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First Connecticut Bancorp, Inc. Announces Fourth Quarter 2012 Results

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FARMINGTON, Conn., March 1, 2013 (GLOBE NEWSWIRE) -- First Connecticut Bancorp, Inc. (the "Company") (Nasdaq:FBNK), the holding company for Farmington Bank (the "Bank"), reported net income of $3.4 million or $0.20 per diluted share for the quarter ended December 31, 2012 compared to a net loss of $1.1 million or ($0.07) per diluted share for the quarter ended September 30, 2012. For the year ended December 31, 2012, net income was $4.2 million or $0.25 per diluted share compared to a net loss of $4.0 million or ($0.29) per diluted share for the year ended December 31, 2011.

"We are pleased with our results for the quarter and year end, which are beginning to reflect the significant strategic investments made in our company over the past several years. Demonstrated organic loan and deposit growth in the markets we operate, will continue to build franchise and shareholder value," stated John J. Patrick, Jr., First Connecticut Bancorp's Chairman, President & CEO.

"We opened two new branches during 2012, increasing our geographical footprint and opened our 20th branch location in Newington CT on February 26, 2013 as we continue to strategically expand within our market," added Patrick.

Financial Highlights

  • Net interest income remained strong increasing $705,000 or 5% to $14.1 million for the quarter ended December 31, 2012 and $5.0 million or 10% to $53.2 million for the year ended December 31, 2012, despite a faster than anticipated decline in our resort loans as we continue our planned exit of the resort financing market.
  • Strong organic loan growth continued as total loans increased $34.1 million or 2% to $1.5 billion during the quarter ended December 31, 2012 and increased $223.9 million or 17% for the year ended December 31, 2012. This growth was achieved despite resort loans decreasing $18.5 million or 37% to $31.2 million for the quarter ended December 31, 2012 and decreasing $44.1 million or 59% for the year ended December 31, 2012.
  • Overall deposits increased $72.5 million or 6% to $1.3 billion during the quarter ended December 31, 2012 and increased $153.8 million or 13% for the year ended December 31, 2012.
  • Checking accounts grew by 4% or 1,258 net new accounts for the quarter ended December 31, 2012 and 17% or 5,066 net new accounts for the year ended December 31, 2012.
  • Continued expansion of the secondary market residential lending program led to an increase in the net gain on loans sold of $1.3 million or 182% to $1.9 million for the quarter ended December 31, 2012 compared to $687,000 for the quarter ended September 30, 2012. The net gain on loans sold increased $2.5 million or 370% to $3.2 million for the year ended December 31, 2012 compared to $671,000 for the year ended December 31, 2011.
  • Asset quality remains strong as loan delinquencies 30 days and greater decreased $751,000 at December 31, 2012 to $17.1 million compared to $17.8 million at September 30, 2012. Non-performing loans totaled $13.8 million or 0.90% of total loans at December 31, 2012 compared to $13.2 million or 0.88% of total loans at September 30, 2012. Net charge-offs totaled $1.7 million or 0.12% of average loans outstanding for the year ended December 31, 2012 as compared to net charge-offs of $7.3 million or 0.61% of average loans outstanding for the year ended December 31, 2011.
  • On December 27, 2012, the Company announced the freeze of its non-contributory defined benefit and other post-retirement plans effective February 28, 2013 limiting future growth in the Company's pension and other post-retirement liabilities. As a result, the Company recognized a $1.9 million reduction in pension and other post-retirement benefit expenses related to unrecognized prior service costs for the quarter ended December 31, 2012. For 2013, it is expected the net incremental decrease in pension and other post-retirement expenses will be approximately $606,000.
  • We paid a cash dividend of $0.03 per share on December 27, 2012. This marks the fifth consecutive quarter we have paid a dividend since First Connecticut Bancorp, Inc. became a public company on June 29, 2011.

Earnings Summary

Fourth quarter 2012 compared with third quarter 2012

For the quarter ended December 31, 2012, net income increased by $4.5 million to $3.4 million compared to a net loss of $1.1 million for the quarter ended September 30, 2012. The increase in net income primarily resulted from a decrease in noninterest expenses due to the initial vesting of the 2012 Stock Incentive Plan (the "Plan") awards granted during the quarter ended September 30, 2012 and the impact of the freeze of our non-contributory defined benefit and other post-retirement benefit plans. The increase also resulted from an increase in net interest income due to prepayment penalty fees and an increase in noninterest income as we continue to expand our secondary market residential lending program.

Net interest income for the quarter ended December 31, 2012 increased $705,000 to $14.1 million compared to $13.4 million for the quarter ended September 30, 2012, primarily as a result of a $761,000 increase in prepayment penalty fees received from commercial borrowers during the quarter ended December 31, 2012. The net interest margin increased 9 basis points to 3.37% for the quarter ended December 31, 2012 compared to 3.28% for the quarter ended September 30, 2012 and the yield on average interest-earning assets increased 9 basis points to 3.95% for the quarter ended December 31, 2012 from 3.86% for the quarter ended September 30, 2012. The cost of average interest-earning liabilities decreased 1 basis point to 0.76% for the quarter ended December 31, 2012, reflecting the low funding cost environment.

Provision for loan losses was $315,000 for the quarter ended December 31, 2012 compared to $215,000 for the quarter ended September 30, 2012. The increase in the provision was primarily due to growth in our residential and commercial loan portfolios. The provision recorded was based upon management's analysis of the adequacy of allowance for loan losses as of December 31, 2012.

Noninterest income increased $1.9 million or 89% to $4.1 million for the quarter ended December 31, 2012 compared to $2.1 million for the quarter ended September 30, 2012, primarily due to a $1.3 million increase in the gain on sale of fixed-rate residential mortgage loans due to an expansion in our secondary market residential lending program, an increase of $245,000 in bank-owned life insurance income and an increase of $320,000 in other noninterest income, primarily related to an increase in mortgage banking derivatives.

Noninterest expense decreased $3.9 million for the quarter ended December 31, 2012 to $13.0 million compared to $16.9 million for the quarter ended September 30, 2012 primarily due to decreases in employee benefits and other operating expenses. Salaries and employee benefits decreased $3.1 million to $7.1 million compared to $10.2 million for the quarter ended September 30, 2012. The decrease was due to a $1.9 million reduction in pension and other post-retirement benefits expense related to unrecognized prior service costs as a result of the freeze of our non-contributory defined benefit and other post-retirement benefit plans. The decrease was also due to $2.1 million incurred from the initial vesting of the Plan awards granted during the quarter ended September 30, 2012, offset by a $533,000 increase in compensation expense related to incentive compensation and additional staff to support our growth. Other operating expenses decreased $875,000 to $2.8 million compared to $3.7 million for the quarter ended September 30, 2012. The decrease was primarily due to directors' stock compensation expense totaling $228,000 related to the Plan for the quarter ended December 31, 2012 compared to $977,000 in directors' stock compensation expense incurred related to the Plan, of which $914,000 resulted from the initial vesting of the Plan awards and a $394,000 loss on the sale of non-strategic properties during the quarter ended September 30, 2012.

Income taxes increased $1.9 million resulting in a tax expense of $1.4 million for the quarter ended December 31, 2012 compared to a tax benefit of $519,000 for the quarter ended September 30, 2012.

Year ended 2012 compared with year ended 2011

For the year ended December 31, 2012, net income increased by $8.2 million to $4.2 million compared to a net loss of $4.0 million for the year ended December 31, 2011, which primarily resulted from a $5.2 million expense incurred, net of taxes, for a stock contribution made to the Farmington Bank Community Foundation, Inc. and an $851,000 expense incurred to complete the phase out the Phantom Stock Plan. The improved performance also resulted from increases in net interest income and noninterest income, and decreases in the provision for loan losses and noninterest expenses.

Net interest income increased $5.0 million or 10% to $53.2 million for the year ended December 31, 2012 compared to $48.2 million for the year ended December 31, 2011, driven by loan growth, an increase in prepayment penalty fees and lower funding costs. The net interest margin increased 12 basis points to 3.35% for the year ended December 31, 2012 compared to 3.23% for the year ended December 31, 2011. The yield on average interest-earning assets remained flat at 3.96% as a result of offsetting record low residential rates with an increase in our commercial lending and an increase in prepayment penalty fees. The average net loans receivable yield decreased 41 basis points to 4.35%, which was offset with an $846,000 increase in prepayment penalty fees and average loan balances increasing $216.0 million or 18% for the year ended December 31, 2012. The cost of average interest-earning liabilities decreased 11 basis points to 0.80% for the year ended December 31, 2012 reflecting lower funding costs.

Provision for loan losses was $1.4 million for the year ended December 31, 2012 compared to $4.1 million for the year ended December 31, 2011. The decrease in the provision resulted from reserving approximately $3.2 million in the fourth quarter of 2011 due to deterioration in commercial real estate loans originated prior to 2008. The provision recorded was based upon management's analysis of the allowance for loan losses as of December 31, 2012.

Noninterest income increased $3.8 million or 67% to $9.5 million for the year ended December 31, 2012 compared to $5.7 million for the year ended December 31, 2011. Gain on sale of fixed-rate residential mortgage loans increased $2.5 million or 370% to $3.2 million compared to $671,000 for the year ended December 31, 2011 due to an expansion in our secondary market residential lending program. Bank-owned life insurance income increased $812,000 reflecting the purchase of additional insurance within the past twelve months. Fees for customer services increased $359,000 or 11% and other income increased $306,000 primarily due to an increase in the mortgage banking derivatives.

Noninterest expense decreased $620,000 or 1% to $55.7 million for the year ended December 31, 2012 compared to $56.3 million for the year ended December 31, 2011. Salaries and employee benefits increased $3.8 million to $32.4 million compared to $28.6 million for the year ended December 31, 2011. Excluding the $1.9 million reduction in pension and other post-retirement benefits expense due to the freeze of our non-contributory defined benefit and other post-retirement benefit plans and the $851,000 incurred to phase out the Phantom Stock Plan for the year ended December 31, 2011, salaries and employee benefits increased $6.5 million for the year ended December 31, 2012. The increase was due to supporting our de novo branch growth, providing the resources to sustain our strategic growth and $2.8 million of employees' stock compensation expense incurred related to the Plan. Other operating expenses increased $2.4 million to $10.7 million compared to $8.3 million for the year ended December 31, 2011. The increase was primarily due to directors' stock compensation expense totaling $1.2 million related to the Plan implemented in the current year, a $394,000 loss on the sale of non-strategic properties and a $430,000 increase in office expense to support our growth.

Income taxes increased $3.9 million resulting in a tax expense of $1.5 million for the year ended December 31, 2012 compared to a tax benefit of $2.5 million for the year ended December 31, 2011 primarily due to the tax treatment for the $6.9 million funding of the Farmington Bank Community Foundation, Inc. in the prior year.

Balance Sheet Activity

Total assets increased $66.8 million or 4% at December 31, 2012 to $1.8 billion compared to September 30, 2012 reflecting an increase in loans and cash and cash equivalents.

Net loans increased $34.9 million at December 31, 2012 to $1.5 billion compared to September 30, 2012 due to our continued focus on commercial and residential lending which, combined, increased $53.4 million offset by an $18.5 million decrease in resort loans due to a strategic decision in 2010 to gradually exit the resort financing market. Loan portfolios grew as follows: Commercial Real Estate, $25.1 million or 6%; Construction Real Estate, $9.4 million or 17%; Residential Real Estate, $15.2 million or 3% and Home Equity Lines of Credit, $8.2 million or 6%.

Deposits increased $72.5 million at December 31, 2012 compared to September 30, 2012, primarily due to continued growth in de novo branches, a $15.0 million increase in non-interest bearing deposits due to individual and commercial account growth and a $17.5 million increase in municipal deposits. We opened our 19th branch in South Windsor, Connecticut in November 2012.

Asset Quality

The allowance for loan losses decreased $691,000 to $17.2 million at December 31, 2012 compared to $17.9 million at September 30, 2012. Impaired loans decreased 3% to $36.9 million as of December 31, 2012 from $37.9 million as of September 30, 2012. Non-performing loans increased $542,000 to $13.8 million at December 31, 2012 from $13.2 million at September 30, 2012 and remained stable at 0.90% of total loans. At December 31, 2012, the allowance for loan losses represented 1.12% of total loans and 125.01% of non-performing loans, compared to 1.19% of total loans and 135.35% of non-performing loans at September 30, 2012. Net charge-offs for the quarter ended December 31, 2012 were $1.0 million or 0.27% (annualized), compared to net charge-offs for the quarter ended September 30, 2012 of $222,000 or 0.06% (annualized). Loan delinquencies 30 days and greater decreased $751,000 at December 31, 2012 to $17.1 million compared to $17.8 million at September 30, 2012.

Capital and Liquidity

The Company remained well-capitalized with an estimated total capital to risk-weighted asset ratio of 18.85% at December 31, 2012.

At December 31, 2012, the Company continued to have adequate liquidity including significant unused borrowing capacity at the Federal Home Loan Bank and the Federal Reserve Bank, as well as access to funding through brokered deposits.

About First Connecticut Bancorp, Inc.

First Connecticut Bancorp, Inc. (Nasdaq:FBNK) is a Maryland-chartered stock holding company, that wholly owns Farmington Bank. Farmington Bank is a full-service, community bank with 20 branch locations throughout central Connecticut. Established in 1851, Farmington Bank is a diversified consumer and commercial bank with an ongoing commitment to contribute to the betterment of the communities in our region. For more information regarding the Bank's products and services and for First Connecticut Bancorp, Inc. investor relations information, please visit www.farmingtonbankct.com.

The First Connecticut Bancorp, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=11128

Forward Looking Statements

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

Financial information contained in this release should be considered to be an estimate pending the filing with the Securities and Exchange Commission of the Company's Annual Report on Form 10-K for the year ended December 31, 2012. While the Company is not aware of any need to revise the results disclosed in this release, accounting literature may require adverse information received by management between the date of this release and the filing of the 10-K to be reflected in the results of the period, even though the new information was received by management subsequent to the date of this release.

First Connecticut Bancorp, Inc.
Selected Financial Data (Unaudited)
At or for the Three Months Ended
(Dollars in thousands, except per share data) December 31, 2012 September 30, 2012 June 30, 2012 March 31, 2012 December 31, 2011
Selected Financial Condition Data:
Total assets $ 1,822,946 $ 1,756,133 $1,687,431 $ 1,677,229 $ 1,617,650
Cash and cash equivalents 50,641 33,021 36,727 131,280 90,296
Held to maturity securities 3,006 3,007 3,007 3,216 3,216
Available for sale securities 138,481 125,854 130,386 115,956 135,170
Federal Home Loan Bank of Boston stock, at cost 8,939 8,056 7,137 7,137 7,449
Loans receivable, net 1,520,170 1,485,275 1,415,732 1,326,107 1,295,177
Deposits 1,330,455 1,257,987 1,218,743 1,249,583 1,176,682
Federal Home Loan Bank of Boston advances 128,000 125,200 91,000 63,000 63,000
Total stockholders' equity 241,522 242,199 248,105 250,196 251,980
Allowance for loan losses 17,229 17,920 17,927 17,727 17,533
Non-performing loans 13,782 13,240 13,478 16,338 15,501
Selected Operating Data:
Interest income $ 16,507 $ 15,780 $ 15,146 $ 15,427 $ 14,961
Interest expense 2,415 2,393 2,347 2,473 2,614
Net Interest Income 14,092 13,387 12,799 12,954 12,347
Provision for allowance for loan losses 315 215 520 330 3,190
Net interest income after provision for loan losses 13,777 13,172 12,279 12,624 9,157
Noninterest income 4,054 2,145 1,978 1,313 1,250
Noninterest expense 13,025 16,905 13,133 12,629 12,779
Income (loss) before income taxes 4,806 (1,588) 1,124 1,308 (2,372)
Provision (benefit) for income taxes 1,381 (519) 293 317 (918)
Net income (loss) $ 3,425 $ (1,069) $ 831 $ 991 $ (1,454)
Performance Ratios (annualized):
Return on average assets 0.77% -0.25% 0.20% 0.24% -0.35%
Return average equity 5.62% -1.74% 1.32% 1.57% -2.24%
Interest rate spread (1) 3.19% 3.09% 3.12% 3.20% 2.93%
Net interest rate margin (2) 3.37% 3.28% 3.32% 3.41% 3.15%
Non-interest expense to average assets 2.92% 3.89% 3.16% 3.08% 3.08%
Efficiency ratio (3) 71.78% 108.84% 88.87% 88.52% 93.98%
Average interest-earning assets to average interest-bearing liabilities 131.82% 131.77% 132.88% 132.04% 132.19%
Asset Quality Ratios:
Allowance for loan losses as a percent of total loans 1.12% 1.19% 1.25% 1.32% 1.34%
Allowance for loan losses as a percent of non-performing loans 125.01% 135.35% 133.01% 108.50% 113.11%
Net charge-offs to average loans (annualized) 0.27% 0.06% 0.09% 0.04% 0.56%
Non-performing loans as a percent of total loans 0.90% 0.88% 0.94% 1.22% 1.18%
Non-performing loans as a percent of total assets 0.76% 0.75% 0.80% 0.97% 0.96%
Per Share Related Data:
Basic earnings (loss) per share $ 0.20 $ (0.07) $ 0.05 $ 0.06 $ (0.09)
Diluted earnings (loss) per share $ 0.20 $ (0.07) $ 0.05 $ 0.06 $ (0.09)
Dividends declared per share $ 0.03 $ 0.03 $ 0.03 $ 0.03 $ 0.03
Capital Ratios:
Equity to total assets at end of period 13.25% 13.79% 14.70% 14.92% 15.58%
Average equity to average assets 13.68% 14.19% 15.09% 15.36% 15.65%
Total capital to risk-weighted assets 18.85% 19.15% 20.43% 21.84% 22.38%
Tier I capital to risk-weighted assets 17.60% 17.90% 19.18% 20.59% 21.13%
Tier I capital to total average assets 13.94% 14.24% 15.21% 15.58% 15.51%
Total equity to total average assets 13.56% 13.95% 14.90% 15.27% 15.20%
(1) Represents the difference between the weighted-average yield on average interest-earning assets and the weighted-average cost of the
interest-bearing liabilities.
(2) Represents net interest income as a percent of average interest-earning assets.
(3) Represents noninterest expense divided by the sum of net interest income and noninterest income.
First Connecticut Bancorp, Inc.
Consolidated Statements of Condition
December 31,
2012
September 30,
2012
December 31,
2011
(Dollars in thousands) (Unaudited) (Unaudited)
Assets
Cash and due from banks $ 50,641 $ 33,021 $ 40,296
Federal funds sold -- -- 50,000
Cash and cash equivalents 50,641 33,021 90,296
Securities held-to-maturity, at amortized cost 3,006 3,007 3,216
Securities available-for-sale, at fair value 138,481 125,854 135,170
Loans held for sale 9,626 4,569 1,039
Loans, net 1,520,170 1,485,275 1,295,177
Premises and equipment, net 19,967 19,231 21,379
Federal Home Loan Bank of Boston stock, at cost 8,939 8,056 7,449
Accrued income receivable 4,415 4,502 4,185
Bank-owned life insurance 37,449 37,348 30,382
Deferred income taxes 15,682 14,038 13,907
Prepaid expenses and other assets 14,570 21,232 15,450
Total assets $ 1,822,946 $ 1,756,133 $ 1,617,650
Liabilities and Stockholders' Equity
Deposits
Interest-bearing $ 1,082,869 $ 1,036,523 $ 981,057
Noninterest-bearing 247,586 221,464 195,625
1,330,455 1,257,987 1,176,682
Federal Home Loan Bank of Boston advances 128,000 125,200 63,000
Repurchase agreement borrowings 21,000 21,000 21,000
Repurchase liabilities 54,187 66,096 64,466
Accrued expenses and other liabilities 47,782 43,651 40,522
Total liabilities 1,581,424 1,513,934 1,365,670
Commitments and contingencies -- -- --
Stockholders' Equity
Common stock 181 181 179
Additional paid-in-capital 172,247 171,419 174,836
Unallocated common stock held by ESOP (14,806) (15,073) (10,490)
Treasury stock, at cost (4,860) (1,174) --
Retained earnings 95,145 92,076 92,937
Accumulated other comprehensive loss (6,385) (5,230) (5,482)
Total stockholders' equity 241,522 242,199 251,980
Total liabilities and stockholders' equity $ 1,822,946 $ 1,756,133 $ 1,617,650
First Connecticut Bancorp, Inc.
Consolidated Statements of Operations (Unaudited)
Three Months Ended For The Years Ended
Dec 31, Sept 30 Dec 31, Dec 31,
(Dollars in thousands, except per share data) 2012 2012 2011 2012 2011
Interest income
Interest and fees on loans
Mortgage $ 12,415 $ 11,460 $ 10,836 $ 45,867 $ 42,552
Other 3,770 3,927 3,652 15,445 14,331
Interest and dividends on investments
United States Government and agency obligations 190 234 269 939 1,373
Other bonds 61 87 51 266 191
Corporate stocks 66 69 69 275 275
Other interest income 5 3 84 68 303
Total interest income 16,507 15,780 14,961 62,860 59,025
Interest expense .
Deposits 1,649 1,644 1,873 6,691 7,665
Interest on borrowed funds 511 499 486 1,953 2,061
Interest on repo borrowings 187 179 181 727 721
Interest on repurchase liabilities 68 71 74 257 379
Total interest expense 2,415 2,393 2,614 9,628 10,826
Net interest income 14,092 13,387 12,347 53,232 48,199
Provision for allowance for loan losses 315 215 3,190 1,380 4,090
Net interest income after provision for loan losses 13,777 13,172 9,157 51,852 44,109
Noninterest income
Fees for customer services 1,048 950 856 3,714 3,355
Net gain on sale of investments -- -- -- -- 89
Net gain on loans sold 1,935 687 42 3,151 671
Brokerage and insurance fee income 32 34 25 123 189
Bank owned life insurance income 571 326 200 1,537 725
Other 468 148 127 965 659
Total noninterest income 4,054 2,145 1,250 9,490 5,688
Noninterest expense
Salaries and employee benefits 7,156 10,243 7,499 32,442 28,605
Occupancy expense 1,095 1,108 1,074 4,491 4,534
Furniture and equipment expense 1,050 1,120 1,044 4,381 4,047
FDIC assessment 342 255 340 1,170 1,466
Marketing 587 509 838 2,455 2,474
Contribution to Farmington Bank
Community Foundation, Inc. -- -- -- -- 6,877
Other operating expenses 2,795 3,670 1,984 10,753 8,309
Total noninterest expense 13,025 16,905 12,779 55,692 56,312
Income (loss) before income taxes 4,806 (1,588) (2,372) 5,650 (6,515)
Provision for (benefit from) income taxes 1,381 (519) (918) 1,472 (2,475)
Net income (loss) $ 3,425 $ (1,069) $ (1,454) $ 4,178 $ (4,040)
Earnings (loss) per share (1):
Basic and Diluted $ 0.20 $ (0.07) $ (0.09) $ 0.25 $ (0.29)
Weighted average shares outstanding:
Basic and Diluted 17,192,767 16,309,325 17,344,666 16,643,566 17,145,031
Pro forma net loss per share (2):
Basic and Diluted N/A N/A N/A N/A $ (0.23)
(1)= For the year ended December 31, 2011, net loss per share reflects earnings for the period from June 29, 2011, the date the Company completed a Plan of Conversion and Reorganization to December 31, 2011.
(2)= Pro forma net loss per share assumes the Company's shares are outstanding for all periods prior to the completion of the Plan of Conversion and Reorganization on June 29, 2011.
First Connecticut Bancorp, Inc.
Consolidated Average Balances, Yields and Rates (Unaudited)
Three Months Ended Three Months Ended Three Months Ended
December 31, 2012 September 30, 2012 December 31, 2011
Average Balance Interest and Dividends
Yield/Cost
Average Balance Interest and Dividends
Yield/Cost
Average Balance Interest and Dividends
Yield/Cost
(Dollars in thousands)
Interest-earning assets:
Loans, net $ 1,504,834 $ 16,185 4.28% $ 1,460,686 $ 15,387 4.18% $1,251,274 14,488 4.59%
Securities 139,636 308 0.88% 141,607 380 1.06% 149,503 389 1.03%
Federal Home Loan Bank of Boston stock 8,670 9 0.41% 7,671 10 0.52% 7,449 -- 0.00%
Federal funds and other earning assets 10,598 5 0.19% 10,317 3 0.12% 148,832 84 0.22%
Total interest-earning assets 1,663,738 16,507 3.95% 1,620,281 15,780 3.86% 1,557,058 14,961 3.81%
Noninterest-earning assets 118,033 115,860 100,189
Total assets $ 1,781,771 $ 1,736,141 $1,657,247
Interest-bearing liabilities:
NOW accounts $ 215,266 $ 117 0.22% $ 207,763 $ 100 0.19% $ 233,946 116 0.20%
Money market 299,408 487 0.65% 280,572 498 0.70% 233,650 510 0.87%
Savings accounts 178,959 99 0.22% 172,494 67 0.15% 155,990 129 0.33%
Certificates of deposit 358,047 946 1.05% 361,648 979 1.07% 398,210 1,118 1.11%
Total interest-bearing deposits 1,051,680 1,649 0.62% 1,022,477 1,644 0.64% 1,021,796 1,873 0.73%
Advances from the Federal Home Loan Bank 118,339 511 1.72% 112,850 499 1.75% 63,001 486 3.06%
Repurchase agreement borrowings 21,000 187 3.54% 21,000 179 3.38% 21,000 181 3.42%
Repurchase liabilities 71,115 68 0.38% 73,268 71 0.38% 72,112 74 0.41%
Total interest-bearing liabilities 1,262,134 2,415 0.76% 1,229,595 2,393 0.77% 1,177,909 2,614 0.88%
Noninterest-bearing deposits 232,286 216,205 187,008
Other noninterest-bearing liabilities 43,663 43,965 32,938
Total liabilities 1,538,083 1,489,765 1,397,855
Stockholders' equity 243,688 246,376 259,392
Total liabilities and stockholders' equity $ 1,781,771 $ 1,736,141 $1,657,247
Net interest income $ 14,092 $ 13,387 $ 12,347
Net interest rate spread (1) 3.19% 3.09% 2.93%
Net interest-earning assets (2) $ 401,604 $ 390,686 $ 379,149
Net interest margin (3) 3.37% 3.28% 3.15%
Average interest-earning assets to average interest-bearing liabilities 131.82% 131.77% 132.19%
(1) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(2) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(3) Net interest margin represents net interest income divided by average total interest-earning assets.
First Connecticut Bancorp, Inc.
Consolidated Average Balances, Yields and Rates (Unaudited)
For The Years Ended December 31,
2012 2011

Average Balance
Interest and
Dividends

Yield/Cost

Average Balance
Interest and
Dividends

Yield/Cost
(Dollars in thousands)
Interest-earning assets:
Loans, net $ 1,410,822 $ 61,312 4.35% $ 1,194,804 $ 56,883 4.76%
Securities 136,302 1,443 1.06% 152,213 1,823 1.20%
Federal Home Loan Bank of Boston stock 7,714 37 0.48% 7,449 16 0.21%
Federal funds and other earning assets 33,521 68 0.20% 135,973 303 0.22%
Total interest-earning assets 1,588,359 62,860 3.96% 1,490,439 59,025 3.96%
Noninterest-earning assets 117,209 86,446
Total assets $ 1,705,568 $ 1,576,885
Interest-bearing liabilities:
NOW accounts $ 208,161 $ 389 0.19% $ 252,381 $ 632 0.25%
Money market 278,179 2,017 0.73% 208,985 1,993 0.95%
Savings accounts 171,871 291 0.17% 149,598 334 0.22%
Certificates of deposit 367,380 3,994 1.09% 419,084 4,706 1.12%
Total interest-bearing deposits 1,025,591 6,691 0.65% 1,030,048 7,665 0.74%
Advances from the Federal Home Loan Bank 89,419 1,953 2.18% 66,314 2,061 3.11%
Repurchase agreement borrowings 21,000 727 3.46% 21,000 721 3.43%
Repurchase liabilities 66,436 257 0.39% 72,543 379 0.52%
Total interest-bearing liabilities 1,202,446 9,628 0.80% 1,189,905 10,826 0.91%
Noninterest-bearing deposits 213,697 176,459
Other noninterest-bearing liabilities 41,223 30,018
Total liabilities 1,457,366 1,396,382
Stockholders' equity 248,202 180,503
Total liabilities and stockholders' equity $ 1,705,568 $ 1,576,885
Net interest income $ 53,232 $ 48,199
Net interest rate spread (1) 3.16% 3.05%
Net interest-earning assets (2) $ 385,913 $ 300,534
Net interest margin (3) 3.35% 3.23%
Average interest-earning assets to average interest-bearing liabilities 132.09% 125.26%
(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.

CONTACT: Jennifer H. Daukas Investor Relations Officer One Farm Glen Boulevard, Farmington, CT 06032 P 860-284-6359 F 860-409-3316 jdaukas@farmingtonbankct.com

Source:First Connecticut Bancorp, Inc.