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V O L . X X X N O. V I I A P R I L 1 , 2 0 2 4 18 B A N K I N G / F I N A N C E / I N S U R A N C E F O C U S Maine's big banks In Maine, the bank with the biggest market share is Canada's TD Bank (NYSE: TD), with around 13.4% of the state's deposit base as of June 30, 2023, according to FDIC quarterly data. e Toronto-based bank lends to a variety of industries in Maine from retail to forestry, according to Don Baker, TD Bank's commercial market president for northern New England, TD Bank's Maine deposits stood at $5.72 billion on June 30, 2023, a 0.2% uptick over the previous year, which Baker partly attributes to a blend of strength and scale with "the personal- ized feel of a regional bank." His outlook for the banking sector in 2024: With lower rates in the offing, "it is reasonable to expect that companies that were holding off on expansions, M&A deals or other investments will take on new credit to fuel those plans … We are also likely to see companies deploy some of the capital they've been holding as liquid assets." At Bangor Savings, the largest Maine-based bank and No. 2 in terms of market share, non-brokered deposits fell 10.8% in 2023 to around $5 billion, while No. 3 Camden National saw a 3.31% decrease last year. Combined deposits at 23 commercial banks declined 4% in 2023, with only five institutions out of the 23 seeing increases, Maine Bankers Association data show. Blaming a challenging "interest rate environment and well-publicized bank failures," Camden National (Nasdaq: CAC) posted a 13% drop in fourth- quarter net income and earnings on Jan. 31. As of the end of 2023, commercial real estate loans made up 40% of the total — a level that President and CEO Simon Griffiths deems "comfortable." "Our portfolio is as diverse as the needs of the business customers we serve and is favorable in all concentra- tion aspects, and we do not expect that to change," Griffiths says. He also notes that the bank's level of maturing com- mercial real estate loans is generally consistent from year to year, and that the majority of those loans will refinance with Camden National Bank. Camden National shares declined 13.5% in the year to March 20, underper- forming the 12.1% rise in the KRE Index that charts the stock market perfor- mance of U.S. regional banks. Over the same period, the broader S&P 500 stock index rose 32%. "Similar to other community banks, our stock price has decreased due to uncertain macro-environmental factors," Griffiths says. "Although our stock price is not where we would like it to be, we have a strong foundation, strong liquidity and a strong deposit base, which gives us confidence in our strategic path forward." At Bangor Savings, a mutual institu- tion owned by its depositors, commercial real estate loans made up 30% of the total in 2023, down from 34% in 2022. While the bank declined to say whether it expects to further reduce that percentage, spokeswoman Jaclyn Fish points to a diversified deposit base and loan portfolio, managed liquidity and long-term focus, and notes that the bank adapts quickly when needed. "e bank remains well-prepared to navigate into the future with resilience and integrity," she says. Smaller banks Among Maine's smaller regional banks, First National Bank — owned by Damariscotta-based First Bancorp (Nasdaq: FNLC) — posted a 24.3% decline in 2023 net income and a 9.3.% jump in deposits. e bank has also raised its allowance for loan losses to 1.13% of total loans at the end of the fourth quarter, up from 0.87% a year ear- lier and slightly above 1.12% at the end of the previous quarter. We'll always ask "And how else can we help you?" when supporting your business. Member FDIC | Equal Housing Lender machiassavings.bank We don't stop at "YES!" » C O N T I N U E D F RO M P R E V I O U S PA G E Although our stock price is not where we would like it to be, we have a strong foundation, strong liquidity and a strong deposit base, which gives us confidence in our strategic path forward. — Simon Griffiths Camden National Bank

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