2017 Annual Report and Statement of ConditionIssued: March 2018

NORTHERN BANK YOUR PARTNER FOR GROWTHNMLS ID: 472275

Valued Customers and Colleagues,

On behalf of Northern Bank and the Mawn family, I would like to thank you for your continued confidence and loyalty. We are pleased to present you with this 2017 Annual Report, reflecting a year of strong growth, shared success and community giving.

We look forward to being your partner for growth for many years to come!

Sincerely,

James J. Mawn, President & CEO

OUR STORYAn Entrepreneurs Mindset

Success Built One Partnership at a TimeSteady Growth

Since we opened for business in 1960, we’ve been a different kind of bank. Privately-owned and founded by entrepreneurs, we have an eye for opportunity, we are able to make decisions quickly, and we take the time to partner with you.

We leveraged an opportunity this year with the launch of our new online division, Northern Bank Direct (northernbankdirect.com). Through Northern Bank Direct we are able to offer CD and Money Market accounts to customers nationwide, with rates among the best in the nation. In turn, this expanded pool of deposit accounts will fund additional lending to local customers.

Northern Bank - Total Assets

1990 - 2017

$2.06B

201720102005200019951990

Northern Bank for me was an easy choice. I have always chosen the local family-owned businesses because that is what I am!”

- Wally, Team Mechanical

After shopping banks extensively, we were surprised to find the best rates and superb service at the unassuming local bank right down the street.”

- John V. Melehov, CPA, Director of Finance Acton Medical Associates, PC

FULL SERVICE

2017 AWARDS & RECOGNITION

• Deposit Accounts• Business Loans• Commercial Real Estate Loans• Construction Loans

• Deposit Accounts• Personal Loans• Home Loans

Business Banking Personal Banking• Merchant Services• 1031 Exchange• Insurance

S&P Global Market Intelligence #1 Performing Bank in New England (awarded in 2017 for total 2016 performance)

2017 Banky™ Award awarded to the top 1% of community banks in America

2017 Readers’ Choice Award for Community Bank

Deposit Accounts In December 2017, this bank account comparison site recognized Northern Bank Direct’s 24-month and 48-month CD rates as the best in New England compared to similar length-of-term CDs

2017 Woburn Business of the Year Award

2017 WebAward Winner for outstanding website design

NORTHERN BANK & TRUST COMPANY CONDENSED STATEMENT OF CONDITION

ASSETS

LIABILITIES

EQUITY CAPITAL

TOTAL ASSETS

TOTAL LIABILITIES

TOTAL EQUITY CAPITALTOTAL LIABILITIES & STOCKHOLDERS’ EQUITY

Other AssetsPremises and Fixed Assets

Loans and Leases, Net of Unearned Income and AllowanceLess: Allowance for Loan and Lease Losses 23,150

1,374,747

99,779

3,228

29,492

167,681

65,677

26,220

$2,068,601

1,866,072

$ 1,829,719

$ 291,424

$ 4,222

$ 1,672,171

60041,495

164,786(4,352)

202,529$ 2,068,601

59,634

1,806,569

Loans and Leases, Net of Unearned Income Loans Held for Sale

Available-for-Sale SecuritiesSecurities:

Other BorrowingsOther Liabilities

Interest-Bearing Balances

Interest-Bearing

Noninterest-Bearing Balances and Currency and Coin

Noninterest-Bearing

Cash and Balances Due From Depository Institutions:

Deposits in Domestic Offices

Common StockSurplusUndivided Profits and Capital ReservesAccumulated Other Comprehensive Income

Outstanding Standby Letters of Credit

Pledged Securities

$6,894

55,996

______________________________

James J. Mawn, President & CEO

Securities are recorded at market value and the difference between market value and book value, $59,634,000 and $60,080,000 respectively, is shown net of taxes as a decrease of $336,000 to stockholders’ equity.

This statement has not been reviewed, or confirmed for accuracy or relevance, by the Federal Deposit Insurance Corporation.

December 31, 2017 (In Thousands)

COMMUNITY INVESTMENT

Major Donations in 2017:$250,000 to the James L. McKeown Boys & Girls Club of Woburn to help complete construction of their new Clubhouse

$51,000 to the Friends of Milano Center to purchase a van to assist Melrose senior citizens

$30,000 total distributed to 11 area food banks during the 2017 holiday season $25,000 to the National Brain Tumor Societyto fund research, education and patient support programs

$10,000 donation to Heading Home, Incincluding sponsorship of a mother and daughter’s milestone move from a shelter to their own apartment

You, our customers, make the work of our Northern Bank Charitable Foundation possible. Since 2012, the Foundation has provided financial support to non-profits and other community organizations doing work to strengthen the cities and towns of Middlesex County. Our charitable focus is on assisting our most vulnerable citizens and encompasses hunger relief, housing, education, and expanded youth and social services. The foundation also funds a college scholarship in the memory of long-time employee James McGarry.

In 2017 the Foundation provided contributions ranging from $1,000 to $250,000 to more than 30 organizations.

ORGANIZATIONS SUPPORTED IN 2017:Food Pantries

Bread of LifeCommunity Supper and Food PantryCor Unum Meal Center Council of Social ConcernLoaves & FishesMerrimack Valley Catholic Charities (Lowell Food Pantry)People Helping People Reading Food PantrySudbury Community Food PantrySunshine Gals The Elizabeth Peabody House Emergency Food PantryWestford Food Pantry

Housing Assistance

Habitat for Humanity of Greater LowellHeading Home Inc.Mission of Deeds

Youth and Social Services

Boys & Girls Club of Greater BillericaFriends of Milano CenterHope SudburyJames L. McKeown Boys & Girls Club of WoburnNashoba Learning GroupNuPathSmile MassWaltham YMCAYMCA of Metro North

Education and Financial Literacy

Budget BuddiesGoodnow LibraryJames McGarry ScholarshipJunior AchievementMinuteman Senior ServicesMystic Valley EldersOak Meadow SchoolTown of Chelmsford Scholarship

OUR TEAM

Executive Team

Directors

We couldn’t do what we do without these exceptional people. They are experts in their fields, constantly striving to enhance their professional knowledge and to mentor and teach others. They treat our customers like family, and they give generously of their time to the community causes close to our hearts.

Russell A. MawnBoard Member

Joseph M. BellinoBoard Member

Danielle S. BlackBoard Member

Brandon D. KellyBoard Member

John C. MartiniBoard Member

Mary-Elizabeth Mawn-Ferullo, Esq.Board Member

M. Catherine Riley, Esq.Board Member

Alicia Mawn-Mahau, Esq.Board Member

Robert L. McCrenskyBoard Member

Robert G. NaughtonBoard Member

Fred SalvucciBoard Member

John W. SullivanBoard Member

James J. Mawn, Esq.President & CEO

Donald P. QueeninExecutive Vice President

Francis KenneyEVP-CFO

Raymond ClarkExecutive Vice President

OUR LOCATIONS

Acton414 Massachusetts AveActon, MA 01720978-263-9501

Billerica482 Boston RoadBillerica, MA 01821978-667-4107

Burlington13 Center StreetBurlington, MA 01803781-272-2880

Chelmsford14 Littleton RoadChelmsford, MA 01824978-256-1552

Littleton265 Great RoadLittleton, MA 01460978-486-3543

Melrose514-516 Franklin StreetMelrose, MA 02176781-662-0200

Reading600 Main StreetReading, MA 01867781-569-2400

Sudbury430 Boston Post RoadSudbury, MA 01776978-569-1901

Westford45 Main StreetWestford, MA 01886978-692-9700

Woburn Center303 Main StreetWoburn, MA 01801781-933-6606

Woburn Main Office275 Mishawum RoadWoburn, MA 01801781-937-5400

Woburn West215 Lexington StreetWoburn, MA 01801781-937-5423

Headquarters 275 Mishawum Road Woburn, MA 01801800-273-6908

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