Sandy Spring Bancorp Reports Net Income of $7.0 Million for the Second Quarter

Sandy Spring Bancorp Reports Net Income of $7.0 Million for the Second Quarter

OLNEY, Md., July 17, 2014 (GLOBE NEWSWIRE) -- Sandy Spring Bancorp, Inc.,
(Nasdaq:SASR) the parent company of Sandy Spring Bank, today reported net
income for the second quarter of 2014 of $7.0 million ($0.28 per diluted
share) compared to net income of $12.2 million ($0.49 per diluted share) for
the second quarter of 2013 and net income of $10.9 million ($0.43 per diluted
share) for the first quarter of 2014.

For the six-months ended June 30, 2014, net income was $17.9 million ($0.71
per diluted share) compared to net income of $22.7 million ($0.91 per diluted
share) for the same period of the prior year.

"Exclusive of the impact of the litigation expenses incurred during the second
quarter, our pre-tax pre-provision income increased from the prior year. This
core performance was evidenced in a stable margin, controlled expense growth
and continued strength in our wealth management and card based businesses,"
said Daniel J. Schrider, President and Chief Executive Officer.

"Our underlying performance in the second quarter was also driven by the
impact of balanced loan growth and the resulting increase in interest income.
This more than offset the decline in mortgage banking revenues as originations
were lower than prior year levels," said Schrider.

Second Quarter Highlights:

  *Total loans increased 12% compared to the second quarter of 2013 and 3%
    compared to the first quarter of 2014 due to significant loan growth in
    the commercial investor real estate portfolio and due to the retention of
    a greater portion of mortgage originations over the past year.
    
  *The provision for loan and lease losses for the second quarter of 2014 was
    a charge of $0.2 million compared to a credit of $2.9 million for the
    second quarter of 2013 and a credit of $1.0 million for the first quarter
    of 2014. The current quarter's provision reflects the stability in the
    credit quality of the loan portfolio as outstanding loans continued to
    grow from the prior year.
    
  *The net interest margin was 3.48% for the second quarter of 2014, compared
    to 3.51% for the second quarter of 2013 and 3.47% for the first quarter of
    2014. The decline compared to the prior year was the result of declining
    loan yields during the period that exceeded the reduction in rates paid on
    interest-bearing liabilities.
    
  *Non-interest income decreased 4% for the quarter compared to the prior
    year quarter due to the decline in income from mortgage banking caused by
    a significantly lower volume of saleable mortgage loan
    originations.During this same period wealth management income increased
    5%.
    
  *Non-performing loans totaled $41.7 million at June 30, 2014 compared to
    $46.2 million at June 30, 2013 and $38.7 million at March 31, 2014. The
    coverage ratio of the allowance for loan and lease losses to
    non-performing loans was 91% at June 30, 2014 compared to a coverage ratio
    of 84% at June 30, 2013 and 98% at March 31, 2014.
    
  *Litigation expenses of $6.1 million were accrued during the quarter as a
    result of an adverse jury verdict associated with the actions of a former
    employee of CommerceFirst Bank which was acquired in 2012.

Review of Balance Sheet and Credit Quality

Total assets grew 4% to $4.2 billion at June 30, 2014 compared to $4.1 billion
at June 30, 2013.This growth was driven by a 12% increase in the loan
portfolio as total loans and leases ended the period at $2.9 billion.As
previously noted, solid increases occurred in the residential mortgage and
commercial investor real estate portfolios.

Deposits and certain other short-term borrowings that comprise all the funding
sources derived from customers, increased 4% compared to June 30, 2013. An
important performance metric involves checking accounts as they are considered
to be primary drivers of growth in multiple-product banking relationships with
clients.At June 30, 2014, the combined noninterest-bearing and
interest-bearing checking account balances increased 10% compared to the
balances at June 30, 2013.

Tangible common equity totaled $427.1 million at June 30, 2014 compared to
$401.7 million at June 30, 2013, resulting in an increase in the ratio of
tangible common equity to tangible assets to 10.29% at June 30, 2014 from
10.08% at June 30, 2013. This increase in tangible common equity occurred
during the period that dividends per common share were raised from $0.30 per
share to $0.36 per common share, a 20% increase. At June 30, 2014, the Company
had a total risk-based capital ratio of 15.66%, a tier 1 risk-based capital
ratio of 14.48% and a tier 1 leverage ratio of 11.37%.

Non-performing loans totaled $41.7 million at June 30, 2014 compared to $46.2
million at June 30, 2013 and $38.7 million at March 31, 2014. The level of
non-performing loans to total loans decreased to 1.43% at June 30, 2014
compared to 1.77% at June 30, 2013.This improvement in credit quality has
occurred concurrent with the year-over-year 12% growth in the loan portfolio.

Net loan charge-offs totaled $0.2 million for the second quarter of 2014
compared to net recoveries of $0.6 million for the second quarter of 2013 and
net loan recoveries of $0.2 million for the first quarter of 2014. The
allowance for loan and lease losses represented 1.30% of outstanding loans and
leases and 91% of non-performing loans at June 30, 2014 compared to 1.50% of
outstanding loans and leases and 84% of non-performing loans at June 30, 2013.
Non-performing loans includes accruing loans 90 days or more past due and
restructured loans.

Income Statement Review

Net interest income for the second quarter of 2014 increased 4% compared to
the second quarter of 2013. This increase was due to the impact of the growth
in average loans and a reduction in funding costs despite a modest decline in
loan yields.This activity resulted in a net interest margin of 3.48% for the
second quarter of 2014 compared to 3.51% for the second quarter of 2013.

The provision for loan and lease losses was $0.2 million for the second
quarter of 2014 compared to a credit of $2.9 million for the second quarter of
2013 and a credit of $1.0 million for the first quarter of 2014. The current
quarter's provision reflects the stability in the credit quality of the loan
portfolio as outstanding loans continued to grow from the prior year.The
credits to the provision for loan and lease losses in prior quarters reflected
the impact of declining charge-offs and improved credit metrics in the loan
portfolio over the past 12 months that more than offset the effects of the
loan growth during the past year.

Non-interest income decreased 4% to $11.7 million for the second quarter of
2014 compared to $12.2 million for the second quarter of 2013.This decrease
was driven by a reduction in mortgage banking income due primarily to lower
mortgage origination volumes and a decline in client refinancing activity.
This decrease was partially offset by a 5% increase in wealth management
income due to higher assets under management.

Non-interest expenses increased 24% to $34.1 million for the second quarter of
2014 compared to $27.5 million in the second quarter of 2013. The current
quarter included $6.1 million in the previously mentioned litigation
expenses.Exclusive of these costs, non-interest expense would have been $28.0
million, an increase of 2% from the second quarter of 2013.This increase was
driven by increased staffing costs.The non-GAAP efficiency ratio was 61.30%
for the second quarter of 2014 compared to 60.92% for the second quarter of
2013.

Net interest income for the first six months of 2014 increased 3% compared to
the first six months of 2013 due to an increase in average loans and lower
funding costs. The net interest margin decreased to 3.48% for the first six
months of 2014 compared to 3.55% for the first six months of 2013 due largely
to the factors cited previously with respect to the second quarter of 2014.

The provision for loan and lease losses was a credit of $0.8 million for the
first six months of 2014 compared to a credit of $2.8 million for first six
months of 2013. The change in the provision for the period was driven by a
decline in historical losses, a lower level of problem loans and loan
recoveries during the period whose impact more than offset the effect of loan
growth over the same period.

Non-interest income decreased 7% to $22.9 million for the first six months of
2014 compared to $24.6 million for the first six months of 2013.This decrease
was driven primarily by a 68% decrease in income from mortgage banking
activities due to the decline in loan origination volumes. The impact of this
decrease was partially mitigated by increases in wealth management income that
increased 7% due to higher assets under management while insurance agency
commissions increased 9%. Other non-interest income decreased 14% due to a
decline in gains on sales and dispositions of loans compared to the prior year
and last year's inclusion of a non-recurring legal settlement.

Non-interest expenses increased to $61.7 million for the first six months of
2014 compared to $55.3 million in the first six months of 2013 due to the
aforementioned impact of the litigation expenses. Excluding the impact of the
litigation expenses, non-interest expense for the six months ended June 30,
2014 was $55.6 million compared to $55.3 million for the six months ended June
30, 2013.The non-GAAP efficiency ratio was 61.45% for the first six months of
2014 compared to 60.86% for the first six months of 2013.

Conference Call

The Company's management will host a conference call to discuss its second
quarter results today at 2:00 P.M. (ET).A live Web cast of the conference
call is available through the Investor Relations' section of the Sandy Spring
Web site at www.sandyspringbank.com. Participants may call 1-888-317-6016. A
password is not necessary.Visitors to the Web site are advised to log on 10
minutes ahead of the scheduled start of the call.An internet-based replay
will be available at the Web site until 9:00 am (ET) July 31, 2014.A replay
of the teleconference will be available through the same time period by
calling 1-877-344-7529 under conference call number 10048612.

About Sandy Spring Bancorp, Inc.

With $4.2 billion in assets, Sandy Spring Bancorp, Inc. is the holding company
for Sandy Spring Bank and its principal subsidiaries, Sandy Spring Insurance
Corporation and West Financial Services, Inc. Sandy Spring Bancorp is the
largest publicly traded banking company headquartered and operating in
Maryland. Sandy Spring is a community banking organization that focuses its
lending and other services on businesses and consumers in the local market
area. Independent and community-oriented, Sandy Spring Bank was founded in
1868 and offers a broad range of commercial banking, retail banking and trust
services through 46 community offices in Anne Arundel, Carroll, Frederick,
Howard, Montgomery, and Prince George's counties in Maryland, and Arlington,
Fairfax and Loudoun counties in Virginia. Through its subsidiaries, Sandy
Spring Bank also offers a comprehensive menu of insurance and investment
management services. Visit www.sandyspringbank.comfor more information about
Sandy Spring Bank.

Forward-Looking Statements

Sandy Spring Bancorp makes forward-looking statements in this news release and
in the conference call regarding this news release.These forward-looking
statements may include: statements of goals, intentions, earnings
expectations, and other expectations; estimates of risks and of future costs
and benefits; assessments of probable loan and lease losses; assessments of
market risk; and statements of the ability to achieve financial and other
goals.

Forward-looking statements are typically identified by words such as
"believe," "expect," "anticipate," "intend," "outlook," "estimate,"
"forecast," "project" and other similar words and expressions.Forward-looking
statements are subject to numerous assumptions, risks and uncertainties, which
change over time.Forward-looking statements speak only as of the date they
are made.Sandy Spring Bancorp does not assume any duty and does not undertake
to update its forward-looking statements.Because forward-looking statements
are subject to assumptions and uncertainties, actual results or future events
could differ, possibly materially, from those that Sandy Spring Bancorp
anticipated in its forward-looking statements and future results could differ
materially from historical performance.

Sandy Spring Bancorp's forward-looking statements are subject to the following
principal risks and uncertainties: general economic conditions and trends,
either nationally or locally; conditions in the securities markets; changes in
interest rates; changes in deposit flows, and in the demand for deposit, loan,
and investment products and other financial services; changes in real estate
values; changes in the quality or composition of the Company's loan or
investment portfolios; changes in competitive pressures among financial
institutions or from non-financial institutions; the Company's ability to
retain key members of management; changes in legislation, regulations, and
policies; and a variety of other matters which, by their nature, are subject
to significant uncertainties.Sandy Spring Bancorp provides greater detail
regarding some of these factors in its Form 10-K for the year ended December
31, 2013, including in the Risk Factors section of that report, and in its
other SEC reports.Sandy Spring Bancorp's forward-looking statements may also
be subject to other risks and uncertainties, including those that it may
discuss elsewhere in this news release or in its filings with the SEC,
accessible on the SEC's Web site at www.sec.gov.

                                                                    
Sandy Spring Bancorp, Inc. and                                                
Subsidiaries
FINANCIAL
HIGHLIGHTS -                                                         
UNAUDITED
                                                                    
                                                                    
                Three Months Ended             Six Months Ended         
                June 30,                 %      June 30,                 %
(Dollars in
thousands,       2014        2013         Change 2014        2013         Change
except per share
data)
Results of                                                           
Operations:
Net interest     $32,309   $30,932    4%     $63,901   $62,258    3%
income
Provision for
loan and lease   158        (2,876)      (105)  (824)       (2,798)      (71)
losses
Non-interest     11,694     12,215      (4)    22,943     24,634      (7)
income
Non-interest     34,141     27,508      24     61,690     55,331      11
expenses
Income before    9,704      18,515      (48)   25,978     34,359      (24)
income taxes
Net income      6,982      12,162      (43)   17,910     22,720      (21)
                                                                    
Pre-tax
pre-provision    $15,990   $15,639    2      $31,282   $31,561    (1)
income
                                                                    
Return on        0.67%      1.23%             0.87%      1.16%       
average assets
Return on
average common   5.47%      9.98%             7.11%      9.42%       
equity
Net interest     3.48%      3.51%             3.48%      3.55%       
margin
Efficiency ratio 77.59%     63.75%            71.04%     63.68%      
- GAAP basis(1)
Efficiency ratio
- Non-GAAP       61.30%     60.92%            61.45%     60.86%      
basis(1)
                                                                    
Per share data:                                                      
Basic net income $0.28     $0.49      (43)%  $0.72     $0.91      (21)%
Diluted net      $0.28     $0.49      (43)   $0.71     $0.91      (22)
income
Average fully    25,127,036 25,009,092  --    25,126,369 25,006,161  --
diluted shares
Dividends
declared per     $0.18     $0.16      13     $0.36     $0.30      20
share
Book value per   20.63      19.45        6      20.63      19.45        6
share
Tangible book    17.04      16.09        6      17.04      16.09        6
value per share
Outstanding      25,069,700 24,967,558  --    25,069,700 24,967,558  --
shares
                                                                    
Financial
Condition at                                                         
period-end:
Investment       $980,530  $1,102,209 (11)%  $980,530  $1,102,209 (11)%
securities
Loans and leases 2,910,944  2,605,458   12     2,910,944  2,605,458   12
Interest-earning 3,945,643  3,802,682   4      3,945,643  3,802,682   4
assets
Assets           4,234,342  4,072,617   4      4,234,342  4,072,617   4
Deposits         3,038,670  2,926,650   4      3,038,670  2,926,650   4
Interest-bearing 2,698,887  2,678,490   1      2,698,887  2,678,490   1
liabilities
Stockholders'    517,269    485,643     7      517,269    485,643     7
equity
                                                                    
Capital ratios:                                                      
Tier 1           11.37%     11.28%             11.37%     11.28%      
leverage(4)
Tier 1 capital
to risk-weighted 14.48%     14.30%             14.48%     14.30%      
assets(4)
Total regulatory
capital to       15.66%     15.55%             15.66%     15.55%      
risk-weighted
assets(4)
Tangible common
equity to        10.29%     10.08%             10.29%     10.08%      
tangible
assets(2)
Average equity
to average       12.31%     12.35%             12.29%     12.30%      
assets
                                                                    
Credit quality                                                       
ratios:
Allowance for
loan and lease   1.30%      1.50%             1.30%      1.50%       
losses to loans
and leases
Non-performing
loans to total   1.43%      1.77%             1.43%      1.77%       
loans
Non-performing
assets to total  1.03%      1.25%             1.03%      1.25%       
assets
Allowance for
loan and lease
losses to        90.99%     84.46%            90.99%     84.46%      
non-performing
loans
Annualized net
charge-offs to   0.03%      (0.10)%           --%       0.09%       
average loans
and leases(3)
                                                                    
(1) The efficiency ratio - GAAP basis is non-interest expenses divided by net
interest income plus non-interest income from the Condensed Consolidated
Statements of Income. The traditional efficiency ratio - non-GAAP basis excludes
intangible asset amortization from non-interest expense; securities gains
(losses) from non-interest income; OTTI; and the tax-equivalent adjustment to
net interest income.See the Reconciliation Table included with these Financial
Highlights.
(2) The tangible common equity to tangible assets ratio is a non-GAAP ratio
that divides assets excluding intangible assets into stockholders' equity after
deducting intangible assets and other comprehensive gains (losses).See the
Reconciliation Table included with these Financial Highlights.
(3) Calculation utilizes average loans and leases, excluding residential  
mortgage loans held-for-sale.
(4) Estimated ratio at June 30, 2014                                      

                                                          
                                                          
Sandy Spring Bancorp, Inc. and Subsidiaries                               
RECONCILIATION TABLE -                                     
UNAUDITED
                                                          
                      Three Months Ended        Six Months Ended
                      June 30,                  June 30,
(Dollars in thousands) 2014         2013         2014         2013
Pre-tax pre-provision                                      
income:
Net income             $6,982     $12,162    $17,910    $22,720
Plus non-GAAP                                              
adjustment:
Litigation expenses    6,128       --         6,128       --
Income taxes           2,722       6,353       8,068       11,639
Provision (credit) for 158         (2,876)     (824)       (2,798)
loan and lease losses
Pre-tax pre-provision  $15,990    $15,639    $31,282    $31,561
income
                                                          
Efficiency ratio -                                         
GAAP basis:
Non-interest expenses $34,141    $27,508    $61,690    $55,331
                                                          
Net interest income
plus non-interest      $44,003    $43,147    $86,844    $86,892
income
                                                          
Efficiency ratio -     77.59%       63.75%       71.04%       63.68%
GAAP basis
                                                          
                                                          
Efficiency ratio -                                         
Non-GAAP basis:
Non-interest expenses $34,141    $27,508    $61,690    $55,331
Less non-GAAP                                              
adjustment:
Amortization of        224         461         594         922
intangible assets
Litigation expenses    6,128       --          6,128       --
Non-interest expenses  $27,789    $27,047    $54,968    $54,409
--as adjusted
                                                          
Net interest income
plus non-interest      $44,003    $43,147    $86,844    $86,892
income
Plus non-GAAP                                              
adjustment:
Tax-equivalent income  1,331       1,312       2,613       2,623
Less non-GAAP                                              
adjustments:
Securities gains       --          62          --          118
Net interest income
plus non-interest      $45,334    $44,397    $89,457    $89,397
income - as adjusted
                                                          
Efficiency ratio -     61.30%       60.92%       61.45%       60.86%
Non-GAAP basis
                                                          
Tangible common equity                                     
ratio:
Total stockholders'    $517,269   $485,643   $517,269   $485,643
equity
Accumulated other
comprehensive (income) (5,233)     2,425       (5,233)     2,425
loss
Goodwill               (84,171)    (84,171)    (84,171)    (84,171)
Other intangible       (737)       (2,241)     (737)       (2,241)
assets, net
Tangible common equity $427,128   $401,656   $427,128   $401,656
                                                          
Total assets           $ 4,234,342 $4,072,617 $ 4,234,342 $4,072,617
Goodwill               (84,171)    (84,171)    (84,171)    (84,171)
Other intangible       (737)       (2,241)     (737)       (2,241)
assets, net
Tangible assets        $ 4,149,434 $3,986,205 $ 4,149,434 $3,986,205
                                                          
Tangible common equity 10.29%       10.08%       10.29%       10.08%
ratio
                                                          
Outstanding common     25,069,700  24,967,558  25,069,700  24,967,558
shares
Tangible book value    $17.04     $16.09     $17.04     $16.09
per common share

                                                             
                                                             
Sandy Spring Bancorp, Inc. and Subsidiaries                                
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION-                           
UNAUDITED
                                                             
                                     June 30,     December 31, June 30,
(Dollars in thousands)                2014         2013         2013
Assets                                                        
Cash and due from banks               $65,674    $46,755    $41,525
Federal funds sold                    474         475         475
Interest-bearing deposits with banks  44,653      27,197      65,507
Cash and cash equivalents             110,801     74,427      107,507
Residential mortgage loans held for   9,042       8,365       29,033
sale (at fair value)
Investments available-for-sale (at    720,885     751,284     838,440
fair value)
Investments held-to-maturity -- fair
value of $224,313, $216,007 and                               
220,838 at June 30, 2014,
December 31, 2013 and June 30, 2013,  223,518     224,638     226,457
respectively
Other equity securities               36,127      40,687      37,312
Total loans and leases                2,910,944   2,784,266   2,605,458
Less: allowance for loan and lease    (37,959)    (38,766)    (39,015)
losses
Net loans and leases                  2,872,985   2,745,500   2,566,443
Premises and equipment, net           45,296      45,916      46,901
Other real estate owned               1,967       1,338       4,831
Accrued interest receivable           12,271      12,532      13,071
Goodwill                              84,171      84,171      84,171
Other intangible assets, net         737         1,330       2,241
Other assets                          116,542     115,912     116,210
Total assets                          $4,234,342 $4,106,100 $4,072,617
                                                             
Liabilities                                                   
Noninterest-bearing deposits          $984,700   $836,198   $877,891
Interest-bearing deposits             2,053,970   2,041,027   2,048,759
Total deposits                        3,038,670   2,877,225   2,926,650
Securities sold under retail
repurchase agreements and federal     72,917      53,842      54,731
funds purchased
Advances from FHLB                    537,000     615,000     540,000
Subordinated debentures               35,000      35,000      35,000
Accrued interest payable and other    33,486      25,670      30,593
liabilities
Total liabilities                     3,717,073   3,606,737   3,586,974
                                                             
Stockholders' Equity                                          
Common stock -- par value $1.00;
shares authorized 50,000,000; shares                          
issued and outstanding 25,069,700,
24,990,021 and 24,967,558 at June 30,
2014, December 31, 2013 and June 30,  25,070      24,990      24,968
2013, respectively
Additional paid in capital            194,252     193,445     192,327
Retained earnings                     292,714     283,898     270,773
Accumulated other comprehensive       5,233       (2,970)     (2,425)
income (loss)
Total stockholders' equity            517,269     499,363     485,643
Total liabilities and stockholders'   $4,234,342 $4,106,100 $4,072,617
equity

                                                             
                                                             
Sandy Spring Bancorp, Inc. and Subsidiaries                               
CONDENSED CONSOLIDATED STATEMENTS OF INCOME -                             
UNAUDITED
                                                             
                                  Three Months Ended  Six Months Ended
                                  June 30,            June 30,
(Dollars in thousands, except per  2014      2013      2014      2013
share data)
Interest Income:                                              
Interest and fees on loans and     $30,706 $29,212 $60,440 $58,858
leases
Interest on loans held for sale    71       309      130      662
Interest on deposits with banks    22       24       42       43
Interest and dividends on                                     
investment securities:
Taxable                            3,876    3,919    7,992    7,853
Exempt from federal income taxes   2,316    2,315    4,637    4,642
Total interest income              36,991   35,779   73,241   72,058
Interest Expense:                                             
Interest on deposits               1,193    1,396    2,377    2,851
Interest on retail repurchase
agreements and federal funds       37       38       75       87
purchased
Interest on advances from FHLB     3,233    3,189    6,451    6,412
Interest on subordinated debt      219      224      437      450
Total interest expense             4,682    4,847    9,340    9,800
Net interest income                32,309   30,932   63,901   62,258
Provision (credit) for loan and    158      (2,876)  (824)    (2,798)
lease losses
Net interest income after
provision (credit) for loan and    32,151   33,808   64,725   65,056
lease losses
Non-interest Income:                                          
Investment securities gains       --       62       --       118
Service charges on deposit        2,089    2,150    4,061    4,219
accounts
Mortgage banking activities       570      1,237    886      2,764
Wealth management income          4,741    4,532    9,207    8,574
Insurance agency commissions      961      1,036    2,601    2,385
Income from bank owned life       608      623      1,206    1,235
insurance
Bank card fees                    1,169    1,079    2,147    2,036
Other income                      1,556    1,496    2,835    3,303
Total non-interest income          11,694   12,215   22,943   24,634
Non-interest Expenses:                                        
Salaries and employee benefits    16,474   16,163   32,829   32,509
Occupancy expense of premises     3,274    2,996    6,746    6,178
Equipment expenses                1,262    1,227    2,518    2,476
Marketing                         802      755      1,344    1,270
Outside data services             1,216    1,114    2,432    2,266
FDIC insurance                    573      581      1,093    1,177
Amortization of intangible assets 224      461      594      922
Litigation expenses               6,128    --       6,128    --
Other expenses                    4,188    4,211    8,006    8,533
Total non-interest expenses        34,141   27,508   61,690   55,331
Income before income taxes         9,704    18,515   25,978   34,359
Income tax expense                 2,722    6,353    8,068    11,639
Net income                         $6,982  $12,162 $17,910 $22,720
                                                             
Net Income Per Share Amounts:                                 
Basic net income per share         $0.28   $0.49   $0.72   $0.91
Diluted net income per share       $0.28   $0.49   $0.71   $0.91
Dividends declared per share       $0.18   $0.16   $0.36   $0.30

                                                                
                                                                
Sandy Spring Bancorp, Inc. and Subsidiaries                                       
HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED                          
                                                                
              2014                  2013
(Dollars in
thousands,     Q2         Q1         Q4         Q3         Q2         Q1
except per
share data)
Profitability
for the                                                          
quarter:
Tax-equivalent
interest       $38,322  $37,532  $38,434  $41,524  $37,091  $37,590
income
Interest       4,682     4,658     4,759     4,874     4,847     4,953
expense
Tax-equivalent
net interest   33,640    32,874    33,675    36,650    32,244    32,637
income
Tax-equivalent 1,331     1,282     1,325     1,344     1,312     1,311
adjustment
Provision for
loan and lease 158       (982)     586       1,128     (2,876)   78
losses
Non-interest   11,694    11,249    11,654    11,223    12,215    12,419
income
Non-interest   34,141    27,549    29,300    26,893    27,508    27,823
expenses
Income before  9,704     16,274    14,118    18,508    18,515    15,844
income taxes
Income tax     2,722     5,346     4,505     6,419     6,353     5,286
expense
Net income    $6,982   $10,928  $9,613   $12,089  $12,162  $10,558
Financial                                                        
performance:
Pre-tax
pre-provision  $15,990  $15,292  $14,704  $19,636  $15,639  $15,922
income
Return on      0.67%      1.08%      0.93%      1.19%      1.23%      1.08%
average assets
Return on
average common 5.47%      8.80%      7.71%      9.91%      9.98%      8.85%
equity
Net interest   3.48%      3.47%      3.53%      3.88%      3.51%      3.59%
margin
Efficiency
ratio - GAAP   77.59%     64.31%     66.59%     57.80%     63.75%     63.60%
basis (1)
Efficiency
ratio -        61.30%     61.60%     63.62%     55.21%     60.92%     60.80%
Non-GAAP basis
(1)
Per share                                                        
data:
Basic net
income per     $0.28    $0.44    $0.38    $0.48    $0.49    $0.42
share
Diluted net
income per     $0.28    $0.43    $0.38    $0.48    $0.49    $0.42
share
Average fully  25,127,036 25,124,206 25,108,109 25,070,506 25,009,092 25,002,612
diluted shares
Dividends
declared per   $0.18    $0.18    $0.18    $0.16    $0.16    $0.14
common share
Non-interest                                                     
income:
Securities     $--      $--      $(3)     $--      $62      $56
gains (losses)
Service
charges on     2,089     1,972     2,143     2,171     2,150     2,069
deposit
accounts
Mortgage
banking        570       316       356       (26)      1,237     1,527
activities
Wealth
management     4,741     4,466     4,508     4,503     4,532     4,042
income
Insurance
agency         961       1,640     1,243     1,193     1,036     1,349
commissions
Income from
bank owned     608       598       635       629       623       612
life insurance
Bank card fees 1,169     978       1,052     1,077     1,079     957
Other income   1,556     1,279     1,720     1,676     1,496     1,807
Total
non-interest   $11,694  $11,249  $11,654  $11,223  $12,215  $12,419
income
Non-interest                                                     
expense:
Salaries and
employee       $16,474  $16,355  $16,707  $16,382  $16,163  $16,346
benefits
Occupancy
expense of     3,274     3,472     3,844     3,149     2,996     3,182
premises
Equipment      1,262     1,256     1,264     1,200     1,227     1,249
expenses
Marketing      802       542       897       713       755       515
Outside data   1,216     1,216     1,162     1,152     1,114     1,152
services
FDIC insurance 573       520       445       678       581       596
Amortization
of intangible  224       370       461       462       461       461
assets
Litigation     6,128     --        --        --        --       --
expenses
Professional   1,292     914       1,386     511       1,332      1,250
fees
Other real
estate owned   9         --        91        (150)     (281)      37
expenses
Other expenses 2,887     2,904     3,043     2,796     3,160      3,035
Total
non-interest   $34,141  $27,549  $29,300  $26,893  $27,508  $27,823
expense
                                                                
(1) The efficiency ratio - GAAP basis is non-interest expenses divided by net
interest income plus non-interest income from the Condensed Consolidated
Statements of Income. The traditional, efficiency ratio - non-GAAP basis
excludes intangible asset amortization from non-interest expense; excludes
securities gains; OTTI losses from non-interest income; and adds the
tax-equivalent adjustment to net interest income.See the Reconciliation Table
included with these Financial Highlights.

                                                                            
Sandy Spring Bancorp, Inc. and Subsidiaries                                  
HISTORICAL TRENDS - QUARTERLY FINANCIAL                                      
DATA - UNAUDITED
                                                                          
                   2014                    2013
(Dollars in         Q2          Q1          Q4          Q3          Q2          Q1
thousands)
Balance sheets at                                                          
quarter end:
Residential         $668,536  $640,939  $618,381  $595,180  $565,282  $538,346
mortgage loans
Residential         149,321     143,109     129,177     118,316     116,736     122,698
construction loans
Commercial ADC      178,972     163,343     160,696     158,739     163,309     150,599
loans
Commercial investor 577,813     573,634     552,178     518,029     497,365     487,802
real estate loans
Commercial owner
occupied real       581,795     582,472     592,823     569,350     563,258     565,820
estate loans
Commercial business 357,472     348,180     356,651     332,670     334,979     344,489
loans
Leasing             260         439         703         962         1,415       1,974
Consumer loans      396,775     380,697     373,657     368,764     363,114     353,341
Total loans and     2,910,944   2,832,813   2,784,266   2,662,010   2,605,458   2,565,069
leases
Allowance for loan  (37,959)    (38,026)    (38,766)    (39,422)    (39,015)    (41,246)
and lease losses
Investment          980,530     997,584     1,016,609   1,077,951   1,102,209   1,008,693
securities
Interest-earning    3,945,643   3,891,223   3,836,912   3,771,825   3,802,682   3,660,809
assets
Total assets        4,234,342   4,168,998   4,106,100   4,052,969   4,072,617   3,932,026
Noninterest-bearing 984,700     882,169     836,198     890,319     877,891     832,679
demand deposits
Total deposits      3,038,670   2,959,195   2,877,225   2,916,466   2,926,650   2,919,208
Customer repurchase 72,917      67,038      53,842      53,177      54,731      50,302
agreements
Total
interest-bearing    2,698,887   2,748,064   2,744,869   2,634,324   2,678,490   2,576,831
liabilities
Total stockholders' 517,269     510,386     499,363     493,882     485,643     488,947
equity
Quarterly average                                                          
balance sheets:
Residential         $659,172  $633,160  $614,698  $593,335  $579,899  $575,889
mortgage loans
Residential         145,968    134,261    125,744    120,676    119,197    120,283
construction loans
Commercial ADC      168,063    162,544    156,558    158,557    160,483    148,749
loans
Commercial investor 575,283    557,168    522,085    499,896    485,630    474,062
real estate loans
Commercial owner
occupied real       579,953    584,155    580,808    566,366    561,249    567,723
estate loans
Commercial business 348,597    349,734    357,455    331,374    337,843    347,569
loans
Leasing             352        567        817        1,152      1,644      2,510
Consumer loans      390,076    377,822    373,017    366,562    360,842    357,366
Total loans and     2,867,464  2,799,411  2,731,182  2,637,918  2,606,787  2,594,151
leases
Investment          991,135     1,012,701   1,055,432   1,097,643   1,047,726   1,051,769
securities
Interest-earning    3,893,843   3,845,513   3,817,033   3,770,855   3,692,215   3,677,444
assets
Total assets        4,157,559   4,105,225   4,082,839   4,039,069   3,959,907   3,946,578
Noninterest-bearing 899,287     825,968     872,532     862,046     838,502     797,926
demand deposits
Total deposits      2,965,329   2,876,641   2,901,814   2,903,926   2,892,704   2,860,451
Customer repurchase 68,880     62,864     57,682     56,766     55,941     52,622
agreements
Total
interest-bearing    2,716,537   2,749,459   2,679,812   2,659,406   2,599,704   2,631,198
liabilities
Total stockholders' 511,738     503,851     494,779     483,811     489,014     483,664
equity
Financial Measures                                                         
Average equity to   12.31%      12.27%      12.12%      11.98%      12.35%      12.26%
average assets
Investment
securities to       24.85%      25.64%      26.50%      28.58%      28.99%      27.55%
earning assets
Loans to earning    73.78%      72.80%      72.57%      70.58%      68.52%      70.07%
assets
Loans to assets     68.75%      67.95%      67.81%      65.68%      63.98%      65.24%
Loans to deposits   95.80%      95.73%      96.77%      91.28%      89.03%      87.87%
Capital measures:                                                          
Tier 1 leverage(1) 11.37%      11.43%      11.32%      11.29%      11.28%      11.07%
Tier 1 capital to
risk-weighted       14.48%      14.64%      14.42%      14.45%      14.30%      14.23%
assets(1)
Total regulatory
capital to          15.66%      15.85%      15.65%      15.70%      15.55%      15.48%
risk-weighted
assets(1)
Book value per      $20.63    $20.38    $19.98    $19.77    $19.45    $19.59
share
Outstanding shares  25,069,700 25,043,482 24,990,021 24,985,146 24,967,558 24,954,892
(1) Estimated ratio                                                        
at June 30, 2014

                                                                 
                                                                 
Sandy Spring Bancorp, Inc. and                                    
Subsidiaries
LOAN PORTFOLIO QUALITY DETAIL -                                   
UNAUDITED
                                                               
                 2014                2013
(Dollars in       June 30, March 31, December  September  June 30, March 31,
thousands)                            31,       30,
Non-Performing                                                  
Assets:
Loans and leases                                                
90 days past due:
Commercial        $1      $--     $--     $--      $15     $--
business
Commercial real                                                 
estate:
Commercial AD&C   --       --       --       --        --       --
Commercial
investor real     --       --       --       --        --       --
estate
Commercial owner
occupied real     --       --       --       --        --       --
estate
Leasing           --       --       --       --        --       --
Consumer          3        --       1        10        --       54
Residential real                                                
estate:
Residential       --       --       --       --        --       --
mortgage
Residential       --       --       --       --        --       --
construction
Total loans and
leases 90 days    4        --       1        10        15       54
past due
Non-accrual loans                                               
and leases:
Commercial        4,309    3,272    3,400    4,050     4,483    4,012
business
Commercial real                                                 
estate:
Commercial AD&C   3,739    4,133    4,127    5,086     5,885    5,826
Commercial
investor real     6,731    7,284    6,802    6,877     11,741   12,353
estate
Commercial owner
occupied real     10,868   7,150    5,936    4,202     5,413    5,346
estate
Leasing           --       --       --       --        --       --
Consumer          2,058    2,115    2,259    2,004     2,305    2,388
Residential real                                                
estate:
Residential       4,501    5,025    5,735    5,643     5,581    5,393
mortgage
Residential       2,143    2,304    2,315    2,327     2,558    3,258
construction
Total non-accrual 34,349   31,283   30,574   30,189    37,966   38,576
loans and leases
Total
restructured      7,364    7,411    9,459    8,054     8,213    10,839
loans - accruing
Total
non-performing    41,717   38,694   40,034   38,253    46,194   49,469
loans and leases
Other assets and
real estate owned 1,967    1,619    1,338    1,662     4,831    5,250
(OREO)
Total
non-performing    $43,684 $40,313 $41,372 $39,915  $51,025 $54,719
assets
                                                               
                 For the quarter ended,
                 June 30,  March 31, December September June 30,  March 31,
                                      31,      30,
(Dollars in       2014      2014      2013      2013       2013      2013
thousands)
Analysis of
Non-accrual Loan                                                
and Lease
Activity:
Balance at
beginning of      $31,283 $30,574 $30,189 $37,966  $38,576 $47,548
period
Non-accrual
balances          (390)    (281)    (365)    (723)     (1,426)  (92)
transferred to
OREO
Non-accrual
balances          (357)    (513)    (922)    (4,995)   (668)    (2,175)
charged-off
Net payments or   (1,580)  (1,073)  (971)    (13,547)  (3,560)  (11,768)
draws
Loans placed on   5,393    2,576    3,546    11,488    5,044    5,493
non-accrual
Non-accrual loans --       --       (903)    --        --       (430)
brought current
Balance at end of $34,349 $31,283 $30,574 $30,189  $37,966 $38,576
period
                                                               
Analysis of
Allowance for                                                   
Loan Losses:
Balance at
beginning of      $38,026 $38,766 $39,422 $39,015  $41,246 $42,957
period
Provision
(credit) for loan 158      (982)    586      1,128     (2,876)  78
and lease losses
Less loans
charged-off, net                                                
of recoveries:
Commercial        28       (768)    384      1         (32)     1,744
business
Commercial real                                                 
estate:
Commercial AD&C   --       --       85       (616)     (1,444)  (1,020)
Commercial
investor real     (23)     (5)      23       1,243     123      31
estate
Commercial owner
occupied real     265      --       (82)     (284)     100      81
estate
Leasing           --       --       --       (6)       (4)      --
Consumer          11       331      488      169       490      508
Residential real                                                
estate:
Residential       (27)     203      347      216       22       447
mortgage
Residential       (29)     (3)      (3)      (2)       100      (2)
construction
Net charge-offs   225      (242)    1,242    721       (645)    1,789
Balance at end of $37,959 $38,026 $38,766 $39,422  $39,015 $41,246
period
                                                               
Asset Quality                                                   
Ratios:
Non-performing
loans to total    1.43%     1.37%     1.44%     1.44%      1.77%     1.93%
loans
Non-performing
assets to total   1.03%     0.97%     1.01%     0.98%      1.25%     1.39%
assets
Allowance for
loan losses to    1.30%     1.34%     1.39%     1.48%      1.50%     1.61%
loans
Allowance for
loan losses to    90.99%    98.27%    96.83%    103.06%    84.46%    83.38%
non-performing
loans
Net charge-offs
in quarter to     0.03%     (0.04)%   0.18%     0.11%      (0.10)%   0.28%
average loans



Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED
                                                                      
                   Three Months Ended June 30,
                   2014                               2013
                                        Annualized                    Annualized
                   Average      (1)     Average     Average    (1)     Average
(Dollars in
thousands and       Balances     Interest  Yield/Rate  Balances   Interest  Yield/Rate
tax-equivalent)
Assets                                                                 
Residential         $659,172   $5,685  3.45%       $579,899 $5,310  3.68%
mortgage loans (2)
Residential         145,968      1,359     3.73        119,197    1,032     3.47
construction loans
Commercial ADC      168,063      2,180     5.20        160,483    2,106     5.26
loans
Commercial investor 575,283      7,139     4.98        485,630    6,184     5.11
real estate loans
Commercial owner
occupied real       579,953      7,146     5.09        561,249    7,302     5.34
estate loans
Commercial business 348,597      4,054     4.69        337,843    4,456     5.15
loans
Leasing             352          6         6.30        1,644      30        7.22
Consumer loans      390,076      3,208     3.32        360,842    3,101     3.47
Total loans and     2,867,464    30,777    4.34        2,606,787  29,521    4.57
leases (3)
Taxable securities  688,793      4,263     2.48        746,266    4,289     2.30
Tax-exempt          302,342      3,260     4.32        301,460    3,257     4.32
securities (4)
Interest-bearing    34,770       22        0.25        37,227     24        0.25
deposits with banks
Federal funds sold  474          --       0.22        475        --       0.22
Total
interest-earning    3,893,843    38,322    3.97        3,692,215  37,091    4.03
assets
                                                                      
Less:allowance for
loan and lease      (38,342)                         (41,605)            
losses
Cash and due from   44,987                           45,603              
banks
Premises and        45,696                           47,501              
equipment, net
Other assets        211,375                          216,193             
Total assets        $4,157,559                     $                  
                                                       3,959,907
                                                                      
Liabilities and
Stockholders'                                                          
Equity
Interest-bearing    $477,018   102      0.09%       $442,808 91       0.08%
demand deposits
Regular savings     262,078      49       0.07        240,410    58       0.10
deposits
Money market        865,134      273       0.13        875,282    378       0.17
savings deposits
Time deposits       461,812      769       0.67        495,702    869       0.70
Total
interest-bearing    2,066,042    1,193     0.23        2,054,202  1,396     0.27
deposits
Other borrowings    68,880       37        0.22        56,711     38        0.27
Advances from FHLB  546,615      3,233     2.37        453,791    3,189     2.82
Subordinated        35,000       219       2.50        35,000     224       2.56
debentures
Total
interest-bearing    2,716,537    4,682     0.69        2,599,704  4,847     0.75
liabilities
                                                                      
Noninterest-bearing 899,287                          838,502             
demand deposits
Other liabilities   29,997                           32,687              
Stockholders'       511,738                          489,014             
equity
Total liabilities                                      $
and stockholders'   $4,157,559                     3,959,907           
equity
                                                                      
Net interest income             $33,640 3.28%                 $32,244 3.28%
and spread
Less:
tax-equivalent                  1,331                         1,312    
adjustment
Net interest income             $32,309                      $30,932 
                                                                      
Interest
income/earning                           3.97%                          4.03%
assets
Interest
expense/earning                          0.49                           0.52
assets
Net interest margin                      3.48%                          3.51%
                                                                      

(1) Tax-equivalent income has been adjusted using the combined marginal federal and
state rate of 39.88% for 2014 and2013. The annualized taxable-equivalent adjustments
utilized in the above table to compute yields aggregated to $1.3 million and $1.3
million in 2014 and 2013, respectively.
(2) Includes residential mortgage loans held for sale. Home equity loans and lines are
classified as consumer loans.
(3) Non-accrual loans are included in the average balances.
(4) Includes only investments that are exempt from federal taxes.



Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED
                                                                    
                   Six Months Ended June 30,
                   2014                             2013
                                      Annualized                    Annualized
                   Average    (1)     Average     Average    (1)     Average
(Dollars in
thousands and       Balances   Interest  Yield/Rate  Balances   Interest  Yield/Rate
tax-equivalent)
Assets                                                               
Residential         $646,238 $11,191 3.46%       $577,905 $10,686 3.70%
mortgage loans (2)
Residential         140,147    2,612     3.76        119,737    2,036     3.43
construction loans
Commercial ADC      165,319    4,253     5.19        154,648    4,102     5.35
loans
Commercial investor 566,275    13,872    4.94        479,878    12,319    5.18
real estate loans
Commercial owner
occupied real       582,042    14,213    5.08        564,468    15,103    5.53
estate loans
Commercial business 349,162    8,091     4.67        342,679    9,042     5.18
loans
Leasing             459        12        5.22        2,075      68        6.53
Consumer loans      383,983    6,326     3.34        359,114    6,164     3.49
Total loans and     2,833,625  60,570    4.34        2,600,504  59,520    4.64
leases (3)
Taxable securities  699,460    8,715     2.49        750,167    8,594     2.29
Tax-exempt          302,398    6,527     4.32        299,569    6,524     4.36
securities (4)
Interest-bearing    33,853     42        0.25        34,156     43        0.25
deposits with banks
Federal funds sold  475        --       0.22        475        --       0.22
Total
interest-earning    3,869,811  75,854    3.96        3,684,871  74,681    4.08
assets
                                                                    
Less:allowance for
loan and lease      (38,864)                       (42,650)            
losses
Cash and due from   45,268                         46,242              
banks
Premises and        45,787                         47,832              
equipment, net
Other assets        209,535                        216,984             
Total assets        $                             $                  
                    4,131,537                        3,953,279
                                                                    
Liabilities and
Stockholders'                                                        
Equity
Interest-bearing    $468,677 194      0.08%       $433,200 183      0.09%
demand deposits
Regular savings     255,667    97       0.08        237,467    106      0.09
deposits
Money market        871,464    546       0.13        883,765    789       0.18
savings deposits
Time deposits       462,591    1,540     0.67        503,908    1,773     0.71
Total
interest-bearing    2,058,399  2,377     0.23        2,058,340  2,851     0.28
deposits
Other borrowings    65,889     75        0.23        61,132     87        0.29
Advances from FHLB  573,619    6,451     2.27        460,892    6,412     2.81
Subordinated        35,000     437       2.50        35,000     450       2.57
debentures
Total
interest-bearing    2,732,907  9,340     0.69        2,615,364  9,800     0.76
liabilities
                                                                    
Noninterest-bearing 862,830                        818,326             
demand deposits
Other liabilities   27,984                         33,235              
Stockholders'       507,816                        486,354             
equity
Total liabilities   $                               $
and stockholders'   4,131,537                      3,953,279           
equity
                                                                    
Net interest income           $66,514 3.27%                 $64,881 3.32%
and spread
Less:
tax-equivalent                2,613                         2,623    
adjustment
Net interest income           $63,901                      $62,258 
                                                                    
Interest
income/earning                         3.96%                          4.08%
assets
Interest
expense/earning                        0.48                           0.53
assets
Net interest margin                    3.48%                          3.55%
                                                                    
(1) Tax-equivalent income has been adjusted using the combined marginal federal and
state rate of 39.88% for 2014 and2013. The annualized taxable-equivalent adjustments
utilized in the above table to compute yields aggregated to $2.6 million and $2.6
million in 2014 and 2013, respectively.
(2) Includes residential mortgage loans held for sale. Home equity loans and lines are
classified as consumer loans.
(3) Non-accrual loans are included in the average balances.
(4) Includes only investments that are exempt from federal taxes.

CONTACT: Daniel J. Schrider, President
         & Chief Executive Officer, or
         Philip J. Mantua, E.V.P.
         & Chief Financial Officer
         Sandy Spring Bancorp
         17801 Georgia Avenue
         Olney, Maryland 20832
         1-800-399-5919
         Email: DSchrider@sandyspringbank.com
         PMantua@sandyspringbank.com
         Web site: www.sandyspringbank.com

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