BOSTON PRIVATE FINANCIAL HOLDINGS, INC. (PARENT COMPANY ONLY)

Condensed Balance Sheets



	December 31, 2018		December 31, 2017
	(In thousands)
Assets:
Cash and cash equivalents	$	51,088	$	66,361
Investment in wholly-owned and majority-owned subsidiaries:
Bank	773,271		731,907
Non-banks	29,371		110,764
Investment in partnerships and trusts	6,340		6,340
Other assets	36,483		11,046
Total assets	$	896,553	$	926,418
Liabilities:
Junior subordinated debentures	$	106,363	$	106,363
Deferred income taxes	12,968		5,322
Other liabilities	20,742		11,328
Total liabilities	140,073		123,013
Redeemable Noncontrolling Interests (1)	2,526		22,647
Total Shareholders’ Equity	753,954		780,758
Total liabilities, redeemable noncontrolling interests and shareholders’ equity	$	896,553	$	926,418

___________________


(1)	Includes noncontrolling interests, if any, and the maximum redemption value of redeemable noncontrolling interests.

Condensed Statement of Operations



	Year ended December 31,
	2018		2017			2016
	(In thousands)
Income:
Interest income	$	107	$	180		$	130
Dividends from subsidiaries:
Bank	27,500		25,200			22,700
Non-banks	17,948		24,116			24,044
Gain/ (loss) on sale of affiliates or offices	18,142		(1,264		)	2,862
Other income	59		193			(2,552		)
Total income	63,756		48,425			47,184
Operating Expense:
Salaries and employee benefits	2,121		4,061			4,620
Professional fees	1,381		1,369			1,337
Interest expense	3,925		2,919			2,427
Other expenses	1,406		1,424			1,381
Total operating expense	8,833		9,773			9,765
Income before income taxes	54,923		38,652			37,419
Income tax expense/(benefit)	14,628		(6,880		)	(3,751		)
Net income from discontinued operations	2,002		4,870			5,541
Income before equity in undistributed earnings of subsidiaries	42,297		50,402			46,711
Equity/(loss) in undistributed earnings of subsidiaries	38,087		(9,811		)	24,917
Net income attributable to the Company	$	80,384	$	40,591		$	71,628

Condensed Statement of Cash Flows



	Year ended December 31,
	2018			2017			2016
	(In thousands)
Cash flows from operating activities:
Net income attributable to the Company	$	80,384		$	40,591		$	71,628
Net income from discontinued operations	2,002			4,870			5,541
Net income from continuing operations	78,382			35,721			66,087
Adjustments to reconcile net income from continuing operations to net cash provided by/ (used in) operating activities:
Equity in earnings/(loss) of subsidiaries:
Bank	(70,930		)	(50,476		)	(58,184		)
Non-banks	(12,302		)	11,150			(13,477		)
Dividends from subsidiaries:
Bank	27,500			25,200			22,700
Non-banks	17,948			24,116			24,044
Depreciation and amortization	(186		)	3,553			(738		)
(Gain)/loss on sale of affiliates or offices	(18,142		)	1,264			—
Net decrease/ (increase) in other operating activities	13,181			(2,440		)	(6,633		)
Net cash provided by/ (used in) operating activities of continuing operations	35,451			48,088			33,799
Net cash provided by/ (used in) operating activities of discontinued operations	2,002			4,870			5,541
Net cash provided by/ (used in) operating activities	37,453			52,958			39,340
Cash flows from investing activities:
Contingent consideration from divestitures	1,233			—			—
Capital investments in subsidiaries:
Non-banks	(96		)	(54		)	(1,220		)
Cash received from divestitures	52,981			—			—
Net cash (used in)/ provided by in other investing activities	—			—			1
Net cash provided by/ (used in) investing activities	54,118			(54		)	(1,219		)
Cash flows from financing activities:
Redemption of Series D preferred stock	(50,000		)	—			—
Equity sales/ (purchases) in minority-owned subsidiaries	1,021			1,410			1,890
Repurchase of common stock	(20,000		)	—			(9,323		)
Dividends paid to common shareholders	(40,685		)	(37,054		)	(33,110		)
Dividends paid to preferred shareholders	(1,738		)	(3,475		)	(3,475		)
Tax benefit/ (deficiency) from certain stock compensation awards	—			—			(620		)
Proceeds from stock option exercises	1,661			882			1,725
Proceeds from issuance of common stock, net	434			2,740			7,786
Other equity adjustments	2,463			(5,740		)	(3,685		)
Net cash provided by/ (used in) financing activities	(106,844		)	(41,237		)	(38,812		)
Net (decrease)/ increase in cash and cash equivalents	(15,273		)	11,667			(691		)
Cash and cash equivalents at beginning of year	66,361			54,694			55,385
Cash and cash equivalents at end of year	$	51,088		$	66,361		$	54,694