Exhibit 99.1

                     FIRST LITCHFIELD FINANCIAL CORPORATION
                 13 North Street, Litchfield, Connecticut 06759


News Release
For Immediate Release

       First Litchfield Financial Corporation Announces Six-Month Earnings

Litchfield,  Connecticut, August 1, 2008--First Litchfield Financial Corporation
(trading  symbol:  FLFL.OB) (the  "Company"),  the holding company for The First
National Bank of  Litchfield  (the "Bank")  reported  earnings for the three (3)
months and six (6) months ended June 30, 2008.

Net  income for the  Company  for the six months  ended  June 30,  2008  totaled
$1,115,000,  representing  an  increase  of  $130,000,  or 13% from  earnings of
$985,000 for the same period in 2007. Basic and diluted net income per share for
the six-month  period ended June 30, 2008, was $.47 per share,  as compared with
$.42 basic and diluted net income per share, for the same period in 2007.

Earnings for the second quarter of 2008 totaled  $616,000,  which is an increase
of 6% from second quarter 2007 earnings of $582,000. Quarterly basic and diluted
net income per share for 2008 were $.26 per  share,  compared  to $.25 per basic
and diluted share for the same period in 2007.

Net interest income for the second quarter of 2008 increased $411,000,  or 12.4%
from the second quarter of 2007. The tax equivalent net interest margin improved
from  3.02% in the second  quarter  of 2007 to 3.10% for the  second  quarter of
2008.  The  increase  in the net  interest  income was due to  increased  income
attributable to higher levels of earning assets.  Average earning assets for the
second quarter of 2008 totaled $506 million,  an overall increase of $49 million
from the second  quarter of 2007.  Average  loans and  leases  increased  by $31
million, or 10.0%, while average investments increased by $16 million, or 10.8%.
The increase in earning  assets came from organic  growth in commercial  leasing
and lending as well as increases in the securities portfolio.

Net interest income for the first six months of 2008 totaled  $7,290,000,  which
was an increase of $806,000,  or 12.4% from the same period in 2007.  Similar to
second  quarter  results,  both the increase in the volume of earning  assets as
well as increased net interest  margin  contributed  to the  improvement  in net
interest income. The net interest margin (net interest income divided by average
earning assets) was 3.08% for the six-month period ended June 30, 2008 which was
an increase of 14 basis points from the margin of 2.94% for the six months ended
June 30, 2007.  These results are  reflective of the Bank's  ability to decrease
funding  costs to a greater  degree  than the  decrease in the return on earning
assets.  Average  earning  assets for the first six months of 2008  totaled $496
million which was $35 million,  or 7.6% above  average  assets for the first six
months of 2007.  Growth  during the first six  months of 2008 was in  commercial
loans and in lease  receivables  which were up $6.3  million  and $7.0  million,
respectively, since year-end 2007.

<PAGE>

President  and CEO,  Joseph J. Greco  stated,  "I am pleased  with the growth in
earnings in this  challenging  economic  environment.  Our balance sheet remains
strong.  Our lending  practices are  conservative  and we follow prudent lending
standards  that  are  thoroughly   examined  by  Federal  regulators  to  ensure
performance, soundness and risk management."

As of June 30, 2008,  deposits  totaled  $344.8 million which was an increase of
$9.1 million over the year-end level.  Growth was primarily in time certificates
of deposits  which  increased by $8.7  million  over the year end balance.  This
increase  is  attributed  to the  consumer's  preference  towards  the safety of
FDIC-insured  deposits and continued market penetration due to the Bank's branch
expansion within the last two years.

The Bank  increased  its  provision  for loan and lease losses during the second
quarter  and for the first six  months of 2008.  The  provision  for the  second
quarter of 2008 totaled $137,000 as compared to the second quarter of 2007 where
no provision was  recorded.  On a  year-to-date  basis,  the  provision  totaled
$212,000, which was an increase of $107,000 over the six-month provision through
June 30,  2007.  The increase in 2008 was reflects of the growth in the loan and
lease portfolio and the potential effect of economic  uncertainty on the quality
of the Bank's loan and lease portfolio.

Year-to-date  noninterest  income for the quarter and six months  ended June 30,
2008 totaled $934,000 and $1,790,000, respectively, and were up 13.0% and 10.4%,
respectively,  over the same  periods in 2007.  In both  comparisons,  increased
noninterest income resulted from higher levels of banking service charges,  such
as overdraft and ATM fees, loan fees, cash management income and bank-owned life
insurance.

Second quarter and six-month  noninterest expense for the periods ended June 30,
2008  totaled  $3,824,000,  and  $7,623,000,  respectively  and  represented  an
increases of 10.8% and 10.3%,  respectively compared to similar periods in 2007.
Increases  in   noninterest   expenses   resulted  from   staffing,   occupancy,
advertising,  exam,  audit and consulting  fees.  Increased  salary and benefits
expenses were due to additional  compliance  personnel and an increased emphasis
on  commercial  and small  business  development.  Costs for exam and audit fees
increased due to costs for regulatory reporting,  compliance and internal audit.
The increase in  advertising  is due  primarily to the Bank's image  campaign as
well as product and publicity promotions.

Statements  contained in this news release  contain  forward-looking  statements
within the  meaning of the  Private  Securities  Litigation  Reform Act of 1995.
These statements are based on the beliefs and expectations of management as well
as the  assumption  made using  information  currently  available to management.
Since these statements reflect the views of management concerning future events,
these statements involve risks, uncertainties and assumptions,  including, among
others:  changes in market  interest  rates and  general and  regional  economic
conditions; changes in government regulations; changes in accounting principles;
and the quality or composition  of the loan and investment  portfolios and other
factors that may be described in the  Company's  quarterly  reports on Form 10-Q
and its annual report on Form 10-K,  each filed with the Securities and Exchange
Commission,  which are  available at the  Securities  and Exchange  Commission's
internet website (www.sec.gov) and to which reference is hereby made. Therefore,
actual future  results may differ  significantly  from results  discussed in the
forward-looking statements.

The First  National  Bank of  Litchfield  is a  community  bank  operating  nine
full-service  banking offices in Canton,  Goshen,  Litchfield,  Marble Dale, New
Milford,  Roxbury,  Washington  and two in  Torrington,  Connecticut.  The  Bank
maintains a full-service Trust department that offers asset management,  custody
and  estate  settlement  services  to  individuals,  non-profit  and  commercial
customers.  Additionally, the Bank offers non-deposit retail investment products
such as mutual  funds,  annuities and insurance  through its  relationship  with
Infinex  Investments,  Inc.  The Bank's  subsidiary,  First  Litchfield  Leasing
Corporation,   provides  middle-market  equipment   leasing/financing,   to  the
commercial  markets of  Connecticut  and  Massachusetts.  The Company's  website
address is www.fnbl.com.

Contact:
  Joseph J. Greco, President and CEO
  (860) 567-6438


                        (selected financial data follows)


<PAGE>

                     First Litchfield Financial Corporation

                      Selected Consolidated Financial Data
                                   (Unaudited)

Period end balance sheet data:                            June 30,
                                                   2008                2007

Total Assets                                 $ 544,630,000       $ 489,919,000
Loans, net                                     337,242,000         308,156,000
Investments                                    152,223,000         136,049,000
Deposits                                       344,758,000         333,289,000
Borrowings                                     169,436,000         124,632,000
Stockholders' equity                            25,362,000          25,775,000

Book value per share                                 10.75               10.87
Tangible book value per share                        10.75               10.87
Leverage ratio                                        7.34%               8.03%
Shares outstanding                               2,360,283           2,371,685

                                                      For the Three Months
                                                         Ended June 30,
                                                   2008                2007
Operating results:
Net interest income                          $   3,712,000       $   3,301,000
Securities gains, net                               21,000                   0
Total noninterest income                           934,000             827,000
Loan loss provision                                137,000                   0
Total noninterest expense                        3,824,000           3,452,000
Income before tax                                  685,000             676,000
Income tax expense                                  69,000              94,000
Net income                                         616,000             582,000

Earnings per share (basic)                             .26                 .25
Return on average assets                               .46%                .48%
Return on average equity                              8.99%               8.89%

                                                      For the Six Months
                                                        Ended June 30,
                                                   2008                2007
Operating results:
Net interest income                          $   7,290,000       $   6,483,000
Securities gains (losses), net                      33,000             (14,000)
Total noninterest income                         1,790,000           1,621,000
Loan loss provision                                212,000             105,000
Total noninterest expense                        7,623,000           6,909,000
Income before tax                                1,245,000           1,091,000
Income tax expense                                 130,000             106,000
Net income                                       1,115,000             985,000

Earnings per share (basic)                             .47                 .42
Return on average assets                               .42%                .40%
Return on average equity                              7.93%               7.36%


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