New Hampshire Thrift Bancshares, Inc. Announces Earnings for Fiscal Year 2012

NEWPORT, NH--(Marketwire - Feb 1, 2013) - New Hampshire Thrift Bancshares, Inc. (the "Company") (NASDAQ: NHTB), the holding company for Lake Sunapee Bank, fsb (the "Bank"), today reported consolidated net income for the twelve months ended December 31, 2012, of $7.8 million, or $1.20 per common share, assuming dilution, compared to $7.7 million, or $1.20 per common share, assuming dilution, for same period in 2011, an increase of $90 thousand, or 1.18%. For the quarter ended December 31, 2012, the Company reported consolidated net income of $1.6 million, or $0.26 per common share, assuming dilution, compared to $1.6 million, or $0.24 per common share, assuming dilution, for the quarter ended December 31, 2011, an increase of $5 thousand, or 0.31%.

2012 Financial Highlights

• Total assets increased $228.7 million, or 21.95%, to $1.3 billion at December 31, 2012, from $1.0 billion at December 31, 2011.
  
  
• Net loans increased $187.3 million, or 26.20%, to $902.2 million at December 31, 2012, from $715.0 million at December 31, 2011.
  
  
• In 2012, the Company originated $426.8 million in loans, compared to $289.1 million in 2011.
  
  
• The Company's loan servicing portfolio was $385.4 million at December 31, 2012, compared to $365.8 million at December 31, 2011.
  
  
• Total deposits increased $146.3 million, or 18.22%, to $949.3 million at December 31, 2012, from $803.0 million at December 31, 2011.
  
  
• Net interest and dividend income for the year ended December 31, 2012, was $29.0 million compared to $28.5 million for the same period in 2011.
  
  
• Net income available to common stockholders was $7.1 million for the year ended December 31, 2012, compared to $7.0 million for the same period in 2011
  
  
• The Company's returns on average assets and average equity for the twelve months ended December 31, 2012, were 0.84% and 7.51%, respectively, compared to 0.74% and 7.96%, respectively, for the same period in 2011.
  
  
• As a percentage of total loans, non-performing loans decreased to 1.59% at December 31, 2012, from 2.32% at December 31, 2011.
  
  

Earnings Summary

Net income of $7.8 million for the twelve months ended December 31, 2012, includes an increase of $523 thousand, or 1.84%, in net interest and dividend income. The provision for loan losses increased $1.3 million, or 100.22%, to $2.7 million for the twelve months ended December 31, 2012, compared to $1.4 million for the same period in 2011. Noninterest income increased $4.2 million, or 39.69%, to $14.6 million for the twelve months ended December 31, 2012, compared to $10.5 million for the same period in 2011. This increase includes a net loss on sales of other real estate owned of $150 thousand and decreases of $4 thousand in customer service fees and $129 thousand in realized gain in Charter Holding Corp partially offset by increases of $1.2 million in net gains on sales and calls of securities, $1.9 million in net gains on the sales of loans, $1.2 million in insurance commission income and $79 thousand in bank-owned life insurance income. Noninterest expense increased $2.4 million, or 8.69%, to $29.5 million for the twelve months ended December 31, 2012, compared to $27.1 million for the same period in 2011. Within noninterest expense, salaries and employee benefits increased $682 thousand, or 4.78%, to $15.0 million for the twelve months ended December 31, 2012, compared to $14.3 million for the same period in 2011. The Company recorded approximately $1.2 million of expenses related to the fourth quarter acquisition of The Nashua Bank.

Net income of $1.6 million for the quarter ended December 31, 2012, includes an increase of $325 thousand, or 4.64%, in net interest and dividend income compared to the same period in 2011. The provision for loan losses increased $77 thousand to $444 thousand for the quarter ended December 31, 2012, compared to $367 thousand for the same period in 2011. Noninterest income increased $1.3 million, or 51.23%, to $3.8 million for the quarter ended December 31, 2012, compared to $2.5 million for the same period in 2011. This increase includes increases of $20 thousand in customer service fees, $56 thousand in net gains on sales and calls of securities, $965 thousand in net gain on sales of loans, $13 thousand in rental income, $32 thousand in realized gain in Charter Holding Corp., $146 thousand in insurance commission income, and $19 thousand in bank-owned life insurance income. Noninterest expense increased $853 thousand, or 12.04%, to $7.9 million for the quarter ended December 31, 2012, compared to $7.1 million for the same period in 2011, including approximately $1.0 million of expenses related to the acquisition of The Nashua Bank.

Balance Sheet Summary

Total assets were $1.3 billion at December 31, 2012, compared to $1.0 billion at December 31, 2011, an increase of 21.95%. Securities available-for-sale increased $2.1 million to $212.4 million at December 31, 2012, from $210.3 million at December 31, 2011. Net loans held in portfolio increased $187.3 million, or 26.20%, to $902.2 million at December 31, 2012, from $715.0 million at December 31, 2011. This increase in loans includes approximately $91.5 million of loans from the acquisition of The Nashua Bank. The allowance for loan losses was $9.9 million at December 31, 2012, compared to $9.1 million at December 31, 2011. The change in the allowance for loan losses is the net effect of provisions of $2.7 million, charge-offs of $2.5 million, and recoveries of $596 thousand. As a percentage of total loans, non-performing loans decreased from 2.32% at December 31, 2011 to 1.59% at December 31, 2012. Total loan production for the twelve months ended December 31, 2012, was $426.8 million compared to $289.1 million for the twelve months ended December 31, 2011. Loan production during the fourth quarter of 2012 was $103.5 million compared to $93.2 million for the same period in 2011.

Total deposits increased $146.3 million, or 18.22%, to $949.3 million at December 31, 2012, from $803.0 million at December 31, 2011. This increase in deposits includes approximately $94.4 million of deposits from the acquisition of The Nashua Bank. Within deposits, savings and money market accounts increased $87.2 million, transaction accounts increased $41.7 million and time deposits increased $17.4 million. Advances from the Federal Home Loan Bank increased $61.8 million, or 76.32%, to $142.7 million at December 31, 2012, from $81.0 million at December 31, 2011.

Stockholders' equity of $129.5 million resulted in a book value of $15.09 per common share at December 31, 2012, based on 7,055,946 shares of common stock outstanding. The Bank remains well-capitalized with a Leverage (Tier I) Capital ratio of 8.87% at December 31, 2012.

Other Events

On December 21, 2012, the Company announced it had completed its acquisition of The Nashua Bank in Nashua, New Hampshire, expanding the Company's presence in southern New Hampshire. The Company issued approximately 1.15 million shares of its common stock and paid approximately $3.68 million in cash to Nashua Bank shareholders in the transaction. The Nashua Bank now operates under the name "The Nashua Bank, a division of Lake Sunapee Bank, fsb."

About New Hampshire Thrift Bancshares, Inc.

New Hampshire Thrift Bancshares, Inc. is the bank holding company of Lake Sunapee Bank, fsb, a federally chartered stock savings bank which provides a wide range of banking and financial services including McCrillis & Eldredge Insurance, Inc., a full-line independent insurance agency which offers a complete range of commercial insurance services and consumer products. These wholly owned subsidiaries operate through 30 banking and insurance offices strategically located within the greater Dartmouth-Lake Sunapee-Kearsarge and Monadnock regions of west-central New Hampshire and central Vermont. New Hampshire Thrift Bancshares, Inc. has total assets of approximately $1.3 billion.

Forward-Looking Statements

The Company wishes to caution readers not to place undue reliance on any such forward-looking statements contained in this press release, which speak only as of the date made. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors discussed under the caption "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2011, and in subsequent filings with the Securities and Exchange Commission. In addition, the forward-looking statements included in this press release represent our views as of the date of this release. The Company and the Bank do not undertake and specifically decline any obligation to publicly release the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

New Hampshire Thrift Bancshares, Inc.
Selected Financial Highlights
For the Years Ended December 31,			2012				2011
(Dollars in thousands except for per share data)
Net Income			$	7,759			$	7,669
Per Share Data:
	Basic Earnings			1.20				1.20
	Diluted Earnings (1)			1.20				1.20
	Dividends Paid			0.52				0.52
	Dividend Payout Ratio			43.33	%			43.33	%
Return on Average Assets				0.84	%			0.74	%
Return on Average Equity				7.51	%			7.96	%
As of December 31,			2012				2011
(Dollars in thousands except for per share data)
Total Assets			$	1,270,477			$	1,041,819
Total Securities (2)				221,875				217,933
Loans, Net				902,236				714,952
Total Deposits				949,341				803,023
Federal Home Loan Bank Advances				142,730				80,967
Stockholders' Equity				129,494				108,660
Book Value per Common Share			$	15.09			$	15.20
Common Shares Outstanding				7,055,946				5,832,360
Leverage (Tier I) Capital				8.87	%			9.75	%
Number of Locations				30				30

(1)		Diluted earnings per share are calculated using the weighted-average number of shares outstanding for the period, including common stock equivalents, as appropriate.
(2)		Includes available-for-sale securities shown at fair value and Federal Home Loan Bank stock at cost.

New Hampshire Thrift Bancshares, Inc.
Consolidated Balance Sheets
As of December 31,
(Dollars in thousands)					2012				2011
ASSETS					(unaudited)
	Cash and due from banks				$	26,147			$	21,841
	Overnight deposits					13,265				2,899
			Total cash and cash equivalents			39,412				24,740
	Securities available-for-sale					212,369				210,318
	Federal Home Loan Bank stock					9,506				7,615
	Loans held-for-sale					11,983				3,434
	Loans receivable, net of the allowance for loan losses of $9.9 million as of December 31, 2012, and $9.1 million as of December 31, 2011					902,236				714,952
	Accrued interest receivable					2,845				2,669
	Bank premises and equipment, net					17,261				16,450
	Investments in real estate					4,074				3,451
	Other real estate owned					102				1,344
	Goodwill					35,395				28,597
	Intangible assets					3,416				1,755
	Investment in partially owned Charter Holding Corp., at equity					4,909				4,895
	Bank-owned life insurance					18,905				13,347
	Other assets					8,064				8,252
		Total assets			$	1,270,477			$	1,041,819
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
	Deposits:
	Noninterest-bearing				$	74,133			$	64,356
	Interest-bearing					875,208				738,667
	Total deposits					949,341				803,023
	Federal Home Loan Bank advances					142,730				80,967
	Other borrowings					-				543
	Securities sold under agreements to repurchase					14,619				15,514
	Subordinated debentures					20,620				20,620
	Accrued expenses and other liabilities					13,673				12,492
		Total liabilities				1,140,983				933,159
STOCKHOLDERS' EQUITY
	Preferred stock, $.01 par value per share: 2,500,000 shares authorized:
			Series B, fixed rate noncumulative perpetual, fixed rate cumulative perpetual, 23,000 shares issued and outstanding at December 31, 2012, and 20,000 shares issued and outstanding at December 31, 2011			-				-
	Common stock, $.01 par value, per share: 10,000,000 shares authorized, 7,486,225 shares issued and 7,055,946 shares outstanding as of December 31, 2012, and 6,292,639 shares issued and 5,832,360 shares outstanding as of December 31, 2011					75				63
	Warrants					-				85
	Paid-in capital					83,977				66,658
	Retained earnings					53,933				49,892
	Accumulated other comprehensive loss					(1,444	)			(887	)
	Unearned stock awards					(377	)			-
	Treasury stock, at cost, 430,279 shares as of December 31, 2012, and 460,279 shares as of December 31, 2011					(6,670	)			(7,151	)
		Total stockholders' equity				129,494				108,660
		Total liabilities and stockholders' equity			$	1,270,477			$	1,041,819

New Hampshire Thrift Bancshares, Inc.
Consolidated Statements of Income
			For the Twelve Months Ended December 31,							Three Months Ended December 31,
(Dollars in thousands except for per share data)			2012				2011			2012			2011
INTEREST AND DIVIDEND INCOME			(unaudited)							(unaudited)
	Interest and fees on loans		$	32,542			$	31,640		$	8,489		$	7,844
	Interest and dividends on debt investments
	Taxable			3,223				4,601			466			989
	Dividends			62				35			15			6
	Other			594				912			135			232
	Total interest and dividend income			36,421				37,188			9,105			9,071
INTEREST EXPENSE
	Interest on deposits			4,381				5,771			1,026			1,360
	Interest on advances and other borrowed money			1,944				1,863			495			450
	Interest expense on debentures			1,027				1,008			252			256
	Interest on securities sold under agreements to repurchase			47				47			12			9
	Total interest expense			7,399				8,689			1,785			2,075
	Net interest and dividend income			29,022				28,499			7,320			6,996
PROVISION FOR LOAN LOSSES				2,705				1,351			444			367
	Net interest and dividend income after provision for loan losses			26,317				27,148			6,876			6,629
OTHER INCOME
	Customer service fees			5,068				5,071			1,300			1,258
	Net gain on sales and calls of securities			3,819				2,588			404			348
	Net gain on sales of loans			2,867				931			1,333			368
	Net (loss) gain on sales of other real estate owned and fixed assets			(150	)			27			-			-
	Rental income			736				714			176			163
	Realized gain in Charter Holding Corp.			444				573			146			114
	Insurance commission income			1,315				122			267			120
	Bank owned life insurance income			511				432			137			118
	Total noninterest income			14,609				10,458			3,763			2,489

		For the Twelve Months Ended December 31,							Three Months Ended December 31,
(Dollars in thousands except for per share data)		2012			2011				2012				2011
NONINTEREST EXPENSES		(unaudited)							(unaudited)
Salaries and employee benefits			14,988			14,307				3,836				3,781
Occupancy and equipment expenses			3,648			3,806				937				957
Advertising and promotion			481			510				131				141
Depositors' insurance			802			793				198				184
Professional services			1,208			1,122				289				315
Data processing and outside services			1,117			1,048				268				285
Telephone			664			799				153				294
ATM processing fees			498			481				130				118
Mortgage servicing (income), net of amortization of mortgage servicing rights			92			(117	)			(4	)			11
Supplies			373			344				94				93
Other expenses			5,612			4,034				1,905				905
Total noninterest expenses			29,483			27,126				7,937				7,084
INCOME BEFORE PROVISION FOR INCOME TAXES			11,443			10,480				2,703				2,034
PROVISION FOR INCOME TAXES			3,684			2,811				1,068				404
NET INCOME		$	7,759		$	7,669			$	1,635			$	1,630
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS		$	7,093		$	6,956			$	1,584			$	1,393
Earnings Per Common Share, basic		$	1.20		$	1.20			$	0.26			$	0.24
Earnings Per Common Share, assuming dilution (1)		$	1.20		$	1.20			$	0.26			$	0.24
Dividends Declared per common share		$	0.52		$	0.52			$	0.13			$	0.13

(1)

Diluted earnings per share are calculated using the weighted-average number of shares outstanding for the period, including common stock equivalents, as appropriate.