CNBKA Century BanCorp Inc

Century Bancorp, Inc. (NASDAQ:CNBKA) (www.centurybank.com) (“the Company”) today announced net income of $24,534,000 for the year ended December 31, 2016, or $4.41 per Class A share diluted, an increase of 6.6% compared to net income of $23,021,000, or $4.13 per Class A share diluted, for the same period a year ago. Total assets increased 13.1% from $3.9 billion at December 31, 2015 to $4.5 billion at December 31, 2016. For the quarter ended December 31, 2016, net income totaled a record $6,500,000 or $1.17 per Class A share diluted, an increase of 8.9% compared to net income of $5,971,000, or $1.07 per Class A share diluted, for the same period a year ago.

Net interest income totaled $74.1 million for the year ended December 31, 2016 compared to $70.0 million for the same period in 2015. The 5.9% increase in net interest income for the period is primarily due to an increase in average earning assets. The net interest margin decreased from 2.18% on a fully taxable equivalent basis in 2015 to 2.12% for the same period in 2016. This was primarily the result of a decrease in rates on earning assets. The average balances of earning assets increased by 10.3% combined with a similar increase in average deposits. Also, interest expense increased 12.3% as a result of an increase in deposit balances.

The provision for loan losses increased by $1,175,000 from $200,000 for the year ended December 31, 2015 to $1,375,000 for the same period in 2016, primarily as a result of an increase in loan balances. The Company’s effective tax rate decreased from 2.3% in 2015 to (1.5%) in 2016 primarily as a result of an increase in tax-exempt income.

At December 31, 2016, total equity was $240.0 million compared to $214.5 million at December 31, 2015. 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 primarily as a result of a decrease in unrealized losses on securities transferred from available-for-sale to held-to-maturity and amortization of the pension liability. This was offset, somewhat, by an increase in unrealized losses on securities available-for-sale.

The Company’s leverage ratio stood at 6.28% at December 31, 2016, compared to 6.79% at December 31, 2015. 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 December 31, 2016 was $43.11 per share compared to $38.53 at December 31, 2015.

The Company’s allowance for loan losses was $24.4 million or 1.27% of loans outstanding at December 31, 2016, compared to $23.1 million or 1.33% of loans outstanding at December 31, 2015. The change in the ratio of the allowance for loan losses to loans outstanding, when compared to December 31, 2015, was primarily due to changes in portfolio composition and lower historical loss rates. Non-performing assets totaled $1.1 million at December 31, 2016, compared to $2.3 million at December 31, 2015.

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 15, 2017 to stockholders of record on February 1, 2017.

The Company, through its subsidiary bank, Century Bank and Trust Company, a state chartered full service commercial bank, operating twenty-seven 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

2016 2015 Cash and Due From Banks $ 62,400 $ 52,877 Federal Funds Sold and Interest-bearing Deposits In Other Banks 173,751 167,847   Short-term Investments 3,183 3,233   Securities Available-for-Sale (AFS) 499,297 404,623   Securities Held-to-Maturity 1,653,986 1,438,903   Federal Home Loan Bank of Boston stock, at cost 21,042 28,807   Loans: Commercial & Industrial 612,503 452,235 Municipal 135,418 85,685 Construction & Land Development 14,928 27,421 Commercial Real Estate 696,173 721,506 Residential Real Estate 241,357 255,346 Consumer and Other 11,697 11,323 Home Equity   211,857   178,020   Total Loans 1,923,933 1,731,536 Less: Allowance for Loan Losses   24,406   23,075   Net Loans 1,899,527 1,708,461   Bank Premises and Equipment, net 23,417 24,106 Accrued Interest Receivable 9,645 8,002 Goodwill 2,714 2,714 Other Assets   113,646   107,868   Total Assets $ 4,462,608 $ 3,947,441  

Liabilities

Demand Deposits $ 689,286 $ 541,955   Interest Bearing Deposits: Savings and NOW Deposits 1,304,394 1,070,585 Money Market Accounts 1,181,179 989,094 Time Deposits   478,359   473,426   Total Interest Bearing Deposits   2,963,932   2,533,105   Total Deposits 3,653,218 3,075,060   Borrowed Funds: Securities Sold Under Agreements to Repurchase 182,280 197,850 Other Borrowed Funds   293,000   368,000   Total Borrowed Funds 475,280 565,850   Other Liabilities 57,986 55,904 Subordinated Debentures   36,083   36,083   Total Liabilities 4,222,567 3,732,897   Total Stockholders' Equity   240,041   214,544   Total Liabilities & Stockholders' Equity $ 4,462,608 $ 3,947,441                 Century Bancorp, Inc. and Subsidiaries Consolidated Comparative Statements of Income (unaudited) For the Quarter and Year ended December 31, 2016 and 2015 (in thousands)   Quarter ended December 31, Year ended December 31, 2016     2015 2016     2015   Interest Income: Loans $ 14,384 $ 13,531 $ 57,764 $ 52,128 Securities Held-to-Maturity 8,501 8,015 32,679 34,388 Securities Available-for-Sale 1,474 842 5,020 3,141 Federal Funds Sold and Interest-bearing Deposits In Other Banks   330   108   1,236   436   Total Interest Income 24,689 22,496 96,699 90,093   Interest Expense: Savings and NOW Deposits 1,161 768 4,020 2,817 Money Market Accounts 1,057 762 3,542 3,038 Time Deposits 1,490 1,293 5,706 4,887 Securities Sold Under Agreements to Repurchase 109 116 472 487 Other Borrowed Funds and Subordinated Debentures   2,110   2,335   8,877   8,905   Total Interest Expense   5,927   5,274   22,617   20,134   Net Interest Income 18,762 17,222 74,082 69,959   Provision For Loan Losses   200   -   1,375   200   Net Interest Income After Provision for Loan Losses 18,562 17,222 72,707 69,759   Other Operating Income Service Charges on Deposit Accounts 2,025 1,944 7,907 7,732 Lockbox Fees 733 753 3,164 3,211 Net Gain on Sales of Investments - 424 64 594 Net Gain on Sales of Loans - 292 1,331 1,034 Other Income   942   1,035   3,756   3,422   Total Other Operating Income 3,700 4,448 16,222 15,993   Operating Expenses Salaries and Employee Benefits 9,688 9,895 40,048 38,596 Occupancy 1,508 1,495 6,147 6,116 Equipment 758 677 2,845 2,626 FDIC Assessment 399 550 1,902 2,152 Other   3,803   3,177   13,815   12,708   Total Operating Expenses   16,156   15,794   64,757   62,198   Income Before Income Taxes 6,106 5,876 24,172 23,554   Income Tax (Benefit) Expense   (394)   (95)   (362)   533   Net Income $ 6,500 $ 5,971 $ 24,534 $ 23,021  

Century Bancorp, Inc. and Subsidiaries

Consolidated Year-to-Date Average Comparative Statements of Condition (unaudited) (in thousands)         December 31, December 31,

Assets

2016 2015 Cash and Due From Banks $ 71,023 $ 67,700 Federal Funds Sold and Interest-Bearing Deposits in Other Banks 235,339 157,765   Securities Available-For-Sale (AFS) 498,654 454,638 Securities Held-to-Maturity (HTM) 1,533,032 1,603,530   Total Loans 1,838,136 1,507,546 Less: Allowance for Loan Losses   23,872     22,559     Net Loans 1,814,264 1,484,987   Unrealized (Loss)Gain on Securities AFS and HTM Transfers (9,504 ) (14,430 ) Bank Premises and Equipment 23,656 24,261 Accrued Interest Receivable 8,390 7,537 Goodwill 2,714 2,714 Other Assets   113,924     103,918     Total Assets $ 4,291,492   $ 3,892,620    

Liabilities

Demand Deposits $ 609,159 $ 518,161   Interest Bearing Deposits: Savings and NOW Deposits 1,322,714 1,139,449 Money Market Accounts 1,041,404 951,197 Time Deposits   452,562     408,711   Total Interest Bearing Deposits   2,816,680     2,499,357     Total Deposits 3,425,839 3,017,518   Borrowed Funds: Securities Sold Under Agreements to Repurchase 222,956 245,276 Other Borrowed Funds   321,891     338,025     Total Borrowed Funds 544,847 583,301   Other Liabilities 57,602 51,247 Subordinated Debentures   36,083     36,083     Total Liabilities 4,064,371 3,688,149   Total Stockholders' Equity   227,121     204,471     Total Liabilities & Stockholders' Equity $ 4,291,492   $ 3,892,620     Total Average Earning Assets - QTD $ 4,287,001   $ 3,771,711     Total Average Earning Assets - YTD $ 4,105,161   $ 3,723,479           Century Bancorp, Inc. and Subsidiaries Consolidated Selected Key Financial Information (unaudited) (in thousands, except share data) December 31, December 31, 2016 2015  

Performance Measures:

  Earnings per average Class A share, diluted, quarter $ 1.17 $ 1.07 Earnings per average Class A share, diluted, year $ 4.41 $ 4.13 Return on average assets, year 0.57 % 0.59 % Return on average stockholders' equity, year 10.80 % 11.26 % Net interest margin (taxable equivalent), quarter 2.04 % 2.12 % Net interest margin (taxable equivalent), year 2.12 % 2.18 % Efficiency ratio, year - Non-GAAP (1) 62.7 % 64.1 % Book value per share $ 43.11 $ 38.53 Tangible book value per share - Non-GAAP (1) $ 42.62 $ 38.04 Capital / assets 5.38 % 5.44 % Tangible capital / tangible assets - Non-GAAP (1) 5.32 % 5.37 %     Common Share Data: Average Class A shares outstanding, diluted, quarter & year 5,567,909 5,567,909   Shares outstanding Class A 3,600,729 3,600,729 Shares outstanding Class B   1,967,180     1,967,180   Total shares outstanding at period end   5,567,909     5,567,909      

Asset Quality and Other Data:

  Allowance for loan losses / loans 1.27 % 1.33 % Nonaccrual loans $

1,084

$ 2,336 Nonperforming assets $

1,084

$ 2,336 Loans 90 days past due and still accruing $ - $ - Accruing troubled debt restructures $ 3,526 $ 2,893 Net (recoveries)charge-offs, year-to-date $ (45 ) $ (557 )   Leverage ratio 6.28 % * 6.79 % * Common equity tier 1 risk weighted capital ratio 10.41 % * 10.04 % * Tier 1 risk weighted capital ratio 11.70 % * 11.55 % * Total risk weighted capital ratio 12.72 % * 12.54 % * Total risk weighted assets $ 2,398,796 * $ 2,325,258 *   * computed utilizing Basel III regulatory capital framework.   (1) Non-GAAP Financial Measures are reconciled in the following tables:   Calculation of Efficiency ratio:   Total operating expenses(numerator) $ 64,757   $ 62,198     Net interest income $ 74,082 $ 69,959 Total other operating income 16,222 15,993 Tax equivalent adjustment   12,917     11,140   Total income(denominator) $ 103,221   $ 97,092     Efficiency ratio, year - Non-GAAP       62.7 %         64.1 %   Calculation of tangible book value per share:   Total stockholders' equity $ 240,041 $ 214,544 Less: goodwill   2,714     2,714   Tangible stockholders' equity(numerator) $ 237,327   $ 211,830     Total shares outstanding at period end(denominator) 5,567,909 5,567,909   Tangible book value per share - Non-GAAP     $ 42.62         $ 38.04   Book value per share - GAAP     $ 43.11         $ 38.53     Calculation of tangible capital / tangible assets:   Total stockholders' equity $ 240,041 $ 214,544 Less: goodwill   2,714     2,714   Tangible stockholders' equity(numerator) $ 237,327   $ 211,830     Total assets $ 4,462,608 $ 3,947,441 Less: goodwill   2,714     2,714   Tangible assets(denominator) $ 4,459,894   $ 3,944,727     Tangible capital / tangible assets - Non-GAAP       5.32 %         5.37 % Capital / assets - GAAP         5.38 %         5.44 %

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