UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 1998
Commission File No. 0-28190
CAMDEN NATIONAL CORPORATION
(Exact name of registrant as specified in its charter)
MAINE 01-04132282
(State or other jurisdiction (I.R.S. Employer
incorporation or organization) Identification No.)
2 ELM STREET, CAMDEN, ME 04843
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (207) 236-8821
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter periods that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practical date:
Outstanding at March 31, 1998: Common stock (no par value) 2,270,210
shares.
</PAGE>
<PAGE>
CAMDEN NATIONAL CORPORATION
Form 10-Q for the quarter ended March 31, 1998
TABLE OF CONTENTS OF INFORMATION REQUIRED IN REPORT
PART I.
ITEM 1. FINANCIAL INFORMATION
PAGE
Consolidated Statements of Income
Three Months Ended March 31, 1998 and 1997 3
Consolidated Statements of Comprehensive Income
Three Months Ended March 31, 1998 and 1997 4
Consolidated Statements of Conditions
March 31, 1998 and 1997 and December 31, 1997 5
Consolidated Statement of Cash Flows
Three Months Ended March 31, 1998 and 1997 6
Notes to Consolidated Financial Statements
Three Months Ended March 31, 1998 and 1997 7
Analysis of Change in Net Interest Margin
Three Months Ended March 31, 1998 and 1997 8
Average Daily Balance Sheets
Three Months Ended March 31, 1998 and 1997 9
Analysis of Volume and Rate Changes on Net Interest Income
& Expenses March 31, 1998 over March 31, 1997 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS 11-15
PART II.
ITEM 6. Exhibits and Reports on Form 8-K 15-16
SIGNATURES 17
EXHIBITS 18
</PAGE>
<PAGE>
PART I.
ITEM I. FINANCIAL INFORMATION
<TABLE>
Camden National Corporation and Subsidiaries
Consolidated Statement of Income
(unaudited)
(In Thousands, except number of
shares and per share data) Three Months Ended March 31
1998 1997
<S> <C> <C>
Interest Income
Interest and fees on loans $ 8,680 $ 7,492
Interest on U.S. Government and agency obligations 2,576 2,707
Interest on state and political subdivisions 31 61
Interest on interest rate swap agreements 33 184
Interest on federal funds sold
and other investments 241 168
------- -------
Total interest income 11,561 10,612
Interest Expense
Interest on deposits 3,679 3,251
Interest on other borrowings 1,539 1,507
Interest on interest rate swap agreements 32 176
------- -------
Total interest expense 5,250 4,934
------- -------
Net interest income 6,311 5,678
Provision for Loans Losses 324 287
------- -------
Net interest income after provision
for loan losses 5,987 5,391
Other Income
Service charges on deposit accounts 360 357
Other service charges and fees 356 294
Other 293 264
------- -------
Total other income 1,009 915
Operating Expenses
Salaries and employee benefits 1,940 1,714
Premises and fixed assets 581 526
Other 1,155 921
------- -------
Total operating expenses 3,676 3,161
------- -------
Income before income taxes 3,320 3,145
Income Taxes 1,086 1,056
------- -------
Net Income $ 2,234 $ 2,089
======= =======
Per Share Data
Earnings per share $0.98 $0.91
(Net income divided by weighted
average shares outstanding)
Cash dividends per share .40 .32
Weighted average number of shares outstanding 2,270,210 2,287,083
</TABLE>
</PAGE>
<PAGE>
Statement of Comprehensive Income
(unaudited)
<TABLE>
Three Months Ended March 31
(in thousands) 1998 1997
<S> <C> <C>
Net income
Other comprehensive income, net of tax:
Change in unrealized gains on securities 5 (23)
------- -------
Comprehensive income $ 5 $ (23)
======= =======
</TABLE>
</PAGE>
<PAGE>
Camden National Corporation and Subsidiaries
Consolidated Statement of Condition
(unaudited)
<TABLE>
(In Thousands, except number March 31, December 31,
shares and per share data) 1998 1997
<S> <C> <C>
Assets
Cash and due from banks $ 22,332 $ 13,451
Federal funds sold 0 1,100
Securities available for sale 2,317 4,312
Securities held to maturity 139,430 160,894
Other securities 14,084 14,084
Residential mortgages held for sale 11,796 7,094
Loans, less allowance for loan losses of $5,876 and
$5,640 at March 31,1998 and December 31, 1997 355,854 350,415
Bank premises and equipment 9,173 8,786
Other real estate owned 1,244 1,373
Interest receivable 3,656 3,924
Other assets 16,618 8,459
-------- --------
Total assets $576,504 $573,892
======== ========
Liabilities
Deposits:
Demand $ 51,615 $ 51,422
NOW 49,522 42,796
Money market 42,183 23,452
Savings 69,056 66,723
Certificates of deposit 224,253 189,016
-------- --------
Total deposit 436,629 373,409
Borrowings from Federal Home Loan Bank 52,076 98,514
Other borrowed funds 15,721 33,964
Accrued interest and other liabilities 8,106 5,364
Minority interest in subsidiary 86 85
-------- --------
Total liabilities 512,618 511,336
-------- --------
Stockholders' Equity
Common stock, no par value; authorized
5,000,000, issued 2,376,080 shares 2,436 2,436
Surplus 1,410 1,410
Retained earnings 64,250 62,925
Net unrealized appreciation on securities available
for sale, net of income tax 10 5
-------- --------
68,106 66,776
Less cost of 105,870 of treasury stock on
March 31, 1998 and December 31, 1997 4,220 4,220
-------- --------
Total stockholders' equity 63,886 62,556
-------- --------
Total liabilities and stockholders' equity $576,504 $573,892
======== ========
</TABLE>
</PAGE>
<PAGE>
Camden National Corporation and Subsidiaries
Consolidated Statement of Cash Flows
(unaudited)
<TABLE>
(In Thousands) Three Months Ended March 31,
1998 1997
<S> <C> <C>
Operating Activities
Net Income $ 2,234 $ 2,089
Adjustment to reconcile net income to
net cash provided by operating activities:
Provision for loan losses 324 287
Depreciation and amortization 164 134
Decrease in interest receivable 268 254
(Increase) decrease in other assets (8,145) (464)
Increase in other liabilities 2,738 1,030
Cash receipts from sale of residential loans 167 0
Origination of mortgage loans held for sale (4,869) (45)
Loss on disposal of assets 0 0
Other, net 1 7
------- -------
Net cash provided by operating activities (7,118) 3,292
------- -------
Investing Activities
Proceeds from maturities of
securities held to maturity 21,514 11,221
Proceeds from maturities of
securities available for sale 2,000 2,000
Purchase of securities held to maturity 0 (39,475)
Purchase of securities available for sale 0 0
Purchase of Federal Home Loan Bank Stock 0 (4,641)
Increase in loans (5,763) (8,721)
Net decrease in other real estate 129 323
Purchase of premises and equipment (613) (319)
Proceeds from sale of premises and equipment 0 0
Decrease (increase)in minority position 1 (4)
Net purchase of federal funds 1,100 2,075
------- -------
Net cash used by investing activities 18,368 (37,541)
------- -------
Financing Activities
Net increase (decrease) in demand deposits,
NOW accounts, and savings accounts 27,983 (4,312)
Net increase in certificates of deposit 35,237 5,928
Net (decrease)increase in short-term borrowings (64,681) 33,897
Purchase of treasury stock 0 (937)
Sale of treasury stock 0 0
Cash Dividends (908) (735)
------- -------
Net cash provided by financing activities (2,369) 33,841
------- -------
Increase in cash and equivalents 8,881 (408)
Cash and cash equivalents at beginning of year 13,451 17,233
------- -------
Cash and cash equivalents at end of period $22,332 $16,825
======= =======
</TABLE>
</PAGE>
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements were prepared in
accordance with instructions for Form 10-Q and, therefore, do not include all
disclosures required by generally accepted accounting principles for complete
presentation of financial statements. In the opinion of management, the
consolidated financial statements contain all adjustments (consisting only of
normal recurring accruals) necessary to present fairly the consolidated
balance sheets of Camden National Corporation, as of March 31, 1998,
and December 31, 1997, the consolidated statements of income for the three
months ended March 31, 1998 and March 31, 1997, the consolidated statements of
comprehensive income for the three months ended March 31, 1998 and March 31,
1998 and the consolidated statements of cash flows for the three months ended
March 31, 1998, and March 31, 1997. All significant intercompany transactions
and balances are eliminated in consolidation. The income reported for 1998
period is not necessarily indicative of the results that may be expected for
the full year.
NOTE 2 - Earnings Per Share
Earnings Per Share. Basic earnings per share data is computed based on the
weighted average number of common shares outstanding during each year.
Potential common stock is considered in the calculation of weighted average
shares outstanding for diluted earnings per share.
The following table sets forth the computation of basic and diluted earnings
per share:
Three Months Ended March 31
1998 1997
Net income, as reported 2,234 2,089
Weighted average shares 2,270,210 2,287,083
Effect of dilutive securities:
Employee stock options 51,796 39,372
Dilutive potential common shares
Adjusted weighted average shares
and assumed conversion 2,322,006 2,326,455
Basic earnings per share $ 0.98 $ 0.91
Diluted earnings per share 0.96 0.90
NOTE 3 - Excess of Cost Over Fair Value of Assets Acquired
The excess of cost over fair value of net assets acquired in branch
acquisitions is amortized to expense using the straight line method over ten
years. In March, 1998 the Bank acquired the Bucksport, Vinalhaven, Waldoboro,
and Damariscotta, Maine branches of KeyBank of Maine. The acquisition was
accounted for under the purchase method of accounting for business
combinations.
</PAGE>
<PAGE>
The following is a summary of the transaction:
Loans Acquired 7,298
Fixed Assets 365
Premium on Deposits 4,760
Other Assets 651
Deposits Assumed 52,421
Other Liabilities 75
Net Cash Received 39,422
<TABLE>
ANALYSIS OF CHANGE IN NET INTEREST MARGIN
Three Months Ending Three Months Ending
March 31, 1998 March 31, 1997
------------------- -------------------
Dollars in thousands Amount Average Amount Average
of Yield/ of Yield/
interest Rate interest Rate
-------- ------- -------- -------
<S> <C> <C> <C> <C>
Interest-earning assets:
Securities - taxable $ 2,810 6.78% $ 2,873 6.54%
Securities - nontaxable 47 6.95% 92 6.73%
Federal funds sold 11 5.57% 8 4.52%
Loans 8,734 9.59% 7,533* 9.52%
-------- ------- -------- -------
Total earning assets 11,602 8.70% 10,506 8.43%
Interest-bearing liabilities:
NOW accounts 129 1.21% 130 1.32%
Savings accounts 543 3.31% 522 3.31%
Money Market accounts 289 3.69% 191 3.17%
Certificates of deposit 2,718 5.52% 2,407 5.35%
Short-term borrowings 1,539 5.45% 1,508 5.28%
-------- ------- -------- -------
Total interest-bearing
liabilities 5,218 4.64% 4,758 4.52%
Net interest income
(fully-taxable equivalent) 6,384 5,748
Less: fully-taxable
equivalent adjustment (73) (70)
-------- --------
$ 6,311 $ 5,678
======== ========
Net Interest Rate Spread
(fully-taxable equivalent) 4.06% 3.91%
Net Interest Margin
(fully-taxable equivalent) 4.79% 4.61%
</TABLE>
*Includes net swap income figures (in thousands) - March 1998 $1 and
March 1997 $8.
Notes: Nonaccrual loans are included in total loans. Tax exempt
interest was calculated using a rate of 34% for fully-taxable
equivalent.
</PAGE>
<PAGE>
<TABLE>
AVERAGE DAILY BALANCE SHEETS
Dollars in thousands
Three Months Ended March 31,
1998 1997
---- ----
<S> <C> <C>
Interest-earning assets:
Securities - taxable $165,749 $175,774
Securities - nontaxable 2,705 5,467
Federal funds sold 790 708
Loans 364,306 316,674
-------- --------
Total earning assets 533,550 498,623
Cash and due from banks 14,038 13,112
Other assets 25,644 20,837
Less allowance for loan losses (5,640) (4,762)
-------- --------
Total assets $567,592 $527,810
======== ========
Interest-bearing liabilities:
NOW accounts $ 42,712 $ 39,438
Savings accounts 65,627 63,103
Money market accounts 31,348 24,069
Certificates of deposits 197,019 179,945
Short-term borrowings 112,956 114,261
-------- --------
Total interest-bearing liabilities 449,662 420,816
Demand deposits 48,738 43,165
Other liabilities 5,971 5,809
Shareholders' equity 63,221 58,020
-------- --------
Total liabilities and
stockholders' equity $567,592 $527,810
======== ========
</TABLE>
</PAGE>
<PAGE>
ANALYSIS OF VOLUME AND RATE CHANGES ON NET INTEREST INCOME AND EXPENSES
<TABLE>
March 1998 Over March 1997
----------------------------------
Change Change
Due to Due to Total
In thousands Volume Rate Change
------- ------- -------
<S> <C> <C> <C>
Interest-earning assets:
Securities--taxable (164) 101 (63)
Securities--nontaxable (46) 1 (45)
Federal funds sold 1 2 3
Loans 1,133 68 1,201
------- ------- -------
Total interest income 924 172 1,096
Interest-bearing liabilities:
NOW accounts 11 (12) (1)
Savings accounts 21 0 21
Money market accounts 58 40 98
Certificates of deposit 228 83 311
Short-term borrowings (17) 48 31
------- ------- -------
Total interest expense 301 159 460
Net interest income 623 13 636
(fully taxable equivalent) ======= ======= =======
</TABLE>
</PAGE>
<PAGE>
ITEM II. MANAGEMENT'S DISCUSSION OF FINANCIAL CONDITION AND RESULTS OF
OPERATION
FINANCIAL CONDITION
During the first three months of 1998, consolidated assets increased by $2.6
million to $576.5 million. This increase was the result of an increase in the
loan portfolio of $10.1 million or 2.8%. This increase was in part the result
of acquired loan assets from the purchase of four branches by one of the
Company's bank subsidiaries, Camden National Bank. This purchase accounted for
$7.2 million of the growth in the loan portfolio. The increase in loans was
somewhat offset by a reduction in the investment portfolio. During the first
quarter of 1998, the funds resulting from the cash flows and maturities in the
investment portfolio were used to fund loan growth and to pay down borrowings.
The Company did not want to aggressively purchase securities during a time of
relatively low interest rates.
The liquidity needs of the Company's financial institution subsidiaries require
the availability of cash to meet the withdrawal demands of depositors and the
credit commitments to borrowers. Deposits still represent the Company's primary
source of funds. Since December 31, 1997, deposits have increased by $63.2
million or 16.9%. The major reason for this increase was the deposits acquired
when the Company's subsidiary, Camden National Bank, purchased four branches
from KeyBank during the first quarter of 1998. Total deposits obtained through
the purchase of the four branches were $52.4 million. When the new branches
were acquired, excess deposits were ultized by paying back borrowed funds to the
Federal Home Loan Bank. Both of the Company's banking subsidiaries continue to
experience extreme competition by competitors for deposits. Therefore, other
funding sources continue to be pursued and utilized. Borrowings provide
liquidity in the form of federal funds purchased, securities sold under
agreements to repurchase, treasury tax and loan accounts, and borrowings from
the Federal Home Loan Bank. Total borrowings have decreased by $64.7 million or
48.8% since December 31, 1997. The major reason for this decrease was the
deposits acquired with the four new branches. The Company does however,views
borrowed funds as a reasonably priced alternative funding source that should be
utilized. Borrowings have continued to be a viable source of funding.
In determining the adequacy of the loan loss allowance, management relies
primarily on its review of the loan portfolio both to ascertain if there are any
probable losses to be written off, and to assess the loan portfolio in the
aggregate. Nonperforming loans are examined on an individual basis to determine
estimated probable loss. In addition, management considers current and
projected loan mix and loan volumes, historical net loan loss experience for
each loan category, and current and anticipated economic conditions affecting
each loan category. No assurance can be given, however, that adverse economic
conditions or other circumstances will not result in increased losses in the
portfolio. The Company continues to monitor and modify its allowance for loan
losses as conditions dictate. During the first three months of 1998, $324,000
was added to the reserve for loan losses, resulting in an allowance of $5.9
million, or 1.57%, of total loans outstanding. This addition to the allowance
<PAGE>
was made as a result of loan growth and not a reduction in loan quality.
Management believes that this allowance is appropriate given the current
economic conditions in the Company's service area and the overall condition of
the loan portfolio.
Under Federal Reserve Board (FRB) guidelines, bank holding companies such as
the Company are required to maintain capital based on "risk-adjusted" assets.
These guidelines apply to the Company on a consolidated basis. Under the
current guidelines, banking organizations must maintain a risk-based capital
ratio of eight percent, of which at least four percent must be in the form of
core capital. The Company's risk based capital ratios for Tier 1 and Tier 2
ratios at March 31, 1998, of 17.57% and 18.82% respectively, exceed regulatory
guidelines. The Company's ratios at December 31, 1997 were 18.2% and 19.5%.
The principal cash requirement of the Company is the payment of dividends on
common stock when declared. The Company is primarily dependent upon the payment
of cash dividends by Camden National Bank to service its commitments. During
the first three months of 1998 Camden National Bank paid dividends to the
Company in the amount of $.9 million. The Company paid dividends to
shareholders in the amount of $.9 million or .40 cents per share.
RESULTS OF OPERATIONS
Net income for the three months ended March 31, 1998 was $2,234,000, an
increase of $145,000 or 6.9% above 1997's first three month's net income of
$2,089,000. The major contributing factor was the increase in loans, which
resulted in an increase in net interest income.
NET INTEREST INCOME
Net interest income, on a fully taxable equivalent basis, for the three months
ended March 31, 1998 was $6.4 million, a 11.1% or $.6 million increase over the
net interest income for the first three months of 1997 of $5.7 million. Interest
income on loans increased by $1.2 million. This increase was primarily due the
increase in loan volume, with a slight accompanying increase in yields from
9.52% during the first three months of 1997 to 9.59% during the first three
months of 1998. The Company experienced a decrease in interest income on
investments during the first three months of 1998 compared to the same period in
1997 due to decline in volume, which was offset slightly by an increase in
yield. The Company's net interest expense on deposits and borrowings increased
by $.5 million during the first three months of 1998 compared to the same period
in 1997. This increase was due to a combination of volume and rate increases.
The Analysis of Change in Net Interest Margin, the Average Daily Balance
Sheets, and the Analysis of Volume and Rate Changes on Net Interest Income
and Expenses are provided on pages 8-9 of this report to enable the reader to
understand the components of the Company's interest income and expenses. The
first table provides an analysis of changes in net interest margin on
earnings assets; interest income earned and interest expense paid and average
rates earned and paid; and the net interest margin on earning assets for the
three months ended March 31, 1998 and 1997. The second of these tables
presents average assets liabilities and stockholders' equity for the three
months ended March 31, 1998 and 1997. The third table presents an
<PAGE>
analysis of volume and rate change on net interest income and expense from
March 31, 1997 to March 31, 1998.
The Company utilizes off-balance sheet instruments such as interest rate swap
agreements that have an effect on net interest income. The net results were
an increase in net interest income of $1,000 in the first three months of 1998
compared to an increase of $8,000 in the first three months of 1997.
NONINTEREST INCOME
There was a $94,000 or 10.3% increase in total noninterest income in the
first three months of 1998 compared to the first three months of 1997. Service
charges on deposit accounts remained relatively level for the first three
months of 1998 compared to 1997 with a slight increase of $3,000 or .8%.
Other service charges and fees increased by $62,000 or 21.0% in the first
three months of 1998 compared to 1997. The largest contributing factor to
this increase was the fee income generated by merchant assessments. Other
income increased by $29,000 from $264,000 in the first three months of 1997
to $293,000 in 1998. The major contributing factor for this increase was
trust fees.
NONINTEREST EXPENSE
There was a $515,000 or 16.3% increase in total noninterest expenses in the
first three months of 1998 compared to the first three months of 1997.
Salaries and employee benefits cost increased by $226,000 or 13.2% in the
first three months of 1998 compared to 1997. This increase was the result of
normal annual increases, additions to staff and higher pension benefit costs.
Other operating expenses increased by $234,000 or 25.4%. The major
contributing factors for this increase were equipment costs, credit card
expenses, marketing, and supply costs. With the addition of four new branches
to the Camden National Bank subsidiary higher than normal expenses were incurred
in the areas of marketing and supplies.
IMPACT OF INFLATION AND CHANGING PRICES
The Consolidated Financial Statements and related Notes thereto presented
elsewhere herein have been prepared in accordance with generally accepted
accounting principles which require the measurement of financial position and
operating results in terms of historical dollars without considering changes
in the relative purchasing power of money over time due to inflation.
Unlike many industrial companies, substantially all of the assets and
virtually all of the liabilities of the Company are monetary in nature. As a
result, interest rates have a more significant impact on the Company's
performance than the general level of inflation. Over short periods of time,
interest rates may not necessarily move in the same direction or in the same
magnitude as inflation.
RECENT ACCOUNTING PRONOUNCEMENTS
SFAS No. 125 and No. 127 relate to the accounting for transfers and servicing of
financial assets and extinguishment of certain liabilities and are effective for
years beginning January 1, 1997. The adoption of these standards did not have a
<PAGE>
material effect on the financial statements.
The Financial Accounting Standards Board issued the following statements of
accounting standards (SFAS) during 1997:
SFAS No. 128 Earnings Per Share
SFAS No. 129 Disclosure of Information about Capital Structure
SFAS No. 130 Reporting Comprehensive Income
SFAS No. 131 Disclosures about Segments of an Enterprise and Related
Information
These four statements do not change the measurement or recognition methods used
in the financial statement but rather deal with disclosure and presentation
requirements.
The financial statements for 1998 and all prior periods include the additional
disclosure requirements relating to diluted earnings per share which are
required under SFAS No. 128. Financial statement disclosures also comply with
SFAS No. 129, which summarized but does not change the Company's requirements to
disclosure information about capital structure.
SFAS No. 130 and No. 131 are effective for periods beginning after December 15,
1997. The adoption of these standards did not have a material effect on the
financial statements.
In February 1998, the Financial Standards Board issued Statement of Financial
Accounting Standards (SFAS) No. 132, "Employers' Disclosures about Pensions and
Other Post Retirement Benefits" effective for financial statements for the
fiscal year beginning after December 15, 1997. SFAS No. 132, which supersedes
the benefit disclosure requirements in FASB Statements No's 87, 88 and 106,
requires entities to standardize the disclosure requirements for pension and
other post retirement benefits to the extent practicable, requires additional
information on changes in the benefit obligations and fair value of plan assets
that will facilitate financial analysis. The Company expects no material
impact from adopting SFAS No. 132.
OTHER MATTERS
SHARE REPURCHASE PLAN. Camden National Corporation (CNC) will seek to
repurchase up to five percent of its outstanding shares during the succeeding
twelve months following the adoption of this plan. The Board of Directors
approved funding of this plan on September 4, 1996. The repurchase will be
effected as follows:
1. All of CNC's bids and repurchases of its stock during a
given day shall be effected through a single broker or
dealer, except that CNC may repurchase shares from others
provided that the same have not been solicited by or on
behalf of CNC. For this purpose, CNC shall utilize the
services of Paine Webber, A.G. Edwards & Sons, Inc., Maine
Securities Corp., Tucker Anthony, Means Investment Co., and
Edward Jones.
2. All of CNC's repurchases of its stock shall be at a price
which is not higher than the lowest current independent
offer quotation determined on the basis of reasonable
<PAGE>
inquiry. Management shall exercise its best judgement
whether to purchase stock at the then lowest current
independent offer quotation;
3. Daily volume of CNC repurchases must be in an amount that
(a) when added to the amounts of all of CNC's other repurchases
through a broker or dealer on that day, except "block purchases,"
(i.e., 2,000 or more shares repurchased from a single seller) does
not exceed one "round lot" (i.e., 100 shares) or (b) when added to
the amounts of all of CNC's other repurchases through a broker or
dealer during that day and the preceding five business days, except
"block purchases" does not exceed one twentieth of one percent
(1/20 of 1%) of the outstanding shares of CNC stock, exclusive of
shares known to be owned beneficially by affiliates, (i.e.,
approximately 1,000 shares);
4. If at any time while this plan is in effect trading in CNC's
shares of stock are reported through a consolidated system,
compliance for rule 10b-18 of the Exchange Act Rules shall
be complied with;
5. A press release was issued describing this plan.
The Camden National Bank expressed, to the Comptroller of the Currency, in a
letter dated July 23, 1996, its desire to change its capital structure by
reducing its common stock or surplus in an amount not to exceed $4,700,000 to
accommodate the above described "Share Repurchase Plan." This will reduce
the Company's excess capital position and should improve shareholder return
on equity.
In a letter dated August 16, 1996 from the Comptroller of the Currency's
office approval was granted with the understanding that the reduction in
capital will be accomplished through a reduction in Camden National Bank's
surplus account and a corresponding distribution to Camden National
Corporation, the bank's sole shareholder. As of March 31, 1998, a total
of 76,493 shares had been repurchased through this plan.
EXPANSION. The Company's subsidiary, Camden National Bank, entered
into a definitive agreement to purchase four KeyBank branches in the Mid-
Coast Maine area during the third quarter of 1997. These branches are located in
the communities of Waldoboro, Damariscotta, Vinalhaven and Bucksport. The
Company considered the acquisition of these branches a logical move in expanding
its current service area. The acquisition of these branches was completed
March 16, 1998.
Item 6. Exhibits and Reports on Form 8-K.
(a). Exhibits
(3.i.) The Articles of Incorporation of Camden National Corporation,
are incorporated herein by reference.
(3.ii.) The Bylaws of Camden National Corporation, as amended to date,
Exhibit 3.ii. to the Company's Registration Statement on Form S-4
filed with the Commission on September 25, 1995, file number
<PAGE>
33-97340, are incorporated herein by reference.
(10.1) Lease Agreement for the facility occupied by the Thomaston Branch
of Camden National Bank, filed with Form 10-K, December 31, 1995,
and is incorporated herein by reference.
(10.2) Lease Agreement for the facility occupied by the Camden Square
Branch of Camden National Bank, filed with Form 10-K, December 31,
1995, and is incorporated herein by reference.
(10.3) Lease Agreement for the facility occupied by the Audit Department
and one other tenant, filed with Form 10-K, December 31, 1995,
and is incorporated herein by reference.
(10.4) Lease Agreement for the facility occupied by the Hampden Branch
of United Bank, filed with Form 10-K, December 31, 1995, and is
incorporated herein by reference.
(10.5) Camden National Corporation 1993 Stock Option Plan, filed with
Form 10-K, December 31, 1995, and is incorporated herein by
reference.
(10.6) UnitedCorp Stock Option Plan, filed with Form 10-K, December 31,
1995, and is incorporated herein by reference.
(27) Financial Data Schedule.
(b) Reports on Form 8-K.
None filed.
SIGNATURES
Pursuant to the requirements of the Securities Acto of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
CAMDEN NATIONAL CORPORATION
(Registrant)
Keith C. Patten (signature) 05/14/98
- ------------------------------------- --------
Keith C. Patten Date
President and Chief Executive Officer
Susan M. Westfall (signature) 05/14/98
- ------------------------------------- --------
Susan M. Westfall Date
Treasurer and Chief Financial Officer
<PAGE>
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