CNC Posts 2Q Earnings

CAMDEN NATIONAL CORPORATION ANNOUNCES A 4.3% INCREASE IN FIRST HALF 2007 EARNINGS PER SHARE RESULTS - 7/31/2007

CAMDEN, Maine, July 31, 2007: Robert W. Daigle, president and Chief Executive Officer of Camden National Corporation (AMEX: CAC; the "Company"), today announced year-to-date earnings per diluted share for 2007 of $1.47, a $0.06, or 4.3%, increase over the first six months of 2006, which reflects the favorable impact of the Company's tender offer stock repurchase completed in the second quarter of 2006, as well as recent common stock repurchases. The second quarter 2007 earnings per diluted share was $0.75, which was equal to the $0.75 per diluted share for the second quarter of 2006. For the six months ended June 30, 2007, the returns on average equity and average assets were 17.97% and 1.12%, compared to 17.19% and 1.20%, respectively, for the six months ended June 30, 2006.

Net income for the first half of 2007 was $9.7 million compared to $10.2 million for the first half of 2006, a decline of $471,000, or 4.6%. Net income for the second quarter of 2007 was $4.9 million, a 6.0% decrease from $5.3 million reported for the second quarter of 2006. The decline was primarily due to decreased net interest income, which was adversely impacted by higher funding costs and the full period impact of trust preferred interest expense, partially offset by an increase in non-interest income.

Daigle commented, "The results for the first six months of 2007 are modest by past performance comparison, but represent the fulfillment of strategic objectives that recognize the difficult economic and competitive environment in which we currently find ourselves."

The Company's total assets at June 30, 2007 were $1.8 billion, an increase of $5.4 million over total assets at June 30, 2006. Investments increased $53.3 million to $458.9 million at June 30, 2007, while total loans at June 30, 2007 were $1.2 billion, down $54.5 million compared to total loans at June 30, 2006. The decline in loan balances largely reflects a pullback in construction and commercial real estate lending activity due to the current environment of increased competition and slowing growth resulting in irrational competitive pricing and structuring of these transactions. Total deposits of $1.1 billion at June 30, 2007 declined $104.0 million from the same period a year ago reflecting the maturity and non-replacement of $133.2 million of brokered certificates of deposit. Core deposits of $1.0 billion (total deposits excluding brokered certificates of deposit) at June 30, 2007 increased $29.2 million over the same period a year ago.

Net interest income for the second quarter of 2007 decreased 8.8% to $12.3 million, compared to $13.5 million for same period of 2006. The combination of the flat yield curve and increased money market, certificate of deposit and borrowing interest costs, including a full fiscal quarter of trust preferred interest expense, continued to compress the net interest margin, which was 3.06% for the first six months of 2007 versus 3.48% for the same period of 2006.

During the second quarter of 2007, the Company made no provision to the allowance for loan and lease losses ("ALLL") compared to $552,000 provided for the same quarter of 2006. The decline in the provision to the ALLL was a result of an improvement in non-performing loans as a percentage of total loans, which at 0.56% at June 30, 2007, compared favorably to 0.74% at June 30, 2006, and an overall decline in outstanding loan balances quarter-on-quarter. The ALLL was 1.17% of total loans outstanding at June 30, 2007, compared to 1.23% of loans outstanding on the same date in 2006.

Non-interest income of $3.2 million for the quarter ended June 30, 2007 was up 9.5% from the same quarter a year ago. This was primarily the result of an increase in income from fiduciary services at Acadia Trust, N.A., brokerage and insurance commission income at Acadia Financial Consultants, and growth in debit card activity.

Non-interest expense for the second quarter of 2007 was $8.5 million, an increase of $235,000, or 2.8%, over the same quarter in the prior year due to normal salary increases and increased premises and equipment costs related to the renovation of the Rockland Spear Block, which now houses the Rockland branch, and technology initiatives. The Company's efficiency ratio (non-interest expense/net interest income and non-interest income) for the quarter ended June 30, 2007 was 54.69%, compared to 50.25% for the second quarter of 2006.

At June 30, 2007, the Company's total risk-based capital ratio of 13.00% and tier 1 capital ratio of 11.80% compared favorably to the minimum ratios of 10.0% and 6.0%, respectively, required by the Federal Reserve for a bank holding company to be considered "well capitalized."

The Company reported earlier that the Board of Directors approved a dividend, payable on July 31, 2007 for shareholders of record on July 16, 2007, of $0.24 per share, which is a 9.1% increase over the dividend paid at the same time last year.

"While our Company continues to be challenged by the external forces affecting growth and profitability, we are posting financial results that support our recognition as one of the nation's top-performing mid-tier banks, according to US Banker magazine's annual ranking. This is attributable to a workforce that is committed to innovation while delivering a service experience that is second to none," Daigle noted in concluding his remarks.

Camden National Corporation, a 2006 Best Places to Work in Maine company headquartered in Camden, Maine, and listed on the American Stock Exchange under the symbol CAC, is the holding company for a family of two financial services companies, including: Camden National Bank (CNB), a full-service community bank with 27 banking offices serving coastal, western, central and eastern Maine, and recipient of the Governor's Award for Business Excellence in 2002, and Acadia Trust, N.A., offering investment management and fiduciary services with offices in Portland and Bangor. Acadia Financial Consultants is a division of CNB, offering full-service brokerage services.

This press release and the documents incorporated by reference herein contain certain statements that may be considered forward-looking statements under the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of the words "believe," "expect," "anticipate," "intend," "estimate," "assume," "will," "should," and other expressions which predict or indicate future events or trends and which do not relate to historical matters. Forward-looking statements should not be relied on, because they involve known and unknown risks, uncertainties and other factors, some of which are beyond the control of the Company. These risks, uncertainties and other factors may cause the actual results, performance or achievements of the Company to be materially different from the anticipated future results, performance or achievements expressed or implied by the forward-looking statements.

Some of the factors that might cause these differences include the following: changes in general, national or regional economic conditions; changes in loan default and charge-off rates; reductions in deposit levels necessitating increased borrowing to fund loans and investments; changes in interest rates; changes in laws and regulations; changes in the size and nature of the Company's competition; and changes in the assumptions used in making such forward-looking statements. Other factors could also cause these differences. For more information about these factors please see our Annual Report on Form 10-K on file with the SEC. All of these factors should be carefully reviewed, and readers should not place undue reliance on these forward-looking statements.

These forward-looking statements were based on information, plans and estimates at the date of this press release, and the Company does not promise to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes.

Contact:

Suzanne Brightbill

Public Relations Officer

Camden National Corporation

207.230.2120

sbrightbill@camdennational.com