Century Bancorp (CNBKA) 8-K Results of Operations and Financial Condition

Exhibit 99.1

NEWS RELEASE

FOR IMMEDIATE RELEASE

Contact:	William P. Hornby, CPA
	whornby@centurybank.com
Phone:	781-393-4630
Fax:	781-393-4071

CENTURY BANCORP, INC. ANNOUNCES 4TH CONSECUTIVE YEAR OF RECORD EARNINGS FOR 2013, UP 5%; ASSET GROWTH OF 11% TO RECORD SIZE OF $3.4 BB; REGULAR DIVIDEND DECLARED

Medford, MA, January 21, 2014—Century Bancorp, Inc. (NASDAQ:CNBKA) (www.centurybank.com) (“the Company”) today announced net income of $20,046,000 for the year ended December 31, 2013, or $3.61 per Class A share diluted, an increase of 5.3% compared to net income of $19,039,000, or $3.43 per Class A share diluted, for the same period a year ago. Total assets increased 11.2% from $3.1 billion at December 31, 2012 to $3.4 billion at December 31, 2013. For the quarter ended December 31, 2013, net income totaled $5,025,000, or $0.90 per Class A share diluted, an increase of 5.2% compared to net income of $4,778,000, or $0.86 per Class A share diluted, for the same period a year ago.

Net interest income totaled $61.0 million for the year ended December 31, 2013 compared to $62.0 million for the same period in 2012. The 1.6% decrease in net interest income for the period is primarily due to $3.3 million of prepayment penalties collected during 2012 compared to $491,000 for 2013. The net interest margin decreased from 2.51% 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 13.6% increase in the average balances of earning assets, combined with a similar increase in average deposits.

The provision for loan losses decreased by $1.4 million from $4.2 million for the year ended December 31, 2012 to $2.7 million for the year ended December 31, 2013, primarily as a result of a lower level of charge-off activity and changes in portfolio composition. The Company capitalized on favorable market conditions for the year ended December 31, 2013 and realized net gains on sales of investments of $3.0 million, as compared to $1.8 million for the same period in 2012. The Company’s effective tax rate decreased from 6.8% in 2012 to 4.8% in 2013 primarily as a result of an increase in tax-exempt income.

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At December 31, 2013, total equity was $176.5 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 and securities transferred from available-for-sale to held-to-maturity, offset, somewhat, by a decrease in the additional pension liability, net of taxes. Unrealized losses increased as a result of increases in interest rates. 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 additional pension liability decreased mainly as a result of an increase in pension assets and decrease in the projected benefit obligation on the defined benefit pension plan.

The Company’s leverage ratio stood at 6.50% at December 31, 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 December 31, 2013 was $31.76 per share compared to $32.40 at December 31, 2012.

The Company’s allowance for loan losses was $20.9 million or 1.66% of loans outstanding at December 31, 2013, compared to $19.2 million or 1.73% of loans outstanding at December 31, 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 $2.5 million at December 31, 2013, compared to $4.5 million at December 31, 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 February 18, 2014 to stockholders of record on February 3, 2014.

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, 2013		December 31, 2012
Assets
Cash and Due From Banks	$	59,956	$	53,646
Federal Funds Sold and Interest-bearing Deposits In Other Banks		34,722		98,637
Short-term Investments		4,617		17,367
Securities Available-For-Sale (AFS)		464,245		1,434,801
Securities Held-to-Maturity		1,487,884		275,507
Federal Home Loan Bank of Boston stock, at cost		18,072		15,146
Loans:
Commercial & Industrial		92,402		88,475
Construction & Land Development		33,058		38,618
Commercial Real Estate		713,327		576,465
Residential Real Estate		286,041		281,857
Consumer and Other		9,658		7,450
Home Equity		130,277		118,923
Total Loans		1,264,763		1,111,788
Less: Allowance for Loan Losses		20,941		19,197
Net Loans		1,243,822		1,092,591
Bank Premises and Equipment		23,400		23,899
Accrued Interest Receivable		6,539		5,811
Goodwill		2,714		2,714
Other Assets		85,183		66,090
Total Assets	$	3,431,154	$	3,086,209
Liabilities
Demand Deposits	$	475,862	$	438,429
Interest Bearing Deposits:
Savings and NOW Deposits		992,796		933,316
Money Market Accounts		864,957		653,345
Time Deposits		382,224		419,983
Total Interest Bearing Deposits		2,239,977		2,006,644
Total Deposits		2,715,839		2,445,073
Borrowed Funds:
Securities Sold Under Agreements to Repurchase		214,440		191,390
Other Borrowed Funds		255,144		195,144
Total Borrowed Funds		469,584		386,534
Other Liabilities		33,176		38,529
Subordinated Debentures		36,083		36,083
Total Liabilities		3,254,682		2,906,219
Total Stockholders’ Equity		176,472		179,990
Total Liabilities & Stockholders’ Equity	$	3,431,154	$	3,086,209

Century Bancorp, Inc. and Subsidiaries

Consolidated Comparative Statements of Income (unaudited)

For the Quarter and Year ended December 31, 2013 and 2012

(in thousands)

	Quarter ended December 31,				Year ended December 31,
	2013		2012		2013		2012
Interest Income:
Loans	$	12,562	$	12,301	$	49,296	$	51,415
Securities Held-to-Maturity		7,495		1,615		16,615		6,746
Securities Available-for-Sale		789		5,649		13,369		22,703
Federal Funds Sold and Interest-bearing Deposits In Other Banks		101		173		485		630
Total Interest Income		20,947		19,738		79,765		81,494
Interest Expense:
Savings and NOW Deposits		652		601		2,585		2,250
Money Market Accounts		677		540		2,472		2,373
Time Deposits		1,120		1,476		4,777		6,250
Securities Sold Under Agreements to Repurchase		93		93		361		367
Other Borrowed Funds and Subordinated Debentures		2,300		2,085		8,610		8,300
Total Interest Expense		4,842		4,795		18,805		19,540
Net Interest Income		16,105		14,943		60,960		61,954
Provision For Loan Losses		460		900		2,710		4,150
Net Interest Income After
Provision for Loan Losses		15,645		14,043		58,250		57,804
Other Operating Income
Service Charges on Deposit Accounts		2,073		1,993		8,113		7,880
Lockbox Fees		733		705		3,079		2,930
Net Gain on Sales of Investments		354		724		3,019		1,843
Net Gain on Sales of Loans		326		1		1,564		297
Other Income		700		730		2,840		2,915
Total Other Operating Income		4,186		4,153		18,615		15,865
Operating Expenses
Salaries and Employee Benefits		9,386		8,211		35,244		32,943
Occupancy		1,285		1,236		5,000		4,695
Equipment		552		501		2,298		2,255
FDIC Assessment		478		435		1,790		1,737
Other		2,989		2,896		11,480		11,608
Total Operating Expenses		14,690		13,279		55,812		53,238
Income Before Income Taxes		5,141		4,917		21,053		20,431
Income Tax Expense		116		139		1,007		1,392
Net Income	$	5,025	$	4,778	$	20,046	$	19,039

Century Bancorp, Inc. and Subsidiaries

Consolidated Year-to-Date Average Comparative Statements of Condition (unaudited)

(in thousands)

	December 31, 2013			December 31, 2012
Assets
Cash and Due From Banks	$	59,603		$	54,572
Federal Funds Sold and Interest-Bearing Deposits in Other Banks		174,264			219,540
Securities Available-For-Sale (AFS)		997,983			1,263,375
Securities Held-to-Maturity (HTM)		812,448			270,525
Total Loans		1,184,912			1,036,296
Less: Allowance for Loan Losses		20,452			18,039
Net Loans		1,164,460			1,018,257
Unrealized (Loss) Gain on Securities AFS and HTM Transfers		(6,236	)		18,362
Bank Premises and Equipment		23,551			22,804
Accrued Interest Receivable		6,247			6,091
Goodwill		2,714			2,714
Other Assets		81,121			68,205
Total Assets	$	3,316,155		$	2,944,445
Liabilities
Demand Deposits	$	441,193		$	386,863
Interest Bearing Deposits:
Savings and NOW Deposits		1,037,320			870,046
Money Market Accounts		800,052			666,949
Time Deposits		387,514			418,789
Total Interest Bearing Deposits		2,224,886			1,955,784
Total Deposits		2,666,079			2,342,647
Borrowed Funds:
Securities Sold Under Agreements to Repurchase		203,888			174,624
Other Borrowed Funds		194,949			181,459
Total Borrowed Funds		398,837			356,083
Other Liabilities		42,017			37,497
Subordinated Debentures		36,083			36,083
Total Liabilities		3,143,016			2,772,310
Total Stockholders’ Equity		173,139			172,135
Total Liabilities & Stockholders’ Equity	$	3,316,155		$	2,944,445
Total Average Earning Assets - QTD	$	3,342,186		$	2,938,890
Total Average Earning Assets - YTD	$	3,169,607		$	2,789,736

Century Bancorp, Inc. and Subsidiaries

Consolidated Selected Key Financial Information (unaudited)

(in thousands, except share data)

		December 31, 2013			December 31, 2012
Performance Measures:
Earnings per average Class A share, diluted, quarter		$	0.90		$	0.86
Earnings per average Class A share, diluted, year-to-date		$	3.61		$	3.43
Return on average assets, year-to-date			0.60	%		0.65	%
Return on average stockholders’ equity, year-to-date	��		11.58	%		11.06	%
Net interest margin (taxable equivalent), quarter			2.20	%		2.30	%
Net interest margin (taxable equivalent), year-to-date			2.21	%		2.51	%
Efficiency ratio, year-to-date			63.0	%		62.1	%
Book value per share		$	31.76		$	32.40
Tangible book value per share		$	31.27		$	31.91
Tangible capital / tangible assets			5.07	%		5.75	%
Common Share Data:
Average Class A shares outstanding, diluted, quarter			5,557,419			5,552,121
Average Class A shares outstanding, diluted, year-to-date			5,557,693			5,549,191
Shares outstanding Class A			3,580,404			3,568,079
Shares outstanding Class B			1,976,180			1,986,880
Total shares outstanding at period end			5,556,584			5,554,959
Asset Quality and Other Data:
Allowance for loan losses / loans			1.66	%		1.73	%
Nonaccrual loans		$	2,549		$	4,471
Nonperforming assets		$	2,549		$	4,471
Loans 90 days past due and still accruing		$	—		$	—
Accruing troubled debt restructures		$	5,969		$	3,048
Net charge-offs, year-to-date		$	966		$	1,527
Leverage ratio			6.50	%		6.80	%
Tier 1 risk weighted capital ratio			13.67	%		14.34	%
Total risk weighted capital ratio			14.92	%		15.59	%
Total risk weighted assets		$	1,660,881		$	1,462,197