10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2014

Commission file number 0-23695

Brookline Bancorp, Inc.

(Exact name of registrant as specified in its charter)

Delaware	04-3402944
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
131 Clarendon Street, Boston, MA	02117-9179
(Address of principal executive offices)	(Zip Code)

(617) 425-4600

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.  YES  x  NO  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  YES  x  NO  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer xAccelerated filer oNon-accelerated filer o Smaller Reporting Company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  YES  o  NO  x

At August 8, 2014, the number of shares of common stock, par value $0.01 per share, outstanding was 70,015,431.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

FORM 10-Q

Index

		Page
Part I	Financial Information
Item 1.	Unaudited Consolidated Financial Statements
	Unaudited Consolidated Balance Sheets at June 30, 2014 and December 31, 2013	1
	Unaudited Consolidated Statements of Income for the Three Months and Six Months Ended June 30, 2014 and 2013	2
	Unaudited Consolidated Statements of Comprehensive Income for the Three Months and Six Months Ended June 30, 2014 and 2013	3
	Unaudited Consolidated Statements of Changes in Equity for the Six Months Ended June 30, 2014 and 2013	4
	Unaudited Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2014 and 2013	6
	Notes to Unaudited Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	50
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	85
Item 4.	Controls and Procedures	87
Part II	Other Information
Item 1.	Legal Proceedings	88
Item 1A.	Risk Factors	88
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	88
Item 3.	Defaults Upon Senior Securities	88
Item 4.	Mine Safety Disclosures	88
Item 5.	Other Information	88
Item 6.	Exhibits	89
	Signatures	90

PART I — FINANCIAL INFORMATION

Item 1. Unaudited Consolidated Financial Statements

BROOKLINE BANCORP, INC. AND SUBSIDIARIES Unaudited Consolidated Balance Sheets
	At June 30, 2014			At December 31, 2013
ASSETS	(In Thousands Except Share Data)
Cash and due from banks	$	58,962		$	37,148
Short-term investments	20,771			55,357
Total cash and cash equivalents	79,733			92,505
Investment securities available-for-sale	528,586			492,428
Investment securities held-to-maturity (fair value of $500)	500			500
Total investment securities	529,086			492,928
Loans and leases held-for-sale	13,890			13,372
Loans and leases:
Commercial real estate loans	2,314,585			2,203,623
Commercial loans and leases	1,076,953			965,610
Indirect automobile loans	376,314			400,531
Consumer loans	836,061			792,701
Total loans and leases	4,603,913			4,362,465
Allowance for loan and lease losses	(51,686		)	(48,473		)
Net loans and leases	4,552,227			4,313,992
Restricted equity securities	71,446			66,559
Premises and equipment, net of accumulated depreciation of $41,067 and $44,420, respectively	82,166			80,505
Deferred tax asset	27,799			31,710
Goodwill	137,890			137,890
Identified intangible assets, net of accumulated amortization of $24,583 and $22,895, respectively	15,199			16,887
Other real estate owned and repossessed assets	1,246			1,578
Other assets	76,804			77,180
Total assets	$	5,587,486		$	5,325,106
LIABILITIES AND EQUITY
Deposits:
Non-interest-bearing deposits:
Demand checking accounts	$	716,883		$	707,023
Interest-bearing deposits:
NOW accounts	209,682			210,602
Savings accounts	518,343			494,734
Money market accounts	1,516,023			1,487,979
Certificate of deposit accounts	900,216			934,668
Total interest-bearing deposits	3,144,264			3,127,983
Total deposits	3,861,147			3,835,006
Borrowed funds:
Advances from the FHLBB	1,005,644			768,773
Other borrowed funds	35,360			43,782
Total borrowed funds	1,041,004			812,555
Mortgagors’ escrow accounts	8,359			7,889
Accrued expenses and other liabilities	45,411			51,485
Total liabilities	4,955,921			4,706,935
Commitments and contingencies (Note 13)
Stockholders' Equity:
Brookline Bancorp, Inc. stockholders’ equity:
Common stock, $0.01 par value; 200,000,000 shares authorized; 75,744,445 shares issued	757			757
Additional paid-in capital	617,709			617,538
Retained earnings, partially restricted	73,373			64,903
Accumulated other comprehensive loss	(3,209		)	(7,915		)
Treasury stock, at cost; 5,144,807 shares and 5,171,985 shares, respectively	(59,487		)	(59,826		)
Unallocated common stock held by ESOP; 271,524 shares and 291,666 shares, respectively	(1,480		)	(1,590		)
Total Brookline Bancorp, Inc. stockholders’ equity	627,663			613,867
Noncontrolling interest in subsidiary	3,902			4,304
Total stockholders' equity	631,565			618,171
Total liabilities and stockholders' equity	$	5,587,486		$	5,325,106

See accompanying notes to the unaudited consolidated financial statements.

1

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Unaudited Consolidated Statements of Income

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands Except Share Data)						(In Thousands Except Share Data)
Interest and dividend income:
Loans and leases	$	50,433		$	50,644		$	102,375		$	100,063
Debt securities	2,360			1,934			4,619			3,786
Marketable and restricted equity securities	539			303			988			612
Short-term investments	14			19			58			50
Total interest and dividend income	53,346			52,900			108,040			104,511
Interest expense:
Deposits	4,201			4,743			8,492			9,578
Borrowed funds	2,711			2,794			5,380			5,903
Total interest expense	6,912			7,537			13,872			15,481
Net interest income	46,434			45,363			94,168			89,030
Provision for credit losses	2,276			2,439			4,719			4,294
Net interest income after provision for credit losses	44,158			42,924			89,449			84,736
Non-interest income:
Deposit fees	2,204			1,929			4,163			3,995
Loan fees	124			386			560			807
Loss from investments in affordable housing projects	(539		)	(624		)	(1,043		)	(936		)
Loss on sales of securities, net	(13		)	—			(13		)	—
Gain on sales of loans and leases held-for-sale	54			183			656			481
(Loss)/Gain on sale/disposals of premises and equipment, net	(6		)	(21		)	1,504			(21		)
Other	1,466			1,286			2,587			2,140
Total non-interest income	3,290			3,139			8,414			6,466
Non-interest expense:
Compensation and employee benefits	17,295			16,697			35,327			32,994
Occupancy	3,154			2,865			7,559			5,948
Equipment and data processing	4,348			4,262			8,725			8,362
Professional services	1,487			1,513			3,214			3,014
FDIC insurance	847			936			1,707			1,870
Advertising and marketing	776			768			1,441			1,438
Amortization of identified intangible assets	827			1,177			1,688			2,342
Other	2,488			2,598			5,137			5,617
Total non-interest expense	31,222			30,816			64,798			61,585
Income before provision for income taxes	16,226			15,247			33,065			29,617
Provision for income taxes	5,774			5,382			11,769			10,511
Net income before noncontrolling interest in subsidiary	10,452			9,865			21,296			19,106
Less net income attributable to noncontrolling interest in subsidiary	476			375			898			802
Net income attributable to Brookline Bancorp, Inc.	$	9,976		$	9,490		$	20,398		$	18,304
Earnings per common share:
Basic	$	0.14		$	0.14		$	0.29		$	0.26
Diluted	0.14			0.14			0.29			0.26
Weighted average common shares outstanding during the period:
Basic	69,886,576			69,774,703			69,881,055			69,768,777
Diluted	70,012,377			69,833,541			69,998,219			69,823,615
Dividends declared per common share	$	0.085		$	0.085		$	0.170		$	0.170

 See accompanying notes to the unaudited consolidated financial statements.

2

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Unaudited Consolidated Statements of Comprehensive Income

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands)
Net income before noncontrolling interest in subsidiary	$	10,452		$	9,865		$	21,296		$	19,106
Other comprehensive income (loss), net of taxes:
Investment securities available-for-sale:
Unrealized securities holding gains (losses)	4,350			(10,773		)	7,643			(12,791		)
Income tax (expense) benefit	(1,631		)	4,093			(2,893		)	4,861
Net unrealized securities holding gains (losses) before reclassification adjustments	2,719			(6,680		)	4,750			(7,930		)
Less reclassification adjustments for securities losses included in net income:
Loss on sales of securities, net	(13		)	—			(13		)	—
Income tax benefit	5			—			5			—
Net reclassification adjustments for securities losses included in net income	(8		)	—			(8		)	—
Net securities holding gains (losses)	2,727			(6,680		)	4,758			(7,930		)
Postretirement benefits:
Adjustment of accumulated obligation for postretirement benefits	—			8			(85		)	8
Income tax (expense) benefit	—			(2		)	33			(2		)
Net adjustment of accumulated obligation for postretirement benefits	—			6			(52		)	6
Other comprehensive income (loss), net of taxes	2,727			(6,674		)	4,706			(7,924		)
Comprehensive income	13,179			3,191			26,002			11,182
Net income attributable to noncontrolling interest in subsidiary	476			375			898			802
Comprehensive income attributable to Brookline Bancorp, Inc.	$	12,703		$	2,816		$	25,104		$	10,380

See accompanying notes to the unaudited consolidated financial statements.

3

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Unaudited Consolidated Statements of Changes in Equity

Six Months Ended June 30, 2014 and 2013

	Common Stock		Additional Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive (Loss) Income			Treasury Stock			Unallocated Common Stock Held by ESOP			Total Brookline Bancorp, Inc. Stockholders’ Equity			Noncontrolling Interest in Subsidiary			Total Equity
	(In Thousands Except Share Data)
Balance at December 31, 2013	$	757	$	617,538	$	64,903		$	(7,915	)	$	(59,826	)	$	(1,590	)	$	613,867		$	4,304		$	618,171
Net income attributable to Brookline Bancorp, Inc.	—		—		20,398			—			—			—			20,398			—			20,398
Net income attributable to noncontrolling interest in subsidiary	—		—		—			—			—			—			—			898			898
Issuance of noncontrolling units	—		—		—			—			—			—			—			60			60
Other comprehensive income	—		—		—			4,706			—			—			4,706			—			4,706
Common stock dividends of $0.17 per share	—		—		(11,928		)	—			—			—			(11,928		)	—			(11,928		)
Dividend to owners of noncontrolling interest in subsidiary	—		—		—			—			—			—			—			(1,360		)	(1,360		)
Compensation under recognition and retention plan	—		96		—			—			339			—			435			—			435
Common stock held by ESOP committed to be released (20,142 shares)	—		75		—			—			—			110			185			—			185
Balance at June 30, 2014	$	757	$	617,709	$	73,373		$	(3,209	)	$	(59,487	)	$	(1,480	)	$	627,663		$	3,902		$	631,565

4

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Unaudited Consolidated Statements of Changes in Equity (Continued)

Six Months Ended June 30, 2014 and 2013

	Common Stock		Additional Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Unallocated Common Stock Held by ESOP			Total Brookline Bancorp, Inc. Stockholders’ Equity			Noncontrolling Interest in Subsidiary			Total Equity
	(In Thousands Except Share Data)
Balance at December 31, 2012	$	757	$	618,426	$	53,358		$	3,483		$	(62,107	)	$	(1,820	)	$	612,097		$	3,712		$	615,809
Net income attributable to Brookline Bancorp, Inc.	—		—		18,304			—			—			—			18,304			—			18,304
Net income attributable to noncontrolling interest in subsidiary	—		—		—			—			—			—			—			802			802
Other comprehensive loss	—		—		—			(7,924		)	—			—			(7,924		)	—			(7,924		)
Common stock dividends of $0.17 per share	—		—		(11,915		)	—			—			—			(11,915		)	—			(11,915		)
Dividend to owners of noncontrolling interest in subsidiary	—		—		—			—			—			—			—			(927		)	(927		)
Compensation under recognition and retention plan	—		536		—			—			—			—			536			—			536
Common stock held by ESOP committed to be released (21,126 shares)	—		71		—			—			—			115			186			—			186
Balance at June 30, 2013	$	757	$	619,033	$	59,747		$	(4,441	)	$	(62,107	)	$	(1,705	)	$	611,284		$	3,587		$	614,871

See accompanying notes to the unaudited consolidated financial statements.

5

BROOKLINE BANCORP, INC. AND SUBSIDIARIES Unaudited Consolidated Statements of Cash Flows
	Six Months Ended June 30,
	2014			2013
	(In Thousands)
Cash flows from operating activities:
Net income attributable to Brookline Bancorp, Inc.	$	20,398		$	18,304
Adjustments to reconcile net income to net cash provided from operating activities:
Net income attributable to noncontrolling interest in subsidiary	898			802
Provision for credit losses	4,719			4,294
Origination of loans and leases to be sold	(15,784		)	(23,378		)
Proceeds from loans and leases sold	15,922			22,871
Proceeds from sales of other real estate owned and repossessed assets	6,795			5,495
Deferred income tax expense	1,046			(676		)
Depreciation of premises and equipment	3,416			2,822
Amortization of investment securities premiums and discounts, net	1,448			1,809
Amortization of deferred loan and lease origination costs, net	4,991			5,160
Amortization of identified intangible assets	1,688			2,342
Accretion of acquisition fair value adjustments, net	(6,884		)	(4,008		)
Gain on sales of loans and leases held-for-sale	(656		)	(481		)
Loss on sales of investment securities, net	13			—
Gain on sales of other real estate owned and repossessed assets	(27		)	(24		)
Write-down of other real estate owned and repossessed assets	189			178
(Gain)/loss on sale/disposals of premises and equipment, net	(1,504		)	21
Compensation under recognition and retention plans	435			536
Loss from investments in affordable housing projects	1,043			936
ESOP shares committed to be released	185			186
Net change in:
Cash surrender value of bank-owned life insurance	(519		)	(551		)
Other assets	(148		)	11,627
Accrued expenses and other liabilities	(6,279		)	(13,559		)
Net cash provided from operating activities	31,385			34,706
Cash flows from investing activities:
Proceeds from sales of investment securities available-for-sale	5,083			—
Proceeds from maturities, calls and principal repayments of investment securities available-for-sale	34,062			69,826
Purchases of investment securities available-for-sale	(69,108		)	(82,283		)
Proceeds from maturities, calls, and principal repayments of investment securities held-to-maturity	500			—
Purchases of investment securities held-to-maturity	(500		)	—
Proceeds from redemption of restricted equity securities	—			2,108
Purchases of restricted equity securities	(4,887		)	(74		)
Net increase in loans and leases	(248,738		)	(38,673		)
Proceeds from sales of premises and equipment	1,972			81
Purchase of premises and equipment, net	(5,635		)	(9,072		)
Net cash used for investing activities	(287,251		)	(58,087		)
				(Continued)

6

BROOKLINE BANCORP, INC. AND SUBSIDIARIES Unaudited Consolidated Statements of Cash Flows (Continued)
	Six Months Ended June 30,
	2014			2013
	(In Thousands)
Cash flows from financing activities:
Increase in demand checking, NOW, savings and money market accounts	60,593			79,161
Decrease in certificates of deposit	(34,584		)	(38,717		)
Proceeds from FHLBB advances	1,606,764			1,767,800
Repayment of FHLBB advances	(1,368,461		)	(1,771,275		)
Repayment of subordinated debt	—			(18,567		)
Decrease in other borrowed funds, net	(8,460		)	—
Increase in mortgagors’ escrow accounts	470			519
Payment of dividends on common stock	(11,928		)	(11,915		)
Proceeds from issuance of noncontrolling units	60			—
Payment of dividends to owners of noncontrolling interest in subsidiary	(1,360		)	(927		)
Net cash provided from financing activities	243,094			6,079
Net decrease in cash and cash equivalents	(12,772		)	(17,302		)
Cash and cash equivalents at beginning of period	92,505			117,097
Cash and cash equivalents at end of period	$	79,733		$	99,795
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest on deposits, borrowed funds and subordinated debt	$	15,438		$	17,884
Income taxes	8,490			11,301
Non-cash investing activities:
Transfer from loans to other real estate owned	$	6,625		$	5,650

See accompanying notes to the unaudited consolidated financial statements.

7

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

(1)     Basis of Presentation

Overview

Brookline Bancorp, Inc. (the “Company”) is a bank holding company (within the meaning of the Bank Holding Company Act of 1956, as amended) and the parent of Brookline Bank, a Massachusetts-chartered savings bank; Bank Rhode Island (“BankRI”), a Rhode Island-chartered bank; and First Ipswich Bank (“First Ipswich” and formerly known as the First National Bank of Ipswich), a Massachusetts-chartered trust company (collectively referred to as the “Banks”). The Banks are all members of the Federal Reserve System. The Company is also the parent of Brookline Securities Corp. (“BSC”). The Company’s primary business is to provide commercial, business and retail banking services to its corporate, municipal and individual customers through its banks and non-bank subsidiaries.

Brookline Bank, which includes its wholly-owned subsidiaries BBS Investment Corp. and Longwood Securities Corp., and its 84.7%-owned subsidiary, Eastern Funding LLC (“Eastern Funding”), operates 23 full-service banking offices in the greater Boston metropolitan area. BankRI, which includes its wholly-owned subsidiaries BRI Investment Corp., Macrolease Corporation (“Macrolease”), Acorn Insurance Agency and BRI Realty Corp., operates 19 full-service banking offices in the greater Providence area. First Ipswich, which includes its wholly-owned subsidiaries First Ipswich Securities II Corp. and First Ipswich Insurance Agency, operates 6 full-service banking offices on the north shore of eastern Massachusetts and in the Boston metropolitan area.

The Company’s activities include acceptance of commercial, municipal and retail deposits, origination of mortgage loans on commercial and residential real estate located principally in Massachusetts and Rhode Island, origination of commercial loans and leases to small- and mid-sized businesses, origination of indirect automobile loans, investment in debt and equity securities, and the offering of cash management and investment advisory services. The Company also provides specialty equipment financing through its subsidiaries Eastern Funding, which is based in New York City, and Macrolease, which is based in Plainview, New York.

The Company and the Banks are supervised, examined and regulated by the Board of Governors of the Federal Reserve System ("FRB"). As Massachusetts-chartered member banks, Brookline Bank and First Ipswich are also subject to regulation under the laws of the Commonwealth of Massachusetts and the jurisdiction of the Massachusetts Division of Banks. BankRI is subject to regulation under the laws of the State of Rhode Island and the jurisdiction of the Banking Division of the Rhode Island Department of Business Regulation.

The Federal Deposit Insurance Corporation (“FDIC”) offers insurance coverage on all deposits up to $250,000 per depositor at each of the three Banks. As FDIC-insured depository institutions, all three Banks are also secondarily subject to supervision, examination and regulation by the FDIC. Additionally, as a Massachusetts-chartered savings bank, Brookline Bank is also insured by the Depositors Insurance Fund (“DIF”), a private industry-sponsored insurance company. The DIF insures savings bank deposits in excess of the FDIC insurance limits. As such, Brookline Bank offers 100% insurance on all deposits as a result of a combination of insurance from the FDIC and the DIF. Brookline Bank is required to file reports with the DIF.

Basis of Financial Statement Presentation

The unaudited consolidated financial statements of the Company presented herein have been prepared pursuant to the rules of the Securities and Exchange Commission (“SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“GAAP”). In the opinion of management, all adjustments (consisting of normal recurring adjustments) and disclosures considered necessary for the fair presentation of the accompanying consolidated financial statements have been included. Interim results are not necessarily reflective of the results of the entire year. The accompanying unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2013. 

The unaudited consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances are eliminated in consolidation.

8

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

In preparing these consolidated financial statements, management is required to make significant estimates and assumptions that affect the reported amounts of assets, liabilities, income, expenses and disclosure of contingent assets and liabilities. Actual results could differ from those estimates based upon changing conditions, including economic conditions and future events. Material estimates that are particularly susceptible to significant change in the near-term include the determination of the allowance for loan and lease losses, the determination of fair market values of assets and liabilities, including acquired loans and leases, the review of goodwill and intangibles for impairment and the review of deferred tax assets for valuation allowances.

The judgments used by management in applying these critical accounting policies may be affected by a further and prolonged deterioration in the economic environment, which may result in changes to future financial results. For example, subsequent evaluations of the loan and lease portfolio, in light of the factors then prevailing, may result in significant changes in the allowance for loan and lease losses in future periods, and the inability to collect outstanding principal may result in increased loan and lease losses.

Reclassification

Certain previously reported amounts have been reclassified to conform to the current year’s presentation. These reclassifications did not change stockholders' equity and net income reported.

(2)         Recent Accounting Pronouncements

In June 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2014-11, Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures. This ASU eliminates sale accounting for repurchase-to-maturity transactions and supersedes the guidance under which a transfer of a financial asset and a contemporaneous repurchase financing could be accounted for on a combined basis as a forward agreement. In addition, the ASU requires a new disclosure for transactions economically similar to repurchase agreements in which the transferor retains substantially all of the exposure to the economic return on the transferred financial assets throughout the term of the transaction. The ASU is effective for annual periods beginning after December 15, 2014 and interim periods beginning after December 15, 2015; early application is not permitted. The Company is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2014.

In May 2014, the FASB issued ASU 2014-09, Revenue From Contracts with Customers. This ASU provides a single principles-based, five-step model to be applied to all contracts with customers. The ASU applies to all contracts with customers except those that are within the scope of other topics in the FASB Accounting Standards Codification. The ASU is effective for annual periods (including interim reporting periods within those periods) beginning after December 15, 2016; early application is not permitted. The Company is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2014.

In January 2014, the FASB issued ASU 2014-04, Receivables-Troubled Debt Restructurings by Creditors. This ASU provides clarification on when an in substance repossession or foreclosure occurs resulting in the creditor derecognizing the loan and recognizing the collateral. Currently, there is no definition of in substance repossession or foreclosure and physical possession in the accounting literature. This ASU is applied retrospectively or effective prospectively for all annual periods presented beginning after December 15, 2014; early adoption is permitted. The Company has not chosen to early adopt ASU 2014-04 and is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2014.

In January 2014, the FASB issued ASU 2014-01, Accounting for Investments in Qualified Affordable Housing Projects. This ASU provides guidance on accounting for investments by a reporting entity in flow-through limited liability entities. Currently, investments in qualified affordable housing projects are accounted for either by the effective yield, equity or cost method. This ASU allows for reporting entities to make a policy election on how to account for their investments. This ASU is applied retrospectively or effective prospectively for all annual periods presented beginning after December 15, 2014; early adoption is permitted. The Company has not chosen to early adopt ASU 2014-01 and is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2014.

9

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

(3)         Investment Securities

The following tables set forth investment securities available-for-sale and held-to-maturity at the dates indicated:

	At June 30, 2014
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(In Thousands)
Debt securities:
GSEs	$	15,968	$	21	$	11	$	15,978
GSE CMOs	254,863		146		7,462		247,547
GSE MBSs	220,848		2,559		1,560		221,847
SBA commercial loan asset-backed securities	227		—		1		226
Corporate debt obligations	39,759		582		11		40,330
Trust preferred securities	1,462		—		163		1,299
Total debt securities	533,127		3,308		9,208		527,227
Marketable equity securities	1,264		96		1		1,359
Total investment securities available-for-sale	$	534,391	$	3,404	$	9,209	$	528,586
Investment securities held-to-maturity	$	500	$	—	$	—	$	500

	At December 31, 2013
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(In Thousands)
Debt securities:
GSEs	$	12,138	$	42	$	—	$	12,180
GSE CMOs	254,331		86		10,773		243,644
GSE MBSs	202,478		1,852		4,929		199,401
Private-label CMOs	3,258		115		18		3,355
SBA commercial loan asset-backed securities	245		—		2		243
Auction-rate municipal obligations	1,900		—		125		1,775
Municipal obligations	1,068		18		—		1,086
Corporate debt obligations	27,751		506		33		28,224
Trust preferred securities	1,461		—		251		1,210
Total debt securities	504,630		2,619		16,131		491,118
Marketable equity securities	1,259		61		10		1,310
Total investment securities available-for-sale	$	505,889	$	2,680	$	16,141	$	492,428
Investment securities held-to-maturity	$	500	$	—	$	—	$	500

At June 30, 2014, the fair value of all securities available-for-sale was $528.6 million, with net unrealized losses of $5.8 million, compared to a fair value of $492.4 million and net unrealized losses of $13.5 million at December 31, 2013. At June 30, 2014, $344.5 million, or 65.2%, of the portfolio, had gross unrealized losses, compared to $383.3 million, or 77.8%, at December 31, 2013. The total gross unrealized loss at June 30, 2014 was $9.2 million, as compared to $16.1 million at December 31, 2013.

10

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Investment Securities as Collateral

At June 30, 2014 and December 31, 2013, respectively, $392.9 million and $402.5 million of investment securities available-for-sale were pledged as collateral for repurchase agreements; municipal deposits; treasury, tax and loan deposits; swap agreements; and Federal Home Loan Bank of Boston (“FHLBB”) borrowings.

Other-Than-Temporary Impairment (“OTTI”)

Investment securities at June 30, 2014 and December 31, 2013 that have been in a continuous unrealized loss position for less than twelve months or twelve months or longer are as follows:

	At June 30, 2014
	Less than Twelve Months				Twelve Months or Longer				Total
	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
	(In Thousands)
Debt securities:
GSEs	$	1,963	$	11	$	—	$	—	$	1,963	$	11
GSE CMOs	38,406		839		196,095		6,623		234,501		7,462
GSE MBSs	12,323		51		89,592		1,509		101,915		1,560
SBA commercial loan asset-backed securities	31		—		176		1		207		1
Corporate debt obligations	4,067		11		—		—		4,067		11
Trust preferred securities	—		—		1,299		163		1,299		163
Temporarily impaired debt securities	56,790		912		287,162		8,296		343,952		9,208
Marketable equity securities	511		1		—		—		511		1
Total temporarily impaired investment securities	$	57,301	$	913	$	287,162	$	8,296	$	344,463	$	9,209

	At December 31, 2013
	Less than Twelve Months				Twelve Months or Longer				Total
	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
	(In Thousands)
Debt securities:
GSE CMOs	$	221,317	$	9,861	$	16,257	$	912	$	237,574	$	10,773
GSE MBSs	121,836		3,746		13,516		1,183		135,352		4,929
Private-label CMOs	639		18		—		—		639		18
SBA commercial loan asset-backed securities	32		—		192		2		224		2
Auction-rate municipal obligations	—		—		1,775		125		1,775		125
Corporate debt obligations	5,988		33		—		—		5,988		33
Trust preferred securities	—		—		1,210		251		1,210		251
Temporarily impaired debt securities	349,812		13,658		32,950		2,473		382,762		16,131
Marketable equity securities	501		10		—		—		501		10
Total temporarily impaired investment securities	$	350,313	$	13,668	$	32,950	$	2,473	$	383,263	$	16,141

11

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

The Company performs regular analysis on the available-for-sale investment securities portfolio to determine whether a decline in fair value indicates that an investment is OTTI. In making these OTTI determinations, management considers, among other factors, the length of time and extent to which the fair value has been less than amortized cost; projected future cash flows; credit subordination and the creditworthiness, capital adequacy and near-term prospects of the issuers.

Management also considers the Company’s capital adequacy, interest-rate risk, liquidity and business plans in assessing whether it is more likely than not that the Company will sell or be required to sell the securities before recovery. If the Company determines that a decline in fair value is OTTI and that it is more likely than not that the Company will not sell or be required to sell the security before recovery of its amortized cost, the credit portion of the impairment loss is recognized in earnings and the noncredit portion is recognized in accumulated other comprehensive income. The credit portion of the OTTI impairment represents the difference between the amortized cost and the present value of the expected future cash flows of the security. If the Company determines that a decline in fair value is OTTI and it is more likely than not that it will sell or be required to sell the security before recovery of its amortized cost, the entire difference between the amortized cost and the fair value of the security will be recognized in earnings.

At June 30, 2014, it is more likely than not that the Company will not sell or be required to sell the securities before recovery of its amortized cost. The Company's ability and intent to hold these securities until recovery is supported by the Company's strong capital and liquidity positions as well as its historically low portfolio turnover. As such, management has determined that the securities are not OTTI at June 30, 2014. If market conditions for securities worsen or the creditworthiness of the underlying issuers deteriorates, it is possible that the Company may recognize additional OTTI in future periods.

Debt Securities

U.S. Government-Sponsored Enterprises

The Company invests in securities issued by U.S. Government-sponsored enterprises (“GSEs”), including GSE debt securities, mortgage-backed securities (“MBSs”), and collateralized mortgage obligations (“CMOs”). GSE securities include obligations issued by the Federal National Mortgage Association (“FNMA”), the Federal Home Loan Mortgage Corporation (“FHLMC"), the Government National Mortgage Association (“GNMA”), the Federal Home Loan Banks ("FHLB") and the Federal Farm Credit Bank. At June 30, 2014, only GNMA MBSs and CMOs, and Small Business Administration (“SBA”) commercial loan asset-backed securities with an estimated fair value of $25.4 million were backed explicitly by the full faith and credit of the U.S. Government, compared to $18.9 million at December 31, 2013.

At June 30, 2014, the Company held GSE debentures with a total fair value of $16.0 million and a net unrealized gain of $10.0 thousand. At December 31, 2013, the Company held GSE debentures with a total fair value of $12.2 million and a net unrealized gain of $42.0 thousand. At June 30, 2014, one of the six securities in this portfolio were in unrealized loss positions. At December 31, 2013, none of the five securities in this portfolio was in unrealized loss positions. All securities are performing and backed by the implicit (FHLB / FNMA / FHLMC) or explicit (GNMA / SBA) guarantee of the U.S. Government. During the six months endedJune 30, 2014, the Company purchased $2.0 million in GSE debentures. The Company did not purchase any GSE debentures in the same period in 2013.

At June 30, 2014, the Company held GSE mortgage-related securities with a total fair value of $469.4 million and a net unrealized loss of $6.3 million. This compares to a total fair value of $443.0 million and a net unrealized loss of $13.8 million at December 31, 2013. At June 30, 2014, 96 of the 241 securities in this portfolio were in unrealized loss positions, compared to 86 of the 232 securities at December 31, 2013. All securities are performing and backed by the implicit (FHLB / FNMA / FHLMC) or explicit (GNMA) guarantee of the U.S. Government. During the six months endedJune 30, 2014, the Company purchased $55.1 million in GSE CMOs and GSE MBSs to reinvest cash from matured securities. This compares to a total of $82.3 million during the same period in 2013.

SBA Commercial Loan Asset-Backed

At both June 30, 2014 and December 31, 2013, the Company held nine SBA securities with a total fair value of $0.2 million which approximated amortized cost. At both June 30, 2014 and December 31, 2013, seven of the nine securities in this portfolio were in unrealized loss positions. All securities are performing and backed by the explicit (SBA) guarantee of the U.S. Government.

12

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Private-Label CMOs

At June 30, 2014, the Company held no private-issuer CMO-related securities. All private-label CMOs were sold during the second quarter of 2014. At December 31, 2013, the Company held private-issuer CMO-related securities with a total fair value of $3.4 million and a net unrealized gain of $0.1 million. At December 31, 2013, two of the eleven securities in this portfolio were in unrealized loss positions.

Auction-Rate Municipal Obligations and Municipal Obligations

The auction-rate obligations owned by the Company were rated “AAA” at the time of acquisition due, in part, to the guarantee of third-party insurers who would have to pay the obligations if the issuers failed to pay the obligations when they become due. During the financial crisis, certain third-party insurers experienced financial difficulties and were not able to meet their contractual obligations. As a result, auctions failed to attract a sufficient number of investors and created a liquidity problem for those investors who were relying on the obligations to be redeemed at auction. Since then, there has not been an active market for auction-rate municipal obligations.

At June 30, 2014, the Company held no auction-rate municipal obligations. All auction-rate municipal obligations were sold during the second quarter of 2014. This compares to an estimated fair value of $1.8 million, with a corresponding net unrealized loss of $0.1 million at December 31, 2013. At December 31, 2013, all of the securities in this portfolio were in unrealized loss positions.

The Company owns no municipal obligations at June 30, 2014. All municipal obligations were sold during the second quarter of 2014. This compares to a total fair value of $1.1 million which also approximated amortized cost at December 31, 2013. At December 31, 2013, none of the securities in this portfolio was in unrealized loss position.

Corporate Obligations

From time to time, the Company will invest in high-quality corporate obligations to provide portfolio diversification and improve the overall yield on the portfolio. The Company owned thirteen corporate obligation securities with a total fair value of $40.3 million and total net unrealized gains of $0.6 million at June 30, 2014. This compares to eleven corporate obligation securities with a total fair value of $28.2 million and total net unrealized gains of $0.5 million at December 31, 2013. At June 30, 2014, one of the thirteen securities in this portfolio were in unrealized loss positions. At December 31, 2013, two of the eleven securities in this portfolio are in unrealized loss positions. Full collection of the obligations is expected because the financial condition of the issuers is sound, none of the issuers has defaulted on scheduled payments, the obligations are rated investment grade and the Company has the ability and intent to hold the obligations for a period of time to recover the amortized cost. During the six months endedJune 30, 2014, the Company purchased $12.0 million in corporate obligations. The Company did not purchase any corporate obligations in the same period in 2013.

Trust Preferred Securities

Trust preferred securities represent subordinated debt issued by financial institutions. At June 30, 2014, the Company owned two trust preferred securities with a total fair value of $1.3 million and total net unrealized loss of $0.2 million. This compares to two trust preferred securities with a total fair value of $1.2 million and a total net unrealized loss of $0.3 million at December 31, 2013. At June 30, 2014 and December 31, 2013, both of the securities in this portfolio were in unrealized loss positions. Full collection of the obligations is expected because the financial condition of the issuers is sound, none of the issuers has defaulted on scheduled payments, the obligations are rated investment grade and the Company has the ability and intent to hold the obligations for a period of time to recover the amortized cost.

Marketable Equity Securities

At June 30, 2014, the Company owned marketable equity securities with a fair value of $1.4 million, including net unrealized gains of $0.1 million. This compares to a fair value of $1.3 million and net unrealized gains of $0.1 million at December 31, 2013. At both June 30, 2014 and December 31, 2013, one out of the four securities in this portfolio was in an unrealized loss position.

13

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Investment Securities Held-to-Maturity

At June 30, 2014, the Company owned a held-to-maturity investment security with a carrying value of $0.5 million and a fair value of $0.5 million. This security matures in March 2016 and carries an interest rate payable of 1.3%.

Portfolio Maturities

The maturities of the investments in debt securities are as follows at the dates indicated:

	At June 30, 2014						At December 31, 2013
	Amortized Cost		Estimated Fair Value		Weighted Average Rate		Amortized Cost		Estimated Fair Value		Weighted Average Rate
	(Dollars in Thousands)
Investment securities available-for-sale:
Within 1 year	$	12,343	$	12,370	0.67	%	$	13,012	$	13,062	0.82	%
After 1 year through 5 years	52,908		54,177		2.64	%	40,204		41,187		2.90	%
After 5 years through 10 years	85,907		87,009		1.97	%	66,447		67,075		2.23	%
Over 10 years	381,969		373,671		1.91	%	384,967		369,794		1.90	%
	$	533,127	$	527,227	1.96	%	$	504,630	$	491,118	2.00	%
Investment securities held-to-maturity:
Within 1 year	$	—	$	—	—	%	$	500	$	500	1.99	%
After 1 year through 5 years	500		500		1.30	%	—		—		—	%
After 5 years through 10 years	—		—		—	%	—		—		—	%
Over 10 years	—		—		—	%	—		—		—	%
	$	500	$	500	1.30	%	$	500	$	500	1.99	%

Actual maturities of debt securities may differ from those presented above since certain obligations provide the issuer the right to call or prepay the obligation prior to scheduled maturity without penalty. At June 30, 2014, issuers of debt securities with an estimated fair value of $5.2 million had the right to call or prepay the obligations. Of the $5.2 million, $2.0 million matures in 1 - 5 years, $1.9 million matures in 6 - 10 years and $1.3 million matures after ten years. At December 31, 2013, issuers of debt securities with an estimated fair value of $3.7 million had the right to call or prepay the obligations. Of the $3.7 million$0.7 million matures in less than one year and $3.0 million matures after ten years. MBSs and CMOs are included above based on their contractual maturities; the remaining lives, however, are expected to be shorter due to anticipated prepayments.

Security Sales

When securities are sold, the adjusted cost of the specific security sold is used to compute the gain or loss on the sale. The following table shows the gross realized gains and losses on available for sale securities for the periods indicated:

	Three Months Ended June 30, 2014			Six Months Ended June 30, 2014
	(In Thousands)
Sales of debt securities	$	5,083		$	5,083
Gross gains from sales	302			302
Gross losses from sales	315			315
Loss on sales of securities, net	$	(13	)	$	(13	)

14

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

There were no security sales during the three and six-month periods ended June 30, 2013.

(4)        Loans and Leases

The following tables present loan and lease balances and weighted average coupon rates for the originated and acquired loan and lease portfolios at the dates indicated:

	At June 30, 2014
	Originated				Acquired				Total
	Balance		Weighted Average Coupon		Balance		Weighted Average Coupon		Balance		Weighted Average Coupon
	(Dollars in Thousands)
Commercial real estate loans:
Commercial real estate mortgage	$	1,229,783	4.29	%	$	315,700	4.38	%	$	1,545,483	4.31	%
Multi-family mortgage	562,072		4.12	%	69,299		4.54	%	631,371		4.17	%
Construction	125,940		3.87	%	11,791		4.43	%	137,731		3.92	%
Total commercial real estate loans	1,917,795		4.21	%	396,790		4.41	%	2,314,585		4.25	%
Commercial loans and leases:
Commercial	370,813		3.70	%	108,043		4.39	%	478,856		3.86	%
Equipment financing	534,261		6.97	%	18,228		6.35	%	552,489		6.95	%
Condominium association	45,608		4.68	%	—		—	%	45,608		4.68	%
Total commercial loans and leases	950,682		5.58	%	126,271		4.67	%	1,076,953		5.48	%
Indirect automobile loans	376,314		4.62	%	—		—	%	376,314		4.62	%
Consumer loans:
Residential mortgage	442,551		3.62	%	108,263		3.86	%	550,814		3.67	%
Home equity	155,122		3.39	%	115,081		3.86	%	270,203		3.59	%
Other consumer	14,343		4.51	%	701		14.87	%	15,044		5.00	%
Total consumer loans	612,016		3.58	%	224,045		3.90	%	836,061		3.67	%
Total loans and leases	$	3,856,807	4.49	%	$	747,106	4.29	%	$	4,603,913	4.45	%

15

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	At December 31, 2013
	Originated				Acquired				Total
	Balance		Weighted Average Coupon		Balance		Weighted Average Coupon		Balance		Weighted Average Coupon
	(Dollars in Thousands)
Commercial real estate loans:
Commercial real estate mortgage	$	1,111,750	4.34	%	$	350,235	4.42	%	$	1,461,985	4.36	%
Multi-family mortgage	554,555		4.19	%	73,378		4.63	%	627,933		4.24	%
Construction	102,927		3.81	%	10,778		4.37	%	113,705		3.87	%
Total commercial real estate loans	1,769,232		4.26	%	434,391		4.46	%	2,203,623		4.30	%
Commercial loans and leases:
Commercial	297,684		3.68	%	110,108		4.54	%	407,792		3.91	%
Equipment financing	485,330		7.14	%	27,694		6.60	%	513,024		7.11	%
Condominium association	44,794		4.74	%	—		—	%	44,794		4.74	%
Total commercial loans and leases	827,808		5.77	%	137,802		4.95	%	965,610		5.65	%
Indirect automobile loans	400,531		4.98	%	—		—	%	400,531		4.98	%
Consumer loans:
Residential mortgage	411,554		3.65	%	116,631		3.93	%	528,185		3.71	%
Home equity	132,396		3.39	%	125,065		3.88	%	257,461		3.63	%
Other consumer	5,532		5.98	%	1,523		14.89	%	7,055		7.90	%
Total consumer loans	549,482		3.61	%	243,219		3.98	%	792,701		3.72	%
Total loans and leases	$	3,547,053	4.59	%	$	815,412	4.38	%	$	4,362,465	4.55	%

The Company lends primarily in the eastern half of Massachusetts, southern New Hampshire and Rhode Island, with the exception of equipment financing, 36.9% of which is in the greater New York/New Jersey metropolitan area and 63.1% of which is in other areas in the United States of America.

Accretable Yield for the Acquired Loan Portfolio

The following table summarizes activity in the accretable yield for the acquired loan portfolio for the periods indicated:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands)
Balance at beginning of period	$	42,501		$	53,815		$	45,789		$	57,812
Reclassification from nonaccretable difference for loans with improved cash flows	214			3,180			1,654			5,376
Accretion	(4,537		)	(4,813		)	(9,265		)	(11,006		)
Balance at end of period	$	38,178		$	52,182		$	38,178		$	52,182

On a quarterly basis, subsequent to acquisition, management reforecasts the expected cash flows for acquired ASC 310-30 loans, taking into account prepayment speeds, probability of default and loss given defaults. Management compares cash flow projections per the reforecast to the original cash flow projections and determines whether any reduction in cash flow expectations are due to credit deterioration, or if the change in cash flow is related to noncredit events. This cash flow analysis is used to evaluate the need for a loan loss provision and/or prospective yield adjustments. During the six months endedJune 30, 2014 and 2013, accretable yield adjustments totaling $1.7 million and $5.4 million, respectively, were made for certain

16

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

loan pools. These prospective accretable yield adjustments, which are subject to continued re-assessment, will be recognized over the remaining lives of those pools.

The aggregate remaining nonaccretable difference (representing both principal and interest) applicable to acquired loans and leases totaled $4.6 million and $6.1 million at June 30, 2014 and December 31, 2013, respectively.

Related Party Loans

The Banks’ authority to extend credit to their respective directors and executive officers, as well as to entities controlled by such persons, is currently governed by the requirements of the Sarbanes-Oxley Act of 2002 and Regulation O of the FRB. Among other things, these provisions require that extensions of credit to insiders (1) be made on terms that are substantially the same as, and follow credit underwriting procedures that are not less stringent than, those prevailing for comparable transactions with unaffiliated persons and that do not involve more than the normal risk of repayment or present other unfavorable features; and (2) not exceed certain limitations on the amount of credit extended to such persons, individually and in the aggregate, which limits are based, in part, on the amount of the Banks’ capital. In addition, the extensions of credit to insiders must be approved by each Bank’s Board of Directors.

The following table summarizes the change in the total amounts of loans and advances, to directors, executive officers and their affiliates for the periods indicated. All loans were performing at June 30, 2014 and December 31, 2013.

	Six Months Ended June 30,
	2014			2013
	(In Thousands)
Balance at beginning of period	$	16,110		$	4,083
New loans granted during the period	1,740			100
Advances on lines of credit	1,451			91
Repayments	(522		)	(349		)
Loans no longer classified as related party loans	(978		)	545
Balance at end of period	$	17,801		$	4,470

Unfunded commitments on extensions of credit to insiders totaled $10.4 million and $11.7 million at June 30, 2014 and December 31, 2013, respectively.

Loans and Leases Pledged as Collateral

At June 30, 2014 and December 31, 2013, respectively, $1.5 billion and $1.2 billion of loans and leases were pledged as collateral for wholesale borrowing.

17

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

(5)    Allowance for Loan and Lease Losses

The following tables present the changes in the allowance for loan and lease losses and the recorded investment in loans and leases by portfolio segment for the periods indicated:

	Three Months Ended June 30, 2014
	Commercial Real Estate		Commercial			Indirect Automobile			Consumer			Unallocated			Total
	(In Thousands)
Balance at March 31, 2014	$	24,858	$	15,544		$	3,664		$	3,110		$	3,048		$	50,224
Charge-offs	—		(796		)	(228		)	(172		)	—			(1,196		)
Recoveries	—		218			173			85			—			476
Provision (credit) for loan and lease losses	1,857		900			77			(6		)	(646		)	2,182
Balance at June 30, 2014	$	26,715	$	15,866		$	3,686		$	3,017		$	2,402		$	51,686

	Three Months Ended June 30, 2013
	Commercial Real Estate			Commercial			Indirect Automobile			Consumer			Unallocated		Total
	(In Thousands)
Balance at March 31, 2013	$	20,588		$	11,652		$	5,000		$	2,596		$	2,696	$	42,532
Charge-offs	(81		)	(477		)	(318		)	(154		)	—		(1,030		)
Recoveries	—			182			149			60			—		391
Provision (credit) for loan and lease losses	1,512			434			(136		)	497			81		2,388
Balance at June 30, 2013	$	22,019		$	11,791		$	4,695		$	2,999		$	2,777	$	44,281

	Six Months Ended June 30, 2014
	Commercial Real Estate		Commercial			Indirect Automobile			Consumer			Unallocated			Total
	(In Thousands)
Balance at December 31, 2013	$	23,022	$	15,220		$	3,924		$	3,375		$	2,932		$	48,473
Charge-offs	—		(1,347		)	(517		)	(382		)	—			(2,246		)
Recoveries	—		469			277			114			—			860
Provision (credit) for loan and lease losses	3,693		1,524			2			(90		)	(530		)	4,599
Balance at June 30, 2014	$	26,715	$	15,866		$	3,686		$	3,017		$	2,402		$	51,686

	Six Months Ended June 30, 2013
	Commercial Real Estate			Commercial			Indirect Automobile			Consumer			Unallocated		Total
	(In Thousands)
Balance at December 31, 2012	$	20,018		$	10,655		$	5,304		$	2,545		$	2,630	$	41,152
Charge-offs	(81		)	(724		)	(680		)	(206		)	—		(1,691		)
Recoveries	4			264			279			86			—		633
Provision (credit) for loan and lease losses	2,078			1,596			(208		)	574			147		4,187
Balance at June 30, 2013	$	22,019		$	11,791		$	4,695		$	2,999		$	2,777	$	44,281

The liability for unfunded credit commitments, which is included in other liabilities, was $1.2 million, $1.0 million and $0.9 million at June 30, 2014, December 31, 2013 and June 30, 2013, respectively. During the six-month periods ended June 30, 2014 and 2013, the liability for unfunded credit commitments increased by $0.2 million and $0.2 million, respectively, to reflect changes in the estimate of loss exposure associated with credit commitments. No credit commitments were charged off against the liability account in the six-month periods ended June 30, 2014 and 2013.

18

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Provision for Credit Losses

The provisions for credit losses are set forth below for the periods indicated:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands)
Provision (credit) for loan and lease losses:
Commercial real estate	$	1,857		$	1,512		$	3,693		$	2,078
Commercial	900			434			1,524			1,596
Indirect automobile	77			(136		)	2			(208		)
Consumer	(6		)	497			(90		)	574
Unallocated	(646		)	81			(530		)	147
Total provision for loan and lease losses	2,182			2,388			4,599			4,187
Unfunded credit commitments	94			51			120			107
Total provision for credit losses	$	2,276		$	2,439		$	4,719		$	4,294

Procedure for Placing Loans and Leases on Nonaccrual

Accrual of interest on loans generally is discontinued when contractual payment of principal or interest becomes past due 90 days or, if in management’s judgment, reasonable doubt exists as to the full timely collection of interest. Exceptions may be made if the loan has matured and is in the process of renewal or is well-secured and in the process of collection. When a loan is placed on nonaccrual status, interest accruals cease and uncollected accrued interest is reversed and charged against current interest income. Interest payments on nonaccrual loans are applied to principal. Loans are returned to accrual status when principal and interest payments are current, full collectability of principal and interest is reasonably assured and a consistent record of at least six consecutive months of performance has been achieved.

Allowance for Loan and Lease Losses Methodology

Management has established a methodology to determine the adequacy of the allowance for loan and lease losses that assesses the risks and losses inherent in the loan and lease portfolio. For purposes of determining the allowance for loan and lease losses, the Company has segmented certain loans and leases in the portfolio by product type into the following pools: (1) commercial real estate loans, (2) commercial loans and leases, (3) indirect automobile loans and (4) consumer loans. Portfolio segments are further disaggregated into classes based on the associated risks within the segments. Commercial real estate loans are divided into three classes: commercial real estate mortgage loans, multi-family mortgage loans and construction loans. Commercial loans and leases are divided into three classes: commercial loans, equipment financing, and loans to condominium associations. The indirect automobile loan segment is not divided into classes. Consumer loans are divided into three classes: residential mortgage loans, home equity loans and other consumer loans. For each class of loan, management makes significant judgments in selecting the estimation method that fits the credit characteristics of its class and portfolio segment as set forth below.

General Allowance

The general allowance for loan and lease losses was $48.2 million at June 30, 2014, compared to $44.1 million at December 31, 2013. The general portion of the allowance for loan and lease losses increased by $4.1 million during the six months endedJune 30, 2014, in part as a result of growth in the commercial real estate and equipment financing portfolios partially offset by the decrease in the indirect auto portfolio.

Specific Allowance

The specific allowance for loan and lease losses was $1.1 million at June 30, 2014, compared to $1.5 million at December 31, 2013. The specific allowance decreased by $0.4 million during the six months endedJune 30, 2014, largely as a result of improved credit quality and higher collateral value underlying those impaired loans and leases.

19

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Unallocated Allowance

The unallocated allowance for loan and lease losses was $2.4 million at June 30, 2014, compared to $2.9 million at December 31, 2013. The unallocated portion of the allowance for loan and lease losses decreased by $0.5 million during the six months endedJune 30, 2014, largely as the result of improved credit quality and loss history.

Credit Quality Assessment

At the time of loan origination, a rating is assigned based on the financial strength of the borrower and the value of assets pledged as collateral. The Company continually monitors the asset quality of the loan portfolio using all available information. The officer responsible for handling each loan is required to initiate changes to risk ratings when changes in facts and circumstances occur that warrant an upgrade or downgrade in a loan rating. Based on this information, loans demonstrating certain payment issues or other weaknesses may be categorized as delinquent, impaired, nonperforming and/or put on nonaccrual status. Additionally, in the course of resolving such loans, the Company may choose to restructure the contractual terms of certain loans to match the borrower’s ability to repay the loan based on their current financial condition. If a restructured loan meets certain criteria, it may be categorized as a troubled debt restructuring.

The Company reviews numerous credit quality indicators when assessing the risk in its loan portfolio. For the commercial real estate mortgage, multi-family mortgage, construction, commercial, equipment financing, condominium association and other consumer loan and lease classes, the Company utilizes an eight-grade loan rating system, which assigns a risk rating to each borrower based on a number of quantitative and qualitative factors associated with a loan transaction. Factors considered include industry and market conditions; position within the industry; earnings trends; operating cash flow; asset/liability values; debt capacity; guarantor strength; management and controls; financial reporting; collateral; and other considerations. In addition, the Company’s independent loan review group evaluates the credit quality and related risk ratings of the commercial real estate and commercial loan portfolios. The results of these reviews are reported to the Board of Directors. For consumer loans, the Company primarily relies on payment status for monitoring credit risk.

The ratings categories used for assessing credit risk in the commercial real estate mortgage, multi-family mortgage, construction, commercial, equipment financing, condominium association and other consumer loan and lease classes are defined as follows:

1-4 Rating — Pass

Loan rating grades “1” through “4” are classified as “Pass,” which indicates borrowers are performing in accordance with the terms of the loan and are less likely to result in loss due to the capacity of the borrower to pay and the adequacy of the value of assets pledged as collateral.

5 Rating — Other Asset Especially Mentioned (“OAEM”)

Borrowers exhibit potential credit weaknesses or downward trends deserving management’s attention. If not checked or corrected, these trends will weaken the Company’s asset and position. While potentially weak, currently these borrowers are marginally acceptable; no loss of principal or interest is envisioned.

6 Rating — Substandard

Borrowers exhibit well-defined weaknesses that jeopardize the orderly liquidation of debt. Substandard loans may be inadequately protected by the current net worth and paying capacity of the obligors or by the collateral pledged, if any. Normal repayment from the borrower is in jeopardy. Although no loss of principal is envisioned, there is a distinct possibility that a partial loss of interest and/or principal will occur if the deficiencies are not corrected. Collateral coverage may be inadequate to cover the principal obligation.

20

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

7 Rating — Doubtful

Borrowers exhibit well-defined weaknesses that jeopardize the orderly liquidation of debt with the added provision that the weaknesses make collection of the debt in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Serious problems exist to the point where partial loss of principal is likely.

8 Rating — Definite Loss

Borrowers deemed incapable of repayment. Loans to such borrowers are considered uncollectable and of such little value that continuation as active assets of the Company is not warranted.

Assets rated as “OAEM,” “substandard” or “doubtful” based on criteria established under banking regulations are collectively referred to as “criticized” assets.

Credit Quality Information

The following tables present the recorded investment in loans in each class at June 30, 2014 by credit quality indicator.

	At June 30, 2014
	Commercial Real Estate Mortgage		Multi- Family Mortgage		Construction		Commercial		Equipment Financing		Condominium Association		Other Consumer
	(In Thousands)
Originated:
Loan rating:
Pass	$	1,220,046	$	561,705	$	125,940	$	359,654	$	529,588	$	45,608	$	14,332
OAEM	8,685		367		—		8,853		1,082		—		—
Substandard	1,052		—		—		1,011		3,002		—		11
Doubtful	—		—		—		1,295		589		—		—
Total originated	1,229,783		562,072		125,940		370,813		534,261		45,608		14,343
Acquired:
Loan rating:
Pass	301,358		63,085		11,523		96,171		18,123		—		689
OAEM	4,569		2,553		268		2,468		33		—		—
Substandard	9,727		3,661		—		9,256		72		—		12
Doubtful	46		—		—		148		—		—		—
Total acquired	315,700		69,299		11,791		108,043		18,228		—		701
Total loans	$	1,545,483	$	631,371	$	137,731	$	478,856	$	552,489	$	45,608	$	15,044

At June 30, 2014, there were no loans categorized as definite loss.

21

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	At June 30, 2014
	Indirect Automobile
	(In Thousands)		(Percent)
Originated:
Credit score:
Over 700	$	312,755	83.1	%
661-700	50,960		13.6	%
660 and below	11,083		2.9	%
Data not available	1,516		0.4	%
Total loans	$	376,314	100.0	%

	At June 30, 2014
	Residential Mortgage				Home Equity
	(In Thousands)		(Percent)		(In Thousands)		(Percent)
Originated:
Loan-to-value ratio:
Less than 50%	$	104,052	18.9	%	$	92,667	34.3	%
50% - 69%	155,284		28.2	%	33,727		12.5	%
70% - 79%	150,649		27.3	%	23,972		8.9	%
80% and over	29,114		5.3	%	3,823		1.4	%
Data not available	3,452		0.6	%	933		0.3	%
Total originated	442,551		80.3	%	155,122		57.4	%
Acquired:
Loan-to-value ratio:
Less than 50%	20,075		3.7	%	76,631		28.4	%
50% - 69%	37,392		6.8	%	24,276		9.0	%
70% - 79%	27,166		4.9	%	11,973		4.4	%
80% and over	19,167		3.5	%	1,483		0.5	%
Data not available	4,463		0.8	%	718		0.3	%
Total acquired	108,263		19.7	%	115,081		42.6	%
Total loans	$	550,814	100.0	%	$	270,203	100.0	%

22

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

The following tables present the recorded investment in loans in each class at December 31, 2013 by credit quality indicator.

	At December 31, 2013
	Commercial Real Estate Mortgage		Multi- Family Mortgage		Construction		Commercial		Equipment Financing		Condominium Association		Other Consumer
	(In Thousands)
Originated:
Loan rating:
Pass	$	1,099,108	$	554,183	$	102,927	$	295,057	$	479,811	$	44,793	$	5,528
OAEM	11,555		372		—		49		625		—		—
Substandard	1,087		—		—		1,078		4,817		1		4
Doubtful	—		—		—		1,500		77		—		—
Total originated	1,111,750		554,555		102,927		297,684		485,330		44,794		5,532
Acquired:
Loan rating:
Pass	332,145		69,310		10,090		96,779		27,535		—		1,509
OAEM	7,556		463		688		4,617		61		—		—
Substandard	8,645		3,605		—		8,518		98		—		14
Doubtful	1,889		—		—		194		—		—		—
Total acquired	350,235		73,378		10,778		110,108		27,694		—		1,523
Total loans	$	1,461,985	$	627,933	$	113,705	$	407,792	$	513,024	$	44,794	$	7,055

At December 31, 2013, there were no loans categorized as definite loss.

	At December 31, 2013
	Indirect Automobile
	(In Thousands)		(Percent)
Originated:
Credit score:
Over 700	$	332,140	82.9	%
661-700	54,038		13.5	%
660 and below	12,793		3.2	%
Data not available	1,560		0.4	%
Total loans	$	400,531	100.0	%

23

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	At December 31, 2013
	Residential Mortgage				Home Equity
	(In Thousands)		(Percent)		(In Thousands)		(Percent)
Originated:
Loan-to-value ratio:
Less than 50%	$	94,500	17.9	%	$	75,372	29.3	%
50% - 69%	149,969		28.4	%	31,504		12.2	%
70% - 79%	139,960		26.5	%	21,161		8.2	%
80% and over	22,772		4.3	%	3,240		1.3	%
Data not available	4,353		0.8	%	1,119		0.4	%
Total originated	411,554		77.9	%	132,396		51.4	%
Acquired:
Loan-to-value ratio:
Less than 50%	23,101		4.4	%	84,272		32.7	%
50% - 69%	39,298		7.4	%	25,964		10.1	%
70% - 79%	31,932		6.0	%	13,390		5.2	%
80% and over	19,870		3.8	%	1,208		0.5	%
Data not available	2,430		0.5	%	231		0.1	%
Total acquired	116,631		22.1	%	125,065		48.6	%
Total loans	$	528,185	100.0	%	$	257,461	100.0	%

24

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Age Analysis of Past Due Loans and Leases

The following tables present an age analysis of the recorded investment in total loans and leases at June 30, 2014 and December 31, 2013.

	At June 30, 2014
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Originated:
Commercial real estate loans:
Commercial real estate mortgage	$	—	$	888	$	164	$	1,052	$	1,228,731	$	1,229,783	$	—	$	1,052
Multi-family mortgage	—		—		71		71		562,001		562,072		71		—
Construction	—		—		—		—		125,940		125,940		—		—
Total commercial real estate loans	—		888		235		1,123		1,916,672		1,917,795		71		1,052
Commercial loans and leases:
Commercial	1,657		355		1,296		3,308		367,505		370,813		—		1,339
Equipment financing	1,199		526		2,098		3,823		530,438		534,261		122		3,251
Condominium association	139		—		—		139		45,469		45,608		—		—
Total commercial loans and leases	2,995		881		3,394		7,270		943,412		950,682		122		4,590
Indirect automobile	4,754		579		19		5,352		370,962		376,314		2		325
Consumer loans:
Residential mortgage	493		—		29		522		442,029		442,551		—		1,393
Home equity	100		21		—		121		155,001		155,122		—		404
Other consumer	13		4		15		32		14,311		14,343		—		15
Total consumer loans	606		25		44		675		611,341		612,016		—		1,812
Total originated loans and leases	$	8,355	$	2,373	$	3,692	$	14,420	$	3,842,387	$	3,856,807	$	195	$	7,779

25

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	At June 30, 2014
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Acquired:
Commercial real estate loans:
Commercial real estate mortgage	$	3,754	$	362	$	2,122	$	6,238	$	309,462	$	315,700	$	1,627	$	1,959
Multi-family mortgage	1,012		—		1,296		2,308		66,991		69,299		1,296		—
Construction	268		—		—		268		11,523		11,791		—		—
Total commercial real estate loans	5,034		362		3,418		8,814		387,976		396,790		2,923		1,959
Commercial loans and leases:
Commercial	383		300		3,315		3,998		104,045		108,043		864		5,044
Equipment financing	—		35		72		107		18,121		18,228		73		—
Total commercial loans and leases	383		335		3,387		4,105		122,166		126,271		937		5,044
Consumer loans:
Residential mortgage	456		53		3,090		3,599		104,664		108,263		2,428		991
Home equity	764		1,049		783		2,596		112,485		115,081		170		1,367
Other consumer	1		10		16		27		674		701		—		21
Total consumer loans	1,221		1,112		3,889		6,222		217,823		224,045		2,598		2,379
Total acquired loans and leases	$	6,638	$	1,809	$	10,694	$	19,141	$	727,965	$	747,106	$	6,458	$	9,382
Total loans and leases	$	14,993	$	4,182	$	14,386	$	33,561	$	4,570,352	$	4,603,913	$	6,653	$	17,161

26

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	At December 31, 2013
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Originated:
Commercial real estate loans:
Commercial real estate mortgage	$	4,896	$	1,393	$	169	$	6,458	$	1,105,292	$	1,111,750	$	—	$	169
Multi-family mortgage	14,400		—		—		14,400		540,155		554,555		—		—
Construction	—		—		—		—		102,927		102,927		—		—
Total commercial real estate loans	19,296		1,393		169		20,858		1,748,374		1,769,232		—		169
Commercial loans and leases:
Commercial	2,288		75		842		3,205		294,479		297,684		—		1,551
Equipment financing	867		1,558		2,031		4,456		480,874		485,330		—		4,086
Condominium association	—		—		—		—		44,794		44,794		—		1
Total commercial loans and leases	3,155		1,633		2,873		7,661		820,147		827,808		—		5,638
Indirect automobile	5,407		857		229		6,493		394,038		400,531		10		259
Consumer loans:
Residential mortgage	201		—		415		616		410,938		411,554		—		1,713
Home equity	218		—		—		218		132,178		132,396		—		462
Other consumer	11		1		4		16		5,516		5,532		—		4
Total consumer loans	430		1		419		850		548,632		549,482		—		2,179
Total originated loans and leases	$	28,288	$	3,884	$	3,690	$	35,862	$	3,511,191	$	3,547,053	$	10	$	8,245

27

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	At December 31, 2013
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Acquired:
Commercial real estate loans:
Commercial real estate mortgage	$	1,221	$	87	$	4,887	$	6,195	$	344,040	$	350,235	$	3,958	$	929
Multi-family mortgage	327		—		1,052		1,379		71,999		73,378		1,052		—
Construction	—		409		—		409		10,369		10,778		—		—
Total commercial real estate loans	1,548		496		5,939		7,983		426,408		434,391		5,010		929
Commercial loans and leases:
Commercial	2,707		121		1,931		4,759		105,349		110,108		1,235		4,597
Equipment financing	46		41		73		160		27,534		27,694		73		29
Total commercial loans and leases	2,753		162		2,004		4,919		132,883		137,802		1,308		4,626
Consumer loans:
Residential mortgage	271		777		5,329		6,377		110,254		116,631		4,468		1,162
Home equity	1,259		552		895		2,706		122,359		125,065		117		1,525
Other consumer	6		11		4		21		1,502		1,523		—		14
Total consumer loans	1,536		1,340		6,228		9,104		234,115		243,219		4,585		2,701
Total acquired loans and leases	$	5,837	$	1,998	$	14,171	$	22,006	$	793,406	$	815,412	$	10,903	$	8,256
Total loan and leases	$	34,125	$	5,882	$	17,861	$	57,868	$	4,304,597	$	4,362,465	$	10,913	$	16,501

Commercial Real Estate Loans — At June 30, 2014, loans outstanding in the three classes within this segment expressed as a percentage of total loans and leases outstanding were as follows: commercial real estate mortgage loans — 33.6%; multi-family mortgage loans — 13.7%; and construction loans — 3.0%.

Loans in this portfolio that are on nonaccrual status and/or risk-rated “substandard” or worse are evaluated on an individual loan basis for impairment. For non-impaired commercial real estate loans, loss factors are applied to outstanding loans by risk rating for each of the three classes in the portfolio. The factors applied are based primarily on historic loan loss experience and an assessment of internal and external factors and other relevant information.

Commercial Loans and Leases — At June 30, 2014, loans and leases outstanding in the three classes within this segment expressed as a percent of total loans and leases outstanding were as follows: commercial loans and leases — 10.4%; equipment financing loans — 12.0%; and loans to condominium associations — 1.0%.

Loans and leases in this portfolio that are on nonaccrual status and/or risk-rated “substandard” or worse are evaluated on an individual basis for impairment. For non-impaired commercial loans and leases, loss factors are applied to outstanding loans by risk rating for each of the three classes in the portfolio.

Indirect Automobile Loans — At June 30, 2014, indirect automobile loans represented 8.2% of the Company’s total loan and lease portfolio. Determination of the allowance for loan and lease losses for this portfolio is based primarily on payment status and historical loss rates.

28

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Consumer Loans — At June 30, 2014, loans outstanding within the three classes within this segment expressed as a percent of total loans and leases outstanding were as follows: residential mortgage loans — 11.9%; home equity loans — 5.9%; and other consumer loans — 0.3%.

Significant risk characteristics related to the residential mortgage and home equity loan portfolios are the geographic concentration of the properties financed within selected communities in the greater Boston and Providence metropolitan areas and the economic conditions in those areas as previously commented upon in the “Commercial Real Estate Loans” subsection above. The payment status and loan-to-value ratio are the primary credit quality indicators used for residential mortgage loans and home equity loans. Generally, loans are not made when the loan-to-value ratio exceeds 80% unless private mortgage insurance is obtained and/or there is a financially strong guarantor. Consumer loans that become 90 days or more past due, or are placed on nonaccrual regardless of past due status, are reviewed on an individual basis for impairment by assessing the net realizable value of underlying collateral and the economic condition of the borrower.

Impaired Loans and Leases

When the ultimate collectability of the total principal of an impaired loan or lease is in doubt and the loan is on nonaccrual status, all payments are applied to principal, under the cost recovery method. When the ultimate collectability of the total principal of an impaired loan or lease is not in doubt and the loan or lease is on nonaccrual status, contractual interest is credited to interest income when received, under the cash basis method.

The following tables include the recorded investment and unpaid principal balances of impaired loans and leases with the related allowance amount, if applicable, for the originated and acquired loan and lease portfolios at the dates indicated. Also presented are the average recorded investments in the impaired loans and leases and the related amount of interest recognized during the period that the impaired loans were impaired.

29

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	At June 30, 2014						At December 31, 2013
	Recorded Investment (1)		Unpaid Principal Balance		Related Allowance		Recorded Investment (2)		Unpaid Principal Balance		Related Allowance
	(In Thousands)
Originated:
With no related allowance recorded:
Commercial real estate	$	944	$	944	$	—	$	2,009	$	2,009	$	—
Commercial	5,487		5,507		—		4,410		4,399		—
Consumer	78		78		—		989		987		—
Total originated with no related allowance recorded	6,509		6,529		—		7,408		7,395		—
With an allowance recorded:
Commercial real estate	2,808		2,808		47		1,466		1,466		184
Commercial	3,486		3,457		820		2,393		2,383		675
Consumer	3,571		3,561		—		2,448		2,440		323
Total originated with an allowance recorded	9,865		9,826		867		6,307		6,289		1,182
Total originated impaired loans and leases	16,374		16,355		867		13,715		13,684		1,182
Acquired:
With no related allowance recorded:
Commercial real estate	19,870		20,375		—		9,176		10,082		—
Commercial	6,685		6,786		—		6,988		7,248		—
Consumer	4,817		4,817		—		1,033		1,037		—
Total acquired with no related allowance recorded	31,372		31,978		—		17,197		18,367		—
With an allowance recorded:
Commercial real estate	1,521		1,548		50		1,274		1,291		122
Commercial	1,982		2,143		149		1,020		1,067		169
Consumer	707		707		34		—		—		—
Total acquired with an allowance recorded	4,210		4,398		233		2,294		2,358		291
Total acquired impaired loans and leases	35,582		36,376		233		19,491		20,725		291
Total impaired loans and leases	$	51,956	$	52,731	$	1,100	$	33,206	$	34,409	$	1,473

⁽¹⁾Includes originated and acquired nonaccrual loans of $6.1 million and $8.9 million at June 30, 2014, respectively.

⁽²⁾Includes originated and acquired nonaccrual loans of $5.8 million and $5.7 million at December 31, 2013, respectively.

30

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	Three Months Ended
	June 30, 2014				June 30, 2013
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
	(In Thousands)
Originated:
With no related allowance recorded:
Commercial real estate	$	947	$	12	$	1,939	$	30
Commercial	5,711		62		3,139		29
Consumer	128		—		1,323		18
Total originated with no related allowance recorded	6,786		74		6,401		77
With an allowance recorded:
Commercial real estate	3,010		22		1,256		10
Commercial	3,800		24		1,682		6
Consumer	3,582		15		2,681		35
Total originated with an allowance recorded	10,392		61		5,619		51
Total originated impaired loans and leases	17,178		135		12,020		128
Acquired:
With no related allowance recorded:
Commercial real estate	20,402		182		3,217		88
Commercial	6,775		23		1,548		26
Consumer	4,807		5		317		8
Total acquired with no related allowance recorded	31,984		210		5,082		122
With an allowance recorded:
Commercial real estate	1,522		3		3,679		—
Commercial	1,948		14		—		—
Consumer	770		1		—		—
Total acquired with an allowance recorded	4,240		18		3,679		—
Total acquired impaired loans and leases	36,224		228		8,761		122
Total impaired loans and leases	$	53,402	$	363	$	20,781	$	250

31

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	Six Months Ended
	June 30, 2014				June 30, 2013
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
	(In Thousands)
Originated:
With no related allowance recorded:
Commercial real estate	$	2,422	$	48	$	2,695	$	30
Commercial	4,796		70		4,030		60
Consumer	1,980		13		1,328		18
Total originated with no related allowance recorded	9,198		131		8,053		108
With an allowance recorded:
Commercial real estate	1,587		22		1,469		17
Commercial	3,728		48		1,686		7
Consumer	1,940		15		3,475		39
Total originated with an allowance recorded	7,255		85		6,630		63
Total originated impaired loans and leases	16,453		216		14,683		171
Acquired:
With no related allowance recorded:
Commercial real estate	13,990		228		11,291		99
Commercial	7,498		59		4,369		66
Consumer	6,539		10		1,489		8
Total acquired with no related allowance recorded	28,027		297		17,149		173
With an allowance recorded:
Commercial real estate	2,971		40		3,700		—
Commercial	1,247		15		631		—
Consumer	385		1		—		—
Total acquired with an allowance recorded	4,603		56		4,331		—
Total acquired impaired loans and leases	32,630		353		21,480		173
Total impaired loans and leases	$	49,083	$	569	$	36,163	$	344

32

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

The following tables present information regarding impaired and non-impaired loans and leases at the dates indicated:

	At June 30, 2014
	Commercial Real Estate			Commercial		Indirect Automobile		Consumer		Unallocated		Total
	(In Thousands)
Allowance for Loan and Lease Losses:
Originated:
Individually evaluated for impairment	$	47		$	820	$	—	$	—	$	—	$	867
Collectively evaluated for impairment	26,152			14,564		3,686		2,768		2,402		49,572
Total originated loans and leases	26,199			15,384		3,686		2,768		2,402		50,439
Acquired:
Individually evaluated for impairment	—			59		—		34		—		93
Collectively evaluated for impairment	(53		)	217		—		2		—		166
Acquired with deteriorated credit quality	569			206		—		213		—		988
Total acquired loans and leases	516			482		—		249		—		1,247
Total allowance for loan and lease losses	$	26,715		$	15,866	$	3,686	$	3,017	$	2,402	$	51,686
Loans and Leases:
Originated:
Individually evaluated for impairment	$	3,753		$	8,974	$	—	$	3,648	$	—	$	16,375
Collectively evaluated for impairment	1,914,042			941,708		376,314		608,368		—		3,840,432
Total originated loans and leases	1,917,795			950,682		376,314		612,016		—		3,856,807
Acquired:
Individually evaluated for impairment	1,355			4,707		—		2,327		—		8,389
Collectively evaluated for impairment	127,603			90,418		—		147,840		—		365,861
Acquired with deteriorated credit quality	267,832			31,146		—		73,878		—		372,856
Total acquired loans and leases	396,790			126,271		—		224,045		—		747,106
Total loans and leases	$	2,314,585		$	1,076,953	$	376,314	$	836,061	$	—	$	4,603,913

33

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	At December 31, 2013
	Commercial Real Estate			Commercial		Indirect Automobile		Consumer		Unallocated		Total
	(In Thousands)
Allowance for Loan and Lease Losses:
Originated:
Individually evaluated for impairment	$	184		$	675	$	—	$	323	$	—	$	1,182
Collectively evaluated for impairment	22,336			14,056		3,924		2,414		2,932		45,662
Total originated loans and leases	22,520			14,731		3,924		2,737		2,932		46,844
Acquired:
Individually evaluated for impairment	—			3		—		—		—		3
Collectively evaluated for impairment	(54		)	234		—		204		—		384
Acquired with deteriorated credit quality	556			252		—		434		—		1,242
Total acquired loans and leases	502			489		—		638		—		1,629
Total allowance for loan and lease losses	$	23,022		$	15,220	$	3,924	$	3,375	$	2,932	$	48,473
Loans and Leases:
Originated:
Individually evaluated for impairment	$	3,643		$	6,634	$	—	$	3,438	$	—	$	13,715
Collectively evaluated for impairment	1,765,589			821,174		400,531		546,044		—		3,533,338
Total originated loans and leases	1,769,232			827,808		400,531		549,482		—		3,547,053
Acquired:
Individually evaluated for impairment	2,625			4,878		—		872		—		8,375
Collectively evaluated for impairment	145,057			93,565		—		162,595		—		401,217
Acquired with deteriorated credit quality	286,709			39,359		—		79,752		—		405,820
Total acquired loans and leases	434,391			137,802		—		243,219		—		815,412
Total loans and leases	$	2,203,623		$	965,610	$	400,531	$	792,701	$	—	$	4,362,465

34

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Troubled Debt Restructured Loans and Leases

The recorded investment in troubled debt restructurings and the associated specific allowances for loan and lease losses, in the originated and acquired loan and lease portfolios, are as follows for the periods indicated.

	At and for the Three Months Ended June 30, 2014
	Recorded Investment					Specific				Defaulted
	Number of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial	2	$	390	$	365	$	17	$	17	$	—	—	—
Equipment financing	1	289		289		—		—		—		1	259
Residential mortgage	1	291		291		—		—		—		—	—
Total Originated	4	970		945		17		17		—		1	259
Acquired:
Commercial	2	253		261		9		261		—		—	—
Total Acquired	2	253		261		9		261		—		—	—
Total	6	$	1,223	$	1,206	$	26	$	278	$	—	1	$	259

	At and for the Three Months Ended June 30, 2013
	Recorded Investment					Specific				Defaulted
	Number  of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial	—	$	—	$	—	$	—	$	—	$	—	2	$	1,714
Equipment financing	2	488		498		12		372		—		1	303
Residential mortgage	—	—		—		—		—		—		1	373
Total Originated	2	488		498		12		372		—		4	2,390
Acquired:
Commercial	1	424		421		—		421		—		—	—
Total Acquired	1	424		421		—		421		—		—	—
Total	3	$	912	$	919	$	12	$	793	$	—	4	$	2,390

35

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	At and for the Six Months Ended June 30, 2014
	Recorded Investment					Specific				Defaulted
	Number of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial real estate mortgage	1	$	953	$	944	$	—	$	—	$	—	—	$	—
Commercial	2	390		365		17		17		—		—	—
Equipment financing	2	673		671		—		—		—		3	349
Residential mortgage	2	789		786		—		495		—		—	—
Total Originated	7	2,805		2,766		17		512		—		3	349
Acquired:
Commercial	2	253		261		9		261		—		—	—
Total Acquired	2	253		261		9		261		—		—	—
Total	9	$	3,058	$	3,027	$	26	$	773	$	—	3	$	349

	At and for the Six Months Ended June 30, 2013
	Recorded Investment					Specific				Defaulted
	Number of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial real estate mortgage	1	$	1,039	$	—	$	—	$	—	$	—	—	$	—
Equipment financing	8	1,125		1,129		42		372		—		—	—
Residential mortgage	1	415		372		—		—		—		—	—
Total Originated	10	2,579		1,501		42		372		—		—	—
Acquired:
Commercial	1	424		421		—		421		—		—	—
Total Acquired	1	424		421		—		421		—		—	—
Total	11	$	3,003	$	1,922	$	42	$	793	$	—	—	$	—

36

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

The following table sets forth the Company’s balances of troubled debt restructurings that were modified at the dates indicated, by type of modification.

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In Thousands)
Loans with one modification:
Extended maturity	$	609	$	—	$	609	$	—
Adjusted principal	—		—		—		372
Adjusted interest rate	—		793		878		793
Interest only	17		—		17		—
Combination maturity, principal, interest rate	—		126		—		757
Total loans with one modification	$	626	$	919	$	1,504	$	1,922
Loans with more than one modification:
Extended maturity	$	289	$	—	$	1,233	$	—
Interest only	291		—		291		—
Total loans with more than one modification	$	580	$	—	$	1,524	$	—

The financial impact of the modification of performing and nonperforming loans and leases for the three months ended June 30, 2014 and 2013 was $0.1 million and $0.3 million, respectively. The financial impact of the modification of performing or nonperforming loans and leases for the six months ended June 30, 2014 and 2013 was also $0.1 million and $0.3 million, respectively.

As of June 30, 2014 and 2013, there were no commitments to lend funds to debtors owing receivables whose terms had been modified in troubled debt restructurings.

(6)  Premises and Equipment

In January 2014, the Company completed a transaction to sell a facility located in Brookline, MA, for $2.2 million. The carrying value of the property, including land, building, and furniture, fixtures, and equipment, was $0.4 million. After costs to sell of $0.2 million, the Company recorded a gain on sale in the amount of $1.6 million during the six months endedJune 30, 2014, which is included in gain on sale/disposals of premises and equipment, net in the Company’s unaudited consolidated statements of income.

(7)Goodwill and Other Intangible Assets

The following table sets forth the composition of goodwill and other intangible assets at the dates indicated:

	At June 30, 2014		At December 31, 2013
	(In Thousands)
Goodwill	$	137,890	$	137,890
Other intangible assets:
Core deposits	14,110		15,777
Trade name	1,089		1,089
Trust relationship	—		21
Total other intangible assets	15,199		16,887
Total goodwill and other intangible assets	$	153,089	$	154,777

As of December 31, 2013, the Company has concluded that the BankRI name will continue to be utilized in its marketing strategies; therefore, the trade name with a carrying value of $1.1 million has an indefinite life and ceased to amortize.  

37

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

The estimated aggregate future amortization expense (in thousands) for intangible assets with a finite life remaining at June 30, 2014 is as follows:

Remainder of 2014	$	1,436
Year ending:
2015	2,868
2016	2,457
2017	1,858
2018	1,836
Thereafter	3,655
Total	$	14,110

(8)Comprehensive Income/(Loss)

Comprehensive income (loss) represents the sum of net income (loss) and other comprehensive income (loss). For the three months and six months endedJune 30, 2014 and June 30, 2013, the Company’s other comprehensive income (loss) include the following two components: (i) unrealized holding gains (losses) on investment securities available-for-sale; and (ii) adjustment of accumulated obligation for postretirement benefits.

Changes in accumulated other comprehensive (loss) income by component, net of tax, were as follows for the periods indicated:

	Three Months Ended June 30, 2014
	Investment Securities Available-for-Sale			Postretirement Benefits		Accumulated Other Comprehensive Income
	(In Thousands)
Balance at March 31, 2014	$	(6,301	)	$	365	$	(5,936	)
Other comprehensive income	2,727			—		2,727
Balance at June 30, 2014	$	(3,574	)	$	365	$	(3,209	)

	Three Months Ended June 30, 2013
	Investment Securities  Available-for-Sale			Postretirement Benefits		Accumulated Other Comprehensive Income
	(In Thousands)
Balance at March 31, 2013	$	2,108		$	125	$	2,233
Other comprehensive (loss) income	(6,680		)	6		(6,674		)
Balance at June 30, 2013	$	(4,572	)	$	131	$	(4,441	)

	Six Months Ended June 30, 2014
	Investment Securities Available-for-Sale			Postretirement Benefits			Accumulated Other Comprehensive Income
	(In Thousands)
Balance at December 31, 2013	$	(8,332	)	$	417		$	(7,915	)
Other comprehensive income (loss)	4,758			(52		)	4,706
Balance at June 30, 2014	$	(3,574	)	$	365		$	(3,209	)

38

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	Six Months Ended June 30, 2013
	Investment Securities Available-for-Sale			Postretirement Benefits		Accumulated Other Comprehensive Income
	(In Thousands)
Balance at December 31, 2012	$	3,358		$	125	$	3,483
Other comprehensive (loss) income	(7,930		)	6		(7,924		)
Balance at June 30, 2013	$	(4,572	)	$	131	$	(4,441	)

The following is a summary of the amounts reclassified from accumulated other comprehensive income (loss) for the three months or six months endedJune 30, 2014.

	Three Months Ended			Six Months Ended			Income Statement Line Affected by Reclassification
	June 30, 2014			June 30, 2014
	(In Thousands)
Other comprehensive income (loss) component
Unrealized gains (losses) on investment securities available-for-sale	$	(13	)	$	(13	)	Loss on sales of securities, net
	5			5			Provision for income taxes
Total reclassifications for the period	$	(8	)	$	(8	)	Net income

The Company did not reclassify any amounts out of accumulated other comprehensive income (loss) for the three months or six months endedJune 30, 2013.

(9)       Derivatives and Hedging Activities

The Company may use interest-rate contracts (swaps, caps and floors) as part of interest-rate risk management strategy. Interest-rate swap, cap and floor agreements are entered into as hedges against future interest-rate fluctuations on specifically identified assets or liabilities. The Company did not have derivative fair value hedges or derivative cash flow hedges at June 30, 2014 or December 31, 2013.

Derivatives not designated as hedges are not speculative but rather, result from a service the Company provides to certain customers for a fee. The Company executes interest-rate swaps with commercial banking customers to aid them in managing their interest-rate risk. The interest-rate swap contracts allow the commercial banking customers to convert floating-rate loan payments to fixed-rate loan payments. The Company concurrently enters into offsetting swaps with a third-party financial institution, effectively minimizing its net risk exposure resulting from such transactions. The third-party financial institution exchanges the customer’s fixed-rate loan payments for floating-rate loan payments. As the interest-rate swaps associated with this program do not meet hedge accounting requirements, changes in the fair value of both the customer swaps and the offsetting swaps are recognized directly in earnings. The Company had 10 interest-rate swaps related to this program with an aggregate notional amount of $28.0 million at June 30, 2014, compared with 8 interest-rate swaps with an aggregate notional amount of $22.4 million at December 31, 2013.

39

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

The table below presents the fair value and classification of the Company’s derivative financial instruments on the consolidated balance sheets at June 30, 2014 and December 31, 2013, and the effect of the Company’s derivative financial instruments on the consolidated statements of income for the three months and six months endedJune 30, 2014 and June 30, 2013. Asset derivatives and liability derivatives are included in other assets and accrued expenses and other liabilities on the consolidated balance sheets, respectively. Changes in the fair value are recognized directly in earnings and are included in other non-interest income in the consolidated statements of income.

	At June 30, 2014				At December 31, 2013
	Asset Derivatives		Liability Derivatives		Asset Derivatives		Liability Derivatives
	(In Thousands)
Total derivatives (interest-rate products) not designated as hedging instruments	$	887	$	912	$	825	$	856

	Three Months Ended June 30,					Six Months Ended June 30,
	2014		2013			2014	2013
	(In Thousands)
Gain (loss) recognized in income on derivatives (1)	$	4	$	(22	)	6	$	(25	)

(1) The amount of gain (loss) recognized in income on derivatives represents changes related to the fair value of the interest rate products.

By using derivative financial instruments, the Company exposes itself to credit risk which is the risk of failure by the counterparty to perform under the terms of the derivative contract. When the fair value of a derivative contract is positive, the counterparty owes the Company, which creates credit risk for the Company. When the fair value of a derivative is negative, the Company owes the counterparty and, therefore, it does not possess credit risk. The credit risk in derivative instruments is mitigated by entering into transactions with highly-rated counterparties that management believes to be creditworthy and by limiting the amount of exposure to each counterparty. The Company had limited exposure relating to interest rate swaps with institutional counterparties at June 30, 2014 and December 31, 2013, as all such swaps were in a net liability position and subject to master netting agreements.

The estimated net credit risk exposure for derivative financial instruments was $25.3 thousand and $31.2 thousand at June 30, 2014 and December 31, 2013, respectively.

Certain of the derivative agreements contain provisions that require the Company to post collateral if the derivative exposure exceeds a threshold amount. The Company has posted collateral of $2.8 million in the normal course of business at both June 30, 2014 and December 31, 2013.

The tables below present the offsetting of derivatives and amounts subject to master netting agreements not offset in the unaudited consolidated balance sheet at the dates indicated.

	At June 30, 2014
	Gross Amounts of Recognized Assets /Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets Presented in the Statement of Financial Position		Gross Amounts Not Offset in the Statement of Financial Position				Net Amount
							Financial Instruments		Cash Collateral (Received)/ Posted
	(In Thousands)
Asset Derivatives	$	887	$	—	$	887	$	—	$	—	$	887
Liability Derivatives	$	912	$	—	$	912	$	—	$	2,770	$	3,682

40

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

	At December 31, 2013
	Gross Amounts of Recognized Assets /Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets Presented in the Statement of Financial Position		Gross Amounts Not Offset in the Statement of Financial Position				Net Amount
							Financial Instruments		Cash Collateral (Received) / Posted
	(In Thousands)
Asset Derivatives	$	825	$	—	$	825	$	—	$	—	$	825
Liability Derivatives	$	856	$	—	$	856	$	—	$	2,811	$	3,667

The Company has agreements with certain of its derivative counterparties that contain credit-risk-related contingent

provisions. These provisions provide the counterparty with the right to terminate its derivative positions and require the

Company to settle its obligations under the agreements if the Company defaults on certain of its indebtedness or if the

Company fails to maintain its status as a well-capitalized institution. 

(10)       Stock Based Compensation

As of June 30, 2014, the Company had two active recognition and retention plans: the 2003 Recognition and Retention Plan (the "2003 RRP") with 1,250,000 authorized shares and the 2011 Restricted Stock Award Plan ("2011 RSA") with 500,000 authorized shares. On July 9, 2014, the Company registered the 2014 Equity Incentive Plan ("2014 Plan" and with the 2003 RRP and the 2011 RSA, collectively referred to as the "Plans") with 1,750,000 authorized shares. The purpose of the Plans is to promote the long-term financial success of the Company and its subsidiaries by providing a means to attract, retain and reward individuals who contribute to such success and to further align their interests with those of the Company's stockholders.

Of the awarded shares, 50% vest ratably over three years with one-third of such shares vesting at each of the first, second and third anniversary dates of the awards. These are referred to as "time-based shares". The remaining 50% of each award has a cliff vesting schedule and will vest three years after the award date based on the level of the Company's achievement of identified performance targets in comparison to the level of achievement of such identified performance targets by a defined peer group comprised of 22 financial institutions. These are referred to as "performance-based shares". The specific performance measure targets relate to return on assets, return on equity, asset quality and total return to stockholders (share price appreciation from date of award plus dividends paid as a percent of the Company's common stock share price on the date of award). If a participant leaves the Company prior to the third anniversary date of an award, any unvested shares will be forfeited. Dividends declared with respect to shares awarded will be held by the Company and paid to the participant only when the shares vest.

Under all the Plans, shares of the Company's common stock were reserved for issuance as restricted stock awards to officers, employees, and non-employee directors of the Company. Shares issued upon vesting may be either authorized but unissued shares or reacquired shares held by the Company as treasury shares. Any shares not issued because vesting requirements are not met will again be available for issuance under the Plans.

Total expense for the Plans was $0.6 million and $0.5 million for the six months endedJune 30, 2014 and 2013, respectively.

41

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

(11)Earnings per Share

The following table sets forth a reconciliation of basic and diluted earnings per share (“EPS”) for the periods indicated:

	Three Months Ended
	June 30, 2014				June 30, 2013
	Basic		Fully Diluted		Basic		Fully Diluted
	(In Thousands Except Share Data)
Numerator:
Net income	$	9,976	$	9,976	$	9,490	$	9,490
Denominator:
Weighted average shares outstanding	69,886,576		69,886,576		69,774,703		69,774,703
Effect of dilutive securities	—		125,801		—		58,838
Adjusted weighted average shares outstanding	69,886,576		70,012,377		69,774,703		69,833,541
EPS	$	0.14	$	0.14	$	0.14	$	0.14

	Six Months Ended
	June 30, 2014				June 30, 2013
	Basic		Fully Diluted		Basic		Fully Diluted
	(In Thousands Except Share Data)
Numerator:
Net income	$	20,398	$	20,398	$	18,304	$	18,304
Denominator:
Weighted average shares outstanding	69,881,055		69,881,055		69,768,777		69,768,777
Effect of dilutive securities	—		117,164		—		54,838
Adjusted weighted average shares outstanding	69,881,055		69,998,219		69,768,777		69,823,615
EPS	$	0.29	$	0.29	$	0.26	$	0.26

(12)       Fair Value of Financial Instruments

A description of the valuation methodologies used for assets and liabilities measured at fair value on a recurring and non-recurring basis, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. There were no changes in the valuation techniques used during the three months and six months endedJune 30, 2014 and June 30, 2013.

42

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Assets and Liabilities Recorded at Fair Value on a Recurring Basis

The following tables set forth the carrying value of assets and liabilities measured at fair value on a recurring basis at the dates indicated:

	Carrying Value at June 30, 2014
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets:
Investment securities available-for-sale:
GSEs	$	—	$	15,978	$	—	$	15,978
GSE CMOs	—		247,547		—		247,547
GSE MBSs	—		221,847		—		221,847
SBA commercial loan asset-backed securities	—		226		—		226
Corporate debt obligations	—		40,330		—		40,330
Trust preferred securities	—		1,299		—		1,299
Marketable equity securities	1,359		—		—		1,359
Total investment securities available-for-sale	$	1,359	$	527,227	$	—	$	528,586
Interest-rate swaps	$	—	$	887	$	—	$	887
Liabilities:
Interest-rate swaps	$	—	$	912	$	—	$	912

	Carrying Value at December 31, 2013
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets:
Investment securities available-for-sale:
GSEs	$	—	$	12,180	$	—	$	12,180
GSE CMOs	—		243,644		—		243,644
GSE MBSs	—		199,401		—		199,401
Private-label CMOs	—		3,355		—		3,355
SBA commercial loan asset-backed securities	—		243		—		243
Auction-rate municipal obligations	—		—		1,775		1,775
Municipal obligations	—		1,086		—		1,086
Corporate debt obligations	—		28,224		—		28,224
Trust preferred securities	—		1,210		—		1,210
Marketable equity securities	1,310		—		—		1,310
Total investment securities available-for-sale	$	1,310	$	489,343	$	1,775	$	492,428
Interest-rate swaps	$	—	$	825	$	—	$	825
Liabilities:
Interest-rate swaps	$	—	$	856	$	—	$	856

43

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Investment Securities Available-for-Sale

The fair value of investment securities is based principally on market prices and dealer quotes received from third-party and nationally-recognized pricing services for identical investment securities such as U.S. Treasury and agency securities. The Company's marketable equity securities are priced this way and are included in Level 1. These prices are validated by comparing the primary pricing source with an alternative pricing source when available. When quoted market prices for identical securities are unavailable, the Company uses market prices provided by independent pricing services based on recent trading activity and other observable information, including but not limited to market interest-rate curves, referenced credit spreads and estimated prepayment speeds where applicable. These investments include certain U.S. and government agency debt securities, GSE residential MBSs and CMOs, private-label CMOs, municipal and corporate debt securities, and trust preferred securities, all of which are included in Level 2. Certain fair values estimated using pricing models (such as auction-rate municipal securities) are included in Level 3.

Additionally, management reviews changes in fair value from period to period and performs testing to ensure that prices received from the third parties are consistent with management's expectation of the market. Changes in the prices obtained from the pricing service are analyzed from month to month, taking into consideration changes in market conditions including changes in mortgage spreads, changes in U.S. Treasury security yields and changes in generic pricing of 15-year and 30-year securities. Additional analysis may include a review of prices provided by other independent parties, a yield analysis, a review of average life changes using Bloomberg analytics and a review of historical pricing for a particular security.

Interest-Rate Swaps

The fair values for the interest-rate swap assets and liabilities represent a Level 2 valuation and are based on settlement values adjusted for credit risks associated with the counterparties and the Company and observable market interest rate curves. Credit risk adjustments consider factors such as the likelihood of default by the Company and its counterparties, its net exposures and remaining contractual life. To date, the Company has not realized any losses due to a counterparty’s inability to pay any net uncollateralized position. The change in value of interest-rate swap assets and liabilities attributable to credit risk was not significant during the reported periods. See also Note 9, “Derivatives and Hedging Activities.”

The reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands)
Investment securities available-for-sale, beginning of period	$	1,690		$	2,852		$	1,775		$	2,917
Investment security sales	(1,658		)	—			(1,658		)	—
Principal paydowns and other	—			(207		)	—			(330		)
Total realized losses included in other income	(242		)	—			(242		)	—
Total unrealized losses included in other comprehensive income	210			190			125			248
Investment securities available-for-sale, end of period	$	—		$	2,835		$	—		$	2,835

There were no transfers between levels for assets and liabilities recorded at fair value on a recurring basis during the three months and six months endedJune 30, 2014 and 2013.

44

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Assets and Liabilities Recorded at Fair Value on a Non-Recurring Basis

The table below summarizes assets and liabilities measured at fair value on a non-recurring basis at the dates indicated:

	Carrying Value at June 30, 2014
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets measured at fair value on a non-recurring basis:
Collateral-dependent impaired loans and leases	$	—	$	—	$	4,927	$	4,927
Other real estate owned	—		—		675		675
Repossessed vehicles and equipment	—		571		—		571
Total assets measured at fair value on a non-recurring basis	$	—	$	571	$	5,602	$	6,173

	Carrying Value at December 31, 2013
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets measured at fair value on a non-recurring basis:
Collateral-dependent impaired loans and leases	$	—	$	—	$	12,099	$	12,099
Other real estate owned	—		—		577		577
Repossessed vehicles and equipment	—		1,001		—		1,001
Total assets measured at fair value on a non-recurring basis	$	—	$	1,001	$	12,676	$	13,677

Collateral-Dependent Impaired Loans and Leases

For nonperforming loans and leases where the credit quality of the borrower has deteriorated significantly, fair values of the underlying collateral were estimated using purchase and sales agreements (Level 2), or comparable sales or recent appraisals (Level 3), adjusted for selling costs and other expenses.

Other Real Estate Owned

The Company records other real estate owned at the lower of cost or fair value. In estimating fair value, the Company utilizes purchase and sales agreements (Level 2), or comparable sales, recent appraisals or cash flows discounted at an interest rate commensurate with the risk associated with these cash flows (Level 3), adjusted for selling costs and other expenses.

Repossessed Vehicles and Equipment

Repossessed vehicles and equipment are carried at estimated fair value less costs to sell based on auction pricing (Level 2).

The table below presents quantitative information about significant unobservable inputs (Level 3) for assets measured at fair value on a recurring and non-recurring basis at June 30, 2014.

	Fair Value		Valuation Technique
	(Dollars in Thousands)
Collateral-dependent impaired loans and leases	$	4,927	Appraisal of collateral (1)
Other real estate owned	$	675	Appraisal of collateral (1)

45

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

(1) Fair value is generally determined through independent appraisals of the underlying collateral. The Company may also use another available source of collateral assessment to determine a reasonable estimate of the fair value of the collateral. The valuation generally includes various Level 3 inputs which are not identifiable. Appraisals may be adjusted by management for qualitative factors such as economic factors and estimated liquidation expenses. The range of these possible adjustments may vary.

Summary of Estimated Fair Values of Financial Instruments

The following table presents the carrying amount, estimated fair value, and placement in the fair value hierarchy of the Company’s financial instruments at the dates indicated. This table excludes financial instruments for which the carrying amount approximates fair value. Financial assets for which the fair value approximates carrying value include cash and cash equivalents, FHLBB and FRB stock and accrued interest receivable. Financial liabilities for which the fair value approximates carrying value include non-maturity deposits, short-term borrowings and accrued interest payable.

					Fair Value Measurements
	Carrying Value		Estimated Fair Value		Level 1 Inputs		Level 2 Inputs		Level 3 Inputs
	(In Thousands)
At June 30, 2014
Financial assets:
Investment securities held-to-maturity	$	500	$	500	$	—	$	—	$	500
Loans held-for-sale	13,890		13,890		—		13,890		—
Loans and leases, net	4,552,227		4,522,877		—		—		4,522,877
Financial liabilities:
Certificates of deposit	900,216		903,673		—		903,673		—
Borrowed funds	1,041,004		1,045,320		—		1,045,320		—
At December 31, 2013
Financial assets:
Investment securities held-to-maturity	$	500	$	500	$	—	$	—	$	500
Loans held-for-sale	13,372		13,372		—		13,372		—
Loans and leases, net	4,313,992		4,552,556		—		—		4,552,556
Financial liabilities:
Certificates of deposit	934,668		938,703		—		938,703		—
Borrowed funds	812,555		815,910		—		815,910		—

Investment Securities Held-to-Maturity

The fair values of investment securities held-to-maturity are estimated using pricing models or are based on comparisons to market prices of similar securities and are considered to be Level 3.

Loans Held-for-Sale

Fair value is measured using quoted market prices when available. These assets are typically categorized as Level 1. If quoted market prices are not available, comparable market values may be utilized. These assets are typically categorized as Level 2.

Loans and Leases

The fair values of performing loans and leases were estimated by segregating the portfolio into its primary loan and lease categories—commercial real estate mortgage, multi-family mortgage, construction, commercial, equipment financing, condominium association, indirect automobile, residential mortgage, home equity and other consumer. These categories were

46

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

further disaggregated based on significant financial characteristics such as type of interest rate (fixed / variable) and payment status (current / past-due). The Company discounts the contractual cash flows for each loan category using interest rates currently being offered for loans with similar terms to borrowers of similar quality and incorporates estimates of future loan prepayments. This method of estimating fair value does not incorporate the exit price concept of fair value.

Deposits

The fair values of deposit liabilities with no stated maturity (demand, NOW, savings and money market savings accounts) are equal to the carrying amounts payable on demand. The fair value of certificates of deposit represents contractual cash flows discounted using interest rates currently offered on deposits with similar characteristics and remaining maturities. The fair value estimates for deposits do not include the benefit that results from the low-cost funding provided by the Company’s core deposit relationships (deposit-based intangibles).

Borrowed Funds

The fair value of federal funds purchased is equal to the amount borrowed. The fair value of FHLBB advances and repurchase agreements represents contractual repayments discounted using interest rates currently available for borrowings with similar characteristics and remaining maturities. The fair values reported for retail repurchase agreements are based on the discounted value of contractual cash flows. The discount rates used are representative of approximate rates currently offered on borrowings with similar characteristics and maturities. The fair values reported for subordinated deferrable interest debentures are based on the discounted value of contractual cash flows. The discount rates used are representative of approximate rates currently offered on instruments with similar terms and maturities.

(13)  Commitments and Contingencies

Off-Balance-Sheet Financial Instruments

The Company is party to off-balance-sheet financial instruments in the normal course of business to meet the financing needs of its customers and to reduce its own exposure to fluctuations in interest rates. These financial instruments include loan commitments, standby and commercial letters of credit, and interest-rate swaps. According to GAAP, these financial instruments are not recorded in the financial statements until they are funded or related fees are incurred or received.

The contract amounts reflect the extent of the involvement the Company has in particular classes of these instruments. Such commitments involve, to varying degrees, elements of credit risk and interest-rate risk in excess of the amount recognized in the consolidated balance sheet. The Company’s exposure to credit loss in the event of non-performance by the counterparty is represented by the contractual amount of the instruments. The Company uses the same policies in making commitments and conditional obligations as it does for on-balance-sheet instruments.

47

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Financial instruments with off-balance-sheet risk at the dates indicated follow:

	At June 30, 2014		At December 31, 2013
	(In Thousands)
Financial instruments whose contract amounts represent credit risk:
Commitments to originate loans and leases:
Commercial real estate	$	67,378	$	48,973
Commercial	146,347		143,252
Residential mortgage	10,524		8,027
Unadvanced portion of loans and leases	549,473		586,279
Unused lines of credit:
Home equity	212,857		205,665
Other consumer	6,386		6,503
Other commercial	1,138		1,035
Unused letters of credit:
Financial standby letters of credit	18,322		20,410
Performance standby letters of credit	3,189		2,989
Commercial and similar letters of credit	2,302		440
Back-to-back interest-rate swaps	28,017		22,418

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require the payment of a fee by the customer. Since some of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if any, is based on management’s credit evaluation of the borrower.

Standby and commercial letters of credit are conditional commitments issued by the Company to guarantee performance of a customer to a third party. These standby and commercial letters of credit are primarily issued to support the financing needs of the Company’s commercial customers. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loans to customers.

The liability for unfunded credit commitments, which is included in other liabilities, was $1.2 million at June 30, 2014 and $1.0 million at December 31, 2013.

From time to time the Company enters into back-to-back interest rate swaps with commercial customers and third-party financial institutions. These swaps allow the Company to offer long-term fixed-rate commercial loans while mitigating the interest-rate risk of holding those loans. In a back-to-back interest rate swap transaction, the Company lends to a commercial customer on a floating-rate basis and then enters into an interest rate swap with that customer. Concurrently, the Company enters into offsetting swaps with a third-party financial institution, effectively minimizing its net interest-rate risk exposure resulting from such transactions.

The fair value of interest rate swap assets and liabilities is $0.9 million and $0.9 million, respectively, at June 30, 2014. The fair value of interest rate swap assets and liabilities is $0.8 million and $0.9 million, respectively, at December 31, 2013.

48

BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Lease Commitments

The Company leases certain office space under various noncancellable operating leases. A summary of future minimum rental payments under such leases at the dates indicated follows:

	Minimum Rental Payments
	(In Thousands)
Remainder of 2014	2,695
Year ending:
2015	5,477
2016	5,333
2017	4,804
2018	4,229
Thereafter	15,582
Total	$	38,120

The leases contain escalator clauses for real estate taxes and other expenditures. Total rental expense was $3.6 million during the six months ended June 30, 2014, which included $0.8 million in lease acceleration related to a relocation of an operations center and a closure of a branch property. This compared to $2.5 million during the six months ended June 30, 2013.

Legal Proceedings

In the normal course of business, there are various outstanding legal proceedings. In the opinion of management, after consulting with legal counsel, the consolidated financial position and results of operations of the Company are not expected to be affected by the outcome of such proceedings.

49

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

Certain statements contained in this Quarterly Report on Form 10-Q that are not historical facts may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties. These statements, which are based on certain assumptions and describe Brookline Bancorp, Inc.’s (the “Company’s”) future plans, strategies and expectations, can generally be identified by the use of the words “may,” “will,” “should,” “could,” “would,” “plan,” “potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” “target” and similar expressions. These statements include, among others, statements regarding the Company’s intent, belief or expectations with respect to economic conditions, trends affecting the Company’s financial condition or results of operations, and the Company’s exposure to market, liquidity, interest-rate and credit risk.

Forward-looking statements are based on the current assumptions underlying the statements and other information with respect to the beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions of management and the financial condition, results of operations, future performance and business are only expectations of future results. Although the Company believes that the expectations reflected in the Company’s forward-looking statements are reasonable, the Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among other factors, adverse conditions in the capital and debt markets; changes in interest rates; competitive pressures from other financial institutions; the effects of continuing weakness in general economic conditions on a national basis or in the local markets in which the Company operates, including changes which adversely affect borrowers’ ability to service and repay their loans and leases; changes in the value of securities and other assets in the Company’s investment portfolio; changes in loan and lease default and charge-off rates; the adequacy of allowances for loan and lease losses; deposit levels necessitating increased borrowing to fund loans and investments; changes in government regulation; the risk that goodwill and intangibles recorded in the Company’s financial statements will become impaired; and changes in assumptions used in making such forward-looking statements, as well as the other risks and uncertainties detailed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013 and other filings submitted to the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made. The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

Introduction

The Company, a Delaware corporation, operates as a multi-bank holding company for Brookline Bank and its subsidiaries; Bank Rhode Island (“BankRI”) and its subsidiaries; First Ipswich Bank (“First Ipswich” and formerly known as The First National Bank of Ipswich) and its subsidiaries; and Brookline Securities Corp.

As a commercially-focused financial institution with 48 full-service banking offices throughout Greater Boston, the North Shore of Massachusetts and Rhode Island, the Company, through Brookline Bank, BankRI and First Ipswich (the “Banks”), offers a wide range of commercial, business and retail banking services, including a full complement of cash management products, on-line banking services, consumer and residential loans and investment services, designed to meet the financial needs of small- to mid-sized businesses and individuals throughout Central New England. Specialty lending activities include indirect automobile loans as well as equipment financing primarily in the New York/New Jersey metropolitan area.

The Company focuses its business efforts on profitably growing its commercial lending businesses, both organically and through acquisitions. The Company’s customer focus, multi-bank structure, and risk management are integral to its organic growth strategy and serve to differentiate the Company from its competitors. As full-service financial institutions, the Banks and their subsidiaries focus on the continued acquisition of well-qualified customers, the deepening of long-term banking relationships through a full complement of products and excellent customer service, and strong risk management. The Company’s multi-bank structure retains the local-bank orientation while relieving local bank management of the responsibility for most back-office functions, which are consolidated at the holding-company level. Branding and decision-making, including credit decisioning and pricing, remain largely local in order to better meet the needs of bank customers and further motivate the Banks’ commercial, business and retail bankers.

The Company is supervised, examined and regulated by the Board of Governors of the Federal Reserve System (“FRB”). As Massachusetts-chartered member banks, Brookline Bank and First Ipswich are also subject to regulation under the laws of the Commonwealth of Massachusetts and the jurisdiction of the Massachusetts Division of Banks. As a Rhode Island-chartered member bank, BankRI is also subject to regulation under the laws of the State of Rhode Island and the jurisdiction of the Banking Division of the Rhode Island Department of Business Regulation. The Federal Deposit Insurance Corporation

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("FDIC") continues to insure each of the Banks’ deposits up to $250,000 per depositor. Additionally, all Massachusetts-chartered savings banks are required to be members of the Depositors Insurance Fund (“DIF”), a corporation that insures savings bank deposits in excess of the FDIC insurance limits. As such, Brookline Bank offers 100% insurance on all deposits as a result of a combination of insurance from the FDIC and the DIF.

The Company’s common stock is traded on the Nasdaq Global Select Market^SM under the symbol “BRKL.”

Selected Financial Data

The following is based in part on, and should be read in conjunction with, the consolidated financial statements and accompanying notes, and other information appearing elsewhere in this Form 10-Q.

	At and for the Three Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2014			2014			2013			2013			2013
	(Dollars in Thousands, Except Per Share Data)
PER COMMON SHARE DATA
Earnings per share — Basic	$	0.14		$	0.15		$	0.11		$	0.14		$	0.14
Book value per share (end of period)	8.98			8.88			8.79			8.80			8.76
Tangible book value per share (end of period) (1)	6.79			6.68			6.57			6.57			6.51
Dividends paid per common share	0.085			0.085			0.085			0.085			0.085
Stock price (end of period)	9.37			9.42			9.55			9.40			8.68
PERFORMANCE RATIOS (2)
Net interest margin (taxable equivalent basis)	3.61		%	3.82		%	3.54		%	3.56		%	3.78		%
Return on average assets	0.73		%	0.78		%	0.58		%	0.73		%	0.74		%
Return on average tangible assets (1)	0.75		%	0.80		%	0.60		%	0.75		%	0.76		%
Return on average stockholders’ equity	6.37		%	6.70		%	4.95		%	6.15		%	6.16		%
Return on average tangible stockholders' equity (1)	8.44		%	8.92		%	6.61		%	8.27		%	8.28		%
Dividend payout ratio (1)	59.78		%	57.23		%	77.88		%	63.26		%	62.75		%
Efficiency ratio	62.79		%	63.52		%	65.69		%	63.06		%	63.53		%
ASSET QUALITY RATIOS
Net loan and lease charge-offs as a percentage of average loans and leases (annualized)	0.06		%	0.06		%	0.16		%	0.06		%	0.06		%
Nonperforming loans and leases as a percentage of total loans and leases	0.37		%	0.41		%	0.38		%	0.36		%	0.42		%
Nonperforming assets as a percentage of total assets	0.33		%	0.36		%	0.34		%	0.32		%	0.37		%
Total allowance for loan and lease losses as a percentage of total loans and leases	1.12		%	1.13		%	1.11		%	1.08		%	1.05		%
Allowance for loan and lease losses related to originated loans and leases as a percentage of originated loans and leases (1)	1.31		%	1.33		%	1.32		%	1.31		%	1.34		%
CAPITAL RATIOS
Stockholders’ equity to total assets	11.23		%	11.46		%	11.53		%	11.74		%	11.87		%
Tangible equity ratio (1)	8.73		%	8.87		%	8.88		%	9.03		%	9.10		%
FINANCIAL CONDITION DATA
Total assets	$	5,587,486		$	5,418,785		$	5,325,106		$	5,236,229		$	5,150,480
Total loans and leases	4,603,913			4,461,997			4,362,465			4,299,477			4,205,015
Allowance for loan and lease losses	51,686			50,224			48,473			46,390			44,281
Goodwill and identified intangible assets	153,089			153,916			154,777			155,905			157,058
Total deposits	3,861,147			3,847,650			3,835,006			3,737,978			3,656,981
Total borrowed funds	1,041,004			892,016			812,555			828,802			830,066
Stockholders’ equity	627,663			620,799			613,867			614,811			611,284
EARNINGS DATA
Net interest income	$	46,434		$	47,734		$	43,774		$	43,412		$	45,363
Provision for credit losses	2,276			2,443			3,887			2,748			2,439
Non-interest income	3,290			5,124			3,907			3,453			3,139
Non-interest expense	31,222			33,576			31,320			29,553			30,816
Net income	9,976			10,422			7,654			9,429			9,490

(1) Refer to Non-GAAP Financial Measures and Reconciliations to GAAP.

(2) All performance ratios are annualized and are based on average balance sheet amounts, where applicable.

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Executive Overview

Growth

Total assets of $5.6 billion at June 30, 2014increased$262.4 million, or 9.9%, on an annualized basis from $5.3 billion at December 31, 2013.

The loan and lease portfolio increased$241.4 million, or 11.1%, on an annualized basis to $4.6 billion at June 30, 2014 from $4.4 billion at December 31, 2013. The Company’s commercial loan portfolios, which are comprised of commercial real estate loans and commercial loans and leases, continued to exhibit growth. The Company’s commercial loan portfolios, which total $3.4 billion, or 73.7% of total loans and leases at June 30, 2014, increased$222.3 million, or 14.0% on an annualized basis, from $3.2 billion, or 72.6% of total loans and leases at December 31, 2013. Loan growth in the Company’s commercial loan portfolios was offset by a $24.2 milliondecrease in the indirect automobile portfolio during the same period.

Total deposits of $3.9 billion at June 30, 2014increased slightly from December 31, 2013. Core deposits, defined as the sum of demand checking, NOW, money market, and savings accounts, increased at a 4.2% annualized rate during the first six months of 2014. The Company’s core deposits increased as a percentage of total deposits to 76.7% at June 30, 2014 from 75.6% at December 31, 2013.

Asset Quality

The ratio of the allowance for loan and lease losses to total loans and leases was 1.12% at June 30, 2014, compared to 1.11% at December 31, 2013. The allowance for loan and lease losses related to originated loans and leases as a percentage of total originated loans and leases was 1.31% at June 30, 2014 as compared with 1.32% at December 31, 2013. The Company continued to employ its historical underwriting methodology throughout the six-month period ended June 30, 2014 and continued to calculate its allowance for loan and lease losses on a historically consistent basis adjusting for any improvements in credit quality.

Nonperforming assets at June 30, 2014 totaled $18.4 million or 0.33% of total assets, as compared with $18.1 million, or 0.34% of total assets, at December 31, 2013. Net charge-offs for the three months ended June 30, 2014 were $0.7 million, or 0.06% annualized of average loans and leases, compared to $0.6 million, or 0.06% annualized for the three months ended June 30, 2013.

Capital Strength

The Company remains well-capitalized as defined by its regulatory requirements with capital ratios in excess of all minimum regulatory requirements. The Company’s Tier 1 leverage ratio was 9.23% at June 30, 2014, compared to 9.36% at December 31, 2013. The ratio of stockholders’ equity to total assets was 11.23% and 11.53% at June 30, 2014 and December 31, 2013, respectively. The Company's tangible equity ratio was 8.73% and 8.88% at June 30, 2014 and December 31, 2013, respectively.

Net Income

For the three months ended June 30, 2014, the Company reported net income of $10.0 million, or $0.14 per basic and diluted share, up$0.5 million, or 5.1%, from $9.5 million, or $0.14 per basic and diluted share, for the three months ended June 30, 2013. This increase in net income is primarily the result of an increase in net interest income of $1.1 million, a decrease in the provision for credit losses of $0.2 million, an increase in non-interest income of $0.2 million, offset by an increase in non-interest expense of $0.4 million and an increase in provision for income taxes of $0.4 million. Refer to “Results of Operations" below for further discussion.

For the six months ended June 30, 2014, the Company reported net income of $20.4 million, or $0.29 per basic and diluted share, up$2.1 million, or 11.4%, from $18.3 million, or $0.26 per basic and diluted share, for the six months ended June 30, 2013. This increase in net income is primarily the result of an increase in net interest income of $5.1 million, an increase in non-interest income of $1.9 million, offset by an increase in the provision for credit losses of $0.4 million, an increase in non-interest expense of $3.2 million, and an increase in provision for income taxes of $1.3 million. Refer to “Results of Operations" below for further discussion.

The annualized return on average assets was 0.73% and 0.75% for the three months and six months endedJune 30, 2014, respectively, compared to 0.74% and 0.72% for the three months and six months endedJune 30, 2013, respectively. The

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annualized return on average stockholders’ equity was 6.37% and 6.54% for the three months and six months endedJune 30, 2014, respectively, compared to 6.16% and 5.93% for the three months and six months endedJune 30, 2013, respectively.

Net interest margin was 3.61% and 3.71% for the three months and six months endedJune 30, 2014, respectively, compared to 3.78% and 3.74% for the three months and six months endedJune 30, 2013, respectively. The yield on interest-earning assets was 4.15% for the quarter ended June 30, 2014 compared to 4.41% for the quarter ended June 30, 2013. The yield on interest-earning assets was 4.26% for the six months endedJune 30, 2014 compared to 4.40% for the six months endedJune 30, 2013. The Company’s overall cost of funds (including non-interest-bearing demand checking accounts) decreased10 basis points, to 0.58% for the three months ended June 30, 2014 from 0.68% for the three months ended June 30, 2013. The Company’s overall cost of funds decreased11 basis points, to 0.59% for the six months ended June 30, 2014 from 0.70% for the six months ended June 30, 2013.The Company’s net interest margin will likely continue to be under pressure due to competitive pricing pressure in all loan categories and the continuation of a low interest-rate environment, along with the Company’s diminishing ability to reduce its cost of funds.

Critical Accounting Policies

The SEC defines “critical accounting policies” as those involving significant judgments and difficult or complex assumptions by management, often as a result of the need to make estimates about matters that are inherently uncertain or variable, which have, or could have, a material impact on the carrying value of certain assets or net income. The preparation of financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, income and expenses, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates. As discussed in the Company’s 2013 Annual Report on Form 10-K, management has identified the valuation of available-for-sale securities, accounting for assets and liabilities acquired, the determination of the allowance for loan and lease losses, the review of goodwill and intangibles for impairment, and income tax accounting as the Company’s most critical accounting policies.

Non-GAAP Financial Measures and Reconciliations to GAAP

In addition to evaluating the Company’s results of operations in accordance with GAAP, management periodically supplements this evaluation with an analysis of certain non-GAAP financial measures, such as operating earning metrics, the ratio of the allowance for loan and lease losses related to originated loans and leases as a percentage of originated loans and leases, the tangible equity ratio, tangible book value per share and dividend payout ratio. Management believes that these non-GAAP financial measures provide information useful to investors in understanding the Company’s underlying operating performance and trends, and facilitates comparisons with the performance assessment of financial performance, including non-interest expense control, while the tangible equity ratio and tangible book value per share are used to analyze the relative strength of the Company’s capital position

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The following table summarizes the Company’s return on average tangible assets and return on average tangible stockholders’ equity:

	Three Months Ended
	June 30, 2014			March 31, 2014			December 31, 2013			September 30, 2013			June 30, 2013
	(Dollars in Thousands)
Net income, as reported	$	9,976		$	10,422		$	7,654		$	9,429		$	9,490
Average total assets	$	5,473,450		$	5,361,717		$	5,287,482		5,199,583			5,138,144
Less: Average goodwill and average identified intangible assets, net	153,577			154,447			155,439			156,607			157,799
Average tangible assets	$	5,319,873		$	5,207,270		$	5,132,043		$	5,042,976		$	4,980,345
Return on average tangible assets (annualized)	0.75		%	0.80		%	0.60		%	0.75		%	0.76		%
Average total stockholders’ equity	$	626,371		$	621,764		$	618,385		612,866			616,327
Less: Average goodwill and average identified intangible assets, net	153,577			154,447			155,439			156,607			157,799
Average tangible stockholders’ equity	$	472,794		$	467,317		$	462,946		$	456,259		$	458,528
Return on average tangible stockholders’ equity (annualized)	8.44		%	8.92		%	6.61		%	8.27		%	8.28		%

The following tables summarize the Company’s tangible equity ratio and tangible book value per share at the dates indicated:

	June 30, 2014			March 31, 2014			December 31, 2013			September 30, 2013			June 30, 2013
	(Dollars in Thousands)
Total stockholders’ equity	$	627,663		$	620,799		$	613,867		$	614,811		$	611,284
Less: Goodwill and identified intangible assets, net	153,089			153,916			154,777			155,905			157,058
Tangible stockholders’ equity	$	474,574		$	466,883		$	459,090		$	458,906		$	454,226
Total assets	$	5,587,486		$	5,418,785		$	5,325,106		$	5,236,229		$	5,150,480
Less: Goodwill and identified intangible assets, net	153,089			153,916			154,777			155,905			157,058
Tangible assets	$	5,434,397		$	5,264,869		$	5,170,329		$	5,080,324		$	4,993,422
Tangible equity ratio	8.73		%	8.87		%	8.88		%	9.03		%	9.10		%

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	June 30, 2014		March 31, 2014		December 31, 2013		September 30, 2013		June 30, 2013
	(Dollars In Thousands, Except Share Data)
Tangible stockholders’ equity	$	474,574	$	466,883	$	459,090	$	458,906	$	454,226
Common shares issued	75,744,445		75,744,445		75,744,445		75,744,445		75,744,445
Less: Common shares classified as treasury shares	5,144,807		5,171,985		5,171,985		5,154,327		5,373,733
Less: Unallocated ESOP shares	271,524		281,595		291,666		302,229		312,792
Less: Unvested restricted shares	434,459		408,651		409,068		429,818		276,011
Common shares outstanding	69,893,655		69,882,214		69,871,726		69,858,071		69,781,909
Tangible book value per share	$	6.79	$	6.68	$	6.57	$	6.57	$	6.51

The following table summarizes the Company’s dividend payout ratio:

	Three Months Ended
	June 30, 2014			March 31, 2014			December 31, 2013			September 30, 2013			June 30, 2013
	(Dollars in Thousands)
Dividends paid	$	5,964		$	5,964		$	5,961		$	5,965		$	5,955
Net income, as reported	$	9,976		$	10,422		$	7,654		$	9,429		$	9,490
Dividend payout ratio	59.78		%	57.23		%	77.88		%	63.26		%	62.75		%

The following table summarizes the Company’s allowance for loan and lease losses related to originated loans and leases as a percentage of total originated loans and lease:

	June 30, 2014			March 31, 2014			December 31, 2013			September 30, 2013			June 30, 2013
	(Dollars in Thousands)
Allowance for loan and lease losses	$	51,686		$	50,224		$	48,473		$	46,390		$	44,281
Less: Allowance for acquired loan and lease losses	1,247			1,404			1,629			1,278			620
Allowance for originated loan and lease losses	$	50,439		$	48,820		$	46,844		$	45,112		$	43,661
Total loans and leases	$	4,603,913		$	4,461,997		$	4,362,465		$	4,299,477		$	4,205,015
Less: Total acquired loans and leases	747,106			779,747			815,412			865,708			938,815
Total originated loans and leases	$	3,856,807		$	3,682,250		$	3,547,053		$	3,433,769		$	3,266,200
Allowance for loan and lease losses related to originated loans and leases as a percentage of originated loans and leases	1.31		%	1.33		%	1.32		%	1.31		%	1.34		%

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BROOKLINE BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

At and for the Six Months Ended June 30, 2014 and 2013

Financial Condition

Loans and Leases

The Company continues to focus strategically on growing its commercial loan portfolios. To this end, these portfolios increased from $3.2 billion at December 31, 2013 to $3.4 billion at June 30, 2014, and from 72.6% of total loans and leases to 73.7% of total loans and leases during the same period. Concomitantly, the Company has elected to allow the indirect automobile portfolio to decrease as a percentage of total loans and leases rather than to originate loans at unfavorable interest rates.

The following table summarizes the Company’s portfolio of loans and leases receivable at the dates indicated:

	At June 30, 2014					At December 31, 2013
	Balance			Percent of Total		Balance			Percent of Total
	(Dollars in Thousands)
Commercial real estate loans:
Commercial real estate mortgage	$	1,545,483		33.6	%	$	1,461,985		33.5	%
Multi-family mortgage	631,371			13.7	%	627,933			14.4	%
Construction	137,731			3.0	%	113,705			2.6	%
Total commercial real estate loans	2,314,585			50.3	%	2,203,623			50.5	%
Commercial loans and leases:
Commercial	478,856			10.4	%	407,792			9.3	%
Equipment financing	552,489			12.0	%	513,024			11.8	%
Condominium association	45,608			1.0	%	44,794			1.0	%
Total commercial loans and leases	1,076,953			23.4	%	965,610			22.1	%
Indirect automobile	376,314			8.2	%	400,531			9.2	%
Consumer loans:
Residential mortgage	550,814			11.9	%	528,185			12.1	%
Home equity	270,203			5.9	%	257,461			5.9	%
Other consumer	15,044			0.3	%	7,055			0.2	%
Total consumer loans	836,061			18.1	%	792,701			18.2	%
Total loans and leases	4,603,913			100.0	%	4,362,465			100.0	%
Allowance for loan and lease losses	(51,686		)			(48,473		)
Net loans and leases	$	4,552,227				$	4,313,992

The following table sets forth the growth (decline) in the Company’s loan and lease portfolios during the six months endedJune 30, 2014:

	At June 30, 2014		At December 31, 2013		Dollar Change			Percent Change (Annualized)
	(Dollars in Thousands)
Commercial real estate	$	2,314,585	$	2,203,623	$	110,962		10.1	%
Commercial	1,076,953		965,610		111,343			23.1	%
Indirect automobile	376,314		400,531		(24,217		)	-12.1	%
Consumer	836,061		792,701		43,360			10.9	%
Total loans and leases	$	4,603,913	$	4,362,465	$	241,448		11.1	%

The Company’s loan portfolio consists primarily of first mortgage loans secured by commercial, multi-family and residential real estate properties located in the Company’s primary lending area, indirect automobile loans, loans to business entities, including commercial lines of credit, loans to condominium associations and loans and leases used to finance

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equipment used by small businesses. The Company also provides financing for construction and development projects, home equity and other consumer loans.

The Company employs seasoned commercial lenders and retail bankers who rely on community and business contacts as well as referrals from customers, attorneys and other professionals to generate loans and deposits. Existing borrowers are also an important source of business since many of them have more than one loan outstanding with the Company. The Company’s ability to originate loans depends on the strength of the economy, trends in interest rates, and levels of customer demand and market competition.

Commercial Real Estate Loans

The commercial real estate portfolio of $2.3 billion at June 30, 2014 is composed of commercial real estate mortgage loans, multi-family mortgage loans, and construction loans and is the largest component of the Company’s overall loan portfolio, representing 50.3% of total loans and leases outstanding at June 30, 2014. For the commercial real estate portfolio, the Company focuses on making loans in the $3 million to $10 million range.

Typically, commercial real estate loans are larger in size and involve a greater degree of risk than owner-occupied residential mortgage loans. Loan repayment is usually dependent on the successful operation and management of the properties and the value of the properties securing the loans. Economic conditions can greatly affect cash flows and property values.

A number of factors are considered in originating commercial real estate and multi-family mortgage loans. The qualifications and financial condition of the borrower (including credit history), as well as the potential income generation and the value and condition of the underlying property, are evaluated. When evaluating the qualifications of the borrower, the Company considers the financial resources of the borrower, the borrower’s experience in owning or managing similar property and the borrower’s payment history with the Company and other financial institutions. Factors considered in evaluating the underlying property include the net operating income of the mortgaged premises before debt service and depreciation, the debt service coverage ratio (the ratio of cash flow before debt service to debt service), the use of conservative capitalization rates, and the ratio of the loan amount to the appraised value. Generally, personal guarantees are obtained from commercial real estate loan borrowers.

Commercial real estate and multi-family mortgage loans are typically originated for terms of five years with amortization periods of 20 to 30 years. Many of the loans are priced at inception on a fixed-rate basis generally for periods ranging from two to five years with repricing periods for longer-term loans. When possible, prepayment penalties are included in loan covenants on these loans.

The Company's urban and suburban market area is characterized by a large number of apartment buildings, condominiums and office buildings. As a result, multi-family and commercial real estate mortgage lending has been a significant part of the Company's activities for many years. These types of loans typically generate higher yields, but also involve greater credit risk. Many of the Company's borrowers have more than one multi-family or commercial real estate loan outstanding with the Company.

Over 98% of the commercial real estate loans outstanding at June 30, 2014 were secured by properties located in New England. The commercial real estate portfolio at that date was composed primarily of loans secured by apartment buildings ($637.7 million), office buildings ($524.1 million), retail stores ($462.2 million), industrial properties ($268.1 million) and mixed-use properties ($174.6 million).

Construction and development financing is generally considered to involve a higher degree of risk than long-term financing on improved, occupied real estate and thus has higher concentration limits than do other commercial credit classes. Risk of loss on a construction loan is largely dependent upon the accuracy of the initial estimate of construction costs, the estimated time to sell or rent the completed property at an adequate price or rate of occupancy, and market conditions. If the estimates and projections prove to be inaccurate, the Company may be confronted with a project which, upon completion, has a value that is insufficient to assure full loan repayment.

Criteria applied in underwriting construction loans for which the primary source of repayment is the sale of the property are different from the criteria applied in underwriting construction loans for which the primary source of repayment is the stabilized cash flow from the completed project. For those loans where the primary source of repayment is from resale of the property, in addition to the normal credit analysis performed for other loans, the Company also analyzes project costs, the attractiveness of the property in relation to the market in which it is located and demand within the market area. For those construction loans where the source of repayment is the stabilized cash flow from the completed project, the Company analyzes

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not only project costs but also how long it might take to achieve satisfactory occupancy and the reasonableness of projected rental rates in relation to market rental rates.

Commercial Loans and Leases

The commercial loan and lease portfolio of $1.1 billion at June 30, 2014 is composed of commercial loans, equipment financing loans and leases and condominium association loans and represented 23.4% of total loans outstanding at June 30, 2014. The Company focuses on making commercial loans in the $1 million to $10 million range.

The Company provides commercial banking services to companies in its market area. Over 52% of the commercial loans outstanding at June 30, 2014 were made to borrowers located in New England. Product offerings include lines of credit, term loans, letters of credit, deposit services and cash management. These types of credit facilities have as their primary source of repayment cash flows from the operations of a business. Interest rates offered are available on a floating basis tied to the prime rate or a similar index or on a fixed-rate basis referenced on the Federal Home Loan Bank of Boston (“FHLBB”) index.

Credit extensions are made to established businesses on the basis of loan purpose and assessment of capacity to repay as determined by an analysis of their financial statements, the nature of collateral to secure the credit extension and, in most instances, the personal guarantee of the owner of the business as well as industry and general economic conditions. The Company also participates in U.S. Government programs such as the Small Business Administration (the “SBA”) in both the 7A program and as an SBA preferred lender.

The Company’s equipment financing divisions focus on market niches in which its lenders have deep experience and industry contacts, and on making loans to customers with business experience. An important part of the Company’s equipment financing loan origination volume comes from equipment manufacturers and existing customers as they expand their operations. The equipment financing portfolio is composed primarily of loans to finance coin-operated laundry, dry cleaning, fitness, and convenience store equipment and most recently, tow trucks. The borrowers are located primarily in the greater New York/New Jersey metropolitan area, although the customer base extends to locations throughout the United States. Typically, the loans are priced at a fixed rate of interest and require monthly payments over their three- to ten-year life. The yields earned on equipment financing loans are higher than those earned on the commercial loans made by the Banks because they involve a higher degree of credit risk. Equipment financing customers are typically small-business owners who operate with limited financial resources and who face greater risks when the economy weakens or unforeseen adverse events arise. Because of these characteristics, personal guarantees of borrowers are usually obtained along with liens on available assets. The Company focuses on making equipment financing loans and leases in the $100,000 to $500,000 range. The size of loan is determined by an analysis of cash flow and other characteristics pertaining to the business and the equipment to be financed, based on detailed revenue and profitability data of similar operations.

Loans to condominium associations are for the purpose of funding capital improvements, are made for five- to ten-year terms and are secured by a general assignment of condominium association revenues. Among the factors considered in the underwriting of such loans are the level of owner occupancy, the financial condition and history of the condominium association, the attractiveness of the property in relation to the market in which it is located and the reasonableness of estimates of the cost of capital improvements to be made. Depending on loan size, funds are advanced as capital improvements are made and, in more complex situations, after completion of engineering inspections.

Indirect Automobile Loans

The indirect automobile loan portfolio of $376.3 million at June 30, 2014 represented 8.2% of total loans outstanding at June 30, 2014. Indirect automobile loans are down from $400.5 million at December 31, 2013. Although automobile sales continue to be robust through the first six months of 2014, competition for these loans increased significantly as credit unions and large national banks entered indirect automobile lending in a search for additional sources of income. That competition drove interest rates down and, in some cases, changed the manner in which interest rates are developed, from including a dealer-shared spread to imposing a dealer-based fee to originate the loan. Depending on the terms of the dealer's enrollment agreement with the Company, the dealer earns this fee 90 days after a loan is originated or once the borrower makes at least three payments on the loan.

Indirect automobile loans are for the purchase of automobiles (both new and used) and light-duty trucks primarily by individuals, but also by corporations and other organizations. The loans are originated through over 200 dealerships located primarily in Massachusetts, but also in Connecticut, Rhode Island and New Hampshire. Dealer relationships are reviewed periodically for application quality, the ratio of loans approved to applications submitted and loan performance.

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Loan applications are generated by approved dealers and data are entered into an application processing system. A credit bureau scorecard model is used in the underwriting process. The model is based on data accumulated by nationally recognized credit bureaus and is a risk assessment tool that analyzes an individual’s credit history and assigns a numeric credit score. The model meets the requirements of the Equal Credit Opportunity Act. The application processing system sorts each application according to score ranges. Loans must meet criteria established in the Company’s loan policy. Credit profile measurements such as debt-to-income ratios, payment-to-income ratios and loan-to-value ratios are utilized in the underwriting process and to monitor the performance of loans falling within specified ratio ranges. Regarding loan-to-value ratios, the Company considers indirect automobile loans to be essentially credits that are less than fully collateralized. When borrowers cease to make required payments, repossession and sale of the vehicle financed usually results in insufficient funds to fully pay the remaining loan balance.

The Company’s indirect automobile loan policy limits origination of loans with credit scores of 660 or below to 5% of monthly indirect loan originations. At June 30, 2014, loans with credit scores of 660 or below were 2.9% of loans outstanding. The average-dollar original weighted credit score of loans in the portfolio at that date was 749. All loans require the purchase of single interest insurance by the borrower. The insurance is designed to protect the Company from loss when a loan is in default and the collateral value is impaired due to vehicle damage or the Company is unable to take possession of the vehicle.

Indirect automobile loans are assigned a particular tier based on the credit score determined by the credit bureau. The tier is used for pricing purposes only so as to assure consistency in loan pricing. Tier rates can be modified if certain conditions exist as outlined in the Company’s loan policy. The rate paid by a borrower usually differs with the “buy rate” earned by the Company. The difference is commonly referred to as the “spread.” All of the spread is paid after the end of the month in which the loan is made and is comprised of the agreed-upon rate differential multiplied by the expected average balance of the loan over its scheduled maturity. If a loan is repaid in its entirety within 90 days or before three payments have been made (depending on the agreement with the dealer), the dealer must pay the remainder of unamortized spread to the Company. If a loan is repaid after 90 days or after three payments have been made (depending on the agreement with the dealer), the dealer is not obliged to repay any part of the spread amount previously received. Spread payments to dealers are amortized as a reduction of interest received from borrowers over the life of the related loans. When loans are prepaid, any remaining unamortized balance is charged to expense at that time.

Various reports are generated to monitor receipt of required loan documents, adherence to loan policy parameters, dealer performance, loan delinquencies and loan charge-offs. Summary reports are submitted to the Chief Credit Officer, the Chief Financial Officer and the Board of Directors on a periodic basis.

Consumer Loans

The consumer loan portfolio of $836.1 million at June 30, 2014 is composed of residential mortgage loans, home equity loans and lines of credit and other consumer loans and represented 18.1% of total loans outstanding at June 30, 2014. The Company focuses its mortgage loans on existing and new customers within its branch networks in its urban and suburban marketplaces in the greater Boston and Providence metropolitan areas.

The Company originates adjustable- and fixed-rate residential mortgage loans secured by one- to four-family residences. Each residential mortgage loan granted is subject to a satisfactorily completed application, employment verification, credit history and a demonstrated ability to repay the debt. Generally, loans are not made when the loan-to-value ratio exceeds 80% unless private mortgage insurance is obtained and/or there is a financially strong guarantor. Appraisals are performed by outside independent fee appraisers.

In general, the Company maintains three-, five- and seven-year adjustable-rate mortgage loans and ten-year fixed-rate fully amortizing mortgage loans in its portfolio. Fixed-rate mortgage loans with maturities beyond ten years, such as 15- and 30-year fixed-rate mortgages, are not generally maintained in the Company’s portfolio but are, rather, sold into the secondary market on a servicing-released basis. At June 30, 2014, the Banks acted as correspondent banks in these secondary-market transactions. Loan sales in the secondary market provide funds for additional lending and other banking activities.

Underwriting guidelines for home equity loans and lines of credit are similar to those for residential mortgage loans. Home equity loans and lines of credit are limited to no more than 80% of the appraised value of the property securing the loan including the amount of any existing first mortgage liens.

Other consumer loans have historically been a modest part of the Company’s loan originations. At June 30, 2014, originated other consumer loans equaled $14.3 million or 0.4% of total originated loans outstanding at that date. Equity and debt securities were pledged as collateral for a substantial part of the total of those loans.

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Asset Quality

Criticized and Classified Assets

The Company’s management negatively rates certain loans and leases as “other asset especially mentioned ("OAEM"),” “substandard” or “doubtful” based on criteria established under banking regulations. These loans and leases are collectively referred to as “criticized” assets. Loans and leases rated OAEM have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects of the loan or lease at some future date. Loans and leases rated as substandard are inadequately protected by the payment capacity of the obligor or of the collateral pledged, if any. Substandard loans and leases have a well-defined weakness or weaknesses that jeopardize the liquidation of debt and are characterized by the distinct possibility that the Company will sustain some loss if existing deficiencies are not corrected. At June 30, 2014, the Company had $58.8 million of total assets, including acquired assets, that were designated as criticized. This compares to $57.5 million of assets that were designated as criticized at December 31, 2013. See Note 5, “Allowance for Loan and Lease Losses,” to the unaudited consolidated financial statements for more information on the Company’s risk-rating system.

Nonperforming Assets

“Nonperforming assets” consist of nonperforming loans and leases, other real estate owned (“OREO”) and other repossessed assets. Under certain circumstances, the Company may restructure the terms of a loan or lease as a concession to a borrower, except for acquired loans and leases which are individually evaluated against expected performance on the date of acquisition. These restructured loans and leases are generally considered “nonperforming loans and leases” until a history of collection of at least six months on the restructured terms of the loan or lease has been established. OREO consists of real estate acquired through foreclosure proceedings and real estate acquired through acceptance of a deed in lieu of foreclosure. Other repossessed assets consist of assets that have been acquired through foreclosure that are not real estate and are included in other assets on the Company’s unaudited consolidated balance sheets.

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The following table sets forth information regarding nonperforming assets at the dates indicated:

	At June 30, 2014			At December 31, 2013
	(Dollars in Thousands)
Nonaccrual loans and leases:
Commercial real estate mortgage	$	3,011		$	1,098
Commercial	6,383			6,148
Equipment financing	3,251			4,115
Condominium association	—			1
Indirect automobile	325			259
Residential mortgage	2,384			2,875
Home equity	1,771			1,987
Other consumer	36			18
Total nonaccrual loans and leases	17,161			16,501
Other real estate owned	675			577
Other repossessed assets	571			1,001
Total nonperforming assets	$	18,407		$	18,079
Loans and leases past due greater than 90 days and still accruing	$	6,653		$	10,913
Total nonperforming loans and leases as a percentage of total loans and leases	0.37		%	0.38		%
Total nonperforming assets as a percentage of total assets	0.33		%	0.34		%
Total delinquent loans and leases greater than 90 days past due as a percentage of total loans and leases	0.31		%	0.41		%

Total nonperforming assets, which are composed of nonaccrual loans and leases, other real estate owned and other repossessed assets, increased from $18.1 million at December 31, 2013 to $18.4 million at June 30, 2014.  From December 31, 2013 to June 30, 2014, nonaccrual loans and leases increased $1.9 million (174.2%) in commercial real estate mortgage, $0.2 million (3.8%) in commercial and $0.1 million (25.5%) in indirect automobile. The increases in nonaccrual loans were offset by a decrease of $0.9 million (21.0%) in equipment financing, $0.5 million (17.1%) in residential mortgage and $0.2 million(10.9%) in home equity nonaccrual loans.

Troubled Debt Restructured Loans and Leases

The following table sets forth information regarding troubled debt restructured loans and leases at the dates indicated:

	At June 30, 2014		At December 31, 2013
	(Dollars in Thousands)
Troubled debt restructurings:
On accrual	$	12,396	$	12,759
On nonaccrual	5,992		5,589
Total troubled debt restructurings	$	18,388	$	18,348

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Changes in troubled debt restructured loans and leases were as follows for the periods indicated:

	Three months ended June 30,						Six months ended June 30,
	2014			2013			2014			2013
	(Dollars in Thousands)
Balance at beginning of period	$	18,296		$	17,330		$	18,348		$	17,200
Additions	1,206			919			2,086			2,813
Charge-offs	(50		)	(245		)	(50		)	(245		)
Repayments	(1,064		)	(1,454		)	(1,801		)	(1,469		)
Other reductions (1)	—			—			(195		)	(1,749		)
Balance at end of period	$	18,388		$	16,550		$	18,388		$	16,550

⁽¹⁾ Other reductions include transfers to OREO and change in TDR status.

Allowance for Loan and Lease Losses

The allowance for loan and lease losses consists of general, specific and unallocated allowances and reflects management’s estimate of probable loan and lease losses inherent in the loan portfolio at the balance sheet date. Management uses a consistent and systematic process and methodology to evaluate the adequacy of the allowance for loan and lease losses on a quarterly basis. The allowance is calculated by loan type: commercial real estate loans, commercial loans and leases, indirect automobile loans and consumer loans, each category of which is further segregated. A formula-based credit evaluation approach is applied to each group that is evaluated collectively, primarily by loss factors assigned to each risk rating by type coupled with an analysis of certain loans individually evaluated for impairment. Management continuously evaluates and challenges inputs and assumptions in the allowance for loan and lease loss. During the three and six months endedJune 30, 2014, management reviewed these conditions and adjusted the factors due to the absence of losses outside the normal course of business and improved credit quality.

The process to determine the allowance for loan and lease losses requires management to exercise considerable judgment regarding the risk characteristics of the loan portfolios and the effect of relevant internal and external factors. While management evaluates currently available information in establishing the allowance for loan and lease losses, future adjustments to the allowance for loan and lease losses may be necessary if conditions differ substantially from the assumptions used in making the evaluations. Management performs a comprehensive review of the allowance for loan and lease losses on a quarterly basis. In addition, various regulatory agencies, as an integral part of their examination process, periodically review a financial institution’s allowance for loan and lease losses and carrying amounts of other real estate owned. Such agencies may require the financial institution to recognize additions to the allowance based on their judgments about information available to them at the time of their examination. See Note 5, “Allowance for Loan and Lease Losses,” to the unaudited consolidated financial statements for descriptions of how management determines the balance of the allowance for loan and lease losses for each portfolio and class of loans.

The following tables present the changes in the allowance for loan and lease losses by portfolio segment for the three months and six months endedJune 30, 2014 and 2013.

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	At and for the Three Months Ended June 30, 2014
	Commercial  Real Estate			Commercial			Indirect  Automobile			Consumer			Unallocated			Total
	(Dollars in Thousands)
Balance at March 31, 2014	$	24,858		$	15,544		$	3,664		$	3,110		$	3,048		$	50,224
Charge-offs	—			(796		)	(228		)	(172		)	—			(1,196		)
Recoveries	—			218			173			85			—			476
Provision (credit) for loan and lease losses	1,857			900			77			(6		)	(646		)	2,182
Balance at June 30, 2014	$	26,715		$	15,866		$	3,686		$	3,017		$	2,402		$	51,686
Total loans and leases	$	2,314,585		$	1,076,953		$	376,314		$	836,061		N/A			$	4,603,913
Allowance for loan and lease losses as a percentage of total loans and leases	1.15		%	1.47		%	0.98		%	0.36		%	N/A			1.12		%

	At and for the Three Months Ended June 30, 2013
	Commercial Real Estate			Commercial			Indirect  Automobile			Consumer			Unallocated		Total
	(Dollars in Thousands)
Balance at March 31, 2013	$	20,588		$	11,652		$	5,000		$	2,596		$	2,696	$	42,532
Charge-offs	(81		)	(477		)	(318		)	(154		)	—		(1,030		)
Recoveries	—			182			149			60			—		391
Provision (credit) for loan and lease losses	1,512			434			(136		)	497			81		2,388
Balance at June 30, 2013	$	22,019		$	11,791		$	4,695		$	2,999		$	2,777	$	44,281
Total loans and leases	$	2,056,674		$	895,090		$	479,782		$	773,469		N/A		$	4,205,015
Allowance for loan and lease losses as a percentage of total loans and leases	1.07		%	1.32		%	0.98		%	0.39		%	N/A		1.05		%

	At and for the Six Months Ended June 30, 2014
	Commercial  Real Estate			Commercial			Indirect  Automobile			Consumer			Unallocated			Total
	(Dollars in Thousands)
Balance at December 31, 2013	$	23,022		$	15,220		$	3,924		$	3,375		$	2,932		$	48,473
Charge-offs	—			(1,347		)	(517		)	(382		)	—			(2,246		)
Recoveries	—			469			277			114			—			860
Provision (credit) for loan and lease losses	3,693			1,524			2			(90		)	(530		)	4,599
Balance at June 30, 2014	$	26,715		$	15,866		$	3,686		$	3,017		$	2,402		$	51,686
Total loans and leases	$	2,314,585		$	1,076,953		$	376,314		$	836,061		N/A			$	4,603,913
Allowance for loan and lease losses as a percentage of total loans and leases	1.15		%	1.47		%	0.98		%	0.36		%	N/A			1.12		%

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	At and for the Six Months Ended June 30, 2013
	Commercial  Real Estate			Commercial			Indirect  Automobile			Consumer			Unallocated		Total
	(Dollars in Thousands)
Balance at December 31, 2012	$	20,018		$	10,655		$	5,304		$	2,545		$	2,630	$	41,152
Charge-offs	(81		)	(724		)	(680		)	(206		)	—		(1,691		)
Recoveries	4			264			279			86			—		633
Provision (credit) for loan and lease losses	2,078			1,596			(208		)	574			147		4,187
Balance at June 30, 2013	$	22,019		$	11,791		$	4,695		$	2,999		$	2,777	$	44,281
Total loans and leases	$	2,056,674		$	895,090		$	479,782		$	773,469		N/A		$	4,205,015
Allowance for loan and lease losses as a percentage of total loans and leases	1.07		%	1.32		%	0.98		%	0.39		%	N/A		1.05		%

The allowance for loan and lease losses was $51.7 million at June 30, 2014 or 1.12% of total loans and leases outstanding. This compared to an allowance for loan and lease losses of $48.5 million or 1.11% of total loans and leases outstanding at December 31, 2013. The increase in the allowance for loan and lease losses and in the allowance for loan and lease losses as a percentage of total loans and leases from December 31, 2013 to June 30, 2014 is due to loan growth of $241.4 million during the first six months of 2014. The allowance for loan and lease losses related to originated loans and leases represents 1.31% and 1.32% of originated loans and leases at June 30, 2014 and December 31, 2013, respectively.

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Commercial Real Estate Loans

The allowance for commercial real estate loan losses was $26.7 million at June 30, 2014 or 1.15% of total commercial real estate loans outstanding. This compared to an allowance for commercial real estate loan losses of $23.0 million or 1.04% of total commercial real estate loans outstanding at December 31, 2013. Specific reserves on commercial real estate loans decreased from $0.3 million to $0.1 million from December 31, 2013 to June 30, 2014. Excluding balances in acquired loan portfolios, the allowance for commercial real estate loan losses as a percentage of total commercial real estate loans outstanding increased to 1.13% at June 30, 2014 from 1.02% at December 31, 2013.

The $3.7 million increase in the allowance for commercial real estate loan losses during the first six months of 2014 was primarily driven by originated loan growth of $148.6 million, or 16.8% on an annualized basis, from December 31, 2013. The ratio of total criticized and classified commercial real estate loans to total commercial real estate loans decreased to 1.34% at June 30, 2014 from 1.63% at December 31, 2013. The ratio of originated commercial real estate loans on nonaccrual to total originated commercial real estate loans increased to 0.05% at June 30, 2014 from 0.01% at December 31, 2013.

As a percentage of average commercial real estate loans, annualized net charge-offs for the three-month and six-month periods ended June 30, 2014 and June 30, 2013 were negligible.

Commercial Loans and Leases

The allowance for commercial loan and lease losses was $15.9 million or 1.47% of total commercial loans and leases outstanding at June 30, 2014, as compared to $15.2 million or 1.58% at December 31, 2013.  Specific reserves on commercial loans and leases increased from $0.8 million at December 31, 2013 to $1.0 million at June 30, 2014. Excluding balances in acquired loan portfolios, the allowance for commercial loan and lease losses as a percentage of total commercial loans and leases outstanding decreased to 1.43% at June 30, 2014 from 1.53% at December 31, 2013.

The $0.7 million increase in the allowance for commercial loan and lease losses during the first six months of 2014 was primarily driven by originated loan growth of $122.9 million, or 29.7% on an annualized basis, from December 31, 2013 and the addition of $0.1 million in allowances for post-acquisition deterioration in certain commercial loan and lease portfolios. The ratio of total criticized and classified commercial loans and leases to total commercial loans and leases was 2.58% at June 30, 2014 as compared to 2.24% at December 31, 2013. The ratio of originated commercial loans and leases on nonaccrual to total originated commercial loans and leases decreased to 0.48% at June 30, 2014 from 0.68% at December 31, 2013.

Net charge-offs in the commercial loan and lease portfolio for the three-month periods ended June 30, 2014 and June 30, 2013 were $0.6 million and $0.3 million, respectively. As a percentage of average commercial loans and leases, annualized net charge-offs for the three-month periods ended June 30, 2014 and June 30, 2013 were 0.22% and 0.13%, respectively.

Net charge-offs in the commercial loan and lease portfolio for the six months endedJune 30, 2014 and June 30, 2013 were $0.9 million and $0.5 million, respectively. As a percentage of average commercial loans and leases, annualized net charge-offs for the three-month periods ended June 30, 2014 and June 30, 2013 were 0.17% and 0.11%, respectively.

Indirect Automobile Loans

The allowance for indirect automobile loan losses was $3.7 million or 0.98% of total indirect automobile loans outstanding at June 30, 2014, compared to $3.9 million or 0.98% of the indirect automobile portfolio outstanding at December 31, 2013.  There were no loans individually evaluated for impairment in the indirect automobile portfolio at June 30, 2014. The $0.2 million decrease in the allowance for indirect automobile loan losses was primarily a result of declines in loans outstanding, which decreased $24.2 million from $400.5 million at December 31, 2013 to $376.3 million at June 30, 2014.

The ratio of indirect automobile loans with borrower credit scores below 660 to the total indirect automobile portfolio decreased slightly to 2.9% at June 30, 2014 from 3.2% at December 31, 2013. The ratio of indirect automobile loans on nonaccrual to total indirect automobile loans increased slightly to 0.09% at June 30, 2014 compared to 0.06% at December 31, 2013.

Net charge-offs in the indirect automobile portfolio for the three-month periods ended June 30, 2014 and 2013 was $0.1 million and $0.2 million, respectively. As a percentage of average loans and leases, annualized net charge-offs for the three-month periods ended June 30, 2014 and June 30, 2013 were 0.06% and 0.14% respectively, reflecting the favorable trend in credit quality as the portfolio has been allowed to run down.

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 Net charge-offs in the indirect automobile portfolio for the six months endedJune 30, 2014 and 2013 was $0.2 million and $0.4 million, respectively. As a percentage of average loans and leases, annualized net charge-offs for the six-month periods ended June 30, 2014 and June 30, 2013 were 0.13% and 0.16% respectively, reflecting the favorable trend in credit quality as the portfolio has been allowed to run down.

Consumer Loans

The allowance for consumer loan losses, including residential loans and home equity loans and lines of credit, was $3.0 million or 0.36% of total consumer loans and leases outstanding at June 30, 2014 as compared to $3.4 million or 0.43% at December 31, 2013. There was zero reserve for loans individually evaluated for impairment at June 30, 2014 on loan balances of $6.0 million, compared to $0.3 million on loan balances of $4.3 million at December 31, 2013. Excluding balances in acquired loan portfolios, the allowance for consumer losses as a percentage of total consumer loans outstanding was 0.33% at June 30, 2014, compared to 0.35% at December 31, 2013.

The $0.4 million decrease in the allowance for consumer loans during the first six months of 2014 was primarily driven by the decrease in allowance on loans individually evaluated for impairment due to better than expected performance and cash flows. The ratio of residential and home equity loans with loan-to-value ratios greater than 80% increased to 6.53% of total residential and home equity loans at June 30, 2014 from 4.78% at December 31, 2013. The ratio of originated consumer loans on nonaccrual to total originated consumer loans decreased to 0.30% at June 30, 2014 from 0.40% at December 31, 2013.  The risk of loss on a home equity loan is higher since the property securing the loan has often been previously pledged as collateral for a first mortgage loan. The Company gathers and analyzes delinquency data, to the extent that data are available on these first liens, for purposes of assessing the collectability of the second liens held for the Company even if these home equity loans are not delinquent. This data are further analyzed for performance differences between amortizing and non-amortizing home equity loans, the percentage borrowed to total loan commitment and by the amount of payments made by the borrowers. The exposure to loss is not considered to be high due to the combination of current property values, the low level of losses experienced in the past few years and the low level of loan delinquencies at June 30, 2014. If the local economy weakens, however, a rise in losses in those loan classes could occur. Historically, losses in these classes have been low.

Net charge-offs in the consumer portfolio for the three-month periods ended June 30, 2014 and June 30, 2013 were less than $0.1 million in both periods. As a percentage of average consumer loans and leases, annualized net charge-offs for the three-month periods ended June 30, 2014 and June 30, 2013 were 0.04% and 0.05%, respectively.

Net charge-offs in the consumer portfolio for the three-month periods ended June 30, 2014 and June 30, 2013 was $0.3 million and $0.1 million, respectively. As a percentage of average consumer loans and leases, annualized net charge-offs for the three-month periods ended June 30, 2014 and June 30, 2013 were 0.07% and 0.03%, respectively.

Unallocated Allowance

The unallocated allowance recognizes the estimation risk associated with the allocated general and specific allowances, incorporates management’s evaluation of existing conditions that are not included in the allocated allowance determinations and protects against potential losses outside of the ordinary course of business. These conditions are reviewed quarterly by management. Causes of losses outside the normal course of business include, but are not limited to, fraudulently obtained loans where there is no primary or secondary source of repayment; catastrophic and uninsured property loss where collateral is destroyed with no compensation; and legal documentation flaws that compromise security interests in collateral assets or the availability of guarantors. Management reviewed these conditions and adjusted the factors due to the absence of losses outside the normal course of business and improved credit quality. The unallocated allowance for loan and lease losses was $2.4 million at June 30, 2014, compared to $2.9 million at December 31, 2013.

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The following table sets forth the Company’s percent of allowance for loan and lease losses to the total allowance for loan and lease losses and the percent of loans to total loans for each of the categories listed at the dates indicated.

	At June 30, 2014						At December 31, 2013
	Amount		Percent of  Allowance to  Total Allowance		Percentof  Loans to  Total Loans		Amount		Percent of  Allowance to  Total Allowance		Percentof  Loans to  Total Loans
	(Dollars in Thousands)
Commercial real estate loans:
Commercial real estate mortgage	$	17,976	34.8	%	33.6	%	$	14,883	30.7	%	33.5	%
Multi-family	4,826		9.3	%	13.7	%	4,890		10.1	%	14.4	%
Construction	3,913		7.6	%	3.0	%	3,249		6.7	%	2.6	%
Total commercial real estate loans	26,715		51.7	%	50.3	%	23,022		47.5	%	50.5	%
Commercial loans and leases:
Commercial	7,335		14.2	%	10.4	%	6,724		13.9	%	9.3	%
Equipment financing	8,200		15.9	%	12.0	%	8,161		16.8	%	11.8	%
Condominium association	331		0.6	%	1.0	%	335		0.7	%	1.0	%
Total commercial loans and leases	15,866		30.7	%	23.4	%	15,220		31.4	%	22.1	%
Indirect automobile	3,686		7.1	%	8.2	%	3,924		8.1	%	9.2	%
Consumer loans:
Residential mortgage	1,330		2.6	%	11.9	%	1,431		3.0	%	12.1	%
Home equity	1,541		3.0	%	5.9	%	1,324		2.7	%	5.9	%
Other consumer	146		0.3	%	0.3	%	620		1.3	%	0.2	%
Total consumer loans	3,017		5.9	%	18.1	%	3,375		7.0	%	18.2	%
Unallocated	2,402		4.6	%	0.0	%	2,932		6.0	%	0.0	%
Total	$	51,686	100.0	%	100.0	%	$	48,473	100.0	%	100.0	%

Investments

The investment portfolio exists primarily for liquidity purposes, and secondarily as sources of interest and dividend income, interest-rate risk management and tax planning as a counterbalance to loan and deposit flows. Investment securities available-for-sale are utilized as part of the Company’s asset/liability management and may be sold in response to, or in anticipation of, factors such as changes in market conditions and interest rates, security prepayment rates, deposit outflows, liquidity concentrations and regulatory capital requirements.

The investment policy of the Company, which is reviewed and approved by the Board of Directors on an annual basis, specifies the types of investments that are acceptable, required investment ratings by at least one nationally recognized rating agency, concentration limits and duration guidelines. Compliance with the investment policy is monitored on a regular basis. In general, the Company seeks to maintain a high degree of liquidity and targets cash, cash equivalents and investment securities available-for-sale balances between 10% and 30% of total assets.

Cash, cash equivalents, and investment securities increased$23.4 million, or 8.0% on an annualized basis, to $608.8 million at June 30, 2014 from $585.4 million at December 31, 2013. Cash, cash equivalents, and investment securities were 10.9% of total assets at June 30, 2014, compared to 11.0% of total assets at December 31, 2013.

The following table sets forth certain information regarding the amortized cost and market value of the Company’s investment securities at the dates indicated:

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	At June 30, 2014				At December 31, 2013
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In Thousands)
Investment securities available-for-sale:
Debt securities:
GSEs	$	15,968	$	15,978	$	12,138	$	12,180
GSE CMOs	254,863		247,547		254,331		243,644
GSE MBSs	220,848		221,847		202,478		199,401
Private-label CMOs	—		—		3,258		3,355
SBA commercial loan asset-backed securities	227		226		245		243
Auction-rate municipal obligations	—		—		1,900		1,775
Municipal obligations	—		—		1,068		1,086
Corporate debt obligations	39,759		40,330		27,751		28,224
Trust preferred securities	1,462		1,299		1,461		1,210
Total debt securities	533,127		527,227		504,630		491,118
Marketable equity securities	1,264		1,359		1,259		1,310
Total investment securities available-for-sale	$	534,391	$	528,586	$	505,889	$	492,428
Investment securities held-to-maturity	$	500	$	500	$	500	$	500

The fair value of investment securities is based principally on market prices and dealer quotes received from third-party, nationally-recognized pricing services for identical investment securities such as U.S. Treasury and agency securities. The Company's marketable equity securities are priced this way and are included in Level 1. These prices are validated by comparing the primary pricing source with an alternative pricing source when available. When quoted market prices for identical securities are unavailable, the Company uses market prices provided by independent pricing services based on recent trading activity and other observable information, including but not limited to market interest-rate curves, referenced credit spreads and estimated prepayment speeds where applicable. These investments include certain U.S. and government agency debt securities, municipal and corporate debt securities, GSE residential MBSs and CMOs, and trust preferred securities, all of which are included in Level 2. Certain fair values are estimated using pricing models (such as auction-rate municipal securities) and are included in Level 3.

Additionally, management reviews changes in fair value from period to period and performs testing to ensure that prices received from the third parties are consistent with their expectation of the market. Changes in the prices obtained from the pricing service are analyzed from month to month, taking into consideration changes in market conditions including changes in mortgage spreads, changes in U.S. Treasury security yields and changes in generic pricing of 15-year  and 30-year securities. Additional analysis may include a review of prices provided by other independent parties, a yield analysis, a review of average life changes using Bloomberg analytics and a review of historical pricing for the particular security.

During the second quarter of 2014, in an effort to achieve better capital allocation, the Company liquidated all private-label CMOs, auction-rate municipal obligations and municipal obligations, all of which are 100% risk weighted. Proceeds from the investment securities sales were used to reinvest in GSE securities, which are risk weighted at 20%.

Maturities, calls and principal repayments totaled $34.6 million for the six months endedJune 30, 2014 compared to $69.8 million for the same period in 2013. During the six months endedJune 30, 2014, the Company purchased $69.1 million of available-for-sale securities and $0.5 million of held-to-maturity securities compared to $82.3 million of available-for-sale securities and no held-to-maturity securities for the same period in 2013. During the six months endedJune 30, 2014, the Company sold $5.1 million of available-for-sale securities. During the six months endedJune 30, 2013, the Company did not sell any available-for-sale or held-to-maturity securities.

At June 30, 2014, the fair value of all investment securities available-for-sale was $528.6 million, with net unrealized losses of $5.8 million, compared to a fair value of $492.4 million and net unrealized losses of $13.5 million at December 31, 2013. At June 30, 2014, $344.5 million, or 65.2%, of the portfolio, had gross unrealized losses of $9.2 million. This compares to $383.3 million, or 77.8% of the portfolio with gross unrealized losses of $16.1 million at December 31, 2013. The decrease

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in unrealized losses over the first six months of 2014 was driven by decreases in interest rates. Management believes that these negative differences between amortized cost and fair value do not include credit losses, but rather differences in interest rates between the time of purchase and the time of measurement. It is more likely than not that the Company will not sell the securities before recovery, and, as a result, it will recover the amortized cost basis of the securities. As such, management has determined that the securities are not other-than-temporarily impaired at June 30, 2014. If market conditions for securities worsen or the creditworthiness of the underlying issuers deteriorates, it is possible that the Company may recognize additional other-than-temporary impairments in future periods. For additional discussion on how the Company validates fair values provided by the third-party pricing service, see Note 12, “Fair Value of Financial Instruments.”

Restricted Equity Securities

Federal Reserve Bank Stock

The Company invests in the stock of the Federal Reserve Bank of Boston, as required by the Banks’ membership in the FRB. At June 30, 2014 and December 31, 2013, the Company owned stock in the Federal Reserve Bank of Boston with a carrying value of $16.0 million.

FHLBB Stock

The Company invests in the stock of the FHLBB as one of the requirements to borrow. At June 30, 2014, the Company maintains an excess balance of capital stock of $4.5 million compared to $12.0 million at December 31, 2013, which allows for additional borrowing capacity at each Bank. At June 30, 2014, the Company owned stock in the FHLBB with a carrying value of $55.0 million compared to $50.1 million at December 31, 2013. The FHLBB stated that it remained in compliance with all regulatory capital ratios at June 30, 2014 and, based on the most recent information available, was classified as “adequately capitalized” by its regulator.

Deposits

The following table presents the Company’s deposit mix at the dates indicated.

	At June 30, 2014						At December 31, 2013
	Amount		Percent of Total		Weighted Average Rate		Amount		Percent of Total		Weighted Average Rate
	(Dollars in Thousands)
Non-interest-bearing accounts	$	716,883	18.6	%	0.00	%	$	707,023	18.4	%	0.00	%
NOW accounts	209,682		5.4	%	0.07	%	210,602		5.5	%	0.07	%
Savings accounts	518,343		13.4	%	0.23	%	494,734		12.9	%	0.25	%
Money market accounts	1,516,023		39.3	%	0.50	%	1,487,979		38.8	%	0.54	%
Certificate of deposit accounts	900,216		23.3	%	0.88	%	934,668		24.4	%	0.91	%
Total interest-bearing deposits	3,144,264		81.4	%	0.54	%	3,127,983		81.6	%	0.57	%
Total deposits	$	3,861,147	100.0	%	0.44	%	$	3,835,006	100.0	%	0.47	%

Total deposits increased slightly to $3.9 billion at June 30, 2014 as compared to $3.8 billion at December 31, 2013. Deposits as percentage of total assets decreased from 72.0% at December 31, 2013 to 69.1% at June 30, 2014. During the first six months of 2014, core deposits increased $60.6 million, or 4.2% on an annualized basis, rising from 75.6% of total deposits at December 31, 2013 to 76.7% of total deposits at June 30, 2014. Certificate of deposit accounts decreased$34.5 million, or 7.4% on an annualized basis, during the first six months of 2014. Certificates of deposit have also fallen as a percentage of total deposits to 23.3% at June 30, 2014 from 24.4% at December 31, 2013.

The Company believes the ongoing shift toward core deposits is due in part to expansion of its cash management capabilities, more effort in seeking deposits from existing customer relationships and the desire of certain depositors to place their funds in a more strongly capitalized financial institution and in more liquid accounts. A rise in interest rates could cause a shift from core deposit accounts to certificate of deposit accounts with longer maturities. Generally, the rates paid on certificates of deposit are higher than those paid on core deposit accounts.

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The following table sets forth the distribution of the average balances of the Company’s deposit accounts for the periods indicated and the weighted average interest rates on each category of deposits presented. Averages for the periods presented are based on daily balances.

	Three Months Ended June 30,
	2014						2013
	Average Balance		Percent of Total Average Deposits		Weighted Average Rate		Average Balance		Percent of Total Average Deposits		Weighted Average Rate
	(Dollars in Thousands)
Core deposits:
Non-interest-bearing demand checking accounts	$	712,961	18.4	%	0.00	%	$	640,725	17.5	%	0.00	%
NOW accounts	208,859		5.4	%	0.08	%	195,269		5.3	%	0.09	%
Savings accounts	523,773		13.5	%	0.23	%	508,451		13.9	%	0.25	%
Money market accounts	1,528,959		39.4	%	0.51	%	1,335,300		36.5	%	0.61	%
Total core deposits	2,974,552		76.7	%	0.31	%	2,679,745		73.2	%	0.36	%
Certificate of deposit accounts	901,272		23.3	%	0.85	%	982,257		26.8	%	0.96	%
Total deposits	$	3,875,824	100.0	%	0.43	%	$	3,662,002	100.0	%	0.52	%

	Six Months Ended June 30,
	2014						2013
	Average Balance		Percent of Total Average Deposits		Weighted Average Rate		Average Balance		Percent of Total Average Deposits		Weighted Average Rate
	(Dollars in Thousands)
Core deposits:
Non-interest-bearing demand checking accounts	$	705,752	18.3	%	0.00	%	$	624,386	17.2	%	0.00	%
NOW accounts	207,550		5.4	%	0.08	%	192,808		5.2	%	0.09	%
Savings accounts	516,206		13.3	%	0.24	%	511,401		14.1	%	0.26	%
Money market accounts	1,517,537		39.3	%	0.52	%	1,315,056		36.2	%	0.63	%
Total core deposits	2,947,045		76.3	%	0.32	%	2,643,651		72.7	%	0.37	%
Certificate of deposit accounts	914,166		23.7	%	0.86	%	992,380		27.3	%	0.96	%
Total deposits	$	3,861,211	100.0	%	0.44	%	$	3,636,031	100.0	%	0.53	%

The following table sets forth the maturity periods for certificates of deposit of $100,000 or more deposited with the Company at the dates indicated:

	At June 30, 2014				At December 31, 2013
	Amount		Weighted Average Rate		Amount		Weighted Average Rate
	(Dollars in Thousands)
Maturity period:
Six months or less	$	185,989	0.73	%	$	181,598	0.70	%
Over six months through 12 months	131,412		0.82	%	139,154		0.86	%
Over 12 months	95,939		1.32	%	103,937		1.32	%
	$	413,340	0.90	%	$	424,689	0.91	%

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Borrowed Funds

Advances from the FHLBB

Although on a long-term basis the Company intends to continue to increase its core deposits, the Company also uses FHLBB borrowings and other wholesale borrowing opportunistically as part of the Company’s overall strategy to fund loan growth and manage interest-rate risk and liquidity. The advances are secured by blanket security agreements which require the Banks to maintain as collateral certain qualifying assets, principally mortgage loans and securities in an aggregate amount at least equal to outstanding advances. The maximum amount that the FHLBB will advance to member institutions, including the Company, fluctuates from time to time in accordance with the policies of the FHLBB. The Company may also borrow from the FRB “discount window” and on $119.0 million of lines of credit as necessary.

FHLBB borrowings increased$0.2 billion to $1.0 billion at June 30, 2014 from the December 31, 2013 balance of $0.8 billion. The increase in FHLBB borrowings was primarily due to loan growth outpacing deposit growth during the first six months of 2014.

The following table sets forth certain information regarding FHLBB advances for the periods indicated:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(Dollars in Thousands)
Average balance outstanding	$	892,770		$	760,237		$	848,495		$	756,773
Maximum amount outstanding at any month-end during the period	1,005,644			785,565			1,005,644			785,565
Balance outstanding at end of period	1,005,644			785,565			1,005,644			785,565
Weighted average interest rate for the period	1.17		%	1.41		%	1.22		%	1.50		%
Weighted average interest rate at end of period	1.05		%	1.32		%	1.05		%	1.32		%

Repurchase Agreements

The Company periodically enters into repurchase agreements with its larger deposit and commercial customers as part of its cash management services which are typically overnight borrowings. Short-term borrowings and repurchase agreements with Company customers decreased$8.4 million during the six months endedJune 30, 2014, from $34.6 million at December 31, 2013 to $26.2 million at June 30, 2014, as customers shifted funds into other deposit products.

Subordinated Debt

In the acquisition of Bancorp Rhode Island, Inc., the Company assumed three subordinated debentures issued by a subsidiary of Bancorp Rhode Island, Inc. In the first quarter of 2013, the Company repaid $3.0 million in subordinated debt before the scheduled maturity in 2031 given the fixed, high cost of the borrowing. The remaining two subordinated debentures are summarized below: 

				Carrying Amount at June 30, 2014		Carrying Amount at December 31, 2013
Issue Date	Rate	Maturity Date	Next Call Date
(Dollars in Thousands)
June 26, 2003	Variable; 3-month LIBOR + 3.10%	June 26, 2033	December 26, 2014	$	4,680	$	4,666
March 17, 2004	Variable; 3-month LIBOR + 2.79%	March 17, 2034	December 17, 2014	$	4,521	$	4,497

Derivative Financial Instruments

The Company has entered into interest-rate swaps with certain of its commercial customers and concurrently enters into offsetting swaps with third-party financial institutions. The Company did not have derivative fair value hedges or derivative cash flow hedges at June 30, 2014 or December 31, 2013. The following table summarizes certain information concerning the Company’s interest-rate swaps at June 30, 2014 and at December 31, 2013:

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	Interest-Rate Swaps
	At June 30, 2014			At December 31, 2013
	(Dollars in Thousands)
Notional principal amounts	$	28,017		$	22,418
Fixed weighted average interest rate from the Company to counterparty	5.4		%	5.7		%
Floating weighted average interest rate from counterparty to the Company	3.5		%	3.5		%
Weighted average remaining term to maturity (in months)	58			47
Fair value:
Recognized as an asset	$	887		$	825
Recognized as a liability	$	912		$	856

Stockholders’ Equity and Dividends

The Company’s total stockholders’ equity was $627.7 million at June 30, 2014, a $13.8 millionincrease compared to $613.9 million at December 31, 2013. The increase primarily reflects net income attributable to the Company of $20.4 million for the six months endedJune 30, 2014, an unrealized gain on securities available-for-sale of $4.8 million (after-tax), offset by dividends paid of $11.9 million in that same period. The dividends approved in the second quarter of 2014 represented the Company’s 61stconsecutive quarter of dividend payments, and the 49th consecutive quarter in which the Company paid a regular dividend of $0.085.

Stockholders’ equity represented 11.23% of total assets at June 30, 2014, as compared to 11.53% at December 31, 2013. Tangible stockholders’ equity (total stockholders’ equity less goodwill and identified intangible assets, net) represented 8.73% of tangible assets (total assets less goodwill and identified intangible assets, net) at June 30, 2014, as compared to 8.88% at December 31, 2013.

Results of Operations — Comparison of the Three-Month and Six-Month Periods Ended June 30, 2014 and June 30, 2013

The primary drivers of the Company’s operating income are net interest income, which is strongly affected by the net yield on interest-earning assets and liabilities (“net interest margin”), the quality of the Company’s assets, its levels of non-interest income and non-interest expense, and its tax provision.

The Company’s net interest income represents the difference between interest income earned on its investments, loans and leases, and its cost of funds. Interest income depends on the amount of interest-earning assets outstanding during the period and the yield earned thereon. Cost of funds is a function of the average amount of deposits and borrowed money outstanding during the period and the interest rates paid thereon. The net interest margin is calculated by dividing net interest income by average interest-earning assets. Net interest spread is the difference between the average rate earned on interest-earning assets and the average rate paid on interest-bearing liabilities. The increases (decreases) in the components of interest income and interest expense, expressed in terms of fluctuation in average volume and rate, are summarized under “Rate/Volume Analysis” below. Information as to the components of interest income, interest expense and average rates is provided under “Average Balances, Net Interest Income, Interest-Rate Spread and Net Interest Margin” below.

Because the Company’s assets and liabilities are not identical in duration and in repricing dates, the differential between the asset and liability repricing and duration is vulnerable to changes in market interest rates as well as the overall shape of the yield curve. These vulnerabilities are inherent to the business of banking and are commonly referred to as “interest-rate risk.” How interest-rate risk is measured and, once measured, how much interest-rate risk is taken is based on numerous assumptions and other subjective judgments. See the discussion in “Item 3. Quantitative and Qualitative Disclosures about Market Risk” below.

The quality of the Company’s assets also influences its earnings. Loans and leases that are not paid on a timely basis and exhibit other weaknesses can result in the loss of principal and/or interest income. Additionally, the Company must make timely provisions to the allowance for loan and lease losses based on estimates of probable losses inherent in the loan and lease portfolio. These additions, which are charged against earnings, are necessarily greater when greater probable losses are expected. Further, the Company incurs expenses as a result of resolving troubled assets. These variables reflect the “credit risk” that the Company takes on in the ordinary course of business and are further discussed under “Financial Condition — Asset Quality” above.

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Net Interest Income

Net interest income of $46.4 million for the quarter ended June 30, 2014increased$1.1 million, or 2.4%, as compared to the second quarter of 2013. This overall increase on a quarter-over-quarter basis was a result of an increase in total interest income of $0.4 million, or 0.8%, to $53.3 million at June 30, 2014 from $52.9 million at June 30, 2013, combined with a decrease in interest expense of $0.6 million, or 8.3%, to $6.9 million at June 30, 2014 from $7.5 million at June 30, 2013. Refer to “Comparison of the Three-Month and Six-Month Periods Ended June 30, 2014 and June 30, 2013 — Interest Income” and “Comparison of the Three-Month and Six-Month Periods Ended June 30, 2014 and June 30, 2013 — Interest Expense” below for more details.

Net interest income of $94.2 million for the six months endedJune 30, 2014increased$5.1 million, or 5.8%, as compared to the six months endedJune 30, 2013. This overall increase on a year-over-year basis was a result of an increase in total interest income of $3.5 million, or 3.4%, to $108.0 million at June 30, 2014 from $104.5 million at June 30, 2013, combined with a decrease in interest expense of $1.6 million, or 10.4%, to $13.9 million at June 30, 2014 from $15.5 million at June 30, 2013. Refer to “Comparison of the Three-Month and Six-Month Periods Ended June 30, 2014 and June 30, 2013 — Interest Income” and “Comparison of the Three-Month and Six-Month Periods Ended June 30, 2014 and June 30, 2013 — Interest Expense” below for more details.

Net interest margin decreased to 3.61% in the second quarter of 2014 from 3.78% in the second quarter of 2013. Net interest margin decreased to 3.71% for the six months endedJune 30, 2014 from 3.74% for the six months endedJune 30, 2013. The decrease in the net interest margin for both periods is the result of repricing interest-earning assets in a lower interest rate environment without a comparable offset in lower funding costs.

The yield on interest-earning assets decreased to 4.15% in the second quarter of 2014 from 4.41% during the second quarter of 2013. In addition to the intense pricing competition in all loan categories, the decrease is also due to a $1.4 million prepayment, which contributed 11 basis points to yields on interest-earning assets, in the second quarter of 2013.

The yield on interest-earning assets decreased to 4.26% for the six months endedJune 30, 2014 from 4.40% for the six months endedJune 30, 2013. The Company benefited from a $5.7 million accretion on acquired loans and leases during the six months endedJune 30, 2014, as compared to $2.5 million during the six months endedJune 30, 2013. This benefit was offset by a decrease in income due to the low interest rate environment.

The overall cost of funds (including non-interest-bearing demand checking accounts) decreased10 basis points to 0.58% for the three months ended June 30, 2014 from 0.68% for the three months ended June 30, 2013. On a year-to-date basis, the overall cost of funds decreased11 basis points to 0.59% for the six months ended June 30, 2014 from 0.70% for the six months ended June 30, 2013. The decrease is driven by a reduction in interest rates offered on money market accounts and certificates of deposit, as well as an increase in FHLBB advances borrowed at lower interest rates.

Future net interest income, net interest spread and net interest margin may continue to be negatively affected by the low interest-rate environment; ongoing pricing pressures in both loan and deposit portfolios; and the ability of the Company to increase its core deposit ratio, increase its non-interest-bearing deposits as a percentage of total deposits, decrease its loan-to-deposit ratio, or decrease its reliance on FHLBB advances. They may also be negatively affected by changes in the amount of accretion on acquired loans and leases, deposits and borrowed funds included in interest income and interest expense.

Average Balances, Net Interest Income, Interest-Rate Spread and Net Interest Margin

The following tables set forth information about the Company’s average balances, interest income and interest rates earned on average interest-earning assets, interest expense and interest rates paid on average interest-bearing liabilities, interest-rate spread and net interest margin for the three months and six months ended June 30, 2014 and June 30, 2013. Average balances are derived from daily average balances and yields include fees, costs and purchase-accounting-related premiums and discounts which are considered adjustments to coupon yields in accordance with GAAP. Certain amounts previously reported have been reclassified to conform to the current period’s presentation.

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	Three Months Ended
	June 30, 2014							June 30, 2013
	Average Balance			Interest (1)		Average Yield/ Cost		Average Balance			Interest (1)		Average Yield/ Cost
	(Dollars in Thousands)
Assets:
Interest-earning assets:
Debt securities	$	527,411		$	2,360	1.79	%	$	487,271		$	1,940	1.59	%
Marketable and restricted equity securities	68,543			602		3.52	%	66,988			350		2.10	%
Short-term investments	36,850			14		0.16	%	52,541			19		0.14	%
Total investments	632,804			2,976		1.88	%	606,800			2,309		1.52	%
Commercial real estate loans (2)	2,288,018			25,395		4.42	%	2,034,920			23,863		4.67	%
Commercial loans and leases (2)	504,572			5,246		4.12	%	420,194			6,531		6.16	%
Equipment financing (2)	541,029			9,155		6.77	%	467,156			8,279		7.10	%
Indirect automobile loans (2)	374,489			3,032		3.25	%	494,571			4,523		3.67	%
Residential mortgage loans (2)	532,310			4,918		3.70	%	512,975			5,101		3.98	%
Other consumer loans (2)	277,802			2,833		4.09	%	264,183			2,508		3.81	%
Total loans and leases	4,518,220			50,579		4.46	%	4,193,999			50,805		4.83	%
Total interest-earning assets	5,151,024			53,555		4.15	%	4,800,799			53,114		4.41	%
Allowance for loan and lease losses	(50,809		)					(42,954		)
Non-interest-earning assets	373,235							380,299
Total assets	$	5,473,450						$	5,138,144
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW accounts	$	208,859		42		0.08	%	$	195,269		41		0.09	%
Savings accounts	523,773			303		0.23	%	508,451			316		0.25	%
Money market accounts	1,528,959			1,936		0.51	%	1,335,300			2,036		0.61	%
Certificates of deposit	901,272			1,920		0.85	%	982,257			2,350		0.96	%
Total interest-bearing deposits (3)	3,162,863			4,201		0.53	%	3,021,277			4,743		0.63	%
Advances from the FHLBB	892,770			2,602		1.17	%	760,237			2,682		1.41	%
Other borrowed funds	35,127			109		1.25	%	48,655			112		0.93	%
Total borrowed funds	927,897			2,711		1.17	%	808,892			2,794		1.39	%
Total interest-bearing liabilities	4,090,760			6,912		0.68	%	3,830,169			7,537		0.79	%
Non-interest-bearing liabilities:
Demand checking accounts (3)	712,961							640,725
Other non-interest-bearing liabilities	39,219							47,589
Total liabilities	4,842,940							4,518,483
Brookline Bancorp, Inc. stockholders’ equity	626,371							616,327
Noncontrolling interest in subsidiary	4,139							3,334
Total liabilities and equity	$	5,473,450						$	5,138,144
Net interest income (tax-equivalent basis) / Interest-rate spread (4)				46,643		3.47	%				45,577		3.62	%
Less adjustment of tax-exempt income				209							214
Net interest income				$	46,434						$	45,363
Net interest margin (5)						3.61	%						3.78	%

(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.

(2) Loans on nonaccrual status are included in the average balances.

(3) Including non-interest-bearing checking accounts, the average interest rate on total deposits was 0.43% and 0.52% in the three months ended June 30, 2014 and June 30, 2013, respectively.

(4) Interest-rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.

(5) Net interest margin represents net interest income (tax equivalent basis) divided by average interest-earning assets.

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	Six Months Ended
	June 30, 2014							June 30, 2013
	Average Balance			Interest (1)		Average Yield/ Cost		Average Balance			Interest (1)		Average Yield/ Cost
	(Dollars in Thousands)
Assets:
Interest-earning assets:
Debt securities	515,073			4,623		1.80	%	$	479,433		$	3,799	1.58	%
Marketable and restricted equity securities	67,753			1,099		3.26	%	67,764			705		2.09	%
Short-term investments	41,317			58		0.28	%	53,586			50		0.19	%
Total investments	624,143			5,780		1.85	%	600,783			4,554		1.52	%
Commercial real estate loans (2)	2,258,422			51,097		4.51	%	2,018,117			48,159		4.76	%
Commercial loans (2)	489,732			9,939		4.04	%	415,633			11,242		5.39	%
Equipment financing (2)	532,570			20,192		7.60	%	453,642			16,138		7.15	%
Indirect automobile loans (2)	379,633			6,296		3.34	%	510,657			9,439		3.73	%
Residential mortgage loans (2)	532,451			9,727		3.68	%	510,801			10,266		4.04	%
Other consumer loans (2)	272,532			5,412		4.00	%	264,433			5,124		3.91	%
Total loans and leases	4,465,340			102,663		4.60	%	4,173,283			100,368		4.81	%
Total interest-earning assets	5,089,483			108,443		4.26	%	4,774,066			104,922		4.40	%
Allowance for loan and lease losses	(49,953		)					(42,225		)
Non-interest-earning assets	378,363							371,475
Total assets	$	5,417,893						$	5,103,316
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW accounts	$	207,550		$	83	0.08	%	$	192,808		$	86	0.09	%
Savings accounts	516,206			606		0.24	%	511,401			660		0.26	%
Money market accounts	1,517,537			3,895		0.52	%	1,315,056			4,097		0.63	%
Certificates of deposit	914,166			3,908		0.86	%	992,380			4,735		0.96	%
Total interest-bearing deposits (3)	3,155,459			8,492		0.54	%	3,011,645			9,578		0.64	%
Advances from the FHLBB	848,495			5,133		1.22	%	756,773			5,637		1.50	%
Other borrowed funds	36,773			247		1.36	%	54,303			266		0.99	%
Total borrowed funds	885,268			5,380		1.23	%	811,076			5,903		1.47	%
Total interest-bearing liabilities	4,040,727			13,872		0.69	%	3,822,721			15,481		0.82	%
Non-interest-bearing liabilities:
Demand checking accounts (3)	705,752							624,386
Other non-interest-bearing liabilities	43,141							35,750
Total liabilities	4,789,620							4,482,857
Brookline Bancorp, Inc. stockholders’ equity	624,080							616,868
Noncontrolling interest in subsidiary	4,193							3,591
Total liabilities and equity	$	5,417,893						$	5,103,316
Net interest income (tax-equivalent basis) / Interest-rate spread (4)				94,571		3.57	%				89,441		3.58	%
Less adjustment of tax-exempt income				403							411
Net interest income				$	94,168						$	89,030
Net interest margin (5)						3.71	%						3.74	%

(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.

(2) Loans on nonaccrual status are included in the average balances.

(3) Including non-interest-bearing checking accounts, the average interest rate on total deposits was 0.44% and 0.53% in the six months ended June 30, 2014 and June 30, 2013, respectively.

(4) Interest-rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.

(5) Net interest margin represents net interest income (tax equivalent basis) divided by average interest-earning assets.

Rate/Volume Analysis

The following table presents, on a tax-equivalent basis, the extent to which changes in interest rates and changes in volume of interest-earning assets and interest-bearing liabilities have affected the Company’s interest income and interest expense during the periods indicated. Information is provided in each category with respect to: (i) changes attributable to changes in volume (changes in volume multiplied by prior rate), (ii) changes attributable to changes in rate (changes in rate multiplied by

75

prior volume) and (iii) the net change. The changes attributable to the combined impact of volume and rate have been allocated proportionately to the changes due to volume and the changes due to rate.

	Three Months Ended June 30, 2014 as Compared to the Three Months Ended June 30, 2013									Six Months Ended June 30, 2014 as Compared to the Six Months Ended June 30, 2013
	Increase									Increase
	(Decrease) Due To									(Decrease) Due To
	Volume			Rate			Net			Volume			Rate			Net
	(In Thousands)
Interest and dividend income
Debt securities	$	168		$	252		$	420		$	287		$	537		$	824
Marketable and restricted equity securities	8			244			252			—			394			394
Short-term investments	(7		)	2			(5		)	(13		)	21			8
Total investments	169			498			667			274			952			1,226
Loans and leases:
Commercial real estate loans	2,835			(1,303		)	1,532			5,511			(2,573		)	2,938
Commercial loans and leases	1,130			(2,415		)	(1,285		)	1,772			(3,075		)	(1,303		)
Equipment financing	1,270			(394		)	876			2,977			1,077			4,054
Indirect automobile loans	(1,015		)	(476		)	(1,491		)	(2,233		)	(910		)	(3,143		)
Residential mortgage loans	188			(371		)	(183		)	414			(953		)	(539		)
Other consumer loans	133			192			325			164			124			288
Total loans and leases	4,541			(4,767		)	(226		)	8,605			(6,310		)	2,295
Total change in interest and dividend income	4,710			(4,269		)	441			8,879			(5,358		)	3,521
Interest expense
Deposits:
NOW accounts	3			(2		)	1			7			(10		)	(3		)
Savings accounts	10			(23		)	(13		)	5			(59		)	(54		)
Money market accounts	269			(369		)	(100		)	578			(780		)	(202		)
Certificates of deposit	(180		)	(250		)	(430		)	(356		)	(471		)	(827		)
Total deposits	102			(644		)	(542		)	234			(1,320		)	(1,086		)
Borrowed funds:
Advances from the FHLBB	426			(506		)	(80		)	629			(1,133		)	(504		)
Other borrowed funds	(36		)	33			(3		)	(101		)	82			(19		)
Total borrowed funds	390			(473		)	(83		)	528			(1,051		)	(523		)
Total change in interest expense	492			(1,117		)	(625		)	762			(2,371		)	(1,609		)
Change in tax-exempt income	(5		)	—			(5		)	(8		)	—			(8		)
Change in net interest income	$	4,223		$	(3,152	)	$	1,071		$	8,125		$	(2,987	)	$	5,138

76

Interest Income

Loans and Leases

	Three Months Ended June 30,				Dollar			Percent		Six Months Ended   June 30,				Dollar			Percent
	2014		2013		Change			Change		2014		2013		Change			Change
	(Dollars in Thousands)
Interest income — loans and leases:
Commercial real estate loans	$	25,265	$	23,702	$	1,563		6.6	%	$	50,837	$	47,854	$	2,983		6.2	%
Commercial loans	5,231		6,531		(1,300		)	-19.9	%	9,911		11,242		(1,331		)	-11.8	%
Equipment financing	9,155		8,279		876			10.6	%	20,192		16,138		4,054			25.1	%
Indirect automobile loans	3,032		4,523		(1,491		)	-33.0	%	6,296		9,439		(3,143		)	-33.3	%
Residential mortgage loans	4,917		5,101		(184		)	-3.6	%	9,727		10,266		(539		)	-5.3	%
Other consumer loans	2,833		2,508		325			13.0	%	5,412		5,124		288			5.6	%
Total interest income — loans and leases	$	50,433	$	50,644	$	(211	)	-0.4	%	$	102,375	$	100,063	$	2,312		2.3	%

Except for equipment financing and other consumer loans, declines in the yields on all portfolios reflect the high rate of loan refinancings and the intense pricing competition which affected the Company’s lending markets.

Interest income from loans and leases was $50.4 million for the three months ended June 30, 2014, resulting in a yield on total loans and leases of 4.46%. This compares to $50.6 million of interest on loans and leases and a yield of 4.83% for the three months ended June 30, 2013. The year-over-year $0.2 milliondecrease in interest income from loans and leases was due to a decrease of $4.8 million due to changes in rate, offset by an increase of $4.5 million due to increased origination volume. Accretion on acquired loans and leases of $1.5 million contributed 11 basis points to net interest margin during the second quarter of 2014, compared to $1.4 million and 11 basis points in the second quarter of 2013. 

Interest income from loans and leases was $102.4 million for the six months endedJune 30, 2014, resulting in a yield on total loans and leases of 4.60%. This compares to $100.1 million of interest on loans and leases and a yield of 4.81% for the six months endedJune 30, 2013. The year-over-year $2.3 millionincrease in interest income from loans and leases was due to an increase of $8.6 million due to origination volume, offset by a decrease of $6.3 million due to changes in rate. Accretion on acquired loans and leases of $5.7 million contributed 22 basis points to net interest margin for the six months endedJune 30, 2014, compared to $2.5 million and 10 basis points for the six months endedJune 30, 2013. This increase was due to a reforecast of one acquired equipment financing pool and improved credit quality and expected cash flows on certain acquired commercial real estate loans and leases.

Investments

	Three Months Ended June 30,				Dollar			Percent		Six Months Ended June 30,				Dollar		Percent
	2014		2013		Change			Change		2014		2013		Change		Change
	(Dollars in Thousands)
Interest income — investments:
Debt securities	$	2,360	$	1,934	$	426		22.0	%	$	4,619	$	3,786	$	833	22.0	%
Marketable and restricted equity securities	539		303		236			77.9	%	988		612		376		61.4	%
Short-term investments	14		19		(5		)	-26.3	%	58		50		8		16.0	%
Total interest income — investments	$	2,913	$	2,256	$	657		29.1	%	$	5,665	$	4,448	$	1,217	27.4	%

Total investment income was $2.9 million for the three months ended June 30, 2014, compared to $2.3 million for the three months ended June 30, 2013. The yield on investments increased to 1.88% for the quarter ended June 30, 2014 from 1.52% for the quarter ended June 30, 2013. The $0.7 million year-over-year increase in quarterly interest income on investments was largely driven by higher rates.

77

Total investment income was $5.7 million for the six months endedJune 30, 2014, compared to $4.4 million for the six months ended ended June 30, 2013. The yield on investments increased to 1.85% for the six months endedJune 30, 2014 from 1.52% for the six months endedJune 30, 2013. The $1.2 million year-over-year increase in quarterly interest income on investments was largely driven by higher rates.

Interest Expense - Deposits and Borrowed Funds

	Three Months Ended June 30,				Dollar			Percent		Six Months Ended June 30,				Dollar			Percent
	2014		2013		Change			Change		2014		2013		Change			Change
	(Dollars in Thousands)
Interest expense:
Deposits:
NOW accounts	$	42	$	41	$	1		2.4	%	$	83	$	86	$	(3	)	-3.5	%
Savings accounts	303		316		(13		)	-4.1	%	606		660		(54		)	-8.2	%
Money market accounts	1,936		2,036		(100		)	-4.9	%	3,895		4,097		(202		)	-4.9	%
Certificates of deposit	1,920		2,350		(430		)	-18.3	%	3,908		4,735		(827		)	-17.5	%
Total interest expense - deposits	4,201		4,743		(542		)	-11.4	%	8,492		9,578		(1,086		)	-11.3	%
Borrowed funds:
Advances from the FHLBB	2,602		2,682		(80		)	-3.0	%	5,133		5,637		(504		)	-8.9	%
Other borrowed funds	109		112		(3		)	-2.7	%	247		266		(19		)	-7.1	%
Total interest expense - borrowed funds	2,711		2,794		(83		)	-3.0	%	5,380		5,903		(523		)	-8.9	%
Total interest expense	$	6,912	$	7,537	$	(625	)	-8.3	%	$	13,872	$	15,481	$	(1,609	)	-10.4	%

Deposits

Ongoing declines in the interest rates paid on deposits and continued declines in certificate of deposit balances as a percentage of total deposits contributed to reductions in the Company’s overall cost of deposits.

Interest expense on deposits decreased $0.5 million, or 11.4%, from $4.7 million for the quarter ended June 30, 2013 to $4.2 million for the quarter ended June 30, 2014. Accretion on acquired deposits was $0.1 million in both periods, which improved the Company’s net interest margin by 1 basis point in both periods.

Interest expense on deposits decreased $1.1 million, or 11.3%, from $9.6 million for the six months endedJune 30, 2013 to $8.5 million for the six months endedJune 30, 2014. Accretion on acquired deposits was $0.1 million and $0.3 million for the six months endedJune 30, 2014 and 2013, respectively, which improved the Company’s net interest margin by 1 basis point in both periods.

While interest-bearing deposit balances increased during these periods, the increases in interest expense on deposits due to volume were offset by decreases in interest expense due to deposit offering rates. The cost of total interest-bearing deposits decreased from 0.63% during the three months ended June 30, 2013 to 0.53% in the three months ended June 30, 2014. The cost of total interest-bearing deposits decreased to 0.54% in the six months endedJune 30, 2014 from 0.64% during the six months endedJune 30, 2013.

Borrowed Funds

Interest paid on borrowed funds decreased by $0.1 million, or 3.0% from $2.8 million for the three months ended June 30, 2013 to $2.7 million for the three months ended June 30, 2014. The cost of borrowed funds declined to 1.17% for the quarter ended June 30, 2014 from 1.39% during the three months ended June 30, 2013. Including accretion, decreases in borrowing rates resulted in a decrease in debt-related interest expenses of $0.5 million. Accretion on acquired borrowed funds of $0.7 million and $0.9 million improved the Company’s net interest margin by 7 basis points and 8 basis points for the three months ended June 30, 2014 and 2013, respectively.

78

Interest paid on borrowed funds decreased by $0.5 million, or 8.9% from $5.9 million for the six months endedJune 30, 2013 to $5.4 million for the six months endedJune 30, 2014. The cost of borrowed funds declined to 1.23% for the six months endedJune 30, 2014 from 1.47% during the six months endedJune 30, 2013. Including accretion, decreases in borrowing rates resulted in a decrease in debt-related interest expenses of $1.1 million. Accretion on acquired borrowed funds of $1.4 million and $2.0 million improved the Company’s net interest margin by 7 basis points and 9 basis points for the six months endedJune 30, 2014 and 2013, respectively.

Provision for Credit Losses

The provisions for credit losses are set forth below:

	Three Months Ended June 30,						Dollar			Percent		Six Months Ended June 30,						Dollar			Percent
	2014			2013			Change			Change		2014			2013			Change			Change
	(Dollars in Thousands)
Provision (credit) for loan and lease losses:
Commercial real estate	$	1,857		$	1,512		$	345		22.8	%	$	3,693		$	2,078		$	1,615		77.7	%
Commercial	900			434			466			107.4	%	1,524			1,596			(72		)	-4.5	%
Indirect automobile	77			(136		)	213			-156.6	%	2			(208		)	210			-101.0	%
Consumer	(6		)	497			(503		)	-101.2	%	(90		)	574			(664		)	-115.7	%
Unallocated	(646		)	81			(727		)	-897.5	%	(530		)	147			(677		)	-460.5	%
Total provision for loan and lease losses	2,182			2,388			(206		)	-8.6	%	4,599			4,187			412			9.8	%
Unfunded credit commitments	94			51			43			84.3	%	120			107			13			12.1	%
Total provision for credit losses	$	2,276		$	2,439		$	(163	)	-6.7	%	$	4,719		$	4,294		$	425		9.9	%

The provisions for credit losses for the second quarter of 2014 and 2013 were $2.3 million and $2.4 million, respectively. The provisions for credit losses for the six months endedJune 30, 2014 and 2013 were $4.7 million and $4.3 million, respectively. The $0.2 million quarter-over-quarter decrease in the provision for loan and lease losses was due in large part to an increase in the allowance for loan and lease losses on the acquired portfolios during the six months endedJune 30, 2013, no additional provision on the acquired portfolio was necessary during the six months endedJune 30, 2014, coupled with a reduction in the unallocated allowance, offset by loan growth of $241.4 million during the six months endedJune 30, 2014. See management’s discussion of “Financial Condition — Allowance for Loan and Lease Losses” and Note 5, “Allowance for Loan and Lease Losses,” to the unaudited consolidated financial statements for a description of how management determined the allowance for loan and lease losses for each portfolio and class of loans.

79

Non-Interest Income

The following table sets forth the components of non-interest income for the periods indicated:

	Three Months Ended June 30,						Dollar			Percent		Six Months Ended June 30,						Dollar			Percent
	2014			2013			Change			Change		2014			2013			Change			Change
	(Dollars in Thousands)
Deposit fees	$	2,204		$	1,929		$	275		14.3	%	4,163			3,995			168			4.2	%
Loan fees	124			386			(262		)	-67.9	%	560			807			(247		)	-30.6	%
Loss from investments in affordable housing projects	(539		)	(624		)	85			-13.6	%	(1,043		)	(936		)	(107		)	11.4	%
Gain on sales of securities, net	(13		)	—			(13		)	—	%	(13		)	—			(13		)	—	%
Gain on sales of loans and leases held-for-sale	54			183			(129		)	-70.5	%	656			481			175			36.4	%
Gain on sale/disposals of premises and equipment, net	(6		)	(21		)	15			-71.4	%	1,504			(21		)	1,525			-7,261.9	%
Other	1,466			1,286			180			14.0	%	2,587			2,140			447			20.9	%
Total non-interest income	$	3,290		$	3,139		$	151		4.8	%	$	8,414		$	6,466		$	1,948		30.1	%

Total non-interest income increased$0.2 million, or 4.8%, to $3.3 million for the three months ended June 30, 2014, from $3.1 million for the three months ended June 30, 2013. The increase is primarily attributable to a $0.3 millionincrease in deposit fees, a $0.1 milliondecrease in the losses from investment in affordable housing projects and a $0.1 million increase in rental income included in other non-interest income, offset by a decrease of $0.3 million in loan fees and a $0.1 milliondecrease in gain on sales of loans and leases held-for-sale.

Total non-interest income increased$1.9 million, or 30.1%, to $8.4 million for the six months ended June 30, 2014, from $6.5 million for the six months ended June 30, 2013. The increase is primarily attributable to a $1.5 million net gain on sale/disposals of premises and equipment, a $0.2 million increase in rental income included in other non-interest income, a $0.2 millionincrease in gain on sales of loans and leases held-for-sale, a $0.2 millionincrease in deposit fees, offset by a $0.2 milliondecrease in loan fees.

Non-Interest Expense

The following table sets forth the components of non-interest expense:

	Three Months Ended June 30,				Dollar			Percent		Six Months Ended June 30,				Dollar			Percent
	2014		2013		Change			Change		2014		2013		Change			Change
	(Dollars in Thousands)
Compensation and employee benefits	$	17,295	$	16,697	$	598		3.6	%	$	35,327	$	32,994	$	2,333		7.1	%
Occupancy	3,154		2,865		289			10.1	%	7,559		5,948		1,611			27.1	%
Equipment and data processing	4,348		4,262		86			2.0	%	8,725		8,362		363			4.3	%
Professional services	1,487		1,513		(26		)	-1.7	%	3,214		3,014		200			6.6	%
FDIC insurance	847		936		(89		)	-9.5	%	1,707		1,870		(163		)	-8.7	%
Advertising and marketing	776		768		8			1.0	%	1,441		1,438		3			0.2	%
Amortization of identified intangible assets	827		1,177		(350		)	-29.7	%	1,688		2,342		(654		)	-27.9	%
Other	2,488		2,598		(110		)	-4.2	%	5,137		5,617		(480		)	-8.5	%
Total non-interest expense	$	31,222	$	30,816	$	406		1.3	%	$	64,798	$	61,585	$	3,213		5.2	%

Non-interest expense for the three months ended June 30, 2014increased$0.4 million compared to the same period in 2013. The increase was due to a $0.6 millionincrease in compensation and employee benefits expense, a $0.3 millionincrease in occupancy expense, offset by a decrease of $0.4 million in amortization of identified intangible assets and a decrease of $0.1

80

million in other expenses. Non-interest expense for the six months endedJune 30, 2014increased$3.2 million compared to the same period in 2013. The increase was primarily due to a $2.3 millionincrease in compensation and employee benefits expense, a $1.6 millionincrease in occupancy expense, offset by a decrease of $0.7 million in amortization of identified intangible assets and a decrease of $0.5 million in other expenses.

The efficiency ratio decreased to 62.79% for the three-month period ending June 30, 2014 from 63.53% for the three-month period ending June 30, 2013. The efficiency ratio decreased to 63.17% for the six-month period ending June 30, 2014 from 64.49% for the six-month period ending June 30, 2013. Efficiency ratios improved because increases in non-interest expense was outpaced by increases in net interest income and non-interest income.

Compensation and employee benefit expense for the three months ended June 30, 2014increased$0.6 million, or 3.6%, as compared to the same period in 2013, and increased$2.3 million, or 7.1%, for the six months endedJune 30, 2014 as compared to the same period in 2013. The increases in both periods were driven primarily by additional staffing for the opening of the Waltham, MA, branch of Brookline Bank and Wakefield, RI, branch of Bank Rhode Island and to support the growth in equipment financing.

Occupancy expense for the three months ended June 30, 2014increased$0.3 million, or 10.1%, as compared to the same period in 2013. Occupancy expense for the six months endedJune 30, 2014increased$1.6 million, or 27.1%, as compared to the same period in 2013. The increases in both periods were primarily due to additional expenses associated with the newly opened branches, as well as the recognition of future lease obligation associated with the consolidation of an operations center and three discontinued branch properties.

Amortization of identified intangible assets for the three months ended June 30, 2014 decreased $0.4 million, or 29.7%, as compared to the same period in 2013, and decreased $0.7 million, or 27.9%, for the six months endedJune 30, 2014 as compared to the same period in 2013. The decreases in both periods were due to the accelerated method of amortization for certain intangible assets and that several intangible assets that were fully amortized at December 31, 2013.

Other expense decreased $0.1 million, or 4.2%, from the three months ended June 30, 2013 to the three months ended June 30, 2014. Other expense decreased $0.5 million, or 8.5%, from the six months endedJune 30, 2013 to the six months endedJune 30, 2014. The decreases in both periods were largely due to cost reduction costs related to the runoff of the indirect auto portfolio.

Provision for Income Taxes

	Three Months Ended June 30,						Dollar		Percent		Six Months Ended June 30,						Dollar		Percent
	2014			2013			Change		Change		2014			2013			Change		Change
	(Dollars in Thousands)
Income before provision for income taxes	$	16,226		$	15,247		$	979	6.4	%	$	33,065		$	29,617		$	3,448	11.6	%
Provision for income taxes	5,774			5,382			392		7.3	%	11,769			10,511			1,258		12.0	%
Net income	$	10,452		$	9,865		$	587	6.0	%	$	21,296		$	19,106		$	2,190	11.5	%
Effective tax rate	35.6		%	35.3		%	N/A		0.8	%	35.6		%	35.5		%	N/A		0.3	%

The Company recorded income tax expense of $5.8 million for the three months ended June 30, 2014, compared to $5.4 million for the three months ended June 30, 2013, representing effective tax rates of 35.6% and 35.3%, respectively.  On a year-to-date basis, the Company recorded income tax expense of $11.8 million for the first six months of 2014, compared to $10.5 million for the same period of 2013, representing effective tax rates of 35.6% and 35.5%, respectively.

The slight increase in the effective tax rate is primarily attributable to the absence of the rehabilitation tax credit in 2014. The increase was partially offset by tax credits received from the investment in two new affordable housing projects.

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Liquidity and Capital Resources

Liquidity

Liquidity is defined as the ability to meet current and future financial obligations of a short-term nature. The Company further defines liquidity as the ability to respond to the needs of depositors and borrowers, as well as to earnings enhancement opportunities, in a changing marketplace. Liquidity management is monitored by an Asset/Liability Committee (“ALCO”), consisting of members of management, which is responsible for establishing and monitoring liquidity targets as well as strategies and tactics to meet these targets.

The primary source of funds for the payment of dividends and expenses by the Company is dividends paid to it by its Banks and Brookline Securities Corp. The primary sources of liquidity for the Banks consist of deposit inflows, loan repayments, borrowed funds and maturing investment securities.

Deposits, which are considered the most stable source of liquidity, totaled $3.9 billion at June 30, 2014, and represented 78.8% of total funding (the sum of total deposits and total borrowings), compared to deposits of $3.8 billion, or 82.5% of total funding, at December 31, 2013. Core deposits, which consist of demand checking, NOW, savings and money market accounts, totaled $3.0 billion at June 30, 2014 and represented 76.7% of total deposits, compared to core deposits of $2.9 billion, or 75.6% of total deposits, at December 31, 2013. While deposits are considered the most reliable source of liquidity, the Company is careful to increase deposits without adversely impacting the weighted average cost of those funds.

Borrowings are used to diversify the Company’s funding mix and to support asset growth. When profitable lending and investment opportunities exist, access to borrowings provides a means to grow the balance sheet. Borrowings totaled $1.0 billion at June 30, 2014, representing 21.2% of total funding, compared to $0.8 billion, or 17.5% of total funding, at December 31, 2013. As members of the FHLBB, the Banks have access to both short- and long-term borrowings. The Banks also have access to funding through retail repurchase agreements, brokered deposits and $119.0 million of uncommitted lines of credit, and may utilize additional sources of funding in the future, including borrowings at the Federal Reserve “discount window,” to supplement its liquidity. At June 30, 2014, the Company’s total borrowing limit from the FHLBB for advances and repurchase agreements was $1.2 billion as compared to $1.0 billion at December 31, 2013, based on the level of qualifying collateral available for these borrowings.

In general, the Company seeks to maintain a high degree of liquidity and targets cash, cash equivalents and investment securities available-for-sale balances between 10% and 30% of total assets. At June 30, 2014, cash and cash equivalents and available-for-sale securities totaled $608.3 million, or 10.9% of total assets. This compares to $584.9 million, or 11.0% of total assets at December 31, 2013.

While management believes that the Company has adequate liquidity to meet its commitments, and to fund the Banks’ lending and investment activities, the availabilities of these funding sources are subject to broad economic conditions and could be restricted in the future. Such restrictions would impact the Company’s immediate liquidity and/or additional liquidity needs.

Off-Balance-Sheet Financial Instruments

The Company is party to off-balance-sheet financial instruments in the normal course of business to meet the financing needs of its customers and to reduce its own exposure to fluctuations in interest rates. These financial instruments include loan commitments, standby and commercial letters of credit and interest-rate swaps. According to GAAP, these financial instruments are not recorded in the financial statements until they are funded or related fees are incurred or received.

The contract amounts reflect the extent of the involvement the Company has in particular classes of these instruments. Such commitments involve, to varying degrees, elements of credit risk and interest-rate risk in excess of the amount recognized in the consolidated balance sheet. The Company’s exposure to credit loss in the event of non-performance by the counterparty is represented by the contractual amount of the instruments. The Company uses the same policies in making commitments and conditional obligations as it does for on-balance-sheet instruments.

82

Financial instruments with off-balance-sheet risk at the dates indicated follow:

	At June 30, 2014		At December 31, 2013
	(In Thousands)
Financial instruments whose contract amounts represent credit risk:
Commitments to originate loans and leases:
Commercial real estate	$	67,378	$	48,973
Commercial	146,347		143,252
Residential mortgage	10,524		8,027
Unadvanced portion of loans and leases	549,473		586,279
Unused lines of credit:
Home equity	212,857		205,665
Other consumer	6,386		6,503
Other commercial	1,138		1,035
Unused letters of credit:
Financial standby letters of credit	18,322		20,410
Performance standby letters of credit	3,189		2,989
Commercial and similar letters of credit	2,302		440
Back-to-back interest-rate swaps	28,017		22,418

Capital Resources

At June 30, 2014, the Company and the Banks are all under the primary regulation of and must comply with the capital requirements of the FRB. At that date, the Company, Brookline Bank, BankRI and First Ipswich exceeded all regulatory capital requirements and were considered “well-capitalized.”

83

The Company’s and the Banks’ actual and required capital amounts and ratios are as follows:

		Actual				Minimum Required for Capital Adequacy Purposes				Minimum Required To Be Considered “Well-Capitalized”
		Amount		Ratio		Amount		Ratio		Amount		Ratio
		(Dollars in Thousands)
At June 30, 2014:
Brookline Bancorp, Inc.
Tier 1 leverage capital ratio	(1)	$	490,886	9.2	%	$	212,735	4.0	%	N/A		N/A
Tier 1 risk-based capital ratio	(2)	490,886		10.6	%	184,891		4.0	%	N/A		N/A
Total risk-based capital ratio	(3)	543,728		11.8	%	369,569		8.0	%	N/A		N/A
Brookline Bank
Tier 1 leverage capital ratio	(1)	$	292,341	8.7	%	$	134,255	4.0	%	$	167,819	5.0	%
Tier 1 risk-based capital ratio	(2)	292,341		9.6	%	122,191		4.0	%	183,286		6.0	%
Total risk-based capital ratio	(3)	330,522		10.8	%	244,379		8.0	%	305,473		10.0	%
BankRI
Tier 1 leverage capital ratio	(1)	$	143,642	8.3	%	$	69,476	4.0	%	$	86,845	5.0	%
Tier 1 risk-based capital ratio	(2)	143,642		10.7	%	53,598		4.0	%	80,397		6.0	%
Total risk-based capital ratio	(3)	156,098		11.6	%	107,284		8.0	%	134,105		10.0	%
First Ipswich
Tier 1 leverage capital ratio	(1)	$	31,372	10.3	%	$	12,183	4.0	%	$	15,229	5.0	%
Tier 1 risk-based capital ratio	(2)	31,372		13.0	%	9,631		4.0	%	14,446		6.0	%
Total risk-based capital ratio	(3)	33,557		13.9	%	19,272		8.0	%	24,090		10.0	%
At December 31, 2013:
Brookline Bancorp, Inc.
Tier 1 leverage capital ratio	(1)	$	480,472	9.4	%	$	205,330	4.0	%	N/A		N/A
Tier 1 risk-based capital ratio	(2)	480,472		11.0	%	174,558		4.0	%	N/A		N/A
Total risk-based capital ratio	(3)	529,982		12.2	%	348,959		8.0	%	N/A		N/A
Brookline Bank
Tier 1 leverage capital ratio	(1)	$	299,822	9.4	%	$	127,992	4.0	%	$	159,990	5.0	%
Tier 1 risk-based capital ratio	(2)	299,822		10.4	%	114,984		4.0	%	172,477		6.0	%
Total risk-based capital ratio	(3)	335,748		11.7	%	229,768		8.0	%	287,210		10.0	%
BankRI
Tier 1 leverage capital ratio	(1)	$	134,904	8.1	%	$	66,784	4.0	%	$	83,480	5.0	%
Tier 1 risk-based capital ratio	(2)	134,904		10.6	%	51,052		4.0	%	76,577		6.0	%
Total risk-based capital ratio	(3)	145,847		11.4	%	102,080		8.0	%	127,600		10.0	%
First Ipswich
Tier 1 leverage capital ratio	(1)	$	30,435	9.8	%	$	12,461	4.0	%	$	15,576	5.0	%
Tier 1 risk-based capital ratio	(2)	30,435		13.6	%	8,971		4.0	%	13,457		6.0	%
Total risk-based capital ratio	(3)	32,289		14.4	%	17,938		8.0	%	22,423		10.0	%

1. Tier 1 leverage capital ratio is calculated by dividing Tier 1 capital by average assets.

2. Tier 1 risk-based capital ratio is calculated by dividing Tier 1 capital by risk-weighted assets.

3. Total risk-based capital ratio is calculated by dividing total capital by risk-weighted assets.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

Market Risk

Market risk is the risk that the market value or estimated fair value of the Company’s assets, liabilities and derivative financial instruments will decline as a result of changes in interest rates or financial market volatility, or that the Company’s net income will be significantly reduced by interest-rate changes.

Interest-Rate Risk

The principal market risk facing the Company is interest-rate risk, which can come in a variety of forms, including repricing risk, yield-curve risk, basis risk and prepayment risk. Repricing risk exists when the change in the average yield of either interest-earning assets or interest-bearing liabilities is more sensitive than the other to changes in market interest rates. Such a change in sensitivity could reflect a number of possible mismatches in the repricing opportunities of the Company’s assets and liabilities. Yield-curve risk reflects the possibility that the changes in the shape of the yield curve could have different effects on the Company’s assets and liabilities. Basis risk exists when different parts of the balance sheet are subject to varying base rates reflecting the possibility that the spread from those base rates will deviate. Prepayment risk is associated with financial instruments with an option to prepay before the stated maturity, often a disadvantage to the person selling the option; this risk is most often associated with the prepayment of loans, callable investments, and callable borrowings.

Asset/Liability Management

Market risk and interest-rate risk management is governed by the Company’s Asset/Liability Committee (“ALCO”). The ALCO establishes exposure limits that define the Company’s tolerance for interest-rate risk. The ALCO and Treasury Group measure and manage the composition of the balance sheet over a range of possible changes in interest rates while remaining responsive to market demand for loan and deposit products. The ALCO monitors current exposures versus limits and reports results to the Board of Directors. The policy limits and guidelines serve as benchmarks for measuring interest-rate risk and for providing a framework for evaluation and interest-rate risk-management decision-making. The Company measures its interest-rate risk by using an asset/liability simulation model. The model considers several factors to determine the Company’s potential exposure to interest-rate risk, including measurement of repricing gaps, duration, convexity, value-at-risk, market value of portfolio equity under assumed changes in the level of interest rates, the shape of yield curves and general market volatility.

Management controls the Company’s interest-rate exposure using several strategies, which include adjusting the maturities of securities in the Company’s investment portfolio, limiting or expanding the terms of loans originated and limiting fixed-rate deposits with terms of more than five years and adjusting maturities of FHLBB advances. The Company limits this risk by restricting the types of MBSs it invests in to those with limited average life changes under certain interest-rate-shock scenarios, or securities with embedded prepayment penalties. The Company also places limits on holdings of fixed-rate mortgage loans with maturities greater than five years. The Company also may use derivative instruments, principally interest-rate swaps, to manage its interest-rate risk; however, the Company had no derivative fair value hedges or derivative cash flows at June 30, 2014 or December 31, 2013. See Note 9, “Derivatives and Hedging Activities,” to the unaudited consolidated financial statements.

85

Measuring Interest-Rate Risk

As noted above, interest-rate risk can be measured by analyzing the extent to which the repricing of assets and liabilities are mismatched to create an interest-rate sensitivity gap. An asset or liability is said to be interest-rate sensitive within a specific period if it will mature or reprice within that period. The interest-rate sensitivity gap is defined as the difference between the amount of interest-earning assets maturing or repricing within a specific time period and the amount of interest-bearing liabilities maturing or repricing within that same time period. A gap is considered positive when the amount of interest-rate-sensitive assets exceeds the amount of interest-rate-sensitive liabilities. A gap is considered negative when the amount of interest-rate-sensitive liabilities exceeds the amount of interest-rate-sensitive assets. During a period of falling interest rates, therefore, a positive gap would tend to adversely affect net interest income. Conversely, during a period of rising interest rates, a positive gap position would tend to result in an increase in net interest income.

The Company's interest-rate risk position is measured using both income simulation and interest-rate sensitivity "gap" analysis. Income simulation is the primary tool for measuring the interest-rate risk inherent in the Company’s balance sheet at a given point in time by showing the effect on net interest income, over a twelve-month period, of a variety of interest-rate shocks. These simulations take into account repricing, maturity and prepayment characteristics of individual products. The ALCO reviews simulation results to determine whether the exposure resulting from changes in market interest rates remains within established tolerance levels over a twelve-month horizon, and develops appropriate strategies to manage this exposure. The Company’s interest-rate risk analysis remains modestly asset-sensitive at June 30, 2014.

At June 30, 2014, net interest income simulation indicated that the Company’s exposure to changing interest rates was within established tolerances. The ALCO reviews the methodology utilized for calculating interest-rate risk exposure and may periodically adopt modifications to this methodology. The following table presents the estimated impact of interest-rate changes on the Company’s estimated net interest income over the twelve-month periods indicated:

	Estimated Exposure to Net Interest Income over Twelve-Month Horizon Beginning
	June 30, 2014				December 31, 2013
Gradual Change in Interest Rate Levels	Dollar Change		Percent Change		Dollar Change		Percent Change
	(Dollars in Thousands)
Up 300 basis points	(993	)	-0.53	%	590		0.33	%
Up 200 basis points	(492	)	-0.26	%	414		0.23	%
Up 100 basis points	(144	)	-0.08	%	220		0.12	%
Down 100 basis points	(3,794	)	-2.03	%	(3,648	)	-2.02	%

The estimated impact of a 300 basis points increase in market interest rates on the Company's estimated net interest income over a twelve-month horizon was a negative 0.53% at June 30, 2014 compared to a positive 0.33% at December 31, 2013. The change was due to the modeled slowdown of prepayments on the loans and leases portfolio as well as incremental growth in medium term, fixed rate commercial real estate loans and commercial loans and leases funded with shorter term funding.

The Company also uses interest-rate sensitivity “gap” analysis to provide a more general overview of its interest-rate risk profile. At June 30, 2014, the Company’s one-year cumulative gap was a negative $643.0 million, or 11.51% of total assets, compared with a negative $271.6 million, or 5.1% of total assets at December 31, 2013.

The assumptions used in the Company's interest-rate sensitivity simulation discussed above are inherently uncertain and, as a result, the simulations cannot precisely measure net interest income or precisely predict the impact of changes in interest rates. For additional discussion on interest-rate risk see Item 7A, “Quantitative and Qualitative Disclosures about Market Risk” on pages 72 to 75 of the Company’s 2013 Annual Report on Form 10-K.

Economic Value of Equity ("EVE") at Risk Simulation is conducted in tandem with net interest income simulations, to ascertain a longer term view of the Company’s interest-rate risk position by capturing longer-term repricing risk and options risk embedded in the balance sheet. It measures the sensitivity of the economic value of equity to changes in interest rates. The EVE at Risk Simulation values only the current balance sheet and does not incorporate growth assumptions. As with the net interest income simulation, this simulation captures product characteristics such as loan resets, repricing terms, maturity dates, and rate caps and floors. Key assumptions include loan prepayment speeds, deposit pricing elasticity and non-maturity deposit attrition rates. These assumptions can have significant impacts on valuation results as the assumptions remain in effect for the entire life of each asset and liability. The Company conducts non-maturity deposit behavior studies on a periodic basis to support deposit assumptions used in the valuation process. All key assumptions are subject to a periodic review.

86

EVE at Risk is calculated by estimating the net present value of all future cash flows from existing assets and liabilities using current interest rates as well as parallel shocks to the current interest-rate environment. The following table sets forth the estimated percentage change in the Company’s EVE at Risk, assuming various shifts in interest rates. Given the interest rate environment at June 30, 2014, simulations for interest rate declines of more than 100 basis points were not deemed to be meaningful.

	Estimated Percent Change in EVE at Risk
Parallel Shock in Interest Rate Levels	At June 30, 2014		At December 31, 2013
Up 300%	-12.30	%	-3.05	%
Up 200%	-10.95	%	-3.87	%
Up 100%	-7.54	%	-2.06	%
Down 100%	2.35	%	-1.11	%

Item 4. Controls and Procedures

Controls and Procedures

Under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer), the Company has evaluated the effectiveness of its disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer considered that, as of the end of the period covered by this report, the Company’s disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports that the Company files or submits under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to the Company’s management, including its Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

There has been no change in the Company’s internal control over financial reporting identified in connection with the quarterly evaluation that occurred during the Company’s last fiscal quarter that has materially and detrimentally affected, or is reasonably likely to materially and detrimentally affect, the Company’s internal controls over financial reporting.

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Exchange Act Rule 13a -15(f). The Company’s internal control system was designed to provide reasonable assurance to its management and the Board of Directors regarding the preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. The Company’s management assessed the effectiveness of its internal control over financial reporting as of the end of the period covered by this report.

Management’s Report on Internal Control Over Financial Reporting as of December 31, 2013 and the related Report of Independent Registered Public Accounting Firm thereon appear on pages F-1 and F-2 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.

87

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

There are no material pending legal proceedings other than those that arise in the normal course. In the opinion of management, after consulting with legal counsel, the consolidated financial position and results of operations of the Company are not expected to be affected materially by the outcome of such proceedings. 

Item 1A. Risk Factors

There has been no material changes to the risk factors disclosed in Item 1A of the Company’s Form 10-K for the year ended December 31, 2013.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

a)        Not applicable.

b)        Not applicable.

c)         None.

Item 3. Defaults Upon Senior Securities

a)        None.

b)        None.

Item 4. Mine Safety Disclosures

Not applicable. 

Item 5. Other Information

None.

Item 6. Exhibits

Exhibits

Exhibit 10.1	Brookline Bancorp, Inc. 2014 Equity Incentive Plan (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed on May 9, 2014)
Exhibit 31.1*	Certification of Chief Executive Officer
Exhibit 31.2*	Certification of Chief Financial Officer
Exhibit 32.1**	Section 1350 Certification of Chief Executive Officer
Exhibit 32.2**	Section 1350 Certification of Chief Financial Officer
Exhibit 101***	The following materials from Brookline Bancorp, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014, formatted in XBRL (eXtensible Business Reporting Language): (i) Unaudited Consolidated Balance Sheets as of June 30, 2014 and December 31, 2013; (ii) Unaudited Consolidated Statements of Income for the three months and six months ended June 30, 2014 and 2013; (iii) Unaudited Consolidated Statements of Comprehensive Income for the three months and six months ended June 30, 2014 and 2013; (iv) Unaudited Consolidated Statements of Changes in Equity for the six months ended June 30, 2014 and 2013; (v) Unaudited Consolidated Statements of Cash Flows for the six months ended June 30, 2014 and 2013; and (vi) Notes to Unaudited Consolidated Financial Statements at and for the six months ended June 30, 2014 and 2013.

*	Filed herewith.
**	Furnished herewith.
***	Pursuant to Rule 406T of Regulation S-T, the XBRL related information in Exhibit 101 to this Quarterly Report on Form 10-Q is furnished and not filed for purposes of Sections 11 and 12 of the Securities Act of 1933, as amended, and Section 18 of the Securities Exchange Act of 1934, as amended.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	BROOKLINE BANCORP, INC.
Date: August 8, 2014	By:	/s/ Paul A. Perrault
		Paul A. Perrault
		President and Chief Executive Officer
		(Principal Executive Officer)
Date: August 8, 2014	By:	/s/ Carl M. Carlson
		Carl M. Carlson
		Chief Financial Officer and Treasurer
		(Principal Financial Officer)

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Paul A. Perrault, President and Chief Executive Officer, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Brookline Bancorp, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

August 8, 2014	/s/ Paul A. Perrault
Date	Paul A. Perrault
	President and Chief Executive Officer
	(Principal Executive Officer)

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Carl M. Carlson, Chief Financial Officer and Treasurer, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Brookline Bancorp, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

August 8, 2014	/s/ Carl M. Carlson
Date	Carl M. Carlson
	Chief Financial Officer and Treasurer
	(Principal Financial Officer)

EX-32.1

Exhibit 32.1

STATEMENT FURNISHED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT

OF 2002, 18 U.S.C. SECTION 1350

The undersigned, Paul A. Perrault, is the President and Chief Executive Officer of Brookline Bancorp, Inc. (the “Company”).

This statement is being furnished in connection with the filing by the Company of the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014 (the “Report”).

By execution of this statement, I certify that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a) or 78o(d)); and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods covered by the Report.

This statement is authorized to be attached as an exhibit to the Report so that this statement will accompany the Report at such time as the Report is filed with the Securities and Exchange Commission pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350. It is not intended that this statement be deemed to be filed for purposes of the Securities Exchange Act of 1934, as amended.

August 8, 2014	/s/ Paul A. Perrault
Date	Paul A. Perrault
	President and Chief Executive Officer
	(Principal Executive Officer)

EX-32.2

Exhibit 32.2

STATEMENT FURNISHED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT

OF 2002, 18 U.S.C. SECTION 1350

The undersigned, Carl M. Carlson, is the Chief Accounting Officer of Brookline Bancorp, Inc. (the “Company”).

This statement is being furnished in connection with the filing by the Company of the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014 (the “Report”).

By execution of this statement, I certify that:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a) or 78o(d)); and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods covered by the Report.

This statement is authorized to be attached as an exhibit to the Report so that this statement will accompany the Report at such time as the Report is filed with the Securities and Exchange Commission pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350. It is not intended that this statement be deemed to be filed for purposes of the Securities Exchange Act of 1934, as amended.

August 8, 2014	/s/ Carl M. Carlson
Date	Carl M. Carlson
	Chief Financial Officer and Treasurer
	(Principal Financial Officer)

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Loans and Leases (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2014	Dec. 31, 2013
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	$ 3,856,807	$ 3,547,053
Originated, Weighted Average Coupon (as a percent)	4.49%	4.59%
Acquired loans	747,106	815,412
Acquired, Weighted Average Coupon (as a percent)	4.29%	4.38%
Total	4,603,913	4,362,465
Weighted Average Coupon (as a percent)	4.45%	4.55%
Percentage of loans to aggregate outstanding amount in the greater New York/New Jersey metropolitan area	36.90%
Percentage of loans to aggregate outstanding amount in Other areas of the United States	63.10%
Commercial real estate loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	1,917,795	1,769,232
Originated, Weighted Average Coupon (as a percent)	4.21%	4.26%
Acquired loans	396,790	434,391
Acquired, Weighted Average Coupon (as a percent)	4.41%	4.46%
Total	2,314,585	2,203,623
Weighted Average Coupon (as a percent)	4.25%	4.30%
Commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	1,229,783	1,111,750
Originated, Weighted Average Coupon (as a percent)	4.29%	4.34%
Acquired loans	315,700	350,235
Acquired, Weighted Average Coupon (as a percent)	4.38%	4.42%
Total	1,545,483	1,461,985
Weighted Average Coupon (as a percent)	4.31%	4.36%
Multi-family mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	562,072	554,555
Originated, Weighted Average Coupon (as a percent)	4.12%	4.19%
Acquired loans	69,299	73,378
Acquired, Weighted Average Coupon (as a percent)	4.54%	4.63%
Total	631,371	627,933
Weighted Average Coupon (as a percent)	4.17%	4.24%
Construction loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	125,940	102,927
Originated, Weighted Average Coupon (as a percent)	3.87%	3.81%
Acquired loans	11,791	10,778
Acquired, Weighted Average Coupon (as a percent)	4.43%	4.37%
Total	137,731	113,705
Weighted Average Coupon (as a percent)	3.92%	3.87%
Commercial loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	950,682	827,808
Originated, Weighted Average Coupon (as a percent)	5.58%	5.77%
Acquired loans	126,271	137,802
Acquired, Weighted Average Coupon (as a percent)	4.67%	4.95%
Total	1,076,953	965,610
Weighted Average Coupon (as a percent)	5.48%	5.65%
Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	370,813	297,684
Originated, Weighted Average Coupon (as a percent)	3.70%	3.68%
Acquired loans	108,043	110,108
Acquired, Weighted Average Coupon (as a percent)	4.39%	4.54%
Total	478,856	407,792
Weighted Average Coupon (as a percent)	3.86%	3.91%
Equipment financing
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	534,261	485,330
Originated, Weighted Average Coupon (as a percent)	6.97%	7.14%
Acquired loans	18,228	27,694
Acquired, Weighted Average Coupon (as a percent)	6.35%	6.60%
Total	552,489	513,024
Weighted Average Coupon (as a percent)	6.95%	7.11%
Condominium association
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	45,608	44,794
Originated, Weighted Average Coupon (as a percent)	4.68%	4.74%
Acquired loans	0	0
Acquired, Weighted Average Coupon (as a percent)	0.00%	0.00%
Total	45,608	44,794
Weighted Average Coupon (as a percent)	4.68%	4.74%
Indirect automobile
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	376,314	400,531
Originated, Weighted Average Coupon (as a percent)	4.62%	4.98%
Acquired loans	0	0
Acquired, Weighted Average Coupon (as a percent)	0.00%	0.00%
Total	376,314	400,531
Weighted Average Coupon (as a percent)	4.62%	4.98%
Consumer loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	612,016	549,482
Originated, Weighted Average Coupon (as a percent)	3.58%	3.61%
Acquired loans	224,045	243,219
Acquired, Weighted Average Coupon (as a percent)	3.90%	3.98%
Total	836,061	792,701
Weighted Average Coupon (as a percent)	3.67%	3.72%
Residential mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	442,551	411,554
Originated, Weighted Average Coupon (as a percent)	3.62%	3.65%
Acquired loans	108,263	116,631
Acquired, Weighted Average Coupon (as a percent)	3.86%	3.93%
Total	550,814	528,185
Weighted Average Coupon (as a percent)	3.67%	3.71%
Home equity
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	155,122	132,396
Originated, Weighted Average Coupon (as a percent)	3.39%	3.39%
Acquired loans	115,081	125,065
Acquired, Weighted Average Coupon (as a percent)	3.86%	3.88%
Total	270,203	257,461
Weighted Average Coupon (as a percent)	3.59%	3.63%
Other consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Originated loans	14,343	5,532
Originated, Weighted Average Coupon (as a percent)	4.51%	5.98%
Acquired loans	701	1,523
Acquired, Weighted Average Coupon (as a percent)	14.87%	14.89%
Total	$ 15,044	$ 7,055
Weighted Average Coupon (as a percent)	5.00%	7.90%

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Derivatives and Hedging Activities (Details) (USD $)	3 Months Ended				6 Months Ended
	Jun. 30, 2014		Jun. 30, 2013		Jun. 30, 2014		Jun. 30, 2013		Dec. 31, 2013
Asset Derivatives
Total derivatives (interest-rate products) not designated as hedging instruments	$ 887,000				$ 887,000				$ 825,000
Liability Derivatives
Total derivatives (interest -rate products) not designed as hedging instruments	912,000				912,000				856,000
Gain (Loss) Recognized in Income on Derivatives
Estimated net credit risk exposure	25,300				25,300				31,200
Derivatives not designated as hedging instruments | Interest-rate products
Asset Derivatives
Total derivatives (interest-rate products) not designated as hedging instruments	887,000				887,000				825,000
Liability Derivatives
Total derivatives (interest -rate products) not designed as hedging instruments	912,000				912,000				856,000
Gain (Loss) Recognized in Income on Derivatives
Gain (Loss) Recognized in Income on Derivatives	4,000	[1]	(22,000)	[1]	6,000	[1]	(25,000)	[1]
Derivatives not designated as hedging instruments | Interest-rate swaps
Derivatives and Hedging Activities
Number of interest-rate swaps	10				10				8
Notional amount of interest-rate swaps	$ 28,000,000				$ 28,000,000				$ 22,400,000

[1] The amount of gain (loss) recognized in income on derivatives represents changes related to the fair value of the interest rate products.

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Allowance for Loan and Lease Losses (Details 6) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014 loan	Jun. 30, 2013 loan	Jun. 30, 2014 loan	Jun. 30, 2013 loan
Troubled Debt Restructured Loans and Leases
Number of loans	6	3	9	11
Recorded Investment, At modification	$ 1,223,000	$ 912,000	$ 3,058,000	$ 3,003,000
Recorded Investment, At end of period	1,206,000	919,000	3,027,000	1,922,000
Specific Allowance for Loan and Lease Losses	26,000	12,000	26,000	42,000
Nonaccrual Loans and Leases/Recorded Investment	278,000	793,000	773,000	793,000
Total loans with one modification	626,000	919,000	1,504,000	1,922,000
Total loans with more than one modification	580,000	0	1,524,000	0
Financial impact of modification of performing and nonperforming loans	100,000	300,000	100,000	300,000
Commitments to lend funds to debtors owing receivables whose terms had been modified in troubled debt restructurings			0
Originated
Troubled Debt Restructured Loans and Leases
Number of loans	4	2	7	10
Recorded Investment, At modification	970,000	488,000	2,805,000	2,579,000
Recorded Investment, At end of period	945,000	498,000	2,766,000	1,501,000
Specific Allowance for Loan and Lease Losses	17,000	12,000	17,000	42,000
Nonaccrual Loans and Leases/Recorded Investment	17,000	372,000	512,000	372,000
Acquired
Troubled Debt Restructured Loans and Leases
Number of loans	2	1	2	1
Recorded Investment, At modification	253,000	424,000	253,000	424,000
Recorded Investment, At end of period	261,000	421,000	261,000	421,000
Specific Allowance for Loan and Lease Losses	9,000	0	9,000	0
Nonaccrual Loans and Leases/Recorded Investment	261,000	421,000	261,000	421,000
Extended maturity
Troubled Debt Restructured Loans and Leases
Total loans with one modification	609,000	0	609,000	0
Total loans with more than one modification	289,000	0	1,233,000	0
Adjusted principal
Troubled Debt Restructured Loans and Leases
Total loans with one modification	0	0	0	372,000
Adjusted interest rate
Troubled Debt Restructured Loans and Leases
Total loans with one modification	0	793,000	878,000	793,000
Interest only
Troubled Debt Restructured Loans and Leases
Total loans with one modification	17,000	0	17,000	0
Total loans with more than one modification	291,000	0	291,000	0
Combination of maturity, principal, interest rate
Troubled Debt Restructured Loans and Leases
Total loans with one modification	0	126,000	0	757,000
Defaulted
Troubled Debt Restructured Loans and Leases
Number of loans	1	4	3	0
Nonaccrual Loans and Leases/Recorded Investment	259,000	2,390,000	349,000	0
Defaulted | Originated
Troubled Debt Restructured Loans and Leases
Number of loans	1	4	3	0
Nonaccrual Loans and Leases/Recorded Investment	259,000	2,390,000	349,000	0
Defaulted | Acquired
Troubled Debt Restructured Loans and Leases
Number of loans	0	0	0	0
Nonaccrual Loans and Leases/Recorded Investment	0	0	0	0
Commercial real estate mortgage | Originated
Troubled Debt Restructured Loans and Leases
Number of loans			1	1
Recorded Investment, At modification			953,000	1,039,000
Recorded Investment, At end of period			944,000	0
Specific Allowance for Loan and Lease Losses			0	0
Nonaccrual Loans and Leases/Recorded Investment			0	0
Commercial real estate mortgage | Defaulted | Originated
Troubled Debt Restructured Loans and Leases
Number of loans			0	0
Nonaccrual Loans and Leases/Recorded Investment			0	0
Commercial | Originated
Troubled Debt Restructured Loans and Leases
Number of loans	2	0	2
Recorded Investment, At modification	390,000	0	390,000
Recorded Investment, At end of period	365,000	0	365,000
Specific Allowance for Loan and Lease Losses	17,000	0	17,000
Nonaccrual Loans and Leases/Recorded Investment	17,000	0	17,000
Commercial | Acquired
Troubled Debt Restructured Loans and Leases
Number of loans	2	1	2	1
Recorded Investment, At modification	253,000	424,000	253,000	424,000
Recorded Investment, At end of period	261,000	421,000	261,000	421,000
Specific Allowance for Loan and Lease Losses	9,000	0	9,000	0
Nonaccrual Loans and Leases/Recorded Investment	261,000	421,000	261,000	421,000
Commercial | Defaulted | Originated
Troubled Debt Restructured Loans and Leases
Number of loans	0	2	0
Nonaccrual Loans and Leases/Recorded Investment	0	1,714,000	0
Commercial | Defaulted | Acquired
Troubled Debt Restructured Loans and Leases
Number of loans	0	0	0	0
Nonaccrual Loans and Leases/Recorded Investment	0	0	0	0
Equipment financing | Originated
Troubled Debt Restructured Loans and Leases
Number of loans	1	2	2	8
Recorded Investment, At modification	289,000	488,000	673,000	1,125,000
Recorded Investment, At end of period	289,000	498,000	671,000	1,129,000
Specific Allowance for Loan and Lease Losses	0	12,000	0	42,000
Nonaccrual Loans and Leases/Recorded Investment	0	372,000	0	372,000
Equipment financing | Defaulted | Originated
Troubled Debt Restructured Loans and Leases
Number of loans	1	1	3	0
Nonaccrual Loans and Leases/Recorded Investment	259,000	303,000	349,000	0
Residential mortgage | Originated
Troubled Debt Restructured Loans and Leases
Number of loans	1	0	2	1
Recorded Investment, At modification	291,000	0	789,000	415,000
Recorded Investment, At end of period	291,000	0	786,000	372,000
Specific Allowance for Loan and Lease Losses	0	0	0	0
Nonaccrual Loans and Leases/Recorded Investment	0	0	495,000	0
Residential mortgage | Defaulted | Originated
Troubled Debt Restructured Loans and Leases
Number of loans	0	1	0	0
Nonaccrual Loans and Leases/Recorded Investment	$ 0	$ 373,000	$ 0	$ 0

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Derivatives and Hedging Activities (Details 2) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Derivatives
Gross Amounts of Recognized Assets	$ 887	$ 825
Net Amounts Of Assets Presented in the Statement of Financial Position	887	825
Gross Amounts Not Offset in the Statement of Financial Position
Net Amount	887	825
Derivatives
Gross Amounts of Recognized Liabilities	912	856
Net Amounts Of Liabilities Presented in the Statement of Financial Position	912	856
Gross Amounts Not Offset in the Statement of Financial Position
Cash Collateral Received	2,770	2,811
Net Amount	$ 3,682	$ 3,667

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Allowance for Loan and Lease Losses (Details 4)	Jun. 30, 2014 class
Commercial real estate loans
Allowance for loan losses and recorded investment in loans
Number of loan classes within specific portfolio	3
Commercial real estate
Allowance for loan losses and recorded investment in loans
Percentage of loans to aggregate outstanding amount	33.60%
Multi-family mortgage
Allowance for loan losses and recorded investment in loans
Percentage of loans to aggregate outstanding amount	13.70%
Construction loans
Allowance for loan losses and recorded investment in loans
Percentage of loans to aggregate outstanding amount	3.00%
Commercial loans
Allowance for loan losses and recorded investment in loans
Number of loan classes within specific portfolio	3
Commercial
Allowance for loan losses and recorded investment in loans
Percentage of loans to aggregate outstanding amount	10.40%
Equipment financing
Allowance for loan losses and recorded investment in loans
Percentage of loans to aggregate outstanding amount	12.00%
Condominium association
Allowance for loan losses and recorded investment in loans
Percentage of loans to aggregate outstanding amount	1.00%
Indirect automobile
Allowance for loan losses and recorded investment in loans
Percentage of loans to aggregate outstanding amount	8.20%
Consumer loans
Allowance for loan losses and recorded investment in loans
Number of loan classes within specific portfolio	3
Minimum loan-to-value ratio needed for loans to be made	80.00%
Residential
Allowance for loan losses and recorded investment in loans
Percentage of loans to aggregate outstanding amount	11.90%
Home equity
Allowance for loan losses and recorded investment in loans
Percentage of loans to aggregate outstanding amount	5.90%
Other consumer
Allowance for loan losses and recorded investment in loans
Percentage of loans to aggregate outstanding amount	0.30%

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Investment Securities (Details) (USD $)	Jun. 30, 2014	Dec. 31, 2013
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 534,391,000	$ 505,889,000
Gross Unrealized Gains	3,404,000	2,680,000
Gross Unrealized Losses	9,209,000	16,141,000
Estimated Fair Value	528,586,000	492,428,000
Investment securities held-to-maturity
Amortized Cost	500,000	500,000
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Estimated Fair Value	500,000	500,000
Estimated fair value	528,586,000	492,428,000
Net unrealized (losses)	(5,800,000)	(13,500,000)
Gross unrealized losses, fair value	344,463,000	383,263,000
Percentage of securities in unrealized loss positions	65.20%	77.80%
Available for sale securities pledged as collateral	392,900,000	402,500,000
Debt securities
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	533,127,000	504,630,000
Gross Unrealized Gains	3,308,000	2,619,000
Gross Unrealized Losses	9,208,000	16,131,000
Estimated Fair Value	527,227,000	491,118,000
Investment securities held-to-maturity
Estimated fair value	527,227,000	491,118,000
Gross unrealized losses, fair value	343,952,000	382,762,000
GSEs
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	15,968,000	12,138,000
Gross Unrealized Gains	21,000	42,000
Gross Unrealized Losses	11,000	0
Estimated Fair Value	15,978,000	12,180,000
Investment securities held-to-maturity
Estimated fair value	15,978,000	12,180,000
Gross unrealized losses, fair value	1,963,000
GSE CMOs
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	254,863,000	254,331,000
Gross Unrealized Gains	146,000	86,000
Gross Unrealized Losses	7,462,000	10,773,000
Estimated Fair Value	247,547,000	243,644,000
Investment securities held-to-maturity
Estimated fair value	247,547,000	243,644,000
GSE MBSs
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	220,848,000	202,478,000
Gross Unrealized Gains	2,559,000	1,852,000
Gross Unrealized Losses	1,560,000	4,929,000
Estimated Fair Value	221,847,000	199,401,000
Investment securities held-to-maturity
Estimated fair value	221,847,000	199,401,000
Private-label CMOs
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost		3,258,000
Gross Unrealized Gains		115,000
Gross Unrealized Losses		18,000
Estimated Fair Value		3,355,000
Investment securities held-to-maturity
Estimated fair value		3,355,000
Gross unrealized losses, fair value		639,000
SBA commercial loan asset-backed securities
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	227,000	245,000
Gross Unrealized Gains	0	0
Gross Unrealized Losses	1,000	2,000
Estimated Fair Value	226,000	243,000
Investment securities held-to-maturity
Estimated fair value	226,000	243,000
Gross unrealized losses, fair value	207,000	224,000
Auction-rate municipal obligations
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost		1,900,000
Gross Unrealized Gains		0
Gross Unrealized Losses		125,000
Estimated Fair Value		1,775,000
Investment securities held-to-maturity
Estimated fair value		1,775,000
Gross unrealized losses, fair value		1,775,000
Municipal obligations
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost		1,068,000
Gross Unrealized Gains		18,000
Gross Unrealized Losses		0
Estimated Fair Value		1,086,000
Investment securities held-to-maturity
Estimated fair value		1,086,000
Corporate debt obligations
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	39,759,000	27,751,000
Gross Unrealized Gains	582,000	506,000
Gross Unrealized Losses	11,000	33,000
Estimated Fair Value	40,330,000	28,224,000
Investment securities held-to-maturity
Estimated fair value	40,330,000	28,224,000
Gross unrealized losses, fair value	4,067,000	5,988,000
Trust preferred securities and pools
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	1,462,000	1,461,000
Gross Unrealized Gains	0	0
Gross Unrealized Losses	163,000	251,000
Estimated Fair Value	1,299,000	1,210,000
Investment securities held-to-maturity
Estimated fair value	1,299,000	1,210,000
Gross unrealized losses, fair value	1,299,000	1,210,000
Marketable equity securities
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	1,264,000	1,259,000
Gross Unrealized Gains	96,000	61,000
Gross Unrealized Losses	1,000	10,000
Estimated Fair Value	1,359,000	1,310,000
Investment securities held-to-maturity
Estimated fair value	1,359,000	1,310,000
Gross unrealized losses, fair value	$ 511,000	$ 501,000

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Earnings per Share (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Basic EPS Computation, Numerator:
Net income	$ 9,976	$ 9,490	$ 20,398	$ 18,304
Basic EPS Computation, Denominator:
Weighted average shares outstanding	69,886,576	69,774,703	69,881,055	69,768,777
Basic EPS (in dollars per share)	$ 0.14	$ 0.14	$ 0.29	$ 0.26
Diluted EPS Computation, Numerator:
Net income	$ 9,976	$ 9,490	$ 20,398	$ 18,304
Diluted EPS Computation, Denominator:
Weighted average shares outstanding	69,886,576	69,774,703	69,881,055	69,768,777
Effect of dilutive securities (in shares)	125,801	58,838	117,164	54,838
Adjusted weighted average shares outstanding	70,012,377	69,833,541	69,998,219	69,823,615
Diluted EPS (in dollars per share)	$ 0.14	$ 0.14	$ 0.29	$ 0.26

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Allowance for Loan and Lease Losses (Tables)

6 Months Ended

Jun. 30, 2014

Receivables [Abstract]

Schedule of changes in the allowance for loan and lease losses and the recorded investment in loans and leases by portfolio segment

The following tables present the changes in the allowance for loan and lease losses and the recorded investment in loans and leases by portfolio segment for the periods indicated:

	Three Months Ended June 30, 2014
	Commercial Real Estate		Commercial			Indirect Automobile			Consumer			Unallocated			Total
	(In Thousands)
Balance at March 31, 2014	$	24,858	$	15,544		$	3,664		$	3,110		$	3,048		$	50,224
Charge-offs	—		(796		)	(228		)	(172		)	—			(1,196		)
Recoveries	—		218			173			85			—			476
Provision (credit) for loan and lease losses	1,857		900			77			(6		)	(646		)	2,182
Balance at June 30, 2014	$	26,715	$	15,866		$	3,686		$	3,017		$	2,402		$	51,686

	Three Months Ended June 30, 2013
	Commercial Real Estate			Commercial			Indirect Automobile			Consumer			Unallocated		Total
	(In Thousands)
Balance at March 31, 2013	$	20,588		$	11,652		$	5,000		$	2,596		$	2,696	$	42,532
Charge-offs	(81		)	(477		)	(318		)	(154		)	—		(1,030		)
Recoveries	—			182			149			60			—		391
Provision (credit) for loan and lease losses	1,512			434			(136		)	497			81		2,388
Balance at June 30, 2013	$	22,019		$	11,791		$	4,695		$	2,999		$	2,777	$	44,281

	Six Months Ended June 30, 2014
	Commercial Real Estate		Commercial			Indirect Automobile			Consumer			Unallocated			Total
	(In Thousands)
Balance at December 31, 2013	$	23,022	$	15,220		$	3,924		$	3,375		$	2,932		$	48,473
Charge-offs	—		(1,347		)	(517		)	(382		)	—			(2,246		)
Recoveries	—		469			277			114			—			860
Provision (credit) for loan and lease losses	3,693		1,524			2			(90		)	(530		)	4,599
Balance at June 30, 2014	$	26,715	$	15,866		$	3,686		$	3,017		$	2,402		$	51,686

	Six Months Ended June 30, 2013
	Commercial Real Estate			Commercial			Indirect Automobile			Consumer			Unallocated		Total
	(In Thousands)
Balance at December 31, 2012	$	20,018		$	10,655		$	5,304		$	2,545		$	2,630	$	41,152
Charge-offs	(81		)	(724		)	(680		)	(206		)	—		(1,691		)
Recoveries	4			264			279			86			—		633
Provision (credit) for loan and lease losses	2,078			1,596			(208		)	574			147		4,187
Balance at June 30, 2013	$	22,019		$	11,791		$	4,695		$	2,999		$	2,777	$	44,281

Schedule of provisions for credit losses

The provisions for credit losses are set forth below for the periods indicated:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands)
Provision (credit) for loan and lease losses:
Commercial real estate	$	1,857		$	1,512		$	3,693		$	2,078
Commercial	900			434			1,524			1,596
Indirect automobile	77			(136		)	2			(208		)
Consumer	(6		)	497			(90		)	574
Unallocated	(646		)	81			(530		)	147
Total provision for loan and lease losses	2,182			2,388			4,599			4,187
Unfunded credit commitments	94			51			120			107
Total provision for credit losses	$	2,276		$	2,439		$	4,719		$	4,294

Summary of the recorded investments in loans in each class (unpaid balance of loans and leases outstanding excluding deferred loan origination costs) by credit quality indicator

The following tables present the recorded investment in loans in each class at June 30, 2014 by credit quality indicator.

	At June 30, 2014
	Commercial Real Estate Mortgage		Multi- Family Mortgage		Construction		Commercial		Equipment Financing		Condominium Association		Other Consumer
	(In Thousands)
Originated:
Loan rating:
Pass	$	1,220,046	$	561,705	$	125,940	$	359,654	$	529,588	$	45,608	$	14,332
OAEM	8,685		367		—		8,853		1,082		—		—
Substandard	1,052		—		—		1,011		3,002		—		11
Doubtful	—		—		—		1,295		589		—		—
Total originated	1,229,783		562,072		125,940		370,813		534,261		45,608		14,343
Acquired:
Loan rating:
Pass	301,358		63,085		11,523		96,171		18,123		—		689
OAEM	4,569		2,553		268		2,468		33		—		—
Substandard	9,727		3,661		—		9,256		72		—		12
Doubtful	46		—		—		148		—		—		—
Total acquired	315,700		69,299		11,791		108,043		18,228		—		701
Total loans	$	1,545,483	$	631,371	$	137,731	$	478,856	$	552,489	$	45,608	$	15,044

At June 30, 2014, there were no loans categorized as definite loss.

	At June 30, 2014
	Indirect Automobile
	(In Thousands)		(Percent)
Originated:
Credit score:
Over 700	$	312,755	83.1	%
661-700	50,960		13.6	%
660 and below	11,083		2.9	%
Data not available	1,516		0.4	%
Total loans	$	376,314	100.0	%

	At June 30, 2014
	Residential Mortgage				Home Equity
	(In Thousands)		(Percent)		(In Thousands)		(Percent)
Originated:
Loan-to-value ratio:
Less than 50%	$	104,052	18.9	%	$	92,667	34.3	%
50% - 69%	155,284		28.2	%	33,727		12.5	%
70% - 79%	150,649		27.3	%	23,972		8.9	%
80% and over	29,114		5.3	%	3,823		1.4	%
Data not available	3,452		0.6	%	933		0.3	%
Total originated	442,551		80.3	%	155,122		57.4	%
Acquired:
Loan-to-value ratio:
Less than 50%	20,075		3.7	%	76,631		28.4	%
50% - 69%	37,392		6.8	%	24,276		9.0	%
70% - 79%	27,166		4.9	%	11,973		4.4	%
80% and over	19,167		3.5	%	1,483		0.5	%
Data not available	4,463		0.8	%	718		0.3	%
Total acquired	108,263		19.7	%	115,081		42.6	%
Total loans	$	550,814	100.0	%	$	270,203	100.0	%

The following tables present the recorded investment in loans in each class at December 31, 2013 by credit quality indicator.

	At December 31, 2013
	Commercial Real Estate Mortgage		Multi- Family Mortgage		Construction		Commercial		Equipment Financing		Condominium Association		Other Consumer
	(In Thousands)
Originated:
Loan rating:
Pass	$	1,099,108	$	554,183	$	102,927	$	295,057	$	479,811	$	44,793	$	5,528
OAEM	11,555		372		—		49		625		—		—
Substandard	1,087		—		—		1,078		4,817		1		4
Doubtful	—		—		—		1,500		77		—		—
Total originated	1,111,750		554,555		102,927		297,684		485,330		44,794		5,532
Acquired:
Loan rating:
Pass	332,145		69,310		10,090		96,779		27,535		—		1,509
OAEM	7,556		463		688		4,617		61		—		—
Substandard	8,645		3,605		—		8,518		98		—		14
Doubtful	1,889		—		—		194		—		—		—
Total acquired	350,235		73,378		10,778		110,108		27,694		—		1,523
Total loans	$	1,461,985	$	627,933	$	113,705	$	407,792	$	513,024	$	44,794	$	7,055

At December 31, 2013, there were no loans categorized as definite loss.

	At December 31, 2013
	Indirect Automobile
	(In Thousands)		(Percent)
Originated:
Credit score:
Over 700	$	332,140	82.9	%
661-700	54,038		13.5	%
660 and below	12,793		3.2	%
Data not available	1,560		0.4	%
Total loans	$	400,531	100.0	%

	At December 31, 2013
	Residential Mortgage				Home Equity
	(In Thousands)		(Percent)		(In Thousands)		(Percent)
Originated:
Loan-to-value ratio:
Less than 50%	$	94,500	17.9	%	$	75,372	29.3	%
50% - 69%	149,969		28.4	%	31,504		12.2	%
70% - 79%	139,960		26.5	%	21,161		8.2	%
80% and over	22,772		4.3	%	3,240		1.3	%
Data not available	4,353		0.8	%	1,119		0.4	%
Total originated	411,554		77.9	%	132,396		51.4	%
Acquired:
Loan-to-value ratio:
Less than 50%	23,101		4.4	%	84,272		32.7	%
50% - 69%	39,298		7.4	%	25,964		10.1	%
70% - 79%	31,932		6.0	%	13,390		5.2	%
80% and over	19,870		3.8	%	1,208		0.5	%
Data not available	2,430		0.5	%	231		0.1	%
Total acquired	116,631		22.1	%	125,065		48.6	%
Total loans	$	528,185	100.0	%	$	257,461	100.0	%

Schedule of information regarding the aging of past due loans, by loans and leases class

The following tables present an age analysis of the recorded investment in total loans and leases at June 30, 2014 and December 31, 2013.

	At June 30, 2014
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Originated:
Commercial real estate loans:
Commercial real estate mortgage	$	—	$	888	$	164	$	1,052	$	1,228,731	$	1,229,783	$	—	$	1,052
Multi-family mortgage	—		—		71		71		562,001		562,072		71		—
Construction	—		—		—		—		125,940		125,940		—		—
Total commercial real estate loans	—		888		235		1,123		1,916,672		1,917,795		71		1,052
Commercial loans and leases:
Commercial	1,657		355		1,296		3,308		367,505		370,813		—		1,339
Equipment financing	1,199		526		2,098		3,823		530,438		534,261		122		3,251
Condominium association	139		—		—		139		45,469		45,608		—		—
Total commercial loans and leases	2,995		881		3,394		7,270		943,412		950,682		122		4,590
Indirect automobile	4,754		579		19		5,352		370,962		376,314		2		325
Consumer loans:
Residential mortgage	493		—		29		522		442,029		442,551		—		1,393
Home equity	100		21		—		121		155,001		155,122		—		404
Other consumer	13		4		15		32		14,311		14,343		—		15
Total consumer loans	606		25		44		675		611,341		612,016		—		1,812
Total originated loans and leases	$	8,355	$	2,373	$	3,692	$	14,420	$	3,842,387	$	3,856,807	$	195	$	7,779

	At June 30, 2014
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Acquired:
Commercial real estate loans:
Commercial real estate mortgage	$	3,754	$	362	$	2,122	$	6,238	$	309,462	$	315,700	$	1,627	$	1,959
Multi-family mortgage	1,012		—		1,296		2,308		66,991		69,299		1,296		—
Construction	268		—		—		268		11,523		11,791		—		—
Total commercial real estate loans	5,034		362		3,418		8,814		387,976		396,790		2,923		1,959
Commercial loans and leases:
Commercial	383		300		3,315		3,998		104,045		108,043		864		5,044
Equipment financing	—		35		72		107		18,121		18,228		73		—
Total commercial loans and leases	383		335		3,387		4,105		122,166		126,271		937		5,044
Consumer loans:
Residential mortgage	456		53		3,090		3,599		104,664		108,263		2,428		991
Home equity	764		1,049		783		2,596		112,485		115,081		170		1,367
Other consumer	1		10		16		27		674		701		—		21
Total consumer loans	1,221		1,112		3,889		6,222		217,823		224,045		2,598		2,379
Total acquired loans and leases	$	6,638	$	1,809	$	10,694	$	19,141	$	727,965	$	747,106	$	6,458	$	9,382
Total loans and leases	$	14,993	$	4,182	$	14,386	$	33,561	$	4,570,352	$	4,603,913	$	6,653	$	17,161

	At December 31, 2013
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Originated:
Commercial real estate loans:
Commercial real estate mortgage	$	4,896	$	1,393	$	169	$	6,458	$	1,105,292	$	1,111,750	$	—	$	169
Multi-family mortgage	14,400		—		—		14,400		540,155		554,555		—		—
Construction	—		—		—		—		102,927		102,927		—		—
Total commercial real estate loans	19,296		1,393		169		20,858		1,748,374		1,769,232		—		169
Commercial loans and leases:
Commercial	2,288		75		842		3,205		294,479		297,684		—		1,551
Equipment financing	867		1,558		2,031		4,456		480,874		485,330		—		4,086
Condominium association	—		—		—		—		44,794		44,794		—		1
Total commercial loans and leases	3,155		1,633		2,873		7,661		820,147		827,808		—		5,638
Indirect automobile	5,407		857		229		6,493		394,038		400,531		10		259
Consumer loans:
Residential mortgage	201		—		415		616		410,938		411,554		—		1,713
Home equity	218		—		—		218		132,178		132,396		—		462
Other consumer	11		1		4		16		5,516		5,532		—		4
Total consumer loans	430		1		419		850		548,632		549,482		—		2,179
Total originated loans and leases	$	28,288	$	3,884	$	3,690	$	35,862	$	3,511,191	$	3,547,053	$	10	$	8,245

	At December 31, 2013
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Acquired:
Commercial real estate loans:
Commercial real estate mortgage	$	1,221	$	87	$	4,887	$	6,195	$	344,040	$	350,235	$	3,958	$	929
Multi-family mortgage	327		—		1,052		1,379		71,999		73,378		1,052		—
Construction	—		409		—		409		10,369		10,778		—		—
Total commercial real estate loans	1,548		496		5,939		7,983		426,408		434,391		5,010		929
Commercial loans and leases:
Commercial	2,707		121		1,931		4,759		105,349		110,108		1,235		4,597
Equipment financing	46		41		73		160		27,534		27,694		73		29
Total commercial loans and leases	2,753		162		2,004		4,919		132,883		137,802		1,308		4,626
Consumer loans:
Residential mortgage	271		777		5,329		6,377		110,254		116,631		4,468		1,162
Home equity	1,259		552		895		2,706		122,359		125,065		117		1,525
Other consumer	6		11		4		21		1,502		1,523		—		14
Total consumer loans	1,536		1,340		6,228		9,104		234,115		243,219		4,585		2,701
Total acquired loans and leases	$	5,837	$	1,998	$	14,171	$	22,006	$	793,406	$	815,412	$	10,903	$	8,256
Total loan and leases	$	34,125	$	5,882	$	17,861	$	57,868	$	4,304,597	$	4,362,465	$	10,913	$	16,501

Schedule of impaired loans and leases, by loans and leases class

The following tables include the recorded investment and unpaid principal balances of impaired loans and leases with the related allowance amount, if applicable, for the originated and acquired loan and lease portfolios at the dates indicated. Also presented are the average recorded investments in the impaired loans and leases and the related amount of interest recognized during the period that the impaired loans were impaired.

	At June 30, 2014						At December 31, 2013
	Recorded Investment (1)		Unpaid Principal Balance		Related Allowance		Recorded Investment (2)		Unpaid Principal Balance		Related Allowance
	(In Thousands)
Originated:
With no related allowance recorded:
Commercial real estate	$	944	$	944	$	—	$	2,009	$	2,009	$	—
Commercial	5,487		5,507		—		4,410		4,399		—
Consumer	78		78		—		989		987		—
Total originated with no related allowance recorded	6,509		6,529		—		7,408		7,395		—
With an allowance recorded:
Commercial real estate	2,808		2,808		47		1,466		1,466		184
Commercial	3,486		3,457		820		2,393		2,383		675
Consumer	3,571		3,561		—		2,448		2,440		323
Total originated with an allowance recorded	9,865		9,826		867		6,307		6,289		1,182
Total originated impaired loans and leases	16,374		16,355		867		13,715		13,684		1,182
Acquired:
With no related allowance recorded:
Commercial real estate	19,870		20,375		—		9,176		10,082		—
Commercial	6,685		6,786		—		6,988		7,248		—
Consumer	4,817		4,817		—		1,033		1,037		—
Total acquired with no related allowance recorded	31,372		31,978		—		17,197		18,367		—
With an allowance recorded:
Commercial real estate	1,521		1,548		50		1,274		1,291		122
Commercial	1,982		2,143		149		1,020		1,067		169
Consumer	707		707		34		—		—		—
Total acquired with an allowance recorded	4,210		4,398		233		2,294		2,358		291
Total acquired impaired loans and leases	35,582		36,376		233		19,491		20,725		291
Total impaired loans and leases	$	51,956	$	52,731	$	1,100	$	33,206	$	34,409	$	1,473

⁽¹⁾Includes originated and acquired nonaccrual loans of $6.1 million and $8.9 million at June 30, 2014, respectively.

⁽²⁾Includes originated and acquired nonaccrual loans of $5.8 million and $5.7 million at December 31, 2013, respectively.

	Three Months Ended
	June 30, 2014				June 30, 2013
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
	(In Thousands)
Originated:
With no related allowance recorded:
Commercial real estate	$	947	$	12	$	1,939	$	30
Commercial	5,711		62		3,139		29
Consumer	128		—		1,323		18
Total originated with no related allowance recorded	6,786		74		6,401		77
With an allowance recorded:
Commercial real estate	3,010		22		1,256		10
Commercial	3,800		24		1,682		6
Consumer	3,582		15		2,681		35
Total originated with an allowance recorded	10,392		61		5,619		51
Total originated impaired loans and leases	17,178		135		12,020		128
Acquired:
With no related allowance recorded:
Commercial real estate	20,402		182		3,217		88
Commercial	6,775		23		1,548		26
Consumer	4,807		5		317		8
Total acquired with no related allowance recorded	31,984		210		5,082		122
With an allowance recorded:
Commercial real estate	1,522		3		3,679		—
Commercial	1,948		14		—		—
Consumer	770		1		—		—
Total acquired with an allowance recorded	4,240		18		3,679		—
Total acquired impaired loans and leases	36,224		228		8,761		122
Total impaired loans and leases	$	53,402	$	363	$	20,781	$	250

	Six Months Ended
	June 30, 2014				June 30, 2013
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
	(In Thousands)
Originated:
With no related allowance recorded:
Commercial real estate	$	2,422	$	48	$	2,695	$	30
Commercial	4,796		70		4,030		60
Consumer	1,980		13		1,328		18
Total originated with no related allowance recorded	9,198		131		8,053		108
With an allowance recorded:
Commercial real estate	1,587		22		1,469		17
Commercial	3,728		48		1,686		7
Consumer	1,940		15		3,475		39
Total originated with an allowance recorded	7,255		85		6,630		63
Total originated impaired loans and leases	16,453		216		14,683		171
Acquired:
With no related allowance recorded:
Commercial real estate	13,990		228		11,291		99
Commercial	7,498		59		4,369		66
Consumer	6,539		10		1,489		8
Total acquired with no related allowance recorded	28,027		297		17,149		173
With an allowance recorded:
Commercial real estate	2,971		40		3,700		—
Commercial	1,247		15		631		—
Consumer	385		1		—		—
Total acquired with an allowance recorded	4,603		56		4,331		—
Total acquired impaired loans and leases	32,630		353		21,480		173
Total impaired loans and leases	$	49,083	$	569	$	36,163	$	344

Schedule of the impaired and non-impaired loans and leases, by loan and leases class

The following tables present information regarding impaired and non-impaired loans and leases at the dates indicated:

	At June 30, 2014
	Commercial Real Estate			Commercial		Indirect Automobile		Consumer		Unallocated		Total
	(In Thousands)
Allowance for Loan and Lease Losses:
Originated:
Individually evaluated for impairment	$	47		$	820	$	—	$	—	$	—	$	867
Collectively evaluated for impairment	26,152			14,564		3,686		2,768		2,402		49,572
Total originated loans and leases	26,199			15,384		3,686		2,768		2,402		50,439
Acquired:
Individually evaluated for impairment	—			59		—		34		—		93
Collectively evaluated for impairment	(53		)	217		—		2		—		166
Acquired with deteriorated credit quality	569			206		—		213		—		988
Total acquired loans and leases	516			482		—		249		—		1,247
Total allowance for loan and lease losses	$	26,715		$	15,866	$	3,686	$	3,017	$	2,402	$	51,686
Loans and Leases:
Originated:
Individually evaluated for impairment	$	3,753		$	8,974	$	—	$	3,648	$	—	$	16,375
Collectively evaluated for impairment	1,914,042			941,708		376,314		608,368		—		3,840,432
Total originated loans and leases	1,917,795			950,682		376,314		612,016		—		3,856,807
Acquired:
Individually evaluated for impairment	1,355			4,707		—		2,327		—		8,389
Collectively evaluated for impairment	127,603			90,418		—		147,840		—		365,861
Acquired with deteriorated credit quality	267,832			31,146		—		73,878		—		372,856
Total acquired loans and leases	396,790			126,271		—		224,045		—		747,106
Total loans and leases	$	2,314,585		$	1,076,953	$	376,314	$	836,061	$	—	$	4,603,913

	At December 31, 2013
	Commercial Real Estate			Commercial		Indirect Automobile		Consumer		Unallocated		Total
	(In Thousands)
Allowance for Loan and Lease Losses:
Originated:
Individually evaluated for impairment	$	184		$	675	$	—	$	323	$	—	$	1,182
Collectively evaluated for impairment	22,336			14,056		3,924		2,414		2,932		45,662
Total originated loans and leases	22,520			14,731		3,924		2,737		2,932		46,844
Acquired:
Individually evaluated for impairment	—			3		—		—		—		3
Collectively evaluated for impairment	(54		)	234		—		204		—		384
Acquired with deteriorated credit quality	556			252		—		434		—		1,242
Total acquired loans and leases	502			489		—		638		—		1,629
Total allowance for loan and lease losses	$	23,022		$	15,220	$	3,924	$	3,375	$	2,932	$	48,473
Loans and Leases:
Originated:
Individually evaluated for impairment	$	3,643		$	6,634	$	—	$	3,438	$	—	$	13,715
Collectively evaluated for impairment	1,765,589			821,174		400,531		546,044		—		3,533,338
Total originated loans and leases	1,769,232			827,808		400,531		549,482		—		3,547,053
Acquired:
Individually evaluated for impairment	2,625			4,878		—		872		—		8,375
Collectively evaluated for impairment	145,057			93,565		—		162,595		—		401,217
Acquired with deteriorated credit quality	286,709			39,359		—		79,752		—		405,820
Total acquired loans and leases	434,391			137,802		—		243,219		—		815,412
Total loans and leases	$	2,203,623		$	965,610	$	400,531	$	792,701	$	—	$	4,362,465

Summary of investment in troubled debt restructurings, and the associated specific allowances for loan and lease losses

The recorded investment in troubled debt restructurings and the associated specific allowances for loan and lease losses, in the originated and acquired loan and lease portfolios, are as follows for the periods indicated.

	At and for the Three Months Ended June 30, 2014
	Recorded Investment					Specific				Defaulted
	Number of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial	2	$	390	$	365	$	17	$	17	$	—	—	—
Equipment financing	1	289		289		—		—		—		1	259
Residential mortgage	1	291		291		—		—		—		—	—
Total Originated	4	970		945		17		17		—		1	259
Acquired:
Commercial	2	253		261		9		261		—		—	—
Total Acquired	2	253		261		9		261		—		—	—
Total	6	$	1,223	$	1,206	$	26	$	278	$	—	1	$	259

	At and for the Three Months Ended June 30, 2013
	Recorded Investment					Specific				Defaulted
	Number  of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial	—	$	—	$	—	$	—	$	—	$	—	2	$	1,714
Equipment financing	2	488		498		12		372		—		1	303
Residential mortgage	—	—		—		—		—		—		1	373
Total Originated	2	488		498		12		372		—		4	2,390
Acquired:
Commercial	1	424		421		—		421		—		—	—
Total Acquired	1	424		421		—		421		—		—	—
Total	3	$	912	$	919	$	12	$	793	$	—	4	$	2,390

	At and for the Six Months Ended June 30, 2014
	Recorded Investment					Specific				Defaulted
	Number of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial real estate mortgage	1	$	953	$	944	$	—	$	—	$	—	—	$	—
Commercial	2	390		365		17		17		—		—	—
Equipment financing	2	673		671		—		—		—		3	349
Residential mortgage	2	789		786		—		495		—		—	—
Total Originated	7	2,805		2,766		17		512		—		3	349
Acquired:
Commercial	2	253		261		9		261		—		—	—
Total Acquired	2	253		261		9		261		—		—	—
Total	9	$	3,058	$	3,027	$	26	$	773	$	—	3	$	349

	At and for the Six Months Ended June 30, 2013
	Recorded Investment					Specific				Defaulted
	Number of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial real estate mortgage	1	$	1,039	$	—	$	—	$	—	$	—	—	$	—
Equipment financing	8	1,125		1,129		42		372		—		—	—
Residential mortgage	1	415		372		—		—		—		—	—
Total Originated	10	2,579		1,501		42		372		—		—	—
Acquired:
Commercial	1	424		421		—		421		—		—	—
Total Acquired	1	424		421		—		421		—		—	—
Total	11	$	3,003	$	1,922	$	42	$	793	$	—	—	$	—

Schedule of troubled debt restructurings by type of modification

The following table sets forth the Company’s balances of troubled debt restructurings that were modified at the dates indicated, by type of modification.

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In Thousands)
Loans with one modification:
Extended maturity	$	609	$	—	$	609	$	—
Adjusted principal	—		—		—		372
Adjusted interest rate	—		793		878		793
Interest only	17		—		17		—
Combination maturity, principal, interest rate	—		126		—		757
Total loans with one modification	$	626	$	919	$	1,504	$	1,922
Loans with more than one modification:
Extended maturity	$	289	$	—	$	1,233	$	—
Interest only	291		—		291		—
Total loans with more than one modification	$	580	$	—	$	1,524	$	—

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Goodwill and Other Intangible Assets (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Schedule of Goodwill and Intangible Assets [Line Items]
Goodwill	$ 137,890	$ 137,890
Total other intangible assets	15,199	16,887
Total goodwill and intangible assets	153,089	154,777
Trade name
Schedule of Goodwill and Intangible Assets [Line Items]
Total other intangible assets	1,089	1,089
Trust relationship
Schedule of Goodwill and Intangible Assets [Line Items]
Total other intangible assets	0	21
Core deposits
Schedule of Goodwill and Intangible Assets [Line Items]
Total other intangible assets	$ 14,110	$ 15,777

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Loans and Leases (Details 4) (USD $) In Billions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Receivables [Abstract]
Loans and leases pledged as collateral	$ 1.5	$ 1.2

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Investment Securities (Details 5) (USD $)	Jun. 30, 2014	Dec. 31, 2013
Available for Sale, Amortized Cost
Within 1 year	$ 12,343,000	$ 13,012,000
After 1 year through 5 years	52,908,000	40,204,000
After 5 years through 10 years	85,907,000	66,447,000
Over 10 years	381,969,000	384,967,000
Total	533,127,000	504,630,000
Available for Sale, Estimated Fair Value
Within 1 year	12,370,000	13,062,000
After 1 year through 5 years	54,177,000	41,187,000
After 5 years through 10 years	87,009,000	67,075,000
Over 10 years	373,671,000	369,794,000
Total	527,227,000	491,118,000
Available for Sale, Weighted Average Rate
Within 1 year (as a percent)	0.67%	0.82%
After 1 year through 5 years (as a percent)	2.64%	2.90%
After 5 years through 10 years (as a percent)	1.97%	2.23%
Over 10 years (as a percent)	1.91%	1.90%
Total (as a percent)	1.96%	2.00%
Held-to-maturity, Amortized Cost
Within 1 year	0	500,000
After 1 year through 5 years	500,000	0
Total	500,000	500,000
Held-to-maturity, Estimated Fair Value
Within 1 year	0	500,000
After 1 year through 5 years	500,000	0
Total	500,000	500,000
Held-to-maturity, Weighted Average Rate
Within 1 year (as a percent)	0.00%	1.99%
After 1 year through 5 years (as a percent)	1.30%	0.00%
After 5 years through 10 years (as a percent)	0.00%	0.00%
Over 10 years (as a percent)	0.00%	0.00%
Total (as a percent)	1.30%	1.99%
Estimated fair value of debt securities have right to call or prepay the obligations	5,200,000	3,700,000
Estimated fair value of debt securities have right to call or prepay the obligations, scheduled maturities of less than one year		700,000
Estimated fair value of debt securities have right to call or prepay the obligations, schedule maturities of one to five years	2,000,000
Estimated fair value of debt securities have right to call or prepay the obligations, schedule maturities of six to ten years	1,900,000
Estimated fair value of debt securities have right to call or prepay the obligations, scheduled maturities after ten years	$ 1,300,000	$ 3,000,000

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Comprehensive Income/(Loss) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Changes in accumulated other comprehensive (loss) income by component, net of tax
Balance at the beginning of the period	$ (5,936)	$ 2,233	$ (7,915)	$ 3,483
Other comprehensive (loss) income	2,727	(6,674)	4,706	(7,924)
Balance at the end of the period	(3,209)	(4,441)	(3,209)	(4,441)
Investment Securities Available-for-Sale
Changes in accumulated other comprehensive (loss) income by component, net of tax
Balance at the beginning of the period	(6,301)	2,108	(8,332)	3,358
Other comprehensive (loss) income	2,727	(6,680)	4,758	(7,930)
Balance at the end of the period	(3,574)	(4,572)	(3,574)	(4,572)
Postretirement Benefits
Changes in accumulated other comprehensive (loss) income by component, net of tax
Balance at the beginning of the period	365	125	417	125
Other comprehensive (loss) income	0	6	(52)	6
Balance at the end of the period	$ 365	$ 131	$ 365	$ 131

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Fair Value of Financial Instruments (Details 4) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Financial assets:
Securities held-to-maturity	$ 500	$ 500
Loans and leases, net	4,552,227	4,313,992
Financial liabilities:
Borrowed funds	35,360	43,782
Carrying Value
Financial assets:
Securities held-to-maturity	500	500
Loans held-for-sale	13,890	13,372
Loans and leases, net	4,552,227	4,313,992
Financial liabilities:
Certificate of deposit	900,216	934,668
Borrowed funds	1,041,004	812,555
Estimated Fair Value
Financial assets:
Securities held-to-maturity	500	500
Loans held-for-sale	13,890	13,372
Loans and leases, net	4,522,877	4,552,556
Financial liabilities:
Certificate of deposit	903,673	938,703
Borrowed funds	1,045,320	815,910
Level 1
Financial assets:
Securities held-to-maturity	0	0
Loans held-for-sale	0	0
Loans and leases, net	0	0
Financial liabilities:
Certificate of deposit	0	0
Borrowed funds	0	0
Level 2
Financial assets:
Securities held-to-maturity	0	0
Loans held-for-sale	13,890	13,372
Loans and leases, net	0	0
Financial liabilities:
Certificate of deposit	903,673	938,703
Borrowed funds	1,045,320	815,910
Level 3
Financial assets:
Securities held-to-maturity	500	500
Loans held-for-sale	0	0
Loans and leases, net	4,522,877	4,552,556
Financial liabilities:
Certificate of deposit	0	0
Borrowed funds	0	0
Nonrecurring basis | Estimated Fair Value
Summary of carrying values and estimated fair values
Total assets reported at fair value	6,173	13,677
Nonrecurring basis | Level 1
Summary of carrying values and estimated fair values
Total assets reported at fair value	0	0
Nonrecurring basis | Level 2
Summary of carrying values and estimated fair values
Total assets reported at fair value	571	1,001
Nonrecurring basis | Level 3
Summary of carrying values and estimated fair values
Total assets reported at fair value	5,602	12,676
Nonrecurring basis | Collateral-dependent impaired loans and leases | Estimated Fair Value
Summary of carrying values and estimated fair values
Total assets reported at fair value	4,927	12,099
Nonrecurring basis | Collateral-dependent impaired loans and leases | Level 1
Summary of carrying values and estimated fair values
Total assets reported at fair value	0	0
Nonrecurring basis | Collateral-dependent impaired loans and leases | Level 2
Summary of carrying values and estimated fair values
Total assets reported at fair value	0	0
Nonrecurring basis | Collateral-dependent impaired loans and leases | Level 3
Summary of carrying values and estimated fair values
Total assets reported at fair value	4,927	12,099
Nonrecurring basis | Other real estate owned | Estimated Fair Value
Summary of carrying values and estimated fair values
Total assets reported at fair value	675	577
Nonrecurring basis | Other real estate owned | Level 1
Summary of carrying values and estimated fair values
Total assets reported at fair value	0	0
Nonrecurring basis | Other real estate owned | Level 2
Summary of carrying values and estimated fair values
Total assets reported at fair value	0	0
Nonrecurring basis | Other real estate owned | Level 3
Summary of carrying values and estimated fair values
Total assets reported at fair value	675	577
Nonrecurring basis | Repossessed vehicles and equipment | Estimated Fair Value
Summary of carrying values and estimated fair values
Total assets reported at fair value	571	1,001
Nonrecurring basis | Repossessed vehicles and equipment | Level 1
Summary of carrying values and estimated fair values
Total assets reported at fair value	0	0
Nonrecurring basis | Repossessed vehicles and equipment | Level 2
Summary of carrying values and estimated fair values
Total assets reported at fair value	571	1,001
Nonrecurring basis | Repossessed vehicles and equipment | Level 3
Summary of carrying values and estimated fair values
Total assets reported at fair value	$ 0	$ 0

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Allowance for Loan and Lease Losses (Details 5) (USD $)	3 Months Ended			6 Months Ended
	Jun. 30, 2014		Jun. 30, 2013	Jun. 30, 2014		Jun. 30, 2013	Dec. 31, 2013
Impaired Loans and Leases
Recorded investment	$ 51,956,000	[1]		$ 51,956,000	[1]		$ 33,206,000	[2]
Unpaid principal balance	52,731,000			52,731,000			34,409,000
Related allowance	1,100,000			1,100,000			1,473,000
Average recorded investment	53,402,000		20,781,000	49,083,000		36,163,000
Interest income recognized, Total	363,000		250,000	569,000		344,000
Recorded investment in loans and leases by portfolio segment
Total, Allowance	51,686,000			51,686,000			48,473,000
Total Loans and Leases	4,603,913,000			4,603,913,000			4,362,465,000
Originated
Impaired Loans and Leases
Recorded investment, loans with no related allowance recorded	6,509,000	[1]		6,509,000	[1]		7,408,000	[2]
Recorded investment, loans with related allowance recorded	9,865,000	[1]		9,865,000	[1]		6,307,000	[2]
Recorded investment	16,374,000	[1]		16,374,000	[1]		13,715,000	[2]
Recorded investment, nonaccrual loans	6,100,000			6,100,000			5,800,000
Unpaid principal balance with no related allowance recorded	6,529,000			6,529,000			7,395,000
Unpaid principal balance with related allowance recorded	9,826,000			9,826,000			6,289,000
Unpaid principal balance	16,355,000			16,355,000			13,684,000
Related allowance	867,000			867,000			1,182,000
Average recorded investment with no related allowance recorded	6,786,000		6,401,000	9,198,000		8,053,000
Average recorded investment with related allowance recorded	10,392,000		5,619,000	7,255,000		6,630,000
Average recorded investment	17,178,000		12,020,000	16,453,000		14,683,000
Interest income recognized with no related allowance recorded	74,000		77,000	131,000		108,000
Interest income recognized with related allowance recorded	61,000		51,000	85,000		63,000
Interest income recognized, Total	135,000		128,000	216,000		171,000
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	867,000			867,000			1,182,000
Loans and Leases Collectively Evaluated for Impairment, Allowance	49,572,000			49,572,000			45,662,000
Total, Allowance	50,439,000			50,439,000			46,844,000
Loans and Leases Individually Evaluated for Impairment, Portfolio	16,375,000			16,375,000			13,715,000
Loans and Leases Collectively Evaluated for Impairment, Portfolio	3,840,432,000			3,840,432,000			3,533,338,000
Total Loans and Leases	3,856,807,000			3,856,807,000			3,547,053,000
Acquired
Impaired Loans and Leases
Recorded investment, loans with no related allowance recorded	31,372,000	[1]		31,372,000	[1]		17,197,000	[2]
Recorded investment, loans with related allowance recorded	4,210,000	[1]		4,210,000	[1]		2,294,000	[2]
Recorded investment	35,582,000	[1]		35,582,000	[1]		19,491,000	[2]
Recorded investment, nonaccrual loans	8,900,000			8,900,000			5,700,000
Unpaid principal balance with no related allowance recorded	31,978,000			31,978,000			18,367,000
Unpaid principal balance with related allowance recorded	4,398,000			4,398,000			2,358,000
Unpaid principal balance	36,376,000			36,376,000			20,725,000
Related allowance	233,000			233,000			291,000
Average recorded investment with no related allowance recorded	31,984,000		5,082,000	28,027,000		17,149,000
Average recorded investment with related allowance recorded	4,240,000		3,679,000	4,603,000		4,331,000
Average recorded investment	36,224,000		8,761,000	32,630,000		21,480,000
Interest income recognized with no related allowance recorded	210,000		122,000	297,000		173,000
Interest income recognized with related allowance recorded	18,000		0	56,000		0
Interest income recognized, Total	228,000		122,000	353,000		173,000
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	93,000			93,000			3,000
Loans and Leases Collectively Evaluated for Impairment, Allowance	166,000			166,000			384,000
Loans and Leases Acquired with Deteriorated Credit Quality, Allowance	988,000			988,000			1,242,000
Total, Allowance	1,247,000			1,247,000			1,629,000
Loans and Leases Individually Evaluated for Impairment, Portfolio	8,389,000			8,389,000			8,375,000
Loans and Leases Collectively Evaluated for Impairment, Portfolio	365,861,000			365,861,000			401,217,000
Loans and Leases Acquired with Deteriorated Credit Quality, Portfolio	372,856,000			372,856,000			405,820,000
Total Loans and Leases	747,106,000			747,106,000			815,412,000
Commercial real estate loans
Recorded investment in loans and leases by portfolio segment
Total, Allowance	26,715,000			26,715,000			23,022,000
Total Loans and Leases	2,314,585,000			2,314,585,000			2,203,623,000
Commercial real estate loans | Originated
Impaired Loans and Leases
Recorded investment, loans with no related allowance recorded	944,000	[1]		944,000	[1]		2,009,000	[2]
Recorded investment, loans with related allowance recorded	2,808,000	[1]		2,808,000	[1]		1,466,000	[2]
Unpaid principal balance with no related allowance recorded	944,000			944,000			2,009,000
Unpaid principal balance with related allowance recorded	2,808,000			2,808,000			1,466,000
Related allowance	47,000			47,000			184,000
Average recorded investment with no related allowance recorded	947,000		1,939,000	2,422,000		2,695,000
Average recorded investment with related allowance recorded	3,010,000		1,256,000	1,587,000		1,469,000
Interest income recognized with no related allowance recorded	12,000		30,000	48,000		30,000
Interest income recognized with related allowance recorded	22,000		10,000	22,000		17,000
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	47,000			47,000			184,000
Loans and Leases Collectively Evaluated for Impairment, Allowance	26,152,000			26,152,000			22,336,000
Total, Allowance	26,199,000			26,199,000			22,520,000
Loans and Leases Individually Evaluated for Impairment, Portfolio	3,753,000			3,753,000			3,643,000
Loans and Leases Collectively Evaluated for Impairment, Portfolio	1,914,042,000			1,914,042,000			1,765,589,000
Total Loans and Leases	1,917,795,000			1,917,795,000			1,769,232,000
Commercial real estate loans | Acquired
Impaired Loans and Leases
Recorded investment, loans with no related allowance recorded	19,870,000	[1]		19,870,000	[1]		9,176,000	[2]
Recorded investment, loans with related allowance recorded	1,521,000	[1]		1,521,000	[1]		1,274,000	[2]
Unpaid principal balance with no related allowance recorded	20,375,000			20,375,000			10,082,000
Unpaid principal balance with related allowance recorded	1,548,000			1,548,000			1,291,000
Related allowance	50,000			50,000			122,000
Average recorded investment with no related allowance recorded	20,402,000		3,217,000	13,990,000		11,291,000
Average recorded investment with related allowance recorded	1,522,000		3,679,000	2,971,000		3,700,000
Interest income recognized with no related allowance recorded	182,000		88,000	228,000		99,000
Interest income recognized with related allowance recorded	3,000		0	40,000		0
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	0			0			0
Loans and Leases Collectively Evaluated for Impairment, Allowance	(53,000)			(53,000)			(54,000)
Loans and Leases Acquired with Deteriorated Credit Quality, Allowance	569,000			569,000			556,000
Total, Allowance	516,000			516,000			502,000
Loans and Leases Individually Evaluated for Impairment, Portfolio	1,355,000			1,355,000			2,625,000
Loans and Leases Collectively Evaluated for Impairment, Portfolio	127,603,000			127,603,000			145,057,000
Loans and Leases Acquired with Deteriorated Credit Quality, Portfolio	267,832,000			267,832,000			286,709,000
Total Loans and Leases	396,790,000			396,790,000			434,391,000
Commercial
Recorded investment in loans and leases by portfolio segment
Total, Allowance	15,866,000			15,866,000			15,220,000
Total Loans and Leases	1,076,953,000			1,076,953,000			965,610,000
Commercial | Originated
Impaired Loans and Leases
Recorded investment, loans with no related allowance recorded	5,487,000	[1]		5,487,000	[1]		4,410,000	[2]
Recorded investment, loans with related allowance recorded	3,486,000	[1]		3,486,000	[1]		2,393,000	[2]
Unpaid principal balance with no related allowance recorded	5,507,000			5,507,000			4,399,000
Unpaid principal balance with related allowance recorded	3,457,000			3,457,000			2,383,000
Related allowance	820,000			820,000			675,000
Average recorded investment with no related allowance recorded	5,711,000		3,139,000	4,796,000		4,030,000
Average recorded investment with related allowance recorded	3,800,000		1,682,000	3,728,000		1,686,000
Interest income recognized with no related allowance recorded	62,000		29,000	70,000		60,000
Interest income recognized with related allowance recorded	24,000		6,000	48,000		7,000
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	820,000			820,000			675,000
Loans and Leases Collectively Evaluated for Impairment, Allowance	14,564,000			14,564,000			14,056,000
Total, Allowance	15,384,000			15,384,000			14,731,000
Loans and Leases Individually Evaluated for Impairment, Portfolio	8,974,000			8,974,000			6,634,000
Loans and Leases Collectively Evaluated for Impairment, Portfolio	941,708,000			941,708,000			821,174,000
Total Loans and Leases	950,682,000			950,682,000			827,808,000
Commercial | Acquired
Impaired Loans and Leases
Recorded investment, loans with no related allowance recorded	6,685,000	[1]		6,685,000	[1]		6,988,000	[2]
Recorded investment, loans with related allowance recorded	1,982,000	[1]		1,982,000	[1]		1,020,000	[2]
Unpaid principal balance with no related allowance recorded	6,786,000			6,786,000			7,248,000
Unpaid principal balance with related allowance recorded	2,143,000			2,143,000			1,067,000
Related allowance	149,000			149,000			169,000
Average recorded investment with no related allowance recorded	6,775,000		1,548,000	7,498,000		4,369,000
Average recorded investment with related allowance recorded	1,948,000		0	1,247,000		631,000
Interest income recognized with no related allowance recorded	23,000		26,000	59,000		66,000
Interest income recognized with related allowance recorded	14,000		0	15,000		0
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	59,000			59,000			3,000
Loans and Leases Collectively Evaluated for Impairment, Allowance	217,000			217,000			234,000
Loans and Leases Acquired with Deteriorated Credit Quality, Allowance	206,000			206,000			252,000
Total, Allowance	482,000			482,000			489,000
Loans and Leases Individually Evaluated for Impairment, Portfolio	4,707,000			4,707,000			4,878,000
Loans and Leases Collectively Evaluated for Impairment, Portfolio	90,418,000			90,418,000			93,565,000
Loans and Leases Acquired with Deteriorated Credit Quality, Portfolio	31,146,000			31,146,000			39,359,000
Total Loans and Leases	126,271,000			126,271,000			137,802,000
Indirect automobile
Recorded investment in loans and leases by portfolio segment
Total, Allowance	3,686,000			3,686,000			3,924,000
Total Loans and Leases	376,314,000			376,314,000			400,531,000
Indirect automobile | Originated
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	0			0			0
Loans and Leases Collectively Evaluated for Impairment, Allowance	3,686,000			3,686,000			3,924,000
Total, Allowance	3,686,000			3,686,000			3,924,000
Loans and Leases Individually Evaluated for Impairment, Portfolio	0			0			0
Loans and Leases Collectively Evaluated for Impairment, Portfolio	376,314,000			376,314,000			400,531,000
Total Loans and Leases	376,314,000			376,314,000			400,531,000
Indirect automobile | Acquired
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	0			0			0
Loans and Leases Collectively Evaluated for Impairment, Allowance	0			0			0
Loans and Leases Acquired with Deteriorated Credit Quality, Allowance	0			0			0
Total, Allowance	0			0			0
Loans and Leases Individually Evaluated for Impairment, Portfolio	0			0			0
Loans and Leases Collectively Evaluated for Impairment, Portfolio	0			0			0
Loans and Leases Acquired with Deteriorated Credit Quality, Portfolio	0			0			0
Total Loans and Leases	0			0			0
Consumer loans
Recorded investment in loans and leases by portfolio segment
Total, Allowance	3,017,000			3,017,000			3,375,000
Total Loans and Leases	836,061,000			836,061,000			792,701,000
Consumer loans | Originated
Impaired Loans and Leases
Recorded investment, loans with no related allowance recorded	78,000	[1]		78,000	[1]		989,000	[2]
Recorded investment, loans with related allowance recorded	3,571,000	[1]		3,571,000	[1]		2,448,000	[2]
Unpaid principal balance with no related allowance recorded	78,000			78,000			987,000
Unpaid principal balance with related allowance recorded	3,561,000			3,561,000			2,440,000
Related allowance	0			0			323,000
Average recorded investment with no related allowance recorded	128,000		1,323,000	1,980,000		1,328,000
Average recorded investment with related allowance recorded	3,582,000		2,681,000	1,940,000		3,475,000
Interest income recognized with no related allowance recorded	0		18,000	13,000		18,000
Interest income recognized with related allowance recorded	15,000		35,000	15,000		39,000
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	0			0			323,000
Loans and Leases Collectively Evaluated for Impairment, Allowance	2,768,000			2,768,000			2,414,000
Total, Allowance	2,768,000			2,768,000			2,737,000
Loans and Leases Individually Evaluated for Impairment, Portfolio	3,648,000			3,648,000			3,438,000
Loans and Leases Collectively Evaluated for Impairment, Portfolio	608,368,000			608,368,000			546,044,000
Total Loans and Leases	612,016,000			612,016,000			549,482,000
Consumer loans | Acquired
Impaired Loans and Leases
Recorded investment, loans with no related allowance recorded	4,817,000	[1]		4,817,000	[1]		1,033,000	[2]
Recorded investment, loans with related allowance recorded	707,000	[1]		707,000	[1]		0	[2]
Unpaid principal balance with no related allowance recorded	4,817,000			4,817,000			1,037,000
Unpaid principal balance with related allowance recorded	707,000			707,000			0
Related allowance	34,000			34,000			0
Average recorded investment with no related allowance recorded	4,807,000		317,000	6,539,000		1,489,000
Average recorded investment with related allowance recorded	770,000		0	385,000		0
Interest income recognized with no related allowance recorded	5,000		8,000	10,000		8,000
Interest income recognized with related allowance recorded	1,000		0	1,000		0
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	34,000			34,000			0
Loans and Leases Collectively Evaluated for Impairment, Allowance	2,000			2,000			204,000
Loans and Leases Acquired with Deteriorated Credit Quality, Allowance	213,000			213,000			434,000
Total, Allowance	249,000			249,000			638,000
Loans and Leases Individually Evaluated for Impairment, Portfolio	2,327,000			2,327,000			872,000
Loans and Leases Collectively Evaluated for Impairment, Portfolio	147,840,000			147,840,000			162,595,000
Loans and Leases Acquired with Deteriorated Credit Quality, Portfolio	73,878,000			73,878,000			79,752,000
Total Loans and Leases	224,045,000			224,045,000			243,219,000
Unallocated
Recorded investment in loans and leases by portfolio segment
Total, Allowance	2,402,000			2,402,000			2,932,000
Total Loans and Leases	0			0			0
Unallocated | Originated
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	0			0			0
Loans and Leases Collectively Evaluated for Impairment, Allowance	2,402,000			2,402,000			2,932,000
Total, Allowance	2,402,000			2,402,000			2,932,000
Loans and Leases Individually Evaluated for Impairment, Portfolio	0			0			0
Loans and Leases Collectively Evaluated for Impairment, Portfolio	0			0			0
Total Loans and Leases	0			0			0
Unallocated | Acquired
Recorded investment in loans and leases by portfolio segment
Loans and Leases Individually Evaluated for Impairment, Allowance	0			0			0
Loans and Leases Collectively Evaluated for Impairment, Allowance	0			0			0
Loans and Leases Acquired with Deteriorated Credit Quality, Allowance	0			0			0
Total, Allowance	0			0			0
Loans and Leases Individually Evaluated for Impairment, Portfolio	0			0			0
Loans and Leases Collectively Evaluated for Impairment, Portfolio	0			0			0
Loans and Leases Acquired with Deteriorated Credit Quality, Portfolio	0			0			0
Total Loans and Leases	$ 0			$ 0			$ 0

[1] )Includes originated and acquired nonaccrual loans of $6.1 million and $8.9 million at June 30, 2014, respectively.

[2] Includes originated and acquired nonaccrual loans of $5.8 million and $5.7 million at December 31, 2013, respectively.

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Basis of Presentation

6 Months Ended

Jun. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

Overview

Brookline Bancorp, Inc. (the “Company”) is a bank holding company (within the meaning of the Bank Holding Company Act of 1956, as amended) and the parent of Brookline Bank, a Massachusetts-chartered savings bank; Bank Rhode Island (“BankRI”), a Rhode Island-chartered bank; and First Ipswich Bank (“First Ipswich” and formerly known as the First National Bank of Ipswich), a Massachusetts-chartered trust company (collectively referred to as the “Banks”). The Banks are all members of the Federal Reserve System. The Company is also the parent of Brookline Securities Corp. (“BSC”). The Company’s primary business is to provide commercial, business and retail banking services to its corporate, municipal and individual customers through its banks and non-bank subsidiaries.

Brookline Bank, which includes its wholly-owned subsidiaries BBS Investment Corp. and Longwood Securities Corp., and its 84.7%-owned subsidiary, Eastern Funding LLC (“Eastern Funding”), operates 23 full-service banking offices in the greater Boston metropolitan area. BankRI, which includes its wholly-owned subsidiaries BRI Investment Corp., Macrolease Corporation (“Macrolease”), Acorn Insurance Agency and BRI Realty Corp., operates 19 full-service banking offices in the greater Providence area. First Ipswich, which includes its wholly-owned subsidiaries First Ipswich Securities II Corp. and First Ipswich Insurance Agency, operates 6 full-service banking offices on the north shore of eastern Massachusetts and in the Boston metropolitan area.

The Company’s activities include acceptance of commercial, municipal and retail deposits, origination of mortgage loans on commercial and residential real estate located principally in Massachusetts and Rhode Island, origination of commercial loans and leases to small- and mid-sized businesses, origination of indirect automobile loans, investment in debt and equity securities, and the offering of cash management and investment advisory services. The Company also provides specialty equipment financing through its subsidiaries Eastern Funding, which is based in New York City, and Macrolease, which is based in Plainview, New York.

The Company and the Banks are supervised, examined and regulated by the Board of Governors of the Federal Reserve System ("FRB"). As Massachusetts-chartered member banks, Brookline Bank and First Ipswich are also subject to regulation under the laws of the Commonwealth of Massachusetts and the jurisdiction of the Massachusetts Division of Banks. BankRI is subject to regulation under the laws of the State of Rhode Island and the jurisdiction of the Banking Division of the Rhode Island Department of Business Regulation.

The Federal Deposit Insurance Corporation (“FDIC”) offers insurance coverage on all deposits up to $250,000 per depositor at each of the three Banks. As FDIC-insured depository institutions, all three Banks are also secondarily subject to supervision, examination and regulation by the FDIC. Additionally, as a Massachusetts-chartered savings bank, Brookline Bank is also insured by the Depositors Insurance Fund (“DIF”), a private industry-sponsored insurance company. The DIF insures savings bank deposits in excess of the FDIC insurance limits. As such, Brookline Bank offers 100% insurance on all deposits as a result of a combination of insurance from the FDIC and the DIF. Brookline Bank is required to file reports with the DIF.

Basis of Financial Statement Presentation

The unaudited consolidated financial statements of the Company presented herein have been prepared pursuant to the rules of the Securities and Exchange Commission (“SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“GAAP”). In the opinion of management, all adjustments (consisting of normal recurring adjustments) and disclosures considered necessary for the fair presentation of the accompanying consolidated financial statements have been included. Interim results are not necessarily reflective of the results of the entire year. The accompanying unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2013. 

The unaudited consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances are eliminated in consolidation.

In preparing these consolidated financial statements, management is required to make significant estimates and assumptions that affect the reported amounts of assets, liabilities, income, expenses and disclosure of contingent assets and liabilities. Actual results could differ from those estimates based upon changing conditions, including economic conditions and future events. Material estimates that are particularly susceptible to significant change in the near-term include the determination of the allowance for loan and lease losses, the determination of fair market values of assets and liabilities, including acquired loans and leases, the review of goodwill and intangibles for impairment and the review of deferred tax assets for valuation allowances.

The judgments used by management in applying these critical accounting policies may be affected by a further and prolonged deterioration in the economic environment, which may result in changes to future financial results. For example, subsequent evaluations of the loan and lease portfolio, in light of the factors then prevailing, may result in significant changes in the allowance for loan and lease losses in future periods, and the inability to collect outstanding principal may result in increased loan and lease losses.

Reclassification

Certain previously reported amounts have been reclassified to conform to the current year’s presentation. These reclassifications did not change stockholders' equity and net income reported.

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Commitments and Contingencies (Details) (USD $)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Loan commitments
Unadvanced portion of loans and leases	$ 549,473,000		$ 586,279,000
Unused lines of credit:
Home equity	212,857,000		205,665,000
Other consumer	6,386,000		6,503,000
Other commercial	1,138,000		1,035,000
Unused letters of credit:
Financial standby letters of credit	18,322,000		20,410,000
Performance standby letters of credit	3,189,000		2,989,000
Commercial and similar letters of credit	2,302,000		440,000
Back-to-back interest-rate swaps	28,017,000		22,418,000
Unfunded credit commitments liability included in other liabilities	1,200,000	900,000	1,000,000
Fair value of interest rate swap assets	900,000		800,000
Fair value of interest rate swap liabilities	900,000		900,000
Summary of future minimum rental payments under noncancellable operating leases year ending December 31
Remainder of 2014	2,695,000
2015	5,477,000
2016	5,333,000
2017	4,804,000
2018	4,229,000
Thereafter	15,582,000
Total	38,120,000
Total rental expense	3,600,000	2,500,000
Operating leases, rent expense, acceleration	800,000
Commercial real estate mortgage loans
Loan commitments
Commitments to originate loans and leases	67,378,000		48,973,000
Commercial
Loan commitments
Commitments to originate loans and leases	146,347,000		143,252,000
Residential mortgage
Loan commitments
Commitments to originate loans and leases	$ 10,524,000		$ 8,027,000

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Allowance for Loan and Lease Losses (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Changes in allowance for loan losses
Balance at the beginning of the period	$ 50,224,000	$ 42,532,000	$ 48,473,000	$ 41,152,000
Charge-offs	(1,196,000)	(1,030,000)	(2,246,000)	(1,691,000)
Recoveries	476,000	391,000	860,000	633,000
Provision (credit) for loan and lease losses	2,182,000	2,388,000	4,599,000	4,187,000
Balance at the end of the period	51,686,000	44,281,000	51,686,000	44,281,000
Unfunded credit commitments liability included in other liabilities	1,200,000	900,000	1,200,000	900,000	1,000,000
Increase (decrease) in liability for unfunded credit commitment			200,000	200,000
Unfunded credit commitments liability charged off			0	0
Provision for credit losses
Total provision for loan and lease losses	2,182,000	2,388,000	4,599,000	4,187,000
Unfunded credit commitments	94,000	51,000	120,000	107,000
Total provision for credit losses	2,276,000	2,439,000	4,719,000	4,294,000
General allowance for loan and lease losses	48,200,000		48,200,000		44,100,000
Increase in general portion of the allowance for loan and lease losses			4,100,000
Specific allowance for loan and lease losses	1,100,000		1,100,000		1,500,000
Decrease in specific portion of the allowance for loan and lease losses			400,000
Unallocated allowance for loan and lease losses	2,400,000		2,400,000		2,900,000
Decrease in unallocated portion of the allowance for loan and lease losses			500,000
Commercial Real Estate
Changes in allowance for loan losses
Balance at the beginning of the period	24,858,000	20,588,000	23,022,000	20,018,000
Charge-offs	0	(81,000)	0	(81,000)
Recoveries	0	0	0	4,000
Provision (credit) for loan and lease losses	1,857,000	1,512,000	3,693,000	2,078,000
Balance at the end of the period	26,715,000	22,019,000	26,715,000	22,019,000
Provision for credit losses
Total provision for loan and lease losses	1,857,000	1,512,000	3,693,000	2,078,000
Number of loan classes within specific portfolio	3		3
Commercial
Changes in allowance for loan losses
Balance at the beginning of the period	15,544,000	11,652,000	15,220,000	10,655,000
Charge-offs	(796,000)	(477,000)	(1,347,000)	(724,000)
Recoveries	218,000	182,000	469,000	264,000
Provision (credit) for loan and lease losses	900,000	434,000	1,524,000	1,596,000
Balance at the end of the period	15,866,000	11,791,000	15,866,000	11,791,000
Provision for credit losses
Total provision for loan and lease losses	900,000	434,000	1,524,000	1,596,000
Number of loan classes within specific portfolio	3		3
Indirect Automobile
Changes in allowance for loan losses
Balance at the beginning of the period	3,664,000	5,000,000	3,924,000	5,304,000
Charge-offs	(228,000)	(318,000)	(517,000)	(680,000)
Recoveries	173,000	149,000	277,000	279,000
Provision (credit) for loan and lease losses	77,000	(136,000)	2,000	(208,000)
Balance at the end of the period	3,686,000	4,695,000	3,686,000	4,695,000
Provision for credit losses
Total provision for loan and lease losses	77,000	(136,000)	2,000	(208,000)
Consumer
Changes in allowance for loan losses
Balance at the beginning of the period	3,110,000	2,596,000	3,375,000	2,545,000
Charge-offs	(172,000)	(154,000)	(382,000)	(206,000)
Recoveries	85,000	60,000	114,000	86,000
Provision (credit) for loan and lease losses	(6,000)	497,000	(90,000)	574,000
Balance at the end of the period	3,017,000	2,999,000	3,017,000	2,999,000
Provision for credit losses
Total provision for loan and lease losses	(6,000)	497,000	(90,000)	574,000
Number of loan classes within specific portfolio	3		3
Unallocated
Changes in allowance for loan losses
Balance at the beginning of the period	3,048,000	2,696,000	2,932,000	2,630,000
Charge-offs	0	0	0	0
Recoveries	0	0	0	0
Provision (credit) for loan and lease losses	(646,000)	81,000	(530,000)	147,000
Balance at the end of the period	2,402,000	2,777,000	2,402,000	2,777,000
Provision for credit losses
Total provision for loan and lease losses	$ (646,000)	$ 81,000	$ (530,000)	$ 147,000

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Earnings per Share (Tables)

6 Months Ended

Jun. 30, 2014

Earnings Per Share [Abstract]

Schedule of reconciliation of basic and diluted earnings per share (EPS)

The following table sets forth a reconciliation of basic and diluted earnings per share (“EPS”) for the periods indicated:

	Three Months Ended
	June 30, 2014				June 30, 2013
	Basic		Fully Diluted		Basic		Fully Diluted
	(In Thousands Except Share Data)
Numerator:
Net income	$	9,976	$	9,976	$	9,490	$	9,490
Denominator:
Weighted average shares outstanding	69,886,576		69,886,576		69,774,703		69,774,703
Effect of dilutive securities	—		125,801		—		58,838
Adjusted weighted average shares outstanding	69,886,576		70,012,377		69,774,703		69,833,541
EPS	$	0.14	$	0.14	$	0.14	$	0.14

	Six Months Ended
	June 30, 2014				June 30, 2013
	Basic		Fully Diluted		Basic		Fully Diluted
	(In Thousands Except Share Data)
Numerator:
Net income	$	20,398	$	20,398	$	18,304	$	18,304
Denominator:
Weighted average shares outstanding	69,881,055		69,881,055		69,768,777		69,768,777
Effect of dilutive securities	—		117,164		—		54,838
Adjusted weighted average shares outstanding	69,881,055		69,998,219		69,768,777		69,823,615
EPS	$	0.29	$	0.29	$	0.26	$	0.26

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Derivatives and Hedging Activities (Tables)

6 Months Ended

Jun. 30, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of fair value and classification of the Company's derivative financial instruments on the unaudited consolidated balance sheets and the effect of the Company's derivative financial instruments on the unaudited consolidated income statements

The table below presents the fair value and classification of the Company’s derivative financial instruments on the consolidated balance sheets at June 30, 2014 and December 31, 2013, and the effect of the Company’s derivative financial instruments on the consolidated statements of income for the three months and six months endedJune 30, 2014 and June 30, 2013. Asset derivatives and liability derivatives are included in other assets and accrued expenses and other liabilities on the consolidated balance sheets, respectively. Changes in the fair value are recognized directly in earnings and are included in other non-interest income in the consolidated statements of income.

	At June 30, 2014				At December 31, 2013
	Asset Derivatives		Liability Derivatives		Asset Derivatives		Liability Derivatives
	(In Thousands)
Total derivatives (interest-rate products) not designated as hedging instruments	$	887	$	912	$	825	$	856

	Three Months Ended June 30,					Six Months Ended June 30,
	2014		2013			2014	2013
	(In Thousands)
Gain (loss) recognized in income on derivatives (1)	$	4	$	(22	)	6	$	(25	)

(1) The amount of gain (loss) recognized in income on derivatives represents changes related to the fair value of the interest rate products.

Schedule of offsetting of derivatives and amounts subject to master netting agreements not offset in the unaudited consolidated balance sheet

The tables below present the offsetting of derivatives and amounts subject to master netting agreements not offset in the unaudited consolidated balance sheet at the dates indicated.

	At June 30, 2014
	Gross Amounts of Recognized Assets /Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets Presented in the Statement of Financial Position		Gross Amounts Not Offset in the Statement of Financial Position				Net Amount
							Financial Instruments		Cash Collateral (Received)/ Posted
	(In Thousands)
Asset Derivatives	$	887	$	—	$	887	$	—	$	—	$	887
Liability Derivatives	$	912	$	—	$	912	$	—	$	2,770	$	3,682

	At December 31, 2013
	Gross Amounts of Recognized Assets /Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets Presented in the Statement of Financial Position		Gross Amounts Not Offset in the Statement of Financial Position				Net Amount
							Financial Instruments		Cash Collateral (Received) / Posted
	(In Thousands)
Asset Derivatives	$	825	$	—	$	825	$	—	$	—	$	825
Liability Derivatives	$	856	$	—	$	856	$	—	$	2,811	$	3,667

XML

Stock Based Compensation (Details) (USD $) In Millions, except Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2014 bank plan	Jun. 30, 2013	Jun. 30, 2014 Time-based Awards [Member] Tranche one [Member]	Jun. 30, 2014 Performance Shares [Member] Tranche two [Member]	Jun. 30, 2014 Recognition and Retention Plan 2003 [Member]	Jun. 30, 2014 Restricted Stock Plan 2011 [Member]	Jul. 09, 2014 Subsequent Event [Member] Equity Incentive Plan 2014 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock based compensation plans	2
Shares authorized					1,250,000	500,000	1,750,000
Percent of shares in tranche			50.00%	50.00%
Award vesting period			3 years	3 years
Vesting percentage			33.33%
Number of financial institutions defining performance targets	22
Stock based compensation expense	$ 0.6	$ 0.5

XML

Allowance for Loan and Lease Losses (Details 2) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Credit Quality Information
Recorded investment	$ 4,603,913	$ 4,362,465
Originated
Credit Quality Information
Recorded investment	3,856,807	3,547,053
Acquired
Credit Quality Information
Recorded investment	747,106	815,412
Commercial real estate mortgage
Credit Quality Information
Recorded investment	1,545,483	1,461,985
Commercial real estate mortgage | Originated
Credit Quality Information
Recorded investment	1,229,783	1,111,750
Commercial real estate mortgage | Acquired
Credit Quality Information
Recorded investment	315,700	350,235
Commercial real estate mortgage | Pass | Originated
Credit Quality Information
Recorded investment	1,220,046	1,099,108
Commercial real estate mortgage | Pass | Acquired
Credit Quality Information
Recorded investment	301,358	332,145
Commercial real estate mortgage | OAEM | Originated
Credit Quality Information
Recorded investment	8,685	11,555
Commercial real estate mortgage | OAEM | Acquired
Credit Quality Information
Recorded investment	4,569	7,556
Commercial real estate mortgage | Substandard | Originated
Credit Quality Information
Recorded investment	1,052	1,087
Commercial real estate mortgage | Substandard | Acquired
Credit Quality Information
Recorded investment	9,727	8,645
Commercial real estate mortgage | Doubtful | Originated
Credit Quality Information
Recorded investment	0	0
Commercial real estate mortgage | Doubtful | Acquired
Credit Quality Information
Recorded investment	46	1,889
Multi-family mortgage
Credit Quality Information
Recorded investment	631,371	627,933
Multi-family mortgage | Originated
Credit Quality Information
Recorded investment	562,072	554,555
Multi-family mortgage | Acquired
Credit Quality Information
Recorded investment	69,299	73,378
Multi-family mortgage | Pass | Originated
Credit Quality Information
Recorded investment	561,705	554,183
Multi-family mortgage | Pass | Acquired
Credit Quality Information
Recorded investment	63,085	69,310
Multi-family mortgage | OAEM | Originated
Credit Quality Information
Recorded investment	367	372
Multi-family mortgage | OAEM | Acquired
Credit Quality Information
Recorded investment	2,553	463
Multi-family mortgage | Substandard | Originated
Credit Quality Information
Recorded investment	0	0
Multi-family mortgage | Substandard | Acquired
Credit Quality Information
Recorded investment	3,661	3,605
Multi-family mortgage | Doubtful | Originated
Credit Quality Information
Recorded investment	0	0
Multi-family mortgage | Doubtful | Acquired
Credit Quality Information
Recorded investment	0	0
Construction
Credit Quality Information
Recorded investment	137,731	113,705
Construction | Originated
Credit Quality Information
Recorded investment	125,940	102,927
Construction | Acquired
Credit Quality Information
Recorded investment	11,791	10,778
Construction | Pass | Originated
Credit Quality Information
Recorded investment	125,940	102,927
Construction | Pass | Acquired
Credit Quality Information
Recorded investment	11,523	10,090
Construction | OAEM | Originated
Credit Quality Information
Recorded investment	0	0
Construction | OAEM | Acquired
Credit Quality Information
Recorded investment	268	688
Construction | Substandard | Originated
Credit Quality Information
Recorded investment	0	0
Construction | Substandard | Acquired
Credit Quality Information
Recorded investment	0	0
Construction | Doubtful | Originated
Credit Quality Information
Recorded investment	0	0
Construction | Doubtful | Acquired
Credit Quality Information
Recorded investment	0	0
Commercial
Credit Quality Information
Recorded investment	478,856	407,792
Commercial | Originated
Credit Quality Information
Recorded investment	370,813	297,684
Commercial | Acquired
Credit Quality Information
Recorded investment	108,043	110,108
Commercial | Pass | Originated
Credit Quality Information
Recorded investment	359,654	295,057
Commercial | Pass | Acquired
Credit Quality Information
Recorded investment	96,171	96,779
Commercial | OAEM | Originated
Credit Quality Information
Recorded investment	8,853	49
Commercial | OAEM | Acquired
Credit Quality Information
Recorded investment	2,468	4,617
Commercial | Substandard | Originated
Credit Quality Information
Recorded investment	1,011	1,078
Commercial | Substandard | Acquired
Credit Quality Information
Recorded investment	9,256	8,518
Commercial | Doubtful | Originated
Credit Quality Information
Recorded investment	1,295	1,500
Commercial | Doubtful | Acquired
Credit Quality Information
Recorded investment	148	194
Equipment Financing
Credit Quality Information
Recorded investment	552,489	513,024
Equipment Financing | Originated
Credit Quality Information
Recorded investment	534,261	485,330
Equipment Financing | Acquired
Credit Quality Information
Recorded investment	18,228	27,694
Equipment Financing | Pass | Originated
Credit Quality Information
Recorded investment	529,588	479,811
Equipment Financing | Pass | Acquired
Credit Quality Information
Recorded investment	18,123	27,535
Equipment Financing | OAEM | Originated
Credit Quality Information
Recorded investment	1,082	625
Equipment Financing | OAEM | Acquired
Credit Quality Information
Recorded investment	33	61
Equipment Financing | Substandard | Originated
Credit Quality Information
Recorded investment	3,002	4,817
Equipment Financing | Substandard | Acquired
Credit Quality Information
Recorded investment	72	98
Equipment Financing | Doubtful | Originated
Credit Quality Information
Recorded investment	589	77
Equipment Financing | Doubtful | Acquired
Credit Quality Information
Recorded investment	0	0
Condominium association
Credit Quality Information
Recorded investment	45,608	44,794
Condominium association | Originated
Credit Quality Information
Recorded investment	45,608	44,794
Condominium association | Acquired
Credit Quality Information
Recorded investment	0	0
Condominium association | Pass | Originated
Credit Quality Information
Recorded investment	45,608	44,793
Condominium association | Pass | Acquired
Credit Quality Information
Recorded investment	0	0
Condominium association | OAEM | Originated
Credit Quality Information
Recorded investment	0	0
Condominium association | OAEM | Acquired
Credit Quality Information
Recorded investment	0	0
Condominium association | Substandard | Originated
Credit Quality Information
Recorded investment	0	1
Condominium association | Substandard | Acquired
Credit Quality Information
Recorded investment	0	0
Condominium association | Doubtful | Originated
Credit Quality Information
Recorded investment	0	0
Condominium association | Doubtful | Acquired
Credit Quality Information
Recorded investment	0	0
Other Consumer
Credit Quality Information
Recorded investment	15,044	7,055
Other Consumer | Originated
Credit Quality Information
Recorded investment	14,343	5,532
Other Consumer | Acquired
Credit Quality Information
Recorded investment	701	1,523
Other Consumer | Pass | Originated
Credit Quality Information
Recorded investment	14,332	5,528
Other Consumer | Pass | Acquired
Credit Quality Information
Recorded investment	689	1,509
Other Consumer | OAEM | Originated
Credit Quality Information
Recorded investment	0	0
Other Consumer | OAEM | Acquired
Credit Quality Information
Recorded investment	0	0
Other Consumer | Substandard | Originated
Credit Quality Information
Recorded investment	11	4
Other Consumer | Substandard | Acquired
Credit Quality Information
Recorded investment	12	14
Other Consumer | Doubtful | Originated
Credit Quality Information
Recorded investment	0	0
Other Consumer | Doubtful | Acquired
Credit Quality Information
Recorded investment	0	0
Indirect Automobile
Credit Quality Information
Recorded investment	376,314	400,531
Indirect Automobile | Originated
Credit Quality Information
Recorded investment	376,314	400,531
Percentage of loans to aggregate outstanding amount	100.00%	100.00%
Indirect Automobile | Acquired
Credit Quality Information
Recorded investment	0	0
Indirect Automobile | Credit score, Over 700 | Originated
Credit Quality Information
Recorded investment	312,755	332,140
Percentage of loans to aggregate outstanding amount	83.10%	82.90%
Indirect Automobile | Credit score, 661-700 | Originated
Credit Quality Information
Recorded investment	50,960	54,038
Percentage of loans to aggregate outstanding amount	13.60%	13.50%
Indirect Automobile | Credit score, 660 and below | Originated
Credit Quality Information
Recorded investment	11,083	12,793
Percentage of loans to aggregate outstanding amount	2.90%	3.20%
Indirect Automobile | Data not available | Originated
Credit Quality Information
Recorded investment	1,516	1,560
Percentage of loans to aggregate outstanding amount	0.40%	0.40%
Residential mortgage
Credit Quality Information
Recorded investment	550,814	528,185
Percentage of loans to aggregate outstanding amount	100.00%	100.00%
Residential mortgage | Originated
Credit Quality Information
Recorded investment	442,551	411,554
Percentage of loans to aggregate outstanding amount	80.30%	77.90%
Residential mortgage | Acquired
Credit Quality Information
Recorded investment	108,263	116,631
Percentage of loans to aggregate outstanding amount	19.70%	22.10%
Residential mortgage | Loan-to-value ratio, less than 50% | Originated
Credit Quality Information
Recorded investment	104,052	94,500
Percentage of loans to aggregate outstanding amount	18.90%	17.90%
Residential mortgage | Loan-to-value ratio, less than 50% | Acquired
Credit Quality Information
Recorded investment	20,075	23,101
Percentage of loans to aggregate outstanding amount	3.70%	4.40%
Residential mortgage | Loan-to-value ratio, 50% - 69% | Originated
Credit Quality Information
Recorded investment	155,284	149,969
Percentage of loans to aggregate outstanding amount	28.20%	28.40%
Residential mortgage | Loan-to-value ratio, 50% - 69% | Acquired
Credit Quality Information
Recorded investment	37,392	39,298
Percentage of loans to aggregate outstanding amount	6.80%	7.40%
Residential mortgage | Loan-to-value ratio, 70% - 79% | Originated
Credit Quality Information
Recorded investment	150,649	139,960
Percentage of loans to aggregate outstanding amount	27.30%	26.50%
Residential mortgage | Loan-to-value ratio, 70% - 79% | Acquired
Credit Quality Information
Recorded investment	27,166	31,932
Percentage of loans to aggregate outstanding amount	4.90%	6.00%
Residential mortgage | Loan-to-value ratio, 80% and over | Originated
Credit Quality Information
Recorded investment	29,114	22,772
Percentage of loans to aggregate outstanding amount	5.30%	4.30%
Residential mortgage | Loan-to-value ratio, 80% and over | Acquired
Credit Quality Information
Recorded investment	19,167	19,870
Percentage of loans to aggregate outstanding amount	3.50%	3.80%
Residential mortgage | Data not available | Originated
Credit Quality Information
Recorded investment	3,452	4,353
Percentage of loans to aggregate outstanding amount	0.60%	0.80%
Residential mortgage | Data not available | Acquired
Credit Quality Information
Recorded investment	4,463	2,430
Percentage of loans to aggregate outstanding amount	0.80%	0.50%
Home Equity
Credit Quality Information
Recorded investment	270,203	257,461
Percentage of loans to aggregate outstanding amount	100.00%	100.00%
Home Equity | Originated
Credit Quality Information
Recorded investment	155,122	132,396
Percentage of loans to aggregate outstanding amount	57.40%	51.40%
Home Equity | Acquired
Credit Quality Information
Recorded investment	115,081	125,065
Percentage of loans to aggregate outstanding amount	42.60%	48.60%
Home Equity | Loan-to-value ratio, less than 50% | Originated
Credit Quality Information
Recorded investment	92,667	75,372
Percentage of loans to aggregate outstanding amount	34.30%	29.30%
Home Equity | Loan-to-value ratio, less than 50% | Acquired
Credit Quality Information
Recorded investment	76,631	84,272
Percentage of loans to aggregate outstanding amount	28.40%	32.70%
Home Equity | Loan-to-value ratio, 50% - 69% | Originated
Credit Quality Information
Recorded investment	33,727	31,504
Percentage of loans to aggregate outstanding amount	12.50%	12.20%
Home Equity | Loan-to-value ratio, 50% - 69% | Acquired
Credit Quality Information
Recorded investment	24,276	25,964
Percentage of loans to aggregate outstanding amount	9.00%	10.10%
Home Equity | Loan-to-value ratio, 70% - 79% | Originated
Credit Quality Information
Recorded investment	23,972	21,161
Percentage of loans to aggregate outstanding amount	8.90%	8.20%
Home Equity | Loan-to-value ratio, 70% - 79% | Acquired
Credit Quality Information
Recorded investment	11,973	13,390
Percentage of loans to aggregate outstanding amount	4.40%	5.20%
Home Equity | Loan-to-value ratio, 80% and over | Originated
Credit Quality Information
Recorded investment	3,823	3,240
Percentage of loans to aggregate outstanding amount	1.40%	1.30%
Home Equity | Loan-to-value ratio, 80% and over | Acquired
Credit Quality Information
Recorded investment	1,483	1,208
Percentage of loans to aggregate outstanding amount	0.50%	0.50%
Home Equity | Data not available | Originated
Credit Quality Information
Recorded investment	933	1,119
Percentage of loans to aggregate outstanding amount	0.30%	0.40%
Home Equity | Data not available | Acquired
Credit Quality Information
Recorded investment	$ 718	$ 231
Percentage of loans to aggregate outstanding amount	0.30%	0.10%

XML

Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2014

Fair value of assets and liabilities

Schedule of the carrying value of assets and liabilities measured at fair value on a recurring basis

The following tables set forth the carrying value of assets and liabilities measured at fair value on a recurring basis at the dates indicated:

	Carrying Value at June 30, 2014
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets:
Investment securities available-for-sale:
GSEs	$	—	$	15,978	$	—	$	15,978
GSE CMOs	—		247,547		—		247,547
GSE MBSs	—		221,847		—		221,847
SBA commercial loan asset-backed securities	—		226		—		226
Corporate debt obligations	—		40,330		—		40,330
Trust preferred securities	—		1,299		—		1,299
Marketable equity securities	1,359		—		—		1,359
Total investment securities available-for-sale	$	1,359	$	527,227	$	—	$	528,586
Interest-rate swaps	$	—	$	887	$	—	$	887
Liabilities:
Interest-rate swaps	$	—	$	912	$	—	$	912

	Carrying Value at December 31, 2013
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets:
Investment securities available-for-sale:
GSEs	$	—	$	12,180	$	—	$	12,180
GSE CMOs	—		243,644		—		243,644
GSE MBSs	—		199,401		—		199,401
Private-label CMOs	—		3,355		—		3,355
SBA commercial loan asset-backed securities	—		243		—		243
Auction-rate municipal obligations	—		—		1,775		1,775
Municipal obligations	—		1,086		—		1,086
Corporate debt obligations	—		28,224		—		28,224
Trust preferred securities	—		1,210		—		1,210
Marketable equity securities	1,310		—		—		1,310
Total investment securities available-for-sale	$	1,310	$	489,343	$	1,775	$	492,428
Interest-rate swaps	$	—	$	825	$	—	$	825
Liabilities:
Interest-rate swaps	$	—	$	856	$	—	$	856

Schedule of reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3)

The reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands)
Investment securities available-for-sale, beginning of period	$	1,690		$	2,852		$	1,775		$	2,917
Investment security sales	(1,658		)	—			(1,658		)	—
Principal paydowns and other	—			(207		)	—			(330		)
Total realized losses included in other income	(242		)	—			(242		)	—
Total unrealized losses included in other comprehensive income	210			190			125			248
Investment securities available-for-sale, end of period	$	—		$	2,835		$	—		$	2,835

Summary of assets and liabilities measured at fair value on a non-recurring basis

The table below summarizes assets and liabilities measured at fair value on a non-recurring basis at the dates indicated:

	Carrying Value at June 30, 2014
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets measured at fair value on a non-recurring basis:
Collateral-dependent impaired loans and leases	$	—	$	—	$	4,927	$	4,927
Other real estate owned	—		—		675		675
Repossessed vehicles and equipment	—		571		—		571
Total assets measured at fair value on a non-recurring basis	$	—	$	571	$	5,602	$	6,173

	Carrying Value at December 31, 2013
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets measured at fair value on a non-recurring basis:
Collateral-dependent impaired loans and leases	$	—	$	—	$	12,099	$	12,099
Other real estate owned	—		—		577		577
Repossessed vehicles and equipment	—		1,001		—		1,001
Total assets measured at fair value on a non-recurring basis	$	—	$	1,001	$	12,676	$	13,677

Schedule of quantitative information about significant unobservable inputs (Level 3) for assets measured at fair value on a recurring basis

The table below presents quantitative information about significant unobservable inputs (Level 3) for assets measured at fair value on a recurring and non-recurring basis at June 30, 2014.

	Fair Value		Valuation Technique
	(Dollars in Thousands)
Collateral-dependent impaired loans and leases	$	4,927	Appraisal of collateral (1)
Other real estate owned	$	675	Appraisal of collateral (1)

(1) Fair value is generally determined through independent appraisals of the underlying collateral. The Company may also use another available source of collateral assessment to determine a reasonable estimate of the fair value of the collateral. The valuation generally includes various Level 3 inputs which are not identifiable. Appraisals may be adjusted by management for qualitative factors such as economic factors and estimated liquidation expenses. The range of these possible adjustments may vary.

Excludes Financial Instruments For Which The Carrying Amount Approximates Fair Value

Fair value of assets and liabilities

Summary of assets and liabilities measured at fair value on a non-recurring basis

The following table presents the carrying amount, estimated fair value, and placement in the fair value hierarchy of the Company’s financial instruments at the dates indicated. This table excludes financial instruments for which the carrying amount approximates fair value. Financial assets for which the fair value approximates carrying value include cash and cash equivalents, FHLBB and FRB stock and accrued interest receivable. Financial liabilities for which the fair value approximates carrying value include non-maturity deposits, short-term borrowings and accrued interest payable.

					Fair Value Measurements
	Carrying Value		Estimated Fair Value		Level 1 Inputs		Level 2 Inputs		Level 3 Inputs
	(In Thousands)
At June 30, 2014
Financial assets:
Investment securities held-to-maturity	$	500	$	500	$	—	$	—	$	500
Loans held-for-sale	13,890		13,890		—		13,890		—
Loans and leases, net	4,552,227		4,522,877		—		—		4,522,877
Financial liabilities:
Certificates of deposit	900,216		903,673		—		903,673		—
Borrowed funds	1,041,004		1,045,320		—		1,045,320		—
At December 31, 2013
Financial assets:
Investment securities held-to-maturity	$	500	$	500	$	—	$	—	$	500
Loans held-for-sale	13,372		13,372		—		13,372		—
Loans and leases, net	4,313,992		4,552,556		—		—		4,552,556
Financial liabilities:
Certificates of deposit	934,668		938,703		—		938,703		—
Borrowed funds	812,555		815,910		—		815,910		—

XML

Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

Schedule of financial instruments with off-balance sheet risk

Financial instruments with off-balance-sheet risk at the dates indicated follow:

	At June 30, 2014		At December 31, 2013
	(In Thousands)
Financial instruments whose contract amounts represent credit risk:
Commitments to originate loans and leases:
Commercial real estate	$	67,378	$	48,973
Commercial	146,347		143,252
Residential mortgage	10,524		8,027
Unadvanced portion of loans and leases	549,473		586,279
Unused lines of credit:
Home equity	212,857		205,665
Other consumer	6,386		6,503
Other commercial	1,138		1,035
Unused letters of credit:
Financial standby letters of credit	18,322		20,410
Performance standby letters of credit	3,189		2,989
Commercial and similar letters of credit	2,302		440
Back-to-back interest-rate swaps	28,017		22,418

Schedule of future minimum rental payments under noncancellable operating leases

The Company leases certain office space under various noncancellable operating leases. A summary of future minimum rental payments under such leases at the dates indicated follows:

	Minimum Rental Payments
	(In Thousands)
Remainder of 2014	2,695
Year ending:
2015	5,477
2016	5,333
2017	4,804
2018	4,229
Thereafter	15,582
Total	$	38,120

XML

Unaudited Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Cash flows from operating activities:
Net income attributable to Brookline Bancorp, Inc.	$ 20,398	$ 18,304
Adjustments to reconcile net income to net cash provided from operating activities:
Net income attributable to noncontrolling interest in subsidiary	898	802
Provision for credit losses	4,719	4,294
Origination of loans and leases to be sold	(15,784)	(23,378)
Proceeds from loans and leases sold	15,922	22,871
Proceeds from sales of other real estate owned and repossessed assets	6,795	5,495
Deferred income tax expense	1,046	(676)
Depreciation of premises and equipment	3,416	2,822
Amortization of investment securities premiums and discounts, net	1,448	1,809
Amortization of deferred loan and lease origination costs, net	4,991	5,160
Amortization of identified intangible assets	1,688	2,342
Accretion of acquisition fair value adjustments, net	(6,884)	(4,008)
Gain on sales of loans and leases held-for-sale	(656)	(481)
Loss on sales of investment securities, net	13	0
Gains on sales of other real estate owned and repossessed assets	(27)	(24)
Write-down of other real estate owned and repossessed assets	189	178
(Gain)/loss on sale/disposals of premises and equipment, net	(1,504)	21
Compensation under recognition and retention plans	435	536
Loss from investments in affordable housing projects	1,043	936
ESOP shares committed to be released	185	186
Net change in:
Cash surrender value of bank-owned life insurance	(519)	(551)
Other assets	(148)	11,627
Accrued expenses and other liabilities	(6,279)	(13,559)
Net cash provided from operating activities	31,385	34,706
Cash flows from investing activities:
Proceeds from sales of investment securities available-for-sale	5,083	0
Proceeds from maturities, calls and principal repayments of investment securities available-for-sale	34,062	69,826
Purchases of investment securities available-for-sale	(69,108)	(82,283)
Proceeds from maturities, calls, and principal repayments of investment securities held-to-maturity	500	0
Purchases of investment securities held-to-maturity	(500)	0
Proceeds from redemption of restricted equity securities	0	2,108
Purchases of restricted equity securities	(4,887)	(74)
Net increase in loans and leases	(248,738)	(38,673)
Proceeds from sales or premises and equipment	1,972	81
Purchase of premises and equipment	(5,635)	(9,072)
Net cash used for investing activities	(287,251)	(58,087)
Cash flows from financing activities:
Increase in demand checking, NOW, savings and money market accounts	60,593	79,161
Decrease in certificates of deposit	(34,584)	(38,717)
Proceeds from FHLBB advances	1,606,764	1,767,800
Repayment of FHLBB advances	(1,368,461)	(1,771,275)
Repayment of subordinated debt	0	(18,567)
Decrease in other borrowed funds, net	(8,460)	0
Increase in mortgagors' escrow accounts	470	519
Payment of dividends on common stock	(11,928)	(11,915)
Proceeds from issuance of noncontrolling units	60	0
Payment of dividends to owners of noncontrolling interest in subsidiary	(1,360)	(927)
Net cash provided from (used in) financing activities	243,094	6,079
Net decrease in cash and cash equivalents	(12,772)	(17,302)
Cash and cash equivalents at beginning of period	92,505	117,097
Cash and cash equivalents at end of period	79,733	99,795
Cash paid during the period for:
Interest on deposits, borrowed funds and subordinated debt	15,438	17,884
Income taxes	8,490	11,301
Non-cash investing activities:
Transfer from loans to other real estate owned	$ 6,625	$ 5,650

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Basis of Presentation (Details) (USD $)	6 Months Ended
	Jun. 30, 2014 bank office
Basis of Presentation
Number of full-service banking offices	23
FDIC insurance limit per depositor	$ 250,000
Number of banks on whose deposits insurance coverage was offered	3
Percentage of insurance offered	100.00%
Eastern Funding LLC
Basis of Presentation
Percentage of ownership in subsidiary	84.70%
BankRI
Basis of Presentation
Number of full-service banking offices	19
First Ipswich Bancorp:
Basis of Presentation
Number of full-service banking offices	6

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Loans and Leases (Details 2) (Acquired, USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Acquired
Summarized activity in accretable yield for the acquired loan portfolio
Balance at the beginning of the period	$ 42,501,000	$ 53,815,000	$ 45,789,000	$ 57,812,000
Reclassification from nonaccretable difference for loans with improved cash flows	214,000	3,180,000	1,654,000	5,376,000
Accretion	(4,537,000)	(4,813,000)	(9,265,000)	(11,006,000)
Balance at the end of the period	38,178,000	52,182,000	38,178,000	52,182,000
Aggregate remaining nonaccretable difference (representing both principal and interest) applicable to acquired loans	$ 4,600,000		$ 4,600,000		$ 6,100,000

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Comprehensive Income/(Loss) - Reclassifications (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Provision for income taxes	$ (5,774)	$ (5,382)	$ (11,769)	$ (10,511)
Net income attributable to Brookline Bancorp, Inc.	9,976	9,490	20,398	18,304
Investment Securities Available-for-Sale | Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Loss on sales of securities, net	(13)		(13)
Provision for income taxes	5		5
Net income attributable to Brookline Bancorp, Inc.	$ (8)		$ (8)

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Unaudited Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
ASSETS
Cash and due from banks	$ 58,962	$ 37,148
Short-term investments	20,771	55,357
Total cash and cash equivalents	79,733	92,505
Investment securities available-for-sale	528,586	492,428
Investment securities held-to-maturity (fair value of $500)	500	500
Total investment securities	529,086	492,928
Loans held-for-sale	13,890	13,372
Total loans and leases	4,603,913	4,362,465
Allowance for loan and lease losses	(51,686)	(48,473)
Net loans and leases	4,552,227	4,313,992
Restricted equity securities	71,446	66,559
Premises and equipment, net of accumulated depreciation of $41,067 and $44,420, respectively	82,166	80,505
Deferred tax asset	27,799	31,710
Goodwill	137,890	137,890
Identified intangible assets, net of accumulated amortization of $24,583 and $22,895, respectively	15,199	16,887
Other real estate owned and repossessed assets, net	1,246	1,578
Other assets	76,804	77,180
Total assets	5,587,486	5,325,106
Non-interest-bearing deposits:
Demand checking accounts	716,883	707,023
Interest-bearing deposits:
NOW accounts	209,682	210,602
Savings accounts	518,343	494,734
Money market accounts	1,516,023	1,487,979
Certificate of deposit accounts	900,216	934,668
Total interest-bearing deposits	3,144,264	3,127,983
Total deposits	3,861,147	3,835,006
Borrowed funds:
Advances from the FHLBB	1,005,644	768,773
Other borrowed funds	35,360	43,782
Total borrowed funds	1,041,004	812,555
Mortgagors' escrow accounts	8,359	7,889
Accrued expenses and other liabilities	45,411	51,485
Total liabilities	4,955,921	4,706,935
Commitments and contingencies
Brookline Bancorp, Inc. stockholders' equity:
Common stock, $0.01 par value; 200,000,000 shares authorized; 75,744,445 shares issued	757	757
Additional paid-in capital	617,709	617,538
Retained earnings, partially restricted	73,373	64,903
Accumulated other comprehensive loss	(3,209)	(7,915)
Treasury stock, at cost; 5,144,807 shares and 5,171,985 shares, respectively	(59,487)	(59,826)
Unallocated common stock held by ESOP; 271,524 shares and 291,666 shares, respectively	(1,480)	(1,590)
Total Brookline Bancorp, Inc. stockholders' equity	627,663	613,867
Noncontrolling interest in subsidiary	3,902	4,304
Total equity	631,565	618,171
Total liabilities and equity	5,587,486	5,325,106
Commercial real estate loans
ASSETS
Total loans and leases	2,314,585	2,203,623
Allowance for loan and lease losses	(26,715)	(23,022)
Commercial loans
ASSETS
Total loans and leases	1,076,953	965,610
Allowance for loan and lease losses	(15,866)	(15,220)
Indirect automobile
ASSETS
Total loans and leases	376,314	400,531
Allowance for loan and lease losses	(3,686)	(3,924)
Consumer loans
ASSETS
Total loans and leases	836,061	792,701
Allowance for loan and lease losses	$ (3,017)	$ (3,375)

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Allowance for Loan and Lease Losses (Details 3) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Age analysis of past due loans
Past due 31-60 days	$ 14,993	$ 34,125
Past due 61-90 days	4,182	5,882
Past due Greater than 90 days	14,386	17,861
Past due Total	33,561	57,868
Current	4,570,352	4,304,597
Total Loans and Leases	4,603,913	4,362,465
Loans and leases past due greater than 90 days and accruing	6,653	10,913
Nonaccrual loans and leases	17,161	16,501
Originated
Age analysis of past due loans
Past due 31-60 days	8,355	28,288
Past due 61-90 days	2,373	3,884
Past due Greater than 90 days	3,692	3,690
Past due Total	14,420	35,862
Current	3,842,387	3,511,191
Total Loans and Leases	3,856,807	3,547,053
Loans and leases past due greater than 90 days and accruing	195	10
Nonaccrual loans and leases	7,779	8,245
Acquired
Age analysis of past due loans
Past due 31-60 days	6,638	5,837
Past due 61-90 days	1,809	1,998
Past due Greater than 90 days	10,694	14,171
Past due Total	19,141	22,006
Current	727,965	793,406
Total Loans and Leases	747,106	815,412
Loans and leases past due greater than 90 days and accruing	6,458	10,903
Nonaccrual loans and leases	9,382	8,256
Commercial real estate loans
Age analysis of past due loans
Total Loans and Leases	2,314,585	2,203,623
Commercial real estate loans | Originated
Age analysis of past due loans
Past due 31-60 days	0	19,296
Past due 61-90 days	888	1,393
Past due Greater than 90 days	235	169
Past due Total	1,123	20,858
Current	1,916,672	1,748,374
Total Loans and Leases	1,917,795	1,769,232
Loans and leases past due greater than 90 days and accruing	71	0
Nonaccrual loans and leases	1,052	169
Commercial real estate loans | Acquired
Age analysis of past due loans
Past due 31-60 days	5,034	1,548
Past due 61-90 days	362	496
Past due Greater than 90 days	3,418	5,939
Past due Total	8,814	7,983
Current	387,976	426,408
Total Loans and Leases	396,790	434,391
Loans and leases past due greater than 90 days and accruing	2,923	5,010
Nonaccrual loans and leases	1,959	929
Commercial real estate mortgage
Age analysis of past due loans
Total Loans and Leases	1,545,483	1,461,985
Commercial real estate mortgage | Originated
Age analysis of past due loans
Past due 31-60 days	0	4,896
Past due 61-90 days	888	1,393
Past due Greater than 90 days	164	169
Past due Total	1,052	6,458
Current	1,228,731	1,105,292
Total Loans and Leases	1,229,783	1,111,750
Loans and leases past due greater than 90 days and accruing	0	0
Nonaccrual loans and leases	1,052	169
Commercial real estate mortgage | Acquired
Age analysis of past due loans
Past due 31-60 days	3,754	1,221
Past due 61-90 days	362	87
Past due Greater than 90 days	2,122	4,887
Past due Total	6,238	6,195
Current	309,462	344,040
Total Loans and Leases	315,700	350,235
Loans and leases past due greater than 90 days and accruing	1,627	3,958
Nonaccrual loans and leases	1,959	929
Multi-family mortgage
Age analysis of past due loans
Total Loans and Leases	631,371	627,933
Multi-family mortgage | Originated
Age analysis of past due loans
Past due 31-60 days	0	14,400
Past due 61-90 days	0	0
Past due Greater than 90 days	71	0
Past due Total	71	14,400
Current	562,001	540,155
Total Loans and Leases	562,072	554,555
Loans and leases past due greater than 90 days and accruing	71	0
Nonaccrual loans and leases	0	0
Multi-family mortgage | Acquired
Age analysis of past due loans
Past due 31-60 days	1,012	327
Past due 61-90 days	0	0
Past due Greater than 90 days	1,296	1,052
Past due Total	2,308	1,379
Current	66,991	71,999
Total Loans and Leases	69,299	73,378
Loans and leases past due greater than 90 days and accruing	1,296	1,052
Nonaccrual loans and leases	0	0
Construction
Age analysis of past due loans
Total Loans and Leases	137,731	113,705
Construction | Originated
Age analysis of past due loans
Past due 31-60 days	0	0
Past due 61-90 days	0	0
Past due Greater than 90 days	0	0
Past due Total	0	0
Current	125,940	102,927
Total Loans and Leases	125,940	102,927
Loans and leases past due greater than 90 days and accruing	0	0
Nonaccrual loans and leases	0	0
Construction | Acquired
Age analysis of past due loans
Past due 31-60 days	268	0
Past due 61-90 days	0	409
Past due Greater than 90 days	0	0
Past due Total	268	409
Current	11,523	10,369
Total Loans and Leases	11,791	10,778
Loans and leases past due greater than 90 days and accruing	0	0
Nonaccrual loans and leases	0	0
Commercial loans
Age analysis of past due loans
Total Loans and Leases	1,076,953	965,610
Commercial loans | Originated
Age analysis of past due loans
Past due 31-60 days	2,995	3,155
Past due 61-90 days	881	1,633
Past due Greater than 90 days	3,394	2,873
Past due Total	7,270	7,661
Current	943,412	820,147
Total Loans and Leases	950,682	827,808
Loans and leases past due greater than 90 days and accruing	122	0
Nonaccrual loans and leases	4,590	5,638
Commercial loans | Acquired
Age analysis of past due loans
Past due 31-60 days	383	2,753
Past due 61-90 days	335	162
Past due Greater than 90 days	3,387	2,004
Past due Total	4,105	4,919
Current	122,166	132,883
Total Loans and Leases	126,271	137,802
Loans and leases past due greater than 90 days and accruing	937	1,308
Nonaccrual loans and leases	5,044	4,626
Commercial
Age analysis of past due loans
Total Loans and Leases	478,856	407,792
Commercial | Originated
Age analysis of past due loans
Past due 31-60 days	1,657	2,288
Past due 61-90 days	355	75
Past due Greater than 90 days	1,296	842
Past due Total	3,308	3,205
Current	367,505	294,479
Total Loans and Leases	370,813	297,684
Loans and leases past due greater than 90 days and accruing	0	0
Nonaccrual loans and leases	1,339	1,551
Commercial | Acquired
Age analysis of past due loans
Past due 31-60 days	383	2,707
Past due 61-90 days	300	121
Past due Greater than 90 days	3,315	1,931
Past due Total	3,998	4,759
Current	104,045	105,349
Total Loans and Leases	108,043	110,108
Loans and leases past due greater than 90 days and accruing	864	1,235
Nonaccrual loans and leases	5,044	4,597
Equipment financing
Age analysis of past due loans
Total Loans and Leases	552,489	513,024
Equipment financing | Originated
Age analysis of past due loans
Past due 31-60 days	1,199	867
Past due 61-90 days	526	1,558
Past due Greater than 90 days	2,098	2,031
Past due Total	3,823	4,456
Current	530,438	480,874
Total Loans and Leases	534,261	485,330
Loans and leases past due greater than 90 days and accruing	122	0
Nonaccrual loans and leases	3,251	4,086
Equipment financing | Acquired
Age analysis of past due loans
Past due 31-60 days	0	46
Past due 61-90 days	35	41
Past due Greater than 90 days	72	73
Past due Total	107	160
Current	18,121	27,534
Total Loans and Leases	18,228	27,694
Loans and leases past due greater than 90 days and accruing	73	73
Nonaccrual loans and leases	0	29
Condominium association
Age analysis of past due loans
Total Loans and Leases	45,608	44,794
Condominium association | Originated
Age analysis of past due loans
Past due 31-60 days	139	0
Past due 61-90 days	0	0
Past due Greater than 90 days	0	0
Past due Total	139	0
Current	45,469	44,794
Total Loans and Leases	45,608	44,794
Loans and leases past due greater than 90 days and accruing	0	0
Nonaccrual loans and leases	0	1
Condominium association | Acquired
Age analysis of past due loans
Total Loans and Leases	0	0
Indirect automobile
Age analysis of past due loans
Total Loans and Leases	376,314	400,531
Indirect automobile | Originated
Age analysis of past due loans
Past due 31-60 days	4,754	5,407
Past due 61-90 days	579	857
Past due Greater than 90 days	19	229
Past due Total	5,352	6,493
Current	370,962	394,038
Total Loans and Leases	376,314	400,531
Loans and leases past due greater than 90 days and accruing	2	10
Nonaccrual loans and leases	325	259
Indirect automobile | Acquired
Age analysis of past due loans
Total Loans and Leases	0	0
Consumer loans
Age analysis of past due loans
Total Loans and Leases	836,061	792,701
Consumer loans | Originated
Age analysis of past due loans
Past due 31-60 days	606	430
Past due 61-90 days	25	1
Past due Greater than 90 days	44	419
Past due Total	675	850
Current	611,341	548,632
Total Loans and Leases	612,016	549,482
Loans and leases past due greater than 90 days and accruing	0	0
Nonaccrual loans and leases	1,812	2,179
Consumer loans | Acquired
Age analysis of past due loans
Past due 31-60 days	1,221	1,536
Past due 61-90 days	1,112	1,340
Past due Greater than 90 days	3,889	6,228
Past due Total	6,222	9,104
Current	217,823	234,115
Total Loans and Leases	224,045	243,219
Loans and leases past due greater than 90 days and accruing	2,598	4,585
Nonaccrual loans and leases	2,379	2,701
Residential mortgage
Age analysis of past due loans
Total Loans and Leases	550,814	528,185
Residential mortgage | Originated
Age analysis of past due loans
Past due 31-60 days	493	201
Past due 61-90 days	0	0
Past due Greater than 90 days	29	415
Past due Total	522	616
Current	442,029	410,938
Total Loans and Leases	442,551	411,554
Loans and leases past due greater than 90 days and accruing	0	0
Nonaccrual loans and leases	1,393	1,713
Residential mortgage | Acquired
Age analysis of past due loans
Past due 31-60 days	456	271
Past due 61-90 days	53	777
Past due Greater than 90 days	3,090	5,329
Past due Total	3,599	6,377
Current	104,664	110,254
Total Loans and Leases	108,263	116,631
Loans and leases past due greater than 90 days and accruing	2,428	4,468
Nonaccrual loans and leases	991	1,162
Home equity
Age analysis of past due loans
Total Loans and Leases	270,203	257,461
Home equity | Originated
Age analysis of past due loans
Past due 31-60 days	100	218
Past due 61-90 days	21	0
Past due Greater than 90 days	0	0
Past due Total	121	218
Current	155,001	132,178
Total Loans and Leases	155,122	132,396
Loans and leases past due greater than 90 days and accruing	0	0
Nonaccrual loans and leases	404	462
Home equity | Acquired
Age analysis of past due loans
Past due 31-60 days	764	1,259
Past due 61-90 days	1,049	552
Past due Greater than 90 days	783	895
Past due Total	2,596	2,706
Current	112,485	122,359
Total Loans and Leases	115,081	125,065
Loans and leases past due greater than 90 days and accruing	170	117
Nonaccrual loans and leases	1,367	1,525
Other consumer
Age analysis of past due loans
Total Loans and Leases	15,044	7,055
Other consumer | Originated
Age analysis of past due loans
Past due 31-60 days	13	11
Past due 61-90 days	4	1
Past due Greater than 90 days	15	4
Past due Total	32	16
Current	14,311	5,516
Total Loans and Leases	14,343	5,532
Loans and leases past due greater than 90 days and accruing	0	0
Nonaccrual loans and leases	15	4
Other consumer | Acquired
Age analysis of past due loans
Past due 31-60 days	1	6
Past due 61-90 days	10	11
Past due Greater than 90 days	16	4
Past due Total	27	21
Current	674	1,502
Total Loans and Leases	701	1,523
Loans and leases past due greater than 90 days and accruing	0	0
Nonaccrual loans and leases	$ 21	$ 14

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Unaudited Consolidated Statements of Changes in Equity (USD $) In Thousands, unless otherwise specified	Total	Total Brookline Bancorp, Inc. Stockholders' Equity	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive (Loss) Income	Treasury Stock	Unallocated Common Stock Held by ESOP	Noncontrolling Interest in Subsidiary
Balance at Dec. 31, 2012	$ 615,809	$ 612,097	$ 757	$ 618,426	$ 53,358	$ 3,483	$ (62,107)	$ (1,820)	$ 3,712
Increase (Decrease) in Stockholders' Equity
Net income attributable to Brookline Bancorp, Inc.	18,304	18,304			18,304
Net income attributable to noncontrolling interest in subsidiary	802								802
Other comprehensive income (loss)	(7,924)	(7,924)				(7,924)
Common stock dividends of $0.17 per share for the period ended June 30, 2014 and 2013	(11,915)	(11,915)			(11,915)
Dividend to owners of noncontrolling interest in subsidiary	(927)								(927)
Compensation under recognition and retention plan	536	536		536					0
Common stock held by ESOP committed to be released (20,142 and 21,126 shares for the six month period ended June 30, 2014 and 2013, respectively)	186	186		71				115
Balance at Jun. 30, 2013	614,871	611,284	757	619,033	59,747	(4,441)	(62,107)	(1,705)	3,587
Balance at Dec. 31, 2013	618,171	613,867	757	617,538	64,903	(7,915)	(59,826)	(1,590)	4,304
Increase (Decrease) in Stockholders' Equity
Net income attributable to Brookline Bancorp, Inc.	20,398	20,398			20,398
Net income attributable to noncontrolling interest in subsidiary	898								898
Issuance of noncontrolling units	60								60
Other comprehensive income (loss)	4,706	4,706				4,706
Common stock dividends of $0.17 per share for the period ended June 30, 2014 and 2013	(11,928)	(11,928)			(11,928)
Dividend to owners of noncontrolling interest in subsidiary	(1,360)								(1,360)
Compensation under recognition and retention plan	435	435		96			339
Common stock held by ESOP committed to be released (20,142 and 21,126 shares for the six month period ended June 30, 2014 and 2013, respectively)	185	185		75			0	110
Balance at Jun. 30, 2014	$ 631,565	$ 627,663	$ 757	$ 617,709	$ 73,373	$ (3,209)	$ (59,487)	$ (1,480)	$ 3,902

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Fair Value of Financial Instruments (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Reconciliation of assets measured at fair value on a recurring basis
Investment security sales		$ 0		$ 0
Total realized losses included in other income		0		0
Securities available for sale
Reconciliation of assets measured at fair value on a recurring basis
Investment securities available-for-sale, beginning of period	1,690	2,852	1,775	2,917
Investment security sales	(1,658)		(1,658)
Principal paydowns and other	0	(207)	0	(330)
Total realized losses included in other income	(242)		(242)
Total unrealized losses included in other comprehensive income	210	190	125	248
Investment securities available-for-sale, end of period	$ 0	$ 2,835	$ 0	$ 2,835

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Investment Securities (Details 3) (USD $)	6 Months Ended					6 Months Ended			6 Months Ended						6 Months Ended				6 Months Ended			12 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013	Jun. 30, 2014 U.S. Government-Sponsored Enterprises excluding GNMA MBSs and CMOs, and SBA commercial loan asset-backed securities	Dec. 31, 2013 U.S. Government-Sponsored Enterprises excluding GNMA MBSs and CMOs, and SBA commercial loan asset-backed securities	Jun. 30, 2014 GSEs security	Jun. 30, 2013 GSEs	Dec. 31, 2013 GSEs security	Jun. 30, 2014 GSE mortgage-related securities security	Jun. 30, 2013 GSE mortgage-related securities	Dec. 31, 2013 GSE mortgage-related securities security	Jun. 30, 2014 SBA commercial loan asset-backed securities security	Dec. 31, 2013 SBA commercial loan asset-backed securities security	Dec. 31, 2013 Private-label CMOs security	Jun. 30, 2014 Auction-rate municipal obligations issuer	Dec. 31, 2013 Auction-rate municipal obligations	Jun. 30, 2014 Municipal obligations security	Dec. 31, 2013 Municipal obligations	Jun. 30, 2014 Corporate debt obligations issuer security	Jun. 30, 2013 Corporate debt obligations	Dec. 31, 2013 Corporate debt obligations security	Dec. 31, 2013 Trust preferred securities and pools: security	Jun. 30, 2014 Trust preferred securities and pools: security	Jun. 30, 2014 Marketable equity securities security	Dec. 31, 2013 Marketable equity securities security
Additional disclosures
Estimated fair value	$ 528,586,000		$ 492,428,000	$ 25,400,000	$ 18,900,000	$ 15,978,000		$ 12,180,000	$ 469,400,000		$ 443,000,000	$ 226,000	$ 243,000	$ 3,355,000		$ 1,775,000		$ 1,086,000	$ 40,330,000		$ 28,224,000	$ 1,210,000	$ 1,299,000	$ 1,359,000	$ 1,310,000
Net unrealized gain (loss)						10,000		42,000	(6,300,000)		(13,800,000)			100,000		(100,000)			600,000		500,000	(300,000)	(200,000)	100,000	100,000
Number of trust preferred securities																						2
Number of securities under unrealized loss position						1		0	96		86	7	7	2			0		1		2	2	2	1	1
Number of securities						6		5	241		232	9	9	11					13		11		2	4	4
Purchases of investment securities available-for-sale	$ 69,108,000	$ 82,283,000				$ 2,000,000	$ 0		$ 55,100,000	$ 82,300,000									$ 12,000,000	$ 0
Number of issuers defaulting on scheduled payments															0				0

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Basis of Presentation (Policies)

6 Months Ended

Jun. 30, 2014

Accounting Policies

Basis of Financial Statement Presentation

Basis of Financial Statement Presentation

The unaudited consolidated financial statements of the Company presented herein have been prepared pursuant to the rules of the Securities and Exchange Commission (“SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“GAAP”). In the opinion of management, all adjustments (consisting of normal recurring adjustments) and disclosures considered necessary for the fair presentation of the accompanying consolidated financial statements have been included. Interim results are not necessarily reflective of the results of the entire year. The accompanying unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2013. 

The unaudited consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances are eliminated in consolidation.

In preparing these consolidated financial statements, management is required to make significant estimates and assumptions that affect the reported amounts of assets, liabilities, income, expenses and disclosure of contingent assets and liabilities. Actual results could differ from those estimates based upon changing conditions, including economic conditions and future events. Material estimates that are particularly susceptible to significant change in the near-term include the determination of the allowance for loan and lease losses, the determination of fair market values of assets and liabilities, including acquired loans and leases, the review of goodwill and intangibles for impairment and the review of deferred tax assets for valuation allowances.

The judgments used by management in applying these critical accounting policies may be affected by a further and prolonged deterioration in the economic environment, which may result in changes to future financial results. For example, subsequent evaluations of the loan and lease portfolio, in light of the factors then prevailing, may result in significant changes in the allowance for loan and lease losses in future periods, and the inability to collect outstanding principal may result in increased loan and lease losses.

Reclassification

Reclassification

Certain previously reported amounts have been reclassified to conform to the current year’s presentation. These reclassifications did not change stockholders' equity and net income reported.

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Investment Securities (Details 4) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Dec. 31, 2013
Investments, Debt and Equity Securities [Abstract]
Amortized Cost	$ 500	$ 500
Investment securities held to maturity, fair value (in dollars)	$ 500	$ 500
Interest rate payable	1.30%

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Loans and Leases (Tables)

6 Months Ended

Jun. 30, 2014

Receivables [Abstract]

Summary of loan and lease balances and weighted average coupon rates for the originated and acquired portfolios

The following tables present loan and lease balances and weighted average coupon rates for the originated and acquired loan and lease portfolios at the dates indicated:

	At June 30, 2014
	Originated				Acquired				Total
	Balance		Weighted Average Coupon		Balance		Weighted Average Coupon		Balance		Weighted Average Coupon
	(Dollars in Thousands)
Commercial real estate loans:
Commercial real estate mortgage	$	1,229,783	4.29	%	$	315,700	4.38	%	$	1,545,483	4.31	%
Multi-family mortgage	562,072		4.12	%	69,299		4.54	%	631,371		4.17	%
Construction	125,940		3.87	%	11,791		4.43	%	137,731		3.92	%
Total commercial real estate loans	1,917,795		4.21	%	396,790		4.41	%	2,314,585		4.25	%
Commercial loans and leases:
Commercial	370,813		3.70	%	108,043		4.39	%	478,856		3.86	%
Equipment financing	534,261		6.97	%	18,228		6.35	%	552,489		6.95	%
Condominium association	45,608		4.68	%	—		—	%	45,608		4.68	%
Total commercial loans and leases	950,682		5.58	%	126,271		4.67	%	1,076,953		5.48	%
Indirect automobile loans	376,314		4.62	%	—		—	%	376,314		4.62	%
Consumer loans:
Residential mortgage	442,551		3.62	%	108,263		3.86	%	550,814		3.67	%
Home equity	155,122		3.39	%	115,081		3.86	%	270,203		3.59	%
Other consumer	14,343		4.51	%	701		14.87	%	15,044		5.00	%
Total consumer loans	612,016		3.58	%	224,045		3.90	%	836,061		3.67	%
Total loans and leases	$	3,856,807	4.49	%	$	747,106	4.29	%	$	4,603,913	4.45	%

	At December 31, 2013
	Originated				Acquired				Total
	Balance		Weighted Average Coupon		Balance		Weighted Average Coupon		Balance		Weighted Average Coupon
	(Dollars in Thousands)
Commercial real estate loans:
Commercial real estate mortgage	$	1,111,750	4.34	%	$	350,235	4.42	%	$	1,461,985	4.36	%
Multi-family mortgage	554,555		4.19	%	73,378		4.63	%	627,933		4.24	%
Construction	102,927		3.81	%	10,778		4.37	%	113,705		3.87	%
Total commercial real estate loans	1,769,232		4.26	%	434,391		4.46	%	2,203,623		4.30	%
Commercial loans and leases:
Commercial	297,684		3.68	%	110,108		4.54	%	407,792		3.91	%
Equipment financing	485,330		7.14	%	27,694		6.60	%	513,024		7.11	%
Condominium association	44,794		4.74	%	—		—	%	44,794		4.74	%
Total commercial loans and leases	827,808		5.77	%	137,802		4.95	%	965,610		5.65	%
Indirect automobile loans	400,531		4.98	%	—		—	%	400,531		4.98	%
Consumer loans:
Residential mortgage	411,554		3.65	%	116,631		3.93	%	528,185		3.71	%
Home equity	132,396		3.39	%	125,065		3.88	%	257,461		3.63	%
Other consumer	5,532		5.98	%	1,523		14.89	%	7,055		7.90	%
Total consumer loans	549,482		3.61	%	243,219		3.98	%	792,701		3.72	%
Total loans and leases	$	3,547,053	4.59	%	$	815,412	4.38	%	$	4,362,465	4.55	%

Schedule of activity in the accretable yield for acquired loan portfolio

The following table summarizes activity in the accretable yield for the acquired loan portfolio for the periods indicated:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands)
Balance at beginning of period	$	42,501		$	53,815		$	45,789		$	57,812
Reclassification from nonaccretable difference for loans with improved cash flows	214			3,180			1,654			5,376
Accretion	(4,537		)	(4,813		)	(9,265		)	(11,006		)
Balance at end of period	$	38,178		$	52,182		$	38,178		$	52,182

Summary of the change in the total amounts of loans and advances, all of which were performing, to directors, executive officers and their affiliates

The following table summarizes the change in the total amounts of loans and advances, to directors, executive officers and their affiliates for the periods indicated. All loans were performing at June 30, 2014 and December 31, 2013.

	Six Months Ended June 30,
	2014			2013
	(In Thousands)
Balance at beginning of period	$	16,110		$	4,083
New loans granted during the period	1,740			100
Advances on lines of credit	1,451			91
Repayments	(522		)	(349		)
Loans no longer classified as related party loans	(978		)	545
Balance at end of period	$	17,801		$	4,470

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Consolidated Statements of Changes in Equity (Parenthetical) (USD $)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Statement of Stockholders' Equity [Abstract]
Common stock dividends, per share (in dollars per share)	$ 0.17	$ 0.17
Common stock held by ESOP committed to be released, shares	20,142	21,126

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Unaudited Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Statement of Financial Position [Abstract]
Investment securities held to maturity, fair value (in dollars)	$ 500	$ 500
Premises and equipment, accumulated depreciation and amortization (in dollars)	41,067	44,420
Identified intangible assets, accumulated amortization (in dollars)	$ 24,583	$ 22,895
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	75,744,445	75,744,445
Treasury stock, shares	5,144,807	5,171,985
Unallocated common stock held by ESOP, shares	271,524	291,666

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Derivatives and Hedging Activities

6 Months Ended

Jun. 30, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives and Hedging Activities

Derivatives and Hedging Activities

The Company may use interest-rate contracts (swaps, caps and floors) as part of interest-rate risk management strategy. Interest-rate swap, cap and floor agreements are entered into as hedges against future interest-rate fluctuations on specifically identified assets or liabilities. The Company did not have derivative fair value hedges or derivative cash flow hedges at June 30, 2014 or December 31, 2013.

Derivatives not designated as hedges are not speculative but rather, result from a service the Company provides to certain customers for a fee. The Company executes interest-rate swaps with commercial banking customers to aid them in managing their interest-rate risk. The interest-rate swap contracts allow the commercial banking customers to convert floating-rate loan payments to fixed-rate loan payments. The Company concurrently enters into offsetting swaps with a third-party financial institution, effectively minimizing its net risk exposure resulting from such transactions. The third-party financial institution exchanges the customer’s fixed-rate loan payments for floating-rate loan payments. As the interest-rate swaps associated with this program do not meet hedge accounting requirements, changes in the fair value of both the customer swaps and the offsetting swaps are recognized directly in earnings. The Company had 10 interest-rate swaps related to this program with an aggregate notional amount of $28.0 million at June 30, 2014, compared with 8 interest-rate swaps with an aggregate notional amount of $22.4 million at December 31, 2013.

The table below presents the fair value and classification of the Company’s derivative financial instruments on the consolidated balance sheets at June 30, 2014 and December 31, 2013, and the effect of the Company’s derivative financial instruments on the consolidated statements of income for the three months and six months endedJune 30, 2014 and June 30, 2013. Asset derivatives and liability derivatives are included in other assets and accrued expenses and other liabilities on the consolidated balance sheets, respectively. Changes in the fair value are recognized directly in earnings and are included in other non-interest income in the consolidated statements of income.

	At June 30, 2014				At December 31, 2013
	Asset Derivatives		Liability Derivatives		Asset Derivatives		Liability Derivatives
	(In Thousands)
Total derivatives (interest-rate products) not designated as hedging instruments	$	887	$	912	$	825	$	856

	Three Months Ended June 30,					Six Months Ended June 30,
	2014		2013			2014	2013
	(In Thousands)
Gain (loss) recognized in income on derivatives (1)	$	4	$	(22	)	6	$	(25	)

(1) The amount of gain (loss) recognized in income on derivatives represents changes related to the fair value of the interest rate products.

By using derivative financial instruments, the Company exposes itself to credit risk which is the risk of failure by the counterparty to perform under the terms of the derivative contract. When the fair value of a derivative contract is positive, the counterparty owes the Company, which creates credit risk for the Company. When the fair value of a derivative is negative, the Company owes the counterparty and, therefore, it does not possess credit risk. The credit risk in derivative instruments is mitigated by entering into transactions with highly-rated counterparties that management believes to be creditworthy and by limiting the amount of exposure to each counterparty. The Company had limited exposure relating to interest rate swaps with institutional counterparties at June 30, 2014 and December 31, 2013, as all such swaps were in a net liability position and subject to master netting agreements.

The estimated net credit risk exposure for derivative financial instruments was $25.3 thousand and $31.2 thousand at June 30, 2014 and December 31, 2013, respectively.

Certain of the derivative agreements contain provisions that require the Company to post collateral if the derivative exposure exceeds a threshold amount. The Company has posted collateral of $2.8 million in the normal course of business at both June 30, 2014 and December 31, 2013.

The tables below present the offsetting of derivatives and amounts subject to master netting agreements not offset in the unaudited consolidated balance sheet at the dates indicated.

	At June 30, 2014
	Gross Amounts of Recognized Assets /Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets Presented in the Statement of Financial Position		Gross Amounts Not Offset in the Statement of Financial Position				Net Amount
							Financial Instruments		Cash Collateral (Received)/ Posted
	(In Thousands)
Asset Derivatives	$	887	$	—	$	887	$	—	$	—	$	887
Liability Derivatives	$	912	$	—	$	912	$	—	$	2,770	$	3,682

	At December 31, 2013
	Gross Amounts of Recognized Assets /Liabilities		Gross Amounts Offset in the Statement of Financial Position		Net Amounts of Assets Presented in the Statement of Financial Position		Gross Amounts Not Offset in the Statement of Financial Position				Net Amount
							Financial Instruments		Cash Collateral (Received) / Posted
	(In Thousands)
Asset Derivatives	$	825	$	—	$	825	$	—	$	—	$	825
Liability Derivatives	$	856	$	—	$	856	$	—	$	2,811	$	3,667

The Company has agreements with certain of its derivative counterparties that contain credit-risk-related contingent

provisions. These provisions provide the counterparty with the right to terminate its derivative positions and require the

Company to settle its obligations under the agreements if the Company defaults on certain of its indebtedness or if the

Company fails to maintain its status as a well-capitalized institution.

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Document and Entity Information	6 Months Ended
	Jun. 30, 2014	Aug. 08, 2014
Document and Entity Information
Entity Registrant Name	BROOKLINE BANCORP INC
Entity Central Index Key	0001049782
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Current Reporting Status	Yes
Document Type	10-Q
Document Period End Date	Jun. 30, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		70,015,431

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Stock Based Compensation

6 Months Ended

Jun. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Based Compensation

Stock Based Compensation

As of June 30, 2014, the Company had two active recognition and retention plans: the 2003 Recognition and Retention Plan (the "2003 RRP") with 1,250,000 authorized shares and the 2011 Restricted Stock Award Plan ("2011 RSA") with 500,000 authorized shares. On July 9, 2014, the Company registered the 2014 Equity Incentive Plan ("2014 Plan" and with the 2003 RRP and the 2011 RSA, collectively referred to as the "Plans") with 1,750,000 authorized shares. The purpose of the Plans is to promote the long-term financial success of the Company and its subsidiaries by providing a means to attract, retain and reward individuals who contribute to such success and to further align their interests with those of the Company's stockholders.

Of the awarded shares, 50% vest ratably over three years with one-third of such shares vesting at each of the first, second and third anniversary dates of the awards. These are referred to as "time-based shares". The remaining 50% of each award has a cliff vesting schedule and will vest three years after the award date based on the level of the Company's achievement of identified performance targets in comparison to the level of achievement of such identified performance targets by a defined peer group comprised of 22 financial institutions. These are referred to as "performance-based shares". The specific performance measure targets relate to return on assets, return on equity, asset quality and total return to stockholders (share price appreciation from date of award plus dividends paid as a percent of the Company's common stock share price on the date of award). If a participant leaves the Company prior to the third anniversary date of an award, any unvested shares will be forfeited. Dividends declared with respect to shares awarded will be held by the Company and paid to the participant only when the shares vest.

Under all the Plans, shares of the Company's common stock were reserved for issuance as restricted stock awards to officers, employees, and non-employee directors of the Company. Shares issued upon vesting may be either authorized but unissued shares or reacquired shares held by the Company as treasury shares. Any shares not issued because vesting requirements are not met will again be available for issuance under the Plans.

Total expense for the Plans was $0.6 million and $0.5 million for the six months endedJune 30, 2014 and 2013, respectively.

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Unaudited Consolidated Statements of Income (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Interest and dividend income:
Loans and leases	$ 50,433	$ 50,644	$ 102,375	$ 100,063
Debt securities	2,360	1,934	4,619	3,786
Marketable and restricted equity securities	539	303	988	612
Short-term investments	14	19	58	50
Total interest and dividend income	53,346	52,900	108,040	104,511
Interest expense:
Deposits	4,201	4,743	8,492	9,578
Borrowed funds	2,711	2,794	5,380	5,903
Total interest expense	6,912	7,537	13,872	15,481
Net interest income	46,434	45,363	94,168	89,030
Provision for credit losses	2,276	2,439	4,719	4,294
Net interest income after provision for credit losses	44,158	42,924	89,449	84,736
Non-interest income:
Deposit fees	2,204	1,929	4,163	3,995
Loan fees	124	386	560	807
Loss from investments in affordable housing projects	(539)	(624)	(1,043)	(936)
Loss on sales of securities, net	(13)	0	(13)	0
Gain on sales of loans and leases held-for-sale	54	183	656	481
(Loss)/Gain on sale/disposals of premises and equipment, net	(6)	(21)	1,504	(21)
Other	1,466	1,286	2,587	2,140
Total non-interest income	3,290	3,139	8,414	6,466
Non-interest expense:
Compensation and employee benefits	17,295	16,697	35,327	32,994
Occupancy	3,154	2,865	7,559	5,948
Equipment and data processing	4,348	4,262	8,725	8,362
Professional services	1,487	1,513	3,214	3,014
FDIC insurance	847	936	1,707	1,870
Advertising and marketing	776	768	1,441	1,438
Amortization of identified intangible assets	827	1,177	1,688	2,342
Other	2,488	2,598	5,137	5,617
Total non-interest expense	31,222	30,816	64,798	61,585
Income before provision for income taxes	16,226	15,247	33,065	29,617
Provision for income taxes	5,774	5,382	11,769	10,511
Net income before noncontrolling interest in subsidiary	10,452	9,865	21,296	19,106
Less net income attributable to noncontrolling interest in subsidiary	476	375	898	802
Net income attributable to Brookline Bancorp, Inc.	$ 9,976	$ 9,490	$ 20,398	$ 18,304
Earnings per common share:
Basic (in dollars per share)	$ 0.14	$ 0.14	$ 0.29	$ 0.26
Diluted (in dollars per share)	$ 0.14	$ 0.14	$ 0.29	$ 0.26
Weighted average common shares outstanding during the period:
Basic (in shares)	69,886,576	69,774,703	69,881,055	69,768,777
Diluted (in shares)	70,012,377	69,833,541	69,998,219	69,823,615
Dividends declared per common share (in dollars per share)	$ 0.085	$ 0.085	$ 0.17	$ 0.17

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Loans and Leases

6 Months Ended

Jun. 30, 2014

Receivables [Abstract]

Loans and Leases

Loans and Leases

The following tables present loan and lease balances and weighted average coupon rates for the originated and acquired loan and lease portfolios at the dates indicated:

	At June 30, 2014
	Originated				Acquired				Total
	Balance		Weighted Average Coupon		Balance		Weighted Average Coupon		Balance		Weighted Average Coupon
	(Dollars in Thousands)
Commercial real estate loans:
Commercial real estate mortgage	$	1,229,783	4.29	%	$	315,700	4.38	%	$	1,545,483	4.31	%
Multi-family mortgage	562,072		4.12	%	69,299		4.54	%	631,371		4.17	%
Construction	125,940		3.87	%	11,791		4.43	%	137,731		3.92	%
Total commercial real estate loans	1,917,795		4.21	%	396,790		4.41	%	2,314,585		4.25	%
Commercial loans and leases:
Commercial	370,813		3.70	%	108,043		4.39	%	478,856		3.86	%
Equipment financing	534,261		6.97	%	18,228		6.35	%	552,489		6.95	%
Condominium association	45,608		4.68	%	—		—	%	45,608		4.68	%
Total commercial loans and leases	950,682		5.58	%	126,271		4.67	%	1,076,953		5.48	%
Indirect automobile loans	376,314		4.62	%	—		—	%	376,314		4.62	%
Consumer loans:
Residential mortgage	442,551		3.62	%	108,263		3.86	%	550,814		3.67	%
Home equity	155,122		3.39	%	115,081		3.86	%	270,203		3.59	%
Other consumer	14,343		4.51	%	701		14.87	%	15,044		5.00	%
Total consumer loans	612,016		3.58	%	224,045		3.90	%	836,061		3.67	%
Total loans and leases	$	3,856,807	4.49	%	$	747,106	4.29	%	$	4,603,913	4.45	%

	At December 31, 2013
	Originated				Acquired				Total
	Balance		Weighted Average Coupon		Balance		Weighted Average Coupon		Balance		Weighted Average Coupon
	(Dollars in Thousands)
Commercial real estate loans:
Commercial real estate mortgage	$	1,111,750	4.34	%	$	350,235	4.42	%	$	1,461,985	4.36	%
Multi-family mortgage	554,555		4.19	%	73,378		4.63	%	627,933		4.24	%
Construction	102,927		3.81	%	10,778		4.37	%	113,705		3.87	%
Total commercial real estate loans	1,769,232		4.26	%	434,391		4.46	%	2,203,623		4.30	%
Commercial loans and leases:
Commercial	297,684		3.68	%	110,108		4.54	%	407,792		3.91	%
Equipment financing	485,330		7.14	%	27,694		6.60	%	513,024		7.11	%
Condominium association	44,794		4.74	%	—		—	%	44,794		4.74	%
Total commercial loans and leases	827,808		5.77	%	137,802		4.95	%	965,610		5.65	%
Indirect automobile loans	400,531		4.98	%	—		—	%	400,531		4.98	%
Consumer loans:
Residential mortgage	411,554		3.65	%	116,631		3.93	%	528,185		3.71	%
Home equity	132,396		3.39	%	125,065		3.88	%	257,461		3.63	%
Other consumer	5,532		5.98	%	1,523		14.89	%	7,055		7.90	%
Total consumer loans	549,482		3.61	%	243,219		3.98	%	792,701		3.72	%
Total loans and leases	$	3,547,053	4.59	%	$	815,412	4.38	%	$	4,362,465	4.55	%

The Company lends primarily in the eastern half of Massachusetts, southern New Hampshire and Rhode Island, with the exception of equipment financing, 36.9% of which is in the greater New York/New Jersey metropolitan area and 63.1% of which is in other areas in the United States of America.

Accretable Yield for the Acquired Loan Portfolio

The following table summarizes activity in the accretable yield for the acquired loan portfolio for the periods indicated:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands)
Balance at beginning of period	$	42,501		$	53,815		$	45,789		$	57,812
Reclassification from nonaccretable difference for loans with improved cash flows	214			3,180			1,654			5,376
Accretion	(4,537		)	(4,813		)	(9,265		)	(11,006		)
Balance at end of period	$	38,178		$	52,182		$	38,178		$	52,182

On a quarterly basis, subsequent to acquisition, management reforecasts the expected cash flows for acquired ASC 310-30 loans, taking into account prepayment speeds, probability of default and loss given defaults. Management compares cash flow projections per the reforecast to the original cash flow projections and determines whether any reduction in cash flow expectations are due to credit deterioration, or if the change in cash flow is related to noncredit events. This cash flow analysis is used to evaluate the need for a loan loss provision and/or prospective yield adjustments. During the six months endedJune 30, 2014 and 2013, accretable yield adjustments totaling $1.7 million and $5.4 million, respectively, were made for certain loan pools. These prospective accretable yield adjustments, which are subject to continued re-assessment, will be recognized over the remaining lives of those pools.

The aggregate remaining nonaccretable difference (representing both principal and interest) applicable to acquired loans and leases totaled $4.6 million and $6.1 million at June 30, 2014 and December 31, 2013, respectively.

Related Party Loans

The Banks’ authority to extend credit to their respective directors and executive officers, as well as to entities controlled by such persons, is currently governed by the requirements of the Sarbanes-Oxley Act of 2002 and Regulation O of the FRB. Among other things, these provisions require that extensions of credit to insiders (1) be made on terms that are substantially the same as, and follow credit underwriting procedures that are not less stringent than, those prevailing for comparable transactions with unaffiliated persons and that do not involve more than the normal risk of repayment or present other unfavorable features; and (2) not exceed certain limitations on the amount of credit extended to such persons, individually and in the aggregate, which limits are based, in part, on the amount of the Banks’ capital. In addition, the extensions of credit to insiders must be approved by each Bank’s Board of Directors.

The following table summarizes the change in the total amounts of loans and advances, to directors, executive officers and their affiliates for the periods indicated. All loans were performing at June 30, 2014 and December 31, 2013.

	Six Months Ended June 30,
	2014			2013
	(In Thousands)
Balance at beginning of period	$	16,110		$	4,083
New loans granted during the period	1,740			100
Advances on lines of credit	1,451			91
Repayments	(522		)	(349		)
Loans no longer classified as related party loans	(978		)	545
Balance at end of period	$	17,801		$	4,470

Unfunded commitments on extensions of credit to insiders totaled $10.4 million and $11.7 million at June 30, 2014 and December 31, 2013, respectively.

Loans and Leases Pledged as Collateral

At June 30, 2014 and December 31, 2013, respectively, $1.5 billion and $1.2 billion of loans and leases were pledged as collateral for wholesale borrowing.

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Investment Securities

6 Months Ended

Jun. 30, 2014

Investments, Debt and Equity Securities [Abstract]

Investment Securities

Investment Securities

The following tables set forth investment securities available-for-sale and held-to-maturity at the dates indicated:

	At June 30, 2014
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(In Thousands)
Debt securities:
GSEs	$	15,968	$	21	$	11	$	15,978
GSE CMOs	254,863		146		7,462		247,547
GSE MBSs	220,848		2,559		1,560		221,847
SBA commercial loan asset-backed securities	227		—		1		226
Corporate debt obligations	39,759		582		11		40,330
Trust preferred securities	1,462		—		163		1,299
Total debt securities	533,127		3,308		9,208		527,227
Marketable equity securities	1,264		96		1		1,359
Total investment securities available-for-sale	$	534,391	$	3,404	$	9,209	$	528,586
Investment securities held-to-maturity	$	500	$	—	$	—	$	500

	At December 31, 2013
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(In Thousands)
Debt securities:
GSEs	$	12,138	$	42	$	—	$	12,180
GSE CMOs	254,331		86		10,773		243,644
GSE MBSs	202,478		1,852		4,929		199,401
Private-label CMOs	3,258		115		18		3,355
SBA commercial loan asset-backed securities	245		—		2		243
Auction-rate municipal obligations	1,900		—		125		1,775
Municipal obligations	1,068		18		—		1,086
Corporate debt obligations	27,751		506		33		28,224
Trust preferred securities	1,461		—		251		1,210
Total debt securities	504,630		2,619		16,131		491,118
Marketable equity securities	1,259		61		10		1,310
Total investment securities available-for-sale	$	505,889	$	2,680	$	16,141	$	492,428
Investment securities held-to-maturity	$	500	$	—	$	—	$	500

At June 30, 2014, the fair value of all securities available-for-sale was $528.6 million, with net unrealized losses of $5.8 million, compared to a fair value of $492.4 million and net unrealized losses of $13.5 million at December 31, 2013. At June 30, 2014, $344.5 million, or 65.2%, of the portfolio, had gross unrealized losses, compared to $383.3 million, or 77.8%, at December 31, 2013. The total gross unrealized loss at June 30, 2014 was $9.2 million, as compared to $16.1 million at December 31, 2013.

Investment Securities as Collateral

At June 30, 2014 and December 31, 2013, respectively, $392.9 million and $402.5 million of investment securities available-for-sale were pledged as collateral for repurchase agreements; municipal deposits; treasury, tax and loan deposits; swap agreements; and Federal Home Loan Bank of Boston (“FHLBB”) borrowings.

Other-Than-Temporary Impairment (“OTTI”)

Investment securities at June 30, 2014 and December 31, 2013 that have been in a continuous unrealized loss position for less than twelve months or twelve months or longer are as follows:

	At June 30, 2014
	Less than Twelve Months				Twelve Months or Longer				Total
	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
	(In Thousands)
Debt securities:
GSEs	$	1,963	$	11	$	—	$	—	$	1,963	$	11
GSE CMOs	38,406		839		196,095		6,623		234,501		7,462
GSE MBSs	12,323		51		89,592		1,509		101,915		1,560
SBA commercial loan asset-backed securities	31		—		176		1		207		1
Corporate debt obligations	4,067		11		—		—		4,067		11
Trust preferred securities	—		—		1,299		163		1,299		163
Temporarily impaired debt securities	56,790		912		287,162		8,296		343,952		9,208
Marketable equity securities	511		1		—		—		511		1
Total temporarily impaired investment securities	$	57,301	$	913	$	287,162	$	8,296	$	344,463	$	9,209

	At December 31, 2013
	Less than Twelve Months				Twelve Months or Longer				Total
	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
	(In Thousands)
Debt securities:
GSE CMOs	$	221,317	$	9,861	$	16,257	$	912	$	237,574	$	10,773
GSE MBSs	121,836		3,746		13,516		1,183		135,352		4,929
Private-label CMOs	639		18		—		—		639		18
SBA commercial loan asset-backed securities	32		—		192		2		224		2
Auction-rate municipal obligations	—		—		1,775		125		1,775		125
Corporate debt obligations	5,988		33		—		—		5,988		33
Trust preferred securities	—		—		1,210		251		1,210		251
Temporarily impaired debt securities	349,812		13,658		32,950		2,473		382,762		16,131
Marketable equity securities	501		10		—		—		501		10
Total temporarily impaired investment securities	$	350,313	$	13,668	$	32,950	$	2,473	$	383,263	$	16,141

The Company performs regular analysis on the available-for-sale investment securities portfolio to determine whether a decline in fair value indicates that an investment is OTTI. In making these OTTI determinations, management considers, among other factors, the length of time and extent to which the fair value has been less than amortized cost; projected future cash flows; credit subordination and the creditworthiness, capital adequacy and near-term prospects of the issuers.

Management also considers the Company’s capital adequacy, interest-rate risk, liquidity and business plans in assessing whether it is more likely than not that the Company will sell or be required to sell the securities before recovery. If the Company determines that a decline in fair value is OTTI and that it is more likely than not that the Company will not sell or be required to sell the security before recovery of its amortized cost, the credit portion of the impairment loss is recognized in earnings and the noncredit portion is recognized in accumulated other comprehensive income. The credit portion of the OTTI impairment represents the difference between the amortized cost and the present value of the expected future cash flows of the security. If the Company determines that a decline in fair value is OTTI and it is more likely than not that it will sell or be required to sell the security before recovery of its amortized cost, the entire difference between the amortized cost and the fair value of the security will be recognized in earnings.

At June 30, 2014, it is more likely than not that the Company will not sell or be required to sell the securities before recovery of its amortized cost. The Company's ability and intent to hold these securities until recovery is supported by the Company's strong capital and liquidity positions as well as its historically low portfolio turnover. As such, management has determined that the securities are not OTTI at June 30, 2014. If market conditions for securities worsen or the creditworthiness of the underlying issuers deteriorates, it is possible that the Company may recognize additional OTTI in future periods.

Debt Securities

U.S. Government-Sponsored Enterprises

The Company invests in securities issued by U.S. Government-sponsored enterprises (“GSEs”), including GSE debt securities, mortgage-backed securities (“MBSs”), and collateralized mortgage obligations (“CMOs”). GSE securities include obligations issued by the Federal National Mortgage Association (“FNMA”), the Federal Home Loan Mortgage Corporation (“FHLMC"), the Government National Mortgage Association (“GNMA”), the Federal Home Loan Banks ("FHLB") and the Federal Farm Credit Bank. At June 30, 2014, only GNMA MBSs and CMOs, and Small Business Administration (“SBA”) commercial loan asset-backed securities with an estimated fair value of $25.4 million were backed explicitly by the full faith and credit of the U.S. Government, compared to $18.9 million at December 31, 2013.

At June 30, 2014, the Company held GSE debentures with a total fair value of $16.0 million and a net unrealized gain of $10.0 thousand. At December 31, 2013, the Company held GSE debentures with a total fair value of $12.2 million and a net unrealized gain of $42.0 thousand. At June 30, 2014, one of the six securities in this portfolio were in unrealized loss positions. At December 31, 2013, none of the five securities in this portfolio was in unrealized loss positions. All securities are performing and backed by the implicit (FHLB / FNMA / FHLMC) or explicit (GNMA / SBA) guarantee of the U.S. Government. During the six months endedJune 30, 2014, the Company purchased $2.0 million in GSE debentures. The Company did not purchase any GSE debentures in the same period in 2013.

At June 30, 2014, the Company held GSE mortgage-related securities with a total fair value of $469.4 million and a net unrealized loss of $6.3 million. This compares to a total fair value of $443.0 million and a net unrealized loss of $13.8 million at December 31, 2013. At June 30, 2014, 96 of the 241 securities in this portfolio were in unrealized loss positions, compared to 86 of the 232 securities at December 31, 2013. All securities are performing and backed by the implicit (FHLB / FNMA / FHLMC) or explicit (GNMA) guarantee of the U.S. Government. During the six months endedJune 30, 2014, the Company purchased $55.1 million in GSE CMOs and GSE MBSs to reinvest cash from matured securities. This compares to a total of $82.3 million during the same period in 2013.

SBA Commercial Loan Asset-Backed

At both June 30, 2014 and December 31, 2013, the Company held nine SBA securities with a total fair value of $0.2 million which approximated amortized cost. At both June 30, 2014 and December 31, 2013, seven of the nine securities in this portfolio were in unrealized loss positions. All securities are performing and backed by the explicit (SBA) guarantee of the U.S. Government.

Private-Label CMOs

At June 30, 2014, the Company held no private-issuer CMO-related securities. All private-label CMOs were sold during the second quarter of 2014. At December 31, 2013, the Company held private-issuer CMO-related securities with a total fair value of $3.4 million and a net unrealized gain of $0.1 million. At December 31, 2013, two of the eleven securities in this portfolio were in unrealized loss positions.

Auction-Rate Municipal Obligations and Municipal Obligations

The auction-rate obligations owned by the Company were rated “AAA” at the time of acquisition due, in part, to the guarantee of third-party insurers who would have to pay the obligations if the issuers failed to pay the obligations when they become due. During the financial crisis, certain third-party insurers experienced financial difficulties and were not able to meet their contractual obligations. As a result, auctions failed to attract a sufficient number of investors and created a liquidity problem for those investors who were relying on the obligations to be redeemed at auction. Since then, there has not been an active market for auction-rate municipal obligations.

At June 30, 2014, the Company held no auction-rate municipal obligations. All auction-rate municipal obligations were sold during the second quarter of 2014. This compares to an estimated fair value of $1.8 million, with a corresponding net unrealized loss of $0.1 million at December 31, 2013. At December 31, 2013, all of the securities in this portfolio were in unrealized loss positions.

The Company owns no municipal obligations at June 30, 2014. All municipal obligations were sold during the second quarter of 2014. This compares to a total fair value of $1.1 million which also approximated amortized cost at December 31, 2013. At December 31, 2013, none of the securities in this portfolio was in unrealized loss position.

Corporate Obligations

From time to time, the Company will invest in high-quality corporate obligations to provide portfolio diversification and improve the overall yield on the portfolio. The Company owned thirteen corporate obligation securities with a total fair value of $40.3 million and total net unrealized gains of $0.6 million at June 30, 2014. This compares to eleven corporate obligation securities with a total fair value of $28.2 million and total net unrealized gains of $0.5 million at December 31, 2013. At June 30, 2014, one of the thirteen securities in this portfolio were in unrealized loss positions. At December 31, 2013, two of the eleven securities in this portfolio are in unrealized loss positions. Full collection of the obligations is expected because the financial condition of the issuers is sound, none of the issuers has defaulted on scheduled payments, the obligations are rated investment grade and the Company has the ability and intent to hold the obligations for a period of time to recover the amortized cost. During the six months endedJune 30, 2014, the Company purchased $12.0 million in corporate obligations. The Company did not purchase any corporate obligations in the same period in 2013.

Trust Preferred Securities

Trust preferred securities represent subordinated debt issued by financial institutions. At June 30, 2014, the Company owned two trust preferred securities with a total fair value of $1.3 million and total net unrealized loss of $0.2 million. This compares to two trust preferred securities with a total fair value of $1.2 million and a total net unrealized loss of $0.3 million at December 31, 2013. At June 30, 2014 and December 31, 2013, both of the securities in this portfolio were in unrealized loss positions. Full collection of the obligations is expected because the financial condition of the issuers is sound, none of the issuers has defaulted on scheduled payments, the obligations are rated investment grade and the Company has the ability and intent to hold the obligations for a period of time to recover the amortized cost.

Marketable Equity Securities

At June 30, 2014, the Company owned marketable equity securities with a fair value of $1.4 million, including net unrealized gains of $0.1 million. This compares to a fair value of $1.3 million and net unrealized gains of $0.1 million at December 31, 2013. At both June 30, 2014 and December 31, 2013, one out of the four securities in this portfolio was in an unrealized loss position.

Investment Securities Held-to-Maturity

At June 30, 2014, the Company owned a held-to-maturity investment security with a carrying value of $0.5 million and a fair value of $0.5 million. This security matures in March 2016 and carries an interest rate payable of 1.3%.

Portfolio Maturities

The maturities of the investments in debt securities are as follows at the dates indicated:

	At June 30, 2014						At December 31, 2013
	Amortized Cost		Estimated Fair Value		Weighted Average Rate		Amortized Cost		Estimated Fair Value		Weighted Average Rate
	(Dollars in Thousands)
Investment securities available-for-sale:
Within 1 year	$	12,343	$	12,370	0.67	%	$	13,012	$	13,062	0.82	%
After 1 year through 5 years	52,908		54,177		2.64	%	40,204		41,187		2.90	%
After 5 years through 10 years	85,907		87,009		1.97	%	66,447		67,075		2.23	%
Over 10 years	381,969		373,671		1.91	%	384,967		369,794		1.90	%
	$	533,127	$	527,227	1.96	%	$	504,630	$	491,118	2.00	%
Investment securities held-to-maturity:
Within 1 year	$	—	$	—	—	%	$	500	$	500	1.99	%
After 1 year through 5 years	500		500		1.30	%	—		—		—	%
After 5 years through 10 years	—		—		—	%	—		—		—	%
Over 10 years	—		—		—	%	—		—		—	%
	$	500	$	500	1.30	%	$	500	$	500	1.99	%

Actual maturities of debt securities may differ from those presented above since certain obligations provide the issuer the right to call or prepay the obligation prior to scheduled maturity without penalty. At June 30, 2014, issuers of debt securities with an estimated fair value of $5.2 million had the right to call or prepay the obligations. Of the $5.2 million, $2.0 million matures in 1 - 5 years, $1.9 million matures in 6 - 10 years and $1.3 million matures after ten years. At December 31, 2013, issuers of debt securities with an estimated fair value of $3.7 million had the right to call or prepay the obligations. Of the $3.7 million$0.7 million matures in less than one year and $3.0 million matures after ten years. MBSs and CMOs are included above based on their contractual maturities; the remaining lives, however, are expected to be shorter due to anticipated prepayments.

Security Sales

When securities are sold, the adjusted cost of the specific security sold is used to compute the gain or loss on the sale. The following table shows the gross realized gains and losses on available for sale securities for the periods indicated:

	Three Months Ended June 30, 2014			Six Months Ended June 30, 2014
	(In Thousands)
Sales of debt securities	$	5,083		$	5,083
Gross gains from sales	302			302
Gross losses from sales	315			315
Loss on sales of securities, net	$	(13	)	$	(13	)

There were no security sales during the three and six-month periods ended June 30, 2013.

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Investment Securities (Tables)

6 Months Ended

Jun. 30, 2014

Investments, Debt and Equity Securities [Abstract]

Schedule of securities available-for-sale securities

The following tables set forth investment securities available-for-sale and held-to-maturity at the dates indicated:

	At June 30, 2014
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(In Thousands)
Debt securities:
GSEs	$	15,968	$	21	$	11	$	15,978
GSE CMOs	254,863		146		7,462		247,547
GSE MBSs	220,848		2,559		1,560		221,847
SBA commercial loan asset-backed securities	227		—		1		226
Corporate debt obligations	39,759		582		11		40,330
Trust preferred securities	1,462		—		163		1,299
Total debt securities	533,127		3,308		9,208		527,227
Marketable equity securities	1,264		96		1		1,359
Total investment securities available-for-sale	$	534,391	$	3,404	$	9,209	$	528,586
Investment securities held-to-maturity	$	500	$	—	$	—	$	500

	At December 31, 2013
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(In Thousands)
Debt securities:
GSEs	$	12,138	$	42	$	—	$	12,180
GSE CMOs	254,331		86		10,773		243,644
GSE MBSs	202,478		1,852		4,929		199,401
Private-label CMOs	3,258		115		18		3,355
SBA commercial loan asset-backed securities	245		—		2		243
Auction-rate municipal obligations	1,900		—		125		1,775
Municipal obligations	1,068		18		—		1,086
Corporate debt obligations	27,751		506		33		28,224
Trust preferred securities	1,461		—		251		1,210
Total debt securities	504,630		2,619		16,131		491,118
Marketable equity securities	1,259		61		10		1,310
Total investment securities available-for-sale	$	505,889	$	2,680	$	16,141	$	492,428
Investment securities held-to-maturity	$	500	$	—	$	—	$	500

Investment securities in a continuous unrealized loss position

Investment securities at June 30, 2014 and December 31, 2013 that have been in a continuous unrealized loss position for less than twelve months or twelve months or longer are as follows:

	At June 30, 2014
	Less than Twelve Months				Twelve Months or Longer				Total
	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
	(In Thousands)
Debt securities:
GSEs	$	1,963	$	11	$	—	$	—	$	1,963	$	11
GSE CMOs	38,406		839		196,095		6,623		234,501		7,462
GSE MBSs	12,323		51		89,592		1,509		101,915		1,560
SBA commercial loan asset-backed securities	31		—		176		1		207		1
Corporate debt obligations	4,067		11		—		—		4,067		11
Trust preferred securities	—		—		1,299		163		1,299		163
Temporarily impaired debt securities	56,790		912		287,162		8,296		343,952		9,208
Marketable equity securities	511		1		—		—		511		1
Total temporarily impaired investment securities	$	57,301	$	913	$	287,162	$	8,296	$	344,463	$	9,209

	At December 31, 2013
	Less than Twelve Months				Twelve Months or Longer				Total
	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
	(In Thousands)
Debt securities:
GSE CMOs	$	221,317	$	9,861	$	16,257	$	912	$	237,574	$	10,773
GSE MBSs	121,836		3,746		13,516		1,183		135,352		4,929
Private-label CMOs	639		18		—		—		639		18
SBA commercial loan asset-backed securities	32		—		192		2		224		2
Auction-rate municipal obligations	—		—		1,775		125		1,775		125
Corporate debt obligations	5,988		33		—		—		5,988		33
Trust preferred securities	—		—		1,210		251		1,210		251
Temporarily impaired debt securities	349,812		13,658		32,950		2,473		382,762		16,131
Marketable equity securities	501		10		—		—		501		10
Total temporarily impaired investment securities	$	350,313	$	13,668	$	32,950	$	2,473	$	383,263	$	16,141

Schedule of maturities of the investments in debt securities

The maturities of the investments in debt securities are as follows at the dates indicated:

	At June 30, 2014						At December 31, 2013
	Amortized Cost		Estimated Fair Value		Weighted Average Rate		Amortized Cost		Estimated Fair Value		Weighted Average Rate
	(Dollars in Thousands)
Investment securities available-for-sale:
Within 1 year	$	12,343	$	12,370	0.67	%	$	13,012	$	13,062	0.82	%
After 1 year through 5 years	52,908		54,177		2.64	%	40,204		41,187		2.90	%
After 5 years through 10 years	85,907		87,009		1.97	%	66,447		67,075		2.23	%
Over 10 years	381,969		373,671		1.91	%	384,967		369,794		1.90	%
	$	533,127	$	527,227	1.96	%	$	504,630	$	491,118	2.00	%
Investment securities held-to-maturity:
Within 1 year	$	—	$	—	—	%	$	500	$	500	1.99	%
After 1 year through 5 years	500		500		1.30	%	—		—		—	%
After 5 years through 10 years	—		—		—	%	—		—		—	%
Over 10 years	—		—		—	%	—		—		—	%
	$	500	$	500	1.30	%	$	500	$	500	1.99	%

Schedule of security sales

	Three Months Ended June 30, 2014			Six Months Ended June 30, 2014
	(In Thousands)
Sales of debt securities	$	5,083		$	5,083
Gross gains from sales	302			302
Gross losses from sales	315			315
Loss on sales of securities, net	$	(13	)	$	(13	)

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Earnings per Share

6 Months Ended

Jun. 30, 2014

Earnings Per Share [Abstract]

Earnings per Share

Earnings per Share

The following table sets forth a reconciliation of basic and diluted earnings per share (“EPS”) for the periods indicated:

	Three Months Ended
	June 30, 2014				June 30, 2013
	Basic		Fully Diluted		Basic		Fully Diluted
	(In Thousands Except Share Data)
Numerator:
Net income	$	9,976	$	9,976	$	9,490	$	9,490
Denominator:
Weighted average shares outstanding	69,886,576		69,886,576		69,774,703		69,774,703
Effect of dilutive securities	—		125,801		—		58,838
Adjusted weighted average shares outstanding	69,886,576		70,012,377		69,774,703		69,833,541
EPS	$	0.14	$	0.14	$	0.14	$	0.14

	Six Months Ended
	June 30, 2014				June 30, 2013
	Basic		Fully Diluted		Basic		Fully Diluted
	(In Thousands Except Share Data)
Numerator:
Net income	$	20,398	$	20,398	$	18,304	$	18,304
Denominator:
Weighted average shares outstanding	69,881,055		69,881,055		69,768,777		69,768,777
Effect of dilutive securities	—		117,164		—		54,838
Adjusted weighted average shares outstanding	69,881,055		69,998,219		69,768,777		69,823,615
EPS	$	0.29	$	0.29	$	0.26	$	0.26

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Goodwill and Other Intangible Assets

6 Months Ended

Jun. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

The following table sets forth the composition of goodwill and other intangible assets at the dates indicated:

	At June 30, 2014		At December 31, 2013
	(In Thousands)
Goodwill	$	137,890	$	137,890
Other intangible assets:
Core deposits	14,110		15,777
Trade name	1,089		1,089
Trust relationship	—		21
Total other intangible assets	15,199		16,887
Total goodwill and other intangible assets	$	153,089	$	154,777

As of December 31, 2013, the Company has concluded that the BankRI name will continue to be utilized in its marketing strategies; therefore, the trade name with a carrying value of $1.1 million has an indefinite life and ceased to amortize.  

The estimated aggregate future amortization expense (in thousands) for intangible assets with a finite life remaining at June 30, 2014 is as follows:

Remainder of 2014	$	1,436
Year ending:
2015	2,868
2016	2,457
2017	1,858
2018	1,836
Thereafter	3,655
Total	$	14,110

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Fair Value of Financial Instruments (Details 3) (Level 3, Appraisal of Collateral [Member], USD $) In Thousands, unless otherwise specified	Jun. 30, 2014
Collateral-dependent impaired loans and leases
Quantitative information for Level 3 Fair Value Measurements Assets
Fair value Assets	$ 4,927	[1]
Other real estate owned
Quantitative information for Level 3 Fair Value Measurements Assets
Fair value Assets	$ 675	[1]

[1] Fair value is generally determined through independent appraisals of the underlying collateral. The Company may also use another available source of collateral assessment to determine a reasonable estimate of the fair value of the collateral. The valuation generally includes various Level 3 inputs which are not identifiable. Appraisals may be adjusted by management for qualitative factors such as economic factors and estimated liquidation expenses. The range of these possible adjustments may vary.

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Allowance for Loan and Lease Losses

6 Months Ended

Jun. 30, 2014

Receivables [Abstract]

Allowance for Loan and Lease Losses

Allowance for Loan and Lease Losses

The following tables present the changes in the allowance for loan and lease losses and the recorded investment in loans and leases by portfolio segment for the periods indicated:

	Three Months Ended June 30, 2014
	Commercial Real Estate		Commercial			Indirect Automobile			Consumer			Unallocated			Total
	(In Thousands)
Balance at March 31, 2014	$	24,858	$	15,544		$	3,664		$	3,110		$	3,048		$	50,224
Charge-offs	—		(796		)	(228		)	(172		)	—			(1,196		)
Recoveries	—		218			173			85			—			476
Provision (credit) for loan and lease losses	1,857		900			77			(6		)	(646		)	2,182
Balance at June 30, 2014	$	26,715	$	15,866		$	3,686		$	3,017		$	2,402		$	51,686

	Three Months Ended June 30, 2013
	Commercial Real Estate			Commercial			Indirect Automobile			Consumer			Unallocated		Total
	(In Thousands)
Balance at March 31, 2013	$	20,588		$	11,652		$	5,000		$	2,596		$	2,696	$	42,532
Charge-offs	(81		)	(477		)	(318		)	(154		)	—		(1,030		)
Recoveries	—			182			149			60			—		391
Provision (credit) for loan and lease losses	1,512			434			(136		)	497			81		2,388
Balance at June 30, 2013	$	22,019		$	11,791		$	4,695		$	2,999		$	2,777	$	44,281

	Six Months Ended June 30, 2014
	Commercial Real Estate		Commercial			Indirect Automobile			Consumer			Unallocated			Total
	(In Thousands)
Balance at December 31, 2013	$	23,022	$	15,220		$	3,924		$	3,375		$	2,932		$	48,473
Charge-offs	—		(1,347		)	(517		)	(382		)	—			(2,246		)
Recoveries	—		469			277			114			—			860
Provision (credit) for loan and lease losses	3,693		1,524			2			(90		)	(530		)	4,599
Balance at June 30, 2014	$	26,715	$	15,866		$	3,686		$	3,017		$	2,402		$	51,686

	Six Months Ended June 30, 2013
	Commercial Real Estate			Commercial			Indirect Automobile			Consumer			Unallocated		Total
	(In Thousands)
Balance at December 31, 2012	$	20,018		$	10,655		$	5,304		$	2,545		$	2,630	$	41,152
Charge-offs	(81		)	(724		)	(680		)	(206		)	—		(1,691		)
Recoveries	4			264			279			86			—		633
Provision (credit) for loan and lease losses	2,078			1,596			(208		)	574			147		4,187
Balance at June 30, 2013	$	22,019		$	11,791		$	4,695		$	2,999		$	2,777	$	44,281

The liability for unfunded credit commitments, which is included in other liabilities, was $1.2 million, $1.0 million and $0.9 million at June 30, 2014, December 31, 2013 and June 30, 2013, respectively. During the six-month periods ended June 30, 2014 and 2013, the liability for unfunded credit commitments increased by $0.2 million and $0.2 million, respectively, to reflect changes in the estimate of loss exposure associated with credit commitments. No credit commitments were charged off against the liability account in the six-month periods ended June 30, 2014 and 2013.

Provision for Credit Losses

The provisions for credit losses are set forth below for the periods indicated:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands)
Provision (credit) for loan and lease losses:
Commercial real estate	$	1,857		$	1,512		$	3,693		$	2,078
Commercial	900			434			1,524			1,596
Indirect automobile	77			(136		)	2			(208		)
Consumer	(6		)	497			(90		)	574
Unallocated	(646		)	81			(530		)	147
Total provision for loan and lease losses	2,182			2,388			4,599			4,187
Unfunded credit commitments	94			51			120			107
Total provision for credit losses	$	2,276		$	2,439		$	4,719		$	4,294

Procedure for Placing Loans and Leases on Nonaccrual

Accrual of interest on loans generally is discontinued when contractual payment of principal or interest becomes past due 90 days or, if in management’s judgment, reasonable doubt exists as to the full timely collection of interest. Exceptions may be made if the loan has matured and is in the process of renewal or is well-secured and in the process of collection. When a loan is placed on nonaccrual status, interest accruals cease and uncollected accrued interest is reversed and charged against current interest income. Interest payments on nonaccrual loans are applied to principal. Loans are returned to accrual status when principal and interest payments are current, full collectability of principal and interest is reasonably assured and a consistent record of at least six consecutive months of performance has been achieved.

Allowance for Loan and Lease Losses Methodology

Management has established a methodology to determine the adequacy of the allowance for loan and lease losses that assesses the risks and losses inherent in the loan and lease portfolio. For purposes of determining the allowance for loan and lease losses, the Company has segmented certain loans and leases in the portfolio by product type into the following pools: (1) commercial real estate loans, (2) commercial loans and leases, (3) indirect automobile loans and (4) consumer loans. Portfolio segments are further disaggregated into classes based on the associated risks within the segments. Commercial real estate loans are divided into three classes: commercial real estate mortgage loans, multi-family mortgage loans and construction loans. Commercial loans and leases are divided into three classes: commercial loans, equipment financing, and loans to condominium associations. The indirect automobile loan segment is not divided into classes. Consumer loans are divided into three classes: residential mortgage loans, home equity loans and other consumer loans. For each class of loan, management makes significant judgments in selecting the estimation method that fits the credit characteristics of its class and portfolio segment as set forth below.

General Allowance

The general allowance for loan and lease losses was $48.2 million at June 30, 2014, compared to $44.1 million at December 31, 2013. The general portion of the allowance for loan and lease losses increased by $4.1 million during the six months endedJune 30, 2014, in part as a result of growth in the commercial real estate and equipment financing portfolios partially offset by the decrease in the indirect auto portfolio.

Specific Allowance

The specific allowance for loan and lease losses was $1.1 million at June 30, 2014, compared to $1.5 million at December 31, 2013. The specific allowance decreased by $0.4 million during the six months endedJune 30, 2014, largely as a result of improved credit quality and higher collateral value underlying those impaired loans and leases.

Unallocated Allowance

The unallocated allowance for loan and lease losses was $2.4 million at June 30, 2014, compared to $2.9 million at December 31, 2013. The unallocated portion of the allowance for loan and lease losses decreased by $0.5 million during the six months endedJune 30, 2014, largely as the result of improved credit quality and loss history.

Credit Quality Assessment

At the time of loan origination, a rating is assigned based on the financial strength of the borrower and the value of assets pledged as collateral. The Company continually monitors the asset quality of the loan portfolio using all available information. The officer responsible for handling each loan is required to initiate changes to risk ratings when changes in facts and circumstances occur that warrant an upgrade or downgrade in a loan rating. Based on this information, loans demonstrating certain payment issues or other weaknesses may be categorized as delinquent, impaired, nonperforming and/or put on nonaccrual status. Additionally, in the course of resolving such loans, the Company may choose to restructure the contractual terms of certain loans to match the borrower’s ability to repay the loan based on their current financial condition. If a restructured loan meets certain criteria, it may be categorized as a troubled debt restructuring.

The Company reviews numerous credit quality indicators when assessing the risk in its loan portfolio. For the commercial real estate mortgage, multi-family mortgage, construction, commercial, equipment financing, condominium association and other consumer loan and lease classes, the Company utilizes an eight-grade loan rating system, which assigns a risk rating to each borrower based on a number of quantitative and qualitative factors associated with a loan transaction. Factors considered include industry and market conditions; position within the industry; earnings trends; operating cash flow; asset/liability values; debt capacity; guarantor strength; management and controls; financial reporting; collateral; and other considerations. In addition, the Company’s independent loan review group evaluates the credit quality and related risk ratings of the commercial real estate and commercial loan portfolios. The results of these reviews are reported to the Board of Directors. For consumer loans, the Company primarily relies on payment status for monitoring credit risk.

The ratings categories used for assessing credit risk in the commercial real estate mortgage, multi-family mortgage, construction, commercial, equipment financing, condominium association and other consumer loan and lease classes are defined as follows:

1-4 Rating — Pass

Loan rating grades “1” through “4” are classified as “Pass,” which indicates borrowers are performing in accordance with the terms of the loan and are less likely to result in loss due to the capacity of the borrower to pay and the adequacy of the value of assets pledged as collateral.

5 Rating — Other Asset Especially Mentioned (“OAEM”)

Borrowers exhibit potential credit weaknesses or downward trends deserving management’s attention. If not checked or corrected, these trends will weaken the Company’s asset and position. While potentially weak, currently these borrowers are marginally acceptable; no loss of principal or interest is envisioned.

6 Rating — Substandard

Borrowers exhibit well-defined weaknesses that jeopardize the orderly liquidation of debt. Substandard loans may be inadequately protected by the current net worth and paying capacity of the obligors or by the collateral pledged, if any. Normal repayment from the borrower is in jeopardy. Although no loss of principal is envisioned, there is a distinct possibility that a partial loss of interest and/or principal will occur if the deficiencies are not corrected. Collateral coverage may be inadequate to cover the principal obligation.

7 Rating — Doubtful

Borrowers exhibit well-defined weaknesses that jeopardize the orderly liquidation of debt with the added provision that the weaknesses make collection of the debt in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Serious problems exist to the point where partial loss of principal is likely.

8 Rating — Definite Loss

Borrowers deemed incapable of repayment. Loans to such borrowers are considered uncollectable and of such little value that continuation as active assets of the Company is not warranted.

Assets rated as “OAEM,” “substandard” or “doubtful” based on criteria established under banking regulations are collectively referred to as “criticized” assets.

Credit Quality Information

The following tables present the recorded investment in loans in each class at June 30, 2014 by credit quality indicator.

	At June 30, 2014
	Commercial Real Estate Mortgage		Multi- Family Mortgage		Construction		Commercial		Equipment Financing		Condominium Association		Other Consumer
	(In Thousands)
Originated:
Loan rating:
Pass	$	1,220,046	$	561,705	$	125,940	$	359,654	$	529,588	$	45,608	$	14,332
OAEM	8,685		367		—		8,853		1,082		—		—
Substandard	1,052		—		—		1,011		3,002		—		11
Doubtful	—		—		—		1,295		589		—		—
Total originated	1,229,783		562,072		125,940		370,813		534,261		45,608		14,343
Acquired:
Loan rating:
Pass	301,358		63,085		11,523		96,171		18,123		—		689
OAEM	4,569		2,553		268		2,468		33		—		—
Substandard	9,727		3,661		—		9,256		72		—		12
Doubtful	46		—		—		148		—		—		—
Total acquired	315,700		69,299		11,791		108,043		18,228		—		701
Total loans	$	1,545,483	$	631,371	$	137,731	$	478,856	$	552,489	$	45,608	$	15,044

At June 30, 2014, there were no loans categorized as definite loss.

	At June 30, 2014
	Indirect Automobile
	(In Thousands)		(Percent)
Originated:
Credit score:
Over 700	$	312,755	83.1	%
661-700	50,960		13.6	%
660 and below	11,083		2.9	%
Data not available	1,516		0.4	%
Total loans	$	376,314	100.0	%

	At June 30, 2014
	Residential Mortgage				Home Equity
	(In Thousands)		(Percent)		(In Thousands)		(Percent)
Originated:
Loan-to-value ratio:
Less than 50%	$	104,052	18.9	%	$	92,667	34.3	%
50% - 69%	155,284		28.2	%	33,727		12.5	%
70% - 79%	150,649		27.3	%	23,972		8.9	%
80% and over	29,114		5.3	%	3,823		1.4	%
Data not available	3,452		0.6	%	933		0.3	%
Total originated	442,551		80.3	%	155,122		57.4	%
Acquired:
Loan-to-value ratio:
Less than 50%	20,075		3.7	%	76,631		28.4	%
50% - 69%	37,392		6.8	%	24,276		9.0	%
70% - 79%	27,166		4.9	%	11,973		4.4	%
80% and over	19,167		3.5	%	1,483		0.5	%
Data not available	4,463		0.8	%	718		0.3	%
Total acquired	108,263		19.7	%	115,081		42.6	%
Total loans	$	550,814	100.0	%	$	270,203	100.0	%

The following tables present the recorded investment in loans in each class at December 31, 2013 by credit quality indicator.

	At December 31, 2013
	Commercial Real Estate Mortgage		Multi- Family Mortgage		Construction		Commercial		Equipment Financing		Condominium Association		Other Consumer
	(In Thousands)
Originated:
Loan rating:
Pass	$	1,099,108	$	554,183	$	102,927	$	295,057	$	479,811	$	44,793	$	5,528
OAEM	11,555		372		—		49		625		—		—
Substandard	1,087		—		—		1,078		4,817		1		4
Doubtful	—		—		—		1,500		77		—		—
Total originated	1,111,750		554,555		102,927		297,684		485,330		44,794		5,532
Acquired:
Loan rating:
Pass	332,145		69,310		10,090		96,779		27,535		—		1,509
OAEM	7,556		463		688		4,617		61		—		—
Substandard	8,645		3,605		—		8,518		98		—		14
Doubtful	1,889		—		—		194		—		—		—
Total acquired	350,235		73,378		10,778		110,108		27,694		—		1,523
Total loans	$	1,461,985	$	627,933	$	113,705	$	407,792	$	513,024	$	44,794	$	7,055

At December 31, 2013, there were no loans categorized as definite loss.

	At December 31, 2013
	Indirect Automobile
	(In Thousands)		(Percent)
Originated:
Credit score:
Over 700	$	332,140	82.9	%
661-700	54,038		13.5	%
660 and below	12,793		3.2	%
Data not available	1,560		0.4	%
Total loans	$	400,531	100.0	%

	At December 31, 2013
	Residential Mortgage				Home Equity
	(In Thousands)		(Percent)		(In Thousands)		(Percent)
Originated:
Loan-to-value ratio:
Less than 50%	$	94,500	17.9	%	$	75,372	29.3	%
50% - 69%	149,969		28.4	%	31,504		12.2	%
70% - 79%	139,960		26.5	%	21,161		8.2	%
80% and over	22,772		4.3	%	3,240		1.3	%
Data not available	4,353		0.8	%	1,119		0.4	%
Total originated	411,554		77.9	%	132,396		51.4	%
Acquired:
Loan-to-value ratio:
Less than 50%	23,101		4.4	%	84,272		32.7	%
50% - 69%	39,298		7.4	%	25,964		10.1	%
70% - 79%	31,932		6.0	%	13,390		5.2	%
80% and over	19,870		3.8	%	1,208		0.5	%
Data not available	2,430		0.5	%	231		0.1	%
Total acquired	116,631		22.1	%	125,065		48.6	%
Total loans	$	528,185	100.0	%	$	257,461	100.0	%

Age Analysis of Past Due Loans and Leases

The following tables present an age analysis of the recorded investment in total loans and leases at June 30, 2014 and December 31, 2013.

	At June 30, 2014
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Originated:
Commercial real estate loans:
Commercial real estate mortgage	$	—	$	888	$	164	$	1,052	$	1,228,731	$	1,229,783	$	—	$	1,052
Multi-family mortgage	—		—		71		71		562,001		562,072		71		—
Construction	—		—		—		—		125,940		125,940		—		—
Total commercial real estate loans	—		888		235		1,123		1,916,672		1,917,795		71		1,052
Commercial loans and leases:
Commercial	1,657		355		1,296		3,308		367,505		370,813		—		1,339
Equipment financing	1,199		526		2,098		3,823		530,438		534,261		122		3,251
Condominium association	139		—		—		139		45,469		45,608		—		—
Total commercial loans and leases	2,995		881		3,394		7,270		943,412		950,682		122		4,590
Indirect automobile	4,754		579		19		5,352		370,962		376,314		2		325
Consumer loans:
Residential mortgage	493		—		29		522		442,029		442,551		—		1,393
Home equity	100		21		—		121		155,001		155,122		—		404
Other consumer	13		4		15		32		14,311		14,343		—		15
Total consumer loans	606		25		44		675		611,341		612,016		—		1,812
Total originated loans and leases	$	8,355	$	2,373	$	3,692	$	14,420	$	3,842,387	$	3,856,807	$	195	$	7,779

	At June 30, 2014
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Acquired:
Commercial real estate loans:
Commercial real estate mortgage	$	3,754	$	362	$	2,122	$	6,238	$	309,462	$	315,700	$	1,627	$	1,959
Multi-family mortgage	1,012		—		1,296		2,308		66,991		69,299		1,296		—
Construction	268		—		—		268		11,523		11,791		—		—
Total commercial real estate loans	5,034		362		3,418		8,814		387,976		396,790		2,923		1,959
Commercial loans and leases:
Commercial	383		300		3,315		3,998		104,045		108,043		864		5,044
Equipment financing	—		35		72		107		18,121		18,228		73		—
Total commercial loans and leases	383		335		3,387		4,105		122,166		126,271		937		5,044
Consumer loans:
Residential mortgage	456		53		3,090		3,599		104,664		108,263		2,428		991
Home equity	764		1,049		783		2,596		112,485		115,081		170		1,367
Other consumer	1		10		16		27		674		701		—		21
Total consumer loans	1,221		1,112		3,889		6,222		217,823		224,045		2,598		2,379
Total acquired loans and leases	$	6,638	$	1,809	$	10,694	$	19,141	$	727,965	$	747,106	$	6,458	$	9,382
Total loans and leases	$	14,993	$	4,182	$	14,386	$	33,561	$	4,570,352	$	4,603,913	$	6,653	$	17,161

	At December 31, 2013
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Originated:
Commercial real estate loans:
Commercial real estate mortgage	$	4,896	$	1,393	$	169	$	6,458	$	1,105,292	$	1,111,750	$	—	$	169
Multi-family mortgage	14,400		—		—		14,400		540,155		554,555		—		—
Construction	—		—		—		—		102,927		102,927		—		—
Total commercial real estate loans	19,296		1,393		169		20,858		1,748,374		1,769,232		—		169
Commercial loans and leases:
Commercial	2,288		75		842		3,205		294,479		297,684		—		1,551
Equipment financing	867		1,558		2,031		4,456		480,874		485,330		—		4,086
Condominium association	—		—		—		—		44,794		44,794		—		1
Total commercial loans and leases	3,155		1,633		2,873		7,661		820,147		827,808		—		5,638
Indirect automobile	5,407		857		229		6,493		394,038		400,531		10		259
Consumer loans:
Residential mortgage	201		—		415		616		410,938		411,554		—		1,713
Home equity	218		—		—		218		132,178		132,396		—		462
Other consumer	11		1		4		16		5,516		5,532		—		4
Total consumer loans	430		1		419		850		548,632		549,482		—		2,179
Total originated loans and leases	$	28,288	$	3,884	$	3,690	$	35,862	$	3,511,191	$	3,547,053	$	10	$	8,245

	At December 31, 2013
	Past Due												Loans and Leases Past
	31-60 Days		61-90 Days		Greater  Than 90  Days		Total		Current		Total Loans and Leases		Due Greater Than 90 Days and Accruing		Nonaccrual Loans and Leases
	(In Thousands)
Acquired:
Commercial real estate loans:
Commercial real estate mortgage	$	1,221	$	87	$	4,887	$	6,195	$	344,040	$	350,235	$	3,958	$	929
Multi-family mortgage	327		—		1,052		1,379		71,999		73,378		1,052		—
Construction	—		409		—		409		10,369		10,778		—		—
Total commercial real estate loans	1,548		496		5,939		7,983		426,408		434,391		5,010		929
Commercial loans and leases:
Commercial	2,707		121		1,931		4,759		105,349		110,108		1,235		4,597
Equipment financing	46		41		73		160		27,534		27,694		73		29
Total commercial loans and leases	2,753		162		2,004		4,919		132,883		137,802		1,308		4,626
Consumer loans:
Residential mortgage	271		777		5,329		6,377		110,254		116,631		4,468		1,162
Home equity	1,259		552		895		2,706		122,359		125,065		117		1,525
Other consumer	6		11		4		21		1,502		1,523		—		14
Total consumer loans	1,536		1,340		6,228		9,104		234,115		243,219		4,585		2,701
Total acquired loans and leases	$	5,837	$	1,998	$	14,171	$	22,006	$	793,406	$	815,412	$	10,903	$	8,256
Total loan and leases	$	34,125	$	5,882	$	17,861	$	57,868	$	4,304,597	$	4,362,465	$	10,913	$	16,501

Commercial Real Estate Loans — At June 30, 2014, loans outstanding in the three classes within this segment expressed as a percentage of total loans and leases outstanding were as follows: commercial real estate mortgage loans — 33.6%; multi-family mortgage loans — 13.7%; and construction loans — 3.0%.

Loans in this portfolio that are on nonaccrual status and/or risk-rated “substandard” or worse are evaluated on an individual loan basis for impairment. For non-impaired commercial real estate loans, loss factors are applied to outstanding loans by risk rating for each of the three classes in the portfolio. The factors applied are based primarily on historic loan loss experience and an assessment of internal and external factors and other relevant information.

Commercial Loans and Leases — At June 30, 2014, loans and leases outstanding in the three classes within this segment expressed as a percent of total loans and leases outstanding were as follows: commercial loans and leases — 10.4%; equipment financing loans — 12.0%; and loans to condominium associations — 1.0%.

Loans and leases in this portfolio that are on nonaccrual status and/or risk-rated “substandard” or worse are evaluated on an individual basis for impairment. For non-impaired commercial loans and leases, loss factors are applied to outstanding loans by risk rating for each of the three classes in the portfolio.

Indirect Automobile Loans — At June 30, 2014, indirect automobile loans represented 8.2% of the Company’s total loan and lease portfolio. Determination of the allowance for loan and lease losses for this portfolio is based primarily on payment status and historical loss rates.

Consumer Loans — At June 30, 2014, loans outstanding within the three classes within this segment expressed as a percent of total loans and leases outstanding were as follows: residential mortgage loans — 11.9%; home equity loans — 5.9%; and other consumer loans — 0.3%.

Significant risk characteristics related to the residential mortgage and home equity loan portfolios are the geographic concentration of the properties financed within selected communities in the greater Boston and Providence metropolitan areas and the economic conditions in those areas as previously commented upon in the “Commercial Real Estate Loans” subsection above. The payment status and loan-to-value ratio are the primary credit quality indicators used for residential mortgage loans and home equity loans. Generally, loans are not made when the loan-to-value ratio exceeds 80% unless private mortgage insurance is obtained and/or there is a financially strong guarantor. Consumer loans that become 90 days or more past due, or are placed on nonaccrual regardless of past due status, are reviewed on an individual basis for impairment by assessing the net realizable value of underlying collateral and the economic condition of the borrower.

Impaired Loans and Leases

When the ultimate collectability of the total principal of an impaired loan or lease is in doubt and the loan is on nonaccrual status, all payments are applied to principal, under the cost recovery method. When the ultimate collectability of the total principal of an impaired loan or lease is not in doubt and the loan or lease is on nonaccrual status, contractual interest is credited to interest income when received, under the cash basis method.

The following tables include the recorded investment and unpaid principal balances of impaired loans and leases with the related allowance amount, if applicable, for the originated and acquired loan and lease portfolios at the dates indicated. Also presented are the average recorded investments in the impaired loans and leases and the related amount of interest recognized during the period that the impaired loans were impaired.

	At June 30, 2014						At December 31, 2013
	Recorded Investment (1)		Unpaid Principal Balance		Related Allowance		Recorded Investment (2)		Unpaid Principal Balance		Related Allowance
	(In Thousands)
Originated:
With no related allowance recorded:
Commercial real estate	$	944	$	944	$	—	$	2,009	$	2,009	$	—
Commercial	5,487		5,507		—		4,410		4,399		—
Consumer	78		78		—		989		987		—
Total originated with no related allowance recorded	6,509		6,529		—		7,408		7,395		—
With an allowance recorded:
Commercial real estate	2,808		2,808		47		1,466		1,466		184
Commercial	3,486		3,457		820		2,393		2,383		675
Consumer	3,571		3,561		—		2,448		2,440		323
Total originated with an allowance recorded	9,865		9,826		867		6,307		6,289		1,182
Total originated impaired loans and leases	16,374		16,355		867		13,715		13,684		1,182
Acquired:
With no related allowance recorded:
Commercial real estate	19,870		20,375		—		9,176		10,082		—
Commercial	6,685		6,786		—		6,988		7,248		—
Consumer	4,817		4,817		—		1,033		1,037		—
Total acquired with no related allowance recorded	31,372		31,978		—		17,197		18,367		—
With an allowance recorded:
Commercial real estate	1,521		1,548		50		1,274		1,291		122
Commercial	1,982		2,143		149		1,020		1,067		169
Consumer	707		707		34		—		—		—
Total acquired with an allowance recorded	4,210		4,398		233		2,294		2,358		291
Total acquired impaired loans and leases	35,582		36,376		233		19,491		20,725		291
Total impaired loans and leases	$	51,956	$	52,731	$	1,100	$	33,206	$	34,409	$	1,473

⁽¹⁾Includes originated and acquired nonaccrual loans of $6.1 million and $8.9 million at June 30, 2014, respectively.

⁽²⁾Includes originated and acquired nonaccrual loans of $5.8 million and $5.7 million at December 31, 2013, respectively.

	Three Months Ended
	June 30, 2014				June 30, 2013
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
	(In Thousands)
Originated:
With no related allowance recorded:
Commercial real estate	$	947	$	12	$	1,939	$	30
Commercial	5,711		62		3,139		29
Consumer	128		—		1,323		18
Total originated with no related allowance recorded	6,786		74		6,401		77
With an allowance recorded:
Commercial real estate	3,010		22		1,256		10
Commercial	3,800		24		1,682		6
Consumer	3,582		15		2,681		35
Total originated with an allowance recorded	10,392		61		5,619		51
Total originated impaired loans and leases	17,178		135		12,020		128
Acquired:
With no related allowance recorded:
Commercial real estate	20,402		182		3,217		88
Commercial	6,775		23		1,548		26
Consumer	4,807		5		317		8
Total acquired with no related allowance recorded	31,984		210		5,082		122
With an allowance recorded:
Commercial real estate	1,522		3		3,679		—
Commercial	1,948		14		—		—
Consumer	770		1		—		—
Total acquired with an allowance recorded	4,240		18		3,679		—
Total acquired impaired loans and leases	36,224		228		8,761		122
Total impaired loans and leases	$	53,402	$	363	$	20,781	$	250

	Six Months Ended
	June 30, 2014				June 30, 2013
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
	(In Thousands)
Originated:
With no related allowance recorded:
Commercial real estate	$	2,422	$	48	$	2,695	$	30
Commercial	4,796		70		4,030		60
Consumer	1,980		13		1,328		18
Total originated with no related allowance recorded	9,198		131		8,053		108
With an allowance recorded:
Commercial real estate	1,587		22		1,469		17
Commercial	3,728		48		1,686		7
Consumer	1,940		15		3,475		39
Total originated with an allowance recorded	7,255		85		6,630		63
Total originated impaired loans and leases	16,453		216		14,683		171
Acquired:
With no related allowance recorded:
Commercial real estate	13,990		228		11,291		99
Commercial	7,498		59		4,369		66
Consumer	6,539		10		1,489		8
Total acquired with no related allowance recorded	28,027		297		17,149		173
With an allowance recorded:
Commercial real estate	2,971		40		3,700		—
Commercial	1,247		15		631		—
Consumer	385		1		—		—
Total acquired with an allowance recorded	4,603		56		4,331		—
Total acquired impaired loans and leases	32,630		353		21,480		173
Total impaired loans and leases	$	49,083	$	569	$	36,163	$	344

The following tables present information regarding impaired and non-impaired loans and leases at the dates indicated:

	At June 30, 2014
	Commercial Real Estate			Commercial		Indirect Automobile		Consumer		Unallocated		Total
	(In Thousands)
Allowance for Loan and Lease Losses:
Originated:
Individually evaluated for impairment	$	47		$	820	$	—	$	—	$	—	$	867
Collectively evaluated for impairment	26,152			14,564		3,686		2,768		2,402		49,572
Total originated loans and leases	26,199			15,384		3,686		2,768		2,402		50,439
Acquired:
Individually evaluated for impairment	—			59		—		34		—		93
Collectively evaluated for impairment	(53		)	217		—		2		—		166
Acquired with deteriorated credit quality	569			206		—		213		—		988
Total acquired loans and leases	516			482		—		249		—		1,247
Total allowance for loan and lease losses	$	26,715		$	15,866	$	3,686	$	3,017	$	2,402	$	51,686
Loans and Leases:
Originated:
Individually evaluated for impairment	$	3,753		$	8,974	$	—	$	3,648	$	—	$	16,375
Collectively evaluated for impairment	1,914,042			941,708		376,314		608,368		—		3,840,432
Total originated loans and leases	1,917,795			950,682		376,314		612,016		—		3,856,807
Acquired:
Individually evaluated for impairment	1,355			4,707		—		2,327		—		8,389
Collectively evaluated for impairment	127,603			90,418		—		147,840		—		365,861
Acquired with deteriorated credit quality	267,832			31,146		—		73,878		—		372,856
Total acquired loans and leases	396,790			126,271		—		224,045		—		747,106
Total loans and leases	$	2,314,585		$	1,076,953	$	376,314	$	836,061	$	—	$	4,603,913

	At December 31, 2013
	Commercial Real Estate			Commercial		Indirect Automobile		Consumer		Unallocated		Total
	(In Thousands)
Allowance for Loan and Lease Losses:
Originated:
Individually evaluated for impairment	$	184		$	675	$	—	$	323	$	—	$	1,182
Collectively evaluated for impairment	22,336			14,056		3,924		2,414		2,932		45,662
Total originated loans and leases	22,520			14,731		3,924		2,737		2,932		46,844
Acquired:
Individually evaluated for impairment	—			3		—		—		—		3
Collectively evaluated for impairment	(54		)	234		—		204		—		384
Acquired with deteriorated credit quality	556			252		—		434		—		1,242
Total acquired loans and leases	502			489		—		638		—		1,629
Total allowance for loan and lease losses	$	23,022		$	15,220	$	3,924	$	3,375	$	2,932	$	48,473
Loans and Leases:
Originated:
Individually evaluated for impairment	$	3,643		$	6,634	$	—	$	3,438	$	—	$	13,715
Collectively evaluated for impairment	1,765,589			821,174		400,531		546,044		—		3,533,338
Total originated loans and leases	1,769,232			827,808		400,531		549,482		—		3,547,053
Acquired:
Individually evaluated for impairment	2,625			4,878		—		872		—		8,375
Collectively evaluated for impairment	145,057			93,565		—		162,595		—		401,217
Acquired with deteriorated credit quality	286,709			39,359		—		79,752		—		405,820
Total acquired loans and leases	434,391			137,802		—		243,219		—		815,412
Total loans and leases	$	2,203,623		$	965,610	$	400,531	$	792,701	$	—	$	4,362,465

Troubled Debt Restructured Loans and Leases

The recorded investment in troubled debt restructurings and the associated specific allowances for loan and lease losses, in the originated and acquired loan and lease portfolios, are as follows for the periods indicated.

	At and for the Three Months Ended June 30, 2014
	Recorded Investment					Specific				Defaulted
	Number of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial	2	$	390	$	365	$	17	$	17	$	—	—	—
Equipment financing	1	289		289		—		—		—		1	259
Residential mortgage	1	291		291		—		—		—		—	—
Total Originated	4	970		945		17		17		—		1	259
Acquired:
Commercial	2	253		261		9		261		—		—	—
Total Acquired	2	253		261		9		261		—		—	—
Total	6	$	1,223	$	1,206	$	26	$	278	$	—	1	$	259

	At and for the Three Months Ended June 30, 2013
	Recorded Investment					Specific				Defaulted
	Number  of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial	—	$	—	$	—	$	—	$	—	$	—	2	$	1,714
Equipment financing	2	488		498		12		372		—		1	303
Residential mortgage	—	—		—		—		—		—		1	373
Total Originated	2	488		498		12		372		—		4	2,390
Acquired:
Commercial	1	424		421		—		421		—		—	—
Total Acquired	1	424		421		—		421		—		—	—
Total	3	$	912	$	919	$	12	$	793	$	—	4	$	2,390

	At and for the Six Months Ended June 30, 2014
	Recorded Investment					Specific				Defaulted
	Number of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial real estate mortgage	1	$	953	$	944	$	—	$	—	$	—	—	$	—
Commercial	2	390		365		17		17		—		—	—
Equipment financing	2	673		671		—		—		—		3	349
Residential mortgage	2	789		786		—		495		—		—	—
Total Originated	7	2,805		2,766		17		512		—		3	349
Acquired:
Commercial	2	253		261		9		261		—		—	—
Total Acquired	2	253		261		9		261		—		—	—
Total	9	$	3,058	$	3,027	$	26	$	773	$	—	3	$	349

	At and for the Six Months Ended June 30, 2013
	Recorded Investment					Specific				Defaulted
	Number of Loans/ Leases	At Modification		At End of Period		Allowance for Loan and Lease Losses		Nonaccrual Loans and Leases		Additional Commitment		Number of Loans/ Leases	Recorded Investment
	(Dollars in Thousands)
Originated:
Commercial real estate mortgage	1	$	1,039	$	—	$	—	$	—	$	—	—	$	—
Equipment financing	8	1,125		1,129		42		372		—		—	—
Residential mortgage	1	415		372		—		—		—		—	—
Total Originated	10	2,579		1,501		42		372		—		—	—
Acquired:
Commercial	1	424		421		—		421		—		—	—
Total Acquired	1	424		421		—		421		—		—	—
Total	11	$	3,003	$	1,922	$	42	$	793	$	—	—	$	—

The following table sets forth the Company’s balances of troubled debt restructurings that were modified at the dates indicated, by type of modification.

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In Thousands)
Loans with one modification:
Extended maturity	$	609	$	—	$	609	$	—
Adjusted principal	—		—		—		372
Adjusted interest rate	—		793		878		793
Interest only	17		—		17		—
Combination maturity, principal, interest rate	—		126		—		757
Total loans with one modification	$	626	$	919	$	1,504	$	1,922
Loans with more than one modification:
Extended maturity	$	289	$	—	$	1,233	$	—
Interest only	291		—		291		—
Total loans with more than one modification	$	580	$	—	$	1,524	$	—

The financial impact of the modification of performing and nonperforming loans and leases for the three months ended June 30, 2014 and 2013 was $0.1 million and $0.3 million, respectively. The financial impact of the modification of performing or nonperforming loans and leases for the six months ended June 30, 2014 and 2013 was also $0.1 million and $0.3 million, respectively.

As of June 30, 2014 and 2013, there were no commitments to lend funds to debtors owing receivables whose terms had been modified in troubled debt restructurings.

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Premises and Equipment (Notes)

6 Months Ended

Jun. 30, 2014

Property, Plant and Equipment [Abstract]

Premises and Equipment

Premises and Equipment

In January 2014, the Company completed a transaction to sell a facility located in Brookline, MA, for $2.2 million. The carrying value of the property, including land, building, and furniture, fixtures, and equipment, was $0.4 million. After costs to sell of $0.2 million, the Company recorded a gain on sale in the amount of $1.6 million during the six months endedJune 30, 2014, which is included in gain on sale/disposals of premises and equipment, net in the Company’s unaudited consolidated statements of income.

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Comprehensive Income/(Loss)

6 Months Ended

Jun. 30, 2014

Equity [Abstract]

Comprehensive Income/(Loss)

Comprehensive Income/(Loss)

Comprehensive income (loss) represents the sum of net income (loss) and other comprehensive income (loss). For the three months and six months endedJune 30, 2014 and June 30, 2013, the Company’s other comprehensive income (loss) include the following two components: (i) unrealized holding gains (losses) on investment securities available-for-sale; and (ii) adjustment of accumulated obligation for postretirement benefits.

Changes in accumulated other comprehensive (loss) income by component, net of tax, were as follows for the periods indicated:

	Three Months Ended June 30, 2014
	Investment Securities Available-for-Sale			Postretirement Benefits		Accumulated Other Comprehensive Income
	(In Thousands)
Balance at March 31, 2014	$	(6,301	)	$	365	$	(5,936	)
Other comprehensive income	2,727			—		2,727
Balance at June 30, 2014	$	(3,574	)	$	365	$	(3,209	)

	Three Months Ended June 30, 2013
	Investment Securities  Available-for-Sale			Postretirement Benefits		Accumulated Other Comprehensive Income
	(In Thousands)
Balance at March 31, 2013	$	2,108		$	125	$	2,233
Other comprehensive (loss) income	(6,680		)	6		(6,674		)
Balance at June 30, 2013	$	(4,572	)	$	131	$	(4,441	)

	Six Months Ended June 30, 2014
	Investment Securities Available-for-Sale			Postretirement Benefits			Accumulated Other Comprehensive Income
	(In Thousands)
Balance at December 31, 2013	$	(8,332	)	$	417		$	(7,915	)
Other comprehensive income (loss)	4,758			(52		)	4,706
Balance at June 30, 2014	$	(3,574	)	$	365		$	(3,209	)

	Six Months Ended June 30, 2013
	Investment Securities Available-for-Sale			Postretirement Benefits		Accumulated Other Comprehensive Income
	(In Thousands)
Balance at December 31, 2012	$	3,358		$	125	$	3,483
Other comprehensive (loss) income	(7,930		)	6		(7,924		)
Balance at June 30, 2013	$	(4,572	)	$	131	$	(4,441	)

The following is a summary of the amounts reclassified from accumulated other comprehensive income (loss) for the three months or six months endedJune 30, 2014.

	Three Months Ended			Six Months Ended			Income Statement Line Affected by Reclassification
	June 30, 2014			June 30, 2014
	(In Thousands)
Other comprehensive income (loss) component
Unrealized gains (losses) on investment securities available-for-sale	$	(13	)	$	(13	)	Loss on sales of securities, net
	5			5			Provision for income taxes
Total reclassifications for the period	$	(8	)	$	(8	)	Net income

The Company did not reclassify any amounts out of accumulated other comprehensive income (loss) for the three months or six months endedJune 30, 2013.

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Investment Securities (Details 2) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Less than 12 months
Estimated Fair Value	$ 57,301	$ 350,313
Unrealized Losses	913	13,668
12 months or Longer
Estimated Fair Value	287,162	32,950
Unrealized Losses	8,296	2,473
Total
Estimated Fair Value	344,463	383,263
Unrealized Losses	9,209	16,141
Debt securities
Less than 12 months
Estimated Fair Value	56,790	349,812
Unrealized Losses	912	13,658
12 months or Longer
Estimated Fair Value	287,162	32,950
Unrealized Losses	8,296	2,473
Total
Estimated Fair Value	343,952	382,762
Unrealized Losses	9,208	16,131
GSE
Less than 12 months
Estimated Fair Value	1,963
Unrealized Losses	11
12 months or Longer
Estimated Fair Value	0
Unrealized Losses	0
Total
Estimated Fair Value	1,963
Unrealized Losses	11
GSE CMOs
Less than 12 months
Estimated Fair Value	38,406	221,317
Unrealized Losses	839	9,861
12 months or Longer
Estimated Fair Value	196,095	16,257
Unrealized Losses	6,623	912
Total
Estimated Fair Value	234,501	237,574
Unrealized Losses	7,462	10,773
GSE MBS
Less than 12 months
Estimated Fair Value	12,323	121,836
Unrealized Losses	51	3,746
12 months or Longer
Estimated Fair Value	89,592	13,516
Unrealized Losses	1,509	1,183
Total
Estimated Fair Value	101,915	135,352
Unrealized Losses	1,560	4,929
Private-label CMOs
Less than 12 months
Estimated Fair Value		639
Unrealized Losses		18
12 months or Longer
Estimated Fair Value		0
Unrealized Losses		0
Total
Estimated Fair Value		639
Unrealized Losses		18
SBA commercial loan asset-backed securities
Less than 12 months
Estimated Fair Value	31	32
Unrealized Losses	0	0
12 months or Longer
Estimated Fair Value	176	192
Unrealized Losses	1	2
Total
Estimated Fair Value	207	224
Unrealized Losses	1	2
Auction-rate municipal obligations
Less than 12 months
Estimated Fair Value		0
Unrealized Losses		0
12 months or Longer
Estimated Fair Value		1,775
Unrealized Losses		125
Total
Estimated Fair Value		1,775
Unrealized Losses		125
Corporate debt obligations
Less than 12 months
Estimated Fair Value	4,067	5,988
Unrealized Losses	11	33
12 months or Longer
Estimated Fair Value	0	0
Unrealized Losses	0	0
Total
Estimated Fair Value	4,067	5,988
Unrealized Losses	11	33
Trust preferred securities and pools
Less than 12 months
Estimated Fair Value	0	0
Unrealized Losses	0	0
12 months or Longer
Estimated Fair Value	1,299	1,210
Unrealized Losses	163	251
Total
Estimated Fair Value	1,299	1,210
Unrealized Losses	163	251
Marketable equity securities
Less than 12 months
Estimated Fair Value	511	501
Unrealized Losses	1	10
12 months or Longer
Estimated Fair Value	0	0
Unrealized Losses	0	0
Total
Estimated Fair Value	511	501
Unrealized Losses	$ 1	$ 10

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Goodwill and Other Intangible Assets (Details 2) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014
Scheduled amortization expense attributable to other acquisition-related intangible assets
Remainder of 2014	$ 1,436
2015	2,868
2016	2,457
2017	1,858
2018	1,836
Thereafter	3,655
Total	$ 14,110

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Off-Balance-Sheet Financial Instruments

The Company is party to off-balance-sheet financial instruments in the normal course of business to meet the financing needs of its customers and to reduce its own exposure to fluctuations in interest rates. These financial instruments include loan commitments, standby and commercial letters of credit, and interest-rate swaps. According to GAAP, these financial instruments are not recorded in the financial statements until they are funded or related fees are incurred or received.

The contract amounts reflect the extent of the involvement the Company has in particular classes of these instruments. Such commitments involve, to varying degrees, elements of credit risk and interest-rate risk in excess of the amount recognized in the consolidated balance sheet. The Company’s exposure to credit loss in the event of non-performance by the counterparty is represented by the contractual amount of the instruments. The Company uses the same policies in making commitments and conditional obligations as it does for on-balance-sheet instruments.

Financial instruments with off-balance-sheet risk at the dates indicated follow:

	At June 30, 2014		At December 31, 2013
	(In Thousands)
Financial instruments whose contract amounts represent credit risk:
Commitments to originate loans and leases:
Commercial real estate	$	67,378	$	48,973
Commercial	146,347		143,252
Residential mortgage	10,524		8,027
Unadvanced portion of loans and leases	549,473		586,279
Unused lines of credit:
Home equity	212,857		205,665
Other consumer	6,386		6,503
Other commercial	1,138		1,035
Unused letters of credit:
Financial standby letters of credit	18,322		20,410
Performance standby letters of credit	3,189		2,989
Commercial and similar letters of credit	2,302		440
Back-to-back interest-rate swaps	28,017		22,418

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require the payment of a fee by the customer. Since some of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if any, is based on management’s credit evaluation of the borrower.

Standby and commercial letters of credit are conditional commitments issued by the Company to guarantee performance of a customer to a third party. These standby and commercial letters of credit are primarily issued to support the financing needs of the Company’s commercial customers. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loans to customers.

The liability for unfunded credit commitments, which is included in other liabilities, was $1.2 million at June 30, 2014 and $1.0 million at December 31, 2013.

From time to time the Company enters into back-to-back interest rate swaps with commercial customers and third-party financial institutions. These swaps allow the Company to offer long-term fixed-rate commercial loans while mitigating the interest-rate risk of holding those loans. In a back-to-back interest rate swap transaction, the Company lends to a commercial customer on a floating-rate basis and then enters into an interest rate swap with that customer. Concurrently, the Company enters into offsetting swaps with a third-party financial institution, effectively minimizing its net interest-rate risk exposure resulting from such transactions.

The fair value of interest rate swap assets and liabilities is $0.9 million and $0.9 million, respectively, at June 30, 2014. The fair value of interest rate swap assets and liabilities is $0.8 million and $0.9 million, respectively, at December 31, 2013.

Lease Commitments

The Company leases certain office space under various noncancellable operating leases. A summary of future minimum rental payments under such leases at the dates indicated follows:

	Minimum Rental Payments
	(In Thousands)
Remainder of 2014	2,695
Year ending:
2015	5,477
2016	5,333
2017	4,804
2018	4,229
Thereafter	15,582
Total	$	38,120

The leases contain escalator clauses for real estate taxes and other expenditures. Total rental expense was $3.6 million during the six months ended June 30, 2014, which included $0.8 million in lease acceleration related to a relocation of an operations center and a closure of a branch property. This compared to $2.5 million during the six months ended June 30, 2013.

Legal Proceedings

In the normal course of business, there are various outstanding legal proceedings. In the opinion of management, after consulting with legal counsel, the consolidated financial position and results of operations of the Company are not expected to be affected by the outcome of such proceedings.

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Goodwill and Other Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of composition of goodwill and other intangible assets

The following table sets forth the composition of goodwill and other intangible assets at the dates indicated:

	At June 30, 2014		At December 31, 2013
	(In Thousands)
Goodwill	$	137,890	$	137,890
Other intangible assets:
Core deposits	14,110		15,777
Trade name	1,089		1,089
Trust relationship	—		21
Total other intangible assets	15,199		16,887
Total goodwill and other intangible assets	$	153,089	$	154,777

Schedule of estimated aggregate future amortization expense for intangible assets

The estimated aggregate future amortization expense (in thousands) for intangible assets with a finite life remaining at June 30, 2014 is as follows:

Remainder of 2014	$	1,436
Year ending:
2015	2,868
2016	2,457
2017	1,858
2018	1,836
Thereafter	3,655
Total	$	14,110

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Premises and Equipment (Details) (USD $)	3 Months Ended		6 Months Ended			1 Months Ended	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013	Jan. 31, 2014 Facility [Member]	Jun. 30, 2014 Facility [Member]
Property, Plant and Equipment [Line Items]
Proceeds from sales or premises and equipment			$ 1,972,000	$ 81,000		$ 2,200,000
Carrying value of premises and equipment	82,166,000		82,166,000		80,505,000	400,000
Cost of sale							200,000
Gain on sale/disposals of premises and equipment, net	$ (6,000)	$ (21,000)	$ 1,504,000	$ (21,000)			$ 1,600,000

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Loans and Leases (Details 3) (Directors, executive officers and their affiliates, USD $)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Directors, executive officers and their affiliates
Loans and Leases Receivable, Related Parties [Roll Forward]
Balance at the beginning of the year	$ 16,110,000	$ 4,083,000
New loans granted during the year	1,740,000	100,000
Advances on lines of credit	1,451,000	91,000
Repayments	(522,000)	(349,000)
Loans no longer classified as related party loans	(978,000)	545,000
Balance at the end of the year	17,801,000	4,470,000
Unfunded commitments on extensions of credit to insiders	$ 10,400,000		$ 11,700,000

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Unaudited Consolidated Statements of Comprehensive Income (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Statement of Comprehensive Income [Abstract]
Net income before noncontrolling interest in subsidiary	$ 10,452	$ 9,865	$ 21,296	$ 19,106
Investment securities available-for-sale:
Unrealized securities holding gains (losses)	4,350	(10,773)	7,643	(12,791)
Income tax (expense) benefit	(1,631)	4,093	(2,893)	4,861
Net unrealized securities holding gains (losses) before reclassification adjustments	2,719	(6,680)	4,750	(7,930)
Less reclassification adjustments for securities losses included in net income:
Loss on sales of securities, net	(13)	0	(13)	0
Income tax benefit	5	0	5	0
Net reclassification adjustments for securities losses included in net income	(8)	0	(8)	0
Net securities holding gains (losses)	2,727	(6,680)	4,758	(7,930)
Postretirement benefits:
Adjustment of accumulated obligation for postretirement benefits	0	8	(85)	8
Income tax (expense) benefit	0	(2)	33	(2)
Net adjustment of accumulated obligation for postretirement benefits	0	6	(52)	6
Other comprehensive income (loss), net of taxes	2,727	(6,674)	4,706	(7,924)
Comprehensive income	13,179	3,191	26,002	11,182
Net income attributable to noncontrolling interest in subsidiary	476	375	898	802
Comprehensive income attributable to Brookline Bancorp, Inc.	$ 12,703	$ 2,816	$ 25,104	$ 10,380

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Recent Accounting Pronouncements

6 Months Ended

Jun. 30, 2014

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In June 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2014-11, Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures. This ASU eliminates sale accounting for repurchase-to-maturity transactions and supersedes the guidance under which a transfer of a financial asset and a contemporaneous repurchase financing could be accounted for on a combined basis as a forward agreement. In addition, the ASU requires a new disclosure for transactions economically similar to repurchase agreements in which the transferor retains substantially all of the exposure to the economic return on the transferred financial assets throughout the term of the transaction. The ASU is effective for annual periods beginning after December 15, 2014 and interim periods beginning after December 15, 2015; early application is not permitted. The Company is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2014.

In May 2014, the FASB issued ASU 2014-09, Revenue From Contracts with Customers. This ASU provides a single principles-based, five-step model to be applied to all contracts with customers. The ASU applies to all contracts with customers except those that are within the scope of other topics in the FASB Accounting Standards Codification. The ASU is effective for annual periods (including interim reporting periods within those periods) beginning after December 15, 2016; early application is not permitted. The Company is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2014.

In January 2014, the FASB issued ASU 2014-04, Receivables-Troubled Debt Restructurings by Creditors. This ASU provides clarification on when an in substance repossession or foreclosure occurs resulting in the creditor derecognizing the loan and recognizing the collateral. Currently, there is no definition of in substance repossession or foreclosure and physical possession in the accounting literature. This ASU is applied retrospectively or effective prospectively for all annual periods presented beginning after December 15, 2014; early adoption is permitted. The Company has not chosen to early adopt ASU 2014-04 and is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2014.

In January 2014, the FASB issued ASU 2014-01, Accounting for Investments in Qualified Affordable Housing Projects. This ASU provides guidance on accounting for investments by a reporting entity in flow-through limited liability entities. Currently, investments in qualified affordable housing projects are accounted for either by the effective yield, equity or cost method. This ASU allows for reporting entities to make a policy election on how to account for their investments. This ASU is applied retrospectively or effective prospectively for all annual periods presented beginning after December 15, 2014; early adoption is permitted. The Company has not chosen to early adopt ASU 2014-01 and is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2014.

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Fair Value of Financial Instruments (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Dec. 31, 2013
Fair value of assets and liabilities
Total securities available-for-sale	$ 528,586	$ 492,428
Interest-rate swaps	887	825
Interest-rate swaps	912	856
Changes in generic pricing of securities period one, considered for analyzing changes in prices obtained from pricing service	15 years
Changes in generic pricing of securities period two, considered for analyzing changes in prices obtained from pricing service	30 years
Recurring basis | Level 1
Fair value of assets and liabilities
Interest-rate swaps	0	0
Interest-rate swaps	0	0
Recurring basis | Level 1 | Securities available for sale
Fair value of assets and liabilities
Total securities available-for-sale	1,359	1,310
Recurring basis | Level 1 | GSEs
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 1 | GSE CMOs
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 1 | GSE MBSs
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 1 | Private-label CMO
Fair value of assets and liabilities
Total securities available-for-sale		0
Recurring basis | Level 1 | SBA commercial loan asset-backed securities
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 1 | Auction-rate municipal obligations
Fair value of assets and liabilities
Total securities available-for-sale		0
Recurring basis | Level 1 | Municipal obligations
Fair value of assets and liabilities
Total securities available-for-sale		0
Recurring basis | Level 1 | Corporate debt obligations
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 1 | Trust preferred securities and pools
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 1 | Marketable equity securities
Fair value of assets and liabilities
Total securities available-for-sale	1,359	1,310
Recurring basis | Level 2
Fair value of assets and liabilities
Interest-rate swaps	887	825
Interest-rate swaps	912	856
Recurring basis | Level 2 | Securities available for sale
Fair value of assets and liabilities
Total securities available-for-sale	527,227	489,343
Recurring basis | Level 2 | GSEs
Fair value of assets and liabilities
Total securities available-for-sale	15,978	12,180
Recurring basis | Level 2 | GSE CMOs
Fair value of assets and liabilities
Total securities available-for-sale	247,547	243,644
Recurring basis | Level 2 | GSE MBSs
Fair value of assets and liabilities
Total securities available-for-sale	221,847	199,401
Recurring basis | Level 2 | Private-label CMO
Fair value of assets and liabilities
Total securities available-for-sale		3,355
Recurring basis | Level 2 | SBA commercial loan asset-backed securities
Fair value of assets and liabilities
Total securities available-for-sale	226	243
Recurring basis | Level 2 | Auction-rate municipal obligations
Fair value of assets and liabilities
Total securities available-for-sale		0
Recurring basis | Level 2 | Municipal obligations
Fair value of assets and liabilities
Total securities available-for-sale		1,086
Recurring basis | Level 2 | Corporate debt obligations
Fair value of assets and liabilities
Total securities available-for-sale	40,330	28,224
Recurring basis | Level 2 | Trust preferred securities and pools
Fair value of assets and liabilities
Total securities available-for-sale	1,299	1,210
Recurring basis | Level 2 | Marketable equity securities
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 3
Fair value of assets and liabilities
Interest-rate swaps	0	0
Interest-rate swaps	0	0
Recurring basis | Level 3 | Securities available for sale
Fair value of assets and liabilities
Total securities available-for-sale	0	1,775
Recurring basis | Level 3 | GSEs
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 3 | GSE CMOs
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 3 | GSE MBSs
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 3 | Private-label CMO
Fair value of assets and liabilities
Total securities available-for-sale		0
Recurring basis | Level 3 | SBA commercial loan asset-backed securities
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 3 | Auction-rate municipal obligations
Fair value of assets and liabilities
Total securities available-for-sale		1,775
Recurring basis | Level 3 | Municipal obligations
Fair value of assets and liabilities
Total securities available-for-sale		0
Recurring basis | Level 3 | Corporate debt obligations
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 3 | Trust preferred securities and pools
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Level 3 | Marketable equity securities
Fair value of assets and liabilities
Total securities available-for-sale	0	0
Recurring basis | Estimated Fair Value
Fair value of assets and liabilities
Interest-rate swaps	887	825
Interest-rate swaps	912	856
Recurring basis | Estimated Fair Value | Securities available for sale
Fair value of assets and liabilities
Total securities available-for-sale	528,586	492,428
Recurring basis | Estimated Fair Value | GSEs
Fair value of assets and liabilities
Total securities available-for-sale	15,978	12,180
Recurring basis | Estimated Fair Value | GSE CMOs
Fair value of assets and liabilities
Total securities available-for-sale	247,547	243,644
Recurring basis | Estimated Fair Value | GSE MBSs
Fair value of assets and liabilities
Total securities available-for-sale	221,847	199,401
Recurring basis | Estimated Fair Value | Private-label CMO
Fair value of assets and liabilities
Total securities available-for-sale		3,355
Recurring basis | Estimated Fair Value | SBA commercial loan asset-backed securities
Fair value of assets and liabilities
Total securities available-for-sale	226	243
Recurring basis | Estimated Fair Value | Auction-rate municipal obligations
Fair value of assets and liabilities
Total securities available-for-sale		1,775
Recurring basis | Estimated Fair Value | Municipal obligations
Fair value of assets and liabilities
Total securities available-for-sale		1,086
Recurring basis | Estimated Fair Value | Corporate debt obligations
Fair value of assets and liabilities
Total securities available-for-sale	40,330	28,224
Recurring basis | Estimated Fair Value | Trust preferred securities and pools
Fair value of assets and liabilities
Total securities available-for-sale	1,299	1,210
Recurring basis | Estimated Fair Value | Marketable equity securities
Fair value of assets and liabilities
Total securities available-for-sale	$ 1,359	$ 1,310

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Comprehensive Income/(Loss) (Tables)

6 Months Ended

Jun. 30, 2014

Equity [Abstract]

Schedule of changes in accumulated other comprehensive (loss) income by component, net of tax

Changes in accumulated other comprehensive (loss) income by component, net of tax, were as follows for the periods indicated:

	Three Months Ended June 30, 2014
	Investment Securities Available-for-Sale			Postretirement Benefits		Accumulated Other Comprehensive Income
	(In Thousands)
Balance at March 31, 2014	$	(6,301	)	$	365	$	(5,936	)
Other comprehensive income	2,727			—		2,727
Balance at June 30, 2014	$	(3,574	)	$	365	$	(3,209	)

	Three Months Ended June 30, 2013
	Investment Securities  Available-for-Sale			Postretirement Benefits		Accumulated Other Comprehensive Income
	(In Thousands)
Balance at March 31, 2013	$	2,108		$	125	$	2,233
Other comprehensive (loss) income	(6,680		)	6		(6,674		)
Balance at June 30, 2013	$	(4,572	)	$	131	$	(4,441	)

	Six Months Ended June 30, 2014
	Investment Securities Available-for-Sale			Postretirement Benefits			Accumulated Other Comprehensive Income
	(In Thousands)
Balance at December 31, 2013	$	(8,332	)	$	417		$	(7,915	)
Other comprehensive income (loss)	4,758			(52		)	4,706
Balance at June 30, 2014	$	(3,574	)	$	365		$	(3,209	)

	Six Months Ended June 30, 2013
	Investment Securities Available-for-Sale			Postretirement Benefits		Accumulated Other Comprehensive Income
	(In Thousands)
Balance at December 31, 2012	$	3,358		$	125	$	3,483
Other comprehensive (loss) income	(7,930		)	6		(7,924		)
Balance at June 30, 2013	$	(4,572	)	$	131	$	(4,441	)

Schedule of amounts reclassified from accumulated other comprehensive income (loss)

The following is a summary of the amounts reclassified from accumulated other comprehensive income (loss) for the three months or six months endedJune 30, 2014.

	Three Months Ended			Six Months Ended			Income Statement Line Affected by Reclassification
	June 30, 2014			June 30, 2014
	(In Thousands)
Other comprehensive income (loss) component
Unrealized gains (losses) on investment securities available-for-sale	$	(13	)	$	(13	)	Loss on sales of securities, net
	5			5			Provision for income taxes
Total reclassifications for the period	$	(8	)	$	(8	)	Net income

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Investment Securities (Details 6) (USD $) In Thousands, unless otherwise specified	6 Months Ended		3 Months Ended	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014 Debt securities	Jun. 30, 2014 Debt securities
Schedule of Available-for-sale Securities [Line Items]
Sales of debt securities	$ 5,083	$ 0	$ 5,083	$ 5,083
Gross gains from sales			302	302
Gross losses from sales			315	315
Loss on sales of securities, net			$ (13)	$ (13)

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Fair Value of Financial Instruments

6 Months Ended

Jun. 30, 2014

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value of Financial Instruments

A description of the valuation methodologies used for assets and liabilities measured at fair value on a recurring and non-recurring basis, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. There were no changes in the valuation techniques used during the three months and six months endedJune 30, 2014 and June 30, 2013.

Assets and Liabilities Recorded at Fair Value on a Recurring Basis

The following tables set forth the carrying value of assets and liabilities measured at fair value on a recurring basis at the dates indicated:

	Carrying Value at June 30, 2014
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets:
Investment securities available-for-sale:
GSEs	$	—	$	15,978	$	—	$	15,978
GSE CMOs	—		247,547		—		247,547
GSE MBSs	—		221,847		—		221,847
SBA commercial loan asset-backed securities	—		226		—		226
Corporate debt obligations	—		40,330		—		40,330
Trust preferred securities	—		1,299		—		1,299
Marketable equity securities	1,359		—		—		1,359
Total investment securities available-for-sale	$	1,359	$	527,227	$	—	$	528,586
Interest-rate swaps	$	—	$	887	$	—	$	887
Liabilities:
Interest-rate swaps	$	—	$	912	$	—	$	912

	Carrying Value at December 31, 2013
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets:
Investment securities available-for-sale:
GSEs	$	—	$	12,180	$	—	$	12,180
GSE CMOs	—		243,644		—		243,644
GSE MBSs	—		199,401		—		199,401
Private-label CMOs	—		3,355		—		3,355
SBA commercial loan asset-backed securities	—		243		—		243
Auction-rate municipal obligations	—		—		1,775		1,775
Municipal obligations	—		1,086		—		1,086
Corporate debt obligations	—		28,224		—		28,224
Trust preferred securities	—		1,210		—		1,210
Marketable equity securities	1,310		—		—		1,310
Total investment securities available-for-sale	$	1,310	$	489,343	$	1,775	$	492,428
Interest-rate swaps	$	—	$	825	$	—	$	825
Liabilities:
Interest-rate swaps	$	—	$	856	$	—	$	856

Investment Securities Available-for-Sale

The fair value of investment securities is based principally on market prices and dealer quotes received from third-party and nationally-recognized pricing services for identical investment securities such as U.S. Treasury and agency securities. The Company's marketable equity securities are priced this way and are included in Level 1. These prices are validated by comparing the primary pricing source with an alternative pricing source when available. When quoted market prices for identical securities are unavailable, the Company uses market prices provided by independent pricing services based on recent trading activity and other observable information, including but not limited to market interest-rate curves, referenced credit spreads and estimated prepayment speeds where applicable. These investments include certain U.S. and government agency debt securities, GSE residential MBSs and CMOs, private-label CMOs, municipal and corporate debt securities, and trust preferred securities, all of which are included in Level 2. Certain fair values estimated using pricing models (such as auction-rate municipal securities) are included in Level 3.

Additionally, management reviews changes in fair value from period to period and performs testing to ensure that prices received from the third parties are consistent with management's expectation of the market. Changes in the prices obtained from the pricing service are analyzed from month to month, taking into consideration changes in market conditions including changes in mortgage spreads, changes in U.S. Treasury security yields and changes in generic pricing of 15-year and 30-year securities. Additional analysis may include a review of prices provided by other independent parties, a yield analysis, a review of average life changes using Bloomberg analytics and a review of historical pricing for a particular security.

Interest-Rate Swaps

The fair values for the interest-rate swap assets and liabilities represent a Level 2 valuation and are based on settlement values adjusted for credit risks associated with the counterparties and the Company and observable market interest rate curves. Credit risk adjustments consider factors such as the likelihood of default by the Company and its counterparties, its net exposures and remaining contractual life. To date, the Company has not realized any losses due to a counterparty’s inability to pay any net uncollateralized position. The change in value of interest-rate swap assets and liabilities attributable to credit risk was not significant during the reported periods. See also Note 9, “Derivatives and Hedging Activities.”

The reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In Thousands)
Investment securities available-for-sale, beginning of period	$	1,690		$	2,852		$	1,775		$	2,917
Investment security sales	(1,658		)	—			(1,658		)	—
Principal paydowns and other	—			(207		)	—			(330		)
Total realized losses included in other income	(242		)	—			(242		)	—
Total unrealized losses included in other comprehensive income	210			190			125			248
Investment securities available-for-sale, end of period	$	—		$	2,835		$	—		$	2,835

There were no transfers between levels for assets and liabilities recorded at fair value on a recurring basis during the three months and six months endedJune 30, 2014 and 2013.

Assets and Liabilities Recorded at Fair Value on a Non-Recurring Basis

The table below summarizes assets and liabilities measured at fair value on a non-recurring basis at the dates indicated:

	Carrying Value at June 30, 2014
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets measured at fair value on a non-recurring basis:
Collateral-dependent impaired loans and leases	$	—	$	—	$	4,927	$	4,927
Other real estate owned	—		—		675		675
Repossessed vehicles and equipment	—		571		—		571
Total assets measured at fair value on a non-recurring basis	$	—	$	571	$	5,602	$	6,173

	Carrying Value at December 31, 2013
	Level 1		Level 2		Level 3		Total
	(In Thousands)
Assets measured at fair value on a non-recurring basis:
Collateral-dependent impaired loans and leases	$	—	$	—	$	12,099	$	12,099
Other real estate owned	—		—		577		577
Repossessed vehicles and equipment	—		1,001		—		1,001
Total assets measured at fair value on a non-recurring basis	$	—	$	1,001	$	12,676	$	13,677

Collateral-Dependent Impaired Loans and Leases

For nonperforming loans and leases where the credit quality of the borrower has deteriorated significantly, fair values of the underlying collateral were estimated using purchase and sales agreements (Level 2), or comparable sales or recent appraisals (Level 3), adjusted for selling costs and other expenses.

Other Real Estate Owned

The Company records other real estate owned at the lower of cost or fair value. In estimating fair value, the Company utilizes purchase and sales agreements (Level 2), or comparable sales, recent appraisals or cash flows discounted at an interest rate commensurate with the risk associated with these cash flows (Level 3), adjusted for selling costs and other expenses.

Repossessed Vehicles and Equipment

Repossessed vehicles and equipment are carried at estimated fair value less costs to sell based on auction pricing (Level 2).

The table below presents quantitative information about significant unobservable inputs (Level 3) for assets measured at fair value on a recurring and non-recurring basis at June 30, 2014.

	Fair Value		Valuation Technique
	(Dollars in Thousands)
Collateral-dependent impaired loans and leases	$	4,927	Appraisal of collateral (1)
Other real estate owned	$	675	Appraisal of collateral (1)

(1) Fair value is generally determined through independent appraisals of the underlying collateral. The Company may also use another available source of collateral assessment to determine a reasonable estimate of the fair value of the collateral. The valuation generally includes various Level 3 inputs which are not identifiable. Appraisals may be adjusted by management for qualitative factors such as economic factors and estimated liquidation expenses. The range of these possible adjustments may vary.

Summary of Estimated Fair Values of Financial Instruments

The following table presents the carrying amount, estimated fair value, and placement in the fair value hierarchy of the Company’s financial instruments at the dates indicated. This table excludes financial instruments for which the carrying amount approximates fair value. Financial assets for which the fair value approximates carrying value include cash and cash equivalents, FHLBB and FRB stock and accrued interest receivable. Financial liabilities for which the fair value approximates carrying value include non-maturity deposits, short-term borrowings and accrued interest payable.

					Fair Value Measurements
	Carrying Value		Estimated Fair Value		Level 1 Inputs		Level 2 Inputs		Level 3 Inputs
	(In Thousands)
At June 30, 2014
Financial assets:
Investment securities held-to-maturity	$	500	$	500	$	—	$	—	$	500
Loans held-for-sale	13,890		13,890		—		13,890		—
Loans and leases, net	4,552,227		4,522,877		—		—		4,522,877
Financial liabilities:
Certificates of deposit	900,216		903,673		—		903,673		—
Borrowed funds	1,041,004		1,045,320		—		1,045,320		—
At December 31, 2013
Financial assets:
Investment securities held-to-maturity	$	500	$	500	$	—	$	—	$	500
Loans held-for-sale	13,372		13,372		—		13,372		—
Loans and leases, net	4,313,992		4,552,556		—		—		4,552,556
Financial liabilities:
Certificates of deposit	934,668		938,703		—		938,703		—
Borrowed funds	812,555		815,910		—		815,910		—

Investment Securities Held-to-Maturity

The fair values of investment securities held-to-maturity are estimated using pricing models or are based on comparisons to market prices of similar securities and are considered to be Level 3.

Loans Held-for-Sale

Fair value is measured using quoted market prices when available. These assets are typically categorized as Level 1. If quoted market prices are not available, comparable market values may be utilized. These assets are typically categorized as Level 2.

Loans and Leases

The fair values of performing loans and leases were estimated by segregating the portfolio into its primary loan and lease categories—commercial real estate mortgage, multi-family mortgage, construction, commercial, equipment financing, condominium association, indirect automobile, residential mortgage, home equity and other consumer. These categories were further disaggregated based on significant financial characteristics such as type of interest rate (fixed / variable) and payment status (current / past-due). The Company discounts the contractual cash flows for each loan category using interest rates currently being offered for loans with similar terms to borrowers of similar quality and incorporates estimates of future loan prepayments. This method of estimating fair value does not incorporate the exit price concept of fair value.

Deposits

The fair values of deposit liabilities with no stated maturity (demand, NOW, savings and money market savings accounts) are equal to the carrying amounts payable on demand. The fair value of certificates of deposit represents contractual cash flows discounted using interest rates currently offered on deposits with similar characteristics and remaining maturities. The fair value estimates for deposits do not include the benefit that results from the low-cost funding provided by the Company’s core deposit relationships (deposit-based intangibles).

Borrowed Funds

The fair value of federal funds purchased is equal to the amount borrowed. The fair value of FHLBB advances and repurchase agreements represents contractual repayments discounted using interest rates currently available for borrowings with similar characteristics and remaining maturities. The fair values reported for retail repurchase agreements are based on the discounted value of contractual cash flows. The discount rates used are representative of approximate rates currently offered on borrowings with similar characteristics and maturities. The fair values reported for subordinated deferrable interest debentures are based on the discounted value of contractual cash flows. The discount rates used are representative of approximate rates currently offered on instruments with similar terms and maturities.