About Bar Harbor Bankshares

Bar Harbor Bankshares operates as the bank holding company for Bar Harbor Bank & Trust that provides various banking products and services. The bank is a community bank headquartered in Northern New England with branches in Maine, New Hampshire and Vermont. The bank provides the technology offerings and capabilities of larger banks, accompanied by access to local decision makers who are acutely focused on their local markets. With over 500 dedicated professionals and more than 50 locations, the company is committed to servicing and building enduring relationships by providing a higher standard of banking. The company offers a variety of financial products and services designed around its customers in order to serve their banking and financial needs. Through these efforts, the company continues to be a relationship-focused community bank, maintaining its credit quality and serving businesses, entrepreneurs and individuals within its footprint. The company serves affluent and growing markets in Maine, New Hampshire, and Vermont with more than 50 thousand, 48 thousand, and 24 thousand customers, respectively in those states. Within these markets, tourism, agriculture, and fishing industries remain strong and continue to drive economic activity. These core markets have also maintained their strength through diversification into various service industries. Maine The company has full-service branches in operation and wealth management offices principally located in the regions of downeast, midcoast and central Maine, which are generally characterized as rural areas. The company also has a commercial loan production office in Portland, Maine. In Maine, the company considers its primary market areas to be Hancock, Penobscot, Washington, Kennebec, Knox, and Sagadahoc counties. The economies in these counties are based primarily on tourism, healthcare, fishing and lobstering, agriculture, state government, and small local businesses. They are also supported by a large contingent of retirees. New Hampshire The company has full-service branches in operation and wealth management offices in New Hampshire located in the Lake Sunapee, Upper Valley, and Merrimack Valley regions. Vermont The company has full-service branches in operation in Vermont. The branches are primarily located in central Vermont within the counties of Rutland, Windsor and Orange. These markets are home to many attractions, including Killington Mountain, Okemo Resort, and the city of Rutland. Popular vacation destinations in this region include Woodstock, Brandon, and Ludlow. Subsidiary Activities The company is a legal entity separate and distinct from its first-tier bank subsidiary, Bar Harbor Bank & Trust, and its second-tier subsidiaries, Bar Harbor Wealth Management and Cottage Street Corporation. Lending Activities Commercial Construction - Loans in this segment primarily include raw land, land development and construction of commercial and multifamily residential properties. Commercial Real Estate Owner Occupied and Non-Owner Occupied - Loans in these segments are primarily owner-occupied or income-producing properties. Loans to Real Estate Investment Trusts (REITs) and unsecured loans to developers that closely correlate to the inherent risk in commercial real estate markets are also included. Tax Exempt - Loans in this segment primarily include loans to various state and municipal government entities. Commercial and Industrial Loans - Loans consist of revolving and term loan obligations extended to business and corporate enterprises for the purpose of financing working capital and/or capital investment in this segment. Generally loans are secured by assets of the business, such as accounts receivable, inventory, marketable securities, other liquid collateral, equipment and other business assets. Some loans in this category may be unsecured or guaranteed by government agencies, such as the SBA. Residential Real Estate - All loans in this segment are collateralized by one-to-four family homes. Home Equity - All loans and lines of credit are made to qualified individuals and are secured by senior or junior mortgage liens on owner-occupied one- to four-family homes, condominiums, or vacation homes. Consumer Other - Loans in this segment include personal lines of credit and amortizing loans made to qualified individuals for various purposes, such as auto loans, recreational equipment, overdraft protection or other consumer loans. Investment Securities Activities For the year ended December 31, 2022, the company’s investment securities included U.S. government-sponsored enterprises; U.S. government agency securities; private label securities; obligations of states and political subdivisions thereof; and corporate bonds. Deposit Activities A variety of deposit products to consumers, businesses and institutional customers with a wide range of interest rates and terms are offered. Deposits consist of interest-bearing and non-interest-bearing demand accounts, savings accounts, money market deposit accounts, and certificates of deposit. Deposits are solicited primarily in the market area, excluding brokered deposits. Other depositor-related fee services provided to customers include ATMs, remote deposit capture, ACH origination, wire transfers, internet bill pay, and other cash management services. Retail Brokerage Services Bar Harbor Financial Services principally serves the brokerage needs of individuals ranging from first-time purchasers, to sophisticated investors. It also offers a line of life insurance, annuity, and retirement products, as well as financial planning services. The bank is a branch office of Infinex Investments, Inc. (Infinex), a full-service third-party broker-dealer, conducting business under the assumed business name ‘Bar Harbor Financial Services’. Infinex is an independent registered broker-dealer and is not affiliated with the company or its subsidiaries. Infinex was formed by a group of member banks, and is one of the largest providers of third-party investment and insurance services to banks and their customers in New England. Through Infinex, the expertise, capabilities, and experience of a well-established third-party broker-dealer is obtained in a cost effective manner. Trust Management Services The bank has one wholly-owned subsidiary that provides a comprehensive array of fiduciary services, including trust and estate administration, wealth advisory services, and investment management services to individuals, businesses, not-for-profit organizations, and municipalities. As a New Hampshire-chartered trust company, Bar Harbor Wealth Management is subject to New Hampshire laws applicable to trust companies and fiduciaries. Professional advisors help individuals and families structure accounts that will meet their long-term financial needs. To many wealth management clients, the effective transfer of wealth to future generations is of paramount importance. The trust services act as a fiduciary for various types of trusts and serves as the investment manager for these accounts. Outside of trust services, they also provide 401(k) plan services, financial, estate and charitable planning, investment management, family office, municipal and tax services. Regulation and Supervision As a bank holding company, the company is regulated under the federal Bank Holding Company Act (‘BHC Act’) and is subject to examination and supervision by the Federal Reserve Board. The Federal Reserve Board requires the company to file various reports and also may conduct an examination of the company. The company is also under the jurisdiction of the Securities and Exchange Commission (‘SEC’) and is subject to the disclosure and regulatory requirements of the Securities Act of 1933, as amended, and the Exchange Act. As a Maine-chartered financial institution, the bank is subject to supervision, regular examination, and regulation by the Maine Bureau of Financial Institutions (‘BFI’) and the Federal Deposit Insurance Corporation (‘FDIC’) as its primary federal regulator and as its deposit insurer. The bank’s deposits are insured by the FDIC in accordance with applicable federal laws and regulations. Bar Harbor Wealth Management, a New Hampshire chartered non-depository trust company and an indirect subsidiary of the bank (‘BHWM’), is subject to supervision, regular examination, and regulation by the New Hampshire Banking Department. The holding company and the bank are considered ‘affiliates’ of each other under the Federal Reserve Act, and transactions between a bank and its affiliates are subject to certain restrictions, under Sections 23A and 23B of the Federal Reserve Act and the Federal Reserve Board’s implementing Regulation W. The bank’s deposit accounts are fully insured by the Deposit Insurance Fund (‘DIF’) of the FDIC up to the deposit insurance limits set forth in applicable law and regulations. The company is subject to a number of federal and state consumer protection laws that govern its relationship with its customers. These laws include, for example, the Equal Credit Opportunity Act, the Fair Credit Reporting Act, the Truth in Lending Act, the Truth in Savings Act, the Electronic Fund Transfer Act, the Expedited Funds Availability Act, the Home Mortgage Disclosure Act, the Fair Housing Act, the Real Estate Settlement Procedures Act, the Fair Debt Collection Practices Act, the Right to Financial Privacy Act, the Service Members Civil Relief Act and these federal laws’ respective state law counterparts, as well as state usury laws and laws regarding unfair and deceptive acts and practices. During its last examination, the bank received a CRA rating of ‘satisfactory’. Section V of the Gramm-Leach-Bliley Act (‘GLBA’) and its implementing regulations require all financial institutions, including the company and the bank and the bank’s subsidiaries, to adopt privacy policies, restrict the sharing of nonpublic customer data with non-affiliated parties at the customer’s request, limit the reuse of certain consumer information received from non-affiliated financial institutions, and establish procedures and practices to protect customer data from unauthorized access. In addition, the Fair Credit Reporting Act (‘FCRA’), as amended by the Fair and Accurate Credit Transactions Act of 2003 (the ‘FACT Act’), includes many provisions affecting the company, the bank, and/or their affiliates, including provisions concerning obtaining consumer reports, furnishing information to consumer reporting agencies, maintaining a program to prevent identity theft, sharing of certain information among affiliated companies, and other provisions. The CFPB and the Federal Trade Commission (‘FTC’) have extensive rulemaking authority under the FACT Act, and the company and the bank are subject to the rules that have been promulgated under the FACT Act, including rules requiring financial institutions with covered accounts (e.g. consumer bank accounts and loans) to develop, implement, and administer an identity theft protection program, as well as rules regarding limitations on affiliate marketing and implementation of programs to identify, detect and mitigate certain identity theft red flags. The company has developed policies and procedures for itself and its subsidiaries, including the bank, and believes it is in compliance with all privacy, information sharing, and notification provisions of the GLBA and the FACT Act. The bank is also subject to data security standards, privacy and data breach notice requirements, primarily those issued by the FDIC, as well as under state laws. The U.S. Treasury Department has issued a number of regulations that apply various requirements of the USA PATRIOT Act of 2001 to financial institutions, such as the bank. History Bar Harbor Bankshares was founded in 1887. The company was incorporated under the laws of the state of Maine in 1984.