SecProbe.io

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 82 Main Street

 Bar Harbor, Maine 04609

 April 30, 2025

 VIA EDGAR

 U.S. Securities and Exchange Commission

 Division of Corporation Finance

 100 F Street, NE

 Washington, DC 20549

 Re:
 Bar Harbor Bankshares

 Registration Statement on Form S-4

 Request for Acceleration of Effectiveness

 File No. 333-286627

 Ladies and Gentlemen:

 Pursuant to Rule 461
of Regulation C, and in connection with the above-referenced Registration Statement on Form S-4, Bar Harbor Bankshares (the "Company")
hereby requests that said Registration Statement on Form S-4 be declared effective on Friday, May 2, 2025 at 2:00 p.m., Eastern
time, or as soon thereafter as practicable.

 If you have any questions
regarding this request, please telephone Edward G. Olifer of Kilpatrick Townsend & Stockton LLP at 202.508.5852.

 Very truly yours,

 BAR HARBOR BANKSHARES

 /s/ Curtis C. Simard

 Curtis C. Simard

 President and Chief Executive Officer

 cc:         Robert
Arzonetti, U.S. Securities and Exchange Commission

<DOCUMENT>
<TYPE>TEXT-EXTRACT
<SEQUENCE>2
<FILENAME>filename2.txt
<TEXT>
 April 23, 2025

Curtis C. Simard
Chief Executive Officer
Bar Harbor Bankshares
82 Main Street
Bar Harbor, ME 04609-0400

 Re: Bar Harbor Bankshares
 Registration Statement on Form S-4
 Filed April 18, 2025
 File No. 333-286627
Dear Curtis C. Simard:

 This is to advise you that we have not reviewed and will not review your
registration
statement.

 Please refer to Rules 460 and 461 regarding requests for acceleration.
We remind you
that the company and its management are responsible for the accuracy and
adequacy of their
disclosures, notwithstanding any review, comments, action or absence of action
by the staff.

 Please contact Robert Arzonetti at 202-551-8819 with any questions.

 Sincerely,

 Division of
Corporation Finance
 Office of Finance
cc: Edward G. Olifer
</TEXT>
</DOCUMENT>

October 23, 2024
Josephine Iannelli
Chief Financial Officer
Bar Harbor Bankshares
PO Box 400, 82 Main Street
Bar Harbor, ME 04609-0400
Re:Bar Harbor Bankshares
Form 10-K for Fiscal Year Ended December 31, 2023
File No. 001-13349
Dear Josephine Iannelli:
            We have completed our review of your filing. We remind you that the company and
its management are responsible for the accuracy and adequacy of their disclosures,
notwithstanding any review, comments, action or absence of action by the staff.
Sincerely,
Division of Corporation Finance
Office of Finance

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October 22, 2024

​

​

Mengyao Lu and Robert Klein

Division of Corporation Finance

Office of Finance

US Securities and Exchange Commission

100 F Street, NE

Washington, DC 20549

​

Re:  Bar Harbor Bankshares

Form 10-K for the Fiscal Year Ended December 31, 2023

Filed on March 11, 2024

File No.  001-13349

​

Dear Ms. Lu and Mr. Klein:

​

We are hereby submitting to the staff (Staff) of the Securities and Exchange Commission this letter setting forth the Company’s response to the comment contained in the Staff’s letter dated September 19, 2024 regarding the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed on March 11, 2024.

​

The Staff’s comment is repeated below in bold italics and is followed by the Company’s responses.

​

Form 10-K for Fiscal Year Ended December 31, 2023 Non-GAAP Financial Measures, page 45.

​

We note your presentation of a non-GAAP financial measure for “Tangible book value per share, excluding securities adjustment,” which represents the exclusion of the total unrealized loss on available-for-sale securities recorded within total common shareholders’ equity. This represents an individually tailored accounting measure given that the adjustment to exclude the unrealized (loss) gain on securities has the effect of changing the recognition measurement principles required to be applied in accordance with GAAP. Therefore, please remove the presentation of this non-GAAP measure from your future filings. Refer to Question 100.04 of the Division of Corporation Finance’s Compliance & Disclosure Interpretations on Non-GAAP Financial Measures and Rule 100(b) of Regulation G.

​

​

COMPANY’S RESPONSE:  Going forward, the Company will remove any presentation of “Tangible book value per share excluding securities adjustment” from any and all future filings.

​

​

​

We appreciate your feedback and these changes will be reflected in our upcoming 8-K and 10-Q for the quarter ended September 30, 2024.  If you have any questions, please contact me by telephone at 207-288-9343 or via email at jiannelli@barharbor.bank.

Sincerely,

Josephine Iannelli

Chief Financial Officer and Treasurer

September 19, 2024
Josephine Iannelli
Chief Financial Officer
Bar Harbor Bankshares
PO Box 400, 82 Main Street
Bar Harbor, ME 04609-0400
Re:Bar Harbor Bankshares
Form 10-K for Fiscal Year Ended December 31, 2023
File No. 001-13349
Dear Josephine Iannelli:
            We have limited our review of your filing to the financial statements and related
disclosures and have the following comment.
            Please respond to this letter within ten business days by providing the requested
information or advise us as soon as possible when you will respond. If you do not believe a
comment applies to your facts and circumstances, please tell us why in your response.
            After reviewing your response to this letter, we may have additional comments.
Form 10-K for Fiscal Year Ended December 31, 2023
Non-GAAP Financial Measures, page 45
1.We note your presentation of a non-GAAP financial measure for "Tangible book value
per share, excluding securities adjustment," which represents the exclusion of the total
unrealized loss on available-for-sale securities recorded within total common
shareholders' equity. This represents an individually tailored accounting measure given
that the adjustment to exclude the unrealized (loss) gain on securities has the effect of
changing the recognition and measurement principles required to be applied in accordance
with GAAP. Therefore, please remove the presentation of this non-GAAP measure from
your future filings. Refer to Question 100.04 of the Division of Corporation Finance’s
Compliance & Disclosure Interpretations on Non-GAAP Financial Measures and Rule
100(b) of Regulation G.
            In closing, we remind you that the company and its management are responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or
absence of action by the staff.

September 19, 2024
Page 2
            Please contact Mengyao Lu at 202-551-3471 or Robert Klein at 202-551-3847 with any
questions.
Sincerely,
Division of Corporation Finance
Office of Finance

United States securities and exchange commission logo
December 8, 2021
Josephine Iannelli
Chief Financial Officer
Bar Harbor Bankshares
PO Box 400
82 Main Street
Bar Harbor, ME 04609
Re:Bar Harbor Bankshares
Form 10-K For the Fiscal Year Ended December 31, 2020
File No. 001-13349
Dear Ms. Iannelli:
            We have completed our review of your filing.  We remind you that the company and its
management are responsible for the accuracy and adequacy of their disclosures, notwithstanding
any review, comments, action or absence of action by the staff.
Sincerely,
Division of Corporation Finance
Office of Finance

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December 6, 2021

Michael Henderson and Robert Klein

Division of Corporation Finance

Office of Finance

US Securities and Exchange Commission

100 F Street, NE

Washington, DC 20549

Re: Bar Harbor Bankshares

Form 10-K for the Fiscal Year Ended December 31, 2020

Filed on March 10, 2021

File No. 001-13349

Dear Mr. Henderson and Mr. Klein:

We are hereby submitting to the staff (Staff) of the Securities and Exchange Commission this letter setting forth the Company’s response to the comment contained in the Staff’s letter dated November 24, 2021 regarding the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed on March 10, 2021.

The Staff’s comment is repeated below in bold italics and is followed by the Company’s responses. Capitalized terms used but not otherwise defined herein have the meanings set forth in the 10-K.

Form 10-K filed on March 10, 2021.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations Application of Critical Accounting Policies and Accounting Estimates, and Recent Accounting Pronouncements, page 48.

We note your disclosure of your critical accounting policies, which refers to the Notes to the Consolidated Financial Statements for information regarding your significant accounting policies. In future filings, please revise your disclosures to discuss qualitative and quantitative information necessary to understand the estimation uncertainty and the impact the critical accounting estimate has had or is reasonably likely to have on financial condition or results of operations, as well as a sensitivity analysis of the reported amount to the methods, assumptions and estimates underlying the calculations. We also note that such disclosure should supplement, not duplicate, the description of accounting policies that are already disclosed in the notes to the financial statements. We refer you to Section V of SEC Release No. 33-8350 and Item 303(b) of Regulation S-K.

RESPONSE: Going forward, the Company will revise its disclosures to discuss qualitative and quantitative information necessary to understand the estimation uncertainty and the impact the critical accounting estimate has had or is reasonably likely to have on financial condition or results of operations. The disclosures will include a sensitivity analysis of the reported amount to the methods, assumptions and estimates underlying the calculations. Critical accounting policies are defined as those that are reflective of significant judgments and uncertainties, and could potentially result in materially different results under different assumptions and conditions. In preparing the Company’s consolidated financial statements, management is required to make significant estimates and assumptions that affect assets, liabilities, revenues, and expenses reported. Our disclosures will be revised to discuss the qualitative and quantitative information necessary to understand these estimations and assumptions and not duplicate what is already described in the accounting policies.

We appreciate your feedback and these changes will be reflected in our upcoming 10-K for the year ended December 31, 2021. If you have any questions regarding the 10-K, please contact me by telephone at 207-288-9343 or via email at jiannelli@barharbor.bank.

Sincerely,

Josephine Iannelli

Chief Financial Officer and Treasurer

United States securities and exchange commission logo
November 24, 2021
Josephine Iannelli
Chief Financial Officer
Bar Harbor Bankshares
PO Box 400
82 Main Street
Bar Harbor, ME 04609
Re:Bar Harbor Bankshares
Form 10-K For the Fiscal Year Ended December 31, 2020
Filed March 10, 2021
File No. 001-13349
Dear Ms. Iannelli:
            We have limited our review of your filing to the financial statements and related
disclosures and have the following comment.  In our comment, we may ask you to provide us
with information so we may better understand your disclosure.
            Please respond to this comment within ten business days by providing the requested
information or advise us as soon as possible when you will respond.  If you do not believe our
comment applies to your facts and circumstances, please tell us why in your response.
            After reviewing your response to this comment, we may have additional comments.
Form 10-K for the Fiscal Year Ended December 31, 2020
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
Application of Critical Accounting Policies and Accounting Estimates, and Recent Accounting
Pronouncements, page 48
1.We note your disclosure of your critical accounting policies, which refers to the Notes to
the Consolidated Financial Statements for information regarding your significant
accounting policies. In future filings, please revise your disclosures to discuss
qualitative and quantitative information necessary to understand the estimation uncertainty
and the impact the critical accounting estimate has had or is reasonably likely to have on
financial condition or results of operations, as well as a sensitivity analysis of the reported
amount to the methods, assumptions and estimates underlying the calculations. We also
note that such disclosure should supplement, not duplicate, the description of accounting
policies that are already disclosed in the notes to the financial statements. We refer you to

 FirstName LastNameJosephine Iannelli
 Comapany NameBar Harbor Bankshares
 November 24, 2021 Page 2
 FirstName LastName
Josephine Iannelli
Bar Harbor Bankshares
November 24, 2021
Page 2
Section V of SEC Release No. 33-8350 and Item 303(b) of Regulation S-K.
            In closing, we remind you that the company and its management are responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or
absence of action by the staff.
            You may contact Michael Henderson, Staff Accountant, at 202-551-3364 or Robert
Klein, Staff Accountant, at 202-551-3847 with any questions.
Sincerely,
Division of Corporation Finance
Office of Finance

January 30, 2020
Curtis C. Simard
President and Chief Executive Officer
BAR HARBOR BANKSHARES
82 Main Street
Bar Harbor, ME 04609-0400
Re:BAR HARBOR BANKSHARES
Registration Statement on Form S-4
Filed January 24, 2020
File No. 333-236066
Dear Mr. Simard:
            This is to advise you that we have not reviewed and will not review your registration
statement.
            Please refer to Rules 460 and 461 regarding requests for acceleration.  We remind you
that the company and its management are responsible for the accuracy and adequacy of their
disclosures, notwithstanding any review, comments, action or absence of action by the staff.
            Please contact Jessica Livingston at 202-551-3448 with any questions.
Sincerely,
Division of Corporation Finance
Office of Finance

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    January 30, 2020

    Via EDGAR

    Securities and Exchange Commission

    Division of Corporation Finance

    100 F Street, N.E.

    Washington, D.C. 20549

    Attention:  Jessica Livingston

              Re:

              Bar Harbor Bankshares

    Registration Statement on Form S-4

    File No. 333-236066

    Ladies and Gentlemen:

    With respect to the above-referenced registration statement (the “Registration Statement”) and pursuant to Rule 461 of Regulation C promulgated under the
      Securities Act of 1933, Bar Harbor Bankshares (the “Company”) hereby respectfully requests that the Securities and Exchange Commission (the “Commission”) accelerate the
      effective date of the Registration Statement so that it is declared effective at 5:00 p.m., Eastern time, on February 3, 2020, or as soon as practicable thereafter.

    In connection with this request for the acceleration of the effective date of the Registration Statement, the Company acknowledges that:

              (i)

                should the Commission or the staff, acting pursuant to delegated authority, declare the filing effective, it does not foreclose the Commission from taking any action with respect to the filing;

              (ii)

                the action of the Commission or the staff, acting pursuant to delegated authority, in declaring the filing effective, does not relieve the Company from its full responsibility for the adequacy and accuracy of the disclosure in the
                  filing; and

              (iii)

                the Company may not assert staff comments and the declaration of effectiveness as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

    Please contact Mark L. Johnson of K&L Gates LLP at 617.261.3260 with any questions you may have concerning this request.

            Sincerely,

            Bar Harbor Bankshares

            By:

            /s/ Josephine Iannelli

            Josephine Iannelli

            Executive Vice President and Chief Financial Officer

              cc:

              Curtis C. Simard, Bar Harbor Bankshares

    Caitlin Dunston, Bar Harbor Bankshares

    Mark L. Johnson, K&L Gates LLP

    Stephen Palmer, K&L Gates LLP

    Bella Zaslavsky, K&L Gates LLP

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Acceleration Letter

 [Bar Harbor Letterhead]

September 1, 2016

 By EDGAR and Electronic Mail

Dietrich A. King

 Assistant Director

Office of Financial Services

 Securities and Exchange Commission

 100 F. Street, N.E.

 Washington, D.C. 20549

Re:
Bar Harbor Bankshares

Registration Statement on Form S-4

File No. 333-212588

Request for Acceleration

 Dear Mr. King:

In accordance with Rule 461 under the Securities Act of 1933, as amended, Bar Harbor Bankshares (the “Company”) hereby requests that its
Registration Statement on Form S-4 filed with the Securities and Exchange Commission (the “Commission”) on July 19, 2016 (File No. 333-212588), as amended on August 18, 2016 and September 1, 2016 (the “Registration
Statement”), be made effective at 4:00 p.m. New York City time on September 6, 2016, or as soon as possible thereafter.

 In connection with the
foregoing request for acceleration of effectiveness, the Company hereby acknowledges that:

•

should the Commission or the staff of the Commission (the “Staff”), acting pursuant to delegated authority, declare the filing effective, it does not foreclose the Commission from taking any action with
respect to the filing;

•

the action of the Commission or the Staff, acting pursuant to delegated authority, in declaring the filing effective, does not relieve the Company from its full responsibility for the adequacy and accuracy of the
disclosure in the filing; and

•

the Company may not assert Staff comments and the declaration of effectiveness as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

 * * * * *

 Please do not hesitate to contact Stephen L. Palmer of K&L Gates LLP at (617) 951-9211 or by email at
stephen.palmer@klgates.com if you have any questions or comments regarding this matter. In addition, please notify Mr. Palmer when this request for acceleration has been granted.

Respectfully yours,

 /s/ Curtis C. Simard

Curtis C. Simard

cc:
Stephen R. Theroux, Lake Sunapee Bank Group

Stephen L. Palmer, K&L Gates LLP

Richard A. Schaberg, Hogan Lovells US LLP

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CORRESP

 August 18, 2016

By EDGAR and Electronic Mail

Dietrich A. King

 Assistant Director

Office of Financial Services

 Securities and Exchange
Commission

 100 F. Street, N.E.

 Washington, D.C.
20549

 Stephen L. Palmer

 stephen.palmer@klgates.com

 T (617) 951-9211

F (617) 261-3175

Re:

 Bar Harbor Bankshares

 Registration
Statement on Form S-4

 Filed July 19, 2016

File No. 333-212588

 Dear Mr. King:

 On behalf
of Bar Harbor Bankshares (the “Company”), we submit this letter in response to comments from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) received by letter
dated August 5, 2016 relating to the Company’s Registration Statement on Form S-4, filed on July 19, 2016 (the “Registration Statement”). The Company has filed today via EDGAR an amendment to the Registration
Statement on Form S-4 (“Amendment No. 1”).

 In this letter, we have recited the written comments from the Staff in italicized, bold
type and have followed each comment with the Company’s response. The numbering below corresponds to the numbering in the Comment Letter and all page references in the Company’s responses below regarding revised disclosure refer to
Amendment No. 1.

 Proposal I – The Merger, page 42

LSBG’s Reasons for the Merger, page 47

1.
We note in the third bullet on page 49 you disclose that under the terms of the merger agreement, in the event that BHB’s stock price declines by 20% from $34.55 and by 20% compared to the SNL Bank Index, as
determined and calculated under the terms of the merger agreement, LSBG may terminate the merger, unless BHB increases the exchange ratio. Please tell us how you plan to register any additional shares that may be issued in the event that BHB
increases the exchange ratio.

 K&L GATES LLP

STATE STREET FINANCIAL CENTER    ONE LINCOLN STREET    BOSTON MA 02111

T +1 617 261 3100    F +1 617 261 3175    klgates.com

 The Company respectfully advises the Staff that the Company will file a registration statement
under Rule 462(b) or Rule 429 under the Securities Act of 1933, as applicable, following the effective date of the Form S-4 to reflect any increase in the number of shares of the Company’s common stock to be issued. Accordingly, the Company has
revised footnote 1 to the registration fee table of Amendment No. 1 to clarify that the Company will be required to file a registration statement pursuant to Rule 413 to register any additional shares that may be issued in the event the Company
increases the exchange ratio.

2.
We note on page 51 you disclose that Griffin received projections from BHB’s management. Similarly, on page 68 you disclose that Sandler O’Neill received projections from LSBG’s management. Please
disclose all material projections provided by BHB and LSBG to the other party’s financial advisor.

 The Company
has disclosed the material projections provided by Lake Sunapee Bank Group and the Company beginning on pages 78 and 80, respectively, of Amendment No. 1.

Financial Impact Analysis, page 59

3.
Please disclose the amount of fees that LSBG paid to Griffin during the past two years for the services you describe in the fourth paragraph on page 59. See Item 4(b) of Form S-4 and Item 1015(b)(4) of
Regulation M-A.

 The Company has disclosed the amount of such fees on page 59 of Amendment No. 1.

The Merger Agreement, page 85

4.
In the first paragraph on page 85 you state that some of the representations and warranties contained in the merger agreement “generally were solely for the benefit of the parties to that agreement.”
Similarly, in the third paragraph on page 87, you state that “[Investors] should not rely on the representations and warranties as statements of factual information. Third parties are not entitled to the benefits of the representations and
warranties in the merger agreement.” Please revise your disclosure to remove the inappropriate limitations on reliance on the representations and warranties contained in the merger agreement, which constitute disclosure under the federal
securities laws. For guidance, please refer to Report of Investigation Pursuant to Section 21(a) of the Securities Exchange Act of 1934 and Commission Statement on potential Exchange Act Section 10(b) and Section 14(a) liability,
Securities Exchange Act Release No. 51283 (March 1, 2005).

 The Company has revised the disclosure on pages 87
and 89 of Amendment No. 1 to remove the limitations on reliance on the representations and warranties contained in the merger agreement. The Company has further clarified on page 89 of Amendment No. 1 that it and Lake Sunapee Bank Group
will provide additional disclosures in their public reports to the extent that they are aware of the existence of any material facts that are required to be disclosed under federal securities laws and that might otherwise contradict the terms and
information contained in the merger agreement and will update such disclosure as required by federal securities laws.

 2

 In connection with responding to the Staff’s comments, the Company hereby acknowledges that:

•

should the Commission or the Staff, acting pursuant to delegated authority, declare the filing effective, it does not foreclose the Commission from taking any action with respect to the filing;

•

the action of the Commission or the Staff, acting pursuant to delegated authority, in declaring the filing effective, does not relieve the Company from its full responsibility for the adequacy and accuracy of the
disclosure in the filing; and

•

the Company may not assert Staff comments and the declaration of effectiveness as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

 * * * * *

 Please do not
hesitate to contact me at (617) 951-9211 if you have any questions or would like additional information regarding this matter.

Respectfully yours,

 /s/ Stephen L. Palmer

Stephen L. Palmer

cc:

Curtis C. Simard, Bar Harbor Bankshares

Mail Stop 4720

August 5, 2016

Via E -mail
Curtis C. Simard
President and Chief Executive Officer
Bar Harbor Bankshares
82 Main Street
Bar Harbor, ME 04609

Re: Bar Harbor Bankshares
Registration Statement on Form S -4
Filed July 19, 2016
  File No. 333-212588

Dear  Mr. Simard :

We have limited our review of your registration statement to those issues we have
addressed in our comments.  In  some of our comments, we may ask you to provide us with
information so we may better understand your disclosure.

Please respond to this letter by amending your registration statement and providing the
requested information.   If you do not  believe our com ments apply to your facts and
circumstances or do not believe an amendment is appropriate, please  tell us why in your
response.

After reviewing any amendment to your registration statement and the information you
provide in response to these  comments, we may have  additional comments.

Proposal I – The Merger, page 42

LSBG’s Reasons for the Merger, page 47

1. We note in the third bullet on page 49 you disclose that under the terms of the merger
agreement, in the event that BHB’s stock price declines by 20%  from $34.55 and by 20%
compared to the SNL Bank Index, as determined and calculated under the terms of the
merger agreement, LSBG may terminate the merger, unless BHB increases the exchange
ratio.  Please tell us how you plan to register any additional sh ares that may be issued in
the event that BHB increases the exchange ratio.

Curtis C. Simard
Bar Harbor Bankshares
August 5, 2016
Page 2

 2. We note on page 51 you disclose that Griffin received projections from BHB’s
management.  Similarly, on page 68 you disclose that Sandler O’Neill received
projections from LSBG’s management.  Please disclose all material projections provided
by BHB and LSBG to the other party’s financial advisor.

Financial Impact Analysis, page 59

3. Please disclose the amount of fees that LSBG paid to Griffin during the past two years  for
the services you describe in the fourth paragraph on page 59. See Item 4(b) of Form S -4
and Item 1015(b)(4) of Regulation M -A.

The Merger Agreement, page 85

4. In the first paragraph on page 85 you state that some of the representations and warranties
contained in the merger agreement “generally were solely for the benefit of the parties to
that agreement.”  Similarly, in the third paragraph on page 87, you state that “[Investors]
should not rely on the representations and warranties as statements of factua l information.
Third parties are not entitled to the benefits of the representations and warranties in the
merger agreement.”  Please revise your disclosure to remove the inappropriate limitations
on reliance on the representations and warranties contained  in the merger agreement,
which constitute disclosure under the federal securities laws.  For guidance, please refer
to Report of Investigation Pursuant to Section 21(a) of the Securities Exchange Act of
1934 and Commission Statement on potential Exchange Act Section 10(b) and Section
14(a) liability, Securities Exchange Act Release No. 51283 (March 1, 2005).

We urge all persons who are responsible for the accuracy and adequacy of the disclosure
in the filing to be certain that the filing includes the information the Securities Act of 193 3 and
all applicable Securities  Act rules require.   Since the company and its management are in
possession of all facts relating to a company’s disclosure, they are responsible for the accuracy
and adequacy of the disclosur es they have made.

Notwithstanding our comments, in the event you request acceleration of the effective date
of the pending registration statement , please provide a written statement from the company
acknowledging that:

 should the Commission or the staff, acting pursuant to delegated authority, declare the
filing effective, it does not foreclose the Commission from taking any action with respect
to the filing;

 the action of the Commission or the staff, acting pursuant t o delegated authority, in
declaring the filing effective, does not relieve the company from its full responsibility for
the adequacy and accuracy of the disclosure in the filing; and

Curtis C. Simard
Bar Harbor Bankshares
August 5, 2016
Page 3

  the company may not assert staff comments and the declaration of effect iveness as a
defense in any proceeding initiated by the Commission or any person under the federal
securities laws of the United States.

Please refer to Rules 460 and 461 regarding requests for  acceleration .  We will consider a
written request for acceleration of the effective date of the registration statement as confirmation
of the fact that those requesting acceleration are aware of their respective responsibilities under
the Securities Act of 1933 and the Securities Exchange Act of 1934 as they relate to the proposed
public offering of the securities specified in the above registration statement.  Please allow
adequate time  for us to review any amendment prior to the requested effective date of the
registration statement.

Please contact David Lin at (202) 551 -3552  or me at (202) 551 -3338  with any questions.

Sincerely,

 /s/ Dietrich A. King

Dietrich A. King
Assistant Director
Office of Financial Services

cc: Stephen L. Palmer, Esq.

September 23, 2014

Via E -mail
Mr. Gerald Shencavitz
Bar Harbor Bankshares
P.O. Box 400
82 Main Street
Bar Harbor, ME 04609 -0400

Re: Bar Harbor Bankshares
Form 10-K for the Fiscal Year  Ended December 31, 2013
Filed March 13, 2014
File No. 001-13349

Dear Mr. Shencavitz :

We have completed our review of your filing .  We remind you that our comments or
changes to disclosure in response to our comments do not foreclose the Commission from taking
any action with respect to the company or the filing and the company may not assert staff
comments as a defense in any proceeding initiated by the Commission or any person under the
federal securities laws of the United States.  We urge all persons who are responsible for the
accuracy and adequacy of the disclosure in the filing to be certain that the filing include s the
information the Securities Exchange Act of 1934 and all applicable rules require.

Sincerely,

 /s/ Paul Cline

            Paul Cline
Staff Accoun tant

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CORRESP

 September 22, 2014

Correspondence filed via EDGAR

 Mr. Paul Cline

Staff Accountant

 United States Securities and Exchange
Commission

 Washington, D.C. 20549

Re:
Bar Harbor Bankshares

Form 10-K for the Fiscal Year Ended December 31, 2013

Filed March 13, 2014

File No. 001-13349

 Dear Mr. Cline:

On behalf of Bar Harbor Bankshares (the “Company”), this letter is in response to your comment letter dated September 2, 2014 related to the
staff’s review of the above-referenced Form 10-K filing. Set forth below are the staff’s comments in bold italics followed by the Company’s responses to the staff’s comments:

Item 15. Exhibits, Financial Statements Schedules

Exhibit 23 —Consent of Independent Registered Public Accounting Firm

Comment: We have reviewed your response to comments 1 and 2. Please amend your filings to include the independent accounting
firm’s opinions dated March 13, 2014 and expand the related disclosure to state that in conducting the 2013 audit of the company’s internal controls over financial reporting the COSO 1992 framework was used.

Response: As requested, we have amended our Form 10-K filing to include the independent accounting firms opinion with a corrected date of
March 13, 2014. We also expanded the related disclosure to state that in conducting the 2013 audit of the company’s internal controls over financial reporting the COSO 1992 framework was used. On September 17, 2014, we filed a FORM
10-K/A (Amendment No. 1) (File No. 001-13349) incorporating the foregoing changes.

 The Company acknowledges that:

•

The Company is responsible for the adequacy and accuracy of the disclosure in the filing;

•

Staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filing; and

•

The Company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

Should you have any questions concerning the above responses, please do not hesitate to contact me at (207) 288-2638.

Respectfully submitted,

 /s/ Gerald Shencavitz

Gerald Shencavitz

 EVP, Chief Financial Officer &
Principal Accounting Officer

September 2, 2014

Via E -mail
Mr. Gerald Shencavitz
Bar Harbor Bankshares
P.O. Box 400
82 Main Street
Bar Harbor, ME 04609 -0400

Re: Bar Harbor Bankshares
Form 10-K for the Fiscal Year Ended December 31, 2013
Filed March 13, 2014
Response dated August 26, 2014
  File No. 001 -13349

Dear Mr. Shencavitz :

We have reviewed your supplemental response  and have the following comment .  In our
comment , we may ask you to provide us with information so we may better understand your
disclosure.

Please respond to this letter within ten business days by amending your filing, by
providing the requested information, or by advising us when you will provide the requested
response.   If yo u do not believe our comment applies to your facts and circumstances or do not
believe an amendment is appropriate, please tell us why in your response.

After reviewing any amendment to your filing and the information you provide in
response to this comment , we may have  additional comments.

Item 15. Exhibits, Financial Statement Schedules

Exhibit 23 – Consent of Independent Registered Public Accounting Firm

1. We have reviewed your response to comments 1 and 2. Please amend your filing to
include t he independent accounting firm ’s opinion s dated March 13, 2014 and expand the
related disclosure to state that in conducting the 2013 audit of the company’s internal
controls over financial reporting the COSO 1992 framework was used.

Mr. Gerald Shencavitz
Bar Harbor Bankshares
September 2, 2014
Page 2

 You may contact Chris Harley  at (202) 551 -3695  or me at (202) 551 -3851  if you have
questions regarding  our comment  on the financial statements and related matters.

Sincerely,

 /s/  Paul Cline

            Paul Cline
Staff Accountant

CORRESP
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April 15, 2011

August 26, 2014

Correspondence filed via EDGAR

Mr. Paul Cline

Staff Accountant

United States Securities and Exchange Commission

Washington, D.C. 20549

Re:

Bar Harbor Bankshares

Form 10-K for the Fiscal Year Ended December 31, 2013

Filed March 13, 2014

File No. 1-13349

Dear Mr. Cline:

On behalf of Bar Harbor Bankshares (the “Company”), this letter is in response to your comment letter dated August 14, 2014 related to the staff’s review of the above-referenced Form 10-K filing.  Set forth below are the staff’s comments in bold italics followed by the Company’s responses to the staff’s comments:

Item 8. Financial Statements and Supplementary Data

Reports of Independent Registered Public Accounting Firm

Comment: Please tell us which version of the Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) was used in conducting the audit of the Company’s internal controls over financial reporting.

Response: In conducting the 2013 audit of the Company’s internal controls over financial reporting the COSO 1992 framework was used. The Company will be adopting the COSO 2013 framework in 2014.

Item 15. Exhibits, Financial Statements Schedules

Exhibit 23 – Consent of Independent Registered Public Accounting Firm

Comment: Please file a new consent of the independent registered public accounting firm to correctly refer to the reports dated March 12, 2014.

Response: The consent letter of March 13, 2014 was correctly dated. As presented in the Form 10-K, the reports of the independent registered public accounting firm were incorrectly dated March 12, 2014. These should have been dated March 13, 2014. However, please note that the actual signed documents from the independent registered

accountants were all dated March 13, 2014. This inadvertent error occurred as a result of a late decision to move our originally anticipated filing date by one day.

************

The Company acknowledges that:

·

The Company is responsible for the adequacy and accuracy of the disclosure in the filing;

·

Staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filing; and

·

The Company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

Should you have any questions concerning the above responses, please do not hesitate to call me at (207) 288-2638.

Respectfully submitted,

/s/Gerald Shencavitz

Gerald Shencavitz

EVP & Chief Financial Officer

August 14, 2014

Via E -mail
Mr. Gerald Shencavitz
Chief Financial Officer
Bar Harbor Bankshares
P.O. Box  400
82 Main Street
Bar Harbor, ME 04609 -0400

Re: Bar Harbor Bankshares
Form 10-K for Fiscal Year  Ended December  31, 2013
Filed March 13, 2014
  File No. 001 -13349

Dear Mr. Shencavitz :

We have reviewed your filing an d have the following comments.  In some of our
comments, we may ask you to provide us with information so we may better understand your
disclosure.

Please respond to this letter within ten business days by amending your filing, by
providing the requested information, or by advising us when you will provide the requested
response.   If you do not believe our comments apply to your facts and circumstances or do not
believe an amendment is appropriate, please tell us why in your response.

After reviewing any amendment to your filing and the information you provide in
response to these comments, we may have  additional comments.

Item 8. Financial Statements and Supplementary Data , page 11

Reports of Independent Registered Public Accounting Firm , page 11

1. Please tell us which version of the Internal Control – Integrated Fr amework issued
by the Committee of Sponsoring Organizations of the Treadway Commission
(COSO) was used in conducting the audit of the company’s internal controls over
financial reporting.

Mr. Gerald Shencavitz
Bar Harbor Bankshares
August 14, 2014
Page 2

Item 15. Exhibits, Financial Statements Schedules , page 30

Exhibi t 23 - Consent of Independent Registered Public Accounting Firm

2. Please file a new consent of the independent registered public accounting firm to
correctly refer to the reports dated March 12, 2014.

             We urge all persons who are responsible f or the accuracy and adequacy of the disclosure
in the filing to be certain that the filing includes the information the Securities Exchange Act of
1934 and all applicable Exchange Act rules require.   Since the company and its management are
in possession o f all facts relating to a company’s disclosure, they are responsible for the accuracy
and adequacy of the disclosures they have made.

            In responding to our comments, please provide  a written statement from the company
acknowledging that:

 the company is responsible for the adequacy and accuracy of the disclosure in the filing;

 staff comments or changes to disclosure in response to staff comments do not foreclose
the Commission from taking any action with respect to the filing; and

 the company may not assert staff comments as a defense in any proceeding initiated by
the Commission or any person under the federal securities laws of the United States.

You may contact Chris Harley  at (202) 551 -3695  or me at (202) 551 -3851  if you have
questions regarding comments on the financial statements and related matters.

Sincerely,

 /s/ Paul Cline

Paul Cline
Staff Accountant

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 DIVISION OF
  CORPORATION FINANCE

January 4, 2012
  Via Email

Joseph M. Murphy President and Chief Executive Officer  Bar Harbor Bankshares   82 Main Street, P.O. Box 400   Bar Harbor, Maine 04609
Re: Bar Harbor Bankshares
 Form 10-K for the Fiscal Year Ended December 31, 2010   Filed March 16, 2011    File No.  1-13349

Dear Mr. Murphy:

We have completed our review of your filings. We remind you that our comments
or changes to disclosure in response to our comments do not for eclose the Commission
from taking any action with respect to the company or the filings and the company may
not assert staff comments as a defense in any proceeding initiate d by the Commission or
any person under the federal securities laws of the United States. We urge all persons
who are responsible for the accuracy and adequacy  of the disclosure in the filings to be
certain that the filings incl ude the information the Securities Exchange Act of 1934 and
all applicable rules require.

Sincerely,

       /s/ John P. Nolan          John P. Nolan         Senior Assistant Chief Accountant

CORRESP
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SEC Final Letter 15 November 2011

November 15, 2011

Correspondence filed via EDGAR and overnight delivery

John P. Nolan

Senior Assistant Chief Accountant

United States Securities and Exchange Commission

Division of Corporation Finance

100 F. Street, N.E.

Washington, D.C. 20549-4561

Re:    Bar Harbor Bankshares

            Form 10-K for the
Fiscal Year Ended December 31, 2010

            Filed March 16, 2011

            Form 10-Q for the
Quarter Ended March 31, 2011

            Filed May 10, 2011

    Form 10-Q for the Quarter Ended June 30, 2011

            Filed August 8, 2011

            File No. 1-13349

Dear Mr. Nolan:

On behalf of Bar Harbor Bankshares (the "Company"), this letter is in
response to your comment letter dated November 2, 2011 related to the staff’s review
of the above-referenced Form 10-K and 10-Q filings. Set forth below are the staff’s
comments in bold italics followed by the Company’s responses to the staff’s
comments (numbers, unless otherwise stated, are presented in thousands):

Form 10-Q for Fiscal Quarter Ended June 30, 2011

Management’s Discussion and Analysis of Financial Condition and
Results of Operations

Nonperforming Loans

Comment: Tell us whether the loans were repaid in August of 2011 or were extended
addressing the nature and terms of the extension.

Response: The loans were neither repaid nor extended. They both matured in August
as scheduled. The loan is currently in default and no terms of the loan have been changed.
The Bank currently intends to permit the not-for-profit borrower to retain possession and
sell off the finished houses. The Bank receives 100% of the net sales proceeds from each
home sale. As of this writing, one house has sold, resulting in a $279 payment of
principal, and another house is under contract at a sales price of $188. Both sales prices
support the recently-obtained appraised value of the project.

John P. Nolan

Senior Assistant Chief Accountant

United States Securities and Exchange Commission

November 15, 2011

Page 2

Comment: If loan extensions were made, tell us how management determined there was
sufficient collateral to support repayment of the loans taking into consideration the
amount and timing of previous housing unit sales and the net proceeds received as well as
economic and other conditions affecting sales. Further, address whether the company
expects to be repaid during the extension period or whether the company would continue to
enter into additional loan extensions until repayment has occurred.

Response: The loans were not extended.

Comment: The collateral analysis should also address the number and amount of
affordability covenants (i.e. as well as define) the borrower has for sale as well as
other real estate available for sale for which the company has the guaranteed right to
receive the proceeds from these sales;

Response: Although technically this question does not apply because we did not
extend the loans in August, we note that these various elements were all considerations
throughout 2011 as this borrower worked with the Bank on a repayment plan. The elements
were reviewed by management and incorporated into discounted cash flow analyses prepared
by the Bank during 2011, with amounts ascribed based upon the facts at the time, and
reasonable management assumptions around absorption and timing. And, as explained further
below, as of September 30, 2011, the Bank considered the loans collateral dependent and no
longer is relying on additional sales of affordability covenants.

Comment: Provide us with details of your specific loan loss allowance for the
nine months ended September 30, 2011. It may be appropriate to provide a table or
reconciliation, along with an accompanying textual discussion which highlights any
significant triggering events or other useful information to understand how changes in the
asset quality/performance of this loan was considered during this time period.

Response

Facts and Circumstances Prior to December 31, 2010

To help you understand how negotiations unfolded with this borrower leading up to
December 31, 2010, and through the current date, and explanation of some key factors is
necessary. The borrower, a not-for-profit housing agency, conceived and constructed a
31-unit development to provide affordable housing to local residents. In addition to the
Bank’s financing, the borrower obtained a $1,000 grant from the municipality in
support of the project. This grant was approved by a vote of the local residents. The
Bank’s participation in the project was motivated in large part by the Community
Reinvestment Act implications of lending to this project that supported housing in a
location where a need for affordable housing existed. Due to some minor changes to the
project, the town believed that it needed to have another vote of the local residents to
grant

John P. Nolan

Senior Assistant Chief Accountant

United States Securities and Exchange Commission

November 15, 2011

Page 3

the $1,000. In the second vote, the local residents rejected the grant. This took place
in the second quarter of 2010. At that time, the loan was downgraded by the Bank to
substandard.

After the local residents rejected the town’s grant, the Bank had meetings with
the borrower to discuss a repayment plan for the project. Home sales had remained active
through the end of 2009, so there was not a concern at that time over the project itself,
but the absence of the grant from the town brought into question the feasibility of
keeping it in the status of an affordable housing project. The borrower provided several
conceptual proposals for generating additional cash flow involving other assets that it
was able to sell. One was to sell a real estate asset that it owned which sold in December
of 2010. The proceeds from this sale were used to pay down the loan to the Bank. Another
involved the existing fourteen homeowners in the project, who had purchased their homes
under so-called "affordability covenants" (covenants which permitted the
homeowners to pay less for their home in exchange for the borrower retaining ownership of
the land). The borrower’s idea was to see if these homeowners were interested in
paying a sum in exchange for releasing them from these affordability covenants. Another
proposal related to a prior housing project that the borrower had developed under a
similar methodology, and the borrower thought that it could perhaps offer homeowners in
that project a chance to purchase their affordability covenants. This prior development
had over 20 houses and thus that number of potential affordability covenant sales. These
ideas were considered in the third and fourth quarter of 2010, and required the borrower
to propose them before its board of directors. Additionally, there was some legal work
required to ensure that the different options were permitted.

Leading up to December 31, 2010, the borrower had internally approved the ideas
outlined above. However, as of December 31, 2010 there were myriad variables associated
with them. Those included how many eligible homeowners would be interested in paying to
obtain clear title to their land, what price the covenants would sell for, how to document
the transactions and an issue relating to the prior housing project, which used a $250
grant for its original development. That $250 grant had been awarded by a state agency
because the project was going to support affordable housing. As of December 31, 2010 the
borrower was going to ask the granting agency if it would accept a partial pro-rata
repayment of the grant for each homeowner that exercised the affordability covenant
option. The Bank’s assumption at this time was that this request would be accepted by
the granting agency. Due to continued uncertainty surrounding the repayment of this loan,
the Bank placed the loan on nonaccrual status in the fourth quarter of 2010.

December 31, 2010

At December 31, 2010, the loan balance was $5,194, the Bank’s internal discounted
cash flow reflected a net present value of $4,683 and the Bank had a specific loan loss
allowance or $577 against the subject loans. This net present value incorporated the
Bank’s best estimates associated with the housing units financed, affordability
covenants on houses already sold, and

John P. Nolan

Senior Assistant Chief Accountant

United States Securities and Exchange Commission

November 15, 2011

Page 4

affordability covenants on the prior affordable housing project. At that time, the
economics of the affordability covenants – which essentially permitted the homeowners
to purchase their land for a favorable price – warranted an assumption that a large
percentage of those eligible for the program would exercise the option.

March 31, 2011

At March 31, 2011, the loan balance was $5,194, the Bank’s internal discounted
cash flow reflected a net present value of $4,386 and the Bank had a specific loan loss
allowance of $850 against the loans. There were two key changes from the prior quarter in
the discounted cash flow analysis. First, the number of affordability covenants
anticipated to be sold was reduced, reflecting letters of intent obtained from eligible
homeowners. The second factor related to affordability covenants in the prior project.
During the quarter ended March 31, 2011, the state agency notified the borrower that it
would require payment in full of the $250 if any affordability covenants were sold.
This implied that there had to be a minimum number of sales for the program to generate
economic benefit to the borrower.

June 30, 2011

At June 30, 2011, the loan balance was $5,090, the Bank’s internal discounted cash
flow reflected a net present value of $3,890 and the Bank had a specific loan loss
allowance of $1,200 against the loans. The key changes during the quarter reflected a
meeting that the borrower had with residents of the prior housing project. As a result of
that meeting, the potential sales price of those affordability covenants was reduced to
$50 from the $75 that had been previously estimated. Also, based on the turnout and
interest level of the residents in attendance, the assumption regarding the number of
residents likely to exercise this option was reduced to seven from ten.

September 30, 2011

As of September 30, 2011, the loans were written down to a carrying value of $3,218, an
amount determined as fair value per an appraisal dated September 9, 2011. During the
quarter, the primary real estate selling season in the market area for this project
expired with no additional home sales closed (but two were placed under contract in
September). Additionally, management of the borrower was unable to generate any more
meaningful affordability covenant sales. As a result of the lack of house and
affordability covenant sales, the Bank determined during the third quarter that the loans
were collateral dependent and estimated the fair value of the subject collateral to
determine a specific loan loss allowance. The Bank then decided to write off the
difference between the fair value of the subject collateral and the outstanding loan
balance. Although there remain possibilities for sales from affordability covenants,
management determined that the magnitude and the likelihood of such sales no longer
warranted discounted cash flow consideration.

John P. Nolan

Senior Assistant Chief Accountant

United States Securities and Exchange Commission

November 15, 2011

Page 5

Comment: Tell us whether the company is continuing to accrue interest income
on these loans.

Response: As disclosed in the December 31, 2010 SEC Form 10-K, and each subsequent
SEC Form 10-Q, these loans are classified as nonaccrual. As such, these loans are no
longer accruing interest.

Comment: Tell us why the current remaining outstanding aggregate loan balance does
not seem to be reflective of the principal payments received during the timeframe in which
these loans have been outstanding.

Response: In accordance with the legal documents, the Bank was funding necessary
construction costs throughout the project’s life, including work necessary to
complete units for sale. Thus, during the period of sales activity through year end 2010,
there were additional line borrowings that in some cases offset the principal reductions.
This reflected the fact that costs needed to be funded throughout the project’s life
cycle, and the non-profit borrower’s reliance on bank financing to fund those costs
(as was permitted under the loan documentation). The more significant impediment to a
larger principal paydown was the failure of the municipality to pay a $1,000 payment to
the borrower in support of the project, as was contemplated in the original underwriting.

* * * *

The Company acknowledges that:

  The Company is responsible for the adequacy and accuracy of the disclosure in the
    filing;

  Staff comments or changes to disclosure in response to staff comments do not foreclose
    the Commission from taking any action with respect to the filing; and

  The Company may not assert staff comments as a defense in any proceeding initiated by
    the Commission or any person under the federal securities laws of the United States.

Should you have any questions concerning the above responses, please do not hesitate to
call me at (207) 288-9343.

Respectfully submitted,

 /s/Joseph M. Murphy

Joseph M. Murphy

President & CEO

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 DIVISION OF
  CORPORATION FINANCE

November 2, 2011
  Via Email

Joseph M. Murphy President and Chief Executive Officer  Bar Harbor Bankshares   82 Main Street, P.O. Box 400   Bar Harbor, Maine 04609
Re: Bar Harbor Bankshares
 Form 10-K for the Fiscal Year Ended December 31, 2010   Filed March 16, 2011    Form 10-Q for the Quarter Ended March 31, 2011
Filed May 10, 2011  Form 10-Q filed for the Quarter Ended June 30, 2011 Filed August 8, 2011 File No.  1-13349

Dear Mr. Murphy:

   We have reviewed your supplem ental response and have the following
comments. In some of our comments, we may ask you to provide us with information so
we may better understand your disclosure.
 Please respond to this letter within ten business days by amending your filing, by
providing the requested information, or by advising us when you will provide the requested response. If you do not believe  our comments apply to your facts and
circumstances or do not believe an amendment is appropriate, please tell us why in your
response.
 After reviewing any amendment to your filing and the information you provide in
response to these comments, we may have additional comments.
 Form 10-Q for the Quarter Ended June 30, 2011

 Management’s Discussion and Analysis of Fi nancial Condition and Results of Operations

Nonperforming Loans

Joseph M. Murphy
Bar Harbor Bankshares   November 2, 2011 Page 2
 1. The staff notes your response to prior co mment two in our letter dated June 21,
2010. Please address the following as it relates to the loan to th e local, non-profit
housing authority:
 Tell us whether the loans were repaid  in August of 2011 or were extended
addressing the nature and terms of the extensions;
 If loan extensions were made, tell us how management determined there was
sufficient collateral to support repa yment of the loans taking into
consideration the amount and timing of previous housing unit sales and the net
proceeds received as well as economic and other conditions affecting sales.
Further, address whether the compa ny expects to be repaid during the
extension period or whether the comp any would continue to enter into
additional loan extensions until repayment has occurred;
 The collateral analysis should also address the number and amount of
affordability covenants (i.e. as well as define) the borrower has for sale as well other real estate available for sale for which the company has the
guaranteed right to receive the pr oceeds from these sales;
 Provide us with details of your specifi c loan loss allowance for the nine
months ended September 30, 2011.  It may be  appropriate to provide a table or
reconciliation, along with an accompanying textual discussion which highlights any significant triggering ev ents or other useful information to
understand how changes in the asset qua lity/performance of this loan was
considered during this time period;
 Tell us whether the company is continui ng to accrue interest income on these
loans; and
 Tell us why the current remaining outst anding aggregate loan balance does
not seem to be reflective of the principal payments received during the timeframe in which these loans have been outstanding.

* * * *

 You may contact Marc Thomas, Staff Accountant, at (202)  551-3452 or me at
(202) 551-3492 if you have any questions regarding the above comments.

Sincerely,
           /s/ John P. Nolan         John P. Nolan         Senior Assistant Chief Accountant

CORRESP
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CORRESPONDENCE

July 28, 2011

Correspondence filed via EDGAR and overnight delivery

Marc Thomas

Staff Accountant

United States Securities and Exchange Commission

Division of Corporation Finance

100 F. Street, N.E.

Washington, D.C. 20549-4561

    Re:

    Bar Harbor Bankshares

Form 10-K for the Fiscal Year Ended December 31, 2010- Filed March 16, 2011

Form 10-Q for the Quarter Ended March 31, 2011 -Filed May 10, 2011

File No. 1-13349

Dear Mr. Thomas:

On behalf of Bar Harbor Bankshares (the “Company”), this letter is in response to your comment
letter dated June 21, 2011, including responses to subsequent requests communicated during our
phone conversations on July 13 and 14, 2011 (“Telephone Comments”). Set forth below are the
staff’s comments in bold italics followed by the Company’s responses to the staff’s comments:

Form 10-Q for Fiscal Quarter Ended March 31, 2011

Note 4: Securities Available for Sale

    1.

    Please provide us your full detailed securities impairment analysis, as of both December 31,
2010 and March 31, 2011, for the private label mortgage-backed securities. The analysis should
address all available evidence, explains the relative significance of each piece of evidence,
and identifies the primary evidence on which you rely to support a realizable value equal to
or greater than the carrying value of the investment.

Response: Please refer to our preliminary letter to you dated July 5, 2011 in response to this
comment, a copy of which is attached to this letter as Exhibit A.

Telephone Comment: Please provide us with a list of your private-label MBS that were in unrealized
loss positions as of 12/31/10 and 3/31/11.

Response: Please refer to the attached Exhibits B and C for the information requested.

Telephone Comment: Please describe the detailed steps taken following the end of each reporting
period to determine whether any of the Company’s private label MBS are other-than-temporarily
impaired and, if so, the amount of OTTI that should be recorded.

Marc Thomas

Staff Accountant

United States Securities and Exchange Commission

July 28, 2011

Page 2

Response: At March 31, 2011, the Company owned sixty-six private-label mortgage-backed securities
with a total amortized cost of $19.6 million and an estimated fair value of $17.8 million,
amounting to a net unrealized pre-tax loss of $1.9 million, or 9.6%.

Following the end of each reporting period, the Company identifies all private-label MBS with an
unrealized loss position greater than 20% and all securities rated by the major credit rating
agencies as below investment grade. At March 31, 2011, thirty-four such securities were identified.
These securities were then subjected to a detailed OTTI evaluation using the data base information
and future cash flow (i.e. loss modeling) tools provided by Bloomberg.

Management’s best estimate of credit losses (or lack thereof) inherent in the securities is based
on discounted, bond-specific future cash flow projections using assumptions about cash flows
associated with the pools of mortgage loans underlying each security. In estimating those cash
flows the Company takes a variety of factors into consideration including, but not limited to, loan
level credit characteristics, current and historical delinquency and non-performing loan rates,
current levels of subordination and credit support, original and current loan to value ratios,
borrower FICO scores, and the geographical distribution of the underlying collateral. All of the
foregoing information is provided by Bloomberg (e.g. CLP, MTCS, CLC, DES, etc.).

The Company then reviews recent and historical constant default rates (“CDR”), recent and
historical loss severities (“SEV”) and recent and historical conditional pre-payment speeds
(“CPR”). All of the foregoing information is provided by Bloomberg (e.g. SEV, YTR, etc).

Using all of the foregoing information, the Company estimates the most likely future constant
default rates, loss severities and conditional prepayment speeds. These best estimates typically
reflect the most recent performance of the underlying collateral with respect to these three
considerations (using 1, 3, 6, and 12 month experience), as well as the current credit
characteristics of the underlying collateral including delinquencies, and other best estimates of
future collateral performance.

Using the Bloomberg Structure Pay-down software application (SPA), the Company enters its best
estimates for future CDR’s, SEV’s and CPR’s. The application then generates expected future cash
flows using this information, including the existence and percentage of any future credit losses
(i.e. OTTI), as well as the timeframe in which those losses are expected to occur.

Despite some elevated levels of delinquencies, defaults and losses in the underlying residential
mortgage loan collateral, given credit enhancements resulting from the structures of the individual
securities, the Company expects that it will recover the amortized cost basis of its private-label
mortgage-backed securities and had therefore concluded that such securities were not
other-than-temporarily impaired as of March 31, 2011 and December 31, 2010. Nevertheless, given
uncertain market conditions, it is possible that adverse changes in repayment performance and fair
value could occur in future periods that could impact the Company’s then current best estimates.

Marc Thomas

Staff Accountant

United States Securities and Exchange Commission

July 28, 2011

Page 3

Telephone Comment: For the five securities listed below that had no OTTI recorded in the first
quarter of 2011, please address the reasons why no OTTI was taken and the steps used to make that
determination.

Response: Please note that the steps taken to determine the existence of OTTI for the five
securities in question were the same as those outlined in our response to the previous comment.

The primary reasons why no OTTI was taken on the five subject securities are summarized below:

GSR 2004-9 3A2

Book Value — $568,512

Par Value — $609,605

These are variable rate 30 year mortgages with a current borrower rate of 3.16%. The security is
rated Aa3 (Moody’s) and AAA (Fitch). These loans were originated in July 2004 (pre-bubble) and had
an LTV ratio of 59.75%. The current LTV increased to 63.22%, suggesting the borrowers still have
plenty of equity in their homes. Since 2004, 87% of this pool has paid down, with cumulative credit
losses of only 0.49% that were covered with the credit support built into the structure. The
original credit support was 4.15%, but has since increased to 11.91%. The collateral has been
showing four delinquent loans over 90 days dating back to early 2010. There have been no new 30 or
60 day delinquencies since July 2010.

We modeled future cash flows using a CDR of 1.5%, based on the strength of the collateral,
including recent and historical performance. We used a CPR of 6%, which is relatively slow but
consistent with historical and recent performance. For loss severity we used 40% based on
historical experience and in consideration of the current LTV’s of 63.22%. These inputs resulted in
a credit loss of $12,670, with the first loss occurring in 2031 and extending out to 2034. No OTTI
was taken on this security given that book value was less than the par value by $41,093.

We alternatively modeled this security using a CDR of 1, a CPR of 4, and a SEV of 60. There was no
OTTI using these alternative inputs.

CWL 2002-S2 A5

Book Value — $685,513

Par Value — $685,557

This is a pool of fixed rate, closed-end home equity loans that were originated in 2002. The
highest collateral concentration is in Texas at 37%, and only 5% in California. Since origination,
87% of the pool has been paid down. The security is rated AAA by both Moody’s and S&P. The original
LTV’s were 17.39% and the current LTV’s are 10.68%, indicating the borrowers have sufficient equity
in their homes. This security has had no historical losses, which appears reflective of the
borrower equity positions. The collateral has been consistently performing well with loans
delinquent 60+ at 0.66%, and 30 day delinquencies at 0.30%. The original credit support was 6.75%,
but has since climbed to 13.5%.

Marc Thomas

Staff Accountant

United States Securities and Exchange Commission

July 28, 2011

Page 4

The payment speeds on this pool have been running steady at about 15. The CDR’s have been averaging
about 2.5%, but without any losses being incurred, presumably because of strong equity positions.
Because of the strength of the underlying collateral, we heavily stress tested future cash flows
using a CPR of only 6, a CDR of 5, and a SEV of 60. These inputs resulted in no future credit
losses.

CSMC 2007-7 3A2

Current book value: $677,148

Current Par Value: $699,236

This is a small pool of fifty-four, 15 year mortgages with 53 months of seasoning and equity build.
Borrowers with 15 year mortgages are typically more financially stable than 30 year borrowers.
Consistent with this assumption, the original LTV’s on this pool were 50.52%, but have since
climbed to 69.55%. Since these loans were originated, there have been no losses. The collateral has
been performing well with the last new delinquency dating back to May 2010. Currently, there are
only two delinquent loans in the pool, both of which are over 90 days. All other loans are current.
The original credit support on this pool was 5.38%, but has since declined to 3.17%.

We modeled expected future cash flows using a CPR of 12 which essentially mirrored the previous 12
month average. Having little historical loss severity data (one loan at 29.32% in November 2010) we
used an SEV of 43, which gave some consideration to the apparent strong equity positions. With
respect to CDR, we determined that based on the small pool of steadily performing loans, it was
appropriate to use a vector. Specifically, we modeled a CDR of 5 for one month (in consideration of
the two delinquent loans), and then used a 1.1 CDR until maturity. These inputs resulted in a
future credit loss of $21,657, with the first loss occurring in October 2017 and continuing through
July 2022.

No OTTI was taken on this security given that book value was less than the par value by $22,088.

BOAMS 2005-J 3A2

Book Value $439,375

Par Value: $456,374

This is a small pool of sixty-one 30 year mortgages with 66 months of seasoning. Since 2005, 55% of
this pool has been paid with cumulative losses of 1.43%. The security is credit rated B (Fitch) and
C (Moody’s). The original credit support for this pool was 3.90%, but has since increased to 4.83%.
The original LTV for these loans was 70.7%, but has since increased to 88.3%. The collateral has
been performing reasonably well, with 90+ day delinquencies holding steady between 7% and 8% (30
day delinquents were 1.69% whereas 60 day delinquents were 1.82%).

Marc Thomas

Staff Accountant

United States Securities and Exchange Commission

July 28, 2011

Page 5

We modeled expected future cash flows using a CPR of 24, compared with the prior six month average
of 26.3 and a current month speed of 28.9. For CDR we used 4.8 until maturity. This was higher than
the 3 month experience (4.56) but consistent with the 6 and 12 month experience (4.77 and 4.97). We
also gave consideration to the low delinquencies in the 30 and 60 day categories. For SEV we used
40% which was consistent with recent and historical experience. These inputs resulted in an
estimated future credit loss of $11,642, with the first loss occurring in August 2018 and the last
loss in August 2020.

No OTTI was taken on this security given that book value was less than the par value by $16,999.

CWHL 2008-3R 1A2

Book Value: $746,874

Par Value: $1,054,905

This is a private placement MBS, which is not rated by the major credit rating agencies, making the
security more illiquid in the marketplace. The collateral consists of 30-year mortgages with 47
months of seasoning. Since origination, 50% of this pool has paid down with no cumulative losses.
While borrower FICO scores were 742 at origination with LTV’s at 70.7%, forty-one percent of the
collateral is in California. The Collateral was currently showing 90+ day delinquencies of 15.6%,
however, 60 day delinquencies were at 0.93% and 30 day delinquencies at 2.25%.

We modeled expected future cash flows using a CPR of 21, which approximated the prior six month
average. We used a CDR of 3.7 to maturity, which was higher than all current and historical
averages, but gave consideration to the delinquency status of the underlying loans. We used a 45
for SEV, which was higher than the 3, 6 and 12 month averages. The foregoing inputs resulted in an
estimated future credit loss of $299,400, with the first loss occurring in August 2010 and the last
loss in May 2016.

No OTTI was taken on this security given that book value was less than the par value by $308,031.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Nonperforming Loans

Marc Thomas

Staff Accountant

United States Securities and Exchange Commission

July 28, 2011

Page 6

2. We note your response to comment one in our letter dated April 6, 2011. In order for us to more
clearly understand the nature, terms, collateral and any specific allowance for loan loss recorded
on this specific loan, please address the following:

Comment: Tell us the original loan terms and indicate whether the terms have ever been modified.

Response: The original loan terms were outlined in item one of our initial response letter dated
April 19, 2011, to your comment letter dated April 6, 2011.

By way of further explanation, a $5 million loan to the Authority closed on August 28, 2007, and
matured on August 28, 2010. That note was extended for one year to August 28, 2011. A separate $1
million loan to the Authority was closed on August 18, 2008, and matured on August 28, 2010. That
note was extended to August 28, 2011. The extensions were requested and granted after the town
declined to provide an anticipated $1 million development grant, and they were intended to give the
Authority time to assess all of its repayment options, to reconsider the best means by which to
sell the remaining houses (i.e., as affordable units, as straight market value homes, or with the
option to do either). Other than these two extensions, no other loan terms have been modified from
the original documentation. Since the date of the second extension, the Authority has liquidated
ownership of another real estate asset, sold several affordability covenants in the subject project
and obtained a survey necessary to sell some additional covenants; however, no additional houses
have sold. The Authority has also determined a selling price and other details necessary to begin
selling affordability covenants in another project (as of the third quarter of this year).

Comment: Provide us with specific information detailing the nature of the loan, sources of
repayment, repayment history (i.e., from housing units and affordability covenants) to date as well
as management’s expectations regarding full repayment of the loan upon maturity in August 2011”

The loans funded the construction costs for a 31 unit affordable housing project conceived and
managed by the local not-for-profit Housing Authority. The original repayment sources included
housing sales and a $1 million bond issuance by the town. That bond issuance was rejected by the
town in 2010 after approval in a prior year. The bank receives 100% of the net proceeds from any
sale and applies the payments to outstanding principal. The bank received $2.1 million in
principal payments in 2008 (from housing unit sales), $836 thousand in 2009 (from housing unit
sales) and $422 thousand in 2010 (from housing unit sales). Interest in each of those years was
$169, $233 and $202 thousand, respectively. To date, f

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 DIVISION OF
  CORPORATION FINANCE

June 21, 2011
  Via Email

Joseph M. Murphy President and Chief Executive Officer  Bar Harbor Bankshares   82 Main Street, P.O. Box 400   Bar Harbor, Maine 04609
Re: Bar Harbor Bankshares
 Form 10-K for the Fiscal Year Ended December 31, 2010   Filed March 16, 2011    Form 10-Q for the Quarter Ended March 31, 2011
Filed May 10, 2011  File No.  1-13349

Dear Mr. Murphy:

We have reviewed your filing and have the following comments. In some of our
comments, we may ask you to provide us w ith information so we may better understand
your disclosure.
Please respond to this letter within ten business days by amending your filing, by
providing the requested information, or by advising us when you will provide the requested response. If you do not believe  our comments apply to your facts and
circumstances or do not believe an amendment is appropriate, please tell us why in your
response.

After reviewing any amendment to your filing and the information you provide in
response to these comments, we ma y have additional comments
 Form 10-Q for Fiscal Quarter Ended March 31, 2011

Note 4: Securities Available for Sale

1. Please provide us your full detailed secu rities impairment analysis, as of both
December 31, 2010 and March 31, 2011, for the private label mortgage backed securities.  The analysis should address all availabl e evidence, explains the
relative significance of e ach piece of evidence, and identifies the primary

Joseph M. Murphy
Bar Harbor Bankshares   June 21, 2011   Page 2
 evidence on which you rely to support a real izable value equal to or greater than
the carrying value of the investment.
Management’s Discussion and Analysis of Fi nancial Condition and Results of Operations

Nonperforming Loans
2. We note your response to comment one in our letter dated April 6, 2011.  In order
for us to more clearly unde rstand the nature, terms, collateral and any specific
allowance for loan loss recorded on this  specific loan, please address the
following:
 Tell us the original loan terms and indicate whether the terms have ever been
modified;
 Provide us with specific information deta iling the nature of the loan, sources of
repayment, repayment history (i.e. from housing units and affordability
covenants) to date as well as management ’s expectations regarding full repayment
of the loan upon maturity in August 2011;
 Regarding the repayment history, address the total number of housing units in the
project, how may units have been sold to  date and at what prices, the number of
affordability covenants sold as well as the related sales prices; and
 Provide us with details re garding the specific loss allo wances which have been
recorded and how these amounts have been determined at both December 31,
2011 and at March 31, 2011.
* * * *

We urge all persons who are responsible for the accuracy and adequacy of the
disclosure in the filing to be certain that the filing includes the information the Securities Act
of 1933 and all applicable Securities Act rules require. Since the company and its
management are in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy and adequacy of the disclosures they have made.

 You may contact Marc Thomas, Staff Accountant, at (202)  551-3452 or me at
(202) 551-3492 if you have any questions regarding the above comments.

Sincerely,
        /s/ John P. Nolan         John P. Nolan         Sr Asst. Chief Accountant

CORRESP
1
filename1.htm

BHB Form 10-K Review Response May 2011

BY FAX AND EDGAR

April 19, 2011

John P. Nolan

Sr. Asst. Chief Accountant

United States Securities and Exchange Commission

Division of Corporation Finance

100 F. Street, N.E.

Washington, D.C. 20549-4561

Re: Bar Harbor Bankshares

        Form 10-K for the Fiscal Year Ended December
31, 2010

        File No. 1-13349

Dear Mr. Nolan:

On behalf of Bar Harbor Bankshares (the "Company"), this letter is in
response to your comment letter dated April 6, 2011 related to the staff’s review of
the above-referenced Form 10-K filing. Set forth below are the staff’s comments in
bold italics followed by the Company’s responses to the staff’s comments.

    1.
    We note the significant increase in non-performing loans during fiscal
    2010 which was attributable to a $5,194 million commercial real estate development loan to
    a local, non-profit housing authority in support of an affordable housing project. So that
    the reader has a clear understanding of this lending relationship, please tell us and
    revise your future filings, to disclose the nature and terms of this loan including any
    associated guarantees. Since the loan is currently nonperforming you should address the
    viability of the project including the sources of repayment, current construction status,
    the underlying collateral and other pertinent information as well.

    The $5.194 million commercial real estate development loan to a local, non-profit
    housing authority in support of an affordable housing project pays monthly interest at the
    rate of 3.80% and matures in August of 2011. The loan is principally secured by the
    housing units from the project. There are no guarantees associated with this loan. The
    primary source of repayment is the sale of housing units, as well as the sale of certain
    affordability covenants associated with this project. Sales of both the housing units and
    the affordability covenants have continued during the past fifteen months and are expected
    to continue in the future. The project is fully constructed, and there is no further
    construction risk on the project. This loan is impaired and was put on non-accrual status
    during 2010. Based on our analysis of the present value of expected future cash flows, the
    Company established a specific reserve of $577,000 at December 31, 2010 on this loan. We
    will revise our future filings to include disclosures with additional information similar
    to above regarding this loan.

John P. Nolan

Sr. Asst. Chief Accountant

U.S. Securities and Exchange Commission

April 19, 2011

Page 2

    2.
    We note your portfolio segments and classes of financing receivables
    appear to be the same for purposes of providing the disclosures required by ASU 2010-20.
    Please tell us how you considered paragraphs 310-10-55-16 through 310-10-55-18 and
    310-10-55-22 when determining that further disaggregation of your portfolio segments was
    not necessary. For instance, it is unclear as to how you determined that there were not
    separate classes of financing receivables given that 33% of the total commercial real
    estate loans are to the lodging industry or the fact that you make construction loans that
    have different and unique characteristics and are included within the residential real
    estate mortgage loan portfolio segment.

    We acknowledge that our portfolio segments and classes of financing receivables are the
    same. In considering whether further disaggregation of our portfolio segments was
    necessary for purposes of determining our classes of financing receivables, we did
    consider the paragraphs you referenced above from ASU 2010-20. When determining what our
    classes should be in accordance with ASU 2010-20, we first considered categorization of
    borrowers and distinguished between commercial and consumer. We then disaggregated the
    commercial and consumer portfolios by type of financing receivables and type of collateral
    (i.e. real estate mortgages vs. non-real estate loans). Lastly, we disaggregated certain
    types of financing receivables (i.e. in the residential real estate class, we
    disaggregated home equity loans) and certain industry sectors (i.e. in the commercial and
    industrial and commercial real estate classes we disaggregated commercial construction and
    agriculture loans). Our loans are generally in the same geographic region, so there was no
    further disaggregation required with respect to geographic distribution. Based on the
    above consideration, we did not believe that further disaggregation from our portfolio
    segments were necessary in order to comply with ASU 2010-20.

    As mentioned above, our internal class-level distinctions within our commercial
    portfolio include disaggregating loans secured by real estate and those secured by
    non-real estate assets. Loans to the lodging industry are included within the commercial
    real estate class. We do not further disaggregate our commercial real estate class into a
    lodging class because these loans have similar risk characteristics to the rest of the
    commercial real estate class, despite the differing nature of the underlying collateral.
    Like the other loans in our commercial real estate class, these loans are generally
    underwritten to stable, mature and cash-flowing entities, and do not generally contain
    risks associated with new or start-up projects. Their success or failure is driven largely
    by the overall economy. We believe that the common reliance of borrowers in the commercial
    real estate class on general business risks, and not any real-estate specific risk, make
    further disaggregation unnecessary.

    The construction portfolio that is included in our residential real estate class totals
    $5.7 million. As this portfolio is not significant to our total loan portfolio or the
    residential real estate class, the Company does not believe that further disaggregation is
    necessary. As the construction portfolio increases in size, we will consider
    disaggregation in the future.

    3.
    We note that the effective date section of the summary of ASU 2010-20
    encourages, but does not require, comparative disclosure for earlier periods. We note you
    did not provide comparative information for many of your credit quality disclosures. To
    the extent the information required for comparative disclosure is reasonably available,
    please consider providing comparative footnote disclosure in all future filings
    considering the significant benefit this information provides investors and the objective
    of the ASL.

John P. Nolan

Sr. Asst. Chief Accountant

U.S. Securities and Exchange Commission

April 19, 2011

Page 3

    We will consider providing comparative footnote disclosure in all future filings to the
    extent the information is reasonably available.

    4.
    Please tell us and revise your disclosures in future filings to address
    the following:

      The policy for recording payments received on nonaccrual receivables
        in accordance with ASC 310-10-50-6(b);

      The policy for recognizing interest income on impaired loans,
        including how cash receipts are recorded in accordance with ASC 310-10-50-15(b); and

      The related amount of interest income recognized in accordance with
        ASC 310-10-50-15(c)(1).

    When a loan is classified as nonaccrual or impaired, any payments received are
    typically applied to reduce the principal balance of the loan. In situations where the
    Company reasonably believes there is no longer doubt regarding the ultimate collectability
    of principal on a nonaccrual or impaired loan, subsequent interest payments received are
    recorded as interest income on the cash basis in accordance with the contractual terms.

    For the years ended December 31, 2010, 2009 and 2008, the Company did not recognize any
    interest income on impaired loans using a cash-basis method of accounting during the time
    within those periods that the loans were impaired.

    We will revise our future filings to include these disclosures

    5.
    We note your disclosure on within Note 3 as it relates to "other
    assets especially mentioned" of loans which are considered to be within this specific
    classification due to a variety of factors. These factors may cause the loan officer to
    improperly supervise the credit due to a lack of expertise, inadequate loan agreement, the
    poor condition of or lack of control over collateral, failure to obtain proper loan
    documentation or any other possible situations or circumstances. Each of these factors
    disclosed would seem to be representative of a well defined weakness requiring
    classification within the "substandard" category. Please address as to why the
    current classification is appropriate. Further, tell us whether these loans as classified
    within this category are performing or nonperforming. You should also address how this
    particular internal risk rating relates to the likelihood of loss in accordance with ASC
    310-10-50-30.

    We believe the loans classified as "other assets especially mentioned" are
    appropriately classified as they do not contain any well-defined weaknesses that would
    require a substandard risk rating. As described in Note 3 to our consolidated financial
    statements included in our 2010 Form 10K, these loans have "potential
    weaknesses" that, "if left uncorrected, … may result in deterioration of
    the repayment prospects …. at some future date."

    All loans within this risk rating are performing. The Company’s policy requires
    any commercial loans in non-accrual status be rated substandard or doubtful.

    With respect to ASC 310-10-50-30, if potential weaknesses on loans classified as
    "other assets especially mentioned" are left uncorrected, there is a likelihood
    of loss. Based on historical experience, loans in this category have a higher likelihood
    of loss than "Pass" rated loans, and

John P. Nolan

Sr. Asst. Chief Accountant

U.S. Securities and Exchange Commission

April 19, 2011

Page 4

    therefore, a higher loss factor is assigned. However, as loans in this category exhibit
    potential weaknesses instead of well defined weaknesses, they have not reached the point
    where it is probable we will not receive all our principal and interest payments in
    accordance with contractual terms. As a result, these loans are not considered impaired.

* * * * *

The Company acknowledges that:

  The Company is responsible for the adequacy and accuracy of the disclosure in the
    filing;

  Staff comments or changes to disclosure in response to staff comments do not foreclose
    the Commission from taking any action with respect to the filing; and

  The Company may not assert staff comments as a defense in any proceeding initiated by
    the Commission or any person under the federal securities laws of the United States.

Should you have any questions concerning the above responses, please do not hesitate to
call me at (207) 288-9343.

Respectfully submitted,

 /s/Joseph M. Murphy

Joseph M. Murphy

President & CEO

Bar Harbor Bankshares

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 DIVISION OF
  CORPORATION FINANCE

April 6, 2011
   Joseph M. Murphy President and Chief Executive Officer  Bar Harbor Bankshares   82 Main Street, P.O. Box 400   Bar Harbor, Maine 04609
Re: Bar Harbor Bankshares
 Form 10-K for the Fiscal Year Ended December 31, 2010   Filed March 16, 2011
File No.  1-13349
 Dear Mr. Murphy:

We have reviewed your filing and have the following comments. In some of our
comments, we may ask you to provide us w ith information so we may better understand
your disclosure.

Please respond to this letter within ten business days by amending your filing, by
providing the requested information, or by advising us when you will provide the requested response. If you do not believe our comments apply to your facts and circumstances or do not believe an amendment is appropriate, please tell us why in your
response.
 After reviewing any amendment to your filing and the information you provide in
response to these comments, we ma y have additional comments
 Form 10-K for the Fiscal Year Ended December 31, 2010

Management’s Discussion and Analysis of Fi nancial Condition and Results of Operation

Summary Financial Results

1. We note the significant increase in n on-performing loans during fiscal 2010
which was attributable to a $5,194 million commercial real estate development
loan to a local, non-profit housing author ity in support of an affordable housing
project. So that the reader has a clear understanding of this lending relationship,
please tell us and revise your future filings, to disclose the nature and terms of this

Joseph M. Murphy
Bar Harbor Bankshares
April 6, 2011  Page 2
loan including any associated guarantees.  Since the loan is currently non-performing you should address th e viability of the projec t including the sources of
repayment, current construction status , the underlying collateral and other
pertinent information as well.
 Notes to Consolidated Financial Statements

 Note 3: Loans and Allowance for Loan Losses

2. We note your portfolio segments and classes of financing receivables appear to be
the same for purposes of providing th e disclosures required by ASU 2010-20.
Please tell us how you considered paragraphs 310-10-55-16 through 310-10-55-
18 and 310-10-55-22 when determining that  further disaggregation of your
portfolio segments was not necessary.  Fo r instance, it is unclear as to how you
determined that there were not separate cl asses of financing re ceivables given that
33% of the total commercial real estate loans are to the lodg ing industry or the
fact that you make construction loan s that have different and unique
characteristics and are included within the residential real estate mortgage loan portfolio segment.

3. We note that the effective date s ection of the summary of ASU 2010-20
encourages, but does not require, comparativ e disclosure for earlier periods.  We
note you did not provide comp arative information for many of your credit quality
disclosures. To the extent the informati on required for comparat ive disclosure is
reasonably available, please consider providing comparative footnote disclosure
in all future filings considering the si gnificant benefit this information provides
investors and the objective of the ASU.

4. Please tell us and revise your disclosures in  future filings to address the following:

• The policy for recording payments received on nonaccrual accrual receivables
in accordance with ASC 310-10-50-6(b);
• The policy for recognizing interest income on impaired loans, including how
cash receipts are recorded in accord ance with ASC 310-10-50-15(b); and
• The related amount of interest income recognized in accordance with ASC
310-10-50-15(c)(1).

5. We note your disclosure on within Note 3 as  it relates to “other assets  especially
mentioned” of loans which are considered to be within this specific classification
due to a variety of factors.  These factors may cause the loan officer to improperly
supervise the credit due to a lack of expertise, inadequate loan agreement, the
poor condition of or lack of control over collateral, failure to obtain proper loan
documentation or any other possible situati ons or circumstances. Each of these
factors disclosed would seem to be re presentative of a well defined weakness

Joseph M. Murphy
Bar Harbor Bankshares   April 6, 2011  Page 3
requiring classification within the “substandard” category.  Please address as to why the current classification is appropriate.  Further, te ll us whether these loans
as classified within this category are performing or nonperforming. You should
also address how this particular internal risk rating relates to the likelihood of loss
in accordance with ASC 310-10-50-30.

* * * *

 We urge all persons who are responsibl e for the accuracy an d adequacy of the
disclosure in the filing to be certain that the filing includes the information the Securities
Exchange Act of 1934 and all applicable Exch ange Act rules require. Since the company
and its management are in possession of all f acts relating to a company’s disclosure, they
are responsible for the accuracy and adequacy of the disclosures they have made.

In responding to our comments, please provi de a written statement from the company
acknowledging that:
• the company is responsible for the adequacy  and accuracy of the disclosure in the
filing;

• staff comments or changes to disclosure  in response to staff comments do not
foreclose the Commission from taking any act ion with respect to the filing; and

• the company may not assert staff comme nts as a defense in any proceeding
initiated by the Commission or any person under the federal secu rities laws of the
United States.   You may contact Marc Thomas, Staff Accountant, at (202)  551-3452 or me at
(202) 551-3492 if you have any questions regarding the above comments.
Sincerely,
          John P. Nolan         Sr Asst. Chief Accountant

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

      DIVISION OF
CORPORATION FINANCE
Mail Stop 4720
        June 15, 2009
By U.S. Mail and Facsimile to: (207) 288-3328

Gerald Shencavitz Executive Vice President & Chief Financial Officer Bar Harbor Bankshares 82 Main Street Bar Harbor, ME 04609-0400

Re: Bar Harbor Bankshares
 Form 10-K for the Fiscal Year Ended December 31, 2008
 Filed March 16, 2009
 File No. 001-13349

Dear Mr. Shencavitz:

We have completed our review of your Form 10-K and have no further comments at this
time.

Sincerely,

Kathryn McHale Staff Attorney

CORRESP
1
filename1.htm

Response to SEC letter 061109

June 11, 2009

BY FEDERAL EXPRESS AND EDGAR

Kathryn McHale

Staff Attorney

U.S. Securities and Exchange Commission

100 F Street, NE

Mail Stop 4561

Washington, DC 20549

    Re: Bar Harbor Bankshares

    Form 10-K for the Fiscal Year Ended December 31, 2008

    Filed: March 16, 2009

    File No.: 001-13349

Dear Ms. McHale:

On behalf of Bar Harbor Bankshares ( the "Company"), this letter
is in response to the staff’s comment letter dated May 29, 2009 relating to the
staff’s review of the above-referenced Form 10-K filing. Set forth below are the
staff’s comments in italics followed by the Company’s responses to the
staff’s comments.

Form 10-K for the Fiscal Year Ended December 31, 2008

Item 11. Executive Compensation

Short-term, Annual Incentive Cash Compensation Program, page 17 of
Definitive Proxy Statement on Schedule 14A

    1.
    Please tell us why you have
    not disclosed certain of the performance targets utilized in determining annual cash
    incentive compensation for your named executive officers for the 2008 fiscal year. For
    example, you have not disclosed the specific targets for credit asset quality, loan and
    deposit growth and other individual goals that were used as bases for awarding cash
    bonuses to your named executive officers. To the extent you believe that disclosure of the
    historical performance targets is not required because it would result in competitive harm
    such that the targets could be excluded under Instruction 4 to Item 402(b) of Regulation
    S-K, please provide a detailed supplemental analysis supporting your conclusion. In
    particular, your competitive harm analysis should clearly explain the nexus between
    disclosure of the performance objectives and the competitive harm that is likely to result
    from disclosure. Refer to Item 402(b)(2)(v) of Regulation S-K and Regulation S-K
    Compliance and Disclosure Interpretation 118.04.

            The
specific targets for credit asset quality, loan and deposit growth as well as specific
individual goals for the 2008 Annual Incentive Compensation Plan were previously provided
in the 2008 Annual Incentive Compensation Plan as filed by the Company with the Securities
and Exchange Commission (the "Commission") (Exhibit 10.1 to the Quarterly Report
on Form 10-Q filed on August 11, 2008). As these target goals and weightings vary
depending upon the individual named executive officer, the Company did not specify these
targets in the proxy statement because such inclusion appeared to be more confusing than
helpful to the shareholder. The target goals and weightings as disclosed in Exhibit 10.1
to the Quarterly Report were the actual performance targets used for 2008. In the future,
these individual performance criteria will be included in a chart similar to what was
included in the 2008 Annual Incentive Compensation Plan itself.

2008 Grants of Plan-Based Awards, page 26 of Definitive Proxy Statement on
Schedule 14A

    2.
    Please tell us how you calculated the
    amounts disclosed in the Estimated Future Payouts Under Non-Equity Incentive Plan Awards
    section of the table. We note, for example, that the amounts disclosed in this table for
    Mr. Murphy do not correspond to the threshold, target and stretch percentages of 12.50%,
    25.00% and 37.50% of base salary disclosed on page 17 of the definitive proxy statement.
    We also note that you do not disclose the grant dates for each award as required by Item
    402(d)(2)(ii) of Regulation S-K.

            The
amounts reflected in the Estimated Future Payouts Under Non-Equity Incentive Plan Awards
sections of the table were computed based on the Company’s actual results as opposed
to the possible payments under threshold, target and stretch performance levels. The
Company’s Annual Incentive Plan (the "Plan") provides for an annual payment
based on multiple performance measures. The payouts under the Plan are made early in the
subsequent year once the Company’s financial results are finalized. The Company
inadvertently reflected the actual amounts paid to each named executive officer
("NEO") under the various performance measures of the Plan based on whether
there was threshold, target or a stretch performance level achieved for each measure. In
future filings, the Company will reflect the possible payout under the different
performance levels and will disclose by footnote the actual amount paid to each NEO to the
extent that it has already been determined at the time of the filing of the proxy
statement.

            The
grant dates for the annual non-equity plan awards are contemporaneous with the adoption of
that year’s Company Annual Incentive Plan, which was in May 2008. In the future, the
Company will specify the actual date of grant in the table as required by Item
402(d)(2)(ii) of Regulation S-K.

Item 12. Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters

Voting Securities and Principal Holders Thereof, page 4 of Definitive
Proxy Statement on Schedule I4E

    3.
    Please tell us the natural person who holds
    voting power or investment power over the shares held by Shufro Rose & Co., LLC and
    include this disclosure in future filings.

            The
Schedule 13G filed by Shufro Rose & Co., LLC on February 12, 2009 was signed by Steven
J. Glass, Senior Managing Director, on behalf of Shufro Rose & Co., LLC. The Company
does not have any additional information on the natural person holding the voting power or
investment power over the shares held by Shufro Rose & Co., LLC. In its future
filings, the Company will include this additional information to the extent disclosed in
an amendment to Shufro Rose & Co., LLC’s Schedule 13G.

Certain Relationships and Related Transactions and Director Independence

Indebtedness of Management, page 40 of Definitive Proxy Statement on
Schedule 1

    4.
    It is unclear from your disclosure in
    the third paragraph whether you are in compliance with the disclosure requirements of Item
    404 of Regulation S-K. Please tell us if the company meets the requirements of Instruction
    4(c) to Item 404(a) of Regulation S-K, If so, please revise your future filings to clarify
    your transactions with related parties disclosure accordingly.

            Loans
to related persons (i) are made in the ordinary course of business, (ii) are made on
substantially the same terms as those prevailing at the time for comparable loans with
persons not related to the Company and (iii) do not involve more than the normal risk of
collectibility or present other unfavorable features. In its future filings, the Company
will make it clear in its disclosure of related party transactions that all loans to
related parties meet the requirements of Instruction 4(c) to Item 404(a) of Regulation
S-K.

Signatures

    5.
    Please tell us if the report has been
    signed by the company's controller or principal accounting officer. Please also
    confirm that you will clearly identify the company's controller or principal accounting
    officer as a signatory in future filings. Refer to General Instruction D(2)(a) to Form
    10-K.

            Gerald
Shencavitz, the Company’s Chief Financial Officer, serves as both the Company’s
principal financial officer and principal accounting officer. In future filings, the
Company will make it clear that he is signing in both capacities.

* * * *

            The
Company acknowledges that:

      the Company is responsible for the adequacy and accuracy of the disclosure in its
        filings;

      Staff comments or changes to disclosure in response to Staff comments do not foreclose
        the Commission from taking any action with respect to the filing; and

      the Company may not assert Staff comments as a defense in any proceeding initiated by
        the Commission or any person under the federal securities laws of the United States.

            Should
you have any questions concerning the above responses, please do not hesitate to call me
at (207) 288-2638.

    Respectfully submitted,/s/Gerald
    Shencavitz

    Gerald Shencavitz

    Chief Financial Officer

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

       DIVISION OF
CORPORATION FINANCE
Mail Stop 4561
May 29, 2009

By U.S. Mail and Facsimile to: (207) 288-3328

Gerald Shencavitz Executive Vice President & Chief Financial Officer Bar Harbor Bankshares 82 Main Street Bar Harbor, ME 04609-0400

Re: Bar Harbor Bankshares
Form 10-K for the Fiscal Year Ended December 31, 2008
Filed March 16, 2009
 File No. 001-13349

Dear Mr. Shencavitz:

We have reviewed your filing and have the following comments.  Where
indicated, we think you should re vise your document in response to these comments.  If
you disagree, we will consider your explanation as to why our comment is inapplicable or
a revision is unnecessary.  Please be as deta iled as necessary in your explanation.  In
some of our comments, we may ask you to provi de us with information so we may better
understand your disclosure.  After reviewing th is information, we may raise additional
comments.   Please understand that the purpose of our re view process is to assist you in your
compliance with the applicable disclosure  requirements and to  enhance the overall
disclosure in your filing.  We look forward to  working with you in these respects.  We
welcome any questions you may have about our comments or any other aspect of our
review.  Feel free to call us at the telephone numbers listed at the end of this letter.

Form 10-K for the Fiscal Year Ended December 31, 2008

 Item 11.  Executive Compensation

 Short-term, Annual Incentive Cash Compen sation Program, page 17 of Definitive Proxy
Statement on Schedule 14A
 1. Please tell us why you have not disclose d certain of the performance targets
utilized in determining annual cash incentive compensation for your named
executive officers for the 2008 fiscal year .  For example, you have not disclosed

Gerald Shencavitz
Bar Harbor Bankshares May 29, 2009 Page 2

the specific targets for credit asset qu ality, loan and deposit growth and other
individual goals that were used as bases for awarding cash bonuses to your named
executive officers.  To the extent you be lieve that disclosure of the historical
performance targets is not required because it would result in competitive harm such that the targets could be exclude d under Instruction 4 to Item 402(b) of
Regulation S-K, please provide a detailed supplemental analysis supporting your conclusion.  In particular, your competitiv e harm analysis should clearly explain
the nexus between disclosure of the pe rformance objectives and the competitive
harm that is likely to result from disc losure.  Refer to Item 402(b)(2)(v) of
Regulation S-K and Regulat ion S-K Compliance and Di sclosure Interpretation
118.04.
 2008 Grants of Plan-Based Awards, page 26 of Definitive Proxy Statement on Schedule
14A
 2. Please tell us how you calculated the amounts disclosed in the Estimated Future Payouts Under Non-Equity Incentive Plan Awards section of the table.  We note, for example, that the amounts disclosed in this table for Mr. Murphy do not correspond to the threshold, target and stretch percentages of 12.50%, 25.00% and
37.50% of base salary disclosed on page 17 of the definitive proxy statement.  We
also note that you do not disclose the gr ant dates for each award as required by
Item 402(d)(2)(ii) of Regulation S-K.
 Item 12.  Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
 Voting Securities and Principal Holders Thereof, page 4 of Definitive Proxy Statement
on Schedule 14A
 3. Please tell us the natural person who hol ds voting power or investment power
over the shares held by Shufro Rose & C o., LLC and include this disclosure in
future filings.
 Item 13.  Certain Relationships and Relate d Transactions and Director Independence

 Indebtedness of Management, page 40 of  Definitive Proxy Statement on Schedule 14A

 4. It is unclear from your disclosure in  the third paragraph whether you are in
compliance with the disclosure requireme nts of Item 404 of Regulation S-K.
Please tell us if the company meets the re quirements of Instruction 4(c) to Item
404(a) of Regulation S-K.  If so, please re vise your future filings to clarify your
transactions with related pa rties disclosure accordingly.

Gerald Shencavitz
Bar Harbor Bankshares May 29, 2009 Page 3

Signatures

5. Please tell us if the report has been  signed by the company’s controller or
principal accounting officer.  Please also c onfirm that you will clearly identify the
company’s controller or pr incipal accounting officer as  a signatory in future
filings.  Refer to General Inst ruction D(2)(a) to Form 10-K.
 Closing Comments

 Please respond to these comments within 10 business days or tell us when you
will provide us with a response.  Please furnish a cover letter that keys your responses to
our comments and provides any requested in formation.  Detailed cover letters greatly
facilitate our review.  Please understand th at we may have additional comments after
reviewing your responses to our comments.    We urge all persons who are responsi ble for the accuracy an d adequacy of the
disclosure in the filing to be certain that the filing includes all in formation required under
the Securities Exchange Act of 1934 and th at they have provided all information
investors require for an informed invest ment decision.  Since the company and its
management are in possession of all facts re lating to a company’s disclosure, they are
responsible for the accuracy and adequacy of the disclosures they have made.

 In connection with responding to our comments, please provide, in writing, a
statement from the company acknowledging that:
• the company is responsible for the adequacy  and accuracy of the disclosure in the
filing;

• staff comments or changes to disclosure  in response to staff comments do not
foreclose the Commission from taking any action with respect to the filing; and
 • the company may not assert staff comme nts as a defense in any proceeding
initiated by the Commission or any person under the federal secu rities laws of the
United States.

In addition, please be advise d that the Division of Enfo rcement has access to all
information you provide to the staff of the Divi sion of Corporation Fi nance in our review
of your filing or in response to our comments on your filing.

Gerald Shencavitz
Bar Harbor Bankshares May 29, 2009 Page 4

 Please contact Justin Dobbie at (202)  551-3469 or me at (202) 551-3464 with any
questions

Sincerely,

Kathryn McHale Staff Attorney

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

      DIVISION OF
CORPORATION FINANCE

Mail Stop 4561         December 8, 2008  Joseph M. Murphy  President & Chief Executive Officer Bar Harbor Bankshares 82 Main Street Bar Harbor, ME 04609

Re: Bar Harbor Bankshares
 Amendment No. 1 to Preliminar y Proxy Statement on Schedule 14A
Filed November 25, 2008
 File No. 001-13349

Dear Mr. Murphy:

We have completed our review of your Preliminary Proxy Statement on Schedule 14A
and have no further comments at this time.

Sincerely,

Kathryn McHale  Staff Attorney

CORRESP
1
filename1.htm

Insert For TARP Proxy

Insert for Bar Harbor Proxy

Bar Harbor Bankshares and
Subsidiaries

Pro Forma Condensed Consolidated Balance Sheet

September 30, 2008

(dollars in thousands)

(Unaudited)

    As of

    Pro Forma Adjustments

    Pro Forma

    09/30/08

    Minimum

    Maximum

    Minimum

    Maximum

    Balance Sheet Data:

    ASSETS

    Cash and due from banks
    $9,290

    $0

    $0

    $9,290

    $9,290

    Securities available for sale, at fair value
    269,609

    0

    0

    269,609

    269,609

    Loans, net of allowance for loan losses
    618,985

    0

    0

    618,985

    618,985

    Other Assets
    44,120

    0

    0

    44,120

    44,120

         TOTAL ASSETS
    $942,004

    $0

    $0

    $942,004

    $942,004

    LIABILITIES

    Total deposits (1)
    $578,163

    ($6,250)

    ($10,000)

    $571,913

    $568,163

    Borrowings(1)
    295,572

    0

    (8,751)

    295,572

    286,821

    Other Liabilities
    5,598

    0

    0

    5,598

    5,598

         TOTAL LIABILITIES
    879,333

    (6,250)

    (18,751)

    873,083

    860,582

    STOCKHOLDERS’ EQUITY

    Preferred Stock (1) (2)
    $0

    $6,250

    $18,751

    $6,250

    $18,751

    Capital Stock
    7,287

    0

    0

    7,287

    7,287

    Warrants (2) (4)
    0

    195

    584

    195

    584

    Discount on Preferred Stock (2) (3)
    0

    (195)

    (584)

    (195)

    (584)

    Surplus
    4,863

    0

    0

    4,863

    4,863

    Retained Earnings
    67,258

    0

    0

    67,258

    67,258

    Accumulated other comprehensive (loss) income
    (3,715)

    0

    0

    (3,715)

    (3,715)

    Treasury Stock
    (13,022)

    0

    0

    (13,022)

    (13,022)

         TOTAL STOCKHOLDERS’ EQUITY
    62,671

    6,250

    18,751

    68,921

    81,422

         TOTAL LIABILITIES AND

             STOCKHOLDERS’ EQUITY
    $942,004

    $0

    $0

    $942,004

    $942,004

(1) Pro forma amounts are based on an investment by the UST of a minimum
of $6.25 million and a maximum of $18.75 million in Capital Purchase Program
Securities.  The Company expects ultimately to utilize the proceeds to (i) strengthen
the Bank’s capital position, (ii) increase, where prudent, consumer and commercial
lending and (iii) facilitate the appropriate acquisition of bank branches or entire
banks.  Prior to such deployment, the TARP Capital Purchase Program proceeds, as
assumed in the pro forma financial statements above,  may be used to reduce brokered
deposits and other borrowings.   Expenses related to the issuance of Capital
Purchase Program Securities and the Warrants are expected to be immaterial and have not
been deducted from the sale proceeds.

(2) The proceeds from the sale of the Capital Purchase Program
Securities would be allocated between the  Shares and Warrants based on their
relative fair values on the issue date.  The fair value of the Warrants would be
determined using the Black-Scholes model which includes assumptions regarding the
Company’s common stock price, dividend yield, and stock price volatility, as well as
assumptions regarding the risk-free interest rate.  The fair value of the
Shares would be determined based on assumptions regarding the discount rate (market rate)
on the  Shares (currently estimated at 12%).

(3) The discount on the   Shares would be determined based on the
value that is allocated to the Warrants upon issuance, and would be accreted back to the
value of the  Shares over a five-year period (the expected life of the   Shares
upon issuance) using the constant effective yield method (approximately 5.7%).

(4) In connection with issuance of the Capital Purchase Program
Securities, and based on the market value of the Company’s   twenty day
average common share price as of November 21, 2008, the Company estimates it would issue
Warrants to the UST giving it the right to purchase approximately 34.8k shares of common
stock based on the Company’s sale of the minimum number of Capital Purchase Program
Securities, and 104.4k shares based on the Company’s sale of the maximum number of
Capital Purchase Program Securities.

Bar Harbor Bankshares and Subsidiaries

Pro Forma Condensed Consolidated Statements of Income

Pro Forma Impact of Minimum Estimated Proceeds

$6.25MM Preferred and Warrants for 34.8k shares

Year Ended December 31, 2007

(in thousands, except per share data)

    Historical

    12 Months

    Ended

    12/31/07

    Adjustments

    (unaudited)

    Pro Forma

    12 Months

    Ended

    12/31/07

    Net Interest Income
    $22,903

    $253
    (1)
    $23,156

    Loan Loss Provision
    456

    456

         Net Interest Income after
    Provision
    22,447

    253

    22,700

    Noninterest Income
    5,929

    5,929

    Noninterest Expense
    18,201

    18,201

         Income/(Loss) Before Taxes
    10,175

    253

    10,428

    Provision for Income Taxes
    3,020

    89
    (2)
    3,109

         Income before Preferred Dividends
    7,155

    165

    7,320

    Less: Preferred Dividends
    0

    348
    (3)
    348

         Income available to common
    shareholders
    $7,155

    ($183)

    $6,972

    Basic Earnings Per Share
    $2.36

    ($0.06)

    $2.30

    Diluted Earnings Per Share
    $2.30

    ($0.06)

    $2.24

    Weighted Average Shares Outstanding:

         Basic
    3,037,074

    3,037,074

         Diluted
    3,112,736

    4,914
    (4)
    3,117,650

(1) Assumes Capital Purchase Program proceeds are used to reduce
brokered deposits and short-term borrowings at an assumed annualized rate of approximately
4%. The actual impact to net interst income would be differnt as the Company expects
ultimately to utilize a portion of the proceeds to (i) increase, where prudent, consumer
and commercial lending and (ii) facilitate the appropriate acquisition of bank branches or
entire banks. However, such impact cannot be estimated at this time as the impact would
vary based on the timing of when the loans are funded, the actual pricing of any such
loans, and the cost of funding. Prior to such deployment, the TARP Capital Purchase
Program proceeds, as assumed in the pro forma financial statements above, may be used to
reduce brokered deposits and short term borrowings or augment investment securities.

(2) Additional income tax expense is attributable to additional net
interest income as described in Note (1).

(3) Consists of dividends on preferred stock at a 5% annual rate as well
as accretion on discount on preferred stock upon issuance. The discount is determined
based on the value that is allocated to the warrants upon issuance. The discount is
accreted back to par value on a constant effective yield method (approximately 5.7%) over
a five year term, which is the expected life of the preferred stock upon issuance. The
estimated accretion is based on a number of assumptions which are subject to change. These
assumptions include the discount (market rate at issuance) rate on the preferred stock,
and assumptions underlying the value of the warrants. The estimated proceeds are allocated
based on the relative fair value of the warrants as compared to the fair value of the
preferred stock. The fair value of the warrants is determined under a Black-Scholes model.
The model includes assumptions regarding Bar Harbor’s common stock price, dividend
yield, stock price volatility, as well as assumptions regarding the risk-free interest
rate. The lower the value of the warrants, the less negative impact on net income and
earnings per share available to common shareholders. The fair value of the preferred stock
is determined based on assumptions regarding the discount rate (market rate) on the
preferred stock (currently estimated at 12%). The lower the discount rate, the less
negative impact on net income and earnings per share available to common shareholders.

(4) As described in the Section titled “Additional Terms of the
Capital Purchase Program”, if approved to participate in the Capital Purchase
Program, the UST would receive warrants to purchase a number of shares of the
Company’s common stock having an aggregate market price equal to 15% of the proceeds
on the date of issuance with a strike price equal to the trailing twenty day trading
average leading up to the closing date. This pro forma assumes that the warrants would
give the UST the option to purchase 34.8k shares of Bar Harbor& Trust common stock.
The pro forma adjustment shows the increase in diluted shares outstanding assuming that
the warrants had been issued on January 1, 2007 at a strike price of $26.94 (based on the
trailing twenty day Bar Harbor average share price as of November 21, 2008) and remained
outstanding for the entire period presented. The treasury stock method was utilized to
determine dilution of the warrants for the period presented.

Bar Harbor Bankshares and
Subsidiaries

Pro Forma Condensed Consolidated Statements of Income

Pro Forma Impact of Maximum Estimated Proceeds

$18.75MM Preferred and Warrants for 104.4k shares

Year Ended December 31, 2007

(in thousands, except per share data)

    Historical

    12 Months

    Ended

    12/31/08

    Adjustments

    (unaudited)

    Pro Forma

    12 Months

    Ended

    12/31/07

    Net
    Interest Income
    $22,903

    $759

    (1)
    $23,662

    Loan
    Loss Provision
    456

    456

    Net Interest Income after Provision
    22,447

    759

    23,206

    Noninterest Income
    5,929

    5,929

    Noninterest
    Expense
    18,201

    18,201

    Income/(Loss) Before Taxes
    10,175

    759

    10,934

    Provision for
    Income Taxes
    3,020

    266
    (2)
    3,286

         Income before Preferred Dividends
    7,155

    494

    7,649

    Less:
    Preferred Dividends
    0

    1,042
    (3)
    1,042

    Income available to common shareholders
    $7,155

    ($548)

    $6,607

    Basic
    Earnings Per Share
    $2.36

    ($0.18)

    $2.18

    Diluted
    Earnings Per Share
    $2.30

    ($0.19)

    $2.11

    Weighted
    Average Shares Outstanding:

    Basic
    3,037,074

    3,037,074

    Diluted
    3,112,736

    14,744

    (4)

    3,127,480

(1) Assumes Capital Purchase Program proceeds are used to reduce
brokered deposits and short-term borrowings at an assumed annualized rate of approximately
4%. The actual impact to net interst income would be differnt as the Company expects
ultimately to utilize a portion of the proceeds to (i) increase, where prudent, consumer
and commercial lending and (ii) facilitate the appropriate acquisition of bank branches or
entire banks. However, such impact cannot be estimated at this time as the impact would
vary based on the timing of when the loans are funded, the actual pricing of any such
loans, and the cost of funding. Prior to such deployment, the TARP Capital Purchase
Program proceeds, as assumed in the pro forma financial statements above, may be used to
reduce brokered deposits and short term borrowings or augment investment securities.

(2) Additional income tax expense is attributable to additional net
interest income as described in Note (1).

(3) Consists of dividends on preferred stock at a 5% annual rate as well
as accretion on discount on preferred stock upon issuance. The discount is determined
based on the value that is allocated to the warrants upon issuance. The discount is
accreted back to par value on a constant effective yield method (approximately 5.7%) over
a five year term, which is the expected life of the preferred stock upon issuance. The
estimated accretion is based on a number of assumptions which are subject to change. These
assumptions include the discount (market rate at issuance) rate on the preferred stock,
and assumptions underlying the value of the warrants. The estimated proceeds are allocated
based on the relative fair value of the warrants as compared to the fair value of the
preferred stock. The fair value of the warrants is determined under a Black-Scholes model.
The model includes assumptions regarding Bar Harbor’s common stock price, dividend
yield, stock price volatility, as well as assumptions regarding the risk-free interest
rate. The lower the value of the warrants, the less negative impact on net income and
earnings per share available to common shareholders. The fair value of the preferred stock
is determined based on assumptions regarding the discount rate (market rate) on the
preferred stock (currently estimated at. The lower the discount rate, the less negative
impact on net income and earnings per share available to common shareholders.

(4) As described in the Section titled “Additional Terms of the
Capital Purchase Program”, if approved to participate in the Capital Purchase
Program, the UST would receive warrants to purchase a number of shares of the
Company’s common stock having an aggregate market price equal to 15% of the proceeds
on the date of issuance with a strike price equal to the trailing twenty day trading
average leading up to the closing date. This pro forma assumes that the warrants would
give the UST the option to purchase 104.4k shares of Bar Harbor’s common stock. The
pro forma adjustment shows the increase in diluted shares outstanding assuming that the
warrants had been issued on January 1, 2007 at a strike price of $26.94 (based on the
trailing twenty day Bar Harbor average share price as of November 21, 2008) and remained
outstanding for the entire period presented. The treasury stock method was utilized to
determine dilution of the warrants for the period presented.

Bar Harbor Bankshares and
Subsidiaries

Pro Forma Condensed Consolidated Statements of Income

Pro Forma Impact of Minimum Estimated Proceeds

$6.25MM Preferred and Warrants for 34.8k shares

Year Ended December 31, 2007

(in thousands, except per share data)

    Historical

    9 Months

    Ended

    09/30/08

    Adjustments

    (unaudited)

    Pro Forma

    9 Months

    Ended

    09/30/08

    Net Interest Income
    $19,952

    $189
    (1)
    $20,141

    Loan Loss Provision
    1,669

    1,669

         Net Interest Income after
    Provision
    18,283

    189

    18,472

    Noninterest Income
    6,205

    6,205

    Noninterest Expense
    15,334

    15,334

         Income/(Loss) Before Taxes
    9,154

    189

    9,343

    Provision for Income Taxes
    2,840

    66
    (2)
    2,906

         Income before Preferred Dividends
    6,314

    123

    6,437

    Less: Preferred Dividends
    0

    261
    (3)
    261

         Income available to common
    shareholders
    $6,314

    ($138)

    $6,176

    Basic Earnings Per Share
    $2.13

    ($0.05)

    $2.09

    Diluted Earnings Per Share
    $2.09

    ($0.05)

    $2.04

    Weighted Average Shares Outstanding:

         Basic
    2,959,120

    2,959,120

         Diluted
    3,025,526

    3,286
    (4)
    3,028,812

(1) Assumes Capital Purchase Program proceeds are used to reduce
brokered deposits and short-term borrowings at an assumed annualized rate of approximately
4%. The actual impact to net interst income would be differnt as the Company expects
ultimately to utilize a portion of the proceeds to (i) increase, where prudent, consumer
and commercial lending and (ii) facilitate the appropriate acquisition of bank branches or
entire banks. However, such impact cannot be estimated at this time as the impact would
vary based on the timing of when the loans are funded, the actual pricing of any such
loans, and the cost of funding. Prior to such deployment, the TARP Capital Purchase
Program proceeds, as assumed in the pro forma financial statements above, may be used to
reduce brokered deposits and short term borrowings or augment investment securities.

(2) Additional income tax expense is attributable to additional net
interest income as described in