x
|
Annual
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
|
Federal
|
83-0395247
|
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification Number)
|
95
Elm Street, West Springfield, Massachusetts
|
01089
|
|
(Address
of Principal Executive Offices)
|
Zip
Code
|
Common
Stock, par value $0.01 per share
|
NASDAQ
Global Select Market
|
(Title
of Class)
|
Name
of exchange on which registered
|
Large
accelerated filer o
|
Accelerated
filer x
|
Non-accelerated
filer o
|
ITEM
1.
|
BUSINESS
|
At
December 31,
|
|||||||||||||||||||||||||||||||
2006
|
2005
|
2004
|
2003
|
2002
|
|||||||||||||||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
||||||||||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||||||||||||||
Types
of loans:
|
|
|
|
|
|||||||||||||||||||||||||||
Real
estate loans:
|
|||||||||||||||||||||||||||||||
One-to
four-family
|
$
|
319,108
|
41.87
|
%
|
$
|
285,236
|
44.86
|
%
|
$
|
256,134
|
44.62
|
%
|
$
|
233,131
|
46.50
|
%
|
$
|
208,911
|
44.69
|
%
|
|||||||||||
Commercial
|
175,564
|
23.04
|
%
|
150,099
|
23.61
|
%
|
137,787
|
24.00
|
%
|
117,766
|
23.49
|
%
|
113,674
|
24.32
|
%
|
||||||||||||||||
Construction
|
54,759
|
7.19
|
%
|
28,872
|
4.54
|
%
|
29,836
|
5.20
|
%
|
26,625
|
5.31
|
%
|
18,091
|
3.87
|
%
|
||||||||||||||||
Home
equity
|
112,739
|
14.79
|
%
|
86,045
|
13.53
|
%
|
74,700
|
13.01
|
%
|
63,824
|
12.73
|
%
|
64,289
|
13.75
|
%
|
||||||||||||||||
Commercial
and industrial
|
69,762
|
9.15
|
%
|
59,591
|
9.37
|
%
|
56,291
|
9.81
|
%
|
37,863
|
7.55
|
%
|
34,344
|
7.35
|
%
|
||||||||||||||||
Automobile
|
24,456
|
3.21
|
%
|
22,054
|
3.47
|
%
|
17,460
|
3.04
|
%
|
20,943
|
4.18
|
%
|
27,001
|
5.78
|
%
|
||||||||||||||||
Other
consumer
|
5,725
|
0.75
|
%
|
3,895
|
0.61
|
%
|
1,862
|
0.32
|
%
|
1,169
|
0.23
|
%
|
1,194
|
0.26
|
%
|
||||||||||||||||
Total
loans receivable
|
$
|
762,113
|
100.00
|
%
|
$
|
635,792
|
100.00
|
%
|
$
|
574,070
|
100.00
|
%
|
$
|
501,321
|
100.00
|
%
|
$
|
467,504
|
100.00
|
%
|
|||||||||||
Other
items:
|
|||||||||||||||||||||||||||||||
Net
deferred loan costs and fees
|
1,285
|
1,148
|
923
|
852
|
802
|
||||||||||||||||||||||||||
Allowance
for loan losses
|
(7,218
|
)
|
(6,382
|
)
|
(5,750
|
)
|
(5,095
|
)
|
(4,924
|
)
|
|||||||||||||||||||||
Total
loans, net
|
$
|
756,180
|
$
|
630,558
|
$
|
569,243
|
$
|
497,078
|
$
|
463,382
|
Residential
(1)
|
Commercial
Real Estate
|
Construction
|
Commercial
and Industrial
|
Consumer
and Other
|
Total
|
||||||||||||||||||||||||||||||||
Weighted
|
Weighted
|
Weighted
|
Weighted
|
Weighted
|
Weighted
|
||||||||||||||||||||||||||||||||
Average
|
Average
|
Average
|
Average
|
Average
|
Average
|
||||||||||||||||||||||||||||||||
Amount
|
Rate
|
Amount
|
Rate
|
Amount
|
Rate
|
Amount
|
Rate
|
Amount
|
Rate
|
Amount
|
Rate
|
||||||||||||||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||||||||||||||||||||
Due
during the years ending December
31,
|
|||||||||||||||||||||||||||||||||||||
2007
|
$
|
21,018
|
5.71
|
%
|
$
|
7,879
|
6.38
|
%
|
$
|
21,117
|
8.56
|
%
|
$
|
35,783
|
8.00
|
%
|
$
|
8,826
|
5.44
|
%
|
$
|
94,623
|
7.24
|
%
|
|||||||||||||
2008
to 2011
|
82,246
|
5.81
|
%
|
32,645
|
6.38
|
%
|
10,382
|
6.75
|
%
|
23,414
|
6.26
|
%
|
18,540
|
4.99
|
%
|
167,227
|
5.95
|
%
|
|||||||||||||||||||
2012
and beyond
|
328,583
|
6.01
|
%
|
135,040
|
6.45
|
%
|
23,260
|
5.91
|
%
|
10,565
|
7.09
|
%
|
2,815
|
7.98
|
%
|
500,263
|
6.16
|
%
|
|||||||||||||||||||
Total
|
$
|
431,847
|
5.96
|
%
|
$
|
175,564
|
6.43
|
%
|
$
|
54,759
|
7.09
|
%
|
$
|
69,762
|
7.28
|
%
|
$
|
30,181
|
5.40
|
%
|
$
|
762,113
|
6.25
|
%
|
(1)
|
Includes
one- to four-family loans and home equity loans and lines of
credit.
|
Due
After December 31, 2007
|
||||||||||
Fixed
|
Adjustable
|
Total
|
||||||||
(In
thousands)
|
||||||||||
Residential
real estate (1)
|
$
|
341,716
|
$
|
69,113
|
$
|
410,829
|
||||
Commercial
real estate
|
62,910
|
104,775
|
167,685
|
|||||||
Construction
|
30,280
|
3,362
|
33,642
|
|||||||
Commercial
and industrial
|
28,520
|
5,459
|
33,979
|
|||||||
Consumer
and other
|
21,355
|
-
|
21,355
|
|||||||
Total
loans
|
$
|
484,781
|
$
|
182,709
|
$
|
667,490
|
(1)
|
Includes
one- to four-family loans and home equity loans and lines of
credit.
|
Years
Ended December 31,
|
||||||||||
2006
|
2005
|
2004
|
||||||||
(In
thousands)
|
||||||||||
Total
loans at beginning of period
|
$
|
635,792
|
$
|
574,070
|
$
|
501,321
|
||||
Loan
originations:
|
||||||||||
Residential
mortgages (1)
|
142,617
|
118,449
|
107,844
|
|||||||
Commercial
mortgage
|
51,141
|
37,185
|
55,553
|
|||||||
Construction
|
59,719
|
43,672
|
51,841
|
|||||||
Commercial
and industrial
|
85,105
|
73,006
|
67,087
|
|||||||
Automobile
|
13,702
|
15,166
|
8,606
|
|||||||
Other
consumer
|
4,712
|
2,621
|
1,314
|
|||||||
Total
loans originated
|
356,996
|
290,099
|
292,245
|
Sales
and loan principal repayment deductions:
|
||||||||||
Principal
repayments
|
232,266
|
229,513
|
214,713
|
|||||||
Loan
sales
|
190
|
170
|
5,218
|
|||||||
Decrease
(increase) due to other items
|
(1,781
|
)
|
(1,306
|
)
|
(435
|
)
|
||||
Total
deductions
|
230,675
|
228,377
|
219,496
|
|||||||
Net
loan activity
|
126,321
|
61,722
|
72,749
|
|||||||
Total
loans at end of period
|
$
|
762,113
|
$
|
635,792
|
$
|
574,070
|
(1)
|
Includes
one- to four-family loans and home equity loans and lines of
credit.
|
At
December 31,
|
||||||||||||||||
2006
|
2005
|
2004
|
2003
|
2002
|
||||||||||||
(Dollars
in thousands)
|
||||||||||||||||
Non-accrual
loans:
|
||||||||||||||||
Residential
mortgages (1)
|
$
|
20
|
$
|
1,016
|
$
|
1,383
|
$
|
772
|
$
|
132
|
||||||
Commercial
mortgages
|
1,144
|
141
|
1,376
|
455
|
363
|
|||||||||||
Construction
|
-
|
113
|
-
|
-
|
-
|
|||||||||||
Commercial
and industrial
|
123
|
447
|
1,025
|
599
|
475
|
|||||||||||
Automobile
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
Other
consumer
|
1
|
-
|
-
|
-
|
-
|
|||||||||||
Total
non-accrual loans
|
1,288
|
1,717
|
3,784
|
1,826
|
970
|
|||||||||||
Accruing
loans 90 days or more past due
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
Total
non-performing loans
|
1,288
|
1,717
|
3,784
|
1,826
|
970
|
|||||||||||
Other
real estate owned
|
562
|
1,602
|
0
|
39
|
66
|
|||||||||||
Total
non-performing assets
|
$
|
1,850
|
$
|
3,319
|
$
|
3,784
|
$
|
1,865
|
$
|
1,036
|
||||||
Ratios:
|
||||||||||||||||
Total
non-performing loans to total loans
|
0.17
|
%
|
0.27
|
%
|
0.66
|
%
|
0.36
|
%
|
0.21
|
%
|
||||||
Total
non-performing loans to total assets
|
0.13
|
%
|
0.19
|
%
|
0.49
|
%
|
0.25
|
%
|
0.16
|
%
|
(1) |
Includes
one- to four-family loans and home equity loans and lines of
credit.
|
Loans
Delinquent For
|
|||||||||||||||||||
60
- 89 Days
|
90
Days and Over
|
Total
|
|||||||||||||||||
Number
|
Amount
|
Number
|
Amount
|
Number
|
Amount
|
||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||
At
December 31, 2006
|
|||||||||||||||||||
Residential
mortgages (1)
|
19
|
$
|
1,354
|
1
|
$
|
20
|
20
|
$
|
1,374
|
||||||||||
Commercial
mortgage
|
6
|
524
|
7
|
1,144
|
13
|
1,668
|
|||||||||||||
Construction
|
1
|
108
|
-
|
-
|
1
|
108
|
|||||||||||||
Commercial
and industrial
|
6
|
93
|
4
|
123
|
10
|
216
|
|||||||||||||
Automobile
|
13
|
85
|
-
|
-
|
13
|
85
|
|||||||||||||
Other
consumer
|
-
|
-
|
1
|
1
|
1
|
1
|
|||||||||||||
Total
|
45
|
$
|
2,164
|
13
|
$
|
1,288
|
58
|
$
|
3,452
|
||||||||||
At
December 31, 2005
|
|||||||||||||||||||
Residential
mortgages (1)
|
9
|
$
|
855
|
6
|
$
|
1,016
|
15
|
$
|
1,871
|
||||||||||
Commercial
mortgage
|
4
|
546
|
2
|
141
|
6
|
687
|
|||||||||||||
Construction
|
-
|
-
|
1
|
113
|
1
|
113
|
|||||||||||||
Commercial
and industrial
|
1
|
2
|
6
|
447
|
7
|
449
|
|||||||||||||
Automobile
|
1
|
1
|
-
|
-
|
1
|
1
|
|||||||||||||
Other
consumer
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||
Total
|
15
|
$
|
1,404
|
15
|
$
|
1,717
|
30
|
$
|
3,121
|
||||||||||
At
December 31, 2004
|
|||||||||||||||||||
Residential
mortgages (1)
|
1
|
$
|
53
|
7
|
$
|
1,383
|
8
|
$
|
1,436
|
||||||||||
Commercial
mortgage
|
1
|
114
|
7
|
1,376
|
8
|
1,490
|
|||||||||||||
Construction
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||
Commercial
and industrial
|
9
|
330
|
10
|
1,025
|
19
|
1,355
|
|||||||||||||
Automobile
|
3
|
13
|
-
|
-
|
3
|
13
|
|||||||||||||
Other
consumer
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||
Total
|
14
|
$
|
510
|
24
|
$
|
3,784
|
38
|
$
|
4,294
|
||||||||||
At
December 31, 2003
|
|||||||||||||||||||
Residential
mortgages (1)
|
15
|
$
|
863
|
7
|
$
|
772
|
22
|
$
|
1,635
|
||||||||||
Commercial
mortgage
|
5
|
438
|
2
|
455
|
7
|
893
|
|||||||||||||
Construction
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||
Commercial
and industrial
|
11
|
132
|
9
|
599
|
20
|
731
|
|||||||||||||
Automobile
|
11
|
57
|
-
|
-
|
11
|
57
|
|||||||||||||
Other
consumer
|
4
|
4
|
-
|
-
|
4
|
4
|
|||||||||||||
Total
|
46
|
$
|
1,494
|
18
|
$
|
1,826
|
64
|
$
|
3,320
|
||||||||||
At
December 31, 2002
|
|||||||||||||||||||
Residential
mortgages (1)
|
26
|
$
|
1,001
|
4
|
$
|
132
|
30
|
$
|
1,133
|
||||||||||
Commercial
mortgage
|
8
|
1,112
|
3
|
363
|
11
|
1,475
|
|||||||||||||
Construction
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||
Commercial
and industrial
|
21
|
778
|
13
|
475
|
34
|
1,253
|
|||||||||||||
Automobile
|
38
|
201
|
-
|
-
|
38
|
201
|
|||||||||||||
Other
consumer
|
1
|
1
|
-
|
-
|
1
|
1
|
|||||||||||||
Total
|
94
|
$
|
3,093
|
20
|
$
|
970
|
114
|
$
|
4,063
|
(1)
|
Includes
one- to four-family loans and home equity loans and lines of
credit.
|
At
December 31,
|
At
December 31,
|
||||||
2006
|
2005
|
||||||
(In
thousands)
|
|||||||
|
|
||||||
Residential
Real Estate (1):
|
|
||||||
Substandard
assets
|
$
|
1,252
|
(2)
|
$
|
1,693
|
||
All
Other Loans:
|
|||||||
Special
mention assets
|
8,990
|
(3)
|
12,100
|
||||
Substandard
assets
|
10,449
|
8,189
|
|||||
Doubtful
assets
|
1,290
|
1,153
|
|||||
Loss
assets
|
-
|
-
|
|||||
Foreclosed
Assets:
|
|||||||
Other
real estate owned
|
562
|
1,602
|
|||||
Total
classified assets
|
$
|
21,981
|
$
|
23,135
|
(1)
|
Includes
one- to four-family loans and home equity loans and lines of
credit.
|
(2)
|
Includes
thirteen residential loans, five of which are in foreclosure or
liquidation proceedings.
|
(3)
|
Includes
eleven commercial lending
relationships.
|
At
or for the Year Ended December 31,
|
||||||||||||||||
2006
|
2005
|
2004
|
2003
|
2002
|
||||||||||||
(Dollars
in thousands)
|
||||||||||||||||
Balance
at beginning of period
|
$
|
6,382
|
$
|
5,750
|
$
|
5,094
|
$
|
4,923
|
$
|
4,700
|
||||||
Charge-offs:
|
||||||||||||||||
Residential
mortgages (1)
|
10
|
-
|
-
|
-
|
11
|
|||||||||||
Commercial
mortgage
|
-
|
60
|
-
|
-
|
46
|
|||||||||||
Construction
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
Commercial
and industrial
|
164
|
377
|
501
|
116
|
144
|
|||||||||||
Automobile
|
1
|
15
|
46
|
44
|
59
|
|||||||||||
Other
consumer
|
11
|
3
|
11
|
2
|
6
|
|||||||||||
Total
charge-offs
|
186
|
455
|
558
|
162
|
266
|
|||||||||||
Recoveries:
|
||||||||||||||||
Residential
mortgages (1)
|
-
|
-
|
-
|
-
|
1
|
|||||||||||
Commercial
mortgage
|
1
|
-
|
175
|
24
|
3
|
|||||||||||
Construction
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
Commercial
and industrial
|
47
|
157
|
32
|
5
|
54
|
|||||||||||
Automobile
|
2
|
6
|
21
|
-
|
15
|
|||||||||||
Other
consumer
|
3
|
7
|
3
|
10
|
18
|
|||||||||||
Total
recoveries
|
53
|
170
|
231
|
39
|
91
|
|||||||||||
Net
charge-offs
|
(133
|
)
|
(285
|
)
|
(327
|
)
|
(123
|
)
|
(175
|
)
|
||||||
Provision
for loan losses
|
969
|
917
|
983
|
294
|
398
|
|||||||||||
Balance
at end of period
|
$
|
7,218
|
$
|
6,382
|
$
|
5,750
|
$
|
5,094
|
$
|
4,923
|
||||||
Ratios:
|
||||||||||||||||
Net
charge-offs to average loans outstanding
|
0.02
|
%
|
0.05
|
%
|
0.06
|
%
|
0.03
|
%
|
0.04
|
%
|
||||||
Allowance
for loan losses to non-performing loans at end of period
|
560.40
|
%
|
371.69
|
%
|
151.96
|
%
|
278.97
|
%
|
507.53
|
%
|
||||||
Allowance
for loan losses to total loans at end of period
|
0.95
|
%
|
1.00
|
%
|
1.00
|
%
|
1.02
|
%
|
1.05
|
%
|
At
December 31,
|
|||||||||||||||||||
2006
|
2005
|
2004
|
|||||||||||||||||
Percent
of
|
Percent
of
|
Percent
of
|
|||||||||||||||||
Loans
in
|
Loans
in
|
Loans
in
|
|||||||||||||||||
Category
to
|
Category
to
|
Category
to
|
|||||||||||||||||
Amount
|
Total
Loans
|
Amount
|
Total
Loans
|
Amount
|
Total
Loans
|
||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||
At
end of period allocated to:
|
|||||||||||||||||||
Residential
mortgages (1)
|
$
|
1,469
|
56.66
|
%
|
$
|
554
|
58.40
|
%
|
$
|
526
|
57.63
|
%
|
|||||||
Commercial
mortgage
|
2,588
|
23.04
|
%
|
2,944
|
23.61
|
%
|
3,217
|
24.00
|
%
|
||||||||||
Construction
|
1,255
|
7.19
|
%
|
316
|
4.54
|
%
|
259
|
5.20
|
%
|
||||||||||
Commercial
and industrial
|
1,633
|
9.15
|
%
|
2,487
|
9.37
|
%
|
1,682
|
9.81
|
%
|
||||||||||
Automobile
|
220
|
3.21
|
%
|
78
|
3.47
|
%
|
60
|
3.04
|
%
|
||||||||||
Other
consumer
|
53
|
0.75
|
%
|
3
|
0.61
|
%
|
6
|
0.32
|
%
|
||||||||||
Total
allowance
|
$
|
7,218
|
100.00
|
%
|
$
|
6,382
|
100.00
|
%
|
$
|
5,750
|
100.00
|
%
|
At
December 31,
|
|||||||||||||
2003
|
2002
|
||||||||||||
Percent
of
|
Percent
of
|
||||||||||||
Loans
in
|
Loans
in
|
||||||||||||
Category
to
|
Category
to
|
||||||||||||
Amount
|
Total
Loans
|
Amount
|
Total
Loans
|
||||||||||
(Dollars
in thousands)
|
|||||||||||||
At
end of period allocated to:
|
|||||||||||||
Residential
mortgages (1)
|
$
|
974
|
59.23
|
%
|
$
|
1,466
|
58.44
|
%
|
|||||
Commercial
mortgage
|
2,304
|
23.49
|
%
|
2,134
|
24.32
|
%
|
|||||||
Construction
|
170
|
5.31
|
%
|
205
|
3.87
|
%
|
|||||||
Commercial
and industrial
|
1,483
|
7.55
|
%
|
835
|
7.35
|
%
|
|||||||
Automobile
|
155
|
4.18
|
%
|
272
|
5.78
|
%
|
|||||||
Other
consumer
|
8
|
0.23
|
%
|
11
|
0.26
|
%
|
|||||||
Total
allowance
|
$
|
5,094
|
100.00
|
%
|
$
|
4,923
|
100.00
|
%
|
(1)
|
Includes
one- to four-family loans and home equity loans and lines of
credit.
|
At
December 31,
|
|||||||||||||||||||
2006
|
2005
|
2004
|
|||||||||||||||||
Amortized
Cost
|
Fair
Value
|
Amortized
Cost
|
Fair
Value
|
Amortized
Cost
|
Fair
Value
|
||||||||||||||
(In
thousands)
|
|||||||||||||||||||
Investment
securities available-for-sale:
|
|||||||||||||||||||
Government-sponsored
enterprises
|
$
|
78,248
|
$
|
77,369
|
$
|
99,957
|
$
|
98,561
|
$
|
35,414
|
$
|
35,084
|
|||||||
Mortgage-backed
securities
|
111,481
|
109,274
|
117,259
|
114,702
|
102,209
|
101,679
|
|||||||||||||
Corporate
debt obligations
|
3,415
|
3,309
|
13,011
|
12,930
|
15,094
|
15,291
|
|||||||||||||
Equity
securities
|
293
|
285
|
294
|
272
|
294
|
275
|
|||||||||||||
Total
available-for-sale
|
$
|
193,437
|
$
|
190,237
|
$
|
230,521
|
$
|
226,465
|
$
|
153,011
|
$
|
152,329
|
|||||||
Investment
securities held-to-maturity:
|
|||||||||||||||||||
IRB
|
$
|
1,271
|
$
|
1,271
|
$
|
1,346
|
$
|
1,346
|
$
|
1,420
|
$
|
1,421
|
|||||||
Municipal
bonds
|
1,970
|
1,956
|
1,979
|
1,952
|
1,078
|
1,077
|
|||||||||||||
Total
held-to-maturity
|
$
|
3,241
|
$
|
3,227
|
$
|
3,325
|
$
|
3,298
|
$
|
2,498
|
$
|
2,498
|
More
than One Year
|
More
than Five Years
|
|||||||||||||||||||||||||||||||||
One
Year or Less
|
through
Five Years
|
through
Ten Years
|
More
than Ten Years
|
Total
Securities
|
||||||||||||||||||||||||||||||
Weighted
|
Weighted
|
Weighted
|
Weighted
|
Weighted
|
||||||||||||||||||||||||||||||
Amortized
|
Average
|
Amortized
|
Average
|
Amortized
|
Average
|
Amortized
|
Average
|
Amortized
|
Average
|
Fair
|
||||||||||||||||||||||||
Cost
|
Yield
|
Cost
|
Yield
|
Cost
|
Yield
|
Cost
|
Yield
|
Cost
|
Yield
|
Value
|
||||||||||||||||||||||||
(Dollars
in thousands)
|
||||||||||||||||||||||||||||||||||
Investment
securities available-for-sale:
|
||||||||||||||||||||||||||||||||||
Government-sponsored
enterprises
|
$
|
30,114
|
4.30
|
%
|
$
|
30,296
|
4.23
|
%
|
$
|
17,838
|
5.17
|
%
|
$
|
-
|
0.00
|
%
|
$
|
78,248
|
4.47
|
%
|
$
|
77,369
|
||||||||||||
Mortgage-backed
securities
|
114
|
4.01
|
%
|
26,915
|
3.73
|
%
|
16,622
|
4.22
|
%
|
67,830
|
4.61
|
%
|
111,481
|
4.34
|
%
|
109,274
|
||||||||||||||||||
Corporate
debt obligations
|
1,470
|
4.93
|
%
|
497
|
4.34
|
%
|
497
|
4.13
|
%
|
950
|
4.96
|
%
|
3,414
|
4.73
|
%
|
3,309
|
||||||||||||||||||
Total
available-for-sale
|
$
|
31,698
|
4.33
|
%
|
$
|
57,708
|
4.00
|
%
|
$
|
34,957
|
4.70
|
%
|
$
|
68,780
|
4.61
|
%
|
$
|
193,143
|
4.40
|
%
|
$
|
189,952
|
||||||||||||
Investment
securities held-to-maturity:
|
||||||||||||||||||||||||||||||||||
IRB
|
$
|
-
|
0.00
|
%
|
$
|
421
|
5.00
|
%
|
$
|
-
|
0.00
|
%
|
$
|
850
|
4.00
|
%
|
$
|
1,271
|
4.33
|
%
|
$
|
1,271
|
||||||||||||
Municipal
bonds
|
201
|
1.76
|
%
|
891
|
2.88
|
%
|
878
|
3.63
|
%
|
-
|
0.00
|
%
|
1,970
|
3.10
|
%
|
1,956
|
||||||||||||||||||
Total
held-to-maturity
|
$
|
201
|
1.76
|
%
|
$
|
1,312
|
3.56
|
%
|
$
|
878
|
3.63
|
%
|
$
|
850
|
4.00
|
%
|
$
|
3,241
|
3.58
|
%
|
$
|
3,227
|
At
December 31,
|
||||||||||||||||||||||||||||
2006
|
2005
|
2004
|
||||||||||||||||||||||||||
Weighted
|
Weighted
|
Weighted
|
||||||||||||||||||||||||||
Average
|
Average
|
Average
|
||||||||||||||||||||||||||
Balance
|
Percent
|
Rate
|
Balance
|
Percent
|
Rate
|
Balance
|
Percent
|
Rate
|
||||||||||||||||||||
(Dollars
in thousands)
|
||||||||||||||||||||||||||||
Deposit
type:
|
||||||||||||||||||||||||||||
Demand
|
$
|
97,190
|
14.17
|
%
|
0.00
|
%
|
$
|
93,301
|
14.27
|
%
|
0.00
|
%
|
$
|
86,246
|
14.05
|
%
|
0.00
|
%
|
||||||||||
NOW
|
37,523
|
5.47
|
%
|
0.57
|
%
|
39,922
|
6.11
|
%
|
0.25
|
%
|
39,917
|
6.50
|
%
|
0.25
|
%
|
|||||||||||||
Regular
savings
|
65,475
|
9.55
|
%
|
0.83
|
%
|
87,253
|
13.35
|
%
|
0.83
|
%
|
139,754
|
22.77
|
%
|
0.65
|
%
|
|||||||||||||
Money
market
|
164,463
|
23.99
|
%
|
3.20
|
%
|
154,177
|
23.59
|
%
|
2.93
|
%
|
94,586
|
15.41
|
%
|
1.48
|
%
|
|||||||||||||
Retirement
|
55,368
|
8.07
|
%
|
4.11
|
%
|
52,694
|
8.06
|
%
|
3.38
|
%
|
48,496
|
7.90
|
%
|
2.71
|
%
|
|||||||||||||
Certificates
of deposit
|
265,667
|
38.74
|
%
|
4.59
|
%
|
226,264
|
34.62
|
%
|
3.59
|
%
|
204,673
|
33.35
|
%
|
2.70
|
%
|
|||||||||||||
Total
deposits
|
$
|
685,686
|
100.00
|
%
|
2.99
|
%
|
$
|
653,611
|
100.00
|
%
|
2.54
|
%
|
$
|
613,672
|
100.00
|
%
|
1.51
|
%
|
At
December 31,
|
||||
2006
|
||||
(In
thousands)
|
||||
Three
months or less
|
$
|
34,924
|
||
Over
three months through six months
|
38,264
|
|||
Over
six months through one year
|
20,554
|
|||
Over
one year to three years
|
6,196
|
|||
Over
three years
|
3,383
|
|||
Total
|
$
|
103,321
|
2006
|
2005
|
2004
|
|||||||||||||||||
Weighted
|
Weighted
|
Weighted
|
|||||||||||||||||
Amount
|
Average
Rate
|
Amount
|
Average
Rate
|
Amount
|
Average
Rate
|
||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||
Within
1 year
|
$
|
65,000
|
5.16
|
%
|
$
|
13,799
|
3.40
|
%
|
$
|
16,000
|
2.35
|
%
|
|||||||
Over
1 year to 2 years
|
16,411
|
5.06
|
%
|
10,000
|
4.37
|
%
|
12,000
|
3.23
|
%
|
||||||||||
Over
2 years to 3 years
|
13,000
|
5.13
|
%
|
19,393
|
4.95
|
%
|
-
|
||||||||||||
Over
3 years to 4 years
|
16,111
|
3.20
|
%
|
-
|
-
|
||||||||||||||
Over
4 years to 5 years
|
39,184
|
4.60
|
%
|
20,318
|
3.19
|
%
|
22,247
|
4.87
|
%
|
||||||||||
Over
5 years
|
20,100
|
4.32
|
%
|
38,370
|
4.02
|
%
|
36,447
|
3.32
|
%
|
||||||||||
$
|
169,806
|
4.73
|
%
|
$
|
101,880
|
3.98
|
%
|
$
|
86,694
|
3.53
|
%
|
For
the Years Ended
|
||||||||||
December
31,
|
||||||||||
2006
|
2005
|
2004
|
||||||||
(In
thousands)
|
||||||||||
Balance
at year-end
|
$
|
10,425
|
$
|
8,434
|
$
|
4,317
|
||||
Average
amount outstanding during year
|
5,546
|
5,572
|
4,064
|
|||||||
Interest
expense incurred during year
|
167
|
90
|
39
|
|||||||
Maximum
amount outstanding at any month-end
|
10,425
|
8,675
|
6,015
|
|||||||
Average
interest rate during the year
|
3.01
|
%
|
1.62
|
%
|
0.96
|
%
|
||||
Weighted
average interest rate on year-end balances
|
3.38
|
%
|
2.12
|
%
|
1.19
|
%
|
·
|
the
total capital distributions for the applicable calendar year exceed
the
sum of the association’s net income for that year to date plus the
association’s retained net income for the preceding two years;
|
·
|
the
association would not be at least adequately capitalized following
the
distribution;
|
·
|
the
distribution would violate any applicable statute, regulation, agreement
or Office of Thrift Supervision-imposed condition; or
|
·
|
the
association is not eligible for expedited treatment of its
filings.
|
·
|
the
association would be undercapitalized following the
distribution;
|
·
|
the
proposed capital distribution raises safety and soundness concerns;
or
|
·
|
the
capital distribution would violate a prohibition contained in any
statute,
regulation or agreement.
|
·
|
well-capitalized
(at least 5% leverage capital, 6% Tier 1 risk-based capital and 10%
total
risk-based capital);
|
·
|
adequately
capitalized (at least 4% leverage capital, 4% Tier 1 risk-based capital
and 8% total risk-based capital);
|
·
|
undercapitalized
(less than 8% total risk-based capital, 4% Tier 1 risk-based capital
or 3%
leverage capital);
|
·
|
significantly
undercapitalized (less than 6% total risk-based capital, 3% Tier
1
risk-based capital or 3% leverage capital);
and
|
·
|
critically
undercapitalized (less than 2% tangible
capital).
|
ITEM
1A.
|
RISK
FACTORS
|
·
|
the
interest income we earn on our interest-earning assets, such as loans
and
securities; and
|
·
|
the
interest expense we pay on our interest-bearing liabilities, such
as
deposits and borrowings.
|
ITEM
1B.
|
UNRESOLVED
STAFF COMMENTS Not
applicable.
|
ITEM
2.
|
PROPERTIES
|
Location
|
Leased
or Owned
|
Year
Acquired or Leased
|
Square
Footage
|
Net
Book Value of Real Property
|
|||||||||
(In
thousands)
|
|||||||||||||
Main
Office:
|
|||||||||||||
95
Elm Street
|
Owned
|
1999
|
46,147
|
$
|
1,363
|
||||||||
West
Springfield, MA 01089
|
Full
Service Branches:
|
|||||||||||||
115
State Street
|
Leased
|
(1
|
)
|
3,401
|
112
|
||||||||
Springfield,
MA 01103
|
|||||||||||||
1077
St. James Avenue
|
Owned
|
2003
|
8,354
|
637
|
|||||||||
Springfield,
MA 01104
|
|||||||||||||
459
Main Street
|
Leased
|
(2
|
)
|
2,000
|
—
|
||||||||
Indian
Orchard, MA 01151
|
|||||||||||||
528-530
Center Street
|
Owned
|
2002
|
3,000
|
637
|
|||||||||
Ludlow,
MA 01056
|
|||||||||||||
1930
Wilbraham Road
|
Owned
|
2001
|
2,304
|
647
|
|||||||||
Springfield,
MA 01129
|
|||||||||||||
670
Bliss Road
|
Leased
|
(3
|
)
|
1,652
|
—
|
||||||||
Longmeadow,
MA 01106
|
|||||||||||||
1325
Springfield Street
|
Leased
|
(4
|
)
|
2,400
|
—
|
||||||||
Feeding
Hills, MA 01030
|
|
||||||||||||
180
Main Street
|
Leased
|
(5
|
)
|
2,800
|
254
|
||||||||
Northampton,
MA 01060
|
|||||||||||||
10
Elm Street
|
Owned
|
1981
|
8,500
|
17
|
|||||||||
Westfield,
MA 01085
|
|
||||||||||||
168
Southampton Road
|
Leased
|
(6
|
)
|
2,890
|
—
|
||||||||
Westfield,
MA 01085
|
|||||||||||||
|
|||||||||||||
14
Russell Road
|
Owned
|
2001
|
720
|
137
|
|||||||||
Huntington,
MA 01050
|
|||||||||||||
1830
Northampton Street
|
Owned
|
1994
|
6,409
|
305
|
|||||||||
Holyoke,
MA 01040
|
Other:
|
|||||||||||||
52
Van Deene Avenue
|
Owned
|
2005
|
(7)
|
547
|
720
|
||||||||
West
Springfield, MA 01089
|
|||||||||||||
33
Westfield Street
|
Owned
|
2002
|
(8)
|
1,720
|
1,232
|
||||||||
West
Springfield, MA 01089
|
|||||||||||||
140
Main Street
|
Leased
|
2006
|
(8,9)
|
1,875
|
—
|
||||||||
Northampton,
MA 01060
|
(1)
|
United
Bank has a lease for a five-year period expiring in June 2010 with
a
renewal option for five additional
years.
|
(2)
|
United
Bank has a lease for a five-year period expiring in May 2008 with
two
five-year renewal options.
|
(3)
|
United
Bank has a lease for a five-year period expiring in September 2011
with a
renewal option for five additional years.
|
(4)
|
United
Bank has a lease for a five-year period expiring in September 2010
with a
renewal option for five additional
years.
|
(5)
|
United
Bank has a lease for a ten-year period expiring in April 2016 with
two
five-year renewal options.
|
(6)
|
United
Bank has a lease for a twenty-five year period expiring in March
2031 with
two five-year renewal options.
|
(7)
|
This
office is a drive-up facility only.
|
(8)
|
This
financial services facility offers insurance and investment products
and
financial planning services.
|
(9)
|
United
Bank has a lease for a two-year period expiring in November 2008
with two
two-year renewal options.
|
ITEM
3.
|
LEGAL
PROCEEDINGS
|
ITEM
4.
|
SUBMISSION
OF MATTERS TO A VOTE OF SECURITY
HOLDERS
|
ITEM
5.
|
MARKET
FOR REGISTRANT’S COMMON EQUITY, RELATED
STOCKHOLDER MATTERS
AND ISSUER PURCHASES OF EQUITY
SECURITIES
|
Quarter
|
||||||||||
Ended
|
High
|
Low
|
Dividends
|
|||||||
March
31, 2006
|
$
|
12.46
|
$
|
11.33
|
$
|
0.05
|
||||
June
30, 2006
|
13.31
|
11.53
|
0.05
|
|||||||
September
30, 2006
|
14.23
|
12.11
|
0.05
|
|||||||
December
31, 2006
|
14.97
|
12.63
|
0.05
|
|||||||
September
30, 2005
|
12.61
|
11.06
|
-
|
|||||||
December
31, 2005
|
12.00
|
11.53
|
-
|
Period
Ended
|
|||||||||||||||||||
Index
|
07/13/05
|
|
12/31/05
|
|
03/31/06
|
|
06/30/06
|
|
09/30/06
|
|
12/31/05
|
||||||||
United
Financial Bancorp, Inc.
|
100.00
|
98.13
|
102.82
|
114.23
|
111.40
|
119.32
|
|||||||||||||
Russell
2000
|
100.00
|
101.41
|
115.54
|
109.74
|
110.22
|
120.04
|
|||||||||||||
SNL
MHC Thrift Index
|
100.00
|
100.48
|
109.31
|
113.85
|
124.47
|
137.60
|
|||||||||||||
SNL
Thrift Index
|
100.00
|
100.76
|
104.28
|
108.60
|
109.98
|
117.45
|
Plan
Category
|
Number
of securities to be issued upon exercise of outstanding options,
warrants
and rights
|
Weighted-average
exercise price of outstanding options, warrants and rights
|
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in column
(a))
|
|
(a)
|
(b)
|
(c)
|
Equity
compensation plans approved by security holders
|
756,500
|
$12.88
|
86,593
|
Equity
compensation plans not approved by security holders
|
-
|
-
|
-
|
Total
|
756,500
|
$12.88
|
86,593
|
(b)
|
Not
Applicable.
|
(c)
|
The
following table provides certain information with regard to shares
repurchased by the Company in the fourth quarter of
2006.
|
Period
|
(a)
Total
Number of Shares (or Units) Purchased
|
(b)
Average
Price Paid Per Share (or Unit)
|
(c)
Total
Number of Shares (or Units) Purchased as Part of Publicly Announced
Plans
or Programs (1)
|
(d)
Maximum
Number (or Approximate Dollar Value) of Shares (or Units) that May
Yet Be
Purchased Under the Plans or Programs
|
|||||||||
October
1 -31, 2006
|
-
|
$
|
-
|
-
|
858,000
|
||||||||
November
1 - 30, 2006
|
-
|
-
|
-
|
858,000
|
|||||||||
December
1 -31, 2006
|
1,945
|
13.76
|
1,945
|
856,055
|
|||||||||
Total
|
1,945
|
$
|
13.76
|
1,945
|
NA
|
ITEM
6.
|
SELECTED
FINANCIAL DATA
|
At
December 31,
|
||||||||||||||||
2006
|
2005
|
2004
|
2003
|
2002
|
||||||||||||
(In
thousands)
|
||||||||||||||||
Selected
Financial Condition Data:
|
||||||||||||||||
Total
assets
|
$
|
1,009,433
|
$
|
906,513
|
$
|
772,008
|
$
|
737,424
|
$
|
623,563
|
||||||
Cash
and cash equivalents
|
25,419
|
15,843
|
23,233
|
16,144
|
38,779
|
|||||||||||
Investment
securities available-for-sale
|
80,963
|
111,763
|
50,650
|
73,191
|
36,617
|
|||||||||||
Investment
securities held-to-maturity
|
3,241
|
3,325
|
2,498
|
2,175
|
737
|
|||||||||||
Mortgage-backed
securities available-for-sale
|
109,274
|
114,702
|
101,679
|
123,774
|
60,889
|
|||||||||||
Loans,
net (1)
|
756,180
|
630,558
|
569,243
|
497,078
|
463,383
|
|||||||||||
Deposits
|
685,686
|
653,611
|
613,672
|
594,748
|
533,704
|
|||||||||||
FHLB
advances
|
169,806
|
101,880
|
86,694
|
76,820
|
29,889
|
|||||||||||
Repurchase
agreements
|
10,425
|
8,434
|
4,317
|
4,218
|
1,146
|
|||||||||||
Stockholders'
equity
|
137,711
|
137,005
|
62,255
|
57,050
|
52,612
|
|||||||||||
Non-performing
assets (2)
|
1,850
|
3,319
|
3,784
|
1,865
|
1,036
|
Years
Ended December 31,
|
||||||||||||||||
2006
|
2005
|
2004
|
2003
|
2002
|
||||||||||||
(In
thousands)
|
||||||||||||||||
Selected
Operating Data:
|
||||||||||||||||
Interest
and dividend income
|
$
|
52,202
|
$
|
43,233
|
$
|
36,532
|
$
|
33,776
|
$
|
36,009
|
||||||
Interest
expense
|
24,647
|
16,206
|
12,148
|
11,583
|
14,703
|
|||||||||||
Net
interest income before provision for loan losses
|
27,555
|
27,027
|
24,384
|
22,193
|
21,306
|
|||||||||||
Provision
for loan losses
|
969
|
917
|
983
|
294
|
398
|
|||||||||||
Net
interest income after provision for loan losses
|
26,586
|
26,110
|
23,401
|
21,899
|
20,908
|
|||||||||||
Non-interest
income
|
5,392
|
5,020
|
5,134
|
5,703
|
4,522
|
|||||||||||
Non-interest
expense
|
24,036
|
24,112
|
19,179
|
17,785
|
16,971
|
|||||||||||
Income
before taxes
|
7,942
|
7,018
|
9,356
|
9,817
|
8,459
|
|||||||||||
Income
tax expense
|
3,018
|
2,649
|
3,828
|
3,917
|
3,270
|
|||||||||||
Net
income
|
$
|
4,924
|
$ |
4,369
|
^ |
$
|
5,528
|
$
|
5,900
|
$
|
5,189
|
At
or For the Years Ended December 31,
|
||||||||||||||||
2006
|
2005
|
2004
|
2003
|
2002
|
||||||||||||
Selected
Financial Ratios and Other Data:
|
||||||||||||||||
Performance
Ratios (3):
|
||||||||||||||||
Return
on average assets
|
0.51
|
%
|
0.51
|
%* |
0.73
|
%
|
0.86
|
%
|
0.84
|
%
|
||||||
Return
on average equity
|
3.59
|
%
|
4.45
|
%* |
9.25
|
%
|
10.72
|
%
|
10.47
|
%
|
||||||
Average
equity to average assets
|
14.35
|
%
|
11.42
|
%
|
7.87
|
%
|
8.07
|
%
|
8.03
|
%
|
||||||
Equity
to total assets at end of period (3)
|
13.64
|
%
|
15.11
|
%
|
8.06
|
%
|
7.74
|
%
|
8.44
|
%
|
||||||
Interest
rate spread (4)
|
2.23
|
%
|
2.77
|
%
|
3.03
|
%
|
3.12
|
%
|
3.23
|
%
|
||||||
Net
interest margin (5)
|
2.97
|
%
|
3.27
|
%
|
3.33
|
%
|
3.41
|
%
|
3.65
|
%
|
||||||
Average
interest-earning assets to average interest-bearing
liabilitites
|
128.10
|
%
|
125.61
|
%
|
118.30
|
%
|
116.42
|
%
|
116.77
|
%
|
||||||
Total
non-interest expense to average total assets
|
2.51
|
%
|
2.81
|
%* |
2.53
|
%
|
2.61
|
%
|
2.75
|
%
|
||||||
Efficiency
ratio (6)
|
72.95
|
%
|
75.25
|
%* |
64.98
|
%
|
63.75
|
%
|
65.71
|
%
|
||||||
Dividend
payout ratio
|
5.74
|
%
|
NA
|
NA
|
NA
|
NA
|
||||||||||
United
Bank Regulatory Capital Ratios (3,
7):
|
||||||||||||||||
Tier
I (core) capital
|
14.83
|
%
|
17.21
|
%
|
11.67
|
%
|
12.33
|
%
|
12.23
|
%
|
||||||
Tier
I (leverage) capital
|
10.82
|
%
|
11.71
|
%
|
8.11
|
%
|
7.76
|
%
|
8.25
|
%
|
||||||
Total
capital
|
15.86
|
%
|
18.28
|
%
|
12.76
|
%
|
13.43
|
%
|
13.40
|
%
|
||||||
Asset
Quality Ratios (3):
|
||||||||||||||||
Non-performing
assets as a percent of total assets (2)
|
0.18
|
%
|
0.37
|
%
|
0.49
|
%
|
0.25
|
%
|
0.17
|
%
|
||||||
Non-performing
loans as a percent of total loans (2)
|
0.17
|
%
|
0.27
|
%
|
0.66
|
%
|
0.36
|
%
|
0.21
|
%
|
||||||
Allowance
for loan losses as a percent of total loans
|
0.95
|
%
|
1.00
|
%
|
1.00
|
%
|
1.02
|
%
|
1.05
|
%
|
||||||
Allowance
for loan losses as a percent of non-
|
||||||||||||||||
performing
loans
|
560.40
|
%
|
371.69
|
%
|
151.96
|
%
|
278.97
|
%
|
507.53
|
%
|
||||||
Number
of full service customer facilities
|
13
|
11
|
11
|
11
|
11
|
(1)
|
The
allowance for loan losses at December 31, 2006, 2005, 2004, 2003
and 2002
was $7.2 million, $6.4 million, $5.8 million, $5.1 million and $4.9
million, respectively.
|
(2)
|
Non-performing
assets consist of non-performing loans and foreclosed real estate
owned
(“REO”). Non-performing loans consist of non-accrual and accruing loans
90
days or more overdue, while REO consists of real estate acquired
through
foreclosure and real estate acquired by acceptance of a deed-in-lieu
of
foreclosure.
|
(3)
|
Asset
Quality Ratios and Regulatory Capital Ratios and the “equity to total
assets” ratio are end of period ratios. With the exception of end of
period ratios, all ratios are based on average monthly balances during
the
indicated periods and are annualized where
appropriate.
|
(4)
|
The
interest rate spread represents the difference between weighted-average
yield on interest-earning assets and the weighted-average cost of
interest-bearing liabilities.
|
(5)
|
The
net interest margin represents net interest income as a percent of
average
interest-earning assets.
|
(6)
|
The
efficiency ratio represents non-interest expense divided by the sum
of net
interest income and non-interest
income.
|
(7)
|
Regulatory
Capital Ratios are reported for the Bank only and do not include
the
consolidating effect of United Financial Bancorp,
Inc.
|
^
|
Excluding
the effect of a $3,591 charitable contribution ($2,199 after taxes)
to
fund the newly-formed United Charitable Foundation, net income in
2005
would have amounted to $6,568.
|
*
|
Exclusive
of the contribution to the United Charitable Foundation in 2005,
return on
average assets, return on average equity, total non- interest expense
to
average total assets, and efficiency ratio would have been 0.76%,
6.70%,
2.43% and 64.41%, respectively.
|
ITEM
7.
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
Years
Ended December 31,
|
|||||||||||||||||||
2006
|
2005
|
||||||||||||||||||
Interest
|
Interest
|
||||||||||||||||||
Average
|
and
|
Yield/
|
Average
|
and
|
Yield/
|
||||||||||||||
Balance
|
Dividends
|
Cost
|
Balance
|
Dividends
|
Cost
|
||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||
Interest-earning
assets:
|
|||||||||||||||||||
Loans:
|
|||||||||||||||||||
Residential
real estate
|
$
|
410,340
|
$
|
23,817
|
5.80
|
%
|
$
|
362,208
|
$
|
20,168
|
5.57
|
%
|
|||||||
Commercial
real estate
|
189,694
|
12,485
|
6.58
|
%
|
158,820
|
9,781
|
6.16
|
%
|
|||||||||||
Commercial
and industrial
|
64,164
|
4,595
|
7.16
|
%
|
54,954
|
3,525
|
6.41
|
%
|
|||||||||||
Consumer
and other
|
29,005
|
1,441
|
4.97
|
%
|
21,004
|
1,066
|
5.08
|
%
|
|||||||||||
Total
loans
|
693,203
|
42,338
|
6.11
|
%
|
596,986
|
34,540
|
5.79
|
%
|
|||||||||||
Investment
securities
|
213,430
|
8,843
|
4.14
|
%
|
207,301
|
7,970
|
3.84
|
%
|
|||||||||||
Other
interest-earning assets
|
19,641
|
1,021
|
5.20
|
%
|
23,076
|
723
|
3.13
|
%
|
|||||||||||
Total
interest-earning assets
|
926,274
|
52,202
|
5.64
|
%
|
827,363
|
43,233
|
5.23
|
%
|
|||||||||||
Noninterest-earning
assets
|
30,280
|
31,458
|
|||||||||||||||||
Total
assets
|
$
|
956,554
|
$
|
858,821
|
|||||||||||||||
Interest-bearing
liabilities:
|
|||||||||||||||||||
Savings
accounts
|
$
|
76,688
|
638
|
0.83
|
%
|
$
|
93,550
|
594
|
0.63
|
%
|
|||||||||
Money
market
|
165,101
|
5,125
|
3.10
|
%
|
148,297
|
3,099
|
2.09
|
%
|
|||||||||||
NOW
accounts
|
36,050
|
103
|
0.29
|
%
|
37,770
|
200
|
0.53
|
%
|
|||||||||||
Certificates
of deposit
|
309,784
|
12,829
|
4.14
|
%
|
274,002
|
8,407
|
3.07
|
%
|
|||||||||||
Total
interest-bearing deposits
|
587,623
|
18,695
|
3.18
|
%
|
553,619
|
12,300
|
2.22
|
%
|
|||||||||||
FHLB
advances
|
127,397
|
5,621
|
4.41
|
%
|
96,743
|
3,671
|
3.79
|
%
|
|||||||||||
Other
interest-bearing liabilities
|
8,049
|
331
|
4.11
|
%
|
8,339
|
235
|
2.82
|
%
|
|||||||||||
Total
interest-bearing liabilities
|
723,069
|
24,647
|
3.41
|
%
|
658,701
|
16,206
|
2.46
|
%
|
|||||||||||
Demand
deposits
|
92,644
|
91,896
|
|||||||||||||||||
Other
noninterest-bearing liabilities
|
3,618
|
10,106
|
|||||||||||||||||
Total
liabilities
|
819,331
|
760,703
|
|||||||||||||||||
Stockholders'
equity
|
137,223
|
98,118
|
|||||||||||||||||
Total
liabilities and stockholders' equity
|
$
|
956,554
|
$
|
858,821
|
|||||||||||||||
Net
interest income
|
$
|
27,555
|
$
|
27,027
|
|||||||||||||||
Interest
rate spread(1)
|
2.23
|
%
|
2.77
|
%
|
|||||||||||||||
Net
interest-earning assets(2)
|
$
|
203,205
|
$
|
168,662
|
|||||||||||||||
Net
interest margin(3)
|
2.97
|
%
|
3.27
|
%
|
|||||||||||||||
Average
interest-bearing assets to average interest-bearing
liabilities
|
128.10
|
%
|
125.61
|
%
|
(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 represents total interest-earning assets
less
total interest-bearing liabilities.
|
(3)
|
Net
interest margin represents net interest income divided by average
total
interest-earning assets.
|
Years
ended December 31,
2006
vs. 2005
|
||||||||||
Increase
(Decrease) Due to
|
||||||||||
Volume
|
Rate
|
Net
|
||||||||
(In
thousands)
|
||||||||||
Interest-earning
assets:
|
||||||||||
Loans:
|
||||||||||
Residential
real estate
|
$
|
2,766
|
$
|
883
|
$
|
3,649
|
||||
Commercial
real estate
|
1,998
|
706
|
2,704
|
|||||||
Commercial
and industrial
|
631
|
439
|
1,070
|
|||||||
Consumer
and other
|
397
|
(22
|
)
|
375
|
||||||
Total
loans
|
5,792
|
2,006
|
7,798
|
|||||||
Investment
securities
|
241
|
632
|
873
|
|||||||
Other
interest-earning assets
|
(87
|
)
|
385
|
298
|
||||||
Total
interest-earning assets
|
5,946
|
3,023
|
8,969
|
|||||||
Interest-bearing
liabilities:
|
||||||||||
Savings
accounts
|
(119
|
)
|
163
|
44
|
||||||
Money
market accounts
|
299
|
1,727
|
2,026
|
|||||||
NOW
accounts
|
(10
|
)
|
(87
|
)
|
(97
|
)
|
||||
Certificates
of deposit
|
869
|
3,553
|
4,422
|
|||||||
Total
interest-bearing deposits
|
1,039
|
5,356
|
6,395
|
|||||||
FHLB
advances
|
1,288
|
662
|
1,950
|
|||||||
Other
interest-bearing liabilities
|
(8
|
)
|
104
|
96
|
||||||
Total
interest-bearing liabilities
|
2,319
|
6,122
|
8,441
|
|||||||
Change
in net interest income
|
$
|
3,627
|
$
|
(3,099
|
)
|
$
|
528
|
Years
Ended December 31,
|
|||||||||||||||||||
2005
|
2004
|
||||||||||||||||||
Interest
|
Interest
|
||||||||||||||||||
Average
|
and
|
Yield/
|
Average
|
and
|
Yield/
|
||||||||||||||
Balance
|
Dividends
|
Cost
|
Balance
|
Dividends
|
Cost
|
||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||
Interest-earning
assets:
|
|||||||||||||||||||
Loans:
|
|||||||||||||||||||
Residential
real estate
|
$
|
362,208
|
$
|
20,168
|
5.57
|
%
|
$
|
328,157
|
$
|
17,627
|
5.37
|
%
|
|||||||
Commercial
real estate
|
158,820
|
9,781
|
6.16
|
%
|
144,434
|
8,478
|
5.87
|
%
|
|||||||||||
Commercial
and industrial
|
54,954
|
3,525
|
6.41
|
%
|
45,527
|
2,417
|
5.31
|
%
|
|||||||||||
Consumer
and other
|
21,004
|
1,066
|
5.08
|
%
|
20,453
|
1,160
|
5.67
|
%
|
|||||||||||
Total
loans
|
596,986
|
34,540
|
5.79
|
%
|
538,571
|
29,682
|
5.51
|
%
|
|||||||||||
Investment
securities
|
207,301
|
7,970
|
3.84
|
%
|
179,036
|
6,582
|
3.68
|
%
|
|||||||||||
Other
interest-earning assets
|
23,076
|
723
|
3.13
|
%
|
14,764
|
268
|
1.82
|
%
|
|||||||||||
Total
interest-earning assets
|
827,363
|
43,233
|
5.23
|
%
|
732,371
|
36,532
|
4.99
|
%
|
|||||||||||
Noninterest-earning
assets
|
31,458
|
27,040
|
|||||||||||||||||
Total
assets
|
$
|
858,821
|
$
|
759,411
|
|||||||||||||||
Interest-bearing
liabilities:
|
|||||||||||||||||||
Savings
accounts
|
$
|
93,550
|
594
|
0.63
|
%
|
$
|
93,955
|
698
|
0.74
|
%
|
|||||||||
Money
market
|
148,297
|
3,099
|
2.09
|
%
|
151,159
|
1,710
|
1.13
|
%
|
|||||||||||
NOW
accounts
|
37,770
|
200
|
0.53
|
%
|
36,505
|
90
|
0.25
|
%
|
|||||||||||
Certificates
of deposit
|
274,002
|
8,407
|
3.07
|
%
|
245,395
|
6,497
|
2.65
|
%
|
|||||||||||
Total
interest-bearing deposits
|
553,619
|
12,300
|
2.22
|
%
|
527,014
|
8,995
|
1.71
|
%
|
|||||||||||
FHLB
advances
|
96,743
|
3,671
|
3.79
|
%
|
85,413
|
2,960
|
3.47
|
%
|
|||||||||||
Other
interest-bearing liabilities
|
8,339
|
235
|
2.82
|
%
|
6,729
|
193
|
2.87
|
%
|
|||||||||||
Total
interest-bearing liabilities
|
658,701
|
16,206
|
2.46
|
%
|
619,156
|
12,148
|
1.96
|
%
|
|||||||||||
Demand
deposits
|
91,896
|
78,713
|
|||||||||||||||||
Other
noninterest-bearing liabilities
|
10,106
|
1,761
|
|||||||||||||||||
Total
liabilities
|
760,703
|
699,630
|
|||||||||||||||||
Stockholders'
equity
|
98,118
|
59,781
|
|||||||||||||||||
Total
liabilities and stockholders' equity
|
$
|
858,821
|
$
|
759,411
|
|||||||||||||||
Net
interest income
|
$
|
27,027
|
$
|
24,384
|
|||||||||||||||
Interest
rate spread(1)
|
2.77
|
%
|
3.03
|
%
|
|||||||||||||||
Net
interest-earning assets(2)
|
$
|
168,662
|
$
|
113,215
|
|||||||||||||||
Net
interest margin(3)
|
3.27
|
%
|
3.33
|
%
|
|||||||||||||||
Average
interest-bearing assets to average interest-bearing
liabilities
|
125.61
|
%
|
118.29
|
%
|
(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 represents total interest-earning assets
less
total interest-bearing liabilities.
|
(3)
|
Net
interest margin represents net interest income divided by average
total
interest-earning assets.
|
Years
ended December 31,
2005
vs. 2004
|
||||||||||
Increase
(Decrease) Due to
|
||||||||||
Volume
|
Rate
|
Net
|
||||||||
(In
thousands)
|
||||||||||
Interest-earning
assets:
|
||||||||||
Loans:
|
||||||||||
Residential
real estate
|
$
|
1,879
|
$
|
663
|
$
|
2,542
|
||||
Commercial
real estate
|
872
|
431
|
1,303
|
|||||||
Commercial
and industrial
|
552
|
556
|
1,108
|
|||||||
Consumer
and other
|
26
|
(121
|
)
|
(95
|
)
|
|||||
Total
loans
|
3,329
|
1,529
|
4,858
|
|||||||
Investment
securities
|
1,076
|
312
|
1,388
|
|||||||
Other
interest-earning assets
|
199
|
256
|
455
|
|||||||
Total
interest-earning assets
|
4,604
|
2,097
|
6,701
|
|||||||
Interest-bearing
liabilities:
|
||||||||||
Savings
accounts
|
(3
|
)
|
(48
|
)
|
(51
|
)
|
||||
Money
market accounts
|
(18
|
)
|
1,406
|
1,388
|
||||||
NOW
accounts
|
3
|
55
|
58
|
|||||||
Certificates
of deposit
|
808
|
1,102
|
1,910
|
|||||||
Total
interest-bearing deposits
|
790
|
2,515
|
3,305
|
|||||||
FHLB
advances
|
414
|
297
|
711
|
|||||||
Other
interest-bearing liabilities
|
39
|
3
|
42
|
|||||||
Total
interest-bearing liabilities
|
1,243
|
2,815
|
4,058
|
|||||||
Change
in net interest income
|
$
|
3,361
|
$
|
(718
|
)
|
$
|
2,643
|
Net
Interest Income At-Risk
|
||||
Estimated
Increase
|
Estimated
Increase
|
|||
Change
in Interest Rates
|
(Decrease)
in NII
|
(Decrease)
in NII
|
||
(Basis
Points)
|
(December
31, 2006)
|
(December
31, 2005)
|
||
-200
|
12.1%
|
0.4%
|
||
Stable
|
0.0%
|
0.0%
|
||
+200
|
-10.9%
|
-3.4%
|
Payments
Due by Period
|
||||||||||||||||
Less
Than
|
One
to Three
|
Three
to Five
|
More
than
|
|||||||||||||
One
Year
|
Years
|
Years
|
Five
Years
|
Total
|
||||||||||||
Contractual
Obligations:
|
||||||||||||||||
Certificates
of Deposit
|
$
|
282,025
|
$
|
27,988
|
$
|
9,501
|
$
|
-
|
$
|
319,514
|
||||||
Federal
Home Loan Bank advances
|
65,000
|
29,411
|
55,295
|
20,100
|
169,806
|
|||||||||||
Repurchase
Agreements
|
10,425
|
-
|
-
|
-
|
10,425
|
|||||||||||
Standby
letters of credit
|
879
|
-
|
-
|
-
|
879
|
|||||||||||
Operating
Leases
|
498
|
839
|
589
|
3,224
|
8,677
|
|||||||||||
Total
|
$
|
358,827
|
$
|
58,238
|
$
|
65,385
|
$
|
23,324
|
$
|
509,301
|
||||||
Commitments
to extend credit
|
$
|
170,116
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
170,116
|
ITEM
7A.
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURE ABOUT MARKET
RISK
|
ITEM
8.
|
FINANCIAL
STATEMENTS AND SUPPLEMENTAL
DATA
|
Page
|
|
Report
of Independent Registered Public Accounting Firm
|
F-1
|
Financial
Statements
|
|
Consolidated
Balance Sheets
|
F-2
|
Consolidated
Statements of Earnings
|
F-3
|
Consolidated
Statements of Stockholders’ Equity and
Comprehensive Income
|
F-4
|
Consolidated
Statements of Cash Flows
|
F-5
|
Notes
to Consolidated Financial Statements
|
F-6
|
December 31,
|
December 31,
|
||||||
2006
|
2005
|
||||||
ASSETS
|
|||||||
Cash
and due from banks
|
$
|
15,459
|
$
|
15,841
|
|||
Interest-bearing
deposits
|
9,960
|
2
|
|||||
Total
cash and cash equivalents
|
25,419
|
15,843
|
|||||
Securities
available for sale, at fair value
|
190,237
|
226,465
|
|||||
Securities
held to maturity, at amortized cost (fair value of $3,227
at
|
|||||||
December
31, 2006 and $3,298 at December 31, 2005)
|
3,241
|
3,325
|
|||||
Loans,
net of allowance for loan losses of $7,218 at December 31,
2006
|
|||||||
and
$6,382 at December 31, 2005
|
756,180
|
630,558
|
|||||
Other
real estate owned
|
562
|
1,602
|
|||||
Accrued
interest receivable
|
4,320
|
3,928
|
|||||
Deferred
tax asset, net
|
2,851
|
1,245
|
|||||
Stock
in the Federal Home Loan Bank of Boston
|
9,274
|
6,588
|
|||||
Banking
premises and equipment, net
|
8,821
|
8,236
|
|||||
Bank-owned
life insurance
|
6,304
|
6,031
|
|||||
Other
assets
|
2,224
|
2,692
|
|||||
TOTAL
ASSETS
|
$
|
1,009,433
|
$
|
906,513
|
|||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
|||||||
Liabilities:
|
|||||||
Deposits:
|
|||||||
Interest-bearing
|
$
|
588,496
|
$
|
560,310
|
|||
Non-interest-bearing
|
97,190
|
93,301
|
|||||
Total
deposits
|
685,686
|
653,611
|
|||||
Federal
Home Loan Bank of Boston advances
|
169,806
|
101,880
|
|||||
Repurchase
agreements
|
10,425
|
8,434
|
|||||
Escrow
funds held for borrowers
|
1,121
|
1,129
|
|||||
Accrued
expenses and other liabilities
|
4,684
|
4,454
|
|||||
Total
liabilities
|
871,722
|
769,508
|
|||||
Commitments
and contingencies (Note L)
|
-
|
-
|
|||||
Stockholders’
equity:
|
|||||||
Preferred
stock, par value $0.01 per share, authorized 5,000,000
shares;
|
|||||||
none
issued
|
-
|
-
|
|||||
Common
stock, par value $0.01 per share, authorized 60,000,000
shares;
|
|||||||
17,205,995
shares issued at December 31, 2006 and 2005
|
172
|
172
|
|||||
Paid-in
capital
|
75,520
|
78,446
|
|||||
Retained
earnings
|
70,406
|
66,944
|
|||||
Unearned
compensation
|
(5,772
|
)
|
(6,092
|
)
|
|||
Treasury
stock, at cost (51,445 shares at December 31, 2006)
|
(664
|
)
|
-
|
||||
Accumulated
other comprehensive loss, net of taxes
|
(1,951
|
)
|
(2,465
|
)
|
|||
Total
stockholders’ equity
|
137,711
|
137,005
|
|||||
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
1,009,433
|
$
|
906,513
|
2006
|
2005
|
2004
|
||||||||
Interest
and dividend income:
|
||||||||||
Loans
|
$
|
42,338
|
$
|
34,540
|
$
|
29,682
|
||||
Investments
|
8,843
|
7,970
|
6,582
|
|||||||
Other
interest-earning assets
|
1,021
|
723
|
268
|
|||||||
Total
interest and dividend income
|
52,202
|
43,233
|
36,532
|
|||||||
Interest
expense:
|
||||||||||
Deposits
|
18,695
|
12,300
|
8,995
|
|||||||
Short-term
borrowings
|
3,198
|
1,675
|
373
|
|||||||
Long-term
debt
|
2,754
|
2,231
|
2,780
|
|||||||
Total
interest expense
|
24,647
|
16,206
|
12,148
|
|||||||
Net
interest income before provision for loan losses
|
27,555
|
27,027
|
24,384
|
|||||||
Provision
for loan losses
|
969
|
917
|
983
|
|||||||
Net
interest income after provision for loan losses
|
26,586
|
26,110
|
23,401
|
|||||||
Non-interest
income:
|
||||||||||
Fee
income on depositors’ accounts
|
4,190
|
3,744
|
3,683
|
|||||||
(Loss)
gain on sale of securities
|
(222
|
)
|
3
|
122
|
||||||
Income
from bank-owned life insurance
|
273
|
326
|
332
|
|||||||
Other
income
|
1,151
|
947
|
997
|
|||||||
Total
non-interest income
|
5,392
|
5,020
|
5,134
|
|||||||
Non-interest
expense:
|
||||||||||
Salaries
and benefits
|
12,888
|
11,167
|
9,564
|
|||||||
Occupancy
expenses
|
1,792
|
1,494
|
1,453
|
|||||||
Marketing
expenses
|
1,436
|
1,386
|
1,244
|
|||||||
Data
processing expenses
|
2,474
|
2,371
|
2,681
|
|||||||
Contributions
and sponsorships
|
174
|
3,792
|
192
|
|||||||
Professional
fees
|
1,148
|
732
|
336
|
|||||||
Other
expenses
|
4,124
|
3,170
|
3,709
|
|||||||
Total
non-interest expense
|
24,036
|
24,112
|
19,179
|
|||||||
Income
before income taxes
|
7,942
|
7,018
|
9,356
|
|||||||
Income
tax expense
|
3,018
|
2,649
|
3,828
|
|||||||
NET
INCOME
|
$
|
4,924
|
$
|
4,369
|
$
|
5,528
|
||||
Earnings
per share:
|
||||||||||
Basic
|
$
|
0.30
|
NA
|
NA
|
||||||
Diluted
|
$
|
0.30
|
NA
|
NA
|
||||||
Weighted
average shares outstanding:
|
||||||||||
Basic
|
16,467,874
|
NA
|
NA
|
|||||||
Diluted
|
16,476,933
|
NA
|
NA
|
Accumulated
|
|||||||||||||||||||||||||
Common
|
Other
|
||||||||||||||||||||||||
Shares
|
Common
|
Paid-In
|
Retained
|
Unearned
|
Treasury
|
Comprehensive
|
|||||||||||||||||||
Outstanding
|
Stock
|
Capital
|
Earnings
|
Compensation
|
Stock
|
Loss
|
Total
|
||||||||||||||||||
Balances
at December 31, 2003
|
-
|
$
|
-
|
$
|
-
|
$
|
57,289
|
$
|
-
|
$
|
-
|
$
|
(239
|
)
|
$
|
57,050
|
|||||||||
Impact
of reorganization
|
(150
|
)
|
(150
|
)
|
|||||||||||||||||||||
Net
income
|
5,528
|
5,528
|
|||||||||||||||||||||||
Net
unrealized loss on securities available for sale, net of reclassification
adjustments and taxes
|
(173
|
)
|
(173
|
)
|
|||||||||||||||||||||
Total
comprehensive income
|
5,355
|
||||||||||||||||||||||||
Balances
at December 31, 2004
|
-
|
-
|
-
|
62,667
|
-
|
-
|
(412
|
)
|
62,255
|
||||||||||||||||
Net
income
|
-
|
-
|
-
|
4,369
|
-
|
-
|
-
|
4,369
|
|||||||||||||||||
Net
unrealized loss on securities available for sale, net of reclassification
adjustments and taxes
|
-
|
-
|
-
|
-
|
-
|
-
|
(2,053
|
)
|
(2,053
|
)
|
|||||||||||||||
Total
comprehensive income
|
2,316
|
||||||||||||||||||||||||
Issuance
of common stock, net of offering costs of $1,900
|
7,671,973
|
77
|
74,745
|
-
|
-
|
-
|
-
|
74,822
|
|||||||||||||||||
Issuance
of common stock to MHC
|
9,189,922
|
92
|
-
|
(92
|
)
|
-
|
-
|
-
|
-
|
||||||||||||||||
Issuance
of common stock to United
|
|||||||||||||||||||||||||
Charitable
Foundation.
|
344,100
|
3
|
3,646
|
-
|
-
|
-
|
-
|
3,649
|
|||||||||||||||||
Shares
purchased for ESOP
|
-
|
-
|
-
|
-
|
(6,413
|
)
|
-
|
-
|
(6,413
|
)
|
|||||||||||||||
ESOP
shares committed to be released
|
-
|
-
|
55
|
-
|
321
|
-
|
-
|
376
|
|||||||||||||||||
Balances
at December 31, 2005
|
17,205,995
|
172
|
78,446
|
66,944
|
(6,092
|
)
|
-
|
(2,465
|
)
|
137,005
|
|||||||||||||||
Net
income
|
-
|
-
|
-
|
4,924
|
-
|
-
|
-
|
4,924
|
|||||||||||||||||
Net
unrealized gain on securities available for sale, net of reclassification
adjustments and taxes
|
-
|
-
|
-
|
-
|
-
|
-
|
514
|
514
|
|||||||||||||||||
Total
comprehensive income
|
5,438
|
||||||||||||||||||||||||
Cash
dividends declared ($0.20 per share)
|
-
|
-
|
-
|
(1,462
|
)
|
-
|
-
|
-
|
(1,462
|
)
|
|||||||||||||||
Treasury
stock purchases
|
(341,945
|
)
|
-
|
-
|
-
|
-
|
(4,405
|
)
|
-
|
(4,405
|
)
|
||||||||||||||
Reissuance
of treasury shares in connection with restricted stock
grants
|
290,500
|
-
|
(3,741
|
)
|
-
|
-
|
3,741
|
-
|
-
|
||||||||||||||||
Stock-based
compensation
|
-
|
-
|
728
|
-
|
-
|
-
|
-
|
728
|
|||||||||||||||||
ESOP
shares committed to be released
|
-
|
-
|
87
|
-
|
320
|
-
|
-
|
407
|
|||||||||||||||||
Balances
at December 31, 2006
|
17,154,550
|
$
|
172
|
$
|
75,520
|
$
|
70,406
|
$
|
(5,772
|
)
|
$
|
(664
|
)
|
$
|
(1,951
|
)
|
$
|
137,711
|
2006
|
2005
|
2004
|
||||||||
Cash
flows from operating activities:
|
||||||||||
Net
income
|
$
|
4,924
|
$
|
4,369
|
$
|
5,528
|
||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||||
Provision
for loan losses
|
969
|
917
|
983
|
|||||||
ESOP
expense
|
407
|
376
|
-
|
|||||||
Stock-based
compensation
|
728
|
-
|
-
|
|||||||
Contribution
to United Charitable Foundation
|
-
|
3,649
|
-
|
|||||||
Amortization
of premiums and discounts
|
308
|
670
|
1,062
|
|||||||
Depreciation
and amortization
|
838
|
667
|
647
|
|||||||
Amortization
of intangible assets
|
25
|
-
|
-
|
|||||||
Provision
for other real estate owned
|
-
|
-
|
(21
|
)
|
||||||
Gain
on sales of loans
|
(3
|
)
|
(2
|
)
|
(13
|
)
|
||||
Net
loss (gain) on sale of property and equipment
|
21
|
(4
|
)
|
(2
|
)
|
|||||
Net
loss (gain) on sale of available for sale securities
|
222
|
(3
|
)
|
(122
|
)
|
|||||
Income
tax provision (benefit)
|
(1,679
|
)
|
978
|
(1
|
)
|
|||||
Increase
in cash surrender value of bank-owned life insurance
|
(273
|
)
|
(326
|
)
|
(332
|
)
|
||||
(Increase)
decrease in accrued interest receivable
|
(392
|
)
|
(1,065
|
)
|
282
|
|||||
Decrease
(increase) in other assets
|
475
|
(2,005
|
)
|
678
|
||||||
(Decrease)
increase in accrued expenses and other liabilities
|
(42
|
)
|
337
|
469
|
||||||
Net
cash provided by operating activities
|
6,528
|
8,558
|
9,158
|
|||||||
Cash
flows from investing activities:
|
||||||||||
Purchases
of securities available for sale
|
(47,764
|
)
|
(124,036
|
)
|
(58,142
|
)
|
||||
Proceeds
from sales of securities available for sale
|
28,896
|
2,597
|
32,985
|
|||||||
Proceeds
from maturities and principal repayments of securities available
for
sale
|
55,430
|
44,127
|
68,646
|
|||||||
Purchases
of securities held to maturity
|
-
|
(909
|
)
|
(404
|
)
|
|||||
Proceeds
from maturities and principal repayments of securities held to
maturity
|
75
|
75
|
77
|
|||||||
Purchases
of Federal Home Loan Bank of Boston stock
|
(2,686
|
)
|
(567
|
)
|
(2,072
|
)
|
||||
Refund
of Cooperative Central Bank deposit
|
-
|
-
|
1,522
|
|||||||
Proceeds
from sales of other real estate owned
|
1,852
|
-
|
39
|
|||||||
Net
loan originations and principal repayments
|
(127,570
|
)
|
(64,046
|
)
|
(78,428
|
)
|
||||
Proceeds
from sales of loans
|
170
|
215
|
5,314
|
|||||||
Purchases
of property and equipment
|
(1,372
|
)
|
(1,245
|
)
|
(382
|
)
|
||||
Cash
paid to acquire Levine Financial Group
|
(100
|
)
|
-
|
-
|
||||||
Proceeds
from sale of property and equipment
|
-
|
16
|
14
|
|||||||
Net
cash used in investing activities
|
(93,069
|
)
|
(143,773
|
)
|
(30,831
|
)
|
||||
Cash
flows from financing activities:
|
||||||||||
Net
increase in deposits
|
32,075
|
39,938
|
18,924
|
|||||||
Proceeds
of Federal Home Loan Bank of Boston advances
|
133,000
|
148,365
|
185,714
|
|||||||
Repayments
of Federal Home Loan Bank of Boston advances
|
(65,074
|
)
|
(133,179
|
)
|
(175,839
|
)
|
||||
Net
increase in repurchase agreements
|
1,991
|
4,118
|
98
|
|||||||
Net
increase (decrease) in escrow funds held for borrowers
|
(8
|
)
|
174
|
14
|
||||||
Treasury
stock purchases
|
(4,405
|
)
|
-
|
-
|
||||||
Cash
dividends paid
|
(1,462
|
)
|
-
|
-
|
||||||
Proceeds
from stock offering subscriptions
|
-
|
74,822
|
-
|
|||||||
Acquistion
of common stock by ESOP
|
-
|
(6,413
|
)
|
-
|
||||||
Impact
of reorganization
|
-
|
-
|
(150
|
)
|
||||||
Net
cash provided by financing activities
|
96,117
|
127,825
|
28,761
|
|||||||
Increase
(decrease) in cash and cash equivalents
|
9,576
|
(7,390
|
)
|
7,088
|
||||||
Cash
and cash equivalents at beginning of year
|
15,843
|
23,233
|
16,145
|
|||||||
Cash
and cash equivalents at end of period
|
$
|
25,419
|
$
|
15,843
|
$
|
23,233
|
||||
Supplemental
Disclosure of Cash Flow Information:
|
||||||||||
Cash
paid during the period:
|
||||||||||
Interest
on deposits and other borrowings
|
$
|
24,353
|
$
|
16,080
|
$
|
12,102
|
||||
Income
taxes - net
|
3,882
|
2,786
|
2,635
|
|||||||
Transfer
of loans to other real estate owned
|
562
|
1,602
|
-
|
2006
|
2005
|
2004
|
||||||||
Change
in unrealized holding gains (losses) on available for sale
securities
|
$
|
633
|
$
|
(3,371
|
)
|
$
|
(180
|
)
|
||
Reclassification
adjustment for losses (gains) realized in income
|
222
|
(3
|
)
|
(122
|
)
|
|||||
Net
change in unrealized gains (losses)
|
855
|
(3,374
|
)
|
(302
|
)
|
|||||
Tax
effect
|
341
|
1,321
|
129
|
|||||||
Other
comprehensive income (loss)
|
$
|
514
|
$
|
(2,053
|
)
|
$
|
(173
|
)
|
Amortized
|
Unrealized
|
Unrealized
|
Fair
|
||||||||||
Cost
|
Gain
|
Losses
|
Value
|
||||||||||
Securities
Available for Sale
|
|||||||||||||
December
31, 2006:
|
|||||||||||||
Government-sponsored
enterprises
|
$
|
78,248
|
$
|
4
|
$
|
(883
|
)
|
$
|
77,369
|
||||
Mortgage-backed
securities
|
111,481
|
107
|
(2,314
|
)
|
109,274
|
||||||||
Corporate
bonds
|
3,415
|
14
|
(120
|
)
|
3,309
|
||||||||
Subtotal
|
193,144
|
125
|
(3,317
|
)
|
189,952
|
||||||||
Marketable
equity securities
|
294
|
-
|
(9
|
)
|
285
|
||||||||
Total
|
$
|
193,438
|
$
|
125
|
$
|
(3,326
|
)
|
$
|
190,237
|
||||
December
31, 2005:
|
|||||||||||||
Government-sponsored
enterprises
|
$
|
99,957
|
$
|
1
|
$
|
(1,397
|
)
|
$
|
98,561
|
||||
Mortgage-backed
securities
|
117,259
|
102
|
(2,659
|
)
|
114,702
|
||||||||
Corporate
bonds
|
13,011
|
54
|
(135
|
)
|
12,930
|
||||||||
Subtotal
|
230,227
|
157
|
(4,191
|
)
|
226,193
|
||||||||
Marketable
equity securities
|
294
|
-
|
(22
|
)
|
272
|
||||||||
Total
|
$
|
230,521
|
$
|
157
|
$
|
(4,213
|
)
|
$
|
226,465
|
Amortized
|
Unrealized
|
Unrealized
|
Fair
|
||||||||||
Cost
|
Gain
|
Losses
|
Value
|
||||||||||
Securities
Held to Maturity
|
|||||||||||||
December
31, 2006:
|
|||||||||||||
IRB
|
$
|
1,271
|
$
|
-
|
$
|
-
|
$
|
1,271
|
|||||
Municipal
bonds
|
1,970
|
4
|
(18
|
)
|
1,956
|
||||||||
Total
|
$
|
3,241
|
$
|
4
|
$
|
(18
|
)
|
$
|
3,227
|
||||
December
31, 2005:
|
|||||||||||||
IRB
|
$
|
1,346
|
$
|
-
|
$
|
-
|
$
|
1,346
|
|||||
Municipal
bonds
|
1,979
|
-
|
(27
|
)
|
1,952
|
||||||||
Total
|
$
|
3,325
|
$
|
-
|
$
|
(27
|
)
|
$
|
3,298
|
Less
than 12 months
|
12
months or longer
|
Total
|
||||||||||||||||||||
Fair
|
Unrealized
|
Fair
|
Unrealized
|
Number of
|
Fair
|
Unrealized
|
||||||||||||||||
Value
|
Losses
|
Value
|
Losses
|
Securities
|
Value
|
Losses
|
||||||||||||||||
2006:
|
||||||||||||||||||||||
Securities
Available for Sale
|
||||||||||||||||||||||
Government-sponsored
enterprises
|
$
|
1,239
|
$
|
(19
|
)
|
$
|
62,182
|
$
|
(864
|
)
|
28
|
$
|
63,421
|
$
|
(883
|
)
|
||||||
Mortgage-backed
securities
|
13,609
|
(117
|
)
|
78,972
|
(2,197
|
)
|
86
|
92,581
|
(2,314
|
)
|
||||||||||||
Corporate
bonds
|
-
|
-
|
1,841
|
(120
|
)
|
4
|
1,841
|
(120
|
)
|
|||||||||||||
Marketable
equity securities
|
-
|
-
|
285
|
(9
|
)
|
2
|
285
|
(9
|
)
|
|||||||||||||
Total
|
$
|
14,848
|
$
|
(136
|
)
|
$
|
143,280
|
$
|
(3,190
|
)
|
120
|
$
|
158,128
|
$
|
(3,326
|
)
|
||||||
Securities
Held to Maturity
|
||||||||||||||||||||||
Municipal
bonds
|
$
|
212
|
$
|
(1
|
)
|
$
|
1,207
|
$
|
(17
|
)
|
7
|
$
|
1,419
|
$
|
(18
|
)
|
||||||
Total
|
$
|
212
|
$
|
(1
|
)
|
$
|
1,207
|
$
|
(17
|
)
|
7
|
$
|
1,419
|
$
|
(18
|
)
|
||||||
2005:
|
||||||||||||||||||||||
Securities
Available for Sale
|
||||||||||||||||||||||
Government-sponsored
enterprises
|
$
|
69,298
|
$
|
(765
|
)
|
$
|
28,519
|
$
|
(632
|
)
|
50
|
$
|
97,817
|
$
|
(1,397
|
)
|
||||||
Mortgage-backed
securities
|
53,636
|
(976
|
)
|
54,052
|
(1,683
|
)
|
88
|
107,688
|
(2,659
|
)
|
||||||||||||
Corporate
bonds
|
2,078
|
(74
|
)
|
3,803
|
(61
|
)
|
13
|
5,881
|
(135
|
)
|
||||||||||||
Marketable
equity securities
|
100
|
(1
|
)
|
172
|
(21
|
)
|
2
|
272
|
(22
|
)
|
||||||||||||
Total
|
$
|
125,112
|
$
|
(1,816
|
)
|
$
|
86,546
|
$
|
(2,397
|
)
|
153
|
$
|
211,658
|
$
|
(4,213
|
)
|
||||||
Securities
Held to Maturity
|
||||||||||||||||||||||
Municipal
bonds
|
$
|
1,365
|
$
|
(12
|
)
|
$
|
587
|
$
|
(15
|
)
|
9
|
$
|
1,952
|
$
|
(27
|
)
|
||||||
Total
|
$
|
1,365
|
$
|
(12
|
)
|
$
|
587
|
$
|
(15
|
)
|
9
|
$
|
1,952
|
$
|
(27
|
)
|
2006
|
2005
|
2004
|
||||||||
Proceeds
from sales
|
$
|
28,896
|
$
|
2,597
|
$
|
32,985
|
||||
Gross
gains
|
56
|
16
|
122
|
|||||||
Gross
losses
|
(278
|
)
|
(13
|
)
|
-
|
At
December 31, 2006
|
|||||||||||||
Securities
Available for Sale
|
Securities
Held to Maturity
|
||||||||||||
Amortized
|
Fair
|
Amortized
|
Fair
|
||||||||||
Cost
|
Value
|
Cost
|
Value
|
||||||||||
Due
in one year or less
|
$
|
31,698
|
$
|
31,575
|
$
|
201
|
$
|
198
|
|||||
Due
from one year to five years
|
57,709
|
56,174
|
1,312
|
1,299
|
|||||||||
Due
from five years to ten years
|
34,957
|
34,081
|
878
|
880
|
|||||||||
Due
after ten years
|
68,780
|
68,122
|
850
|
850
|
|||||||||
$
|
193,144
|
$
|
189,952
|
$
|
3,241
|
$
|
3,227
|
December 31,
|
December 31,
|
||||||
2006
|
2005
|
||||||
One-to-four
family residential real estate
|
$
|
319,108
|
$
|
285,236
|
|||
Commercial
real estate
|
175,564
|
150,099
|
|||||
Construction
|
54,759
|
28,872
|
|||||
Home
equity loans
|
112,739
|
86,045
|
|||||
Commercial
and industrial
|
69,762
|
59,591
|
|||||
Consumer
|
30,181
|
25,949
|
|||||
Total
loans
|
762,113
|
635,792
|
|||||
Net
deferred loan costs and fees
|
1,285
|
1,148
|
|||||
Allowance
for loan losses
|
(7,218
|
)
|
(6,382
|
)
|
|||
Loans,
net
|
$
|
756,180
|
$
|
630,558
|
2006
|
2005
|
||||||
Beginning
balance
|
$
|
1,373
|
$
|
1,359
|
|||
New
loans
|
10
|
335
|
|||||
Repayments
|
(409
|
)
|
(321
|
)
|
|||
Ending
balance
|
$
|
974
|
$
|
1,373
|
2006
|
2005
|
2004
|
||||||||
Balance
at beginning of period
|
$
|
6,382
|
$
|
5,750
|
$
|
5,094
|
||||
Provision
for loan losses
|
969
|
917
|
983
|
|||||||
Charge-offs
|
(186
|
)
|
(455
|
)
|
(558
|
)
|
||||
Recoveries
|
53
|
170
|
231
|
|||||||
Balance
at end of period
|
$
|
7,218
|
$
|
6,382
|
$
|
5,750
|
Estimated
|
||||||||||
2006
|
2005
|
Useful Lives
|
||||||||
Land
and improvements
|
$
|
2,146
|
$
|
2,135
|
||||||
Buildings
and improvements
|
7,475
|
7,309
|
25
- 40 Years
|
|||||||
Leasehold
improvements
|
1,976
|
1,708
|
||||||||
Furniture
and equipment
|
2,271
|
1,573
|
5
Years
|
|||||||
13,868
|
12,725
|
|||||||||
Less
accumulated depreciation and amortization
|
(5,047
|
)
|
(4,489
|
)
|
||||||
$
|
8,821
|
$
|
8,236
|
Years
ending December 31,
|
||||
2007
|
$
|
498
|
||
2008
|
434
|
|||
2009
|
405
|
|||
2010
|
350
|
|||
2011
|
239
|
|||
Thereafter
|
3,224
|
|||
Total
minimum lease payments
|
$
|
5,150
|
2006
|
2005
|
||||||
Demand
|
$
|
97,190
|
$
|
93,301
|
|||
NOW
|
37,523
|
39,922
|
|||||
Regular
savings
|
65,475
|
87,253
|
|||||
Money
market
|
164,463
|
154,177
|
|||||
Retirement
|
55,368
|
52,694
|
|||||
Certificates
of deposit
|
265,667
|
226,264
|
|||||
$
|
685,686
|
$
|
653,611
|
At
|
||||
December 31,
|
||||
2006
|
||||
Three
months or less
|
$
|
34,924
|
||
Over
three months through six months
|
38,264
|
|||
Over
six months through one year
|
20,554
|
|||
Over
one year to three years
|
6,196
|
|||
Over
three years
|
3,383
|
|||
Total
|
$
|
103,321
|
2007
|
$
|
282,025
|
||
2008
|
17,089
|
|||
2009
|
10,899
|
|||
2010
|
8,738
|
|||
2011
|
763
|
|||
Total
time deposits
|
$
|
319,514
|
2006
|
2005
|
2004
|
||||||||
NOW
|
$
|
103
|
$
|
148
|
$
|
90
|
||||
Regular
savings
|
638
|
647
|
698
|
|||||||
Money
market
|
5,125
|
3,098
|
1,710
|
|||||||
Retirement
|
2,087
|
1,900
|
1,354
|
|||||||
Certificates
of deposit
|
10,742
|
6,507
|
5,143
|
|||||||
Total
|
$
|
18,695
|
$
|
12,300
|
$
|
8,995
|
2006
|
2005
|
2004
|
|||||||||||||||||
Weighted
|
Weighted
|
Weighted
|
|||||||||||||||||
Amount
|
Average
Rate
|
Amount
|
Average
Rate
|
Amount
|
Average
Rate
|
||||||||||||||
Within
1 year
|
$
|
65,000
|
5.16
|
%
|
$
|
13,799
|
3.40
|
%
|
$
|
16,000
|
2.35
|
%
|
|||||||
Over
1 year to 2 years
|
16,411
|
5.06
|
%
|
10,000
|
4.37
|
%
|
12,000
|
3.23
|
%
|
||||||||||
Over
2 years to 3 years
|
13,000
|
5.13
|
%
|
19,393
|
4.95
|
%
|
-
|
|
% | ||||||||||
Over
3 years to 4 years
|
16,111
|
3.20
|
%
|
-
|
|
% |
-
|
|
% | ||||||||||
Over
4 years to 5 years
|
39,184
|
4.60
|
% |
20,318
|
3.19
|
%
|
22,247
|
4.87
|
%
|
||||||||||
Over
5 years
|
20,100
|
4.32
|
% |
38,370
|
4.02
|
%
|
36,447
|
3.32
|
%
|
||||||||||
$
|
169,806
|
4.73
|
%
|
$
|
101,880
|
3.98
|
%
|
$
|
86,694
|
3.53
|
% |
December
31,
|
||||||||||
2006
|
2005
|
2004
|
||||||||
Balance
at year-end
|
$
|
10,425
|
$
|
8,434
|
$
|
4,317
|
||||
Average
amount outstanding during year
|
5,546
|
5,572
|
4,064
|
|||||||
Interest
expense incurred during year
|
167
|
90
|
39
|
|||||||
Maximum
amount outstanding at any month-end
|
10,425
|
8,675
|
6,015
|
|||||||
Average
interest rate during the year
|
3.01
|
%
|
1.62
|
%
|
0.96
|
%
|
||||
Weighted
average interest rate at year-end balances
|
3.38
|
%
|
2.12
|
%
|
1.19
|
%
|
Years
Ended December 31,
|
||||||||||
2006
|
2005
|
2004
|
||||||||
Current
tax provision:
|
||||||||||
Federal
|
$
|
3,618
|
$
|
1,417
|
$
|
2,970
|
||||
State
|
1,079
|
254
|
859
|
|||||||
4,697
|
1,671
|
3,829
|
||||||||
Deferred
tax provision (benefit):
|
||||||||||
Federal
|
(1,289
|
)
|
704
|
(1
|
)
|
|||||
State
|
(390
|
)
|
274
|
0
|
||||||
(1,679
|
)
|
978
|
(1
|
)
|
||||||
$
|
3,018
|
$
|
2,649
|
$
|
3,828
|
Years
Ended December 31,
|
||||||||||
2006
|
2005
|
2004
|
||||||||
Statutory
tax rate
|
34.0
|
%
|
34.0
|
%
|
34.0
|
%
|
||||
Increase
(decrease) resulting from:
|
||||||||||
State
taxes, net of federal tax benefit
|
5.7
|
%
|
5.0
|
%
|
6.1
|
%
|
||||
Other,
net
|
(1.7
|
%)
|
(1.2
|
%)
|
0.8
|
%
|
||||
Effective
tax rates
|
38.0
|
%
|
39.0
|
%
|
40.9
|
%
|
December
31,
|
|||||||
2006
|
2005
|
||||||
Deferred
tax asset:
|
|||||||
Federal
|
$
|
4,744
|
$
|
4,769
|
|||
State
|
1,548
|
1,583
|
|||||
6,292
|
6,352
|
||||||
Deferred
tax liability:
|
|||||||
Federal
|
(2,558
|
)
|
(3,839
|
)
|
|||
State
|
(883
|
)
|
(1,268
|
)
|
|||
(3,441
|
)
|
(5,107
|
)
|
||||
Net
deferred tax asset
|
$
|
2,851
|
$
|
1,245
|
2006
|
|
2005
|
|||||
Cash
basis of accounting
|
$
|
29
|
$
|
64
|
|||
Net
unrealized loss on securities available for sale
|
426
|
500
|
|||||
Depreciation
|
492
|
376
|
|||||
Deferred
expense
|
(1,044
|
)
|
(858
|
)
|
|||
Allowance
for loan loss
|
2,955
|
2,598
|
|||||
Employee
benefit plans
|
1,337
|
1,304
|
|||||
Market
value adjustment - loans
|
(2,391
|
)
|
(3,912
|
)
|
|||
Contribution
carryover
|
1,048
|
1,510
|
|||||
Other
|
(1
|
)
|
(337
|
)
|
|||
Net
deferred tax asset
|
$
|
2,851
|
$
|
1,245
|
2006
|
|
2005
|
|||||
Balance
at beginning of year
|
$
|
1,245
|
$
|
1,551
|
|||
Deferred
tax provision (benefit)
|
1,679
|
(978
|
)
|
||||
Change
in unrealized (loss) gain on securities available for sale
|
(73
|
)
|
672
|
||||
Balance
at end of year
|
$
|
2,851
|
$
|
1,245
|
Year
Ended
|
||||
December 31,
|
||||
2006
|
||||
Net
income
|
$
|
4,924
|
||
Weighted
average common shares applicable to basic EPS
|
16,467,874
|
|||
Effect
of dilutive potential common shares (1,
2)
|
9,059
|
|||
Weighted
average common shares applicable to diluted EPS
|
16,476,933
|
|||
Earnings
per share:
|
||||
Basic
|
$
|
0.30
|
||
Diluted
|
$
|
0.30
|
||
|
(1)
|
Options
to purchase 756,500 shares were outstanding but not included
in the
computation of diluted earnings per share because they were
antidulutive.
|
(2)
|
Includes
incremental shares related to stock options and restricted
stock.
|
|
|
Stock
Awards Outstanding
|
Stock
Options Outstanding
|
|||||||||||||
|
|
Weighted-
|
|
Weighted-
|
||||||||||||
Shares
|
Average
|
Average
|
||||||||||||||
Available
|
Number
of
|
Grant
|
Number
of
|
Exercise
|
||||||||||||
|
for
Grant
|
Shares
|
Price
|
Shares
|
Price
|
|||||||||||
Balance
at December 31, 2005
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
New
Incentive Plan
|
1,180,330
|
-
|
-
|
-
|
-
|
|||||||||||
Granted
|
(1,047,000
|
)
|
290,500
|
12.86
|
756,500
|
12.88
|
||||||||||
Stock
options exercised
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
Shares
vested
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
Forfeited
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
Cancelled
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
Balance
at December 31, 2006
|
133,330
|
290,500
|
$
|
12.86
|
756,500
|
$
|
12.88
|
Expected
term
|
6.50
years
|
|||
Volatility
|
25.00
|
%
|
||
Expected
dividend yield
|
2.00
|
%
|
||
Weighted
average risk-free interest rate
|
4.81
|
%
|
|
Stock
Options
|
||||||
|
Outstanding
|
Exercisable
|
|||||
|
|
||||||
Total
number of shares
|
756,500
|
-
|
|||||
Weighted
average exercise price
|
$
|
12.88
|
-
|
||||
Aggregate
intrinsic value
|
$
|
699
|
-
|
||||
Weighted
average remaining contractual term
|
9.6
years
|
-
|
December
31,
|
|||||||
2006
|
2005
|
||||||
Allocated
|
32,065
|
-
|
|||||
Committed
to be released
|
32,065
|
32,065
|
|||||
Unallocated
|
577,171
|
609,236
|
|||||
641,301
|
641,301
|
2006
|
2005
|
||||||
Unused
lines of credit
|
$
|
135,374
|
$
|
114,016
|
|||
Amounts
due mortgagors
|
34,742
|
16,833
|
|||||
Standby
letters of credit
|
879
|
1,383
|
|||||
Commitments
to originate loans
|
42,551
|
15,831
|
2006
|
2005
|
||||||||||||
Carrying
|
Estimated
|
Carrying
|
Estimated
|
||||||||||
Value
|
Fair
Value
|
Value
|
Fair
Value
|
||||||||||
Financial
Assets:
|
|||||||||||||
Cash
and cash equivalents
|
$
|
25,419
|
$
|
25,419
|
$
|
15,843
|
$
|
15,843
|
|||||
Securities
available for sale
|
190,237
|
190,237
|
226,465
|
226,465
|
|||||||||
Securities
held to maturity
|
3,241
|
3,227
|
3,325
|
3,298
|
|||||||||
Stock
in Federal Home Loan Bank of Boston
|
9,274
|
9,274
|
6,588
|
6,588
|
|||||||||
Net
loans
|
756,180
|
733,196
|
630,558
|
630,288
|
|||||||||
Accrued
interest receivable
|
4,320
|
4,320
|
3,928
|
3,928
|
|||||||||
Financial
Liabilities:
|
|||||||||||||
Deposits
(with no stated maturity)
|
366,172
|
366,172
|
375,967
|
375,967
|
|||||||||
Time
deposits
|
319,514
|
318,916
|
277,644
|
279,309
|
|||||||||
Federal
Home Loan Bank of Boston advances
|
169,806
|
167,051
|
101,880
|
98,946
|
|||||||||
Accrued
interest payable
|
695
|
695
|
400
|
400
|
|||||||||
Repurchase
agreements
|
10,425
|
10,425
|
8,434
|
8,434
|
To
Be Well Capitalized
|
|||||||||||||||||||
For
Capital
|
Under
Regulatory
|
||||||||||||||||||
Actual
|
Adequacy
Purposes
|
Framework
|
|||||||||||||||||
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||||
As
of December 31, 2006:
|
|||||||||||||||||||
Total
Capital
|
|
|
|
|
|
||||||||||||||
(to
Risk Weighted Assets)
|
$
|
111,045
|
15.9%
|
>
|
$
|
56,000
|
>
|
8.0%
|
>
|
$
|
70,000
|
>
|
10.0%
|
|
|||||
|
|||||||||||||||||||
Tier
I (Core) Capital
|
|||||||||||||||||||
(to
Risk Weighted Assets)
|
103,827
|
14.8%
|
>
|
28,000
|
>
|
4.0%
|
>
|
42,000
|
>
|
6.0%
|
|
||||||||
|
|
||||||||||||||||||
Tier
I Leverage Capital
|
|||||||||||||||||||
(to
Average Total Assets)
|
103,827
|
10.8%
|
>
|
38,380
|
>
|
4.0%
|
>
|
47,975
|
>
|
5.0%
|
|
||||||||
|
|||||||||||||||||||
|
|||||||||||||||||||
As
of December 31, 2005:
|
|||||||||||||||||||
Total
Capital
|
|||||||||||||||||||
(to
Risk Weighted Assets)
|
$
|
108,500
|
18.3%
|
>
|
$
|
47,475
|
>
|
8.0%
|
>
|
$
|
59,343
|
>
|
10.0%
|
|
|||||
|
|||||||||||||||||||
Tier
I (Core) Capital
|
|||||||||||||||||||
(to
Risk Weighted Assets)
|
102,117
|
17.2%
|
>
|
23,737
|
>
|
4.0%
|
>
|
35,606
|
>
|
6.0%
|
|
||||||||
|
|||||||||||||||||||
Tier
I Leverage Capital
|
|||||||||||||||||||
(to
Average Total Assets)
|
102,117
|
11.7%
|
>
|
34,873
|
>
|
4.0%
|
>
|
43,591
|
>
|
5.0%
|
|
BALANCE
SHEETS
|
||||||||
December
31,
|
December
31,
|
|||||||
2006
|
2005
|
|||||||
ASSETS
|
||||||||
Cash
and due from banks
|
$
|
336
|
$
|
14
|
||||
Interest-bearing
deposits
|
7,344
|
-
|
||||||
Total
cash and cash equivalents
|
7,680
|
14
|
||||||
Investment
in Bank
|
102,278
|
99,816
|
||||||
Securities
available for sale, at fair value
|
21,441
|
31,186
|
||||||
ESOP
loan receivable
|
5,891
|
6,049
|
||||||
Other
assets
|
827
|
113
|
||||||
TOTAL
ASSETS
|
$
|
138,117
|
$
|
137,178
|
||||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||||||
Other
liabilities
|
$
|
406
|
$
|
173
|
||||
Stockholders’
equity
|
137,711
|
137,005
|
||||||
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
138,117
|
$
|
137,178
|
STATEMENTS
OF INCOME
|
||||||||||
Years
Ended December 31,
|
||||||||||
2006
|
|
2005
|
|
2004
|
||||||
Income:
|
||||||||||
Investment
interest
|
$
|
1,258
|
$
|
617
|
$
|
-
|
||||
ESOP
loan interest
|
439
|
189
|
-
|
|||||||
Loss
on sale of securities
|
(9
|
)
|
-
|
-
|
||||||
Total
income
|
1,688
|
806
|
-
|
|||||||
Expense:
|
||||||||||
Charitable
contribution to Foundation
|
-
|
3,591
|
-
|
|||||||
Professional
services
|
958
|
266
|
-
|
|||||||
Other
expenses
|
31
|
63
|
64
|
|||||||
Total
expense
|
989
|
3,920
|
64
|
|||||||
Income
(loss) before income taxes and equity in undistributed
|
||||||||||
earnings
in the Bank
|
699
|
(3,114
|
)
|
(64
|
)
|
|||||
Income
tax expense (benefit)
|
235
|
(894
|
)
|
(26
|
)
|
|||||
Income
(loss) before equity in undistributed earnings of the Bank
|
464
|
(2,220
|
)
|
(38
|
)
|
|||||
Equity
in undistributed earnings of the Bank
|
4,460
|
6,589
|
5,566
|
|||||||
NET
INCOME
|
$
|
4,924
|
$
|
4,369
|
$
|
5,528
|
STATEMENTS
OF CASH FLOWS
|
||||||||||
Years
Ended December 31,
|
||||||||||
2006
|
|
2005
|
|
2004
|
||||||
Cash
flows from operating activities:
|
||||||||||
Net
income
|
$
|
4,924
|
$
|
4,369
|
$
|
5,528
|
||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||||
Equity
in undistributed earnings of the bank
|
(4,460
|
)
|
(6,589
|
)
|
(5,566
|
)
|
||||
Net
amortization of discounts and premiums
|
(83
|
)
|
(46
|
)
|
-
|
|||||
Net
loss on sale of available for sale securities
|
9
|
-
|
-
|
|||||||
Increase
in deferred income taxes
|
3
|
255
|
-
|
|||||||
Charitable
contribution to Foundation
|
-
|
3,649
|
-
|
|||||||
Decrease
(increase) in accrued interest receivable
|
57
|
(322
|
)
|
-
|
||||||
(Increase) in
other assets
|
(717
|
)
|
(182
|
)
|
(26
|
)
|
||||
Intercompany
payables and other liabilities
|
233
|
107
|
19
|
|||||||
Net
cash (used in) provided by operating activities
|
(34
|
)
|
1,241
|
(45
|
)
|
|||||
Cash
flows from investing activities:
|
||||||||||
Purchases
of securities available for sale
|
(2,094
|
)
|
(32,963
|
)
|
-
|
|||||
Proceeds
from sales of securities available for sale
|
4,990
|
-
|
-
|
|||||||
Proceeds
from maturities and principal repayments of securities available
for
sale
|
6,934
|
1,676
|
-
|
|||||||
Loan
to fund ESOP
|
-
|
(6,413
|
)
|
-
|
||||||
Principal
payments on ESOP loan
|
158
|
364
|
-
|
|||||||
Net
cash provided by (used in) investing activities
|
9,988
|
(37,336
|
)
|
-
|
||||||
Cash flows from financing activities: | ||||||||||
Initial funding
by Bank
|
- | - | 150 | |||||||
Investment
in United Bank
|
3,579
|
(38,818
|
)
|
-
|
||||||
Treasury
stock purchases
|
(4,405
|
)
|
-
|
-
|
||||||
Cash
dividends paid
|
(1,462
|
)
|
-
|
-
|
||||||
Net
proceeds from stock issuance
|
-
|
74,822
|
150
|
|||||||
Net
cash (used in) provided by financing activities
|
(2,288
|
)
|
36,004
|
-
|
||||||
Increase
(decrease) in cash and cash equivalents
|
7,666
|
(91
|
)
|
105
|
||||||
Cash
and cash equivalents at beginning of year
|
14
|
105
|
-
|
|||||||
Cash
and cash equivalents at end of year
|
$
|
7,680
|
$
|
14
|
$
|
105
|
Three
Months Ended
|
|||||||||||||
March
31
|
June
30
|
September
30
|
December
31
|
||||||||||
2006:
|
|||||||||||||
Interest
income
|
$
|
12,147
|
$
|
12,625
|
$
|
13,494
|
$
|
13,936
|
|||||
Interest
expense
|
5,239
|
5,860
|
6,550
|
6,998
|
|||||||||
Net
interest income
|
6,908
|
6,765
|
6,944
|
6,938
|
|||||||||
Provision
for loan losses
|
162
|
300
|
165
|
342
|
|||||||||
Non-interest
income
|
1,258
|
1,441
|
1,294
|
1,399
|
|||||||||
Non-interest
expense
|
5,776
|
5,836
|
5,579
|
6,845
|
|||||||||
Income
before income taxes
|
2,228
|
2,070
|
2,494
|
1,150
|
|||||||||
Income
tax expense
|
873
|
780
|
981
|
384
|
|||||||||
Net
income
|
$
|
1,355
|
$
|
1,290
|
$
|
1,513
|
$
|
766
|
|||||
Basic
earnings per share
|
$
|
0.08
|
$
|
0.08
|
$
|
0.09
|
$
|
0.05
|
|||||
Diluted
earnings per share
|
$
|
0.08
|
$
|
0.08
|
$
|
0.09
|
$
|
0.05
|
|||||
2005:
|
|||||||||||||
Interest
income
|
$
|
9,716
|
$
|
10,327
|
$
|
11,456
|
$
|
11,734
|
|||||
Interest
expense
|
3,369
|
3,819
|
4,249
|
4,769
|
|||||||||
Net
interest income
|
6,347
|
6,508
|
7,207
|
6,965
|
|||||||||
Provision
for loan losses
|
275
|
275
|
275
|
92
|
|||||||||
Non-interest
income
|
1,135
|
1,255
|
1,324
|
1,306
|
|||||||||
Non-interest
expense
|
4,937
|
4,826
|
8,623
|
5,726
|
|||||||||
Income
(loss) before income taxes
|
2,270
|
2,662
|
(367
|
)
|
2,453
|
||||||||
Income
tax expense (benefit)
|
904
|
1,063
|
(195
|
)
|
877
|
||||||||
Net
income (loss)
|
$
|
1,366
|
$
|
1,599
|
$
|
(172
|
)
|
$
|
1,576
|
||||
Basic
earnings per share
|
NA
|
NA
|
NA
|
$
|
0.10
|
||||||||
Diluted
earnings per share
|
NA
|
NA
|
NA
|
$
|
0.10
|
ITEM
9.
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
|
ITEM
9A.
|
CONTROLS
AND PROCEDURES
|
(a)
|
Evaluation
of disclosure controls and
procedures.
|
(b)
|
Management’s
annual report on internal control over financial
reporting.
|
(c)
|
Attestation
report
|
(d)
|
Changes
to internal controls
|
ITEM
9B.
|
OTHER
INFORMATION
|
ITEM
10.
|
DIRECTORS
, EXECUTIVE OFFICERS AND COPORATE
GOVERNANCE
|
ITEM
11.
|
EXECUTIVE
COMPENSATION
|
ITEM
12.
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
|
ITEM
13.
|
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS, DIRECTOR
INDEPENDENCE
|
ITEM
14.
|
PRINCIPAL
ACCOUNTANT FEES AND
SERVICES
|
ITEM
15.
|
EXHIBITS
AND FINANCIAL STATEMENT
SCHEDULES
|
(a)(1)
|
Financial
Statements
|
(A)
|
Report
of Independent Registered Public Accounting Firm
|
(B)
|
Consolidated
Balance Sheets - at December 31, 2006 and
2005
|
(C)
|
Consolidated
Statements of Earnings - Years ended December 31, 2006, 2005 and
2004
|
(D)
|
Consolidated
Statements of Stockholders’ Equity and Comprehensive Income - at December
31, 2006, 2005 and 2004
|
(E)
|
Consolidated
Statements of Cash Flows - Years ended December 31, 2006, 2005 and
2004
|
(F)
|
Notes
to Consolidated Financial
Statements.
|
(a)(2) |
Financial
Statement Schedules
|
(b)
|
Not
applicable
|
(c)
|
Not
applicable
|
(a)(3)
|
Exhibits
|
3.1
|
Charter
of United Financial Bancorp, Inc.
(1)
|
3.2
|
Resolution
and Consent of Sole Stockholder Amending the Charter of United Financial
Bancorp, Inc. (1)
|
3.3
|
Bylaws
of United Financial Bancorp, Inc.
(2)
|
4
|
Form
of Common Stock Certificate of United Financial Bancorp, Inc.
(1)
|
10.1
|
Form
of Employee Stock Ownership Plan
(1)
|
10.2
|
Executive
Supplemental Compensation Agreement by and between United Bank and
Richard
B. Collins (1)
|
10.3
|
Executive
Supplemental Compensation Agreement by and between United Bank and
Keith
E. Harvey (1)
|
10.4
|
Executive
Supplemental Compensation Agreement by and between United Bank and
John J.
Patterson (1)
|
10.5
|
United
Bank 2004 and 2005 Incentive Plans
(1)
|
10.6
|
Deferred
Income Agreement by and between United Bank and Donald G. Helliwell
(1)
|
10.7
|
Deferred
Income Agreement by and between United Bank and Robert W. Bozenhard,
Jr.
(1)
|
10.8
|
Deferred
Income Agreement by and between United Bank and George W. Jones
(1)
|
10.9
|
Directors
Fee Continuation Plan (1)
|
10.10
|
Form
of Employment Agreement by and between United Bank and Richard B.
Collins
(1)
|
10.11
|
Form
of Change in Control Agreement by and between United Bank and certain
executive officers (1)
|
10.12
|
United
Bank 2006 Stock-Based Incentive Plan
(3)
|
21
|
Subsidiaries
of Registrant (1)
|
Consent
of Independent Registered Public Accounting
Firm.
|
Certification
of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
Certification
of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
Statement
of Chief Executive Officer and Chief Financial Officer pursuant to
Section
906 of the Sarbanes-Oxley Act of
2002
|
(1)
|
Incorporated
by reference to the Registration Statement on Form S-1 of United
Financial
Bancorp, Inc. (file no. 333-123371), originally filed with the Securities
and Exchange Commission on March 16,
2005.
|
(2)
|
Incorporated
by reference to the Form 10-Q of United Financial Bancorp, Inc. filed
with
the Securities and Exchange Commission on August 9,
2006.
|
(3)
|
Incorporated
by reference to Appendix B of the Registrant’s definitive Proxy Statement
for the Company’s 2006 Annual Meeting filed with the Securities and
Exchange Commission on June 12,
2006.
|
UNITED
FINANCIAL BANCORP, INC.
|
||
Date:
March 15, 2007
|
By:
|
/s/
Richard B. Collins
|
Richard
B. Collins
|
||
Chief
Executive Officer, President and Director
|
||
(Duly
Authorized
Representative)
|
Signatures
|
Title
|
Date
|
||
/s/
Richard B. Collins
|
Chief
Executive Officer,
|
March
15, 2007
|
||
Richard
B. Collins
|
President
and Director (Principal Executive Officer)
|
|||
/s/
Mark A. Roberts
|
Executive
Vice President and
|
March
15, 2007
|
||
Mark
A. Roberts
|
Chief
Financial Officer (Principal Financial and Accounting
Officer)
|
|||
/s/
Robert W. Bozenhard, Jr.
|
Chairman
of the Board
|
March
15, 2007
|
||
Robert
W. Bozenhard, Jr.
|
||||
/s/
Michael F. Crowley
|
Director
|
March
15, 2007
|
||
Michael
F. Crowley
|
||||
/s/
Carol Moore Cutting
|
Director
|
March
15, 2007
|
||
Carol
Moore Cutting
|
||||
/s/
Carol A. Leary
|
Director
|
March
15, 2007
|
||
Carol
A. Leary
|
||||
/s/
G. Todd Marchant
|
Director
|
March
15, 2007
|
||
G.
Todd Marchant
|
||||
/s/
Kevin E. Ross
|
Director
|
March
15, 2007
|
||
Kevin
E. Ross
|
||||
/s/
Robert A. Stewart, Jr.
|
Director
|
March
15, 2007
|
||
Robert
A. Stewart, Jr.
|
||||
/s/
Thomas H. Themistos
|
Director
|
March
15, 2007
|
||
Thomas
H. Themistos
|
||||
/s/
Michael F. Werenski
|
Director
|
March
15, 2007
|
||
Michael
F. Werenski
|