NEWS RELEASE

FOR IMMEDIATE RELEASE                                                                                                           

SANDY SPRING BANCORP REPORTS FIRST QUARTER RESULTS

OLNEY, MARYLAND, April 21, 2009 — Sandy Spring Bancorp, Inc., (Nasdaq-SASR) the parent company of Sandy Spring Bank, today announced net income available to common shareholders for the first quarter of 2009 of $1.0 million ($.06 per diluted share) compared to net income of $8.2 million ($.50 per diluted share) for the first quarter of 2008 and a net loss available to common shareholders of $3.8 million ($.23 per diluted share) for the fourth quarter of 2008. The first quarter of 2009 included a provision for loan and lease losses of $10.6 million related primarily to the residential real estate development portfolio.

“Our level of loan loss provisioning continues to be influenced by the ongoing negative economic conditions on both a regional and local basis. Specifically, the $10.6 million provision was driven by internal risk rating downgrades along with specific reserves that are set up to cover individual loans in our residential real estate development portfolio,” said Daniel J. Schrider, President and Chief Executive Officer. “We continue to aggressively monitor and work out problem credits in all segments of our loan portfolios, particularly those related to builders.”

“On the deposit side, we are extremely pleased with our recent growth in customer funding sources, which advanced 8% during the first quarter. This growth was due in large part to our new Premier money market product.  While we are pricing this product very competitively over the short term, we believe the resulting growth in market share will enable us to develop expanded customer relationships that we can retain over the long term.”

“We also closed over $121 million in residential mortgage loans in the first quarter of 2009 compared to $62 million in the prior year quarter,” said Schrider.  “This provides further evidence of our dedication to provide needed banking services to the communities that we serve.”

First Quarter Highlights:

·   The provision for loan and lease losses totaled $10.6 million for the quarter compared to $2.7 million for the first quarter of 2008 and $17.8 million for the fourth quarter of 2008.  The provision was in response to continued internal risk rating downgrades, charge-offs and additional specific reserves primarily related to loans in the residential real estate development portfolio.

·   The net interest margin was 3.39% for the first quarter compared to 3.99% for the first quarter of 2008 and 3.73% for the fourth quarter of 2008.

·   Noninterest expenses decreased 2% for the quarter compared to the first quarter of 2008 and decreased 11% versus the linked fourth quarter of 2008. Excluding the goodwill impairment charge in the fourth quarter, noninterest expenses decreased 4%.These results are consistent with the Company’s expectations for project LIFT, a previously disclosed initiative for managing operating expenses.

·   Customer funding sources, comprised of deposits and other short-term borrowings from core customers, increased 8% compared to balances at both March 31, 2008 and December 31, 2008. These increases were due primarily to growth in the Company’s new Premier money market savings product.

Review of Balance Sheet and Credit Quality

Comparing March 31, 2009 balances to March 31, 2008, total assets increased 11% to $3.5 billion due mainly to a 9% growth in deposits. This growth in deposits was the primary driver of increases of 52% in investments and 38% in cash and cash equivalents. Total loans and leases increased 4% to $2.5 billion compared to the prior year. This increase in loans was comprised mainly of a 6% increase in commercial loans and a 9% increase in consumer loans.  Total loans decreased 1% compared to the fourth quarter of 2008.

Customer funding sources, which include deposits plus other short-term borrowings from core customers, increased 8% to $2.6 billion at March 31, 2009 compared to the prior year.  Such customer funding sources also increased 8% compared to the fourth quarter of 2008.  These increases were due primarily to growth resulting from the Company’s new Premier money market account. Borrowings from the Federal Home Loan Bank of Atlanta increased 22% to $412 million compared to the prior year. Compared to the fourth quarter of 2008, such borrowings remained virtually level. The increase over the prior year was necessary to fund loan growth during the second and third quarters of 2008.

Stockholders’ equity totaled $392.5 million at March 31, 2009, and represented 11.2% of total assets, compared to 10.1% at March 31, 2008.   At March 31, 2009 the Company had a total risk-based capital ratio of 13.70%, a tier 1 risk-based capital ratio of 12.44% and a capital leverage ratio of 10.53% which were all above amounts needed in order to be categorized as “well capitalized” for regulatory purposes.

The provision for loan and lease losses totaled $10.6 million for the first quarter of 2009 compared to $2.7 million for the first quarter of 2008 and $17.8 million for the fourth quarter of 2008. As discussed above, these increases were primarily due to internal risk rating downgrades, charge-offs and additional specific reserves primarily related to loans in the residential real estate development portfolio.

Loan charge-offs, net of recoveries totaled $1.3 million for the first quarter of 2009 compared to net recoveries of $0.1 million for the first quarter of 2008 and net charge-offs of $5.5 million for the fourth quarter of 2008. The allowance for loan and lease losses represented 2.43% of outstanding loans and leases and 48% of non-performing assets at March 31, 2009 compared to 2.03% of outstanding loans and leases and 70% of non-performing assets at December 31, 2008 and 1.18% of outstanding loans and leases and 59% of non-performing assets at March 31, 2008.

Non-performing assets totaled $125.8 million at March 31, 2009 compared to $72.2 million at December 31, 2008 and $46.9 million at March 31, 2008. The increase over the fourth quarter of 2008 was due primarily to one commercial loan and four residential real estate development loans that together totaled $46.2 million. The increase over the prior year also includes four residential real estate development loans, in addition to the five loans mentioned above, totaling $11.4 million.  

Income Statement Review

Comparing the first quarter of 2009 and 2008, net interest income decreased by $1.5 million, or 6%, due primarily to the decline in market interest rates due to the effect of interest rate cuts by the Federal Reserve throughout 2008 and the growth in nonperforming assets mentioned above. Because of the competitive environment for deposits, loan and investment yields declined faster than rates paid on deposits. These factors produced a net interest margin decrease to 3.39% in 2009 from 3.99% in 2008.

Noninterest income decreased to $12.0 million in the first quarter of 2009 as compared to $12.7 million in the first quarter of 2008, a decrease of $0.7 million or 6%.  Service charges on deposit accounts decreased $0.2 million or 6% due primarily to lower overdraft fees while Visa check fees decreased $0.1 million or 8% compared to the first quarter of 2008. Fees on sales of investment products decreased $0.1 million or 15% and trust and investment management fees declined $0.1 million or 5%, both of which were due primarily to a decline in assets under management. These decreases were somewhat offset by an increase in gains on sales of mortgage loans of $0.3 million or 42% due largely to higher mortgage refinancing volumes reflecting market conditions. Other noninterest income also decreased $0.1 million or 7% compared to the first quarter of 2008.

Noninterest expenses were $24.3 million in the first quarter of 2009 compared to $24.7 million in the first quarter of 2008, a decrease of $0.4 million or 2%. Salaries and benefits expenses decreased $0.6 million or 4%, while marketing expenses decreased $0.1 million or 15% and expenses for outside data services decreased $0.3 million or 28% compared to the first quarter of 2008. These decreases were somewhat offset by an increase of $0.5 million or 13% in other noninterest expenses due to higher FDIC insurance premiums. The overall noninterest expense performance reflects the effect of stringent expense controls implemented as part of project LIFT.

Conference Call

The Company’s management will host a conference call to discuss its first quarter results today at 2:00 P.M. (ET).   A live Web cast of the conference call is available through the Investor Relations’ section of the Sandy Spring Web site at www.sandyspringbank.com.  Participants may call 877-795-3649; a password is not necessary.  Visitors to the Web site are advised to log on 10 minutes ahead of the scheduled start of the call.  An internet-based replay will be available at the Web site until 12:00 midnight (ET) May 21, 2009.  A telephone voice replay will also be available during that same time period at 888-203-1112.  Please use pass code #4925898 to access.

About Sandy Spring Bancorp/Sandy Spring Bank

With $3.5 billion in assets, Sandy Spring Bancorp is the holding company for Sandy Spring Bank and its principal subsidiaries, Sandy Spring Insurance Corporation, The Equipment Leasing Company and West Financial Services, Inc.  Sandy Spring Bancorp is the second largest publicly traded banking company headquartered in Maryland. Sandy Spring is a community banking organization that focuses its lending and other services on businesses and consumers in the local market area. Independent and community-oriented, Sandy Spring Bank was founded in 1868 and offers a broad range of commercial banking, retail banking and trust services through 42 community offices in Anne Arundel, Carroll, Frederick, Howard, Montgomery, and Prince George’s counties in Maryland, and Fairfax and Loudoun counties in Virginia. Through its subsidiaries, Sandy Spring Bank also offers a comprehensive menu of leasing, insurance and investment management services. Visit www.sandyspringbank.com to locate an ATM near you or for more information about Sandy Spring Bank.

For additional information or questions, please contact:

Daniel J. Schrider, President & Chief Executive Officer, or

Philip J. Mantua, E.V.P. & Chief Financial Officer

Sandy Spring Bancorp

17801 Georgia Avenue

Olney, Maryland 20832

1-800-399-5919

Email: DSchrider@sandyspringbank.com

PMantua@sandyspringbank.com

Web site:  www.sandyspringbank.com

Forward-Looking Statements

Sandy Spring Bancorp makes forward-looking statements in this news release and in the conference call regarding this news release.  These forward-looking statements may include: statements of goals, intentions, earnings expectations, and other expectations; estimates of risks and of future costs and benefits; assessments of probable loan and lease losses; assessments of market risk; and statements of the ability to achieve financial and other goals.

Forward-looking statements are typically identified by words such as “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project” and other similar words and expressions.  Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time.  Forward-looking statements speak only as of the date they are made.  Sandy Spring Bancorp does not assume any duty and does not undertake to update its forward-looking statements.  Because forward-looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those that Sandy Spring Bancorp anticipated in its forward-looking statements, and future results could differ materially from historical performance.

Sandy Spring Bancorp’s forward-looking statements are subject to the following principal risks and uncertainties: general economic conditions and trends, either nationally or locally; conditions in the securities markets; changes in interest rates; changes in deposit flows, and in the demand for deposit, loan, and investment products and other financial services; changes in real estate values; changes in the quality or composition of the Company’s loan or investment portfolios; changes in competitive pressures among financial institutions or from non-financial institutions; the Company’s ability to retain key members of management; changes in legislation, regulations, and policies; and a variety of other matters which, by their nature, are subject to significant uncertainties.  Sandy Spring Bancorp provides greater detail regarding some of these factors in its Form 10-K for the year ended December 31, 2008, including in the Risk Factors section of that report, and in its other SEC reports.  Sandy Spring Bancorp’s forward-looking statements may also be subject to other risks and uncertainties, including those that it may discuss elsewhere in this news release or in its filings with the SEC, accessible on the SEC’s Web site at www.sec.gov.

Sandy Spring Bancorp, Inc. and Subsidiaries

FINANCIAL HIGHLIGHTS (Unaudited)

(Dollars in thousands, except per share data)

	Three Months Ended
	March 31,						%
	2009			2008			Change
Profitability for the period:
Net interest income		$25,025			$26,579			(6	) %
Provision for loan and lease losses		10,613			2,667			298
Noninterest income		11,974			12,696			(6	)
Noninterest expenses		24,250			24,703			(2	)
Income before income taxes		2,136			11,905			(82	)
Net income		$2,217			$8,205			(73	)
Net income available to common shareholders		$1,017			$8,205			(88	)
Return on average assets (1)		0.12	%		1.07	%
Return on average common equity (1)		1.32	%		10.45	%
Net interest margin		3.39	%		3.99	%
Efficiency ratio - GAAP *		65.54	%		62.90	%
Efficiency ratio - Non-GAAP *		61.29	%		59.18	%
Per share data:
Basic net income per share		$0.14			$0.50			(72	) %
Basic net income per common share		0.06			0.50			(88	)
Diluted net income per share		0.13			0.50			(74	)
Diluted net income per common share		0.06			0.50			(88	)
Dividends declared per common share		0.12			0.24			(50	)
Book value per common share		19.06			19.50			(2	)
Average fully diluted shares		16,433,788			16,407,778
At period-end:
Assets		$3,519,432			$3,160,896			11	%
Deposits		2,553,912			2,340,568			9
Total loans and leases		2,461,845			2,364,023			4
Securities		661,169			434,987			52
Stockholders' equity		392,522			318,967			23
Capital and credit quality ratios:
Average equity to average assets		11.60	%		10.28	%
Allowance for loan and lease losses to loans and leases		2.43	%		1.18	%
Nonperforming assets to total assets		3.57	%		1.48	%
Annualized net charge-offs to average loans and leases		0.22	%		-0.02	%

(1) Calculation utilizes net income available to common shareholders

* The GAAP efficiency ratio is noninterest expenses divided by net interest income plus noninterest income from the Consolidated Statements of Income.The non-GAAP efficiency ratio excludes intangible asset amortization from noninterest expenses; excludes securities gains from noninterest income; and adds the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights.

Sandy Spring Bancorp, Inc. and Subsidiaries

Reconciliation of GAAP and Non-GAAP Efficiency Ratios (Unaudited)

(In thousands, except per share data)

	Three Months Ended
	March 31,
GAAP efficiency ratio:	2009			2008
Noninterest expenses–GAAP		$24,250			$24,703
Net interest income plus noninterest income		36,999			39,275
Efficiency ratio–GAAP		65.54	%		62.90	%
Non-GAAP efficiency ratio:
Noninterest expense		$24,250			$24,703
Less non-GAAP adjustment:
Amortization of intangible assets		1,055			1,124
Noninterest expenses– as adjusted		23,195			23,579
Net interest income plus noninterest income		36,999			39,275
Plus non-GAAP adjustment:
Tax-equivalency		1,009			1,140
Less non-GAAP adjustments:
Securities gains		162			574
Net interest income plus noninterest
income – as adjusted		37,846			39,841
Efficiency ratio – Non-GAAP		61.29	%		59.18	%

Sandy Spring Bancorp, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share data)

	March 31,						December 31,
	2009			2008			2008
Assets
Cash and due from banks		$46,380			$66,536			$44,738
Federal funds sold		392			48,032			1,110
Interest-bearing deposits with banks		126,286			11,112			59,381
Cash and cash equivalents		173,058			125,680			105,229
Residential mortgage loans held for sale (at fair value)		14,515			9,876			11,391
Investments available-for-sale (at fair value)		472,161			206,840			291,727
Investments held-to-maturity - fair value of $163,009, 209,937
and $175,908, respectively		156,877			202,344			171,618
Other equity securities		32,131			25,803			29,146
Total loans and leases		2,461,845			2,364,023			2,490,646
Less:  allowance for loan and lease losses		(59,798	)		(27,887	)		(50,526	)
Net loans and leases		2,402,047			2,336,136			2,440,120
Premises and equipment, net		50,981			53,780			51,410
Other real estate owned		5,093			661			2,860
Accrued interest receivable		11,937			13,201			11,810
Goodwill		76,816			78,111			76,248
Other intangible assets, net		11,128			15,507			12,183
Other assets		112,688			92,957			109,896
Total assets		$3,519,432			$3,160,896			$3,313,638
Liabilities
Noninterest-bearing deposits		$545,540			$445,088			$461,517
Interest-bearing deposits		2,008,372			1,895,480			1,903,740
Total deposits		2,553,912			2,340,568			2,365,257
Short-term borrowings		487,900			372,625			421,074
Long-term borrowings		16,340			67,312			66,584
Subordinated debentures		35,000			35,000			35,000
Accrued interest payable and other liabilities		33,758			26,424			33,861
Total liabilities		3,126,910			2,841,929			2,921,776
Stockholders' Equity
Preferred stock -- par value $1.00 (liquidation preference of $1,000
per share ) shares authorized 83,094, 0 and 83,094, respectively;
shares issued and outstanding 83,094, 0 and 83,094, respectively
(discount of $3,493, 0 and $3,654, respectively)		79,601			0			79,440
Common stock -- par value $1.00; shares authorized 49,916,906,
50,000,000 and 49,916,906, respectively; shares issued and
outstanding 16,414,523, 16,361,444 and 16,398,523, respectively		16,415			16,361			16,399
Warrants		3,699			0			3,699
Additional paid in capital		85,820			84,281			85,486
Retained earnings		213,453			219,019			214,410
Accumulated other comprehensive loss		(6,466	)		(694	)		(7,572	)
Total stockholders' equity		392,522			318,967			391,862
Total liabilities and stockholders' equity		$3,519,432			$3,160,896			$3,313,638

Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(In thousands, except per share data)	Three Months Ended
	March 31,
	2009			2008
Interest income:
Interest and fees on loans and leases		$33,233			$38,469
Interest on loans held for sale		280			96
Interest on deposits with banks		46			49
Interest and dividends on securities:
Taxable		3,195			2,698
Exempt from federal income taxes		1,972			2,331
Interest on federal funds sold		2			279
Total interest income		38,728			43,922
Interest expense:
Interest on deposits		9,454			13,022
Interest on short-term borrowings		3,446			3,279
Interest on long-term borrowings		803			1,042
Total interest expense		13,703			17,343
Net interest income		25,025			26,579
Provision for loan and lease losses		10,613			2,667
Net interest income after provision for loan and lease losses		14,412			23,912
Noninterest income:
Securities gains		162			574
Service charges on deposit accounts		2,863			3,030
Gains on sales of mortgage loans		1,022			722
Fees on sales of investment products		700			822
Trust and investment management fees		2,287			2,397
Insurance agency commissions		2,050			2,086
Income from bank owned life insurance		711			714
Visa check fees		638			696
Other income		1,541			1,655
Total noninterest income		11,974			12,696
Noninterest expenses:
Salaries and employee benefits		13,204			13,763
Occupancy expense of premises		2,775			2,799
Equipment expenses		1,514			1,439
Marketing		420			497
Outside data services		806			1,122
Amortization of intangible assets		1,055			1,124
Other expenses		4,476			3,959
Total noninterest expenses		24,250			24,703
Income before income taxes		2,136			11,905
Income tax expense (benefit)		(81	)		3,700
Net income		$2,217			$8,205
Preferred stock dividends and discount accretion		1,200			0
Net income available to common shareholders		$1,017			$8,205
Basic net income per share		$0.14			$0.50
Basic net income per common share		0.06			0.50
Diluted net income per share		0.13			0.50
Diluted net income per common share		0.06			0.50
Dividends declared per common share		0.12			0.24

Sandy Spring Bancorp, Inc. and Subsidiaries
Historical Trends in Quarterly Financial Data (Unaudited)	2009			2008
(Dollars in thousands, except per share data)		Q1			Q4		Q3		Q2		Q1
Profitability for the quarter:
Tax-equivalent interest income		$39,737			$42,194		$43,228		$42,906		$45,062
Interest expense		13,703			14,356		13,961		14,726		17,343
Tax-equivalent net interest income		26,034			27,838		29,267		28,180		27,719
Tax-equivalent adjustment		1,009			1,164		1,180		1,061		1,140
Provision for loan and lease losses		10,613			17,791		6,545		6,189		2,667
Noninterest income		11,974			10,973		10,879		11,695		12,696
Noninterest expenses		24,250			27,233		25,267		24,886		24,703
Income (loss) before income taxes		2,136			(7,377	)	7,154		7,739		11,905
Income tax expense (benefit)		(81	)		(3,941	)	1,795		2,088		3,700
Net Income (loss)		2,217			(3,436	)	5,359		5,651		8,205
Net Income (loss) available to common shareholders		1,017			(3,770	)	5,359		5,651		8,205
Financial ratios:
Return on average assets		0.12	%		-0.42	%	0.67	%	0.73	%	1.07	%
Return on average common equity		1.32	%		-4.70	%	6.64	%	7.09	%	10.45	%
Net interest margin		3.39	%		3.73	%	4.02	%	3.96	%	3.99	%
Efficiency ratio - GAAP*		65.54	%		72.34	%	64.84	%	64.11	%	62.90	%
Efficiency ratio - Non-GAAP *		61.29	%		62.41	%	58.27	%	59.73	%	59.18	%
Per share data:
Basic net income per share		$0.14			$(0.21	)	$0.33		$0.35		$0.50
Basic net income per common share		$0.06			$(0.23	)	$0.33		$0.35		$0.50
Diluted net income per share		$0.13			$(0.21	)	$0.33		$0.34		$0.50
Diluted net income per common share		$0.06			$(0.23	)	$0.33		$0.34		$0.50
Dividends declared per common share		$0.12			$0.24		$0.24		$0.24		$0.24
Book value per common share		$19.06			$19.05		$19.51		$19.56		$19.50
Average fully diluted shares		16,433,788			16,434,214		16,418,588		16,427,213		16,407,778
Noninterest income breakdown:
Securities gains		$162			$1		$9		$79		$574
Service charges on deposit accounts		2,863			3,297		3,249		3,202		3,030
Gains on sales of mortgage loans		1,022			516		397		653		722
Fees on sales of investment products		700			928		820		905		822
Trust and investment management fees		2,287			2,201		2,380		2,505		2,397
Insurance agency commissions		2,050			1,183		1,282		1,357		2,086
Income from bank owned life insurance		711			719		742		727		714
Visa check fees		638			691		727		761		696
Other income		1,541			1,437		1,273		1,506		1,655
Total		11,974			10,973		10,879		11,695		12,696
Noninterest expense breakdown:
Salaries and employee benefits		$13,204			$13,441		$11,949		$13,862		$13,763
Occupancy expense of premises		2,775			2,612		2,732		2,619		2,799
Equipment expenses		1,514			1,642		1,515		1,560		1,439
Marketing		420			652		526		488		497
Outside data services		806			1,054		1,116		1,081		1,122
Amortization of intangible assets		1,055			1,103		1,103		1,117		1,124
Goodwill impairment loss		0			1,909		2,250		0		0
Other expenses		4,476			4,820		4,076		4,159		3,959
Total		24,250			27,233		25,267		24,886		24,703

* The GAAP efficiency ratio is noninterest expenses divided by net interest income plus noninterest income from the Consolidated Statements of Income.The non-GAAP efficiency ratio excludes intangible asset amortization expenses from noninterest expenses; excludes security gains from noninterest income; and adds the tax-equivalent adjustment to net interest income.  See the Reconciliation Table included with these Historical Trends in Quarterly Financial Data.

Sandy Spring Bancorp, Inc. and Subsidiaries
Historical Trends in Quarterly Financial Data (Unaudited)	2009			2008
(Dollars in thousands, except per share data)		Q1			Q4		Q3		Q2		Q1
Balance sheets at quarter end:
Residential mortgage loans		$461,359			$457,571		$452,815		$461,000		$459,768
Residential construction loans		163,861			189,249		221,630		199,602		183,690
Commercial mortgage loans		859,882			847,452		804,728		752,905		732,692
Commercial construction loans		222,805			223,169		247,930		273,059		256,714
Commercial loans and leases		342,870			366,978		358,097		356,256		354,509
Consumer loans		411,068			406,227		397,218		386,126		376,650
Total loans and leases		2,461,845			2,490,646		2,482,418		2,428,948		2,364,023
Less: allowance for loan and lease losses		(59,798	)		(50,526	)	(38,266	)	(33,435	)	(27,887	)
Net loans and leases		2,402,047			2,440,120		2,444,152		2,395,513		2,336,136
Goodwill		76,816			76,248		75,701		78,376		78,111
Other intangible assets, net		11,128			12,183		13,286		14,390		15,507
Total assets		3,519,432			3,313,638		3,195,117		3,164,123		3,160,896
Total deposits		2,553,912			2,365,257		2,248,812		2,294,791		2,340,568
Customer repurchase agreements		91,928			75,106		77,630		93,919		101,666
Total stockholders' equity		392,522			391,862		319,700		320,218		318,967
Quarterly average balance sheets:
Residential mortgage loans		$481,721			$457,956		$463,778		$462,858		$463,597
Residential construction loans		176,811			208,616		210,363		193,822		174,626
Commercial mortgage loans		854,402			833,752		779,652		733,905		690,289
Commercial construction loans		224,229			236,176		253,806		261,360		266,098
Commercial loans and leases		359,820			361,731		356,327		359,287		351,862
Consumer loans		408,843			400,937		391,640		380,911		378,261
Total loans and leases		2,505,826			2,499,168		2,455,566		2,392,143		2,324,733
Securities		536,981			431,858		423,082		431,182		427,819
Total earning assets		3,117,590			2,972,173		2,898,968		2,862,012		2,795,453
Total assets		3,375,715			3,235,432		3,167,145		3,134,440		3,072,428
Total interest-bearing liabilities		2,471,762			2,405,890		2,363,299		2,344,266		2,311,629
Noninterest-bearing demand deposits		476,361			458,538		453,281		441,330		412,369
Total deposits		2,431,471			2,305,880		2,264,990		2,306,867		2,260,837
Customer repurchase agreements		69,212			84,012		81,158		92,968		94,841
Stockholders' equity		391,673			342,639		321,028		320,409		315,755
Capital and credit quality measures:
Average equity to average assets		11.60	%		10.59	%	10.14	%	10.22	%	10.28	%
Allowance for loan and lease losses to loan and leases		2.43	%		2.03	%	1.54	%	1.38	%	1.18	%
Nonperforming assets to total assets		3.57	%		2.18	%	2.14	%	2.05	%	1.48	%
Annualized net charge-offs (recoveries) to
average loans and leases		0.22	%		0.88	%	0.28	%	0.11	%	(0.02	)%
Miscellaneous data:
Net charge-offs (recoveries)		$1,341			$5,531		$1,714		$642		$(129	)
Nonperforming assets:
Non-accrual loans and leases		110,761			67,950		64,246		60,373		37,353
Loans and leases 90 days past due		9,545			1,038		2,074		2,538		8,244
Restructured loans and leases		395			395		395		655		655
Other real estate owned, net		5,094			2,860		1,698		1,352		661
Total nonperforming assets		125,795			72,243		68,413		64,918		46,913

Sandy Spring Bancorp, Inc. and Subsidiaries

CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES (Unaudited)

(Dollars in thousands and tax-equivalent)

	Three Months Ended March 31,
	2009								2008
						Annualized								Annualized
	Average					Average			Average					Average
	Balances			Interest		Yield/Rate			Balances			Interest		Yield/Rate
Assets
Residential mortgage loans		$481,721			$7,185		5.97	%		$463,597			$7,296		6.30	%
Residential construction loans		176,811			2,372		5.44			174,626			2,770		6.38
Commercial mortgage loans		854,402			13,266		6.30			690,289			11,848		6.90
Commercial construction loans		224,229			1,821		3.29			266,098			4,426		6.69
Commercial loans and leases		359,820			4,845		5.45			351,862			6,546		7.48
Consumer loans		408,843			4,024		3.99			378,261			5,679		6.04
Total loans and leases		2,505,826			33,513		5.41			2,324,733			38,565		6.66
Securities*		536,981			6,176		4.74			427,819			6,169		5.84
Interest-bearing deposits with banks		71,571			46		0.26			6,949			49		2.81
Federal funds sold		3,212			2		0.24			35,952			279		3.12
TOTAL EARNING ASSETS		3,117,590			39,737		5.17	%		2,795,453			45,062		6.48	%
Less:  allowance for loan and lease losses		(53,416	)							(25,844	)
Cash and due from banks		47,023								50,160
Premises and equipment, net		51,408								54,364
Other assets		213,110								198,295
Total assets		$3,375,715								$3,072,428
Liabilities and Stockholders' Equity
Interest-bearing demand deposits		$242,799			$121		0.20	%		$241,177			$171		0.28	%
Regular savings deposits		147,537			55		0.15			153,365			120		0.32
Money market savings deposits		713,295			2,416		1.37			709,009			4,667		2.65
Time deposits		851,479			6,863		3.27			744,917			8,064		4.35
Total interest-bearing deposits		1,955,110			9,455		1.96			1,848,468			13,022		2.83
Borrowings		516,652			4,248		3.33			463,161			4,321		3.75
TOTAL INTEREST-BEARING LIABILITIES		2,471,762			13,703		2.25			2,311,629			17,343		3.01
Noninterest-bearing demand deposits		476,361								412,369
Other liabilities		35,917								32,675
Stockholder's equity		391,675								315,755
Total liabilities and stockholders' equity		$3,375,715								$3,072,428
Net interest income and spread on a fully tax
equivalent basis					26,034		2.92	%					27,719		3.47	%
Less: tax equivalent adjustment					1,009								1,140
Net interest income					25,025								26,579
Interest income/earning assets							5.17	%							6.48	%
Interest expense/earning assets							1.78								2.49
Net interest margin							3.39	%							3.99	%

*Interest income includes the effects of annualized taxable-equivalent adjustments (reduced by the nondeductible portion of interest expense) using the appropriate marginal federal income tax rate of 35.00% and, where applicable, the marginal state income tax rate of 7.50% (or a combined marginal federal and state rate of 39.88%) for 2009 and 2008, to increase tax-exempt interest income to a taxable-equivalent basis.  The annualized taxable-equivalent adjustment amounts utilized in the above table to compute yields aggregated to $4.1 million in 2009 and $4.6 million in 2008.