Exhibit 99.1
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FOR IMMEDIATE RELEASE For More Information Contact:
Dena M. Hall
Assistant Vice President
(413) 787-1700
UNITED FINANCIAL BANCORP, INC. ANNOUNCES SECOND QUARTER EARNINGS
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WEST SPRINGFIELD, MA--July 28, 2005--United Financial Bancorp, Inc. (the
"Company") (NASDAQ:UBNK), the holding company for United Bank (the "Bank"),
reported that net income grew to $1.6 million, an increase of 19.2%, for the
three months ended June 30, 2005 compared to net income of $1.3 million for the
same quarter last year. The increase primarily resulted from growth in net
interest income and non-interest income, partially offset by a higher provision
for loan losses and higher non-interest expense.
Total assets increased $180.7 million, or 23.4%, to $952.7 million at June 30,
2005 from $772.0 million at December 31, 2004. The increase reflected growth of
$58.5 million in securities available for sale and $96.4 million in cash
received for stock subscriptions in the Company's recent initial public offering
which was invested in short term deposits. Total net loans increased to $588.1
million from $569.2 million at December 31, 2004, fueled largely by increases in
residential mortgage loans, reflecting continued demand for these products and
solid loan origination activity. The growth in assets was funded by $116.5
million in subscriptions for the initial public offering, a $41.3 million
increase in deposits and a $16.9 million increase in Federal Home Loan Bank
advances.
"United Financial Bancorp, Inc. had an exciting second quarter as we completed
our initial public offering and prepared for shares of UBNK stock to begin
trading on the NASDAQ National Market," said Richard B. Collins, President and
Chief Executive Officer. "We are pleased to announce solid second quarter
results fueled by strong loan and deposit growth as well as a modest increase in
fee income. With the stock offering behind us, we can now focus all of our
efforts on growing our franchise. We remain committed to serving the needs of
our customers and enhancing shareholder value." he said.
Financial Highlights Include:
o Net loan growth was driven primarily by one-to-four family residential
mortgage loans which increased $22.3 million, or 6.7%, to $353.1
million at June 30, 2005 compared to $330.8 million at December 31,
2004.
o Asset quality remained strong with delinquencies at .87% of total
loans and non-performing loans at .30% of total assets at June 30,
2005 compared to .98% and .32% respectively at June 30, 2004.
o At June 30, 2005 the allowance for loan losses to total loans was
1.05% and the allowance for loan losses to non-performing loans was
216%. The provision for loan losses increased $879,000, or 16.5%, from
the quarter ended June 30, 2004 due to an increase in the portfolio of
commercial real estate loans and commercial and industrial loans, and
higher adversely classified loans and non-performing loans at June 30,
2005 as compared to June 30, 2004.
o Deposits increased to $655.0 million. Core deposit growth was
approximately 5.9% for the six months ended June 30, 2005, due to our
continued emphasis on lower-cost core deposit balances.
o Net interest income before provision for loan losses increased
$599,000, or 10.0%, to $6.6 million for the three months ended June
30, 2005 compared to the three months ended June 30, 2004. The
increase reflected a $76.0 million, or 10.5%, increase in the average
balance of total interest earning assets to $802.9 million for the
three months ended June 30, 2005, which more than offset a 13 basis
point decrease in our interest rate spread to 2.87% from 3.00%. For
the six months ended June 30, 2005, our interest rate spread decreased
to 2.95% from 3.05% for the comparable period of 2004.
o Non-interest income increased $88,000, or 7.5%, to $1.3 million for
the three months ended June 30, 2005 compared to the same period last
year reflecting modest growth in fee income.
o Non-interest expense increased 2.0% to $4.9 million for the three
months ended June 30, 2005 from $4.8 million for the prior year
period. The increase reflected salary and employee benefits increases
as well as increased staffing. Non-interest expense in 2004 included
expenses related to the conversion of United Bank to a federal
charter.
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 National Market under the symbol UBNK. United Bank provides an array of
financial products and services through its 11 branch offices located throughout
Western Massachusetts. Through its Financial Services Group, the Bank offers
access to a wide range of investment and insurance products and services, as
well as financial, estate and retirement planning. For more information
regarding the Bank's products and services and for United Financial Bancorp,
Inc. investor relations information please visit www.bankatunited.com.
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.
Attached are consolidated balance sheets and consolidated statements of
operations.
UNITED FINANCIAL BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CONDITION (unaudited)
(Dollars in Thousands)
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June 30, December 31,
2005 2004
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ASSETS
Cash and due from banks.................................................... $ 15,687 $ 15,772
Interest bearing deposits.................................................. 103,625 7,180
Liquidity and cash funds................................................... 4,223 281
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Total cash and cash equivalents...................................... 123,535 23,233
Securities available for sale, at market value............................. 210,859 152,329
Securities to be held to maturity, at amortized cost (fair value $3,379
in 2005 and $2,498 in 2004)............................................. 3,380 2,498
Loans, net of allowance for loan losses of $6,214 in 2005 and $5,750
in 2004................................................................. 588,104 569,243
Banking premises and equipment, net........................................ 7,710 7,671
Accrued interest receivable................................................ 3,455 2,862
Deferred tax asset......................................................... 1,587 1,551
Stock in the Federal Home Loan Bank of Boston.............................. 6,175 6,021
Bank-owned life insurance.................................................. 5,867 5,705
Other assets............................................................... 2,015 895
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TOTAL ASSETS......................................................... $ 952,687 $ 772,008
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LIABILITIES AND STOCKHOLDER'S EQUITY
Liabilities:
Deposits:
Interest bearing......................................................... $ 565,818 $ 527,426
Non-interest bearing..................................................... 89,167 86,246
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Total deposits....................................................... 654,985 613,672
Federal Home Loan Bank of Boston advances................................ 103,630 86,694
Subscriptions payable.................................................... 116,547 --
Repurchase agreements.................................................... 7,970 4,317
Escrow funds held for borrowers.......................................... 924 954
Accrued expenses and other liabilities................................... 3,748 4,116
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Total liabilities.................................................... 887,804 709,753
Commitments and contingencies............................................
Stockholder's equity:
Preferred stock, par value $0.01 per share, authorized 5,000,000 shares;
none issued............................................................ -- --
Common stock, par value $0.01 per share, authorized 60,000,000 shares;
100 shares issued in 2004 and 2005..................................... -- --
Paid-in capital.......................................................... -- --
Retained earnings........................................................ 65,632 62,667
Accumulated other comprehensive loss..................................... (749) (412)
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Total stockholder's equity........................................... 64,883 62,255
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TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY........................... $ 952,687 $ 772,008
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UNITED FINANCIAL BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF EARNINGS (unaudited)
(Dollars in Thousands)
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Three Months Ended Six Months Ended
June 30, June 30,
2005 2004 2005 2004
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Interest and dividend income:
Loans...................................................... $ 8,418 $ 7,197 $ 16,525 $ 14,273
Investment interest and dividends.......................... 1,859 1,473 3,387 3,314
Other interest-earning assets.............................. 115 239 256 280
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Total interest and dividend income...................... 10,392 8,909 20,168 17,867
Interest expense:
Interest on deposits....................................... 2,901 2,194 5,481 4,430
Interest on short-term borrowings.......................... 228 75 322 154
Interest on long-term debt................................. 690 666 1,385 1,285
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Total interest expense.................................. 3,819 2,935 7,188 5,869
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Net interest income before provision for loan losses.... 6,573 5,974 12,980 11,998
Provision for loan losses.................................... 275 113 550 225
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Net interest income after provision for loan losses..... 6,298 5,861 12,430 11,773
Non-interest income:
Fee income on depositors' accounts......................... 1,005 889 1,908 1,677
Gain on sale of loans...................................... -- 1 -- 10
Net gain on sale of securities............................. -- 2 -- 112
Income from bank-owned life insurance...................... 81 75 162 150
Other income .............................................. 175 206 357 372
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Total non-interest income............................... 1,261 1,173 2,427 2,321
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Non-interest expense:
Salaries and employee benefits............................. 2,346 1,991 5,101 4,536
Occupancy expense.......................................... 399 437 739 848
Advertising expenses....................................... 335 394 680 618
Data processing expenses................................... 645 645 1,391 1,262
Professional fees.......................................... 108 50 219 143
Other expenses............................................. 1,064 1,282 1,796 2,361
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Total non-interest expense.............................. 4,897 4,799 9,926 9,768
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Income before income taxes.............................. 2,662 2,235 4,931 4,326
Income tax expense........................................... 1,063 893 1,966 1,723
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NET INCOME.............................................. $ 1,599 $ 1,342 $ 2,965 $ 2,603
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