Camden National Corporation Reports Third Quarter 2024 Earnings of $13.1 Million and Diluted EPS of $0.90

Net Interest Margin Expansion and Robust Asset Quality Drive a Strong Quarter

CAMDEN, Maine, Oct. 29, 2024 /PRNewswire/ -- Camden National Corporation (NASDAQ: CAC; "Camden National" or the "Company") today reported earnings for the quarter ended September 30, 2024 of $13.1 million and diluted earnings per share ("EPS") of $0.90, an increase of 9% and 11%, respectively, over the second quarter of 2024.

The release of the Company's quarterly financial results follows its September 10, 2024, announcement of the pending merger with Northway Financial, Inc. ("Northway"), the parent company of Northway Bank, which is subject to Northway shareholder and customary regulatory approvals. The merger will create a combined franchise with 74 branches serving attractive markets throughout a contiguous footprint in New Hampshire and Maine, with approximately $7.0 billion in assets, $5.1 billion in loans, $5.5 billion in deposits, and $2.0 billion of Assets Under Administration (AUA) as of June 30, 2024. On a combined basis, the merger is expected to be approximately 19.9% accretive to Camden National's 2025 earnings per share and 32.7% accretive to Camden National's 2026 earnings per share.

Excluding merger and acquisition costs incurred through September 30, 2024, on a non-GAAP basis, net income for the third quarter of 2024 was $13.6 million, and core EPS was $0.94, an increase of 14% and 16%, respectively, over the second quarter of 2024.

"The pending merger we announced just last month marks an important step in our journey to expand in a contiguous market with a bank that shares a similar culture, consistent credit and risk profiles, and a deep commitment to our communities," said Simon Griffiths, president and chief executive officer of Camden National Corporation.

Regarding the Company's third-quarter financial results, Griffiths commented, "Our outstanding results are driven by strong momentum, complemented by our continued exceptional credit and risk management and robust capital positions. We are confident that our strategic investments in talent, technology, products, and services will continue to benefit us as macroeconomic conditions improve."

For the nine months ended September 30, 2024, the Company reported net income of $38.3 million and diluted EPS of $2.62, compared to $34.9 million and $2.39, respectively, for the nine months ended September 30, 2023. On a non-GAAP basis, core net income for the nine months ended September 30, 2024, was $38.2 million and core EPS was $2.61, compared to $40.6 million and $2.77, respectively, for the same period in 2023.

THIRD QUARTER 2024 HIGHLIGHTS

• Our net interest margin for the third quarter of 2024 was 2.46%, an increase of 10 basis points over the second quarter of 2024.
• For the third quarter of 2024, our return on average assets was 0.91%, our return on average equity was 10.04% and, on a non-GAAP basis, our return on average tangible equity was 12.40%. Excluding merger and acquisition costs, on a non-GAAP basis, our core return on average assets was 0.95% and core return on average tangible equity was 12.94%.
• Our asset quality continues to be very strong, highlighted by loans 30-89 days past due improving since June 30, 2024, by 2 basis points to 0.03% of total loans, and non-performing loans improving by 6 basis points in the third quarter to 0.17% of total loans at September 30, 2024.
• Our capital position remained strong with regulatory capital ratios well in excess of required regulatory levels. As of September 30, 2024, our common equity ratio was 9.22% and, on a non-GAAP basis, our tangible common equity ratio was 7.69%, an increase of 34 basis points and 35 basis points, respectively, since June 30, 2024.

FINANCIAL CONDITION

As of September 30, 2024 and June 30, 2024, total assets were $5.7 billion.

Investments totaled $1.2 billion on September 30, 2024, an increase of 2% since June 30, 2024. Our strategy throughout the year has been primarily to redeploy investment cash flows to fund loan growth at current market interest rates to maximize our earning-asset yield and support net interest margin expansion. In the third quarter of 2024, the increase in investment balances was driven by the change in the interest rate environment that resulted in a $22.4 million increase in the fair value of our available-for-sale ("AFS") investment portfolio. As of September 30, 2024 and June 30, 2024, the duration of the Company's securities was 5.3 years and 5.5 years, respectively, and specifically, the AFS investment portfolio duration at September 30, 2024 and June 30, 2024 was 4.3 years and 4.5 years, respectively.

Loans totaled $4.1 billion on September 30, 2024, a decrease of $22.6 million since June 30, 2024. The decrease in loan balances for the third quarter of 2024 was driven by a 7% decrease in our commercial loans due to a few larger loan payoffs. In the third quarter of 2024, we sold 64% of our residential mortgage production, an increase from 52% in the second quarter of 2024. Overall, our loan pipelines continue to be solid and see activity within our markets across both retail and commercial customers. As of September 30, 2024, our committed loan pipeline totaled $109.3 million.

Asset quality continues to be a strength of the Company's financial position. We continue to review our loan portfolio for any potential concerns and, to-date, we have not identified any signs of systemic stress or increased risks as of September 30, 2024. On September 30, 2024, loans 30-89 days past due were 0.03% of total loans, a decrease of 2 basis points from June 30, 2024. Annualized net charge-offs for the third quarter of 2024 decreased by 1 basis point from the second quarter of 2024 to 0.03% of average loans. The Company's allowance for credit losses ("ACL") on loans was 0.86% as of September 30, 2024 and June 30, 2024. On September 30, 2024, the ACL was 5.1 times the total non-performing loans, compared to 3.7 times as of June 30, 2024.

Deposits totaled $4.6 billion on September 30, 2024, an increase of 1% since June 30, 2024. During the third quarter of 2024, on a non-GAAP basis, core deposits grew 2% as we benefited from normal seasonal deposit inflows during the summer months within our markets, as well as benefited from 8% savings deposits growth primarily due to the introduction of a high-yield savings product earlier in 2024.

On September 30, 2024, uninsured and uncollateralized¹ deposits accounted for 15.3% of total deposits, and available liquidity sources were 2.0 times uninsured and uncollateralized deposits.

In August 2024, we prepaid our remaining Bank Term Funding Program ("BTFP") borrowings of $170.0 million and entered into two interest rate swaps on $150.0 million of borrowings to reduce borrowing costs and extend the term of our borrowings. In doing so, we refinanced borrowings and lowered the rate from 4.76% to 4.09%.

As of September 30, 2024, the Company's regulatory capital ratios were each well in excess of regulatory capital requirements. The Company's common equity ratio was 9.22%, and, on a non-GAAP basis, its tangible common equity ratio was 7.69%, compared to 8.88% and 7.34%, respectively, at June 30, 2024.

The Company announced a cash dividend of $0.42 per share, representing an annualized dividend yield of 4.07%, based on the Company's closing share price of $41.32 as reported by NASDAQ on September 30, 2024, payable on October 31, 2024, to shareholders of record on October 15, 2024.

The Company did not repurchase any shares of its common stock during the third quarter of 2024. Through the nine months ended September 30, 2024, it repurchased 50,000 shares of its common stock at an average price of $32.19 per share.

FINANCIAL OPERATING RESULTS (Q3 2024 vs. Q2 2024)

Net income for the third quarter of 2024 was $13.1 million, an increase of $1.1 million, or 9%, compared to the second quarter of 2024. The increase was driven by the increase in net interest income of 4% between periods. Excluding merger and acquisition costs associated with the announced acquisition of Northway in September 2024, on a non-GAAP basis, core net income for the third quarter of 2024 increased $1.7 million, or 14%, over the second quarter of 2024.

Net interest income for the third quarter of 2024 was $33.6 million, an increase of $1.4 million, or 4%, compared to the second quarter of 2024. The increase was driven by the 10 basis point margin expansion between periods to 2.46% for the third quarter of 2024.

Provision expense of $239,000 was recorded for the third quarter of 2024, consisting of provision for loan losses of $283,000 and a credit for unfunded commitments of $44,000. The Company maintained an ACL to loans coverage ratio of 0.86% for the third quarter of 2024, consistent with the second quarter of 2024.

Non-interest income for the third quarter of 2024 was $11.4 million, an increase of $761,000, or 7%, over the second quarter of 2024. The increase between periods was driven by (1) an increase in mortgage banking income of $457,000 as the Company sold $62.4 million of residential mortgages in the third quarter of 2024, an increase of 17%, and the positive change in fair value on loans held for sale and loan pipelines; (2) an increase in back-to-back loan swap fee income of $133,000; and (3) an increase in debit card income of $100,000.

Non-interest expense for the third quarter of 2024 was $28.9 million, an increase of $1.6 million, or 6%, compared to the second quarter of 2024. The primary drivers for the increase were: (1) an increase in salaries and employee benefits of $944,000, which was driven by an increase in headcount due to seasonal and strategic hires, an increase in incentive accruals, and a one-time increase in employer-related taxes; and (2) merger and acquisition costs associated with the announced acquisition of Northway in September 2024 of $727,000. The increases were partially offset by lower consulting and professional fees of $361,000, driven by the timing of annual director equity grants in the second quarter of each year. Our GAAP efficiency ratio for the third quarter of 2024 was 64.23% and non-GAAP efficiency ratio was 62.39%, compared to 63.77% and 63.53% for the second quarter of 2024, respectively.

¹ Uncollateralized deposits are customer deposits for which the Company has not pledged any of its assets, including investment securities, or provided any other type of guarantee

Q3 2024 CONFERENCE CALL

Camden National Corporation will host a conference call and webcast at 3:00 p.m., Eastern Time, on Tuesday, October 29, 2024 to discuss its third quarter 2024 financial results and outlook. Participants should dial into the call 10 - 15 minutes before it begins. Information about the conference call is as follows:

Live dial-in (Domestic):	[phone]
Live dial-in (All other locations):	[phone]
Participant access code:	504894
Live webcast:	https://events.q4inc.com/attendee/685424551

A link to the live webcast will be available on Camden National's website under "About - Investor Relations" at CamdenNational.bank prior to the meeting, and a replay of the webcast will be available on Camden National's website following the conference call. The transcript of the conference call will also be available on Camden National's website approximately two days after the conference call.

ABOUT CAMDEN NATIONAL CORPORATION

Camden National Corporation (NASDAQ: CAC) is Northern New England's largest publicly traded bank holding company, with $5.7 billion in assets. Founded in 1875, Camden National Bank has 57 branches in Maine and New Hampshire, is a full-service community bank offering the latest digital banking, complemented by award-winning, personalized service. Additional information is available at CamdenNational.bank. Member FDIC. Equal Housing Lender.

Comprehensive wealth management, investment, and financial planning services are delivered by Camden National Wealth Management.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release that are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, including certain plans, expectations, goals, projections, and other statements, which are subject to numerous risks, assumptions, and uncertainties. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like "believe," "expect," "anticipate," "estimate," and "intend" or future or conditional verbs such as "will," "would," "should," "could," or "may." Certain factors that could cause actual results to differ materially from expected results include increased competitive pressures; inflation; ongoing competition in labor markets and employee turnover; deterioration in the value of Camden National's investment securities; changes in consumer spending and savings habits; changes in the interest rate environment; changes in general economic conditions; operational risks including, but not limited to, cybersecurity, fraud, pandemics and natural disasters; legislative and regulatory changes that adversely affect the business in which Camden National is engaged; turmoil and volatility in the financial services industry, including failures or rumors of failures of other depository institutions which could affect Camden National's ability to attract and retain depositors, and could affect the ability of financial services providers, including the Company, to borrow or raise capital; actions taken by governmental agencies to stabilize the financial system and the effectiveness of such actions; changes to regulatory capital requirements in response to recent developments affecting the banking sector; changes in the securities markets and other risks and uncertainties disclosed from time to time in Camden National's Annual Report on Form 10-K for the year ended December 31, 2023, as updated by other filings with the Securities and Exchange Commission ("SEC"). Further, statements regarding the potential effects of the war in Ukraine, conflict in the Middle East and other notable and global current events on the Company's business, financial condition, liquidity and results of operations may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possible materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond the Company's control. Camden National does not have any obligation to update forward-looking statements.

USE OF NON-GAAP MEASURES

In addition to evaluating the Company's results of operations in accordance with generally accepted accounting principles in the United States ("GAAP"), management supplements this evaluation with certain non-GAAP financial measures such as: core net income; core diluted earnings per share; core return on average assets; core return on average equity; pre-tax, pre-provision income; return on average tangible equity and core return on average tangible equity; the efficiency and tangible common equity ratios; tangible book value per share; core deposits and average core deposits. Management utilizes these non-GAAP financial measures for purposes of measuring our performance against our peer group and other financial institutions and analyzing our internal performance. We also believe these non-GAAP financial measures help investors better understand the Company's operating performance and trends and allow for better performance comparisons to other financial institutions. In addition, these non-GAAP financial measures remove the impact of unusual items that may obscure trends in the Company's underlying performance. These disclosures should not be viewed as a substitute for GAAP operating results, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other financial institutions. Reconciliations to the comparable GAAP financial measures can be found in this document.

ANNUALIZED DATA

Certain returns, yields and performance ratios are presented on an "annualized" basis. This is done for analytical and decision-making purposes to better discern underlying performance trends when compared to full-year or year-over-year amounts. Annualized data may not be indicative of any four-quarter period and is presented for illustrative purposes only.

Selected Financial Data (unaudited)
		At or For The Three Months Ended						At or For The Nine Months Ended
(In thousands, except number of shares and per share data)		September 30, 2024		June 30, 2024		September 30, 2023		September 30, 2024		September 30, 2023
Financial Condition Data
Loans		$ 4,116,729		$ 4,139,361		$ 4,058,413		$ 4,116,729		$ 4,058,413
Total assets		5,745,180		5,724,380		5,779,675		5,745,180		5,779,675
Deposits		4,575,226		4,514,020		4,678,406		4,575,226		4,678,406
Shareholders' equity		529,900		508,286		463,298		529,900		463,298
Operating Data and Per Share Data
Net income		$ 13,073		$ 11,993		$ 9,787		$ 38,338		$ 34,903
Core net income (non-GAAP)(1)		13,647		11,993		14,002		38,193		40,570
Pre-tax, pre-provision income (non-GAAP)(1)		16,093		15,519		11,449		45,845		45,087
Diluted EPS		0.90		0.81		0.67		2.62		2.39
Core diluted EPS (non-GAAP)(1)		0.94		0.81		0.96		2.61		2.77
Profitability Ratios
Return on average assets		0.91 %		0.84 %		0.68 %		0.89 %		0.82 %
Core return on average assets (non-GAAP)(1)		0.95 %		0.84 %		0.97 %		0.89 %		0.95 %
Return on average equity		10.04 %		9.60 %		8.25 %		10.13 %		10.00 %
Core return on average equity (non-GAAP)(1)		10.48 %		9.60 %		11.80 %		10.09 %		11.63 %
Return on average tangible equity (non-GAAP)(1)		12.40 %		11.96 %		10.48 %		12.60 %		12.72 %
Core return on average tangible equity (non-GAAP)(1)		12.94 %		11.96 %		14.94 %		12.55 %		14.77 %
GAAP efficiency ratio		64.23 %		63.77 %		69.60 %		64.58 %		63.82 %
Efficiency ratio (non-GAAP)(1)		62.39 %		63.53 %		60.63 %		63.78 %		60.87 %
Net interest margin (fully-taxable equivalent)		2.46 %		2.36 %		2.39 %		2.37 %		2.44 %
Asset Quality Ratios
ACL on loans to total loans		0.86 %		0.86 %		0.90 %		0.86 %		0.90 %
Non-performing loans to total loans		0.17 %		0.23 %		0.16 %		0.17 %		0.16 %
Loans 30-89 days past due to total loans		0.03 %		0.05 %		0.09 %		0.03 %		0.09 %
Annualized net charge-offs to average loans		0.03 %		0.04 %		0.01 %		0.03 %		0.03 %
Capital Ratios
Common equity ratio		9.22 %		8.88 %		8.02 %		9.22 %		8.02 %
Tangible common equity ratio (non-GAAP)(1)		7.69 %		7.34 %		6.47 %		7.69 %		6.47 %
Tier 1 leverage capital ratio		9.84 %		9.64 %		9.35 %		9.84 %		9.35 %
Total risk-based capital ratio		14.85 %		14.46 %		14.19 %		14.85 %		14.19 %

(1) This is a non-GAAP measure, please see "Reconciliation of non-GAAP to GAAP Financial Measures (unaudited)."

Consolidated Statements of Condition Data (unaudited)
(In thousands)		September 30, 2024		June 30, 2024		September 30, 2023		% Change Sep 2024 vs. Jun 2024		% Change Sep 2024 vs. Sep 2023
ASSETS
Cash, cash equivalents and restricted cash		$ 139,512		$ 105,560		$ 211,514		32 %		(34) %
Investments:
Trading securities		5,141		4,959		4,195		4 %		23 %
Available-for-sale securities, at fair value		603,211		579,534		589,003		4 %		2 %
Held-to-maturity securities, at amortized cost		526,251		533,600		549,961		(1) %		(4) %
Other investments		22,513		17,105		14,459		32 %		56 %
Total investments		1,157,116		1,135,198		1,157,618		2 %		- %
Loans held for sale, at fair value		11,706		14,321		11,187		(18) %		5 %
Loans:
Commercial real estate		1,707,923		1,697,979		1,653,288		1 %		3 %
Commercial		382,507		409,682		400,031		(7) %		(4) %
Residential real estate		1,762,395		1,768,357		1,752,401		- %		1 %
Consumer and home equity		263,904		263,343		252,693		- %		4 %
Total loans		4,116,729		4,139,361		4,058,413		(1) %		1 %
Less: allowance for credit losses on loans		(35,414)		(35,412)		(36,407)		- %		(3) %
Net loans		4,081,315		4,103,949		4,022,006		(1) %		1 %
Goodwill and core deposit intangible assets		95,251		95,390		95,816		- %		(1) %
Other assets		260,280		269,962		281,534		(4) %		(8) %
Total assets		$ 5,745,180		$ 5,724,380		$ 5,779,675		- %		(1) %
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Deposits:
Non-interest checking		$ 940,702		$ 921,605		$ 1,023,239		2 %		(8) %
Interest checking		1,445,828		1,465,560		1,579,991		(1) %		(8) %
Savings and money market		1,466,541		1,399,464		1,389,180		5 %		6 %
Certificates of deposit		553,481		576,563		552,111		(4) %		- %
Brokered deposits		168,674		150,828		133,885		12 %		26 %
Total deposits		4,575,226		4,514,020		4,678,406		1 %		(2) %
Short-term borrowings		516,336		552,606		470,140		(7) %		10 %
Junior subordinated debentures		44,331		44,331		44,331		- %		- %
Accrued interest and other liabilities		79,387		105,137		123,500		(24) %		(36) %
Total liabilities		5,215,280		5,216,094		5,316,377		- %		(2) %
Commitments and Contingencies
Shareholders' Equity
Common stock, no par value		116,072		115,543		114,842		- %		1 %
Retained earnings		500,927		493,974		478,664		1 %		5 %
Accumulated other comprehensive loss:
Net unrealized loss on debt securities, net of tax		(91,349)		(110,308)		(139,228)		(17) %		(34) %
Net unrealized gain on cash flow hedging derivative instruments, net of tax		4,506		9,327		9,343		(52) %		(52) %
Net unrecognized loss on postretirement plans, net of tax		(256)		(250)		(323)		2 %		(21) %
Total accumulated other comprehensive loss		(87,099)		(101,231)		(130,208)		(14) %		(33) %
Total shareholders' equity		529,900		508,286		463,298		4 %		14 %
Total liabilities and shareholders' equity		$ 5,745,180		$ 5,724,380		$ 5,779,675		- %		(1) %

Consolidated Statements of Income Data (unaudited)
		For The Three Months Ended
(In thousands, except per share data)		September 30, 2024		June 30, 2024		September 30, 2023		% Change Sep 2024 vs. Jun 2024		% Change Sep 2024 vs. Sep 2023
Interest Income
Interest and fees on loans		$ 55,484		$ 53,422		$ 50,115		4 %		11 %
Taxable interest on investments		6,622		6,807		5,814		(3) %		14 %
Nontaxable interest on investments		462		461		748		- %		(38) %
Dividend income		389		521		302		(25) %		29 %
Other interest income		764		951		690		(20) %		11 %
Total interest income		63,721		62,162		57,669		3 %		10 %
Interest Expense
Interest on deposits		25,051		24,169		20,969		4 %		19 %
Interest on borrowings		4,549		5,285		3,577		(14) %		27 %
Interest on junior subordinated debentures		534		524		539		2 %		(1) %
Total interest expense		30,134		29,978		25,085		1 %		20 %
Net interest income		33,587		32,184		32,584		4 %		3 %
Provision (credit) for credit losses		239		650		(574)		(63) %		(142) %
Net interest income after provision (credit) for credit losses		33,348		31,534		33,158		6 %		1 %
Non-Interest Income
Debit card income		3,169		3,069		3,130		3 %		1 %
Service charges on deposit accounts		2,168		2,113		2,040		3 %		6 %
Income from fiduciary services		1,817		1,870		1,641		(3) %		11 %
Brokerage and insurance commissions		1,414		1,441		1,217		(2) %		16 %
Mortgage banking income, net		973		516		583		89 %		67 %
Bank-owned life insurance		709		694		644		2 %		10 %
Net loss on sale of securities		-		-		(5,335)		- %		N.M.
Other income		1,156		942		1,152		23 %		- %
Total non-interest income		11,406		10,645		5,072		7 %		125 %
Non-Interest Expense
Salaries and employee benefits		16,545		15,601		14,744		6 %		12 %
Furniture, equipment and data processing		3,578		3,497		3,382		2 %		6 %
Net occupancy costs		1,890		1,981		1,804		(5) %		5 %
Debit card expense		1,368		1,311		1,318		4 %		4 %
Consulting and professional fees		788		1,149		897		(31) %		(12) %
Regulatory assessments		784		813		861		(4) %		(9) %
Merger and acquisition costs		727		-		-		N.M.		N.M.
Amortization of core deposit intangible assets		139		139		148		- %		(6) %
Other real estate owned and collection costs, net		94		47		(34)		100 %		(376) %
Other expenses		2,987		2,772		3,087		8 %		(3) %
Total non-interest expense		28,900		27,310		26,207		6 %		10 %
Income before income tax expense		15,854		14,869		12,023		7 %		32 %
Income Tax Expense		2,781		2,876		2,236		(3) %		24 %
Net Income		$ 13,073		$ 11,993		$ 9,787		9 %		34 %
Per Share Data
Basic earnings per share		$ 0.90		$ 0.82		$ 0.67		10 %		34 %
Diluted earnings per share		$ 0.90		$ 0.81		$ 0.67		11 %		34 %

N.M. = Not meaningful

Consolidated Statements of Income Data (unaudited)
		For the Nine Months Ended				% Change Sep 2024 vs. Sep 2023
(In thousands, except per share data)		September 30, 2024		September 30, 2023
Interest Income
Interest and fees on loans		$ 160,615		$ 144,092		11 %
Taxable interest on investments		20,456		17,629		16 %
Nontaxable interest on investments		1,388		2,273		(39) %
Dividend income		1,222		788		55 %
Other interest income		2,385		1,667		43 %
Total interest income		186,066		166,449		12 %
Interest Expense
Interest on deposits		72,398		56,046		29 %
Interest on borrowings		15,032		9,249		63 %
Interest on junior subordinated debentures		1,592		1,600		(1) %
Total interest expense		89,022		66,895		33 %
Net interest income		97,044		99,554		(3) %
(Credit) provision for credit losses		(1,213)		1,531		(179) %
Net interest income after (credit) provision for credit losses		98,257		98,023		- %
Non-Interest Income
Debit card income		9,104		9,147		- %
Service charges on deposit accounts		6,308		5,737		10 %
Income from fiduciary services		5,436		5,016		8 %
Brokerage and insurance commissions		4,094		3,462		18 %
Mortgage banking income, net		2,297		1,889		22 %
Bank-owned life insurance		2,086		1,849		13 %
Net loss on sale of securities		-		(5,335)		N.M.
Other income		3,048		3,283		(7) %
Total non-interest income		32,373		25,048		29 %
Non-Interest Expense
Salaries and employee benefits		48,100		44,605		8 %
Furniture, equipment and data processing		10,704		9,772		10 %
Net occupancy costs		5,941		5,735		4 %
Debit card expense		3,943		3,781		4 %
Consulting and professional fees		2,797		3,327		(16) %
Regulatory assessments		2,454		2,574		(5) %
Merger and acquisition costs		727		-		N.M.
Amortization of core deposit intangible assets		417		444		(6) %
Other real estate owned and collection costs, net		151		(25)		(704) %
Other expenses		8,338		9,302		(10) %
Total non-interest expense		83,572		79,515		5 %
Income before income tax expense		47,058		43,556		8 %
Income Tax Expense		8,720		8,653		1 %
Net Income		$ 38,338		$ 34,903		10 %
Per Share Data
Basic earnings per share		$ 2.63		$ 2.39		10 %
Diluted earnings per share		$ 2.62		$ 2.39		10 %

N.M. = Not meaningful

Quarterly Average Balance and Yield/Rate Analysis (unaudited)
		Average Balance						Yield/Rate
		For The Three Months Ended						For The Three Months Ended
(Dollars in thousands)		September 30, 2024		June 30, 2024		September 30, 2023		September 30, 2024		June 30, 2024		September 30, 2023
Assets
Interest-earning assets:
Interest-bearing deposits in other banks and other interest-earning assets		$ 48,914		$ 50,266		$ 48,401		4.66 %		6.06 %		4.04 %
Investments - taxable		1,138,979		1,162,941		1,177,367		2.53 %		2.58 %		2.14 %
Investments - nontaxable(1)		61,864		61,794		102,872		3.78 %		3.78 %		3.68 %
Loans(2):
Commercial real estate		1,706,509		1,701,431		1,658,125		5.41 %		5.09 %		4.84 %
Commercial(1)		375,944		387,337		391,491		6.51 %		6.51 %		6.08 %
Municipal(1)		17,186		16,351		18,888		5.17 %		4.84 %		4.41 %
Residential real estate		1,780,665		1,772,707		1,762,860		4.53 %		4.48 %		4.18 %
Consumer and home equity		264,178		260,384		252,357		7.96 %		7.93 %		7.74 %
Total loans		4,144,482		4,138,210		4,083,721		5.29 %		5.14 %		4.85 %
Total interest-earning assets		5,394,239		5,413,211		5,412,361		4.69 %		4.58 %		4.23 %
Other assets		317,319		323,065		304,439
Total assets		$ 5,711,558		$ 5,736,276		$ 5,716,800
Liabilities & Shareholders' Equity
Deposits:
Non-interest checking		$ 934,403		$ 901,774		$ 1,019,450		- %		- %		- %
Interest checking		1,440,374		1,479,201		1,584,314		2.56 %		2.52 %		2.42 %
Savings		679,118		624,034		661,126		0.95 %		0.52 %		0.14 %
Money market		760,977		760,844		721,423		3.46 %		3.41 %		2.85 %
Certificates of deposit		565,063		583,282		497,301		3.85 %		3.90 %		3.05 %
Total deposits		4,379,935		4,349,135		4,483,614		2.09 %		2.05 %		1.67 %
Borrowings:
Brokered deposits		156,618		150,799		161,623		5.25 %		5.28 %		5.07 %
Customer repurchase agreements		190,936		185,729		193,297		1.92 %		1.81 %		1.69 %
Junior subordinated debentures		44,331		44,331		44,331		4.79 %		4.75 %		4.83 %
Other borrowings		336,899		401,144		263,705		4.28 %		4.46 %		4.14 %
Total borrowings		728,784		782,003		662,956		3.90 %		4.00 %		3.70 %
Total funding liabilities		5,108,719		5,131,138		5,146,570		2.35 %		2.35 %		1.93 %
Other liabilities		84,617		102,658		99,480
Shareholders' equity		518,222		502,480		470,750
Total liabilities & shareholders' equity		$ 5,711,558		$ 5,736,276		$ 5,716,800
Net interest rate spread (fully-taxable equivalent)								2.34 %		2.23 %		2.30 %
Net interest margin (fully-taxable equivalent)								2.46 %		2.36 %		2.39 %

(1) Reported on a tax-equivalent basis calculated using the federal corporate income tax rate of 21%, including certain commercial loans.

(2) Non-accrual loans and loans held for sale are included in total average loans.

Year-to-Date Average Balance and Yield/Rate Analysis (unaudited)
		Average Balance				Yield/Rate
		For The Nine Months Ended				For The Nine Months Ended
(Dollars in thousands)		September 30, 2024		September 30, 2023		September 30, 2024		September 30, 2023
Assets
Interest-earning assets:
Interest-bearing deposits in other banks and other interest-earning assets		$ 47,893		$ 30,002		5.05 %		4.78 %
Investments - taxable		1,163,118		1,209,000		2.55 %		2.09 %
Investments - nontaxable(1)		62,014		104,518		3.78 %		3.67 %
Loans(2):
Commercial real estate		1,696,882		1,658,188		5.15 %		4.73 %
Commercial(1)		384,402		402,331		6.35 %		5.80 %
Municipal(1)		16,067		17,467		4.82 %		4.01 %
Residential real estate		1,775,502		1,742,340		4.47 %		4.01 %
Consumer and home equity		260,635		253,137		7.93 %		7.46 %
Total loans		4,133,488		4,073,463		5.15 %		4.69 %
Total interest-earning assets		5,406,513		5,416,983		4.57 %		4.09 %
Other assets		315,387		288,783
Total assets		$ 5,721,900		$ 5,705,766
Liabilities & Shareholders' Equity
Deposits:
Non-interest checking		$ 923,207		$ 1,031,700		- %		- %
Interest checking		1,469,812		1,637,231		2.54 %		2.23 %
Savings		634,478		693,468		0.57 %		0.10 %
Money market		762,131		704,360		3.39 %		2.51 %
Certificates of deposit		577,007		409,909		3.84 %		2.54 %
Total deposits		4,366,635		4,476,668		2.04 %		1.46 %
Borrowings:
Brokered deposits		146,969		206,206		5.28 %		4.64 %
Customer repurchase agreements		186,401		189,532		1.78 %		1.42 %
Junior subordinated debentures		44,331		44,331		4.80 %		4.83 %
Other borrowings		379,751		237,546		4.41 %		4.07 %
Total borrowings		757,452		677,615		3.96 %		3.55 %
Total funding liabilities		5,124,087		5,154,283		2.32 %		1.74 %
Other liabilities		92,361		84,920
Shareholders' equity		505,452		466,563
Total liabilities & shareholders' equity		$ 5,721,900		$ 5,705,766
Net interest rate spread (fully-taxable equivalent)						2.25 %		2.35 %
Net interest margin (fully-taxable equivalent)						2.37 %		2.44 %

(1) Reported on a tax-equivalent basis calculated using the federal corporate income tax rate of 21%, including certain commercial loans.

(2) Non-accrual loans and loans held for sale are included in total average loans

Asset Quality Data (unaudited)
(In thousands)		At or for the Nine Months Ended September 30, 2024		At or for the Six Months Ended June 30, 2024		At or for the Three Months Ended March 31, 2024		At or for the Year Ended December 31, 2023		At or for the Nine Months Ended September 30, 2023
Non-accrual loans:
Residential real estate		$ 2,497		$ 2,497		$ 2,473		$ 2,539		$ 2,775
Commercial real estate		130		79		205		386		92
Commercial		2,057		4,409		1,980		1,725		1,083
Consumer and home equity		666		810		1,000		798		674
Total non-accrual loans		5,350		7,795		5,658		5,448		4,624
Accruing troubled-debt restructured loans prior to adoption of ASU 2022-02		1,645		1,846		1,973		1,990		1,997
Total non-performing loans		6,995		9,641		7,631		7,438		6,621
Other real estate owned		-		-		-		-		-
Total non-performing assets		$ 6,995		$ 9,641		$ 7,631		$ 7,438		$ 6,621
Loans 30-89 days past due:
Residential real estate		$ 216		$ 400		$ 797		$ 1,290		$ 751
Commercial real estate		239		678		92		740		188
Commercial		578		539		537		2,007		2,260
Consumer and home equity		358		628		618		922		603
Total loans 30-89 days past due		$ 1,391		$ 2,245		$ 2,044		$ 4,959		$ 3,802
ACL on loans at the beginning of the period		$ 36,935		$ 36,935		$ 36,935		$ 36,922		$ 36,922
(Credit) provision for loan losses		(693)		(976)		(1,164)		1,174		288
Charge-offs:
Residential real estate		-		-		-		18		18
Commercial real estate		-		-		-		58		58
Commercial		1,157		763		309		1,560		1,101
Consumer and home equity		83		55		36		91		63
Total charge-offs		1,240		818		345		1,727		1,240
Total recoveries		(412)		(271)		(187)		(566)		(437)
Net charge-offs		828		547		158		1,161		803
ACL on loans at the end of the period		$ 35,414		$ 35,412		$ 35,613		$ 36,935		$ 36,407
Components of ACL:
ACL on loans		$ 35,414		$ 35,412		$ 35,613		$ 36,935		$ 36,407
ACL on off-balance sheet credit exposures(1)		2,743		2,787		2,325		2,353		2,670
ACL, end of period		$ 38,157		$ 38,199		$ 37,938		$ 39,288		$ 39,077
Ratios:
Non-performing loans to total loans		0.17 %		0.23 %		0.19 %		0.18 %		0.16 %
Non-performing assets to total assets		0.12 %		0.17 %		0.13 %		0.13 %		0.11 %
ACL on loans to total loans		0.86 %		0.86 %		0.86 %		0.90 %		0.90 %
Net charge-offs to average loans (annualized):
Quarter-to-date		0.03 %		0.04 %		0.02 %		0.04 %		0.01 %
Year-to-date		0.03 %		0.03 %		0.02 %		0.03 %		0.03 %
ACL on loans to non-performing loans		506.28 %		367.31 %		466.69 %		496.57 %		549.87 %
Loans 30-89 days past due to total loans		0.03 %		0.05 %		0.05 %		0.12 %		0.09 %

(1) Presented within accrued interest and other liabilities on the consolidated statements of condition.

Reconciliation of non-GAAP to GAAP Financial Measures (unaudited)
Core Net Income; Core Diluted Earnings per Share; Core Return on Average Assets; and Core Return on Average Equity:
		For the Three Months Ended						For the Nine Months Ended
(In thousands, except number of shares, per share data and ratios)		September 30, 2024		June 30, 2024		September 30, 2023		September 30, 2024		September 30, 2023
Core Net Income:
Net income, as presented		$ 13,073		$ 11,993		$ 9,787		$ 38,338		$ 34,903
Adjustment for net loss on sale of securities		-		-		5,335		-		5,335
Adjustment for Signature Bank bond (recovery) write-off		-		-		-		(910)		1,838
Adjustment for merger and acquisition costs		727		-		-		727		-
Tax impact of above adjustments(1)		(153)		-		(1,120)		38		(1,506)
Core net income		$ 13,647		$ 11,993		$ 14,002		$ 38,193		$ 40,570
Core Diluted Earnings per Share:
Diluted earnings per share, as presented		$ 0.90		$ 0.81		$ 0.67		$ 2.62		$ 2.39
Adjustment for net loss on sale of securities		-		-		0.37		-		0.37
Adjustment for Signature Bank bond (recovery) write-off		-		-		-		(0.06)		0.13
Adjustment for merger and acquisition costs		0.05		-		-		0.05		-
Tax impact of above adjustments(1)		(0.01)		-		(0.08)		-		(0.12)
Core diluted earnings per share		$ 0.94		$ 0.81		$ 0.96		$ 2.61		$ 2.77
Core Return on Average Assets:
Return on average assets, as presented		0.91 %		0.84 %		0.68 %		0.89 %		0.82 %
Adjustment for net loss on sale of securities		- %		- %		0.37 %		- %		0.13 %
Adjustment for Signature Bank bond (recovery) write-off		- %		- %		- %		(0.02) %		0.04 %
Adjustment for merger and acquisition costs		0.05 %		- %		- %		0.02 %		- %
Tax impact of above adjustments(1)		(0.01) %		- %		(0.08) %		- %		(0.04) %
Core return on average assets		0.95 %		0.84 %		0.97 %		0.89 %		0.95 %
Core Return on Average Equity:
Return on average equity, as presented		10.04 %		9.60 %		8.25 %		10.13 %		10.00 %
Adjustment for net loss on sale of securities		- %		- %		4.50 %		- %		1.53 %
Adjustment for Signature Bank bond (recovery) write-off		- %		- %		- %		(0.24) %		0.53 %
Adjustment for merger and acquisition costs		0.56 %		- %		- %		0.19 %		- %
Tax impact of above adjustments(1)		(0.12) %		- %		(0.95) %		0.01 %		(0.43) %
Core return on average equity		10.48 %		9.60 %		11.80 %		10.09 %		11.63 %

(1) Assumed a 21% tax rate.

Pre-Tax, Pre-Provision Income:
		For the Three Months Ended						For the Nine Months Ended
(In thousands)		September 30, 2024		June 30, 2024		September 30, 2023		September 30, 2024		September 30, 2023
Net income, as presented		$ 13,073		$ 11,993		$ 9,787		$ 38,338		$ 34,903
Adjustment for provision (credit) for credit losses		239		650		(574)		(1,213)		1,531
Adjustment for income tax expense		2,781		2,876		2,236		8,720		8,653
Pre-tax, pre-provision income		$ 16,093		$ 15,519		$ 11,449		$ 45,845		$ 45,087
Efficiency Ratio:
		For the Three Months Ended						For the Nine Months Ended
(Dollars in thousands)		September 30, 2024		June 30, 2024		September 30, 2023		September 30, 2024		September 30, 2023
Non-interest expense, as presented		$ 28,900		$ 27,310		$ 26,207		$ 83,572		$ 79,515
Adjustment for merger and acquisition costs		727		-		-		727		-
Adjusted non-interest expense		$ 28,173		$ 27,310		$ 26,207		$ 82,845		$ 79,515
Net interest income, as presented		$ 33,587		$ 32,184		$ 32,584		$ 97,044		$ 99,554
Adjustment for the effect of tax-exempt income(1)		165		159		237		475		701
Non-interest income, as presented		11,406		10,645		5,072		32,373		25,048
Adjustment for net loss on sale of securities		-		-		5,335		-		5,335
Core net interest income plus non-interest income		$ 45,158		$ 42,988		$ 43,228		$ 129,892		$ 130,638
GAAP efficiency ratio		64.23 %		63.77 %		69.60 %		64.58 %		63.82 %
Non-GAAP efficiency ratio		62.39 %		63.53 %		60.63 %		63.78 %		60.87 %

(1) Assumed a 21% tax rate.

Return on Average Tangible Equity and Core Return on Average Tangible Equity:
		For the Three Months Ended						For the Nine Months Ended
(Dollars in thousands)		September 30, 2024		June 30, 2024		September 30, 2023		September 30, 2024		September 30, 2023
Return on Average Tangible Equity:
Net income, as presented		$ 13,073		$ 11,993		$ 9,787		$ 38,338		$ 34,903
Adjustment for amortization of core deposit intangible assets		139		139		148		417		444
Tax impact of above adjustment(1)		(29)		(29)		(31)		(88)		(93)
Net income, adjusted for amortization of core deposit intangible assets		$ 13,183		$ 12,103		$ 9,904		$ 38,667		$ 35,254
Average equity, as presented		$ 518,222		$ 502,480		$ 470,750		$ 505,452		$ 466,563
Adjustment for average goodwill and core deposit intangible assets		(95,319)		(95,458)		(95,888)		(95,460)		(96,037)
Average tangible equity		$ 422,903		$ 407,022		$ 374,862		$ 409,992		$ 370,526
Return on average equity		10.04 %		9.60 %		8.25 %		10.13 %		10.00 %
Return on average tangible equity		12.40 %		11.96 %		10.48 %		12.60 %		12.72 %
Core Return on Average Tangible Equity:
Core net income (see "Core Net Income" table above)		$ 13,647		$ 11,993		$ 14,002		$ 38,193		$ 40,570
Adjustment for amortization of core deposit intangible assets		139		139		148		417		444
Tax impact of above adjustment(1)		(29)		(29)		(31)		(88)		(93)
Core net income, adjusted for amortization of core deposit intangible assets		$ 13,757		$ 12,103		$ 14,119		$ 38,522		$ 40,921
Core return on average tangible equity		12.94 %		11.96 %		14.94 %		12.55 %		14.77 %

(1) Assumed a 21% tax rate.

Tangible Book Value Per Share and Tangible Common Equity Ratio:
(In thousands, except number of shares, per share data and ratios)		September 30, 2024		June 30, 2024		September 30, 2023
Tangible Book Value Per Share:
Shareholders' equity, as presented		$ 529,900		$ 508,286		$ 463,298
Adjustment for goodwill and core deposit intangible assets		(95,251)		(95,390)		(95,816)
Tangible shareholders' equity		$ 434,649		$ 412,896		$ 367,482
Shares outstanding at period end		14,577,218		14,569,262		14,558,137
Book value per share		$ 36.35		$ 34.89		$ 31.82
Tangible book value per share		29.82		28.34		25.24
Tangible Common Equity Ratio:
Total assets		$ 5,745,180		$ 5,724,380		$ 5,779,675
Adjustment for goodwill and core deposit intangible assets		(95,251)		(95,390)		(95,816)
Tangible assets		$ 5,649,929		$ 5,628,990		$ 5,683,859
Common equity ratio		9.22 %		8.88 %		8.02 %
Tangible common equity ratio		7.69 %		7.34 %		6.47 %
Core Deposits:
(In thousands)		September 30, 2024		June 30, 2024		September 30, 2023
Total deposits		$ 4,575,226		$ 4,514,020		$ 4,678,406
Adjustment for certificates of deposit		(553,481)		(576,563)		(552,111)
Adjustment for brokered deposits		(168,674)		(150,828)		(133,885)
Core deposits		$ 3,853,071		$ 3,786,629		$ 3,992,410

Average Core Deposits:
		For the Three Months Ended						For the Nine Months Ended
(In thousands)		September 30, 2024		June 30, 2024		September 30, 2023		September 30, 2024		September 30, 2023
Total average deposits, as presented(1)		$ 4,379,935		$ 4,349,135		$ 4,483,614		$ 4,366,635		$ 4,476,668
Adjustment for average certificates of deposit		(565,063)		(583,282)		(497,301)		(577,007)		(409,909)
Average core deposits		$ 3,814,872		$ 3,765,853		$ 3,986,313		$ 3,789,628		$ 4,066,759

(1) Brokered deposits are excluded from total average deposits, as presented on the Average Balance, Interest and Yield/Rate analysis table.

SOURCE Camden National Corporation