Good morning and welcome to Webster Financial Corporation's first quarter 2010 results conference call. This conference is being recorded. Also this presentation includes forward looking statements within the Safe Harbor Provision of the Private Securities Litigation Reform Act of 1995 with respect to Webster's financial condition, results of operations and business, and financial performance. Webster has based these forward-looking statements on current expectations and projections about future events. Actual results may defer materially from those projected in the forward looking statements. Additional information concerning risks, uncertainties, assumptions and other factors that could cause actual results to materially differ from those in the forward-looking statement is contained in Webster Financial’s public filings with the Securities and Exchange Commission including our form 8-K containing our earnings releases for the first quarter of 2010. I'll now introduce your host Jim Smith, Chairman and CEO of Webster. Please go ahead sir.

Good morning and welcome to Webster's first quarter earnings call and webcast. You can find our earnings release that was issued earlier this morning along with the slides and in depth supplemental information that accompany this presentation in the investor relations section of our website websterbank.com. I'll provide an overview of the quarter and talk about our regional bank strategy and then turn it over to Jerry Plush, our Chief Financial Officer and Chief Risk Officer to walk through the balance of today's earnings presentation. Then we'll open it up for your questions. I'm pleased to say that the first quarter was marked by many positive developments including Webster's return to profitability from continuing operations. A small profit to be sure but a large step in the right direction. A lower provision for loan losses coupled with an improved margin growth in core deposits and a higher level of earnings assets were the primary drivers. Pre-tax, pre-provision earnings of $57.3 million held steady from the previous quarter and increased $10 million from a year ago. The lower loan loss provision down by a third from Q4 ‘09 was driven by improving credit quality trends some strongly so, including nonperforming loans down 6.5% from Q4 to their lowest level in a year and charge-offs down 22% from Q4. Since the provision continued to exceed net charge-offs in the quarter though by less than in previous quarters, loan coverage increased to 3.16% and NPL coverage reached 99%. The reduction in NPLs were driven primarily by continued declines in non-accrual loans and a greater number of cures and exits. Commercial real estate, residential consumer lending and the discontinued liquidating portfolio all saw declines in NPLs while in C&I asset based lending NPLs rose and the other categories in aggregate declined. Delinquencies remained stable…

Thank you Jim and good morning everyone. Turning to slide nine, here we provide a view of core earnings for the first quarter. We're clearly pleased to show a return to positive pretax results for Q1 and to show pretax pre-provision earnings of $57.3 million essentially equal to the fourth quarter of 2009. We also note on the slide that the $57.3 million includes the impact of the Freddie Mac buybacks of about $1.4 million, we’ll provide some more detail on that in a minute. So again we've outlined certain items to take into account to get from the pretax, pre-provision results. So we adjust for non-core items such as the $4.3 million in gains on the sale of investment securities, the loss of $3.7 million on the write-down of pool trust preference securities and this reflects a change in our credit valuation methodology from insurance companies. We see this adjustment as exclusive to the quarter only given it was a methodology change in how we assess the underlying issuers. We also exclude $10 million in REO and repossessed equipment write downs and $11 million of the previously announced fraud related costs as well as the $43 million provision expense for the quarter. So overall adjusting for these items you can see that the continued strength of our underlying operating performance is apparent in the quarter and more detail will be provided in our core performances review in the next slide. So here on slide 10, here's a look at the drivers of core pretax, pre-provision earnings. You can see the strength from a year ago in growth of almost $10 million in earnings through a combination of an increase of 29 basis points in the margin and a $324 million increase in average interest earning assets. In comparison to…

Thank you, Jerry. Our first quarter results are a major step forward. Webster bank has returned to profitability. Credit trends have been positive. Webster is emerging from the most challenging period as a better, stronger company endowed with a team of talented motivated bankers. Our regional bank strategy is clear and we're committed to executing it in a manner that delivers improving returns on capital. That concludes our prepared remarks we're pleased to take your questions.

(Operator Instructions) Our first question is from Ken Zerbe with Morgan Stanley. Please proceed with your question. Ken Zerbe – Morgan Stanley: First question on TARP repayment; I heard your comments that you wanted to do it in a shareholder friendly manner and it seems that you're off to a good start with $100 million. Going forward, are there any other considerations that we should be aware of that would lead you to try to repay it sooner rather than later, which may have an increased likelihood of an equity issuance or are you comfortable sort of repaying it $100 million every couple of quarters for the next year or so?

Well, it's a great question Ken. There's a lot of moving parts there and I think it's a question of timing when is the best time to repay that is providing maximum consideration from a shareholder perspective. So, we are willing to stretch this out for a while to make sure that we raised a minimum amount of common equity that maybe required in order to repay it but it's hard to put an explicit timeframe on it right now. So, as I indicated the first step was to be able to pay back $100 million without a capital raise was an important step forward and it validates the capital strength of course. And now as our credit performance continues to improve and profitability as well, we'll be in a stronger position to repay we think with less need for a capital raise. But we need to see how all the variables play out as to what the timing ought to be and I would say that if we were to pay it back sooner rather than later there is a high probability there would be some kind of capital raise that would be involved. I would do only indicate that we would do our utmost to minimize the amount of common equity that might be involved. Alternatively, we could wait longer term and balance that against other desires to exit the program in order to pay a substantial portion back out of earnings going forward but I think we just have to evaluate as we go and just reassure that whatever decision we make we'll make it at that time in the best interest of shareholders. Ken Zerbe – Morgan Stanley: In the past you mentioned that you were worried that you could potentially see some competitive pressure from people who don't have TARP basically using that against you. Now, that you started to repay, do you still feel those pressures?

We think repaying it was a very big step forward in that regard to show momentum and to show the capital strength of the company in the process but that is out there as a consideration. We don't think that it's a negative for us at this point but it's something you have to continue to watch and so if others don't have the capital and you do that's one of the elements that you have to weigh in your repayment plans.

Thank you. Our next question is from Dean Choksi of Barclays Capital. Please proceed with your question. Dean Choksi – Barclays Capital: Good morning, glad to hear that you are back on the offensive on some of your initiatives. I think Jerry you talked about the expense structure being up going forward, kind of given all the internal activities that you're doing how should we think about the expense structure going forward and then kind of when do you expect to see net loan growth or when do you kind of see the benefits of that?

Dean, it’s Jerry. First on the expenses, the guidance I wanted to try and provide just in terms of generalities is there's two lines to be thinking of that we believe will definitely increase in Q2 and that'll be again around comp and benefits and around marketing. Marketing is absolutely, to tie into Jim's comments we're rolling out a very strong series of the campaigns right now whether it's on TV, whether it's radio or whether it's direct mail, whether it's on billboards. So you would expect to see that continuation if not even slightly higher marketing expense in the second quarter and then you'll begin to see some – that to tail off in Q3 and Q4. As it relates to compensation expense, I think you would see us – this would be natural in terms of the extended hours initiatives and all the hiring plans that we've listed out, and the update in some of the strategic initiatives. So they're sort of the higher areas that to expect. We are running a series of – you should expect, however, the OneWebster savings that'll continue to come through. You’d expect us to continue to work away from a procurement perspective, from an efficiency perspective and other line items in Q3 and Q4 and see us trying to adjust and if not, not only completely offset, begin to bring expenses down in those quarter. Dean Choksi – Barclays Capital: Do you have a sense of kind of how much expense can be removed through OneWebster that's remaining?

Yes, we have about $5.5 million in remaining ideas and the need to be executed on and as you will start to see the benefits of that and again, that's annualized that you'll see start to flow through. So you’ll only get a part of that obviously in Q3 and Q4 and then in addition it'll be based on the success of how we continue to execute on our continuous improvement idea generations there after. But we do have opportunities that we have identified and you should see several million dollars worth the benefit in each quarter thereafter. Dean Choksi – Barclays Capital: Great, thank you.

Sure, thanks Dean. Oh, Dean, you did ask, wait, I think there was a comment there about loan demand. I would think on the loan side clearly like probably others have reported, we continue to see softness in the market. I do think that the real positive for Webster is the continued buildup on the small business as well as in the middle market areas as we continue to add folks, as the folks we've already added gain traction. We still look forward to some nice growth because we're very, very focused on those specific areas. I would think that you'd see some moderation if not rebound in the residential area and I would think that we'd probably stabilize more on the consumer side as well so I think generally speaking, you know, the first quarter was really a transition quarter for us as an organization. I think we talked about that a lot in the fourth quarter that really because of the plan declines that we saw in AVL and equipment finance and Jim gave some perspective in terms of where those balances will settle out. We would expect that we'd pretty much be there within the next couple of months and then you'd begin to see sort of the new areas where we're very, very focused particular in small business and middle market begin to take hold and really show consistent growth. So we tend to think that the additions again, the addition to staff, the existing complement and just the way we're positioning ourselves in the market will be our competitive advantage to gaining some share back there.

Our next question is from the line of Amanda Larson with Raymond James. Please proceed with your question. Amanda Larson – Raymond James: You have some very strong trends in the cures and I just wanted to know if there was any specific loan bucket that was driving the strong trend.

Amanda, it’s Jerry. The one point and that's why I wanted to bring out the curing that's happening in terms of all the residential modifications, that's probably the single category where we're seeing the best experience in terms of the fruits of all the work that was done over six months ago now coming back in. So I would say that category in particular. But I think there is – obviously we talked a little bit on the commercial side that we've had a couple of credits that came back in as well. So I think it has to really point toward the modification program that we talked about a lot last year is really showing some of the benefits and we're in a very, very low redefaults rates, that's a huge, huge positive for us. And I think that's the complement to the group and how they've restructured it. I think when the loans were restructured they were done well and if they were right offs it needed to be taken at that point in time, they were taken so. I think that we've set a lot of customers out for success, and so ourselves for success I think with the way that program has been managed. Amanda Larson – Raymond James: Okay, great. I appreciate your commentary on the projections for growth. I was wondering to what degree do you believe consolidation in New England is necessary for growth in your legacy footprint in Connecticut with so many strong players there.

Amanda, this is Jim. Our focus is on organic growth and we believe that with the strategy and the initiatives that I outlined, which is one of the reasons I wanted to do that that we would be able to achieve our goals through organic growth. So we are not looking so much at acquisitions at this point but do believe that as our currency recovers that over time there may well be the opportunity for us to make acquisitions or likeminded partners that decide that the market is a little bit too crowded. And as you know, historically we've done very well by combining with other institutions. So we see that as part of our plan but not the focus at this point. We also think that while there may well be significant consolidation in New England over the next several years that it's not as immediate right now but the focus is more likely to be on the very few assisted transactions that may come up in this region but that there will be consolidation in New England down the line and we would like to be part of it.

Our next question is from Damon DelMonte with Keefe, Bruyette, & Woods. Please proceed with your question. Damon DelMonte – Keefe, Bruyette, & Woods: Good morning guys. How are you? Jerry, I was just wondering if you could recap your comments at end of your remarks regarding the NIM and fee income going forward.

Yes, I think Damon if you were to look at the NIM for Q1 normalized without the buybacks it probably would have been around 331. If you look at the higher level of buybacks we're expecting from the Fannie Mae buybacks, that probably takes about 6 basis points or so off of that number. And basically in order to achieve that level and then continue to try and work up from there during the quarter, we're going to need to be very, very diligent as it relates to deposit pricing and continue the discipline and also be very disciplined around loan pricing. And again our expectations are you'd see a rebound from that back more normalized in Q3. So hope that's helpful and it gives you a little more perspective around what to think. So, do we think there is up sight to try and offset some of the buyouts? Yes, we do and I think that the flip side is it does really depend as well though on the loan mix that's booked during the quarter and in terms of some of the pricing decisions we make there. Damon DelMonte – Keefe, Bruyette, & Woods: Great, thank you very much. And then in regards to your core fee income going forward, could you just recap your comments on those lines of business?

Sure. Deposit service fees will tick up because Q1 tends to be lower transaction volume quarters but just seasonality. And so we'd expect a rebound there. Generally speaking, I would expect that to more than offset the drop that we probably see in other income, there was a lot of ins and outs in other income during the quarter. So if you were to be thinking about consistency to Q1, that's probably not a bad way to think about it. Damon DelMonte – Keefe, Bruyette, & Woods: With respect to your securities portfolio, that has grown to be about 29% of total assets, I think that’s up from 20% a year ago. Kind of where do you see that shaping out in the coming quarters?

Damon, in my comments one of the things I wanted to try and highlight was the fact that we've got several billion of that in AFS and we also -- you have to remember there's fairly high prepaid speed happening in this portfolio. It’s probably panned out at a $100 million or so a quarter or excuse me, a month within the quarter. So you've got several hundred million dollars potentially that can come out of that portfolio in any given quarter just given where interest rates are. And then also with all those securities in AFS, it gives us a lot of flexibility to use that for funding loan growth. I don't think it's our attention to grow the portfolio further. We thought that it was necessary to deploy the inflows that we were fortunate enough to receive and certainly we want everything. We talked a lot about the deposit side, it’s all about organic, it's all of us and you can hear in a lot of the remarks today that's the way we're thinking about the loan side and there is really tangible evidence of that taking hold. So the expectations are we want to see that the loan side and get ourselves back to a lot more normalized loan-to-deposit ratio that's back in the probably upper 80s to 90% type of range and that would be the goal as well. So I think a combination of not really wanting to grow the investment portfolio further, being able to use the cash flows from that to fund loan growth coupled with a desire to get that loan-to-deposit ratio back now as things stabilize more to what we'd refer to as more normalized level for us going forward.

Our next question is from Bob Ramsey with FBR Capital Markets Corporation. Please proceed with your question. Bob Ramsey – FBR Capital Markets Corporation: As you're looking at the aging of the modified loans, do you expect that you'll see a similar amount of NPL cures in the second quarter as the first?

Good question. We would expect to see a fairly consistent number not necessarily as high a number. So if you think about the program and just in terms of the timing and sort of the six months that we take to make sure that these loans are performing well, we'll take them back into accrual status. We probably had the high peak in terms of timing wise. Bob Ramsey – FBR Capital Markets Corporation: As you think about the provision here, do you think that the build over charge-offs will continue to narrow? Obviously there's not a lot of cushion there and when do you think you will switch to a position of in less than charge-offs?

Bob, good question. I think we want to remain cautious which is why we continue to be actually slightly above. I would expect we want to have more certainty in Q2 probably would say if from the chair today make the observation that we'd probably offset charge-offs and I think that that cautious approach will pay dividend down the road. So I think in terms of being anxious to try and get into – are we going to start to charge off more than we provide, I think that maybe something we’d look at in the second half of the year. Clearly we think that charge-offs will remain at a pretty good clip like we saw in the first quarter throughout the course of 2010 but that doesn't necessarily mean in Q2 or excuse me in the second half rather of the year that we would necessarily continue to replenish at the same rate. But I would think for Q2 we want to make sure we're absolutely certain in terms of – and I think that's just prudent management. We're trying to be cautious about this, make sure there is no downward trends that we see. Bob Ramsey – FBR Capital Markets Corporation: As I think about the diluted share count for you guys, once you do swing back to profitability assuming that stocks sort of where it is today, what is a good diluted share count to factor in (inaudible) TARP warrants?

I think in terms of what we've got projected for Q2 through Q4 we're probably around 81 million shares, if I've got that number accurate, maybe a slight tick below might be 80.7 rising to 80.9, but gives you a pretty good band within which to work.

Our next question is from Matthew Kelley with Sterne, Agee & Leach. Please proceed with your question. Matthew Kelley – Sterne, Agee & Leach: Hi, guys. On the Freddie buyout, what was the actual dollar amount that was bought out because there are two issues; does your premium amortization but then you also have a lower investment yield, so curious with the dollar amount on the Freddie buyout and then similar overview of the Fannie buyout for Q2.

Hey, it’s about $45 million that came out and then you could probably roughly say twice that amount, so be in that range maybe around $80 million related to Fannie. Matthew Kelley – Sterne, Agee & Leach: Okay and the reinvestment yields, how much lower would they be on that $125 million?

Maybe 1% or so. Matthew Kelley – Sterne, Agee & Leach: Okay. So the $1.4 million this quarter, the 3 basis points, that's just the premium amortization, correct?

Yes, that's all you can take, yes, Matt, right. Matthew Kelley – Sterne, Agee & Leach: No, but I mean just going forward you got 120, down 100 dips.

Right, and you got it. Matthew Kelley – Sterne, Agee & Leach: OK. Then on the Reg E changes, the $15 million, just to confirm that's a full year number correct?

Yes, that would be the second half assuming zero opt-in. Yes, that's just a raw number.

And what Jim’s comment was very consistent because I made a statement in the fourth quarter, we talked about a range of anywhere between $5 million to $7 million and we wanted to actually give you a broader perspective of which Jim did of no opt-in because what we think our exposure could be. So it gives you a sort of a range of thoughts that we've been having around potential success rate or not, we're not going to know that until we get to the third quarter and actually walk through the experience because again, remember this is consume optionality, it’s up to the consumer on the opt-in process here. And you could -- that's going to depend on everyone’s individual situation what they want to do. But I think the way we've laid out the plan, we’ll talk more about obviously in the second quater. Matthew Kelley – Sterne, Agee & Leach: But just to be clear the $5 million to $7 million is loss potential income in the second half of the year.

No, per quarter. Matthew Kelley – Sterne, Agee & Leach: Per quarter, okay.

So we're saying that gives you a range of potential that we think that know if you were to look at anywhere between $10 million to $15 million, $15 million would be the maximum but that depends on opt-in rates. And we've got very – as Jim said, we're going to be very guarded about this. We know how we're going to roll out the program, we're very active in terms of executing on our strategy around that and we'll certainly be in a position to talk more about that on the second quarter call.

We've got a good program. Matthew Kelley – Sterne, Agee & Leach: Fair enough, and then just last question. As you move to the positive side and into the black, what should we be thinking about the tax rate?

Twenty percent for the balance of the year. Matthew Kelley – Sterne, Agee & Leach: Okay, and then for next year?

I think you're going to look at something higher than that. I think you'll see some gradual increase. We'll give you some guidance on that when Terry makes the rounds.

Our next question is from Collyn Gilbert with Stifel Nicolaus & Company. Please proceed with your question. Collyn Gilbert – Stifel Nicolaus & Company: Jerry, just a question on the credit front. You were kind of cautious at the beginning of the year, committing a little reluctant to commit too much to a positive outlook on credit because of the CRE and kind of equipment finance. Just the performance that you saw this quarter and I know you had indicated that if you see stability in the second quarter you'll feel better. Have you seen trends change in CRE and equipment finance that has given you more confidence or is it kind of the overall market or maybe just talk a little bit about that?

Yes, Collyn, I think and John's here today too and he'll probably have an observation or two, but I think I'll take maybe one after I'm done. In terms of -- I think it's overall -- what we talked about and when you look at the detail slides, there's really good trends pretty much throughout the portfolio. Clearly on the charge-off side, you saw better trends from equipment finance as well as from pre. But I think we still continue to feel very good about the way the portfolio has been managed on the pre side, very good about the way we're working out the problem credits. Sponsors continue to step up, we continue to see some good signs in that portfolio. And the cautious comment is we're not out of the woods yet but it turns out the industry what we think in particular for us, it’s better at this point in time to remain a little more cautious given another quarter before we say we've definitely seen -- we've got more than a quarter or two's worth of data to say that we have absolutely got rock solid positive trends but the data, sure points to it across the board when you look at the declines in delinquencies, the declines in NPLs, the declines in charge-offs, the drop off as it relates to the provision expense that we've had a book related to each portfolio. Regarding equipment finance, clearly I think what you saw us do towards the latter part of 2009 was be very, very proactive to try and address and charge off a lot of the problem credits that we had within that portfolio and clearly you're starting to see some better experience from that portfolio, that was pretty evident in the first quarter. So I think net net we are seeing and feeling good about the portfolio and you always do a touch wood and you just again, given all the uncertainty of the economy among, just in terms of particular around employment, but in equipment finance, it's a lot of small business owners and if you see that their demands starts to pick up, you've got a lot of people then that obviously will be getting stronger cash flows than from the increased orders of business that they get and we should see more stabilization as you think about the balance of 2010. Collyn Gilbert – Stifel Nicolaus & Company: Okay, that's helpful. And then just, Jim, I know you have in the past mentioned a targeted kind of efficiency goal of 60%. Are you still on track you think to be able to achieve that?

Hey, Collyn, it's Jerry, Yes. And I think the efficiency goal has to come from a combination of two things. Clearly we've got to continue to be after the expense side, we're going to continue to look at things like consolidation, opportunity, centralization opportunities of facilities but we've not been reticent to spend money here in the midst of all the things that we've been doing to really invest in the franchise and to build the earnings engine of the franchise. And I think you can clearly see with all the business development officers that we're adding and the fact that we're pretty bullish about Westchester and putting a regional headquarters there. There’s definitely some increased commitment that will drive expenses and the end result of that is we believe that they pay off with a lot more revenue opportunities in a lot deeper stronger customer relationships. So it's got to come as well from the revenue side, it's got to come from greater asset size, greater earning asset size predominantly. So I hope that's helpful because I don't think it's – people tend to spend a lot of time focused on that. I know we've had some conversations in the past and it's not to say that we don't think that continuing to be very hawkish around expenses looking for renegotiations of contracts, looking for our department structured appropriately, should we look to centralized very decentralized, should we look to consolidate; a lot of those ideas are continuing to be in play and that's with the whole OneWebster initiative aside, put that to the side as it relates to the asset side of the company, we’ve got to grow our earning assets and that's another, another, another big lever that we've got to pull in that.

Collyn, I just wanted to add something if I could that in the context of getting a return on our capital we see that the efficiency ratio would have to be 60 or less than that over time in order to achieve that. But to Jerry's point some of that maybe driven by revenue rather than simply by reducing cost. So we wouldn't say look for 60 in the second quarter or the third quarter of 2010 in part because we think now is the time to be investing our future, to create the opportunity for more revenue whether it’s that extended hours program we're taking about or the business bank because there are other things that were mentioned here today. So as much as we're doing our best to be as efficient as we can on the cost side, we're also making investments that cause expenses that could put the ratio even a little bit higher over the near term even though we think longer term we would have to be in that range to be competitive and to generate the kinds of returns we think we're capable of. Collyn Gilbert – Stifel Nicolaus & Company: Okay, that is very helpful. And then one final question on the -- I just want to make sure I got your comment right, Jerry. On the securities front you said you're not interested in really growing that, so we probably won't see the kind of growth rate in the securities book going forward that we have seen in the last few quarters.

Yes, and if anything we may keep it at a stable level depending on how we see loan demand in the second quarter but there really is -- there maybe some increases that relates to the average, Collyn, I think that's one of the things. So in terms of maybe point to point, you won't see it but in terms of the average for the quarter there could be a popup there probably around the $100 million or so. But the one other thing to take into account again we really want to see -- we're out there and we're being proactive, we really want to lend and I think it's not just lend, we really want to develop customer relationships and we've been very successful on the deposit side and we've really got to – as we see some economic recovery starting to kick through the year and our ability to take away market share from competitors, that's really the key thing. So this quarter is a lot about execution for us as an organization and I think in terms of signalling we certainly don't want to signal that our intent in terms of getting to earnings just to grow the investment portfolio.

Thank you. Mr. Smith, there are no further questions at this time. I'd like to turn the floor back over to you for closing comments.

Well, thank you very much. Thanks everybody for being with us today. We look forward to seeing you soon.