing assets as a percent of total assets		0.70	%		0.65	%		0.85	%		0.77	%		0.62	%
Non-performing loans as a percent of total loans		0.79	%		0.75	%		1.00	%		0.86	%		0.76	%
Allowance for loan losses as a percent of total loans		0.99	%(3)		0.99	%(3)		0.96	%(3)		0.96	%(3)		0.95	%(3)
Allowance for loan losses as a percent of non-performing loans		125.65	%		131.68	%		96.22	%		112.01	%		125.20	%
Average Balances
Loans	$	1,133,543		$	1,119,511		$	1,113,672		$	1,103,305		$	1,090,796
Securities		338,405			346,939			358,929			356,479			341,804
Total interest-earning assets		1,526,015			1,509,079			1,503,940			1,509,438			1,493,946
Total assets		1,628,071			1,611,447			1,605,844			1,602,767			1,579,048
Deposits		1,231,285			1,211,957			1,186,530			1,179,166			1,145,296
FHLBB advances		105,302			111,762			132,544			138,215			147,880
Stockholders’ Equity		227,854			227,678			228,278			226,279			223,067
Average Yields/Rates (annualized)
Loans		4.97	%		5.18	%		5.22	%		5.33	%		5.31	%
Securities		3.37	%		3.34	%		3.62	%		3.80	%		3.73	%
Total interest-earning assets		4.45	%		4.62	%		4.73	%		4.80	%		4.74	%
Savings accounts		0.58	%		0.69	%		0.71	%		0.76	%		0.77	%
Money market/NOW accounts		0.55	%		0.62	%		0.64	%		0.70	%		0.71	%
Certificates of deposit		1.82	%		1.88	%		1.91	%		1.99	%		2.06	%
FHLBB advances		3.12	%		3.17	%		3.26	%		3.60	%		3.52	%
Total interest-bearing liabilities		1.31	%		1.43	%		1.50	%		1.61	%		1.68	%

(1) Excludes gains/losses on sales of securities and loans and impairment charges on securities.

(2) Excludes the impact of goodwill and other intangible assets of $8.9 million at March 31, 2012 and December 31, 2011, $9.0 million at September 30, 2011 and $9.2 million at June 30, 2011 and March 31, 2011.

(3) Excluding acquired loans of $136.4 million, $146.0 million, $156.2 million, $168.6 million and $178.7 million and loans purchased from other financial institutions of $18.3 million, $19.1 million, $19.3 million, $20.8 million and $21.1 million at March 31, 2012, December 31, 2011, September 30, 2011, June 30, 2011 and March 31, 2011, respectively, allowance for loan losses as a percent of total loans, gross would have been 1.15%, 1.16%, 1.14%, 1.16%, and 1.17% for the quarters ended March 31, 2012, December 31, 2011, September 30, 2011, June 30, 2011 and March 31, 2011, respectively.