**FOR
                IMMEDIATE RELEASE****For
                More Information:**Jim
                Delamater, President & CEO
              Northeast
                Bank, 500 Canal Street, Lewiston, ME 04240www.northeastbank.com
            1-800-284-5989
                ext. 3569
jdelamater@northeastbank.com




**Northeast
      Bancorp Announces 3rd Quarter Earnings**


**and
      Quarterly Dividend**




Lewiston, **MAINE** (April
      24, 2007) - Northeast Bancorp (AMEX: NBN), the parent company of Northeast
      Bank,
      reported earnings for the quarter ended March 31, 2007 of $524,967, or $0.21
      per
      diluted share, as compared to earnings for the same period last year of
      $873,741, or $0.35 per diluted share. Earnings for the nine-month period ended
      March 31, 2007 were $1,396,991, or $0.57 per diluted share, representing a
      decrease of 53% from earnings for the same period last year which were
      $2,987,034, or $1.17 per diluted share.




The
      decrease in earnings resulted primarily from the continued themes of decreased
      net interest income, primarily attributable to a compression of net interest
      margin, and higher operating expenses, primarily attributable to the Company’s
      expansion strategies to grow noninterest income. Core deposit growth has been
      adversely affected by area competition and by significantly higher rates offered
      in regional and national markets, as well as via the Internet. Consequently,
      the
      cost of funds is increasing more rapidly than the yield on earning
      assets.




“Growing
      core bank earnings continues to be a challenge,” said Jim Delamater, President
      and CEO of Northeast Bancorp. “But, still, we are experiencing excellent growth
      in our noninterest income, which now represents in excess of approximately
      30%
      of total income. Our focus on the sale of multiple financial products and
      services to our customers provides our organization with a high level of product
      and income diversity.”




“In
      addition, we’ve enhanced our ability to provide outlets for competitive loan
      products that effectively serve both the commercial and the consumer customer,
      resulting in significant increases in our gain on loan sales,” continued
      Delamater.




In
      light
      of the ongoing flat interest rate environment, the Company continued to
      experience growth in noninterest income, specifically in the areas of gain
      on
      loan sales and trust, investment, and insurance income, partially offsetting
      a
      decrease in net interest income. Total noninterest income increased to
      $2,471,977 for the quarter ended March 31, 2007, as compared to $1,844,476
      for
      the same period in 2006, an increase of 34%.




During
      the past quarter, the Company also reported it acquired Southern Maine Insurance
      Agency, located in Scarborough, Maine, which added $3.6 million in projected
      policy premiums and brought the number of insurance offices to
      eleven.




In
      addition, the Board of Directors declared a dividend of $0.09 per share payable
      on May 25, 2007 to shareholders of record as of the close of business on May
      4,
      2007. As of March 31, 2007, Northeast Bancorp had total assets of approximately
      $562 million. Northeast Bancorp common shares trade on the American Stock
      Exchange with approximately 2.4 million shares outstanding and, as of March
      31,
      2007, had a book value of $16.97 per share, an increase from $16.08 at the
      end
      of the same period last year.




Delamater
      said, “We continue to be mindful of the quality of our balance sheet and the
      integrity of our pricing strategies. It is our belief that our value is derived
      by the strength of our revenue streams, our balance sheet and credit quality,
      and foremost, our ability to serve our markets from 23 retail outlets and
      deliver a broad range of financial products and services, including investment,
      insurance, wealth management, with traditional banking at our core. We truly
      have created a full-service financial institution.”




Northeast
      Bancorp, headquartered at 500 Canal Street, Lewiston, ME 04240, is the holding
      company for the Maine-based Northeast Bank, founded in 1872. Northeast Bank,
      together with its wholly-owned subsidiary, Northeast Bank Insurance Group,
      Inc.,
      operates retail and insurance outlets in western, central, and mid-coastal
      Maine
      and derives its income from a combination of traditional banking services and
      non-traditional financial products and services including insurance and
      investments.




Management
      encourages present and prospective shareholders to contact President and CEO
      Jim
      Delamater directly to discuss the Company, its products and services, and
      ongoing efforts to develop shareholder value. He can be reached at
      jdelamater@northeastbank.com or toll free at 1-800-284-5989. Management also
      suggests that any person wishing to utilize the services of Northeast Bancorp
      or
      its subsidiaries or interested in learning more about the Company can access
      its
      web site at www.northeastbank.com .




This
      communication contains certain “forward-looking statements”. Although the
      Company believes that these forward-looking statements are based on reasonable
      estimates and assumptions, they are not guarantees of future performance and
      are
      subject to known and unknown risks, uncertainties, and other factors. These
      statements speak only as of the date of this report and we do not undertake
      any
      obligation to update or revise any of these forward-looking statements to
      reflect events or circumstances occurring after the date of this communication
      or to reflect the occurrence of unanticipated events. For a more complete
      discussion of certain risks and uncertainties affecting the Company, please
      see
      "Item 1. Business Forward-Looking Statements and Risk Factors" set forth in
      the
      Company's Form 10-K for the year ended June 30, 2006.




Customer
      access to securities is provided through Commonwealth Financial Network, Member
      NASD/SIPC. **Important
      information--Securities, annuities, and insurance products are not deposit
      products, not FDIC insured, are subject to investment risk, including the
      possible loss of principal, and are not an obligation of or guaranteed by the
      Bank.**




**NORTHEAST
                  BANCORP**(Dollars
                  in Thousands, Except Per Share and Shares Outstanding
                  Data)(Unaudited)Three
                  Months Ended
              
              
              
              Nine
                  Months EndedMarch
                  31,
              
              %
              
              March
                  31,
              
              %2007
              
              2006
              
              Change
              
              2007
              
              2006
              
              ChangeSelected
                  financial informationIncome
                  statement data:Interest
                  income
              
              $
              8,738
              
              $
              8,610
              
              
              1
              %
              $
              26,662
              
              $
              26,057
              
              
              2
              %Interest
                  expense
              
              
              5,028
              
              
              4,181
              
              
              20
              %
              
              14,969
              
              
              12,163
              
              
              23
              %Net
                  interest income
              
              
              3,710
              
              
              4,429
              
              
              -16
              %
              
              11,693
              
              
              13,894
              
              
              -16
              %Provision
                  for loan losses
              
              
              200
              
              
              325
              
              
              -38
              %
              
              876
              
              
              926
              
              
              -5
              %Net
                  interest income afterprovision
                  for loan losses
              
              
              3,510
              
              
              4,104
              
              
              -14
              %
              
              10,817
              
              
              12,968
              
              
              -17
              %Gain
                  on sale of loans
              
              
              418
              
              
              47
              
              
              789
              %
              
              659
              
              
              214
              
              
              208
              %Gain
                  on securities
              
              
              8
              
              
              2
              
              
              300
              %
              
              31
              
              
              11
              
              
              182
              %Other
                  noninterest income
              
              
              2,046
              
              
              1,796
              
              
              14
              %
              
              5,265
              
              
              4,727
              
              
              11
              %Noninterest
                  expense
              
              
              5,265
              
              
              4,692
              
              
              12
              %
              
              14,899
              
              
              13,535
              
              
              10
              %Operating
                  income before income tax
              
              
              717
              
              
              1,257
              
              
              -43
              %
              
              1,873
              
              
              4,385
              
              
              -57
              %Income
                  tax expense
              
              
              192
              
              
              383
              
              
              -50
              %
              
              476
              
              
              1,398
              
              
              -66
              %Net
                  income
              
              $
              525
              
              $
              874
              
              
              -40
              %
              $
              1,397
              
              $
              2,987
              
              
              -53
              %Per
                  share data:Basic
                  earning per common share
              
              $
              0.21
              
              $
              0.35
              
              
              -40
              %
              $
              0.57
              
              $
              1.19
              
              
              -52
              %Diluted
                  earnings per common share
              
              $
              0.21
              
              $
              0.35
              
              
              -40
              %
              $
              0.57
              
              $
              1.17
              
              
              -51
              %Weighted
                  average shares outstanding:Basic
              
              
              2,452,632
              
              
              2,479,835
              
              
              -1
              %
              
              2,451,298
              
              
              2,509,718
              
              
              -2
              %Diluted
              
              
              2,471,476
              
              
              2,509,369
              
              
              -2
              %
              
              2,471,156
              
              
              2,543,791
              
              
              -3
              %Book
                  value per share
              
              
              16.97
              
              
              16.08
              
              
              
              
              
              16.97
              
              
              16.08Tangible
                  book value per share
              
              
              14.33
              
              
              15.10
              
              
              
              
              
              14.33
              
              
              15.10Net
                  interest margin
              
              
              2.91
              %
              
              3.40
              %
              
              
              
              
              2.97
              %
              
              3.44
              %Net
                  interest spread
              
              
              2.42
              %
              
              2.97
              %
              
              
              
              
              2.58
              %
              
              3.11
              %Return
                  on average assets (annualized)
              
              
              0.38
              %
              
              0.63
              %
              
              
              
              
              0.33
              %
              
              0.70
              %Return
                  on equity (annualized)
              
              
              5.13
              %
              
              8.80
              %
              
              
              
              
              4.55
              %
              
              9.82
              %Tier
                  I leverage ratio (Bank)
              
              
              8.65
              %
              
              8.92
              %
              
              
              
              
              8.65
              %
              
              8.92
              %Tier
                  I risk-based capital ratio (Bank)
              
              
              11.53
              %
              
              11.98
              %
              
              
              
              
              11.53
              %
              
              11.98
              %Total
                  risk-based capital ratio (Bank)
              
              
              12.78
              %
              
              13.23
              %
              
              
              
              
              12.78
              %
              
              13.23
              %Efficiency
                  ratio
              
              
              85
              %
              
              75
              %
              
              
              
              
              84
              %
              
              72
              %Nonperforming
                  loans
              
              
              4,570
              
              
              8,226
              
              
              
              
              
              4,570
              
              
              8,226Total
                  nonperforming assets
              
              
              4,570
              
              
              8,227
              
              
              
              
              
              4,570
              
              
              8,227Nonperforming
                  loans as a % of total loans
              
              
              1.07
              %
              
              1.88
              %
              
              
              
              
              1.07
              %
              
              1.88
              %Nonperforming
                  assets as a % of total assets
              
              
              0.81
              %
              
              1.47
              %
              
              
              
              
              0.81
              %
              
              1.47
              %March
                  31,
              
              %2007
              
              
              2006
              
              
              ChangeBalance
                  sheet highlights:Available
                  for sale securities, at market
              
              $
              80,453
              
              $
              83,492
              
              
              -4
              %Loans
                  held for sale
              
              
              5,049
              
              
              358
              
              
              1310
              %Loans
              
              
              425,682
              
              
              437,080
              
              
              -3
              %Allowance
                  for loan losses
              
              
              5,756
              
              
              5,447
              
              
              6
              %Total
                  assets
              
              
              562,113
              
              
              561,036
              
              
              0
              %Deposits:NOW
                  and money market
              
              
              64,274
              
              
              71,747
              
              
              -10
              %Savings
              
              
              21,484
              
              
              27,271
              
              
              -21
              %Certificates
                  of deposits
              
              
              224,612
              
              
              204,052
              
              
              10
              %Brokered
                  time deposits
              
              
              36,511
              
              
              42,561
              
              
              -14
              %Noninterest-bearing
                  deposits
              
              
              35,565
              
              
              37,766
              
              
              -6
              %Total
                  deposits
              
              
              382,446
              
              
              383,397
              
              
              0
              %Borrowings
              
              
              100,441
              
              
              101,460
              
              
              -1
              %Shareholders'
                  equity
              
              
              41,622
              
              
              39,303
              
              
              6
              %Shares
                  outstanding
              
              
              2,452,632
              
              
              2,444,132
              
              
              0
              %