Hampden Bancorp, Inc. CEO Interview: Thomas R. Burton

• On 3:13 pm EDT, Tuesday October 6, 2009

67 WALL STREET, New York - October 6, 2009 - The Wall Street Transcript has just published its Northeast and Mid-Atlantic Regional Banks Report offering a timely review of the sector to serious investors and industry executives. This 130 page feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Residential Mortgage Situation -- Regional Banks Mergers and Acquisitions Timing Strategy -- Commercial Mortgage Portfolio Decay -- Timing Of Commercial Mortgage Portfolio Bad Debt Write Offs-- FDIC Hit List For Bank Closings -- Mutual Holding Company Structure -- Interest Rate Scenarios -- Banking Pricing Power -- Expensive Bank Valuations -- Tangible Book As Guide For Bank Stock Pricing -- Distressed Sales Of Community and Regional Banks -- TARP Program -- Attitude Of Institutional Investors Towards Resurgence in Community Banking -- Unique Business Models -- Regional Bank Boards Looking For Exit

Companies include: BB and T (BBT); Colonial (CNB); First Niagara (FNFG); PNC (PNC); National City (NCC-PA); Harleysville National (HNBC); Citizens First Bancorp (CTZN); Regions Financial (RF); Bank of America (BAC); SunTrust Banks (STI); Pinnacle Financial (PNFP); Northwest Bancorp Inc. (NWSB); Beneficial (BNCL); Investor Savings Bancorp (ISBC); Territorial Bancorp (TBNK); FNB Bancorp (FNBG.OB); National Penn (NPBC); Trustco Bank (TRST); KeyBank (KEY); M and T Bank (MTB); New York Community Bancorp (NYB); Bank of New York Mellon (BK); Wells Fargo and Company (WFC); JPMorgan Chase and Co. (JPM); Wachovia (WB); Harleysville Savings Bank (HARL); SVB Financial (SIVB); Signature Bank (SBNY); Provident Bank (PBKS); Valley National Bank (VLY); Community Bank System (CBU); NBT Bankcorp (NBTB); Fulton (FULT); Citibank ©; Allied Irish (AIB); Bank of Hawaii (BOH); First Horizon Bank (FHN); Comerica (CMA); Synovus (SNV); Zions (ZION); South Financial Group (TSFG); Bancorp (TBBK); Legg Mason (LM); IBERIABANK Corp. (IBKC); Wilmington Trust (WL); S and T Bancorp (STBA); PHH (PHH); Goldman Sachs (GS); Citigroup ©; U.S. Bancorp (USB); Fifth Third Bancorp (FITB); KeyCorp (KEY); Lehman Brothers; Colonial; Washington Mutual; TD Banknorth (TD), Lakeland (LBAI), Westfield Financial, Inc. (WFD), United Financial Bancorp, Inc. (UBNK), Chicopee Bancorp, Inc. (CBNK)

In the following brief excerpt from the 130 page, Thomas R. Burton, CEO of Hampden Bancorp, Inc., discusses the outlook for the sector and for investors.

Thomas R. Burton, CPA, is President and CEO of Hampden Bancorp, Inc. Upon graduation from Western New England College, Mr. Burton entered the accounting profession working for KMG Main Hurdman, which merged with Peat Marwick in 1986 to become KPMG, LLP. Mr. Burton became Managing Partner of the Springfield Office of KPMG, and also served as an SEC reviewing partner and engagement partner for 25 financial institution clients in New England, ranging from $100 million to over $4 billion in size and including publicly traded technology-based manufacturing companies. His experience included significant work in the area of mergers and acquisitions, the conversion of mutual banks to publicly traded institutions and FDIC-assisted transactions.

TWST: Let's begin with a brief introduction and short history on Hampden Bank.

Mr. Burton: Hampden Bank was founded in 1852 as a mutual savings bank for one specific reason - to serve the needs of the workers of the Western Railroad whose labors were rapidly bringing Springfield into the industrial age as a manufacturing and transportation hub. Back then the mutual was a common structure throughout New England and nearly every community had its own bank. I came here at the end of 1993, when the bank was about $150 million in assets. As a traditional thrift, it had mostly home mortgages and fixed income investments for assets and typical thrift deposits, mostly CDs on the liability side. The bond market crashed in early 1994, so we began diversifying our asset base into commercial lending, grew the bank and by 2005 came to the conclusion that we've been so successful in growing the bank that we needed more capital. After investigating various capital-raising alternatives, we made a decision to go public, closed the transaction with $75 million of additional capital in January of 2007 and became listed on NASDAQ. Since that time, we continued to grow the bank with more than enough capital during a period when capital was king. Ultimately, the timing was fortuitous.

TWST: What are the key factors that differentiate Hampden from its competition? Is it your business focus, geography, the quality of your assets? What might some of those factors be?

Mr. Burton: We epitomize the definition of "community bank." We have a diverse loan portfolio divided between commercial loans, residential mortgages and consumer loans. We focus on providing extraordinary service, competitive pricing and quality products, and we're dedicated toward optimizing all delivery channels for the convenience of our customers. Although not totally measurable, the fact that our people are totally engaged and accessible in the communities we serve does indeed differentiate us. Geographically our market encompasses all of Hampden County and northern Connecticut with a primary focus on Greater Springfield and its surrounding communities.

TWST: What is the financial snapshot, the balance sheet, P&L, asset levels of the company?

Mr. Burton: Our year-end is June 30, so we just finished off the year. We closed at $568 million in assets. During the past year, we've reduced our borrowings with the Federal Home Loan Bank, as well as some investments. We have plenty of liquidity. Deposit growth has been extraordinary. We had one of our best years for deposit growth, about $50 million. That encompasses all areas of deposits from demand deposits to money market accounts and some CDs. As to profitability, we made money, but we didn't make much. We had a bottom line profit of about $286,000. There were three basic issues that constrained profitability. Provisions for loan losses were larger than we had expected. We had some other-than-temporary impairment issues, about $300,000 of equities that we wrote down and, of course, our FDIC insurance premiums and a special assessment that we booked in May of this year of $240,000. Those three things really hit our bottom line, but we were fortunate to at least make a small profit.

The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 130 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online .

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