EX:  99.1

FOR IMMEDIATE RELEASE

Cambridge Bancorp Announces First Quarter 2021 Earnings and Increases Quarterly Dividend by 11%

CAMBRIDGE, MA. (April 21, 2021) - Cambridge Bancorp (NASDAQ: CATC) (the “Company”), the parent company of Cambridge Trust Company (the “Bank”), today announced unaudited net income of $13,499,000 for the quarter ended March 31, 2021, an increase of $485,000, or 3.7%, as compared to net income of $13,014,000 for the quarter ended December 31, 2020. Diluted earnings per share were $1.92 for the first quarter of 2021, representing a 3.4% increase over diluted earnings per share of $1.86 for the quarter ended December 31, 2020.

First quarter 2021 highlights:

“The Cambridge Trust team continued to deliver support for our clients and our communities including participating in the second round of the PPP” noted Denis K. Sheahan, Chairman and CEO. “Financial performance in the first quarter remained strong and I am pleased to see strength in deposit growth, loan asset quality, and new business pipelines. I am also pleased to report a significant increase of 11% in the Company’s quarterly common stock dividend.”

Balance Sheet

Total assets increased by $303.9 million, or 7.7%, from $3.95 billion at December 31, 2020 and were $4.25 billion at March 31, 2021.

Total loans increased by $26.7 million, or 0.8%, from December 31, 2020 and amounted to $3.18 billion at March 31, 2021.

Excluding PPP loans, total loans were lower by $14.8 million, or 0.5%, from December 31, 2020.

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The Company’s total investment securities portfolio increased by $140.1 million, or 28.9%, from $484.7 million at December 31, 2020 to $624.8 million at March 31, 2021 as the Company partially invested excess cash.

Total deposits increased by $327.0 million, or 9.6%, to $3.73 billion at March 31, 2021 from $3.40 billion at December 31, 2020.

Net Interest and Dividend Income

For the quarter ended March 31, 2021, net interest and dividend income before the provision for loan losses decreased by $2.7 million, or 7.8%, to $31.4 million, as compared to $34.1 million for the quarter ended December 31, 2020.

This change was primarily due to less loan accretion associated with merger accounting and a decrease in deferred PPP loan income recognized on associated PPP loans forgiven by the SBA during the quarter. These decreases were partially offset by a lower cost of funds and higher average interest earning balances during the period.

The Company’s net interest margin, on a fully taxable equivalent basis, decreased 32 basis points to 3.35% for the quarter ended March 31, 2021, as compared to 3.67% for the quarter ended December 31, 2020.

In order to provide greater disclosure of the impact of loan related merger accounting and the impact of the SBA’s PPP loan program, a reconciliation of the Company’s net interest margin, on a fully taxable equivalent basis, to an adjusted net interest margin, on a fully taxable equivalent basis, is shown below. Excluding the impact of merger-related loan accretion and the impact of PPP loans, the adjusted net interest margin for the quarter ended March 31, 2021 was 3.16%, representing a 11 basis points decrease over the quarter ended December 31, 2020’s adjusted net interest margin of 3.27%.

(1) Excess cash represents the estimated amount of average cash on the balance sheet that is above normal levels.

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Provision for Credit Losses

During the three months ended March 31, 2021, the Company decreased its allowance for credit losses by recording a $206,000 release due to lower loan balances, excluding PPP loans, and changes in assumptions associated with economic factors and qualitative factors utilized within our methodology.

Noninterest Income

Total noninterest income remained consistent at $10.8 million for both quarters ended March 31, 2021 and December 31, 2020, with increases in wealth management revenue and loan related derivative income, partially offset by lower other income. Noninterest income was 25.7% of total revenue for the quarter ended March 31, 2021.

Noninterest Expense

Total noninterest expense decreased by $2.9 million, or 10.7%, to $24.2 million for the quarter ended March 31, 2021, as compared to $27.1 million for the quarter ended December 31, 2020, primarily driven by decreases in nonoperating expenses, salaries and employee benefits expense, and marketing expense.

Asset Quality

Non-performing loans totaled $7.4 million, or 0.23% of total loans outstanding at March 31, 2021. The allowance for credit losses was $35.6 million, or 1.18% of total loans outstanding excluding PPP loans at March 31, 2021, as compared to $36.0 million, or 1.19% of total loans outstanding excluding PPP loans at December 31, 2020.

The Company currently holds $1.8 million in real estate owned property, comprised of two properties, both of which are currently under agreement to be sold.

The Company recorded net loan recoveries of $20,000 for the quarter ended March 31, 2021, as compared to net loan recoveries of $174,000, or 0.02% of total loans (annualized), for the quarter ended December 31, 2020.

The following table shows additional and historical information regarding nonperforming assets, early-stage delinquency (30-89 days delinquent), and troubled debt restructurings:

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Forbearance/Modifications

The Company instituted payment deferral programs to aid existing borrowers with payment forbearance. For commercial and consumer borrowers, we have endeavored to provide payment relief for those who have been impacted by the COVID-19 pandemic and have requested payment assistance. The Company had 45 loans totaling $37.5 million on deferral, or 1.2% of total loans outstanding at March 31, 2021.  

Income Taxes

The Company’s effective tax rate was 26.0% for the quarter ended March 31, 2021, as compared to 27.2% for the quarter ended December 31, 2020.

Dividend & Capital

On April 20, 2021, the Company’s Board of Directors declared a quarterly cash dividend of $0.61 per share, which is payable on May 20, 2021, to shareholders of record as of the close of business on May 6, 2021.  This represents an increase of $0.06 per share, or 11%, as compared to the $0.55 per share dividend paid in the first quarter of 2021.

The Company’s total shareholders’ equity to total assets ratio decreased by 58 basis points to 9.59% at March 31, 2021, as compared to 10.17% at December 31, 2020. Book value per share grew by $0.57, or 1.0%, to $58.57 at March 31, 2021, as compared to $58.00 at December 31, 2020.

The Company’s ratio of tangible common equity to tangible assets decreased to 8.41% at March 31, 2021 from 8.91% at December 31, 2020, primarily due to balance sheet growth and fair value changes. Tangible common equity to tangible assets, excluding PPP loans, decreased to 8.75% at March 31, 2021, as compared to 9.20% at December 31, 2020. Tangible book value per share grew by $0.63, or 1.3%, to $50.70 at March 31, 2021, as compared to $50.07 at December 31, 2020.  

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Investor Presentation:

An investor presentation is available on our investor relations website: ir.cambridgetrust.com or within the hyperlink provided below.  This presentation includes additional detail regarding the Company’s loan portfolio, liquidity position, and other financial disclosures.  Click here to download.

About Cambridge Bancorp

Cambridge Bancorp, the parent company of Cambridge Trust Company, is based in Cambridge, Massachusetts. Cambridge Trust Company is a 130-year-old Massachusetts chartered commercial bank with approximately $4.25 billion in assets at March 31, 2021, and a total of 21 Massachusetts and New Hampshire locations. Cambridge Trust Company is one of New England’s leaders in private banking and wealth management with $4.27 billion in client assets under management and administration at March 31, 2021. The Wealth Management group maintains offices in Boston and Wellesley, Massachusetts and Concord, Manchester, and Portsmouth, New Hampshire.

The accompanying unaudited consolidated interim financial information should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K, which is posted in the investor relations section of the Company’s website at www.cambridgetrust.com.

Forward-looking Statements

Certain statements herein may constitute “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements about the Company and its industry involve substantial risks and uncertainties. Statements other than statements of current or historical fact, including statements regarding the Company’s future financial condition, results of operations, business plans, liquidity, cash flows, projected costs, the impact of any laws or regulations applicable to the Company, and measures being taken in response to the COVID-19 pandemic and the impact of the COVID-19 pandemic on the Company’s business are forward-looking statements. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “projects,” “may,” “will,” “should,” and other similar expressions are intended to identify these forward-looking statements. Such statements are subject to factors that could cause actual results to differ materially from anticipated results. Such factors include, but are not limited to, the following: the current global economic uncertainty and economic conditions being less favorable than expected, disruptions to the credit and financial markets, changes in the Company’s accounting policies or in accounting standards, weakness in the real estate market, legislative, regulatory or accounting changes that adversely affect the Company’s business and/or competitive position, the Dodd-Frank Act’s consumer protection regulations, the duration and scope of the COVID-19 pandemic and its impact on levels of consumer confidence, actions governments, businesses and individuals take in response to the COVID-19 pandemic, the impact of the COVID-19 pandemic and actions taken in response to the pandemic on global and regional economies and economic activity, the pace of recovery when the COVID-19 pandemic subsides, challenges from the integration of the Company and Optima Bank & Trust Company and Wellesley Bancorp Inc. (“Wellesley”)resulting in the combined business not operating as effectively as expected, disruptions in the Company’s ability to access the capital markets, the cost savings of the merger with Wellesley may not be fully realized or may take longer to realize than expected, operating costs, customer loss and business disruption following the merger with Wellesley, including adverse effects on relationships with employees, may be greater than expected, and other factors that are described in the Company’s filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the year end December 31, 2020, which the Company filed on March 15, 2021. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. You are cautioned not to place undue reliance on these forward-looking statements.

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Non-GAAP Measures

This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). This information includes operating net income and operating diluted earnings per share, tangible book value per share and the tangible common equity ratio (including and excluding PPP loans), operating return on average assets, operating return on tangible common equity, operating efficiency ratio, and operating pre-tax pre-provision income and return on average assets.

Operating net income and operating diluted earnings per share exclude items that management believes are unrelated to its core banking business such as merger, acquisition, and capital raise expenses, gain (loss) on disposition of investment securities, and other items. The Company’s management uses operating net income and operating diluted earnings per share to measure the strength of the Company’s core banking business and to identify trends that may to some extent be obscured by such excluded gains or losses.

Management also supplements its evaluation of financial performance with analysis of tangible book value per share (which is computed by dividing shareholders’ equity less goodwill and acquisition related intangible assets, or “tangible common equity,” by common shares outstanding), the tangible common equity ratio (which is computed by dividing tangible common equity by tangible assets, defined as total assets less goodwill and acquisition related intangibles), return on average assets and return on tangible common equity on an operating basis, the operating efficiency ratio (which is computed by dividing noninterest expense adjusted for nonoperating expenses and total revenue adjusted for gain/(loss) on disposition of investment securities), operating pre-tax pre-provision income over average assets (which is computed by dividing income before taxes adjusted by provision (release) for credit losses, non-operating expenses, and gain/(loss) on disposition of investment securities over average assets). The Company has included information on these non-GAAP financial measures because the Company believes that investors may find it useful to have access to the same analytical tool used by management. As a result of merger and acquisition activity, the Company has recognized goodwill and other intangible assets in conjunction with business combination accounting principles. Excluding the impact of goodwill and other intangibles in measuring asset and capital values for the ratios provided, along with other bank standard capital ratios, provides a framework to compare the capital adequacy of the Company to other companies in the financial services industry.

These non-GAAP measures should not be viewed as a substitute for operating results and other financial measures determined in accordance with GAAP. An item which management deems to be nonoperating and excludes when computing these non-GAAP measures can be of substantial importance to the Company’s results for any particular quarter or year. The Company’s non-GAAP performance measures are not necessarily comparable to non-GAAP performance measures which may be presented by other companies.

Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are presented under “GAAP to Non-GAAP Reconciliations.”

CONTACT:

Cambridge Bancorp

Michael F. Carotenuto

Chief Financial Officer

617-520-5520

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CAMBRIDGE BANCORP AND SUBSIDIARIES

UNAUDITED QUARTERLY RESULTS

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CAMBRIDGE BANCORP AND SUBSIDIARIES

UNAUDITED CONSOLIDATED BALANCE SHEETS

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CAMBRIDGE BANCORP AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

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CAMBRIDGE BANCORP AND SUBSIDIARIES

MARGIN & YIELD ANALYSIS

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GAAP to Non-GAAP Reconciliations (dollars in thousands except per share data)

Statement on Non-GAAP Measures: The Company believes the presentation of the following non-GAAP financial measures provides useful supplemental information that is essential to an investor’s proper understanding of the results of operations and financial condition of the Company. Management uses non-GAAP financial measures in its analysis of the Company’s performance. These non-GAAP measures should not be viewed as substitutes for the financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.