Basis of Presentation

The accompanying unaudited interim consolidated financial statements of Union Bankshares, Inc. and Subsidiary (together, the Company) as of March 31, 2020, and for the three months ended March 31, 2020 and 2019, have been prepared in conformity with GAAP for interim financial information, general practices within the banking industry, and the accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (2019 Annual Report). The Company's sole subsidiary is Union Bank. In the opinion of the Company’s management, all adjustments, consisting only of normal recurring adjustments and disclosures necessary for a fair presentation of the information contained herein, have been made. This information should be read in conjunction with the Company’s 2019 Annual Report. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2020, or any future interim period.

The Company is a “smaller reporting company” and as permitted under the rules and regulations of the SEC, has elected to provide its consolidated statements of income, comprehensive income, cash flows and changes in stockholder’ equity for a two year, rather than three year, period. The Company has also elected to provide certain other scaled disclosures in this report, as permitted for smaller reporting companies.

Certain amounts in the 2019 consolidated financial statements have been reclassified to conform to the 2020 presentation.

On May 7, 2020, Union Bankshares, Inc. distributed its First Quarter 2020 unaudited Report to Shareholders presenting information concerning the Company's results of operations and financial condition for the three months ended March 31, 2020. Subsequent to the compilation of this report, the gain or loss on other investments has been reclassified from dividend income to noninterest income for both the March 31, 2020 and 2019 comparison periods.

In addition to the definitions set forth elsewhere in this report, the acronyms, abbreviations and capitalized terms identified below are used throughout this Form 10-Q, including Part I. "Financial Information" and Part II. "Other Information". The following is provided to aid the reader and provide a reference page when reviewing this Form 10-Q.



AFS:	Available-for-sale	MBS:	Mortgage-backed security
ALCO:	Asset Liability Committee	MSRs:	Mortgage servicing rights
ALL:	Allowance for loan losses	OAO:	Other assets owned
ASC:	Accounting Standards Codification	OCI:	Other comprehensive income (loss)
ASU:	Accounting Standards Update	OFAC:	U.S. Office of Foreign Assets Control
Board:	Board of Directors	OREO:	Other real estate owned
bp or bps:	Basis point(s)	OTTI:	Other-than-temporary impairment
Branch Acquisition:	The acquisition of three New Hampshire branches in May 2011	OTT:	Other-than-temporary
CARES Act:	Coronavirus Aid, Relief and Economic Security Act	Plan:	The Union Bank Pension Plan
CDARS:	Certificate of Deposit Accounts Registry Service of the Promontory Interfinancial Network	PPP:	Paycheck Protection Program
Company:	Union Bankshares, Inc. and Subsidiary	PPPLF:	PPP Liquidity Facility of the FRB
COVID-19:	Novel Coronavirus	RD:	USDA Rural Development
DRIP:	Dividend Reinvestment Plan	RSU:	Restricted Stock Unit
FASB:	Financial Accounting Standards Board	SBA:	U.S. Small Business Administration
FDIC:	Federal Deposit Insurance Corporation	SEC:	U.S. Securities and Exchange Commission
FHA:	U.S. Federal Housing Administration	TDR:	Troubled-debt restructuring
FHLB:	Federal Home Loan Bank of Boston	Union:	Union Bank, the sole subsidiary of Union Bankshares, Inc
FRB:	Federal Reserve Board	USDA:	U.S. Department of Agriculture
FHLMC/Freddie Mac:	Federal Home Loan Mortgage Corporation	VA:	U.S. Veterans Administration
GAAP:	Generally Accepted Accounting Principles in the United States	WHO:	World Health Organization
HTM:	Held-to-maturity	2008 ISO Plan:	2008 Incentive Stock Option Plan of the Company
HUD:	U.S. Department of Housing and Urban Development	2014 Equity Plan:	2014 Equity Incentive Plan
ICS:	Insured Cash Sweeps of the Promontory Interfinancial Network	2019 Annual Report	Annual Report of Form 10-K for the year ended December 31, 2019
IRS:	Internal Revenue Service	2017 Tax Act:	Tax Cut and Jobs Act of 2017