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Personal Banking

Our commitment is to exceed expectations, one customer at a time.  And that's what makes Bay Bank unique - just like the customers we serve.  Read More >>

Business Banking

Our bank was built by entrepreneurs, for entrepreneurs. At Bay Bank, you will receive the responsive, personal service of a local bank combined with the strength and resources of a larger institution.  Read More >>

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Welcome to Bay Bank!

What matters to you, matters to us. 

Our commitment is to exceed expectations one customer at a time. At Bay Bank, you'll find a bank where bankers and customers actually know one another. You’ll have access to products, services and resources that provide the ability to achieve your financial goals.

We are proud to be a local bank dedicated to providing the personal service of a community bank combined with a larger institution’s strength of resources. 

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Recent News View All

Bay Bancorp, Inc. Announces First Quarter 2015 Results

Lutherville Maryland—Bay Bancorp, Inc. (“Bay”) (NASDAQ: BYBK), the savings and loan holding company for Bay Bank, FSB (“Bank”), announced today net income of $0.34 million or $0.03 per basic and diluted share for the quarter ended March 31, 2015, compared to net income of $0.08 million or $0.01 per basic and diluted share for the quarter ended March 31, 2014.

According to Joseph J. Thomas, Chairman, President and CEO, “Our management team remains committed to executing a differentiated business strategy articulated as the bank built by entrepreneurs for entrepreneurs in the Baltimore/Washington corridor, and executed by having lead relationships with businesses, real estate owners and professionals via an optimal network of sales offices and technology solutions to provide loans, deposits, e-services, mortgage banking and financial advisory services.” “For the quarter ended March 31, 2015, we continued to progress toward our goal of improved profitability resulting in expanded market capitalization. Our goal is to achieve the improvement through capital utilization with a keen eye on expense efficiency. While seeking growth, we preserved a very high quality balance sheet by reporting a 16.2% tier one risk-based capital to asset ratio, a 46.3% Adversely Classified Asset ratio and a 202.7% Commercial Real Estate loans to Capital ratio,” Thomas continued.

Highlights from the First Three Months of 2015

The Bank’s relationship management activities resulted in the growth of new loans in the Bank’s originated portfolio by a 32.8% annualized pace in the first quarter of 2015. Deposit growth, and particularly noninterest-bearing deposit growth, was strong during the first quarter of 2015, as the Bank recorded annualized growth of over 16%. Bay has a very strong capital position and capacity for future growth with total regulatory capital to risk weighted assets of 16.6% as of March 31, 2015. The Bank has a proven record of success in acquisitions and acquired problem asset resolutions and, at March 31, 2015, had

$13.4 million in remaining net purchase discounts on the acquired loan portfolios. Specific highlights are listed below:

  • The return on average assets for the three months ended March 31, 2015 was 0.29%, as compared to 1.09% for the three months ended December 31, 2014 and 0.08% for the same period of 2014. The return on average equity for the three-months ended March 31, 2015 was 2.08% compared to 7.87% for the three-months ended December 31, 2014 and 0.61%, for the first quarter of 2014.

  • Total assets were $487 million at March 31, 2015 compared to $480 million at December 31, 2014 and increased by $57 million from $430 million at March 31, 2014.

  • Total loans were $392 million at March 31, 2015, a decrease of 0.4% from $393 million at December 31, 2014 and an increase of 26% from $312 million at March 31, 2014.

  • Total deposits were $404 million at March 31, 2015, an increase of 4% from $388 million at December 31, 2014 and an increase of 9% from $372 million at March 31, 2014. Non-interest bearing deposits were $101 million, an increase of 10% from $92 million at December 31, 2014.

  • Net interest income for the three- months ended March 31, 2015 totaled $5.3 million compared to $5.2 million for the same period of 2014. Interest income associated with discount accretion on purchased loans, deferred costs and deferred fees will vary due to the timing and nature of loan principal payments. Earning asset leverage was the primary driver in year-over-year results, as average earning loans and investments increased to $428 million for the quarter ended March 31, 2015, compared to $354 million for the same period of 2014.

  • Net interest margin for the three-months ended March 31, 2015 was 4.73%, compared to 5.40% for the same period of 2014. The margin for the first quarter of 2015 reflects the variable pace of discount accretion recognition within interest income and the impact of fair value amortization on the interest expense of acquired deposits. For the quarter ended March 31, 2015, the earning asset portfolio yield was influenced by a $.42 million decline in net discount accretion of purchased loan discounts recognized in interest income and a $.35 million decrease in the fair value amortization on deposits when compared to the same period of 2014. The margin declined by 67 basis points during the quarter compared to a year earlier, nearly all related to loan and deposit accretion fluctuations.

  • Nonperforming assets increased to $15.61 million at March 31, 2015, from $14.34 million at December 31, 2014. The first quarter of 2015 increase resulted from the Bank’s delayed resolution of several acquired nonperforming loans from previous

    acquisitions.

  • The provision for loan losses for the three- months ended March 31, 2015 was $275,000, compared to $219,000 for the same period of 2014. The increase for the 2015 period was primarily the result of an increase in loan originations. As a result, the allowance for loan losses was $1.35 million at March 31, 2015, representing 0.35% of total loans, compared to $1.29 million, or 0.33% of total loans, at December 31, 2014. Management expects both the allowance for loan losses and the related provision for loan losses to increase in the future due to the gradual accretion of the discount on the acquired loan portfolios and an increase in new loan originations.

Balance Sheet Review

Total assets were $487 million at March 31, 2015, an increase of $7 million, or 1.48%, when compared to December 31, 2014. Loans held for sale increased by $5.3 million or 73% during the quarter and were offset by a $1.5 million or 0.39% decline in loans held for investment and a $2.5 million or 6.96% decline in investments available for sale.

Total deposits were $404 million at March 31, 2015, an increase of $16 million, or 4.25%, when compared to December 31, 2014. The increase was primarily assisted by a $9.5 million or 10.38% increase in non-interest bearing accounts. The increase in deposits resulted in a $10 million decrease in short-term borrowings over the quarter.

Stockholders’ equity decreased to $65.7 million at March 31, 2015 from $66.6 million at December 31, 2014 and increased from $54.9 million at March 31, 2014. The decrease over the first quarter of 2015 related to an increase in the Bay Bank retirement income plan liability due to changes in actuarial assumptions, offset by related deferred taxes. The book value of Bay’s common stock was $5.96 per share at March 31, 2015, compared to $6.05 per share at December 31, 2014.

Nonperforming assets, which consist of nonaccrual loans, troubled debt restructurings, accruing loans past due 90 days or more, and real estate acquired through foreclosure, increased slightly to $15.61 million at March 31, 2015 from $14.34 million at December 31, 2014. The increase related to a $.8 million reclassification of troubled debt restructurings to impaired loans offset by a decrease in nonaccrual loans. Nonperforming assets represented 3.22% of total assets at March 31, 2015, which was slightly elevated from the 2.99% recorded at December 31, 2014.

At March 31, 2015, the Bank remained above all “well-capitalized” regulatory requirement levels. The Bank’s tier 1 risk- based capital ratio was 16.22% at March 31, 2015 as compared to 16.31% at December 31, 2014 and 15.23% at March 31, 2014. Liquidity remained strong due to managed cash and cash equivalents, borrowing lines with the FHLB of Atlanta, the Federal Reserve and correspondent banks, and the size and composition of the investment portfolio.

Review of Financial Results

Net income for the three-months ended March 31, 2015 was $0.34 million compared to net income of $0.08 million for the same period of 2014. Individual categories reflect variability between years.

Net interest income increased by $0.2 million for the quarter ended March 31, 2015 when compared to the same period of 2014. The increase was supported by a $69 million growth in average interest-earning assets largely due to the Slavie Bank Acquisition (“the Slavie Acquisition”) in May 30, 2014, offset by a $.42 million decline in net discount accretion of purchased loan discounts recognized in interest income and a $.35 million decrease in the fair value amortization on deposits. Excluding the impact of the fair value accounting, net interest income increased by $.93 million from the quarter ended March 31, 2014. The net interest margin for the first quarter of 2015 decreased to 4.73% from 5.40% for the first quarter of 2014 due to the decline in discount accretion on loans and deposits. As of March 31, 2015, the remaining net loan discounts on the Bank’s loan portfolio, including loans acquired in “the Slavie Acquisition”, totaled $13.4 million.

Noninterest income for the three -months ended March 31, 2015 was $1.2 million compared to $1.3 million for the same quarter of 2014. This decrease was primarily the result of $.06 million decrease in electronic banking fees and a $.09 million decrease in other income partially offset by a $.08 million increase in mortgage banking fees and gains. Expectations are for increased mortgage fees and gains to expand in 2015.

Noninterest expense reduction is a key focus for 2015 net income improvement. For the three -months ended March 31, 2015 noninterest expense was $5.7 million compared to $6.3 million for the first quarter of 2014. The primary contributors

to the decrease when compared to the first quarter of 2014 decreases of $.45 million in salary and employee benefits, $.14 million in foreclosed property expenses and a decrease of $.11 million in Merger-related expenses.

In the fourth quarter of 2014, Bay filed amended 2011 and 2012 Federal and Maryland tax returns for the former Carrollton Bancorp, resulting in the accrual of $.6 million in tax refunds. Combined with a reversal of a deferred tax valuation allowance, the Bank recognized $1.2 million in favorable tax benefits in the fourth quarter of 2014.

Bay Bancorp, Inc. Information

Bay Bancorp, Inc. is a financial holding company and a savings and loan holding company headquartered in Lutherville, Maryland. Through Bay Bank, FSB, its federal savings bank subsidiary, Bay Bancorp, Inc. serves the community with a network of 10 branches strategically located throughout the Baltimore Metropolitan Statistical Area, particularly Baltimore City and the Maryland counties of Baltimore, Anne Arundel, Howard, Carroll, and Harford. The Bank serves local consumers, small and medium size businesses, professionals and other valued customers by offering a broad suite of financial products and services, including on-line and mobile banking, commercial banking, cash management, mortgage lending and retail banking. The Bank funds a variety of loan types including commercial and residential real estate loans, commercial term loans and lines of credit, consumer loans and letters of credit. The Bank’s subsidiary, Bay Financial Services, Inc., provides investment advisory and brokerage services. Additional information is available at www.baybankmd.com.

Forward-Looking Statements

The statements contained herein that are not historical facts are forward-looking statements (as defined by the Private Securities Litigation Reform Act of 1995) based on management's current expectations and beliefs concerning future developments and their potential effects on the Company. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of the Company. There can be no assurance that future developments affecting the Company will be the same as those anticipated by management. These statements are evidenced by terms such as “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” and similar expressions. Although these statements reflect management’s good faith beliefs and projections, they are not guarantees of future performance and they may not prove true. These projections involve risk and uncertainties that could cause actual results to differ materially from those addressed in the forward-looking statements. For a discussion of these risks and uncertainties, see the section of the periodic reports filed by Bay Bancorp, Inc. with the Securities and Exchange Commission entitled “Risk Factors”.

For investor inquiries contact:

Joseph J. Thomas, Chairman, President and CEO 410-536-7336

jthomas@baybankmd.com

7151 Columbia Gateway Drive, Suite A

Columbia, MD 21046

For further information contact:

Larry D. Pickett, Chief Financial Officer lpickett@baybankmd.com

410-427-3726

Bay Bancorp, Inc.

Consolidated Balance Sheets

March 31,

March 31,

2015

December 31,

2014

December 31,

(unaudited)

2014

(unaudited)

2013

ASSETS

Cash and due from banks

$

6,335,049

$

7,062,943

$

7,706,885

$

7,126,720

Interest bearing deposits with banks and federal funds sold

17,250,151

9,794,382

43,371,284

16,146,340

Total Cash and Cash Equivalents

23,585,200

16,857,325

51,078,169

23,273,060

Time deposits with banks

-

34,849

-

-

Investment securities available for sale, at fair value

32,890,719

35,349,889

36,040,327

36,586,669

Investment securities held to maturity, at amortized cost

1,296,793

1,315,718

-

-

Restricted equity securities, at cost

1,291,095

1,862,995

791,195

1,009,695

Loans held for sale

12,494,787

7,233,306

4,983,638

12,836,234

Loans, net of deferred fees and costs

391,537,271

393,051,192

311,969,640

320,680,332

Less: Allowance for loan losses

(1,353,849)

(1,294,976)

(941,715)

(851,000)

Loans, net

390,183,422

391,756,216

311,027,925

319,829,332

Real estate acquired through foreclosure

1,501,135

1,480,472

1,529,334

1,290,120

Premises and equipment, net

5,398,901

5,553,957

5,771,667

5,998,532

Bank owned life insurance

5,516,549

5,485,377

5,388,898

5,356,575

Core deposit intangible

3,223,737

3,478,282

3,719,384

3,993,679

Deferred tax assets, net

4,117,563

3,214,100

5,364,441

6,564,121

Accrued interest receivable

1,300,297

1,306,111

1,045,383

1,186,748

Accrued taxes receivable

2,819,468

3,122,885

539,781

-

Defined benefit pension asset

-

680,668

-

-

Other assets

1,410,994

1,210,835

2,312,855

1,164,538

Total Assets

$

487,030,660

$

479,942,985

$

429,592,997

$

419,089,303

LIABILITIES

Noninterest-bearing deposits

$

101,629,926

$

91,676,534

$

95,090,887

$

90,077,139

Interest-bearing deposits

302,674,673

296,153,598

276,846,536

270,916,332

Total Deposits

404,304,599

387,830,132

371,937,423

360,993,471

Short-term borrowings

12,150,000

22,150,000

-

-

Defined benefit pension liability

1,731,102

-

131

42,492

Accrued expenses and other liabilities

3,194,319

3,319,567

2,707,149

3,499,072

Total Liabilities

421,380,020

413,299,699

374,644,703

364,535,035

STOCKHOLDERS’ EQUITY

Common stock - par value $1.00, authorized 20,000,000 shares, issued and outstanding 11,014517, 11,014,517, 9,379,753 and

9,379,753 shares as of March 31, 2015, December 31, 2014,

March 31, 2014 and December 31, 2013, respectively.

11,014,517

11,014,517

9,379,753

9,379,753

Additional paid-in capital

43,372,280

43,228,950

36,497,449

36,357,001

Retained earnings

11,079,558

10,736,305

7,785,332

7,703,597

Accumulated other comprehensive income

184,285

1,663,514

1,285,760

1,113,917

Total Stockholders' Equity

65,650,640

66,643,286

54,948,294

54,554,268

Total Liabilities and Stockholders' Equity

$

487,030,660

$

479,942,985

$

429,592,997

$

419,089,303

Bay Bancorp, Inc.

Consolidated Statements of Income (Loss)

(Unaudited)

Three Months Ended March 31,

2015

2014

Interest income:

Interest and fees on loans

$

5,507,767

$

5,140,386

Interest on loans held for sale

61,511

85,801

Interest and dividends on securities

257,436

247,349

Interest on deposits with banks and federal funds sold

10,612

13,368

Total Interest Income

5,837,326

5,486,904

Interest expense:

Interest on deposits

484,401

309,059

Interest on short-term borrowings

13,776

-

Total Interest Expense

498,177

309,059

Net Interest Income

5,339,149

5,177,845

Provision for loan losses

275,109

219,165

Net interest income after provision for loan losses

5,064,040

4,958,680

Noninterest income:

Electronic banking fees

576,190

639,994

Mortgage banking fees and gains

393,642

312,675

(Loss) gain on sale of real estate acquired through foreclosure

(628)

1,829

Service charges on deposit accounts

79,017

92,513

Gain on securities sold

77,490

-

Other income

111,509

206,361

Total Noninterest Income

1,237,220

1,253,372

Noninterest Expenses:

Salary and employee benefits

2,919,119

3,365,432

Occupancy expenses

719,832

749,279

Furniture and equipment expenses

275,401

312,129

Legal, accounting and other professional fees

368,028

394,120

Data processing and item processing services

342,673

275,150

FDIC insurance costs

106,311

67,709

Advertising and marketing related expenses

28,749

39,405

Foreclosed property expenses

60,363

199,363

Loan collection costs

87,510

47,179

Core deposit intangible amortization

254,546

274,295

Merger and acquisition related expenses

-

111,323

Other expenses

537,352

504,289

Total Noninterest Expenses

5,699,884

6,339,673

Income (loss) before income taxes

601,376

(127,621)

Income tax (benefit) expense

258,123

(209,356)

Net income

$

343,253

$

81,735

Basic net (loss) income per common share

$

0.03

$

0.01

Diluted net (loss) income per common share

$

0.03

$

0.01

Bay Bancorp, Inc.

Consolidated Statements of Stockholders' Equity

For the Three Months Ended March 31, 2015 and 2014

(Unaudited)

Accumulated

Additional

Other

Common

Paid-in

Retained

Comprehensive

Stock

Capital

Earnings

Income (loss)

Total

Balance December 31, 2013

$

9,379,753

$

36,357,001

$

7,703,597

$

1,113,917

$

54,554,268

Net income

-

-

81,735

-

81,735

Other comprehensive income

-

171,843

171,843

Stock-based compensation

-

140,448

-

-

140,448

Balance March 31, 2014

$

9,379,753

$

36,497,449

$

7,785,332

$

1,285,760

$

54,948,294

Accumulated

Additional

Other

Common

Paid-in

Retained

Comprehensive

Stock

Capital

Earnings

Income (loss)

Total

Balance December 31, 2014

$

11,014,517

$

43,228,950

$

10,736,305

$

1,663,514

$

66,643,286

Net income

-

-

343,253

-

343,253

Other comprehensive income

-

(1,479,229)

(1,479,229)

Stock-based compensation

-

143,330

-

-

143,330

Balance March 31, 2015

$

11,014,517

$

43,372,280

$

11,079,558

$

184,285

$

65,650,640

Bay Bank, FSB Capital Ratios (Unaudited)

To Be Well Capitalized Under

To Be Considered Prompt Corrective

Actual Adequately Capitalized Action Provisions

Amount

Ratio

Amount

Ratio

Amount

Ratio

As of March 31, 2015:

Total Risk-Based Capital Ratio

$ 64,172

16.57 %

$ 30,982

8.00 %

$ 38,728

10.00 %

Tier I Risk-Based Capital Ratio

$ 62,818

16.22 %

$ 15,491

4.00 %

$ 23,237

6.00 %

Leverage Ratio

As of December 31, 2014:

$ 62,818

13.01 %

$ 19,314

4.00 %

$ 24,142

5.00 %

Total Risk-Based Capital Ratio

$ 62,743

16.66 %

$ 30,129

8.00 %

$ 37,661

10.00 %

Tier I Risk-Based Capital Ratio

$ 61,448

16.31 %

$ 15,070

4.00 %

$ 22,605

6.00 %

Leverage Ratio

$ 61,448

12.94 %

$ 18,995

4.00 %

$ 23,743

5.00 %

As of September 30, 2014:

Total Risk-Based Capital Ratio

$ 60,376

16.14 %

$ 29,922

8.00 %

$ 37,402

10.00 %

Tier I Risk-Based Capital Ratio

$ 59,247

15.84 %

$ 14,961

4.00 %

$ 22,441

6.00 %

Leverage Ratio

$ 59,247

12.51 %

$ 18,943

4.00 %

$ 23,679

5.00 %

As of June 30, 2014:

Total Risk-Based Capital Ratio

$ 60,205

15.99 %

$ 30,122

8.00 %

$ 37,653

10.00 %

Tier I Risk-Based Capital Ratio

$ 59,105

15.70 %

$ 15,061

4.00 %

$ 22,592

6.00 %

Leverage Ratio

$ 59,105

12.27 %

$ 19,263

4.00 %

$ 24,079

5.00 %

As of March 31, 2014:

Total Risk-Based Capital Ratio

$ 49,354

15.53 %

$ 25,423

8.00 %

$ 31,778

10.00 %

Tier I Risk-Based Capital Ratio

$ 48,412

15.23 %

$ 12,711

4.00 %

$ 19,067

6.00 %

Leverage Ratio

$ 48,412

11.44 %

$ 16,927

4.00 %

$ 21,159

5.00 %

As of December 31, 2013:

Total Risk-Based Capital Ratio

$ 47,815

14.68 %

$ 26,079

8.00 %

$ 32,562

10.00 %

Tier I Risk-Based Capital Ratio

$ 46,964

14.42 %

$ 13,025

4.00 %

$ 19,537

6.00 %

Leverage Ratio

$ 46,964

11.41 %

$ 16,461

4.00 %

$ 20,577

5.00 %

Bay Bancorp, Inc.

Selected Financial Data

(Unaudited)

Three Months Ended

Twelve Months Ended

March 31, 2015

March 31, 2014

December 31,

2014

December 31, 2014

December 31,

2013

Financial Data:

Assets

$

487,030,660 $

429,592,997

$

479,942,985

$

479,942,985

$

419,089,303

Investment securites

34,187,512

36,040,327

36,665,607

36,665,607

36,586,669

Loans (net of deferred fees and costs)

391,537,271

311,969,640

393,051,192

393,051,192

320,680,332

Allowance for loan losses

1,353,849

941,715

1,294,976

1,294,976

851,000

Deposits

404,304,599

371,937,423

387,830,132

387,830,132

360,933,471

Borrowings

12,150,000

-

22,150,000

22,150,000

-

Stockholders’ equity

65,650,640

54,948,294

66,643,286

66,643,286

54,554,268

Net income (loss)

343,253

81,735

1,310,327

3,032,708

3,241,134

Average Balances:

Assets

485,027,802

417,018,727

476,700,436

459,782,360

358,397,210

Investment securities

35,318,852

36,434,000

35,827,735

36,561,271

24,427,877

Loans (net of deferred fees and costs)

392,780,700

317,227,783

392,275,709

364,511,290

259,698,504

Borrowings

16,155,556

-

18,500,000

9,269,231

92,328

Deposits

399,249,747

359,929,587

391,419,769

385,700,292

306,040,717

Stockholders' equity

66,785,682

54,751,281

66,079,174

61,530,969

48,537,003

Performance Ratios:

Return on average assets

0.29%

0.08%

1.09%

0.66%

0.90%

Return on average equity

2.08%

0.61%

7.87%

4.93%

6.68%

Yield on average interest-earning assets

5.17%

5.72%

5.90%

5.60%

5.71%

Rate on average interest-bearing liabilities

0.63%

0.46%

0.43%

0.42%

0.55%

Net interest spread

4.54%

5.26%

5.47%

5.18%

5.16%

Net interest margin

4.73%

5.40%

5.59%

5.31%

5.33%

Book value per share

$

5.96

$

4.99

$

6.05

$

6.05

$

5.83

Basic net income per share

0.03

0.01

0.12

0.29

0.39

Diluted net income per share

0.03

0.01

0.12

0.29

0.39

March 31, 2015

March 31, 2014

December 31,

2014

Asset Quality Ratios:

Allowance for loan losses to loans

0.35%

0.30%

0.33%

Nonperforming loans to total loans

3.59%

3.34%

3.27%

Nonperforming assets to total assets

3.22%

2.69%

2.99%

Net charge-offs annualized to avg. loans

0.06%

0.17%

0.06%

Capital Ratios (Bay Bank, FSB):

Total risk-based capital ratio

16.57%

15.53%

16.66%

Tier 1 risk-based capital ratio

16.22%

15.23%

16.31%

Leverage ratio

13.01%

11.44%

12.94%

FOR IMMEDIATE RELEASE

BAY BANK SERVES AS PRESENTING SPONSOR FOR SMART CEO EVENT

LUTHERVILLE, MD – March 23, 2015 – Bay Bank recently announced that it sponsored the Executive Management Awards, hosted by Smart CEO, which honors leadership team members in the Baltimore region. As a presenting sponsor, Joseph Thomas, President and CEO of Bay Bank, was honored to announce the winners in the CFO and CIO/CTO categories.

The Executive Management Awards recognizes the leadership and accomplishments of the region’s corporate management including CFOs, CIOs/CTOs, Chief Legal Officer/General Counsels, Chief Human Resources and other C-suite executives. Selected by an independent committee of local business leaders, the committee reviews the EMA nominations and winners are chosen based on the quality of the nominations submitted. Honorees are executive professionals across many industries who demonstrate business savvy, creative spirit and the financial acumen necessary to help propel their company to success.

About Bay Bank

Bay Bank, FSB is headquartered in Lutherville, Maryland and is focused on providing superior customer service to the local communities in our market. Bay Bank serves the community with a network of 10 branches strategically located throughout the region. Bay Bank serves local consumers, small and medium size businesses, professionals and other valued customers by offering a broad suite of financial products and services, including on-line and mobile banking, commercial banking, cash management, mortgage lending and retail banking. A locally based financial institution, the Bank has total assets of approximately $480.0 million. The Bank’s parent company, Bay Bancorp, Inc., trades on the NASDAQ Capital Market under the ticker symbol “BYBK”. Investor information is available on Bay Bank’s website at www.baybankmd.com.

Contact: Lori Mueller, Head of Marketing

Bay Bank, FSB (410) 312-5400

MEMBER FDIC www.baybankmd.com Headquarters: Operations Center:

2328 West Joppa Road, Suite 325 7151 Columbia Gateway Drive, Suite A Lutherville, MD 21093 Columbia, MD 21046

(410) 494-2580 (410) 312-5400

FOR IMMEDIATE RELEASE

PAUL RACHETTA JOINS BAY BANK AS RELATIONSHIP MANAGER

LUTHERVILLE, MD – November 7, 2014 – Bay Bank announced today that Paul Rachetta has joined the Bank’s Commercial Banking Division as a Vice President and Relationship Manager. In this capacity, Rachetta will be responsible for developing new commercial relationships with businesses throughout Howard and Montgomery Counties.

Rachetta comes to Bay Bank with more than 17 years of banking experience including working with mid-market and large corporate companies. Prior to joining Bay Bank, Rachetta served as a Vice President in the Large Corporate and Business Banking divisions for M&T Bank. His strengths in sales development, relationship management, credit analysis, negotiations and Treasury Management aided him in receiving the President’s Club award in 2010 and 2012 in Commercial Banking Overall Performance.

“Paul is an experienced banker whose customer expertise ranges from consumer banking to large corporate firms,” said H. King Corbett, Executive Vice President & Chief Lending Officer. “This knowledge will serve him well at Bay Bank,” continued Corbett.

Rachetta holds a bachelor’s degree from State University of New York, College at Oneonta. He lives in Onley with his wife and two children. Rachetta will be working out of the bank’s Operations Center located in Columbia.

About Bay Bank

Bay Bank, FSB is headquartered in Lutherville, Maryland and is focused on providing superior customer service to the local communities in our market. Bay Bank serves the community with a network of 10 branches strategically located throughout the region. Bay Bank serves local consumers, small and medium size businesses, professionals and other valued customers by offering a broad suite of financial products and services, including on-line and mobile banking, commercial banking, cash management, mortgage lending and retail banking. A locally based financial institution, the Bank has total assets of approximately $480 million as of September 30, 2014. The Bank’s parent company, Bay Bancorp, Inc., trades on the NASDAQ Capital Market under the ticker symbol “BYBK”. Investor information is available on Bay Bank’s website at www.baybankmd.com.

Contact: King Corbett, Executive Vice President & Chief Lending Officer Bay Bank, FSB

(410) 427-3771

kcorbett@baybankmd.com

MEMBER

wFwDwIC.baybankmd.com

Headquarters:

Operations Center:

2328 West Joppa Road, Suite 325

7151 Columbia Gateway Drive, Suite A

Lutherville, MD 21093

(410) 494-2580

Columbia, MD 21046

(410) 312-5400

Bay Bancorp, Inc. Announces Third Quarter 2014 Results

Lutherville Maryland—November 5, 2014—Bay Bancorp, Inc. (“Bay”) (NASDAQ: BYBK), the savings and loan holding company for Bay Bank, FSB (“Bank”), announced today net income of $1.79 million or $0.18 per diluted share for nine months ended September 30, 2014, compared to net income of $2.32 million or $0.29 per diluted share for the first nine months of 2013. For the quarter, Bay reported a net loss of $0.94 million or $0.09 per diluted share, compared to net income of $2.64 million or $0.26 per diluted share for the 2nd quarter of 2014 and net income of $0.92 million or $0.11 per diluted share for the third quarter of 2013. The nine months ended September 30, 2014 include a $511,000 bargain purchase gain compared to a $2.86 million bargain purchase gain for the first nine months of 2013.

“After completing strategic steps in the second quarter of 2014 to reduce core operating expenses and cost of funds, in this quarter the Bank absorbed $1.1 million of previously announced, one-time stock-based compensation expense, and

$0.6 million in extraordinary expenses related to the Slavie acquisition and subsequent integration” said Kevin B. Cashen, President and Chief Executive Officer. “The acquisition of Slavie Federal Savings Bank from the FDIC supports the plan to add earning assets at a discount, increase scale and improve profitability going forward.”

Highlights from the First Nine Months of 2014

  • The return on average assets for the three and nine months ended September 30, 2014 was -0.77% and 0.54%, respectively, as compared to 0.80% and 0.93%, respectively, for the same periods of 2013. The return on average equity for the three and nine months ended September 30, 2014 was -5.62% and 3.89%, respectively, as compared to 6.74% and 6.70%, respectively, for the same periods of 2013.

  • Total assets decreased to $480 million at September 30, 2014 compared to $487 million at June 30, 2014 and $419 million at December 31, 2013.

  • Total loans decreased to $394 million at September 30, 2014, a decrease of 0.3% from $395 million at June 30, 2014 and an increase of 23% from $321 million at December 31, 2013.

  • Total deposits decreased to $399 million at September 30, 2014, a decrease of 5% from $419 million at June 30, 2014 and an increase of 10% from $361 million at December 31, 2013.

  • Net interest income for the three and nine month periods ended September 30, 2014 totaled $5.5 million and $16.5 million, respectively, compared to $5.8 million and $12.5 million, respectively, for the same periods of 2013. The third quarters were comparable from a leverage basis with variable accretion income credited at a slower pace in third quarter of 2014. Discount recognition will vary due to the timing and nature of resolutions. Third quarter of 2014 recognition trailed the third quarter of 2013 recognition by $0.46 million. Earning asset leverage was a key driver in year-over-year results, as average earning assets increased to $401 million for the nine months ended September 30, 2014, compared to $311 million for the same period of 2013.

  • Net interest margin for the three and nine months ended September 30, 2014 was 4.80% and 5.50%, respectively, compared to 5.44% and 5.37%, respectively, for the same periods of 2013. The 3rd quarter decrease reflects the variable pace of accretion income. For the first nine months of 2014, favorable credit resolutions and a 14 basis point decrease in the average cost of interest bearing liabilities to 0.42% when compared to the same period of 2013 support the 13 basis point improvement.

  • Nonperforming assets increased to $20.67 million at September 30, 2014, up from $18.46 million at June 30, 2014 and $ 9.60 million at December 31, 2013. The increase resulted from the Bank’s acquisition of assets from Slavie Federal Savings Bank (“Slavie”) in May 2014, which added performing credit impaired loans at June 30, 2014, all with purchase discounts which are expected to be sufficient to resolve any credit impairments.

  • The provision for loan losses in the three and nine months ending September 30, 2014 was $220,000 and $580,000, respectively, compared to $350,000 and $534,000, respectively, for the same periods of 2013. The changes from the 2013 periods were due primarily to charge-offs and specific reserves established for loans acquired in the Bank’s merger with

    Carrollton Bank in April 2013 (the “Merger”) and loan originations thus far in 2014. As a result, the allowance for loan losses was $1.13 million at September 30, 2014, representing 0.29% of total loans, compared to $0.85 million, or 0.27% of total loans, at December 31, 2013. Management expects both the allowance for loan losses and the related provision for loan losses to increase in the future due to the gradual runoff of the discount on the acquired loan portfolio and an increase in new loan originations.

  • Total Capital increased to $65.2 million at September 30, 2014 from $65.0 million at June 30, 2014 and $54.6 million at December 31, 2013. The book value of Bay’s common stock was $5.92 per share at September 30, 2014, compared to $6.01 per share at June 30, 2014 and $5.82 per share at December 31, 2013.

Recent Events

On May 30, 2014, the Bank entered into an agreement with Federal Deposit Insurance Corporation (“FDIC”) to acquire certain assets and assumed substantially all deposits and certain other liabilities of Slavie (the “Slavie Acquisition”), which was closed on that date by the Office of the Comptroller of the Currency (“OCC”). In the Slavie Acquisition, the Bank acquired assets with a fair value of $117.1 million, including $82.9 million in loans, while assuming liabilities of $110.8 million. The Bank did not acquire any of Slavie’s other real estate owned.

An independent valuation specialist was engaged during the third quarter of 2014 to prepare a fair valuation analysis for the Slavie loan portfolio, core deposit intangible asset, and time deposit portfolio. The valuation resulted in a summary before- tax bargain purchase gain of $511,000 compared to an initial pre-tax bargain purchase gain of $697,000 estimate recorded at June 30, 2014. The adjusted valuation was properly recorded as a second quarter 2014 adjustment, resulting in an $113,000 decrease in second quarter after-tax income. Summary valuation as of May 30, 2014 includes an overall loan fair value mark-to-market discount to book value of $7.87 million, a core deposit intangible of $0.48 million and a certificate premium of $0.13 million

Bay anticipates a normal level of additional expenses in the fourth quarter of 2014 related to the Slavie system conversion and other acquisition related costs.

On July 29, 2014, the Board of Directors of Bay granted 212,000 shares of Bay’s common stock to certain directors and officers and granted options to purchase 77,000 shares of Bay’s common stock to certain officers and a consultant. The equity awards were granted to certain directors and officers and a consultant to recognize their efforts in building the Bank since being founded in 2010 by the Financial Services Partners Fund I, LLC (“FSPF”). H Bancorp, LLC was formed on June 30, 2014 as the successor entity and Bay’s new top-tier holding company. The liquidation of FSPF was a condition imposed by the Board of Governors of the Federal Reserve System as part of its approval of the Merger. Bay realized an expense of

$1.1 million in the third quarter of 2014 as a result of these equity awards, which will offset a portion of the one-time gains recorded in the second quarter of 2014. Further details can be found in Bay’s Current Report on Form 8-K filed with the Securities and Exchange Commission on August 5, 2014.

Over the weekend of October 10, 2014, the Bank completed the core system integration of the Slavie/FISERV platform to the Bay Bank/FIS platform. The Finance/General Ledger consolidation was also completed within this integration. Several Slavie employees filled open positions within the Bank and have relocated to their new locations.

The former headquarters branch for Slavie was closed on October 10, 2014. All deposits were transferred to the Bank’s Hickory branch location. We anticipate no additional costs related to the facility.

Balance Sheet Review

Total assets were $480 million at September 30, 2014, an increase of $60.4 million, or 14%, when compared to December 31, 2013. The increase was due to net increases in loans of $73.4 million, or 23%. The Bank acquired net loans of $82.9 million in the Slavie Acquisition, which was offset by a net loan decline of $9.9 million, a $6.5 million decrease in mortgage loans held for sale and a $10.6 million increase in stockholders’ equity. Excluding $7.0 million of net amortization from the acquired Slavie portfolio, the Bank achieved increased commercial and residential lending volume. Third quarter new loan originations and draws exceeded loan principal repayments by $6.0 million, a 6.1% annualized pace of net loan growth.

Total deposits were $399 million at September 30, 2014, an increase of $38 million, or 10%, when compared to December 31, 2013. The increase was primarily driven by $110.8 million in deposits assumed in the Slavie Acquisition, offset by the

$24.0 million decrease from the exit of the IRA product line, a net $9.5 million decrease resulting from the three closed Bank branch locations, and deposits acquired in the Slavie Acquisition declining by $43.1 million as part of the Bank’s strategy to reposition the deposit composition.

The Bank experienced organic net deposit growth of $3 million over the first nine months of 2014. Stockholders’ equity was

$65.2 million at September 30, 2014, an increase of $10.7 million, or 19%, when compared to December 31, 2013. The increase resulted from the $7.0 million received in the Capital Transaction, $1.4 million of stock based compensation and the retention of corporate earnings.

Nonperforming assets, which consist of nonaccrual loans, troubled debt restructurings, accruing loans past due 90 days or more, and real estate acquired through foreclosure, increased to $20.67 million at September 30, 2014 from $18.32 million at June 30, 2014 and $9.60 million at December 31, 2013. This increase was due primarily to the migration of acquired PCI loan balances to nonaccrual status during the third quarter. Nonperforming assets represented 4.31% of total assets at September 30, 2014 compared to 3.79% at June 30, 2014 and 2.29% at December 31, 2013. The ratio of net charge-offs (annualized) to average total loans was 0.19% for the third quarter of 2014 and 0.49% for the third quarter of 2013.

At September 30, 2014, the Bank remained above all “well-capitalized” regulatory requirement levels. The Bank’s tier 1 risk-based capital ratio was 15.84% at September 30, 2014 as compared to 15.70% at June 30, 2014 and 14.42% at December 31, 2013. Liquidity remained strong due to managed cash and cash equivalents, borrowing lines with the FHLB of Atlanta, the Federal Reserve and correspondent banks, and the size and composition of the investment portfolio.

Review of Financial Results

Net income for the three- and nine-month periods ended September 30, 2014 was a ($0.94 million loss) and $1.79 million, respectively, compared to net income of $0.92 million and $2.32 million, respectively, for the same periods of 2013. With variations in net income primarily the result of the bargain purchase gains from the Merger and the Slavie acquisition, changes were less comparable between periods.

Net interest income increased by $4.0 million for the nine months ended September 30, 2014 when compared to the nine months ended September 30, 2013. The increase was supported by a $90 million growth in average interest-earning assets added by the Merger and the Slavie Acquisition, a 14 basis point reduction in the average cost of interest bearing liabilities, and a 5 basis point increase in the average rates earned on interest-earning assets. The net interest margin for the third quarter of 2014 decreased to 4.80% from 5.56% for the second quarter of 2014 and 5.44% for the third quarter of 2013. While the average rates on interest earning assets increased, interest income recognition volatility was impacted by favorable loan resolutions and accretion of net discounts on loans of $0.9 million and $4.0 million during the three- and nine-month periods of 2014, respectively, compared to $1.2 million and $3.2 million, respectively, during the same periods of 2013. As of September 30, 2014, the remaining net loan discounts on the Bank’s loan portfolio, including pre-Merger bank loans and loans acquired in the Merger and the Slavie Acquisition totaled $16.60 million.

Noninterest income for the three months ended September 30, 2014 was $1.13 million compared to $1.76 million for the same period in 2013. This decrease was primarily the result of $0.27 million decrease in mortgage banking fees and gains along with a $0.20 million decline in brokerage commissions. Expectations are for increased income in both areas in upcoming quarters.

Noninterest income for the nine months ended September 30, 2014 was $6.63 million compared to $6.77 million for the same period in 2013. This variance was the result of the 2014 remaining interest rate mark-to-market adjustment on IRA deposits of $2.16 million and a $0.51 million bargain purchase gain compared to the $2.86 million bargain purchase gain associated with the Merger that was recognized during the first nine months of 2013. Electronic banking fees increased by $0.63 million during the first nine months of 2014, as the Merger added this business unit to the Bank. Brokerage commissions declined by$.32 million for the first nine months of 2014 as the Bank temporarily exited this business line late in 2013. Mortgage banking fees for the first nine months ended September 30, 2014 declined by $0.79 million when compared to the same period of 2013, while deposit service charges increased by $0.09 million.

Noninterest expense for the three months ended September 30, 2014 was $7.97 million compared to $6.26 million for the prior quarter and $6.72 million for the third quarter of 2013. The primary contributors to the increase when compared to the third quarter of 2013 were increases in Merger-related expenses of $0.39 million and one-time other expenses $0.98 million. This overall increase was also impacted by the Slavie Acquisition, which added an additional $0.20 million in salaries and benefits and $0.10 million in other noninterest expenses in September 2014.

Noninterest expense for the nine months ended September 30, 2014 was $20.57 million compared to $16.16 million for the same period in 2013, an increase of $4.41 million. The increase relates to the inclusion during the first nine months of 2014 of a full nine-months of ongoing expenses related to the Merger and $0.76 million of expenses from the Slavie Acquisition. Categories impacted by this full nine-months of expenses were increases in salaries and employee benefits of $2.12 million, occupancy, furniture and equipment expenses of $1.10 million, foreclosed property expenses of $0.23 million, legal,

accounting and other professional fees of $0.13 million and core deposit intangible amortization of $0.22 million. This was offset by a $1.12 million decline in Merger-related expenses. We anticipate a normal level of expenses in the fourth quarter of 2014 related to core expenses and acquisition related costs.

Bay Bancorp, Inc. Information

Bay Bancorp, Inc. is a financial holding company and a savings and loan holding company headquartered in Lutherville, Maryland. Through Bay Bank, FSB, its federal savings bank subsidiary, Bay Bancorp, Inc. serves the community with a network of 10 branches strategically located throughout the Baltimore Metropolitan Statistical Area, particularly Baltimore City and the Maryland counties of Baltimore, Anne Arundel, Howard, Carroll, and Harford. The Bank serves local consumers, small and medium size businesses, professionals and other valued customers by offering a broad suite of financial products and services, including on-line and mobile banking, commercial banking, cash management, mortgage lending and retail banking. The Bank funds a variety of loan types including commercial and residential real estate loans, commercial term loans and lines of credit, consumer loans and letters of credit. The Bank’s subsidiary, Bay Financial Services, Inc., provides investment advisory and brokerage services. Additional information is available at www.baybankmd.com.

Forward-Looking Statements

The statements contained herein that are not historical facts are forward-looking statements (as defined by the Private Securities Litigation Reform Act of 1995) based on management's current expectations and beliefs concerning future developments and their potential effects on the Company. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of the Company. There can be no assurance that future developments affecting the Company will be the same as those anticipated by management. These statements are evidenced by terms such as “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” and similar expressions. Although these statements reflect management’s good faith beliefs and projections, they are not guarantees of future performance and they may not prove true. These projections involve risk and uncertainties that could cause actual results to differ materially from those addressed in the forward-looking statements. For a discussion of these risks and uncertainties, see the section of the periodic reports filed by Bay Bancorp, Inc. with the Securities and Exchange Commission entitled “Risk Factors”.

For investor inquiries contact: Joseph J. Thomas, Executive Chairman, 410-536-7336 jthomas@baybankmd.com 7151 Columbia Gateway Drive, Suite A Columbia, MD 21046 For further information contact:

Larry D. Pickett, Chief Financial Officer lpickett@baybankmd.com

410-427-3726

Consolidated Balance Sheets

ASSETS

Cash and due from banks

September 30,

2014

(unaudited)

$ 7,318,090

June 30,

2014

(unaudited)

$ 9,536,345

December 31,

2013

$ 7,126,720

Interest bearing deposits with banks and federal funds sold

9,654,840

14,890,664

16,146,340

Total Cash and Cash Equivalents

16,972,930

24,427,009

23,273,060

Time deposits with banks

284,849

500,000

-

Investment securities available for sale, at fair value

34,428,746

35,829,418

36,586,669

Investment securities held to maturity, at amortized cost

1,334,462

-

-

Restricted equity securities, at cost

1,367,995

919,795

1,009,695

Loans held for sale

6,317,277

6,103,088

12,836,234

Loans, net of deferred fees and costs

394,080,772

395,046,505

320,680,332

Less: Allowance for loan losses

(1,129,250)

(1,099,646)

(851,000)

Loans, net

392,951,522

393,946,859

319,829,332

Real estate acquired through foreclosure

1,642,524

1,520,609

1,290,120

Premises and equipment, net

5,589,176

5,646,918

5,998,532

Bank owned life insurance

5,453,093

5,420,981

5,356,575

Core deposit intangible

3,732,826

3,722,865

3,993,679

Deferred taxassets, net

5,258,484

5,287,136

6,564,121

Accrued interest receivable

1,277,781

1,389,888

1,186,748

Defined benefit pension asset

540,058

42,231

-

Other assets

2,367,825

2,713,245

1,164,538

Total Assets

$ 479,519,548

$ 487,470,042

$ 419,089,303

LIABILITIES

Noninterest-bearing deposits

$ 92,902,861

$ 104,021,800

$ 90,077,139

Interest-bearing deposits

305,693,481

315,122,594

270,916,332

Total Deposits

398,596,342

419,144,394

360,993,471

Short-term borrowings

Defined benefit pension liability

12,000,000

-

-

-

- 42,492

Accrued expenses and other liabilities

3,724,242

3,280,059

3,499,072

Total Liabilities

414,320,584

422,424,453

364,535,035

STOCKHOLDERS’ EQUITY

Common stock - par value $1.00, authorized 20,000,000 shares, issued and outstanding 11,014,517 and 9,379,753 shares as of September 30, 2014 and December 31, 2013, respectively.

11,014,517

10,818,773

9,379,753

Additional paid-in capital

43,143,903

42,178,489

36,357,001

Retained earnings

9,488,743

10,540,587

7,703,597

Accumulated other comprehensive income

1,551,801

1,507,740

1,113,917

Total Stockholders' Equity

65,198,964

65,045,589

54,554,268

Total Liabilities and Stockholders' Equity

$ 479,519,548

$ 487,470,042

$ 419,089,303

Bay Bancorp, Inc.

Consolidated Statements of Income (Loss) (Unaudited)

Three Months Ended S eptember 30, Nine Months Ended S eptember 30,

2014 2013

2014

2013

Interest income:

Interest and fees on loans

$ 5,537,260

$ 5,679,302

$ 16,457,477

$ 12,410,826

Interest on loans held for sale

64,265

349,561

196,274

590,714

Interest and dividends on securities

213,862

154,267

706,315

321,486

Interest on deposits with banks and federal funds

sold

7,217

20,730

39,245

58,526

Total Interest Income

5,822,604

6,203,860

17,399,311

13,381,552

Interest expense:

Interest on deposits

286,368

397,159

896,596

898,763

Interest on short-term borrowings

12,706

-

12,706

1,692

Total Interest Expense

299,074

397,159

909,302

900,455

Net Interest Income

5,523,530

5,806,701

16,490,009

12,481,097

Provision for loan losses

220,373

350,365

580,217

533,621

Net interest income after provision for loan losses

5,303,157

5,456,336

15,909,792

11,947,476

Noninterest income:

Electronic banking fees

674,701

708,300

1,991,048

1,359,477

Mortgage banking fees and gains

259,740

529,570

767,803

1,556,385

Net (loss) gain on sale of real estate acquired

through foreclosure

(1,503)

40,998

27,422

89,342

Brokerage commissions

-

199,392

-

316,884

Service charges on deposit accounts

99,451

100,476

303,396

191,690

Bargain purchase gain

-

-

510,844

2,860,199

Other income

95,003

184,311

3,031,629

397,418

Total Noninterest Income

1,127,392

1,763,047

6,632,142

6,771,395

Noninterest Expenses:

Salary and employee benefits

3,244,553

3,461,109

9,769,014

7,644,886

Occupancy expenses

722,573

716,482

2,256,683

1,458,086

Furniture and equipment expenses

280,320

239,704

875,274

526,551

Legal, accounting and other professional fees

356,226

344,867

1,088,451

961,948

Data processing and item processing services

371,572

394,021

863,909

832,636

FDIC insurance costs

84,882

82,246

287,568

194,572

Advertising and marketing related expenses

105,546

78,277

290,511

220,254

Foreclosed property expenses

113,903

104,170

504,295

273,084

Loan collection costs

152,196

143,021

305,099

303,253

Core deposit intangible amortization

245,673

336,273

738,415

517,203

Merger and acquisition related expenses

637,272

143,709

877,560

1,998,646

Other expenses

1,656,933

674,990

2,710,245

1,228,680

Total Noninterest Expenses

7,971,649

6,718,869

20,567,024

16,159,799

(Loss) income before income taxes

(1,541,100)

500,514

1,974,910

2,559,072

Income tax(benefit) expense

Net (loss) income

(599,585)

$ (941,515)

(422,279)

$ 922,793

189,764

$ 1,785,146

235,811

$ 2,323,261

Basic net (loss) income per common share

$ (0.09)

$ 0.11

$ 0.18

$ 0.29

Diluted net (loss) income per common share

$ (0.09)

$ 0.11

$ 0.18

$ 0.29

Consolidated Statements of Stockholders' Equity

For the Nine Months Ended September 30, 2014 and 2013 (Unaudited)

Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income Total Balance December 31, 2013 $ 9,379,753 $ 36,357,001 $ 7,703,597 $ 1,113,917 $ 54,554,268 Net income - - 1,785,146 - 1,785,146

Other comprehensive income - - - 437,884 437,884 Stock-based compensation 212,000 1,209,666 - - 1,421,666 Issuance of common stock 1,422,764 5,577,236 - - 7,000,000 Balance September 30, 2014 11,014,517 43,143,903 9,488,743 1,551,801 65,198,964

Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (loss) Total Balance December 31, 2012 $ 5,831,963 $ 21,269,898 $ 4,462,463 $ 260,092 $ 31,824,416 Net income - - 2,323,261 - 2,323,261

Other comprehensive loss - (251,231) (251,231)

Issuance of common stock to FSPF I, LLC 2,039,958 8,960,042 - - 11,000,000 Carrollton Bancorp shares retained at the

date of Merger 1,483,457 5,800,313 - - 7,283,770

Stock-based compensation - 242,022 - - 242,022 Issuance of common stock under stock

option plan 8,887 31,103 - - 39,990

Balance September 30, 2013 $ 9,364,265 $ 36,303,378 $ 6,785,724 $ 8,861 $ 52,462,228 Bay Bank, FSB Capital Ratios (Unaudited)

(in thousands)

To Be Considered

Actual Adequately Capitalized

To Be Well Capitalized Under Prompt Corrective

Action Provis ions

As of S eptember 30, 2014:

Amount

Ratio

Amount

Ratio

Amount

Ratio

Total Risk-Based Capital Ratio

$ 60,376

16.14

%

$ 29,922

8.00

%

$ 37,402

10.00

%

Tier I Risk-Based Capital Ratio

$ 59,247

15.84

%

$ 14,961

4.00

%

$ 22,441

6.00

%

Leverage Ratio

$ 59,247

12.51

%

$ 18,943

4.00

%

$ 23,679

5.00

%

As of June 30, 2014:

Total Risk-Based Capital Ratio

$ 60,205

15.99

%

$ 30,122

8.00

%

$ 37,653

10.00

%

Tier I Risk-Based Capital Ratio

$ 59,105

15.70

%

$ 15,061

4.00

%

$ 22,592

6.00

%

Leverage Ratio

$ 59,105

12.27

%

$ 19,263

4.00

%

$ 24,079

5.00

%

As of March 31, 2014:

Total Risk-Based Capital Ratio

$ 49,354

15.53

%

$ 25,423

8.00

%

$ 31,778

10.00

%

Tier I Risk-Based Capital Ratio

$ 48,412

15.23

%

$ 12,711

4.00

%

$ 19,067

6.00

%

Leverage Ratio

$ 48,412

11.44

%

$ 16,927

4.00

%

$ 21,159

5.00

%

As of December 31, 2013:

Total Risk-Based Capital Ratio

$ 47,815

14.68

%

$ 26,079

8.00

%

$ 32,562

10.00

%

Tier I Risk-Based Capital Ratio

$ 46,964

14.42

%

$ 13,025

4.00

%

$ 19,537

6.00

%

Leverage Ratio

$ 46,964

11.41

%

$ 16,461

4.00

%

$ 20,577

5.00

%

Selected Financial Data (Unaudited)

Three Months Ended Nine Months Ended

Year Ended

September 30, 2014

June 30, 2014

September 30, 2013

September 30, 2014

September 30, 2013

December 31, 2013

Financial Data:

Assets

$ 479,519,548

$ 487,470,042

$ 439,996,824

$ 479,519,548

$ 439,996,824

$ 419,089,303

Investment securites

35,763,208

35,829,418

31,276,084

35,763,208

31,276,084

36,586,669

Loans (net of deferred fees and costs)

394,080,772

395,046,505

321,907,285

394,080,772

321,907,285

320,680,332

Allowance for loan losses

(1,129,250)

(1,099,646)

(690,474)

(1,129,250)

(690,474)

(851,000)

Deposits

398,596,342

419,144,394

380,844,499

398,596,342

380,844,499

360,933,471

Borrowings

12,000,000

-

-

12,000,000

-

-

Stockholders’ equity

65,198,964

65,045,589

54,619,330

65,198,964

54,619,330

54,554,268

Net (loss) income

(941,515)

2,644,926

922,793

1,785,146

2,323,261

3,241,134

Average Balances:

Assets

485,175,007

448,315,402

457,966,929

445,479,782

333,422,318

358,397,210

Investment securities

36,881,377

36,926,555

27,953,097

37,712,361

20,313,935

24,427,877

Loans (net of deferred fees and costs)

397,302,596

339,716,287

327,819,042

322,877,223

239,513,467

259,698,504

Borrowings

15,135,870

-

-

18,745,421

55,678

-

Deposits

400,964,856

385,002,128

398,510,708

363,400,788

283,476,914

231,245,789

Stockholders' equity

66,409,980

60,238,668

54,296,315

61,344,406

46,338,360

48,537,003

Performance Ratios:

Return on average assets

-0.77%

2.37%

0.80%

0.54%

0.93%

0.90%

Return on average equity

-5.62%

17.61%

6.74%

3.89%

6.70%

6.68%

Yield on average interest-earning assets

5.06%

5.84%

5.81%

5.81%

5.76%

5.71%

Rate on average interest-bearing liabilities

0.37%

0.42%

0.53%

0.42%

0.56%

0.55%

Net interest spread

4.69%

5.42%

5.28%

5.39%

5.20%

5.16%

Net interest margin

4.80%

5.56%

5.44%

5.50%

5.37%

5.33%

Book value per share

$ 5.92

$ 6.01

$ 5.48

$ 5.92

$ 5.83

$ 5.82

Basic net income per share

(0.09)

0.26

0.11

0.18

0.29

0.39

Diluted net income per share

(0.09)

0.26

0.11

0.18

0.29

0.39

September 30, 2014

June 30, 2014

March 31,

2014

December 31, 2013

Asset Quality Ratios:

Allowance for loan losses to loans

0.29%

0.28%

0.22%

0.27%

Nonperforming loans to total loans

4.83%

4.29%

3.34%

2.59%

Nonperforming assets to total assets

4.31%

3.79%

2.69%

2.29%

Net charge-offs annualized to avg. loans

0.19%

-0.02%

0.16%

0.25%

Capital Ratios (Bay Bank, FSB):

Total risk-based capital ratio

16.14%

15.99%

15.53%

14.68%

Tier 1 risk-based capital ratio

15.84%

15.70%

15.23%

14.42%

Leverage ratio

12.51%

12.27%

11.44%

11.41%

FOR IMMEDIATE RELEASE

BAY BANK HIRES BRYAN LEPAGE AS RELATIONSHIP MANAGER

LUTHERVILLE, MD – October 10, 2014 – Bay Bank announced today that Bryan LePage has accepted a position in the Bank’s Business Banking Division as a Vice President and Business Banking Relationship Manager. LePage will be responsible for developing new business relationships for the Bank in the greater Baltimore region.

LePage has worked in various roles throughout his 12 years in the banking industry. For the past 10 years he has been with Columbia Bank. Through his success at sourcing new business and commitment to understanding the customer’s broader needs, LePage was selected to spearhead a new Business Banking division focused on lending to businesses with revenue of up to $10 million. He was named Vice President in this capacity.

“Bryan is passionate about assisting small companies to reach their goals. This is exactly the type of enthusiasm we look for in this role.” said H. King Corbett, Executive Vice President and Chief Lending Officer.

LePage has a bachelor’s degree from Methodist University. He will be working out of the Bank’s Corporate Headquarters in Lutherville.

About Bay Bank

Bay Bank, FSB is headquartered in Lutherville, Maryland and is focused on providing superior customer service to the local communities in our market. Bay Bank serves the community with a network of 10 branches strategically located throughout the region. Bay Bank serves local consumers, small and medium size businesses, professionals and other valued customers by offering a broad suite of financial products and services, including on-line and mobile banking, commercial banking, cash management, mortgage lending and retail banking. A locally based financial institution, the Bank has total assets of approximately $487.6 million. The Bank’s parent company, Bay Bancorp, Inc., trades on the NASDAQ Capital Market under the ticker symbol “BYBK”. Investor information is available on Bay Bank’s website at www.baybankmd.com.

Contact: King Corbett, Executive Vice President & Chief Lending Officer Bay Bank, FSB

(410) 427-3771

MEMBER FDIC

www.baybankmd.com Headquarters: Operations Center:

2328 West Joppa Road, Suite 325 7151 Columbia Gateway Drive, Suite A Lutherville, MD 21093 Columbia, MD 21046

(410) 494-2580 (410) 312-5400