0001035092false00010350922024-07-252024-07-25

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 25, 2024
Shore_Bancshares_Logo.jpg
SHORE BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
Maryland000-2234552-1974638
(State or other jurisdiction of incorporation or organization)(Commission file number)(IRS Employer Identification No.)
18 E. Dover St., Easton, Maryland 21601
(Address of principal executive offices) (Zip Code)
(410) 763-7800
(Registrant’s telephone number, including area code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:
oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading SymbolName of Each Exchange on Which Registered
Common stock, par value $.01 per shareSHBINasdaq Global Select Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o


Item 2.02. Result of Operation and Financial Condition.
On July 25, 2024, Shore Bancshares, Inc. (the “Company”) issued a press release announcing its results of operations and financial condition for the three and six months ended June 30, 2024. A copy of the Company’s press release is attached hereto as Exhibit 99.1 and hereby incorporated by reference.
The information furnished under Item 2.02 and Item 9.01 of this Current Report on Form 8-K, including the exhibit, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liabilities under that Section, nor shall it be deemed incorporated by reference in any registration statement or other filings of the Company under the Securities Act of 1933, as amended, except as shall be set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d)Exhibits.
The exhibits that are filed or furnished with this report are listed in the Exhibit Index that immediately follows the signatures hereto, which list is incorporated herein by reference.
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EXHIBIT INDEX
Exhibit Number
Description
104
Cover Page Interactive Data File (embedded within the inline XBRL document)
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
SHORE BANCSHARES, INC.
Dated: July 25, 2024
By:/s/ James M. Burke
James M. Burke
President and Chief Executive Officer
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shore_bancsharesxlogo.jpg
18 E. Dover Street
Easton, Maryland 21601
Phone 410-763-7800
PRESS RELEASE
Shore Bancshares, Inc. Reports Second Quarter and First-Half Financial Results
Easton, Maryland (July 25, 2024) - 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 second quarter of 2024 of $11.2 million or $0.34 per diluted common share compared to net income of $8.2 million or $0.25 per diluted common share for the first quarter of 2024, and net income of $4.0 million or $0.20 per diluted common share for the second quarter of 2023. Net income for the first-half of 2024 was $19.4 million or $0.58 per diluted common share, compared to net income for the first-half of 2023 of $10.5 million or $0.53 per diluted common share. Unless the context clearly suggests otherwise, references to “the merger” refers to the merger of equals which took place on July 1, 2023 between the Company and The Community Financial Corporation (“TCFC”).
Second Quarter and First-Half of 2024 Highlights
■Return on Average Assets (“ROAA”) - The Company reported ROAA of 0.77% for the second quarter of 2024, compared to 0.57% for the first quarter of 2024 and 0.45% for the second quarter of 2023. Non-GAAP, ROAA(1), which excludes fraud expense, core deposit intangible amortization, and merger-related expenses, was 0.91% for the second quarter of 2024, compared to 0.94% for the first quarter of 2024 and 0.59% for the second quarter of 2023.
■Net Interest Margin Expansion - Net interest margin (“NIM”) increased to 3.11% for the second quarter of 2024 from 3.08% for the first quarter of 2024. Excluding net accretion interest income of $3.8 million and $3.6 million for the same time periods, NIM increased two basis points (“bps”) to 2.83% for the second quarter of 2024 from 2.81% for the first quarter of 2024.
■Continued Stable and Low Cost Funding - Total deposits remained stable in the second quarter of 2024 with noninterest-bearing deposits increasing $386.6 million to 30.8% of total deposits. The increase in noninterest-bearing deposits was primarily due to the migration of low-cost demand deposits to noninterest-bearing deposits and successful initiatives designed to drive noninterest-bearing deposit growth. The total average cost of deposits for the second quarter of 2024 declined four bps to 2.19% when compared to the first quarter of 2024.
■Improving Earnings Drive Capital Accretion - Second quarter net interest income and noninterest income increased $1.0 million and $1.9 million, respectively, from the first quarter of 2024. Net interest income increased due to modest loan growth, slightly higher accelerated accretion income, and loan and securities repricing. Noninterest income increased primarily due to higher mortgage-banking revenue from increased volume and sales of residential mortgages. The improved earnings for the second quarter resulted in a 14 bps increase in the Company’s Tier 1 Capital Ratio and a 14 bps increase in the Company’s Total Risk-Based Capital Ratio, which were 9.67% and 11.82%, respectively, on June 30, 2024. The Company’s leverage ratio and tangible common equity ratio(1) also increased to 8.07% and 7.23%, respectively, in the second quarter of 2024.
■Reduced Commercial Real Estate (“CRE”) Concentration - The CRE Concentration Ratio, which is calculated as non-owner occupied CRE loans as a percentage of the Bank’s Tier 1 Capital + Allowance for Credit Losses (“ACL”), decreased in the second quarter of 2024 to 368.7% from 370.0% in the first quarter of 2024 and 382.6% in the fourth quarter of 2023. Capital accretion has allowed the Bank to meet the needs of its customers and fund new CRE loans.
■Improving Operating Leverage - The second quarter efficiency ratio improved to 66.2% when compared to 76.9% in the first quarter 2024 and 77.8% in the second quarter 2023. The second quarter non-GAAP efficiency, which excludes core deposit intangible amortization and non-recurring activity, improved to 61.1% when compared to 62.4% in the first quarter 2024 and 71.8% in the second quarter 2023. Management anticipates ongoing expense management and technology investments will result in continued improvements in operating leverage over time.
“Throughout our first post-merger operating year, we have worked to strengthen our balance sheet and streamline our operations. Our second quarter financial results reflect our progress and momentum on both fronts.” stated James (“Jimmy”) M. Burke, President and Chief Executive Officer of Shore Bancshares, Inc. “Stable deposit balances and increasing asset yields drove NIM expansion and improving financial results built capital and supported loan growth. We continue to closely manage expenses and make investments that will improve
(1) Reconciliations of the non–U.S. generally accepted accounting principles (“GAAP”) measures are set forth at the end of this press release.
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operating leverage over time. Credit remains broadly stable and economic activity in our markets remains strong. We appreciate the focus and commitment of all our associates who continue to deliver outstanding service to our clients and our communities.”
Balance Sheet Review
Total assets were $5.9 billion at June 30, 2024, a decrease of $145 million or 2.4%, 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 $233.5 million and investment securities held to maturity of $13.8 million partially offset by an increase in investment securities available for sale of $21.1 million and loans held for investment of $64.7 million. The ratio of the ACL to total loans increased slightly from 1.23% at December 31, 2023 to 1.24% at June 30, 2024.
The Company’s tangible common equity ratio(1) at June 30, 2024 was 7.23% compared to 7.11% at December 31, 2023. The Company’s Tier 1 and Total Risk-Based Capital Ratios at June 30, 2024 were 9.67% and 11.82%, respectively. The Bank’s Tier 1 and Total Risk-Based Capital Ratios at June 30, 2024 were 10.45% and 11.69%, respectively. Non-owner occupied CRE loans as a percentage of the Bank’s Tier 1 Capital + ACL at June 30, 2024 and December 31, 2023 were $2.1 billion or 368.7% and $2.0 billion or 382.6%, respectively. Construction loans as a percentage of the Bank’s Tier 1 Capital + ACL at June 30, 2024 and December 31, 2023 were $327.9 million or 58.6% and $299.0 million or 56.7%, respectively.
The Bank's office CRE loan portfolio, which includes owner-occupied and non-owner occupied CRE loans, was $504.9 million or 10.7% of total loans of $4.7 billion at June 30, 2024. The Bank’s office CRE loan portfolio included $141.1 million or 28.0% of the total with medical tenants and $72.9 million or 14.4% of the total with government or government contractor tenants. There were 507 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 for the office CRE portfolio are summarized below and LTV collateral values are based on the most recent appraisal, which varies from the initial loan boarding to interim credit reviews:
LTV RangeLoan Count Loan Balance % of Total CRE
Less than or equal to 50%257$169,209 34 %
50%-60%67131,378 26 %
60%-70%8499,728 20 %
70%-80%7487,971 17 %
Greater than 80%2516,583 3 %
Grand Total507$504,869 100 %
The Bank had 18 office CRE loans totaling $164.1 million that were greater than $5.0 million at June 30, 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 two large loan payoffs in the quarter. For the office CRE portfolio, at June 30, 2024, the average loan debt-service coverage ratio was 2.5x and average LTV was 51.0%. Of the office CRE portfolio balance, 74% is secured by properties in rural or suburban areas with limited exposure to metropolitan cities and 87% is secured by properties with five stories or less. Of the office CRE loans, $5.9 million will mature and $4.1 million of the office CRE loans will reprice prior to December 31, 2024. Of the office CRE loans, $2.1 million were classified as special mention or substandard at June 30, 2024.
Total deposits decreased $237.2 million, or 4.4% to $5.1 billion at June 30, 2024 when compared to December 31, 2023. The decrease in total deposits was primarily due to decreases in demand deposits of $507.0 million and money market and savings of $88.6 million, partially offset by increases in noninterest-bearing deposits of $329.2 million and time deposits of $29.2 million. The decrease in deposits is primarily attributable to seasonal municipal runoff and a decrease in interest rate-sensitive cannabis-related deposits. The increase in noninterest bearing deposits was significantly impacted by a transfer of $399.4 million of demand deposits which carried an average rate of four bps during the second quarter of 2024.
Total funding, which includes customer deposits, Federal Home Loan Bank (“FHLB”) short and long-term advances, and brokered deposits remained flat at $5.2 billion at June 30, 2024 and March 31, 2024. The Bank had $81 million in total FHLB advances at June 30, 2024 compared to zero at March 31, 2024. These advances consisted of short-term direct rate credits of $31 million and an 18-month Bermuda Convertible of $50 million. The Bank's uninsured deposits at June 30, 2024 were $948.9 million or 18.43% of total deposits. The Bank's uninsured deposits, excluding deposits secured with pledged collateral, at June 30, 2024 were $819.4 million or 15.91% of total deposits. At June 30, 2024, the Bank had approximately $1.0 billion of available liquidity including: $138.9 million in cash, $894.3 million in secured borrowing capacity at the FHLB and other correspondent banks, and $95.0 million in unsecured lines of credit.
Total stockholders’ equity increased $11.6 million, or 2.3%, when compared to December 31, 2023, primarily due to current year earnings, offset by cash dividends paid. As of June 30, 2024, the ratio of total equity to total assets was 8.92% and the ratio of total tangible equity to total tangible assets(1) was 7.23% compared to 8.50% and 6.78% at December 31, 2023, respectively.
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Review of Quarterly Financial Results
Net interest income was $42.1 million for the second quarter of 2024, compared to $41.1 million for the first quarter of 2024 and $22.5 million for the second quarter of 2023. The increase in net interest income when compared to the first quarter of 2024 was primarily due to the increase in interest and fees on loans of $1.5 million and interest and dividends on investment securities of $0.8 million, partially offset by an increase in interest expense of $1.0 million. The increase in interest expense in the second quarter of 2024 was the result of carrying short-term advances from FHLB during the quarter to offset seasonal outflows from municipal customers of $1.5 million, partially offset by lower interest expense on deposits of $0.9 million. The increase when compared to the second quarter of 2023 was primarily due to the increase in interest and fees on loans of $34.6 million, interest and dividends on investment securities of $1.5 million and interest on deposits from other banks of $0.4 million, coupled with a decrease in interest on short-term borrowings of $1.9 million. These increases were partially offset by the increase in interest on deposits of $17.7 million and interest on long-term borrowings of $1.0 million all significantly impacted by the merger in the third quarter of 2023.
The Company’s net interest margin increased to 3.11% for the second quarter of 2024 from 3.08% for the first quarter of 2024 primarily due to loans and securities repricing at a greater rate than deposits. The Company’s cost of funds was positively impacted during the second quarter due to a shift from interest-bearing to noninterest-bearing deposits. Average interest-bearing deposits decreased $395.0 million, or 9.9% which resulted in $0.9 million less interest expense. These interest-bearing deposits were almost entirely replaced with an increase in the average balance on noninterest-bearing deposits of $317.4 million, or 27.3%. The Company’s net interest margin increased to 3.11% for the second quarter of 2024 from 2.68% for the second quarter of 2023. Comparing the second quarter of 2024 to the second quarter of 2023, the Company’s interest-earning asset yields increased 102 bps to 5.39% from 4.37%, while the cost of funds repriced at a slower pace resulting in an increase of 60 bps to 2.36% from 1.76% for the same period.
The provision for credit losses was $2.1 million for the three months ended June 30, 2024. The comparable amounts were $0.4 million for the three months ended March 31, 2024, and $0.7 million for the three months ended June 30, 2023. The increase in the provision for credit losses for the second quarter of 2024 compared to the first quarter of 2024 was due to new loan growth, a small increase in the Bank’s CECL model loss factors and increases in specific reserves and charge-offs in the second quarter of 2024. Coverage ratios were 1.24% and 1.23% at June 30, 2024 and March 31, 2024, respectively. The increase in the provision for credit losses when compared to the second quarter of 2023 was primarily due to an updated CECL model in the third quarter of 2023 due to the merger. Net charge-offs for the second quarter of 2024 were $0.9 million compared to net charge-offs of $0.6 million for the first quarter of 2024 and net charge offs of $50,000 for the second quarter of 2023.
At June 30, 2024 and March 31, 2024, nonperforming assets were $18.4 million, or 0.31% of total assets and $16.4 million, or 0.28% of total assets, respectively. The balance of nonperforming assets increased primarily due to an increase in assets held for sale of $1.1 million and an increase of $1.1 million in loans 90 days past due and still accruing. When comparing June 30, 2024 to June 30, 2023, nonperforming assets increased $13.7 million, primarily due to increases in nonaccrual loans of $11.4 million, an increase in repossessed marine loans and assets held for sale of $2.9 million, and an increase of $0.7 million in loans 90 days past due and still accruing almost entirely impacted by the merger in the third quarter of 2023.
Total noninterest income for the second quarter of 2024 was $8.4 million, an increase of $1.9 million from $6.6 million for the first quarter of 2024 and an increase $3.1 million from $5.3 million for the second quarter of 2023. The increase from the first quarter of 2024 was primarily due to improved mortgage banking revenue. In addition, both Wye Financial Partners, the Bank’s wealth management division, and the Mid-Maryland Title Company, Inc. (the “title company”) have experienced improved revenue streams due to increased activity. The increase from the second quarter of 2023 was due to higher revenue among almost all revenue line items, a direct result of the merger in the third quarter of 2023.
Total noninterest expense of $33.5 million for the second quarter of 2024 decreased $3.2 million when compared to the first quarter of 2024 expense of $36.7 million and increased $11.9 million when compared to the second quarter of 2023 expense of $21.6 million. The decrease from the first quarter of 2024 was primarily due to a credit card fraud loss of $4.3 million in the first quarter of 2024, partially offset by an increase in salaries and wages of $1.5 million. The increase from the second quarter of 2023 was primarily due to the operation of a larger branch network and employee base due to the merger, which significantly impacted almost all expense line items. In addition, despite the increased size, the Company has prudently reduced its staff by approximately 72 FTE’s since the consummation of the merger. The efficiency ratio for the second quarter of 2024 when compared to the first quarter of 2024 and the second quarter of 2023 was 66.23%, 76.93% and 77.76%, respectively. Furthermore, Non-GAAP efficiency ratios(1) for the same periods were 61.05%, 62.37% and 71.75%, respectively. The net operating expense ratio,which is non-interest expense less non-interest income divided by average assets, for the second quarter 2024 was 1.73%, compared to 2.10% and 1.82% for the first quarter of 2024 and the second quarter of 2023, respectively. The Non-GAAP net operating expense ratio, which excludes core deposit intangible amortization and non-recurring activity, for the second quarter 2024 was 1.55%, compared to 1.62% and 1.64% for the first quarter of 2024 and the second quarter of 2023, respectively.
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Review of Six Month Financial Results
Net interest income for the first six months of 2024 was $83.3 million, an increase of $35.1 million, or 72.9%, when compared to the first six months of 2023. The increase in net interest income was primarily due to an increase in total interest income of $72.6 million, or 101.2%, which included an increase in interest and fees on loans of $69.5 million, or 109.3%. The increase of interest and fees on loans was primarily due to the increase in the average balance of loans of $2.0 billion, or 75.9%, and an increase in net accretion income of $6.7 million due to the merger. Increases to net interest income were partially offset by increased total interest expense of $37.4 million, or 159.0%, primarily due to increases in the cost of funds and in the average balance of interest-bearing deposits of $1.6 billion, or 76.8%. All of these increases were largely due to the merger.
The Company’s net interest margin increased to 3.09% for 2024 from 2.93% for 2023, primarily due to recent loan growth and repricing of earning assets, higher net accretion due to the merger, a positive shift in lower cost deposits and an overall stabilized funding base. The increase in the average balance and yields earned on average earning assets of $2.1 billion and 100 bps, respectively, were partially offset by increases in the average balance and rates paid on interest-bearing deposits of $1.6 billion and 136 bps, respectively. The average balance on noninterest-bearing deposits increased $522.7 million, or 65.4%. Net accretion income impacted the increased net interest margin by 27 bps and five bps for the six months ended June 30, 2024 and 2023, respectively. Until the balance sheet restructuring in the third quarter of 2024, the net interest margin experienced compression due to the Company’s liability sensitive position, deposit rate pressures and significantly higher FHLB borrowing rates.
The provision for credit losses for the six months ended June 30, 2024 and 2023 was $2.5 million and $1.9 million, respectively. The increase in the provision for credit losses for 2024 was due to higher levels of reserves required by the Company’s CECL model and higher net charge-offs. Net charge offs for the six months ended June 30, 2024 were $1.5 million compared to net recoveries of $70,000 for the six months ended June 30, 2023.
Total noninterest income for the six months ended June 30, 2024 increased $4.4 million or 41.2%, when compared to the same period in 2023. The increase in noninterest income was experienced among almost all revenue line items. These increases were attributable to the increased size and scale of the Company following the merger as well as strategic initiatives to improve business line operations and profitability.
Total noninterest expense for the six months ended June 30, 2024 increased $27.7 million, or 65.2%, when compared to the same period in 2023. Almost all noninterest expense line items increased as a result of the merger and the expanded operations of the newly combined Company. There were no merger-related expenses for the six months ended June 30, 2024, compared to $1.9 million for the six months ended June 30, 2023. The Company continues to focus on streamlining processes to unlock operational efficiencies and reduce overall noninterest expenses.
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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.
For further information contact: Todd Capitani, Executive Vice President, and Chief Financial Officer, 240-427-1068
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Shore Bancshares, Inc.
Financial Highlights (Unaudited)
For the Three Months Ended June 30,For the Six Months Ended June 30,
(Dollars in thousands, except per share data)
20242023 Change20242023Change
PROFITABILITY FOR THE PERIOD
Net interest income$42,140$22,49487.3 %$83,275$48,15872.9 %
Provision for credit losses2,081667212.0 2,4881,88032.3 
Noninterest income8,4405,29459.4 15,00710,62841.2 
Noninterest expense33,49921,60855.0 70,19742,50165.2 
Income before income taxes15,0005,513172.1 25,59714,40577.7 
Income tax expense 3,7661,495151.9 6,1793,93057.2 
Net income$11,234$4,018179.6 $19,418$10,47585.4 
Return on average assets 0.77 %0.45 %32 bp0.67 %0.59 %8 bp
Return on average assets excluding amortization of intangibles, merger related expenses and credit card fraud losses - Non-GAAP (1) (2)
0.91 0.59 32 0.92 0.71 21 
Return on average equity 8.70 4.49 421 7.54 5.83 171 
Return on average tangible equity - Non-GAAP (1), (2)
12.85 7.16 569 13.08 8.57 451 
Interest rate spread2.11 2.04 7 2.23 2.35 (12)
Net interest margin3.11 2.68 43 3.09 2.93 16 
Efficiency ratio - GAAP 66.23 77.76 (1,153)71.42 72.30 (88)
Efficiency ratio - Non-GAAP (1)
61.05 71.76 (1,071)61.69 67.49 (580)
Non-interest income to average assets0.58 0.59 (1)0.52 0.60 (8)
Non-interest expense to average assets2.31 2.41 (10)2.43 2.41 2 
Net operating expense to average assets - GAAP1.73 1.82 (9)1.91 1.81 10 
Net operating expense to average assets - Non-GAAP (1)
1.55 1.64 (9)1.58 1.65 (7)
PER SHARE DATA
Basic and diluted net income per common share$0.34$0.2069.1 %$0.58$0.539.9 %
Dividends paid per common share$0.12$0.12— %$0.24$0.24— %
Book value per common share at period end15.7418.24(13.7)
Tangible book value per common share at period end - Non-GAAP (1)
12.5414.83(15.4)
Market value at period end11.4511.56(1.0)
Market range:
High11.9014.45(17.6)14.3818.15(20.8)
Low10.0610.65(5.5)10.0610.65(5.5)
AVERAGE BALANCE SHEET DATA
Loans$4,706,510$2,709,94473.7 %$4,680,846$2,661,06675.9 %
Investment securities706,079645,8429.3 680,701649,9944.7 
Earning assets5,459,9613,369,18362.1 5,423,8713,324,68263.1 
Assets5,839,3283,596,31162.4 5,807,0763,551,57363.5 
Deposits5,064,9742,908,66274.1 5,103,8152,938,38973.7 
Short-term and Long Term FHLB advances143,769261,797(45.1)73,885188,293(60.8)
Subordinated Debt & TRUPS72,68043,18568.3 72,54943,14768.1 
Stockholders' equity519,478363,22543.0 517,727362,20542.9 
____________________________________
(1)See the reconciliation table that begins on page 23.
(2)This ratio excludes merger related expenses (Non-GAAP) on page 23.
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Shore Bancshares, Inc.
Financial Highlights (Unaudited) - Continued
For the Three Months Ended June 30,For the Six Months Ended June 30,
(Dollars in thousands, except per share data)20242023 Change20242023Change
CREDIT QUALITY DATA
Net charge-offs$886$501,672.0 %$1,451$701972.9 %
Nonaccrual loans $14,837$3,481326.2 %
Loans 90 days past due and still accruing4141,050(60.6)
Other real estate owned and Repossessed Property3,1261791,646.4 
Total nonperforming assets 18,3774,710290.2 
Borrowers experiencing financial difficulty ("BEFDs") (still accruing)——— 
Total nonperforming assets and BEFDs modifications$18,377$4,710290.2 
CAPITAL AND CREDIT QUALITY RATIOS
Period-end equity to assets8.92 %9.97 %(105)bp
Period-end tangible equity to tangible assets - Non-GAAP (1)
7.23 8.26 (103)
Annualized net charge-offs to average loans0.08 %0.01 %7 bp0.06 %0.01 %5 bp
Allowance for credit losses as a percent of:
Period-end loans 1.24 %1.05 %19 bp
Nonaccrual loans 394.14 833.50 (43,936)
Nonperforming assets 318.21 616.01 (29,780)
Accruing BEFDs modifications— — — 
Nonperforming assets and accruing BEFDs318.21 616.01 (29,780)
As a percent of total loans:
Nonaccrual loans 0.32 %0.13 %19 bp
As a percent of total loans, other real estate owned, and repossessed property
Nonperforming assets0.39 %0.17 %22 bp
As a percent of total assets:
Nonaccrual loans 0.25 %0.10 %15 bp
Nonperforming assets 0.31 %0.13 %18 
____________________________________
(1)See the reconciliation table that begins on page 23.
(2)This ratio excludes merger related expenses (Non-GAAP) on page 23.

7

Shore Bancshares, Inc.
Consolidated Balance Sheets (Unaudited)
June 30, 2024June 30, 2024
compared tocompared to
(In thousands, except per share data)June 30, 2024December 31, 2023June 30, 2023December 31, 2023June 30, 2023
ASSETS
Cash and due from banks$50,090$63,172$35,423(20.7)%41.4 %
Interest-bearing deposits with other banks88,793309,24110,404(71.3)753.5 
Cash and cash equivalents138,883372,41345,827(62.7)203.1 
Investment securities available for sale (at fair value)131,594110,52178,06919.1 68.6 
Investment securities held to maturity (net of allowance for credit losses of $108 (June 30, 2024), $94 (December 31, 2023), $163 (June 30, 2023)) at amortized cost)499,431513,188536,970(2.7)(7.0)
Equity securities, at fair value5,6995,7031,245(0.1)357.8 
Restricted securities21,72517,90021,20821.4 2.4 
Loans held for sale, at fair value27,8298,7826,845216.9 306.6 
Loans held for investment4,705,7374,641,0102,753,2231.4 70.9 
Less: allowance for credit losses(58,478)(57,351)(29,014)(2.0)(101.6)
Loans, net4,647,2594,583,6592,724,2091.4 70.6 
Premises and equipment, net82,17682,38651,036(0.3)61.0 
Goodwill63,26663,26663,266— — 
Other intangible assets, net42,94548,0904,671(10.7)819.4 
Other real estate owned, net179179179— — 
Repossessed property, net1,560——— — 
Assets held for sale1,387——— 
Mortgage servicing rights, at fair value5,9955,9265,4661.2 9.7 
Right of use assets, net11,76212,4879,077(5.8)29.6 
Cash surrender value on life insurance102,969101,70460,1501.2 71.2 
Accrued interest receivable19,64119,2178,7782.2 123.8 
Deferred income taxes36,07840,70710,879(11.4)231.6 
Other assets23,63924,79013,756(4.6)71.8 
Total assets$5,864,017$6,010,918$3,641,631(2.4)61.0 
LIABILITIES
Noninterest-bearing deposits$1,587,252$1,258,037$778,96326.2 %103.8 %
Interest-bearing deposits3,561,6334,128,0832,158,563(13.7)65.0 
Total deposits5,148,8855,386,1202,937,526(4.4)75.3 
Advances from FHLB - short-term31,000—276,000— (88.8)
Advances from FHLB - long-term50,000——— — 
Guaranteed preferred beneficial interest in junior subordinated debentures ("TRUPS")29,31629,15818,4920.5 58.5 
Subordinated debt43,50443,13924,7350.8 75.9 
Total borrowings153,82072,297319,227112.8 (51.8)
Lease liabilities12,18912,8579,392(5.2)29.8 
Accrued expenses and other liabilities26,34028,50912,346(7.6)113.3 
Total liabilities$5,341,234$5,499,783$3,278,491(2.9)62.9 
STOCKHOLDERS' EQUITY
Common stock, par value $0.01; authorized 50,000,000 shares$333$332$1990.3 67.3 
Additional paid in capital356,994356,007202,0080.3 76.7 
Retained earnings173,716162,290169,4947.0 2.5 
Accumulated other comprehensive loss(8,260)(7,494)(8,561)(10.2)3.5 
Total stockholders' equity522,783511,135363,1402.3 44.0 
Total liabilities and stockholders' equity$5,864,017$6,010,918$3,641,631(2.4)61.0 
Period-end common shares outstanding$33,215$33,162$19,9070.2 66.8 
Book value per common share$15.74$15.41$18.242.1 (13.7)
8

Shore Bancshares, Inc.
Consolidated Statements of Income (Unaudited)
For the Three Months Ended June 30,For the Six Months Ended June 30,
(In thousands, except per share data)20242023% Change20242023% Change
INTEREST INCOME
Interest and fees on loans $67,292$32,729105.6 %$133,045$63,557109.3 %
Interest on investment securities:
Taxable5,2303,72940.3 9,6507,79323.8 
Tax-exempt 6520.0 1212— 
Interest on deposits with other banks578170240.0 1,538333361.9 
Total interest income$73,106$36,63399.6 $144,245$71,695101.2 
INTEREST EXPENSE
Interest on deposits$27,585$9,914178.2 $56,081$17,195226.1 
Interest on short-term borrowings1,5843,449(54.1)1,6414,810(65.9)
Interest on long-term borrowings1,797776131.6 3,2481,532112.0 
Total interest expense$30,966$14,139119.0 $60,970$23,537159.0 
NET INTEREST INCOME$42,140$22,49487.3 $83,275$48,15872.9 
Provision for credit losses2,081667212.0 2,4881,88032.3 
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES$40,059$21,82783.5 $80,787$46,27874.6 
NONINTEREST INCOME
Service charges on deposit accounts$1,493$1,26418.1 $3,001$2,47721.2 
Trust and investment fee income896399124.6 1,63083196.1 
Interchange credits1,7171,31131.0 3,3042,52331.0 
Mortgage-banking revenue1,9831,05488.1 2,7832,03137.0 
Title Company revenue165186(11.3)243323(24.8)
Other noninterest income2,1861,080102.4 4,0462,44365.6 
Total noninterest income$8,440$5,29459.4 $15,007$10,62841.2 

9

Shore Bancshares, Inc.
Consolidated Statements of Income (Unaudited) - Continued
For the Three Months Ended June 30,For the Six Months Ended June 30,
(In thousands, except per share data)20242023% Change20242023% Change
NONINTEREST EXPENSE
Salaries and wages$13,307$8,95548.6 %$25,158$17,63942.6 %
Employee benefits3,5932,44047.3 7,6895,36143.4 
Occupancy expense 2,4321,59952.1 4,8483,21850.7 
Furniture and equipment expense90047788.7 1,8041,01178.4 
Data processing2,9781,73971.2 5,8453,53765.3 
Directors' fees35918594.1 65443550.3 
Amortization of intangible assets2,569435490.6 5,145876487.3 
FDIC insurance premium expense1,08975843.7 2,2401,12998.4 
Other real estate owned, net——— —(1)100.0 
Legal and professional fees1,35495941.2 2,9541,70972.8 
Fraud losses (1)
624731.9 4,5641143903.5 
Merger related expenses—1,197(100.0)—1,888(100.0)
Other noninterest expenses4,8562,81772.4 9,2965,58566.4 
Total noninterest expense$33,499$21,60855.0 70,19742,50165.2 
Income before income taxes$15,000$5,513172.1 25,59714,40577.7 
Income tax expense 3,7661,495151.9 6,1793,93057.2 
NET INCOME $11,234$4,018179.6 $19,418$10,47585.4 
Weighted average shares outstanding - basic and diluted33,21519,90366.9 33,33719,89567.6 
Basic and diluted net income per common share$0.34$0.2069.1 $0.58$0.539.9 
Dividends paid per common share$0.12$0.12— $0.24$0.24— 
____________________________________
(1)Fraud losses includes $4.3 million of credit card fraud losses for the six months ended June 30, 2024.

10

Shore Bancshares, Inc.
Consolidated Average Balance Sheets (Unaudited)
For the Three Months EndedFor the Three Months Ended
June 30, 2024June 30, 2023June 30, 2024March 31, 2024
(Dollars in thousands)Average BalanceInterestYield/RateAverage BalanceInterestYield/Rate Average BalanceInterestYield/RateAverage BalanceInterestYield/Rate
Earning assets
Loans (1), (2), (3)
Consumer real estate $1,388,168$19,2785.59 %$946,545$10,8764.61 %$1,388,168$19,2785.59 %$1,361,636$18,4925.46 %
Commercial real estate 2,738,69339,3705.78 1,292,40615,6204.85 2,738,69339,3705.78 2,722,60038,6045.70 
Commercial 216,8093,9267.28 137,5542,1776.35 216,8093,9267.28 219,8844,0977.49 
Consumer327,7814,2655.23 323,7983,9834.93 327,7814,2655.23 329,1184,2725.22 
State and political2,331305.18 90083.57 2,331305.18 1,473164.37 
Credit Cards8,3782019.65 ——— 8,3782019.65 7,4571679.01 
Other24,3503024.99 8,7411175.37 24,3503024.99 13,0151835.66 
Total Loans4,706,51067,3725.76 2,709,94432,7814.85 4,706,51067,3725.76 4,655,18365,8315.69 
Investment securities
Taxable705,4215,2302.97 645,1783,7292.31 705,4215,2302.97 654,6634,4192.70 
Tax-exempt (1)
65884.86 66495.42 65884.86 66084.85 
Interest-bearing deposits47,3725784.91 13,3971705.09 47,3725784.91 77,2769605.00 
Total earning assets5,459,96173,1885.39 3,369,18336,6894.37 5,459,96173,1885.39 5,387,78271,2185.32 
Cash and due from banks45,14129,92345,14149,499
Other assets391,854225,935391,854395,023
Allowance for credit losses(57,628)(28,730)(57,628)(57,480)
Total assets$5,839,328$3,596,311$5,839,328$5,774,824
11

For the Three Months EndedFor the Three Months Ended
June 30, 2024June 30, 2023June 30, 2024March 31, 2024
(Dollars in thousands)Average BalanceInterestYield/RateAverage BalanceInterestYield/Rate Average BalanceInterestYield/RateAverage BalanceInterestYield/Rate
Interest-bearing liabilities
Demand deposits$711,138$5,5503.14 %$685,674$3,9132.29 %$711,138$5,5503.14 %$1,110,524$6,3622.30 %
Money market and savings deposits 1,690,15710,2912.45 907,0682,5261.12 1,690,15710,2912.45 1,669,07410,1602.45 
Brokered deposits7,753944.88 ——— 7,753944.88 20,4652514.93 
Certificates of deposit $100,000 or more758,2117,5814.02 312,3672,3373.00 758,2117,5814.02 762,2107,6754.05 
Other time deposits417,3314,0693.92 225,4951,1392.03 417,3314,0693.92 417,3624,0493.90 
Interest-bearing deposits (4)
3,584,59027,5853.10 2,130,6049,9151.87 3,584,59027,5853.10 3,979,63528,4972.88 
Advances from FHLB - short-term113,5491,5845.61 261,7973,4495.28 113,5491,5845.61 4,000565.63 
Advances from FHLB - long-term30,2203464.60 ——— 30,2203464.60 ——— 
Subordinated debt and Guaranteed preferred beneficial interest in junior subordinated debentures ("TRUPS") (4)
72,6801,4518.03 43,1857767.21 72,6801,4518.03 72,4181,4518.06 
Total interest-bearing liabilities3,801,03930,9663.28 2,435,58614,1402.33 3,801,03930,9663.28 4,056,05330,0042.98 
Noninterest-bearing deposits1,480,384778,0581,480,3841,163,023
Accrued expenses and other liabilities38,42719,44238,42739,772
Stockholders' equity519,478363,225519,478515,976
Total liabilities and stockholders' equity$5,839,328$3,596,311$5,839,328$5,774,824
Net interest income$42,222$22,549$42,222$41,214
Net interest spread2.11 %2.04 %2.11 %2.34 %
Net interest margin3.11 %2.68 %3.11 %3.08 %
Cost of Funds2.36 %1.76 %2.36 %2.31 %
Cost of Deposits2.19 %1.37 %2.19 %2.23 %
Cost of Debt6.28 %5.56 %6.28 %7.93 %
____________________________________
(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 $4.5 million, $0.3 million and $4.2 million of accretion interest on loans for the three months ended June 30, 2024 and 2023, and March 31, 2024, 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, $41,000 and $(0.4) 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 June 30, 2024 and 2023, and March 31, 2024, respectively.
12

Shore Bancshares, Inc.
Consolidated Average Balance Sheets (Unaudited)
For the Six Months Ended June 30,
20242023
(Dollars in thousands)Average BalanceInterestYield/RateAverage BalanceInterestYield/Rate
Earning assets
Loans (1), (2), (3)
  Consumer real estate $1,374,902$37,770 5.52 %$914,351$21,383 4.72 %
  Commercial real estate 2,730,64677,974 5.74 1,286,19930,793 4.83 
  Commercial 218,3468,024 7.39 140,1613,997 5.75 
  Consumer328,4508,537 5.23 310,7367,257 4.71 
  State and political1,90246 4.86 93917 3.65 
  Credit Cards7,918368 9.35 —— — 
  Other18,682484 5.21 8,680199 4.62 
Total Loans4,680,846 133,203 5.72 2,661,066 63,646 4.82 
Investment securities
Taxable680,0429,650 2.84 649,3297,793 2.40 
Tax-exempt (1)
65915 4.55 66515 4.51 
Interest-bearing deposits62,3241,538 4.96 13,622333 4.93 
Total earning assets5,423,871144,406 5.35 3,324,68271,787 4.35 
Cash and due from banks47,32029,266
Other assets393,439226,989
Allowance for credit losses(57,554)(29,364)
Total assets$5,807,076 $3,551,573 
Interest-bearing liabilities
Demand deposits$910,831$11,911 2.63 %$690,258$7,149 2.09 %
Money market and savings deposits 1,679,61520,451 2.45 955,5414,899 1.03 
Brokered deposits14,107345 4.92 —— — 
Certificates of deposit $100,000 or more760,21115,256 4.04 277,0963,413 2.48 
Other time deposits417,3468,118 3.91 216,5001,734 1.62 
Interest-bearing deposits (4)
3,782,11056,081 2.98 2,139,39517,195 1.62 
Advances from FHLB - short-term58,7751,641 5.61 188,2934,810 5.15 
Advances from FHLB - long-term15,110346 4.60 —— — 
Subordinated debt and Guaranteed preferred beneficial interest in junior subordinated debentures ("TRUPS") (4)
72,5492,902 8.04 43,1471,532 7.16 
Total interest-bearing liabilities3,928,54460,970 3.12 2,370,83523,537 2.00 
Noninterest-bearing deposits1,321,705798,994
Accrued expenses and other liabilities39,10019,539
Stockholders' equity517,727 362,205 
Total liabilities and stockholders' equity$5,807,076 $3,551,573 
Net interest income$83,436 $48,250 
Net interest spread2.23 %2.35 %
Net interest margin3.09 %2.93 %
Cost of Funds2.34 %1.50 %
Cost of Deposits2.21 %1.18 %
Cost of Debt6.71 %5.53 %
____________________________________
(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 $8.7 million and $0.7 million of accretion interest on loans for the six months ended June 30, 2024 and 2023, respectively.
(4) Interest expense on deposits and borrowing includes amortization of deposit premiums and amortization of borrowing fair value adjustment. There were $(0.8) million of amortization of deposit discounts and $0.2 million of amortization of deposit premium, and $(0.5) million and $(0.1) million of amortization of borrowing fair value adjustment for the six months ended June 30, 2024 and 2023, respectively.
13

Shore Bancshares, Inc.
Financial Highlights By Quarter (Unaudited)
2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter6/30/20246/30/2024
20242024202320232023compared tocompared to
(Dollars in thousands, except per share data)Q2 2024Q1 2024Q4 2023Q3 2023Q2 2023Q1 2024Q2 2023
PROFITABILITY FOR THE PERIOD
Taxable-equivalent net interest income$42,222$41,214$41,606$45,702$22,5452.5 %87.3 %
Less: Taxable-equivalent adjustment82798180513.8 60.8 
Net interest income42,14041,13541,52545,62222,4942.4 87.3 
Provision for credit losses2,08140789628,176667411.3 212.0 
Noninterest income8,4406,5677,54814,9845,29428.5 59.4 
Noninterest expense33,49936,69833,67047,15821,608(8.7)55.0 
Income/(loss) before income taxes15,00010,59714,507(14,728)5,51341.6 172.1 
Income tax expense/ (benefit)3,7662,4134,017(4,991)1,49556.1 151.9 
Net income/ (loss) $11,234$8,184$10,490$(9,737)$4,01837.3 179.6 
Return on average assets 0.77%0.57%0.72%(0.67)%0.45%20 bp32 bp
Return on average assets excluding amortization of intangibles, fraud losses and merger related expenses - Non-GAAP (1), (2)
0.910.940.880.010.59(3)32 
Return on average equity 8.706.388.21(7.25)4.49232 421 
Return on average tangible equity - Non-GAAP (1), (2)
12.8513.3912.881.747.16(54)569 
Net interest margin3.113.083.093.352.683 43 
Efficiency ratio - GAAP 66.2376.9368.6177.8177.76(1,070)(1,153)
Efficiency ratio - Non-GAAP (1)
61.0562.3761.9947.1971.75(132)(1,070)
PER SHARE DATA
Basic and diluted net income/(loss) per common share$0.34$0.25$0.32$(0.29)$0.2035.3 %69.1 %
Dividends paid per common share0.120.120.120.120.12— — 
Book value per common share at period end15.7415.5115.4115.1418.241.5 (13.7)
Tangible book value per common share at period end - Non-GAAP (1)
12.5412.2412.0611.7014.832.5 (15.4)
Market value at period end11.4511.5014.2510.5211.56(0.4)(1.0)
Market range:
High11.9014.3814.5113.3714.45(17.3)(17.7)
Low10.0610.569.6610.2710.65(4.7)(5.5)
____________________________________
(1)See the reconciliation table (Non-GAAP) that begins on page 23.
(2)This ratio excludes merger related expenses (Non-GAAP) on page 23.

14

Shore Bancshares, Inc.
Financial Highlights By Quarter (Unaudited) - Continued
2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter6/30/20246/30/2024
20242024202320232023compared tocompared to
(Dollars in thousands, except per share data)Q2 2024Q1 2024Q4 2023Q3 2023Q2 2023Q1 2024Q2 2023
AVERAGE BALANCE SHEET DATA
Loans$4,706,510$4,655,183$4,639,467$4,562,748$2,709,9441.10 %73.68 %
Investment securities706,079655,323619,920778,744645,8427.75 9.33 
Earning assets5,459,9615,387,7825,339,8335,404,5723,369,1831.34 62.06 
Assets5,839,3285,774,8245,745,4405,769,3123,596,3111.12 62.37 
Deposits5,064,9745,142,6585,136,8185,066,8862,908,662(1.51)74.13 
Short-term and Long Term FHLB advances143,7694,0001,14170,348261,7973494.23 (45.08)
Subordinated Debt & TRUPS72,68072,41872,15571,90743,1850.36 68.30 
Stockholders' equity519,478515,976507,040533,114363,2250.68 43.02 
CREDIT QUALITY DATA
Net charge offs $886$565$500$1,449$5056.81 %1,672.00 %
Nonaccrual loans $14,837$12,776$12,784$8,982$3,48116.13 %326.23 %
Loans 90 days past due and still accruing4141,5607382,1491,065(73.46)(61.13)
Other real estate owned and repossessed property3,1262,02417917917954.45 1,646.37 
Total nonperforming assets $18,377$16,360$13,701$11,310$4,72512.33 288.93 

15

Shore Bancshares, Inc.
Financial Highlights By Quarter (Unaudited) - Continued
2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter6/30/20246/30/2024
20242024202320232023compared tocompared to
(Dollars in thousands, except per share data)Q2 2024Q1 2024Q4 2023Q3 2023Q2 2023Q1 2024Q2 2023
CAPITAL AND CREDIT QUALITY RATIOS
Period-end equity to assets8.92 %8.84 %8.50 %8.79 %9.97 %8 bp(105)bp
Period-end tangible equity to tangible assets - Non-GAAP (1)
7.23 7.11 6.78 6.93 8.26 12 (103)
Annualized net charge-offs to average loans0.08 %0.05 %0.04 %0.13 %0.01 %3 bp7 bp
Allowance for credit losses as a percent of:
Period-end loans (3)
1.24 %1.23 %1.24 %1.24 %1.05 %1 bp19 bp
Period-end loans (4)
1.24 1.23 1.24 1.24 1.05 1 19 
Nonaccrual loans 394.14 448.78 448.62 635.17 833.50 (5,464)(43,936)
Nonperforming assets 318.21 350.46 418.59 504.43 614.05 (3,225)(29,584)
As a percent of total loans:
Nonaccrual loans 0.32 %0.27 %0.28 %0.19 %0.13 %5 bp19 bp
As a percent of total loans, other real estate owned, and repossessed property
Nonperforming assets 0.39 %0.35 %0.30 %0.24 %0.17 %4 bp22 bp
As a percent of total assets:
Nonaccrual loans 0.25 %0.22 %0.21 %0.16 %0.10 %3 bp15 bp
Nonperforming assets 0.31 0.28 0.23 0.20 0.13 3 18 
____________________________________
(1)See the reconciliation table (Non-GAAP) that begins on page 23.
(2)This ratio excludes merger related expenses (Non-GAAP) on page 23.
(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.
16

Shore Bancshares, Inc.
Consolidated Balance Sheets (Unaudited)
June 30, 2024June 30, 2024
compared tocompared to
(In thousands, except per share data)June 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023December 31, 2023June 30, 2023
ASSETS
Cash and due from banks$50,090 $43,079 $63,172 $68,097 $35,423 (20.7)%41.4 %
Interest-bearing deposits with other banks88,793 71,481 309,241 40,612 10,404 (71.3)753.5 
Cash and cash equivalents138,883 114,560 372,413 108,709 45,827 (62.7)203.1 
Investment securities available for sale (at fair value)131,594 179,496 110,521 79,143 78,069 19.1 68.6 
Investment securities held to maturity (net of allowance for credit losses of $108 (June 30, 2024), $116 (March 31, 2024), $94 (December 31,2023), $126 (September 30, 2023), and $163 (June 30, 2023)) at amortized cost)499,431 503,822 513,188 523,051 536,970 (2.7)(7.0)
Equity securities, at fair value5,699 5,681 5,703 5,434 1,245 (0.1)357.8 
Restricted securities21,725 17,863 17,900 13,361 21,208 21.4 2.4 
Loans held for sale, at fair value27,829 13,767 8,782 14,725 6,845 216.9 306.6 
Loans held for investment4,705,737 4,648,725 4,641,010 4,617,719 2,753,223 1.4 70.9 
Less: allowance for credit losses(58,478)(57,336)(57,351)(57,051)(29,014)(2.0)(101.6)
Loans, net4,647,259 4,591,389 4,583,659 4,560,668 2,724,209 1.4 70.6 
Premises and equipment, net82,176 83,084 82,386 81,149 51,036 (0.3)61.0 
Goodwill63,266 63,266 63,266 63,266 63,266 — — 
Other intangible assets, net42,945 45,515 48,090 50,685 4,671 (10.7)819.4 
Other real estate owned, net179 179 179 179 179 — — 
Repossessed property, net1,560 1,845 — — — — — 
Assets held for sale1,387 — — — — — — 
Mortgage servicing rights, at fair value5,995 5,821 5,926 5,890 5,466 1.2 9.7 
Right of use assets, net11,762 12,153 12,487 12,741 9,077 (5.8)29.6 
Cash surrender value on life insurance102,969 102,321 101,704 100,950 60,150 1.2 71.2 
Accrued interest receivable19,641 19,541 19,217 15,683 8,778 2.2 123.8 
Deferred income taxes36,078 38,978 40,707 45,346 10,879 (11.4)231.6 
Other assets23,639 26,423 24,790 24,392 13,756 (4.6)71.8 
Total assets$5,864,017 $5,825,704 $6,010,918 $5,705,372 $3,641,631 (2.4)61.0 

17

Shore Bancshares, Inc.
Consolidated Balance Sheets (Unaudited) - Continued
June 30, 2024June 30, 2024
compared tocompared to
(In thousands, except per share data)June 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023December 31, 2023June 30, 2023
LIABILITIES
Noninterest-bearing deposits$1,587,252 $1,200,680 $1,258,037 $1,211,401 $778,963 26.2 %103.8 
Interest-bearing deposits3,561,633 3,983,599 4,128,083 3,897,343 2,158,563 (13.7)65.0 
Total deposits5,148,885 5,184,279 5,386,120 5,108,744 2,937,526 (4.4)75.3 
Advances from FHLB - short-term31,000 — — — 276,000 — (88.8)
Advances from FHLB - long-term50,000 — — — — — — 
Guaranteed preferred beneficial interest in junior subordinated debentures ("TRUPS")29,316 29,237 29,158 29,079 18,492 0.5 58.5 
Subordinated debt43,504 43,322 43,139 42,956 24,735 0.8 75.9 
Total borrowings153,820 72,559 72,297 72,035 319,227 112.8 (51.8)
Lease liabilities12,189 12,552 12,857 13,082 9,392 (5.3)29.8 
Accrued expenses and other liabilities26,340 41,086 28,509 9,933 12,346 (5.3)113.3 
Total liabilities5,341,234 5,310,476 5,499,783 5,203,794 3,278,491 (3.0)62.9 
STOCKHOLDERS' EQUITY
Common stock, par value $0.01; authorized 50,000,000 shares333 332 332 331 199 0.3 67.3 
Additional paid in capital356,994 356,464 356,007 355,575 202,008 0.3 76.7 
Retained earnings173,716 166,490 162,290 155,781 169,494 6.9 2.5 
Accumulated other comprehensive loss(8,260)(8,058)(7,494)(10,109)(8,561)(9.5)3.5 
Total stockholders' equity522,783 515,228 511,135 501,578 363,140 2.3 44.0 
— 
Total liabilities and stockholders' equity$5,864,017 $5,825,704 $6,010,918 $5,705,372 $3,641,631 (2.5)61.0 
Period-end common shares outstanding33,21533,211 33,162 33,136 19,907 0.2 66.8 
Book value per common share$15.74 $15.51 $15.41 $15.14 $18.24 2.1 (13.7)
18

Shore Bancshares, Inc.
Consolidated Statements of Income By Quarter (Unaudited)
6/30/20246/30/2024
compared tocompared to
(In thousands, except per share data)Q2 2024Q1 2024Q4 2023Q3 2023Q2 2023Q1 2024Q2 2023
INTEREST INCOME
Interest and fees on loans $67,292$65,754$65,914$64,869$32,7292.3 %105.6 %
Interest on investment securities:
Taxable5,2304,4193,9925,0473,72918.4 40.3 
Tax-exempt666275— 20.0 
Interest on federal funds sold———92—— — 
Interest on deposits with other banks5789601,2241,213170(39.8)240.0 
Total interest income73,10671,13971,13671,24836,6332.8 99.6 
INTEREST EXPENSE
Interest on deposits27,58528,49728,13323,4739,914(3.2)178.2 
Interest on short-term borrowings1,58456166923,4492728.6 (54.1)
Interest on long-term borrowings1,7971,4511,4621,46177623.9 131.6 
Total interest expense30,96630,00429,61125,62614,1393.2 119.0 
NET INTEREST INCOME42,14041,13541,52545,62222,4942.4 87.3 
Provision for credit losses2,08140789628,176667411.3 212.0 
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES40,05940,72840,62917,44621,827(1.6)83.5 
NONINTEREST INCOME
Service charges on deposit accounts1,4931,5071,5191,5051,264(0.9)18.1 
Trust and investment fee income8967348441,93339922.1 124.6 
Loss on sales and calls of investment securities———(2,166)—— — 
Interchange credits1,7171,5871,6331,5571,3118.2 31.0 
Mortgage-banking revenue1,9838011,1051,3771,054147.6 88.1 
Title Company revenue1657813989186111.5 (11.3)
Bargain purchase gain———8,816—— — 
Other noninterest income2,1861,8602,3081,8731,08017.5 102.4 
Total noninterest income$8,440$6,567$7,548$14,984$5,29428.5 59.4 

19

Shore Bancshares, Inc.
Consolidated Statements of Income By Quarter (Unaudited) - Continued
6/30/20246/30/2024
compared tocompared to
(In thousands, except per share data)Q2 2024Q1 2024Q4 2023Q3 2023Q2 2023Q1 2024Q2 2023
NONINTEREST EXPENSE
Salaries and wages$13,307$11,852$12,823$14,183$8,95512.3 %48.6 %
Employee benefits3,5934,0973,3893,6072,440(12.3)47.3 
Occupancy expense 2,4322,4162,3282,2451,5990.7 52.1 
Furniture and equipment expense900904790750477(0.4)88.7 
Data processing2,9782,8672,7622,4851,7393.9 71.3 
Directors' fees35929542629518521.7 94.1 
Amortization of intangible assets2,5692,5762,5952,634435(0.3)490.6 
FDIC insurance premium expense1,0891,1501,733618758(5.3)43.7 
Other real estate owned expenses, net———2—— — 
Legal and professional fees1,3541,5991,4111,217959(15.3)41.2 
Fraud losses (1)
624,50250326247(98.6)31.9 
Merger related expenses——60214,8661,197— (100.0)
Other noninterest expenses4,8564,4404,3083,9942,8179.4 72.4 
Total noninterest expense33,49936,69833,67047,15821,608(8.7)55.0 
Income/(loss) before income taxes15,00010,59714,507(14,728)5,51341.6 172.1 
Income tax expense/(benefit) 3,7662,4134,017(4,991)1,49556.1 151.9 
NET INCOME/(LOSS)$11,234$8,184$10,490$(9,737)$4,01837.3 179.6 
Weighted average shares outstanding - basic and diluted33,21533,33733,32233,24619,903(0.4)66.9 
Basic and diluted net income/(loss) per common share$0.34$0.25$0.32$(0.29)$0.2035.3 69.1 
Dividends paid per common share0.120.120.120.120.12— — 
____________________________________
(1)Fraud losses includes $4.3 million of credit card fraud losses for the quarter ended March 31, 2024.
20

Shore Bancshares, Inc.
Consolidated Average Balance Sheets By Quarter (Unaudited)
Q2 2024Q1 2024Q4 2023Q3 2023Q2 2023
(Dollars in thousands)Average BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/Rate
Earning assets
Loans (1), (2), (3)
Consumer real estate $1,388,168$19,2785.59 %$1,361,636$18,4925.46 %$1,331,150$18,6535.56 %$1,141,707$14,5485.06 %$946,545$10,8764.61 %
Commercial real estate 2,738,69339,3705.78 2,722,60038,6045.70 2,728,09438,7305.63 2,831,56940,5365.68 1,292,40615,6204.85 
Commercial 216,8093,9267.28 219,8844,0977.49 221,3424,2957.70 233,7565,3159.02 137,5542,1776.35 
Consumer327,7814,2655.23 329,1184,2725.22 333,8073,8594.59 332,4864,1834.99 323,7983,9834.93 
State and political2,331305.18 1,473164.37 1,290134.00 929104.27 90083.57 
Credit Cards8,3782019.65 7,4571679.01 6,32016610.42 6,1641499.59 ——— 
Other24,3503024.99 13,0151835.66 17,4642776.29 16,1372014.94 8,7411165.32 
Total Loans4,706,51067,3725.76 4,655,18365,8315.69 4,639,46765,9935.64 4,562,74864,9425.65 2,709,94432,7804.85 
Investment securities
Taxable705,4215,2302.97 654,6634,4192.70 619,2593,9922.58 778,0815,0472.59 645,1783,7292.31 
Tax-exempt (1)
65884.86 66084.85 66184.84 6633420.51 66463.61 
Federal funds sold——— ——— ——— 7,533924.85 ——— 
Interest-bearing deposits47,3725784.91 77,2769605.00 80,4461,2246.04 55,5471,2138.66 13,3971705.09 
Total earning assets5,459,96173,1885.39 5,387,78271,2185.32 5,339,83371,2175.29 5,404,57271,3285.24 3,369,18336,6854.37 
Cash and due from banks45,14149,49963,50651,71429,923
Other assets391,854395,023399,409359,726225,935
Allowance for credit losses(57,628)(57,480)(57,308)(46,700)(28,730)
Total assets$5,839,328$5,774,824$5,745,440$5,769,312$3,596,311
21

Q2 2024Q1 2024Q4 2023Q3 2023Q2 2023
(Dollars in thousands)Average BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/Rate
Interest-bearing liabilities
Demand deposits$711,138$5,5503.14 %$1,110,524$6,3622.30 %$1,117,117$6,6732.37 %$1,056,956$6,6592.50 %$685,674$3,9132.29 %
Money market and savings deposits 1,690,15710,2912.45 1,669,07410,1602.45 1,605,9308,3302.06 1,572,9206,8101.72 907,0682,5261.12 
Brokered deposits7,753944.88 20,4652514.93 92,8401,3475.76 98,6491,2254.93 ——— 
Certificates of deposit $100,000 or more758,2117,5814.02 762,2107,6754.05 701,0516,8983.90 706,6426,2723.52 312,3672,3373.00 
Other time deposits417,3314,0693.92 417,3624,0493.90 391,8204,8854.95 285,7432,5073.48 225,4951,1382.02 
Interest-bearing deposits (4)
3,584,59027,5853.10 3,979,63528,4972.88 3,908,75828,1332.86 3,720,91023,4732.50 2,130,6049,9141.87 
Advances from FHLB - short-term113,5491,5845.61 4,000565.63 1,141165.56 70,3486923.90 261,7973,4495.28 
Advances from FHLB - long-term30,2203464.60 ——— ——— ——— ——— 
Subordinated debt and Guaranteed preferred beneficial interest in junior subordinated debentures ("TRUPS") (4)
72,6801,4518.03 72,4181,4518.06 72,1551,4628.04 71,9071,4618.06 43,1857767.21 
Total interest-bearing liabilities3,801,03930,9663.28 4,056,05330,0042.98 3,982,05429,6112.95 3,863,16525,6262.63 2,435,58614,1392.33 
Noninterest-bearing deposits1,480,3841,163,0231,228,0601,345,976778,058
Accrued expenses and other liabilities38,42739,77228,28627,05719,442
Stockholders' equity519,478515,976507,040533,114363,225
Total liabilities and stockholders' equity$5,839,328$5,774,824$5,745,440$5,769,312$3,596,311
Net interest income$42,222$41,214$41,606$45,702$22,546
Net interest spread2.11 %2.34 %2.34 %2.61 %2.04 %
Net interest margin3.11 %3.08 %3.09 %3.35 %2.68 %
Cost of Funds2.36 %2.31 %2.25 %1.95 %1.76 %
Cost of Deposits2.19 %2.23 %2.17 %1.84 %1.37 %
Cost of Debt6.28 %7.93 %8.00 %6.00 %5.56 %
____________________________________
(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 $4.5 million, $4.2 million, $4.8 million, $6.1 million and $0.3 million of accretion interest on loans for the three months ended June 30, 2024, March 31, 2024, December 31, 2023, September 30, 2023, and June 30, 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, $(0.4) million, $(1.5) million, $(0.5) million and $41,000 of amortization of deposits premium, and $(0.2) million, $(0.2) million, $(0.2) million, $(0.2) million and $(47,000) of amortization of borrowing fair value adjustment for the three months ended June 30, 2024, March 31, 2024, December 31, 2023, September 30, 2023, and June 30, 2023, respectively.
22

Shore Bancshares, Inc.
Reconciliation of Generally Accepted Accounting Principles (GAAP) and Non-GAAP Measures (Unaudited)
YTDYTD
(In thousands, except per share data)Q2 2024Q1 2024Q4 2023Q3 2023Q2 20236/30/20246/30/2023
The following reconciles return on average assets, average equity and return on average tangible equity (Note 1):
Net income (loss) $11,234 $8,184 $10,490 $(9,737)$4,018 $19,418 $10,475 
Net income (loss) - annualized (A)$45,183 $32,916 $41,618 $(38,632)$16,295 $39,049 $21,124 
Net income (loss) $11,234 $8,184 $10,490 $(9,737)$4,018 $19,418 $10,475 
Add: Amortization of intangible assets, net of tax1,924 1,989 1,876 1,741 317 3,903 637 
Add: Merger Expenses, net of tax— — 435 9,828 872 — 1,373 
Add: Credit Card Fraud Losses, net of tax— 3,339 — — — 3,279 — 
Net income, excluding net amortization of intangible assets, merger related expenses and credit card fraud losses13,158 13,512 12,801 1,832 5,207 26,600 12,485 
Net income, excluding net amortization of intangible assets, merger related expenses and credit card fraud losses - annualized (B)$52,921 $54,345 $50,787 $7,268 $21,121 $53,492 $25,177 
Return on average assets (GAAP)0.77 %0.57 %0.72 %(0.67)%0.45 %0.67 %0.59 %
Return on average assets excluding net amortization of intangible assets, merger related expenses and credit card fraud losses - (Non-GAAP)0.91 %0.94 %0.88 %0.01 %0.59 %0.92 %0.71 %
Average assets$5,839,328 $5,774,824 $5,745,440 $5,769,312 $3,596,311 $5,807,076 $3,551,573 
Average stockholders' equity (C)$519,478 $515,976 $507,040 $533,114 $363,225 $517,727 $362,205 
Less: Average goodwill and core deposit intangible(107,594)(110,167)(112,752)(115,604)(68,172)(108,881)(68,388)
Average tangible equity (D)$411,884 $405,809 $394,288 $417,510 $295,053 $408,846 $293,817 
Return on average equity (GAAP) (A)/(C)8.70 %6.38 %8.21 %(7.25)%4.49 %7.54 %5.83 %
Return on average tangible equity (Non-GAAP) (B)/(D)12.85 %13.39 %12.88 %1.74 %7.16 %13.08 %8.57 %
23

Shore Bancshares, Inc.
Reconciliation of Generally Accepted Accounting Principles (GAAP) and Non-GAAP Measures (Unaudited) - Continued
YTDYTD
(In thousands, except per share data)Q2 2024Q1 2024Q4 2023Q3 2023Q2 20236/30/20246/30/2023
The following reconciles GAAP efficiency ratio and non-GAAP efficiency ratio (Note 2):
Noninterest expense (E)$33,499 $36,698 $33,670 $47,158 $21,608 $70,197 $42,501 
Less: Amortization of intangible assets(2,569)(2,576)(2,595)(2,634)(435)(5,145)(876)
Less: Merger Expenses— — (602)(14,866)(1,197)— (1,888)
Less: Credit Card Fraud Losses— (4,323)— — — (4,323)— 
Adjusted noninterest expense (F)$30,930 $29,799 $30,473 $29,658 $19,976 $60,729 $39,737 
Net interest income (G)$42,140 $41,135 $41,525 $45,622 $22,494 $83,275 $48,158 
Add: Taxable-equivalent adjustment82 79 81 80 51 161 92 
Taxable-equivalent net interest income (H)$42,222 $41,214 $41,606 $45,702 $22,545 $83,436 $48,250 
Noninterest income (I)$8,440 $6,567 $7,548 $14,984 $5,294 $15,007 $10,628 
Investment securities losses (gains)— — — 2,166 — — — 
Less: Bargain purchase gain— — — (8,816)— — — 
Adjusted noninterest income (J)$8,440 $6,567 $7,548 $8,334 $5,294 $15,007 $10,628 
Efficiency ratio (GAAP) (E)/(G)+(I) 66.23 %76.93 %68.61 %77.81 %77.76 %71.42 %72.30 %
Efficiency ratio (Non-GAAP) (F)/(H)+(J)61.05 %62.37 %61.99 %54.89 %71.76 %61.69 %67.49 %
Net operating expense to average assets (GAAP)1.73 %2.10 %1.80 %2.21 %1.82 %1.91 %1.81 %
Net operating expense to average assets (Non-GAAP)1.55 %1.62 %1.58 %1.47 %1.64 %1.58 %1.65 %
24

Shore Bancshares, Inc.
Reconciliation of Generally Accepted Accounting Principles (GAAP) and Non-GAAP Measures (Unaudited) - Continued
(In thousands, except per share data)Q2 2024Q1 2024Q4 2023Q3 2023Q2 2023
The following reconciles book value per common share and tangible book value per common share (Note 1):
Stockholders' equity (K)$522,783 $515,228 $511,135 $501,578 $363,140 
Less: Goodwill and core deposit intangible(106,211)(108,781)(111,356)(113,951)(67,937)
Tangible equity (L)$416,572 $406,447 $399,779 $387,627 $295,203 
Shares outstanding (M)33,21533,21133,16233,13619,907
Book value per common share (GAAP) (K)/(M)$15.74$15.51$15.41$15.14$18.24
Tangible book value per common share (Non-GAAP) (L)/(M)$12.54$12.24$12.06$11.70$14.83
The following reconciles equity to assets and tangible equity to tangible assets (Note 1):
Stockholders' equity (N)$522,783$515,228$511,135$501,578$363,140
Less: Goodwill and core deposit intangible(106,211)(108,781)(111,356)(113,951)(67,937)
Tangible equity (O)$416,572$406,447$399,779$387,627$295,203
Assets (P)$5,864,017$5,825,704$6,010,918$5,705,372$3,641,631
Less: Goodwill and core deposit intangible(106,211)(108,781)(111,356)(113,951)(67,937)
Tangible assets (Q)$5,757,806$5,716,923$5,899,562$5,591,421$3,573,694
Period-end equity/assets (GAAP) (N)/(P)8.92%8.84%8.50%8.79%9.97%
Period-end tangible equity/tangible assets (Non-GAAP) (O)/(Q)7.23%7.11%6.78%6.93%8.26%
____________________________________
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.
25

Shore Bancshares, Inc.
Summary of Loan Portfolio (Unaudited)
Portfolio loans are summarized by loan type as follows:
(Dollars in thousands)June 30, 2024%March 31, 2024%December 31, 2023%September 30, 2023%June 30, 2023%
Portfolio Loans by Loan Type
Construction$327,875 6.97 %$299,133 6.43 %$299,000 6.44 %$328,750 7.12 %$220,228 8.00 %
Residential real estate1,539,590 32.72 %1,515,134 32.59 %1,490,438 32.11 %1,439,464 31.17 %938,151 34.07 %
Commercial real estate2,287,497 48.60 %2,272,867 48.90 %2,286,154 49.27 %2,283,521 49.45 %1,130,346 41.06 %
Commercial218,987 4.65 %229,594 4.94 %229,939 4.95 %229,474 4.97 %138,459 5.03 %
Consumer324,480 6.90 %325,076 6.99 %328,896 7.09 %330,411 7.16 %326,039 11.84 %
Credit Cards7,308 0.16 %6,921 0.15 %6,583 0.14 %6,099 0.13 %— — %
Total loans4,705,737 100.00 %4,648,725 100.00 %4,641,010 100.00 %4,617,719 100.00 %2,753,223 100.00 %
Less: Allowance for credit losses(58,478)(57,336)(57,351)(57,051)(29,014)
Total loans, net$4,647,259 $4,591,389 $4,583,659 $4,560,668 $2,724,209 

26

Shore Bancshares, Inc.
Classified Assets and Nonperforming Loans (Unaudited)
Classified loans and nonperforming loans are summarized as follows:
(dollars in thousands)June 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023
Classified Loans
Substandard$17,409 $13,403 $14,673 $10,888 $13,108 
Doubtful— — — — — 
Loss— — — — — 
Total Classified Loans$17,409 $13,403 $14,673 $10,888 $13,108 
Special Mention Loans25,549 27,192 28,264 24,931 11,405 
Total Classified and Special Mention Loans$42,958 $40,595 $42,937 $35,819 $24,513 
Classified Loans$17,409 $13,403 $14,673 $10,888 $13,108 
Other Real Estate Owned3,126 2,024 179 179 179 
Classified Securities— — — — — 
Total Classified Assets$20,535 $15,427 $14,852 $11,067 $13,287 
Non-accrual Loans$14,837 $12,776 $12,784 $8,982 $3,481 
90+ Days Delinquent Accruing414 1,560 738 2,149 1,050 
Accruing BEFDs Loans ("BEFDs")— — — — — 
Other Real Estate Owned ("OREO")3,126 2,024 179 179 179 
Total Nonperforming Loans$18,377 $16,360 $13,701 $11,310 $4,710 

27

Shore Bancshares, Inc.
Summary of Deposits (Unaudited)
June 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023
(dollars in thousands)Balance%Balance%Balance%Balance%Balance%
Noninterest-bearing demand$1,587,252 30.83 %$1,200,680 23.15 %$1,258,037 23.36 %$1,211,401 23.70 %$778,963 26.52 %
Interest-bearing:
Demand658,512 12.79 %1,101,954 21.26 %1,165,546 21.64 %1,210,051 23.69 %694,221 23.63 %
Money market deposits1,337,274 25.97 %1,358,205 26.20 %1,430,603 26.56 %1,179,049 23.08 %600,724 20.45 %
Savings352,069 6.84 %354,098 6.83 %347,324 6.45 %371,755 7.28 %270,884 9.22 %
Certificates of deposit1,213,778 23.57 %1,169,342 22.56 %1,184,610 21.99 %1,136,488 22.25 %592,734 20.18 %
Total interest-bearing3,561,633 69.17 %3,983,599 76.85 %4,128,083 76.64 %3,897,343 76.30 %2,158,563 73.48 %
Total Deposits$5,148,885 100.00 %$5,184,279 100.00 %$5,386,120 100.00 %$5,108,744 100.00 %$2,937,526 100.00 %
28
v3.24.2
Cover
Jul. 25, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jul. 25, 2024
Entity Registrant Name SHORE BANCSHARES, INC.
Entity Incorporation, State or Country Code MD
Entity File Number 000-22345
Entity Tax Identification Number 52-1974638
Entity Address, Address Line One 18 E. Dover St.
Entity Address, City or Town Easton
Entity Address, State or Province MD
Entity Address, Postal Zip Code 21601
City Area Code 410
Local Phone Number 763-7800
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common stock, par value $.01 per share
Trading Symbol SHBI
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0001035092
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