The Bank of N.T. Butterfield & Son Limited (“Butterfield Bank Group” or “the Group”) yesterday reported first quarter net income of $36.3 million, the second highest on record for the Group and up 1.8% year on year. Pre-tax net income, at $37.8 million was up 1.4% on a year ago. The return on equity for the quarter, at 22.9%, exceeds the Group’s target of achieving a return of over 20%. Diluted earnings per share were $0.38, up 1 cent on 2007 when restated for the impact of the stock split in August 2007 and the stock dividend in February 2008. Other financial highlights include:

• Non-interest income up 16.4% at $58.9 million
• Record net interest income up 13.6% at $67.3 million
• Record customer loans up 11.0% at $4.2 billion
• Record total assets up 13.0% at $12.8 billion
• Assets under administration up 14.8% to $143.3 billion
• Assets under management up 4.9% to $11.3 billion
• Net interest margin improved to 2.24% from 2.19%

Alan Thompson, President & Chief Executive Officer, commented: *“Against a backdrop of ongoing instability in financial markets, we continue to be pleased with the Group’s performance. There were certainly economic challenges in many international markets during the quarter, involving decreasing interest rates and a general widening of credit spreads across most industry sectors, but Butterfield Bank Group’s core businesses generated satisfactory results. We saw solid increases in loans and deposits, and good revenue growth in our Asset Management, Fund Administration, and Trust and Custody businesses. We also made good progress integrating the Bentley Reid Group businesses (acquired in late 2007) into the Butterfield Bank Group operating model. Although greenfield expansion into established markets is often difficult, we continue to be pleased with the business development efforts of our Swiss wealth management offices.”*

Butterfield reports that its Bahamian businesses – **Butterfield Private Bank** and **Butterfield Funds Services** – achieved net income of $0.7 million, up from $0.6 million a year ago. Total revenues were up year on year by 15.5% to $3.1 million, reflecting strong growth in net interest income and fees earned from trust services. At year-end, total assets were $188 million compared to $170 million a year ago.

The Butterfield Bank Group offers a full range of community banking services in Bermuda, Barbados and the Cayman Islands, encompassing retail and corporate banking and treasury activities. In the wealth management area, the Group provides private banking, asset management and personal trust services from its headquarters in Bermuda and subsidiary offices in The Bahamas, the Cayman Islands, Guernsey, Switzerland and the United Kingdom. The Group provides services to corporate and institutional clients from offices in Bermuda, The Bahamas, Canada, the Cayman Islands and Guernsey, which include investment and pension fund administration, asset management and corporate trust services.