Century Bancorp, Inc. Reports Second Quarter Results and Declares Quarterly Dividend

Net interest income totaled $20.9 million for the first six months of 2008 as compared to $19.0 million for the same period in 2007. The 10.0% increase in net interest income for the period is due to an increase of thirty-three basis points in the net interest margin, from 2.52% on a fully taxable equivalent basis in 2007 to 2.85% on the same basis for 2008. Included in interest income for the six months ended June 30, 2008 is $52,000 of prepayment fees collected on loans compared to $418,000 for the same period a year ago, a decrease of $366,000.

At June 30, 2008, total equity was $120.6 million compared to $118.8 million at December 31, 2007. The Company's equity increased as a result of earnings offset by an increase in accumulated other comprehensive loss, net of taxes and dividends paid. The Company's leverage ratio stood at 9.22% at June 30, 2008, compared to 9.12% at June 30, 2007. Book value as of June 30, 2008 was $21.76 per share compared to $19.78 at June 30, 2007.

The Company's allowance for loan losses was $9.5 million or 1.24% of loans outstanding at the end of the second quarter of 2008, compared to $9.3 million, or 1.29% of loans outstanding at June 30, 2007 and $9.6 million, or 1.33% of loans outstanding at December 31, 2007. Non-performing assets totaled $3.8 million at June 30, 2008, compared to $1.8 million at December 31, 2007 and $1.5 million at June 30, 2007. Non-performing assets increased primarily as a result of an increase in consumer mortgages and small business loans on non-accrual.

The Company's Board of Directors voted a regular quarterly dividend of 12.00 cents ($0.12) per share on the Company's Class A common stock, and 6.00 cents ($0.06) per share on the Company's Class B common stock. The dividends were declared payable August 15, 2008 to stockholders of record on August 1, 2008.

The Company, through its subsidiary bank, Century Bank and Trust Company, a state chartered full service commercial bank, operating twenty-two full-service branches in the Greater Boston area, offers a full range of Business, Personal and Institutional Services.

Century Bank and Trust Company is a member of the FDIC and is an Equal Housing Lender.

This press release contains certain "forward-looking statements" with respect to the financial condition, results of operations and business of the Company. Actual results may differ from those contemplated by these statements. The Company wishes to caution readers not to place undue reliance on any forward-looking statements. The Company disclaims any intent or obligation to update publicly any such forward-looking statements, whether in response to new information, future events or otherwise.

Century Bancorp, Inc. and Subsidiaries Consolidated Comparative Statements of Condition (unaudited) (in thousands) June 30, December 31, Assets 2008 2007 --------------------------------------------- ---------- ------------ Cash and Due From Banks $ 78,641 $ 66,974 Federal Funds Sold and Interest-bearing Deposits In Other Banks 93,003 232,927 Securities Available-For-Sale (AFS) 484,358 403,635 Securities Held-to-Maturity 203,693 183,710 Loans: Commercial & Industrial 124,996 117,332 Construction & Land Development 55,519 62,412 Commercial Real Estate 311,550 299,920 Residential Real Estate 179,053 168,204 Consumer and Other 10,258 10,949 Home Equity 83,113 67,434 ---------- ------------ Total Loans 764,489 726,251 Less: Allowance for Loan Losses 9,469 9,633 ---------- ------------ Net Loans 755,020 716,618 Bank Premises and Equipment 22,497 21,985 Accrued Interest Receivable 6,356 6,590 Goodwill 2,714 2,714 Core Deposit Intangible 1,477 1,671 Other Assets 66,499 43,457 ---------- ------------ Total Assets $1,714,258 $1,680,281 ========== ============ Liabilities --------------------------------------------- Demand Deposits $ 284,942 $ 289,526 Interest Bearing Deposits: Savings and NOW Deposits 335,608 310,858 Money Market Accounts 306,194 234,099 Time Deposits 247,304 295,578 ---------- ------------ Total Interest Bearing 889,106 840,535 ---------- ------------ Total Deposits 1,174,048 1,130,061 Borrowed Funds: Securities Sold Under Agreements to Repurchase 99,150 85,990 Other Borrowed Funds 257,585 289,885 ---------- ------------ Total Borrowed Funds 356,735 375,875 Other Liabilities 26,772 19,456 Subordinated Debentures 36,083 36,083 ---------- ------------ Total Liabilities 1,593,638 1,561,475 Total Stockholders' Equity 120,620 118,806 ---------- ------------ Total Liabilities & Stockholders' Equity $1,714,258 $1,680,281 ========== ============

Century Bancorp, Inc. and Subsidiaries Consolidated Comparative Statements of Income (unaudited) For the Quarter and Six Months Ended June 30, 2008 and 2007 (in thousands) Quarter Ended Six Months June 30, Ended June 30, ------------------------------- 2008 2007 2008 2007 --------------- --------------- Interest Income: Loans $11,882 $13,132 $24,144 $26,103 Securities Held-to-Maturity 2,094 2,350 3,999 4,746 Securities Available-for-Sale 4,757 3,451 9,136 7,003 Federal Funds Sold and Interest- bearing Deposits In Other Banks 737 1,904 1,953 3,731 ------- ------- ------- ------- Total Interest Income 19,470 20,837 39,232 41,583 Interest Expense: Savings and NOW Deposits 1,458 1,590 3,072 3,182 Money Market Accounts 1,829 2,436 3,419 4,822 Time Deposits 2,271 4,047 5,187 8,657 Securities Sold Under Agreements to Repurchase 359 771 875 1,544 Other Borrowed Funds and Subordinated Debentures 2,897 2,204 5,791 4,387 ------- ------- ------- ------- Total Interest Expense 8,814 11,048 18,344 22,592 ------- ------- ------- ------- Net Interest Income 10,656 9,789 20,888 18,991 Provision For Loan Losses 925 300 1,625 600 ------- ------- ------- ------- Net Interest Income After Provision for Loan Losses 9,731 9,489 19,263 18,391 Other Operating Income Service Charges on Deposit Accounts 2,028 1,863 4,009 3,649 Lockbox Fees 827 823 1,599 1,557 Net Gain on Sales of Investments 2 - 102 - Other Income 620 406 1,189 735 ------- ------- ------- ------- Total Other Operating Income 3,477 3,092 6,899 5,941 Operating Expenses Salaries and Employee Benefits 6,315 6,287 12,605 12,500 Occupancy 1,079 918 2,143 1,914 Equipment 742 773 1,472 1,506 Other 2,607 2,269 4,907 4,629 ------- ------- ------- ------- Total Operating Expenses 10,743 10,247 21,127 20,549 ------- ------- ------- ------- Income Before Income Taxes 2,465 2,334 5,035 3,783 Income Tax Expense 589 711 1,359 1,156 ------- ------- ------- ------- Net Income $ 1,876 $ 1,623 $ 3,676 $ 2,627 ======= ======= ======= =======

Century Bancorp, Inc. and Subsidiaries Consolidated Year-to-Date Average Comparative Statements of Condition (unaudited) (in thousands) June 30, June 30, Assets 2008 2007 ----------------------------------------------- ---------- ----------- Cash and Due From Banks $ 57,223 $ 58,447 Federal Funds Sold and Interest-Bearing Deposits in Other Banks 147,191 142,886 Securities Available-For-Sale (AFS) 421,492 380,716 Securities Held-to-Maturity 192,451 261,474 Total Loans 742,168 719,945 Less: Allowance for Loan Losses 9,710 9,793 ---------- ----------- Net Loans 732,458 710,152 Unrealized Gain(Loss) on Securities AFS 1,707 (6,668) Bank Premises and Equipment 22,449 23,162 Accrued Interest Receivable 6,886 6,977 Goodwill 2,714 2,714 Core Deposit Intangible 1,584 1,970 Other Assets 43,751 42,555 ---------- ----------- Total Assets $1,629,906 $1,624,385 ========== =========== Liabilities ----------------------------------------------- Demand Deposits $ 259,514 $ 278,371 Interest Bearing Deposits: Savings and NOW Deposits 356,144 308,314 Money Market Accounts 280,653 297,938 Time Deposits 270,143 367,396 ---------- ----------- Total Interest Bearing 906,940 973,648 ---------- ----------- Total Deposits 1,166,454 1,252,019 Borrowed Funds: Securities Sold Under Agreements to Repurchase 95,100 83,599 Other Borrowed Funds 189,656 120,731 ---------- ----------- Total Borrowed Funds 284,756 204,330 Other Liabilities 21,298 23,338 Subordinated Debentures 36,083 36,083 ---------- ----------- Total Liabilities 1,508,591 1,515,770 Total Stockholders' Equity 121,315 108,615 ---------- ----------- Total Liabilities & Stockholders' Equity $1,629,906 $1,624,385 ========== =========== Total Average Earning Assets - QTD $1,538,302 $1,483,675 ========== =========== Total Average Earning Assets - YTD $1,503,302 $1,505,021 ========== ===========

Century Bancorp, Inc. and Subsidiaries Consolidated Selected Key Financial Information (unaudited) (in thousands, except share data) June 30, June 30, 2008 2007 ----------- ----------- Performance Measures: ---------------------------------------------- Earnings per average share, basic, quarter $ 0.34 $ 0.29 Earnings per average share, diluted, quarter $ 0.34 $ 0.29 Earnings per average share, basic, year-to- date $ 0.66 $ 0.47 Earnings per average share, diluted, year-to- date $ 0.66 $ 0.47 Return on average assets, year-to-date 0.45% 0.33% Return on average stockholders' equity, year- to-date 6.09% 4.88% Net interest margin (taxable equivalent), quarter 2.86% 2.64% Net interest margin (taxable equivalent), year-to-date 2.85% 2.52% Efficiency ratio, year-to-date 74.6% 82.3% Book value per share $ 21.76 $ 19.78 Tangible book value per share $ 21.00 $ 18.96 Tangible capital / tangible assets 6.81% 6.92% Common Share Data: Average shares outstanding, basic, quarter 5,543,781 5,542,304 Average shares outstanding, basic, year-to- date 5,543,792 5,541,768 Average shares outstanding, diluted, quarter 5,546,128 5,548,105 Average shares outstanding, diluted, year- to-date 5,546,423 5,549,651 Shares outstanding Class A 3,516,304 3,513,704 Shares outstanding Class B 2,027,100 2,028,600 ----------- ----------- Total shares outstanding at period end 5,543,404 5,542,304 =========== =========== Assets Quality and Other Data: ---------------------------------------------- Allowance for loan losses / loans 1.24% 1.29% Nonaccrual loans $ 3,382 $ 1,454 Nonperforming assets $ 3,835 $ 1,454 Loans 90 days past due and still accruing $ - $ - Net charge-offs (recoveries), year-to-date $ 1,789 $ 999 Leverage ratio 9.22% 9.12% Tier 1 risk weighted capital ratio 15.66% 16.50% Total risk weighted capital ratio 16.63% 17.55% Total risk weighted assets $ 978,349 $ 885,536

SOURCE: Century Bancorp, Inc.

Century Bancorp, Inc. William P. Hornby, CPA, 781-393-4630 Fax: 781-393-4071 whornby@century-bank.com