Bryn Mawr Bank (BMTC) 8-K Results of Operations and Financial Condition

Exhibit 99.1

Bryn Mawr Bank Corporation

FOR RELEASE:	IMMEDIATELY
FOR MORE INFORMATION CONTACT:
	Ted Peters, Chairman
	610-581-4800 or
	610-525-2531 (evening)
	tpeters@bmtc.com
	J. Duncan Smith, CFO
	610-526-2466 or
	610-306-8489 (evening)
	jdsmith@bmtc.com

Bryn Mawr Bank Corporation Reports a 12.5% Increase in Second Quarter Earnings Per Share and a 9.1% Dividend Increase.

BRYN MAWR, Pa. July 27, 2006 - Bryn Mawr Bank Corporation, (NASDAQ: BMTC), (the “Corporation”), parent of The Bryn Mawr Trust Company (the “Bank”), announced second quarter 2006 diluted earnings per share of $0.36, an increase of $0.04 or 12.5% compared to $0.32 in the same period last year. Net income for the second quarter of 2006 was $3.1 million, an increase of 12.5% or $349 thousand, compared to $2.8 million in last year’s second quarter. “Our strong performance was led by healthy loan growth during the first six months of the year. Portfolio loans have risen $44.5 million, or 15% annualized, since the end of 2005,” commented Chairman and CEO Ted Peters. “However, we continue to see pressure on our deposit gathering activities and deposit pricing function as competition in these areas is intense.”

The Corporation’s Board of Directors increased the quarterly dividend $0.01 per share or 9.1% from $0.11 to $0.12 per share, payable September 1, 2006, to shareholders of record as of August 7, 2006.

Return on average equity (ROE) and return on average assets (ROA) for the quarter ended June 30, 2006, were 15.70% and 1.74% respectively. ROE was 15.47% and ROA was 1.65% for the same period last year. The major factor contributing to the increase in earnings for the second quarter of 2006 compared to the same period last year was a $703 thousand or 9.1% increase in net interest income (on a tax equivalent basis) to $8.4 million from $7.7 million. The increase in net interest income (on a tax equivalent basis) in the second quarter of 2006 compared to the same period last year was the result of a $48.6 million increase or 7.9% increase in average interest earning assets and a 6 basis point increase in the Corporation’s net interest margin to 5.04% from 4.98%.

Diluted earnings per share for the six months ended June 30, 2006, was $0.72, an increase of $0.08 or 12.5%, compared with $0.64 in 2005. Net income for the six months ended June 30, 2006 was $6.3 million, an increase of $683 thousand or 12.2%, compared to $5.6 million in the same period last year. ROE and ROA for the six month period ended June 30, 2006 were 15.98% and 1.79%, respectively. ROE was 15.70% and ROA was 1.67% for the same period last year.

The major factor contributing to the increase in earnings for the six month period ending June 30, 2006 compared to the same period last year was a $1.6 million or 10.4% increase in net interest income (on a tax equivalent basis), partially offset by a $499 thousand or 3.3% increase in noninterest expenses. The increase in net interest income (on a tax equivalent basis) in the first six months of 2006 compared to the same period last year was the result of a $40.8 million or 6.6% increase in average interest earning assets, and an 18 basis point increase in the Corporation’s net interest margin to 5.13% from 4.95%.

Asset quality remains strong despite an increase in non-performing assets to $1.7 million at June 30, 2006 from $803 thousand and $415 thousand at March 31, 2006 and December 31, 2005, respectively. The $1.7 million of non-performing loans consists almost entirely of two first lien residential mortgage loans. Non-performing loans as a percentage of gross portfolio loans was 0.26% at June 30, 2006. The allowance for loan losses increased to $7.8 million at June 30,

2006 from $7.4 million at December 31, 2005, however the allowance as a percentage of portfolio loans decreased to 1.22% from 1.24% over the same time period. The decrease in the allowance as a percentage of portfolio loans is attributed to strong loan growth at the end of the second quarter. Net loan charge-offs (recoveries) for the six months ended June 30, 2006 and 2005 were ($14 thousand) and $55 thousand, respectively.

Portfolio loans increased $44.5 million or 7.5% to $639.6 million at June 30, 2006 from $595.2 million at December 31, 2005, reflecting a significant increase in commercial mortgage and construction loan closings in the second quarter of 2006. Second quarter 2006 average portfolio loans increased $26.3 million or 4.5% over fourth quarter 2005 average loans. Investment securities increased steadily over the six month period with June 30, 2006 balances up $12.3 million or 36.8% to $45.7 million from $33.4 million at December 31, 2005. The $32.3 million in federal funds sold at December 31, 2005 represented cash from short term, year-end customer deposits.

The Corporation’s interest bearing liabilities at June 30, 2006 include approximately $58 million in wholesale funding compared with $5 million at December 31, 2005. In addition to the wholesale funding, the Corporation has seen a shift in the mix of its core deposits as lower cost interest bearing checking, money market accounts and savings accounts move into higher yielding certificates of deposit. This change in the core deposit mix appears to be a national trend as competition for deposit balances is very intense, high rate advertisements are commonplace and the continued increase in interest rates has resulted in noticeable customer account movement.

Average non-interest bearing deposits were $150.6 million in the second quarter of 2006 compared to $147.3 million in the first quarter of 2006 and $152.2 in the fourth quarter of 2005. Average short term borrowings in the second quarter of 2006 were $16.7 million compared with $3.5 million in the first quarter of 2006 and $1.5 million in the fourth quarter of 2005. At June 30, 2006, the Corporation had over $230 million in unused borrowing capacity at the Federal Home Loan Bank of Pittsburgh along with capacity under federal funds lines of $48 million.

Chairman Ted Peters stated, “The Bryn Mawr Trust Company will continue with the expansion of its retail banking footprint with controlledde novo expansion in the suburban Philadelphia market. Construction has started on the Corporation’s new Ardmore branch, and we anticipate its opening in the fourth quarter of 2006. We also expect our new West Chester branch to open in the fourth quarter of 2007. This full service branch will also house the Corporation’s Chester County loan production center and a regional office for Wealth Management clients. We are excited about this opportunity to expand our business into the heart of West Chester, the county seat of Chester County, the fastest growing county in Pennsylvania.”

Non-interest income for the second quarter of 2006 was $4.6 million, a decrease of $166 thousand or 3.5% compared with $4.7 million in the same period last year. The decline in non-interest income is attributable to a continued decline in residential mortgage related revenues partially offset by an increase of Wealth Management Services fee income. Wealth Management assets under management and administration were $2.195 billion at June 30, 2006, compared with $2.248 billion at December 31, 2005 and $1.901 billion June 30, 2005. The increase in assets under management and administration for the 12 months ended June 30, 2006 is primarily due to an increase in wealth assets resulting from an acquisition made by a significant client in the third quarter of 2005. The decline in assets under management and administration over the past six months is primarily due to equity market valuations.

Non-interest expense for the second quarter of 2006 increased $38 thousand or 0.5% to $7.9 million when compared to the same period last year. Increases in salaries and employee benefits were partially offset by declines in mortgage servicing rights amortization and a decrease in professional fees. The decline in mortgage servicing rights amortization is expected to continue, while the decline in professional fees was partially due to a fewer number of audit engagements required to be performed in the current year. Other expenses include $53 thousand related to an interest rate floor contract with a notional amount of $25 million purchased in April of 2006 for asset liability management purposes.

Non-interest income for the six months ended June 30, 2006, increased nominally when compared to the same period last year. Fees for wealth management services revenues

increased $547 thousand or 9.7% to $6.2 million from $5.6 million. Virtually all areas of the Wealth business contributed to the increase in revenues. Other non-interest income categories in the aggregate declined $542 thousand, primarily due to lower residential mortgage related revenue.

Non-interest expense for the six months ended June 30, 2006, increased $499 thousand or 3.3%, to $15.7 million from $15.2 million in the same period last year, primarily due to increased employment related costs and occupancy expenses, partially offset by reduced mortgage servicing rights amortization and reduced professional fees. The reduction in mortgage servicing rights amortization is expected to continue as new mortgage origination volume is lower than in prior periods. The increase in occupancy expenses is related to rent expense on the new Ardmore branch site.

On a sequential basis, diluted earnings per share of $.36 and net income of $3.1 million remain unchanged. Net interest income (on a tax equivalent basis) increased $129 thousand or 1.6% on the strength of a $25.0 million or 3.9% increase in average interest earning assets, partially offset by a 18 basis point decrease in the net interest margin, as the net interest margin decreased to 5.04% from 5.22%. The decline in the net interest margin is attributable to the funding of loan growth with wholesale sources and a continued shift from lower cost core deposits into higher cost certificates of deposit. Management expects these market conditions to continue for the near term, resulting in increased downward pressure on the net interest margin.

Revenue from Wealth Management Services on a sequential basis declined $72 thousand or 2.3% to $3.0 million in the second quarter of 2006 compared with $3.1 million in the first quarter of 2006. This decline is partially attributable to lower fees from estate settlement and fiduciary tax services in the second quarter compared to the first quarter of 2006, as well as the decline in equity market value, particularly in June, in some sectors where our clients invest. Overall non-interest expenses increased $57 thousand or 0.7% to $7.9 million from $7.8 million as a reduction in professional fees was partially offset by increased advertising costs.

In conjunction with this release, the Corporation will host a conference call, followed by a question and answer session, on Friday, July 28th at 9:00 a.m. Eastern Time. Interested parties may participate by calling 973-582-2843 at 8:55 a.m. Eastern Time and referencing conference PIN 7633654. A taped replay of the conference call will be available within two hours of the conclusion of the call and will remain available through August 11, 2006. The number to call for the taped replay is 973-341-3080 and the conference PIN is 7633654.

The conference call will be simultaneously broadcasted live over the Internet through a webcast on the Bryn Mawr Bank Corporation website. To access the call, please visit the website at http://www.bmtc.com/investor_01.cfm. An online archive of the webcast will be available within two hours of the conclusion of the call.

This release contains certain forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words believe, expect, anticipate, intend, plan, estimate or words of similar meaning. Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors, many of which are beyond the Corporation’s control, could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Forward-looking statements speak only as of the date they are made. The Corporation does not undertake to update forward-looking statements.

The accompanying financial statements are an integral part of this press release.

# # # #

Bryn Mawr Bank Corporation

Consolidated Selected Financial Data

(Dollars in thousands, except per share data)

June 30, 2006

(unaudited)

	For The Three Months Ended
For the period:	June 30, 2006		Mar 31, 2006		Dec 31, 2005		Sept 30, 2005		June 30, 2005
Interest income	$	11,098	$	10,345	$	10,235	$	9,835	$	9,165
Interest expense		2,795		2,164		1,965		1,788		1,544
Net interest income		8,303		8,181		8,270		8,047		7,621
Provision for loan losses		209		154		173		209		193
Net interest income after provision for loan losses		8,094		8,027		8,097		7,838		7,428
Fees for wealth management services		3,048		3,120		2,946		2,972		2,967
Loan servicing and late fees		282		290		304		321		339
Service charges on deposits		397		379		392		408		398
Net gain on sale of loans		254		250		244		456		464
Other operating income		594		560		542		567		573
Non-interest income		4,575		4,599		4,428		4,724		4,741
Salaries and wages		3,834		3,829		4,183		4,414		3,758
Employee benefits		1,131		1,318		999		998		936
Occupancy and bank premises		642		624		571		564		581
Furniture fixtures and equipment		476		482		495		488		498
Advertising		273		200		277		195		312
Amortization of mortgage servicing rights		84		86		92		115		210
Professional fees		209		297		386		318		295
Other expenses		1,253		1,009		1,135		1,095		1,274
Non-interest expense		7,902		7,845		8,138		8,187		7,864
Income before income taxes		4,767		4,781		4,387		4,375		4,305
Income tax expense		1,630		1,645		1,503		1,499		1,517
Net income	$	3,137	$	3,136	$	2,884	$	2,876	$	2,788
Per share data:
Weighted average shares outstanding		8,577,365		8,570,675		8,556,250		8,555,037		8,549,675
Dilutive potential common shares		113,690		109,837		110,576		107,699		80,772
Adjusted weighted average dilutive shares		8,691,055		8,680,512		8,666,826		8,662,736		8,630,447
Basic earnings per common share		$0.37		$0.37		$0.34		$0.34		$0.33
Diluted earnings per common share		$0.36		$0.36		$0.33		$0.33		$0.32
Dividend declared per share		$0.11		$0.11		$0.11		$0.11		$0.10

Note: Certain prior period amounts have been reclassified to conform to current period presentation.

Bryn Mawr Bank Corporation

Consolidated Selected Financial Data

(Dollars in thousands, except per share data)

June 30, 2006

(unaudited)

	For The Six Months Ended
For the period:	June 30, 2006		June 30, 2005
Interest income	$	21,443	$	17,822
Interest expense		4,959		2,847
Net interest income		16,484		14,975
Provision for loan losses		363		380
Net interest income after provision for loan losses		16,121		14,595
Fees for wealth management services		6,168		5,621
Loan servicing and late fees		572		678
Service charges on deposits		776		793
Net gain on sale of loans		504		922
Other operating income		1,154		1,155
Non-interest income		9,174		9,169
Salaries and wages		7,663		7,265
Employee benefits		2,449		2,077
Occupancy and bank premises		1,266		1,137
Furniture fixtures and equipment		958		958
Advertising		473		488
Amortization of mortgage servicing rights		170		399
Professional fees		506		598
Other expenses		2,262		2,326
Non-interest expense		15,747		15,248
Income before income taxes		9,548		8,516
Income tax expense		3,275		2,926
Net income	$	6,273	$	5,590
Per share data:
Weighted average shares outstanding		8,574,038		8,570,533
Dilutive potential common shares		110,676		97,743
Adjusted weighted average shares		8,684,714		8,668,276
Basic earnings per common share		$0.73		$0.65
Diluted earnings per common share		$0.72		$0.64
Dividend declared per share		$0.22		$0.20

Note: Certain prior period amounts have been reclassified to conform to current period presentation.

Bryn Mawr Bank Corporation

Consolidated Selected Financial Data

(Dollars in thousands, except per share data )

June 30, 2006

(unaudited)

For the period:	2006 2Q			2006 1Q			2005 4Q	2005 3Q	2005 2Q
Asset Quality Data
Nonaccrual loans	$	866			773		390	273	678
90 + days past due loans		794			5		—	—	—
Nonperforming loans	$	1,660			778		390	273	678
OREO		—			25		25	—	210
Nonperforming assets	$	1,660			803		415	273	888
Allowance for loan losses	$	7,779			7,571		7,402	7,392	7,252
Allowance for loan losses / loans		1.22%			1.25%		1.24%	1.25%	1.22%
Allowance for loan losses / nonperforming loans		469%			973%		1,898%	2,708%	1,070%
Nonperforming loans / loans		0.26%			0.13%		0.07%	0.05%	0.11%
Nonperforming assets / assets		0.22%			0.11%		0.06%	0.04%	0.13%
Net loan charge-offs (recoveries)		1			(15	)	162	69	66
Net loan charge-offs (annualized)/ average loans		NC	*		NC	*	0.11%	0.05%	0.05%
	2006 2Q			2006 1Q			2005 4Q	2005 3Q	2005 2Q
Selected ratios (annualized):
Return on average assets		1.74%			1.83%		1.65%	1.65%	1.65%
Return on average shareholders’ equity		15.70%			16.27%		15.04%	15.35%	15.47%
Yield on interest earning assets**		6.72%			6.58%		6.41%	6.18%	5.98%
Cost of interest bearing funds		2.35%			1.92%		1.73%	1.57%	1.37%
Net interest margin**		5.04%			5.22%		5.19%	5.07%	4.98%
Tier 1 leverage ratio		11.39%			11.53%		11.25%	11.02%	10.87%
Book value per share	$	9.52			9.29		9.06	8.86	8.63
Tangible book value per share	$	9.52			9.29		9.06	8.86	8.63
Period end shares outstanding		8,575,398			8,575,555		8,556,255	8,559,105	8,543,046
Selected data:
Mortgage loans originated	$	31,966			34,451		33,146	62,759	46,010
Mortgage loans sold – servicing retained	$	3,615			7,010		6,889	11,016	9,972
Mortgage loans sold – servicing released	$	13,127			7,436		18,460	23,051	16,817
Mortgage loans serviced for others	$	395,091			409,429		417,649	438,183	465,780
Wealth assets under management / administration	$	2,195,258			2,262,064		2,247,630	2,205,380	1,900,928
				2006 Year-to-date				2005 Year-to-date
Selected ratios (annualized):
Return on average assets					1.79%			1.67%
Return on average shareholders’ equity					15.98%			15.70%
Yield on interest earning assets**					6.65%			5.89%
Cost of interest bearing funds					2.14%			1.28%
Net interest margin**					5.13%			4.95%
Mortgage loans originated				$	66,417			84,559
Mortgage loans sold – servicing retained				$	10,625			23,759
Mortgage loans sold – servicing released				$	20,563			37,026

* Not calculated as there were no significant 2006 charge-offs

** Yield on interest earning assets and net interest margin are calculated on a tax equivalent basis.

Bryn Mawr Bank Corporation

Consolidated Selected Financial Data

(Dollars in thousands)

June 30, 2006

(unaudited)

Balance Sheet

				As of
	June 30, 2006			Mar 31, 2006			Dec 31, 2005			Sept 30, 2005			June 30, 2005
Assets
Interest bearing deposits with banks	$	642		$	508		$	405		$	8,075		$	314
Fed funds sold		—			—			32,341			—			—
Investment securities		45,697			41,488			33,397			33,968			34,215
Loans held for sale		6,369			4,061			2,765			9,073			8,147
Portfolio loans:
Consumer		8,863			9,149			9,437			8,791			9,482
Commercial & industrial		166,442			165,508			170,283			172,115			193,402
Commercial mortgages		178,253			166,816			162,621			162,187			149,604
Construction		65,097			49,375			45,523			37,386			42,842
Residential mortgages		108,820			106,196			99,602			95,351			84,176
Home equity lines & loans		112,157			109,534			107,699			106,562			106,327
Total portfolio loans		639,632			606,578			595,165			582,392			585,833
Earning assets		692,340			652,635			664,073			633,508			628,509
Cash and due from		27,529			26,132			33,896			30,976			33,979
Allowance for loan losses		(7,779	)		(7,571	)		(7,402	)		(7,392	)		(7,252	)
Other assets		39,392			38,737			36,659			35,875			35,516
Total assets	$	751,482		$	709,933		$	727,226		$	692,967		$	690,752
Interest-bearing checking	$	134,754		$	142,606		$	154,319		$	148,042		$	140,271
Money market		106,401			115,920			112,319			118,548			125,972
Savings		43,303			44,830			46,258			47,721			51,141
Time deposits		197,980			153,412			155,322			137,262			126,538
Interest-bearing deposits		482,438			456,768			468,218			451,573			443,922
Non-interest bearing deposits		152,092			151,324			168,042			153,084			161,448
Total deposits		634,530			608,092			636,260			604,657			605,370
Borrowed funds		22,700			8,000			—			—			—
Other liabilities		12,597			14,171			13,453			12,491			11,617
Shareholders’ equity		81,655			79,670			77,513			75,819			73,765
Total liabilities and shareholders’ equity	$	751,482		$	709,933		$	727,226		$	692,967		$	690,752
Balance Sheet (average)
	2006 2Q			2006 1Q			2005 4Q			2005 3Q			2005 2Q
Interest bearing deposits with banks	$	687		$	439		$	1,176		$	4,730		$	536
Fed funds sold		1,467			6,161			8,115			7,420			5,119
Investment securities		44,197			37,069			34,501			34,520			34,828
Loans held for sale		3,304			3,217			3,142			8,690			9,046
Portfolio loans		617,627			595,446			591,294			580,036			569,127
Earning assets		667,282			642,332			638,228			635,396			618,656	��
Cash and due from		24,666			24,332			25,754			27,413			33,259
Allowance for loan losses		(7,686	)		(7,524	)		(7,460	)		(7,359	)		(7,251	)
Other assets		37,803			35,819			35,162			34,993			34,975
Total assets	$	722,065		$	694,959		$	691,684		$	690,443		$	679,639
Interest-bearing checking	$	140,400		$	141,504		$	141,441		$	142,400		$	148,943
Money market		110,710			118,365			117,033			126,128			119,261
Savings		43,738			45,073			46,699			49,695			50,897
Time deposits		166,228			147,610			143,156			133,052			128,777
Interest-bearing deposits		461,076			452,552			448,329			451,275			447,878
Non-interest bearing deposits		150,586			147,274			152,230			152,048			146,140
Total deposits		611,662			599,826			600,559			603,323			594,018
Borrowed funds		16,738			3,544			1,505			516			3,540
Other liabilities		13,487			13,419			13,534			12,303			9,803
Shareholders’ equity		80,178			78,170			76,086			74,301			72,278
Total liabilities and shareholders’ equity	$	722,065		$	694,959		$	691,684		$	690,443		$	679,639

Note: Certain prior period amounts have been reclassified to conform to current period presentation.

Quarterly Average Balances and Tax Equivalent Income and Expense and Tax Equivalent Yields

(unaudited)	2nd Quarter 2006							1st Quarter 2006							4th Quarter 2005							3rd Quarter 2005							2nd Quarter 2005
(dollars in thousands)	Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid
Assets:
Interest-bearing deposits with other banks	$	687		$	8	4.67	%	$	439		$	5	4.62	%	$	1,176		$	11	3.71	%	$	4,730		$	44	3.69	%	$	536		$	3	2.24	%
Federal funds sold		1,467			18	4.92	%		6,161			66	4.34	%		8,115			85	4.16	%		7,420			64	3.42	%		5,119			36	2.82	%
Investment securities available for sale		44,197			475	4.31	%		37,069			366	4.00	%		34,501			310	3.56	%		34,520			308	3.54	%		34,828			296	3.41	%
Loans		620,931			10,683	6.90	%		598,663			9,987	6.77	%		594,436			9,904	6.61	%		588,726			9,489	6.39	%		578,173			8,895	6.17	%
Total interest earning assets		667,282			11,184	6.72	%		642,332			10,424	6.58	%		638,228			10,310	6.41	%		635,396			9,905	6.18	%		618,656			9,230	5.98	%
Cash and due from banks		24,666							24,332							25,754							27,413							33,259
Less allowance for loan losses		(7,686	)						(7,524	)						(7,460	)						(7,359	)						(7,251	)
Other assets		37,803							35,819							35,162							34,993							34,975
Total assets	$	722,065						$	694,959						$	691,684						$	690,443						$	679,639
Liabilities:
Savings, Now and market rate deposits	$	294,848		$	934	1.27	%	$	304,942		$	821	1.09	%	$	305,173		$	764	0.99	%	$	318,223		$	770	0.96	%	$	319,101		$	647	0.81	%
Time deposits		166,228			1,645	3.97	%		147,610			1,301	3.57	%		143,156			1,185	3.28	%		133,052			1,013	3.02	%		128,777			869	2.71	%
Total interest-bearing deposits		461,076			2,579	2.24	%		452,552			2,122	1.90	%		448,329			1,949	1.72	%		451,275			1,783	1.57	%		447,878			1,516	1.36	%
Short term borrowings		16,738			216	5.18	%		3,544			42	4.81	%		1,505			16	4.22	%		516			5	3.84	%		3,540			28	3.17	%
Total interest-bearing liabilities		477,814			2,795	2.35	%		456,096			2,164	1.92	%		449,834			1,965	1.73	%		451,791			1,788	1.57	%		451,418			1,544	1.37	%
Demand deposits, noninterest-bearing		150,586							147,274							152,230							152,048							146,140
Other liabilities		13,487							13,419							13,534							12,303							9,803
Total noninterest-bearing liabilities		164,073							160,693							165,764							164,351							155,943
Total liabilities		641,887							616,789							615,598							616,142							607,361
Shareholders’ equity		80,178							78,170							76,086							74,301							72,278
Total liabilities and shareholders’ equity	$	722,065						$	694,959						$	691,684						$	690,443						$	679,639
Net interest spread						4.37	%						4.66	%						4.68	%						4.61	%						4.61	%
Effect of noninterest-bearing sources						0.67	%						0.56	%						0.51	%						0.46	%						0.37	%
Net interest income/ margin on earning assets				$	8,389	5.04	%				$	8,260	5.22	%				$	8,345	5.19	%				$	8,117	5.07	%				$	7,686	4.98	%
Tax equivalent adjustment				$	86	0.05	%				$	79	0.05	%				$	75	0.05	%				$	70	0.05	%				$	65	0.04	%

Non-accrual loans are included in the average loan balances.

	Average Balances and Tax Equivalent Income and Expense and Tax Equivalent Yields For the Six Months ended June 30,
(unaudited)	2006							2005
(dollars in thousands)	Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid
Assets:
Interest-bearing deposits with other banks	$	564		$	13	4.65	%	$	1,834		$	21	2.31	%
Federal funds sold		3,801			84	4.46	%		4,769			61	2.58	%
Investment securities available for sale		40,653			841	4.17	%		34,429			583	3.41	%
Loans		609,860			20,670	6.83	%		573,036			17,268	6.08	%
Total interest earning assets		654,878			21,608	6.65	%		614,068			17,933	5.89	%
Cash and due from banks		24,500						$	33,308
Less allowance for loan losses		(7,606	)						(7,155	)
Other assets		36,809							34,465
Total assets	$	708,581						$	674,686
Liabilities:
Savings, Now and market rate deposits	$	299,867		$	1,755	1.18	%	$	322,893		$	1,209	0.76	%
Time deposits		156,970			2,947	3.79	%		123,018			1,602	2.63	%
Total interest-bearing deposits		456,837			4,702	2.08	%		445,911			2,811	1.27	%
Short term borrowings		10,177			257	5.09	%		2,401			36	3.02	%
Total interest-bearing liabilities		467,014			4,959	2.14	%		448,312			2,847	1.28	%
Demand deposits, noninterest-bearing		148,941							144,792
Other liabilities		13,451							9,796
Total noninterest-bearing liabilities		162,392							154,588
Total liabilities		629,406							602,900
Shareholders’ equity		79,175							71,786
Total liabilities and shareholders’ equity	$	708,581						$	674,686
Net interest spread						4.51	%						4.61	%
Effect of noninterest-bearing sources						0.62	%						0.34	%
Net interest income/ margin on earning assets				$	16,649	5.13	%				$	15,086	4.95	%
Tax equivalent adjustment				$	165	0.05	%				$	111	0.04	%

Non-accrual loans are included in the average loan balances.