Boston Private Reports Record Earnings and AUM for the Third Quarter 2007

Boston Private Financial Holdings, Inc. (NASDAQ: BPFH) (the "Company”) today reported third quarter 2007 cash earnings per diluted share (defined later in this press release) of $0.54, a 20.0% increase over $0.45 per diluted share in the third quarter 2006. GAAP earnings were $0.44 per diluted share, compared to $0.36 per diluted share for the third quarter 2006, a 22.2% increase. Included in the third quarter 2007 financials are the results from the most recent acquisition of Charter Bank ("Charter”) on July 1, 2007. More detailed financial information regarding Charter’s financial results is outlined later in this press release. In addition, included in Boston Private’s financial performance are the consolidated results for August and September from Bingham Osborn & Scarborough LLC ("BOS”), which became a majority-owned affiliate partner as of August 2007 as we acquired an additional 10% of the company, bringing our total ownership to approximately 60%. Highlights -- Total Net Income for the third quarter 2007 increased 27.6% to $17.4 million, compared to $13.7 million a year ago. On a same affiliate basis, net income was $16.6 million, an increase of 21.4% compared to the third quarter of 2006. The increase in net income was driven by solid growth across the Company's three key disciplines: private banking (an increase of 19.3%), wealth advisory (an increase of 111.2%), and investment management (an increase of 28.0%). -- Total Revenues for the third quarter 2007 increased 19.2% to $105.5 million, compared to $88.5 million a year ago. On a same affiliate basis, total revenues were $101.6 million, representing an increase of 14.7% compared to the third quarter 2006. -- Net Interest Income increased $7.0 million, or 16.2%, to $50.1 million. On a same affiliate basis, net interest income was up $3.2 million, or 7.4%, to $46.4 million compared with the third quarter 2006 and 4.8% on a linked quarter, same affiliate basis. -- Organic growth, on a linked quarter basis, increased net interest income by $2.1 million. -- Net interest margin was 3.59%, a decrease of 17 basis points from a year ago, but an increase of 12 basis points from the second quarter 2007. -- The linked quarter change in the net interest margin was primarily due to: -- increasing yields on our loan portfolio as a result of residential loans repricing at higher rates, and deposit growth; -- the inclusion of Charter Bank's net interest margin, which raised the consolidated net interest margin by 6 basis points, net of financing costs; and -- the debt issuance of $287.5 million in 3% convertible notes, which increased the net interest margin by 6 basis points. -- Wealth Advisory Fee Income increased $3.3 million to $10.1 million for the third quarter of 2007, an increase of 49.3% over the prior year. Included in the wealth advisory fee income is $2.3 million in wealth advisory fees from BOS for the months of August and September. Excluding the BOS fee income, wealth advisory fee income grew to $7.8 million, an increase of 15.8% compared to the third quarter 2006. -- Investment Management Fee Income for the third quarter 2007 totaled $41.8 million, an increase of 17.8% over the third quarter 2006. On a linked quarter basis, investment management fee income was up $1.5 million, or 3.7%. -- Total Operating Expenses, including minority interests, for the third quarter increased 15.8% to $75.1 million, compared to $64.8 million a year ago. On a same affiliate basis, operating expenses were $72.5 million, an increase of 11.8%. -- Operating Leverage was positive 2.4% for the third quarter 2007 compared with the second quarter 2007. Operating leverage was positive 0.2% for the third quarter of 2007 as compared to the third quarter of 2006. -- Total Assets increased 20.4% to $6.6 billion over the September 30, 2006 balance of $5.5 billion. Charter Bank, acquired on July 1, 2007, had $385 million in assets at September 30, 2007. -- Loans increased $889 million, or 21.4%, to $5.0 billion over the September 30, 2006 balance of $4.1 billion. Commercial and construction loans totaled $3.0 billion and represented 59% of the combined loan portfolio. Residential mortgage loans totaled $1.8 billion and represented 35% of the total portfolio. Loan growth was predominantly due to organic growth and the addition of Charter Bank, which added $249 million in loans for the quarter ended September 30, 2007. -- Loan Credit Quality -- The allowance for loan losses, as a percentage of total loans was 1.03%, up three basis points from the prior quarter. -- Non-performing assets as a percentage of total assets increased 15 basis points to $28.2 million, which represents 0.43% of total assets, as of September 30, 2007, up from 0.28% of total assets at June 30, 2007. -- The Company recorded $90 thousand in net charge offs during the quarter, which represented less than 0.2 basis points of total loans. -- Deposits increased $456 million, or 11.8%, to $4.3 billion over the September 30, 2006 balance of $3.9 billion. The increase in deposits came from $239 million of organic growth, and the addition of $217 million in deposits from Charter Bank. -- Total Assets Under Management/Advisory from consolidated and unconsolidated affiliates increased 21%, or $6.5 billion, over the prior year to $37.2 billion. On a linked quarter basis, total assets under management and advisory from consolidated and unconsolidated increased approximately $1.2 billion, or 3.3%, reflecting an annualized growth rate of 13.2%. -- Change in Assets Under Management. On a consolidated basis, Boston Private had net inflows of funds from the investment managers and banks of approximately $351 million related to organic growth and an increase of approximately $656 million related to positive market action for the quarter. Timothy L. Vaill, Chairman and Chief Executive Officer, said, "We had our strongest quarter ever driven by solid investment performance, positive asset flows, loan growth, and expense controls. Our results are a testament to the strength of our diversification strategy and a demonstration of our commitment to delivering long-term shareholder value. Press reports of the sub prime crisis have been so pervasive as to prompt me to order a system wide status review of credit. I am pleased to report that while we experienced a 15 basis point increase in our non-performing assets as a percentage of total assets this quarter, today we expect no material losses from these loans. Our net charge offs continue to be immaterial. In fact, cumulatively for the past eight quarters, we have reported net recoveries. We lend actively in two of the hardest hit areas of the country, namely South Florida and the Inland Empire in Southern California. We have increased our vigilance in all areas but at present feel that our conservative underwriting policies and our niche lending strategies will serve us well.” Walter M. Pressey, President, stated, "To build a successful wealth management organization, it is essential to generate organic growth. While we are thrilled with the acquisition of Charter Bank, which operates in the burgeoning Pacific Northwest market, I am equally gratified that we grew the organization organically. We were particularly pleased to see good organic deposit growth this year. Our six newer private banking offices contributed 16% of our new deposits year over year. Our wealth management fees expanded nicely and most of our investment management products continued to outperform their benchmarks. All combined to contribute to a positive return on our investments.” David J. Kaye, Boston Private’s Chief Financial Officer, advised, "Since joining the Company just a quarter ago, I have been impressed with the quality of the talent and the highly focused approach to delivering a quality customer experience to the high net worth market. Working together during the quarter, we achieved an important long term growth metric: positive operating leverage.” CEO Vaill concluded, "The wealth management industry faces challenges today. With challenges, opportunities ultimately arise and I believe Boston Private is uniquely positioned to capitalize on those opportunities. Our long-term objective is to deliver organic growth that will generate solid returns to our shareholders.” Dividend Payment Continues Concurrent with the release of the third quarter 2007 earnings, the Board of Directors of Boston Private Financial Holdings declared a cash dividend to shareholders of $0.09 per share, reflecting the quarterly earnings performance. The record date for this dividend is November 1, 2007 and the payment date is November 15, 2007. Cash Earnings Boston Private calculates its cash earnings by adjusting net income to exclude net amortization of intangibles, impairment, and the impact of certain non-cash share based compensation plans, and includes related tax benefits that result from purchase accounting that are deferred under GAAP. In addition to GAAP earnings, the Company believes its cash earnings report the additional value to shareholders generated by purchase accounting adjustments and the non-cash share based compensation plans. (A detailed reconciliation table is attached.) Conference Call Management will host a conference call to review the Company’s financial performance and business developments on October 25, 2007 at 9 a.m. Eastern time. Interested parties may join the call by dialing 800-867-0731 and the password required is "Boston”. The call will be simultaneously web cast and may be accessed on the Internet by linking through www.bostonprivate.com. A continuous telephone replay will be available beginning at 11:30 a.m. Eastern time. The replay telephone number is 800-388-9064. Boston Private Wealth Management Group Boston Private is a financial services company that owns independently operated affiliates located in key geographic regions of the U.S. Boston Private's affiliates offer private banking, wealth advisory and investment management services to the high net worth marketplace, selected businesses and institutions. The Company's strategy is to enter new markets primarily through selected acquisitions, and then expand its wealth management business by way of organic growth. It makes investments in mid-size firms in demographically attractive areas, forming geographic clusters that represent the firm's three key disciplines. Boston Private provides continuing assistance to its affiliates with strategic matters, marketing, compliance and operations. For more information about Boston Private, visit the Company's web site at www.bostonprivate.com 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”). The Company’s management uses these non-GAAP measures in its analysis of the Company’s performance. These measures typically adjust GAAP performance measures to exclude the effects of net amortization of intangibles, tax benefits related to purchase accounting, stock options, impairment and ESPP expense. Because these items and their impact on the Company’s performance are difficult to predict, management believes that presentations of financial measures considering the impact of these items provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s businesses. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Statements in this press release that are not historical facts are forward-looking statements as defined by United States securities laws. Forward-looking statements involve risks and uncertainties. These statements include, but are not limited to, prospects for long term financial performance, the impact on the Company’s results of improved market conditions and prevailing and future interest rates, prospects for growth in balance sheet assets and assets under management and advisory, and prospects for overall results over the long term. You should not place undue reliance on our forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to significant risks, uncertainties and other factors which are, in some cases, beyond Boston Private’s control and could cause actual results to differ materially from those set forth in the forward-looking statements. Factors that could cause actual results to differ materially from those set forth in the forward-looking statements include, among others, adverse conditions in the capital markets and the impact of such conditions on Boston Private’s investment advisory activities; interest rate compression which may adversely impact net interest income; competitive pressures from other financial institutions which, together with other factors, may affect the Company’s growth and financial performance; the effects of national and local economic conditions; and the risk that goodwill and intangibles recorded in the Company’s financial statements will become impaired; as well as the other risks and uncertainties detailed in Boston Private's Annual Report on Form 10-K and other filings submitted to the Securities and Exchange Commission. Boston Private does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made. Boston Private Financial Holdings, Inc. Selected Financial Data (In Thousands, except share data) (Unaudited)             September 30, September 30, December 31, FINANCIAL DATA: 2007   2006   2006   Total Balance Sheet Assets $ 6,595,539 $ 5,478,170 $ 5,763,544 Stockholders' Equity 690,303 619,240 635,197 Tangible Capital: Boston Private Bank & Trust 172,652 154,988 160,639 Borel Private Bank & Trust 102,305 87,426 91,300 First Private Bank & Trust 51,257 46,115 48,388 Gibraltar Private Bank & Trust 86,907 75,340 78,692 Charter Bank 26,653 - - Investment Securities 620,821 536,057 577,903 Goodwill 365,862 318,417 335,633 Intangible Assets 124,442 125,601 125,331   Commercial and Construction Loans 2,974,098 2,382,898 2,496,234 Residential Mortgage Loans 1,761,538 1,486,942 1,546,965 Home Equity and Other Consumer Loans   302,360       278,971       268,053   Total Loans 5,037,996 4,148,811 4,311,252   Loans Held for Sale 2,959 5,034 5,224 Allowance for Loan Losses and Off-Balance Sheet Risk 56,161 47,707 48,973 Non-performing Loans 25,574 12,592 9,999 Repossessed Assets, Net 475 550 550 Other Real Estate Owned, Net 2,116 - - Total Non-performing Assets 28,165 13,142 10,549 Deposits 4,310,908 3,854,594 4,077,831 Borrowings 1,465,000 871,160 914,529   Book Value Per Share $ 18.46 $ 16.96 $ 17.19 Market Price Per Share $ 27.84 $ 27.88 $ 28.21   ASSETS UNDER MANAGEMENT AND ADVISORY:   Westfield Capital Management $ 12,306,000 $ 9,074,000 $ 10,102,000 Boston Private Bank & Trust 2,784,000 2,309,000 2,369,000 Sand Hill Advisors 1,205,000 1,151,000 1,252,000 Boston Private Value Investors 870,000 914,000 961,000 RINET Company 1,398,000 1,202,000 1,262,000 Borel Private Bank & Trust 740,000 683,000 731,000 Dalton, Greiner, Hartman, Maher & Co. 1,780,000 2,784,000 2,302,000 KLS Professional Advisors Group 4,355,000 3,494,000 3,727,000 Gibraltar Private Bank & Trust 1,046,000 888,000 907,000 Anchor Capital Holdings 7,648,000 5,806,000 6,444,000 First Private Bank & Trust 22,000 - 5,000 Bingham, Osborn, & Scarborough (1) 2,098,000 1,634,000 1,777,000 Less: Inter-company Relationship   (254,000 )     (211,000 )     (238,000 ) Consolidated Affiliate Assets Under Management and Advisory $ 35,998,000 $ 29,728,000 $ 31,601,000   Coldstream Capital Management   1,188,000       1,000,000       1,090,000   Total Assets Under Management and Advisory $ 37,186,000 $ 30,728,000 $ 32,691,000     FINANCIAL RATIOS:   Stockholders' Equity/Total Assets 10.47 % 11.30 % 11.02 % Non-performing Loans/Total Loans 0.51 % 0.30 % 0.23 % Allowance for Loan Losses and Off-Balance Sheet Risk/Total Loans 1.11 % 1.15 % 1.14 % Tangible Capital/ Tangible Assets 3.28 % 3.48 % 3.29 %       Three Months Ended   Nine Months Ended September 30,   September 30, September 30,   September 30, OPERATING RESULTS: 2007   2006   2007   2006   Net Interest Income - on a Fully Taxable Equivalent Basis (FTE) $ 51,969 $ 44,646 $ 142,949 $ 134,316 FTE Adjustment   1,821       1,488       5,178       4,188 Net Interest Income   50,148       43,158       137,771       130,128 Investment Management & Trust Fees: Westfield Capital Management 19,405 14,238 54,814 41,877 Boston Private Bank & Trust 4,021 3,352 11,564 10,240 Boston Private Value Investors 1,737 1,701 5,236 5,057 Borel Private Bank & Trust 1,256 1,149 3,624 3,196 Gibraltar Private Bank & Trust 2,051 1,640 5,946 4,715 Dalton, Greiner, Hartman, Maher & Co. 4,079 6,559 12,586 21,139 First Private Bank & Trust 25 - 74 - Anchor Capital Holdings   9,229       6,854       25,965       9,119 Total Investment Management & Trust Fees 41,803 35,493 119,809 95,343 Wealth Advisory Fees: RINET Company 2,403 2,029 6,913 6,046 Sand Hill Advisors 1,629 1,539 5,028 4,642 KLS Professional Advisors Group 3,760 3,155 10,756 9,039 Bingham, Osborn, & Scarborough (1) 2,271 - 2,271 - Other   52       51       148       149 Total Wealth Advisory Fees   10,115       6,774       25,116       19,876 Other Fees   2,783       2,038       8,246       5,532 Total Fees   54,701       44,305       153,171       120,751 Earnings in Equity Investments 398 528 1,663 1,519 Gain on Sale of Loans, Net 296 556 1,523 1,538 Gain on Sale of Investments, Net   3       -       11       -   Total Fees and Other Income   55,398       45,389       156,368       123,808 Total Revenue   105,546       88,547       294,139       253,936   Provision for Loan Losses   3,738       2,325       5,659       5,192   Salaries and Employee Benefits 50,312 42,244 143,584 121,827 Occupancy and Equipment 8,708 7,695 24,685 21,249 Professional Services 3,953 3,161 11,288 9,696 Marketing and Business Development 2,548 1,842 7,980 6,540 Contract Services and Processing 1,696 1,301 4,740 3,804 Amortization of Intangibles 3,728 3,736 10,785 9,775 Provision for off-balance sheet risks (2,029 ) (102 ) (1,444 ) 599 Other   4,640       3,805       13,122       11,922 Total Operating Expense   73,556       63,682       214,740       185,412 Income before Minority Interest, Income Taxes & Impairment 28,252 22,540 73,740 63,332 Impairment of Goodwill, net of tax   -       -       10,054       - Income before Minority Interest and Income Taxes 28,252 22,540 63,686 63,332 Minority Interest 1,509 1,120 2,529 2,679 Income Before Income Taxes 26,743 21,420 61,157 60,653 Income Tax Expense, net of impairment   9,326       7,770       25,830       21,888 Net Income $ 17,417     $ 13,650     $ 35,327     $ 38,765         Three Months Ended   Nine Months Ended September 30,   September 30, September 30,   September 30, RECONCILIATION OF GAAP EARNINGS TO CASH EARNINGS: 2007   2006   2007   2006     Net Income (GAAP Basis) $ 17,417 $ 13,650 $ 35,327 $ 38,765   Cash Basis Earnings (2) Book Amortization of Purchased Intangibles, net of tax 2,002 2,032 5,803 5,423 Cash Benefit of Tax Deductions from Purchased Intangibles & Goodwill 1,112 1,023 3,300 3,068 Impairment of Goodwill, net of tax - - 10,054 - Stock options and ESPP, net of tax   1,036       829       3,082       2,792   Total Cash Basis Adjustment   4,150       3,884       22,239       11,283   Cash Basis Earnings $ 21,567     $ 17,534     $ 57,566     $ 50,048       Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2007   2006   2007   2006 PER SHARE DATA: (In thousands, except per share data)   Calculation of Net Income for EPS:   Net Income as reported and for basic EPS $ 17,417 $ 13,650 $ 35,327 $ 38,765 Interest on convertible trust preferred securities, net of tax (6)   750       765       2,250       2,295   Net Income for diluted EPS $ 18,167 $ 14,415 $ 37,577 $ 41,060   Calculation of average shares outstanding: Weighted average basic shares 36,976 35,953 36,623 35,249 Dilutive effect of: Stock Options, Stock Grants and Other 1,463 1,270 1,540 1,414 Convertible trust preferred securities (6)   3,184       3,183       3,184       3,183   Dilutive potential common shares 4,647 4,453 4,724 4,597 Weighted average diluted shares for EPS 41,623 40,406 41,347 39,846   Earnings per Share: Basic $ 0.47 $ 0.38 $ 0.96 $ 1.10 Diluted (6) $ 0.44 $ 0.36 $ 0.91 $ 1.03   RECONCILIATION OF GAAP EPS TO CASH EPS (2): (on a Diluted Basis)   Earnings Per Share (GAAP Basis) $ 0.44 $ 0.36 $ 0.91 $ 1.03 Cash Basis Adjustment $ 0.10     $ 0.09     $ 0.54     $ 0.28   Cash Basis Earnings Per Diluted Share $ 0.54     $ 0.45     $ 1.45     $ 1.31         Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2007   2006   2007   2006 OPERATING RATIOS & STATISTICS:   Return on Average Equity 10.29 % 8.95 % 8.21 % 9.01 % Return on Average Assets 1.07 % 1.02 % 0.91 % 0.99 % Net Interest Margin 3.59 % 3.76 % 3.52 % 3.91 % Core Net Interest Margin(3) 3.83 % 4.03 % 3.78 % 4.19 % Total Fees and Other Income/Total Revenue 52.49 % 51.26 % 53.16 % 48.76 % Efficiency Ratio 67.36 % 67.51 % 69.36 % 68.62 % Loans Charged-off, Net of (Recoveries) $ 90 ($101 ) ($428 ) $ 438     RECONCILIATION OF NIM TO CORE NIM   Net Interest Margin 3.59 % 3.76 % 3.52 % 3.91 % Effect of Trust Preferred & Acquisition Financing 0.24 % 0.27 % 0.26 % 0.28 % Core Net Interest Margin(3) 3.83 % 4.03 % 3.78 % 4.19 %     CASH OPERATING RATIOS:   Return on Average Equity (4) 12.74 % 11.50 % 13.38 % 11.64 % Return on Average Assets (5) 1.33 % 1.31 % 1.48 % 1.28 % AVERAGE BALANCE SHEET:             Three Months Ended Three Months Ended September 30, 2007 September 30, 2006 Average Income/   Yield/ Average   Income/   Yield/ AVERAGE ASSETS: Balance   Expense   Rate Balance   Expense   Rate Earnings Assets Cash and investment $ 775,588 $ 8,631 5.01 % $ 638,334 $ 6,497 4.61 % Loans Commercial and Construction 2,922,801 57,117 7.79 % 2,298,433 44,704 7.76 % Residential Mortgage 1,733,467 26,383 6.09 % 1,485,702 20,983 5.65 % Home Equity and Other Consumer   296,020     6,025 7.94 %   274,387       5,478 7.69 % Total Earning Assets   5,727,876     98,156 7.20 %   4,696,856       77,662 6.98 % Allowance for Loan Losses (52,170 ) (40,695 ) Cash and due from Banks 80,293 61,280 Other Assets   738,978     654,049   TOTAL AVERAGE ASSETS $ 6,494,977   $ 5,371,490       AVERAGE LIABILITIES AND STOCKHOLDERS' EQUITY:   Interest-Bearing Liabilities: Deposits: Savings and NOW $563,174 $ 2,983 2.10 % $ 446,870 $ 1,905 1.69 % Money Market 1,836,110 15,554 3.36 % 1,754,157 13,275 3.00 % Certificate of Deposits   1,067,439     13,067 4.86 %   771,820       8,365 4.30 % Total Deposits 3,466,723 31,604 3.62 % 2,972,847 23,545 3.14 % Junior Subordinated Debentures 507,174 5,784 5.47 % 234,021 3,304 5.53 % FHLB Borrowings and Other 932,362     10,620 4.44 %   694,463       7,655 4.31 % Total Interest-Bearing Liabilities   4,906,259     48,008 4.47 %   3,901,331       34,504 3.49 % Non-interest Bearing Demand Deposits 762,768 712,060 Payables and Other Liabilities   148,818       148,051   Total Liabilities 5,817,845 4,761,442 Stockholders' Equity   677,132       610,048   TOTAL AVERAGE LIABILITIES & STOCKHOLDERS' EQUITY $ 6,494,977   $ 5,371,490     Net Interest Income $ 50,148 $ 43,158     AVERAGE BALANCE SHEET:       Nine Months Ended Nine Months Ended September 30, 2007 September 30, 2006 Average Income/ Yield/ Average Income/ Yield/ AVERAGE ASSETS: Balance   Expense   Rate Balance   Expense   Rate Earnings Assets Cash and investment $ 734,807 $ 24,039 4.93 % $ 693,816 $ 19,571 4.26 % Loans Commercial and Construction 2,698,740 155,878 7.73 % 2,164,046 123,011 7.65 % Residential Mortgage 1,641,386 72,575 5.90 % 1,442,958 60,436 5.58 % Home Equity and Other Consumer   279,282     16,646 7.84 %   259,461       15,106 7.64 % Total Earning Assets   5,354,215     269,138 6.79 %   4,560,281       218,124 6.88 % Allowance for Loan Losses (49,030 ) (39,247 ) Cash and due from Banks 76,928 62,379 Other Assets   701,268     615,088   TOTAL AVERAGE ASSETS $ 6,083,381   $ 5,198,501       AVERAGE LIABILITIES AND STOCKHOLDERS' EQUITY:   Interest-Bearing Liabilities: Deposits: Savings and NOW $ 557,907 $ 8,926 2.14 % $ 451,697 $ 4,587 1.36 % Money Market 1,859,095 46,991 3.38 % 1,731,579 33,565 2.59 % Certificate of Deposits   960,660     34,371 4.78 %   732,790       21,478 3.92 % Total Deposits 3,377,662 90,288 3.57 % 2,916,066 59,630 2.73 % Junior Subordinated Debentures 326,920 12,376 5.63 % 234,021 9,848 5.63 % FHLB Borrowings and Other 846,324     28,703 4.47 %   604,773       18,518 4.04 % Total Interest-Bearing Liabilities   4,550,906     131,367 3.85 %   3,754,860       87,996 3.12 % Non-interest Bearing Demand Deposits 733,020 733,062 Payables and Other Liabilities   138,252       137,105   Total Liabilities 5,422,178 4,625,027 Stockholders' Equity   661,203       573,474   TOTAL AVERAGE LIABILITIES & STOCKHOLDERS' EQUITY $ 6,083,381     $ 5,198,501     Net Interest Income $ 137,771 $ 130,128 Private Banking Data - Period End Data September 30,   September 30,     2007   2006 Loans: Boston Private Bank & Trust $ 1,959,709 $ 1,735,437 Borel Private Bank & Trust 979,417 850,310 First Private Bank & Trust 521,730 384,104 Gibraltar Private Bank & Trust 1,326,385 1,174,832 Charter Bank 248,710 -   Deposits: Boston Private Bank & Trust 1,825,365 1,703,753 Borel Private Bank & Trust 926,085 832,824 First Private Bank & Trust 527,171 388,888 Gibraltar Private Bank & Trust 847,070 941,635 Charter Bank 216,630 -   Three Months Ended September 30, September 30, 2007   2006   NIM: Boston Private Bank & Trust 3.04 % 3.22 % Borel Private Bank & Trust 4.43 % 4.57 % First Private Bank & Trust 5.67 % 6.15 % Gibraltar Private Bank & Trust 3.77 % 4.37 % Charter Bank 5.10 % -           September 30, June 30, 2007   2007 FINANCIAL DATA:   Total Balance Sheet Assets $ 6,595,539 $ 5,939,469 Stockholders' Equity 690,303 663,695 Tangible Capital: Boston Private Bank & Trust 172,652 166,093 Borel Private Bank & Trust 102,305 100,146 First Private Bank & Trust 51,257 49,157 Gibraltar Private Bank & Trust 86,907 83,608 Charter Bank 26,653 - Investment Securities 620,821 576,137 Goodwill 365,862 311,240 Intangible Assets 124,442 118,828   Commercial and Construction Loans 2,974,098 2,701,540 Residential Mortgage Loans 1,761,538 1,603,529 Home Equity and Other Consumer Loans   302,360       281,092   Total Loans 5,037,996 4,586,161   Loans Held for Sale 2,959 8,603 Allowance for Loan Losses and Off-Balance Sheet Risk 56,161 51,995 Non-performing Loans 25,574 14,003 Repossessed Assets, Net 475 475 Other Real Estate Owned 2,116 2,116 Total Non-performing Assets 28,165 16,594 Deposits 4,310,908 3,902,432 Borrowings 1,465,000 1,256,505   Book Value Per Share $ 18.46 $ 17.84 Market Price Per Share $ 27.84 $ 26.87   ASSETS UNDER MANAGEMENT AND ADVISORY:   Westfield Capital Management $ 12,306,000 $ 11,659,000 Boston Private Bank & Trust 2,784,000 2,600,000 Sand Hill Advisors 1,205,000 1,271,000 Boston Private Value Investors 870,000 943,000 RINET Company 1,398,000 1,347,000 Borel Private Bank & Trust 740,000 718,000 Dalton, Greiner, Hartman, Maher & Co. 1,780,000 1,806,000 KLS Professional Advisors Group 4,355,000 4,204,000 Gibraltar Private Bank & Trust 1,046,000 959,000 Anchor Capital Holdings 7,648,000 7,483,000 First Private Bank & Trust 22,000 21,000 Bingham, Osborn, & Scarborough (1) 2,098,000 2,038,000 Less: Inter-company Relationship   (254,000 )     (250,000 ) Consolidated Affiliate Assets Under Management and Advisory $ 35,998,000 $ 34,799,000   Coldstream Capital Management   1,188,000       1,200,000   Total Unconsolidated Assets Under Management and Advisory $ 37,186,000 $ 35,999,000   FINANCIAL RATIOS:   Stockholders' Equity/Total Assets 10.47 % 11.17 % Nonperforming Loans/Total Loans 0.51 % 0.31 % Allowance for Loan Losses and Off-Balance Sheet Risk/Total Loans 1.11 % 1.13 % Tangible Capital/Tangible Assets   3.28 %     4.24 %       Three Months Ended September 30,   June 30, OPERATING RESULTS: 2007   2007   Net Interest Income - on a Fully Taxable Equivalent Basis (FTE) $ 51,969 $ 45,960 FTE Adjustment   1,821       1,722 Net Interest Income   50,148       44,238 Investment Management & Trust Fees: Westfield Capital Management 19,405 18,704 Boston Private Bank & Trust 4,021 3,857 Boston Private Value Investors 1,737 1,734 Borel Private Bank & Trust 1,256 1,241 Gibraltar Private Bank & Trust 2,051 2,057 Dalton, Greiner, Hartman, Maher & Co. 4,079 3,979 First Private Bank & Trust 25 26 Anchor Capital   9,229       8,700 Total Investment Management & Trust Fees 41,803 40,298 Wealth Advisory Fees RINET Company 2,403 2,384 Sand Hill Advisors 1,629 1,694 KLS Professional Advisors Group 3,760 3,611 Bingham, Osborn, & Scarborough (1) 2,271 - Other   52       48 Total Wealth Advisory Fees   10,115       7,737 Other Fees   2,783       3,015 Total Fees   54,701       51,050 Earnings in Equity Investments 398 582 Gain on Sale of Loans, Net 296 695 Gain on Sale of Investments, Net   3       5   Total Fees and Other Income   55,398       52,332 Total Revenue   105,546       96,570   Provision for Loan Losses   3,738       745   Salaries and Benefits 50,312 46,672 Occupancy and Equipment 8,708 8,103 Professional Services 3,953 4,129 Marketing and Business Development 2,548 2,834 Contract Services and Processing 1,696 1,608 Amortization of Intangibles 3,728 3,508 Provision for off-balance sheet risks (2,029 ) 422 Other   4,640       4,367 Total Operating Expense   73,556       71,643 Income before Minority Interest, Income Taxes & Impairment 28,252 24,182 Impairment of Goodwill, net of tax - 10,054 Income before Minority Interest and Income Taxes 28,252 14,128 Minority Interest 1,509 106 Income Before Income Taxes 26,743 14,022 Income Tax Expense, Net of Impairment   9,326       9,246 Net Income $ 17,417     $ 4,776   Three Months Ended September 30, June 30, RECONCILIATION OF GAAP EARNINGS TO CASH EARNINGS (2): 2007   2007     Net Income (GAAP Basis) $ 17,417 $ 4,776   Cash Basis Earnings Book Amortization of Purchased Intangibles, net of tax 2,002 1,890 Cash Benefit of Tax Deductions from Purchased Intangibles & Goodwill 1,112 1,077 Impairment of Goodwill, net of tax - 10,054 Stock options and ESPP, net of tax   1,036       925 Total Cash Basis Adjustment   4,150       13,946 Cash Basis Earnings $ 21,567       18,722         Three Months Ended September 30,   June 30, 2007   2007 PER SHARE DATA:  (In thousands, except per share data)   Calculation of Net Income for EPS:   Net Income as reported and for basic EPS $ 17,417 $ 4,776 Interest on convertible trust preferred securities, net of tax (6)   750       -   Net Income for diluted EPS $ 18,167 $ 4,776   Interest on convertible trust preferred securities, net of tax for Cash EPS (6) - $ 750   Calculation of Average Shares Outstanding: Weighted average basic shares 36,976 36,616 Dilutive effect of: Stock Options and Stock Grants, and Other 1,463 1,487 Convertible trust preferred securities (6)   3,184       -   Dilutive potential common shares 4,647 1,487 Weighted average diluted shares for EPS 41,623 38,103 Wighted average diluted shares for Cash EPS - 41,288 Earnings per Share: Basic $ 0.47 $ 0.13 Diluted $ 0.44 $ 0.13   RECONCILIATION OF GAAP EPS TO CASH EPS (2):   (on a Diluted Basis)   Earnings Per Share (GAAP Basis) $ 0.44 $ 0.13 Cash Basis Adjustment $ 0.10     $ 0.34   Cash Basis Earnings Per Diluted Share $ 0.54     $ 0.47     OPERATING RATIOS & STATISTICS:   Return on Average Equity 10.29 % 2.89 % Return on Average Assets 1.07 % 0.32 % Net Interest Margin 3.59 % 3.47 % Core Net Interest Margin (3) 3.83 % 3.72 % Total Fees and Other Income/Total Revenue 52.49 % 54.19 % Efficiency Ratio 67.36 % 69.80 % Loans Charged-off, Net of (Recoveries) $ 90 ($525 )     RECONCILIATION OF NIM TO CORE NIM Net Interest Margin 3.59 % 3.47 % Effect of Trust Preferred , Net 0.24 % 0.25 % Core Net Interest Margin (3) 3.83 % 3.72 % AVERAGE BALANCE SHEET:             Three Months Ended Three Months Ended September 30, 2007   June 30, 2007 Average Income/   Yield/ Average   Income/   Yield/ AVERAGE ASSETS: Balance   Expense   Rate   Balance   Expense   Rate Earnings Assets Cash and investment $ 775,588 $ 8,631 5.01 % $ 735,046 $ 8,093 4.96 % Loans Commercial and Construction 2,922,801 57,117 7.79 % 2,628,288 50,252 7.68 % Residential Mortgage 1,733,467 26,383 6.09 % 1,604,611 23,358 5.82 % Home Equity and Other Consumer   296,020     6,025 7.94 %   276,672       5,442 7.83 % Total Earning Assets   5,727,876     98,156 7.20 %   5,244,617       87,145 6.74 % Allowance for Loan Losses (52,170 ) (48,008 ) Cash and due from Banks 80,293 54,105 Other Assets   738,978     700,054   TOTAL AVERAGE ASSETS $ 6,494,977   $ 5,950,768       AVERAGE LIABILITIES AND STOCKHOLDERS' EQUITY:   Interest-Bearing Liabilities: Deposits: Savings and NOW $ 563,174 $ 2,983 2.10 % $ 564,742 $ 3,014 2.14 % Money Market 1,836,110 15,554 3.36 % 1,867,200 15,728 3.38 % Certificate of Deposits   1,067,439     13,067 4.86 %   925,998       11,031 4.78 % Total Deposits 3,466,723 31,604 3.62 % 3,357,940 29,773 3.56 % Junior Subordinated Debentures 507,174 5,784 5.47 % 234,021 3,299 5.58 % FHLB Borrowings and Other   932,362     10,620 4.44 %   863,757       9,835 4.50 % Total Interest-Bearing Liabilities   4,906,259     48,008 4.47 %   4,455,718       42,907 3.85 % Non-interest Bearing Demand Deposits 762,768 706,598 Payables and Other Liabilities   148,818       126,942   Total Liabilities 5,817,845 5,289,258 Stockholders' Equity   677,132       661,510   TOTAL AVERAGE LIABILITIES & STOCKHOLDERS' EQUITY $ 6,494,977   $ 5,950,768     Net Interest Income $ 50,148 $ 44,238 Private Banking Data - Period End Data   September 30,   June 30,     2007   2007 Loans: Boston Private Bank & Trust $ 1,959,709 $ 1,891,545 Borel Private Bank & Trust 979,417 958,465 First Private Bank & Trust 521,730 453,435 Gibraltar Private Bank & Trust 1,326,385 1,279,403 Charter Bank 248,710 -   Deposits: Boston Private Bank & Trust 1,825,365 1,717,913 Borel Private Bank & Trust 926,085 887,508 First Private Bank & Trust 527,171 460,947 Gibraltar Private Bank & Trust 847,070 877,469 Charter Bank 216,630 -   Three Months Ended September 30, June 30, 2007   2007 NIM: Boston Private Bank & Trust 3.04 % 3.04 % Borel Private Bank & Trust 4.43 % 4.46 % First Private Bank & Trust 5.67 % 5.44 % Gibraltar Private Bank & Trust 3.77 % 3.69 % Charter Bank 5.10 % - SAME AFFILIATES         Growth Excluding Acquisitions     As Reported Acquisitions Same Affiliates September 30, September 30, September 30, September 30, FINANCIAL DATA: 2007   2006   2007   2007   Total Balance Sheet Assets $ 6,595,539 $ 5,478,170 $ 428,531 $ 6,167,008 Stockholders' Equity 690,303 619,240 43,562 646,741 Tangible Capital: Boston Private Bank & Trust 172,652 154,988 - 172,652 Borel Private Bank & Trust 102,305 87,426 - 102,305 First Private Bank & Trust 51,257 46,115 - 51,257 Gibraltar Private Bank & Trust 86,907 75,340 - 86,907 Charter Bank 26,653 - 26,653 - Investment Securities 620,821 536,057 54,131 566,690 Goodwill 365,862 318,417 49,849 316,013 Intangible Assets 124,442 125,601 6,558 117,884   Commercial and Construction Loans 2,974,098 2,382,898 144,450 2,829,648 Residential Mortgage Loans 1,761,538 1,486,942 95,484 1,666,054 Home Equity and Other Consumer Loans   302,360       278,971       8,776     293,584   Total Loans 5,037,996 4,148,811 248,710 4,789,286   Loans Held for Sale 2,959 5,034 - 2,959 Allowance for Loan Losses and Off-Balance Sheet Risk 56,161 47,707 2,665 53,496 Non-performing Loans 25,574 12,592 - 25,574 Repossessed Assets, Net 475 550 - 475 Other Real Estate Owned, Net 2,116 - 2,116 Total Non-performing Assets 28,165 13,142 - 28,165 Deposits 4,310,908 3,854,594 216,630 4,094,278 Borrowings 1,465,000 871,160 60,935 1,404,065   ASSETS UNDER MANAGEMENT  AND ADVISORY:   Westfield Capital Management $ 12,306,000 $ 9,074,000 - $ 12,306,000 Boston Private Bank & Trust 2,784,000 2,309,000 - 2,784,000 Sand Hill Advisors 1,205,000 1,151,000 - 1,205,000 Boston Private Value Investors 870,000 914,000 - 870,000 RINET Company 1,398,000 1,202,000 - 1,398,000 Borel Private Bank & Trust 740,000 683,000 - 740,000 Dalton, Greiner, Hartman, Maher & Co. 1,780,000 2,784,000 - 1,780,000 KLS Professional Advisors Group 4,355,000 3,494,000 - 4,355,000 Gibraltar Private Bank & Trust 1,046,000 888,000 - 1,046,000 Anchor Capital Holdings 7,648,000 5,806,000 - 7,648,000 First Private Bank & Trust 22,000 - - 22,000 Bingham, Osborn, & Scarborough (1) 2,098,000 1,634,000 - 2,098,000 Less: Inter-company Relationship   (254,000 )     (211,000 )     -     (254,000 ) Consolidated Affiliate Assets Under Management and Advisory $ 35,998,000 $ 29,728,000 - $ 35,998,000   Coldstream Capital Management   1,188,000       1,000,000       -     1,188,000   Total Assets Under Management and Advisory $ 37,186,000 $ 30,728,000 $ 0 $ 37,186,000       Three Months Ended As Reported Acquisitions Same Affiliates September 30, September 30, September 30, September 30, OPERATING RESULTS: 2007   2006   2007   2007   Net Interest Income - on a Fully Taxable Equivalent Basis (FTE) $ 51,969 $ 44,646 $ 3,789 $ 48,180 FTE Adjustment   1,821       1,488       -     1,821   Net Interest Income   50,148       43,158       3,789     46,359   Investment Management & Trust Fees: Westfield Capital Management 19,405 14,238 - 19,405 Boston Private Bank & Trust 4,021 3,352 - 4,021 Boston Private Value Investors 1,737 1,701 - 1,737 Borel Private Bank & Trust 1,256 1,149 - 1,256 Gibraltar Private Bank & Trust 2,051 1,640 - 2,051 Dalton, Greiner, Hartman, Maher & Co. 4,079 6,559 - 4,079 First Private Bank & Trust 25 - - 25 Anchor Capital Holdings   9,229       6,854       -     9,229   Total Investment Management & Trust Fees 41,803 35,493 - 41,803 Wealth Advisory Fees: RINET Company 2,403 2,029 - 2,403 Sand Hill Advisors 1,629 1,539 - 1,629 KLS Professional Advisors Group 3,760 3,155 - 3,760 Bingham, Osborn, & Scarborough (1) 2,271 - - 2,271 Other   52       51       -     52   Total Wealth Advisory Fees   10,115       6,774       -     10,115   Other Fees   2,783       2,038       170     2,613   Total Fees   54,701       44,305       170     54,531   Earnings in Equity Investments 398 528 - 398 Gain on Sale of Loans, Net 296 556 - 296 Gain on Sale of Investments, Net   3       -       -     3     Total Fees and Other Income   55,398       45,389       170     55,228   Total Revenue   105,546       88,547       3,959     101,587     Provision for Loan Losses   3,738       2,325       119     3,619     Salaries and Employee Benefits 50,312 42,244 1,486 48,826 Occupancy and Equipment 8,708 7,695 291 8,417 Professional Services 3,953 3,161 112 3,841 Marketing and Business Development 2,548 1,842 86 2,462 Contract Services and Processing 1,696 1,301 74 1,622 Amortization of Intangibles 3,728 3,736 212 3,516 Provision for off-balance sheet risks (2,029 ) (102 ) - (2,029 ) Other   4,640       3,805       341     4,299   Total Operating Expense   73,556       63,682       2,602     70,954   Income before Minority Interest, Income Taxes & Impairment 28,252 22,540 1,238 27,014 Impairment of Goodwill, net of tax - - - - Income before Minority Interest and Income Taxes 28,252 22,540 1,238 27,014 Minority Interest 1,509 1,120 - 1,509 Income Before Income Taxes 26,743 21,420 1,238 25,505 Income Tax Expense   9,326       7,770       392     8,934   Net Income $ 17,417     $ 13,650     $ 846   $ 16,571         Nine Months Ended As Reported     Acquisitions   Same Affiliates September 30, September 30, September 30, September 30, OPERATING RESULTS: 2007   2006   2007   2007   Net Interest Income - on a Fully Taxable Equivalent Basis (FTE) $ 142,949 $ 134,316 $ 3,825 $ 139,124 FTE Adjustment   5,178       4,188     -     5,178   Net Interest Income   137,771       130,128     3,825     133,946   Investment Management & Trust Fees: Westfield Capital Management 54,814 41,877 - 54,814 Boston Private Bank & Trust 11,564 10,240 - 11,564 Boston Private Value Investors 5,236 5,057 - 5,236 Borel Private Bank & Trust 3,624 3,196 - 3,624 Gibraltar Private Bank & Trust 5,946 4,715 - 5,946 Dalton, Greiner, Hartman, Maher & Co. 12,586 21,139 - 12,586 First Privare Bank & Trust 74 - - 74 Anchor Capital Holdings   25,965       9,119     13,907     12,058   Total Investment Management & Trust Fees 119,809 95,343 13,907 105,902 Wealth Advisory Fees: RINET Company 6,913 6,046 - 6,913 Sand Hill Advisors 5,028 4,642 - 5,028 KLS Professional Advisors Group 10,756 9,039 - 10,756 Bingham, Osborn, & Scarborough (1) 2,271 - - 2,271 Other   148       149     -     148   Total Wealth Advisory Fees   25,116       19,876     -     25,116   Other Fees   8,246       5,532     278     7,968   Total Fees   153,171       120,751     14,185     138,986   Earnings in Equity Investments 1,663 1,519 - 1,663 Gain on Sale of Loans, Net 1,523 1,538 - 1,523 Gain on Sale of Investments, Net   11       -     6     5     Total Fees and Other Income   156,368       123,808     14,191     142,177   Total Revenue   294,139       253,936     18,016     276,123     Provision for Loan Losses   5,659       5,192     119     5,540     Salaries and Employee Benefits 143,584 121,827 8,686 134,898 Occupancy and Equipment 24,685 21,249 601 24,084 Professional Services 11,288 9,696 193 11,095 Marketing and Business Development 7,980 6,540 363 7,617 Contract Services and Processing 4,740 3,804 163 4,577 Amortization of Intangibles 10,785 9,775 1,644 9,141 Provision for off-balance sheet risks (1,444 ) 599 - (1,444 ) Other   13,122       11,922     534     12,588   Total Operating Expense   214,740       185,412     12,184     202,556   Income before Minority Interest, Income Taxes & Impairment 73,740 63,332 5,713 68,027 Impairment of Goodwill, net of tax 10,054 - - 10,054 Income before Minority Interest and Income Taxes 63,686 63,332 5,713 57,973 Minority Interest 2,529 2,679 891 1,638 Income Before Income Taxes 61,157 60,653 4,822 56,335 Income Tax Expense   25,830       21,888     1,910     23,920   Net Income $ 35,327     $ 38,765   $ 2,912   $ 32,415   (1)   The Company went from a minority to majority ownership of Bingham, Osborn, and Scarborough in Q3 2007. Prior period financial information is included with Earnings in Equity Investments. Prior period AUM data is shown for comparative purposes as being included with the consolidated Company.   (2) The Company calculates its cash earnings by adjusting net income to exclude the amortization of the purchased intangibles (net of tax), the tax benefit on the portion of the purchase price which is deductible over a 15 year life, impairment, and certain non-cash share based compensation plans (net of tax). The tax savings are deferred under GAAP accounting but are included in cash earnings since the tax savings (lower tax payment) will be retained unless the acquired company is sold. The Company uses certain non-GAAP financial measures, such as Cash Earnings, to provide information for investors to effectively analyze financial trends of ongoing business activities.   (3) The Company defines Core Net Interest Margin as Net Interest Margin excluding the interest expense on the Junior Subordinated Debentures and a portion of the convertible bond that was used for the purchase of Charter Bank. The Company utilizes Trust Preferred Securities to assist in the funding of acquisitions and believes it is useful to compare Net Interest Margin excluding the impact of this acquisition funding vehicle.   (4) The Company calculates Return on Average Equity on a cash basis as Cash Basis Earnings divided by Average Equity.   (5) The Company calculates Return on Average Assets on a cash basis as Cash Basis Earnings divided by Average Assets.   (6) The convertible trust preferred debt was anti-dilutive for the 2nd quarter of 2007 and therefore excluded from diluted earnings per share, but dilutive for the year-to-date computation and therefore included. The separate evaluations for quarterly and year-to-date computations may result in year-to-date earnings per share that do not equal the sum of the quarterly earnings per share.