Loaded Baked Potato Casserole

1 (22-oz.) package frozen mashed potatoes
1 (6.5-oz.) container garlic-and-herb spreadable cheese
1/2 cup milk
4 cooked bacon slices, crumbled
1 teaspoon salt
1/2 teaspoon pepper
1 cup (4 oz.) shredded Cheddar cheese
Garnish: chopped fresh chives

Prepare potatoes according to package directions.

Stir in spreadable cheese and next 4 ingredients; stir until blended. Spread mixture on bottom of a lightly-greased 11- x 7-inch baking dish; top with Cheddar cheese.

Bake at 350° for 25 to 30 minutes or until thoroughly heated. Garnish, if desired.