Exhibit 99.1

Boston Private Financial Holdings Reports Third Quarter 2010 Results

Q3 Net Loss of $0.10/Share vs. $0.07/Share Net Loss in Q2 10

Boston, MA – October 27, 2010 – Boston Private Financial Holdings, Inc. (NASDAQ: BPFH) (the “Company”) today reported a third quarter 2010 GAAP Net Loss Attributable to the Company of $7.2 million, compared to Net Income Attributable to the Company of $1.1 million in the second quarter of 2010. The net loss for the 2010 period was primarily driven by a $32.1 million in Provision for Loan Losses, largely resulting from credit-related stress in the commercial real estate portfolio at the Company’s Northern California banking affiliate.

After accounting for non-cash equity adjustments and preferred dividends, the Company reported a third quarter 2010 GAAP loss per share of $0.10 compared to a GAAP loss per share of $0.07 in the second quarter of 2010.

President and Chief Executive Officer Clayton G. Deutsch said, “We are taking action based on ongoing economic stress in Northern California and within the commercial real estate market. Due primarily to deterioration in four large relationships in the third quarter, we have substantially increased the Provision for Loan Losses, which drove our net loss for the quarter. We continue to work proactively to deal with the challenges in that market and will continue to maintain an appropriately conservative posture.”

Mr. Deutsch continued, “More broadly, we see a number of encouraging signs across the Company this quarter, highlighted by our pre-tax income, excluding Provision for Loan Losses, of $12.8 million. Excluding the executive transition charges, this figure increases to $16.3 million, which is a 58% year-over-year increase on a normalized basis. We posted a strong overall increase in revenue across our banks and non-banks, and are demonstrating positive expense leverage and positive margin development.”

Key Financials

 

•

Revenue for the third quarter was $73.7 million, an increase of $3.1 million, or 4%, from $70.7 million on a linked quarter basis. Revenues were up 11% from $66.2 million compared to the same period in 2009.

 

•

Net Interest Income for the third quarter was $46.4 million, an increase of $1.4 million, or 3%, from $45.0 million on a linked quarter basis. Net Interest Income was up 17% from $39.7 million compared to the same period in 2009.

 

•

Total Fee Income for the third quarter was $25.5 million, a decrease of $0.3 million, or 1%, from $25.8 million on a linked quarter basis. Total Fee Income was up 6% from $24 million compared to the same period in 2009.

 

•

Net Interest Margin for the third quarter was 3.42%, up 13 basis points from 3.29% on a linked quarter basis. Net Interest Margin was up 38 basis points from 3.04% compared to the same period in 2009.

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•

Operating Expenses for the third quarter were $61 million, an increase of $4.3 million, or 8%, from $56.7 million on a linked quarter basis. Operating Expenses were up 9% from $55.9 million compared to the same period in 2009. Executive transition charges of $3.5 million accounted for the majority of the increases.

 

•

Tangible Common Equity/Tangible Assets (“TCE/TA”) at the end of the third quarter was 6.80%, a decrease of 31 basis points from 7.11% on a linked quarter basis. TCE/TA was up 49 basis points from 6.31% for the same period in 2009.

 

•

Total Balance Sheet Assets as of the end of the third quarter were up $164 million, or 3%, to $6 billion on a linked quarter basis. Total Balance Sheet Assets were also up 3% from $5.9 billion compared to the same period in 2009.

 

•

Provision for Loan Losses for the third quarter was $32.1 million, an increase of $17.1 million, or 114%, from $15 million on a linked quarter basis. Provision for Loan Losses was up 252% from $9.1 million compared to the same period in 2009.

 

•

Allowance for Loan Losses as a percentage of Total Loans at the end of the third quarter was 2.21%, an increase of 45 basis points from 1.76% on a linked quarter basis. Allowance for Loan Losses as a percentage of Total Loans was up 52 basis points from 1.69% compared to the same period in 2009.

“While the $3.5 million executive transition charges negatively impacted our Operating Expenses in the third quarter, going forward we believe that the transitions will help improve our operating efficiency, which is one of our top priorities. These and other changes to our executive and holding company structure will result in annual cost savings of approximately $4 million,” said David J. Kaye, Chief Financial Officer. “Similarly, the additional Provision for Loan Losses strengthened our Allowance for Loan Losses.”

Total Deposits as of the end of the third quarter increased 3% to $4.5 billion compared to the end of the second quarter of 2010 and were up 8% year-over-year. Total Loans as of the end of the third quarter also increased slightly in the third quarter to $4.5 billion compared to the end of the second quarter of 2010, and were up 5% year-over-year. Residential loans and commercial loans each grew by 2% and 3%, respectively, as of the end of the third quarter compared to the end of the second quarter of 2010.

Non-Performing Loans as a percentage of Total Loans were 3.16% as of the end of the third quarter, an increase of 93 basis points from 2.23% at the end of the second quarter of 2010. Net charge-offs for the quarter were $11.1 million, which represented 0.98% of Total Loans, compared to $9.2 million of net charge-offs during the second quarter of 2010, or 0.82% of Total Loans. Past Due Loans (30-89 days) as a percentage of Total Loans increased 20 basis points, on a linked quarter basis, to 0.37%.

Total Company Assets Under Management (“AUM”) increased during the third quarter of 2010 compared to the second quarter of 2010. Total AUM as of the end of the third quarter was $19.5 billion, an increase of $1.2 billion, or 6%, from $18.3 billion on a linked quarter basis. Total AUM was up 7% on a year-over-year basis. The Company experienced third quarter AUM net inflows of $2 million, as compared to $10 million of net inflows in the prior quarter.

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“Looking ahead, we will continue to focus on core earnings growth,” said Mr. Deutsch. “We plan to capitalize on growth opportunities across our private banks. We will look for continued strong performance at our New England bank, which is the model for our overall private banking strategy through its outstanding client service and approach to building relationships, and will accelerate adoption of this model across our entire banking footprint. In addition, we are seeking stronger growth from our wealth advisors and investment managers as they capitalize on client acquisition and development initiatives. And, we will continue to work on improving expense productivity.”

Dividend Payments

Concurrent with the release of the third quarter 2010 earnings, the Board of Directors of the Company declared a cash dividend to shareholders of $0.01 per share. The record date for this dividend is November 10, 2010 and the payment date is November 24, 2010.

Non-GAAP Financial Measures

The Company uses certain non-GAAP financial measures, such as the TCE/TA ratio and pre-tax, pre-provision income, to provide information for investors to effectively analyze financial trends of ongoing business activities, and to enhance comparability with peers across the financial sector. A detailed reconciliation table of the Company’s GAAP to the non-GAAP measures is attached.

Conference Call

Management will hold a conference call at 9 a.m. Eastern Time on Thursday, October 28, to discuss the financial results in more detail. To access the call:

Dial In #: 866-730-5767

International Dial In #: 857-350-1591

Passcode: 98597604

Replay Information:

Available from Oct. 28 at 12 noon to Nov. 4

Dial In #: 888-286-8010

International Dial In #: 617-801-6888

Passcode: 43172166

The call will be simultaneously webcast and may be accessed on www.bostonprivate.com.

Boston Private Financial Holdings, Inc.

Boston Private Financial Holdings, Inc. (NASDAQ: BPFH) is a national financial services organization comprised of affiliates located in key regions of the U.S. that offer private banking, wealth advisory and investment management services to the high net worth marketplace, selected businesses and institutions. The Company enters demographically attractive markets through selective acquisitions and then expands by way of organic growth. It employs a distinct business strategy, empowering its affiliates to serve their clients at the local level, while at the same time providing strategic oversight and access to resources, both financial and intellectual, to support management, compliance and risk management, legal, marketing, and operations.

For more information about BPFH, visit the Company’s website at www.bostonprivate.com.

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Note to Editors:

Boston Private Financial Holdings, Inc. is not to be confused with Boston Private Bank & Trust Company. Boston Private Bank & Trust Company is a locally operated and wholly-owned subsidiary of BPFH. The information reported in this press release is related to the performance and results of BPFH.

###

CONTACT:

Jeanne Hess

Assistant Vice President, Investor Relations

Boston Private Financial Holdings, Inc.

(617) 912-3798

jhess@bostonprivate.com

John Hartz

Sloane & Company

857-598-4779

jhartz@sloanepr.com

Statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties. These statements, which are based on certain assumptions and describe our future plans, strategies and expectations, include, among others, statements regarding our strategy, effectiveness of our investment programs, and evaluations of future interest rate trends and liquidity, expectations as to growth in assets, deposits and results of operations, receipt of regulatory approval for pending acquisitions, success of acquisitions, future operations, market position, financial position, and prospects, plans and objectives of management. You should not place undue reliance on our forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to significant risks, uncertainties and other factors which are, in some cases, beyond the Company’s control. Forward-looking statements are based on the current assumptions and beliefs of management and are only expectations of future results. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among other factors, adverse conditions in the capital and debt markets and the impact of such conditions on the Company’s private banking, investment management and wealth advisory activities; changes in interest rates; competitive pressures from other financial institutions; the effects of a continuing deterioration in general economic conditions on a national basis or in the local markets in which the Company operates, including changes which adversely affect borrowers’ ability to service and repay our loans; changes in the value of the securities in our investment portfolio, changes in loan defaults and charge-off rates; the adequacy of loan loss reserves; reductions in deposit levels necessitating increased borrowing to fund loans and investments; increasing government regulation, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010; the risk that goodwill and intangibles recorded in the Company’s financial statements will become impaired; and risks related to the identification and implementation of acquisitions; and changes in assumptions used in making such forward looking statements, as well as the other risks and uncertainties detailed in the Company’s Annual Report on Form 10-K, as updated by the Company’s Quarterly Reports on Form 10-Q; and other filings submitted to the Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

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Boston Private Financial Holdings, Inc.

Selected Financial Data (1)

(In Thousands, except share data)

(Unaudited)

 

(In thousands, except per share data)		Sept 30, 2010				Sept 30, 2009				June 30, 2010
FINANCIAL DATA:
Total Balance Sheet Assets (1)		$	6,031,266			$	5,869,589			$	5,867,709
Total Equity			533,762				619,176				540,666
Cash and Investment Securities			1,157,657				1,170,638				1,016,840
Commercial Loans			2,386,378				2,327,291				2,327,240
Construction and Land Loans			210,915				336,756				259,829
Residential Mortgage Loans			1,634,958				1,471,811				1,601,714
Home Equity and Other Consumer Loans			298,023				194,515				297,418
Total Loans			4,530,274				4,330,373				4,486,201
Loans Held for Sale			22,290				18,308				28,449
Other Real Estate Owned (“OREO”)			13,069				16,442				12,113
Deposits			4,492,516				4,141,023				4,380,793
Borrowings			886,741				956,158				839,539
Book Value Per Common Share		$	6.21			$	6.20			$	6.45
Market Price Per Share		$	6.54			$	6.47			$	6.43
ASSETS UNDER MANAGEMENT AND ADVISORY:
Private Banking		$	3,561,000			$	3,421,000			$	3,405,000
Investment Managers			7,521,000				6,972,000				6,880,000
Wealth Advisory			7,553,000				6,928,000				7,210,000
Less: Inter-company Relationship			(18,000	)			(18,000	)			(17,000	)
Consolidated Affiliate Assets Under Management and Advisory		$	18,617,000			$	17,303,000			$	17,478,000
Unconsolidated			840,000				815,000				800,000
Total Unconsolidated Assets Under Management and Advisory		$	19,457,000			$	18,118,000			$	18,278,000
FINANCIAL RATIOS:
Total Equity/Total Assets			8.85	%			10.55	%			9.21	%
Tangible Common Equity/Tangible Assets (2)			6.80	%			6.31	%			7.11	%
Allowance for Loan Losses/Total Loans			2.21	%			1.69	%			1.76	%
Allowance for Loan Losses/Non-Accrual Loans			71	%			85	%			81	%

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Boston Private Financial Holdings, Inc.

Selected Financial Data (1)

(In Thousands, except share data)

(Unaudited)

 

 

		Three Months Ended								Three Months Ended				Nine Months Ended
		Sept 30, 2010				Sept 30, 2009				June 30, 2010				Sept 30, 2010				Sept 30, 2009
OPERATING RESULTS:
Net Interest Income		$	46,444			$	39,717			$	45,017			$	135,772			$	118,428
Investment Management and Trust Fees:
Private Banking			5,599				5,386				5,766				17,081				15,328
Investment Managers			8,712				8,346				9,390				27,260				24,161
Total Investment Management and Trust Fees			14,311				13,732				15,156				44,341				39,489
Total Wealth Advisory Fees			9,525				8,927				9,304				28,087				25,696
Other Private Banking Fees			1,678				1,317				1,370				4,320				4,403
Total Fees			25,514				23,976				25,830				76,748				69,588
Gain on Sale of Loans, net			713				784				500				1,670				4,647
Other Revenue, Gains and (Losses), net (3)			1,072				1,763				(697	)			1,942				9,850
Total Fees and Other Income			27,299				26,523				25,633				80,360				84,085
Total Revenue			73,743				66,240				70,650				216,132				202,513
Provision for Loan Losses			32,050				9,099				14,962				54,627				31,155
Salaries and Employee Benefits			38,662				32,868				34,653				107,164				95,272
Occupancy and Equipment			7,036				6,731				6,696				20,519				19,837
Professional Services			4,857				4,429				4,324				14,025				14,362
FDIC Insurance			2,137				2,619				2,266				6,490				7,734
Other operating expenses (4)			8,287				9,289				8,726				25,480				28,014
Total Operating Expense			60,979				55,936				56,665				173,678				165,219
Income/(Loss) from Continuing Operations, before Tax			(19,286	)			1,205				(977	)			(12,173	)			6,139
Income Tax Expense/(Benefit)			(12,412	)			815				(1,202	)			(11,278	)			1,629
Net Income/(Loss) from Continuing Operations			(6,874	)			390				225				(895	)			4,510
Discontinued Operations, Net of Tax (1)			267				(30,614	)			1,509				1,812				(39,006	)
Net Income/(Loss) before Attribution to Noncontrolling Interest			(6,607	)			(30,224	)			1,734				917				(34,496	)
Less: Net Income Attributable to the Noncontrolling Interest			629				1,136				616				1,929				2,481
Net Income/(Loss) Attributable to the Company		$	(7,236	)		$	(31,360	)		$	1,118			$	(1,012	)		$	(36,977	)

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Boston Private Financial Holdings, Inc.

Selected Financial Data (1)

(In Thousands, except share data)

(Unaudited)

 

 

		Three Months Ended								Three Months Ended				Nine Months Ended
		Sept 30, 2010				Sept 30, 2009				June 30, 2010				Sept 30, 2010				Sept 30, 2009
PER SHARE DATA:
Calculation of Income/(Loss) for EPS:
Net Income/(Loss) from Continuing Operations		$	(6,874	)		$	390			$	225			$	(895	)		$	4,510
Less: Net Income Attributable to Noncontrolling Interests			629				1,136				616				1,929				2,481
Net Income/(Loss) from Continuing Operations Attributable to the Company		$	(7,503	)		$	(746	)		$	(391	)		$	(2,824	)		$	2,029
Adjustments to Net Income/(Loss) Attributable to the Company to Arrive at Net Income/(Loss) Attributable to Common Shareholders (5)			163				(9,852	)			(6,160	)			(9,466	)			(26,357	)
Net Income/(Loss) from Continuing Operations Attributable to the Common Shareholders		$	(7,340	)		$	(10,598	)		$	(6,551	)		$	(12,290	)		$	(24,328	)
Net Income/(Loss) from Discontinued Operations		$	267			$	(30,614	)		$	1,509			$	1,812			$	(39,006	)
Net Income/(Loss) Attributable to the Common Shareholder		$	(7,073	)		$	(41,212	)		$	(5,042	)		$	(10,478	)		$	(63,334	)
Calculation of Average Shares Outstanding:
Weighted Average Basic Shares			74,154				68,552				68,787				70,293				67,034
Weighted Average Diluted Shares			74,154				68,552				68,787				70,293				67,034
Earnings/(Loss) per Share - Basic and Diluted
Earnings/(Loss) per Share from Continuing Operations		$	(0.10	)		$	(0.15	)		$	(0.09	)		$	(0.18	)		$	(0.37	)
Income/(Loss) per Share from Discontinued Operations		$	0.00			$	(0.45	)		$	0.02			$	0.03			$	(0.58	)
Earnings/(Loss) per Share		$	(0.10	)		$	(0.60	)		$	(0.07	)		$	(0.15	)		$	(0.95	)

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Boston Private Financial Holdings, Inc.

Selected Financial Data (1)

(In Thousands, except share data)

(Unaudited)

 

 

AVERAGE BALANCE SHEET:		Average Balance Three Months Ended												Interest Income/Expense Three Months Ended												Average Yield/Rate Three Months Ended
		Sept 30,								June 30,				Sept 30,								June 30,				Sept 30,								June 30,
		2010				2009				2010				2010				2009				2010				2010				2009				2010
AVERAGE ASSETS
Earning Assets
Cash and Investments (6)		$	1,084,506			$	1,125,566			$	1,222,464			$	5,689			$	7,061			$	5,732				2.10	%			2.51	%			1.88	%
Loans (7)
Commercial and Construction (6)			2,587,847				2,708,943				2,605,125				36,481				39,292				35,414				5.56	%			5.75	%			5.41	%
Residential Mortgage			1,637,831				1,385,723				1,563,746				19,621				18,028				19,251				4.79	%			5.20	%			4.92	%
Home Equity and Other Consumer			295,395				210,366				277,473				3,116				2,372				3,842				4.16	%			4.43	%			5.52	%
Total Earning Assets			5,605,579				5,430,598				5,668,808				64,907				66,753				64,239				4.59	%			4.89	%			4.52	%
Allowance for Loan Losses			(81,543	)			(72,815	)			(74,923	)
Cash and due From Banks (Non-Interest Bearing)			27,983				22,325				13,385
Other Assets (1)			443,124				1,873,352				493,339
TOTAL AVERAGE ASSETS		$	5,995,143			$	7,253,460			$	6,100,609
AVERAGE LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-Bearing Liabilities:
Deposits:
Savings and NOW		$	559,413			$	470,852			$	536,905			$	467			$	823			$	515				0.33	%			0.69	%			0.38	%
Money Market			1,698,381				1,236,179				1,653,006				3,821				5,004				3,762				0.89	%			1.61	%			0.91	%
Certificates of Deposits			1,277,670				1,589,505				1,340,825				4,422				9,222				5,104				1.37	%			2.30	%			1.53	%
Total Deposits			3,535,464				3,296,536				3,530,736				8,710				15,049				9,381				0.98	%			1.81	%			1.07	%
Junior Subordinated Debentures and Other Long-term Debt			193,645				239,028				193,645				2,511				3,072				2,504				5.19	%			5.14	%			5.17	%
FHLB Borrowings and Other			614,459				768,985				617,181				5,392				7,184				5,589				3.43	%			3.69	%			3.58	%
Total Interest-Bearing Liabilities			4,343,568				4,304,549				4,341,562				16,613				25,305				17,474				1.51	%			2.33	%			1.61	%
Non-interest Bearing Demand Deposits			986,892				820,082				1,037,556
Payables and Other Liabilities (1)			104,806				1,433,561				106,308
Total Liabilities			5,435,266				6,558,192				5,485,426
Redeemable Non-Controlling Interest			19,542				51,388				20,569
Stockholders’ Equity			540,335				643,880				594,614
TOTAL AVERAGE LIABILITIES & STOCKHOLDERS’ EQUITY		$	5,995,143			$	7,253,460			$	6,100,609
Net Interest Income - on a Fully Taxable Equivalent Basis (FTE)														$	48,294			$	41,448			$	46,765
FTE Adjustment (6)															1,850				1,731				1,748
Net Interest Income (GAAP Basis)														$	46,444			$	39,717			$	45,017
Interest Rate Spread																											3.08	%			2.56	%			2.91	%
Net Interest Margin																											3.42	%			3.04	%			3.29	%

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Boston Private Financial Holdings, Inc.

Selected Financial Data (1)

(In Thousands, except share data)

(Unaudited)

 

 

AVERAGE BALANCE SHEET:		Average Balance								Interest Income/Expense								Average Yield/Rate
		Nine Months Ended								Nine Months Ended								Nine Months Ended
		Sept 30,								Sept 30,								Sept 30,
		2010				2009				2010				2009				2010				2009
AVERAGE ASSETS
Earning Assets
Cash and Investments (6)		$	1,239,698			$	1,030,896			$	17,841			$	23,846				1.92	%			3.14	%
Loans (7)
Commercial and Construction (6)			2,569,262				2,693,669				109,482				116,962				5.59	%			5.78	%
Residential Mortgage			1,572,909				1,342,916				57,758				53,332				4.90	%			5.30	%
Home Equity and Other Consumer			278,313				204,487				9,418				6,821				5.01	%			4.42	%
Total Earning Assets			5,660,182				5,271,968				194,499				200,961				4.56	%			5.09	%
Allowance for Loan Losses			(75,446	)			(69,801	)
Cash and due From Banks (Non-Interest Bearing)			29,658				25,223
Other Assets (1)			500,203				1,956,521
TOTAL AVERAGE ASSETS		$	6,114,597			$	7,183,911
AVERAGE LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-Bearing Liabilities:
Deposits:
Savings and NOW		$	537,323			$	446,317			$	1,575			$	2,512				0.39	%			0.75	%
Money Market			1,666,649				1,132,606				11,504				14,997				0.92	%			1.77	%
Certificates of Deposits			1,361,830				1,505,086				15,642				28,492				1.54	%			2.53	%
Total Deposits			3,565,802				3,084,009				28,721				46,001				1.08	%			1.99	%
Junior Subordinated Debentures and Other Long-term Debt			193,645				250,037				7,505				9,473				5.17	%			5.05	%
FHLB Borrowings and Other			635,764				850,072				17,121				21,717				3.55	%			3.40	%
Total Interest-Bearing Liabilities			4,395,211				4,184,118				53,347				77,191				1.62	%			2.46	%
Non-interest Bearing Demand Deposits			1,011,493				828,918
Payables and Other Liabilities (1)			100,739				1,467,817
Total Liabilities			5,507,443				6,480,853
Redeemable Non-Controlling Interest			20,508				38,650
Stockholders’ Equity			586,646				664,408
TOTAL AVERAGE LIABILITIES & STOCKHOLDERS’ EQUITY		$	6,114,597			$	7,183,911
Net Interest Income - on a FTE Basis										$	141,152			$	123,770
FTE Adjustment (6)											5,380				5,342
Net Interest Income (GAAP Basis)										$	135,772			$	118,428
Interest Rate Spread																			2.94	%			2.63	%
Net Interest Margin																			3.31	%			3.13	%

 

		Three Months Ended								Three Months Ended				Nine Months Ended
		Sept 30,				Sept 30,				June 30,				Sept 30,
		2010				2009				2010				2010				2009
OPERATING RATIOS:
Return on Average Equity			(5.36	%)			(19.48	%)			0.75	%			(0.35	%)			(11.13	%)
Return on Average Assets			(0.48	%)			(1.73	%)			0.07	%			(0.03	%)			(1.03	%)

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Boston Private Financial Holdings, Inc.

Selected Financial Data (1)

(In Thousands, except share data)

(Unaudited)

 

LOAN DATA AND CREDIT QUALITY (8):		Sept 30, 2010				Sept 30, 2009				June 30, 2010
Commercial Loans:
New England		$	1,082,877			$	1,077,227			$	1,048,562
Northern California			935,994				901,496				946,171
Southern California			233,383				233,899				226,215
Pacific Northwest			134,337				115,287				106,607
Eliminations and other, net			(213	)			(618	)			(315	)
Total Commercial Loans		$	2,386,378			$	2,327,291			$	2,327,240
Construction and Land Loans:
New England		$	97,585			$	98,181			$	105,642
Northern California			97,791				182,448				134,153
Southern California			1,869				8,300				3,068
Pacific Northwest			13,670				47,827				16,966
Total Construction and Land Loans		$	210,915			$	336,756			$	259,829
Residential Mortgage Loans:
New England		$	1,154,671			$	1,116,088			$	1,134,756
Northern California			277,321				213,370				262,762
Southern California			159,321				120,175				158,425
Pacific Northwest			43,645				22,178				45,771
Total Residential Mortgage Loans		$	1,634,958			$	1,471,811			$	1,601,714
Home Equity and Other Consumer Loans:
New England		$	201,569			$	96,063			$	197,410
Northern California			72,152				69,502				73,452
Southern California			15,529				20,733				18,078
Pacific Northwest			6,567				4,308				6,206
Eliminations and other, net			2,206				3,909				2,272
Total Home Equity and Other Consumer Loans		$	298,023			$	194,515			$	297,418
Total Loans
New England		$	2,536,702			$	2,387,559			$	2,486,370
Northern California			1,383,258				1,366,816				1,416,538
Southern California			410,102				383,107				405,786
Pacific Northwest			198,219				189,600				175,550
Eliminations and other, net			1,993				3,291				1,957
Total Loans		$	4,530,274			$	4,330,373			$	4,486,201

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Boston Private Financial Holdings, Inc.

Selected Financial Data (1)

(In Thousands, except share data)

(Unaudited)

 

		Sept 30, 2010				Sept 30, 2009				June 30, 2010
Allowance for Loan Losses:
New England		$	30,948			$	27,131			$	28,841
Northern California			49,824				22,146				29,720
Southern California			12,346				11,698				12,822
Pacific Northwest			6,892				12,035				7,690
Total Allowance for Loan Losses		$	100,010			$	73,010			$	79,073
Accruing Classified Loans (9):
New England		$	19,228			$	4,720			$	12,867
Northern California			66,061				6,373				24,723
Southern California			11,467				13,235				11,838
Pacific Northwest			9,308				24,712				11,732
Total Accruing Classified Loans		$	106,064			$	49,040			$	61,160
Non-performing Loans:
New England		$	20,872			$	9,668			$	14,638
Northern California			99,573				42,714				54,397
Southern California (10)			12,585				27,398				17,726
Pacific Northwest			10,060				20,058				13,505
Total Non-performing Loans		$	143,090			$	99,838			$	100,266
Other Real Estate Owned:
New England		$	892			$	740			$	1,050
Northern California			4,283				6,279				3,719
Southern California			4,141				6,439				4,141
Pacific Northwest			3,753				2,984				3,203
Total Other Real Estate Owned		$	13,069			$	16,442			$	12,113
Loans 30-89 Days Past Due:
New England		$	5,515			$	2,185			$	4,474
Northern California			8,270				136				392
Southern California			2,860				5,713				2,628
Pacific Northwest			226				3,321				33
Total Loans 30-89 Days Past Due		$	16,871			$	11,355			$	7,527
Loans Charged-off/(Recovered), Net for the Three Months Ended:
New England		$	393			$	546			$	1,784
Northern California			11,896				130				7,216
Southern California			(1,224	)			2,410				444
Pacific Northwest			48				4,005				(293	)
Total Net Loans Charged-off		$	11,113			$	7,091			$	9,151
Loans Charged-off/(Recovered), Net for the Nine Months Ended:
New England		$	3,215			$	1,938
Northern California			20,901				1,452
Southern California			(1,635	)			7,952
Pacific Northwest			580				10,894
Total Net Loans Charged-off		$	23,061			$	22,236

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Boston Private Financial Holdings, Inc.

Selected Financial Data (1)

(In Thousands, except share data)

(Unaudited)

 

 

(1)	Total Balance Sheet Assets at Sept 30, 2009 includes assets from discontinued operations of $40.2 million.

In 2009, the Company completed the sale of its affiliates Boston Private Value Investors, Sand Hill Advisors, RINET, Gibraltar, and Westfield Capital Management. Accordingly, prior period and current financial information related to the divested companies are included with discontinued operations. Average Other Assets for the three and nine months ended Sept 30, 2009 includes average assets from discontinued operations of $1.5 billion, and $1.6 billion respectively. Average Payables and Other Liabilities for both the three and nine months ended Sept 30, 2009 includes average payables and other liabilities from discontinued operations of $1.4 billion. Prior period AUM, for comparative purposes, was adjusted to exclude the assets managed from the divested companies.

 

(2)

The Company uses certain non-GAAP financial measures, such as the Tangible Common Equity to Tangible Assets ratio, and pre-tax pre-provision income to provide information for investors to effectively analyze financial trends of ongoing business activities, and to enhance comparability with peers across the financial sector.

A reconciliation from the Company’s GAAP Total Equity to Total Assets ratio to the Non-GAAP Tangible Common Equity to Tangible Assets ratio is presented below:

The Company calculates tangible assets by adjusting total assets to exclude goodwill and intangible assets.

The Company calculates tangible common equity by adjusting total equity to exclude: the equity from the TARP funding,

goodwill and intangible assets and includes the difference between redemption value and value per ARB 51 for redeemable non-controlling interests.

 

		Sept 30, 2010				Sept 30, 2009				June 30, 2010
Total Balance Sheet Assets(1)		$	6,031,266			$	5,869,589			$	5,867,709
LESS: Goodwill and Intangible Assets, Net			(146,153	)			(149,134	)			(147,451	)
Tangible Assets (non-GAAP)			5,885,113				5,720,455				5,720,258
Total Equity			533,762				619,176				540,666
LESS: Goodwill and intangible assets, Net			(146,153	)			(149,134	)			(147,451	)
TARP Funding			—				(154,000	)			—
ADD: Difference between redemption value of non-controlling interests and value under ARB 51			12,608				44,963				13,659
Total adjusting items			(133,545	)			(258,171	)			(133,792	)
Tangible Common Equity (non-GAAP)			400,217				361,005				406,874
Total Equity/Total Assets			8.85	%			10.55	%			9.21	%
Tangible Common Equity/Tangible Assets (non-GAAP)			6.80	%			6.31	%			7.11	%

A reconciliation from the Company’s GAAP Income/(Loss) from Continuing Operations, before tax to the Non-GAAP Income/(Loss) Pre-tax, Pre-Provision is presented below:

The Company calculates pre-tax pre-provision income by adding the provision for loan losses to income/(loss) from continuing operations, before tax.

 

		Three Months Ended								Three Months Ended				Nine Months Ended
		Sept 30, 2010				Sept 30, 2009				June 30, 2010				Sept 30, 2010				Sept 30, 2009
Income/(Loss) from Continuing Operations, before Tax			(19,286	)			1,205				(977	)			(12,173	)			6,139
Provision for Loan Losses			32,050				9,099				14,962				54,627				31,155
Income/(Loss) Pre-tax, Pre-Provision			12,764				10,304				13,985				42,454				37,294

 

(3)	Other revenue, gains and (losses), net, as presented in these tables, includes gain on repurchase of debt; gain on sale of investments, net; gain on sale of other real estate owned (OREO), net; and other miscellaneous revenue.

 

(4)	Other operating expenses, as presented in these tables, include expenses related to Marketing and Business Development, Contract Services and Processing, and Amortization of intangibles.

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Boston Private Financial Holdings, Inc.

Selected Financial Data (1)

(In Thousands, except share data)

(Unaudited)

 

 

(5)

Adjustments to net income attributable to the Company to arrive at net loss attributable to common shareholders, as presented in these tables, include Decrease/ (Increase) in Noncontrolling Interests Redemption Value; Dividends on Preferred Securities; Accretion of Discount on Series C Preferred Stock; and Accretion of Series B Preferred Stock Beneficial Conversion Feature.

 

(6)	Interest income on non-taxable investments and loans are presented on an FTE basis using the federal statutory rate.

 

(7)	Includes loans held for sale and non-accrual loans.

 

(8)

The concentration of the Private Banking loan data and credit quality is based on the location of the lender. Net loans from the Holding Company to certain principals of the Company’s affiliate partners, loans at the Company’s non-banking segments, and inter-company loan eliminations are identified as “Eliminations and other, net”.

 

(9)

Accruing classified loans include loans that are classified as substandard but are still accruing interest income. The Banks may classify a loan as substandard where known information about possible credit problems of the related borrowers causes management to have doubts as to the ability of such borrowers to comply with the present repayment terms and which may result in disclosure of such loans as nonperforming at some time in the future.

 

(10)	Includes the non-strategic loans held for sale of $2.9 million, $13.8 million, and $3.0 million, at Sept 30, 2010, Sept 30, 2009 and June 30, 2010, respectively.