x
|
Quarterly Report-
Pursuant To Section 13 or 15(d) of the Securities Exchange Act of 1934
|
o
|
Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
Maryland
|
45-1496206
|
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification Number)
|
|
One Farm Glen Boulevard, Farmington, CT
|
06032
|
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
Large accelerated filer
|
o
|
|
Accelerated filer
|
o
|
||
Non-accelerated filer
|
x
|
|
Smaller reporting company
|
o
|
Page
|
||||
Part I. Financial Information
|
||||
Item 1.
|
Consolidated Financial Statements
|
|||
Consolidated Statements of Condition at June 30, 2012 (unaudited) and December 31, 2011
|
1
|
|||
Consolidated Statements of Operations for the three and six months ended June 30, 2012 and 2011 (unaudited)
|
2
|
|||
Consolidated Statements of Comprehensive Income (Loss) for the six months ended June 30, 2012 and 2011 (unaudited)
|
3
|
|||
Consolidated Statement of Stockholders’ Equity for the six months ended June 30, 2012 (unaudited)
|
4
|
|||
Consolidated Statements of Cash Flows for the six months ended June 30, 2012 and 2011 (unaudited)
|
5
|
|||
Notes to Unaudited Consolidated Financial Statements
|
6
|
|||
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
41
|
||
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
61
|
||
Item 4.
|
Controls and Procedures
|
62
|
||
Part II. Other Information
|
||||
Item 1.
|
Legal Proceedings
|
62
|
||
Item1A. | Risk Factors | 63 | ||
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
63
|
||
Item 3.
|
Defaults Upon Senior Securities
|
63
|
||
Item 4.
|
Mine Safety Disclosure
|
63
|
||
Item 5.
|
Other Information
|
63
|
||
Item 6.
|
Exhibits
|
63
|
||
Signatures
|
65
|
|||
Exhibit 31.1
|
||||
Exhibit 31.2
|
||||
Exhibit 32.1
|
||||
Exhibit 32.2
|
Consolidated Statements of Condition | ||||||||
June 30, 2012
|
December 31,
2011
|
|||||||
(Dollars in thousands)
|
(Unaudited)
|
|
||||||
Assets
|
||||||||
Cash and due from banks
|
$ | 36,727 | $ | 40,296 | ||||
Federal funds sold
|
- | 50,000 | ||||||
Cash and cash equivalents
|
36,727 | 90,296 | ||||||
Securities held-to-maturity, at amortized cost
|
3,007 | 3,216 | ||||||
Securities available-for-sale, at fair value
|
130,386 | 135,170 | ||||||
Loans held for sale
|
1,667 | 1,039 | ||||||
Loans, net
|
1,415,732 | 1,295,177 | ||||||
Premises and equipment, net
|
21,514 | 21,379 | ||||||
Federal Home Loan Bank of Boston stock, at cost
|
7,137 | 7,449 | ||||||
Accrued income receivable
|
4,174 | 4,185 | ||||||
Bank-owned life insurance
|
37,022 | 30,382 | ||||||
Deferred income taxes
|
13,735 | 13,907 | ||||||
Prepaid expenses and other assets
|
16,330 | 15,450 | ||||||
Total assets
|
$ | 1,687,431 | $ | 1,617,650 | ||||
Liabilities and Stockholders’ Equity
|
||||||||
Deposits
|
||||||||
Interest-bearing
|
$ | 994,923 | $ | 981,057 | ||||
Noninterest-bearing
|
223,820 | 195,625 | ||||||
1,218,743 | 1,176,682 | |||||||
Federal Home Loan Bank of Boston advances
|
91,000 | 63,000 | ||||||
Repurchase agreement borrowings
|
21,000 | 21,000 | ||||||
Repurchase liabilities
|
67,534 | 64,466 | ||||||
Accrued expenses and other liabilities
|
41,049 | 40,522 | ||||||
Total liabilities
|
1,439,326 | 1,365,670 | ||||||
Commitments and contingencies
|
- | - | ||||||
Stockholders’ Equity
|
||||||||
Common stock, $0.01 par value, 30,000,000 shares authorized, 17,880,200 shares issued and outstanding at June 30, 2012 and December 31, 2011
|
179 | 179 | ||||||
Additional paid-in-capital
|
174,929 | 174,836 | ||||||
Unallocated common stock held by ESOP
|
(15,340 | ) | (10,490 | ) | ||||
Retained earnings
|
93,687 | 92,937 | ||||||
Accumulated other comprehensive loss
|
(5,350 | ) | (5,482 | ) | ||||
Total stockholders’ equity
|
248,105 | 251,980 | ||||||
Total liabilities and stockholders’ equity
|
$ | 1,687,431 | $ | 1,617,650 |
First Connecticut Bancorp, Inc.
|
Consolidated Statements of Operations (Unaudited)
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
(Dollars in thousands, except per share data)
|
||||||||||||||||
Interest income
|
||||||||||||||||
Interest and fees on loans
|
||||||||||||||||
Mortgage
|
$ | 10,882 | $ | 10,595 | $ | 21,992 | $ | 21,143 | ||||||||
Other
|
3,859 | 3,536 | 7,748 | 7,148 | ||||||||||||
Interest and dividends on investments
|
||||||||||||||||
United States Government and agency obligations
|
249 | 360 | 515 | 795 | ||||||||||||
Other bonds
|
60 | 54 | 118 | 106 | ||||||||||||
Corporate stocks
|
70 | 71 | 140 | 138 | ||||||||||||
Other interest income
|
26 | 58 | 60 | 75 | ||||||||||||
Total interest income
|
15,146 | 14,674 | 30,573 | 29,405 | ||||||||||||
Interest expense
|
. | |||||||||||||||
Deposits
|
1,643 | 1,954 | 3,398 | 3,906 | ||||||||||||
Interest on borrowed funds
|
462 | 531 | 943 | 1,056 | ||||||||||||
Interest on repo borrowings
|
181 | 179 | 361 | 358 | ||||||||||||
Interest on repurchase liabilities
|
61 | 96 | 118 | 220 | ||||||||||||
Total interest expense
|
2,347 | 2,760 | 4,820 | 5,540 | ||||||||||||
Net interest income
|
12,799 | 11,914 | 25,753 | 23,865 | ||||||||||||
Provision for allowance for loan losses
|
520 | 300 | 850 | 600 | ||||||||||||
Net interest income after provision for loan losses
|
12,279 | 11,614 | 24,903 | 23,265 | ||||||||||||
Noninterest income
|
||||||||||||||||
Fees for customer services
|
900 | 860 | 1,716 | 1,647 | ||||||||||||
Net gain on loans sold
|
431 | 199 | 529 | 345 | ||||||||||||
Brokerage and insurance fee income
|
32 | 10 | 57 | 134 | ||||||||||||
Bank owned life insurance income
|
321 | 174 | 640 | 348 | ||||||||||||
Other
|
322 | 186 | 377 | 236 | ||||||||||||
Total noninterest income
|
2,006 | 1,429 | 3,319 | 2,710 | ||||||||||||
Noninterest expense
|
||||||||||||||||
Salaries and employee benefits
|
7,619 | 7,473 | 15,043 | 14,041 | ||||||||||||
Occupancy expense
|
1,098 | 1,094 | 2,288 | 2,331 | ||||||||||||
Furniture and equipment expense
|
1,112 | 990 | 2,211 | 1,965 | ||||||||||||
FDIC assessment
|
294 | 529 | 573 | 1,070 | ||||||||||||
Marketing
|
753 | 658 | 1,359 | 1,131 | ||||||||||||
Contribution to Farmington Bank Community Foundation, Inc.
|
- | 6,877 | - | 6,877 | ||||||||||||
Other operating expenses
|
2,285 | 2,306 | 4,316 | 4,173 | ||||||||||||
Total noninterest expense
|
13,161 | 19,927 | 25,790 | 31,588 | ||||||||||||
Income before income taxes
|
1,124 | (6,884 | ) | 2,432 | (5,613 | ) | ||||||||||
Provision for (benefit from) income taxes
|
293 | (2,239 | ) | 610 | (1,984 | ) | ||||||||||
Net income (loss)
|
$ | 831 | $ | (4,645 | ) | $ | 1,822 | $ | (3,629 | ) | ||||||
Net income (loss) per share (See Note 2):
|
||||||||||||||||
Basic and Diluted (1):
|
$ | 0.05 | $ | (0.26 | ) | $ | 0.11 | N/A | ||||||||
Weighted average shares outstanding:
|
||||||||||||||||
Basic and Diluted
|
16,686,810 | 17,581,225 | 16,735,892 | N/A | ||||||||||||
Pro forma net loss per share (2):
|
||||||||||||||||
Basic and Diluted
|
N/A | $ | (0.26 | ) | N/A | $ | (0.21 | ) |
First Connecticut Bancorp, Inc.
|
Consolidated Statements of Comprehensive Income (Loss) (Unaudited)
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
|
2012
|
2011
|
2012
|
2011
|
||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Net income (loss)
|
$ | 831 | $ | (4,645 | ) | $ | 1,822 | $ | (3,629 | ) | ||||||
Other comprehensive income (loss), before tax
|
||||||||||||||||
Unrealized gains (losses) on securities:
|
||||||||||||||||
Unrealized holding gains (losses) arising during the period
|
(318 | ) | 131 | (65 | ) | 29 | ||||||||||
Less: reclassification adjustment for gains (losses) included in net income
|
- | - | - | - | ||||||||||||
Net change in unrealized gains (losses)
|
(318 | ) | 131 | (65 | ) | 29 | ||||||||||
Change related to employee benefit plans
|
133 | 53 | 265 | 107 | ||||||||||||
Other comprehensive income (loss), before tax
|
(185 | ) | 184 | 200 | 136 | |||||||||||
Income tax provision (benefit)
|
(63 | ) | 62 | 68 | 46 | |||||||||||
Other comprehensive income (loss), net of tax
|
(122 | ) | 122 | 132 | 90 | |||||||||||
Comprehensive income (loss)
|
$ | 709 | $ | (4,523 | ) | $ | 1,954 | $ | (3,539 | ) |
First Connecticut Bancorp, Inc. |
Consolidated Statement of Changes in Stockholders’ Equity (Unaudited) |
Accumulated Other
|
||||||||||||||||||||||||||||||||
Comprehensive (Loss) Income
|
||||||||||||||||||||||||||||||||
Unrealized Gain
|
Related to
|
|||||||||||||||||||||||||||||||
Unallocated
|
on Securities
|
Employee Benefits
|
||||||||||||||||||||||||||||||
Additional
|
Common
|
Available-for-Sale,
|
Plans,
|
|||||||||||||||||||||||||||||
Common Stock
|
Paid in
|
Shares Held
|
Retained
|
Net of
|
Net of
|
|||||||||||||||||||||||||||
|
Shares
|
Amount
|
Capital
|
by ESOP
|
Earnings
|
Tax Effect
|
Tax Effect
|
Total
|
||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||
Balance at December 31, 2011
|
17,880,200 | $ | 179 | $ | 174,836 | $ | (10,490 | ) | $ | 92,937 | $ | 650 | $ | (6,132 | ) | $ | 251,980 | |||||||||||||||
Purchase of common stock for Employee Stock Ownership Plan “ESOP”
|
- | - | - | (5,376 | ) | - | - | - | (5,376 | ) | ||||||||||||||||||||||
ESOP shares released and committed to be released
|
- | - | 93 | 526 | - | - | - | 619 | ||||||||||||||||||||||||
Cash dividend paid ($0.06 per common share)
|
- | - | - | - | (1,072 | ) | - | - | (1,072 | ) | ||||||||||||||||||||||
Net income
|
- | - | - | - | 1,822 | - | - | 1,822 | ||||||||||||||||||||||||
Other comprehensive income
|
- | - | - | - | - | (43 | ) | 175 | 132 | |||||||||||||||||||||||
Balance at June 30, 2012
|
17,880,200 | 179 | 174,929 | (15,340 | ) | 93,687 | 607 | (5,957 | ) | 248,105 |
First Connecticut Bancorp, Inc. |
Consolidated Statements of Cash Flows (Unaudited) |
Six Months Ended
|
||||||||
June 30,
|
||||||||
2012
|
2011
|
|||||||
(Dollars in thousands)
|
||||||||
Cash flows from operating activities
|
||||||||
Net income (loss)
|
$ | 1,822 | $ | (3,629 | ) | |||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Provision for allowance for loan losses
|
850 | 600 | ||||||
Provision for off-balance sheet commitments
|
12 | 5 | ||||||
Depreciation and amortization
|
1,626 | 1,549 | ||||||
Amortization of ESOP expense
|
619 | 11 | ||||||
Contribution of stock to Farmington Bank Community Foundation, Inc.
|
- | 6,877 | ||||||
Loans originated for sale
|
(18,105 | ) | (20,975 | ) | ||||
Proceeds from the sale of loans held for sale
|
18,006 | 20,129 | ||||||
Loss on sale of foreclosed real estate
|
18 | - | ||||||
Gain on sale of land
|
(28 | ) | - | |||||
Net gain on loans sold
|
(529 | ) | (345 | ) | ||||
Accretion and amortization of investment security discounts and premiums, net
|
(53 | ) | (63 | ) | ||||
Amortization and accretion of loan fees and discounts, net
|
(670 | ) | (129 | ) | ||||
Deferred income tax
|
104 | (2,077 | ) | |||||
Decrease in accrued income receivable
|
11 | 164 | ||||||
Increase in cash surrender value of bank-owned life insurance
|
(640 | ) | (348 | ) | ||||
Increase in prepaid expenses and other assets
|
(806 | ) | (1,262 | ) | ||||
Increase in accrued expenses and other liabilities
|
781 | 7,760 | ||||||
Net cash provided by operating activities
|
3,018 | 8,267 | ||||||
Cash flow from investing activities
|
||||||||
Maturities of securities held-to-maturity
|
209 | 260 | ||||||
Sales, maturities and calls of securities available-for-sale
|
142,743 | 174,320 | ||||||
Purchases of securities held-to-maturity
|
- | (209 | ) | |||||
Purchases of securities available-for-sale
|
(137,972 | ) | (147,043 | ) | ||||
Redemption of Federal Home Loan Bank of Boston stock
|
312 | - | ||||||
Loan originations, net of principal repayments
|
(120,921 | ) | (19,263 | ) | ||||
Purchases of bank-owned life insurance
|
(6,000 | ) | - | |||||
Proceeds from sale of land
|
249 | - | ||||||
Proceeds from sale of foreclosed real estate
|
94 | 143 | ||||||
Purchases of premises and equipment
|
(1,982 | ) | (801 | ) | ||||
Net cash (used in) provided by investing activities
|
(123,268 | ) | 7,407 | |||||
Cash flows from financing activities
|
||||||||
Proceeds from common stock offering, net of offering cost
|
- | 167,800 | ||||||
Purchase of common stock for ESOP
|
(5,376 | ) | (3,348 | ) | ||||
Net increase (decrease) in borrowings
|
28,000 | (3,000 | ) | |||||
Net increase in demand deposits, NOW accounts, savings accounts and money market accounts
|
65,141 | 112,140 | ||||||
Net decrease in certificates of deposit
|
(23,080 | ) | (42,655 | ) | ||||
Net increase (decrease) in repurchase liabilities
|
3,068 | (26,557 | ) | |||||
Cash dividend paid
|
(1,072 | ) | - | |||||
Net cash provided by financing activities
|
66,681 | 204,380 | ||||||
Net (decrease) increase in cash and cash equivalents
|
(53,569 | ) | 220,054 | |||||
Cash and cash equivalents at beginning of period
|
90,296 | 18,608 | ||||||
Cash and cash equivalents at end of period
|
$ | 36,727 | $ | 238,662 | ||||
Supplemental disclosure of cash flow information
|
||||||||
Cash paid for interest
|
$ | 4,790 | $ | 5,538 | ||||
Cash paid for income taxes
|
6 | 850 | ||||||
Loans transferred to other real estate owned
|
246 | - |
First Connecticut Bancorp, Inc. |
Notes to Consolidated Financial Statements (Unaudited) |
1.
|
Summary of Significant Accounting Policies
|
First Connecticut Bancorp, Inc. |
Notes to Consolidated Financial Statements (Unaudited) |
First Connecticut Bancorp, Inc. |
Notes to Consolidated Financial Statements (Unaudited) |
First Connecticut Bancorp, Inc. |
Notes to Consolidated Financial Statements (Unaudited) |
2.
|
Earnings Per Share
|
For the Three
|
For the Six
|
For the Period from
|
||||||||||
Months Ended
|
Months Ended
|
June 29, 2011 to
|
||||||||||
June 30, 2012
|
June 30, 2012
|
June 30, 2011
|
||||||||||
(Dollars in thousands, except Per Share data):
|
||||||||||||
Net income (loss)
|
$ | 831 | $ | 1,822 | $ | (4,494 | ) | |||||
Weighted-average common shares
|
16,686,810 | 16,735,892 | 17,581,225 | |||||||||
Net income (loss) per common share:
|
||||||||||||
Basic and Diluted
|
$ | 0.05 | $ | 0.11 | $ | (0.26 | ) |
First Connecticut Bancorp, Inc. |
Notes to Consolidated Financial Statements (Unaudited) |
3.
|
Investment Securities
|
June 30, 2012 | ||||||||||||||||
(Dollars in thousands)
|
Amortized
Cost |
Gross
Unrealized |
Gross
Unrealized |
Market
Value |
||||||||||||
Available-for-sale
|
||||||||||||||||
Debt securities:
|
||||||||||||||||
U.S. Treasury obligations
|
$ | 93,985 | $ | 2 | $ | (2 | ) | $ | 93,985 | |||||||
U.S. Government agency obligations
|
12,000 | 18 | - | 12,018 | ||||||||||||
Government sponsored residential mortgage-backed securities
|
14,536 | 1,105 | (2 | ) | 15,639 | |||||||||||
Corporate debt securities
|
2,946 | 197 | - | 3,143 | ||||||||||||
Trust preferred debt securities
|
37 | - | - | 37 | ||||||||||||
Preferred equity securities
|
2,100 | 81 | (529 | ) | 1,652 | |||||||||||
Marketable equity securities
|
348 | 33 | (4 | ) | 377 | |||||||||||
Mutual funds
|
3,515 | 20 | - | 3,535 | ||||||||||||
Total securities available-for-sale
|
$ | 129,467 | $ | 1,456 | $ | (537 | ) | $ | 130,386 | |||||||
Held-to-maturity
|
||||||||||||||||
Government sponsored residential mortgage-backed securities
|
$ | 7 | $ | - | $ | - | $ | 7 | ||||||||
Municipal debt securities
|
- | - | - | - | ||||||||||||
Trust preferred debt security
|
3,000 | - | - | 3,000 | ||||||||||||
Total securities held-to-maturity
|
$ | 3,007 | $ | - | $ | - | $ | 3,007 | ||||||||
December 31, 2011 | ||||||||||||||||
(Dollars in thousands)
|
Amortized
Cost |
Gross
UnrealizedGains |
Gross
Unrealized Losses |
Market
Value |
||||||||||||
Available-for-sale
|
||||||||||||||||
Debt securities:
|
||||||||||||||||
U.S. Treasury obligations
|
$ | 80,999 | $ | - | $ | - | $ | 80,999 | ||||||||
U.S. Government agency obligations
|
27,003 | 12 | (9 | ) | 27,006 | |||||||||||
Government sponsored residential mortgage-backed securities
|
19,254 | 1,302 | (11 | ) | 20,545 | |||||||||||
Corporate debt securities
|
1,000 | 175 | - | 1,175 | ||||||||||||
Trust preferred debt securities
|
42 | - | - | 42 | ||||||||||||
Preferred equity securities
|
2,100 | 112 | (639 | ) | 1,573 | |||||||||||
Marketable equity securities
|
348 | 22 | (4 | ) | 366 | |||||||||||
Mutual funds
|
3,439 | 25 | - | 3,464 | ||||||||||||
Total securities available-for-sale
|
$ | 134,185 | $ | 1,648 | $ | (663 | ) | $ | 135,170 | |||||||
Held-to-maturity
|
||||||||||||||||
Government sponsored residential mortgage-backed securities
|
$ | 7 | $ | - | $ | - | $ | 7 | ||||||||
Municipal debt securities
|
209 | - | - | 209 | ||||||||||||
Trust preferred debt security
|
3,000 | - | - | 3,000 | ||||||||||||
Total securities held-to-maturity
|
$ | 3,216 | $ | - | $ | - | $ | 3,216 |
First Connecticut Bancorp, Inc.
|
Notes to Consolidated Financial Statements (Unaudited)
|
Less than 12 Months
|
12 Months or More
|
Total
|
||||||||||||||||||||||
(Dollars in thousands)
|
Fair
Value
|
Gross
Unrealized
Loss
|
Fair
Value
|
Gross
Unrealized
Loss
|
Fair
Value
|
Gross
Unrealized
Loss
|
||||||||||||||||||
June 30, 2012
|
||||||||||||||||||||||||
Available-for-sale:
|
||||||||||||||||||||||||
U.S. Treasury obligations
|
$ | 34,990 | $ | (2 | ) | $ | - | $ | - | $ | 34,990 | $ | (2 | ) | ||||||||||
Government sponsored residential mortgage-backed securities
|
- | - | 56 | (2 | ) | 56 | (2 | ) | ||||||||||||||||
Preferred equity securities
|
98 | (3 | ) | 1,474 | (526 | ) | 1,572 | (529 | ) | |||||||||||||||
Marketable equity securities
|
- | - | 3 | (4 | ) | 3 | (4 | ) | ||||||||||||||||
$ | 35,088 | $ | (5 | ) | $ | 1,533 | $ | (532 | ) | $ | 36,621 | $ | (537 | ) |
Less than 12 Months
|
12 Months or More
|
Total
|
||||||||||||||||||||||
(Dollars in thousands)
|
Fair
Value
|
Gross
Unrealized
Loss
|
Fair
Value
|
Gross
Unrealized
Loss
|
Fair
Value
|
Gross
Unrealized
Loss
|
||||||||||||||||||
December 31, 2011
|
||||||||||||||||||||||||
Available-for-sale:
|
||||||||||||||||||||||||
U.S. Government agency obligations
|
$ | 16,994 | $ | (9 | ) | $ | - | $ | - | $ | 16,994 | $ | (9 | ) | ||||||||||
Government sponsored residential mortgage-backed securities
|
776 | (9 | ) | 124 | (2 | ) | 900 | (11 | ) | |||||||||||||||
Preferred equity securities
|
87 | (13 | ) | 1,374 | (626 | ) | 1,461 | (639 | ) | |||||||||||||||
Marketable equity securities
|
- | - | 3 | (4 | ) | 3 | (4 | ) | ||||||||||||||||
$ | 17,857 | $ | (31 | ) | $ | 1,501 | $ | (632 | ) | $ | 19,358 | $ | (663 | ) |
First Connecticut Bancorp, Inc.
|
Notes to Consolidated Financial Statements (Unaudited)
|
June 30, 2012
|
|||||||||||||||||||
Available-for-Sale
|
Held-to-Maturity
|
||||||||||||||||||
Amortized
Cost
|
Estimated
Market
Value
|
Amortized
Cost
|
Estimated
Market
Value
|
||||||||||||||||
(Dollars in thousands)
|
|||||||||||||||||||
Due in one year or less
|
$ | 93,985 | $ | 93,985 | $ | - | $ | - | |||||||||||
Due after one year through five years
|
14,446 | 14,573 | - | - | |||||||||||||||
Due after five years through ten years
|
500 | 588 | - | - | |||||||||||||||
Due after ten years
|
37 | 37 | 3,000 | 3,000 | |||||||||||||||
Government sponsored residential mortgage-backed securities
|
14,536 | 15,639 | 7 | 7 | |||||||||||||||
$ | 123,504 | $ | 124,822 | $ | 3,007 | $ | 3,007 |
First Connecticut Bancorp, Inc.
|
Notes to Consolidated Financial Statements (Unaudited)
|
June 30, 2012
|
December 31,
2011
|
|||||||
(Dollars in thousands)
|
||||||||
Real estate
|
||||||||
Residential
|
$ | 576,228 | $ | 503,361 | ||||
Commercial
|
423,939 | 408,169 | ||||||
Construction
|
48,084 | 46,381 | ||||||
Installment
|
8,121 | 10,333 | ||||||
Commercial
|
180,653 | 154,300 | ||||||
Collateral
|
2,165 | 2,348 | ||||||
Home equity line of credit
|
126,377 | 109,771 | ||||||
Demand
|
25 | 41 | ||||||
Revolving credit
|
89 | 90 | ||||||
Resort
|
64,755 | 75,363 | ||||||
Total loans
|
1,430,436 | 1,310,157 | ||||||
Less:
|
||||||||
Allowance for loan losses
|
(17,927 | ) | (17,533 | ) | ||||
Net deferred loan costs
|
3,223 | 2,553 | ||||||
Loans, net
|
$ | 1,415,732 | $ | 1,295,177 |
First Connecticut Bancorp, Inc.
|
Notes to Consolidated Financial Statements (Unaudited)
|
For the Three Months Ended June 30,
|
For the Six Months Ended June 30, | |||||||||||||||
(Dollars in thousands)
|
2012
|
2011
|
2012
|
2011
|
||||||||||||
Balance at beginning of period
|
$ | 17,727 | $ | 20,562 | $ | 17,533 | $ | 20,734 | ||||||||
Provision for loan losses
|
520 | 300 | 850 | 600 | ||||||||||||
Charge-offs
|
(492 | ) | (4,963 | ) | (640 | ) | (5,439 | ) | ||||||||
Recoveries
|
172 | 13 | 184 | 17 | ||||||||||||
Balance at end of period
|
$ | 17,927 | $ | 15,912 | $ | 17,927 | $ | 15,912 |
For the Three Months Ended June 30, 2012
|
||||||||||||||||||||
Balance at
beginning of
period
|
Charge-offs
|
Recoveries
|
Provision for
(Reduction)
loan losses
|
Balance at
end of period
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Real estate
|
||||||||||||||||||||
Residential
|
$ | 3,192 | $ | (70 | ) | $ | 5 | $ | 644 | $ | 3,771 | |||||||||
Commercial
|
8,529 | (405 | ) | 3 | (436 | ) | 7,691 | |||||||||||||
Construction
|
582 | - | - | 50 | 632 | |||||||||||||||
Installment
|
76 | - | - | (10 | ) | 66 | ||||||||||||||
Commercial
|
2,253 | - | 161 | 506 | 2,920 | |||||||||||||||
Collateral
|
- | - | - | - | - | |||||||||||||||
Home equity line of credit
|
1,315 | - | - | 85 | 1,400 | |||||||||||||||
Demand
|
- | - | - | - | - | |||||||||||||||
Revolving credit
|
- | (17 | ) | 3 | 14 | - | ||||||||||||||
Resort
|
1,650 | - | - | (203 | ) | 1,447 | ||||||||||||||
Unallocated
|
130 | - | - | (130 | ) | - | ||||||||||||||
$ | 17,727 | $ | (492 | ) | $ | 172 | $ | 520 | $ | 17,927 |
First Connecticut Bancorp, Inc.
|
Notes to Consolidated Financial Statements (Unaudited)
|
For the Six Months Ended June 30, 2012
|
||||||||||||||||||||
Balance at
beginning of
period
|
Charge-offs
|
Recoveries
|
Provision for
(Reduction)
loan losses
|
Balance at
end of period
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Real estate
|
||||||||||||||||||||
Residential
|
$ | 2,874 | $ | (131 | ) | $ | 5 | $ | 1,023 | $ | 3,771 | |||||||||
Commercial
|
8,755 | (454 | ) | 3 | (613 | ) | 7,691 | |||||||||||||
Construction
|
590 | - | - | 42 | 632 | |||||||||||||||
Installment
|
92 | (6 | ) | 3 | (23 | ) | 66 | |||||||||||||
Commercial
|
2,140 | - | 165 | 615 | 2,920 | |||||||||||||||
Collateral
|
- | - | - | - | - | |||||||||||||||
Home equity line of credit
|
1,295 | (19 | ) | - | 124 | 1,400 | ||||||||||||||
Demand
|
- | - | - | - | - | |||||||||||||||
Revolving credit
|
- | (30 | ) | 8 | 22 | - | ||||||||||||||
Resort
|
1,787 | - | - | (340 | ) | 1,447 | ||||||||||||||
$ | 17,533 | $ | (640 | ) | $ | 184 | $ | 850 | $ | 17,927 |
First Connecticut Bancorp, Inc.
|
Notes to Consolidated Financial Statements (Unaudited)
|
June 30, 2012
|
December 31, 2011
|
|||||||||||||||
(Dollars in thousands)
|
Total
|
Reserve
Allocation
|
Total
|
Reserve
Allocation
|
||||||||||||
Real estate
|
||||||||||||||||
Residential
|
$ | 11,148 | $ | 840 | $ | 10,632 | $ | 459 | ||||||||
Commercial
|
17,971 | 191 | 17,660 | 1,245 | ||||||||||||
Construction
|
726 | - | 994 | 34 | ||||||||||||
Installment
|
7 | - | - | - | ||||||||||||
Commercial
|
6,304 | 343 | 8,099 | 17 | ||||||||||||
Collateral
|
- | - | - | - | ||||||||||||
Home equity line of credit
|
1,494 | 455 | 1,555 | 455 | ||||||||||||
Demand
|
- | - | - | - | ||||||||||||
Revolving Credit
|
- | - | - | - | ||||||||||||
Resort
|
1,871 | 1 | 2,054 | 1 | ||||||||||||
Total
|
$ | 39,521 | $ | 1,830 | $ | 40,994 | $ | 2,211 |
June 30, 2012
|
December 31, 2011
|
|||||||||||||||
(Dollars in thousands)
|
Total
|
Reserve
Allocation
|
Total
|
Reserve
Allocation
|
||||||||||||
Real estate
|
||||||||||||||||
Residential
|
$ | 567,882 | $ | 2,931 | $ | 494,949 | $ | 2,415 | ||||||||
Commercial
|
405,943 | 7,500 | 390,466 | 7,510 | ||||||||||||
Construction
|
47,313 | 632 | 45,346 | 556 | ||||||||||||
Installment
|
8,114 | 66 | 10,333 | 92 | ||||||||||||
Commercial
|
174,941 | 2,577 | 146,755 | 2,123 | ||||||||||||
Collateral
|
2,165 | - | 2,348 | - | ||||||||||||
Home equity line of credit
|
124,888 | 945 | 108,219 | 840 | ||||||||||||
Demand
|
25 | - | 41 | - | ||||||||||||
Revolving Credit
|
89 | - | 90 | - | ||||||||||||
Resort
|
62,778 | 1,446 | 73,169 | 1,786 | ||||||||||||
Total
|
$ | 1,394,138 | $ | 16,097 | $ | 1,271,716 | $ | 15,322 | ||||||||
Unallocated
|
- | - | - | - | ||||||||||||
Total
|
$ | 1,433,659 | $ | 17,927 | $ | 1,312,710 | $ | 17,533 |
First Connecticut Bancorp, Inc.
|
Notes to Consolidated Financial Statements (Unaudited)
|
June 30, 2012
|
||||||||||||||||||||||||||||||||||||
Past Due 90
Days or More
and Still
Accruing |
||||||||||||||||||||||||||||||||||||
(Dollars in thousands)
|
30-59 Days
Past Due
|
60-89 Days
Past Due
|
> 90 Days
Past Due
|
Total
|
||||||||||||||||||||||||||||||||
Number
|
Amount
|
Number
|
Amount
|
Number
|
Amount
|
Number
|
Amount
|
|||||||||||||||||||||||||||||
Real estate
|
||||||||||||||||||||||||||||||||||||
Residential
|
10 | $ | 1,840 | 1 | $ | 203 | 22 | $ | 8,658 | 33 | $ | 10,701 | $ | - | ||||||||||||||||||||||
Commercial
|
- | - | - | - | 4 | 1,275 | 4 | 1,275 | - | |||||||||||||||||||||||||||
Construction
|
- | - | - | - | 1 | 484 | 1 | 484 | - | |||||||||||||||||||||||||||
Installment
|
2 | 10 | 3 | 35 | 2 | 54 | 7 | 99 | - | |||||||||||||||||||||||||||
Commercial
|
2 | 190 | - | - | 4 | 740 | 6 | 930 | - | |||||||||||||||||||||||||||
Collateral
|
5 | 82 | - | - | - | - | 5 | 82 | - | |||||||||||||||||||||||||||
Home equity line of credit
|
1 | 98 | 1 | 70 | 5 | 1,526 | 7 | 1,694 | - | |||||||||||||||||||||||||||
Demand
|
- | - | - | - | 1 | 25 | 1 | 25 | - | |||||||||||||||||||||||||||
Revolving Credit
|
- | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
Resort
|
- | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
Total
|
20 | $ | 2,220 | 5 | $ | 308 | 39 | $ | 12,762 | 64 | $ | 15,290 | $ | - |
December 31, 2011
|
||||||||||||||||||||||||||||||||||||
Past Due 90
Days or More and Still Accruing |
||||||||||||||||||||||||||||||||||||
(Dollars in thousands)
|
30-59 Days
Past Due
|
60-89 Days
Past Due
|
> 90 Days
Past Due
|
Total
|
||||||||||||||||||||||||||||||||
Number
|
Amount
|
Number
|
Amount
|
Number
|
Amount
|
Number
|
Amount
|
|||||||||||||||||||||||||||||
Real estate
|
||||||||||||||||||||||||||||||||||||
Residential
|
12 | $ | 2,955 | 4 | $ | 730 | 17 | $ | 7,926 | 33 | $ | 11,611 | $ | - | ||||||||||||||||||||||
Commercial
|
1 | 963 | - | - | 9 | 2,934 | 10 | 3,897 | - | |||||||||||||||||||||||||||
Construction
|
- | - | - | - | 2 | 484 | 2 | 484 | - | |||||||||||||||||||||||||||
Installment
|
5 | 22 | 1 | 78 | 2 | 63 | 8 | 163 | - | |||||||||||||||||||||||||||
Commercial
|
- | - | - | - | 8 | 802 | 8 | 802 | - | |||||||||||||||||||||||||||
Collateral
|
9 | 70 | - | - | - | - | 9 | 70 | - | |||||||||||||||||||||||||||
Home equity line of credit
|
3 | 204 | - | - | 6 | 1,555 | 9 | 1,759 | - | |||||||||||||||||||||||||||
Demand
|
1 | 16 | - | - | 1 | 25 | 2 | 41 | - | |||||||||||||||||||||||||||
Revolving Credit
|
- | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
Resort
|
- | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
Total
|
31 | $ | 4,230 | 5 | $ | 808 | 45 | $ | 13,789 | 81 | $ | 18,827 | $ | - |
First Connecticut Bancorp, Inc.
|
Notes to Consolidated Financial Statements (Unaudited)
|
(Dollars in thousands)
|
June 30, 2012
|
December 31,
2011 |
||||||
Nonaccrual loans:
|
||||||||
Real estate
|
||||||||
Residential
|
$ | 8,658 | $ | 9,224 | ||||
Commercial
|
1,275 | 2,934 | ||||||
Construction
|
484 | 484 | ||||||
Installment
|
145 | 209 | ||||||
Commercial
|
1,244 | 956 | ||||||
Collateral
|
- | - | ||||||
Home equity line of credit
|
1,647 | 1,669 | ||||||
Demand
|
25 | 25 | ||||||
Revolving Credit
|
- | - | ||||||
Resort
|
- | - | ||||||
Total nonaccruing loans
|
13,478 | 15,501 | ||||||
Loans 90 days past due and still accruing
|
- | - | ||||||
Real estate owned
|
376 | 302 | ||||||
Total nonperforming assets
|
$ | 13,854 | $ | 15,803 |
First Connecticut Bancorp, Inc.
|
Notes to Consolidated Financial Statements (Unaudited)
|
June 30, 2012
|
||||||||||||||||||||||||
(Dollars in thousands)
|
Recorded
Investment
|
Unpaid
Principal
Balance
|
Related
Allowance
|
Average
Recorded
Investment
|
Interest
Income
Recognized
|
Cash-basis
Interest
Income
Recognized
|
||||||||||||||||||
Impaired loans without a valuation allowance:
|
||||||||||||||||||||||||
Real estate
|
||||||||||||||||||||||||
Residential
|
$ | 3,709 | $ | 3,842 | $ | - | $ | 4,631 | $ | 8 | $ | 8 | ||||||||||||
Commercial
|
8,110 | 8,427 | - | 9,281 | 216 | 206 | ||||||||||||||||||
Construction
|
726 | 971 | - | 530 | 8 | 8 | ||||||||||||||||||
Installment
|
7 | 7 | - | 4 | - | - | ||||||||||||||||||
Commercial
|
4,060 | 4,060 | - | 5,941 | 115 | 112 | ||||||||||||||||||
Collateral
|
- | - | - | - | - | - | ||||||||||||||||||
Home equity line of credit
|
495 | 569 | - | 469 | - | - | ||||||||||||||||||
Demand
|
- | - | - | - | - | - | ||||||||||||||||||
Revolving Credit
|
- | - | - | - | - | - | ||||||||||||||||||
Resort
|
104 | 104 | - | 90 | 2 | 2 | ||||||||||||||||||
Total
|
17,211 | 17,980 | - | 20,946 | 349 | 336 | ||||||||||||||||||
Impaired loans with a valuation allowance:
|
||||||||||||||||||||||||
Real estate
|
||||||||||||||||||||||||
Residential
|
7,439 | 8,045 | 840 | 6,348 | 46 | 37 | ||||||||||||||||||
Commercial
|
9,861 | 9,860 | 191 | 8,908 | 324 | 322 | ||||||||||||||||||
Construction
|
- | - | - | 262 | - | - | ||||||||||||||||||
Installment
|
- | - | - | - | - | - | ||||||||||||||||||
Commercial
|
2,244 | 2,257 | 343 | 1,188 | 32 | 30 | ||||||||||||||||||
Collateral
|
- | - | - | - | - | - | ||||||||||||||||||
Home equity line of credit
|
999 | 999 | 455 | 999 | - | - | ||||||||||||||||||
Demand
|
- | - | - | - | - | - | ||||||||||||||||||
Revolving Credit
|
- | - | - | - | - | - | ||||||||||||||||||
Resort
|
1,767 | 1,765 | 1 | 1,385 | 30 | 30 | ||||||||||||||||||
Total
|
22,310 | 22,926 | 1,830 | 19,090 | 432 | 419 | ||||||||||||||||||
Total impaired loans
|
$ | 39,521 | $ | 40,906 | $ | 1,830 | $ | 40,036 | $ | 781 | $ | 755 |
First Connecticut Bancorp, Inc.
|
Notes to Consolidated Financial Statements (Unaudited)
|
December 31, 2011
|
||||||||||||||||||||||||
(Dollars in thousands)
|
Recorded
Investment
|
Unpaid
Principal
Balance
|
Related
Allowance
|
Average
Recorded
Investment
|
Interest
Income
Recognized
|
Cash-basis
Interest
Income
Recognized
|
||||||||||||||||||
Impaired loans without a valuation allowance:
|
||||||||||||||||||||||||
Real estate
|
||||||||||||||||||||||||
Residential
|
$ | 4,397 | $ | 4,733 | $ | - | $ | 5,042 | $ | 425 | $ | 425 | ||||||||||||
Commercial
|
9,362 | 9,542 | - | 8,925 | 363 | 363 | ||||||||||||||||||
Construction
|
510 | 510 | - | 128 | 7 | 7 | ||||||||||||||||||
Installment
|
- | - | - | - | - | - | ||||||||||||||||||
Commercial
|
7,366 | 7,356 | - | 4,806 | 230 | 228 | ||||||||||||||||||
Collateral
|
- | - | - | - | - | - | ||||||||||||||||||
Home equity line of credit
|
556 | 627 | - | 844 | 7 | 7 | ||||||||||||||||||
Demand
|
- | - | - | - | - | - | ||||||||||||||||||
Revolving Credit
|
- | - | - | - | - | - | ||||||||||||||||||
Resort
|
136 | 134 | - | 34 | - | - | ||||||||||||||||||
Total
|
22,327 | 22,902 | - | 19,779 | 1,032 | 1,030 | ||||||||||||||||||
Impaired loans with a valuation allowance:
|
||||||||||||||||||||||||
Real estate
|
||||||||||||||||||||||||
Residential
|
6,235 | 6,504 | 459 | 5,876 | 61 | 61 | ||||||||||||||||||
Commercial
|
8,298 | 9,390 | 1,245 | 7,613 | 611 | 611 | ||||||||||||||||||
Construction
|
484 | 730 | 34 | 574 | - | - | ||||||||||||||||||
Installment
|
- | - | - | - | - | - | ||||||||||||||||||
Commercial
|
733 | 746 | 17 | 398 | 22 | 22 | ||||||||||||||||||
Collateral
|
- | - | - | - | - | - | ||||||||||||||||||
Home equity line of credit
|
999 | 999 | 455 | 814 | 2 | 2 | ||||||||||||||||||
Demand
|
- | - | - | - | - | - | ||||||||||||||||||
Revolving Credit
|
- | - | - | - | - | - | ||||||||||||||||||
Resort
|
1,918 | 1,916 | 1 | 1,700 | 16 | 16 | ||||||||||||||||||
Total
|
18,667 | 20,285 | 2,211 | 16,975 | 712 | 712 | ||||||||||||||||||
Total impaired loans
|
$ | 40,994 | $ | 43,187 | $ | 2,211 | $ | 36,754 | $ | 1,744 | $ | 1,742 |
June 30, 2012 | |||||||||||||||||||||||||||
TDRs on Accrual Status
|
TDRs on Nonaccrual Status
|
Total TDRs
|
|||||||||||||||||||||||||
(Dollars in thousands)
|
Number of
Loans |
Recorded
Investment |
Number of
Loans |
Recorded
Investment |
Number of
Loans |
Recorded
Investment |
|||||||||||||||||||||
Real estate
|
|||||||||||||||||||||||||||
Residential
|
4 | $ | 2,186 | 5 | $ | 4,221 | 9 | $ | 6,407 | ||||||||||||||||||
Commercial
|
12 | 16,692 | - | - | 12 | 16,692 | |||||||||||||||||||||
Construction
|
1 | 241 | 1 | 484 | 2 | 725 | |||||||||||||||||||||
Installment
|
1 | 7 | - | - | 1 | 7 | |||||||||||||||||||||
Commercial
|
8 | 3,906 | 5 | 468 | 13 | 4,374 | |||||||||||||||||||||
Collateral
|
- | - | - | - | - | - | |||||||||||||||||||||
Home equity line of credit
|
- | - | 1 | 999 | 1 | 999 | |||||||||||||||||||||
Demand
|
- | - | - | - | - | - | |||||||||||||||||||||
Revolving Credit
|
- | - | - | - | - | - | |||||||||||||||||||||
Resort
|
2 | 1,871 | - | - | 2 | 1,871 | |||||||||||||||||||||
Total
|
28 | $ | 24,903 | 12 | $ | 6,172 | 40 | $ | 31,075 |
December 31, 2011 | |||||||||||||||||||||||||||
TDRs on Accrual Status
|
TDRs on Nonaccrual Status
|
Total TDRs
|
|||||||||||||||||||||||||
(Dollars in thousands)
|
Number of
Loans |
Recorded
Investment |
Number of
Loans |
Recorded
Investment |
Number of
Loans |
Recorded
Investment |
|||||||||||||||||||||
Real estate
|
|||||||||||||||||||||||||||
Residential
|
3 | $ | 1,075 | 5 | $ | 5,072 | 8 | $ | 6,147 | ||||||||||||||||||
Commercial
|
10 | 13,760 | 2 | 1,254 | 12 | 15,014 | |||||||||||||||||||||
Construction
|
1 | 510 | 1 | 484 | 2 | 994 | |||||||||||||||||||||
Installment
|
- | - | - | - | - | - | |||||||||||||||||||||
Commercial
|
10 | 6,116 | - | - | 10 | 6,116 | |||||||||||||||||||||
Collateral
|
- | - | - | - | - | - | |||||||||||||||||||||
Home equity line of credit
|
- | - | 1 | 999 | 1 | 999 | |||||||||||||||||||||
Demand
|
- | - | - | - | - | - | |||||||||||||||||||||
Revolving Credit
|
- | - | - | - | - | - | |||||||||||||||||||||
Resort
|
2 | 2,054 | - | - | 2 | 2,054 | |||||||||||||||||||||
Total
|
26 | $ | 23,515 | 9 | $ | 7,809 | 35 | $ | 31,324 |
For the Three Months Ended June 30, 2012
|
For the Six Months Ended June 30, 2012
|
|||||||||||||||||||||||||||
(Dollars in thousands)
|
Number of
Modifications |
Recorded
Investment Prior to Modification |
Recorded
Investment |
Number of
Modifications |
Recorded
Investment |
Recorded
InvestmentAfter Modification (1) |
||||||||||||||||||||||
Trouble Debt Restructurings:
|
||||||||||||||||||||||||||||
Real estate
|
||||||||||||||||||||||||||||
Residential
|
1 | $ | 462 | $ | 462 | 2 | $ | 579 | $ | 577 | ||||||||||||||||||
Commercial
|
5 | 8,305 | 8,305 | 5 | 8,305 | 8,305 | ||||||||||||||||||||||
Construction
|
- | - | - | 1 | 242 | 241 | ||||||||||||||||||||||
Installment
|
- | - | - | 1 | 7 | 7 | ||||||||||||||||||||||
Commercial
|
4 | 169 | 169 | 6 | 2,372 | 2,084 | ||||||||||||||||||||||
Total
|
10 | $ | 8,936 | $ | 8,936 | 15 | $ | 11,505 | $ | 11,214 |
(1)
|
The period end balances are inclusive of all partial paydowns and charge-offs since the modification date. TDRs fully paid off, charged-off or foreclosed upon by period end are not included.
|
For The Three Months Ended June 30, 2012 | ||||||||||||||||||||||||
(Dollars in thousands)
|
Number of
Modifications |
Extended
Maturity |
Adjusted
Interest |
Combination
of Rate and |
Other
|
Total
|
||||||||||||||||||
Real estate
|
||||||||||||||||||||||||
Residential
|
1 | $ | - | $ | - | $ | - | $ | 462 | $ | 462 | |||||||||||||
Commercial
|
5 | 1,754 | 3,301 | - | 3,250 | 8,305 | ||||||||||||||||||
Commercial
|
4 | - | - | 169 | - | 169 | ||||||||||||||||||
Total
|
10 | $ | 1,754 | $ | 3,301 | $ | 169 | $ | 3,712 | $ | 8,936 |
For the Six Months Ended June 30, 2012 | ||||||||||||||||||||||||
(Dollars in thousands)
|
Number of
Modifications
|
Extended
Maturity |
Adjusted
Interest |
Combination
of Rate and |
Other
|
Total
|
||||||||||||||||||
Real estate
|
||||||||||||||||||||||||
Residential
|
2 | $ | - | $ | 115 | $ | - | $ | 462 | $ | 577 | |||||||||||||
Commercial
|
5 | 1,754 | 3,301 | - | 3,250 | 8,305 | ||||||||||||||||||
Construction
|
1 | 241 | - | - | - | 241 | ||||||||||||||||||
Installment
|
1 | - | 7 | - | - | 7 | ||||||||||||||||||
Commercial
|
6 | 1,915 | - | 169 | - | 2,084 | ||||||||||||||||||
Total
|
15 | $ | 3,910 | $ | 3,423 | $ | 169 | $ | 3,712 | $ | 11,214 |
Loans rated 1 – 5:
|
Commercial loans in these categories are considered “pass” rated loans with low to average risk.
|
Loans rated 6:
|
Residential, Consumer and Commercial loans in this category are considered “special mention.” These loans are starting to show signs of potential weakness and are being closely monitored by management.
|
Loans rated 7:
|
Loans in this category are considered “substandard.” Generally, a loan is considered substandard if it is inadequately protected by the current net worth and paying capacity of the obligors and/or the collateral pledged. There is a distinct possibility that the Company will sustain some loss if the weakness is not corrected.
|
Loans rated 8:
|
Loans in this category are considered “doubtful.” Loans classified as doubtful have all the weaknesses inherent in those classified substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, highly questionable and improbable.
|
Loans rated 9:
|
Loans in this category are considered uncollectible (“loss”) and of such little value that their continuance as loans is not warranted.
|
June 30, 2012 | ||||||||||||||||||||
(Dollars in thousands)
|
Pass
|
Special Mention
|
Substandard
|
Doubtful
|
Total
|
|||||||||||||||
Real estate
|
||||||||||||||||||||
Residential
|
$ | 562,814 | $ | 2,557 | $ | 10,857 | $ | - | $ | 576,228 | ||||||||||
Commercial
|
381,136 | 24,060 | 18,743 | - | 423,939 | |||||||||||||||
Construction
|
44,488 | 752 | 2,844 | - | 48,084 | |||||||||||||||
Installment
|
7,880 | 58 | 183 | - | 8,121 | |||||||||||||||
Commercial
|
158,091 | 8,796 | 13,468 | 298 | 180,653 | |||||||||||||||
Collateral
|
2,165 | - | - | - | 2,165 | |||||||||||||||
Home equity line of credit
|
123,756 | 655 | 1,966 | - | 126,377 | |||||||||||||||
Demand
|
- | - | 25 | - | 25 | |||||||||||||||
Revolving Credit
|
89 | - | - | - | 89 | |||||||||||||||
Resort
|
48,281 | 14,605 | 1,869 | - | 64,755 | |||||||||||||||
Total Loans
|
$ | 1,328,700 | $ | 51,483 | $ | 49,955 | $ | 298 | $ | 1,430,436 |
December 31, 2011 | ||||||||||||||||||||
(Dollars in thousands)
|
Pass | Special Mention | Substandard | Doubtful | Total | |||||||||||||||
Real estate
|
||||||||||||||||||||
Residential
|
$ | 490,805 | $ | 2,079 | $ | 10,477 | $ | - | $ | 503,361 | ||||||||||
Commercial
|
370,688 | 14,480 | 23,001 | - | 408,169 | |||||||||||||||
Construction
|
42,492 | 200 | 3,689 | - | 46,381 | |||||||||||||||
Installment
|
10,051 | 66 | 216 | - | 10,333 | |||||||||||||||
Commercial
|
135,953 | 3,020 | 15,327 | - | 154,300 | |||||||||||||||
Collateral
|
2,348 | - | - | - | 2,348 | |||||||||||||||
Home equity line of credit
|
107,421 | 432 | 1,918 | - | 109,771 | |||||||||||||||
Demand
|
16 | - | 25 | - | 41 | |||||||||||||||
Revolving Credit
|
90 | - | - | - | 90 | |||||||||||||||
Resort
|
57,093 | 5,885 | 12,385 | - | 75,363 | |||||||||||||||
Total Loans
|
$ | 1,216,957 | $ | 26,162 | $ | 67,038 | $ | - | $ | 1,310,157 |
5.
|
Credit Arrangements
|
6.
|
Deposits
|
June 30, 2012
|
December
31, 2011 |
||||||||
Amount
|
Amount
|
||||||||
(Dollars in thousands)
|
|||||||||
Noninterest-bearing demand deposits
|
$ | 223,820 | $ | 195,625 | |||||
Interest-bearing
|
|||||||||
NOW accounts
|
181,464 | 189,577 | |||||||
Money market
|
272,287 | 247,693 | |||||||
Savings accounts
|
178,378 | 157,913 | |||||||
Time deposits
|
362,794 | 385,874 | |||||||
Total deposits
|
$ | 1,218,743 | $ | 1,176,682 |
7.
|
Pension and Other Postretirement Benefit Plans
|
Pension Benefits
|
Other Postretirement Benefits
|
|||||||||||||||
Three Months Ended June 30,
|
Three Months Ended June 30,
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Service cost
|
$ | 125 | $ | 172 | $ | 15 | $ | 15 | ||||||||
Interest cost
|
272 | 264 | 34 | 34 | ||||||||||||
Expected return on plan assets
|
(265 | ) | (269 | ) | - | - | ||||||||||
Amortization:
|
||||||||||||||||
Loss
|
169 | 98 | - | - | ||||||||||||
Transition obligation
|
- | - | - | - | ||||||||||||
Prior service cost
|
(32 | ) | (31 | ) | (12 | ) | (12 | ) | ||||||||
Net periodic benefit cost
|
$ | 269 | $ | 234 | $ | 37 | $ | 37 |
Pension Benefits
|
Other Postretirement Benefits
|
|||||||||||||||
Six Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
|
2012
|
2011
|
2012
|
2011
|
||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Service cost
|
$ | 250 | $ | 344 | $ | 30 | $ | 30 | ||||||||
Interest cost
|
544 | 528 | 68 | 68 | ||||||||||||
Expected return on plan assets
|
(518 | ) | (538 | ) | - | - | ||||||||||
Amortization:
|
||||||||||||||||
Loss
|
338 | 196 | - | - | ||||||||||||
Transition obligation
|
- | - | - | - | ||||||||||||
Prior service cost
|
(63 | ) | (62 | ) | (24 | ) | (24 | ) | ||||||||
Net periodic benefit cost
|
$ | 551 | $ | 468 | $ | 74 | $ | 74 |
Allocated
|
95,361
|
||||
Committed to be released
|
47,420
|
||||
Unallocated
|
1,287,635
|
||||
1,430,416
|
8.
|
Derivative Financial Instruments
|
●
|
if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations;
|
●
|
if the Company fails to maintain its status as a well/adequately capitalized institution, then the counterparty could terminate the derivative positions, and the Company would be required to settle its obligations under the agreements;
|
●
|
if the Company fails to maintain a specified minimum leverage ratio, then the Company could be declared in default on its derivative obligations; and
|
●
|
if a specified event or condition occurs that materially changes the Company’s creditworthiness in an adverse manner, it may be required to fully collateralize its obligations under the derivative instrument.
|
June 30, 2012
|
December 31, 2011
|
||||||||||||||||||||||||
Consolidated
|
Estimated
|
Estimated
|
|||||||||||||||||||||||
Balance Sheet
|
# of
|
Notional
|
Fair
|
# of
|
Notional
|
Fair
|
|||||||||||||||||||
Location
|
Instruments
|
Amount
|
Values
|
Instruments
|
Amount
|
Values
|
|||||||||||||||||||
(Dollars in thousands)
|
|||||||||||||||||||||||||
Commercial loan customer
interest rate swap position |
Other Assets
|
33 | $ | 101,539 | $ | 8,474 | 28 | $ | 83,897 | $ | 6,812 | ||||||||||||||
Counterparty interest
rate swap position |
Other Liabilities
|
33 | 101,539 | (8,474 | ) | 28 | 83,897 | (6,812 | ) |
For The Three Months Ended June 30,
|
||||||||||||||||||||||||
2012
|
2011
|
|||||||||||||||||||||||
MTM (Loss)
|
MTM (Loss)
|
|||||||||||||||||||||||
Interest Income
|
Gain Recorded
|
Interest Income
|
Gain Recorded
|
|||||||||||||||||||||
Recorded in
|
in Noninterest
|
Recorded in
|
in Noninterest
|
|||||||||||||||||||||
Interest Income
|
Income
|
Net Impact
|
Interest Income
|
Income
|
Net Impact
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
Commercial loan customer
interest rate swap position |
$ | 572 | $ | - | $ | 572 | $ | 505 | $ | - | $ | 505 | ||||||||||||
Counterparty interest
rate swap position |
(572 | ) | - | (572 | ) | (505 | ) | - | (505 | ) | ||||||||||||||
Total
|
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
For The Six Months Ended June 30,
|
||||||||||||||||||||||||
2012
|
2011
|
|||||||||||||||||||||||
MTM (Loss)
|
MTM (Loss)
|
|||||||||||||||||||||||
Interest Income
|
Gain Recorded
|
Interest Income
|
Gain Recorded
|
|||||||||||||||||||||
Recorded in
|
in Noninterest
|
Recorded in
|
in Noninterest
|
|||||||||||||||||||||
Interest Income
|
Income
|
Net Impact
|
Interest Income
|
Income
|
Net Impact
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
Commercial loan customer
interest rate swap position |
$ | 1,121 | $ | - | $ | 1,121 | $ | 1,076 | $ | - | $ | 1,076 | ||||||||||||
Counterparty interest
rate swap position |
(1,121 | ) | - | (1,121 | ) | (1,076 | ) | - | (1,076 | ) | ||||||||||||||
Total
|
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
9.
|
Financial Instruments with Off-Balance Sheet Risk
|
June 30, 2012
|
December 31,
2011 |
||||||||
(Dollars in thousands)
|
|||||||||
Approved loan commitments
|
$ | 41,892 | $ | 21,483 | |||||
Unadvanced portion of construction loans
|
34,999 | 23,268 | |||||||
Unadvanced portion of resort loans
|
8,109 | 4,950 | |||||||
Unused lines for home equity loans
|
130,250 | 106,430 | |||||||
Unused revolving lines of credit
|
380 | 365 | |||||||
Unused commercial letters of credit
|
9,251 | 9,925 | |||||||
Unused commercial lines of credit
|
114,322 | 100,585 | |||||||
$ | 339,203 | $ | 267,006 |
10.
|
Fair Value Measurements
|
|
●
|
Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
|
|
●
|
Level 2 - Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability;
|
|
●
|
Level 3 - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).
|
June 30, 2012 | ||||||||||||||||
(Dollars in thousands)
|
Total
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Significant
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||||||
Assets
|
||||||||||||||||
U.S. Treasury obligations
|
$ | 93,985 | $ | 93,985 | $ | - | $ | - | ||||||||
U.S. Government agency obligation
|
12,018 | - | 12,018 | - | ||||||||||||
Government sponsored residential mortgage-backed securities
|
15,639 | - | 15,639 | - | ||||||||||||
Corporate debt securities
|
3,143 | - | 3,143 | - | ||||||||||||
Trust preferred debt securities
|
37 | - | - | 37 | ||||||||||||
Preferred equity securities
|
1,652 | - | 1,652 | - | ||||||||||||
Marketable equity securities
|
377 | 137 | 240 | - | ||||||||||||
Mutual funds
|
3,535 | - | 3,535 | - | ||||||||||||
Securities available-for-sale
|
130,386 | 94,122 | 36,227 | 37 | ||||||||||||
Interest rate swap derivative
|
8,474 | - | 8,474 | - | ||||||||||||
Derivative loan commitments
|
134 | - | - | 134 | ||||||||||||
Total
|
$ | 138,994 | $ | 94,122 | $ | 44,701 | $ | 171 | ||||||||
Liabilities
|
||||||||||||||||
Interest rate swap derivative
|
$ | 8,474 | $ | - | $ | 8,474 | $ | - | ||||||||
Forward loan sales commitments
|
10 | - | - | 10 | ||||||||||||
Total
|
$ | 8,484 | $ | - | $ | 8,474 | $ | 10 |
December 31, 2011
|
||||||||||||||||
(Dollars in thousands)
|
Total
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Significant
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||||||
Assets
|
||||||||||||||||
U.S. Treasury obligations
|
$ | 80,999 | $ | 80,999 | $ | - | $ | - | ||||||||
U.S. Government agency obligations
|
27,006 | - | 27,006 | - | ||||||||||||
Government sponsored residential mortgage-backed securities
|
20,545 | - | 20,545 | - | ||||||||||||
Corporate debt securities
|
1,175 | - | 1,175 | - | ||||||||||||
Trust preferred debt securities
|
42 | - | - | 42 | ||||||||||||
Preferred equity securities
|
1,573 | - | 1,573 | - | ||||||||||||
Marketable equity securities
|
366 | 126 | 240 | - | ||||||||||||
Mutual funds
|
3,464 | - | 3,464 | - | ||||||||||||
Securities available-for-sale
|
135,170 | 81,125 | 54,003 | 42 | ||||||||||||
Interest rate swap derivative
|
6,812 | - | 6,812 | - | ||||||||||||
Total
|
$ | 141,982 | $ | 81,125 | $ | 60,815 | $ | 42 | ||||||||
Liabilities
|
||||||||||||||||
Interest rate swap derivative
|
$ | 6,812 | $ | - | $ | 6,812 | $ | - | ||||||||
Forward loan sales commitments
|
5 | - | - | 5 | ||||||||||||
Derivative loan commitments
|
39 | - | - | 39 | ||||||||||||
Total
|
$ | 6,856 | $ | - | $ | 6,812 | $ | 44 |
Securities Available for Sale
|
Derivative and Forward Loan Sales Commitments, Net | |||||||||||||||
For the Three Months Ended June 30, |
For the Three Months Ended June 30, |
|||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
(Dollars in thousands) | ||||||||||||||||
Balance, at beginning of period
|
$ | 40 | $ | 44 | $ | (28 | ) | $ | 51 | |||||||
Paydowns
|
(3 | ) | - | - | - | |||||||||||
Total gains (losses) - (realized/unrealized):
|
||||||||||||||||
Included in earnings
|
- | - | 152 | (30 | ) | |||||||||||
Balance, at the end of period
|
$ | 37 | $ | 44 | $ | 124 | $ | 21 |
Securities Available for Sale
|
Derivative and Forward Loan
Sales Commitments, Net
|
|||||||||||||||
For the Six Months Ended
June 30,
|
For the Six Months Ended
June 30,
|
|||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
(Dollars in thousands) | ||||||||||||||||
Balance, at beginning of period
|
$ | 42 | $ | 44 | $ | (44 | ) | $ | - | |||||||
Paydowns
|
(5 | ) | - | - | - | |||||||||||
Total gains - (realized/unrealized):
|
||||||||||||||||
Included in earnings
|
- | - | 168 | 21 | ||||||||||||
Balance, at the end of period
|
$ | 37 | $ | 44 | $ | 124 | $ | 21 |
June 30, 2012
|
||||||||||||
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Significant
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
|||||||||
(Dollars in thousands)
|
||||||||||||
Mortgage servicing rights
|
$ | - | $ | - | $ | 607 | ||||||
Loans held for sale
|
- | 1,667 | - | |||||||||
Impaired loans
|
- | - | 37,691 | |||||||||
Other real estate owned
|
- | - | 376 | |||||||||
December 31, 2011
|
||||||||||||
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Significant
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
|||||||||
(Dollars in thousands)
|
||||||||||||
Mortgage servicing rights
|
$ | - | $ | - | $ | 594 | ||||||
Loans held for sale
|
- | 1,039 | - | |||||||||
Impaired loans
|
- | - | 38,783 | |||||||||
Other real estate owned
|
- | - | 302 |
(Dollars in thousands)
|
Fair Value
|
Valuation Methodology
|
Unobservable Inputs
|
Range of Inputs
|
|||||
Mortgage servicing rights
|
$
|
607
|
Discounted cash flows
|
Prepayment speed
|
6.5% - 8.7%
|
||||
Discount rate
|
23.0% - 30.7%
|
||||||||
Impaired loans
|
$
|
37,691
|
Appraisals
|
Discount for dated appraisal
|
0% - 20%
|
||||
Discount for costs to sell
|
8% - 15%
|
||||||||
Other real estate owned
|
$
|
376
|
Appraisals
|
Discount for costs to sell
|
8% - 10%
|
June 30, 2012 | December 31, 2011 | |||||||||||||||||
|
Fair Value
Hierarchy Level
|
Carrying
Amount
|
Estimated
Fair
Value
|
Carrying
Amount
|
Estimated
Fair
Value
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||||
Financial assets
|
||||||||||||||||||
Securities held-to-maturity
|
See previous table
|
$ | 3,007 | $ | 3,007 | $ | 3,216 | $ | 3,216 | |||||||||
Securities available-for-sale
|
See previous table
|
130,386 | 130,386 | 135,170 | 135,170 | |||||||||||||
Loans
|
Level 3
|
1,430,436 | 1,455,101 | 1,310,157 | 1,333,262 | |||||||||||||
Financial liabilities
|
||||||||||||||||||
Deposits | ||||||||||||||||||
Noninterest-bearing demand deposits |
Level 1
|
223,820 | 223,820 | 195,625 | 195,625 | |||||||||||||
NOW accounts |
Level 1
|
181,464 | 181,464 | 189,577 | 189,577 | |||||||||||||
Money market |
Level 1
|
272,287 | 272,287 | 247,693 | 247,693 | |||||||||||||
Savings accounts |
Level 1
|
178,378 | 178,378 | 157,913 | 157,913 | |||||||||||||
Time deposits
|
Level 2
|
362,794 | 366,435 | 385,874 | 389,857 | |||||||||||||
FHLB advances
|
Level 2
|
91,000 | 93,646 | 63,000 | 65,812 | |||||||||||||
Repurchase agreement borrowings
|
Level 2
|
21,000 | 22,836 | 21,000 | 22,963 | |||||||||||||
Repurchase liabilities
|
Level 2
|
67,534 | 67,537 | 64,466 | 64,466 | |||||||||||||
On-balance sheet derivative financial instruments:
|
||||||||||||||||||
Forward loan sales commitments:
|
||||||||||||||||||
Assets
|
Level 3
|
- | - | - | - | |||||||||||||
Liabilities
|
Level 3
|
10 | 10 | 5 | 5 | |||||||||||||
Interest rate swap derivative:
|
||||||||||||||||||
Assets
|
Level 2
|
8,474 | 8,474 | 6,812 | 6,812 | |||||||||||||
Liabilities
|
Level 2
|
8,474 | 8,474 | 6,812 | 6,812 | |||||||||||||
Derivative loan commitments:
|
||||||||||||||||||
Assets
|
Level 3
|
134 | 134 | - | - | |||||||||||||
Liabilities
|
Level 3
|
- | - | 39 | 39 |
11.
|
Regulatory Matters
|
Actual
|
Minimum Required
for Capital
Adequacy Purposes
|
To Be Well
Capitalized Under
Prompt Corrective
Action
|
||||||||||||||||||||||
(Dollars in thousands)
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||||||||
Farmington Bank:
|
||||||||||||||||||||||||
At June 30, 2012 -
|
||||||||||||||||||||||||
Total Capital (to Risk Weighted Assets)
|
$ | 200,023 | 15.18 | % | $ | 105,414 | 8.00 | % | $ | 131,767 | 10.00 | % | ||||||||||||
Tier I Capital (to Risk Weighted Assets)
|
183,533 | 13.93 | 52,702 | 4.00 | 79,052 | 6.00 | ||||||||||||||||||
Tier I Capital (to Average Assets)
|
183,533 | 11.04 | 66,497 | 4.00 | 83,122 | 5.00 | ||||||||||||||||||
At December 31, 2011 -
|
||||||||||||||||||||||||
Total Capital (to Risk Weighted Assets)
|
$ | 196,763 | 16.20 | % | $ | 97,167 | 8.00 | % | $ | 121,459 | 10.00 | % | ||||||||||||
Tier I Capital (to Risk Weighted Assets)
|
181,550 | 14.95 | 48,575 | 4.00 | 72,863 | 6.00 | ||||||||||||||||||
Tier I Capital (to Average Assets)
|
181,550 | 10.97 | 66,199 | 4.00 | 82,748 | 5.00 | ||||||||||||||||||
First Connecticut Bancorp, Inc.:
|
||||||||||||||||||||||||
At June 30, 2012 -
|
||||||||||||||||||||||||
Total Capital (to Risk Weighted Assets)
|
$ | 269,717 | 20.43 | % | $ | 105,616 | 8.00 | % | $ | 132,020 | 10.00 | % | ||||||||||||
Tier I Capital (to Risk Weighted Assets)
|
253,194 | 19.18 | 52,804 | 4.00 | 79,206 | 6.00 | ||||||||||||||||||
Tier I Capital (to Average Assets)
|
253,194 | 15.21 | 66,586 | 4.00 | 83,233 | 5.00 | ||||||||||||||||||
At December 31, 2011 -
|
||||||||||||||||||||||||
Total Capital (to Risk Weighted Assets)
|
$ | 272,365 | 22.38 | % | $ | 97,360 | 8.00 | % | $ | 121,700 | 10.00 | % | ||||||||||||
Tier I Capital (to Risk Weighted Assets)
|
257,152 | 21.13 | 48,680 | 4.00 | 73,020 | 6.00 | ||||||||||||||||||
Tier I Capital (to Average Assets)
|
257,152 | 15.51 | 66,319 | 4.00 | 82,899 | 5.00 |
12.
|
Legal Actions
|
●
|
statements of our goals, intentions and expectations;
|
●
|
statements regarding our business plans, prospects, growth and operating strategies;
|
●
|
statements regarding the asset quality of our loan and investment portfolios; and
|
●
|
estimates of our risks and future costs and benefits.
|
●
|
Local, regional and national business or economic conditions may differ from those expected.
|
●
|
The effects of and changes in trade, monetary and fiscal policies and laws, including the U.S. Federal Reserve Board’s interest rate policies, may adversely affect our business.
|
●
|
The ability to increase market share and control expenses may be more difficult than anticipated.
|
●
|
Changes in laws and regulatory requirements (including those concerning taxes, banking, securities and insurance) may adversely affect us or our business.
|
●
|
Changes in accounting policies and practices, as may be adopted by regulatory agencies, the Public Company Accounting Oversight Board or the Financial Accounting Standards Board, may affect expected financial reporting.
|
●
|
Future changes in interest rates may reduce our profits which could have a negative impact on the value of our stock.
|
●
|
We are subject to lending risk and could incur losses in our loan portfolio despite our underwriting practices. Changes in real estate values could also increase our lending risk.
|
●
|
Changes in demand for loan products, financial products and deposit flow could impact our financial performance.
|
●
|
Strong competition within our market area may limit our growth and profitability.
|
●
|
If our allowance for loan losses is not sufficient to cover actual loan losses, our earnings could decrease.
|
●
|
Our stock value may be negatively affected by federal regulations and articles of incorporation provisions restricting takeovers.
|
●
|
Implementation of stock benefit plans will increase our costs, which will reduce our income.
|
●
|
The Dodd-Frank Act was signed into law on July 21, 2010 and has resulted in dramatic regulatory changes that affects the industry in general, and may impact our competitive position in ways that cannot be predicted at this time.
|
●
|
The Emergency Economic Stabilization Act (“EESA”) of 2008 has and may continue to have a significant impact on the banking industry.
|
●
|
We may not manage the risks involved in the foregoing as well as anticipated.
|
●
|
|
maintaining a strong capital position in excess of the well-capitalized standards set by our banking regulators to support our current operations and future growth;
|
●
|
|
continuing our focus on commercial lending and continuing to expand commercial banking operations;
|
●
|
|
continuing to focus on consumer and residential lending;
|
●
|
|
maintaining asset quality and prudent lending standards;
|
●
|
|
expanding our existing products and services and developing new products and services to meet the changing needs of consumers and businesses in our market area;
|
●
|
|
continuing expansion through de novo branching with a current goal of adding two to three de novo branches each year for so long as the deposit and loan generating environment continues to be favorable;
|
●
|
|
increase consumer, small business and commercial deposit transaction account portfolio to grow customer base and have more non-interest bearing source of funds;
|
●
|
|
expand electronic banking delivery capability and usage to complement our de novo branch strategy and provide customer access 24/7;
|
●
|
|
taking advantage of acquisition opportunities that are consistent with our strategic growth plans; and
|
●
|
|
continuing our efforts to control non-interest expenses.
|
For the Three Months Ended June 30, | ||||||||||||||||
|
2012
|
2011
|
$ Change
|
% Change
|
||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Net interest income
|
$ | 12,799 | $ | 11,914 | $ | 885 | 7.4 | % | ||||||||
Provision for loan losses
|
520 | 300 | 220 | 73.3 | ||||||||||||
Noninterest income
|
2,006 | 1,429 | 577 | 40.4 | ||||||||||||
Noninterest expense
|
13,161 | 19,927 | (6,766 | ) | (34.0 | ) | ||||||||||
Income (loss) before taxes
|
1,124 | (6,884 | ) | 8,008 | (116.3 | ) | ||||||||||
Income tax provision
|
293 | (2,239 | ) | 2,532 | (113.1 | ) | ||||||||||
Net income (loss)
|
$ | 831 | $ | (4,645 | ) | $ | 5,476 | (117.9 | ) % |
Three Months Ended June 30, | ||||||||||||||||||||||||
2012 | 2011 | |||||||||||||||||||||||
Interest
|
Interest
|
|||||||||||||||||||||||
Average
|
and
|
Average
|
and
|
|||||||||||||||||||||
Balance
|
Dividends | Yield/Cost |
Balance
|
Dividends
|
Yield/Cost
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||
Loans receivable, net
|
$ | 1,360,401 | $ | 14,741 | 4.35 | % | $ | 1,186,674 | $ | 14,131 | 4.78 | % | ||||||||||||
Securities
|
131,309 | 370 | 1.13 | % | 143,277 | 485 | 1.36 | % | ||||||||||||||||
Federal Home Loan Bank of Boston stock
|
7,137 | 9 | 0.51 | % | 7,449 | - | 0.00 | % | ||||||||||||||||
Fed Funds and other earning assets
|
48,049 | 26 | 0.22 | % | 105,095 | 58 | 0.22 | % | ||||||||||||||||
Total interest-earning assets
|
1,546,896 | 15,146 | 3.93 | % | 1,442,495 | 14,674 | 4.08 | % | ||||||||||||||||
Noninterest-earning assets
|
117,486 | 76,585 | ||||||||||||||||||||||
Total assets
|
$ | 1,664,382 | $ | 1,519,080 | ||||||||||||||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||
NOW accounts
|
$ | 204,611 | $ | 83 | 0.16 | % | $ | 245,649 | $ | 178 | 0.29 | % | ||||||||||||
Money market
|
270,157 | 488 | 0.72 | % | 204,711 | 543 | 1.06 | % | ||||||||||||||||
Savings accounts
|
174,321 | 64 | 0.15 | % | 153,806 | 76 | 0.20 | % | ||||||||||||||||
Certificates of deposit
|
368,006 | 1,008 | 1.10 | % | 421,766 | 1,157 | 1.10 | % | ||||||||||||||||
Total interest-bearing deposits
|
1,017,095 | 1,643 | 0.65 | % | 1,025,932 | 1,954 | 0.76 | % | ||||||||||||||||
Advances from the Federal Home Loan Bank
|
62,869 | 462 | 2.95 | % | 68,005 | 531 | 3.13 | % | ||||||||||||||||
Repurchase Agreement Borrowing
|
21,000 | 181 | 3.46 | % | 21,000 | 179 | 3.42 | % | ||||||||||||||||
Repurchase liabilities
|
63,166 | 61 | 0.39 | % | 63,577 | 96 | 0.61 | % | ||||||||||||||||
Total interest-bearing liabilities
|
1,164,130 | 2,347 | 0.81 | % | 1,178,514 | 2,760 | 0.94 | % | ||||||||||||||||
Noninterest-bearing deposits
|
210,874 | 210,582 | ||||||||||||||||||||||
Other noninterest-bearing liabilities
|
38,273 | 28,213 | ||||||||||||||||||||||
Total liabilities
|
1,413,277 | 1,417,309 | ||||||||||||||||||||||
Capital
|
251,105 | 101,771 | ||||||||||||||||||||||
Total liabilities and capital
|
$ | 1,664,382 | $ | 1,519,080 | ||||||||||||||||||||
Net interest income
|
$ | 12,799 | $ | 11,914 | ||||||||||||||||||||
Net interest rate spread (1)
|
3.12 | % | 3.14 | % | ||||||||||||||||||||
Net interest-earning assets (2)
|
$ | 382,766 | $ | 263,981 | ||||||||||||||||||||
Net interest margin (3)
|
3.32 | % | 3.31 | % | ||||||||||||||||||||
Average interest-earning assets to average interest-bearing liabilities
|
132.88 | % | 122.40 | % |
(1)
|
Net interest rate spread represents the difference betw een 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.
|
Three Months Ended June 30, 2012 Compared to
|
||||||||||||
Three Months Ended June 30, 2011
|
||||||||||||
Total Increase
|
||||||||||||
(Dollars in thousands)
|
Volume
|
Rate
|
(Decrease)
|
|||||||||
Interest-earning assets:
|
||||||||||||
Loans receivable, net
|
$ | 1,582 | $ | (972 | ) | $ | 610 | |||||
Investment securities
|
(46 | ) | (69 | ) | (115 | ) | ||||||
Federal Home Loan Bank of Boston stock
|
- | 9 | 9 | |||||||||
Fed Funds and other interest-earning assets
|
(31 | ) | (1 | ) | (32 | ) | ||||||
Total interest-earning assets
|
1,505 | (1,033 | ) | 472 | ||||||||
Interest-bearing liabilities:
|
||||||||||||
NOW accounts
|
(27 | ) | (68 | ) | (95 | ) | ||||||
Money market
|
10,336 | (10,391 | ) | (55 | ) | |||||||
Savings accounts
|
8 | (20 | ) | (12 | ) | |||||||
Certificates of deposit
|
(149 | ) | - | (149 | ) | |||||||
Total interest-bearing deposits
|
10,168 | (10,479 | ) | (311 | ) | |||||||
Advances from the Federal Home Loan Bank
|
(43 | ) | (26 | ) | (69 | ) | ||||||
Repurchase agreement borrowing
|
- | 2 | 2 | |||||||||
Repurchase liabilities
|
(1 | ) | (34 | ) | (35 | ) | ||||||
Total interest-bearing liabilities
|
10,124 | (10,537 | ) | (413 | ) | |||||||
Increase (decrease) in net interest income
|
$ | (8,619 | ) | $ | 9,504 | $ | 885 |
Three Months Ended June 30, | ||||||||||||||||
2012
|
2011
|
$ Change
|
% Change
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Fees for customer services
|
$ | 900 | $ | 860 | $ | 40 | 4.7 | % | ||||||||
Net gain on loans sold
|
431 | 199 | 232 | 116.6 | ||||||||||||
Brokerage and insurance fee income
|
32 | 10 | 22 | 220.0 | ||||||||||||
Bank owned life insurance income
|
321 | 174 | 147 | 84.5 | ||||||||||||
Other
|
322 | 186 | 136 | 73.1 | ||||||||||||
Total noninterest income
|
$ | 2,006 | $ | 1,429 | $ | 577 | 40.4 | % |
Three Months Ended June 30, | ||||||||||||||||
2012
|
2011
|
$ Change
|
% Change
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Salaries and employee benefits
|
$ | 7,619 | $ | 7,473 | $ | 146 | 2.0 | % | ||||||||
Occupancy expense
|
1,098 | 1,094 | 4 | 0.4 | ||||||||||||
Furniture and equipment expense
|
1,112 | 990 | 122 | 12.3 | ||||||||||||
FDIC assessment
|
294 | 529 | (235 | ) | (44.4 | ) | ||||||||||
Marketing
|
753 | 658 | 95 | 14.4 | ||||||||||||
Contribution to Farmington Bank Community Foundation, Inc.
|
- | 6,877 | (6,877 | ) | (100.0 | ) | ||||||||||
Other operating expenses
|
2,285 | 2,306 | (21 | ) | (0.9 | ) | ||||||||||
Total noninterest expense
|
$ | 13,161 | $ | 19,927 | $ | (6,766 | ) | (34.0 | )% |
For the Six Months Ended June 30, | ||||||||||||||||
2012
|
2011
|
$ Change
|
% Change
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Net interest income
|
$ | 25,753 | $ | 23,865 | $ | 1,888 | 7.9 | % | ||||||||
Provision for loan losses
|
850 | 600 | 250 | 41.7 | ||||||||||||
Noninterest income
|
3,319 | 2,710 | 609 | 22.5 | ||||||||||||
Noninterest expense
|
25,790 | 31,588 | (5,798 | ) | (18.4 | ) | ||||||||||
Income (loss) before taxes
|
2,432 | (5,613 | ) | 8,045 | (143.3 | ) | ||||||||||
Income tax provision
|
610 | (1,984 | ) | 2,594 | (130.7 | ) | ||||||||||
Net income (loss)
|
$ | 1,822 | $ | (3,629 | ) | $ | 5,451 | (150.2 | )% |
Six Months Ended June 30, | ||||||||||||||||||||||||
2012 | 2011 | |||||||||||||||||||||||
Interest
|
Interest
|
|||||||||||||||||||||||
Average
|
and
|
Average
|
and
|
|||||||||||||||||||||
Balance
|
Dividends
|
Yield/Cost
|
Balance
|
Dividends
|
Yield/Cost
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||
Loans receivable, net
|
$ | 1,338,093 | $ | 29,740 | 4.46 | % | $ | 1,184,335 | $ | 28,291 | 4.82 | % | ||||||||||||
Securities
|
131,935 | 755 | 1.15 | % | 152,052 | 1,033 | 1.37 | % | ||||||||||||||||
Federal Home Loan Bank of Boston stock
|
7,253 | 18 | 0.50 | % | 7,449 | 6 | 0.16 | % | ||||||||||||||||
Fed Funds and other earning assets
|
57,381 | 60 | 0.21 | % | 69,775 | 75 | 0.22 | % | ||||||||||||||||
Total interest-earning assets
|
1,534,662 | 30,573 | 4.00 | % | 1,413,611 | 29,405 | 4.19 | % | ||||||||||||||||
Noninterest-earning assets
|
116,931 | 72,482 | ||||||||||||||||||||||
Total assets
|
$ | 1,651,593 | $ | 1,486,093 | ||||||||||||||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||
NOW accounts
|
$ | 204,771 | $ | 172 | 0.17 | % | $ | 242,804 | $ | 361 | 0.30 | % | ||||||||||||
Money market
|
266,238 | 1,032 | 0.78 | % | 192,225 | 955 | 1.00 | % | ||||||||||||||||
Savings accounts
|
167,973 | 125 | 0.15 | % | 146,967 | 145 | 0.20 | % | ||||||||||||||||
Certificates of deposit
|
374,996 | 2,069 | 1.11 | % | 431,628 | 2,445 | 1.14 | % | ||||||||||||||||
Total interest-bearing deposits
|
1,013,978 | 3,398 | 0.67 | % | 1,013,624 | 3,906 | 0.78 | % | ||||||||||||||||
Advances from the Federal Home Loan Bank
|
62,955 | 943 | 3.00 | % | 68,052 | 1,056 | 3.13 | % | ||||||||||||||||
Repurchase Agreement Borrow ing
|
21,000 | 361 | 3.45 | % | 21,000 | 358 | 3.44 | % | ||||||||||||||||
Repurchase liabilities
|
60,617 | 118 | 0.39 | % | 72,798 | 220 | 0.61 | % | ||||||||||||||||
Total interest-bearing liabilities
|
1,158,550 | 4,820 | 0.83 | % | 1,175,474 | 5,540 | 0.95 | % | ||||||||||||||||
Noninterest-bearing deposits
|
203,033 | 183,484 | ||||||||||||||||||||||
Other noninterest-bearing liabilities
|
38,603 | 27,719 | ||||||||||||||||||||||
Total liabilities
|
1,400,186 | 1,386,677 | ||||||||||||||||||||||
Stockholders’ equity
|
251,407 | 99,416 | ||||||||||||||||||||||
Total liabilities and stockholders’ equity
|
$ | 1,651,593 | $ | 1,486,093 | ||||||||||||||||||||
Net interest income
|
$ | 25,753 | $ | 23,865 | ||||||||||||||||||||
Net interest rate spread (1)
|
3.17 | % | 3.24 | % | ||||||||||||||||||||
Net interest-earning assets (2)
|
$ | 376,112 | $ | 238,137 | ||||||||||||||||||||
Net interest margin (3)
|
3.37 | % | 3.39 | % | ||||||||||||||||||||
Average interest-earning assets to average interest-bearing liabilities
|
132.46 | % | 120.26 | % |
(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.
|
Six Months Ended June 30, 2012 Compared to Six
|
||||||||||||
Months Ended June 30, 2011
|
||||||||||||
Total Increase
|
||||||||||||
(Dollars in thousands)
|
Volume
|
Rate
|
(Decrease)
|
|||||||||
Interest-earning assets:
|
||||||||||||
Loans receivable, net
|
$ | 3,459 | $ | (2,010 | ) | $ | 1,449 | |||||
Investment securities
|
(139 | ) | (139 | ) | (278 | ) | ||||||
Federal Home Loan Bank of Boston stock
|
- | 12 | 12 | |||||||||
Fed Funds and other interest-earning assets
|
(13 | ) | (2 | ) | (15 | ) | ||||||
Total interest-earning assets
|
3,307 | (2,139 | ) | 1,168 | ||||||||
Interest-bearing liabilities:
|
||||||||||||
NOW accounts
|
(52 | ) | (137 | ) | (189 | ) | ||||||
Money market
|
167 | (90 | ) | 77 | ||||||||
Savings accounts
|
14 | (34 | ) | (20 | ) | |||||||
Certificates of deposit
|
(287 | ) | (89 | ) | (376 | ) | ||||||
Total interest-bearing deposits
|
(158 | ) | (350 | ) | (508 | ) | ||||||
Advances from the Federal Home Loan Bank
|
(69 | ) | (44 | ) | (113 | ) | ||||||
Repurchase agreement borrowing
|
- | 3 | 3 | |||||||||
Repurchase liabilities
|
(28 | ) | (74 | ) | (102 | ) | ||||||
Total interest-bearing liabilities
|
(255 | ) | (465 | ) | (720 | ) | ||||||
Increase (decrease) in net interest income
|
$ | 3,562 | $ | (1,674 | ) | $ | 1,888 |
Six Months Ended June 30,
|
||||||||||||||||
2012
|
2011
|
$ Change
|
% Change
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Fees for customer services
|
$ | 1,716 | $ | 1,647 | $ | 69 | 4.2 | % | ||||||||
Net gain on loans sold
|
529 | 345 | 184 | 53.3 | ||||||||||||
Brokerage and insurance fee income
|
57 | 134 | (77 | ) | (57.5 | ) | ||||||||||
Bank owned life insurance income
|
640 | 348 | 292 | 83.9 | ||||||||||||
Other
|
377 | 236 | 141 | 59.7 | ||||||||||||
Total noninterest income
|
$ | 3,319 | $ | 2,710 | $ | 609 | 22.5 | % |
Six Months Ended June 30,
|
||||||||||||||||
2012
|
2011
|
$ Change
|
% Change
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Salaries and employee benefits
|
$ | 15,043 | $ | 14,041 | $ | 1,002 | 7.1 | % | ||||||||
Occupancy expense
|
2,288 | 2,331 | (43 | ) | (1.8 | ) | ||||||||||
Furniture and equipment expense
|
2,211 | 1,965 | 246 | 12.5 | ||||||||||||
FDIC assessment
|
573 | 1,070 | (497 | ) | (46.4 | ) | ||||||||||
Marketing
|
1,359 | 1,131 | 228 | 20.2 | ||||||||||||
Contribution to Farmington Bank Community Foundation, Inc.
|
- | 6,877 | (6,877 | ) | (100.0 | ) | ||||||||||
Other operating expenses
|
4,316 | 4,173 | 143 | 3.4 | ||||||||||||
Total noninterest expense
|
$ | 25,790 | $ | 31,588 | $ | (5,798 | ) | (18.4 | )% |
Percentage Increase (Decrease) in
Estimated Net Interest Income Over 12 Months
|
||||||||
At June 30,
|
At December
|
|||||||
2012
|
31, 2011 | |||||||
300 basis point increase
|
7.75 | % | 8.86 | % | ||||
400 basis point increase
|
7.47 | % | 11.36 | % | ||||
100 basis point decrease
|
(5.34 | )% | (3.90 | )% |
Item 1A.
|
Risk Factors
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
|
(a)
|
Not applicable.
|
|
(b)
|
Not applicable.
|
|
(c)
|
During the quarter ending June 30, 2012, the Employee Stock Ownership Plan made the following purchases of the Company’s stock:
|
(d) Maximum Number
|
||||||||||||||||
(a) Total
|
(c) Total Number of
|
(or Approximate Dollar
|
||||||||||||||
Number of
|
(b) Average
|
Shares (or Units)
|
Value) of Shares (or
|
|||||||||||||
Shares (or
|
Price Paid
|
Purchased as Part of
|
Units) that May Yet Be
|
|||||||||||||
Units)
|
per Share (or
|
Publicly Announced
|
Purchased Under the
|
|||||||||||||
Period
|
Purchased
|
Unit)
|
Plans or Programs
|
Plans or Programs
|
||||||||||||
April 1-30, 2012
|
23,969 | $ | 12.87 | 1,256,809 | 173,607 | |||||||||||
May 1-31, 2012
|
88,778 | 13.06 | 1,345,587 | 84,829 | ||||||||||||
June 1-30, 2012
|
84,829 | 13.01 | 1,430,416 | - |
|
3.1
|
Amended and Restated Certificate of Incorporation of First Connecticut Bancorp, Inc. (filed as Exhibit 3.1 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
3.2
|
Bylaws of First Connecticut Bancorp, Inc. (filed as Exhibit 3.2 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
4.1
|
Form of Common Stock Certificate of First Connecticut Bancorp, Inc. (filed as Exhibit 4.1 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.1
|
Phantom Stock Plan of Farmington Bank (terminated) (filed as Exhibit 10.1 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.2
|
Supplemental Executive Retirement Plan of Farmington Bank (filed as Exhibit 10.2 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.3
|
Voluntary Deferred Compensation Plan for Directors and Key Employees (filed as Exhibit 10.3 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.4
|
First Amendment to Voluntary Deferred Compensation Plan for Directors and Key Employees (filed as Exhibit 10.4 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.5
|
Voluntary Deferred Compensation Plan for Key Employees (filed as Exhibit 10.5 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.6
|
Life Insurance Premium Reimbursement Agreement between Farmington Bank and John J. Patrick, Jr. (filed as Exhibit 10.6 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.7
|
Life Insurance Premium Reimbursement Agreement between Farmington Bank and Gregory A. White (filed as Exhibit 10.7 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.8
|
Farmington Savings Bank Defined Benefit Employees’ Pension Plan, as amended (filed as Exhibit 10.8 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.9
|
Annual Incentive Compensation Plan (filed as Exhibit 10.9 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.10
|
Supplemental Retirement Plan Participation Agreement between John J. Patrick, Jr. and Farmington Bank (filed as Exhibit 10.10 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.11
|
Supplemental Retirement Plan Participation Agreement between Michael T. Schweighoffer and Farmington Bank (filed as Exhibit 10.11 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.12
|
Supplemental Retirement Plan Participation Agreement between Gregory A. White and Farmington Bank (filed as Exhibit 10.12 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
10.13
|
Employment Agreement among First Connecticut Bancorp, Inc., Farmington Bank and John J. Patrick, Jr. (filed as Exhibit 10.1 Employment Agreement on Form 8-K for the Company on April 24, 2012 and incorporated herein by reference).
|
|
10.15
|
First Connecticut Bancorp, Inc. 2012 Stock Incentive Plan (Incorporated by reference to Appendix A in the Definitive Proxy Statement on Form 14A filed on June 6, 2012 and amended on July 2, 2012 (File No. 001-35209-12890818 and 12960688).
|
|
10.14
|
Life Insurance Premium Reimbursement Agreement between Farmington Bank and Michael T. Schweighoffer (filed as Exhibit 10.14 to the Form 10-K filed for the Company on May 15, 2012, and incorporated herein by reference).
|
|
21.1
|
Subsidiaries of First Connecticut Bancorp, Inc. and Farmington Bank (filed as Exhibit 21.1 to the Registration Statement on the Form S-1 filed for the Company on January 28, 2011, as amended, and incorporated herein by reference).
|
|
31.1
|
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, signed by the Company’s Chief Executive Officer.
|
|
31.2
|
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, signed by the Company’s Chief Financial Officer.
|
|
32.1
|
Written Statement pursuant to 18 U.S.C. § 1350, as created by section 906 of the Sarbanes-Oxley Act of 2002, signed by the Company’s Chief Executive Officer.
|
|
32.2
|
Written Statement pursuant to 18 U.S.C. § 1350, as created by section 906 of the Sarbanes-Oxley Act of 2002, signed by the Company’s Chief Financial Officer.
|
|
101
|
Interactive data files pursuant to Rule 405 of Regulation S-t: (i) the Consolidated Statements of Condition, (ii) the Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income (iv) the Consolidated Statement of Changes in Stockholders’ Equity, (v) the Consolidated Statements of Cash Flows, and (vi) Notes to Unaudited Consolidated Financial Statements tagged as blocks of text and in detail.*
|
|
*
|
As provided in Rule 406T of Regulation S-T, this information is furnished and not filed for purposes of Sections 11 and 12 of the Securities Act of 1933 and Section 18 of the Securities Act of 1934.
|
FIRST CONNECTICUT BANCORP, INC.
|
||
Date: August 10, 2012
|
/s/ John J. Patrick, Jr.
|
|
John J. Patrick, Jr.
|
||
Chairman, President and Chief Executive Officer
|
||
Date: August 10, 2012
|
/s/ Gregory A. White
|
|
Gregory A. White
|
||
Executive Vice President and Chief Financial Officer
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of First Connecticut Bancorp, Inc., a Maryland corporation;
|
|
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 15-15(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)
|
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
|
|
c)
|
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 (the registrant’s fourth fiscal quarter in the case of an annual report) 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:
|
|
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.
|
Date: August 10, 2012
|
/s/ John J. Patrick, Jr.
|
|
John J. Patrick, Jr.
|
||
Chairman, President and Chief Executive Officer
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of First Connecticut Bancorp, Inc., a Maryland corporation;
|
|
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 15-15(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)
|
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
|
|
c)
|
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 (the registrant’s fourth fiscal quarter in the case of an annual report) 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:
|
|
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.
|
Date: August 10, 2012
|
/s/ Gregory A. White
|
|
Gregory A. White
|
||
Executive Vice President and Chief Financial Officer
|
|
1.
|
the Report fully complies with the requirements of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
|
2.
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: August 10, 2012
|
/s/ John J. Patrick, Jr.
|
|
John J. Patrick, Jr.
|
||
Chairman, President and Chief Executive Officer
|
|
1.
|
the Report fully complies with the requirements of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
|
2.
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: August 10, 2012
|
/s/ Gregory A. White
|
|
Gregory A. White
|
||
Executive Vice President and Chief Financial Officer
|
Loans and Allowance for Loan Losses - Changes in allowance for loan losses (Details 1) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2012
|
Jun. 30, 2011
|
Jun. 30, 2012
|
Jun. 30, 2011
|
|
Allowance for Loan and Lease Losses [Roll Forward] | ||||
Balance at beginning of period | $ 17,727 | $ 20,562 | $ 17,533 | $ 20,734 |
Provision for loan losses | 520 | 300 | 850 | 600 |
Charge-offs | (492) | (4,963) | (640) | (5,439) |
Recoveries | 172 | 13 | 184 | 17 |
Balance at end of period | $ 17,927 | $ 15,912 | $ 17,927 | $ 15,912 |
Credit Arrangements ( Details Textuals 3) (USD $)
|
Jun. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Schedule of Investments [Line Items] | ||
Repurchase liabilities | $ 67,534,000 | $ 64,466,000 |
US Treasury Bill Securities
|
||
Schedule of Investments [Line Items] | ||
Treasury bill securities with a fair value | 25,000,000 | 25,000,000 |
Cash for securing repurchase agreement | 451,000 | 451,000 |
Outstanding borrowings | 21,000,000 | 21,000,000 |
Repurchase liabilities | 67,500,000 | 64,500,000 |
Market Value Of Investment For Securing Repurchase Liability | $ 77,600,000 | $ 79,200,000 |
Deposits - Summary (Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Banking and Thrift [Abstract] | ||
Noninterest-bearing demand deposits | $ 223,820 | $ 195,625 |
Interest-bearing | ||
NOW accounts | 181,464 | 189,577 |
Money market | 272,287 | 247,693 |
Savings accounts | 178,378 | 157,913 |
Time deposits | 362,794 | 385,874 |
Total deposits | $ 1,218,743 | $ 1,176,682 |
Investment Securities - Summary (Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Available-for-sale | ||
Available-for-sale securities amortized cost | $ 129,467 | $ 134,185 |
Available-for-sale securities gross unrealized gains | 1,456 | 1,648 |
Available-for-sale securities gross unrealized losses | (537) | (663) |
Available-for-sale securities estimated market value | 130,386 | 135,170 |
Held-to-maturity | ||
Held-to-maturity Securities amortized cost | 3,007 | 3,216 |
Held-to-maturity Securities gross unrealized gains | ||
Held-to-maturity securities gross unrealized losses | ||
Held-to-maturity securities market value | 3,007 | 3,216 |
U.S. Treasury obligations
|
||
Available-for-sale | ||
Available-for-sale securities amortized cost | 93,985 | 80,999 |
Available-for-sale securities gross unrealized gains | 2 | |
Available-for-sale securities gross unrealized losses | (2) | |
Available-for-sale securities estimated market value | 93,985 | 80,999 |
U.S. Government agency obligations
|
||
Available-for-sale | ||
Available-for-sale securities amortized cost | 12,000 | 27,003 |
Available-for-sale securities gross unrealized gains | 18 | 12 |
Available-for-sale securities gross unrealized losses | 9 | |
Available-for-sale securities estimated market value | 12,018 | 27,006 |
Government sponsored residential mortgage-backed securities
|
||
Available-for-sale | ||
Available-for-sale securities amortized cost | 14,536 | 19,254 |
Available-for-sale securities gross unrealized gains | 1,105 | 1,302 |
Available-for-sale securities gross unrealized losses | (2) | (11) |
Available-for-sale securities estimated market value | 15,639 | 27,006 |
Held-to-maturity | ||
Held-to-maturity Securities amortized cost | 7 | 7 |
Held-to-maturity Securities gross unrealized gains | ||
Held-to-maturity securities gross unrealized losses | ||
Held-to-maturity securities market value | 7 | 7 |
Corporate debt securities
|
||
Available-for-sale | ||
Available-for-sale securities amortized cost | 2,946 | 1,000 |
Available-for-sale securities gross unrealized gains | 197 | 175 |
Available-for-sale securities gross unrealized losses | ||
Available-for-sale securities estimated market value | 3,143 | 1,175 |
Municipal debt securities
|
||
Held-to-maturity | ||
Held-to-maturity Securities amortized cost | 209 | |
Held-to-maturity Securities gross unrealized gains | ||
Held-to-maturity securities gross unrealized losses | ||
Held-to-maturity securities market value | 209 | |
Trust preferred debt securities
|
||
Available-for-sale | ||
Available-for-sale securities amortized cost | 37 | 42 |
Available-for-sale securities gross unrealized gains | ||
Available-for-sale securities gross unrealized losses | ||
Available-for-sale securities estimated market value | 37 | 42 |
Held-to-maturity | ||
Held-to-maturity Securities amortized cost | 3,000 | 3,000 |
Held-to-maturity Securities gross unrealized gains | ||
Held-to-maturity securities gross unrealized losses | ||
Held-to-maturity securities market value | 3,000 | 3,000 |
Preferred equity securities
|
||
Available-for-sale | ||
Available-for-sale securities amortized cost | 2,100 | 2,100 |
Available-for-sale securities gross unrealized gains | 81 | 112 |
Available-for-sale securities gross unrealized losses | (529) | (639) |
Available-for-sale securities estimated market value | 1,652 | 1,573 |
Marketable equity securities
|
||
Available-for-sale | ||
Available-for-sale securities amortized cost | 348 | 348 |
Available-for-sale securities gross unrealized gains | 33 | 22 |
Available-for-sale securities gross unrealized losses | (4) | (4) |
Available-for-sale securities estimated market value | 377 | 366 |
Mutual funds
|
||
Available-for-sale | ||
Available-for-sale securities amortized cost | 3,515 | 3,439 |
Available-for-sale securities gross unrealized gains | 20 | 25 |
Available-for-sale securities gross unrealized losses | ||
Available-for-sale securities estimated market value | $ 3,535 | $ 3,464 |
Pension and Other Postretirement Benefit Plans - Shares held by the ESOP (Details 1)
|
Jun. 30, 2012
|
---|---|
Compensation and Retirement Disclosure [Abstract] | |
Allocated | 95,361 |
Committed to be released | 47,420 |
Unallocated | 1,287,635 |
Total shares held by the ESOP | 1,430,416 |
Deposits (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2012
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Banking and Thrift [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Deposits |
|
Loans and Allowance for Loan Losses (Details Textuals 1) (Loans receivable, USD $)
|
Jun. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Loans receivable
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans and leases receivable related parties | $ 728,000 | $ 561,000 |
Loans and Allowance for Loan Losses - Summary of loan delinquencies at recorded investment (Details 4) (Loans receivable, USD $)
In Thousands, unless otherwise specified |
Jun. 30, 2012
Loan
|
Dec. 31, 2011
Loan
|
---|---|---|
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | 20 | 31 |
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | $ 2,220 | $ 4,230 |
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | 5 | 5 |
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | 308 | 808 |
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | 39 | 45 |
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | 12,762 | 13,789 |
Number Of Loan Receivable Recorded Investment Past Due | 64 | 81 |
Loan Receivable, Recorded Investment, Past Due | 15,290 | 18,827 |
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | ||
Real estate Residential
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | 10 | 12 |
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | 1,840 | 2,955 |
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | 1 | 4 |
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | 203 | 730 |
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | 22 | 17 |
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | 8,658 | 7,926 |
Number Of Loan Receivable Recorded Investment Past Due | 33 | 33 |
Loan Receivable, Recorded Investment, Past Due | 10,701 | 11,611 |
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | ||
Real estate Commercial
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | 1 | |
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | 963 | |
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | ||
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | ||
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | 4 | 9 |
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | 1,275 | 2,934 |
Number Of Loan Receivable Recorded Investment Past Due | 4 | 10 |
Loan Receivable, Recorded Investment, Past Due | 1,275 | 3,897 |
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | ||
Real estate Construction
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | ||
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | ||
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | ||
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | ||
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | 1 | 2 |
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | 484 | 484 |
Number Of Loan Receivable Recorded Investment Past Due | 1 | 2 |
Loan Receivable, Recorded Investment, Past Due | 484 | 484 |
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | ||
Installment
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | 2 | 5 |
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | 10 | 22 |
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | 3 | 1 |
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | 35 | 78 |
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | 2 | 2 |
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | 54 | 63 |
Number Of Loan Receivable Recorded Investment Past Due | 7 | 8 |
Loan Receivable, Recorded Investment, Past Due | 99 | 163 |
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | ||
Commercial
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | 2 | |
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | 190 | |
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | ||
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | ||
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | 4 | 8 |
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | 740 | 802 |
Number Of Loan Receivable Recorded Investment Past Due | 6 | 8 |
Loan Receivable, Recorded Investment, Past Due | 930 | 802 |
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | ||
Collateral
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | 5 | 9 |
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | 82 | 70 |
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | ||
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | ||
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | ||
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | ||
Number Of Loan Receivable Recorded Investment Past Due | 5 | 9 |
Loan Receivable, Recorded Investment, Past Due | 82 | 70 |
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | ||
Home equity line of credit
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | 1 | 3 |
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | 98 | 204 |
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | 1 | |
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | 70 | |
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | 5 | 6 |
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | 1,526 | 1,555 |
Number Of Loan Receivable Recorded Investment Past Due | 7 | 9 |
Loan Receivable, Recorded Investment, Past Due | 1,694 | 1,759 |
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | ||
Demand
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | 1 | |
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | 16 | |
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | ||
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | ||
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | 1 | 1 |
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | 25 | 25 |
Number Of Loan Receivable Recorded Investment Past Due | 1 | 2 |
Loan Receivable, Recorded Investment, Past Due | 25 | 41 |
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | ||
Revolving credit
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | ||
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | ||
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | ||
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | ||
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | ||
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | ||
Number Of Loan Receivable Recorded Investment Past Due | ||
Loan Receivable, Recorded Investment, Past Due | ||
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | ||
Resort
|
||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number Of Loan Receivable, Recorded Investment, 30 To 59 Days Past Due | ||
Loan Receivable, Recorded Investment, 30 to 59 Days Past Due | ||
Number Of Loan Receivable Recorded Investment 60 To 89 Days Past Due | ||
Loan Receivable, Recorded Investment, 60 to 89 Days Past Due | ||
Number Of Loan Receivable Recorded Investment Equal To Greater Than 90 Days Past Due | ||
Loan Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due | ||
Number Of Loan Receivable Recorded Investment Past Due | ||
Loan Receivable, Recorded Investment, Past Due | ||
Loan Receivable, Recorded Investment, 90 Days Past Due and Still Accruing |
Investment Securities (Details Textuals 1) (USD $)
In Thousands, unless otherwise specified |
Jun. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
FHLB Stock | $ 7,137 | $ 7,449 |
Federal Home Loan Bank Of Boston
|
||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
FHLB Stock | $ 7,100 | $ 7,400 |
Credit Arrangements (Details Textuals 1) (Discount Window Loan Collateral Program, USD $)
In Millions, unless otherwise specified |
Jun. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Discount Window Loan Collateral Program
|
||
Line Of Program [Line Items] | ||
Amount borrowed through Federal Reserve Bank's discount window loan collateral program | $ 79.8 | $ 84.6 |
Pledged commercial real estate loans | $ 125.8 | $ 119.4 |
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis (Details 2) (Fair value, measurements, nonrecurring, USD $)
In Thousands, unless otherwise specified |
Jun. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Quoted Prices in Active Markets for Identical Assets (Level 1)
|
||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Mortgage servicing rights | ||
Loans held for sale | ||
Impaired loans | ||
Other real estate owned | ||
Significant Observable Inputs (Level 2)
|
||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Mortgage servicing rights | ||
Loans held for sale | 1,667 | 1,039 |
Impaired loans | ||
Other real estate owned | ||
Significant Unobservable Inputs (Level 3)
|
||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Mortgage servicing rights | 607 | 594 |
Loans held for sale | ||
Impaired loans | 37,691 | 38,783 |
Other real estate owned | $ 376 | $ 302 |
Derivative Financial Instruments - Changes in the fair value of non-hedge accounting derivatives (Details 1) (Not Designated as Hedging Instrument, USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2012
|
Jun. 30, 2011
|
Jun. 30, 2012
|
Jun. 30, 2011
|
|
Commercial loan customer interest rate swap position
|
||||
Derivative [Line Items] | ||||
Changes in fair value of non-hedge accounting derivatives | $ 572 | $ 505 | $ 1,121 | $ 1,076 |
Commercial loan customer interest rate swap position | Interest Income Recorded in Interest Income
|
||||
Derivative [Line Items] | ||||
Changes in fair value of non-hedge accounting derivatives | 572 | 505 | 1,121 | 1,076 |
Commercial loan customer interest rate swap position | MTM (Loss) Gain Recorded in Noninterest Income
|
||||
Derivative [Line Items] | ||||
Changes in fair value of non-hedge accounting derivatives | ||||
Counterparty interest rate swap position
|
||||
Derivative [Line Items] | ||||
Changes in fair value of non-hedge accounting derivatives | (572) | (505) | (1,121) | (1,076) |
Counterparty interest rate swap position | Interest Income Recorded in Interest Income
|
||||
Derivative [Line Items] | ||||
Changes in fair value of non-hedge accounting derivatives | (572) | (505) | (1,121) | (1,076) |
Counterparty interest rate swap position | MTM (Loss) Gain Recorded in Noninterest Income
|
||||
Derivative [Line Items] | ||||
Changes in fair value of non-hedge accounting derivatives | ||||
Interest rate swap derivative
|
||||
Derivative [Line Items] | ||||
Changes in fair value of non-hedge accounting derivatives | ||||
Interest rate swap derivative | Interest Income Recorded in Interest Income
|
||||
Derivative [Line Items] | ||||
Changes in fair value of non-hedge accounting derivatives | ||||
Interest rate swap derivative | MTM (Loss) Gain Recorded in Noninterest Income
|
||||
Derivative [Line Items] | ||||
Changes in fair value of non-hedge accounting derivatives |
Loans and Allowance for Loan Losses - TDR loans (Details 9) (Loans receivable, USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2012
Contracts
|
Jun. 30, 2012
Contracts
|
|||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Number of Modifications | 10 | 15 | ||||
Extended Maturity | $ 1,754 | $ 3,910 | ||||
Adjusted Interest Rates | 3,301 | 3,423 | ||||
Combination of Rate and Maturity | 169 | 169 | ||||
Other | 3,712 | 3,712 | ||||
Recorded Investment After Modification | 8,936 | [1] | 11,214 | [1] | ||
Real estate Residential
|
||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Number of Modifications | 1 | 2 | ||||
Extended Maturity | ||||||
Adjusted Interest Rates | 115 | |||||
Combination of Rate and Maturity | ||||||
Other | 462 | 462 | ||||
Recorded Investment After Modification | 462 | [1] | 577 | [1] | ||
Real estate Commercial
|
||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Number of Modifications | 5 | 5 | ||||
Extended Maturity | 1,754 | 1,754 | ||||
Adjusted Interest Rates | 3,301 | 3,301 | ||||
Combination of Rate and Maturity | ||||||
Other | 3,250 | 3,250 | ||||
Recorded Investment After Modification | 8,305 | [1] | 8,305 | [1] | ||
Real estate Construction
|
||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Number of Modifications | 1 | |||||
Extended Maturity | 241 | |||||
Adjusted Interest Rates | ||||||
Combination of Rate and Maturity | ||||||
Other | ||||||
Recorded Investment After Modification | [1] | 241 | [1] | |||
Installment
|
||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Number of Modifications | 1 | |||||
Extended Maturity | ||||||
Adjusted Interest Rates | 7 | |||||
Combination of Rate and Maturity | ||||||
Other | ||||||
Recorded Investment After Modification | [1] | 7 | [1] | |||
Commercial
|
||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Number of Modifications | 4 | 6 | ||||
Extended Maturity | 1,915 | |||||
Adjusted Interest Rates | ||||||
Combination of Rate and Maturity | 169 | 169 | ||||
Other | ||||||
Recorded Investment After Modification | $ 169 | [1] | $ 2,084 | [1] | ||
|
Summary of Significant Accounting Policies
|
6 Months Ended |
---|---|
Jun. 30, 2012
|
|
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 1. Summary of Significant Accounting Policies
Organization and Business
On June 29, 2011, the Boards of Directors of Farmington Bank, a Connecticut stock savings bank (the “Bank”), First Connecticut Bancorp, Inc., a Maryland-chartered corporation (the “Company”), First Connecticut Bancorp, Inc., a Connecticut-chartered nonstock corporation and mutual holding company (the “MHC”) and Farmington Holdings, Inc., a Connecticut-chartered corporation (the “Mid-Tier”) completed a Plan of Conversion and Reorganization whereby: (1) the MHC converted from the mutual holding company form of organization to the stock holding company form of organization, (2) the Company sold shares of common stock of the Company in a subscription offering, and (3) the Company contributed shares of Company common stock equal to 4.0% of the shares sold in the subscription offering to the Farmington Bank Community Foundation, Inc. (the “Conversion and Reorganization”). First Connecticut Bancorp, Inc. sold 17,192,500 shares of its common stock to eligible stock holders at $10.00 per share for proceeds of $167.8 million, net of offering costs of $4.1 million. On June 29, 2011, with the completion of the Conversion and Reorganization, First Connecticut Bancorp, Inc. is 100% owned by public shareholders and the MHC and the Mid-Tier ceased to exist.
As part of the reorganization, the Company established an Employee Stock Ownership Plan (“ESOP”) for eligible employees. The Company loaned the ESOP the amount needed to purchase up to 1,430,416 shares or 8.0% of the Company’s common stock issued in the offering. As of June 30, 2012, the ESOP completed its purchase of 1,430,416 shares of common stock at a cost of $16.9 million. The Bank makes annual contributions adequate to fund the payment of regular debt service requirements attributable to the indebtedness of the ESOP.
On July 2, 2012, the Company received regulatory approval to repurchase up to 1,788,020 shares, or 10% of its current outstanding common stock. Repurchased shares will be held as treasury stock and will be available for general corporate purposes.
The consolidated financial statements include the accounts of First Connecticut Bancorp, Inc. and its wholly-owned subsidiary, Farmington Bank, (collectively, the “Company”). Significant inter-company accounts and transactions have been eliminated in consolidation.
First Connecticut Bancorp, Inc.’s only subsidiary is Farmington Bank. Farmington Bank’s main office is located in Farmington, Connecticut. Farmington Bank operates eighteen full service branch offices and four limited services offices in central Connecticut. Farmington Bank’s primary source of income is interest received on loans to customers, which include small and middle market businesses and individuals residing within Farmington Bank’s service area.
Wholly-owned subsidiaries of Farmington Bank include Farmington Savings Loan Servicing, Inc., a passive investment company that was established to service and hold loans collateralized by real property; Village Investments, Inc. presently inactive; the Village Corp., Limited, a subsidiary that holds certain real estate; 28 Main Street Corp., a subsidiary that holds residential other real estate owned; Village Management Corp., a subsidiary that holds commercial other real estate owned and Village Square Holdings, Inc., a subsidiary that holds certain bank premises and other real estate.
Basis of Financial Statement Presentation
The consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. The Company has condensed or omitted certain information and footnote disclosures normally included in the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America pursuant to such rules and regulations. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement have been included. All significant intercompany transactions and balances have been eliminated in consolidation. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the year ended December 31, 2011 included in the Company’s 10-K filed on March 28, 2012. The results of operations for the interim periods are not necessarily indicative of the results for the full year.
In preparing the consolidated financial statements, management is required to make extensive use of estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the statement of condition and revenues and expenses for the interim period. Actual results could differ significantly from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, investment security other-than-temporary impairment judgments and investment security valuation.
Reclassifications
Amounts in prior period consolidated financial statements are reclassified whenever necessary to conform to the current year presentation.
Recent Accounting Pronouncements
In December 2011, the FASB issued ASU No. 2011-11, “Disclosures About Offsetting Assets and Liabilities.” This project began as an attempt to converge the offsetting requirements under U.S. GAAP and IFRS. However, as the Boards were not able to reach a converged solution with regards to offsetting requirements, the Boards developed convergent disclosure requirements to assist in reconciling differences in the offsetting requirements under U.S. GAAP and IFRS. The new disclosure requirements mandate that entities disclose both gross and net information about instruments and transactions eligible for offset in the statement of financial position as well as instruments and transactions subject to an agreement similar to a master netting arrangement. ASU No. 2011-11 also requires disclosure of collateral received and posted in connection with master netting agreements or similar arrangements. ASU No. 2011-11 is effective for interim and annual reporting periods beginning on or after January 1, 2013. As the provisions of ASU No. 2011-11 only impact the disclosure requirements related to the offsetting of assets and liabilities, the adoption will have no impact on the Company’s consolidated financial statements.
In June 2011, the FASB issued ASU No. 2011-05, “Presentation of Comprehensive Income.” The provisions of ASU No. 2011-05 allow an entity the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In both options, an entity is required to present each component of net income along with total net income, each component of other comprehensive income along with a total for other comprehensive income, and a total amount for comprehensive income. Under either method, entities are required to present on the face of the financial statements reclassification adjustments for items that are reclassified from other comprehensive income to net income in the statement(s) where the components of net income and the components of other comprehensive income are presented. ASU No. 2011-05 also eliminates the option to present the components of other comprehensive income as part of the statement of changes in shareholders’ equity but does not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income. ASU No. 2011-05 was effective for the Company’s interim reporting period beginning on or after January 1, 2012, with retrospective application required. In December 2011, the FASB issued ASU No. 2011-12, “Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05.” The provisions of ASU No. 2011-12 defer indefinitely the requirement for entities to present reclassification adjustments out of accumulated other comprehensive income by component in both the statement in which net income is presented and the statement in which other comprehensive income is presented. ASU No. 2011-12, which shares the same effective date as ASU No. 2011-05, does not defer the requirement for entities to present components of comprehensive income in either a single continuous statement of comprehensive income or in two separate but consecutive statements. The Company adopted the provisions of ASU No. 2011-05 and ASU No. 2011-12 effective March 31, 2012. The adoption of ASU No. 2011-05 and ASU No. 2011-12 had no impact on the Company’s consolidated statements of income and condition.
ASU No. 2011-04, “Fair Value Measurement (Topic 820) - Amendments to Achieve Common Fair Value Measurements and Disclosure Requirements in U.S. GAAP and IFRSs.” In May 2011, the FASB issued ASU No. 2011-04 which superseded most of the accounting guidance currently found in Topic 820 of FASB’s ASC. The amendments improved comparability of fair value measurements presented and disclosed in financial statements prepared with GAAP and International Financial Reporting Standards (“IFRS”). The amendments also clarified the application of existing fair value measurement requirements. These amendments include (1) the application of the highest and best use and valuation premise concepts, (2) measuring the fair value of an instrument classified in a reporting entity’s shareholders’ equity and (3) disclosing quantitative information about the unobservable inputs used within the Level 3 hierarchy. The Company adopted the provisions of ASU No. 2011-04 effective January 1, 2012 and has been applied prospectively. The fair value measurement provisions of ASU No. 2011-04 had no impact on the Company’s consolidated financial statements. See Note 10 to the consolidated financial statements for the enhanced disclosures required by ASU No. 2011-04.
ASU No. 2011-03, “Transfers and Servicing (Topic 860) - Reconsideration of Effective Control for Repurchase Agreements.” In April 2011, the FASB issued ASU No. 2011-03 to clarify the determination of whether an entity may or may not recognize a sale upon transfer of financial assets subject to repurchase agreements. The changes remove from the assessment of effective control: (i) the criterion requiring the transferor to have the ability to repurchase or redeem the financial assets on substantially the agreed terms, even in the event of default by the transferee, and (ii) the collateral maintenance implementation guidance related to that criterion. As a result, it is anticipated that most repurchase agreements will not qualify for derecognition from the transferor’s financial statements. The Company adopted the provisions of ASU No. 2011-03 effective December 31, 2011. As the Company accounted for all of its repurchase agreements as collateralized financing arrangements prior to the adoption of ASU No. 2011-03, the adoption had no impact on the Company’s Consolidated Financial Statements.
|
Derivative Financial Instruments (Details Textuals) (USD $)
|
Jun. 30, 2012
|
---|---|
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Long term commercial loan | $ 1,000,000 |
Maintainance of cash balance with PNC bank as security against derivative liability | 9,000,000 |
Fair value of pledged a mortgage backed security with PNC bank | 89,000 |
Outstanding receivables secured in excess of by PNC bank | 10,000,000 |
Mortgage-backed securities outstanding rate locks totaled | 9,000,000 |
Sell residential mortgage-backed securities totaled | 10,100,000 |
Forward sales contract | $ 6,300,000 |