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New Hampshire Thrift Bancshares, Inc. Announces Earnings for Fiscal Year 2013

NEWPORT, NH--(Marketwired - Jan 31, 2014) -  New Hampshire Thrift Bancshares, Inc. (the "Company") (NASDAQ: NHTB), the holding company for Lake Sunapee Bank, fsb (the "Bank"), today reported consolidated net income for the twelve months ended December 31, 2013, of $8.4 million, or $1.11 per common share, assuming dilution, compared to $7.8 million, or $1.20 per common share, assuming dilution, for same period in 2012, an increase of $655 thousand, or 8.44%. The weighted average numbers of common shares, assuming dilution, were 7,301,861 and 5,912,051 for the years ended December 31, 2013 and 2012, respectively. Common shares outstanding were 8,216,747 and 7,055,946 at December 31, 2013 and 2012, respectively. For the quarter ended December 31, 2013, the Company reported consolidated net income of $2.0 million, or $0.24 per common share, assuming dilution, compared to $1.6 million, or $0.26 per common share, assuming dilution, for the quarter ended December 31, 2012, an increase of $360 thousand, or 22.02%. The weighted average numbers of common shares, assuming dilution, were 7,943,221 and 6,027,787 for the quarters ended December 31, 2013 and 2012, respectively.

"The operational results for the year ending December 31, 2013, reflect the integration of three transformative transactions for our Company," President and Chief Executive Officer, Steve Theroux, stated. "We are particularly pleased by our continued organic growth, and we are excited to focus our resources to maximize our franchise value. We are in a strong position to leverage our product platforms across companies and grow through our full array of financial products and services to benefit customers at any stage of their financial lives."

2013 Financial Highlights

• Total assets increased $151.7 million, or 11.94%, to $1.4 billion at December 31, 2013, from $1.3 billion at December 31, 2012.
• Net loans increased $231.9 million, or 25.70%, to $1.1 billion at December 31, 2013, from $902.2 million at December 31, 2012.
• In 2013, the Company originated $414.0 million in loans, compared to $426.8 million in 2012.
• The Company's loan servicing portfolio was $417.3 million at December 31, 2013, compared to $385.4 million at December 31, 2012.
• Total deposits increased $138.8 million, or 14.62%, to $1.1 billion at December 31, 2013, from $949.3 million at December 31, 2012. 
• Net interest and dividend income for the year ended December 31, 2013, was $33.8 million compared to $29.0 million for the same period in 2012.
• Net income available to common stockholders was $8.1 million for the year ended December 31, 2013, compared to $7.1 million for the same period in 2012 
• As a percentage of total loans, non-performing loans decreased to 1.97% at December 31, 2013, from 2.22% at December 31, 2012.

Earnings Summary

Net income of $8.4 million for the twelve months ended December 31, 2013, includes an increase of $4.8 million, or 16.39%, in net interest and dividend income. The provision for loan losses decreased $1.7 million to $962 thousand for the twelve months ended December 31, 2013, compared to $2.7 million for the same period in 2012. Noninterest income increased $1.0 million, or 7.14%, to $15.7 million for the twelve months ended December 31, 2013, compared to $14.6 million for the same period in 2012. This increase includes the addition of $2.7 million from trust and investment services income earned by Charter Trust Company since the acquisition in September of 2013 and a mark-to-market adjustment of $1.4 million related to the same acquisition partially offset by decreases of $2.9 million in net gains on sales and calls of securities and $643 thousand on net gains on sales of loans. Noninterest expense increased $7.4 million, or 25.23%, to $37.0 million for the twelve months ended December 31, 2013, compared to $29.5 million for the same period in 2012. Within noninterest expense, salaries and employee benefits increased $4.2 million, or 27.94%, to $19.2 million for the twelve months ended December 31, 2013, compared to $15.0 million for the same period in 2012. This increase reflects the expenses related to additional staff and operations for The Nashua Bank division acquired in December 2012, four months of expenses related to additional staff and operations for Charter Trust Company, and two months of expenses related to staff and operations for The Randolph National Bank and its eight branches, which the Company acquired in October 2013. Merger-related expenses increased $453 thousand, or 38.82%, to $1.6 million for the year ended December 31, 2013, compared to the same period in 2012 representing the costs of acquiring, converting and integrating The Randolph National Bank and Charter Holding Corp. in 2013 and The Nashua Bank in 2012.

Net income of $2.0 million for the quarter ended December 31, 2013, includes an increase of $2.4 million, or 33.06%, in net interest and dividend income compared to the same period in 2012. The provision for loan losses decreased $176 thousand to $268 thousand for the quarter ended December 31, 2013, compared to $444 thousand for the same period in 2012. Noninterest income increased $811 thousand, or 21.55%, to $4.6 million for the quarter ended December 31, 2013, compared to $3.8 million for the same period in 2012. This increase includes increases of $173 thousand in customer service fees, $13 thousand in rental income, the addition of $2.1 million in trust and investment services income, $30 thousand in insurance commission income, and $72 thousand in bank-owned life insurance income offset by decreases of $222 thousand in net gains on sales and calls of securities, $1.2 million in net gain on sales of loans, and $146 thousand in realized gains in Charter Holding Corp. Noninterest expense increased $3.2 million, or 40.51%, to $11.2 million for the quarter ended December 31, 2013, compared to $7.9 million for the same period in 2012, including an increase of $2.4 million of salaries and benefits expenses related to staffing additional locations as a result of the Company's recent acquisitions and the opening of a new branch in the Nashua market during the fourth quarter of 2013. Related to additional locations was an increase in occupancy and equipment expenses of $334 thousand, or 35.65%, for the quarter ended December 31, 2013, compared to the same period in 2012.

Balance Sheet Summary

Total assets were $1.4 billion at December 31, 2013, compared to $1.3 billion at December 31, 2012, an increase of 11.94%. Securities available-for-sale decreased $87.1 million to $125.2 million at December 31, 2013, from $212.4 million at December 31, 2012. Net loans held in portfolio increased $231.9 million, or 25.70%, to $1.1 billion million at December 31, 2013, from $902.2 million at December 31, 2012. This increase in loans includes approximately $131.2 million of loans from the acquisition of The Randolph National Bank. The allowance for loan losses was $9.8 million at December 31, 2013, compared to $9.9 million at December 31, 2012. The change in the allowance for loan losses is the net effect of provisions of $888 thousand, charge-offs of $1.8 million, and recoveries of $712 thousand in addition to a net increase of $10 thousand to the reserve for the overdraft protection program. Additionally, the Bank had a credit mark of $6.8 million at December 31, 2013 related to acquired loan balances of $191.4 million. Total loan production for the twelve months ended December 31, 2013 was $414.0 million compared to $426.8 million for the twelve months ended December 31, 2012. Loan production during the fourth quarter of 2013 was $119.3 million compared to $103.5 million for the same period in 2012.

Goodwill increased $7.9 million, or 22.47%, to $43.3 million at December 31, 2013, from $35.4 million at December 31, 2012. This increase reflects $3.2 million of goodwill related to the acquisition of Charter Holding Corp. and $4.7 million related to the acquisition of Central Financial Corp., holding company of The Randolph National Bank. Intangible assets increased $7.6 million, or 222.60%, to $11.0 million at December 31, 2013, compared to $3.4 million at December 31, 2012. This reflects a customer list intangible of $4.0 million related to Charter Holding Corp. and a core deposit intangible of $4.6 million related to The Randolph National Bank, net of intangible amortizations of $1.0 million for the year ended December 31, 2013.

Total deposits increased $138.8 million, or 14.62%, to $1.1 billion at December 31, 2013, from $949.3 million at December 31, 2012. This increase in deposits reflects the addition of approximately $148.7 million of deposits from the acquisition of The Randolph National Bank. Advances from the Federal Home Loan Bank decreased $21.0 million, or 14.71%, to $121.7 million at December 31, 2013, from $142.7 million at December 31, 2012.

Stockholders' equity of $149.3 million resulted in a book value of $15.37 per common share at December 31, 2013, based on 8,216,747 shares of common stock outstanding. The Bank remains well-capitalized with a Leverage (Tier I) Capital ratio of 8.39% at December 31, 2013.

Quarterly Dividend

On January 9, 2014, the Company declared a regular quarterly cash dividend of $0.13 per share payable January 31, 2014 to stockholders of record as of January 24, 2014. 

Annual Meeting

The 2014 Annual Meeting of Stockholders will be held on May 8, 2014 at the Lake Sunapee Bank Building, 1868 Room, 9 Main Street, Newport, New Hampshire at 10:00 a.m.

About New Hampshire Thrift Bancshares, Inc. New Hampshire Thrift Bancshares, Inc. is the holding company of Lake Sunapee Bank, fsb, a federally chartered savings bank that provides a wide range of life-cycle banking and financial services. Lake Sunapee Bank has four wholly owned subsidiaries: Lake Sunapee Financial Services Corp., Lake Sunapee Group, Inc., which owns and maintains all buildings and investment properties, McCrillis & Eldredge Insurance, Inc., a full-line independent insurance agency, and Charter Holding Corp., which wholly owns Charter Trust Company, a trust services and wealth management company. New Hampshire Thrift Bancshares, Inc., through its direct and indirect subsidiaries, operates 29 offices in New Hampshire in Grafton, Hillsborough, Merrimack and Sullivan counties and 18 offices in Vermont in Orange, Rutland and Windsor counties.

Forward-Looking Statements

The Company wishes to caution readers not to place undue reliance on any such forward-looking statements contained in this press release, which speak only as of the date made. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors discussed under the caption "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012, and in subsequent filings with the Securities and Exchange Commission. In addition, the forward-looking statements included in this press release represent our views as of the date of this release. The Company and Lake Sunapee Bank do not undertake and specifically decline any obligation to publicly release the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

New Hampshire Thrift Bancshares, Inc.
Selected Financial Highlights
For the Years Ended December 31,			2013				2012
(Dollars in thousands except for per share data)
Net Income			$	8,414$			7,759
Per Share Data:
	Basic Earnings			1.11			1.20
	Diluted Earnings (1)			1.11			1.20
	Dividends Paid			0.52			0.52
	Dividend Payout Ratio			46.85	%		43.33	%

As of December 31,				2013				2012
(Dollars in thousands except for per share data)
Total Assets				$	1,422,207			$	1,270,477
Total Securities (2)					134,998				221,875
Loans, Net					1,134,110				902,236
Total Deposits					1,088,092				949,341
Federal Home Loan Bank Advances					121,734				142,730
Stockholders' Equity					149,257				129,494
Book Value per Common Share				$	15.37			$	15.09
Common Shares Outstanding					8,216,747				7,055,946
Leverage (Tier I) Capital					8.39	%			8.87	%
Number of Offices:
		Banking Offices			38				29
		Insurance Offices			3				2
		Trust Offices			6				-

(1)	Diluted earnings per share are calculated using the weighted-average number of shares outstanding for the period, including common stock equivalents, as appropriate.
(2)	Includes available-for-sale securities shown at fair value and Federal Home Loan Bank stock at cost.

New Hampshire Thrift Bancshares, Inc.
Consolidated Balance Sheets
As of December 31,
(Dollars in thousands)					2013				2012
ASSETS					(unaudited)
	Cash and due from banks				$	13,748			$	26,147
	Overnight deposits					21,573				13,265
			Total cash and cash equivalents			35,321				39,412
	Securities available-for-sale					125,238				212,369
	Federal Home Loan Bank stock					9,760				9,506
	Loans held-for-sale					680				11,983
	Loans receivable, net of the allowance for loan losses of $9.8 million as of December 31, 2013, and $9.9 million as of December 31, 2012					1,134,110				902,236
	Accrued interest receivable					2,628				2,845
	Bank premises and equipment, net					23,842				17,261
	Investments in real estate					3,681				4,074
	Other real estate owned					1,343				102
	Goodwill					43,348				35,395
	Intangible assets					11,020				3,416
	Investment in partially owned Charter Holding Corp., at equity					-				4,909
	Bank-owned life insurance					19,544				18,905
	Other assets					11,692				8,064
		Total assets			$	1,422,207			$	1,270,477
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
	Deposits:
			Noninterest-bearing		$	101,446			$	74,133
			Interest-bearing			986,646				875,208
			Total deposits			1,088,092				949,341
	Federal Home Loan Bank advances					121,734				142,730
	Securities sold under agreements to repurchase					27,885				14,619
	Subordinated debentures					20,620				20,620
	Accrued expenses and other liabilities					14,619				13,673
		Total liabilities				1,272,950				1,140,983
STOCKHOLDERS' EQUITY
	Preferred stock, $.01 par value per share: 2,500,000 shares authorized:
		Series B, fixed rate noncumulative perpetual, fixed rate cumulative perpetual, 23,000 shares issued and outstanding at December 31, 2013, and 23,000 shares issued and outstanding at December 31, 2012				-				-
	Common stock, $.01 par value, per share: 10,000,000 shares authorized, 8,651,076 shares issued and 8,216,747 shares outstanding as of December 31, 2013, and 7,486,225 shares issued and 7,055,946 shares outstanding as of December 31, 2012					87				75
	Paid-in capital					100,961				83,977
	Retained earnings					58,347				53,933
	Accumulated other comprehensive loss					(2,897	)			(1,444	)
	Unearned stock awards					(490	)			(377	)
	Treasury stock, at cost, 434,329 shares as of December 31, 2013, and 430,279 shares as of December 31, 2012					(6,751	)			(6,670	)
		Total stockholders' equity				149,257				129,494
		Total liabilities and stockholders' equity			$	1,422,207			$	1,270,477

New Hampshire Thrift Bancshares, Inc.
Consolidated Statements of Income
(Dollars in thousands except for per share			For the Twelve Months Ended December 31,							Three Months Ended December 31,
data)			2013			2012				2013				2012
INTEREST AND DIVIDEND INCOME			(unaudited)							(unaudited)				(unaudited)
	Interest and fees on loans		$	38,034		$	32,542			$	10,758			$	8,489
	Interest and dividends on debt investments
	Taxable			1,333			3,223				292				466
	Dividends			52			62				13				15
	Other			857			594				251				135
	Total interest and dividend income			40,276			36,421				11,314				9,105
INTEREST EXPENSE
	Interest on deposits			4,055			4,381				993				1,026
	Interest on advances and other borrowed money			1,585			1,944				409				495
	Interest expense on debentures			806			1,027				159				252
	Interest on securities sold under agreements to repurchase			51			47				13				12
	Total interest expense			6,497			7,399				1,574				1,785
	Net interest and dividend income			33,779			29,022				9,740				7,320
PROVISION FOR LOAN LOSSES				962			2,705				268				444
	Net interest and dividend income after provision for loan losses			32,817			26,317				9,472				6,876
NONINTEREST INCOME
	Customer service fees			5,239			5,067				1,473				1,300
	Net gain on sales and calls of securities			964			3,819				182				404
	Net gain on sales of loans			2,224			2,867				166				1,333
	Net gain (loss) on sales of other real estate owned and fixed assets			5			(150	)			(5	)			-
	Mark-to-market adjustment on Charter Holding Corp.			1,369			-				-				-
	Rental income			746			736				189				176
	Realized gain in Charter Holding Corp.			294			444				-				146
	Trust and investment services income			2,741			-				2,063				-
	Insurance commission income			1,467			1,315				297				267
	Bank owned life insurance income			639			545				209				137
	Total noninterest income			15,688			14,643				4,574				3,763

(Dollars in thousands except for per share		For the Twelve Months Ended December 31,							Three Months Ended December 31,
data)		2013				2012			2013				2012
NONINTEREST EXPENSES		(unaudited)							(unaudited)				(unaudited)
Salaries and employee benefits			19,219				15,022			6,240				3,836
Occupancy and equipment expenses			4,500				3,648			1,271				937
Advertising and promotion			662				481			192				131
Depositors' insurance			776				802			202				198
Professional services			1,265				1,208			270				289
Data processing and outside services			1,393				1,117			389				268
Telephone			706				664			212				153
ATM processing fees			630				498			164				130
Net (benefit) amortization of mortgage servicing rights and mortgage servicing rights			(40	)			92			(17	)			(4	)
Supplies			454				373			104				94
Merger related expenses			1,620				1,167			147
Other expenses			5,779				4,445			1,977				1,904
Total noninterest expenses			36,964				29,517			11,151				7,936
INCOME BEFORE PROVISION FOR INCOME TAXES			11,541				11,443			2,895				2,703
PROVISION FOR INCOME TAXES			3,127				3,684			900				1,068
NET INCOME		$	8,414			$	7,759		$	1,995			$	1,635
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS		$	8,098			$	7,093		$	1,937			$	1,584
Earnings Per Common Share, basic		$	1.11			$	1.20		$	0.24			$	0.26
Earnings Per Common Share, assuming dilution (1)		$	1.11			$	1.20		$	0.24			$	0.26
Dividends Declared per common share		$	0.52			$	0.52		$	0.13			$	0.13

(1)	Diluted earnings per share are calculated using the weighted-average number of shares outstanding for the period, including common stock equivalents, as appropriate.

For additional information contact: Laura Jacobi First Senior Vice President Chief Financial Officer 603-863-0886