Except as required by law, the Companyassumes no obligation to update any forward-looking statements.NON-GAAP FINANCIAL MEASURESThis news release contains certain non-GAAP financial measures in addition toresults presented in accordance with Generally Accepted Accounting Principles("GAAP"). These non-GAAP measures provide supplemental perspectives on operatingresults, performance trends, and financial condition. A reconciliation of non-GAAP financialmeasures to GAAP measures is included in the accompanying financial tables. Inall cases, it should be understood that non-GAAP per share measures do notdepict amounts that accrue directly to the benefit of shareholders. The Companyutilizes the non-GAAP measure of core earnings in evaluating operating trends,including components for core revenue and expense. These measures excludeamounts which the Company views as unrelated to its normalized operations,including merger costs and restructuring costs. 
Similarly, the efficiency ratiois also adjusted for these non-core items. Additionally, the Company adjustscore income to exclude amortization of intangibles to arrive at a measure of theunderlying operating cash return for the benefit of stockholders. The Companyalso adjusts certain equity related measures to exclude intangible assets due tothe importance of these measures to the investment community BERKSHIRE HILLS BANCORP, INC. CONSOLIDATED BALANCE SHEETS - UNAUDITED December 31, September 30, December 31, (In thousands)2008 20082007 Assets Total cash and cash equivalents$26,582$26,445$33,259 Fed funds sold & short-terminvestments 18,2168,1247,883 Trading securities 18,144 15,267 Securities available for sale,at fair value276,423205,554197,964 Securities held to maturity, at amortized cost 25,872 25,923 39,456 Federal Home Loan Bank stock 21,077 21,077 21,077 Loans held for sale 1,7685,4013,445 Residential mortgages 677,254672,004657,045 Commercial mortgages808,591794,780704,764 Commercial business loans 175,799181,224203,564 Consumer loans345,508344,359378,643 Total loans 2,007,1521,992,3671,944,016 Less: Allowance for loan losses (22,908) (22,886) (22,116) Net loans 1,984,2441,969,4811,921,900 Premises and equipment, net37,448 37,902 38,806 Goodwill161,178161,178161,632 Other intangible assets17,652 18,490 20,820 Cash surrender value of lifeinsurance policies35,668 35,331 35,316 Other assets 42,457 35,526 31,874 Total assets$ 2,666,729$ 2,565,699$ 2,513,432 Liabilities and stockholders'equity Demand deposits $ 233,040$ 227,271$ 231,994 NOW deposits190,828196,217213,150 Money market deposits 448,238450,818439,341 Savings deposits211,156220,800210,186 Total non-maturity deposits 1,083,2621,095,1061,094,671 Brokered time deposits2,9423,008 21,497 Other time deposits 743,376739,090706,395 Total time deposits 746,318742,098727,892 Total deposits1,829,5801,837,2041,822,563 Borrowings359,157366,092334,474 Junior subordinated debentures15,464 15,464 15,464 Derivative liabilities 23,8682,608 Due to broker19,895 Other liabilities10,340 11,649 14,094 Total liabilities 2,258,3042,233,0172,186,595 Total stockholders' equity408,425332,682326,837 Total liabilities andstockholders' equity $ 2,666,729$ 2,565,699$ 2,513,432 BERKSHIRE HILLS BANCORP, INC.CONSOLIDATED LOAN & DEPOSIT ANALYSIS - UNAUDITED - LOAN ANALYSIS -Sept 30, Dec 31,Dec. 31, 2008 20082007 -Quarterlyannualized Annual (Dollars in millions)Balance growth growthBalanceBalance -Residential mortgages:1 - 4 Family $642 4 5 $636 $610Construction 35 (11) (26) 36 47 -Total residentialmortgages677 33 672657Commercial mortgages:Construction130 (12) 4 134125Single and multi-family70170 69Other commercialmortgages60812 19 591510 -Total commercialmortgages808 7 15 795704Commercial businessloans176 (11) (14)181204 -Total commercial loans984 38 976908Consumer loans:Auto and other140 (43) (34)157211Home equity 20641 23 187168 -Total consumer loans346 2 (9)344379 -Total loans$2,007 3 3 $1,992 $1,944 - DEPOSIT ANALYSIS Sept 30, Dec 31,Dec. 31, 2008 20082007 -Quarterlyannualized Annual (Dollars in millions)Balance growth growthBalanceBalance - Demand$23311 $227 $232 NOW191 (10) (10)196213 Money market 448(3) 2 451439 Savings211 (18) 221211 -Total non-maturity deposits1,083(4)(1)1,0951,095 Time less than $100,000392(2)(4)394409 Time $100,000 or more351 7 18 345298 Brokered time3(86)3 21 - Total time deposits746 22 742728 - Total deposits$1,829(2) $1,837 $1,823 -BERKSHIRE HILLS BANCORP, INC.CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED Three Months Ended Years Ended December 31, December 31, (In thousands, exceptper share data)2008 2007 2008 2007 Interest and dividendincome Loans $29,343$32,666$ 120,567$ 120,059 Securities and other3,4193,183 12,644 11,885 Total interest anddividend income 32,762 35,849133,211131,944 Interest expense Deposits9,248 13,749 41,733 50,597 Borrowings and juniorsubordinated debentures4,0443,882 15,738 17,422 Total interest expense 13,292 17,631 57,471 68,019 Net interest income19,470 18,218 75,740 63,925 Non-interest income Insurance commissions andfees 2,1392,290 13,619 13,728 Deposit service fees2,6232,6209,7827,747 Wealth management fees1,1711,4765,7044,407 Loan service and interestrate swap fees 203 911,229772 Total fee income6,1366,477 30,334 26,654 Other 2415511,2831,710 Loss on sale ofsecurities, net (22)(591) Loss on prepayment ofborrowings, net (1,180) Gain (loss) on sale ofloans, net 41 (1,950) Total non-interest income 6,3777,069 31,595 24,643 Total net revenue25,847 25,287107,335 88,568 Provision for loan losses 1,4003,0604,5804,300 Non-interest expense Salaries and employeebenefits 8,9889,386 38,282 34,018 Occupancy and equipment 2,7362,656 11,2389,945 Marketing, dataprocessing, andprofessional services2,3382,2758,7618,598 Non-recurring expense1,1986832,956 Amortization of intangibleassets 8381,0503,8303,058 Other 2,3561,8288,9056,919 Total non-interest expense 17,256 18,393 71,699 65,494 Income before income taxes7,1913,834 31,056 18,774 Income tax expense1,9857618,8125,239 Net income$ 5,206$ 3,073$22,244$13,535 Basic earnings per commonshare$0.44$0.29$2.08$1.47 Diluted earnings percommon share $0.44$0.29$2.06$1.44 Weighted average commonshares outstanding Basic11,804 10,524 10,7009,223 Diluted11,892 10,664 10,7919,370 BERKSHIRE HILLS BANCORP, INC.CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED - Quarters Ended - (In thousands, except per shareDec 31,Sept 30, June 30,Mar 31,Dec.
31,data) 20082008200820082007 - Interest and dividendincome Loans$ 29,343$ 30,078$ 29,823$ 31,323$ 32,666 Securities and other3,419 3,014 3,011 3,200 3,183 - Total interest anddividend income 32,76233,09232,83434,52335,849 Interest expense Deposits9,248 9,67610,52112,28813,749 Borrowings and juniorsubordinateddebentures 4,044 4,087 3,666 3,941 3,882 - Total interestexpense 13,29213,76314,18716,22917,631 - Net interest income19,47019,32918,64718,29418,218 Non-interest income Insurance commissionsand fees 2,139 2,640 3,694 5,146 2,290 Deposit service fees2,623 2,518 2,486 2,155 2,620 Wealth managementfees 1,171 1,338 1,567 1,628 1,476 Loan service andinterest rate swapfees 203 561 228 23791 - Total fee income6,136 7,057 7,975 9,166 6,477 Other 241 174 562 306 551 Gain (loss) onsecurities, net 4 (26) Gain on sale ofloans, net41 - Total non-interestincome 6,377 7,235 8,511 9,472 7,069 - Total net revenue25,84726,56427,15827,76625,287 Provision for loanlosses 1,400 1,250 1,105 825 3,060 Non-interest expense Salaries and employeebenefits 8,988 9,796 9,842 9,656 9,386 Occupancy andequipment2,736 2,760 2,774 2,968 2,656 Marketing, dataprocessing, andprofessionalservices 2,338 2,121 2,181 2,121 2,275 Non-recurring expense 683 1,198 Amortization ofintangible assets838 889 1,019 1,084 1,050 Other 2,356 2,171 2,133 2,245 1,828 - Total non-interestexpense 17,25617,73718,63218,07418,393 - Income before incometaxes7,191 7,577 7,421 8,867 3,834 Income tax expense1,985 2,301 1,708 2,818 761 - Net income $5,206$5,276$5,713$6,049$3,073 - Basic earnings pershare $ 0.44$ 0.51$ 0.55$ 0.58$ 0.29 Diluted earnings pershare $ 0.44$ 0.51$ 0.55$ 0.58$ 0.29 Weighted averageshares outstanding Basic11,80410,30310,30210,38610,524 Diluted11,89210,40010,38410,45710,664BERKSHIRE HILLS BANCORP AND SUBSIDIARIES ASSET QUALITY ANALYSIS At or for the Quarters Ended (Dollars inDec 31,Sept 30, June 30,Mar 31,Dec. 31,thousands)20082008200820082007 NON-PERFORMING ASSETS Nonaccruing loans: Residentialmortgages $1,646$1,315$763$1,060$726 Commercial mortgages7,738 6,178 5,329 7,082 5,177 Commercial businessloans1,921 2,210 3,103 3,557 4,164 Indirect auto andinstallment loans693 576 503 374 346 Home equity 17374746795 Total nonaccruingloans 12,17110,353 9,77212,14010,508 Other real estateowned498 941 1,050 755 866 Total nonperformingassets$ 12,669$ 11,294$ 10,822$ 12,895$ 11,374 Total nonperformingloans/total loans 0.61 0.52 0.49 0.63 0.54 Total nonperformingassets/total assets 0.48 0.44 0.42 0.51 0.46 PROVISION ANDALLOWANCE FOR LOANLOSSES Balance at beginningof period $ 22,886$ 22,581$ 22,130$ 22,116$ 22,108 Charged-off loans(1,474) (1,331) (754) (883) (3,117) Recoveries oncharged-off loans 96 386 1007265 Net loans charged-off(1,378) (945) (654) (811) (3,052) Acquired allowance Provision for loanlosses 1,400 1,250 1,105 825 3,060 Balance at end ofperiod$ 22,908$ 22,886$ 22,581$ 22,130$ 22,116 Allowance for loanlosses/nonperformingloans188221231182210 Allowance for loanlosses/total loans1.14 1.15 1.14 1.14 1.14 NET LOAN CHARGE-OFFS Residential mortgages $ $ (119) $ $(24) $ Commercial mortgages (900)(63) (131) (175) Commercial businessloans(10) (265) (121) (213) (2,683) Indirect auto andinstallment loans (468) (498) (402) (339) (319) Home equity (60)(50) Total net$ (1,378) $ (945) $ (654) $ (811) $ (3,052) Net charge-offs(YTD annualized)/average loans 0.19 0.16 0.15 0.17 0.34 DELINQUENT LOANS /TOTAL LOANS 30-89 Days delinquent0.46 0.45 0.33 0.41 0.39 90 Days delinquentand still accruing0.05 0.03 0.04 0.03 0.04 Total accruingdelinquent loans0.51 0.48 0.37 0.44 0.43 Nonaccruing loans0.61 0.52 0.49 0.63 0.54 Total delinquentloans 1.12 1.00 0.86 1.07 0.97 BERKSHIRE HILLS BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS At or for the Quarters Ended Dec 31,Sept 30, June 30,Mar 31,Dec. 31,20082008200820082007 PERFORMANCE RATIOSCore return on tangible assets0.98 1.03 1.16 1.24 0.83Return on total assets 0.790.820.910.970.50Core return on tangible common equity12.70 15.85 17.89 19.52 12.90Return on total common equity5.626.266.897.383.74Net interest margin, fully taxable equivalent 3.413.483.453.413.38Core tangible non-interest income to tangible assets 1.041.211.471.641.23Non-interest income to assets0.971.131.361.521.14Core tangible non-interest expense to tangible assets 2.682.822.912.952.80Non-interest expense to assets2.622.762.972.892.95Efficiency ratio 62.24 62.18 61.08 60.12 62.51 YEAR-TO-DATE GROWTHTotal loans334 (2) 3Total deposits 1(1) 12 2Total revenues2129211923 FINANCIAL DATA(In millions)Total assets$2,667$2,566$2,547$2,546$2,513Total loans2,007 1,992 1,978 1,935 1,944Total intangible assets179 180 181 182 182Total deposits 1,830 1,837 1,811 1,880 1,823Total stockholders' equity408 333 330 329 327Total stockholders' common equity 368 333 330 329 327Total core income5.2 5.3 5.7 6.0 3.8Total net income 5.2 5.3 5.7 6.0 3.1 ASSET QUALITY RATIOSNet charge-offs (annualized)/ average loans0.27 0.19 0.13 0.17 0.34Non-performing assets/total assets0.480.440.420.510.45Loan loss allowance/ total loans1.141.151.141.141.14Loan loss allowance/ nonperforming loans1.88x 2.21x 2.31x 1.82x2.10x PER SHARE DATACore earnings, diluted$ 0.44$ 0.51$ 0.55$ 0.58$ 0.36Net earnings, diluted0.440.510.550.580.29Tangible common book value 15.47 14.58 14.36 13.97 13.82Total common book value 30.07 31.71 31.78 31.38 31.15Market price at period end30.86 32.00 23.65 25.19 26.00Dividends 0.160.160.160.150.15 CAPITAL RATIOSCommon stockholders' equity to total assets13.8212.9712.9612.9113.00Tangible common stockholders' equity to tangible assets 7.626.416.306.196.22Stockholders' equity to total assets 15.3212.9712.9612.9113.00Tangible stockholders' equity to tangible assets 9.236.416.306.196.22 (1) Reconciliations of Non-GAAP financial measures, including all references to core and tangible amounts, appear on page F-9. Tangible assets are total assets less total intangible assets. (2) All performance ratios are annualized and are based on average balance sheet amounts, where applicable (3) The Dec. 31, 2007 total loan annualized year-to-date growth calculations exclude the acquired FAPB balances and $50 million in residential mortgage loans sold during September 07 (4) The Dec.
4 Estimate increases rose to 121 from 86 40Through five weeks there are three undefeated teams in the NFCThat's a valid argument but let's look deeper into each gameWyeth retreated fromearlier gains falling 0Ryan admits he didnrsquot prepare the defense properly for this gameFTEU3 index of leading Europeanshares rose 3Without the charges EPS would have been 026 PRNewswireFirstCall Cogdell Spencer IncThis article is also featured on A Vol VoiceWashington scores and goes for two No big deal
