EX-99.1 2 ex99-1.htm EXHIBIT 99.1 PRESS RELEASE ex99-1.htm
Exhibit 99.1
 
First Connecticut Bancorp, Inc. Announces First Quarter 2014 Earnings of $0.10 per share

FARMINGTON, Conn., April 24, 2014 – First Connecticut Bancorp, Inc. (the “Company”) (NASDAQ: FBNK), the holding company for Farmington Bank (the “Bank”), reported net interest income of $14.8 million and net income of $1.5 million for the quarter ended March 31, 2014.  Diluted earnings per share were $0.10 compared with $0.07 per diluted share for the fourth quarter of 2013 and $0.05 per diluted share for the first quarter of 2013.

“Our first quarter earnings of $0.10 per share reflects the significant investment made in people, technology and franchise over the past several years. Our continued focus toward organic growth, process improvement and expense reduction are strongly reflected in our first quarter results,” stated John J. Patrick Jr., First Connecticut Bancorp’s Chairman, President & CEO.

“Our net interest income continues to grow from core banking activities, while expenses have reduced over the prior year and linked quarter.  Despite the extreme winter weather conditions in the Northeast, both loan and deposit growth remained strong during the quarter.”

Financial Highlights

·  
Net interest income increased $419,000 to $14.8 million in the first quarter of 2014 compared to $14.3 million in the linked quarter and increased $2.1 million compared to first quarter of 2013.

·  
Noninterest expense to average assets was 2.63% in the first quarter of 2014 compared to 2.80% in the linked quarter and 3.28% in the first quarter of 2013.

·  
Strong organic loan growth continued during the quarter as total loans increased $52.5 million to $1.9 billion at March 31, 2014 and increased $310.1 million or 20% from a year ago.

·  
Tangible book value per share grew to $14.22 compared to $14.11 on a linked quarter basis and $13.78 at March 31, 2013.

·  
Checking accounts grew by 3.2% or 1,266 net new accounts in the first quarter of 2014.

·  
Net charge-offs were $1.2 million in the first quarter of 2014 compared to $24,000 in the linked quarter.  One commercial loan relationship represented the majority of the charge-off which was fully reserved in prior years.

·  
Asset quality remains stable as loan delinquencies 30 days and greater decreased slightly to 0.80% of total loans at March 31, 2014 compared to 0.85% of total loans at December 31, 2013.  Non-accrual loans represented 0.69% of total loans compared to 0.81% of total loans on a linked quarter basis.

·  
During the first quarter of 2014, we repurchased 253,709 shares of common stock at an average price per share of $15.49 at a total cost of $3.9 million.  Repurchased shares will be held as treasury stock and will be available for general corporate purposes.

·  
We paid a cash dividend of $0.03 per share on March 17, 2014. This marks the tenth consecutive quarter we have paid a dividend since First Connecticut Bancorp, Inc. became a public company on June 29, 2011.
 
 
 
First quarter 2014 compared with fourth quarter 2013

Net interest income

·  
Net interest income increased $419,000 to $14.8 million in the first quarter of 2014 compared to the linked quarter due primarily to a $52.1 million increase in the average loan balance, lower cost of interest-bearing liabilities, higher yields in the loan and securities portfolios and a 7 basis point increase in the net interest rate spread to 2.86%.

·
  
Net interest margin increased 5 basis points to 2.99% in the first quarter of 2014 compared to 2.94% in the fourth quarter of 2013 primarily due to a decrease in cost of interest-bearing liabilities and higher yields in the loan and securities portfolios.

·   
The cost of interest-bearing liabilities declined 5 basis points to 58 basis points in the first quarter of 2014 compared to 63 basis points in the fourth quarter of 2013.

Provision for loan losses

·  
Provision for loan losses was $505,000 for the first quarter of 2014 compared to $660,000 for the linked quarter.

·  
Net charge-offs in the quarter were $1.2 million or 0.26% to average loans (annualized) compared to $24,000 or 0.01% to average loans (annualized) in the linked quarter.

·  
The allowance for loan losses represented 0.94% of total loans at March 31, 2014 compared to 1.01% at December 31, 2013.

Noninterest income

·  
Total noninterest income decreased $421,000 to $1.8 million for the first quarter of 2014 compared to the linked quarter primarily due to a $459,000 decrease in net gain on loans sold as a result of an overall decrease in volume and margins in our secondary market residential lending program.

Noninterest expense

·  
Noninterest expense decreased $438,000 or 3% to $14.0 million in the first quarter of 2014 compared to the linked quarter as a result of decreases in salaries and employee benefits and other operating expenses offset by an increase in occupancy expense due to our de novo branch in Rocky Hill, which opened in January 2014, and winter related expenses.

Income tax provision

·  
Income tax provision was $555,000 in the first quarter of 2014 compared to $322,000 in the linked quarter.
 
 
 
First quarter 2014 compared with first quarter 2013

Net interest income

·  
Net interest income increased $2.1 million or 17% to $14.8 million compared to $12.7 million in the first quarter of 2013 primarily due to a $296.8 million increase in the average loan balance despite a 23 basis point decrease in the yield on loans.

·  
Net interest margin decreased 8 basis points to 2.99% in the first quarter of 2014 compared to 3.07% in the first quarter of 2013 primarily due to lower prepayment penalty fees and a $20.7 million decline in the average balance of the resort portfolio.  Excluding resort and prepayment penalty fee income for both quarters, the net interest margin would have been 2.99% and 3.00% in the first quarters of 2014 and 2013, respectively.

·  
The cost of interest-bearing liabilities declined 19 basis points to 58 basis points in the first quarter of 2014 compared to 77 basis points in the first quarter of 2013 due primarily to lower funding costs for municipal deposits and a decrease in Federal Home Loan Bank of Boston advance costs due to an increase in short-term advances which carry lower rates.

Provision for loan losses

·  
Provision for loan losses was $505,000 for the first quarter of 2014 compared to $399,000 for the prior year quarter.

·  
Net charge-offs in the quarter were $1.2 million or 0.26% to average loans (annualized) compared to $296,000 or 0.08% to average loans (annualized) in the prior year quarter.

·  
The allowance for loan losses represented 0.94% of total loans at March 31, 2014 compared to 1.11% at March 31, 2013.

Noninterest income

·  
Total noninterest income decreased $1.9 million to $1.8 million compared to the prior year quarter primarily due to a $1.9 million decrease in net gain on loans sold as a result of an overall decrease in volume and margins in our secondary market residential lending program.

Noninterest expense

·  
Noninterest expense, excluding $633,000 in accelerated vesting of stock compensation due to the passing of a key executive in the prior year quarter, decreased $106,000 to $14.0 million in the first quarter of 2014 compared to the prior year quarter.

·  
Salaries and employee benefits, excluding $633,000 in accelerated vesting of stock compensation, decreased $113,000 to $8.3 million in the first quarter of 2014 compared to the prior year quarter.

·  
Marketing expense decreased $216,000 or 37% compared to the prior year quarter primarily due to general expense control initiatives.

Income tax provision

·  
Income tax provision was $555,000 in the first quarter of 2014 compared to $316,000 in the prior year quarter.
 
 
 
Financial condition

·  
Total assets increased $382.1 million or 21% at March 31, 2014 to $2.2 billion compared to $1.8 billion at March 31, 2013 largely reflecting an increase in loans and securities.

·  
Our investment portfolio totaled $176.1 million at March 31, 2014 compared to $111.8 million at March 31, 2013, an increase of $64.3 million.

·  
Net loans increased $309.8 million at March 31, 2014 to $1.9 billion compared to $1.5 million at March 31, 2013 due to our continued focus on commercial and residential lending, which combined, increased $326.4 million.

·  
Deposits increased $258.3 million at March 31, 2014 to $1.6 billion compared to $1.4 billion at March 31, 2013, due to increases in municipal deposits, noninterest-bearing deposits and de novo branch openings as we continue to develop and grow relationships in the geographical areas we serve.

·  
Federal Home Loan Bank of Boston advances increased $130.0 million to $206.0 million at March 31, 2014 compared to $76.0 million at March 31, 2013.  Advances were used to support loan and securities growth.

Asset Quality

·  
At March 31, 2014, the allowance for loan losses represented 0.94% of total loans and 135.89% of non-accrual loans, compared to 1.11% of total loans and 124.59% of non-accrual loans at March 31, 2013.

·  
Non-accrual loans represented 0.69% of total loans at March 31, 2014 compared to 0.89% of total loans at March 31, 2013.

·  
Loan delinquencies 30 days and greater decreased to 0.80% of total loans at March 31, 2014 compared to 0.97% of total loans at March 31, 2013.

Capital and Liquidity

·  
The Company remained well-capitalized with an estimated total capital to risk-weighted asset ratio of 15.05% at March 31, 2014.

·  
Tangible book value per share grew to $14.22 compared to $14.11 on a linked quarter basis and $13.78 at the quarter ended March 31, 2013.

·  
At March 31, 2014, the Company continued to have adequate liquidity including significant unused borrowing capacity at the Federal Home Loan Bank of Boston and the Federal Reserve Bank, as well as access to funding through brokered deposits.

About First Connecticut Bancorp, Inc.

First Connecticut Bancorp, Inc. (NASDAQ: FBNK) is a Maryland-chartered stock holding company that wholly owns Farmington Bank. Farmington Bank is a full-service, community bank with 22 branch locations throughout central Connecticut. Established in 1851, Farmington Bank is a diversified consumer and commercial bank with an ongoing commitment to contribute to the betterment of the communities in our region. For more information regarding the Bank’s products and services and for First Connecticut Bancorp, Inc. investor relations information, please visit www.farmingtonbankct.com.
 
 
 
Conference Call

First Connecticut will host a conference call on Thursday, April 24, 2014 at 10:30am Eastern Time to discuss first quarter results.  Those wishing to participate in the call may dial-in to the call at 1-888-317-6016.  The international dial-in number is 1-412-317-6016.  A webcast of the call will be available on the Investor Relations Section of the Farmington Bank website for an extended period of time.

Forward Looking Statements

In addition to historical information, this earnings release may contain forward-looking statements for purposes of applicable securities laws. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Such forward-looking statements may or may not include words such as “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” Forward-looking statements are subject to numerous assumptions, risks and uncertainties. There are a number of important factors described in documents previously filed by the Company with the Securities and Exchange Commission, and other factors that could cause the Company's actual results to differ materially from those contemplated by such forward-looking statements. The Company undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.

Non-GAAP Financial Measures

In addition to evaluating the Company’s financial performance in accordance with U.S. generally accepted accounting principles (“GAAP”), management routinely supplements their evaluation with an analysis of certain non-GAAP financial measures, such as core net income, the efficiency ratio and tangible book value per share. A reconciliation to the most directly comparable GAAP financial measure; net income in the case of core net income and the efficiency ratio and stockholders’ equity in the case of tangible book value per share, appears in tabular form in the accompanying Reconciliation of Non-GAAP Financial Measures table.

We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. Specifically, we provide measures based on what we believe are our operating earnings on a consistent basis and exclude non-core operating items which affect the GAAP reporting of results of operations. The Company believes that core net income is useful for both investors and management to understand the effects of items that are non-recurring and infrequent in nature. The Company believes that the efficiency ratio, which measures the costs expended to generate a dollar of revenue, is useful in the assessment of financial performance, including non-interest expense control. The Company believes that tangible book value per share is useful to evaluate the relative strength of the Company’s capital position. The Company does not have goodwill and intangible assets for any of the periods presented. As such, tangible book value per common share is equal to book value per common share.
 
 
We utilize these measures for internal planning and forecasting purposes. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure.
 
 
 
 
 
First Connecticut Bancorp, Inc.
Selected Financial Data (Unaudited)
 
At or for the Three Months Ended
 
March 31,
  
December 31,
September 30,
June 30,
  
March 31,
(Dollars in thousands, except per share data)
2014
  
2013
  
2013
  
2013
  
2013
Selected Financial Condition Data:
                  
                   
Total assets
 $    2,181,759
  
 $    2,110,028
  
 $    1,992,517
  
 $    1,845,440
  
 $    1,799,678
Cash and cash equivalents
           44,110
  
           38,799
  
           50,323
  
           36,650
  
           34,946
Securities held-to-maturity, at amortized cost
           12,872
  
           12,983
  
             3,002
  
             3,003
  
             3,003
Securities available-for-sale, at fair value
         163,232
  
         150,886
  
         120,382
  
         112,801
  
         108,787
Federal Home Loan Bank of Boston stock, at cost
           13,137
  
           13,136
  
             8,383
  
             8,383
  
             8,383
Loans, net
       1,854,497
  
       1,800,987
  
       1,712,507
  
       1,588,080
  
       1,544,687
Deposits
       1,634,400
  
       1,513,501
  
       1,550,627
  
       1,452,319
  
       1,376,092
Federal Home Loan Bank of Boston advances
         206,000
  
         259,000
  
         104,000
  
           51,250
  
           76,000
Total stockholders' equity
         230,488
  
         232,209
  
         227,864
  
         231,541
  
         243,214
Allowance for loan losses
           17,631
  
           18,314
  
           17,678
  
           17,505
  
           17,332
Non-accrual loans
           12,974
  
           14,800
  
           13,887
  
           14,325
  
           13,911
Impaired loans
           41,782
  
           39,623
  
           42,587
  
           39,159
  
           39,210
Loan delinquencies 30 days and greater
           14,882
  
           15,511
  
           15,032
  
           15,191
  
           15,167
                   
Selected Operating Data:
                  
                   
Interest income
 $        16,980
  
 $        16,697
  
 $        15,806
  
 $        15,336
  
 $        15,047
Interest expense
             2,230
  
             2,366
  
             2,523
  
             2,449
  
             2,395
    Net interest income
           14,750
  
           14,331
  
           13,283
  
           12,887
  
           12,652
    Provision for loan losses
                505
  
                660
  
                215
  
                256
  
                399
Net interest income after provision for loan losses
           14,245
  
           13,671
  
           13,068
  
           12,631
  
           12,253
Noninterest income
             1,762
  
             2,183
  
             2,182
  
             2,999
  
             3,648
Noninterest expense
           13,960
  
           14,398
  
           14,110
  
           14,555
  
           14,699
Income before income taxes
             2,047
  
             1,456
  
             1,140
  
             1,075
  
             1,202
Provision for income taxes
                555
  
                322
  
                275
  
                256
  
                316
                   
Net income
 $          1,492
  
 $          1,134
  
 $             865
  
 $             819
  
 $             886
                   
Performance Ratios (annualized):
                  
                   
Return on average assets
0.28%
  
0.22%
  
0.18%
  
0.18%
  
0.20%
Return on average equity
2.56%
  
1.96%
  
1.49%
  
1.39%
  
1.45%
Interest rate spread (1)
2.86%
  
2.80%
  
2.77%
  
2.83%
  
2.89%
Net interest rate margin (2)
2.99%
  
2.94%
  
2.94%
  
3.01%
  
3.07%
Non-interest expense to average assets
2.63%
  
2.80%
  
2.95%
  
3.17%
  
3.28%
Efficiency ratio (3)
84.54%
  
87.19%
  
91.24%
  
91.62%
  
90.18%
Average interest-earning assets to average
                
     interest-bearing liabilities
128.59%
  
129.64%
  
130.77%
  
132.30%
  
132.02%
                   
Asset Quality Ratios:
                  
                   
Allowance for loan losses as a percent of total loans
0.94%
  
1.01%
  
1.02%
  
1.09%
  
1.11%
Allowance for loan losses as a percent of
                
     non-accrual loans
135.89%
  
123.74%
  
127.30%
  
122.20%
  
124.59%
Net charge-offs to average loans (annualized)
0.26%
  
0.01%
  
0.01%
  
0.02%
  
0.08%
Non-accrual loans as a percent of total loans
0.69%
  
0.81%
  
0.80%
  
0.89%
  
0.89%
Non-accrual loans as a percent of total assets
0.59%
  
0.70%
  
0.70%
  
0.78%
  
0.77%
Loan delinquencies 30 days and greater as a
                
     percent of total loans
0.80%
  
0.85%
  
0.87%
  
0.95%
  
0.97%
                   
Per Share Related Data:
                  
                   
Basic earnings per share
 $              0.10
  
 $              0.07
  
 $              0.06
  
 $              0.05
  
 $              0.05
Diluted earnings per share
 $              0.10
  
 $              0.07
  
 $              0.06
  
 $              0.05
  
 $              0.05
Dividends declared per share
 $              0.03
  
 $              0.03
  
 $              0.03
  
 $              0.03
  
 $              0.03
Tangible book value (4)
 $            14.22
  
 $            14.11
  
 $            13.88
  
 $            13.81
  
 $            13.78
Common stock shares outstanding
16,203,933
  
16,457,642
  
16,416,427
  
16,763,516
  
17,644,449
                   
                   
(1) Represents the difference between the weighted-average yield on average interest-earning assets and the weighted-average cost of interest-bearing liabilities.
(2) Represents net interest income as a percent of average interest-earning assets.
        
(3) Represents noninterest expense divided by the sum of net interest income and noninterest income, adjusted for non-recurring items. See "Reconciliation of Non-GAAP Financial Measures" table.
(4) Represents ending stockholders’ equity less goodwill and intangible assets (excluding mortgage servicing rights) divided by ending common shares outstanding. The Company does not have goodwill and intangible assets for any of the periods presented. See "Reconciliation of Non-GAAP Financial Measures" table.
 
 
 
First Connecticut Bancorp, Inc.
Selected Financial Data (Unaudited)
 
 
At or for the Three Months Ended
                   
 
March 31,
  
December 31,
  
September 30,
  
June 30,
  
March 31,
(Dollars in thousands)
2014
  
2013
  
2013
  
2013
  
2013
Capital Ratios:
                  
                   
Equity to total assets at end of period
10.56%
  
11.01%
  
11.44%
  
12.55%
  
13.51%
Average equity to average assets
10.99%
  
11.23%
  
12.11%
  
12.84%
  
13.65%
Total capital to risk-weighted assets
15.05%
*
15.50%
  
16.13%
  
17.49%
  
18.63%
Tier I capital to risk-weighted assets
13.97%
*
14.36%
  
14.97%
  
16.26%
  
17.39%
Tier I capital to total average assets
11.02%
*
11.47%
  
12.20%
  
12.93%
  
13.91%
Total equity to total average assets
10.85%
  
11.30%
  
11.90%
  
12.61%
  
13.58%
                   
* Estimated
                  
                   
Loans and Allowance for Loan Losses:
                  
                   
Real estate
                  
  Residential
$       716,836
  
$         693,046
  
$       674,804
  
$       625,345
  
$       619,741
  Commercial
         677,948
  
          633,764
  
         585,628
  
         533,072
  
         504,722
  Construction
           69,476
  
            78,191
  
           90,033
  
           80,198
  
           66,508
Installment
             4,109
  
              4,516
  
             4,671
  
             5,384
  
             5,949
Commercial
         244,075
  
          252,032
  
         213,103
  
         199,328
  
         200,610
Collateral
             1,455
  
              1,600
  
             1,819
  
             1,801
  
             1,945
Home equity line of credit
         153,619
  
          151,606
  
         147,026
  
         144,548
  
         143,992
Demand
               124
  
                  85
  
                    -
  
                    -
  
                    -
Revolving credit
                 80
  
                  94
  
                 78
  
                 62
  
                 73
Resort
             1,124
  
              1,374
  
             9,849
  
           12,425
  
           15,252
    Total loans
1,868,846
  
1,816,308
  
1,727,011
  
1,602,163
  
1,558,792
Less:
                  
 Allowance for loan losses
          (17,631)
  
           (18,314)
  
          (17,678)
  
          (17,505)
  
          (17,332)
 Net deferred loan costs
             3,282
  
              2,993
  
             3,174
  
             3,422
  
             3,227
    Loans, net
 $    1,854,497
  
 $     1,800,987
  
 $    1,712,507
  
 $    1,588,080
  
 $    1,544,687
                   
Deposits:
                  
                   
Noninterest-bearing demand deposits
$       303,966
  
$         308,459
  
$       278,275
  
$       275,781
  
$       245,912
Interest-bearing
                  
  NOW accounts
         368,700
  
          285,392
  
         339,350
  
         280,462
  
         234,450
  Money market
         427,535
  
          387,225
  
         386,682
  
         349,621
  
         352,759
  Savings accounts
         199,532
  
          193,937
  
         187,040
  
         191,688
  
         186,171
  Time deposits
         334,667
  
          338,488
  
         359,280
  
         354,767
  
         356,800
Total interest-bearing deposits
      1,330,434
  
        1,205,042
  
      1,272,352
  
      1,176,538
  
      1,130,180
    Total deposits
$     1,634,400
  
$      1,513,501
  
$     1,550,627
  
$     1,452,319
  
$     1,376,092
 
 
 
First Connecticut Bancorp, Inc.
Consolidated Statements of Condition (Unaudited)
             
March 31,
  
December 31,
  
March 31,
             
2014
  
2013
  
2013
(Dollars in thousands)
          
Assets
                
Cash and cash equivalents
$            44,110
  
$            38,799
  
$            34,946
Securities held-to-maturity, at amortized cost
12,872
  
12,983
  
3,003
Securities available-for-sale, at fair value
163,232
  
150,886
  
108,787
Loans held for sale
3,035
  
3,186
  
6,601
Loans, net
  
1,854,497
  
1,800,987
  
1,544,687
Premises and equipment, net
20,436
  
20,619
  
20,764
Federal Home Loan Bank of Boston stock, at cost
13,137
  
13,136
  
8,383
Accrued income receivable
4,973
  
4,917
  
4,346
Bank-owned life insurance
38,838
  
38,556
  
37,649
Deferred income taxes
14,603
  
14,884
  
15,632
Prepaid expenses and other assets
12,026
  
11,075
  
14,880
      Total assets
$       2,181,759
  
$       2,110,028
  
$       1,799,678
                       
Liabilities and Stockholders' Equity
          
Deposits
              
 
Interest-bearing
$       1,330,434
  
$       1,205,042
  
$       1,130,180
 
Noninterest-bearing
303,966
  
308,459
  
245,912
             
1,634,400
  
1,513,501
  
1,376,092
Federal Home Loan Bank of Boston advances
206,000
  
259,000
  
76,000
Repurchase agreement borrowings
21,000
  
21,000
  
21,000
Repurchase liabilities
52,893
  
50,816
  
43,353
Accrued expenses and other liabilities
36,978
  
33,502
  
40,019
      Total liabilities
1,951,271
  
1,877,819
  
1,556,464
                       
Commitments and contingencies
-
  
-
  
-
                       
Stockholders' Equity
          
 
Common stock
181
  
181
  
181
 
Additional paid-in-capital
176,602
  
175,766
  
173,723
 
Unallocated common stock held by ESOP
(13,485)
  
(13,747)
  
(14,545)
 
Treasury stock, at cost
(26,543)
  
(22,599)
  
(5,713)
 
Retained earnings
97,830
  
96,832
  
95,361
 
Accumulated other comprehensive loss
(4,097)
  
(4,224)
  
(5,793)
      Total stockholders' equity
230,488
  
232,209
  
243,214
      Total liabilities and stockholders' equity
$       2,181,759
  
$       2,110,028
  
$       1,799,678
 
 
 
First Connecticut Bancorp, Inc.
Consolidated Statements of Income (Unaudited)
             
Three Months Ended
             
March 31,
  
December 31,
March 31,
(Dollars in thousands, except per share data)
2014
  
2013
  
2013
Interest income
          
Interest and fees on loans
          
 
Mortgage
$        13,428
  
$        13,007
  
$        11,468
 
Other
    
3,208
  
3,437
  
3,314
Interest and dividends on investments
          
 
United States Government and agency obligations
189
  
134
  
139
 
Other bonds
58
  
53
  
59
 
Corporate stocks
93
  
64
  
62
Other interest income
4
  
2
  
5
      Total interest income
16,980
  
16,697
  
15,047
Interest expense
          
Deposits
  
1,694
  
1,736
  
1,705
Interest on borrowed funds
319
  
398
  
469
Interest on repo borrowings
177
  
181
  
171
Interest on repurchase liabilities
40
  
51
  
50
      Total interest expense
2,230
  
2,366
  
2,395
      Net interest income
14,750
  
14,331
  
12,652
Provision for allowance for loan losses
505
  
660
  
399
      Net interest income          
        after provision for loan losses
14,245
  
13,671
  
12,253
Noninterest income
          
Fees for customer services
1,191
  
1,251
  
982
Net gain on loans sold
122
  
581
  
2,030
Brokerage and insurance fee income
44
  
40
  
32
Bank owned life insurance income
282
  
301
  
409
Other
      
123
  
10
  
195
      Total noninterest income
1,762
  
2,183
  
3,648
Noninterest expense
          
Salaries and employee benefits
8,288
  
8,691
  
9,034
Occupancy expense
1,349
  
1,181
  
1,240
Furniture and equipment expense
1,018
  
964
  
1,018
FDIC assessment
328
  
329
  
291
Marketing
378
  
368
  
594
Other operating expenses
2,599
  
2,865
  
2,522
      Total noninterest expense
13,960
  
14,398
  
14,699
      Income before income taxes
2,047
  
1,456
  
1,202
Provision for income taxes
555
  
322
  
316
      Net income
$          1,492
  
$          1,134
  
$             886
                       
Earnings per share:
          
 
Basic
    
 $           0.10
  
 $           0.07
  
 $           0.05
 
Diluted
  
             0.10
  
             0.07
  
             0.05
Weighted average shares outstanding:
          
 
Basic
    
14,820,700
  
14,880,971
  
15,940,377
 
Diluted
  
14,920,837
  
14,897,762
  
15,940,377
 
 
 
First Connecticut Bancorp, Inc.
Consolidated Average Balances, Yields and Rates (Unaudited)
 
For The Three Months Ended
 
March 31, 2014
  
December 31, 2013
  
March 31, 2013
 
Average Balance
Interest
and Dividends
Yield/Cost
 
Average Balance
Interest
and Dividends
 Yield/Cost
 
Average Balance
Interest
and Dividends
Yield/Cost
(Dollars in thousands)
                      
Interest-earning assets:
                      
Loans, net
 $ 1,819,567
 $    16,636
3.71%
  
 $ 1,767,468
 $    16,444
3.69%
  
 $1,522,812
 $    14,782
3.94%
Securities
       160,663
302
0.76%
  
       148,653
243
0.65%
  
      126,347
252
0.81%
Federal Home Loan Bank of Boston stock
         13,136
38
1.17%
  
         10,338
8
0.31%
  
          8,809
8
0.37%
Federal funds and other earning assets
           5,858
4
0.28%
  
           5,093
2
0.16%
  
        11,015
5
0.18%
Total interest-earning assets
    1,999,224
16,980
3.44%
  
    1,931,552
16,697
3.43%
  
   1,668,983
15,047
3.66%
Noninterest-earning assets
       125,272
      
       123,891
      
      121,571
    
Total assets
 $ 2,124,496
      
 $ 2,055,443
      
 $1,790,554
    
                       
Interest-bearing liabilities:
                      
NOW accounts
 $    352,428
 $         197
0.23%
  
 $    305,045
 $         172
0.22%
  
 $   233,891
 $         135
0.23%
Money market
       409,161
            684
0.68%
  
       388,503
            732
0.75%
  
      336,400
            586
0.71%
Savings accounts
       193,142
55
0.12%
  
       190,258
51
0.11%
  
      180,440
85
0.19%
Certificates of deposit
       336,286
758
0.91%
  
       346,977
781
0.89%
  
      356,422
899
1.02%
Total interest-bearing deposits
    1,291,017
1,694
0.53%
  
    1,230,783
1,736
0.56%
  
   1,107,153
1,705
0.62%
Advances from the Federal Home Loan Bank
       181,522
319
0.71%
  
       170,000
398
0.93%
  
        80,468
469
2.36%
Repurchase agreement borrowings
         21,000
177
3.42%
  
         21,000
181
3.42%
  
        21,000
171
3.30%
Repurchase liabilities
         61,187
40
0.27%
  
         68,122
51
0.30%
  
        55,573
50
0.36%
Total interest-bearing liabilities
    1,554,726
2,230
0.58%
  
    1,489,905
2,366
0.63%
  
   1,264,194
2,395
0.77%
Noninterest-bearing deposits
       299,620
      
       294,071
      
      239,840
    
Other noninterest-bearing liabilities
         36,625
      
         40,543
      
        42,140
    
Total liabilities
    1,890,971
      
    1,824,519
      
   1,546,174
    
Stockholders' equity
       233,525
      
       230,924
      
      244,380
    
Total liabilities and stockholders' equity
 $ 2,124,496
      
 $ 2,055,443
      
 $1,790,554
    
                       
Net interest income
  
 $    14,750
      
 $    14,331
      
 $    12,652
  
Net interest rate spread (1)
    
2.86%
      
2.80%
      
2.89%
Net interest-earning assets (2)
 $    444,498
      
 $    441,647
      
 $   404,789
    
Net interest margin (3)
    
2.99%
      
2.94%
      
3.07%
Average interest-earning assets
                      
   to average interest-bearing liabilities
128.59%
      
129.64%
      
132.02%
  
                       
(1) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
    
(2) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(3) Net interest margin represents net interest income divided by average total interest-earning assets.
 
 
 
First Connecticut Bancorp, Inc.
Reconcilliation of Non-GAAP Financial Measures (Unaudited)
The table below presents a reconciliation of non-GAAP financial measures with financial measures defined by GAAP for the three months ended March 31, 2014, December 31, 2013, September 30, 2013, June 30, 2013 and March 31, 2013.  The Company believes the use of these non-GAAP financial measures provides additional clarity in assessing the results of the Company.
 
   
At or for the Three Months Ended
                     
   
March 31,
  
December 31,
September 30,
June 30,
  
March 31,
(Dollars in thousands, except per share data)
2014
  
2013
  
2013
  
2013
  
2013
Net Income
 $          1,492
  
 $          1,134
  
 $            865
  
 $           819
  
 $             886
 
Adjustments:
                  
 
Less: Prepayment penalty fees
-
  
(144)
  
-
  
               (20)
  
              (127)
 
Less: Net gain on sales of investments
-
  
-
  
              (304)
  
               (36)
  
-
 
Less: Bank-owned life insurance proceeds (1)
-
  
-
  
-
  
-
  
              (108)
 
Plus: Accelerated vesting of stock compensation (1)
-
  
-
  
-
  
-
  
               633
Total core adjustments before taxes
-
  
(144)
  
(304)
  
               (56)
  
               398
 
Tax benefit (provision) - 34% rate
-
  
49
  
103
  
                19
  
              (135)
Total core adjustments after taxes
-
  
(95)
  
(201)
  
               (37)
  
               263
Total core net income
 $          1,492
  
 $          1,039
  
 $            664
  
 $           782
  
 $          1,149
                     
                     
Total net interest income
 $        14,750
  
 $         14,331
  
 $        13,283
  
 $       12,887
  
 $        12,652
 
Less: Prepayment penalty fees
-
  
(144)
  
-
  
               (20)
  
              (127)
Total core net interest income
 $        14,750
  
 $         14,187
  
 $        13,283
  
 $       12,867
  
 $        12,525
                     
                     
Total noninterest income
 $          1,762
  
 $          2,183
  
 $         2,182
  
 $         2,999
  
 $          3,648
 
Less: Net gain on sales of investments
-
  
-
  
              (304)
  
               (36)
  
-
 
Less: Bank-owned life insurance proceeds (1)
-
  
-
  
-
  
-
  
              (108)
Total core noninterest income
 $          1,762
  
 $          2,183
  
 $         1,878
  
 $         2,963
  
 $          3,540
                     
                     
Total noninterest expense
 $        13,960
  
 $         14,398
  
 $        14,110
  
 $       14,555
  
 $        14,699
 
Less: Accelerated vesting of stock compensation (1)
-
  
-
  
-
  
-
  
              (633)
Total core noninterest expense
 $        13,960
  
 $         14,398
  
 $        14,110
  
 $       14,555
  
 $        14,066
                     
Core earnings per common share, diluted
 $            0.10
  
 $            0.07
  
 $           0.04
  
 $          0.05
  
 $            0.07
                     
Core return on assets (annualized)
0.28%
  
0.20%
  
0.14%
  
0.17%
  
0.26%
Core return on equity (annualized)
2.56%
  
1.80%
  
1.14%
  
1.33%
  
1.88%
Efficiency ratio (2)
84.54%
  
87.95%
  
93.07%
  
91.95%
  
87.56%
                     
Tangible book value (3)
 $          14.22
  
 $          14.11
  
 $         13.88
  
 $         13.81
  
 $          13.78
                     
(1) Represents the accelerated vesting of stock compensation and insurance proceeds due to the passing of a key executive in the first quarter of 2013.
                     
(2) Represents core noninterest expense divided by the sum of net core interest income and core noninterest income.
                     
(3) Represents ending stockholders’ equity less goodwill and intangible assets (excluding mortgage servicing rights) divided by ending common shares outstanding. The Company does not have goodwill and intangible assets for any of the periods presented.