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Cambridge Bancorp Reports First Quarter Results

Monday, April 23, 2012

CAMBRIDGE, Mass. - Cambridge Bancorp (OTC BB: CATC) today reported unaudited net income of $3,285,000 for the first quarter of 2012, or $0.85 per diluted share, compared to $3,105,000, or $0.82 per diluted share, for the same quarter in 2011. The quarter-over-quarter earnings increase of $180,000 (5.8%) was attributable to a combination of solid growth in net interest income and a modest increase in wealth management income.

"I am pleased to report an increase in the Bank's quarter-over-quarter performance," noted Joseph V. Roller II, president and CEO. "We remain focused on delivering value for our customers."

"Net interest income provided a nice lift to first quarter earnings," said Roller. Total net interest income of $11.5 million for the first quarter of 2012 was $974,000 (9.2%) higher than the same period in 2011. The Bank continued to grow Wealth Management income, which increased $83,000 (2.5%) between the comparable periods, from new account growth and market appreciation. Assets under management grew to $1.7 billion at the end of the first quarter 2012 from $1.5 billion at year-end 2011.

"The Bank sustained the trend of growth in both loans and deposits during the first quarter of 2012. This positive performance however should be viewed in the context of persistent pressure on our net interest margin," added Roller.

Total loans outstanding increased by $18.1 million (2.7%) to $691.4 million since year-end 2011 and by $84.7 million (14.0%) over March 31, 2011. The loan growth in the first quarter of 2012 was primarily attributable to an increase in commercial mortgages of $12.5 million (5.4%) and to a lesser extent, residential mortgages of $5.2 million (1.6%).

Non-performing loans as a percentage of total loans stood at 0.17% at March 31, 2012, basically unchanged compared to 0.18% at December 31, 2011. Loan quality remains sound and the Allowance for Loan Losses stood at $10.5 million or 1.51% of total loans outstanding at March 31, 2012. At December 31, 2011, the Allowance for Loan Losses was $10.2 million or 1.51% of total loans outstanding. In response to continued loan growth, the provision for loan losses was $300,000 for the current quarter.

Total deposits increased by $31.2 million (2.8%) since year-end 2011 and by $147.2 million (14.6%) over March 31, 2011.

The Bank's net interest margin was 3.72% for the three months ended March 31, 2012 compared to 3.89% for the first quarter of 2011. The net interest margin decrease of 17 basis points for the comparable periods reflects the continued low interest rate environment.

Noninterest expense in the first quarter of 2012 totaled $11.3 million, an increase of $849,000 (8.2%) over the first quarter of 2011. Salaries and employee benefits, and occupancy and equipment increases were partially offset by lower FDIC insurance costs for the comparable periods.

Cambridge Bancorp and its subsidiary, Cambridge Trust Company, are based in Cambridge, Massachusetts, in the heart of Harvard Square. Cambridge Trust Company is a 122-year-old Massachusetts chartered commercial bank with $1.3 billion in total assets and 11 Massachusetts locations in Cambridge, Beacon Hill, Belmont, Concord, Lexington, Lincoln, and Weston. Cambridge Trust Company is one of New England's leaders in wealth management with $1.7 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 Portsmouth.

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 2011 Annual Report, which is posted in the investor relations section of our website at www.cambridgetrust.com/annualreport. We will also post supplemental financial information for first quarter of 2012 at the same site later this month. Interim results are not necessarily reflective of the results for the entire year.

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