Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: September 30, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-13349 BAR HARBOR BANKSHARES (Exact name of registrant as specified in its charter) Maine 01-0393663 (State or other ju ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Consolidated Financial Statements (unaudited)](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20(unaudited)) This section presents the unaudited interim consolidated financial statements for Bar Harbor Bankshares as of June 30, 2022, and for the three and six-month periods then ended, including balance sheets, statements of income, comprehensive income, changes in shareholders' equity, cash flows, and detailed notes explaining key accounting policies [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2022, total assets were $3.72 billion, a slight increase from $3.71 billion at December 31, 2021, driven by a $195.4 million increase in net loans, while shareholders' equity decreased significantly to $393.6 million from $424.1 million due to unrealized losses on available-for-sale securities Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2022 | December 31, 2021 | Change | | :--- | :--- | :--- | :--- | | **Total Assets** | **$3,715,757** | **$3,709,233** | **+$6,524** | | Net Loans | $2,703,518 | $2,509,192 | +$194,326 | | Total Deposits | $3,078,545 | $3,048,544 | +$30,001 | | **Total Liabilities** | **$3,322,160** | **$3,285,086** | **+$37,074** | | **Total Shareholders' Equity** | **$393,597** | **$424,147** | **-$30,550** | | Accumulated Other Comprehensive (Loss) Income | ($40,971) | $2,303 | -$43,274 | [Consolidated Statements of Income](index=8&type=section&id=Consolidated%20Statements%20of%20Income) For Q2 2022, net income increased to $10.5 million from $9.0 million in Q2 2021, primarily due to a 16.5% rise in net interest income, with diluted EPS reaching $0.70 Income Statement Summary (in thousands, except per share data) | Metric | Q2 2022 | Q2 2021 | YTD 2022 | YTD 2021 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $26,519 | $22,754 | $50,817 | $46,176 | | Provision for Credit Losses | $534 | ($765) | $911 | ($1,254) | | Non-interest Income | $8,961 | $9,505 | $18,270 | $19,753 | | Non-interest Expense | $21,700 | $21,724 | $43,586 | $44,215 | | **Net Income** | **$10,503** | **$9,025** | **$19,615** | **$18,505** | | **Diluted EPS** | **$0.70** | **$0.60** | **$1.30** | **$1.23** | [Consolidated Statements of Comprehensive Income](index=9&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) The company reported a total comprehensive loss of $9.1 million for Q2 2022 and $23.7 million for the first six months of 2022, primarily driven by significant unrealized losses on available-for-sale securities due to rising interest rates Comprehensive Income (Loss) (in thousands) | Metric | Q2 2022 | Q2 2021 | YTD 2022 | YTD 2021 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $10,503 | $9,025 | $19,615 | $18,505 | | Other Comprehensive (Loss) Income | ($19,616) | $2,819 | ($43,274) | ($858) | | **Total Comprehensive (Loss) Income** | **($9,113)** | **$11,844** | **($23,659)** | **$17,647** | [Consolidated Statements of Changes in Shareholders' Equity](index=10&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity) Shareholders' equity decreased from $424.1 million at year-end 2021 to $393.6 million at June 30, 2022, primarily due to a $43.3 million other comprehensive loss that offset net income and cash dividends - Key drivers for the change in shareholders' equity in the first six months of 2022 include net income of **$19.6 million**, offset by other comprehensive loss of **$43.3 million** and cash dividends of **$7.5 million**[14](index=14&type=chunk)[220](index=220&type=chunk) [Consolidated Statements of Cash Flows](index=12&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2022, net cash provided by operating activities was $19.5 million, while net cash used in investing activities was $224.8 million, resulting in a net decrease in cash and cash equivalents of $183.3 million Cash Flow Summary - Six Months Ended June 30 (in thousands) | Activity | 2022 | 2021 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $19,546 | $12,922 | | Net Cash (Used in) from Investing Activities | ($224,777) | $21,318 | | Net Cash from (Used in) Financing Activities | $21,958 | ($86,529) | | **Net Change in Cash & Cash Equivalents** | **($183,273)** | **($52,289)** | [Notes to Unaudited Consolidated Interim Financial Statements](index=15&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Interim%20Financial%20Statements) This section provides detailed explanations for the figures presented in the primary financial statements, covering securities, loan portfolio, allowance for credit losses, borrowings, deposits, capital adequacy, derivative instruments, and fair value measurements [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=72&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance for Q2 and H1 2022, highlighting strong net income growth driven by net interest margin expansion and robust loan growth, despite the negative impact of unrealized securities losses on equity and book value, while maintaining stable credit quality and strong liquidity - Q2 2022 net income increased **16%** year-over-year to **$10.5 million**, driven by a **17%** rise in net interest income, with the net interest margin expanding by **45 basis points** to **3.19%** due to a higher interest rate environment and strong loan growth[201](index=201&type=chunk)[203](index=203&type=chunk) - Total loans grew at an **11% annualized rate** during Q2 2022, with commercial loans growing at **13%**, funded by core deposit expansion and the use of excess cash[207](index=207&type=chunk) - Shareholders' equity and book value were negatively impacted by unrealized losses on securities, with net unrealized losses of **$49.7 million** at quarter-end, reducing book value per share by **$2.55**[206](index=206&type=chunk)[209](index=209&type=chunk) - Credit quality remains strong, with non-accruing loans decreasing to **$7.9 million** from **$10.2 million** at year-end 2021, and the allowance for credit losses to total loans ratio stable at **0.87%**[208](index=208&type=chunk)[214](index=214&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=94&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risk is interest rate risk, managed by ALCO, with the balance sheet being asset-sensitive as of June 30, 2022, projecting net interest income improvement in a rising rate environment and deterioration in a falling rate environment - The company's most significant market risk is interest rate risk, which is managed by the Asset and Liability Committee (ALCO)[243](index=243&type=chunk)[244](index=244&type=chunk) Net Interest Income Sensitivity Analysis (as of June 30, 2022) | Rate Change (Basis Points) | Change over 1-12 Months | Change over 13-24 Months | | :--- | :--- | :--- | | +200 | +4.1% | +12.3% | | -100 | -3.2% | -8.9% | - Compared to the prior year, the company's sensitivity to a down-rate scenario has increased, while its sensitivity to an up-rate scenario has decreased[254](index=254&type=chunk) [Item 4. Controls and Procedures](index=97&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2022, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation by senior management, the company's disclosure controls and procedures were deemed **effective** as of June 30, 2022[259](index=259&type=chunk) - No changes occurred during the last fiscal quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[260](index=260&type=chunk) [PART II. OTHER INFORMATION](index=97&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=97&type=section&id=Item%201.%20Legal%20Proceedings) The company and its subsidiaries are involved in ordinary routine litigation incidental to their business, which management believes will not have a material effect on the consolidated financial statements - The company is party to routine litigation that is not expected to have a **material impact** on its financial condition[261](index=261&type=chunk) [Item 1A. Risk Factors](index=97&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2021 - No **material changes** to the risk factors from the 2021 Form 10-K were reported[262](index=262&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=98&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) On June 23, 2022, the Board of Directors approved a new twelve-month stock repurchase plan for up to 5% of outstanding common stock, approximately 751,000 shares, with no shares repurchased under this plan during Q2 2022 - A new stock repurchase plan for up to **751,000 shares** was approved in June 2022[263](index=263&type=chunk) - No shares were repurchased during the second quarter of 2022[211](index=211&type=chunk)[264](index=264&type=chunk) [Item 6. Exhibits](index=99&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and the financial statements formatted in iXBRL - Key exhibits filed include certifications by the CEO and CFO as required by Sarbanes-Oxley Act rules[265](index=265&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: March 31, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-13349 BAR HARBOR BANKSHARES (Exact name of registrant as specified in its charter) Maine 01-0393663 (State or other jurisd ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-13349 BAR HARBOR BANKSHARES (Exact name of registrant as specified in its charter) Maine 01-0393663 (State or other jurisdiction of incorporation ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: September 30, 2021 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-13349 BAR HARBOR BANKSHARES (Exact name of registrant as specified in its charter) Maine 01-0393663 (State or other ju ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Consolidated Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20(unaudited)) This section presents the unaudited consolidated financial statements for Q2 2021 and 2020, detailing financial position, performance, and cash flows, along with significant accounting policies [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) The Consolidated Balance Sheets detail the company's financial position, showing a slight decrease in total assets and deposits, while shareholders' equity increased Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Total Assets** | **$3,639,675** | **$3,725,762** | | Net Loans | $2,492,745 | $2,543,803 | | Total Securities | $635,994 | $599,082 | | Goodwill | $119,477 | $119,477 | | **Total Liabilities** | **$3,224,103** | **$3,314,421** | | Total Deposits | $2,822,473 | $2,906,215 | | Total Borrowings | $340,033 | $336,023 | | **Total Shareholders' Equity** | **$415,572** | **$411,341** | [Consolidated Statements of Income](index=8&type=section&id=Consolidated%20Statements%20of%20Income) The income statement shows a year-over-year increase in net income for Q2 and YTD 2021, driven by a negative provision for credit losses and strong non-interest income Key Income Statement Data (in thousands, except EPS) | Metric | Q2 2021 | Q2 2020 | YTD 2021 | YTD 2020 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $22,754 | $24,590 | $46,176 | $49,153 | | Provision for Credit Losses | ($765) | $1,354 | ($1,254) | $2,465 | | Non-interest Income | $9,505 | $9,710 | $19,753 | $18,131 | | Non-interest Expense | $21,724 | $22,266 | $44,215 | $44,625 | | **Net Income** | **$9,025** | **$8,481** | **$18,505** | **$16,202** | | **Diluted EPS** | **$0.60** | **$0.55** | **$1.23** | **$1.04** | [Consolidated Statements of Comprehensive Income](index=9&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) This statement reconciles net income to total comprehensive income, including unrealized gains and losses, showing an increase for Q2 2021 Comprehensive Income Summary (in thousands) | Metric | Q2 2021 | Q2 2020 | YTD 2021 | YTD 2020 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $9,025 | $8,481 | $18,505 | $16,202 | | Total Other Comprehensive Income (Loss) | $4,230 | $2,331 | ($3,322) | $4,610 | | **Total Comprehensive Income** | **$13,255** | **$10,812** | **$15,183** | **$20,812** | [Consolidated Statements of Changes in Shareholders' Equity](index=10&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity) This statement details changes in shareholders' equity, reflecting an increase from year-end 2020 to June 30, 2021, driven by net income, dividends, and other comprehensive income - Total shareholders' equity increased to **$415.6 million** at June 30, 2021, from **$411.3 million** at December 31, 2020[15](index=15&type=chunk)[16](index=16&type=chunk) - The company declared cash dividends of **$0.24 per share** in the second quarter of 2021, an increase from **$0.22 per share** in the prior year[15](index=15&type=chunk) [Consolidated Statements of Cash Flows](index=12&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the first six months of 2021, the company experienced a net decrease in cash and cash equivalents, primarily due to financing activities, partially offset by operating and investing activities Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Category | 2021 | 2020 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $12,922 | $16,116 | | Net Cash from (used in) Investing Activities | $21,318 | ($63,792) | | Net Cash (used in) from Financing Activities | ($86,529) | $61,439 | | **Net Change in Cash** | **($52,289)** | **$13,763** | [Notes to Unaudited Consolidated Interim Financial Statements](index=15&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Interim%20Financial%20Statements) This section provides detailed explanations of accounting policies and financial data, including the impact of CECL adoption and breakdowns of key financial instruments - Effective January 1, 2021, the Company adopted ASU 2016-13 (CECL), which replaced the incurred loss model with a lifetime expected credit loss model[23](index=23&type=chunk)[37](index=37&type=chunk) - The adoption of CECL resulted in a **$5.2 million** increase to the allowance for credit losses on loans and a **$1.6 million** increase to the allowance for unfunded commitments, leading to a cumulative-effect decrease to retained earnings of **$5.2 million**, net of tax[52](index=52&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=87&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management provides a narrative analysis of the company's financial performance and condition, highlighting strong core earnings, improved credit quality, and effective expense management for Q2 2021 - Q2 2021 net income was **$9.0 million** (**$0.60 per share**), a **9% increase** in EPS compared to Q2 2020[243](index=243&type=chunk) - Key highlights for Q2 2021 include **8% annualized commercial loan growth** (excluding PPP), a **14% annualized increase in core deposits**, and a **13% increase in fee income** compared to Q2 2020[244](index=244&type=chunk) - Net interest margin (NIM) was **2.74%**, impacted by excess cash balances and lower PPP fee acceleration[246](index=246&type=chunk)[265](index=265&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=112&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section details the company's exposure to market risk, primarily interest rate risk, managed by ALCO, indicating an asset-sensitive balance sheet - The company's most significant market risk is interest rate risk, which is managed by the Asset and Liability Committee (ALCO)[284](index=284&type=chunk)[285](index=285&type=chunk) Interest Rate Sensitivity Analysis (vs. Base Case) | Scenario | Impact on Net Interest Income (Year 1) | Impact on Net Interest Income (Year 2) | | :--- | :--- | :--- | | +200 bps | +8.5% | +14.4% | | -100 bps | -2.1% | -11.4% | [Item 4. Controls and Procedures](index=115&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2021, with no material changes in internal control over financial reporting - The company's principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective as of June 30, 2021[300](index=300&type=chunk) - No changes in internal control over financial reporting occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control[301](index=301&type=chunk) [PART II. OTHER INFORMATION](index=116&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=116&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in routine litigation, which management believes will not materially affect the consolidated financial statements - The Company reports no material legal proceedings that would significantly impact its financial condition[302](index=302&type=chunk) [Item 1A. Risk Factors](index=116&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the 2020 Annual Report on Form 10-K were reported - No material changes to the risk factors from the 2020 Form 10-K were reported[303](index=303&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=117&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The Board approved a plan to repurchase up to 747,000 shares of common stock, with no repurchases made during Q2 2021 - A stock repurchase plan for up to **747,000 shares** was approved in April 2021, but no shares were repurchased during the second quarter[304](index=304&type=chunk) [Item 5. Other Information](index=117&type=section&id=Item%205.%20Other%20Information) The company executed a separation agreement with its former Executive Vice President, Chief Operating Officer & Chief Risk Officer upon his retirement - A separation agreement was executed with the retiring COO & Chief Risk Officer, which included a separation payment of **$250,000** and continued vesting of existing equity awards[305](index=305&type=chunk) [Item 6. Exhibits](index=118&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO/CFO certifications and a former executive's separation agreement - Exhibits filed with the report include CEO/CFO certifications and the separation agreement for Richard B. Maltz[307](index=307&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: March 31, 2021 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-13349 BAR HARBOR BANKSHARES (Exact name of registrant as specified in its charter) Maine 01-0393663 (State or other jurisd ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-13349 BAR HARBOR BANKSHARES (Exact name of registrant as specified in its charter) Maine 01-0393663 (State or other jurisdiction of incorporation ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: September 30, 2020 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-13349 BAR HARBOR BANKSHARES (Exact name of registrant as specified in its charter) Maine 01-0393663 (State or other ju ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: June 30, 2020 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-13349 BAR HARBOR BANKSHARES (Exact name of registrant as specified in its charter) Maine 01-0393663 (State or other jurisdi ...