Century Bancorp, Inc. (NASDAQ:CNBKA) (www.centurybank.com) (“the
Company”) today announced net income of $42,209,000 for the year
ended December 31, 2020, or $7.58 per Class A share diluted, an
increase of 6.3% compared to net income of $39,699,000, or $7.13
per Class A share diluted, for the same period a year ago. Total
assets increased 15.8% from $5.49 billion at December 31, 2019 to
$6.36 billion at December 31, 2020. For the quarter ended December
31, 2020, net income totaled $11,600,000 or $2.08 per Class A share
diluted, an increase of 8.1% compared to net income of $10,732,000,
or $1.93 per Class A share diluted, for the same period a year
ago.
The Company's Board of Directors voted to increase its regular
quarterly dividend from 16.00 cents ($0.16) per share to 18.00
cents ($0.18) per share on the Company's Class A common stock, and
from 8.00 cents ($0.08) per share to 9.00 cents ($0.09) per share
on the Company's Class B common stock. The dividends were declared
payable February 16, 2021 to stockholders of record on February 1,
2021.
Net interest income totaled $106.8 million for the year ended
December 31, 2020 compared to $95.8 million for the same period in
2019. The 11.5% increase in net interest income for the period is
primarily due to a decrease in interest expense as a result of
falling interest rates. The net interest margin decreased from
2.10% on a fully tax-equivalent basis for 2019 to 2.00% for 2020.
This was primarily the result of increased margin pressure during
the recent decrease in interest rates across the yield curve. The
average balances of earning assets increased for 2020 compared to
the same period last year, by $719.9 million or 14.4%, combined
with an average yield decrease of 0.63%, resulting in a decrease in
interest income of $10.1 million. The average balance of
interest-bearing liabilities increased for 2020 compared to the
same period last year, by $568.3 million or 14.0%, combined with an
average interest-bearing liabilities interest cost decrease of
0.65%, resulting in a decrease in interest expense of $21.1
million.
The provision for loan losses increased by $4,575,000 from
$1,250,000 for the year ended December 31, 2019 to $5,825,000 for
2020, primarily as a result of the economic uncertainties
associated with the novel coronavirus disease (COVID–19) pandemic
and increased loan balances.
The Company’s effective tax rate increased from 2.7% for the
year ended December 31, 2019 to 9.5% for the same period in 2020.
This was primarily as a result of an increase in taxable income
relative to total income and a reduction in tax accruals, during
2019, related to sequestration of the refundable portion of our
alternative minimum tax (AMT) credit carryforward, offset by an
increase in life insurance proceeds received. On January 14, 2019,
the IRS updated its announcement “Effect of Sequestration on the
Alternative Minimum Tax Credit for Corporations” to clarify that
refundable AMT credits under Section 53(e) of the Internal Revenue
Code are not subject to sequestration for taxable years beginning
after December 31, 2017. On March 27, 2020, the Coronavirus, Aid,
Relief and Economic Security (CARES) Act was signed into law. As a
result of the CARES Act, the full balance of the AMT credit was
refunded in 2020.
At December 31, 2020, total equity was $370.4 million compared
to $332.6 million at December 31, 2019. The Company’s equity
increased primarily as a result of earnings, offset somewhat by
dividends paid and an increase in total accumulated other
comprehensive loss.
The Company’s leverage ratio stood at 6.64% at December 31,
2020, compared to 7.25% at December 31, 2019. 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, 2020 was $66.53 per share compared to $59.73 at
December 31, 2019.
The Company’s allowance for loan losses was $35.5 million or
1.18% of loans outstanding at December 31, 2020 compared to $29.6
million or 1.22% of loans outstanding at December 31, 2019. The
ratio of the allowance for loan losses to loans outstanding has
decreased from December 31, 2019, primarily from approximately $196
million of qualifying Payroll Protection Program (PPP) loans that
are guaranteed by the U.S. Small Business Administration (SBA),
which require no allowance for loan losses. Nonperforming assets
totaled $4.0 million at December 31, 2020, compared to $2.0 million
at December 31, 2019.
As of December 31, 2020, the Company has COVID-19 modifications
of 20 loans aggregating $25,022,000, primarily consisting of
short-term payment deferrals. Of these modifications, $25,022,000,
or 100%, were performing in accordance with their modified
terms.
The CARES Act also allows companies to delay Financial
Accounting Standards Board (FASB) Accounting Standards Update (ASU)
2016-13, Measurement of Credit Losses on Financial Instruments
(CECL), including the current expected credit losses methodology
for estimating allowances for credit losses. The Company elected to
delay FASB ASU 2016-13. This ASU was delayed until the earlier of
the date on which the national emergency concerning the COVID–19
outbreak declared by the President on March 15, 2020 terminates or
December 31, 2020, with an effective retrospective implementation
date of January 1, 2020. On December 27, 2020, the Coronavirus
Response and Relief Supplemental Appropriations Act of 2021 was
signed into law. The law changed the delayed implementation date to
the earlier of the first day of the Company’s fiscal year that
begins after the date on which the national emergency terminates or
January 1, 2022.
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
2020
2019
Cash and Due From Banks
$
136,735
$
44,420
Federal Funds Sold and Interest-bearing Deposits In Other Banks
237,265
214,273
Securities Available-for-Sale (AFS)
284,116
262,190
Securities Held-to-Maturity
2,509,088
2,351,120
Federal Home Loan Bank of Boston stock, at cost
13,361
19,471
Loans: Commercial & Industrial
1,314,245
812,417
Municipal
137,607
120,455
Construction & Land Development
10,909
8,992
Commercial Real Estate
789,836
786,102
Residential Real Estate
448,436
371,897
Consumer and Other
20,439
21,893
Home Equity
274,357
304,363
Total Loans
2,995,829
2,426,119
Less: Allowance for Loan Losses
35,486
29,585
Net Loans
2,960,343
2,396,534
Bank Premises and Equipment, net
39,062
33,952
Accrued Interest Receivable
13,283
13,110
Goodwill
2,714
2,714
Other Assets
162,867
154,640
Total Assets
$
6,358,834
$
5,492,424
Liabilities Demand Deposits
$
1,103,878
$
712,842
Interest Bearing Deposits: Savings and NOW Deposits
1,728,092
1,678,250
Money Market Accounts
2,074,108
1,453,572
Time Deposits
546,143
555,447
Total Interest Bearing Deposits
4,348,343
3,687,269
Total Deposits
5,452,221
4,400,111
Borrowed Funds: Securities Sold Under Agreements to
Repurchase
232,090
266,045
Other Borrowed Funds
177,009
370,955
Total Borrowed Funds
409,099
637,000
Other Liabilities
91,022
86,649
Subordinated Debentures
36,083
36,083
Total Liabilities
5,988,425
5,159,843
Total Stockholders' Equity
370,409
332,581
Total Liabilities & Stockholders' Equity
$
6,358,834
$
5,492,424
Century Bancorp, Inc. and Subsidiaries Consolidated
Comparative Statements of Income (unaudited) For the quarter and
year ended December 31, 2020 and 2019 (in thousands) Quarter
ended December 31, Year ended December 31,
2020
2019
2020
2019
Interest Income: Loans
$
22,405
$
22,781
$
85,883
$
87,887
Securities Held-to-Maturity
13,371
15,030
58,072
58,036
Securities Available-for-Sale
745
1,860
4,238
9,165
Federal Funds Sold and Interest-bearing Deposits In Other Banks
96
847
843
4,051
Total Interest Income
36,617
40,518
149,036
159,139
Interest Expense: Savings and NOW Deposits
1,311
4,395
8,880
21,183
Money Market Accounts
2,922
5,365
15,012
21,170
Time Deposits
2,432
3,080
11,573
11,804
Securities Sold Under Agreements to Repurchase
200
775
1,376
2,347
Other Borrowed Funds and Subordinated Debentures
1,273
1,572
5,366
6,846
Total Interest Expense
8,138
15,187
42,207
63,350
Net Interest Income
28,479
25,331
106,829
95,789
Provision For Loan Losses
2,150
550
5,825
1,250
Net Interest Income After Provision for Loan Losses
26,329
24,781
101,004
94,539
Other Operating Income: Service Charges on Deposit Accounts
2,260
2,419
8,818
9,220
Lockbox Fees
895
955
3,745
3,973
Net Gain on Sales of Loans
-
258
-
412
Other Income
3,425
1,057
6,537
4,794
Total Other Operating Income
6,580
4,689
19,100
18,399
Operating Expenses: Salaries and Employee Benefits
12,283
11,393
45,303
44,014
Occupancy
1,592
1,560
6,040
6,246
Equipment
887
798
3,495
3,238
Other
5,344
4,461
18,650
18,631
Total Operating Expenses
20,106
18,212
73,488
72,129
Income Before Income Taxes
12,803
11,258
46,616
40,809
Income Tax Expense
1,203
526
4,407
1,110
Net Income
$
11,600
$
10,732
$
42,209
$
39,699
Century Bancorp, Inc. and Subsidiaries Consolidated
Year-to-Date Average Comparative Statements of Condition
(unaudited) (in thousands) December 31, December 31,
Assets
2020
2019
Cash and Due From Banks
$
91,121
$
75,025
Federal Funds Sold and Interest-Bearing Deposits in Other Banks
274,901
189,710
Securities Available-For-Sale (AFS)
295,474
313,604
Securities Held-to-Maturity (HTM)
2,372,491
2,152,580
Total Loans
2,774,069
2,341,190
Less: Allowance for Loan Losses
31,951
29,004
Net Loans
2,742,118
2,312,186
Unrealized (Loss)Gain on Securities AFS and HTM Transfers
(2,528
)
(3,198
)
Bank Premises and Equipment
36,735
27,867
Accrued Interest Receivable
12,863
13,752
Goodwill
2,714
2,714
Other Assets
166,097
134,704
Total Assets
$
5,991,986
$
5,218,944
Liabilities Demand Deposits
$
921,718
$
760,420
Interest Bearing Deposits: Savings and NOW Deposits
1,900,406
1,810,481
Money Market Accounts
1,708,674
1,273,389
Time Deposits
595,864
519,761
Total Interest Bearing Deposits
4,204,944
3,603,631
Total Deposits
5,126,662
4,364,051
Borrowed Funds: Securities Sold Under Agreements to
Repurchase
221,609
224,361
Other Borrowed Funds
165,573
195,843
Total Borrowed Funds
387,182
420,204
Other Liabilities
89,147
79,437
Subordinated Debentures
36,083
36,083
Total Liabilities
5,639,074
4,899,775
Total Stockholders' Equity
352,912
319,169
Total Liabilities & Stockholders' Equity
$
5,991,986
$
5,218,944
Total Average Earning Assets - QTD
$
6,150,592
$
5,100,333
Total Average Earning Assets - YTD
$
5,716,935
$
4,997,084
Century Bancorp, Inc. and Subsidiaries Consolidated Selected
Key Financial Information (unaudited) (in thousands, except share
data) December 31, December 31,
2020
2019
Performance Measures:
Earnings per average Class A share, diluted, quarter
$
2.08
$
1.93
Earnings per average Class A share, diluted, year
$
7.58
$
7.13
Return on average assets, year
0.70
%
0.76
%
Return on average stockholders' equity, year
11.96
%
12.44
%
Net interest margin (taxable equivalent), quarter
1.95
%
2.14
%
Net interest margin (taxable equivalent), year
2.00
%
2.10
%
Efficiency ratio, Non-GAAP (1)
55.2
%
58.4
%
Book value per share
$
66.53
$
59.73
Tangible book value per share - Non-GAAP (1)
$
66.04
$
59.24
Capital / assets
5.83
%
6.06
%
Tangible capital / tangible assets - Non-GAAP (1)
5.78
%
6.01
%
Common Share Data: Average Class A shares
outstanding, diluted, quarter and year
5,567,909
5,567,909
Shares outstanding Class A
3,655,469
3,650,949
Shares outstanding Class B
1,912,440
1,916,960
Total shares outstanding at period end
5,567,909
5,567,909
Asset Quality and Other
Data: Allowance for loan losses / loans
1.18
%
1.22
%
Nonaccrual loans
$
3,996
$
2,014
Nonperforming assets
$
3,996
$
2,014
Loans 90 days past due and still accruing
$
90
$
-
Accruing troubled debt restructures
$
2,202
$
2,361
Net charge-offs (recoveries), year
$
(76
)
$
208
Leverage ratio
6.64
%
7.25
%
Common equity tier 1 risk weighted capital ratio
11.39
%
11.80
%
Tier 1 risk weighted capital ratio
12.40
%
12.98
%
Total risk weighted capital ratio
13.43
%
13.97
%
Total risk weighted assets
$
3,458,416
$
2,976,650
(1) Non-GAAP Financial Measures are reconciled in
the following tables: Calculation of Efficiency
ratio: Total operating expenses
$
73,488
$
72,129
Less: other real estate owned expenses
-
134
Total adjusted operating expenses(numerator)
$
73,488
$
71,995
Net interest income
$
106,829
$
95,789
Total other operating income
19,100
18,399
Tax equivalent adjustment
7,280
9,068
Total income(denominator)
$
133,209
$
123,256
Efficiency ratio - Non-GAAP
55.2
%
58.4
%
Calculation of tangible book value per share:
Total stockholders' equity
$
370,409
$
332,581
Less: goodwill
2,714
2,714
Tangible stockholders' equity(numerator)
$
367,695
$
329,867
Total shares outstanding at period end(denominator)
5,567,909
5,567,909
Tangible book value per share - Non-GAAP
$
66.04
$
59.24
Book value per share - GAAP
$
66.53
$
59.73
Calculation of tangible capital / tangible assets:
Total stockholders' equity
$
370,409
$
332,581
Less: goodwill
2,714
2,714
Tangible stockholders' equity(numerator)
$
367,695
$
329,867
Total assets
$
6,358,834
$
5,492,424
Less: goodwill
2,714
2,714
Tangible assets(denominator)
$
6,356,120
$
5,489,710
Tangible capital / tangible assets - Non-GAAP
5.78
%
6.01
%
Capital / assets - GAAP
5.83
%
6.06
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210119005983/en/
William P. Hornby, CPA whornby@centurybank.com Phone:
781-393-4630 Fax: 781-393-4071
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