EASTON,
Md., May 2, 2024 /PRNewswire/ -- Shore
Bancshares, Inc. (NASDAQ - SHBI) (the "Company" or "Shore
Bancshares"), the holding company for Shore United Bank, N.A. (the
"Bank" or "SUB") reported net income for the first quarter of 2024
of $8.2 million or $0.25 per diluted common share compared to a net
income of $10.5 million or
$0.32 per diluted common share for
the fourth quarter of 2023, and net income of $6.5 million or $0.32 per diluted common share for the first
quarter of 2023.
First Quarter 2024 Highlights
- Credit Card Fraud - On April 2, 2024, the Bank detected that it had been
subjected to fraudulent credit card account openings during the
first quarter of 2024 and commenced an investigation. Bad actors
used stolen personal information to open Bank-issued credit cards
through the Bank's online credit card activation system. The
personal information used had been stolen from individuals who are
not customers of the Bank. No existing Bank customers were impacted
by this fraudulent activity and the Bank's core processing system
was not compromised. Upon detection, the Bank immediately closed
all fraudulently-opened credit card accounts and suspended all
credit card activations. The Bank will not open new credit card
accounts until its investigation is complete. The Bank is
implementing enhanced activity monitoring on all existing cards
outstanding.
As a result of the fraudulent activity, the Company recognized a
$4.3 million
fraud-related expense in the first quarter of 2024 and
does not anticipate additional losses related to this event. The
majority of the fraud loss, approximately $3.6 million, or 84%, occurred between
March 25, 2024 and April 2, 2024. In coordination with the Bank's
credit card processor, management is evaluating the root causes of
the fraud event and the preventative and monitoring
controls that would have mitigated the fraud loss.
Management will also consider in this evaluation whether the credit
card product can attain the size and scale needed in the near-term
for the Bank to continue as an issuer. The Bank has notified and is
actively working with law enforcement to recover a portion of the
fraud losses by various means.
The above information was reported on the Company's Current Report
on Form 8-K filed with SEC on April 30,
2024 describing the event. The impact of this event resulted
in a $0.10 decrease to basic and
diluted earnings per share.
- Return on Average Assets ("ROAA") - The Company reported
ROAA of 0.57% for the first quarter of 2024, compared to 0.72% and
0.75% for the fourth and first quarters of 2023, respectively.
Excluding the fraud expense, amortization from core
deposit intangibles, and merger-related expenses the Company's
Non-GAAP, ROAA was 0.94% for the first quarter of 2024, compared to
0.88% and 0.84% for the fourth and first quarters of 2023,
respectively.
- Stable Net Interest Margin - Net interest margin
("NIM") remained relatively stable at 3.08% for the first quarter
of 2024 from 3.09% for the fourth quarter of 2023. Excluding net
accretion interest income of $3.6
million and $3.0 million for
the same time periods, NIM decreased six basis points to 2.81% for
the first quarter of 2024 from 2.87% for the fourth quarter of
2023.
- Active Management of Deposit Costs - Decreases in rates
on higher cost deposit relationships mitigated margin compression
in the first quarter of 2024. For the month of March 2024, asset yields grew more quickly than
funding costs which positively impacted the Company's net interest
margin and may position the Bank to see positive margin movement
during the second quarter of 2024. As a result of decreased rates
paid on some deposits and expected seasonal cash outflows in the
first quarter of 2024, deposits decreased $201.8 million, or 3.7% to $5.2 billion at March 31,
2024 when compared to December 31,
2023. Liquidity remained relatively stable with the loan to
deposit ratio modestly increasing from 86.2% at December 31, 2023 to 89.7% at March 31, 2024. The Bank had no brokered deposits
or advances at March 31, 2024.
- Stable Credit Trends - The Company's total nonperforming
assets to total assets for the first quarter of 2024 was 0.28%
compared to the fourth quarter of 2023 of 0.23%. The Company's
credit quality metrics remain at historical lows with no signs of
significant deterioration or systemic issues within its loan
portfolios.
- Branch Closings and Office Space Rationalization - The
Company expects to close two branches by the end of the third
quarter and to consolidate two office buildings into a single space
by the end of the third quarter.
"While the first quarter's credit card fraud was
disappointing, I am pleased with the response of our team after the
incident was identified to contain the problem, and that no
customers were impacted," stated James ("Jimmy") M. Burke,
President and Chief Executive Officer of Shore Bancshares, Inc. "We
are undertaking a comprehensive review of the incident to recover
as much of the fraudulent charges as possible and are evaluating
our options regarding the future of an in-house credit card
program."
Burke continued, "Active balance sheet management in the first
quarter resulted in stabilizing margins and net interest income
while continued focus on reducing expenses is expected to enhance
future operating leverage. Credit remains stable and we believe we
are well positioned to deliver improving profitability in future
quarters."
Balance Sheet Review
Total assets were $5.8 billion at
March 31, 2024, a decrease of $185
million or 3.1%, when compared to $6.0 billion at December 31, 2023. The
aggregate decrease was primarily due to a decrease in cash and
cash equivalents of $257.9 million
and investment securities held to maturity of $9.4 million partially offset by an increase in
investment securities available for sale of $69.0 million and loans held for investment of
$7.7 million. The ratio of the
Allowance for Credit Losses ("ACL") to total loans decreased
slightly from 1.24% at December 31, 2023, to 1.23% at
March 31, 2024.
The Company's tangible common equity ratio at March 31,
2024 was 7.11% compared to 6.78% at December
31, 2023. The Company's Tier 1 and Total Risk-Based Capital
Ratios at March 31, 2024 were 9.53% and 11.68%, respectively.
The Bank's Tier 1 and Total Risk-Based Capital Ratios at
March 31, 2024 were 10.32% and 11.56%, respectively. Non-owner
occupied commercial real estate ("CRE") loans as a percentage of
the Bank's Tier 1 Capital + ACL at March 31, 2024 and
December 31, 2023 were $2.0 billion or 370.0% and $2.0 billion or 382.6%, respectively.
Construction loans as a percentage of the Bank's Tier 1 Capital +
ACL at March 31, 2024 and December 31, 2023 were
$299.1 million or 54.9% and
$299.0 million or 56.7%,
respectively.
The Bank's office CRE loan portfolio, which includes
owner-occupied and nonowner-occupied CRE loans, was $516.0 million or 11.1% of total loans of
$4.6 billion at March 31,
2024. The Bank's office CRE loan portfolio included $137.7 million or 26.7% of the total with
medical tenants and $73.3 million or 14.2% of the total with
government or government contractor tenants. There were 513 loans
in the office CRE portfolio with an average and median loan size of
$1.0 million and $0.4 million, respectively. Loan to Value
("LTV") estimates are less than 70% for $395.8 million or 76.7% of the office CRE
portfolio and less than 80% for $490.4
million or 95.0% of the office CRE portfolio.
The Bank had 19 office CRE loans totaling $172.0 million that were greater than
$5.0 million at March 31,
2024, compared to 24 office CRE loans totaling $189.8 million at December 31, 2023.
The decrease in this portfolio segment was the result of normal
amortization and a two large loan payoffs in the quarter. For the
office CRE portfolio, at March 31, 2024, the average loan
debt-service coverage ratio was 1.7x and average LTV was 57.6%. Of
the office CRE portfolio balance, 73% is secured by properties in
rural or suburban areas with limited exposure to metropolitan
cities and 92% are secured by properties with five stories or less.
Of the office CRE loans, $5.8 million
will mature and $5.1 million of the
office CRE loans will reprice prior to December 31, 2024. Of the office CRE loans,
$2.2 million are special mention or
substandard.
Total deposits decreased $201.8
million, or 3.7% to $5.2
billion at March 31, 2024 when compared to
December 31, 2023. The decrease in total deposits was
primarily due to a decrease in time deposits of $15.3 million, demand deposits of
$63.6 million, money market and
savings of $65.6 million and
noninterest-bearing deposits of $57.4 million. The decrease in
deposits is primarily attributable to seasonal municipal
runoff and disintermediation of interest-sensitive cannabis-related
deposits.
Total funding, which includes customer deposits, Federal Home
Loan Bank ("FHLB") advances, and brokered deposits decreased
$246.3 million from $5.4 billion at December 31, 2023 to
$5.2 billion at March 31, 2024.
The Bank had no FHLB advances at March 31, 2024 or
December 31, 2023 and reduced brokered deposits from
$44.5 million at December 31,
2023 to zero at March 31, 2024. The Bank's uninsured deposits
at March 31, 2024 were $981.3
million or 18.93% of total deposits. The Bank's uninsured
deposits, excluding deposits secured with pledged collateral, at
March 31, 2024 were $825.9
million or 15.93% of total deposits. At March 31, 2024,
the Bank had approximately $1.2
billion of available liquidity including: $114.6 million in cash, $1.1 billion in secured borrowing capacity at the
FHLB and other correspondent banks, and $45.0 million in unsecured lines of
credit.
Total stockholders' equity increased $4.1
million, or 0.8%, when compared to December 31, 2023,
primarily due to current year earnings, offset by the cash dividend
paid. As of March 31, 2024, the ratio of total equity to total
assets was 8.84% and the ratio of total tangible equity to total
tangible assets was 7.11% compared to 8.50% and 6.78% at
December 31, 2023, respectively.
Management continues to pursue opportunities to increase
efficiencies and decrease expenses as a percentage of operating
revenues. Following feasibility assessments, management decided to
close two branches by the end of the third quarter, subject to
regulatory approval. The Onley, VA
branch should close on or about July 17,
2024 and the Westgate
branch located in Annapolis, MD
should close on or about September 30,
2024. Limited growth opportunities within the Eastern Shore
of Virginia and a conscientious
focus on profitability led to the decision to close the
Onley branch. The Westgate branch has limited foot traffic and
is located less than a mile from another SUB branch within the
City of Annapolis. Customer
disruption is expected to be limited. These closures are estimated
to cost $0.2 million. The
Company is expected to reduce four positions as part of these
closings
Additionally, the Company plans to reduce professional office
space located in Easton, MD. By
the end of the third quarter, a newly renovated office building is
expected to be put into service eliminating the need for two
currently-occupied office buildings. In the second quarter, the
Company expects to begin marketing for sale the two redundant
office properties. Recent appraisals on these properties exceed the
Bank's cost bases resulting in no impairment. At the present time
the two properties remain in service, are not listed for immediate
sale, and are classified as active assets on our balance sheet.
Once these properties meet the accounting criteria they will be
moved to held for sale.
Review of Quarterly Financial Results
Net interest income was $41.1
million for the first quarter of 2024, compared to
$41.5 million for the fourth quarter
of 2023 and $25.7 million for the
first quarter of 2023. The decrease in net interest income when
compared to the fourth quarter of 2023 was primarily due to the
increase in interest expense of $0.4
million resulting from an increase in the average balance of
interest bearing deposits of $70.9
million. The increase when compared to the first quarter of
2023 was primarily due to the increase in interest and fees on
loans, interest on deposits from other banks, a decrease in
interest on short-term borrowings partially offset by the increase
in interest on deposits and interest on long-term borrowings all
significantly impacted by the merger of equals with TCFC in the
third quarter of 2023.
The Company's net interest margin decreased slightly to 3.08%
for the first quarter of 2024 from 3.09% for the fourth quarter of
2023 primarily due to an increase in the overall mix of
interest-bearing deposits compared to noninterest-bearing deposits.
Average interest-bearing deposits increased $70.9 million which resulted in a two basis point
rate increase. In addition to the change in deposit mix, rates on
money market and time deposits also increased, which were partly
offset by lower rates on demand deposits. The Company's net
interest margin decreased to 3.08% for the first quarter of 2024
from 3.18% for the first quarter of 2023. Comparing the first
quarter of 2024 to the first quarter of 2023, the Company's
interest-earning asset yields increased 98 basis points to 5.32%
from 4.34%, while the cost of funds repriced at a faster pace
resulting in an increase of 109 basis points to 2.31% from 1.22%
for the same period.
The provision for credit losses was $0.4
million for the three months ended March 31, 2024. The
comparable amounts were $0.9 million
for the three months ended December 31, 2023, and $1.2 million for the three months ended
March 31, 2023. The decrease in the provision for credit
losses for the first quarter of 2024 compared to the fourth quarter
of 2023 was primarily related to more optimistic short-term
forecasts for unemployment and Gross Domestic Product ("GDP").
Coverage ratios were 1.23% and 1.24% for the three months ended
March 31, 2024 and December 31, 2023, respectively. The
decrease in the provision for credit losses when compared to the
first quarter of 2023 was primarily due to improved economic
factors and forecasts. Net charge-offs for the first quarter of
2024 were $0.6 million compared to
net charge-offs of $0.5 million for
the fourth quarter of 2023 and net charge offs of $20,000 for the first quarter of 2023.
At March 31, 2024 and December 31, 2023, nonperforming
assets were $16.4 million or 0.28% of
total assets and $13.7 million, or
0.23% of total assets, respectively. The balance of nonperforming
assets increased primarily due to an increase in repossessed marine
loans of $1.8 million and an
increase of $0.8 million in loans 90
days past due and still accruing. When comparing March 31,
2024 to March 31, 2023, nonperforming assets increased
$13.7 million, primarily due to
increases in nonaccrual loans of $10.9
million, an increase in repossessed marine loans of
$1.8 million, and an increase of
$0.9 million in loans 90 days past
due and still accruing almost entirely impacted by the merger with
TCFC in the third quarter of 2023.
Total noninterest income for the first quarter of 2024 was
$6.6 million, a decrease of
$1.0 million from $7.5 million for the fourth quarter of 2023 and
an increase $1.2 million from
$5.3 million for the first quarter of
2023. The decrease from the fourth quarter of 2023 was primarily
due to other noninterest income which included decreases in other
fees on bank services and other loan fee income, decreases in
mortgage banking revenue and trust and investment fee income. The
increase from the first quarter of 2023 was primarily due to other
noninterest income which included increases in other loan fee
income, gains on life insurance contracts, an increase in credit
card income, increases in trust and investment fee income and
interchange credits all a result of the merger in the third quarter
of 2023.
Total noninterest expense of $36.7
million for the first quarter of 2024 increased $3.0 million when compared to the fourth quarter
of 2023 expense of $33.7 million and
increased $15.8 million when compared
to the first quarter of 2023 expense of $20.9 million. The increase from the fourth
quarter of 2023 was primarily due to credit card fraud
expense of $4.3 million,
and an increase in employee benefits of $0.7
million partially offset by decreases in salaries and wages
expense of $1.0 million, merger
related expenses of $0.6 million, and
FDIC insurance premium expense of $0.6
million. The increase from the first quarter of 2023 was
primarily due to the operation of a larger branch network due to
the merger with TCFC which significantly impacted almost all
expense line items. Unrelated to the merger were the
fraud expenses in the first quarter of 2024 previously
mentioned above.
Subsequent Event
On May 1, 2024, the Company's
board of directors declared a quarterly common stock dividend in
the amount of $0.12 per share,
payable May 31, 2024 to stockholders
of record on May 16, 2024.
Shore Bancshares Information
Shore Bancshares is a financial holding company headquartered in
Easton, Maryland and is the parent
company of Shore United Bank, N.A. Shore Bancshares engages in
title work related to real estate transactions through its
wholly-owned subsidiary, Mid-Maryland Title Company, Inc. and in
trust and wealth management services through Wye Financial
Partners, a division of Shore United Bank, N.A. Additional
information is available at www.shorebancshares.com.
Forward-Looking Statements
The statements contained herein that are not historical facts
are forward-looking statements (as defined by the Private
Securities Litigation Reform Act of 1995) based on management's
current expectations and beliefs concerning future developments and
their potential effects on the Company. Such statements involve
inherent risks and uncertainties, many of which are difficult to
predict and are generally beyond the control of the Company. There
can be no assurance that future developments affecting the Company
will be the same as those anticipated by management. These
statements are evidenced by terms such as "anticipate," "estimate,"
"should," "expect," "believe," "intend," and similar expressions.
Although these statements reflect management's good faith beliefs
and projections, they are not guarantees of future performance and
they may not prove true. These projections involve risk and
uncertainties that could cause actual results to differ materially
from those addressed in the forward-looking statements. While there
is no assurance that any list of risks and uncertainties or risk
factors is complete, below are certain factors which could cause
actual results to differ materially from those contained or implied
in the forward-looking statements: the effect of acquisitions we
have made or may make, including, without limitation, the failure
to achieve the expected revenue growth and/or expense savings from
such acquisitions, and/or the failure to effectively integrate an
acquisition target into our operations; recent adverse developments
in the banking industry highlighted by high-profile bank failures
and the potential impact of such developments on customer
confidence, liquidity, and regulatory responses to these
developments; changes in general economic, political, or industry
conditions; geopolitical concerns, including the ongoing wars in
Ukraine and the Middle East; uncertainty in U.S. fiscal and
monetary policy, including the interest rate policies of the Board
of Governors of the Federal Reserve System; inflation/deflation,
interest rate, market, and monetary fluctuations; volatility and
disruptions in global capital and credit markets; competitive
pressures on product pricing and services; success, impact, and
timing of our business strategies, including market acceptance of
any new products or services; the impact of changes in financial
services policies, laws, and regulations, including those
concerning taxes, banking, securities, and insurance, and the
application thereof by regulatory bodies; potential changes in
federal policy and at regulatory agencies as a result of the
upcoming 2024 presidential election; a deterioration of the credit
rating for U.S. long-term sovereign debt, actions that the U.S.
government may take to avoid exceeding the debt ceiling, and
uncertainties surrounding debt ceiling and the federal budget; the
impact of recent or future changes in FDIC insurance assessment
rate or the rules and regulations related to the calculation of the
FDIC insurance assessment amount, including any special
assessments; cybersecurity threats and the cost of defending
against them, including the costs of compliance with potential
legislation to combat cybersecurity at a state, national, or global
level; the Company's evaluation of the effect of the credit card
fraud on the Company's internal controls over
financial reporting and its ability to remediate the existing
material weakness identified in its internal control over financial
reporting; the effectiveness of the Company's internal control over
financial reporting and disclosure controls and procedures; climate
change, including any enhanced regulatory, compliance, credit and
reputational risks and costs; and other factors that may affect our
future results. Additional factors that could cause actual results
to differ materially from those expressed in the forward-looking
statements are discussed in the Company's 2023 Annual Report on
Form 10-K filed with the U.S. Securities and Exchange Commission
("SEC") and available at the SEC's Internet site
(http://www.sec.gov).
The Company specifically disclaims any obligation to update any
factors or to publicly announce the result of revisions to any of
the forward-looking statements included herein to reflect future
events or developments.
Shore Bancshares,
Inc.
Financial Highlights
(Unaudited)
|
|
|
|
For the Three Months
Ended March 31,
|
(Dollars in thousands,
except per share data)
|
|
2024
|
|
2023
|
|
Change
|
|
|
|
|
|
|
|
PROFITABILITY FOR THE
PERIOD
|
|
|
|
|
|
|
Net interest
income
|
|
$
41,135
|
|
$
25,664
|
|
60.3 %
|
Provision for credit
losses
|
|
407
|
|
1,213
|
|
(66.4)
|
Noninterest
income
|
|
6,567
|
|
5,334
|
|
23.1
|
Noninterest
expense
|
|
36,698
|
|
20,893
|
|
75.6
|
Income before income
taxes
|
|
10,597
|
|
8,892
|
|
19.2
|
Income tax
expense
|
|
2,413
|
|
2,435
|
|
(0.9)
|
Net income
|
|
$
8,184
|
|
$
6,457
|
|
26.7
|
|
|
|
|
|
|
|
Return on average
assets
|
|
0.57 %
|
|
0.75 %
|
|
(18) bp
|
Return on average
assets excluding amortization of intangibles, merger related
expenses and credit card fraud losses - Non-GAAP (1 )
(2)
|
|
0.94
|
|
0.84
|
|
10
|
Return on average
equity
|
|
6.38
|
|
7.25
|
|
(87)
|
Return on average
tangible equity - Non-GAAP (1), (2)
|
|
13.39
|
|
10.09
|
|
330
|
Interest rate
spread
|
|
2.34
|
|
2.69
|
|
(35)
|
Net interest
margin
|
|
3.08
|
|
3.18
|
|
(10)
|
Efficiency ratio -
GAAP
|
|
76.93
|
|
67.40
|
|
953
|
Efficiency ratio -
Non-GAAP (1)
|
|
62.37
|
|
63.67
|
|
(130)
|
Non-interest income to
avg assets
|
|
0.46
|
|
0.62
|
|
(16)
|
Non-interest expense to
avg assets
|
|
2.56
|
|
2.42
|
|
14
|
Net operating expense
to avg assets
|
|
2.10
|
|
1.80
|
|
30
|
|
|
|
|
|
|
|
PER SHARE
DATA
|
|
|
|
|
|
|
Basic and diluted net
income per common share
|
|
$
0.25
|
|
$
0.32
|
|
(21.9) %
|
|
|
|
|
|
|
|
Dividends paid per
common share
|
|
$
0.12
|
|
$
0.12
|
|
— %
|
Book value per common
share at period end
|
|
15.51
|
|
18.17
|
|
(14.6)
|
Tangible book value per
common share at period end - Non-GAAP (1)
|
|
12.24
|
|
14.74
|
|
(17.0)
|
Market value at period
end
|
|
11.50
|
|
14.28
|
|
(19.5)
|
Market
range:
|
|
|
|
|
|
|
High
|
|
14.38
|
|
18.15
|
|
(20.8)
|
Low
|
|
10.56
|
|
14.00
|
|
(24.6)
|
|
|
|
|
|
|
|
AVERAGE BALANCE SHEET
DATA
|
|
|
|
|
|
|
Loans
|
|
$
4,655,183
|
|
$
2,611,644
|
|
78.2 %
|
Investment
securities
|
|
655,323
|
|
654,193
|
|
0.2
|
Earning
assets
|
|
5,387,782
|
|
3,279,686
|
|
64.3
|
Assets
|
|
5,774,824
|
|
3,506,336
|
|
64.7
|
Deposits
|
|
5,142,658
|
|
2,968,448
|
|
73.2
|
Short-term and Long
Term FHLB advances
|
|
4,000
|
|
113,972
|
|
(96.5)
|
Subordinated Debt &
TRUPS
|
|
72,418
|
|
43,108
|
|
68.0
|
Stockholders'
equity
|
|
515,976
|
|
361,174
|
|
42.9
|
____________________________________
|
(1)
|
See the reconciliation
table that begins on page 21.
|
(2)
|
This ratio excludes
merger related expenses (Non-GAAP) on page 21.
|
Shore Bancshares,
Inc.
Financial Highlights
(Unaudited) - Continued
|
|
|
|
For the Three Months
Ended March 31,
|
(Dollars in thousands,
except per share data)
|
|
2024
|
|
2023
|
|
Change
|
|
|
|
|
|
|
|
CREDIT QUALITY
DATA
|
|
|
|
|
|
|
Net
charge-offs
|
|
$
565
|
|
$
20
|
|
2,725.0 %
|
|
|
|
|
|
|
|
Nonaccrual
loans
|
|
$
12,776
|
|
$
1,894
|
|
574.6 %
|
Loans 90 days past due
and still accruing
|
|
1,560
|
|
611
|
|
155.3
|
Other real estate owned
and Repossessed Property
|
|
2,024
|
|
179
|
|
1,030.7
|
Total nonperforming
assets
|
|
16,360
|
|
2,684
|
|
509.5
|
Borrowers experiencing
financial difficulty ("BEFD") (still accruing)
|
|
—
|
|
—
|
|
—
|
Total nonperforming
assets and BEFD modifications
|
|
$
16,360
|
|
$
2,684
|
|
509.5
|
|
|
|
|
|
|
|
CAPITAL AND CREDIT
QUALITY RATIOS
|
|
|
|
|
|
|
Period-end equity to
assets
|
|
8.84 %
|
|
10.18 %
|
|
(134) bp
|
Period-end tangible
equity to tangible assets - Non-GAAP (1)
|
|
7.11
|
|
8.41
|
|
(130)
|
|
|
|
|
|
|
|
Annualized net
charge-offs to average loans
|
|
0.05 %
|
|
— %
|
|
5 bp
|
|
|
|
|
|
|
|
Allowance for credit
losses as a percent of:
|
|
|
|
|
|
|
Period-end
loans
|
|
1.23 %
|
|
1.07 %
|
|
16 bp
|
Nonaccrual
loans
|
|
448.78
|
|
1,502.85
|
|
(105,407)
|
Nonperforming
assets
|
|
350.46
|
|
1,060.51
|
|
(71,005)
|
Accruing BEFD
modifications
|
|
—
|
|
—
|
|
—
|
Nonperforming assets
and accruing BEFDs
|
|
350.46
|
|
1,060.51
|
|
(71,005)
|
|
|
|
|
|
|
|
As a percent of total
loans:
|
|
|
|
|
|
|
Nonaccrual
loans
|
|
0.27 %
|
|
0.07 %
|
|
20 bp
|
|
|
|
|
|
|
|
As a percent of total
loans, other real estate owned, and repossessed property
|
|
|
|
|
|
|
Nonperforming
assets
|
|
0.35 %
|
|
0.10 %
|
|
25 bp
|
|
|
|
|
|
|
|
As a percent of total
assets:
|
|
|
|
|
|
|
Nonaccrual
loans
|
|
0.22 %
|
|
0.05 %
|
|
17 bp
|
Nonperforming
assets
|
|
0.28 %
|
|
0.08 %
|
|
20
|
____________________________________
|
(1)
|
See the reconciliation
table that begins on page 21.
|
(2)
|
This ratio excludes
merger related expenses (Non-GAAP) on page 21.
|
Shore Bancshares,
Inc.
Consolidated Balance
Sheets (Unaudited)
|
|
|
|
|
|
|
|
|
|
March 31,
2024
|
March 31,
2024
|
|
|
|
|
|
|
|
|
compared to
|
compared to
|
(In thousands, except
per share data)
|
|
March 31,
2024
|
|
December 31,
2023
|
|
March 31,
2023
|
|
December 31,
2023
|
March 31,
2023
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
Cash and due from
banks
|
|
$
43,079
|
|
$
63,172
|
|
$
23,863
|
|
(31.8) %
|
80.5 %
|
Interest-bearing
deposits with other banks
|
|
71,481
|
|
309,241
|
|
13,846
|
|
(76.9)
|
416.3
|
Cash and cash
equivalents
|
|
114,560
|
|
372,413
|
|
37,709
|
|
(69.2)
|
203.8
|
|
|
|
|
|
|
|
|
|
|
Investment securities
available for sale (at fair value)
|
|
179,496
|
|
110,521
|
|
81,525
|
|
62.4
|
120.2
|
Investment securities
held to maturity (net of allowance for
credit losses of $116
(March 31, 2024), $94 (December 31, 2023), $0 (March 31,
2023)) at amortized cost)
|
|
503,822
|
|
513,188
|
|
549,096
|
|
(1.8)
|
(8.2)
|
Equity securities, at
fair value
|
|
5,681
|
|
5,703
|
|
1,258
|
|
(0.4)
|
351.6
|
Restricted
securities
|
|
17,863
|
|
17,900
|
|
15,067
|
|
(0.2)
|
18.6
|
Loans held for sale, at
fair value
|
|
13,767
|
|
8,782
|
|
3,514
|
|
56.8
|
291.8
|
|
|
|
|
|
|
|
|
|
|
Loans held for
investment
|
|
4,648,725
|
|
4,641,010
|
|
2,668,681
|
|
0.2
|
74.2
|
Less: allowance for
credit losses
|
|
(57,336)
|
|
(57,351)
|
|
(28,464)
|
|
—
|
(101.4)
|
Loans, net
|
|
4,591,389
|
|
4,583,659
|
|
2,640,217
|
|
0.2
|
73.9
|
Premises and equipment,
net
|
|
83,084
|
|
82,386
|
|
50,516
|
|
0.8
|
64.5
|
Goodwill
|
|
63,266
|
|
63,266
|
|
63,266
|
|
—
|
—
|
Other intangible
assets, net
|
|
45,515
|
|
48,090
|
|
5,106
|
|
(5.4)
|
791.4
|
Other real estate
owned, net
|
|
179
|
|
179
|
|
179
|
|
—
|
—
|
Repossessed property,
net
|
|
1,845
|
|
—
|
|
—
|
|
—
|
—
|
Mortgage servicing
rights, at fair value
|
|
5,821
|
|
5,926
|
|
5,310
|
|
(1.8)
|
9.6
|
Right of use assets,
net
|
|
12,153
|
|
12,487
|
|
9,344
|
|
(2.7)
|
30.1
|
Cash surrender value on
life insurance
|
|
102,321
|
|
101,704
|
|
59,711
|
|
0.6
|
71.4
|
Accrued interest
receivable
|
|
19,541
|
|
19,217
|
|
8,218
|
|
1.7
|
137.8
|
Deferred income
taxes
|
|
38,978
|
|
40,707
|
|
10,436
|
|
(4.2)
|
273.5
|
Other assets
|
|
26,423
|
|
24,790
|
|
13,222
|
|
6.6
|
99.8
|
Total assets
|
|
$
5,825,704
|
|
$
6,010,918
|
|
$
3,553,694
|
|
(3.1)
|
63.9
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
deposits
|
|
$
1,200,680
|
|
$
1,258,037
|
|
$
808,679
|
|
(4.6) %
|
48.5 %
|
Interest-bearing
deposits
|
|
3,983,599
|
|
4,128,083
|
|
2,185,883
|
|
(3.5)
|
82.2
|
Total
deposits
|
|
5,184,279
|
|
5,386,120
|
|
2,994,562
|
|
(3.7)
|
73.1
|
|
|
|
|
|
|
|
|
|
|
Advances from FHLB -
short-term
|
|
—
|
|
—
|
|
131,500
|
|
—
|
(100.0)
|
Guaranteed preferred
beneficial interest in junior subordinated
debentures ("TRUPS")
|
|
29,237
|
|
29,158
|
|
18,445
|
|
0.3
|
58.5
|
Subordinated
debt
|
|
43,322
|
|
43,139
|
|
24,705
|
|
0.4
|
75.4
|
Total
borrowings
|
|
72,559
|
|
72,297
|
|
174,650
|
|
0.4
|
(58.5)
|
|
|
|
|
|
|
|
|
|
|
Lease
liabilities
|
|
12,552
|
|
12,857
|
|
9,642
|
|
(2.4)
|
30.2
|
Accrued expenses and
other liabilities
|
|
41,086
|
|
28,509
|
|
13,202
|
|
44.1
|
211.2
|
Total
liabilities
|
|
$
5,310,476
|
|
$
5,499,783
|
|
$
3,192,056
|
|
(3.4)
|
66.4
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
|
Common stock, par value
$0.01; authorized 50,000,000 shares
|
|
$
332
|
|
$
332
|
|
$
199
|
|
—
|
66.8
|
Additional paid in
capital
|
|
356,464
|
|
356,007
|
|
201,736
|
|
0.1
|
76.7
|
Retained
earnings
|
|
166,490
|
|
162,290
|
|
167,864
|
|
2.6
|
(0.8)
|
Accumulated other
comprehensive loss
|
|
(8,058)
|
|
(7,494)
|
|
(8,161)
|
|
(7.5)
|
1.3
|
Total stockholders'
equity
|
|
515,228
|
|
511,135
|
|
361,638
|
|
0.8
|
42.5
|
Total liabilities and
stockholders' equity
|
|
$
5,825,704
|
|
$
6,010,918
|
|
$
3,553,694
|
|
(3.1)
|
63.9
|
|
|
|
|
|
|
|
|
|
|
Period-end common
shares outstanding
|
|
$
33,211
|
|
$
33,162
|
|
$
19,898
|
|
0.1
|
66.9
|
Book value per common
share
|
|
$
15.51
|
|
$
15.41
|
|
$
18.17
|
|
0.6
|
(14.6)
|
Shore Bancshares,
Inc.
Consolidated Statements
of Income (Unaudited)
|
|
|
|
For the Three Months
Ended March 31,
|
(In thousands, except
per share data)
|
|
2024
|
|
2023
|
|
% Change
|
|
|
|
|
|
|
|
INTEREST
INCOME
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
$
65,754
|
|
$
30,828
|
|
113.3 %
|
Interest on investment
securities:
|
|
|
|
|
|
|
Taxable
|
|
4,419
|
|
4,064
|
|
8.7
|
Tax-exempt
|
|
6
|
|
7
|
|
(14.3)
|
Interest on deposits
with other banks
|
|
960
|
|
163
|
|
489.0
|
Total interest
income
|
|
$
71,139
|
|
$
35,062
|
|
102.9
|
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
|
Interest on
deposits
|
|
$
28,497
|
|
$
7,281
|
|
291.4
|
Interest on short-term
borrowings
|
|
56
|
|
1,361
|
|
(95.9)
|
Interest on long-term
borrowings
|
|
1,451
|
|
756
|
|
91.9
|
Total interest
expense
|
|
$
30,004
|
|
$
9,398
|
|
219.3
|
|
|
|
|
|
|
|
NET INTEREST
INCOME
|
|
$
41,135
|
|
$
25,664
|
|
60.3
|
Provision for credit
losses
|
|
407
|
|
1,213
|
|
(66.4)
|
|
|
|
|
|
|
|
NET INTEREST INCOME
AFTER PROVISION FOR CREDIT LOSSES
|
|
$
40,728
|
|
$
24,451
|
|
66.6
|
|
|
|
|
|
|
|
NONINTEREST
INCOME
|
|
|
|
|
|
|
Service charges on
deposit accounts
|
|
$
1,507
|
|
$
1,213
|
|
24.2
|
Trust and investment
fee income
|
|
734
|
|
432
|
|
69.9
|
Interchange
credits
|
|
1,587
|
|
1,212
|
|
30.9
|
Mortgage-banking
revenue
|
|
801
|
|
977
|
|
(18.0)
|
Title Company
revenue
|
|
78
|
|
137
|
|
(43.1)
|
Other noninterest
income
|
|
1,860
|
|
1,363
|
|
36.5
|
Total noninterest
income
|
|
$
6,567
|
|
$
5,334
|
|
23.1
|
Shore Bancshares,
Inc.
Consolidated Statements
of Income (Unaudited) - Continued
|
|
|
|
For the Three Months
Ended March 31,
|
(In thousands, except
per share data)
|
|
2024
|
|
2023
|
|
% Change
|
|
|
|
|
|
|
|
NONINTEREST
EXPENSE
|
|
|
|
|
|
|
Salaries and
wages
|
|
$
11,852
|
|
$
8,684
|
|
36.5 %
|
Employee
benefits
|
|
4,097
|
|
2,921
|
|
40.3
|
Occupancy
expense
|
|
2,416
|
|
1,619
|
|
49.2
|
Furniture and equipment
expense
|
|
904
|
|
534
|
|
69.3
|
Data
processing
|
|
2,867
|
|
1,798
|
|
59.5
|
Directors'
fees
|
|
295
|
|
250
|
|
18.0
|
Amortization of
intangible assets
|
|
2,576
|
|
441
|
|
484.1
|
FDIC insurance premium
expense
|
|
1,150
|
|
371
|
|
210.0
|
Other real estate
owned, net
|
|
—
|
|
(1)
|
|
100.0
|
Legal and professional
fees
|
|
1,599
|
|
750
|
|
113.2
|
Fraud losses
(1)
|
|
4,502
|
|
67
|
|
6,619.4
|
Merger related
expenses
|
|
—
|
|
691
|
|
(100.0)
|
Other noninterest
expenses
|
|
4,440
|
|
2,768
|
|
60.4
|
Total noninterest
expense
|
|
$
36,698
|
|
$
20,893
|
|
75.6
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
$
10,597
|
|
$
8,892
|
|
19.2
|
Income tax
expense
|
|
2,413
|
|
2,435
|
|
(0.9)
|
NET INCOME
|
|
$
8,184
|
|
$
6,457
|
|
26.7
|
|
|
|
|
|
|
|
Weighted average shares
outstanding - basic and diluted
|
|
33,337
|
|
19,886
|
|
67.6
|
|
|
|
|
|
|
|
Basic and diluted net
income per common share
|
|
$
0.25
|
|
$
0.32
|
|
(21.9)
|
|
|
|
|
|
|
|
Dividends paid per
common share
|
|
$
0.12
|
|
$
0.12
|
|
—
|
____________________________________
|
(1)
|
Fraud losses includes
$4.3 million of credit card fraud losses for the quarter ended
March 31, 2024.
|
Shore Bancshares, Inc.
Consolidated Average
Balance Sheets (Unaudited)
|
|
|
|
For the Three Months
Ended
|
|
For the Three Months
Ended
|
|
|
March 31,
2024
|
|
March 31,
2023
|
|
March 31,
2024
|
|
December 31,
2023
|
(Dollars in
thousands)
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earning
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans (1), (2),
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer real
estate
|
|
$
1,361,636
|
|
$
18,492
|
|
5.46 %
|
|
$
881,799
|
|
$
10,507
|
|
4.83 %
|
|
$
1,361,636
|
|
$
18,492
|
|
5.46 %
|
|
$
1,331,150
|
|
$
18,653
|
|
5.56 %
|
Commercial real
estate
|
|
2,722,600
|
|
38,604
|
|
5.70
|
|
1,279,923
|
|
15,173
|
|
4.81
|
|
2,722,600
|
|
38,604
|
|
5.70
|
|
2,728,094
|
|
38,730
|
|
5.63
|
Commercial
|
|
219,884
|
|
4,097
|
|
7.49
|
|
142,797
|
|
1,819
|
|
5.17
|
|
219,884
|
|
4,097
|
|
7.49
|
|
221,342
|
|
4,295
|
|
7.70
|
Consumer
|
|
329,118
|
|
4,272
|
|
5.22
|
|
297,528
|
|
3,274
|
|
4.46
|
|
329,118
|
|
4,272
|
|
5.22
|
|
333,807
|
|
3,859
|
|
4.59
|
State and
political
|
|
1,473
|
|
16
|
|
4.37
|
|
978
|
|
9
|
|
3.73
|
|
1,473
|
|
16
|
|
4.37
|
|
1,290
|
|
13
|
|
4.00
|
Credit Cards
|
|
7,457
|
|
167
|
|
9.01
|
|
—
|
|
—
|
|
—
|
|
7,457
|
|
167
|
|
9.01
|
|
6,320
|
|
166
|
|
10.42
|
Other
|
|
13,015
|
|
183
|
|
5.66
|
|
8,619
|
|
84
|
|
3.91
|
|
13,015
|
|
183
|
|
5.66
|
|
17,464
|
|
277
|
|
6.29
|
Total Loans
|
|
4,655,183
|
|
65,831
|
|
5.69
|
|
2,611,644
|
|
30,866
|
|
4.79
|
|
4,655,183
|
|
65,831
|
|
5.69
|
|
4,639,467
|
|
65,993
|
|
5.64
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment
securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
|
|
654,663
|
|
4,419
|
|
2.70
|
|
653,527
|
|
4,064
|
|
2.49
|
|
654,663
|
|
4,419
|
|
2.70
|
|
619,259
|
|
3,992
|
|
2.58
|
Tax-exempt
(1)
|
|
660
|
|
8
|
|
4.85
|
|
666
|
|
9
|
|
5.41
|
|
660
|
|
8
|
|
4.85
|
|
661
|
|
8
|
|
4.84
|
Interest-bearing
deposits
|
|
77,276
|
|
960
|
|
5.00
|
|
13,849
|
|
163
|
|
4.77
|
|
77,276
|
|
960
|
|
5.00
|
|
80,446
|
|
1,224
|
|
6.04
|
Total earning
assets
|
|
5,387,782
|
|
71,218
|
|
5.32
|
|
3,279,686
|
|
35,102
|
|
4.34
|
|
5,387,782
|
|
71,218
|
|
5.32
|
|
5,339,833
|
|
71,217
|
|
5.29
|
Cash and due from
banks
|
|
49,499
|
|
|
|
|
|
28,602
|
|
|
|
|
|
49,499
|
|
|
|
|
|
63,506
|
|
|
|
|
Other assets
|
|
395,023
|
|
|
|
|
|
228,054
|
|
|
|
|
|
395,023
|
|
|
|
|
|
399,409
|
|
|
|
|
Allowance for credit
losses
|
|
(57,480)
|
|
|
|
|
|
(30,006)
|
|
|
|
|
|
(57,480)
|
|
|
|
|
|
(57,308)
|
|
|
|
|
Total
assets
|
|
$
5,774,824
|
|
|
|
|
|
$
3,506,336
|
|
|
|
|
|
$
5,774,824
|
|
|
|
|
|
$
5,745,440
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits
|
|
$
1,110,524
|
|
$
6,362
|
|
2.30 %
|
|
$
694,894
|
|
$
3,236
|
|
1.89 %
|
|
$
1,110,524
|
|
$
6,362
|
|
2.30 %
|
|
$
1,117,117
|
|
$
6,673
|
|
2.37 %
|
Money market and
savings deposits
|
|
1,669,074
|
|
10,160
|
|
2.45
|
|
1,004,553
|
|
2,374
|
|
0.96
|
|
1,669,074
|
|
10,160
|
|
2.45
|
|
1,605,930
|
|
8,330
|
|
2.06
|
Brokered
deposits
|
|
20,465
|
|
251
|
|
4.93
|
|
—
|
|
—
|
|
—
|
|
20,465
|
|
251
|
|
4.93
|
|
92,840
|
|
1,347
|
|
5.76
|
Certificates of deposit
$100,000 or more
|
|
762,210
|
|
7,675
|
|
4.05
|
|
241,436
|
|
1,076
|
|
1.81
|
|
762,210
|
|
7,675
|
|
4.05
|
|
701,051
|
|
6,898
|
|
3.90
|
Other time
deposits
|
|
417,362
|
|
4,049
|
|
3.90
|
|
207,403
|
|
595
|
|
1.16
|
|
417,362
|
|
4,049
|
|
3.90
|
|
391,820
|
|
4,885
|
|
4.95
|
Interest-bearing
deposits (4)
|
|
3,979,635
|
|
28,497
|
|
2.88
|
|
2,148,286
|
|
7,281
|
|
1.37
|
|
3,979,635
|
|
28,497
|
|
2.88
|
|
3,908,758
|
|
28,133
|
|
2.86
|
Advances from FHLB -
short-term
|
|
4,000
|
|
56
|
|
5.63
|
|
113,972
|
|
1,361
|
|
4.84
|
|
4,000
|
|
56
|
|
5.63
|
|
1,141
|
|
16
|
|
5.56
|
Subordinated debt and
Guaranteed preferred
beneficial interest in junior subordinated
debentures ("TRUPS") (4)
|
|
72,418
|
|
1,451
|
|
8.06
|
|
43,108
|
|
756
|
|
7.11
|
|
72,418
|
|
1,451
|
|
8.06
|
|
72,155
|
|
1,462
|
|
8.04
|
Total
interest-bearing liabilities
|
|
4,056,053
|
|
30,004
|
|
2.98
|
|
2,305,366
|
|
9,398
|
|
1.65
|
|
4,056,053
|
|
30,004
|
|
2.98
|
|
3,982,054
|
|
29,611
|
|
2.95
|
Noninterest-bearing
deposits
|
|
1,163,023
|
|
|
|
|
|
820,162
|
|
|
|
|
|
1,163,023
|
|
|
|
|
|
1,228,060
|
|
|
|
|
Accrued expenses and
other liabilities
|
|
39,772
|
|
|
|
|
|
19,634
|
|
|
|
|
|
39,772
|
|
|
|
|
|
28,286
|
|
|
|
|
Stockholders'
equity
|
|
515,976
|
|
|
|
|
|
361,174
|
|
|
|
|
|
515,976
|
|
|
|
|
|
507,040
|
|
|
|
|
Total liabilities
and stockholders' equity
|
|
$
5,774,824
|
|
|
|
|
|
$
3,506,336
|
|
|
|
|
|
$
5,774,824
|
|
|
|
|
|
$
5,745,440
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
$
41,214
|
|
|
|
|
|
$
25,704
|
|
|
|
|
|
$
41,214
|
|
|
|
|
|
$
41,606
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
spread
|
|
|
|
|
|
2.34 %
|
|
|
|
|
|
2.69 %
|
|
|
|
|
|
2.34 %
|
|
|
|
|
|
2.34 %
|
Net interest
margin
|
|
|
|
|
|
3.08 %
|
|
|
|
|
|
3.18 %
|
|
|
|
|
|
3.08 %
|
|
|
|
|
|
3.09 %
|
Cost of
Funds
|
|
|
|
|
|
2.31 %
|
|
|
|
|
|
1.22 %
|
|
|
|
|
|
2.31 %
|
|
|
|
|
|
2.25 %
|
Cost of
Deposits
|
|
|
|
|
|
2.23 %
|
|
|
|
|
|
0.99 %
|
|
|
|
|
|
2.23 %
|
|
|
|
|
|
2.17 %
|
Cost of Debt
|
|
|
|
|
|
7.93 %
|
|
|
|
|
|
5.47 %
|
|
|
|
|
|
7.93 %
|
|
|
|
|
|
8.00 %
|
____________________________________
|
(1)
|
All amounts are
reported on a tax-equivalent basis computed using the statutory
federal income tax rate of 21.0%, exclusive of nondeductible
interest expense.
|
(2)
|
Average loan balances
include nonaccrual loans.
|
(3)
|
Interest income on
loans includes accreted loan fees, net of costs and accretion of
discounts on acquired loans, which are included in the yield
calculations. There were $4.2 million, $0.5 million and $4.8
million of accretion interest on loans for the three months ended
March 31, 2024 and 2023, and December 31, 2023,
respectively.
|
(4)
|
Interest expense on
deposits and borrowing includes amortization of deposit discount
and amortization of borrowing fair value adjustments. There were
$(0.4) million, $0.1 million and $(1.5) million of amortization of
deposits premium, and $(0.2) million, $(47,000), and $(0.2) million
of amortization of borrowing fair value adjustments for the three
months ended March 31, 2024 and 2023, and December 31,
2023, respectively.
|
Shore Bancshares,
Inc.
Financial Highlights By
Quarter (Unaudited)
|
|
|
|
1st
Quarter
|
|
4th Quarter
|
|
3rd Quarter
|
|
2nd Quarter
|
|
1st Quarter
|
|
3/31/2024
|
|
3/31/2024
|
|
|
2024
|
|
2023
|
|
2023
|
|
2023
|
|
2023
|
|
compared to
|
|
compared to
|
(Dollars in thousands,
except per share data)
|
|
Q1
2024
|
|
Q4 2023
|
|
Q3 2023
|
|
Q2 2023
|
|
Q1 2023
|
|
Q4 2023
|
|
Q1 2023
|
PROFITABILITY FOR THE
PERIOD
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable-equivalent net
interest income
|
|
$
41,214
|
|
$
41,606
|
|
$
45,702
|
|
$
22,545
|
|
$
25,704
|
|
(0.9) %
|
|
60.3 %
|
Less:
Taxable-equivalent adjustment
|
|
79
|
|
81
|
|
80
|
|
51
|
|
40
|
|
(2.5)
|
|
97.5
|
Net interest
income
|
|
41,135
|
|
41,525
|
|
45,622
|
|
22,494
|
|
25,664
|
|
(0.9)
|
|
60.3
|
Provision for credit
losses
|
|
407
|
|
896
|
|
28,176
|
|
667
|
|
1,213
|
|
(54.6)
|
|
(66.5)
|
Noninterest
income
|
|
6,567
|
|
7,548
|
|
14,984
|
|
5,294
|
|
5,334
|
|
(13.0)
|
|
23.1
|
Noninterest
expense
|
|
36,698
|
|
33,670
|
|
47,158
|
|
21,608
|
|
20,893
|
|
9.0
|
|
75.6
|
Income/(loss) before
income taxes
|
|
10,597
|
|
14,507
|
|
(14,728)
|
|
5,513
|
|
8,892
|
|
(27.0)
|
|
19.2
|
Income tax expense/
(benefit)
|
|
2,413
|
|
4,017
|
|
(4,991)
|
|
1,495
|
|
2,435
|
|
(39.9)
|
|
(0.9)
|
Net income/
(loss)
|
|
$
8,184
|
|
$
10,490
|
|
$
(9,737)
|
|
$
4,018
|
|
$
6,457
|
|
(22.0)
|
|
26.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
|
0.57 %
|
|
0.72 %
|
|
(0.67) %
|
|
0.45 %
|
|
0.75 %
|
|
(15) bp
|
|
(18) bp
|
Return on average
assets excluding amortization of
intangibles, fraud losses and merger related expenses -
Non-GAAP (1), (2)
|
|
0.94
|
|
0.88
|
|
0.01
|
|
0.59
|
|
0.84
|
|
6
|
|
10
|
Return on average
equity
|
|
6.38
|
|
8.21
|
|
(7.25)
|
|
4.49
|
|
7.25
|
|
(183)
|
|
(87)
|
Return on average
tangible equity - Non-GAAP (1), (2)
|
|
13.39
|
|
12.88
|
|
1.74
|
|
7.16
|
|
10.09
|
|
51
|
|
330
|
Net interest
margin
|
|
3.08
|
|
3.09
|
|
3.35
|
|
2.68
|
|
3.18
|
|
(1)
|
|
(10)
|
Efficiency ratio -
GAAP
|
|
76.93
|
|
68.61
|
|
77.81
|
|
77.76
|
|
67.40
|
|
832
|
|
953
|
Efficiency ratio -
Non-GAAP (1)
|
|
62.37
|
|
61.99
|
|
47.19
|
|
71.75
|
|
63.67
|
|
38
|
|
(130)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PER SHARE
DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net
income/(loss) per common share
|
|
$
0.25
|
|
$
0.32
|
|
$
(0.29)
|
|
$
0.20
|
|
$
0.32
|
|
(21.9) %
|
|
(21.9) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends paid per
common share
|
|
0.12
|
|
0.12
|
|
0.12
|
|
0.12
|
|
0.12
|
|
—
|
|
—
|
Book value per common
share at period end
|
|
15.51
|
|
15.41
|
|
15.14
|
|
18.24
|
|
18.17
|
|
0.6
|
|
(14.6)
|
Tangible book value per
common share at period end -
Non-GAAP (1)
|
|
12.24
|
|
12.06
|
|
11.70
|
|
14.83
|
|
14.74
|
|
1.5
|
|
(17.0)
|
Market value at period
end
|
|
11.50
|
|
14.25
|
|
10.52
|
|
11.56
|
|
14.28
|
|
(19.3)
|
|
(19.5)
|
Market
range:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
High
|
|
14.38
|
|
14.51
|
|
13.37
|
|
14.45
|
|
18.15
|
|
(0.9)
|
|
(20.8)
|
Low
|
|
10.56
|
|
9.66
|
|
10.27
|
|
10.65
|
|
14.00
|
|
9.3
|
|
(24.6)
|
____________________________________
|
(1)
|
See the reconciliation
table (Non-GAAP) that begins on page 21.
|
(2)
|
This ratio excludes
merger related expenses (Non-GAAP) on page 21.
|
Shore Bancshares,
Inc.
Financial Highlights By
Quarter (Unaudited) - Continued
|
|
|
|
1st
Quarter
|
|
4th Quarter
|
|
3rd Quarter
|
|
2nd Quarter
|
|
1st Quarter
|
|
3/31/2024
|
|
3/31/2024
|
|
|
2024
|
|
2023
|
|
2023
|
|
2023
|
|
2023
|
|
compared to
|
|
compared to
|
(Dollars in thousands,
except per share data)
|
|
Q1
2024
|
|
Q4 2023
|
|
Q3 2023
|
|
Q2 2023
|
|
Q1 2023
|
|
Q4 2023
|
|
Q1 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE BALANCE SHEET
DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
|
|
$ 4,655,183
|
|
$ 4,639,467
|
|
$ 4,562,748
|
|
$ 2,709,944
|
|
$ 2,611,644
|
|
0.34 %
|
|
78.25 %
|
Investment
securities
|
|
655,323
|
|
619,920
|
|
778,744
|
|
645,842
|
|
654,193
|
|
5.71
|
|
0.17
|
Earning
assets
|
|
5,387,782
|
|
5,339,833
|
|
5,404,572
|
|
3,369,183
|
|
3,279,686
|
|
0.90
|
|
64.28
|
Assets
|
|
5,774,824
|
|
5,745,440
|
|
5,769,312
|
|
3,596,311
|
|
3,506,336
|
|
0.51
|
|
64.70
|
Deposits
|
|
5,142,658
|
|
5,136,818
|
|
5,066,886
|
|
2,908,662
|
|
2,968,448
|
|
0.11
|
|
73.24
|
Short-term and Long
Term FHLB advances
|
|
4,000
|
|
1,141
|
|
70,348
|
|
261,797
|
|
113,972
|
|
250.57
|
|
(96.49)
|
Subordinated Debt &
TRUPS
|
|
72,418
|
|
72,155
|
|
71,907
|
|
43,185
|
|
43,108
|
|
0.36
|
|
67.99
|
Stockholders'
equity
|
|
515,976
|
|
507,040
|
|
533,114
|
|
363,225
|
|
361,174
|
|
1.76
|
|
42.86
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CREDIT QUALITY
DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge
offs
|
|
$
565
|
|
$
500
|
|
$
1,449
|
|
$
50
|
|
$
20
|
|
13.00 %
|
|
2,725.00 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual
loans
|
|
$
12,776
|
|
$
12,784
|
|
$
8,982
|
|
$
3,481
|
|
$
1,894
|
|
(0.06) %
|
|
574.55 %
|
Loans 90 days past due
and still accruing
|
|
1,560
|
|
738
|
|
2,149
|
|
1,065
|
|
611
|
|
111.38
|
|
155.32
|
Other real estate owned
and repossessed property
|
|
2,024
|
|
179
|
|
179
|
|
179
|
|
179
|
|
1,030.73
|
|
1,030.73
|
Total nonperforming
assets
|
|
$
16,360
|
|
$
13,701
|
|
$
11,310
|
|
$
4,725
|
|
$
2,684
|
|
19.41
|
|
509.54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shore Bancshares,
Inc.
Financial Highlights By
Quarter (Unaudited) - Continued
|
|
|
|
1st
Quarter
|
|
4th Quarter
|
|
3rd Quarter
|
|
2nd Quarter
|
|
1st Quarter
|
|
3/31/2024
|
|
3/31/2024
|
|
|
2024
|
|
2023
|
|
2023
|
|
2023
|
|
2023
|
|
compared to
|
|
compared to
|
(Dollars in thousands,
except per share data)
|
|
Q1
2024
|
|
Q4 2023
|
|
Q3 2023
|
|
Q2 2023
|
|
Q1 2023
|
|
Q4 2023
|
|
Q1 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL AND CREDIT
QUALITY RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period-end equity to
assets
|
|
8.84 %
|
|
8.50 %
|
|
8.79 %
|
|
9.97 %
|
|
10.18 %
|
|
34 bp
|
|
(134) bp
|
Period-end tangible
equity to tangible assets - Non-GAAP (1)
|
|
7.11
|
|
6.78
|
|
6.93
|
|
8.26
|
|
8.41
|
|
33
|
|
(130)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annualized net
charge-offs to average loans
|
|
0.05 %
|
|
0.04 %
|
|
0.13 %
|
|
0.01 %
|
|
— %
|
|
1 bp
|
|
5 bp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for credit
losses as a percent of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period-end loans
(3)
|
|
1.23 %
|
|
1.24 %
|
|
1.24 %
|
|
1.05 %
|
|
1.07 %
|
|
(1) bp
|
|
16 bp
|
Period-end loans
(4)
|
|
1.23
|
|
1.24
|
|
1.24
|
|
1.05
|
|
1.07
|
|
(1)
|
|
16
|
Nonaccrual
loans
|
|
448.78
|
|
448.62
|
|
635.17
|
|
833.50
|
|
1502.85
|
|
16
|
|
(105,407)
|
Nonperforming
assets
|
|
350.46
|
|
418.59
|
|
504.43
|
|
614.05
|
|
1060.51
|
|
(6,813)
|
|
(71,005)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As a percent of total
loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual
loans
|
|
0.27 %
|
|
0.28 %
|
|
0.19 %
|
|
0.13 %
|
|
0.07 %
|
|
(1) bp
|
|
20 bp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As a percent of total
loans, other real estate owned, and
repossessed property
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming
assets
|
|
0.35 %
|
|
0.30 %
|
|
0.24 %
|
|
0.17 %
|
|
0.10 %
|
|
5 bp
|
|
25 bp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As a percent of total
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual
loans
|
|
0.22 %
|
|
0.21 %
|
|
0.16 %
|
|
0.10 %
|
|
0.05 %
|
|
1 bp
|
|
17 bp
|
Nonperforming
assets
|
|
0.28
|
|
0.23
|
|
0.20
|
|
0.13
|
|
0.08
|
|
5
|
|
20
|
____________________________________
|
(1)
|
See the reconciliation
table (Non-GAAP) that begins on page 21.
|
(2)
|
This ratio excludes
merger related expenses (Non-GAAP) on page 21.
|
(3)
|
Includes all loans held
for investment, including PPP loan balances for all periods
shown.
|
(4)
|
For 2023, this ratio
excludes only PPP loans given the Company's adoption of the CECL
standard.
|
Shore Bancshares,
Inc.
Consolidated Balance
Sheets (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
2024
|
|
March 31,
2024
|
|
|
|
|
|
|
|
|
|
|
|
|
compared to
|
|
compared to
|
(In thousands, except
per share data)
|
|
March 31,
2024
|
|
December 31,
2023
|
|
September 30,
2023
|
|
June 30,
2023
|
|
March 31,
2023
|
|
December 31,
2023
|
|
March 31,
2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from
banks
|
|
$
43,079
|
|
$
63,172
|
|
$
68,097
|
|
$
35,423
|
|
$
23,863
|
|
(31.8) %
|
|
80.5 %
|
Interest-bearing
deposits with other banks
|
|
71,481
|
|
309,241
|
|
40,612
|
|
10,404
|
|
13,846
|
|
(76.9)
|
|
416.3
|
Cash and cash
equivalents
|
|
114,560
|
|
372,413
|
|
108,709
|
|
45,827
|
|
37,709
|
|
(69.2)
|
|
203.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment securities
available for sale (at fair value)
|
|
179,496
|
|
110,521
|
|
79,143
|
|
78,069
|
|
81,525
|
|
62.4
|
|
120.2
|
Investment securities
held to maturity (net of allowance for
credit losses of $116 (March 31, 2024), $94 (December 31,
2023), $126 ( September 30, 2023), $163 (June 30, 2023)
and $0 (March 31, 2023)) at amortized cost)
|
|
503,822
|
|
513,188
|
|
523,051
|
|
536,970
|
|
549,096
|
|
(1.8)
|
|
(8.2)
|
Equity securities, at
fair value
|
|
5,681
|
|
5,703
|
|
5,434
|
|
1,245
|
|
1,258
|
|
(0.4)
|
|
351.6
|
Restricted
securities
|
|
17,863
|
|
17,900
|
|
13,361
|
|
21,208
|
|
15,067
|
|
(0.2)
|
|
18.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans held for sale, at
fair value
|
|
13,767
|
|
8,782
|
|
14,725
|
|
6,845
|
|
3,514
|
|
56.8
|
|
291.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans held for
investment
|
|
4,648,725
|
|
4,641,010
|
|
4,617,719
|
|
2,753,223
|
|
2,668,681
|
|
0.2
|
|
74.2
|
Less: allowance for
credit losses
|
|
(57,336)
|
|
(57,351)
|
|
(57,051)
|
|
(29,014)
|
|
(28,464)
|
|
—
|
|
(101.4)
|
Loans, net
|
|
4,591,389
|
|
4,583,659
|
|
4,560,668
|
|
2,724,209
|
|
2,640,217
|
|
0.2
|
|
73.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Premises and equipment,
net
|
|
83,084
|
|
82,386
|
|
81,149
|
|
51,036
|
|
50,516
|
|
0.8
|
|
64.5
|
Goodwill
|
|
63,266
|
|
63,266
|
|
63,266
|
|
63,266
|
|
63,266
|
|
—
|
|
—
|
Other intangible
assets, net
|
|
45,515
|
|
48,090
|
|
50,685
|
|
4,671
|
|
5,106
|
|
(5.4)
|
|
791.4
|
Other real estate
owned, net
|
|
179
|
|
179
|
|
179
|
|
179
|
|
179
|
|
—
|
|
—
|
Repossessed property,
net
|
|
1,845
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Mortgage servicing
rights, at fair value
|
|
5,821
|
|
5,926
|
|
5,890
|
|
5,466
|
|
5,310
|
|
(1.8)
|
|
9.6
|
Right of use assets,
net
|
|
12,153
|
|
12,487
|
|
12,741
|
|
9,077
|
|
9,344
|
|
(2.7)
|
|
30.1
|
Cash surrender value on
life insurance
|
|
102,321
|
|
101,704
|
|
100,950
|
|
60,150
|
|
59,711
|
|
0.6
|
|
71.4
|
Accrued interest
receivable
|
|
19,541
|
|
19,217
|
|
15,683
|
|
8,778
|
|
8,218
|
|
1.7
|
|
137.8
|
Deferred income
taxes
|
|
38,978
|
|
40,707
|
|
45,346
|
|
10,879
|
|
10,436
|
|
(4.2)
|
|
273.5
|
Other assets
|
|
26,423
|
|
24,790
|
|
24,392
|
|
13,756
|
|
13,222
|
|
6.6
|
|
99.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
5,825,704
|
|
$
6,010,918
|
|
$
5,705,372
|
|
$ 3,641,631
|
|
$ 3,553,694
|
|
(3.1)
|
|
63.9
|
Shore Bancshares,
Inc.
Consolidated Balance
Sheets (Unaudited) - Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
2024
|
|
March 31,
2024
|
|
|
|
|
|
|
|
|
|
|
|
|
compared to
|
|
compared to
|
(In thousands, except
per share data)
|
|
March 31,
2024
|
|
December 31,
2023
|
|
September 30,
2023
|
|
June 30,
2023
|
|
March 31,
2023
|
|
December 31,
2023
|
|
March 31,
2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
deposits
|
|
$
1,200,680
|
|
$
1,258,037
|
|
$
1,211,401
|
|
$
778,963
|
|
$
808,679
|
|
(4.6) %
|
|
48.5
|
Interest-bearing
deposits
|
|
3,983,599
|
|
4,128,083
|
|
3,897,343
|
|
2,158,563
|
|
2,185,883
|
|
(3.5)
|
|
82.2
|
Total
deposits
|
|
5,184,279
|
|
5,386,120
|
|
5,108,744
|
|
2,937,526
|
|
2,994,562
|
|
(3.7)
|
|
73.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advances from FHLB -
short-term
|
|
—
|
|
—
|
|
—
|
|
276,000
|
|
131,500
|
|
—
|
|
(100.0)
|
Guaranteed preferred
beneficial interest in
junior subordinated debentures ("TRUPS")
|
|
29,237
|
|
29,158
|
|
29,079
|
|
18,492
|
|
18,445
|
|
0.3
|
|
58.5
|
Subordinated
debt
|
|
43,322
|
|
43,139
|
|
42,956
|
|
24,735
|
|
24,705
|
|
0.4
|
|
75.4
|
Total
borrowings
|
|
72,559
|
|
72,297
|
|
72,035
|
|
319,227
|
|
174,650
|
|
0.4
|
|
(58.5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lease
liabilities
|
|
12,552
|
|
12,857
|
|
13,082
|
|
9,392
|
|
9,642
|
|
(2.4)
|
|
30.2
|
Accrued expenses and
other liabilities
|
|
41,086
|
|
28,509
|
|
9,933
|
|
12,346
|
|
13,202
|
|
44.1
|
|
211.2
|
Total
liabilities
|
|
5,310,476
|
|
5,499,783
|
|
5,203,794
|
|
3,278,491
|
|
3,192,056
|
|
(3.4)
|
|
66.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock, par value
$0.01; authorized
50,000,000 shares
|
|
332
|
|
332
|
|
331
|
|
199
|
|
199
|
|
—
|
|
66.8
|
Additional paid in
capital
|
|
356,464
|
|
356,007
|
|
355,575
|
|
202,008
|
|
201,736
|
|
0.1
|
|
76.7
|
Retained
earnings
|
|
166,490
|
|
162,290
|
|
155,781
|
|
169,494
|
|
167,864
|
|
2.6
|
|
(0.8)
|
Accumulated other
comprehensive loss
|
|
(8,058)
|
|
(7,494)
|
|
(10,109)
|
|
(8,561)
|
|
(8,161)
|
|
(7.5)
|
|
1.3
|
Total stockholders'
equity
|
|
515,228
|
|
511,135
|
|
501,578
|
|
363,140
|
|
361,638
|
|
0.8
|
|
42.5
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
—
|
Total liabilities
and stockholders' equity
|
|
$
5,825,704
|
|
$
6,010,918
|
|
$
5,705,372
|
|
$ 3,641,631
|
|
$ 3,553,694
|
|
(3.1)
|
|
63.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period-end common
shares outstanding
|
|
33,211
|
|
33,162
|
|
33,136
|
|
19,907
|
|
19,898
|
|
0.1
|
|
66.9
|
Book value per common
share
|
|
$
15.51
|
|
$
15.41
|
|
$
15.14
|
|
$
18.24
|
|
$
18.17
|
|
0.6
|
|
(14.6)
|
Shore Bancshares,
Inc.
Consolidated Statements
of Income By Quarter (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3/31/2024
|
|
3/31/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
compared to
|
|
compared to
|
(In thousands, except
per share data)
|
|
Q1
2024
|
|
Q4 2023
|
|
Q3 2023
|
|
Q2 2023
|
|
Q1 2023
|
|
Q4 2023
|
|
Q1 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
$
65,754
|
|
$
65,914
|
|
$
64,869
|
|
$
32,729
|
|
$
30,828
|
|
(0.2) %
|
|
113.3 %
|
Interest on investment
securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
|
|
4,419
|
|
3,992
|
|
5,047
|
|
3,729
|
|
4,064
|
|
10.7
|
|
8.7
|
Tax-exempt
|
|
6
|
|
6
|
|
27
|
|
5
|
|
7
|
|
—
|
|
(14.3)
|
Interest on federal
funds sold
|
|
—
|
|
—
|
|
92
|
|
—
|
|
—
|
|
—
|
|
—
|
Interest on deposits
with other banks
|
|
960
|
|
1,224
|
|
1,213
|
|
170
|
|
163
|
|
(21.6)
|
|
489.0
|
Total interest
income
|
|
71,139
|
|
71,136
|
|
71,248
|
|
36,633
|
|
35,062
|
|
—
|
|
102.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
28,497
|
|
28,133
|
|
23,473
|
|
9,914
|
|
7,281
|
|
1.3
|
|
291.4
|
Interest on short-term
borrowings
|
|
56
|
|
16
|
|
692
|
|
3,449
|
|
1,361
|
|
250.0
|
|
(95.9)
|
Interest on long-term
borrowings
|
|
1,451
|
|
1,462
|
|
1,461
|
|
776
|
|
756
|
|
(0.8)
|
|
91.9
|
Total interest
expense
|
|
30,004
|
|
29,611
|
|
25,626
|
|
14,139
|
|
9,398
|
|
1.3
|
|
219.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST
INCOME
|
|
41,135
|
|
41,525
|
|
45,622
|
|
22,494
|
|
25,664
|
|
(0.9)
|
|
60.3
|
Provision for credit
losses
|
|
407
|
|
896
|
|
28,176
|
|
667
|
|
1,213
|
|
(54.6)
|
|
(66.4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST INCOME
AFTER PROVISION FOR
CREDIT LOSSES
|
|
40,728
|
|
40,629
|
|
17,446
|
|
21,827
|
|
24,451
|
|
0.2
|
|
66.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NONINTEREST
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service charges on
deposit accounts
|
|
1,507
|
|
1,519
|
|
1,505
|
|
1,264
|
|
1,213
|
|
(0.8)
|
|
24.2
|
Trust and investment
fee income
|
|
734
|
|
844
|
|
1,933
|
|
399
|
|
432
|
|
(13.0)
|
|
69.9
|
Loss on sales and calls
of investment securities
|
|
—
|
|
—
|
|
(2,166)
|
|
—
|
|
—
|
|
—
|
|
—
|
Interchange
credits
|
|
1,587
|
|
1,633
|
|
1,557
|
|
1,311
|
|
1,212
|
|
(2.8)
|
|
30.9
|
Mortgage-banking
revenue
|
|
801
|
|
1,105
|
|
1,377
|
|
1,054
|
|
977
|
|
(27.5)
|
|
(18.0)
|
Title Company
revenue
|
|
78
|
|
139
|
|
89
|
|
186
|
|
137
|
|
(43.9)
|
|
(43.1)
|
Bargain purchase
gain
|
|
—
|
|
—
|
|
8,816
|
|
—
|
|
—
|
|
—
|
|
—
|
Other noninterest
income
|
|
1,860
|
|
2,308
|
|
1,873
|
|
1,080
|
|
1,363
|
|
(19.4)
|
|
36.5
|
Total noninterest
income
|
|
$
6,567
|
|
$
7,548
|
|
$
14,984
|
|
$
5,294
|
|
$
5,334
|
|
(13.0)
|
|
23.1
|
Shore Bancshares,
Inc.
Consolidated Statements
of Income By Quarter (Unaudited) - Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3/31/2024
|
|
3/31/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
compared to
|
|
compared to
|
(In thousands, except
per share data)
|
|
Q1
2024
|
|
Q4 2023
|
|
Q3 2023
|
|
Q2 2023
|
|
Q1 2023
|
|
Q4 2023
|
|
Q1 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NONINTEREST
EXPENSE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and
wages
|
|
$
11,852
|
|
$ 12,823
|
|
$ 14,183
|
|
$
8,955
|
|
$
8,684
|
|
(7.6) %
|
|
36.5 %
|
Employee
benefits
|
|
4,097
|
|
3,389
|
|
3,607
|
|
2,440
|
|
2,921
|
|
20.9
|
|
40.3
|
Occupancy
expense
|
|
2,416
|
|
2,328
|
|
2,245
|
|
1,599
|
|
1,619
|
|
3.8
|
|
49.2
|
Furniture and equipment
expense
|
|
904
|
|
790
|
|
750
|
|
477
|
|
534
|
|
14.4
|
|
69.3
|
Data
processing
|
|
2,867
|
|
2,762
|
|
2,485
|
|
1,739
|
|
1,798
|
|
3.8
|
|
59.5
|
Directors'
fees
|
|
295
|
|
426
|
|
295
|
|
185
|
|
250
|
|
(30.8)
|
|
18.0
|
Amortization of
intangible assets
|
|
2,576
|
|
2,595
|
|
2,634
|
|
435
|
|
441
|
|
(0.7)
|
|
484.1
|
FDIC insurance premium
expense
|
|
1,150
|
|
1,733
|
|
618
|
|
758
|
|
371
|
|
(33.6)
|
|
210.0
|
Other real estate owned
expenses, net
|
|
—
|
|
—
|
|
2
|
|
—
|
|
(1)
|
|
—
|
|
100.0
|
Legal and professional
fees
|
|
1,599
|
|
1,411
|
|
1,217
|
|
959
|
|
750
|
|
13.3
|
|
113.2
|
Fraud losses
(1)
|
|
4,502
|
|
503
|
|
262
|
|
47
|
|
67
|
|
795.0
|
|
6619.4
|
Merger related
expenses
|
|
—
|
|
602
|
|
14,866
|
|
1,197
|
|
691
|
|
(100.0)
|
|
(100.0)
|
Other noninterest
expenses
|
|
4,440
|
|
4,308
|
|
3,994
|
|
2,817
|
|
2,768
|
|
3.1
|
|
60.4
|
Total noninterest
expense
|
|
36,698
|
|
33,670
|
|
47,158
|
|
21,608
|
|
20,893
|
|
9.0
|
|
75.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income/(loss) before
income taxes
|
|
10,597
|
|
14,507
|
|
(14,728)
|
|
5,513
|
|
8,892
|
|
(27.0)
|
|
19.2
|
Income tax
expense/(benefit)
|
|
2,413
|
|
4,017
|
|
(4,991)
|
|
1,495
|
|
2,435
|
|
(39.9)
|
|
(0.9)
|
NET
INCOME/(LOSS)
|
|
$
8,184
|
|
$ 10,490
|
|
$ (9,737)
|
|
$
4,018
|
|
$
6,457
|
|
(22.0)
|
|
26.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding - basic and diluted
|
|
33,337
|
|
33,322
|
|
33,246
|
|
19,903
|
|
19,886
|
|
0.1
|
|
67.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net
income/(loss) per common share
|
|
$
0.25
|
|
$
0.32
|
|
$
(0.29)
|
|
$
0.20
|
|
$
0.32
|
|
(21.9)
|
|
(21.9)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends paid per
common share
|
|
0.12
|
|
0.12
|
|
0.12
|
|
0.12
|
|
0.12
|
|
—
|
|
—
|
____________________________________
|
(1)
|
Fraud losses includes
$4.3 million of credit card fraud losses for the quarter ended
March 31, 2024.
|
Shore Bancshares,
Inc.
Consolidated Average
Balance Sheets By Quarter (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1
2024
|
|
Q4 2023
|
|
Q3 2023
|
|
Q2 2023
|
|
Q1 2023
|
(Dollars in
thousands)
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earning
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans (1), (2),
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer real
estate
|
|
$
1,361,636
|
|
$
18,492
|
|
5.46 %
|
|
$
1,331,150
|
|
$
18,653
|
|
5.56 %
|
|
$
1,141,707
|
|
$
14,548
|
|
5.06 %
|
|
$
946,545
|
|
$
10,876
|
|
4.61 %
|
|
$
881,799
|
|
$
10,507
|
|
4.83 %
|
Commercial real
estate
|
|
2,722,600
|
|
38,604
|
|
5.70
|
|
2,728,094
|
|
38,730
|
|
5.63
|
|
2,831,569
|
|
40,536
|
|
5.68
|
|
1,292,406
|
|
15,620
|
|
4.85
|
|
1,279,923
|
|
15,173
|
|
4.81
|
Commercial
|
|
219,884
|
|
4,097
|
|
7.49
|
|
221,342
|
|
4,295
|
|
7.70
|
|
233,756
|
|
5,315
|
|
9.02
|
|
137,554
|
|
2,177
|
|
6.35
|
|
142,797
|
|
1,819
|
|
5.17
|
Consumer
|
|
329,118
|
|
4,272
|
|
5.22
|
|
333,807
|
|
3,859
|
|
4.59
|
|
332,486
|
|
4,183
|
|
4.99
|
|
323,798
|
|
3,983
|
|
4.93
|
|
297,528
|
|
3,274
|
|
4.46
|
State and
political
|
|
1,473
|
|
16
|
|
4.37
|
|
1,290
|
|
13
|
|
4.00
|
|
929
|
|
10
|
|
4.27
|
|
900
|
|
8
|
|
3.57
|
|
978
|
|
9
|
|
3.73
|
Credit Cards
|
|
7,457
|
|
167
|
|
9.01
|
|
6,320
|
|
166
|
|
10.42
|
|
6,164
|
|
149
|
|
9.59
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Other
|
|
13,015
|
|
183
|
|
5.66
|
|
17,464
|
|
277
|
|
6.29
|
|
16,137
|
|
201
|
|
4.94
|
|
8,741
|
|
116
|
|
5.37
|
|
8,619
|
|
84
|
|
3.91
|
Total Loans
|
|
4,655,183
|
|
65,831
|
|
5.69
|
|
4,639,467
|
|
65,993
|
|
5.64
|
|
4,562,748
|
|
64,942
|
|
5.65
|
|
2,709,944
|
|
32,780
|
|
4.85
|
|
2,611,644
|
|
30,866
|
|
4.79
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment
securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
|
|
654,663
|
|
4,419
|
|
2.70
|
|
619,259
|
|
3,992
|
|
2.58
|
|
778,081
|
|
5,047
|
|
2.59
|
|
645,178
|
|
3,729
|
|
2.32
|
|
653,527
|
|
4,064
|
|
2.49
|
Tax-exempt
(1)
|
|
660
|
|
8
|
|
4.85
|
|
661
|
|
8
|
|
4.84
|
|
663
|
|
34
|
|
20.51
|
|
664
|
|
6
|
|
3.62
|
|
666
|
|
9
|
|
5.41
|
Federal funds
sold
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
7,533
|
|
92
|
|
4.85
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Interest-bearing
deposits
|
|
77,276
|
|
960
|
|
5.00
|
|
80,446
|
|
1,224
|
|
6.04
|
|
55,547
|
|
1,213
|
|
8.66
|
|
13,397
|
|
170
|
|
5.09
|
|
13,849
|
|
163
|
|
4.77
|
Total earning
assets
|
|
5,387,782
|
|
71,218
|
|
5.32
|
|
5,339,833
|
|
71,217
|
|
5.29
|
|
5,404,572
|
|
71,328
|
|
5.24
|
|
3,369,183
|
|
36,685
|
|
4.37
|
|
3,279,686
|
|
35,102
|
|
4.34
|
Cash and due from
banks
|
|
49,499
|
|
|
|
|
|
63,506
|
|
|
|
|
|
51,714
|
|
|
|
|
|
29,923
|
|
|
|
|
|
28,602
|
|
|
|
|
Other assets
|
|
395,023
|
|
|
|
|
|
399,409
|
|
|
|
|
|
359,726
|
|
|
|
|
|
225,935
|
|
|
|
|
|
228,054
|
|
|
|
|
Allowance for credit
losses
|
|
(57,480)
|
|
|
|
|
|
(57,308)
|
|
|
|
|
|
(46,700)
|
|
|
|
|
|
(28,730)
|
|
|
|
|
|
(30,006)
|
|
|
|
|
Total
assets
|
|
$
5,774,824
|
|
|
|
|
|
$
5,745,440
|
|
|
|
|
|
$
5,769,312
|
|
|
|
|
|
$
3,596,311
|
|
|
|
|
|
$
3,506,336
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits
|
|
$
1,110,524
|
|
$
6,362
|
|
2.30 %
|
|
$
1,117,117
|
|
$
6,673
|
|
2.37 %
|
|
$
1,056,956
|
|
$
6,659
|
|
2.50 %
|
|
$
685,674
|
|
$
3,913
|
|
2.29 %
|
|
$
694,894
|
|
$
3,236
|
|
1.89 %
|
Money market and
savings deposits
|
|
1,669,074
|
|
10,160
|
|
2.45
|
|
1,605,930
|
|
8,330
|
|
2.06
|
|
1,572,920
|
|
6,810
|
|
1.72
|
|
907,068
|
|
2,526
|
|
1.12
|
|
1,004,553
|
|
2,374
|
|
0.96
|
Brokered
deposits
|
|
20,465
|
|
251
|
|
4.93
|
|
92,840
|
|
1,347
|
|
5.76
|
|
98,649
|
|
1,225
|
|
4.93
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Certificates of deposit
$100,000 or more
|
|
762,210
|
|
7,675
|
|
4.05
|
|
701,051
|
|
6,898
|
|
3.90
|
|
706,642
|
|
6,272
|
|
3.52
|
|
312,367
|
|
2,337
|
|
3.00
|
|
241,436
|
|
1,076
|
|
1.81
|
Other time
deposits
|
|
417,362
|
|
4,049
|
|
3.90
|
|
391,820
|
|
4,885
|
|
4.95
|
|
285,743
|
|
2,507
|
|
3.48
|
|
225,495
|
|
1,138
|
|
2.03
|
|
207,403
|
|
595
|
|
1.16
|
Interest-bearing
deposits (4)
|
|
3,979,635
|
|
28,497
|
|
2.88
|
|
3,908,758
|
|
28,133
|
|
2.86
|
|
3,720,910
|
|
23,473
|
|
2.50
|
|
2,130,604
|
|
9,914
|
|
1.87
|
|
2,148,286
|
|
7,281
|
|
1.37
|
Advances from FHLB -
short-term
|
|
4,000
|
|
56
|
|
5.63
|
|
1,141
|
|
16
|
|
5.56
|
|
70,348
|
|
692
|
|
3.90
|
|
261,797
|
|
3,449
|
|
5.28
|
|
113,972
|
|
1,361
|
|
4.84
|
Subordinated debt and
Guaranteed preferred
beneficial interest in junior subordinated
debentures ("TRUPS") (4)
|
|
72,418
|
|
1,451
|
|
8.06
|
|
72,155
|
|
1,462
|
|
8.04
|
|
71,907
|
|
1,461
|
|
8.06
|
|
43,185
|
|
776
|
|
7.21
|
|
43,108
|
|
756
|
|
7.11
|
Total
interest-bearing liabilities
|
|
4,056,053
|
|
30,004
|
|
2.98
|
|
3,982,054
|
|
29,611
|
|
2.95
|
|
3,863,165
|
|
25,626
|
|
2.63
|
|
2,435,586
|
|
14,139
|
|
2.33
|
|
2,305,366
|
|
9,398
|
|
1.65
|
Noninterest-bearing
deposits
|
|
1,163,023
|
|
|
|
|
|
1,228,060
|
|
|
|
|
|
1,345,976
|
|
|
|
|
|
778,058
|
|
|
|
|
|
820,162
|
|
|
|
|
Accrued expenses and
other liabilities
|
|
39,772
|
|
|
|
|
|
28,286
|
|
|
|
|
|
27,057
|
|
|
|
|
|
19,442
|
|
|
|
|
|
19,634
|
|
|
|
|
Stockholders'
equity
|
|
515,976
|
|
|
|
|
|
507,040
|
|
|
|
|
|
533,114
|
|
|
|
|
|
363,225
|
|
|
|
|
|
361,174
|
|
|
|
|
Total liabilities
and stockholders' equity
|
|
$
5,774,824
|
|
|
|
|
|
$
5,745,440
|
|
|
|
|
|
$
5,769,312
|
|
|
|
|
|
$
3,596,311
|
|
|
|
|
|
$
3,506,336
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
$
41,214
|
|
|
|
|
|
$
41,606
|
|
|
|
|
|
$
45,702
|
|
|
|
|
|
$
22,546
|
|
|
|
|
|
$
25,704
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
spread
|
|
|
|
|
|
2.34 %
|
|
|
|
|
|
2.34 %
|
|
|
|
|
|
2.61 %
|
|
|
|
|
|
2.04 %
|
|
|
|
|
|
2.69 %
|
Net interest
margin
|
|
|
|
|
|
3.08 %
|
|
|
|
|
|
3.09 %
|
|
|
|
|
|
3.35 %
|
|
|
|
|
|
2.68 %
|
|
|
|
|
|
3.18 %
|
Cost of
Funds
|
|
|
|
|
|
2.31 %
|
|
|
|
|
|
2.25 %
|
|
|
|
|
|
1.95 %
|
|
|
|
|
|
1.76 %
|
|
|
|
|
|
1.22 %
|
Cost of
Deposits
|
|
|
|
|
|
2.23 %
|
|
|
|
|
|
2.17 %
|
|
|
|
|
|
1.84 %
|
|
|
|
|
|
1.37 %
|
|
|
|
|
|
0.99 %
|
Cost of Debt
|
|
|
|
|
|
7.93 %
|
|
|
|
|
|
8.00 %
|
|
|
|
|
|
6.00 %
|
|
|
|
|
|
5.56 %
|
|
|
|
|
|
5.47 %
|
____________________________________
|
(1)
|
All amounts are
reported on a tax-equivalent basis computed using the statutory
federal income tax rate of 21.0%, exclusive of nondeductible
interest expense.
|
(2)
|
Average loan balances
include nonaccrual loans.
|
(3)
|
Interest income on
loans includes accreted loan fees, net of costs and accretion of
discounts on acquired loans, which are included in the yield
calculations. There were $4.2 million, $4.8 million, $6.1 million,
$0.3 million and $0.5 million of accretion interest on loans for
the three months ended March 31, 2024, December 31, 2023,
September 30, 2023, June 30, 2023, and March 31,
2023, respectively.
|
(4)
|
Interest expense on
deposits and borrowing includes amortization of deposit premiums
and amortization of borrowing fair value adjustment. There
were $(0.4) million, $(1.5) million, $(0.5) million, $41,000
and $0.1 million of amortization of deposits premium,
and $(0.2) million, $(0.2) million, $(0.2) million, $(47,000)
and $(47,000) of amortization of borrowing fair value adjustment
for the three months ended March 31, 2024, December 31,
2023, September 30, 2023, June 30, 2023, and
March 31, 2023, respectively.
|
Shore Bancshares,
Inc.
Reconciliation of
Generally Accepted Accounting Principles (GAAP) and Non-GAAP
Measures (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YTD
|
|
YTD
|
(In thousands, except
per share data)
|
|
Q1
2024
|
|
Q4 2023
|
|
Q3 2023
|
|
Q2 2023
|
|
Q1 2023
|
|
3/31/2024
|
|
3/31/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following
reconciles return on average assets, average equity and return
on average tangible equity (Note 1):
|
Net income
(loss)
|
|
$
8,184
|
|
$
10,490
|
|
$
(9,737)
|
|
$
4,018
|
|
$
6,457
|
|
$
8,184
|
|
$
6,457
|
Net income
(loss) - annualized (A)
|
|
$
32,916
|
|
$
41,618
|
|
$ (38,632)
|
|
$
16,295
|
|
$
26,187
|
|
$
32,916
|
|
$
26,187
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
8,184
|
|
$
10,490
|
|
$
(9,737)
|
|
$
4,018
|
|
$
6,457
|
|
$
8,184
|
|
$
6,457
|
Add: Amortization of
intangible assets, net of tax
|
|
1,989
|
|
1,876
|
|
1,741
|
|
317
|
|
320
|
|
1,989
|
|
320
|
Add: Merger Expenses,
net of tax
|
|
—
|
|
435
|
|
9,828
|
|
872
|
|
502
|
|
—
|
|
502
|
Add: Credit Card Fraud
Losses, net of tax
|
|
3,339
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3,339
|
|
—
|
Net income, excluding
net amortization of intangible assets, merger
related expenses and credit card fraud losses
|
|
13,512
|
|
12,801
|
|
1,832
|
|
5,207
|
|
7,279
|
|
13,512
|
|
7,279
|
Net income, excluding
net amortization of intangible assets, merger
related expenses and credit card fraud losses - annualized
(B)
|
|
$
54,345
|
|
$
50,787
|
|
$
7,268
|
|
$
21,121
|
|
$
29,520
|
|
$
54,345
|
|
$
29,520
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (GAAP)
|
|
0.57 %
|
|
0.72 %
|
|
(0.67) %
|
|
0.45 %
|
|
0.75 %
|
|
0.57 %
|
|
0.75 %
|
Return on average
assets excluding net amortization of intangible
assets, merger related expenses and credit card fraud losses-
(Non-GAAP)
|
|
0.94 %
|
|
0.88 %
|
|
0.01 %
|
|
0.59 %
|
|
0.84 %
|
|
0.94 %
|
|
0.84 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
assets
|
|
$
5,774,824
|
|
$
5,745,440
|
|
$
5,769,312
|
|
$
3,596,311
|
|
$
3,506,336
|
|
$
5,774,824
|
|
$
3,506,336
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average stockholders'
equity (C)
|
|
$
515,976
|
|
$ 507,040
|
|
$ 533,114
|
|
$ 363,225
|
|
$ 361,174
|
|
$ 515,976
|
|
$ 361,174
|
Less: Average goodwill
and core deposit intangible
|
|
(110,167)
|
|
(112,752)
|
|
(115,604)
|
|
(68,172)
|
|
(68,607)
|
|
(110,167)
|
|
(68,607)
|
Average tangible equity
(D)
|
|
$
405,809
|
|
$ 394,288
|
|
$ 417,510
|
|
$ 295,053
|
|
$ 292,567
|
|
$ 405,809
|
|
$ 292,567
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
equity (GAAP) (A)/(C)
|
|
6.38 %
|
|
8.21 %
|
|
(7.25) %
|
|
4.49 %
|
|
7.25 %
|
|
6.38 %
|
|
7.25 %
|
Return on average
tangible equity (Non-GAAP) (B)/(D)
|
|
13.39 %
|
|
12.88 %
|
|
1.74 %
|
|
7.16 %
|
|
10.09 %
|
|
13.39 %
|
|
10.09 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following
reconciles GAAP efficiency ratio and non-GAAP efficiency ratio
(Note 2):
|
Noninterest expense
(E)
|
|
$
36,698
|
|
$
33,670
|
|
$
47,158
|
|
$
21,608
|
|
$
20,893
|
|
$
36,698
|
|
$
20,893
|
Less: Amortization of
intangible assets
|
|
(2,576)
|
|
(2,595)
|
|
(2,634)
|
|
(435)
|
|
(441)
|
|
(2,576)
|
|
(441)
|
Less: Merger
Expenses
|
|
—
|
|
(602)
|
|
(14,866)
|
|
(1,197)
|
|
(691)
|
|
—
|
|
(691)
|
Less: Credit Card Fraud
Losses
|
|
(4,323)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(4,323)
|
|
—
|
Adjusted noninterest
expense (F)
|
|
$
29,799
|
|
$
30,473
|
|
$
29,658
|
|
$
19,976
|
|
$
19,761
|
|
$
29,799
|
|
$
19,761
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
(G)
|
|
$
41,135
|
|
$
41,525
|
|
$
45,622
|
|
$
22,494
|
|
$
25,664
|
|
$
41,135
|
|
$
25,664
|
Add: Taxable-equivalent
adjustment
|
|
79
|
|
81
|
|
80
|
|
51
|
|
40
|
|
79
|
|
40
|
Taxable-equivalent net
interest income (H)
|
|
$
41,214
|
|
$
41,606
|
|
$
45,702
|
|
$
22,545
|
|
$
25,704
|
|
$
41,214
|
|
$
25,704
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest income
(I)
|
|
$
6,567
|
|
$
7,548
|
|
$
14,984
|
|
$
5,294
|
|
$
5,334
|
|
$
6,567
|
|
$
5,334
|
Investment securities
losses (gains)
|
|
—
|
|
—
|
|
2,166
|
|
—
|
|
—
|
|
—
|
|
—
|
Adjusted noninterest
income (J)
|
|
$
6,567
|
|
$
7,548
|
|
$
17,150
|
|
$
5,294
|
|
$
5,334
|
|
$
6,567
|
|
$
5,334
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency ratio
(GAAP) (E)/(G)+(I)
|
|
76.93 %
|
|
68.61 %
|
|
77.81 %
|
|
77.76 %
|
|
67.40 %
|
|
76.93 %
|
|
67.40 %
|
Efficiency ratio
(Non-GAAP) (F)/(H)+(J)
|
|
62.37 %
|
|
61.99 %
|
|
47.19 %
|
|
71.76 %
|
|
63.67 %
|
|
62.37 %
|
|
63.67 %
|
Shore Bancshares,
Inc.
Reconciliation of
Generally Accepted Accounting Principles (GAAP) and Non-GAAP
Measures (Unaudited) - Continued
|
|
(In thousands, except
per share data)
|
|
Q1
2024
|
|
Q4 2023
|
|
Q3 2023
|
|
Q2 2023
|
|
Q1 2023
|
|
|
|
|
|
|
|
|
|
|
|
The following
reconciles book value per common share and tangible book value per
common share (Note 1):
|
Stockholders' equity
(K)
|
|
$
515,228
|
|
$
511,135
|
|
$
501,578
|
|
$
363,140
|
|
$
361,638
|
Less: Goodwill and core
deposit intangible
|
|
(108,781)
|
|
(111,356)
|
|
(113,951)
|
|
(67,937)
|
|
(68,372)
|
Tangible equity
(L)
|
|
$
406,447
|
|
$
399,779
|
|
$
387,627
|
|
$
295,203
|
|
$
293,266
|
|
|
|
|
|
|
|
|
|
|
|
Shares outstanding
(M)
|
|
33,211
|
|
33,162
|
|
33,136
|
|
19,907
|
|
19,898
|
|
|
|
|
|
|
|
|
|
|
|
Book value per common
share (GAAP) (K)/(M)
|
|
$
15.51
|
|
$
15.41
|
|
$
15.14
|
|
$
18.24
|
|
$
18.17
|
Tangible book value per
common share (Non-GAAP) (L)/(M)
|
|
$
12.24
|
|
$
12.06
|
|
$
11.70
|
|
$
14.83
|
|
$
14.74
|
|
|
|
|
|
|
|
|
|
|
|
The following
reconciles equity to assets and tangible equity to tangible assets
(Note 1):
|
Stockholders' equity
(N)
|
|
$
515,228
|
|
$
511,135
|
|
$
501,578
|
|
$
363,140
|
|
$
361,638
|
Less: Goodwill and core
deposit intangible
|
|
(108,781)
|
|
(111,356)
|
|
(113,951)
|
|
(67,937)
|
|
(68,372)
|
Tangible equity
(O)
|
|
$
406,447
|
|
$
399,779
|
|
$
387,627
|
|
$
295,203
|
|
$
293,266
|
|
|
|
|
|
|
|
|
|
|
|
Assets (P)
|
|
$
5,825,704
|
|
$
6,010,918
|
|
$
5,705,372
|
|
$
3,641,631
|
|
$
3,553,694
|
Less: Goodwill and core
deposit intangible
|
|
(108,781)
|
|
(111,356)
|
|
(113,951)
|
|
(67,937)
|
|
(68,372)
|
Tangible assets
(Q)
|
|
$
5,716,923
|
|
$
5,899,562
|
|
$
5,591,421
|
|
$
3,573,694
|
|
$
3,485,322
|
|
|
|
|
|
|
|
|
|
|
|
Period-end
equity/assets (GAAP) (N)/(P)
|
|
8.84 %
|
|
8.50 %
|
|
8.79 %
|
|
9.97 %
|
|
10.18 %
|
Period-end tangible
equity/tangible assets (Non-GAAP) (O)/(Q)
|
|
7.11 %
|
|
6.78 %
|
|
6.93 %
|
|
8.26 %
|
|
8.41 %
|
____________________________________
|
Note 1:
|
Management believes
that reporting tangible equity and tangible assets more closely
approximates the adequacy of capital for regulatory
purposes.
|
Note 2:
|
Management believes
that reporting the non-GAAP efficiency ratio more closely measures
its effectiveness of controlling cash-based operating
activities.
|
Shore Bancshares,
Inc.
Summary of Loan
Portfolio (Unaudited)
Portfolio loans are
summarized by loan type as follows:
|
|
(Dollars in
thousands)
|
|
March 31,
2024
|
|
%
|
|
December 31,
2023
|
|
%
|
|
September 30,
2023
|
|
%
|
|
June 30,
2023
|
|
%
|
|
March 31,
2023
|
|
%
|
Portfolio Loans by
Loan Type
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction
|
|
$
299,133
|
|
6.43 %
|
|
$
299,000
|
|
6.44 %
|
|
$
328,750
|
|
7.12 %
|
|
$
220,228
|
|
8.00 %
|
|
$
250,447
|
|
9.38 %
|
Residential real
estate
|
|
1,515,134
|
|
32.59 %
|
|
1,490,438
|
|
32.11 %
|
|
1,439,464
|
|
31.17 %
|
|
938,151
|
|
34.07 %
|
|
866,225
|
|
32.46 %
|
Commercial real
estate
|
|
2,272,867
|
|
48.90 %
|
|
2,286,154
|
|
49.27 %
|
|
2,283,521
|
|
49.45 %
|
|
1,130,346
|
|
41.06 %
|
|
1,096,937
|
|
41.11 %
|
Commercial
|
|
229,594
|
|
4.94 %
|
|
229,939
|
|
4.95 %
|
|
229,474
|
|
4.97 %
|
|
138,459
|
|
5.03 %
|
|
140,312
|
|
5.26 %
|
Consumer
|
|
325,076
|
|
6.99 %
|
|
328,896
|
|
7.09 %
|
|
330,411
|
|
7.16 %
|
|
326,039
|
|
11.84 %
|
|
314,760
|
|
11.79 %
|
Credit
Cards
|
|
6,921
|
|
0.15 %
|
|
6,583
|
|
0.14 %
|
|
6,099
|
|
0.13 %
|
|
—
|
|
— %
|
|
—
|
|
— %
|
Total
loans
|
|
4,648,725
|
|
100.00 %
|
|
4,641,010
|
|
100.00 %
|
|
4,617,719
|
|
100.00 %
|
|
2,753,223
|
|
100.00 %
|
|
2,668,681
|
|
100.00 %
|
Less: Allowance for
credit losses
|
|
(57,336)
|
|
|
|
(57,351)
|
|
|
|
(57,051)
|
|
|
|
(29,014)
|
|
|
|
(28,464)
|
|
|
Total loans,
net
|
|
$
4,591,389
|
|
|
|
$
4,583,659
|
|
|
|
$
4,560,668
|
|
|
|
$
2,724,209
|
|
|
|
$
2,640,217
|
|
|
Shore Bancshares, Inc.
Summary of Deposits
(Unaudited)
|
|
|
|
March 31,
2024
|
|
December 31,
2023
|
|
September 30,
2023
|
|
June 30,
2023
|
|
March 31,
2023
|
(dollars in
thousands)
|
|
Balance
|
|
%
|
|
Balance
|
|
%
|
|
Balance
|
|
%
|
|
Balance
|
|
%
|
|
Balance
|
|
%
|
Noninterest-bearing
demand
|
|
$
1,200,680
|
|
23.15 %
|
|
$
1,258,037
|
|
23.36 %
|
|
$
1,211,401
|
|
23.70 %
|
|
$
778,963
|
|
26.52 %
|
|
$
808,679
|
|
27.00 %
|
Interest-bearing:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
|
|
1,101,954
|
|
21.26 %
|
|
1,165,546
|
|
21.64 %
|
|
1,210,051
|
|
23.69 %
|
|
694,221
|
|
23.63 %
|
|
726,070
|
|
24.25 %
|
Money market
deposits
|
|
1,358,205
|
|
26.20 %
|
|
1,430,603
|
|
26.56 %
|
|
1,179,049
|
|
23.08 %
|
|
600,724
|
|
20.45 %
|
|
675,751
|
|
22.57 %
|
Savings
|
|
354,098
|
|
6.83 %
|
|
347,324
|
|
6.45 %
|
|
371,755
|
|
7.28 %
|
|
270,884
|
|
9.22 %
|
|
295,002
|
|
9.85 %
|
Certificates of
deposit
|
|
1,169,342
|
|
22.56 %
|
|
1,184,610
|
|
21.99 %
|
|
1,136,488
|
|
22.25 %
|
|
592,734
|
|
20.18 %
|
|
489,060
|
|
16.33 %
|
Total
interest-bearing
|
|
3,983,599
|
|
76.85 %
|
|
4,128,083
|
|
76.64 %
|
|
3,897,343
|
|
76.30 %
|
|
2,158,563
|
|
73.48 %
|
|
2,185,883
|
|
73.00 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Deposits
|
|
$
5,184,279
|
|
100.00 %
|
|
$
5,386,120
|
|
100.00 %
|
|
$
5,108,744
|
|
100.00 %
|
|
$
2,937,526
|
|
100.00 %
|
|
$
2,994,562
|
|
100.00 %
|
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SOURCE Shore Bancshares, Inc.