Independent Bank Corp. Reports Third Quarter Net Income of $6.8 Million

Solid Commercial Loan Growth and Expanded Net Interest Margin Drive Performance

• Press Release
• Source: Independent Bank Corp.
• On 4:03 pm EDT, Thursday October 22, 2009

ROCKLAND, Mass.--(BUSINESS WIRE)--Independent Bank Corp., (NASDAQ: INDB - News), parent of Rockland Trust Company, today announced net income of $6.8 million for the third quarter of 2009. This compares favorably with net income of $660,000 for the second quarter of 2009 in which the Company had large merger and acquisition expenses associated with the Benjamin Franklin Bancorp. Inc acquisition and a special FDIC deposit insurance premium fee. The strong increase in third quarter net income was reduced by other-than-temporary securities impairment charges on certain pooled trust preferred securities amounting to $5.1 million pre-tax, or $0.16 per diluted share, recorded in the current period.

On a diluted earnings per share basis, the Company reported earnings of $0.33 for the quarter as compared to a loss of ($0.19) for the previous quarter period. The Company’s repayment of the United States Treasury Department’s Capital Purchase Program preferred stock resulted in a one-time $4.4 million deemed dividend charge, which decreased net income available to common shareholders by $0.22 per diluted share, negatively impacting the second quarter’s performance.

Christopher Oddleifson, President and Chief Executive Officer, stated, “Rockland Trust had an outstanding third quarter despite very difficult economic conditions. While many financial services companies have considerably curtailed their lending activity, our disciplined commercial and home equity lending continues to drive strong growth for the Company. Our solid capital foundation continues to allow us to invest in the businesses and communities in which we operate. I’m also happy to report that we have fully integrated the former Benjamin Franklin franchise, and are looking forward to further increasing business with those customers in this new geographic territory for Rockland Trust.”

BALANCE SHEET

Total assets decreased by $21.1 million, or (0.5%), to $4.4 billion at September 30, 2009 as compared to June 30, 2009.

Total loans were $3.4 billion at September 30, 2009, an increase of $34.4 million, or 1.0% from the prior quarter. The Company continued to generate solid growth in the commercial and home equity loan portfolios with annualized growth of 11.7% and 7.7%, respectively. This was offset by a decline in the residential real estate and other consumer lending categories.

Total deposits decreased by $44.0 million, or (1.3%), during the quarter ending September 30, 2009, primarily due to decreases in municipal deposits and non-core time deposits. The Company continued its focus on core deposits, which represented 71.4% of total deposits at September 30, 2009.

Stockholders’ equity at September 30, 2009 totaled $406.6 million as compared to $397.6 million at June 30, 2009. The Tier 1 leverage capital ratio at September 30, 2009 was 7.66%, maintaining the Company’s well-capitalized position.

NET INTEREST INCOME

Comparing the quarter ended September 30, 2009 to the quarter ended June 30, 2009, net interest income increased $1.8 million, or 4.6%, attributable to an expanded net interest margin. The net interest margin for the period was 4.05% compared to 3.88% in the prior period.

NON-INTEREST INCOME

The Company recorded non-interest income of $4.5 million during the third quarter of 2009, a decrease of $8.8 million when compared to the quarter ended June 30, 2009. The change in non-interest income is composed of the following:

• Service charges on deposit accounts increased by $355,000, or 8.3%.
• Wealth management revenue decreased by $432,000, or (15.9%), as second quarter revenue included a seasonal increase related to tax preparation services. Assets under management in the wealth management division were $1.2 billion at September 30, 2009.
• Mortgage banking income decreased by $1.6 million, or (78.7%), due to a decline in mortgage originations and a charge to the servicing asset, reflecting refinancing activity. The balance of the mortgage servicing asset was $2.2 million and $2.7 million at September 30, 2009 and June 30, 2009, respectively, and loans serviced amounted to $366.6 million and $380.9 million, respectively.
• During the third quarter of 2009, there were no gains or losses on the sale of securities or derivatives. During the second quarter of 2009, the Company recorded a $3.8 million gain, associated with the unwinding of certain borrowings and their associated hedge positions as a result of strong balance sheet liquidity.
• The Company deemed certain pooled trust preferred securities and one private mortgage-backed security to be other-than-temporarily impaired (“OTTI”) during the third quarter. The Company recorded total credit related impairment charges through earnings of $5.1 million and $1.7 million, pre-tax, for the quarters ending September 30, 2009 and June 30, 2009, respectively. The table below shows the remaining book value of pooled and single issuer trust preferred securities and private mortgage-backed securities as of September 30, 2009:

														Total Credit
			Amortized		Unrealized			Non-Credit			Fair			Related
As of September 30, 2009			Cost*		Loss			OTTI			Value			Impairment
			(Dollars in thousands)
Pooled Trust Preferred Securities
A Tranche			$	2,844		($1,171	)	$	-		$	1,673		$	-
B Tranche				1,887		(1,231	)		-			656			-
C Tranche				6,133		-			(5,656	)		477			(3,261	)
D Tranche				-		-			-			-			(4,471	)
Total Pooled Trust Preferred Securities				10,864		(2,402	)		(5,656	)		2,806			(7,732	)
Single Issuer Trust Preferred Securities - AFS				5,000		(1,858	)		-			3,142			-
Single Issuer Trust Preferred Securities - HTM				9,780		(806	)		-			8,974			-
Private Mortgage-Backed Securities				16,593		(811	)		(908	)		14,874			(298	)
			$	42,237	$	(5,877	)	$	(6,564	)	$	29,795		$	(8,030	)
			*Amortized cost reflects all credit related impairment through September 30, 2009.

• Other non-interest income increased by $102,000 or 6.9%.

NON-INTEREST EXPENSE

The Company recorded non-interest expense of $32.3 million in the third quarter of 2009, a decrease of $14.3 million, or (30.6%), when compared to the quarter ended June 30, 2009. Significant changes of non-interest expense include the following:

• Salaries and employee benefits increased by $593,000, or 3.5%, primarily attributable to annual salary increases and increased medical and pension expense.
• Occupancy and equipment expense decreased by $151,000, or (3.7%).
• The Company recorded merger and acquisition expenses associated with the Benjamin Franklin Bancorp. Inc. acquisition of $41,000 and $10.8 million for the quarters ended September 30, 2009 and June 30, 2009, respectively.
• FDIC deposit insurance fees decreased by $2.6 million, as the Company recorded a $2.1 million special assessment imposed to replenish the Deposit Insurance Fund during the second quarter of 2009.
• Other non-interest expense decreased by $1.3 million, or (14.3%), which is primarily attributable to the timing of advertising campaigns and a reduction in other losses and charge-offs.

The Company reported a return on average assets and a return on average common equity in the third quarter of 2009 of 0.62% and 6.73%, respectively, as compared to (0.35%) and (3.95%) for the quarter ended June 30, 2009.

ASSET QUALITY

The allowance for loan losses increased to $41.4 million at September 30, 2009 as compared to $40.1 million at June 30, 2009. Nonperforming loans totaled $36.9 million, or 1.09% of total loans at September 30, 2009, as compared to $31.5 million, or 0.94% of total loans at June 30, 2009. The increase in non-performing loans was driven by the commercial real estate category which increased $6.0 million from prior quarter and was primarily due to one relationship. The Company’s allowance for loan losses as a percentage of loans was 1.22% and 1.19% at September 30, 2009 and June 30, 2009, respectively. These ratios are inclusive of loans acquired at fair value.

The provision for loan losses was $4.4 million and $4.5 million for the quarters ended September 30, 2009 and June 30, 2009, respectively. Net charge-offs were $3.2 million and $1.9 million for the quarters ending September 30, 2009 and June 30, 2009, respectively.

Christopher Oddleifson and Denis K. Sheahan, Chief Financial Officer, of Independent Bank Corp. and Rockland Trust Company, will host a conference call to discuss third quarter earnings at 10:00 a.m. Eastern Time on Friday, October 23, 2009. Internet access to the call is available on the Company’s website at www.RocklandTrust.com or by telephonic access by dial-in at 1-800-860-2442 reference: INDB. A replay of the call will be available by calling 1-877-344-7529, Replay Passcode: 434060. The web cast replay will be available until October 23, 2010 and the telephone replay will be available until November 6, 2009.

Independent Bank Corp., which has Rockland Trust Company as a wholly-owned bank subsidiary, has more than $4.4 billion in assets. Rockland Trust offers a wide range of commercial banking products and services, retail banking products and services, business and consumer loans, insurance products and services, and investment management services. To discover why Rockland Trust is the bank Where Each Relationship Matters^®, visit www.RocklandTrust.com.

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.

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”). Operating earnings, which is a non-GAAP financial measure, excludes gain or loss due to items that management does not believe are related to its core banking business, such as gains or losses on the sales of securities, merger and acquisition expenses, and other items. The Company’s management uses operating earnings to measure the strength of the Company’s core banking business and to identify trends that may to some extent be obscured by gains or losses which management deems not to be core to the Company’s operations. The Company has included information on operating earnings because management believes that investors may find it useful to have access to the same analytical tool used by management and may also find that it facilitates the comparison of the Company to other companies in the financial services industry. Non-GAAP operating earnings should not be viewed as a substitute for operating results determined in accordance with GAAP. An item which management deems to be non-core and excludes when computing non-GAAP operating earnings can be of substantial importance to the Company’s results for any particular quarter or year. The Company’s non-GAAP operating earnings are not necessarily comparable to non-GAAP performance measures which may be presented by other companies.

INDEPENDENT BANK CORP. FINANCIAL SUMMARY
(Unaudited - Dollars in Thousands)
																% Change				% Change
CONSOLIDATED BALANCE SHEETS				September 30,				June 30,				September 30,				Sept. 2009 vs.				Sept. 2009 vs.
				2009				2009				2008				June 2009				Sept. 2008
Assets
Cash and Due From Banks				$	65,514			$	75,905			$	92,752				-13.69	%			-29.37	%
Fed Funds Sold and Short Term Investments					-				6,159				100				-100.00	%			-100.00	%
Securities
Trading Assets					23,090				22,926				3,048				0.72	%			657.55	%
Securities Available for Sale					546,125				581,241				499,879				-6.04	%			9.25	%
Securities Held to Maturity					83,063				70,241				33,354				18.25	%			149.03	%
Total Securities					652,278				674,408				536,281				-3.28	%			21.63	%
Loans Held for Sale				14,160				24,866				5,511				-43.05		%		156.94		%
Loans
Commercial and Industrial					371,092				364,570				250,469				1.79	%			48.16	%
Commercial Real Estate					1,546,206				1,482,321				1,092,811				4.31	%			41.49	%
Commercial Construction					201,196				206,569				150,615				-2.60	%			33.58	%
Small Business					84,135				86,378				85,120				-2.60	%			-1.16	%
Total Commercial					2,202,629				2,139,838				1,579,015				2.93	%			39.49	%
Residential Real Estate					576,575				599,166				420,809				-3.77	%			37.02	%
Residential Construction					14,783				15,323				12,868				-3.52	%			14.88	%
Total Residential					591,358				614,489				433,677				-3.76	%			36.36	%
Consumer - Home Equity					467,213				458,435				391,416				1.91	%			19.36	%
Consumer - Auto					92,093				105,064				134,866				-12.35	%			-31.72	%
Consumer - Other					34,246				35,314				41,073				-3.02	%			-16.62	%
Total Consumer					593,552				598,813				567,355				-0.88	%			4.62	%
Total Loans					3,387,539				3,353,140				2,580,047				1.03	%			31.30	%
Less - Allowance for Loan Losses					(41,357	)			(40,068	)			(33,287	)			3.22	%			24.24	%
Net Loans					3,346,182				3,313,072				2,546,760				1.00	%			31.39	%
Federal Home Loan Bank Stock					36,357				36,357				24,603				0.00	%			47.77	%
Bank Premises and Equipment					41,963				42,145				35,246				-0.43	%			19.06	%
Goodwill and Core Deposit Intangible					144,152				144,865				126,412				-0.49	%			14.03	%
Other Assets					133,397				137,282				109,570				-2.83	%			21.75	%
Total Assets				$	4,434,003			$	4,455,059			$	3,477,235				-0.47	%			27.52	%
Liabilities and Stockholders' Equity
Deposits
Demand Deposits				$	702,159			$	699,173			$	573,904				0.43	%			22.35	%
Savings and Interest Checking Accounts					965,694				987,202				711,862				-2.18	%			35.66	%
Money Market					675,269				667,665				464,983				1.14	%			45.22	%
Time Certificates of Deposit					937,854				970,903				787,282				-3.40	%			19.13	%
Total Deposits					3,280,976				3,324,943				2,538,031				-1.32	%			29.27	%
Borrowings
Federal Home Loan Bank Borrowings					396,218				392,968				336,792				0.83	%			17.64	%
Fed Funds Purchased and Assets Sold
Under Repurchase Agreements					188,707				179,317				166,417				5.24	%			13.39	%
Junior Subordinated Debentures					61,857				61,857				61,857				0.00	%			0.00	%
Subordinated Debentures					30,000				30,000				30,000				0.00	%			0.00	%
Other Borrowings					2,418				3,772				2,103				-35.90	%			14.98	%
Total Borrowings					679,200				667,914				597,169				1.69	%			13.74	%
Total Deposits and Borrowings					3,960,176				3,992,857				3,135,200				-0.82	%			26.31	%
Other Liabilities					67,252				64,642				37,295				4.04	%			80.32	%
Stockholders' Equity
Common Stock					209				209				163				0.00	%			28.22	%
Additional Paid in Capital					224,848				224,594				137,347				0.11	%			63.71	%
Retained Earnings					179,245				176,012				177,338				1.84	%			1.08	%
Accumulated Other Comprehensive Income/(Loss), Net of Tax					2,273				(3,255	)			(10,108	)			-169.83	%			-122.49	%
Total Stockholders' Equity					406,575				397,560				304,740				2.27	%			33.42	%
Total Liabilities and Stockholders' Equity				$	4,434,003			$	4,455,059			$	3,477,235				-0.47	%			27.52	%
INDEPENDENT BANK CORP. FINANCIAL SUMMARY
(Unaudited - Dollars in Thousands, Except Per Share Data)
CONSOLIDATED STATEMENTS OF INCOME				Three Months Ended
																% Change				% Change
				September 30,				June 30,				September 30,				Sept. 2009 vs.				Sept. 2009 vs.
				2009				2009				2008				June 2009				Sept. 2008
INTEREST INCOME
Interest on Fed Funds Sold and Short Term Investments				$	4			$	70			$	62				-94.29	%			-93.55	%
Interest and Dividends on Securities					7,644				7,636				5,822				0.10	%			31.30	%
Interest on Loans					45,773				44,938				39,143				1.86	%			16.94	%
Interest on Loans Held for Sale					169				162				58				4.32	%			191.38	%
Total Interest Income					53,590				52,806				45,085				1.48	%			18.86	%
INTEREST EXPENSE
Interest on Deposits					7,446				8,441				9,078				-11.79	%			-17.98	%
Interest on Borrowed Funds					5,236				5,265				5,079				-0.55	%			3.09	%
Total Interest Expense					12,682				13,706				14,157				-7.47	%			-10.42	%
Net Interest Income					40,908				39,100				30,928				4.62	%			32.27	%
Less - Provision for Loan Losses					4,443				4,468				2,068				-0.56	%			114.85	%
Net Interest Income after Provision for Loan Losses					36,465				34,632				28,860				5.29	%			26.35	%
NON-INTEREST INCOME
Service Charges on Deposit Accounts					4,613				4,258				4,083				8.34	%			12.98	%
Wealth Management					2,278				2,710				2,764				-15.94	%			-17.58	%
Mortgage Banking Income					425				1,996				501				-78.71	%			-15.17	%
BOLI Income					713				683				659				4.39	%			8.19	%
Net Gain/(Loss) on Sale of Securities					-				(25	)			-				-100.00	%			n/a
Gain Resulting From early Termination of Hedging Relationship					-				3,778				-				-100.00	%			n/a
Gross Loss on Write-Down of certain Investments to Fair Value					(5,108	)			(2,174	)			(720	)			134.96	%			609.44	%
Less: Non-Credit Related Other-Than-Temporary Impairment					(33	)			521				-				-106.33	%			n/a
Net Loss on Write-Down of Certain Investments to Fair Value					(5,141	)			(1,653	)			(720	)		211.01		%		614.03		%
Other Non-Interest /Income					1,578				1,476				1,432				6.91	%			10.20	%
Total Non-Interest Income					4,466				13,223				8,719				-66.23	%			-48.78	%
NON-INTEREST EXPENSE
Salaries and Employee Benefits					17,727				17,134				14,719				3.46	%			20.44	%
Occupancy and Equipment Expenses					3,985				4,136				3,200				-3.65	%			24.53	%
Data Processing and Facilities Management					1,580				1,604				1,465				-1.50	%			7.85	%
Merger & Acquisition Expense					41				10,844				-				-99.62	%			n/a
FDIC assessment					1,267				3,852				719				-67.11	%			76.22	%
Other Non-Interest Expense					7,704				8,986				5,356				-14.27	%			43.84	%
Total Non-Interest Expense					32,304				46,556				25,459				-30.61	%			26.89	%
INCOME BEFORE INCOME TAXES					8,627				1,299				12,120				564.13	%			-28.82	%
PROVISION FOR INCOME TAXES					1,786				639				3,305				179.50	%			-45.96	%
NET INCOME				$	6,841			$	660			$	8,815				936.52	%			-22.39	%
PREFERRED STOCK DIVIDEND				$	-			$	4,525			$	-				-100.00	%			n/a
NET (LOSS)/INCOME AVAILABLE TO COMMON SHAREHOLDERS				$	6,841			$	(3,865	)		$	8,815				-277.00	%			-22.39	%
BASIC EARNINGS PER SHARE				$	0.33			$	(0.19	)		$	0.54				-273.68	%			-38.89	%
DILUTED EARNINGS PER SHARE				$	0.33			$	(0.19	)		$	0.54				-273.68	%			-38.89	%
BASIC AVERAGE SHARES					20,921,635				20,360,046				16,275,442
DILUTED AVERAGE SHARES					20,969,889				20,385,609				16,338,180
PERFORMANCE RATIOS:
Net Interest Margin (FTE)					4.05	%			3.88	%			4.09	%			4.38	%			-1.00	%
Return on Average Assets					0.62	%			-0.35	%			1.04	%			280.00	%			-39.42	%
Return on Average Common Equity					6.73	%			-3.95	%			11.57	%			273.67	%			-40.79	%
RECONCILIATION TABLE - NON-GAAP FINANCIAL INFORMATION
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS (GAAP)				$	6,841			$	(3,865	)		$	8,815				-277.00	%			-22.39	%
Non-Interest Income Components
(Less)/Add - Net (Gain)/ Loss on Sale of Securities, net of tax					-				16				-
Less - Gain Resulting From early Termination of Hedging Relationship					-				(2,456	)			-
Non-Interest Expense Components
Add - Merger and Acquisition Expenses, net of tax					27				8,676				-
Add - Litigation Reserve, net of tax					-				-				(488	)
Deemed Preferred Stock Dividend					-				4,384				-
NET OPERATING EARNINGS				$	6,868			$	6,756			$	8,327				1.66	%			-17.52	%
Diluted Earnings Per Share, on an Operating Basis				$	0.33			$	0.33			$	0.51				0.00	%			-35.29	%
CONSOLIDATED STATEMENTS OF INCOME
				Nine Months								% Change
				September 30,				September 30,				Sept. 2009 vs.
				2009				2008				Sept. 2008
INTEREST INCOME
Interest on Fed Funds Sold and Short Term Investments				$	272			$	96				183.33	%
Interest and Dividends on Securities					22,546				16,990				32.70	%
Interest on Loans					126,491				112,732				12.21	%
Interest on Loans Held for Sale					497				293				69.62	%
Total Interest Income					149,806				130,111				15.14	%
INTEREST EXPENSE
Interest on Deposits					24,293				28,933				-16.04	%
Interest on Borrowed Funds					15,517				15,006				3.41	%
Total Interest Expense					39,810				43,939				-9.40	%
Net Interest Income					109,996				86,172				27.65	%
Less - Provision for Loan Losses					12,911				5,312				143.05	%
Net Interest Income after Provision for Loan Losses					97,085				80,860				20.07	%
NON-INTEREST INCOME
Service Charges on Deposit Accounts					12,518				11,681				7.17	%
Wealth Management					7,318				8,554				-14.45	%
Mortgage Banking Income					3,578				2,574				39.01	%
BOLI Income					2,126				1,816				17.07	%
Net Gain/(Loss) on Sale of Securities and Derivatives					1,355				(609	)			-322.50	%
Gain Resulting From early Termination of Hedging Relationship					3,778				-				n/a
Gross Loss on Write-Down of certain Investments to Fair Value					(7,384	)			(2,570	)			187.32	%
Less: Non-Credit Related Other-Than-Temporary Impairment					590				-				n/a
Net Loss on Write-Down of Certain Investments to Fair Value					(6,794	)			(2,570	)			164.36	%
Other Non-Interest (Loss)/Income					4,283				3,779				13.34	%
Total Non-Interest Income					28,162				25,225				11.64	%
NON-INTEREST EXPENSE
Salaries and Employee Benefits					49,720				43,806				13.50	%
Occupancy and Equipment Expenses					11,826				9,338				26.64	%
Data Processing and Facilities Management					4,600				4,170				10.31	%
Merger & Acquisition Expense					12,423				1,120				1009.20	%
WorldCom Bond Loss Recovery					-				(418	)			-100.00	%
FDIC assessment					5,655				830				581.33	%
Other Non-Interest Expense					22,943				18,706				22.65	%
Total Non-Interest Expense					107,167				77,552				38.19	%
INCOME BEFORE INCOME TAXES					18,080				28,533				-36.63	%
PROVISION FOR INCOME TAXES					4,192				7,590				-44.77	%
NET INCOME				$	13,888			$	20,943				-33.69	%
PREFERRED STOCK DIVIDEND				$	5,698			$	-				-
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS				$	8,190			$	20,943				-60.89	%
BASIC EARNINGS PER SHARE				$	0.43			$	1.35				-68.15	%
DILUTED EARNINGS PER SHARE				$	0.43			$	1.34				-67.91	%
BASIC AVERAGE SHARES					19,210,431				15,518,540
DILUTED AVERAGE SHARES					19,236,612				15,591,167
PERFORMANCE RATIOS:
Net Interest Margin (FTE)					3.85	%			4.00	%			-3.75	%
Return on Average Assets					0.26	%			0.87	%			-70.11	%
Return on Average Common Equity					2.73	%			9.74	%			-71.56	%
RECONCILIATION TABLE - NON-GAAP FINANCIAL INFORMATION
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS (GAAP)				$	8,190			$	20,943				-60.89	%
Non-Interest Income Components
(Less)/Add - Net (Gain)/ Loss on Sale of Securities, net of tax					(880	)			396
Less - Gain Resulting From early Termination of Hedging Relationship					(2,456	)			-
Non-Interest Expense Components
Add - Merger and Acquisition Expenses, net of tax					9,706				728
Add - Litigation Reserve, net of tax					-				488
Less - WorldCom Bond Loss Recovery, net of tax					-				(272	)
Deemed Preferred Stock Dividend					4,384				-
NET OPERATING EARNINGS				$	18,944			$	22,283				-14.98	%
Diluted Earnings Per Share, on an Operating Basis				$	0.98			$	1.43				-31.47	%
INDEPENDENT BANK CORP. FINANCIAL SUMMARY
(Unaudited - Dollars in Thousands, Except Per Share Data)
RECONCILIATION TABLE - NON-GAAP FINANCIAL INFORMATION
Certain non-core items are included in the computation of earnings in accordance with United States of America generally accepted accounting principles (“GAAP”) in both 2008 and 2007 as indicated by the table below. In an effort to provide investors with information regarding the Company's results, the Company has disclosed the following non-GAAP information, which management believes provides useful information to the investor. This information should not be viewed as a substitute for operating results determined in accordance with GAAP, nor is it necessarily comparable to non-GAAP information which may be presented by other companies.
				Three Months Ended																				Nine Months Ended
																% Change				% Change												% Change
				September 30,				June 30,				September 30,				Sept. 2009 vs.				Sept. 2009 vs.				September 30,				September 30,				Sept. 2009 vs.
				2009				2009				2008				June 2009				Sept. 2008				2009				2008				Sept. 2008
Non-Interest Income GAAP				$	4,466			$	13,223			$	8,719				-66.23	%			-48.78	%		$	28,162			$	25,225				11.64	%
(Less)/Add - Net (Gain)/ Loss on Sale of Securities					-				25				-				-100.00	%			n/a				(1,355	)			609				-322.50	%
(Less) Gain Resulting From early Termination of Hedging Relationship					-				(3,778	)			-				-100.00	%			n/a				(3,778	)			-				n/a
Add - Other-Than-Temporary-Impairment on Securities					5,141				1,653				720				211.01	%			614.03	%			6,794				2,570				164.36	%
Non-Interest Income as Adjusted				$	9,607			$	11,123			$	9,439				-13.63	%			1.78	%		$	29,823			$	28,404				5.00	%
Non-Interest Expense GAAP				$	32,304			$	46,556			$	25,459				-30.61	%			26.89	%		$	107,167			$	77,552				38.19	%
Less - Merger & Acquisition Expenses					(41	)			(10,844	)			-				-99.62	%			n/a				(12,423	)			(1,120	)			1009.20	%
Less/Add - Litigation Reserve					-				-				(750	)			n/a				n/a				-				750				-100.00	%
Add - WorldCom Bond Loss Recovery					-				-				-				n/a				n/a				-				418				-100.00	%
Non-Interest Expense as Adjusted				$	32,263			$	35,712			$	24,709				-9.66	%			30.57	%		$	94,744			$	77,600				22.09	%
ASSET QUALITY
				For the Period Ending
				September 30,				June 30,				September 30,
				2009				2009				2008
				(Dollars in Thousands, Except Per Share Data)
Nonperforming Loans
Commercial & Industrial Loans				$	3,744			$	4,808			$	1,481
Small Business Loans					969				1,743				773
Commercial Real Estate Loans					18,511				12,505				5,478
Residential Real Estate Loans					11,625				9,865				6,725
Installment Loans - Home Equity					1,237				1,695				1,106
Installment Loans - Auto					504				718				770
Installment Loans - Other					347				157				311
Total Nonperforming Loans				$	36,937			$	31,491				16,644
Non-Accrual Securities					1,134				1,844				-
Other Assets in Possession					255				270				-
Other Real Estate Owned					6,491				6,102				1,239
Nonperforming Assets					44,817				39,707				17,883
Nonperforming Loans/Gross Loans					1.09	%			0.94	%			0.65	%
Allowance for Loan Losses/Nonperforming Loans					111.97	%			127.24	%			199.99	%
Gross Loans/Total Deposits					103.25	%			100.85	%			101.66	%
Allowance for Loan Losses/Total Loans					1.22	%			1.19	%			1.29	%
Net charge-offs (quarter-to-date)				$	3,154			$	1,882			$	2,012
Net charge-offs to average loans (annualized)					0.37	%			0.23	%			0.31	%
Financial Ratios
Book Value per Common Share				$	19.43			$	19.01			$	18.72
Tangible Equity Ratio:
Tangible Common Capital/Tangible Assets					6.12	%			5.86	%			5.32	%
Tangible Common Capital/Tangible Asset (proforma to include the tax deductibility of goodwill and exclude impact of CPP) - Non-GAAP					6.58	%			6.33	%			5.76	%
Tangible Common Book Value per Share (proforma to include the tax deductibility of goodwill and exclude impact of CPP) - Non-GAAP				$	13.56			$	13.11			$	11.85
Capital Adequacy
Tier one leverage capital ratio (1)					7.66	%			7.60	%			7.69	%
(1) Estimated number for September 30, 2009
INDEPENDENT BANK CORP.
SUPPLEMENTAL FINANCIAL INFORMATION
CONSOLIDATED AVERAGE BALANCE SHEETS AND AVERAGE RATE DATA				Three Months Ended
(Unaudited - Dollars in Thousands)				September 30, 2009												June 30, 2009												September 30, 2008
								Interest												Interest												Interest
				Average				Earned/				Yield/				Average				Earned/				Yield/				Average				Earned/				Yield/
				Balance				Paid				Rate				Balance				Paid				Rate				Balance				Paid				Rate
Interest-Earning Assets:
Federal Funds Sold and Short Term Investments				$	4,060			$	4				0.39	%		$	86,883			$	70				0.32	%		$	2,162			$	62			11.47	%
Securities:
Trading Assets					22,941				109				1.90	%			13,965				44				1.26	%			3,179				30			3.77	%
Taxable Investment Securities					620,183				7,317				4.72	%			632,587				7,370				4.66	%			430,342				5,426			5.04	%
Non-taxable Investment Securities (1)					20,373				336				6.60	%			20,950				342				6.53	%			38,854				563			5.80	%
Total Securities:					663,497				7,762				4.68	%			667,502				7,756				4.65	%			472,375				6,019			5.10	%
Loans (1)					3,375,581				45,890				5.44	%			3,284,763				45,067				5.49	%			2,573,808				39,262			6.10	%
Loans Held for Sale					15,831				169				4.27	%			15,406				162				4.21	%			4,565				58			5.08	%
Total Interest-Earning Assets				$	4,058,969			$	53,825				5.30	%		$	4,054,554			$	53,055				5.23	%		$	3,052,910			$	45,401			5.95	%
Cash and Due from Banks					67,156												77,263												69,587
Federal Home Loan Bank Stock					36,357												35,065												24,603
Other Assets					280,147												299,108												233,978
Total Assets				$	4,442,629											$	4,465,990											$	3,381,078
Interest-bearing Liabilities:
Deposits:
Savings and Interest Checking Accounts				$	969,676			$	1,246				0.51	%		$	964,929			$	1,326				0.55	%		$	711,818			$	1,578			0.89	%
Money Market					677,851				1,597				0.94	%			666,232				1,713				1.03	%			473,685				2,203			1.86	%
Time Deposits					948,596				4,603				1.94	%			974,449				5,402				2.22	%			754,969				5,297			2.81	%
Total interest-bearing deposits:				$	2,596,123			$	7,446				1.15	%		$	2,605,610			$	8,441				1.30	%		$	1,940,472			$	9,078			1.87	%
Borrowings:
Federal Home Loan Bank Borrowings				$	395,878			$	2,901				2.93	%		$	449,311			$	2,972				2.65	%		$	299,631			$	2,781			3.71	%
Federal Funds Purchased and Assets Sold
Under Repurchase Agreement					184,181				857				1.86	%			173,992				812				1.87	%			165,852				1,249			3.01	%
Junior Subordinated Debentures					61,857				931				6.02	%			61,857				940				6.08	%			61,857				842			5.44	%
Subordinated Debentures					30,000				547				7.29	%			30,000				541				7.21	%			11,413				204			7.15	%
Other Borrowings					2,108				-				0.00	%			2,105				-				0.00	%			834				3			1.44	%
Total Borrowings:					674,024				5,236				3.11	%			717,265				5,265				2.94	%			539,587				5,079			3.77	%
Total Interest-Bearing Liabilities				$	3,270,147			$	12,682				1.55	%		$	3,322,875			$	13,706				1.65	%		$	2,480,059			$	14,157			2.28	%
Demand Deposits					702,071												673,448												561,542
Other Liabilities					63,821												61,582												34,754
Total Liabilities				$	4,036,039											$	4,057,905											$	3,076,355
Stockholders' Equity					406,590												408,085												304,723
Total Liabilities and Stockholders' Equity				$	4,442,629											$	4,465,990											$	3,381,078
Net Interest Income								$	41,143											$	39,349											$	31,244
Interest Rate Spread (2)													3.75	%											3.58	%										3.67	%
Net Interest Margin (3)													4.05	%											3.88	%										4.09	%
Supplemental Information:
Total Deposits, including Demand Deposits				$	3,298,194			$	7,446							$	3,279,058			$	8,441							$	2,502,014			$	9,078
Cost of Total Deposits													0.90	%											1.03	%										1.45	%
Total Funding Liabilities, including Demand Deposits				$	3,972,218			$	12,682							$	3,996,323			$	13,706							$	3,041,601			$	14,157
Cost of Total Funding Liabilities													1.28	%											1.37	%										1.86	%
(1) The total amount of adjustment to present interest income and yield on a fully tax-equivalent basis is $235, $249, and $316 for the three months ended September 30, 2009, June 30, 2009, and September 30, 2008, respectively.
(2) Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
(3) Net interest margin represents annualized net interest income as a percentage of average interest-earning assets.
				Nine Months Ended
(Unaudited - Dollars in Thousands)				September 30, 2009												September 30, 2008
								Interest												Interest
				Average				Earned/				Yield/				Average				Earned/				Yield/
				Balance				Paid				Rate				Balance				Paid				Rate
Interest-Earning Assets:
Federal Funds Sold and Short Term Investments				$	70,349			$	272				0.52	%		$	1,184			$	96				10.81	%
Securities:
Trading Assets					13,278				178				1.79	%			3,068				95				4.13	%
Taxable Investment Securities					606,388				21,624				4.75	%			418,332				15,576				4.96	%
Non-taxable Investment Securities (1)					23,792				1,145				6.42	%			42,124				2,029				6.42	%
Total Securities:					643,458				22,947				4.75	%			463,524				17,700				5.09	%
Loans (1)					3,106,752				126,856				5.44	%			2,438,462				113,078				6.18	%
Loans Held for Sale					15,453				497				4.29	%			7,283				293				5.36	%
Total Interest-Earning Assets				$	3,836,012			$	150,572				5.23	%		$	2,910,453			$	131,167				6.01	%
Cash and Due from Banks					68,192												66,066
Federal Home Loan Bank Stock					32,051												22,896
Other Assets					276,960												211,037
Total Assets				$	4,213,215											$	3,210,452
Interest-bearing Liabilities:
Deposits:
Savings and Interest Checking Accounts				$	892,383			$	3,567				0.53	%		$	677,470			$	4,740				0.93	%
Money Market					621,424				5,006				1.07	%			463,074				6,827				1.97	%
Time Deposits					918,510				15,720				2.28	%			700,784				17,366				3.30	%
Total interest-bearing deposits:				$	2,432,317			$	24,293				1.33	%		$	1,841,328			$	28,933				2.10	%
Borrowings:
Federal Home Loan Bank Borrowings				$	418,386			$	8,548				2.72	%		$	313,390			$	8,743				3.72	%
Federal Funds Purchased and Assets Sold
Under Repurchase Agreement					177,061				2,525				1.90	%			149,772				3,519				3.13	%
Junior Subordinated Debentures					61,857				2,819				6.08	%			59,599				2,483				5.55	%
Subordinated Debentures					30,000				1,625				7.22	%			3,832				204				7.10	%
Other Borrowings					1,996				-				0.00	%			2,262				57				3.36	%
Total Borrowings:					689,300				15,517				3.00	%			528,855				15,006				3.78	%
Total Interest-Bearing Liabilities				$	3,121,617			$	39,810				1.70	%		$	2,370,183			$	43,939				2.47	%
Demand Deposits					635,943												527,993
Other Liabilities					56,015												25,480
Total Liabilities				$	3,813,575											$	2,923,656
Stockholders' Equity					399,640												286,796
Total Liabilities and Stockholders' Equity				$	4,213,215											$	3,210,452
Net Interest Income								$	110,762											$	87,228
Interest Rate Spread (2)													3.53	%											3.54	%
Net Interest Margin (3)													3.85	%											4.00	%
Supplemental Information:
Total Deposits, including Demand Deposits				$	3,068,260			$	24,293							$	2,369,321			$	28,933
Cost of Total Deposits													1.06	%											1.63	%
Total Funding Liabilities, including Demand Deposits				$	3,757,560			$	39,810							$	2,898,176			$	43,939
Cost of Total Funding Liabilities													1.41	%											2.02	%
(1) The total amount of adjustment to present interest income and yield on a fully tax-equivalent basis is $766 and $1,056 for the nine months ended September 30, 2009, and September 30, 2008, respectively.
(2) Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
(3) Net interest margin represents annualized net interest income as a percentage of average interest-earning assets.
Certain amounts in prior year financial statement have been reclassified to conform to the current year's presentation.

Buzz up!