BLOOMINGTON, IN –Monroe Bancorp (NASDAQ: MROE) reported record earnings for 2001 of $5,749,000 or $0.94 per share, a 7.8 percent increase over the Company's 2000 earnings.

"We are very proud of our 2001 performance," said President and Chief Executive Officer Mark D. Bradford. "We were able to increase the Company's net income by 7.8 percent during a year when we were confronted with a significant economic downturn and the expense of expanding into Hendricks County. We were able to accomplish this goal primarily through strong loan growth, and increased fee income from investment sales, mortgage origination, and deposit services." Mr. Bradford also stated that, "This success is a direct result of our focus on providing outstanding customer service, our commitment to support the communities in which we operate, and our efforts to build lasting relationships with our customers."

Highlights of the year include:

• Market Expansion - The Company's plan to expand its franchise by entering the rapidly growing Hendricks County market has started well. The Bank's first Hendricks County banking center opened in September (in Avon) and the second location (in Plainfield) opened in October. As of December 31, 2001 total loans for the two locations totaled $17,129,000 and total deposits were $11,574,000. Both results exceeded the Company’s end of year forecasts.
  
• Strong Loan Growth - Total loans grew by $75,041,000 during 2001, a 25.3 percent increase over year-end 2000. The Company had total gross loans of $371,800,000 as of December 31, 2001.
  
• Strong Credit Quality – Despite the economic downturn, the Company preserved a strong credit quality while rapidly growing total loans. The percentage of total loans which were past due by 30 or more days was 1.24 percent as of year-end 2001, compared to 1.88 percent as of year-end 2000. Total non-performing assets and 90-day past due loans were $3,684,000 as of year-end 2001, down from $3,819,000 at year-end 2000. Year-end 2001 nonperforming and 90-day past due loans represent 0.74 percent of total assets, which compares favorably to the December 31, 2000 figure of 0.86 percent.
  
• Provision for Loan Losses - The Company took an additional provision for loan losses of $250,000 during the fourth quarter to ensure that the Bank's allowance remains at a level appropriate to the portfolio's growth rate. This resulted in the Company’s provision for loan losses increasing from $720,000 in 2000 to $1,050,000 in 2001. The Bank's ratio of allowance for loan losses to total loans at year-end 2001 was 1.13 percent. If $8,032,000 of loans with firm commitments to be sold at December 31, 2001 were removed from the calculation, the ratio would be 1.15 percent.
  
• Mortgage Originations and Sales of Fixed Rate Loans -Aided by a low interest rate environment, the Company’s mortgage department originated $56,679,000 in fixed rate, single-family mortgages during 2001. Sales of these loans into the secondary market resulted in $515,000 of fee income, compared to $200,000 in 2000.
  
• Banking Center-based Investment Sales - The Company's initiative to train and license front-line sales staff to offer both securities and insurance products generated $14,219,000 in investment sales through December 31, 2001. These sales provided $572,000 in fee income, compared to $438,000 in 2000.
  
• Listing on NASDAQ - Monroe Bancorp common stock was listed on the NASDAQ National Market effective on May 30, 2001.
  
• Check Imaging - The Company's new check imaging capability is yielding the expected improvements in customer service and operating efficiency.

“ We are pleased with the results of our 2001 business plans and are looking forward to building upon our successes in 2002," continued Mr. Bradford. "Our new, expanded banking facility on Bloomington’s west side will be built and ready for business in February 2002. With an increased number of drive-up lanes, a teller window dedicated solely to commercial transactions, a full-time mortgage loan officer and a full-time investment advisor added to the already established teller and customer service staff, the new Highland Village Banking center will be able to serve the needs of that burgeoning community in ways that the 36-year-old banking center building it is replacing could not.”

In addition, the Company continues with its market expansion plan, with work underway on a third Hendricks County banking center. Located in Brownsburg, this banking center will join the locations in Plainfield and Avon in providing commercial and personal banking and investment services to the fast-growing area of Central Indiana.

Monroe Bancorp, headquartered in Bloomington, Indiana, is an Indiana bank holding company with 15 banking offices and 14 ATMs in Monroe, Jackson, Lawrence and Hendricks counties. Its wholly owned subsidiary, Monroe Bank, was established in Bloomington, Indiana in 1892, and offers a full range of financial, trust and investment services to its more than 20,000 retail and commercial customers. The Company's common stock is traded on the NASDAQ National Stock Market under the symbol MROE.

See attachment for additional financial information. For further information, contact: Mark D. Bradford, President and Chief Executive Officer.

Forward-looking Statements
This release contains forward-looking statements about the Company which we believe are within the meaning of the Private Securities Litigation Reform Act of 1995. This release contains certain forward-looking statements with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words "believe," "expect," "anticipate," "intend," "plan," "estimate" or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could" or "may" or words of similar meaning. These forward-looking statements, by their nature, are subject to risks and uncertainties. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors that might cause such a difference include, but are not limited to: (1) competitive pressures among depository institutions increase significantly; (2) changes in the interest rate environment reduce interest margins; (3) prepayment speeds, charge-offs and loan loss provisions; (4) general economic conditions, either national or in the markets in which the Company does business, are less favorable than expected; (5) legislative or regulatory changes adversely affect the business of the Company; and (6) changes in real estate values or the real estate markets. Further information on other factors which could affect the financial results of the Company are included in the Company's filings with the Securities and Exchange Commission.