In the year that Dr. James King became a director of the Bank of N.T. Butterfield & Son Ltd., Jimmy Carter was the US President, the film “Grease” was released and Canadian pop star Nelly Furtado was born.

Yesterday, at the Bank’s annual general meeting, Dr. King showed some emotion as he formally retired from the board after a 29-year stint, having served as chairman for the last 10 years.

“It’s been an enormous pleasure and privilege to have been the chairman of what I consider to be a marvellous bank,” Dr. King told assembled shareholders at the Bermuda Underwater Exploration Institute.

“It is with sadness that I go, but in so going I know that I am leaving behind a team that I can only be proud of and hence I go with no worry and no concern.”

The outgoing chairman added that during his time on the board he had seen the bank grow from a “relatively small, Bermuda-centric bank into an international bank with operations in eight jurisdictions”.

He praised the Bank’s management team and the staff, who had worked with “dedication, creativity and enthusiasm” for the success of the company. “That is a rare in today’s business world and is something that should be celebrated, preserved and cherished,” he said.

Dr. King then handed over to his successor as chairman, the former Ace Ltd. chief executive officer Brian Duperreault, who thanked Dr. King and pointed out that during his 10 years at the helm of the board, shareholders had enjoyed total returns of some 800 percent.

Shareholders voted in favour of the appointment of two new board members, Appleby managing partner Shaun Morris and the former governor of the Bahamas Central Bank, Julian Francis. They will replace Dr. King and Rod Ferguson III, who also stepped down as a director yesterday.

Alan Thompson, president and chief executive officer of the Bank, which is now known as Butterfield Bank, summarised a successful 2006 which brought record profits.

“We may not be that large a bank on the world scale, or offer a range of services that is as widely diversified as some other providers, but knowing what we do well and continuing to focus on those businesses has enabled us to add value for our shareholders each year and methodically grow our business,” Mr. Thompson.

“At year end, we had achieved a record net income of $134 million, an increase of 22.6 percent over last year. Our assets had grown to over $11 billion and we enjoyed gains of over 20 percent versus 2005 in the size of the loan book, in customer deposits, and assets under administration.

“We managed to turn those gains into a gain in net income of roughly equivalent magnitude, largely because of our success in containing operating costs. The efficiency ratio compares our non-interest expenses against revenues. We slightly improved this ratio, lowering it to 64.8 percent from 66.4 percent, and will work to continue to improve it going forward.”

Mr. Thompson added that per-share earnings totalled $4.74, a gain of 20 percent year over year, and that the Bank’s stock price had increased to $56.25 by the end of the year, contributing to an increase of market capitalisation to $1.68 billion.

“Overall, through our business building and cost containment efforts, we managed to increase shareholder value (defined as the increase in share price plus reinvestment of dividends) by 36.8 percent this year, as compared to the increase of 31.4 percent last year,” the CEO added.

Mr. Thompson said the Bank now ranked as the 12th largest administrator of funds-of-hedge-funds and the 14th largest administrator of single hedge funds in the world, according to the magazine, HFM Week.

He also mentioned two new overseas units, Butterfield Asset Management (Switzerland) Ltd., which was set up in November last year, and Butterfield Fund Services (Canada) Ltd., which opened in Halifax last month with a staff of some 12 people.

“Our objectives for BFS Canada are two-fold: in the short term to take on some of the workload currently handled in Bermuda and Cayman to ease pressure on staff who are currently running at full capacity and, over the long term, to be a base from which we provide services to North American hedge funds.”