8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 25, 2012

SUSSEX BANCORP

(Exact name of registrant as specified in its charter)

New Jersey
(State or other jurisdiction of
incorporation or organization) 0-29030 (Commission
File Number) 22-3475473
(I.R.S. Employer
Identification No.)

200 Munsonhurst Road

Franklin, New Jersey 07416
(Address of principal executive offices, zip code)

Registrant’s telephone number, including area code: (973) 827-2914 

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.07. Submission of Matters to a Vote of Security Holders.

Sussex Bancorp (the “Company”) held its 2012 Annual Meeting of Shareholders (the “Annual Meeting”) on April 25, 2012. There were 3,403,445 shares of common stock eligible to be voted at the Annual Meeting and 2,872,792 shares of common stock were presented in person or represented by proxy at the Annual Meeting, which constituted a quorum to conduct business.

There were two proposals submitted to the Company’s shareholders at the Annual Meeting.  All proposals were passed.  The final results of voting on each of the proposals are as follows:

Proposal 1: Election of Directors

Nominee	Votes For	Votes Withheld	Broker Non-Vote
Anthony S. Abbate	1,747,010	542,224	583,558
Mark J. Hontz	1,781,800	507,434	583,558
Donald L. Kovach	1,815,455	473,779	583,558
Timothy Marvil	1,883,057	406,177	583,558

Proposal 2: Ratification of Appointment of Independent Registered Public Accounting Firm

Votes For	Votes Against	Abstain	Broker Non-Vote
2,734,915	22,135	115,742	-

Item 7.01. Regulation FD Disclosure.

The Company made a presentation to its shareholders at the Annual Meeting. A copy of the presentation is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information contained in this Item 7.01, including Exhibit 99.1, shall not be deemed “filed” with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by the Company under the Securities Act of 1933, as amended.

Item 9.01. Financial Statements and Exhibits.

(d)  Exhibits.

Exhibit Number	Description
99.1	Presentation materials for the Annual Meeting of Shareholders, dated April 25, 2012

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

WEST	SUSSEX BANCORP
Date: April 26, 2012	By:	/s/ Steven M. Fusco
		Steven M. Fusco
		Executive Vice President and Chief Financial Officer

EXHIBIT INDEX

Exhibit Number	Description
99.1	Presentation materials for the Annual Meeting of Shareholders, dated April 25, 2012

EX-99.1

2011 Annual Meeting April 25, 2012

2 FORWARD - LOOKING STATEMENT We may, from time to time, make written or oral “forward - looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements contained in our filings with the Securities and Exchange Commission (the “SEC”), our reports to shareholders and in other communications by us. This presentation contains “forward - looking statements” which may be identified by the use of such words as “believe,” “expect,” “anticipate,” “should,” “planned,” “estimated,” and “potential.” Examples of forward - looking statements include, but are not limited to, estimates with respect to our financial condition, results of operation and business that are subject to various factors which could cause actual results to differ materially from these estimates. These factors include, but are not limited to : • changes to interest rates, the ability to control costs and expenses; • our ability to integrate new technology into its operations; • general economic conditions; • the success of our efforts to diversify its revenue base by developing additional sources of non - interest income while continuing to manage its existing fee based business; • the impact on us of the changing statutory and regulatory requirements; and • the risks inherent in commencing operations in new markets. Any or all of our forward - looking statements in this presentation, and in any other public statements, we make may turn out to be wrong. They can be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties. Consequently, no forward - looking statements can be guaranteed. We disclaim any obligation to subsequently revise any forward - looking statements to reflect events or circumstances after the date of such statements, or to reflect the occurrence of anticipated or unanticipated events .

 President’s Message  Our Business Environment  Our Performance  Shareholder Value  Looking Ahead 3 Annual Meeting 2012

 Building for the Future  New Brand  Board of Directors  Financial Overview 4 President’s Message

Building for the Future  Talented management team  Loan production office – Rochelle Park  Added 4 seasoned and proven commercial lenders 5 President’s Message

New Brand  Defines our differentiator, which is the Customer experience  Understanding our Customer needs  Being relationship oriented community bank  Establishing an emotional connection with our Customers (Not process)  In essence we get “Closer to Our Customers” 6 President’s Message

Board of Directors  Chairman of the Board succession by Edward Leppert  We strengthened the Board’s lending oversight and organizational capabilities with the addition of two directors to the Bank’s Board of Directors (Robert McNerney and Richard Branca) that have extensive real estate expertise .  Critical to strong risk management 7 President’s Message

8 Our Business Environment Equity Markets (source: SNL Financial LC) • 11 consecutive quarters of positive growth in GDP • Economy has shown signs of stabilizing • Equity markets trading near 2006 levels (Bubble???) • Interest rates at historical lows • This recovery has lagged all other recoveries and is sluggish, however showing positive signs

9 Our Business Environment 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 10.0 11.0 Feb-02 Sep-02 Apr-03 Nov-03 Jun-04 Jan-05 Aug-05 Mar-06 Oct-06 May-07 Dec-07 Jul-08 Feb-09 Sep-09 Apr-10 Nov-10 Jun-11 Jan-12 NJ Unemployment US and NJ Unemployment Rate • High level of unemployment; however, improving modestly • L ack of confidence from both businesses and consumers • Consumers and businesses not spending and not reinvesting back into the economy; in turn, savings and cash are growing and their financial conditions are strengthening (source: dlshort.com) (source: Department of Labor)

10 Our Business Environment • Real Estate Markets still exhibit weakness, however no longer free falling - x CRE market in Northern NJ still strained x Office space in Northern NJ is still flat x NYC markets are strengthening and building momentum x Northern NJ will benefit from progression x Multi - family is the flavor of choice (low cap rates are risk point) x Retail will continue to be strained due to many big boxes downsizing, which may create opportunities for small businesses again x Lack of market for land (difficult to value) • Markets further from NYC will recover more slowly

11 Our Business Environment 0 50 100 150 200 250 300 350 400 450 500 550 600 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 NJ Institutions National Institutions Bank Failures and Government Assisted Transactions (source: SNL Financial LC)

12 Financial sector continues to underperform the broader markets (source: SNL Financial LC)

 Select accomplishments  Lending and Credit Quality  Market Extension  Financial Performance 13 Our Performance

 Executive and senior management  Relationship banking paradigm  New commercial lending team  Company’s culture now emphasizes: ▪ Partnership, Teamwork, Trust and Respect ▪ Customer Experience & Sales ▪ Risk management -- especially Credit & Interest Rate Risk -- understanding the “What If ?” ▪ Governance ▪ Employee growth and development (R&R) ▪ Continuing to be good corporate citizens by giving back the communities we serve 14 Select Accomplishments

 Introduced a plan to be customer centric  New credit and administrative process  Improved operations infra - structure that enhance our capabilities  Loan production office in Rochelle Park  Built capabilities in the Treasury area (ALCO and Investments)  Security strategies improving IRR and credit exposure (risk / reward)  Improved financial reporting and transparency (internally and externally)  Modernizing our technology and delivery channels  Reducing problem assets by 21%  Tri - state Insurance success story (to be continued) 15 Select Accomplishments

Lending  New leadership and oversight  Improved credit decision process and reporting  Credit philosophy has changed (understand “what - if?”)  Focus on cashflow , strength of guarantor and secondary and tertiary sources of repayment  Team sales culture with other business lines  Geographic diversification into strong markets 16 Lending and Credit Quality

17 Market Extension (source: SNL Financial LC)

Credit Quality  Resolving our credit issues remains our number one priority  Overall credit quality improved and continues to exhibit positive trends .  Some deterioration in non - performing assets  Credit costs remain elevated in resolving problem assets 18 Lending and Credit Quality

19 CREDIT QUALITY $- $10 $20 $30 $40 $50 $60 $70 $80 03/31/10 06/30/10 09/30/10 12/31/10 03/31/11 06/30/11 09/30/11 12/31/11 REO $4.3 $4.6 $2.1 $2.1 $2.1 $4.5 $4.5 $5.5 Classified: Special Mention $24.0 $24.7 $26.4 $24.4 $24.4 $11.6 $7.9 $7.9 Classified: Substandard $33.7 $29.4 $28.0 $31.1 $33.1 $37.3 $38.7 $35.4 Classified: Doubtful $0.8 $0.8 $0.7 $0.5 $0.0 $0.0 $0.0 $0.8 Classified/Critized Assets and REO • Overall problem assets continue to shrink 21% decline

20 CREDIT QUALITY

21 CREDIT QUALITY • Top 23 problem loan relationships represent approximately 72% of criticized and classified loans (by balance) • Executive management reviews the status of each of those relationships on a weekly basis ▪ Develop strategies for each of them ▪ Follow - up on the execution of those strategies ▪ Sounding board for workout group in structuring solutions • The resolution process takes long, however we are making strong headway in getting to resolution, which will improve our credit quality.

22 FINANCIAL PERFORMANCE (Peer Group source : SNL Financial LC - 10 NJ Commercial Banks with assets less than $1 billion with a similar profile as Sussex Bank )

 Balance sheet - Total assets increased by 6.9% over last year - Total deposits increased 10.2% over last year (first half flat, but finished year strong) - Loans grew 0.4% over last year (portfolio began shrinking early in 1Q into year - end)  Capital adequacy: all in excess of the ratios required to be deemed “well - capitalized” 23 FINANCIAL PERFORMANCE: 2011 Highlights

24 Loan growth (source: SNL Financial LC)

25 Strong core deposit franchise with a #2 market share in Sussex County (source: SNL Financial LC)

26 Earnings per Share $0.73 $0.45 ($0.32) $0.62 $0.66 $0.74 ($0.40) ($0.20) $0.00 $0.20 $0.40 $0.60 $0.80 2006 2007 2008 2009 2010 2011 Earnings per share (diluted)

Income Statement (+$294k or 13.5%)  Non - interest income +$672k (security strategies +$593k and Tri - State +$199k)  Net interest income ( te ) +$548k (driven by 6bp growth in the margin)  Partly offset by $755k (or 5.0%) increase in non - interest expense (salaries and loan collections costs) 27 FINANCIAL PERFORMANCE: 2011 Highlights

 Growth in earnings (13.5%) was achieved despite numerous headwinds » Credit costs were $4.5 million » Security write - downs of $231k » Non - recurring expenses $200k  Offset most of the headwinds with: » Security strategies (+$645k) » Managing net interest margin through deposit pricing (+$857k) » Vigilant in reviewing all operating expenses for cost/benefit. 28 Financial Performance Summary

29 FINANCIAL PERFORMANCE (source: SNL Financial LC)

30 FINANCIAL PERFORMANCE (source: SNL Financial LC)

31 FINANCIAL PERFORMANCE (source: SNL Financial LC)

32 FINANCIAL PERFORMANCE (source: SNL Financial LC)

33 FINANCIAL PERFORMANCE (source: SNL Financial LC)

34 FINANCIAL PERFORMANCE (source: SNL Financial LC)

35 Shareholder Value Building our business through: + Leadership and management + Corporate governance + Risk management and improved credit quality + Customer experience + Employee experience will strengthen our financial performance= Long term shareholder value

36 Questions?