CNC Announces 13.3% Increase in EPS

CAMDEN NATIONAL CORPORATION ANNOUNCES A 13.3% INCREASE IN EARNINGS PER SHARE FOR THE FOURTH QUARTER - 1/29/2008

CAMDEN, Maine, January 29, 2008: Robert W. Daigle, president and chief executive officer of Camden National Corporation (NASDAQ: CAC; the "Company"), today announced fourth quarter 2007 earnings per diluted share of $0.85, a $0.10, or 13.3%, increase over the fourth quarter of 2006, and unaudited 2007 earnings per diluted share of $3.09, a $0.16, or 5.5%, increase over 2006.

Net income for 2007 was $20.3 million, which was approximately equal to the net income earned for fiscal year 2006. Net income for the fourth quarter of 2007 was $5.6 million, a 12.5% increase over the $4.9 million reported for the fourth quarter of 2006. For the year ended December 31, 2007, returns on average equity and average assets were 18.34% and 1.16%, respectively, compared to 18.40% and 1.17% for the year ended December 31, 2006.

The Company's total assets at December 31, 2007 were $1.7 billion, a decline of $53.1 million compared to total assets at December 31, 2006. Total loans at December 31, 2007 were $1.1 billion, down $72.5 million compared to total loans at December 31, 2006, while investments increased $19.7 million to $463.8 million at December 31, 2007. As previously disclosed, the decline in loan balances reflects a continued conservative posture in the Company's commercial real estate lending activity due to an environment of increased competition highlighted by relaxed credit structures and low long-term fixed rate commitments, which the Company feels does not provide an adequate reward for the inherent risks. As a result of the more recent credit market turmoil, the Company has observed the market returning to more rational pricing and structuring practices. Total deposits of $1.1 billion at December 31, 2007 declined $67.8 million from the same period a year ago, primarily reflecting the maturity and non-replacement of $85.0 million of brokered certificates of deposit. Core deposits of $1.0 billion (total deposits excluding brokered certificates of deposit) at December 31, 2007 increased $17.3 million over the same period a year ago.

Net interest income for 2007 decreased $4.3 million, or 8.0%, to $49.9 million, compared to $54.2 million for 2006. Net interest income for the fourth quarter of 2007 decreased 2.9% to $12.9 million, compared to $13.3 million for the same period of 2006. The run-off in commercial real estate balances, as well as higher funding costs and a full year of trust preferred interest, lowered the net interest margin, which was 3.09% for 2007 versus 3.36% for 2006.

For the year ended December 31, 2007, the Company provided $100,000 to the allowance for loan and lease losses ("ALLL") compared to $2.2 million for the year ended December 31, 2006. In the fourth quarter of 2007, the Company made no provision to the 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 0.93% at December 31, 2007, compared favorably to 1.12% at December 30, 2006, and an overall decline in outstanding loan balances. The ALLL was 1.19% of total loans outstanding at December 31, 2007, compared to 1.23% of loans outstanding on the same date in 2006.

Non-interest income for 2007 was $12.7 million, an increase of $1.0 million, or 8.8%, over 2006. Non-interest income of $3.2 million for the quarter ended December 31, 2007 was up 10.9% from the same quarter a year ago. The increase in non-interest income was primarily the result of increases 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 2007 was $33.7 million, a decrease of $538,000, or 1.6%, compared to 2006. Non-interest expense for the fourth quarter of 2007 was $8.2 million, a decrease of $348,000, or 4.1%, over the same quarter in the prior year. The decrease in non-interest expense was largely due to declines in professional fees, costs incurred in 2006 to complete the merge of the Company's two banking franchises, and legal settlement expenses incurred in 2006, all partially offset by normal salary and benefit cost increases and investments in technology. The Company's efficiency ratio (non-interest expense/net interest income and non-interest income) for the year ended and quarter ended December 31, 2007 was 53.88% and 50.88%, respectively, compared to 52.00% and 52.80% for the same periods of 2006.

At December 31, 2007, the Company's total risk-based capital ratio of 14.04% and tier 1 capital ratio of 12.82% 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."

As previously announced, during 2007 and early 2008, the Company completed the following noteworthy corporate activities:

- Completed the acquisition of Union Bankshares Company on January 3, 2008;

- Named Karen W. Stanley to the Board of Directors of the Company;

- Transitioned the listing of its common stock to The NASDAQ® Global Market effective January 2, 2008;

- Paid dividends of $0.96 per share during 2007, which represented an increase of 9.1% over the $0.88 per share paid in 2006;

- Repurchased 113,950 shares of common stock under its Stock Repurchase Program; and

- Announced the retirement of Winfield F. Robinson and Theodore C. Johanson from the Company's Board of Directors.

Daigle stated, "With all the turbulence that has been experienced in the financial services sector over these past several months, we are heartened by these results, which support our long-term strategy to build a banking franchise capable of withstanding uncontrollable external forces of change while providing the foundation to be opportunistic when presented with situations that are capable of enhancing shareholder value."

Camden National Corporation, a 2006 Best Places to Work in Maine company headquartered in Camden, Maine, and listed on the NASDAQ®Global Select Market 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 a network of 37 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, Bangor, and Ellsworth. Acadia Financial Consultants is a division of CNB, offering full-service brokerage services.

Forward-Looking Statements

This press release contains statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. 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 Camden. These risks, uncertainties and other factors may cause the actual results, performance or achievements of Camden 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: (i) integration costs following the merger; (ii) changes in general, national or regional economic conditions; (iii) changes in loan default and charge-off rates; (iv) reductions in deposit levels necessitating increased borrowing to fund loans and investments; (v) changes in interest rates; (vi) changes in laws and regulations; (vii) changes in the size and nature of Camden's competition; and (viii) 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 Camden's filings with the SEC, including its 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 Camden 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