Hingham Institution for Savings Reports 30% Increase in Quarterly Earnings

HINGHAM, Mass.--(Business Wire)--
HINGHAM INSTITUTION FOR SAVINGS (Nasdaq - HIFS), Hingham,
Massachusetts announced second quarter earnings for 2008. Net income
for the quarter ended June 30, 2008 was $1,416,000 or $0.67 per share
(basic and diluted) as compared to net income of $1,090,000 or $0.51
per share (basic and diluted) for the same period last year.

Assets at June 30, 2008 were $778,395,000 and represented a 9.7%
increase over June 30, 2007.

The annualized Return on Average Equity for the second quarter and
first half of 2008 were 9.99% and 9.63% respectively.

Increases in capital were also noted and at June 30, 2008, the
Bank reported book value per share of $26.77, a 6.6% increase from
June 30, 2007.

President Robert H. Gaughen, Jr. stated "We're pleased to report
that our current quarterly earnings represent a 30% increase over the
second quarter of 2007 and our earnings from the first half of 2008
represent a 33% increase over those of the first half of 2007.
Non-performing assets were 1.1% of total assets at June 30, 2008. The
Bank is actively managing these assets and believes that their
supporting collateral and the current level of loan loss reserves is
adequate to cover losses, if any. While no bank is completely immune
from the challenge of declining real estate values, continued
improvements in our net interest margin, diligent cost control and
prudent lending standards have produced real bottom line improvements
at a time when some banks are struggling. Our goal remains to continue
our quality growth and effective cost control in this challenging
environment."

Hingham Institution for Savings is a Massachusetts-chartered
savings bank located in Hingham, Massachusetts. Incorporated in 1834,
it is the oldest financial institution headquartered in Hingham and
one of the oldest in the Commonwealth. The Bank's main offices are
located on Main Street, Hingham, Massachusetts 02043, phone (781)
749-2200. The Bank also maintains branch offices in South Hingham and
the neighboring towns of Cohasset, Hull, Norwell, Scituate, and
Weymouth along with a branch office in Boston's South End.

The Bank's shares of common stock are listed and traded on The
Nasdaq Stock Market under the symbol HIFS.

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HINGHAM INSTITUTION FOR SAVINGS

Consolidated Balance Sheets

June 30, June 30,
2008 2007
-------- --------
(Unaudited) ($ in thousands
except per share
amounts)
ASSETS

Cash and due from banks $ 10,166 $ 7,913
Short-term investments 40,326 10,961
-------- --------
Cash and cash equivalents 50,492 18,874

Certificates of deposit 8,450 4,066
Securities available for sale, at fair value 56,913 94,885
Federal Home Loan Bank stock, at cost 12,567 12,041
Loans, net of allowance for loan losses
of$4,019,000 in 2008 and $3,758,000 in 2007 625,806 557,983
Bank-owned life insurance 12,930 12,459
Premises and equipment, net 5,747 3,818
Accrued interest receivable 2,872 3,374
Deferred income tax asset, net 1,319 1,409
Other real estate owned 701 -
Other assets 598 595
-------- --------
Total assets $778,395 $709,504
======== ========

LIABILITIES AND STOCKHOLDERS' EQUITY

Deposits $467,598 $428,688
Federal Home Loan Bank advances 248,213 223,662
Mortgage payable 1,236 -
Mortgagors' escrow accounts 1,612 1,406
Accrued interest payable 887 898
Other liabilities 2,055 1,663
-------- --------
Total liabilities 721,601 656,317
-------- --------

Stockholders' equity:
Preferred stock, $1.00 par value,
2,500,000 shares authorized; none issued -- --
Common stock, $1.00 par value, 5,000,000 shares
authorized; shares issued and outstanding:
2,121,750
at June 30, 2008 and 2,118,550 at June 30, 2007 2,122 2,119
Additional paid-in capital 10,362 10,290
Undivided profits 44,344 41,327
Accumulated other comprehensive loss (34) (549)
-------- --------
Total stockholders' equity 56,794 53,187
-------- --------

Total liabilities and stockholders' equity $778,395 $709,504
======== ========

Book value per share $ 26.77 $ 25.11
======== ========
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HINGHAM INSTITUTION FOR SAVINGS

Consolidated Statements of Income

Three Months Six Months
Ended Ended
June 30, June 30,
(In Thousands, Except for Per Share
Amounts) 2008 2007 2008 2007
------------- -------------
(Unaudited)

Interest and dividend income:
Loans $ 9,526$ 8,939$19,206$17,546
Debt securities 449 1,058 1,113 2,062
Equity securities 156 222 376 448
Short-term investments and certificates
of deposit 303 116 631 239
------ ------ ------ ------
Total interest and dividend income 10,434 10,335 21,326 20,295
------ ------ ------ ------
Interest expense:
Deposits 2,944 3,484 6,538 6,809
Federal Home Loan Bank advances 2,497 2,905 5,218 5,823
Mortgage payable 18 - 34 -
------ ------ ------ ------
Total interest expense 5,459 6,389 11,790 12,632
------ ------ ------ ------
Net interest income 4,975 3,946 9,536 7,663
Provision for loan losses 200 85 268 155
------ ------ ------ ------
Net interest income after provision for
loan losses 4,775 3,861 9,268 7,508
------ ------ ------ ------
Other income:
Customer service fees on deposits 245 238 485 491
Increase in bank-owned life insurance 121 128 237 246
Miscellaneous 44 47 90 93
------ ------ ------ ------
Total other income 410 413 812 830
------ ------ ------ ------
Operating expenses:
Salaries and employee benefits 1,762 1,582 3,510 3,197
Data processing 209 201 416 399
Occupancy and equipment 301 289 607 580
Other general and administrative 690 562 1,323 1,114
------ ------ ------ ------
Total operating expenses 2,962 2,634 5,856 5,290
------ ------ ------ ------
Income before income taxes 2,223 1,640 4,224 3,048
Income tax provision 807 550 1,521 1,013
------ ------ ------ ------
Net income $ 1,416$ 1,090$ 2,703$ 2,035
====== ====== ====== ======

Cash dividends declared per common share $ 0.20$ 0.20$ 0.40$ 0.40
====== ====== ====== ======

Weighted average shares outstanding:
Basic 2,122 2,119 2,121 2,118
====== ====== ====== ======
Diluted 2,122 2,120 2,122 2,120
====== ====== ====== ======

Earnings per share:
Basic $ 0.67$ 0.51$ 1.27$ 0.96
====== ====== ====== ======
Diluted $ 0.67$ 0.51$ 1.27$ 0.96
====== ====== ====== ======

Return on average equity 9.99% 8.21% 9.63% 7.72%
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Hingham Institution for Savings
William M. Donovan, Jr., 781-749-2200
Vice President-Administration
or
Robert H. Gaughen, Jr., President
Hingham Institution for Savings
Hingham, MA (Nasdaq - HIFS)

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