Frederick County Bancorp, Inc. Reports Results for the Second Quarter 2019

Frederick County Bancorp, Inc. (the "Company") (OTCPink Marketplace: FCBI), the parent company for Frederick County Bank ("FCB"), announced today that, for the quarter ended June 30, 2019, the Company recorded net income of $385 thousand and diluted earnings per share of $0.24, as compared to net income of $864 thousand and diluted earnings per share of $0.55 recorded for the second quarter of 2018. The Company earned $1.0 million and diluted earnings per share of $0.65 for the six months ended June 30, 2019, as compared to $1.7 million in earnings and diluted earnings per share of $1.09 for the same period in 2018.

The decrease in quarterly earnings was due primarily to a negative provision for loan losses of $367 thousand which was recognized in 2018 compared to no provision in 2019. In addition, total interest expense increased from $679 thousand in 2018 to $1.06 million in the second quarter of 2019.

The decrease in year-to-date earnings was due primarily to a negative provision for loan losses of $512 thousand which was recognized in 2018 compared to no provision in 2019. In addition, total interest expense increased from $1.29 million in 2018 to $1.99 million in the first half of 2019. This exceeded the $394 thousand increase in interest income recognized in the first half of 2019 which was $8.76 million compared to $8.37 million in 2018.

The ratio of the allowance for loan losses to total loans stood at 0.99% and 1.02% as of June 30, 2019 and 2018, respectively, and at 1.01% as of December 31, 2018. Total nonperforming assets stood at $3.8 million and $2.9 million at June 30, 2019 and 2018, respectively, and at $2.1 million at December 31, 2018. The increase in the nonperforming assets as of June 30, 2019 primarily relates to one commercial loan relationship. The corresponding nonperforming assets to total assets ratios were 0.83% and 0.67% as of June 30, 2019 and 2018, respectively, and 0.50% at December 31, 2018.

The Company also reported that, as of June 30, 2019, assets stood at $455.4 million, with total deposits of $384.8 million and gross loans of $351.0 million, representing increases of 7.2%, 8.4%, and 7.5%, respectively, compared to June 30, 2018. Total shareholders' equity at June 30, 2019 was $37.1 million, an increase of $1.6 million from December 31, 2018. The increase primarily resulted from earnings of $1.0 million, offset by dividends of $252 thousand, an increase in additional paid-in capital of $410 thousand, which was from the exercise of stock options, and an increase in the fair value of available-for-sale securities of $363 thousand from December 31, 2018. On a per share basis, book value increased by $0.45 for 2019 to $23.51 per share at June 30, 2019 from $23.06 per share at December 31, 2018. The dividends declared per share decreased to $0.16 per share for the six month period ended June 30, 2019 as compared to $0.18 for the same period in 2018. A quarterly cash dividend was declared on the Company's common stock of $0.08 per share, plus a special cash dividend of $0.02 per share for the second quarter of 2018, as compared to $0.08 per share for the same period in 2019.

On July 2, 2019, the Company and ACNB Corporation ("ACNB"), the parent financial holding company of ACNB Bank, a Pennsylvania state-chartered, FDIC insured community bank headquartered in Gettysburg, PA, jointly announced the execution of a definitive agreement pursuant to which the Company will be merged with and into an ACNB acquisition subsidiary and, as soon as possible thereafter, Frederick County Bank, FCBI's wholly-owned subsidiary, will merge with and into ACNB Bank. Over the next few months, both entities will be finalizing several matters to consummate the merger, including filings with regulatory agencies. The merger is currently expected to close in the fourth quarter of 2019 or the first quarter of 2020.

Speaking on behalf of the Company, William R. Talley, Jr., Frederick County Bancorp, Inc. President & Chief Executive Officer, said, "We are pleased to join forces with a company that has laid a clear course for the future, and one in which we believe meets the objectives of our stakeholders due to its rich history and strong financial performance. ACNB Corporation provides the opportunity to continue the community banking vision upon which Frederick County Bank was founded with greater resources to serve the Frederick community into the future. We believe that by bringing these two banks together, our clients will benefit from additional resources such as insurance, trust/wealth management, treasury management services, government banking and a higher legal lending limit."

Frederick County Bank is headquartered in Frederick, Maryland, and conducts full service commercial banking services through five bank centers located in Frederick County, Maryland.

The statements in this press release that are not historical facts constitute "forward-looking statements" as defined by Federal securities laws. Forward-looking statements can generally be identified by the use of forward- looking terminology such as "believes," "expects," "intends," "may," "will," "should," "anticipates" or similar terminology. Such statements, specifically regarding the Company's intentions regarding growth and market expansion, are subject to risks and uncertainties that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, changes in interest rates, deposit flows, loan demand and real estate values, as well as changes in economic, competitive, governmental, regulatory, technological and other factors which may affect the Company specifically, its existing and target market areas or the banking industry generally. Forward-looking statements speak only as of the date they are made. The Company will not update forward-looking statements to reflect factual assumptions, circumstances or events that have changed after a forward-looking statement was made.