MAINE
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01-0413282
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(State or other jurisdiction of
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(I.R.S. Employer
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incorporation or organization)
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Identification No.)
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2 ELM STREET, CAMDEN, ME
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04843
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
¨
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Accelerated filer
x
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Non-accelerated filer
¨
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Smaller reporting company
¨
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(Do not check if a smaller reporting company)
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PAGE
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PART I. FINANCIAL INFORMATION
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ITEM 1.
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FINANCIAL STATEMENTS
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Consolidated Statements of Condition - June 30, 2015 and December 31, 2014
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Consolidated Statements of Income - Three and Six Months Ended June 30, 2015 and 2014
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Consolidated Statements of Comprehensive Income - Three and Six Months Ended June 30, 2015 and 2014
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Consolidated Statements of Changes in Shareholders’ Equity - Six Months Ended June 30, 2015 and 2014
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Consolidated Statements of Cash Flows - Six Months Ended June 30, 2015 and 2014
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Notes to Consolidated Financial Statements
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ITEM 2.
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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ITEM 3.
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QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
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ITEM 4.
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CONTROLS AND PROCEDURES
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PART II. OTHER INFORMATION
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ITEM 1.
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LEGAL PROCEEDINGS
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ITEM 1A.
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RISK FACTORS
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ITEM 2.
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UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
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ITEM 3.
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DEFAULTS UPON SENIOR SECURITIES
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ITEM 4.
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MINE SAFETY DISCLOSURES
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ITEM 5.
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OTHER INFORMATION
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ITEM 6.
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EXHIBITS
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SIGNATURES
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EXHIBITS
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CONSOLIDATED STATEMENTS OF CONDITION
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||||||||
(In Thousands, Except Number of Shares)
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June 30, 2015
(unaudited)
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December 31, 2014
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||||
ASSETS
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Cash and due from banks
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$
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55,495
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$
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60,813
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Securities:
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Available-for-sale securities, at fair value
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742,356
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763,063
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Held-to-maturity securities, at amortized cost
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60,234
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20,179
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Federal Home Loan Bank and Federal Reserve Bank stock, at cost
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20,401
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20,391
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Total securities
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822,991
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803,633
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Loans held for sale
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1,426
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—
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Loans
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1,807,007
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1,772,610
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Less: allowance for loan losses
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(21,194
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)
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(21,116
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)
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Net loans
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1,785,813
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1,751,494
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Bank-owned life insurance
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58,624
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57,800
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Goodwill and other intangible assets
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47,596
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48,171
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Premises and equipment, net
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23,615
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23,886
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Deferred tax assets
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13,682
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14,434
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Interest receivable
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6,752
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6,017
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Other real estate owned
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651
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1,587
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Other assets
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21,276
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22,018
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Total assets
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$
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2,837,921
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$
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2,789,853
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LIABILITIES AND SHAREHOLDERS’ EQUITY
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Liabilities
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Deposits:
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Demand
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$
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279,146
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$
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263,013
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Interest checking
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501,980
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480,521
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Savings and money market
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643,658
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653,708
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Certificates of deposit
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310,301
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317,123
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Brokered deposits
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246,046
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217,732
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Total deposits
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1,981,131
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1,932,097
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Federal Home Loan Bank advances
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56,001
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56,039
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Other borrowed funds
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464,021
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476,939
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Junior subordinated debentures
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44,075
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44,024
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Accrued interest and other liabilities
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38,153
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35,645
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Total liabilities
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2,583,381
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2,544,744
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Commitments and Contingencies
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Shareholders’ Equity
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Common stock, no par value; authorized 20,000,000 shares, issued and outstanding 7,449,645 and 7,426,222 shares as of June 30, 2015 and December 31, 2014, respectively
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41,919
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41,555
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Retained earnings
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220,309
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211,979
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Accumulated other comprehensive loss:
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Net unrealized losses on available-for-sale securities, net of tax
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(181
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)
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(319
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)
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Net unrealized losses on derivative instruments, net of tax
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(5,421
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)
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(5,943
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)
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Net unrecognized losses on postretirement plans, net of tax
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(2,086
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)
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(2,163
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)
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Total accumulated other comprehensive loss
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(7,688
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)
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(8,425
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)
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Total shareholders’ equity
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254,540
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245,109
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Total liabilities and shareholders’ equity
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$
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2,837,921
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$
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2,789,853
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CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
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Three Months Ended
June 30, |
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Six Months Ended
June 30, |
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(In Thousands, Except Number of Shares and Per Share Data)
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2015
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2014
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2015
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2014
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Interest Income
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Interest and fees on loans
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$
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19,342
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$
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17,757
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$
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37,426
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$
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34,537
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Interest on U.S. government and sponsored enterprise obligations
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3,717
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4,124
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7,589
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8,354
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Interest on state and political subdivision obligations
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493
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314
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880
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608
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Interest on federal funds sold and other investments
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105
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89
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210
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176
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||||
Total interest income
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23,657
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22,284
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46,105
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43,675
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Interest Expense
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Interest on deposits
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1,544
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1,565
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3,073
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3,116
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Interest on borrowings
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847
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845
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1,707
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1,652
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Interest on junior subordinated debentures
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631
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631
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1,256
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1,256
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||||
Total interest expense
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3,022
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3,041
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6,036
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6,024
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Net interest income
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20,635
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19,243
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40,069
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37,651
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Provision for credit losses
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254
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|
643
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|
700
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1,136
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Net interest income after provision for credit losses
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20,381
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18,600
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39,369
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36,515
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Non-Interest Income
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|
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||||
Service charges on deposit accounts
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1,593
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1,620
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3,080
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3,089
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||||
Other service charges and fees
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1,584
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1,543
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3,094
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2,938
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Income from fiduciary services
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1,328
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1,349
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2,548
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2,533
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Brokerage and insurance commissions
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502
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459
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951
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937
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Bank-owned life insurance
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402
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292
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824
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598
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Mortgage banking income, net
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346
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70
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|
|
585
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142
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||||
Net gain on sale of securities
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—
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|
|
285
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|
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—
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|
|
451
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|
||||
Other income
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|
555
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|
|
891
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|
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1,375
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|
|
1,508
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|
||||
Total non-interest income
|
|
6,310
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|
|
6,509
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|
|
12,457
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|
|
12,196
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|
||||
Non-Interest Expense
|
|
|
|
|
|
|
|
|
|
|
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|
||||
Salaries and employee benefits
|
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8,484
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|
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8,301
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|
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16,859
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|
|
16,281
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|
||||
Furniture, equipment and data processing
|
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1,902
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|
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1,743
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|
|
3,825
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|
|
3,532
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|
||||
Net occupancy
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1,239
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|
|
1,270
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|
|
2,711
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|
|
2,650
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|
||||
Consulting and professional fees
|
|
673
|
|
|
782
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|
|
1,264
|
|
|
1,300
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|
||||
Regulatory assessments
|
|
511
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|
|
485
|
|
|
1,021
|
|
|
966
|
|
||||
Other real estate owned and collection costs
|
|
449
|
|
|
515
|
|
|
1,011
|
|
|
1,028
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|
||||
Amortization of intangible assets
|
|
287
|
|
|
287
|
|
|
574
|
|
|
574
|
|
||||
Merger and acquisition costs
|
|
128
|
|
|
—
|
|
|
863
|
|
|
—
|
|
||||
Other expenses
|
|
2,484
|
|
|
2,409
|
|
|
4,830
|
|
|
4,586
|
|
||||
Total non-interest expense
|
|
16,157
|
|
|
15,792
|
|
|
32,958
|
|
|
30,917
|
|
||||
Income before income taxes
|
|
10,534
|
|
|
9,317
|
|
|
18,868
|
|
|
17,794
|
|
||||
Income Taxes
|
|
3,341
|
|
|
3,001
|
|
|
6,064
|
|
|
5,763
|
|
||||
Net Income
|
|
$
|
7,193
|
|
|
$
|
6,316
|
|
|
$
|
12,804
|
|
|
$
|
12,031
|
|
|
|
|
|
|
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||||||||
Per Share Data
|
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|
|
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|
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||||
Basic earnings per share
|
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$
|
0.97
|
|
|
$
|
0.85
|
|
|
$
|
1.72
|
|
|
$
|
1.60
|
|
Diluted earnings per share
|
|
$
|
0.96
|
|
|
$
|
0.85
|
|
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$
|
1.71
|
|
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$
|
1.60
|
|
Weighted average number of common shares outstanding
|
|
7,446,156
|
|
|
7,430,709
|
|
|
7,438,626
|
|
|
7,479,461
|
|
||||
Diluted weighted average number of common shares outstanding
|
|
7,467,365
|
|
|
7,450,639
|
|
|
7,459,464
|
|
|
7,500,318
|
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
|
||||||||||||||||
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
(In Thousands)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Net Income
|
|
$
|
7,193
|
|
|
$
|
6,316
|
|
|
$
|
12,804
|
|
|
$
|
12,031
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
||||||
Net unrealized gains (losses) on available-for-sale securities arising during the period, net of tax of $2,138, ($2,897), ($74) and ($3,938), respectively
|
|
(3,970
|
)
|
|
5,381
|
|
|
138
|
|
|
7,314
|
|
||||
Reclassification of gains included in net income, net of tax of $0, $100, $0 and $158, respectively
(1)
|
|
—
|
|
|
(185
|
)
|
|
—
|
|
|
(293
|
)
|
||||
Net change in unrealized gains (losses) on available-for-sale securities, net of tax
|
|
(3,970
|
)
|
|
5,196
|
|
|
138
|
|
|
7,021
|
|
||||
Net change in unrealized gains (losses) on cash flow hedging derivatives, net of tax of ($913), $437, ($282), and $1,020, respectively
|
|
1,694
|
|
|
(812
|
)
|
|
522
|
|
|
(1,895
|
)
|
||||
Reclassification of amortization of net unrecognized actuarial loss and prior service cost, net of tax of ($20), ($12), ($41) and ($27), respectively
(2)
|
|
39
|
|
|
20
|
|
|
77
|
|
|
47
|
|
||||
Other comprehensive income (loss)
|
|
(2,237
|
)
|
|
4,404
|
|
|
737
|
|
|
5,173
|
|
||||
Comprehensive Income
|
|
$
|
4,956
|
|
|
$
|
10,720
|
|
|
$
|
13,541
|
|
|
$
|
17,204
|
|
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(unaudited)
|
|||||||||||||||||||
|
|
Common Stock
|
|
|
|
Accumulated
Other Comprehensive
Loss
|
|
Total Shareholders’
Equity
|
|||||||||||
(In Thousands, Except Number of Shares and Per Share Data)
|
|
Shares
Outstanding
|
|
Amount
|
|
Retained
Earnings
|
|
|
|||||||||||
Balance at December 31, 2013
|
|
7,579,913
|
|
|
$
|
47,783
|
|
|
$
|
195,660
|
|
|
$
|
(12,347
|
)
|
|
$
|
231,096
|
|
Net income
|
|
—
|
|
|
—
|
|
|
12,031
|
|
|
—
|
|
|
12,031
|
|
||||
Other comprehensive income, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,173
|
|
|
5,173
|
|
||||
Stock-based compensation expense
|
|
—
|
|
|
431
|
|
|
—
|
|
|
—
|
|
|
431
|
|
||||
Exercise of stock options and issuance of vested share awards, net of repurchase for tax withholdings and tax benefit
|
|
22,887
|
|
|
152
|
|
|
—
|
|
|
—
|
|
|
152
|
|
||||
Common stock repurchased
|
|
(181,355
|
)
|
|
(7,155
|
)
|
|
—
|
|
|
—
|
|
|
(7,155
|
)
|
||||
Cash dividends declared ($0.54 per share)
|
|
—
|
|
|
—
|
|
|
(4,008
|
)
|
|
—
|
|
|
(4,008
|
)
|
||||
Balance at June 30, 2014
|
|
7,421,445
|
|
|
$
|
41,211
|
|
|
$
|
203,683
|
|
|
$
|
(7,174
|
)
|
|
$
|
237,720
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance at December 31, 2014
|
|
7,426,222
|
|
|
$
|
41,555
|
|
|
$
|
211,979
|
|
|
$
|
(8,425
|
)
|
|
$
|
245,109
|
|
Net income
|
|
—
|
|
|
—
|
|
|
12,804
|
|
|
—
|
|
|
12,804
|
|
||||
Other comprehensive income, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
737
|
|
|
737
|
|
||||
Stock-based compensation expense
|
|
—
|
|
|
410
|
|
|
—
|
|
|
—
|
|
|
410
|
|
||||
Exercise of stock options and issuance of vested share awards, net of repurchase for tax withholdings and tax benefit
|
|
23,423
|
|
|
375
|
|
|
—
|
|
|
—
|
|
|
375
|
|
||||
Equity issuance costs
|
|
—
|
|
|
(421
|
)
|
|
—
|
|
|
—
|
|
|
(421
|
)
|
||||
Cash dividends declared ($0.60 per share)
|
|
—
|
|
|
—
|
|
|
(4,474
|
)
|
|
—
|
|
|
(4,474
|
)
|
||||
Balance at June 30, 2015
|
|
7,449,645
|
|
|
$
|
41,919
|
|
|
$
|
220,309
|
|
|
$
|
(7,688
|
)
|
|
$
|
254,540
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
|
||||||||
|
|
Six Months Ended
June 30,
|
||||||
(In Thousands)
|
|
2015
|
|
2014
|
||||
Operating Activities
|
|
|
|
|
|
|
||
Net Income
|
|
$
|
12,804
|
|
|
$
|
12,031
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||
Provision for credit losses
|
|
700
|
|
|
1,136
|
|
||
Depreciation expense
|
|
1,446
|
|
|
1,459
|
|
||
Investment securities amortization and accretion, net
|
|
1,049
|
|
|
831
|
|
||
Stock-based compensation expense
|
|
410
|
|
|
431
|
|
||
Amortization of intangible assets
|
|
574
|
|
|
574
|
|
||
Net gain on sale of investment securities
|
|
—
|
|
|
(451
|
)
|
||
Net increase in other real estate owned valuation allowance and loss on disposition
|
|
216
|
|
|
43
|
|
||
Originations of mortgage loans held for sale
|
|
(13,949
|
)
|
|
(399
|
)
|
||
Proceeds from the sale of mortgage loans
|
|
12,833
|
|
|
416
|
|
||
Gain on sale of mortgage loans
|
|
(292
|
)
|
|
(17
|
)
|
||
Increase in other assets
|
|
(992
|
)
|
|
(1,758
|
)
|
||
(Decrease) increase in other liabilities
|
|
(143
|
)
|
|
271
|
|
||
Net cash provided by operating activities
|
|
14,656
|
|
|
14,567
|
|
||
Investing Activities
|
|
|
|
|
|
|
||
Proceeds from sales and maturities of available-for-sale securities
|
|
76,042
|
|
|
75,517
|
|
||
Purchase of available-for-sale securities
|
|
(56,005
|
)
|
|
(29,036
|
)
|
||
Purchase of held-to-maturity securities
|
|
(36,334
|
)
|
|
(9,847
|
)
|
||
Net increase in loans
|
|
(36,747
|
)
|
|
(118,348
|
)
|
||
Purchase of Federal Home Loan Bank stock
|
|
(10
|
)
|
|
(706
|
)
|
||
Proceeds from sale of Federal Home Loan Bank and Federal Reserve Bank stock
|
|
—
|
|
|
51
|
|
||
Proceeds from the sale of other real estate owned
|
|
2,268
|
|
|
890
|
|
||
Recoveries of previously charged-off loans
|
|
285
|
|
|
383
|
|
||
Purchase of premises and equipment
|
|
(1,117
|
)
|
|
(494
|
)
|
||
Net cash used by investing activities
|
|
(51,618
|
)
|
|
(81,590
|
)
|
||
Financing Activities
|
|
|
|
|
|
|||
Net increase in deposits
|
|
49,085
|
|
|
43,725
|
|
||
Proceeds from Federal Home Loan Bank long-term advances
|
|
10,000
|
|
|
—
|
|
||
Repayments on Federal Home Loan Bank long-term advances
|
|
(10,038
|
)
|
|
(36
|
)
|
||
Net (decrease) increase in other borrowed funds
|
|
(12,883
|
)
|
|
34,832
|
|
||
Registration statement costs
|
|
(421
|
)
|
|
—
|
|
||
Common stock repurchased
|
|
—
|
|
|
(7,475
|
)
|
||
Exercise of stock options and issuance of restricted stock, net of repurchase for tax withholdings and tax benefit
|
|
375
|
|
|
152
|
|
||
Cash dividends paid on common stock
|
|
(4,474
|
)
|
|
(4,065
|
)
|
||
Net cash provided by financing activities
|
|
31,644
|
|
|
67,133
|
|
||
Net (decrease) increase in cash and cash equivalents
|
|
(5,318
|
)
|
|
110
|
|
||
Cash and cash equivalents at beginning of period
|
|
60,813
|
|
|
51,355
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
55,495
|
|
|
$
|
51,465
|
|
Supplemental information
|
|
|
|
|
|
|
||
Interest paid
|
|
$
|
3,040
|
|
|
$
|
6,075
|
|
Income taxes paid
|
|
4,350
|
|
|
3,720
|
|
||
Transfer from loans to other real estate owned
|
|
1,548
|
|
|
955
|
|
||
Held-to-maturity securities purchased but unsettled
|
|
3,888
|
|
|
—
|
|
Acadia Trust:
|
Acadia Trust, N.A., a wholly-owned subsidiary of Camden National Corporation
|
|
FASB:
|
Financial Accounting Standards Board
|
Act:
|
Medicare Prescription Drug, Improvement and Modernization Act
|
|
FDIC:
|
Federal Deposit Insurance Corporation
|
AFS:
|
Available-for-sale
|
|
FHLB:
|
Federal Home Loan Bank
|
ALCO:
|
Asset/Liability Committee
|
|
FHLBB:
|
Federal Home Loan Bank of Boston
|
ALL:
|
Allowance for loan losses
|
|
FRB:
|
Federal Reserve Bank
|
AOCI:
|
Accumulated other comprehensive income (loss)
|
|
Freddie Mac:
|
Federal Home Loan Mortgage Corporation
|
ASC:
|
Accounting Standards Codification
|
|
GAAP:
|
Generally accepted accounting principles in the United States
|
ASU:
|
Accounting Standards Update
|
|
HTM:
|
Held-to-maturity
|
Bank:
|
Camden National Bank, a wholly-owned subsidiary of Camden National Corporation
|
|
IRS:
|
Internal Revenue Service
|
BOLI:
|
Bank-owned life insurance
|
|
LIBOR:
|
London Interbank Offered Rate
|
Board ALCO:
|
Board of Directors' Asset/Liability Committee
|
|
LTIP:
|
Long-Term Performance Share Plan
|
BSA:
|
Bank Secrecy Act
|
|
MaineHousing:
|
Maine State Housing Authority
|
CCTA:
|
Camden Capital Trust A, an unconsolidated entity formed by Camden National Corporation
|
|
Management ALCO:
|
Management Asset/Liability Committee
|
CDARS:
|
Certificate of Deposit Account Registry System
|
|
MBS:
|
Mortgage-backed security
|
CDs:
|
Certificate of deposits
|
|
MSRs:
|
Mortgage servicing rights
|
Company:
|
Camden National Corporation
|
|
MSPP:
|
Management Stock Purchase Plan
|
CSV:
|
Cash surrender value
|
|
OTTI:
|
Other-than-temporary impairment
|
CMO:
|
Collateralized mortgage obligation
|
|
NIM:
|
Net interest margin on a fully-taxable basis
|
DCRP:
|
Defined Contribution Retirement Plan
|
|
N.M.:
|
Not meaningful
|
EPS:
|
Earnings per share
|
|
Non-Agency:
|
Non-agency private issue collateralized mortgage obligation
|
NRV:
|
Net realizable value
|
|
TBM:
|
The Bank of Maine
|
OCC:
|
Office of the Comptroller of the Currency
|
|
TDR:
|
Troubled-debt restructured loan
|
OCI:
|
Other comprehensive income (loss)
|
|
UBCT:
|
Union Bankshares Capital Trust I, an unconsolidated entity formed by Union Bankshares Company that was subsequently acquired by Camden National Corporation
|
OFAC:
|
Office of Foreign Assets Control
|
|
U.S.:
|
United States of America
|
OREO:
|
Other real estate owned
|
|
2003 Plan:
|
2003 Stock Option and Incentive Plan
|
SBM:
|
SMB Financial, Inc., the parent company of The Bank of Maine
|
|
2012 Plan:
|
2012 Equity and Incentive Plan
|
SERP:
|
Supplemental executive retirement plans
|
|
2013 Repurchase Program:
|
2013 Common Stock Repurchase Program, approved by the Company's Board of Directors
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Net income
|
|
$
|
7,193
|
|
|
$
|
6,316
|
|
|
$
|
12,804
|
|
|
$
|
12,031
|
|
Dividends and undistributed earnings allocated to participating securities
(1)
|
|
(23
|
)
|
|
(19
|
)
|
|
(40
|
)
|
|
(37
|
)
|
||||
Net income available to common shareholders
|
|
$
|
7,170
|
|
|
$
|
6,297
|
|
|
$
|
12,764
|
|
|
$
|
11,994
|
|
Weighted-average common shares outstanding for basic EPS
|
|
7,446,156
|
|
|
7,430,709
|
|
|
7,438,626
|
|
|
7,479,461
|
|
||||
Dilutive effect of stock-based awards
(2)
|
|
21,209
|
|
|
19,930
|
|
|
20,838
|
|
|
20,857
|
|
||||
Weighted-average common and potential common shares for diluted EPS
|
|
7,467,365
|
|
|
7,450,639
|
|
|
7,459,464
|
|
|
7,500,318
|
|
||||
Earnings per common share:
|
|
|
|
|
|
|
|
|
|
|
||||||
Basic EPS
|
|
$
|
0.97
|
|
|
$
|
0.85
|
|
|
$
|
1.72
|
|
|
$
|
1.60
|
|
Diluted EPS
|
|
$
|
0.96
|
|
|
$
|
0.85
|
|
|
$
|
1.71
|
|
|
$
|
1.60
|
|
Awards excluded from the calculation of diluted EPS
(3)
:
|
|
|
|
|
|
|
|
|
||||||||
Stock options
|
|
15,250
|
|
|
14,750
|
|
|
15,250
|
|
|
14,750
|
|
|
Amortized
Cost
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Fair
Value
|
||||||||
June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
||||
AFS Securities:
|
|
|
|
|
|
|
|
||||||||
Obligations of U.S. government-sponsored enterprises
|
$
|
4,967
|
|
|
$
|
84
|
|
|
$
|
—
|
|
|
$
|
5,051
|
|
Obligations of states and political subdivisions
|
21,192
|
|
|
481
|
|
|
—
|
|
|
21,673
|
|
||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
381,403
|
|
|
5,083
|
|
|
(3,219
|
)
|
|
383,267
|
|
||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
329,577
|
|
|
1,483
|
|
|
(4,187
|
)
|
|
326,873
|
|
||||
Private issue collateralized mortgage obligations
|
5,495
|
|
|
73
|
|
|
(76
|
)
|
|
5,492
|
|
||||
Total AFS securities
|
$
|
742,634
|
|
|
$
|
7,204
|
|
|
$
|
(7,482
|
)
|
|
$
|
742,356
|
|
HTM Securities:
|
|
|
|
|
|
|
|
||||||||
Obligations of states and political subdivisions
|
$
|
60,234
|
|
|
$
|
277
|
|
|
$
|
(702
|
)
|
|
$
|
59,809
|
|
Total HTM securities
|
$
|
60,234
|
|
|
$
|
277
|
|
|
$
|
(702
|
)
|
|
$
|
59,809
|
|
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
||||
AFS Securities:
|
|
|
|
|
|
|
|
||||||||
Obligations of U.S. government-sponsored enterprises
|
$
|
4,962
|
|
|
$
|
65
|
|
|
$
|
—
|
|
|
$
|
5,027
|
|
Obligations of states and political subdivisions
|
26,080
|
|
|
697
|
|
|
—
|
|
|
26,777
|
|
||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
377,657
|
|
|
5,656
|
|
|
(2,005
|
)
|
|
381,308
|
|
||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
348,855
|
|
|
953
|
|
|
(5,911
|
)
|
|
343,897
|
|
||||
Private issue collateralized mortgage obligations
|
5,999
|
|
|
63
|
|
|
(8
|
)
|
|
6,054
|
|
||||
Total AFS securities
|
$
|
763,553
|
|
|
$
|
7,434
|
|
|
$
|
(7,924
|
)
|
|
$
|
763,063
|
|
HTM Securities:
|
|
|
|
|
|
|
|
||||||||
Obligations of states and political subdivisions
|
$
|
20,179
|
|
|
$
|
265
|
|
|
$
|
(19
|
)
|
|
$
|
20,425
|
|
Total HTM securities
|
$
|
20,179
|
|
|
$
|
265
|
|
|
$
|
(19
|
)
|
|
$
|
20,425
|
|
|
Less Than 12 Months
|
|
12 Months or More
|
|
Total
|
||||||||||||||||||
|
Fair
Value
|
|
Unrealized
Losses
|
|
Fair
Value
|
|
Unrealized
Losses
|
|
Fair
Value
|
|
Unrealized
Losses
|
||||||||||||
June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
AFS Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
$
|
120,190
|
|
|
$
|
(1,360
|
)
|
|
$
|
58,881
|
|
|
$
|
(1,859
|
)
|
|
$
|
179,071
|
|
|
$
|
(3,219
|
)
|
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
34,272
|
|
|
(312
|
)
|
|
154,439
|
|
|
(3,875
|
)
|
|
188,711
|
|
|
(4,187
|
)
|
||||||
Private issue collateralized mortgage obligations
|
1,704
|
|
|
(76
|
)
|
|
—
|
|
|
—
|
|
|
1,704
|
|
|
(76
|
)
|
||||||
Total AFS securities
|
$
|
156,166
|
|
|
$
|
(1,748
|
)
|
|
$
|
213,320
|
|
|
$
|
(5,734
|
)
|
|
$
|
369,486
|
|
|
$
|
(7,482
|
)
|
HTM Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Obligations of states and political subdivisions
|
$
|
40,243
|
|
|
$
|
(702
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
40,243
|
|
|
$
|
(702
|
)
|
Total HTM securities
|
$
|
40,243
|
|
|
$
|
(702
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
40,243
|
|
|
$
|
(702
|
)
|
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
AFS Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
$
|
42,856
|
|
|
$
|
(171
|
)
|
|
$
|
125,439
|
|
|
$
|
(1,834
|
)
|
|
$
|
168,295
|
|
|
$
|
(2,005
|
)
|
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
75,723
|
|
|
(432
|
)
|
|
182,512
|
|
|
(5,479
|
)
|
|
258,235
|
|
|
(5,911
|
)
|
||||||
Private issue collateralized mortgage obligations
|
1,785
|
|
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
1,785
|
|
|
(8
|
)
|
||||||
Total AFS securities
|
$
|
120,364
|
|
|
$
|
(611
|
)
|
|
$
|
307,951
|
|
|
$
|
(7,313
|
)
|
|
$
|
428,315
|
|
|
$
|
(7,924
|
)
|
HTM Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Obligations of states and political subdivisions
|
$
|
5,756
|
|
|
$
|
(19
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,756
|
|
|
$
|
(19
|
)
|
Total HTM securities
|
$
|
5,756
|
|
|
$
|
(19
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,756
|
|
|
$
|
(19
|
)
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Proceeds from sales of securities
|
$
|
—
|
|
|
$
|
16,258
|
|
|
$
|
—
|
|
|
$
|
25,695
|
|
Gross realized gains
|
—
|
|
|
285
|
|
|
—
|
|
|
451
|
|
||||
Gross realized losses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Amortized
Cost
|
|
Fair
Value
|
||||
AFS Securities
|
|
|
|
||||
Due in one year or less
|
$
|
3,131
|
|
|
$
|
3,188
|
|
Due after one year through five years
|
89,497
|
|
|
89,995
|
|
||
Due after five years through ten years
|
103,955
|
|
|
105,684
|
|
||
Due after ten years
|
546,051
|
|
|
543,489
|
|
||
|
$
|
742,634
|
|
|
$
|
742,356
|
|
HTM Securities
|
|
|
|
||||
Due in one year or less
|
$
|
—
|
|
|
$
|
—
|
|
Due after one year through five years
|
2,250
|
|
|
2,284
|
|
||
Due after five years through ten years
|
1,143
|
|
|
1,146
|
|
||
Due after ten years
|
56,841
|
|
|
56,379
|
|
||
|
$
|
60,234
|
|
|
$
|
59,809
|
|
|
June 30,
2015 |
|
December 31,
2014 |
||||
Residential real estate
|
$
|
587,720
|
|
|
$
|
585,996
|
|
Commercial real estate
|
660,135
|
|
|
640,661
|
|
||
Commercial
|
262,187
|
|
|
257,515
|
|
||
Home equity
|
281,057
|
|
|
271,709
|
|
||
Consumer
|
16,384
|
|
|
17,257
|
|
||
Net deferred fees
|
(476
|
)
|
|
(528
|
)
|
||
Total
|
$
|
1,807,007
|
|
|
$
|
1,772,610
|
|
|
Residential
Real Estate
|
|
Commercial
Real Estate
|
|
Commercial
|
|
Home
Equity
|
|
Consumer
|
|
Unallocated
|
|
Total
|
||||||||||||||
For The Three and Six Months Ended
June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
ALL for the three months ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Beginning balance
|
$
|
4,835
|
|
|
$
|
4,761
|
|
|
$
|
6,900
|
|
|
$
|
2,247
|
|
|
$
|
270
|
|
|
$
|
2,252
|
|
|
$
|
21,265
|
|
Loans charged off
|
(179
|
)
|
|
(48
|
)
|
|
(84
|
)
|
|
(152
|
)
|
|
(11
|
)
|
|
—
|
|
|
(474
|
)
|
|||||||
Recoveries
|
17
|
|
|
54
|
|
|
78
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
152
|
|
|||||||
Provision (benefit)
(1)
|
16
|
|
|
(69
|
)
|
|
(117
|
)
|
|
49
|
|
|
6
|
|
|
366
|
|
|
251
|
|
|||||||
Ending balance
|
$
|
4,689
|
|
|
$
|
4,698
|
|
|
$
|
6,777
|
|
|
$
|
2,144
|
|
|
$
|
268
|
|
|
$
|
2,618
|
|
|
$
|
21,194
|
|
ALL for the six months ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Beginning balance
|
$
|
4,899
|
|
|
$
|
4,482
|
|
|
$
|
6,823
|
|
|
$
|
2,247
|
|
|
$
|
281
|
|
|
$
|
2,384
|
|
|
$
|
21,116
|
|
Loans charged off
|
(292
|
)
|
|
(103
|
)
|
|
(243
|
)
|
|
(241
|
)
|
|
(19
|
)
|
|
—
|
|
|
(898
|
)
|
|||||||
Recoveries
|
20
|
|
|
64
|
|
|
182
|
|
|
5
|
|
|
14
|
|
|
—
|
|
|
285
|
|
|||||||
Provision (benefit)
(1)
|
62
|
|
|
255
|
|
|
15
|
|
|
133
|
|
|
(8
|
)
|
|
234
|
|
|
691
|
|
|||||||
Ending balance
|
$
|
4,689
|
|
|
$
|
4,698
|
|
|
$
|
6,777
|
|
|
$
|
2,144
|
|
|
$
|
268
|
|
|
$
|
2,618
|
|
|
$
|
21,194
|
|
ALL balance attributable to loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Individually evaluated for impairment
|
$
|
1,044
|
|
|
$
|
336
|
|
|
$
|
262
|
|
|
$
|
343
|
|
|
$
|
99
|
|
|
$
|
—
|
|
|
$
|
2,084
|
|
Collectively evaluated for impairment
|
3,645
|
|
|
4,362
|
|
|
6,515
|
|
|
1,801
|
|
|
169
|
|
|
2,618
|
|
|
19,110
|
|
|||||||
Total ending ALL
|
$
|
4,689
|
|
|
$
|
4,698
|
|
|
$
|
6,777
|
|
|
$
|
2,144
|
|
|
$
|
268
|
|
|
$
|
2,618
|
|
|
$
|
21,194
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Individually evaluated for impairment
|
$
|
7,937
|
|
|
$
|
4,344
|
|
|
$
|
1,768
|
|
|
$
|
1,706
|
|
|
$
|
251
|
|
|
$
|
—
|
|
|
$
|
16,006
|
|
Collectively evaluated for impairment
|
579,307
|
|
|
655,791
|
|
|
260,419
|
|
|
279,351
|
|
|
16,133
|
|
|
—
|
|
|
1,791,001
|
|
|||||||
Total ending loans balance
|
$
|
587,244
|
|
|
$
|
660,135
|
|
|
$
|
262,187
|
|
|
$
|
281,057
|
|
|
$
|
16,384
|
|
|
$
|
—
|
|
|
$
|
1,807,007
|
|
|
Residential
Real Estate
|
|
Commercial
Real Estate
|
|
Commercial
|
|
Home
Equity
|
|
Consumer
|
|
Unallocated
|
|
Total
|
||||||||||||||
For The Three and Six Months Ended
June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
ALL for the three months ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Beginning balance
|
$
|
5,411
|
|
|
$
|
4,528
|
|
|
$
|
6,292
|
|
|
$
|
2,673
|
|
|
$
|
310
|
|
|
$
|
2,456
|
|
|
$
|
21,670
|
|
Loans charged off
|
(178
|
)
|
|
(5
|
)
|
|
(307
|
)
|
|
(44
|
)
|
|
(26
|
)
|
|
—
|
|
|
(560
|
)
|
|||||||
Recoveries
|
42
|
|
|
11
|
|
|
73
|
|
|
8
|
|
|
12
|
|
|
—
|
|
|
146
|
|
|||||||
Provision (benefit)
(1)
|
(134
|
)
|
|
(173
|
)
|
|
426
|
|
|
115
|
|
|
22
|
|
|
393
|
|
|
649
|
|
|||||||
Ending balance
|
$
|
5,141
|
|
|
$
|
4,361
|
|
|
$
|
6,484
|
|
|
$
|
2,752
|
|
|
$
|
318
|
|
|
$
|
2,849
|
|
|
$
|
21,905
|
|
ALL for the six months ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Beginning balance
|
$
|
5,603
|
|
|
$
|
4,374
|
|
|
$
|
6,220
|
|
|
$
|
2,403
|
|
|
$
|
319
|
|
|
$
|
2,671
|
|
|
$
|
21,590
|
|
Loans charged off
|
(361
|
)
|
|
(176
|
)
|
|
(526
|
)
|
|
(106
|
)
|
|
(40
|
)
|
|
—
|
|
|
(1,209
|
)
|
|||||||
Recoveries
|
134
|
|
|
50
|
|
|
169
|
|
|
11
|
|
|
19
|
|
|
—
|
|
|
383
|
|
|||||||
Provision (benefit)
(1)
|
(235
|
)
|
|
113
|
|
|
621
|
|
|
444
|
|
|
20
|
|
|
178
|
|
|
1,141
|
|
|||||||
Ending balance
|
$
|
5,141
|
|
|
$
|
4,361
|
|
|
$
|
6,484
|
|
|
$
|
2,752
|
|
|
$
|
318
|
|
|
$
|
2,849
|
|
|
$
|
21,905
|
|
ALL balance attributable to loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Individually evaluated for impairment
|
$
|
1,346
|
|
|
$
|
397
|
|
|
$
|
578
|
|
|
$
|
805
|
|
|
$
|
138
|
|
|
$
|
—
|
|
|
$
|
3,264
|
|
Collectively evaluated for impairment
|
3,795
|
|
|
3,964
|
|
|
5,906
|
|
|
1,947
|
|
|
180
|
|
|
2,849
|
|
|
18,641
|
|
|||||||
Total ending ALL
|
$
|
5,141
|
|
|
$
|
4,361
|
|
|
$
|
6,484
|
|
|
$
|
2,752
|
|
|
$
|
318
|
|
|
$
|
2,849
|
|
|
$
|
21,905
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Individually evaluated for impairment
|
$
|
11,782
|
|
|
$
|
7,334
|
|
|
$
|
4,272
|
|
|
$
|
2,142
|
|
|
$
|
433
|
|
|
$
|
—
|
|
|
$
|
25,963
|
|
Collectively evaluated for impairment
|
555,377
|
|
|
596,806
|
|
|
229,587
|
|
|
271,637
|
|
|
17,395
|
|
|
—
|
|
|
1,670,802
|
|
|||||||
Total ending loans balance
|
$
|
567,159
|
|
|
$
|
604,140
|
|
|
$
|
233,859
|
|
|
$
|
273,779
|
|
|
$
|
17,828
|
|
|
$
|
—
|
|
|
$
|
1,696,765
|
|
For The Year Ended
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
ALL:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Beginning balance
|
$
|
5,603
|
|
|
$
|
4,374
|
|
|
$
|
6,220
|
|
|
$
|
2,403
|
|
|
$
|
319
|
|
|
$
|
2,671
|
|
|
$
|
21,590
|
|
Loans charged off
|
(785
|
)
|
|
(361
|
)
|
|
(1,544
|
)
|
|
(611
|
)
|
|
(143
|
)
|
|
—
|
|
|
(3,444
|
)
|
|||||||
Recoveries
|
165
|
|
|
135
|
|
|
395
|
|
|
19
|
|
|
32
|
|
|
—
|
|
|
746
|
|
|||||||
Provision (benefit)
(1)
|
(84
|
)
|
|
334
|
|
|
1,752
|
|
|
436
|
|
|
73
|
|
|
(287
|
)
|
|
2,224
|
|
|||||||
Ending balance
|
$
|
4,899
|
|
|
$
|
4,482
|
|
|
$
|
6,823
|
|
|
$
|
2,247
|
|
|
$
|
281
|
|
|
$
|
2,384
|
|
|
$
|
21,116
|
|
ALL balance attributable to loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Individually evaluated for impairment
|
$
|
1,220
|
|
|
$
|
251
|
|
|
$
|
168
|
|
|
$
|
496
|
|
|
$
|
104
|
|
|
$
|
—
|
|
|
$
|
2,239
|
|
Collectively evaluated for impairment
|
3,679
|
|
|
4,231
|
|
|
6,655
|
|
|
1,751
|
|
|
177
|
|
|
2,384
|
|
|
18,877
|
|
|||||||
Total ending ALL
|
$
|
4,899
|
|
|
$
|
4,482
|
|
|
$
|
6,823
|
|
|
$
|
2,247
|
|
|
$
|
281
|
|
|
$
|
2,384
|
|
|
$
|
21,116
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Individually evaluated for impairment
|
$
|
9,656
|
|
|
$
|
7,658
|
|
|
$
|
1,853
|
|
|
$
|
1,741
|
|
|
$
|
271
|
|
|
$
|
—
|
|
|
$
|
21,179
|
|
Collectively evaluated for impairment
|
575,812
|
|
|
633,003
|
|
|
255,662
|
|
|
269,968
|
|
|
16,986
|
|
|
—
|
|
|
1,751,431
|
|
|||||||
Total ending loans balance
|
$
|
585,468
|
|
|
$
|
640,661
|
|
|
$
|
257,515
|
|
|
$
|
271,709
|
|
|
$
|
17,257
|
|
|
$
|
—
|
|
|
$
|
1,772,610
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30, |
|
Year Ended December 31,
|
||||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2014
|
||||||||||
Provision for loan losses
|
|
$
|
251
|
|
|
$
|
649
|
|
|
$
|
691
|
|
|
$
|
1,141
|
|
|
$
|
2,224
|
|
Change in reserve for unfunded commitments
|
|
3
|
|
|
(6
|
)
|
|
9
|
|
|
(5
|
)
|
|
(4
|
)
|
|||||
Provision for credit losses
|
|
$
|
254
|
|
|
$
|
643
|
|
|
$
|
700
|
|
|
$
|
1,136
|
|
|
$
|
2,220
|
|
•
|
Grade 1 through 6 — Grades 1 through 6 represent groups of loans that are not subject to adverse criticism as defined in regulatory guidance. Loans in these groups exhibit characteristics that represent low to moderate risks, which is measured using a variety of credit risk criteria, such as cash flow coverage, debt service coverage, balance sheet leverage, liquidity, management experience, industry position, prevailing economic conditions, support from secondary sources of repayment and other credit factors that may be relevant to a specific loan. In general, these loans are supported by properly margined collateral and guarantees of principal parties.
|
•
|
Grade 7 — Loans with potential weakness (Special Mention). Loans in this category are currently protected based on collateral and repayment capacity and do not constitute undesirable credit risk, but have potential weakness that may result in deterioration of the repayment process at some future date. This classification is used if a negative trend is evident in the obligor’s financial situation. Special mention loans do not sufficiently expose the Company to warrant adverse classification.
|
•
|
Grade 8 — Loans with definite weakness (Substandard). Loans classified as substandard are inadequately protected by the current sound worth and paying capacity of the obligor or by collateral pledged. Borrowers experience difficulty in meeting debt repayment requirements. Deterioration is sufficient to cause the Company to look to the sale of collateral.
|
•
|
Grade 9 — Loans with potential loss (Doubtful). Loans classified as doubtful have all the weaknesses inherent in the substandard grade with the added characteristic that the weaknesses make collection or liquidation of the loan in full highly questionable and improbable. The possibility of some loss is extremely high, but because of specific pending factors that may work to the advantage and strengthening of the asset, its classification as an estimated loss is deferred until its more exact status may be determined.
|
•
|
Grade 10 — Loans with definite loss (Loss). Loans classified as loss are considered uncollectible. The loss classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off the asset because recovery and collection time may be protracted.
|
|
|
Residential
Real Estate
|
|
Commercial
Real Estate
|
|
Commercial
|
|
Home
Equity
|
|
Consumer
|
|
Total
|
||||||||||||
June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Pass (Grades 1-6)
|
|
$
|
576,814
|
|
|
$
|
617,517
|
|
|
$
|
249,918
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,444,249
|
|
Performing
|
|
—
|
|
|
—
|
|
|
—
|
|
|
279,351
|
|
|
16,133
|
|
|
295,484
|
|
||||||
Special Mention (Grade 7)
|
|
2,618
|
|
|
20,807
|
|
|
7,231
|
|
|
—
|
|
|
—
|
|
|
30,656
|
|
||||||
Substandard (Grade 8)
|
|
7,812
|
|
|
21,811
|
|
|
5,038
|
|
|
—
|
|
|
—
|
|
|
34,661
|
|
||||||
Non-performing
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,706
|
|
|
251
|
|
|
1,957
|
|
||||||
Total
|
|
$
|
587,244
|
|
|
$
|
660,135
|
|
|
$
|
262,187
|
|
|
$
|
281,057
|
|
|
$
|
16,384
|
|
|
$
|
1,807,007
|
|
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Pass (Grades 1-6)
|
|
$
|
572,589
|
|
|
$
|
606,387
|
|
|
$
|
244,930
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,423,906
|
|
Performing
|
|
—
|
|
|
—
|
|
|
—
|
|
|
269,968
|
|
|
16,986
|
|
|
286,954
|
|
||||||
Special Mention (Grade 7)
|
|
3,579
|
|
|
4,690
|
|
|
6,023
|
|
|
—
|
|
|
—
|
|
|
14,292
|
|
||||||
Substandard (Grade 8)
|
|
9,300
|
|
|
29,584
|
|
|
6,562
|
|
|
—
|
|
|
—
|
|
|
45,446
|
|
||||||
Non-performing
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,741
|
|
|
271
|
|
|
2,012
|
|
||||||
Total
|
|
$
|
585,468
|
|
|
$
|
640,661
|
|
|
$
|
257,515
|
|
|
$
|
271,709
|
|
|
$
|
17,257
|
|
|
$
|
1,772,610
|
|
|
30-59 Days
Past Due
|
|
60-89 Days
Past Due
|
|
Greater
than
90 Days
|
|
Total
Past Due
|
|
Current
|
|
Total Loans
Outstanding
|
|
Loans > 90
Days Past
Due and
Accruing
|
|
Non-Accrual
Loans
|
||||||||||||||||
June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Residential real estate
|
$
|
1,192
|
|
|
$
|
107
|
|
|
$
|
3,506
|
|
|
$
|
4,805
|
|
|
$
|
582,439
|
|
|
$
|
587,244
|
|
|
$
|
—
|
|
|
$
|
4,498
|
|
Commercial real estate
|
518
|
|
|
281
|
|
|
2,114
|
|
|
2,913
|
|
|
657,222
|
|
|
660,135
|
|
|
—
|
|
|
2,813
|
|
||||||||
Commercial
|
607
|
|
|
261
|
|
|
1,178
|
|
|
2,046
|
|
|
260,141
|
|
|
262,187
|
|
|
—
|
|
|
1,425
|
|
||||||||
Home equity
|
842
|
|
|
313
|
|
|
1,136
|
|
|
2,291
|
|
|
278,766
|
|
|
281,057
|
|
|
—
|
|
|
1,706
|
|
||||||||
Consumer
|
44
|
|
|
—
|
|
|
251
|
|
|
295
|
|
|
16,089
|
|
|
16,384
|
|
|
—
|
|
|
251
|
|
||||||||
Total
|
$
|
3,203
|
|
|
$
|
962
|
|
|
$
|
8,185
|
|
|
$
|
12,350
|
|
|
$
|
1,794,657
|
|
|
$
|
1,807,007
|
|
|
$
|
—
|
|
|
$
|
10,693
|
|
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Residential real estate
|
$
|
1,206
|
|
|
$
|
426
|
|
|
$
|
4,531
|
|
|
$
|
6,163
|
|
|
$
|
579,305
|
|
|
$
|
585,468
|
|
|
$
|
—
|
|
|
$
|
6,056
|
|
Commercial real estate
|
1,696
|
|
|
—
|
|
|
3,791
|
|
|
5,487
|
|
|
635,174
|
|
|
640,661
|
|
|
—
|
|
|
7,043
|
|
||||||||
Commercial
|
456
|
|
|
269
|
|
|
1,139
|
|
|
1,864
|
|
|
255,651
|
|
|
257,515
|
|
|
—
|
|
|
1,529
|
|
||||||||
Home equity
|
889
|
|
|
88
|
|
|
1,129
|
|
|
2,106
|
|
|
269,603
|
|
|
271,709
|
|
|
—
|
|
|
1,741
|
|
||||||||
Consumer
|
28
|
|
|
—
|
|
|
254
|
|
|
282
|
|
|
16,975
|
|
|
17,257
|
|
|
—
|
|
|
271
|
|
||||||||
Total
|
$
|
4,275
|
|
|
$
|
783
|
|
|
$
|
10,844
|
|
|
$
|
15,902
|
|
|
$
|
1,756,708
|
|
|
$
|
1,772,610
|
|
|
$
|
—
|
|
|
$
|
16,640
|
|
|
|
Number of Contracts
|
|
Recorded Investment
|
|
Specific Reserve
|
||||||||||||||||
|
|
June 30,
2015
|
|
December 31, 2014
|
|
June 30,
2015 |
|
December 31, 2014
|
|
June 30,
2015 |
|
December 31, 2014
|
||||||||||
Residential real estate
|
|
22
|
|
|
24
|
|
|
$
|
3,551
|
|
|
$
|
3,786
|
|
|
$
|
592
|
|
|
$
|
635
|
|
Commercial real estate
|
|
7
|
|
|
7
|
|
|
1,785
|
|
|
1,702
|
|
|
7
|
|
|
—
|
|
||||
Commercial
|
|
9
|
|
|
9
|
|
|
421
|
|
|
426
|
|
|
10
|
|
|
10
|
|
||||
Consumer and home equity
|
|
1
|
|
|
1
|
|
|
27
|
|
|
29
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
39
|
|
|
41
|
|
|
$
|
5,784
|
|
|
$
|
5,943
|
|
|
$
|
609
|
|
|
$
|
645
|
|
|
|
Number of Contracts
|
|
Pre-Modification
Outstanding
Recorded Investment
|
|
Post-Modification
Outstanding
Recorded Investment
|
|
Specific Reserve
|
||||||||||||||||||||||
|
|
June 30,
2015 |
|
June 30,
2014 |
|
June 30,
2015 |
|
June 30,
2014 |
|
June 30,
2015 |
|
June 30,
2014 |
|
June 30,
2015 |
|
June 30,
2014 |
||||||||||||||
For the six months ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Residential real estate
|
|
—
|
|
|
1
|
|
|
$
|
—
|
|
|
$
|
136
|
|
|
$
|
—
|
|
|
$
|
149
|
|
|
$
|
—
|
|
|
$
|
45
|
|
Total
|
|
—
|
|
|
1
|
|
|
$
|
—
|
|
|
$
|
136
|
|
|
$
|
—
|
|
|
$
|
149
|
|
|
$
|
—
|
|
|
$
|
45
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||||
|
Recorded
Investment
|
|
Unpaid
Principal
Balance
|
|
Related
Allowance
|
|
Average
Recorded
Investment
|
|
Interest
Income
Recognized
(1)
|
|
Average
Recorded Investment |
|
Interest
Income Recognized |
||||||||||||||
June 30, 2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Residential real estate
|
$
|
6,486
|
|
|
$
|
6,486
|
|
|
$
|
1,044
|
|
|
$
|
7,618
|
|
|
$
|
27
|
|
|
$
|
7,262
|
|
|
$
|
56
|
|
Commercial real estate
|
1,778
|
|
|
1,811
|
|
|
336
|
|
|
2,161
|
|
|
—
|
|
|
2,080
|
|
|
—
|
|
|||||||
Commercial
|
1,185
|
|
|
1,185
|
|
|
262
|
|
|
1,320
|
|
|
1
|
|
|
1,272
|
|
|
1
|
|
|||||||
Home equity
|
1,023
|
|
|
1,023
|
|
|
343
|
|
|
1,410
|
|
|
—
|
|
|
1,198
|
|
|
—
|
|
|||||||
Consumer
|
234
|
|
|
235
|
|
|
99
|
|
|
248
|
|
|
—
|
|
|
242
|
|
|
—
|
|
|||||||
Ending Balance
|
10,706
|
|
|
10,740
|
|
|
2,084
|
|
|
12,757
|
|
|
28
|
|
|
12,054
|
|
|
57
|
|
|||||||
Without an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Residential real estate
|
1,451
|
|
|
1,865
|
|
|
—
|
|
|
1,774
|
|
|
2
|
|
|
1,663
|
|
|
4
|
|
|||||||
Commercial real estate
|
2,566
|
|
|
2,656
|
|
|
—
|
|
|
3,102
|
|
|
27
|
|
|
2,769
|
|
|
35
|
|
|||||||
Commercial
|
583
|
|
|
712
|
|
|
—
|
|
|
503
|
|
|
4
|
|
|
544
|
|
|
8
|
|
|||||||
Home equity
|
683
|
|
|
927
|
|
|
—
|
|
|
303
|
|
|
—
|
|
|
474
|
|
|
—
|
|
|||||||
Consumer
|
17
|
|
|
37
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|||||||
Ending Balance
|
5,300
|
|
|
6,197
|
|
|
—
|
|
|
5,699
|
|
|
33
|
|
|
5,467
|
|
|
47
|
|
|||||||
Total impaired loans
|
$
|
16,006
|
|
|
$
|
16,937
|
|
|
$
|
2,084
|
|
|
$
|
18,456
|
|
|
$
|
61
|
|
|
$
|
17,521
|
|
|
$
|
104
|
|
June 30, 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Residential real estate
|
$
|
8,964
|
|
|
$
|
8,964
|
|
|
$
|
1,346
|
|
|
$
|
9,653
|
|
|
$
|
35
|
|
|
$
|
10,273
|
|
|
$
|
64
|
|
Commercial real estate
|
5,734
|
|
|
5,734
|
|
|
397
|
|
|
6,371
|
|
|
(4
|
)
|
|
6,812
|
|
|
1
|
|
|||||||
Commercial
|
3,886
|
|
|
3,886
|
|
|
578
|
|
|
3,273
|
|
|
5
|
|
|
2,618
|
|
|
10
|
|
|||||||
Home equity
|
1,704
|
|
|
1,704
|
|
|
805
|
|
|
1,671
|
|
|
—
|
|
|
1,614
|
|
|
—
|
|
|||||||
Consumer
|
416
|
|
|
416
|
|
|
138
|
|
|
417
|
|
|
—
|
|
|
422
|
|
|
—
|
|
|||||||
Ending Balance
|
20,704
|
|
|
20,704
|
|
|
3,264
|
|
|
21,385
|
|
|
36
|
|
|
21,739
|
|
|
75
|
|
|||||||
Without an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Residential real estate
|
2,818
|
|
|
3,177
|
|
|
—
|
|
|
2,924
|
|
|
(2
|
)
|
|
2,634
|
|
|
3
|
|
|||||||
Commercial real estate
|
1,600
|
|
|
1,984
|
|
|
—
|
|
|
1,466
|
|
|
19
|
|
|
1,601
|
|
|
29
|
|
|||||||
Commercial
|
386
|
|
|
478
|
|
|
—
|
|
|
387
|
|
|
1
|
|
|
478
|
|
|
2
|
|
|||||||
Home equity
|
438
|
|
|
645
|
|
|
—
|
|
|
425
|
|
|
—
|
|
|
421
|
|
|
—
|
|
|||||||
Consumer
|
17
|
|
|
37
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|||||||
Ending Balance
|
5,259
|
|
|
6,321
|
|
|
—
|
|
|
5,219
|
|
|
18
|
|
|
5,151
|
|
|
34
|
|
|||||||
Total impaired loans
|
$
|
25,963
|
|
|
$
|
27,025
|
|
|
$
|
3,264
|
|
|
$
|
26,604
|
|
|
$
|
54
|
|
|
$
|
26,890
|
|
|
$
|
109
|
|
|
|
|
|
|
|
|
Year Ended
|
||||||||||||
|
Recorded
Investment
|
|
Unpaid
Principal
Balance
|
|
Related
Allowance
|
|
Average
Recorded
Investment
|
|
Interest
Income
Recognized
|
||||||||||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Residential real estate
|
$
|
7,713
|
|
|
$
|
7,713
|
|
|
$
|
1,220
|
|
|
$
|
9,524
|
|
|
$
|
125
|
|
Commercial real estate
|
3,419
|
|
|
3,419
|
|
|
251
|
|
|
4,911
|
|
|
—
|
|
|||||
Commercial
|
1,390
|
|
|
1,390
|
|
|
168
|
|
|
2,466
|
|
|
8
|
|
|||||
Home equity
|
1,410
|
|
|
1,410
|
|
|
496
|
|
|
1,545
|
|
|
—
|
|
|||||
Consumer
|
254
|
|
|
254
|
|
|
104
|
|
|
358
|
|
|
—
|
|
|||||
Ending Balance
|
14,186
|
|
|
14,186
|
|
|
2,239
|
|
|
18,804
|
|
|
133
|
|
|||||
Without an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential real estate
|
1,943
|
|
|
2,604
|
|
|
—
|
|
|
2,257
|
|
|
13
|
|
|||||
Commercial real estate
|
4,239
|
|
|
4,502
|
|
|
—
|
|
|
2,869
|
|
|
59
|
|
|||||
Commercial
|
463
|
|
|
606
|
|
|
—
|
|
|
791
|
|
|
11
|
|
|||||
Home equity
|
331
|
|
|
581
|
|
|
—
|
|
|
399
|
|
|
—
|
|
|||||
Consumer
|
17
|
|
|
37
|
|
|
—
|
|
|
21
|
|
|
—
|
|
|||||
Ending Balance
|
6,993
|
|
|
8,330
|
|
|
—
|
|
|
6,337
|
|
|
83
|
|
|||||
Total impaired loans
|
$
|
21,179
|
|
|
$
|
22,516
|
|
|
$
|
2,239
|
|
|
$
|
25,141
|
|
|
$
|
216
|
|
|
Goodwill
|
||||||||||
|
Banking
|
|
Financial
Services
|
|
Total
|
||||||
June 30, 2015 and December 31, 2014:
|
|
|
|
|
|
|
|
|
|||
Goodwill, gross
|
$
|
40,902
|
|
|
$
|
7,474
|
|
|
$
|
48,376
|
|
Accumulated impairment losses
|
—
|
|
|
(3,570
|
)
|
|
(3,570
|
)
|
|||
Reported goodwill at June 30, 2015 and December 31, 2014
|
$
|
40,902
|
|
|
$
|
3,904
|
|
|
$
|
44,806
|
|
|
Core Deposit Intangible
|
|
Trust Relationship Intangible
|
||||||||||||||||||||
|
Total
|
|
Accumulated Amortization
|
|
Net
|
|
Total
|
|
Accumulated Amortization
|
|
Net
|
||||||||||||
Balance at December 31, 2014
|
$
|
17,300
|
|
|
$
|
(14,161
|
)
|
|
$
|
3,139
|
|
|
$
|
753
|
|
|
$
|
(527
|
)
|
|
$
|
226
|
|
2015 amortization
|
—
|
|
|
(537
|
)
|
|
(537
|
)
|
|
—
|
|
|
(38
|
)
|
|
(38
|
)
|
||||||
Balance at June 30, 2015
|
$
|
17,300
|
|
|
$
|
(14,698
|
)
|
|
$
|
2,602
|
|
|
$
|
753
|
|
|
$
|
(565
|
)
|
|
$
|
188
|
|
|
Core Deposit
Intangible
|
|
Trust
Relationship
Intangible
|
||||
2015
|
$
|
537
|
|
|
$
|
38
|
|
2016
|
1,073
|
|
|
75
|
|
||
2017
|
992
|
|
|
75
|
|
||
Total
|
$
|
2,602
|
|
|
$
|
188
|
|
|
|
Current Regulatory Guidance
|
|
Prior Regulatory Guidance
|
||||||||||||||
|
|
June 30,
2015 |
|
Minimum Regulatory Capital Required
|
|
Minimum Regulatory Provision To Be "Well Capitalized" Under Prompt Corrective Action Provisions
|
|
December 31,
2014 |
|
Minimum Regulatory Capital Required
|
|
Minimum Regulatory Provision To Be "Well Capitalized" Under Prompt Corrective Action Provisions
|
||||||
Camden National Corporation:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total risk-based capital ratio
|
|
14.78
|
%
|
|
8.00
|
%
|
|
N/A
|
|
|
15.16
|
%
|
|
8.00
|
%
|
|
N/A
|
|
Tier I risk-based capital ratio
|
|
13.66
|
%
|
|
6.00
|
%
|
|
N/A
|
|
|
13.97
|
%
|
|
4.00
|
%
|
|
N/A
|
|
Common equity Tier I risk-based capital ratio
(1)
|
|
11.40
|
%
|
|
4.50
|
%
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
Tier I leverage capital ratio
|
|
9.39
|
%
|
|
4.00
|
%
|
|
N/A
|
|
|
9.26
|
%
|
|
4.00
|
%
|
|
N/A
|
|
Camden National Bank:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total risk-based capital ratio
|
|
13.45
|
%
|
|
8.00
|
%
|
|
10.00
|
%
|
|
13.85
|
%
|
|
8.00
|
%
|
|
10.00
|
%
|
Tier I risk-based capital ratio
|
|
12.33
|
%
|
|
6.00
|
%
|
|
8.00
|
%
|
|
12.65
|
%
|
|
4.00
|
%
|
|
6.00
|
%
|
Common equity Tier I risk-based capital ratio
(1)
|
|
12.33
|
%
|
|
4.50
|
%
|
|
6.50
|
%
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
Tier I leverage capital ratio
|
|
8.48
|
%
|
|
4.00
|
%
|
|
5.00
|
%
|
|
8.38
|
%
|
|
4.00
|
%
|
|
5.00
|
%
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended June 30,
|
||||||||||||
Net periodic benefit cost
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Service cost
|
|
$
|
77
|
|
|
$
|
67
|
|
|
$
|
154
|
|
|
$
|
134
|
|
Interest cost
|
|
106
|
|
|
114
|
|
|
212
|
|
|
228
|
|
||||
Recognized net actuarial loss
|
|
54
|
|
|
35
|
|
|
108
|
|
|
70
|
|
||||
Recognized prior service cost
|
|
5
|
|
|
5
|
|
|
10
|
|
|
10
|
|
||||
Net period benefit cost
(1)
|
|
$
|
242
|
|
|
$
|
221
|
|
|
$
|
484
|
|
|
$
|
442
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
Net periodic benefit cost
|
|
2015
|
|
2014
|
|
2015
|
|
2015
|
||||||||
Service cost
|
|
$
|
15
|
|
|
$
|
11
|
|
|
$
|
30
|
|
|
$
|
22
|
|
Interest cost
|
|
29
|
|
|
33
|
|
|
58
|
|
|
66
|
|
||||
Recognized net actuarial loss
|
|
6
|
|
|
2
|
|
|
12
|
|
|
4
|
|
||||
Amortization of prior service credit
|
|
(6
|
)
|
|
(10
|
)
|
|
(12
|
)
|
|
(10
|
)
|
||||
Net period benefit cost
(1)
|
|
$
|
44
|
|
|
$
|
36
|
|
|
$
|
88
|
|
|
$
|
82
|
|
•
|
84
unrestricted stock awards were issued to a newly appointed director of the Company under the Independent Directors' Equity Compensation Program. The unrestricted stock awards fully vested on the January 1, 2015 grant date. The fair value of the share awards issued was determined using the closing market price of the Company's stock on December 31, 2014 of
$39.84
per share.
|
•
|
A total of
6,281
restricted stock awards and restricted stock units were granted at a fair value of
$37.31
per share, based on the closing market price of the Company’s common stock on the March 6, 2015 grant date. The restricted stock awards vest pro-rata over a
three
-year period, while the restricted stock units vest pro-rata over a
three
-year period subject to the achievement of certain performance measures. The holders of the restricted stock awards participate fully in the rewards of stock ownership of the Company, including voting and dividend rights.
|
•
|
9,379
shares of the Company's common stock were purchased under the MSPP at a one-third discount, based on the closing market price of the Company's common stock on the March 6, 2015 grant date of
$37.31
, in lieu of the officers and executive officers annual incentive bonus. The shares fully vest after
two
years of service from the grant date.
|
•
|
2,406
deferred stock awards were issued to certain executive officers under the DCRP. The stock awards have been determined to have a fair value of
$38.85
per unit, based on the closing market price of the Company's common stock on the March 13, 2015 grant date.
|
•
|
3,030
unrestricted stock awards were issued to the directors of the Company and Bank under the Independent Directors' Equity Compensation Program. The unrestricted stock awards fully vested immediately on the May 1, 2015 grant date. The fair value of the share awards issued was determined using the closing market price of the Company's stock on May 1, 2015 of
$38.36
per share.
|
|
Fair
Value
|
|
Readily
Available
Market
Prices
(Level 1)
|
|
Observable
Market
Data
(Level 2)
|
|
Company
Determined
Fair Value
(Level 3)
|
||||||||
June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Loans held for sale
|
$
|
1,426
|
|
|
$
|
—
|
|
|
$
|
1,426
|
|
|
$
|
—
|
|
AFS securities:
|
|
|
|
|
|
|
|
|
|
|
|||||
Obligations of U.S. government-sponsored enterprises
|
5,051
|
|
|
—
|
|
|
5,051
|
|
|
—
|
|
||||
Obligations of states and political subdivisions
|
21,673
|
|
|
—
|
|
|
21,673
|
|
|
—
|
|
||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
383,267
|
|
|
—
|
|
|
383,267
|
|
|
—
|
|
||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
326,873
|
|
|
—
|
|
|
326,873
|
|
|
—
|
|
||||
Private issue collateralized mortgage obligations
|
5,492
|
|
|
—
|
|
|
5,492
|
|
|
—
|
|
||||
Customer interest rate swap agreements
|
780
|
|
|
—
|
|
|
780
|
|
|
—
|
|
||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest rate swap agreements
|
7,991
|
|
|
—
|
|
|
7,991
|
|
|
—
|
|
||||
Forward-starting interest rate swap agreements
|
348
|
|
|
—
|
|
|
348
|
|
|
—
|
|
||||
Customer interest rate swap agreements
|
780
|
|
|
—
|
|
|
780
|
|
|
—
|
|
||||
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
AFS securities:
|
|
|
|
|
|
|
|
|
|
|
|||||
Obligations of U.S. government-sponsored enterprises
|
$
|
5,027
|
|
|
$
|
—
|
|
|
$
|
5,027
|
|
|
$
|
—
|
|
Obligations of states and political subdivisions
|
26,777
|
|
|
—
|
|
|
26,777
|
|
|
—
|
|
||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
381,308
|
|
|
—
|
|
|
381,308
|
|
|
—
|
|
||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
343,897
|
|
|
—
|
|
|
343,897
|
|
|
—
|
|
||||
Private issue collateralized mortgage obligations
|
6,054
|
|
|
—
|
|
|
6,054
|
|
|
—
|
|
||||
Customer interest rate swap agreements
|
1,140
|
|
|
—
|
|
|
1,140
|
|
|
—
|
|
||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest rate swap agreements
|
9,143
|
|
|
—
|
|
|
9,143
|
|
|
—
|
|
||||
Customer interest rate swap agreements
|
1,140
|
|
|
—
|
|
|
1,140
|
|
|
—
|
|
|
Fair
Value
|
|
Readily
Available
Market
Prices
(Level 1)
|
|
Observable
Market
Data
(Level 2)
|
|
Company
Determined
Fair Value
(Level 3)
|
||||||||
June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Collateral-dependent impaired loans
|
$
|
2,436
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,436
|
|
MSRs
(1)
|
387
|
|
|
—
|
|
|
387
|
|
|
—
|
|
||||
Non-financial assets:
|
|
|
|
|
|
|
|
||||||||
OREO
|
651
|
|
|
—
|
|
|
—
|
|
|
651
|
|
||||
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Collateral-dependent impaired loans
|
$
|
3,581
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,581
|
|
MSRs
(1)
|
173
|
|
|
—
|
|
|
173
|
|
|
—
|
|
||||
Non-financial assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
OREO
|
1,282
|
|
|
—
|
|
|
—
|
|
|
1,282
|
|
|
Fair Value
|
|
Valuation Methodology
|
|
Unobservable input
|
|
Discount Range
(Weighted-Average)
|
|||
June 30, 2015
|
|
|
|
|
|
|
|
|
||
Collateral-dependent impaired loans:
|
|
|
|
|
|
|
|
|
|
|
Partially charged-off
|
$
|
1,225
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment of appraisal
|
|
0%
|
(0%)
|
|
|
|
|
|
Estimated selling costs
|
|
0 - 10%
|
(8%)
|
||
Specifically reserved
|
1,211
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment of appraisal
|
|
0 - 50%
|
(14%)
|
|
|
|
|
|
|
Estimated selling costs
|
|
10%
|
(10%)
|
||
OREO
|
651
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment of appraisal
|
|
0 - 28%
|
(10%)
|
|
|
|
|
|
|
Estimated selling cost
|
|
6 - 10%
|
(10%)
|
||
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
Collateral-dependent impaired loans:
|
|
|
|
|
|
|
|
|
|
|
Partially charged-off
|
$
|
1,569
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment
of appraisal |
|
0 - 17%
|
(0%)
|
|
|
|
|
|
Estimated selling costs
|
|
10%
|
(10%)
|
||
Specifically reserved
|
2,012
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment
of appraisal |
|
0 - 50%
|
(22%)
|
|
|
|
|
|
|
Estimated selling costs
|
|
10%
|
(10%)
|
||
OREO
|
1,282
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment
of appraisal |
|
0 - 68%
|
(21%)
|
|
|
|
|
|
|
Estimated selling costs
|
|
6 - 10%
|
(9%)
|
|
Carrying
Amount
|
|
Fair Value
|
|
Readily
Available
Market
Prices
(Level 1)
|
|
Observable
Market
Prices
(Level 2)
|
|
Company
Determined
Market
Prices
(Level 3)
|
||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and due from banks
|
$
|
55,495
|
|
|
$
|
55,495
|
|
|
$
|
55,495
|
|
|
$
|
—
|
|
|
$
|
—
|
|
AFS securities
|
742,356
|
|
|
742,356
|
|
|
—
|
|
|
742,356
|
|
|
—
|
|
|||||
HTM securities
|
60,234
|
|
|
59,809
|
|
|
—
|
|
|
59,809
|
|
|
—
|
|
|||||
Loans held for sale
|
1,426
|
|
|
1,426
|
|
|
—
|
|
|
1,426
|
|
|
—
|
|
|||||
Residential real estate loans
|
581,894
|
|
|
592,135
|
|
|
—
|
|
|
—
|
|
|
592,135
|
|
|||||
Commercial real estate loans
|
654,775
|
|
|
648,031
|
|
|
—
|
|
|
—
|
|
|
648,031
|
|
|||||
Commercial loans
|
254,455
|
|
|
253,203
|
|
|
—
|
|
|
—
|
|
|
253,203
|
|
|||||
Home equity loans
|
278,611
|
|
|
280,108
|
|
|
—
|
|
|
—
|
|
|
280,108
|
|
|||||
Consumer loans
|
16,078
|
|
|
16,450
|
|
|
—
|
|
|
—
|
|
|
16,450
|
|
|||||
MSRs
(1)
|
528
|
|
|
1,360
|
|
|
—
|
|
|
1,360
|
|
|
—
|
|
|||||
Interest receivable
|
6,752
|
|
|
6,752
|
|
|
—
|
|
|
6,752
|
|
|
—
|
|
|||||
Customer interest rate swap agreements
|
780
|
|
|
780
|
|
|
—
|
|
|
780
|
|
|
—
|
|
|||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Deposits
|
$
|
1,981,131
|
|
|
$
|
1,982,300
|
|
|
$
|
1,383,678
|
|
|
$
|
598,622
|
|
|
$
|
—
|
|
FHLB advances
|
56,001
|
|
|
57,527
|
|
|
—
|
|
|
57,527
|
|
|
—
|
|
|||||
Commercial repurchase agreements
|
30,075
|
|
|
31,061
|
|
|
—
|
|
|
31,061
|
|
|
—
|
|
|||||
Other borrowed funds
|
433,946
|
|
|
434,349
|
|
|
|
|
|
434,349
|
|
|
—
|
|
|||||
Junior subordinated debentures
|
44,075
|
|
|
44,075
|
|
|
—
|
|
|
44,075
|
|
|
—
|
|
|||||
Interest payable
|
511
|
|
|
511
|
|
|
511
|
|
|
—
|
|
|
—
|
|
|||||
Interest rate swap agreements
|
7,991
|
|
|
7,991
|
|
|
—
|
|
|
7,991
|
|
|
—
|
|
|||||
Forward-starting interest rate swap
agreements
|
348
|
|
|
348
|
|
|
—
|
|
|
348
|
|
|
—
|
|
|||||
Customer interest rate swap agreements
|
780
|
|
|
780
|
|
|
—
|
|
|
780
|
|
|
—
|
|
|
Carrying
Amount
|
|
Fair Value
|
|
Readily
Available
Market
Prices
(Level 1)
|
|
Observable
Market
Prices
(Level 2)
|
|
Company
Determined
Market
Prices
(Level 3)
|
||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and due from banks
|
$
|
60,813
|
|
|
$
|
60,813
|
|
|
$
|
60,813
|
|
|
$
|
—
|
|
|
$
|
—
|
|
AFS securities
|
763,063
|
|
|
763,063
|
|
|
—
|
|
|
763,063
|
|
|
—
|
|
|||||
HTM securities
|
20,179
|
|
|
20,425
|
|
|
—
|
|
|
20,425
|
|
|
—
|
|
|||||
Residential real estate loans
|
579,946
|
|
|
596,172
|
|
|
—
|
|
|
—
|
|
|
596,172
|
|
|||||
Commercial real estate loans
|
635,609
|
|
|
631,434
|
|
|
—
|
|
|
—
|
|
|
631,434
|
|
|||||
Commercial loans
|
249,823
|
|
|
244,713
|
|
|
—
|
|
|
—
|
|
|
244,713
|
|
|||||
Home equity loans
|
269,176
|
|
|
270,904
|
|
|
—
|
|
|
—
|
|
|
270,904
|
|
|||||
Consumer loans
|
16,940
|
|
|
17,007
|
|
|
—
|
|
|
—
|
|
|
17,007
|
|
|||||
MSRs
(1)
|
493
|
|
|
1,447
|
|
|
—
|
|
|
1,447
|
|
|
—
|
|
|||||
Interest receivable
|
6,017
|
|
|
6,017
|
|
|
—
|
|
|
6,017
|
|
|
—
|
|
|||||
Customer interest rate swap agreement
|
1,140
|
|
|
1,140
|
|
|
—
|
|
|
1,140
|
|
|
—
|
|
|||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Deposits
|
$
|
1,932,097
|
|
|
$
|
1,933,805
|
|
|
$
|
1,361,604
|
|
|
$
|
572,201
|
|
|
$
|
—
|
|
FHLB advances
|
56,039
|
|
|
57,986
|
|
|
—
|
|
|
57,986
|
|
|
—
|
|
|||||
Commercial repurchase agreements
|
30,097
|
|
|
31,395
|
|
|
—
|
|
|
31,395
|
|
|
—
|
|
|||||
Other borrowed funds
|
446,842
|
|
|
446,909
|
|
|
446,909
|
|
|
—
|
|
|
—
|
|
|||||
Junior subordinated debentures
|
44,024
|
|
|
44,024
|
|
|
—
|
|
|
44,024
|
|
|
—
|
|
|||||
Interest payable
|
537
|
|
|
537
|
|
|
537
|
|
|
—
|
|
|
—
|
|
|||||
Interest rate swap agreements
|
9,143
|
|
|
9,143
|
|
|
—
|
|
|
9,143
|
|
|
—
|
|
|||||
Customer interest rate swap agreement
|
1,140
|
|
|
1,140
|
|
|
—
|
|
|
1,140
|
|
|
—
|
|
|
June 30,
2015 |
|
December 31,
2014 |
||||
Lending-Related Instruments:
|
|
|
|
|
|
||
Loan origination commitments and unadvanced lines of credit:
|
|
|
|
|
|
||
Home equity
|
$
|
328,193
|
|
|
$
|
303,815
|
|
Commercial and commercial real estate
|
64,232
|
|
|
47,066
|
|
||
Residential
|
17,800
|
|
|
10,975
|
|
||
Letters of credit
|
3,553
|
|
|
3,103
|
|
||
Other commitments
|
610
|
|
|
1,305
|
|
||
Derivative Financial Instruments:
|
|
|
|
|
|||
Interest rate swaps
|
43,000
|
|
|
43,000
|
|
||
Forward-starting interest rate swaps
|
50,000
|
|
|
—
|
|
||
Customer loan swaps
|
79,834
|
|
|
58,234
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2015
|
|
December 31, 2014
|
||||||
Notional
Amount |
|
Trade
Date |
|
Maturity Date
|
|
Variable Index
Received |
|
Fixed Rate
Paid |
|
Fair Value
(1)
|
|
Fair Value
(1)
|
||||||
$
|
10,000
|
|
|
3/18/2009
|
|
6/30/2021
|
|
3-Month USD LIBOR
|
|
5.09%
|
|
$
|
(1,022
|
)
|
|
$
|
(1,092
|
)
|
10,000
|
|
|
7/8/2009
|
|
6/30/2029
|
|
3-Month USD LIBOR
|
|
5.84%
|
|
(2,203
|
)
|
|
(2,511
|
)
|
|||
10,000
|
|
|
5/6/2010
|
|
6/30/2030
|
|
3-Month USD LIBOR
|
|
5.71%
|
|
(2,105
|
)
|
|
(2,434
|
)
|
|||
5,000
|
|
|
3/14/2011
|
|
3/30/2031
|
|
3-Month USD LIBOR
|
|
4.35%
|
|
(1,107
|
)
|
|
(1,279
|
)
|
|||
8,000
|
|
|
5/4/2011
|
|
7/7/2031
|
|
3-Month USD LIBOR
|
|
4.14%
|
|
(1,554
|
)
|
|
(1,827
|
)
|
|||
$
|
43,000
|
|
|
|
|
|
|
|
|
|
|
$
|
(7,991
|
)
|
|
$
|
(9,143
|
)
|
(1) Presented within accrued interest and other liabilities on the consolidated statements of condition.
|
•
|
weakness in the United States economy in general and the regional and local economies within the New England region and Maine, which could result in a deterioration of credit quality, an increase in the allowance for loan losses or a reduced demand for the Company’s credit or fee-based products and services;
|
•
|
changes in trade, monetary, and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System;
|
•
|
inflation, interest rate, market, and monetary fluctuations;
|
•
|
competitive pressures, including continued industry consolidation and the increased financial services provided by non-banks;
|
•
|
volatility in the securities markets that could adversely affect the value or credit quality of the Company’s assets, impairment of goodwill, the availability and terms of funding necessary to meet the Company’s liquidity needs, and could lead to impairment in the value of securities in the Company's investment portfolio;
|
•
|
changes in information technology that require increased capital spending;
|
•
|
changes in consumer spending and savings habits;
|
•
|
changes in tax, banking, securities and insurance laws and regulations;
|
•
|
changes in accounting policies, practices and standards, as may be adopted by the regulatory agencies as well as the Financial Accounting Standards Board ("FASB"), and other accounting standard setters;
|
•
|
the ability of the Company to successfully close its merger with SBM Financial, Inc. on October 16, 2015;
|
•
|
the ability of the Company to successfully integrate SBM Financial, Inc. and The Bank of Maine following closing of the transaction; and
|
•
|
the ability of the Company to achieve cost savings as a result of the merger or in achieving such cost savings within the projected timeframe.
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended
June 30, |
||||||||||||
(In Thousands)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Non-interest expense, as presented
|
|
$
|
16,157
|
|
|
$
|
15,792
|
|
|
$
|
32,958
|
|
|
$
|
30,917
|
|
Less: merger and acquisition costs
|
|
128
|
|
|
—
|
|
|
863
|
|
|
—
|
|
||||
Non-interest expense, adjusted
|
|
$
|
16,029
|
|
|
$
|
15,792
|
|
|
$
|
32,095
|
|
|
$
|
30,917
|
|
Net interest income, as presented
|
|
$
|
20,635
|
|
|
$
|
19,243
|
|
|
$
|
40,069
|
|
|
$
|
37,651
|
|
Add: effect of tax-exempt income
|
|
410
|
|
|
214
|
|
|
756
|
|
|
411
|
|
||||
Non-interest income, as presented
|
|
6,310
|
|
|
6,509
|
|
|
12,457
|
|
|
12,196
|
|
||||
Less: net gain on sale of securities
|
|
—
|
|
|
285
|
|
|
—
|
|
|
451
|
|
||||
Net interest income and non-interest income, adjusted
|
|
$
|
27,355
|
|
|
$
|
25,681
|
|
|
$
|
53,282
|
|
|
$
|
49,807
|
|
Non-GAAP efficiency ratio
|
|
58.60
|
%
|
|
61.49
|
%
|
|
60.24
|
%
|
|
62.07
|
%
|
||||
GAAP efficiency ratio
|
|
59.96
|
%
|
|
61.32
|
%
|
|
62.75
|
%
|
|
62.02
|
%
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended
June 30, |
||||||||||||
(In Thousands)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Net interest income, as presented
|
|
$
|
20,635
|
|
|
$
|
19,243
|
|
|
$
|
40,069
|
|
|
$
|
37,651
|
|
Add: effect of tax-exempt income
|
|
410
|
|
|
214
|
|
|
756
|
|
|
411
|
|
||||
Net interest income, tax equivalent
|
|
$
|
21,045
|
|
|
$
|
19,457
|
|
|
$
|
40,825
|
|
|
$
|
38,062
|
|
(In Thousands, Except Number Of Shares And Per Share Data)
|
|
June 30,
2015
|
|
December 31, 2014
|
||||
Tangible Book Value Per Share
|
|
|
|
|
||||
Shareholders’ equity
|
|
$
|
254,540
|
|
|
$
|
245,109
|
|
Less: goodwill and other intangibles
|
|
47,596
|
|
|
48,171
|
|
||
Tangible shareholders’ equity
|
|
$
|
206,944
|
|
|
$
|
196,938
|
|
Shares outstanding at period end
|
|
7,449,645
|
|
|
7,426,222
|
|
||
Tangible book value per share
|
|
$
|
27.78
|
|
|
$
|
26.52
|
|
Book value per share
|
|
$
|
34.17
|
|
|
$
|
33.01
|
|
Tangible Equity to Tangible Assets
|
|
|
|
|
||||
Total assets
|
|
$
|
2,837,921
|
|
|
$
|
2,789,853
|
|
Less: goodwill and other intangibles
|
|
47,596
|
|
|
48,171
|
|
||
Tangible assets
|
|
$
|
2,790,325
|
|
|
$
|
2,741,682
|
|
Tangible equity to tangible assets
|
|
7.42
|
%
|
|
7.18
|
%
|
||
Shareholders' equity to assets
|
|
8.97
|
%
|
|
8.79
|
%
|
|
|
Three Months Ended
June 30, 2015 |
|
Six Months Ended
June 30, 2015 |
||||||||||||
(In Thousands)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Net income, as presented
|
|
$
|
7,193
|
|
|
$
|
6,316
|
|
|
$
|
12,804
|
|
|
$
|
12,031
|
|
Amortization of intangible assets, net of tax
(1)
|
|
187
|
|
|
187
|
|
|
373
|
|
|
373
|
|
||||
Merger and acquisition costs, net of tax
(2)
|
|
115
|
|
|
—
|
|
|
768
|
|
|
—
|
|
||||
Gains on sale of securities, net of tax
(1)
|
|
—
|
|
|
(185
|
)
|
|
—
|
|
|
(293
|
)
|
||||
Core tangible operating earnings
|
|
$
|
7,495
|
|
|
$
|
6,318
|
|
|
$
|
13,945
|
|
|
$
|
12,111
|
|
Average shareholders' equity
|
|
$
|
254,255
|
|
|
$
|
231,949
|
|
|
$
|
251,011
|
|
|
$
|
232,243
|
|
Less: average goodwill and other intangible assets
|
|
47,733
|
|
|
48,880
|
|
|
47,875
|
|
|
49,023
|
|
||||
Average tangible equity
|
|
$
|
206,522
|
|
|
$
|
183,069
|
|
|
$
|
203,136
|
|
|
$
|
183,220
|
|
Core return on average tangible equity
|
|
14.56
|
%
|
|
13.84
|
%
|
|
13.84
|
%
|
|
13.33
|
%
|
||||
Return on average equity
|
|
11.35
|
%
|
|
10.92
|
%
|
|
10.29
|
%
|
|
10.45
|
%
|
|
|
Three Months Ended
June 30, 2015 |
|
Six Months Ended
June 30, 2015 |
||||||||||||
(In Thousands, Except Per Share Data)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Core Operating Earnings:
|
|
|
|
|
|
|
|
|
||||||||
Net income, as presented
|
|
$
|
7,193
|
|
|
$
|
6,316
|
|
|
$
|
12,804
|
|
|
$
|
12,031
|
|
Merger and acquisition costs, net of tax
(1)
|
|
115
|
|
|
—
|
|
|
768
|
|
|
—
|
|
||||
Gains on sale of securities, net of tax
(2)
|
|
—
|
|
|
(185
|
)
|
|
—
|
|
|
(293
|
)
|
||||
Core operating earnings
|
|
$
|
7,308
|
|
|
$
|
6,131
|
|
|
$
|
13,572
|
|
|
$
|
11,738
|
|
Core Basic EPS:
|
|
|
|
|
|
|
|
|
||||||||
Basic EPS, as presented
|
|
$
|
0.97
|
|
|
$
|
0.85
|
|
|
$
|
1.72
|
|
|
$
|
1.60
|
|
Non-core transactions impact
|
|
0.01
|
|
|
(0.02
|
)
|
|
0.10
|
|
|
(0.04
|
)
|
||||
Core basic EPS
|
|
$
|
0.98
|
|
|
$
|
0.83
|
|
|
$
|
1.82
|
|
|
$
|
1.56
|
|
Core Diluted EPS:
|
|
|
|
|
|
|
|
|
||||||||
Diluted EPS, as presented
|
|
$
|
0.96
|
|
|
$
|
0.85
|
|
|
$
|
1.71
|
|
|
$
|
1.60
|
|
Non-core transactions impact
|
|
0.01
|
|
|
(0.02
|
)
|
|
0.10
|
|
|
(0.04
|
)
|
||||
Core diluted EPS
|
|
$
|
0.97
|
|
|
$
|
0.83
|
|
|
$
|
1.81
|
|
|
$
|
1.56
|
|
Core Return on Average Assets:
|
|
|
|
|
|
|
|
|
||||||||
Return on average assets, as presented
|
|
1.02
|
%
|
|
0.95
|
%
|
|
0.92
|
%
|
|
0.92
|
%
|
||||
Non-core transactions impact
|
|
0.02
|
%
|
|
(0.03
|
)%
|
|
0.06
|
%
|
|
(0.02
|
)%
|
||||
Core return on average assets
|
|
1.04
|
%
|
|
0.92
|
%
|
|
0.98
|
%
|
|
0.90
|
%
|
||||
Core Return on Average Equity:
|
|
|
|
|
|
|
|
|
||||||||
Return on average equity, as presented
|
|
11.35
|
%
|
|
10.92
|
%
|
|
10.29
|
%
|
|
10.45
|
%
|
||||
Non-core transactions impact
|
|
0.18
|
%
|
|
(0.32
|
)%
|
|
0.61
|
%
|
|
(0.26
|
)%
|
||||
Core return on average equity
|
|
11.53
|
%
|
|
10.60
|
%
|
|
10.90
|
%
|
|
10.19
|
%
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30, |
||||||||||||
(In Thousands)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Provision for loan losses
|
|
$
|
251
|
|
|
$
|
649
|
|
|
$
|
691
|
|
|
$
|
1,141
|
|
Change in reserve for unfunded commitments
|
|
3
|
|
|
(6
|
)
|
|
9
|
|
|
(5
|
)
|
||||
Provision for credit losses
|
|
$
|
254
|
|
|
$
|
643
|
|
|
$
|
700
|
|
|
$
|
1,136
|
|
|
|
Three Months Ended
June 30, |
|
Change
|
|
Six Months Ended
June 30, |
|
Change
|
||||||||||||||||||||||
(In Thousands)
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
2015
|
|
2014
|
|
$
|
|
%
|
||||||||||||||
Service charges on deposit accounts
|
|
$
|
1,593
|
|
|
$
|
1,620
|
|
|
$
|
(27
|
)
|
|
(2
|
)%
|
|
$
|
3,080
|
|
|
$
|
3,089
|
|
|
$
|
(9
|
)
|
|
—
|
%
|
Other service charges and fees
|
|
1,584
|
|
|
1,543
|
|
|
41
|
|
|
3
|
%
|
|
3,094
|
|
|
2,938
|
|
|
156
|
|
|
5
|
%
|
||||||
Income from fiduciary services
|
|
1,328
|
|
|
1,349
|
|
|
(21
|
)
|
|
(2
|
)%
|
|
2,548
|
|
|
2,533
|
|
|
15
|
|
|
1
|
%
|
||||||
Brokerage and insurance commissions
|
|
502
|
|
|
459
|
|
|
43
|
|
|
9
|
%
|
|
951
|
|
|
937
|
|
|
14
|
|
|
1
|
%
|
||||||
Bank-owned life insurance
|
|
402
|
|
|
292
|
|
|
110
|
|
|
38
|
%
|
|
824
|
|
|
598
|
|
|
226
|
|
|
38
|
%
|
||||||
Mortgage banking income, net
|
|
346
|
|
|
70
|
|
|
276
|
|
|
394
|
%
|
|
585
|
|
|
142
|
|
|
443
|
|
|
312
|
%
|
||||||
Net gain on sale of securities
|
|
—
|
|
|
285
|
|
|
(285
|
)
|
|
(100
|
)%
|
|
—
|
|
|
451
|
|
|
(451
|
)
|
|
(100
|
)%
|
||||||
Other income
|
|
555
|
|
|
891
|
|
|
(336
|
)
|
|
(38
|
)%
|
|
1,375
|
|
|
1,508
|
|
|
(133
|
)
|
|
(9
|
)%
|
||||||
Total non-interest income
|
|
$
|
6,310
|
|
|
$
|
6,509
|
|
|
$
|
(199
|
)
|
|
(3
|
)%
|
|
$
|
12,457
|
|
|
$
|
12,196
|
|
|
$
|
261
|
|
|
2
|
%
|
Non-interest income as a percentage of total revenues
(1)
|
|
24
|
%
|
|
26
|
%
|
|
|
|
|
|
24
|
%
|
|
25
|
%
|
|
|
|
|
•
|
A decrease in other income of $336,000 primarily driven by loan interest rate swap income of $196,000 in the second quarter of 2014 for which no related income was recorded in the second quarter of 2015. Also, for the second quarter of 2015 we recorded lower unrealized gains of $91,000 on executive and director deferred compensation plans and lower fees of $29,000 related to our third party loan servicing relationships, primarily our MSHA servicing portfolio, compared to the same period for 2014.
|
•
|
A decrease on gains from sale of investment securities of $285,000 compared to the second quarter of 2014 as we did not sell any investment securities in the second quarter of 2015.
|
•
|
An increase in mortgage banking income of $276,000 as there was a significant increase in loans sold in the second quarter of 2015 compared to the same period for 2014. In the second quarter of 2015, we sold $7.7 million of fixed rate mortgage compared to $399,000 in the second quarter of 2014.
|
•
|
An increase in bank-owned life insurance income of $110,000 due to the additional $10.0 million investment made in the third quarter of 2014.
|
•
|
A decrease on gains from sale of investment securities of $451,000 compared to the six months ended June 30, 2014 as we did not sell any investment securities during the first six months of 2015.
|
•
|
An increase in mortgage banking income of $443,000 as there was a significant increase in loans sold in the first half of 2015 compared to the same period for 2014. In the first half of 2015, we sold $12.5 million of fixed rate mortgage loans compared to $399,000 in the same period for 2014.
|
•
|
An increase in bank-owned life insurance of $226,000 due to the additional $10.0 million investment made in the third quarter of 2014.
|
•
|
An increase in other service charges and fees of $156,000 primarily driven by higher debit card income of $143,000, of which $54,000 was an incentive fee received in the first quarter of 2015.
|
•
|
A decrease in other income of $133,000 primarily driven by lower unrealized gains on executive and director deferred compensation plans of $74,000 and lower fees of $74,000 related to our third party loan servicing relationships, primarily our MSHA servicing portfolio, compared to the same period for 2014. Partially offsetting the net decrease was higher loan interest rate swap income of $23,000 for the first six months of 2015 compared to the same period for 2014.
|
|
|
Three Months Ended
June 30, |
|
Change
|
|
Six Months Ended
June 30, |
|
Change
|
||||||||||||||||||||||
(In Thousands)
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
2015
|
|
2014
|
|
$
|
|
%
|
||||||||||||||
Salaries and employee benefits
|
|
$
|
8,484
|
|
|
$
|
8,301
|
|
|
$
|
183
|
|
|
2
|
%
|
|
$
|
16,859
|
|
|
$
|
16,281
|
|
|
$
|
578
|
|
|
4
|
%
|
Furniture, equipment and data processing
|
|
1,902
|
|
|
1,743
|
|
|
159
|
|
|
9
|
%
|
|
3,825
|
|
|
3,532
|
|
|
293
|
|
|
8
|
%
|
||||||
Net occupancy
|
|
1,239
|
|
|
1,270
|
|
|
(31
|
)
|
|
(2
|
)%
|
|
2,711
|
|
|
2,650
|
|
|
61
|
|
|
2
|
%
|
||||||
Consulting and professional fees
|
|
673
|
|
|
782
|
|
|
(109
|
)
|
|
(14
|
)%
|
|
1,264
|
|
|
1,300
|
|
|
(36
|
)
|
|
(3
|
)%
|
||||||
Other real estate owned and collection costs
|
|
449
|
|
|
515
|
|
|
(66
|
)
|
|
(13
|
)%
|
|
1,011
|
|
|
1,028
|
|
|
(17
|
)
|
|
(2
|
)%
|
||||||
Regulatory assessments
|
|
511
|
|
|
485
|
|
|
26
|
|
|
5
|
%
|
|
1,021
|
|
|
966
|
|
|
55
|
|
|
6
|
%
|
||||||
Amortization of intangible assets
|
|
287
|
|
|
287
|
|
|
—
|
|
|
—
|
%
|
|
574
|
|
|
574
|
|
|
—
|
|
|
—
|
%
|
||||||
Other expenses
|
|
2,484
|
|
|
2,409
|
|
|
75
|
|
|
3
|
%
|
|
4,830
|
|
|
4,586
|
|
|
244
|
|
|
5
|
%
|
||||||
Core operating expenses
|
|
16,029
|
|
|
15,792
|
|
|
237
|
|
|
2
|
%
|
|
32,095
|
|
|
30,917
|
|
|
1,178
|
|
|
4
|
%
|
||||||
Merger and acquisition costs
|
|
128
|
|
|
—
|
|
|
128
|
|
|
N.M.
|
|
|
863
|
|
|
—
|
|
|
863
|
|
|
N.M.
|
|
||||||
Total non-interest expense
|
|
$
|
16,157
|
|
|
$
|
15,792
|
|
|
$
|
365
|
|
|
2
|
%
|
|
$
|
32,958
|
|
|
$
|
30,917
|
|
|
$
|
2,041
|
|
|
7
|
%
|
Efficiency ratio (non-GAAP)
|
|
58.60
|
%
|
|
61.49
|
%
|
|
|
|
|
|
60.24
|
%
|
|
62.07
|
%
|
|
|
|
|
•
|
An increase in salaries and employee benefits of $183,000, or 2%, due to normal merit increases.
|
•
|
An increase in furniture, equipment and data processing costs of $159,000 driven by internal systems and software upgrades over the past year to enhance the functionality and experience for our customers and drive internal efficiencies.
|
•
|
An increase in merger and acquisition costs of $128,000 due to the pending merger with SBM. Refer to Note 11 of the consolidated financial statements for further details.
|
•
|
A decrease in consulting and professional fees of $109,000. In 2014, we engaged consultants to assist with development and implementation of certain strategic projects driving higher fees for the second quarter of 2014 compared to the second quarter of 2015.
|
•
|
An increase in merger and acquisition costs of $863,000 due to the pending merger with SBM.
|
•
|
An increase in salaries and employee benefits of $578,000 is due to normal merit increases, hiring of key loan production personnel over the past year, and higher performance-based incentives based on the year-to-date performance.
|
•
|
An increase in furniture, equipment and data processing costs of $293,000 driven by internal systems and software upgrades over the past year to enhance the functionality and experience for our customers and drive internal efficiencies.
|
•
|
An increase in other expenses of $244,000 driven by an increase in marketing and donation costs of $158,000, primarily associated with our
Hope@Home
campaign for which we provide a $100 donation to a local homeless shelters for each loan made, and higher external debit card fraud costs of $50,000.
|
|
June 30,
2015 |
|
December 31,
2014 |
||||
Residential real estate loans
|
$
|
587,720
|
|
|
$
|
585,996
|
|
Commercial real estate loans
|
660,135
|
|
|
640,661
|
|
||
Commercial loans
|
262,187
|
|
|
257,515
|
|
||
Home equity loans
|
281,057
|
|
|
271,709
|
|
||
Consumer loans
|
16,384
|
|
|
17,257
|
|
||
Net deferred fees
|
(476
|
)
|
|
(528
|
)
|
||
Total loans
|
$
|
1,807,007
|
|
|
$
|
1,772,610
|
|
Commercial Loan Portfolio
|
$
|
922,322
|
|
|
$
|
898,176
|
|
Retail Loan Portfolio
|
884,685
|
|
|
874,434
|
|
||
Commercial Portfolio Mix
|
51
|
%
|
|
51
|
%
|
||
Retail Portfolio Mix
|
49
|
%
|
|
49
|
%
|
(Dollars in Thousands)
|
|
June 30,
2015
|
|
December 31, 2014
|
||||
Non-accrual loans:
|
|
|
|
|
|
|
||
Residential real estate
|
|
$
|
4,498
|
|
|
$
|
6,056
|
|
Commercial real estate
|
|
2,813
|
|
|
7,043
|
|
||
Commercial
|
|
1,425
|
|
|
1,529
|
|
||
Consumer and home equity loans
|
|
1,957
|
|
|
2,012
|
|
||
Total non-accrual loans
|
|
10,693
|
|
|
16,640
|
|
||
Accruing loans past due 90 days
|
|
—
|
|
|
—
|
|
||
Accruing TDRs not included above
|
|
5,313
|
|
|
4,539
|
|
||
Total non-performing loans
|
|
16,006
|
|
|
21,179
|
|
||
Other real estate owned
|
|
651
|
|
|
1,587
|
|
||
Total non-performing assets
|
|
$
|
16,657
|
|
|
$
|
22,766
|
|
Non-accrual loans to total loans
|
|
0.59
|
%
|
|
0.94
|
%
|
||
Non-performing loans to total loans
|
|
0.89
|
%
|
|
1.19
|
%
|
||
ALL to non-performing loans
|
|
132.41
|
%
|
|
99.70
|
%
|
||
Non-performing assets to total assets
|
|
0.59
|
%
|
|
0.82
|
%
|
||
ALL to non-performing assets
|
|
127.24
|
%
|
|
92.75
|
%
|
(Dollars in Thousands)
|
|
June 30,
2015 |
|
December 31, 2014
|
||||
Accruing loans 30-89 days past due:
|
|
|
|
|
|
|
||
Residential real estate
|
|
$
|
1,287
|
|
|
$
|
1,303
|
|
Commercial real estate
|
|
586
|
|
|
381
|
|
||
Commercial
|
|
718
|
|
|
656
|
|
||
Consumer and home equity loans
|
|
897
|
|
|
891
|
|
||
Total accruing loans 30-89 days past due
|
|
$
|
3,488
|
|
|
$
|
3,231
|
|
Accruing loans 30-89 days past due to total loans
|
|
0.19
|
%
|
|
0.18
|
%
|
|
|
At or For The
Three Months Ended June 30, |
|
At or For The
Six Months Ended June 30, |
|
At or For The
Year Ended
December 31,
|
||||||||||||||
(Dollars in Thousands)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2014
|
||||||||||
ALL at the beginning of the period
|
|
$
|
21,265
|
|
|
$
|
21,670
|
|
|
$
|
21,116
|
|
|
$
|
21,590
|
|
|
$
|
21,590
|
|
Provision for loan losses
|
|
251
|
|
|
649
|
|
|
691
|
|
|
1,141
|
|
|
2,224
|
|
|||||
Charge-offs:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Residential real estate loans
|
|
179
|
|
|
178
|
|
|
292
|
|
|
361
|
|
|
785
|
|
|||||
Commercial real estate
|
|
48
|
|
|
5
|
|
|
103
|
|
|
176
|
|
|
361
|
|
|||||
Commercial loans
|
|
84
|
|
|
307
|
|
|
243
|
|
|
526
|
|
|
1,544
|
|
|||||
Consumer and home equity loans
|
|
163
|
|
|
70
|
|
|
260
|
|
|
146
|
|
|
754
|
|
|||||
Total loan charge-offs
|
|
474
|
|
|
560
|
|
|
898
|
|
|
1,209
|
|
|
3,444
|
|
|||||
Recoveries:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential real estate loans
|
|
17
|
|
|
42
|
|
|
20
|
|
|
134
|
|
|
165
|
|
|||||
Commercial real estate loans
|
|
54
|
|
|
11
|
|
|
64
|
|
|
50
|
|
|
135
|
|
|||||
Commercial loans
|
|
78
|
|
|
73
|
|
|
182
|
|
|
169
|
|
|
395
|
|
|||||
Consumer and home equity loans
|
|
3
|
|
|
20
|
|
|
19
|
|
|
30
|
|
|
51
|
|
|||||
Total loan recoveries
|
|
152
|
|
|
146
|
|
|
285
|
|
|
383
|
|
|
746
|
|
|||||
Net charge-offs
|
|
322
|
|
|
414
|
|
|
613
|
|
|
826
|
|
|
2,698
|
|
|||||
ALL at the end of the period
|
|
$
|
21,194
|
|
|
$
|
21,905
|
|
|
$
|
21,194
|
|
|
$
|
21,905
|
|
|
$
|
21,116
|
|
Components of allowance for credit losses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for loan losses
|
|
$
|
21,194
|
|
|
$
|
21,905
|
|
|
$
|
21,194
|
|
|
$
|
21,905
|
|
|
$
|
21,116
|
|
Liability for unfunded credit commitments
|
|
26
|
|
|
16
|
|
|
26
|
|
|
16
|
|
|
17
|
|
|||||
Balance of allowance for credit losses at end of the period
|
|
$
|
21,220
|
|
|
$
|
21,921
|
|
|
$
|
21,220
|
|
|
$
|
21,921
|
|
|
$
|
21,133
|
|
Average loans
|
|
$
|
1,802,353
|
|
|
$
|
1,675,526
|
|
|
$
|
1,791,870
|
|
|
$
|
1,633,719
|
|
|
$
|
1,681,297
|
|
Net charge-offs (annualized) to average loans
|
|
0.07
|
%
|
|
0.10
|
%
|
|
0.07
|
%
|
|
0.10
|
%
|
|
0.16
|
%
|
|||||
Provision for loan losses (annualized) to average loans
|
|
0.06
|
%
|
|
0.15
|
%
|
|
0.08
|
%
|
|
0.14
|
%
|
|
0.13
|
%
|
|||||
ALL to total loans
|
|
1.17
|
%
|
|
1.29
|
%
|
|
1.17
|
%
|
|
1.29
|
%
|
|
1.19
|
%
|
|||||
ALL to net charge-offs (annualized)
|
|
1,645.50
|
%
|
|
1,322.77
|
%
|
|
1,728.71
|
%
|
|
1,325.97
|
%
|
|
782.65
|
%
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
Year Ended
December 31, 2014
|
||||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|||||||||||
Return on average assets
|
1.02
|
%
|
|
0.95
|
%
|
|
0.92
|
%
|
|
0.92
|
%
|
|
0.92
|
%
|
|||||
Return on average equity
|
11.35
|
%
|
|
10.92
|
%
|
|
10.29
|
%
|
|
10.45
|
%
|
|
10.37
|
%
|
|||||
Average equity to average assets
|
9.03
|
%
|
|
8.66
|
%
|
|
8.97
|
%
|
|
8.79
|
%
|
|
8.83
|
%
|
|||||
Dividend payout ratio
|
34.87
|
%
|
|
33.61
|
%
|
|
34.87
|
%
|
|
33.61
|
%
|
|
33.73
|
%
|
|||||
Book value per share
|
$
|
34.17
|
|
|
$
|
32.03
|
|
|
$
|
34.17
|
|
|
$
|
32.03
|
|
|
$
|
33.01
|
|
Tangible book value per share
1
|
$
|
27.78
|
|
|
$
|
25.46
|
|
|
$
|
27.78
|
|
|
$
|
25.46
|
|
|
$
|
26.52
|
|
Dividends declared per share
|
$
|
0.30
|
|
|
$
|
0.27
|
|
|
$
|
0.60
|
|
|
$
|
0.54
|
|
|
$
|
1.11
|
|
|
|
Total Amount
|
|
Commitment Expires in:
|
||||||||||||||||
(Dollars in Thousands)
|
|
Committed
|
|
<1 Year
|
|
1 – 3 Years
|
|
4 – 5 Years
|
|
>5 Years
|
||||||||||
Letters of Credit
|
|
$
|
3,553
|
|
|
$
|
3,553
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial Commitment Letters
|
|
64,232
|
|
|
64,232
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Residential Loan Origination
|
|
17,800
|
|
|
17,800
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Home Equity Line of Credit Commitments
|
|
328,193
|
|
|
107,442
|
|
|
12,228
|
|
|
29,478
|
|
|
179,045
|
|
|||||
Other Commitments to Extend Credit
|
|
610
|
|
|
610
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
414,388
|
|
|
$
|
193,637
|
|
|
$
|
12,228
|
|
|
$
|
29,478
|
|
|
$
|
179,045
|
|
|
|
Total Amount
|
|
Payments Due per Period
|
||||||||||||||||
(Dollars in Thousands)
|
|
of Obligations
|
|
<1 Year
|
|
1 – 3 Years
|
|
4 – 5 Years
|
|
>5 Years
|
||||||||||
Operating Leases
|
|
$
|
6,010
|
|
|
$
|
1,305
|
|
|
$
|
1,893
|
|
|
$
|
1,209
|
|
|
$
|
1,603
|
|
Capital Leases
(1)
|
|
1,383
|
|
|
129
|
|
|
253
|
|
|
253
|
|
|
748
|
|
|||||
FHLBB Borrowings
|
|
352,701
|
|
|
307,701
|
|
|
35,000
|
|
|
10,000
|
|
|
—
|
|
|||||
Commercial Repurchase Agreements
|
|
30,075
|
|
|
—
|
|
|
30,075
|
|
|
—
|
|
|
—
|
|
|||||
Retail Repurchase Agreements
|
|
136,293
|
|
|
136,293
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Junior Subordinated Debentures
|
|
44,075
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,075
|
|
|||||
Other Contractual Obligations
|
|
2,286
|
|
|
2,286
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
572,823
|
|
|
$
|
447,714
|
|
|
$
|
67,221
|
|
|
$
|
11,462
|
|
|
$
|
46,426
|
|
|
|
Estimated Changes In
Net Interest Income |
||||
Rate Change from Year 1 - Base
|
|
June 30,
2015 |
|
June 30,
2014 |
||
Year 1
|
|
|
|
|
|
|
+200 bp
|
|
(5.92
|
)%
|
|
(5.31
|
)%
|
-100 bp
|
|
(0.71
|
)%
|
|
(0.63
|
)%
|
Year 2
|
|
|
|
|
|
|
+200 bp
|
|
(6.55
|
)%
|
|
(3.47
|
)%
|
-100 bp
|
|
(4.96
|
)%
|
|
(5.15
|
)%
|
CAMDEN NATIONAL CORPORATION
|
|||
(Registrant)
|
|||
|
|||
/s/ Gregory A. Dufour
|
|
August 7, 2015
|
|
Gregory A. Dufour
|
|
Date
|
|
President and Chief Executive Officer
(Principal Executive Office)
|
|
|
|
|
|
|
|
/s/ Deborah A. Jordan
|
|
August 7, 2015
|
|
Deborah A. Jordan
|
|
Date
|
|
Chief Operating Officer, Chief Financial Officer and
|
|
|
|
Principal Financial & Accounting Officer
|
|
|
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ Gregory A. Dufour
|
|
Gregory A. Dufour
|
|
President and Chief Executive Officer
|
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ Deborah A. Jordan
|
|
Deborah A. Jordan
|
|
Chief Operating Officer, Chief Financial Officer and
|
|
Principal Financial & Accounting Officer
|
/s/ Gregory A. Dufour
|
|
August 7, 2015
|
Gregory A. Dufour
|
|
Date
|
President and Chief Executive Officer
|
|
|
/s/ Deborah A. Jordan
|
|
August 7, 2015
|
Deborah A. Jordan
|
|
Date
|
Chief Operating Officer, Chief Financial Officer and
|
|
|
Principal Financial & Accounting Officer
|
|
|