Cambridge Bancorp (OTC BB: CATC) today reported unaudited net income of $2,746,000 for the first quarter of 2010, or $0.73 per diluted share, compared to $2,006,000, or $0.54 per diluted share, for the same quarter in 2009. The quarter-over-quarter earnings increase of $740,000 (36.9%) was attributable to a combination of higher net interest income and a rebound in non-interest income for the period.

“We are pleased to report another solid quarter,” noted Joseph V. Roller II, president and CEO, “The Bank continued to build momentum as we targeted opportunities for growth. Loan growth, particularly residential mortgages which increased by $12.0 million for the quarter, and wealth management income were key contributors to the sustained earnings increase.”

The Bank had a strong performance in net interest income which increased $1.4 million (15.0%) in the first quarter 2010 compared to the first quarter in 2009. The Bank’s net interest margin of 4.32% for the three months ended March 31, 2010 compared favorably to 4.20% for the first quarter of 2009. Total deposits increased by $6.8 million to $880 million since year-end 2009 and by $77.5 million (9.7%) over the same quarter in 2009.

Non-interest income for the first quarter of 2010 was $477,000 higher than the same quarter in 2009. Fees from wealth management improved with the equity market and were $409,000 higher in the first quarter of 2010 versus 2009. In addition, gains taken on investment securities were $138,000 in the most recent quarter compared to a negligible amount in the first quarter of 2009.

Non-interest expenses increased by $528,000 in the first quarter of 2010 compared to the same quarter in 2009. The primary factor of higher non-interest expenses were salaries and benefits, due to merit increases as well as larger expense accruals for the Bank’s defined benefit retirement plan.

Non-performing loans as a percentage of total loans stood at 0.21% at March 31, 2010, a slight increase compared to 0.20% at December 31, 2009. Loan quality remains sound and the Allowance for Loan Losses stood at $9.1 million or 1.67% of total loans outstanding at March 31, 2010. At December 31, 2009, the Allowance for Loan Losses was $8.7 million or 1.62% of total loans outstanding.

Cambridge Bancorp and its subsidiary, Cambridge Trust Company, are based in Cambridge, Massachusetts, in the heart of Harvard Square. Cambridge Trust Company is a 120-year-old Massachusetts chartered commercial bank with $1.0 billion in total assets and ten Massachusetts locations in Cambridge, Beacon Hill, Belmont, Concord, Lincoln, and Weston. Cambridge Trust Company is one of New England’s leaders in wealth management with $1.4 billion in client assets under management. In addition, Cambridge Trust Company of New Hampshire offers wealth management services at two New Hampshire locations, Concord and Exeter.

The accompanying unaudited condensed interim consolidated financial information should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Cambridge Bancorp 2009 Annual Report, which is posted in the investor relations section of our website at www.cambridgetrust.com/about/investor_relations.html. We will also post supplemental financial information for first quarter of 2010 at the same site on April 30, 2010. Interim results are not necessarily reflective of the results for the entire year.

Financial Highlights:
CAMBRIDGE BANCORP
QUARTERLY UNAUDITED RESULTS
March 31, 2010
Dollar amounts in thousands (except share data)
     
 
Quarter Ended
March 31,
2010 2009
 
Interest Income $ 11,684 $ 11,127
Interest Expense   1,311   2,109
Net Interest Income 10,373 9,018
Provision for Loan Losses 300 300
Non-Interest Income 4,120 3,643
Non-Interest Expense   10,090   9,562
Income Before Taxes 4,103 2,799
Income Taxes   1,357   793
Net Income $ 2,746 $ 2,006
 

Data Per Common Share:
 
Basic Earnings Per Share $ 0.74 $ 0.54
Diluted Earnings Per Share $ 0.73 $ 0.54
Dividends Declared Per Share $ 0.35 $ 0.33
 
Avg. Common Shares Outstanding:
Basic 3,724,353 3,716,559
Diluted 3,736,468 3,718,917
 

Selected Operating Ratios:
 
Net Interest Margin 4.32% 4.20%
Return on Average Assets, after taxes 1.09% 0.88%
Return on Average Equity, after taxes 12.90% 10.65%
 
 
March 31, December 31, March 31,
2010 2009 2009
 
Total Assets $ 1,020,840 $ 1,018,949 $ 934,160
Total Loans 544,601 537,933 468,788
Non-Performing Loans 1,122 1,092 1,875
Allowance for Loan Losses 9,101 8,729 7,951
Allowance to Non-Performing Loans 810.79% 799.72% 424.01%
Allowance to Total Loans 1.67% 1.62% 1.70%
Total Deposits 879,521 872,767 802,056
Total Stockholders' Equity 84,155 81,708 77,641
 
Book Value Per Share $ 22.53 $ 21.95 $ 20.81
Tangible Book Value Per Share $ 22.30 $ 21.69 $ 20.48
 
 
CAMBRIDGE BANCORP
UNAUDITED CONSOLIDATED BALANCE SHEETS
     
March 31, December 31,
2010 2009
(In thousands)
ASSETS
 
Cash and due from banks $ 40,194 $ 12,762
Overnight investments 13,412
Total cash and cash equivalents 40,194 26,174
Investment securities:
Available for sale, at fair value 320,734 339,833
Held-to-maturity, at amortized cost 85,766 84,073
Total investment securities 406,500 423,906
Loans:
Residential mortgage 253,574 241,564
Commercial mortgage 163,993 162,002
Home equity 67,127 69,212
Commercial 44,661 48,291
Consumer 15,246 16,864
Total loans 544,601 537,933
Allowance for loan losses (9,101) (8,729)
Net loans 535,500 529,204
 
Stock in FHLB of Boston, at cost 4,806 4,806
Bank owned life insurance 11,759 11,672
Banking premises and equipment, net 5,434 5,562
Other real estate owned 696 696
Accrued interest receivable 3,838 4,470
Other assets 12,113 12,459
Total assets $ 1,020,840 $ 1,018,949
 
LIABILITIES AND STOCKHOLDERS' EQUITY
 
Deposits:
Demand $ 200,648 $ 204,335
Interest bearing checking 232,964 238,152
Money market 61,777 53,099
Savings 235,954 224,360
Certificates of deposit 148,178 152,821
Total deposits 879,521 872,767
 
Short-term borrowings 12,179 11,441
Long-term borrowings 30,000 38,000
Other liabilities 14,985 15,033
Total liabilities 936,685 937,241
Stockholders' equity:
Common stock, par value $1.00; Authorized
5,000,000 shares; Outstanding: 3,735,767 and
3,748,642 shares, respectively 3,736 3,723
Additional paid-in capital 20,868 20,431
Retained earnings 55,118 53,676
Accumulated other comprehensive income 4,433 3,878
Total stockholders’ equity 84,155 81,708
Total liabilities and stockholders’ equity $ 1,020,840 $ 1,018,949
 
 
CAMBRIDGE BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
         
 
Quarter Ended March 31,
2010 2009
(In thousands, except per share data)
 
Interest income:
Interest on loans $ 7,367 $ 6,562
Interest on taxable investment securities 3,865 4,160
Interest on tax exempt investment securities 447 396
Interest on overnight investments 5 9
Total interest income 11,684 11,127
 
Interest expense:
Interest on deposits 956 1,588
Interest on borrowed funds 355 521
Total interest expense 1,311 2,109
 
Net interest income 10,373 9,018
 
Provision for loan losses 300 300
 
Net interest income after provision for loan losses 10,073 8,718
 
Noninterest income:
Wealth management income 2,877 2,468
Deposit account fees 502 597
ATM/Debit card income 218 190
Merchant card services 138 111
Bank owned life insurance income 87 107
Gain on disposition of investment securities 138 2
Other income 160 168
Total noninterest income 4,120 3,643
 
Noninterest expense:
Salaries and employee benefits 5,818 5,440
Occupancy and equipment 1,643 1,669
Data processing 812 801
Professional services 384 305
Marketing 375 350
FDIC Insurance 292 312
Other expenses 766 685
Total noninterest expense 10,090 9,562
 
Income before income taxes 4,103 2,799
 
Income tax expense 1,357 793
   
Net income $ 2,746 $ 2,006
 
Per share data:
 
Basic earnings per common share $ 0.74 $ 0.54
Diluted earnings per common share $ 0.73 $ 0.54
 
Average shares outstanding - basic 3,724,353 3,716,559
Average shares outstanding - diluted 3,736,468 3,718,917
 
 
CAMBRIDGE BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
           
 
Quarter Ended March 31,
2010 2009
(In thousands)
Cash flows provided by operating activities:
Net income $ 2,746 $ 2,006

Adjustments to reconcile net income to net cashprovided by operating activities:
 
Provision for loan losses 300 300
Amortization of deferred charges/(income), net 125 (23)
Depreciation and amortization 355 337
Bank owned life insurance income (87) (107)
Gain on disposition of investment securities (138) (2)

Compensation expense from stock optionand restricted stock grants
75 76
Change in accrued interest receivable,other assets and other liabilities
540 466
Other, net 96 17
Net cash provided by operating activities 4,012 3,070
Cash flows provided/(used) by investing activities:
Origination of loans (31,371) (25,230)
Purchase of:
Investment securities - AFS (39,493) (50,196)
Investment securities - HTM (3,143) (437)
Maturities, calls and principal payments of:
Loans 24,602 28,125
Investment securities - AFS 30,665 29,456
Investment securities - HTM 1,418 1,495
Proceeds from sale of investment securities - AFS 28,994 2
Purchase of banking premises and equipment (227) (399)
Net cash provided/(used) by investing activities 11,445 (17,184)
Cash flows provided/(used) by financing activities:
Net increase in deposits 6,754 34,402
Net increase/(decrease) in short-term borrowings 738 (2,146)
Repayment of long-term borrowings (8,000) (17,000)
Proceeds from issuance of common stock 375 355
Repurchase of common stock (697)
Cash dividends paid on common stock (1,304) (1,227)
Net cash provided/(used) by financing activities (1,437) 13,687
Net increase (decrease) in cash and cash equivalents 14,020 (427)
Cash and cash equivalents at beginning of period 26,174 39,651
Cash and cash equivalents at end of period $ 40,194 $ 39,224
 
Supplemental disclosure of cash flow information:
Cash paid for interest $ 1,319 $ 2,115
Cash paid for income taxes 550 95
Non-cash transactions:
Change in accumulated other comprehensiveincome, net of taxes
555 1,083

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