CAMDEN — Camden National Corporation, the parent company of Camden National Bank, and SBM Financial, Inc., the parent company of The Bank of Maine, announced their $135 million merger this morning, which, when complete, will create Maine's largest community bank. The organization will operate under the Camden National Bank name and brand and be led by Gregory A. Dufour, president and chief executive officer of Camden National Corporation and Camden National Bank.

The publicly-held Camden National (CAC) is traded on the NASDAQ exchange, as of Monday noon, at $38.51 per share. Camden National’s net income for year-end 2014 was $24.57 million and had $2.8 billion in assets.

The acquisition increases the number of Camden National Bank branches from 44 to 68, across the state. 

The Bank of Maine is owned by SBM Financial, Inc., a limited liability company of private investors.

Bank of Maine branches locales range in geography from Saco to Boothbay Harbor, to Augusta, and to Machias and Calais.

The two entities agreed March 29 to enter into an agreement and plan of merger, subject to regulatory approval.

John Everets, chairman and chief executive officer of the Bank of Maine, will provide consulting services through the transition, according to a news release from Camden National. The combined organization will be headquartered in Camden, with several leadership positions in Portland.

"We are excited to welcome the Bank of Maine employees and customers to Camden National,” said Dufour, in the release. “The union of these two great organizations will redefine what it means to be a community bank. Together, we have a combined history of more than 320 years of providing exceptional service to the people of Maine. As the largest community bank in Maine, we are poised to continue to provide our customers and shareholders with an enduring value. We are a financially strong institution that is a leader in Maine's financial services industry and is Maine's bank for the future.”

With this latest merger, Camden National will have a combined network of 68 branches and three specialized lending locations. Camden National currently employs 480. Bank of Maine currently employs 254 more employees.

Community banks, according to a fact sheet of the Federal Deposit Insurance Corporation (FDIC), are an assembly of characteristics, mostly by their practice of basing credit decisions on local knowledge.

“They obtain most of their core deposits locally and make many of their loans to local businesses,” the FDIC said. “For this reason, they are often considered to be ‘relationship’ bankers as opposed to ‘transactional’ bankers. This means that they have specialized knowledge of their local community and their customers. Because of this expertise, community banks tend to base credit decisions on local knowledge and nonstandard data obtained through long-term relationships and are less likely to rely on the models-based underwriting used by larger banks.

The Camden National transaction expands the bank’s presence in the higher-growth Southern Maine market, according to the news release. Customers will have access to more than 85 ATMs as well as additional ATMs across the state as part of the Maine Cash Access Network. In addition, customers will also have online, mobile, text and telephone banking, Smart ATMs, as well as mobile deposit and bill pay.

"We are pleased to be joining a strong and growing institution,” said Everets, in the release. “Our two institutions share a rich history in Maine, and our combined size and shared cultures will position us to provide added scale to benefit our customers, communities and shareholders alike. I am excited for what the future holds."

"We are redefining community banking and look forward to working with our new employees from The Bank of Maine to reshape banking as we know it today," said Dufour. "This is a strong business combination that enhances our competitive market position and will allow us to realize efficiency benefits. The Bank of Maine is a well-run company with an attractive core deposit base and branch network combined with healthcare specialty lending and mortgage businesses that provide new sources of growth and diversification.”

Consideration will be paid to SBM Financial, Inc., stockholders in a combination of stock and cash valued at approximately $135 million based on Camden National's closing price of $38.60 March 27. Under the terms of the agreement, 80 percent of SBM Financial, Inc. common shares will be converted into Camden National common stock and the remaining 20 percent will be exchanged for cash.

SBM Financial, Inc., stockholders will have the option to elect to receive either 5.421 shares of Camden National common stock or $206 in cash for each SBM Financial, Inc. common share, subject to proration to ensure that in the aggregate 80 percent of SBM Financial, Inc., shares will be converted into stock.

With estimated cost savings of 37 percent of The Bank of Maine's pre-tax non-interest expenses and an anticipated closing date in the third quarter of 2015, the transaction is expected to be mid-teens accretive to Camden National's earnings per share starting in 2016, according to the release. Camden National will maintain its capital position with a pro forma tangible equity to tangible assets ratio of 7 percent.

The transaction is intended to qualify as reorganization for federal income tax purposes. As a result, the shares of SBM Financial, Inc., exchanged for Camden National stock, will be transferred on a tax-free basis. The definitive agreement has been approved by the boards of directors of both Camden National and The Bank of Maine.

The completion of the transaction is subject to stockholder and regulatory approvals for both companies. After the transaction is completed, Camden National will add two of The Bank of Maine directors to its board of directors.

RBC Capital Markets served as financial advisor and Goodwin Procter LLP served as legal counsel to Camden National. Keefe Bruyette & Woods, Inc. served as financial advisor, and Luse Gorman, P.C. served as legal counsel to The Bank of Maine.

About Camden National

Camden National Corporation is the holding company employing more than 480 Maine residents for two financial services companies including Camden National Bank and the wealth management company, Acadia Trust, N.A. Camden National Bank is a full-service community bank with a network of 44 banking offices throughout Maine and a commercial loan office in Manchester, New Hampshire. Acadia Trust offers investment management and fiduciary services with offices in Portland, Bangor and Ellsworth. Located at Camden National Bank, Camden Financial Consultants offers full-service brokerage and insurance services. Learn more atwww.CamdenNational.com. Member FDIC.

About The Bank of Maine

The Bank of Maine was organized in 1834 as Gardiner Savings Institution. In 2007, Gardiner Savings Institution changed its name to Savings Bank of Maine, and today it is known simply as The Bank of  Maine, a wholly owned  subsidiary of SBM Financial, Inc. Headquartered in Portland with 24 banking centers, 254 employees, and approximately $800 million in total assets as of Dec. 31, The Bank of Maine provides a broad range of financial services, including commercial, residential, and consumer lending, retail and commercial deposit products, and a wide variety of additional services through its branch network, loan officers, and ATMs.

A copy of the Registration Statement and Proxy Statement/Prospectus, as well as other filings containing information about Camden National and The Bank of Maine, when they become available, may be obtained at the SEC's site (http://www.sec.gov). Copies of the Registration Statement and Proxy Statement/Prospectus (when they become available) and the filings that will be incorporated by reference therein may also be obtained, free of charge, from Camden National's website at camdennational.com or by contacting Camden National Investor Relations at (207) 236-8821 or by contacting The Bank of Maine Investor Relations at (207) 518-5607.