0001035092false00010350922024-10-242024-10-24

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): October 24, 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 October 24, 2024, Shore Bancshares, Inc. (the “Company”) issued a press release announcing its results of operations and financial condition for the three and nine months ended September 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.
2

EXHIBIT INDEX
Exhibit Number
Description
104
Cover Page Interactive Data File (embedded within the inline XBRL document)
3

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: October 24, 2024
By:/s/ James M. Burke
James M. Burke
President and Chief Executive Officer
4

shore_bancsharesxlogo.jpg
18 E. Dover Street
Easton, Maryland 21601
Phone 410-763-7800
PRESS RELEASE
Shore Bancshares, Inc. Reports Three and Nine Months Financial Results
Easton, Maryland (October 24, 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 third quarter of 2024 of $11.2 million or $0.34 per diluted common share which was equal to the second quarter of 2024. The Company’s had a net loss of $9.7 million or $(0.29) per diluted common share for the third quarter of 2023 as a result of the merger of equals on July 1, 2023 between the Company and The Community Financial Corporation. Net income for the first nine months of 2024 was $30.6 million or $0.92 per diluted common share, compared to the first nine months of 2023 of $0.7 million or $0.03 per diluted common share.
Third Quarter and Nine-Months Ended September 30, 2024 Highlights
■Steady Return on Average Assets (“ROAA”) - The Company reported ROAA of 0.77% for the third quarter of 2024, which was equal to reported ROAA for the second quarter of 2024. Non-GAAP, ROAA(1) was 0.90% for the third quarter of 2024, compared to 0.91% for the second quarter of 2024.
■Increased Net Interest Income and Net Interest Margin - Third quarter 2024 net interest income increased $1.1 million to $43.3 million from $42.1 million in the second quarter of 2024. Net interest income increased due to modest loan growth, slightly higher accelerated accretion income, and loans and securities repricing at a faster pace than the Bank’s cost of funds. Net interest margin (“NIM”) increased six basis points (“bps”) to 3.17% for the third quarter of 2024 from 3.11% for the second quarter of 2024. Excluding net accretion interest income of $4.5 million and $3.8 million for the same time periods, NIM increased one bps to 2.84% for the third quarter of 2024 from 2.83% for the second quarter of 2024.
■Asset Quality Remains Strong - Allowance for credit losses (“ACL”) was $58.7 million at September 30, 2024 compared to $58.5 million at June 30, 2024. The third quarter of 2024 ACL as a percentage of loans remained stable at 1.24% from the second quarter of 2024. Nonperforming assets to total assets were 0.27% for the third quarter of 2024 compared to 0.29% for the second quarter of 2024 and 0.23% for the fourth quarter of 2023. Classified assets to total assets increased to 0.39% in the third quarter of 2024 compared to 0.33% for the second quarter of 2024 and 0.25% for the fourth quarter of 2023.
■Stable Operating Leverage - The third quarter of 2024 efficiency ratio was 67.49% when compared to 66.23% in the second quarter of 2024. The third quarter efficiency ratio was affected by one-time data processing expense related to the fraud incident in the first quarter of 2024. The third quarter of 2024 non-GAAP efficiency ratio(1) was 62.10% when compared to 61.05% in the second quarter of 2024.
■Strong Deposit Growth - Total deposits increased to $5.23 billion at September 30, 2024 from $5.15 billion at June 30, 2024. Average noninterest bearing deposits increased to $1.58 billion for the third quarter of 2024 representing 30.55% of average funding, excluding subordinated debt, compared to 28.42% during the second quarter of 2024. The Bank’s use of wholesale funding, which includes Federal Home Loan Bank (“FHLB”) advances and brokered deposits, has been minimal in 2024. Wholesale funding increased from $44.5 million or 0.74% of assets at December 31, 2023 to $50.0 million or 0.84% of total assets at September 30, 2024. Sustained efforts to enhance the Bank’s deposit franchise are expected to continue to attract additional deposits in future quarters.
“Increasing net interest income drove a healthy increase in net interest margin in the third quarter,” stated James (“Jimmy”) M. Burke, President and Chief Executive Officer of Shore Bancshares, Inc. “Active management of our deposit relationships, combined with the recent reduction in rates by the Federal Reserve, have helped us stabilize our cost of funding even as assets yields continue to increase. Credit remains stable and economic activity in our markets remains strong. We continue to rapidly build capital and are optimistic that decreasing rates and clarity in November will result in loan growth.”
(1) Reconciliations of the non–U.S. generally accepted accounting principles (“GAAP”) measures are set forth at the end of this press release.
1

Balance Sheet Review
Total assets were $5.9 billion at September 30, 2024, a decrease of $93.2 million or 1.6%, 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 $188.8 million and investment securities held to maturity of $28.6 million partially offset by an increase in investment securities available for sale of $22.8 million and loans held for investment of $92.9 million. The ratio of the ACL to total loans remained flat at 1.24% at September 30, 2024 compared to December 31, 2023.
The Company’s tangible common equity ratio(1) at September 30, 2024 was 7.39% compared to 6.78% at December 31, 2023. The Company’s Tier 1 and Total Risk-Based Capital Ratios at September 30, 2024 were 9.89% and 12.04%, respectively. The Bank’s Tier 1 and Total Risk-Based Capital Ratios at September 30, 2024 were 10.60% and 11.84%, respectively. Non-owner occupied CRE loans as a percentage of the Bank’s Tier 1 Capital + ACL at September 30, 2024 and December 31, 2023 were $2.1 billion or 364.0% and $2.0 billion or 382.6%, respectively. Construction loans as a percentage of the Bank’s Tier 1 Capital + ACL at September 30, 2024 and December 31, 2023 were $337.1 million or 59.3% 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 $509.4 million or 10.8% of total loans of $4.7 billion at September 30, 2024. The Bank’s office CRE loan portfolio included $140.9 million or 27.7% of the total with medical tenants and $71.8 million or 14.1% of the total with government or government contractor tenants. There were 503 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 may vary from the appraised value at loan origination.
LTV RangeLoan Count Loan Balance % of Total CRE
Less than or equal to 50%258$177,771 35 %
50%-60%69118,547 23 %
60%-70%80111,951 22 %
70%-80%7382,674 16 %
Greater than 80%2318,433 4 %
Grand Total503$509,376 100 %
The Bank had 18 office CRE loans totaling $164.6 million with balances greater than $5.0 million at September 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. At September 30, 2024, the average loan debt-service coverage ratio was 2.5x and average LTV was 50.0%. Of the office CRE portfolio balance, 73% is secured by properties in rural or suburban areas with limited exposure to metropolitan cities and 97% is secured by properties with five stories or less. Of the office CRE loans, $2.0 million were classified as special mention or substandard at September 30, 2024.
Total deposits decreased $160.4 million, or 3.0% to $5.2 billion at September 30, 2024 when compared to December 31, 2023. The decrease in total deposits was primarily due to decreases in demand deposits of $414.0 million and money market and savings of $143.8 million, partially offset by increases in noninterest-bearing deposits of $313.4 million and time deposits of $84.0 million. The decrease in deposits is primarily attributable to seasonal municipal runoff and a decrease in interest rate-sensitive cannabis-related deposits. During the second quarter of 2024, the Company reclassified $399.4 million of demand deposits which carried an average rate of 4 bps to noninterest bearing deposits.
Total funding, which includes customer deposits, FHLB short and long-term advances, and brokered deposits was $5.28 billion at September 30, 2024 compared to $5.26 billion at June 30, 2024 and $5.43 billion at December 31, 2023. The Bank had $50.0 million in total FHLB advances at September 30, 2024 compared to aggregate advances of $81.0 million at June 30, 2024 and zero at December 31, 2023. The advance consisted of 18-month Bermuda Convertible of $50 million. The Bank had zero brokered deposits (excluding reciprocal deposits) at September 30, 2024 compared to $28.2 million at June 30, 2024 and $19.4 million at December 31, 2023. Total reciprocal deposits were $1.3 billion at September 30, 2024 compared to $1.2 billion at June 30, 2024 and $1.3 billion at December 31, 2023. 
The Bank's uninsured deposits at September 30, 2024 were $895.9 million or 17.14% of total deposits. The Bank's uninsured deposits, excluding deposits secured with pledged collateral, at September 30, 2024 were $768.6 million or 14.71% of total deposits. At September 30, 2024, the Bank had approximately $1.1 billion of available liquidity including: $183.6 million in cash, $932.5 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 $22.1 million, or 4.3%, when compared to December 31, 2023, primarily due to current year earnings, offset by cash dividends paid. As of September 30, 2024, the ratio of total equity to total assets was 9.01% and the ratio of total tangible equity to total tangible assets(1) was 7.39% compared to 8.50% and 6.78% at December 31, 2023, respectively.
2

Review of Quarterly Financial Results
Net interest income was $43.3 million for the third quarter of 2024, compared to $42.1 million for the second quarter of 2024 and $45.6 million for the third quarter of 2023. The increase in net interest income when compared to the second quarter of 2024 was primarily due to the increase in interest and fees on loans of $1.9 million and interest and dividends on investment securities of $268 thousand, partially offset by an increase in interest expense of $460 thousand. The increase in interest expense in the third quarter of 2024 was the result of higher interest expense on deposits of $1.3 million, partially offset by lower interest expense from carrying lower short-term advances from the FHLB during the quarter to offset seasonal outflows from municipal customers of $1.1 million. The decrease in net interest income when compared to the third quarter of 2023 was primarily due the higher interest expense on deposits of $5.4 million and long-term borrowings of $618 thousand. These were partially offset by an increase in interest and fees on loans of $4.3 million. All of these items were significantly impacted by the merger in the third quarter of 2023.
The Company’s net interest margin increased to 3.17% for the third quarter of 2024 from 3.11% for the second quarter of 2024 primarily due to loans 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 $77.8 million, or 2.2% which resulted in $1.3 million less interest expense. These interest-bearing deposits were almost entirely replaced with an increase in the average balance on noninterest-bearing deposits of $99.1 million, or 6.7%. The Company’s net interest margin decreased to 3.17% for the third quarter of 2024 from 3.35% for the third quarter of 2023. Comparing the third quarter of 2024 to the third quarter of 2023, the Company’s interest-earning asset yields increased 23 bps to 5.47% from 5.24%, while the cost of funds repriced at a slower pace resulting in an increase of 43 bps to 2.38% from 1.95% for the same period.
The provision for credit losses was $1.5 million for the three months ended September 30, 2024. The comparable amounts were $2.1 million for the three months ended June 30, 2024, and $28.2 million for the three months ended September 30, 2023. The increase in the provision for credit losses for the third quarter of 2024 compared to the second quarter of 2024 was due to new loan growth, increases in specific reserves and charge-offs in the third quarter of 2024. Coverage ratios remained flat at 1.24% at September 30, 2024 and June 30, 2024. The decrease in the provision for credit losses when compared to the third quarter of 2023 was primarily due to an enhanced CECL model in the third quarter of 2023 due to the merger. Net charge-offs were $1.4 million for the third quarter of 2024 and third quarter of 2023, compared to $886 thousand for the second quarter of 2024.
At September 30, 2024 and June 30, 2024, nonperforming assets were $15.8 million, or 0.27% of total assets and $17.0 million, or 0.29% of total assets, respectively. The balance of nonperforming assets decreased primarily due to a decrease in repossessed properties of $1.3 million. When comparing September 30, 2024 to September 30, 2023, nonperforming assets increased $4.5 million, primarily due to increases in nonaccrual loans of $5.9 million, an increase in repossessed marine loans and assets held for sale of $306 thousand, partially offset by a decrease of $1.7 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 third quarter of 2024 was $7.3 million, a decrease of $1.2 million from $8.4 million for the second quarter of 2024 and a decrease $7.7 million from $15.0 million for the third quarter of 2023. The decrease from the second quarter of 2024 was lower revenues from mortgage banking and Mid-Maryland Title Company, Inc. (the“title Company”). The Bank’s mortgage revenue declined $806 thousand due to lower interest rates which decreased the value of mortgage servicing rights $686 thousand and also drove higher prepayment rates. The title company revenues declined due to lower settlement activity than the prior quarter.
Total noninterest expense of $34.1 million for the third quarter of 2024 increased $615 thousand when compared to the second quarter of 2024 expense of $33.5 million and decreased $13.0 million when compared to the third quarter of 2023 expense of $47.2 million. The increase from the second quarter of 2024 was primarily due to one time data processing costs related to the fraud incident in the first quarter of 2024 and other fraud expenses. The decrease from the third quarter of 2023 was primarily due to one time merger related expenses that were incurred in 2023 partially offset by an increase in expenses 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 third quarter of 2024 when compared to the second quarter of 2024 and the third quarter of 2023 was 67.49%, 66.23% and 77.81%, respectively. Furthermore, non-GAAP efficiency ratios(1) for the same periods were 62.10%, 61.05% and 54.89%, respectively. The net operating expense ratio, which is non-interest expense less non-interest income divided by average assets, for the third quarter 2024 was 1.84%, compared to 1.73% and 2.21% for the second quarter of 2024 and the third quarter of 2023, respectively. The non-GAAP net operating expense ratio(1), which excludes core deposit intangible amortization and non-recurring activity, for the third quarter 2024 was 1.65%, compared to 1.55% and 1.48% for the second quarter of 2024 and the third quarter of 2023, respectively.
3

Review of Nine Month Financial Results
Net interest income for the first nine months of 2024 was $126.5 million, an increase of $32.8 million, or 34.9%, when compared to the first nine months of 2023. The increase in net interest income was primarily due to an increase in total interest income of $76.0 million, or 53.2%, which included an increase in interest and fees on loans of $73.8 million, or 57.4%. The increase of interest and fees on loans was primarily due to the increase in the average balance of loans of $1.4 billion, or 42.3%, and an increase in net accretion income of $5.5 million due to the merger. Increases to net interest income were partially offset by increased total interest expense of $43.2 million, or 87.9%, primarily due to increases in the cost of funds and in the average balance of interest-bearing deposits of $1.0 billion, or 38.1%. All of the increases in average balances were largely due to the merger.
The Company’s net interest margin remained flat at 3.12% for the nine months ended September 30, 2024 and 2023. Margins were flat as more rapid increases in rates on interest-bearing liabilities were offset by lower increases in interest-earning assets yields and larger balances in noninterest-bearing deposits. The increases in the average balance and rates paid on interest-bearing deposits of $1.0 billion and 104 bps, respectively, were partially offset by increases in the average balance and yields earned on average earning assets of $1.4 billion and 64 bps, respectively. Additionally, margins were positively impacted as average balances of noninterest-bearing deposits increased $424.9 million, or 43.2% from 25.9% of average funding for the nine months ended September 30, 2023 to 27.2% of average funding for the nine months ended September 30, 2024. Net accretion income impacted net interest margin by 29 bps and 21 bps for the nine months ended September 30, 2024 and 2023, respectively.
The provision for credit losses for the nine months ended September 30, 2024 and 2023 was $4.0 million and $30.1 million, respectively. The decrease in the provision for credit losses was due to higher levels of reserves required by the Company’s CECL model related to the merger in 2023. Net charge-offs for the nine months ended September 30, 2024 were $3.0 million compared to net recoveries of $1.5 million for the nine months ended September 30, 2023.
Total noninterest income for the nine months ended September 30, 2024 decreased $3.3 million or 13.0%, when compared to the same period in 2023. The decrease was primarily due to lower trust and investment fee income of $1.1 million and one-time third quarter 2023 bargain purchase income of $8.8 million offset by $2.2 million of losses on sale of investment securities, both a direct result of the merger with TCFC in the third quarter of 2023.
Total noninterest expense for the nine months ended September 30, 2024 increased $14.6 million, or 16.3%, when compared to the same period in 2023. Almost all noninterest expense line items increased as a result of the credit card fraud losses and the expanded operations of the newly combined Company. There were no merger-related expenses and $4.7 million of credit card fraud losses for the nine months ended September 30, 2024, compared to $16.8 million expenses and no fraud losses for the nine months ended September 30, 2023, respectively. The Company continues to focus on streamlining processes to unlock operational efficiencies and reduce overall noninterest expenses.
4

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 ability to remediate the existing material weaknesses 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
5

Shore Bancshares, Inc.
Financial Highlights (Unaudited)
For the Three Months Ended September 30,For the Nine Months Ended September 30,
(Dollars in thousands, except per share data)
20242023 Change20242023Change
PROFITABILITY FOR THE PERIOD
Net interest income$43,263$45,622(5.2)%$126,538$93,78234.9 %
Provision for credit losses1,47028,176(94.8)3,95830,056(86.8)
Noninterest income7,28714,984(51.4)22,29425,613(13.0)
Noninterest expense34,11447,158(27.7)104,31189,66116.3 
Income before income taxes14,966(14,728)201.6 40,563(322)12694.3 
Income tax expense 3,777(4,991)175.7 9,956(1,060)1039.2 
Net income$11,189$(9,737)214.9 $30,607$7384047.7 
Return on average assets 0.77 %(0.67)%144 bp0.70 %0.02 %68 bp
Return on average assets excluding amortization of intangibles, merger related expenses and credit card fraud losses - Non-GAAP (1) (2)
0.90 0.01 89 0.91 0.49 42 
Return on average equity 8.41 (7.25)1,566 7.84 0.24 760 
Return on average tangible equity - Non-GAAP (1), (2)
12.37 1.74 1,063 12.83 6.27 656 
Interest rate spread2.06 2.61 (55)2.18 2.46 (28)
Net interest margin3.17 3.35 (18)3.12 3.12 — 
Efficiency ratio - GAAP 67.49 77.81 (1,032)70.09 75.10 (501)
Efficiency ratio - Non-GAAP (1)
62.10 54.89 721 61.83 54.98 685 
Non-interest income to average assets0.50 1.03 (53)0.51 0.80 (29)
Non-interest expense to average assets2.34 3.24 (90)2.40 2.79 (39)
Net operating expense to average assets - GAAP1.84 2.24 (40)1.89 3.00 (111)
Net operating expense to average assets - Non-GAAP (1)
1.65 1.48 17 1.61 1.74 (13)
PER SHARE DATA
Basic and diluted net income per common share$0.34$(0.29)214.3 %$0.92$0.032938.3 %
Dividends paid per common share$0.12$0.12— %$0.36$0.36— %
Book value per common share at period end16.0015.145.7 
Tangible book value per common share at period end - Non-GAAP (1)
12.8811.7010.1 
Market value at period end13.9910.5233.0 
Market range:
High14.9913.3712.1 14.9918.15(17.4)
Low11.0310.277.4 10.0610.27(2.0)
AVERAGE BALANCE SHEET DATA
Loans$4,734,001$4,562,7483.8 %$4,698,694$3,301,92642.3 %
Investment securities656,375778,744(15.7)672,533693,382(3.0)
Earning assets5,435,3115,404,5720.6 5,427,7134,025,59734.8 
Assets5,810,4925,769,3120.7 5,808,1534,298,94335.1 
Deposits5,086,3485,066,8860.4 5,097,9513,655,68439.5 
Short-term and Long Term FHLB advances83,50070,34818.7 77,113148,546(48.1)
Subordinated Debt & TRUPS72,94671,9071.4 72,68252,83937.6 
Stockholders' equity529,155533,114(0.7)521,564419,80124.2 
____________________________________
(1)See the reconciliation of GAAP and Non-GAAP Measures table.
(2)This ratio excludes merger related expenses. See the reconciliation of GAAP and Non-GAAP Measures table.
6

Shore Bancshares, Inc.
Financial Highlights (Unaudited) - Continued
For the Three Months Ended September 30,For the Nine Months Ended September 30,
(Dollars in thousands, except per share data)20242023 Change20242023Change
CREDIT QUALITY DATA
Net charge-offs$1,379$1,449(4.8)%$2,995$1,51997.2 %
Nonaccrual loans $14,844$8,98265.3 %
Loans 90 days past due and still accruing4542,149(78.9)
Other real estate owned and Repossessed Property485179170.9 
Total nonperforming assets 15,78311,31039.5 
Borrowers experiencing financial difficulty ("BEFDs") (still accruing)——— 
Total nonperforming assets and BEFDs modifications$15,783$11,31039.5 
CAPITAL AND CREDIT QUALITY RATIOS
Period-end equity to assets9.01 %8.79 %22 bp
Period-end tangible equity to tangible assets - Non-GAAP (1)
7.39 6.93 46 
Annualized net charge-offs to average loans0.12 %0.13 %(1)bp0.09 %0.06 %3 bp
Allowance for credit losses as a percent of:
Period-end loans 1.24 %1.24 %— bp
Nonaccrual loans 395.24 635.17 (23,993)
Nonperforming assets 371.72 504.43 (13,271)
Accruing BEFDs modifications— — — 
Nonperforming assets and accruing BEFDs371.72 504.43 (13,271)
As a percent of total loans:
Nonaccrual loans 0.31 %0.19 %12 bp
As a percent of total loans, other real estate owned, and repossessed property
Nonperforming assets0.33 %0.24 %9 bp
As a percent of total assets:
Nonaccrual loans 0.25 %0.16 %9 bp
Nonperforming assets 0.27 %0.20 %7 
____________________________________
(1)See the reconciliation of GAAP and Non-GAAP Measures table.


7

Shore Bancshares, Inc.
Consolidated Balance Sheets (Unaudited)
September 30, 2024September 30, 2024
compared tocompared to
(In thousands, except per share data)September 30, 2024December 31, 2023September 30, 2023December 31, 2023September 30, 2023
ASSETS
Cash and due from banks$52,363$63,172$68,097(17.1)%(23.1)%
Interest-bearing deposits with other banks131,258309,24140,612(57.6)223.2 
Cash and cash equivalents183,621372,413108,709(50.7)68.9 
Investment securities available for sale (at fair value)133,339110,52179,14320.6 68.5 
Investment securities held to maturity (net of allowance for credit losses of $101 (September 30, 2024), $94 (December 31, 2023), $126 (September 30, 2023)) at amortized cost)484,583513,188523,051(5.6)(7.4)
Equity securities, at fair value5,9505,7035,4344.3 9.5 
Restricted securities20,25317,90013,36113.1 51.6 
Loans held for sale, at fair value26,8778,78214,725206.0 82.5 
Loans held for investment4,733,9094,641,0104,617,7192.0 2.5 
Less: allowance for credit losses(58,669)(57,351)(57,051)(2.3)(2.8)
Loans, net4,675,2404,583,6594,560,6682.0 2.5 
Premises and equipment, net81,66382,38681,149(0.9)0.6 
Goodwill63,26663,26663,266— — 
Other intangible assets, net40,60948,09050,685(15.6)(19.9)
Other real estate owned, net179179179— — 
Repossessed property, net306——— — 
Assets held for sale1,387——— — 
Mortgage servicing rights, at fair value5,3095,9265,890(10.4)(9.9)
Right of use assets, net11,38412,48712,741(8.8)(10.7)
Cash surrender value on life insurance103,729101,704100,9502.0 2.8 
Accrued interest receivable19,99219,21715,6834.0 27.5 
Deferred income taxes32,19140,70745,346(20.9)(29.0)
Other assets27,82624,79024,39212.2 14.1 
Total assets$5,917,704$6,010,918$5,705,372(1.6)3.7 
LIABILITIES
Noninterest-bearing deposits$1,571,393$1,258,037$1,211,40124.9 %29.7 %
Interest-bearing deposits3,654,3304,128,0833,897,343(11.5)(6.2)
Total deposits5,225,7235,386,1205,108,744(3.0)2.3 
Advances from FHLB - long-term50,000——— — 
Guaranteed preferred beneficial interest in junior subordinated debentures ("TRUPS")29,76829,53029,4510.8 1.1 
Subordinated debt43,68843,13942,9561.3 1.7 
Total borrowings123,45672,66972,40769.9 70.5 
Lease liabilities11,81612,85713,082(8.1)(9.7)
Accrued expenses and other liabilities23,43828,1379,561(16.7)145.1 
Total liabilities$5,384,433$5,499,783$5,203,794(2.1)3.5 
STOCKHOLDERS' EQUITY
Common stock, par value $0.01; authorized 50,000,000 shares$333$332$3310.3 0.6 
Additional paid in capital357,580356,007355,5750.4 0.6 
Retained earnings180,884162,290155,78111.5 16.1 
Accumulated other comprehensive loss(5,526)(7,494)(10,109)26.3 45.3 
Total stockholders' equity533,271511,135501,5784.3 6.3 
Total liabilities and stockholders' equity$5,917,704$6,010,918$5,705,372(1.6)3.7 
Period-end common shares outstanding$33,327$33,162$33,1360.5 0.6 
Book value per common share$16$15.41$15.143.8 5.7 
8

Shore Bancshares, Inc.
Consolidated Statements of Income (Unaudited)
For the Three Months Ended September 30,For the Nine Months Ended September 30,
(In thousands, except per share data)20242023% Change20242023% Change
INTEREST INCOME
Interest and fees on loans $69,157$64,8696.6 %$202,203$128,42457.4 %
Interest on investment securities:
Taxable4,9625,047(1.7)14,61112,84013.8 
Tax-exempt 627(77.8)1841(56.1)
Interest on federal funds sold—92(100.0)—92(100.0)
Interest on deposits with other banks5641,213(53.5)2,1021,54636.0 
Total interest income$74,689$71,2484.8 $218,934$142,94353.2 
INTEREST EXPENSE
Interest on deposits$28,856$23,47322.9 $84,938$40,668108.9 
Interest on short-term borrowings491692(29.0)2,1315,501(61.3)
Interest on long-term borrowings2,0791,46142.3 5,3272,99278.0 
Total interest expense$31,426$25,62622.6 $92,396$49,16187.9 
NET INTEREST INCOME$43,263$45,622(5.2)$126,538$93,78234.9 
Provision for credit losses1,47028,176(94.8)3,95830,056(86.8)
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES$41,793$17,446139.6 $122,580$63,72692.4 
NONINTEREST INCOME
Service charges on deposit accounts$1,543$1,5052.5 $4,543$3,98114.1 
Trust and investment fee income8801,933(54.5)2,5102,764(9.2)
Loss on sales and calls of investment securities—(2,166)100.0 —(2,166)100.0 
Interchange credits1,7111,5579.9 5,0154,08122.9 
Mortgage-banking revenue1,1771,377(14.5)3,9613,40816.2 
Title Company revenue1008912.4 344412(16.5)
Bargain purchase gain—8,816(100.0)—8,816(100.0)
Other noninterest income1,8761,8730.2 5,9214,31737.2 
Total noninterest income$7,287$14,984(51.4)$22,294$25,613(13.0)

9

Shore Bancshares, Inc.
Consolidated Statements of Income (Unaudited) - Continued
For the Three Months Ended September 30,For the Nine Months Ended September 30,
(In thousands, except per share data)20242023% Change20242023% Change
NONINTEREST EXPENSE
Salaries and wages$13,197$14,183(7.0)%$38,355$31,82220.5 %
Employee benefits3,3263,607(7.8)11,0158,96822.8 
Occupancy expense 2,3842,2456.2 7,2325,46332.4 
Furniture and equipment expense87675016.8 2,6811,76152.2 
Data processing3,0812,48524.0 8,9256,02248.2 
Directors' fees44329550.2 1,09773050.3 
Amortization of intangible assets2,3362,634(11.3)7,4823,510113.2 
FDIC insurance premium expense1,16061887.7 3,4001,74794.6 
Legal and professional fees1,3621,21711.9 4,3152,92647.5 
Fraud losses (1)
673262156.9 5,2373761292.8 
Merger related expenses—14,866(100.0)—16,754(100.0)
Other noninterest expenses5,2763,99632.0 14,5729,58252.1 
Total noninterest expense$34,114$47,158(27.7)104,31189,66116.3 
Income (loss) before income taxes$14,966$(14,728)201.6 40,563(322)12694.3 
Income tax expense (benefit)3,777(4,991)175.7 9,956(1,060)1039.2 
NET INCOME (LOSS)$11,189$(9,737)214.9 $30,607$7384047.7 
Weighted average shares outstanding - basic33,31833,1290.6 33,24724,35436.5 
Weighted average shares outstanding - diluted33,33933,1290.6 33,25524,35436.5 
Basic net income (loss) per common share$0.34$(0.29)214.3 $0.92$0.032938.3 
Diluted net income (loss) per common share$0.34$(0.29)214.3 $0.92$0.032938.3 
Dividends paid per common share$0.12$0.12— $0.36$0.36— 
____________________________________
(1)Fraud losses for the third quarter of 2024 and nine months ended September 30, 2024 include $337 thousand and $4.7 million in losses related to the one-time online credit card account opening credit card event. The third quarter expense of $337 thousand was related to non-recurring data processing charges to close the fraudulent accounts.

10

Shore Bancshares, Inc.
Consolidated Average Balance Sheets (Unaudited)
For the Three Months EndedFor the Three Months Ended
September 30, 2024September 30, 2023June 30, 2024
(Dollars in thousands)Average BalanceInterestYield/RateAverage BalanceInterestYield/Rate Average BalanceInterestYield/Rate
Earning assets
Loans (1), (2), (3)
Consumer real estate $1,412,086$20,7235.84 %$1,141,707$14,5485.06 %$1,388,168$19,2785.59 %
Commercial real estate 2,749,39539,8585.77 2,831,56940,5365.68 2,738,69339,3705.78 
Commercial 210,7283,7327.05 233,7565,3159.02 216,8093,9267.28 
Consumer320,9604,3065.34 332,4864,1834.99 327,7814,2655.23 
State and political1,883326.76 929104.27 2,331305.18 
Credit Cards7,1321709.48 6,1641499.59 8,3782019.65 
Other31,8174165.20 16,1372014.94 24,3503024.99 
Total Loans4,734,00169,2375.82 4,562,74864,9425.65 4,706,51067,3725.76 
Investment securities
Taxable655,7184,9623.03 778,0815,0472.59 705,4215,2302.97 
Tax-exempt (1)
65784.87 6633420.51 65884.86 
Interest-bearing deposits44,9355644.99 55,5471,2138.66 47,3725784.91 
Total earning assets5,435,31174,7715.47 5,404,57271,3285.24 5,459,96173,1885.39 
Cash and due from banks46,99651,71445,141
Other assets386,700359,726391,854
Allowance for credit losses(58,515)(46,700)(57,628)
Total assets$5,810,492$5,769,312$5,839,328
11

For the Three Months EndedFor the Three Months Ended
September 30, 2024September 30, 2023June 30, 2024
(Dollars in thousands)Average BalanceInterestYield/RateAverage BalanceInterestYield/Rate Average BalanceInterestYield/Rate
Interest-bearing liabilities
Demand deposits$581,517$5,4723.74 %$1,056,956$6,6592.50 %$711,138$5,5503.14 %
Money market and savings deposits 1,670,21010,4202.48 1,572,9206,8101.72 1,690,15710,2912.45 
Brokered deposits25,8292223.42 98,6491,2254.93 7,753944.88 
Certificates of deposit $100,000 or more797,4398,4334.21 706,6426,2723.52 758,2117,5814.02 
Other time deposits431,8344,3093.97 285,7432,5073.48 417,3314,0693.92 
Interest-bearing deposits (4)
3,506,82928,8563.27 3,720,91023,4732.50 3,584,59027,5853.10 
Advances from FHLB - short-term33,5004915.83 70,3486923.90 113,5491,5845.61 
Advances from FHLB - long-term50,0006254.97 ——— 30,2203464.60 
Subordinated debt and Guaranteed preferred beneficial interest in junior subordinated debentures ("TRUPS") (4)
72,9461,4547.93 71,9071,4618.06 72,6801,4518.03 
Total interest-bearing liabilities3,663,27531,4263.41 3,863,16525,6262.63 3,801,03930,9663.28 
Noninterest-bearing deposits1,579,5191,345,9761,480,384
Accrued expenses and other liabilities38,54327,05738,427
Stockholders' equity529,155533,114519,478
Total liabilities and stockholders' equity$5,810,492$5,769,312$5,839,328
Net interest income$43,345$45,702$42,222
Net Interest Spread2.06 %2.61 %2.11 %
Net Interest Margin3.17 %3.35 %3.11 %
Cost of Funds2.38 %1.95 %2.36 %
Cost of Deposits2.26 %1.84 %2.19 %
Cost of Debt6.54 %6.00 %6.28 %
____________________________________
(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 $5.0 million, $6.1 million and $4.5 million of accretion interest on loans for the three months ended September 30, 2024 and 2023, and June 30, 2024, respectively.
(4) Interest expense on deposits and borrowing includes amortization of deposit discount and amortization of borrowing fair value adjustments. There were $(287) thousand, $(484) thousand and $(421) thousand of amortization of deposits premium, and $(232) thousand, $(232) thousand, and $(243) thousand of amortization of borrowing fair value adjustments for the three months ended September 30, 2024 and 2023, and June 30, 2024, respectively.
12

Shore Bancshares, Inc.
Consolidated Average Balance Sheets (Unaudited)
For the Nine Months Ended September 30,
20242023
(Dollars in thousands)Average BalanceInterestYield/RateAverage BalanceInterestYield/Rate
Earning assets
Loans (1), (2), (3)
  Consumer real estate $1,387,387$58,493 5.63 %$990,970$35,929 4.85 %
  Commercial real estate 2,736,941117,832 5.75 1,806,98371,328 5.28 
  Commercial 215,78811,755 7.28 171,7029,312 7.25 
  Consumer325,93512,843 5.26 318,06611,440 4.81 
  State and political1,89678 5.50 93627 3.86 
  Credit Cards7,654539 9.41 2,077149 9.59 
  Other23,093900 5.21 11,192400 4.78 
Total Loans4,698,694 202,440 5.76 3,301,926 128,585 5.21 
Investment securities
Taxable671,87514,611 2.90 692,71812,840 2.47 
Tax-exempt (1)
65823 4.66 66452 10.44 
Interest-bearing deposits56,4862,102 4.97 27,7501,546 7.45 
Total earning assets5,427,713219,176 5.39 4,025,597143,115 4.75 
Cash and due from banks47,21136,831
Other assets391,106271,721
Allowance for credit losses(57,877)(35,206)
Total assets$5,808,153 $4,298,943 
Interest-bearing liabilities
Demand deposits$800,258$17,384 2.90 %$813,834$13,808 2.27 %
Money market and savings deposits 1,676,45730,871 2.46 1,163,59511,709 1.35 
Brokered deposits16,642567 4.55 33,2441,225 4.93 
Certificates of deposit $100,000 or more774,11223,689 4.09 421,8529,685 3.07 
Other time deposits422,21212,427 3.93 239,8344,241 2.36 
Interest-bearing deposits (4)
3,689,68184,938 3.07 2,672,35940,668 2.03 
Advances from FHLB - short-term50,2882,131 5.66 148,5465,501 4.95 
Advances from FHLB - long-term26,825971 4.84 —— — 
Subordinated debt and Guaranteed preferred beneficial interest in junior subordinated debentures ("TRUPS") (4)
72,6824,356 8.01 52,8392,992 7.57 
Total interest-bearing liabilities3,839,47692,396 3.21 2,873,74449,161 2.29 
Noninterest-bearing deposits1,408,270983,325
Accrued expenses and other liabilities38,84322,073
Stockholders' equity521,564 419,801 
Total liabilities and stockholders' equity$5,808,153 $4,298,943 
Net interest income$126,780 $93,954 
Net Interest Spread2.18 %2.46 %
Net Interest Margin3.12 %3.12 %
Cost of Funds2.35 %1.70 %
Cost of Deposits2.23 %1.49 %
Cost of Debt6.65 %5.64 %
____________________________________
(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 $13.7 million and $7.0 million of accretion interest on loans for the nine months ended September 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 $(1.1) million of amortization of deposit discounts and $(308) thousand of amortization of deposit premium, and $(695) thousand and $(325) thousand of amortization of borrowing fair value adjustment for the nine months ended September 30, 2024 and 2023, respectively.
13

Shore Bancshares, Inc.
Financial Highlights By Quarter (Unaudited)
3rd Quarter2nd Quarter1st Quarter4th Quarter3rd QuarterQ3 2024Q3 2024
20242024202420232023compared tocompared to
(Dollars in thousands, except per share data)Q3 2024Q2 2024Q1 2024Q4 2023Q3 2023Q2 2024Q3 2023
PROFITABILITY FOR THE PERIOD
Taxable-equivalent net interest income$43,345$42,222$41,214$41,606$45,7022.7 %(5.2)%
Less: Taxable-equivalent adjustment8282798180— 2.5 
Net interest income43,26342,14041,13541,52545,6222.7 (5.2)
Provision for credit losses1,4702,08140789628,176(29.4)(94.8)
Noninterest income7,2878,4406,5677,54814,984(13.7)(51.4)
Noninterest expense34,11433,49936,69833,67047,1581.8 (27.7)
Income/(loss) before income taxes14,96615,00010,59714,507(14,728)(0.2)201.6 
Income tax expense/ (benefit)3,7773,7662,4134,017(4,991)0.3 175.7 
Net income/ (loss) $11,189$11,234$8,184$10,490$(9,737)(0.4)214.9 
Return on average assets 0.77%0.77%0.57%0.72%(0.67)%— bp144 bp
Return on average assets excluding amortization of intangibles, fraud losses and merger related expenses - Non-GAAP (1), (2)
0.900.910.940.880.01(1)89 
Return on average equity 8.418.706.388.21(7.25)(29)1,566 
Return on average tangible equity - Non-GAAP (1), (2)
12.3712.8513.3912.881.74(48)1,063 
Net interest margin3.173.113.083.093.356 (18)
Efficiency ratio - GAAP 67.4966.2376.9368.6177.81126 (1,032)
Efficiency ratio - Non-GAAP (1)
62.1061.0562.3761.9954.89105 721 
PER SHARE DATA
Basic and diluted net income/(loss) per common share$0.34$0.34$0.25$0.32$(0.29)(0.7)%215.8 %
Dividends paid per common share0.120.120.120.120.12— — 
Book value per common share at period end16.0015.7415.5115.4115.141.7 5.7 
Tangible book value per common share at period end - Non-GAAP (1)
12.8812.5412.2412.0611.702.7 10.1 
Market value at period end13.9911.4511.5014.2510.5222.2 33.0 
Market range:
High14.9911.9014.3814.5113.3726.0 12.1 
Low11.0310.0610.569.6610.279.6 7.4 
____________________________________
(1)See the reconciliation of GAAP and Non-GAAP Measures table.
(2)This ratio excludes merger related expenses. See the reconciliation of GAAP and Non-GAAP Measures table.

14

Shore Bancshares, Inc.
Financial Highlights By Quarter (Unaudited) - Continued
3rd Quarter2nd Quarter1st Quarter4th Quarter3rd QuarterQ3 2024Q3 2024
20242024202420232023compared tocompared to
(Dollars in thousands, except per share data)Q3 2024Q2 2024Q1 2024Q4 2023Q3 2023Q2 2024Q3 2023
AVERAGE BALANCE SHEET DATA
Loans$4,734,001$4,706,510$4,655,183$4,639,467$4,562,7480.58 %3.75 %
Investment securities656,375706,079655,323619,920778,744(7.04)(15.71)
Earning assets5,435,3115,459,9615,387,7825,339,8335,404,572(0.45)0.57 
Assets5,810,4925,839,3285,774,8245,745,4405,769,312(0.49)0.71 
Deposits5,086,3485,064,9745,142,6585,136,8185,066,8860.42 0.38 
Short-term and Long Term FHLB advances83,500143,7694,0001,14170,348(41.92)18.70 
Subordinated Debt & TRUPS72,94672,68072,41872,15571,9070.37 1.44 
Stockholders' equity529,155519,478515,976507,040533,1141.86 (0.74)
CREDIT QUALITY DATA
Net charge offs $1,379$886$565$500$1,44955.64 %(4.83)%
Nonaccrual loans $14,844$14,837$12,776$12,784$8,9820.05 %65.26 %
Loans 90 days past due and still accruing4544141,5607382,1499.66 (78.87)
Other real estate owned and repossessed property4851,7392,024179179(72.11)170.95 
Total nonperforming assets $15,783$16,990$16,360$13,701$11,310(7.10)39.55 

15

Shore Bancshares, Inc.
Financial Highlights By Quarter (Unaudited) - Continued
3rd Quarter2nd Quarter1st Quarter4th Quarter3rd QuarterQ3 2024Q3 2024
20242024202420232023compared tocompared to
(Dollars in thousands, except per share data)Q3 2024Q2 2024Q1 2024Q4 2023Q3 2023Q2 2024Q3 2023
CAPITAL AND CREDIT QUALITY RATIOS
Period-end equity to assets9.01 %8.92 %8.84 %8.50 %8.79 %9 bp22 bp
Period-end tangible equity to tangible assets - Non-GAAP (1)
7.39 7.23 7.11 6.78 6.93 16 46 
Annualized net charge-offs to average loans0.12 %0.08 %0.05 %0.04 %0.13 %4 bp(1)bp
Allowance for credit losses as a percent of:
Period-end loans1.24 %1.24 %1.23 %1.24 %1.24 %— bp— bp
Period-end loans
1.24 1.24 1.23 1.24 1.24 — — 
Nonaccrual loans 395.24 394.14 448.78 448.62 635.17 110 (23,993)
Nonperforming assets 371.72 344.19 350.46 418.59 504.43 2,753 (13,271)
As a percent of total loans:
Nonaccrual loans 0.31 %0.32 %0.27 %0.28 %0.19 %(1)bp12 bp
As a percent of total loans, other real estate owned, and repossessed property
Nonperforming assets 0.33 %0.36 %0.35 %0.30 %0.24 %(3)bp9 bp
As a percent of total assets:
Nonaccrual loans 0.25 %0.25 %0.22 %0.21 %0.16 %— bp9 bp
Nonperforming assets 0.27 0.29 0.28 0.23 0.20 (2)7 
____________________________________
(1)See the reconciliation of GAAP and Non-GAAP Measures table.

16

Shore Bancshares, Inc.
Consolidated Balance Sheets (Unaudited)
September 30, 2024September 30, 2024
compared tocompared to
(In thousands, except per share data)September 30, 2024June 30, 2024March 31, 2024December 31, 2023September 30, 2023December 31, 2023September 30, 2023
ASSETS
Cash and due from banks$52,363 $50,090 $43,079 $63,172 $68,097 (17.1)%(23.1)%
Interest-bearing deposits with other banks131,258 88,793 71,481 309,241 40,612 (57.6)223.2 
Cash and cash equivalents183,621 138,883 114,560 372,413 108,709 (50.7)68.9 
Investment securities available for sale (at fair value)133,339 131,594 179,496 110,521 79,143 20.6 68.5 
Investment securities held to maturity (net of allowance for credit losses of $101 (September 30, 2024), $108 (June 30, 2024), $116 (March 31, 2024), $94 (December 31,2023), and $126 (September 30, 2023)) at amortized cost)484,583 499,431 503,822 513,188 523,051 (5.6)(7.4)
Equity securities, at fair value5,950 5,699 5,681 5,703 5,434 4.3 9.5 
Restricted securities20,253 21,725 17,863 17,900 13,361 13.1 51.6 
Loans held for sale, at fair value26,877 27,829 13,767 8,782 14,725 206.0 82.5 
Loans held for investment4,733,909 4,705,737 4,648,725 4,641,010 4,617,719 2.0 2.5 
Less: allowance for credit losses(58,669)(58,478)(57,336)(57,351)(57,051)(2.3)(2.8)
Loans, net4,675,240 4,647,259 4,591,389 4,583,659 4,560,668 2.1 2.5 
Premises and equipment, net81,663 82,176 83,084 82,386 81,149 (0.9)0.6 
Goodwill63,266 63,266 63,266 63,266 63,266 — — 
Other intangible assets, net40,609 42,945 45,515 48,090 50,685 (15.6)(19.9)
Other real estate owned, net179 179 179 179 179 — — 
Repossessed property, net306 1,560 1,845 — — — — 
Assets held for sale1,387 1,387 — — — — — 
Mortgage servicing rights, at fair value5,309 5,995 5,821 5,926 5,890 (10.4)(9.9)
Right of use assets, net11,384 11,762 12,153 12,487 12,741 (8.8)(10.7)
Cash surrender value on life insurance103,729 102,969 102,321 101,704 100,950 2.0 2.8 
Accrued interest receivable19,992 19,641 19,541 19,217 15,683 4.0 27.5 
Deferred income taxes32,191 36,078 38,978 40,707 45,346 (20.9)(29.0)
Other assets27,826 23,639 26,423 24,790 24,392 12.2 14.1 
Total assets$5,917,704 $5,864,017 $5,825,704 $6,010,918 $5,705,372 (1.5)3.7 

17

Shore Bancshares, Inc.
Consolidated Balance Sheets (Unaudited) - Continued
September 30, 2024September 30, 2024
compared tocompared to
(In thousands, except per share data)September 30, 2024June 30, 2024March 31, 2024December 31, 2023September 30, 2023December 31, 2023September 30, 2023
LIABILITIES
Noninterest-bearing deposits$1,571,393 $1,587,252 $1,200,680 $1,258,037 $1,211,401 24.9 %29.7 
Interest-bearing deposits3,654,330 3,561,633 3,983,599 4,128,083 3,897,343 (11.5)(6.2)
Total deposits5,225,723 5,148,885 5,184,279 5,386,120 5,108,744 (3.0)2.3 
Advances from FHLB - short-term— 31,000 — — — — — 
Advances from FHLB - long-term50,000 50,000 — — — — — 
Guaranteed preferred beneficial interest in junior subordinated debentures ("TRUPS")29,768 29,316 29,237 29,158 29,079 2.1 2.4 
Subordinated debt43,688 43,504 43,322 43,139 42,956 1.3 1.7 
Total borrowings123,456 153,820 72,559 72,297 72,035 70.8 71.4 
Lease liabilities11,816 12,189 12,552 12,857 13,082 (8.5)(9.7)
Accrued expenses and other liabilities23,438 26,340 41,086 28,509 9,933 (19.3)136.0 
Total liabilities5,384,433 5,341,234 5,310,476 5,499,783 5,203,794 (2.2)3.5 
STOCKHOLDERS' EQUITY
Common stock, par value $0.01; authorized 50,000,000 shares333 333 332 332 331 0.3 0.6 
Additional paid in capital357,580 356,994 356,464 356,007 355,575 0.4 0.6 
Retained earnings180,884 173,716 166,490 162,290 155,781 10.7 16.1 
Accumulated other comprehensive loss(5,526)(8,260)(8,058)(7,494)(10,109)23.8 45.3 
Total stockholders' equity533,271 522,783 515,228 511,135 501,578 4.2 6.3 
— 
Total liabilities and stockholders' equity$5,917,704 $5,864,017 $5,825,704 $6,010,918 $5,705,372 (1.6)3.7 
Period-end common shares outstanding33,32733,215 33,211 33,162 33,136 0.5 0.6 
Book value per common share$16.00 $15.74 $15.51 $15.41 $15.14 3.8 5.7 
18

Shore Bancshares, Inc.
Consolidated Statements of Income By Quarter (Unaudited)
Q3 2024Q3 2024
compared tocompared to
(In thousands, except per share data)Q3 2024Q2 2024Q1 2024Q4 2023Q3 2023Q2 2024Q3 2023
INTEREST INCOME
Interest and fees on loans $69,157$67,292$65,754$65,914$64,8692.8 %6.6 %
Interest on investment securities:
Taxable4,9625,2304,4193,9925,047(5.1)(1.7)
Tax-exempt666627— (77.8)
Interest on federal funds sold————92— (100.0)
Interest on deposits with other banks5645789601,2241,213(2.4)(53.5)
Total interest income74,68973,10671,13971,13671,2482.2 4.8 
INTEREST EXPENSE
Interest on deposits28,85627,58528,49728,13323,4734.6 22.9 
Interest on short-term borrowings4911,5845616692(69.0)(29.1)
Interest on long-term borrowings2,0791,7971,4511,4621,46115.7 42.3 
Total interest expense31,42630,96630,00429,61125,6261.5 22.6 
NET INTEREST INCOME43,26342,14041,13541,52545,6222.7 (5.2)
Provision for credit losses1,4702,08140789628,176(29.4)(94.8)
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES41,79340,05940,72840,62917,4464.3 139.6 
NONINTEREST INCOME
Service charges on deposit accounts1,5431,4931,5071,5191,5053.4 2.5 
Trust and investment fee income8808967348441,933(1.8)(54.5)
Loss on sales and calls of investment securities————(2,166)— 100.0 
Interchange credits1,7111,7171,5871,6331,557(0.4)9.9 
Mortgage-banking revenue1,1771,9838011,1051,377(40.7)(14.5)
Title Company revenue1001657813989(39.4)12.4 
Bargain purchase gain————8,816— (100.0)
Other noninterest income1,8762,1861,8602,3081,873(14.2)0.2 
Total noninterest income$7,287$8,440$6,567$7,548$14,984(13.7)(51.4)

19

Shore Bancshares, Inc.
Consolidated Statements of Income By Quarter (Unaudited) - Continued
Q3 2024Q3 2024
compared tocompared to
(In thousands, except per share data)Q3 2024Q2 2024Q1 2024Q4 2023Q3 2023Q2 2024Q3 2023
NONINTEREST EXPENSE
Salaries and wages$13,197$13,307$11,852$12,823$14,183(0.8)%(7.0)%
Employee benefits3,3263,5934,0973,3893,607(7.4)(7.8)
Occupancy expense 2,3842,4322,4162,3282,245(2.0)6.2 
Furniture and equipment expense876900904790750(2.7)16.8 
Data processing3,0812,9782,8672,7622,4853.5 24.0 
Directors' fees44335929542629523.4 50.2 
Amortization of intangible assets2,3362,5692,5762,5952,634(9.1)(11.3)
FDIC insurance premium expense1,1601,0891,1501,7336186.5 87.7 
Other real estate owned expenses, net————2— (100.0)
Legal and professional fees1,3621,3541,5991,4111,2170.6 11.9 
Fraud losses (1)
673624,502503262985.5 156.9 
Merger related expenses———60214,866— (100.0)
Other noninterest expenses5,2764,8564,4404,3083,9948.7 32.1 
Total noninterest expense34,11433,49936,69833,67047,1581.8 (27.7)
Income/(loss) before income taxes14,96615,00010,59714,507(14,728)(0.2)201.6 
Income tax expense/(benefit) 3,7773,7662,4134,017(4,991)0.3 175.7 
NET INCOME/(LOSS)$11,189$11,234$8,184$10,490$(9,737)(0.4)214.9 
Weighted average shares outstanding - basic33,31833,23433,18933,15333,1290.3 0.6 
Weighted average shares outstanding - diluted33,33933,23433,19133,32233,1290.3 0.6 
Basic net income/(loss) per common share$0.34$0.34$0.25$0.32$(0.29)(0.7)215.8 
Diluted net income/(loss) per common share$0.34$0.34$0.25$0.32$(0.29)(0.8)215.7 
Dividends paid per common share0.120.120.120.120.12— — 
____________________________________
(1)Fraud losses for the third quarter of 2024 and first quarter of 2024 include $337 thousand and $4.3 million in losses related to the one-time online credit card account opening credit card event. The third quarter expense of $337 thousand was related to non-recurring data processing charges to close the fraudulent accounts.
20

Shore Bancshares, Inc.
Consolidated Average Balance Sheets By Quarter (Unaudited)
Q3 2024Q2 2024Q1 2024Q4 2023Q3 2023
(Dollars in thousands)Average BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/Rate
Earning assets
Loans (1), (2), (3)
Consumer real estate $1,412,086$20,7235.84 %$1,388,168$19,2785.59 %$1,361,636$18,4925.46 %$1,331,150$18,6535.56 %$1,141,707$14,5485.06 %
Commercial real estate 2,749,39539,8585.77 2,738,69339,3705.78 2,722,60038,6045.70 2,728,09438,7305.63 2,831,56940,5365.68 
Commercial 210,7283,7327.05 216,8093,9267.28 219,8844,0977.49 221,3424,2957.70 233,7565,3159.02 
Consumer320,9604,3065.34 327,7814,2655.23 329,1184,2725.22 333,8073,8594.59 332,4864,1834.99 
State and political1,883326.76 2,331305.18 1,473164.37 1,290134.00 929104.27 
Credit Cards7,1321709.48 8,3782019.65 7,4571679.01 6,32016610.42 6,1641499.59 
Other31,8174165.20 24,3503024.99 13,0151835.66 17,4642776.29 16,1372014.94 
Total Loans4,734,00169,2375.82 4,706,51067,3725.76 4,655,18365,8315.69 4,639,46765,9935.64 4,562,74864,9425.65 
Investment securities
Taxable655,7184,9623.03 705,4215,2302.97 654,6634,4192.70 619,2593,9922.58 778,0815,0472.59 
Tax-exempt (1)
65784.87 65884.86 66084.85 66184.84 6633420.51 
Federal funds sold——— ——— ——— ——— 7,533924.85 
Interest-bearing deposits44,9355644.99 47,3725784.91 77,2769605.00 80,4461,2246.04 55,5471,2138.66 
Total earning assets5,435,31174,7715.47 5,459,96173,1885.39 5,387,78271,2185.32 5,339,83371,2175.29 5,404,57271,3285.24 
Cash and due from banks46,99645,14149,49963,50651,714
Other assets386,700391,854395,023399,409359,726
Allowance for credit losses(58,515)(57,628)(57,480)(57,308)(46,700)
Total assets$5,810,492$5,839,328$5,774,824$5,745,440$5,769,312
21

Q3 2024Q2 2024Q1 2024Q4 2023Q3 2023
(Dollars in thousands)Average BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/RateAverage BalanceInterestYield/Rate
Interest-bearing liabilities
Demand deposits$581,517$5,4723.74 %$711,138$5,5503.14 %$1,110,524$6,3622.30 %$1,117,117$6,6732.37 %$1,056,956$6,6592.50 %
Money market and savings deposits 1,670,21010,4202.48 1,690,15710,2912.45 1,669,07410,1602.45 1,605,9308,3302.06 1,572,9206,8101.72 
Brokered deposits25,8292223.42 7,753944.88 20,4652514.93 92,8401,3475.76 98,6491,2254.93 
Certificates of deposit $100,000 or more797,4398,4334.21 758,2117,5814.02 762,2107,6754.05 701,0516,8983.90 706,6426,2723.52 
Other time deposits431,8344,3093.97 417,3314,0693.92 417,3624,0493.90 391,8204,8854.95 285,7432,5073.48 
Interest-bearing deposits (4)
3,506,82928,8563.27 3,584,59027,5853.10 3,979,63528,4972.88 3,908,75828,1332.86 3,720,91023,4732.50 
Advances from FHLB - short-term33,5004915.83 113,5491,5845.61 4,000565.63 1,141165.56 70,3486923.90 
Advances from FHLB - long-term50,0006254.97 30,2203464.60 ——— ——— ——— 
Subordinated debt and Guaranteed preferred beneficial interest in junior subordinated debentures ("TRUPS") (4)
72,9461,4547.93 72,6801,4518.03 72,4181,4518.06 72,1551,4628.04 71,9071,4618.06 
Total interest-bearing liabilities3,663,27531,4263.41 3,801,03930,9663.28 4,056,05330,0042.98 3,982,05429,6112.95 3,863,16525,6262.63 
Noninterest-bearing deposits1,579,5191,480,3841,163,0231,228,0601,345,976
Accrued expenses and other liabilities38,54338,42739,77228,28627,057
Stockholders' equity529,155519,478515,976507,040533,114
Total liabilities and stockholders' equity$5,810,492$5,839,328$5,774,824$5,745,440$5,769,312
Net interest income$43,345$42,222$41,214$41,606$45,702
Net interest spread2.06 %2.11 %2.34 %2.34 %2.61 %
Net interest margin3.17 %3.11 %3.08 %3.09 %3.35 %
Cost of Funds2.38 %2.36 %2.31 %2.25 %1.95 %
Cost of Deposits2.26 %2.19 %2.23 %2.17 %1.84 %
Cost of Debt6.54 %6.28 %7.93 %8.00 %6.00 %
____________________________________
(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 $5.0 million, $4.5 million, $4.2 million, $4.8 million and $6.1 million of accretion interest on loans for the three months ended September 30, 2024, June 30, 2024, March 31, 2024, December 31, 2023, and September 30, 2023, respectively.
(4) Interest expense on deposits and borrowing includes amortization of deposit premiums and amortization of borrowing fair value adjustment. There were $(287) thousand, $(421) thousand, $(367) thousand, $(1.5) million and $(484) thousand of amortization of deposits premium, and $(232) thousand, $(243) thousand, $(220) thousand, $(232) thousand and $(232) thousand of amortization of borrowing fair value adjustment for the three months ended September 30, 2024, June 30, 2024, March 31, 2024, December 31, 2023, and September 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)Q3 2024Q2 2024Q1 2024Q4 2023Q3 20239/30/20249/30/2023
The following reconciles return on average assets, average equity and return on average tangible equity (Note 1):
Net income (loss) $11,189 $11,234 $8,184 $10,490 $(9,737)$30,607 $738 
Net income (loss) - annualized (A)$44,513 $45,183 $32,916 $41,618 $(38,632)$40,884 $987 
Net income (loss) $11,189 $11,234 $8,184 $10,490 $(9,737)$30,607 $738 
Add: Amortization of intangible assets, net of tax1,746 1,924 1,989 1,876 1,741 5,646 2,597 
Add: Merger Expenses, net of tax— — — 435 9,828 — 12,398 
Add: Credit Card Fraud Losses, net of tax252 — 3,339 — — 3,516 — 
Net income, excluding net amortization of intangible assets, merger related expenses and credit card fraud losses13,187 13,158 13,512 12,801 1,832 39,769 15,733 
Net income, excluding net amortization of intangible assets, merger related expenses and credit card fraud losses - annualized (B)$52,461 $52,921 $54,345 $50,787 $7,268 $53,122 $21,035 
Return on average assets (GAAP)0.77 %0.77 %0.57 %0.72 %(0.67)%0.70 %0.02 %
Return on average assets excluding net amortization of intangible assets, merger related expenses and credit card fraud losses - (Non-GAAP)0.90 %0.91 %0.94 %0.88 %0.01 %0.91 %0.49 %
Average assets$5,810,492 $5,839,328 $5,774,824 $5,745,440 $5,769,312 $5,808,153 $4,298,943 
Average stockholders' equity (C)$529,155 $519,478 $515,976 $507,040 $533,114 $521,564 $419,801 
Less: Average goodwill and core deposit intangible(105,136)(107,594)(110,167)(112,752)(115,604)(107,623)(84,300)
Average tangible equity (D)$424,019 $411,884 $405,809 $394,288 $417,510 $413,941 $335,501 
Return on average equity (GAAP) (A)/(C)8.41 %8.70 %6.38 %8.21 %(7.25)%7.84 %0.24 %
Return on average tangible equity (Non-GAAP) (B)/(D)12.37 %12.85 %13.39 %12.88 %1.74 %12.83 %6.27 %
23

Shore Bancshares, Inc.
Reconciliation of Generally Accepted Accounting Principles (GAAP) and Non-GAAP Measures (Unaudited) - Continued
YTDYTD
(In thousands, except per share data)Q3 2024Q2 2024Q1 2024Q4 2023Q3 20239/30/20249/30/2023
The following reconciles GAAP efficiency ratio and non-GAAP efficiency ratio (Note 2):
Noninterest expense (E)$34,114 $33,499 $36,698 $33,670 $47,158 $104,311 $89,661 
Less: Amortization of intangible assets(2,336)(2,569)(2,576)(2,595)(2,634)(7,482)(3,510)
Less: Merger Expenses— — — (602)(14,866)— (16,754)
Less: Credit Card Fraud Losses(337)— (4,323)— — (4,660)— 
Adjusted noninterest expense (F)$31,441 $30,930 $29,799 $30,473 $29,658 $92,169 $69,397 
Net interest income (G)$43,263 $42,140 $41,135 $41,525 $45,622 $126,538 $93,782 
Add: Taxable-equivalent adjustment82 82 79 81 80 242 172 
Taxable-equivalent net interest income (H)$43,345 $42,222 $41,214 $41,606 $45,702 $126,780 $93,954 
Noninterest income (I)$7,287 $8,440 $6,567 $7,548 $14,984 $22,294 $25,613 
Investment securities losses (gains)— — — — 2,166 — (2,166)
Less: Bargain purchase gain— — — — (8,816)— 8,816 
Adjusted noninterest income (J)$7,287 $8,440 $6,567 $7,548 $8,334 $22,294 $32,263 
Efficiency ratio (GAAP) (E)/(G)+(I) 67.49 %66.23 %76.93 %68.61 %77.81 %70.09 %75.10 %
Efficiency ratio (Non-GAAP) (F)/(H)+(J)62.10 %61.05 %62.37 %61.99 %54.89 %61.83 %54.98 %
Net operating expense to average assets (GAAP)1.84 %1.73 %2.07 %1.80 %2.24 %1.89 %3.00 %
Net operating expense to average assets (Non-GAAP)1.65 %1.55 %1.60 %1.58 %1.48 %1.61 %1.74 %
24

Shore Bancshares, Inc.
Reconciliation of Generally Accepted Accounting Principles (GAAP) and Non-GAAP Measures (Unaudited) - Continued
(In thousands, except per share data)Q3 2024Q2 2024Q1 2024Q4 2023Q3 2023
The following reconciles book value per common share and tangible book value per common share (Note 1):
Stockholders' equity (K)$533,271 $522,783 $515,228 $511,135 $501,578 
Less: Goodwill and core deposit intangible(103,875)(106,211)(108,781)(111,356)(113,951)
Tangible equity (L)$429,396 $416,572 $406,447 $399,779 $387,627 
Shares outstanding (M)33,32733,21533,21133,16233,136
Book value per common share (GAAP) (K)/(M)$16.00$15.74$15.51$15.41$15.14
Tangible book value per common share (Non-GAAP) (L)/(M)$12.88$12.54$12.24$12.06$11.70
The following reconciles equity to assets and tangible equity to tangible assets (Note 1):
Stockholders' equity (N)$533,271$522,783$515,228$511,135$501,578
Less: Goodwill and core deposit intangible(103,875)(106,211)(108,781)(111,356)(113,951)
Tangible equity (O)$429,396$416,572$406,447$399,779$387,627
Assets (P)$5,917,704$5,864,017$5,825,704$6,010,918$5,705,372
Less: Goodwill and core deposit intangible(103,875)(106,211)(108,781)(111,356)(113,951)
Tangible assets (Q)$5,813,829$5,757,806$5,716,923$5,899,562$5,591,421
Period-end equity/assets (GAAP) (N)/(P)9.01%8.92%8.84%8.50%8.79%
Period-end tangible equity/tangible assets (Non-GAAP) (O)/(Q)7.39%7.23%7.11%6.78%6.93%
____________________________________
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)September 30, 2024%June 30, 2024%March 31, 2024%December 31, 2023%September 30, 2023%
Portfolio Loans by Loan Type
Construction$337,113 7.12 %$327,875 6.97 %$299,133 6.43 %$299,000 6.44 %$328,750 7.12 %
Residential real estate1,570,998 33.19 %1,539,590 32.72 %1,515,134 32.59 %1,490,438 32.11 %1,439,464 31.17 %
Commercial real estate2,276,381 48.09 %2,287,497 48.60 %2,272,867 48.90 %2,286,154 49.27 %2,283,521 49.45 %
Commercial225,083 4.75 %218,987 4.65 %229,594 4.94 %229,939 4.95 %229,474 4.97 %
Consumer317,149 6.70 %324,480 6.90 %325,076 6.99 %328,896 7.09 %330,411 7.16 %
Credit Cards7,185 0.15 %7,308 0.16 %6,921 0.15 %6,583 0.14 %6,099 0.13 %
Total loans4,733,909 100.00 %4,705,737 100.00 %4,648,725 100.00 %4,641,010 100.00 %4,617,719 100.00 %
Less: Allowance for credit losses(58,669)(58,478)(57,336)(57,351)(57,051)
Total loans, net$4,675,240 $4,647,259 $4,591,389 $4,583,659 $4,560,668 

26

Shore Bancshares, Inc.
Classified Assets and Nonperforming Assets (Unaudited)
Classified assets and nonperforming assets are summarized as follows:
(dollars in thousands)September 30, 2024June 30, 2024March 31, 2024December 31, 2023September 30, 2023
Classified Loans
Substandard$22,798 $17,409 $13,403 $14,673 $10,888 
Doubtful— — — — — 
Loss— — — — — 
Total Classified Loans$22,798 $17,409 $13,403 $14,673 $10,888 
Special Mention Loans14,385 25,549 27,192 28,264 24,931 
Total Classified and Special Mention Loans$37,183 $42,958 $40,595 $42,937 $35,819 
Classified Loans$22,798 $17,409 $13,403 $14,673 $10,888 
Other Real Estate Owned179 179 179 179 179 
Repossessed Property306 1,560 1,845 — — 
Classified Securities— — — — — 
Total Classified Assets$23,283 $19,148 $15,427 $14,852 $11,067 
Classified Assets to Total Assets0.39 %0.33 %0.26 %0.25 %0.19 %
Non-accrual Loans$14,844 $14,837 $12,776 $12,784 $8,982 
90+ Days Delinquent Accruing454 414 1,560 738 2,149 
Accruing BEFDs Loans ("BEFDs")— — — — — 
Other Real Estate Owned ("OREO")179 179 179 179 179 
Repossessed Property306 1,560 1,845 — — 
Total Nonperforming Assets$15,783 $16,990 $16,360 $13,701 $11,310 
Nonperforming Assets to Total Assets0.27 %0.29 %0.28 %0.23 %0.20 %
Total Assets$5,917,704 $5,864,017 $5,825,704 $6,010,918 $5,705,372 

27

Shore Bancshares, Inc.
Summary of Deposits (Unaudited)
September 30, 2024June 30, 2024March 31, 2024December 31, 2023September 30, 2023
(dollars in thousands)Balance%Balance%Balance%Balance%Balance%
Noninterest-bearing demand$1,571,393 30.07 %$1,587,252 30.83 %$1,200,680 23.15 %$1,258,037 23.36 %$1,211,401 23.70 %
Interest-bearing:
Demand751,533 14.38 %658,512 12.79 %1,101,954 21.26 %1,165,546 21.64 %1,210,051 23.69 %
Money market deposits1,297,237 24.82 %1,337,274 25.97 %1,358,205 26.20 %1,430,603 26.56 %1,179,049 23.08 %
Savings336,903 6.45 %352,069 6.84 %354,098 6.83 %347,324 6.45 %371,755 7.28 %
Certificates of deposit1,268,657 24.28 %1,213,778 23.57 %1,169,342 22.56 %1,184,610 21.99 %1,136,488 22.25 %
Total interest-bearing3,654,330 69.93 %3,561,633 69.17 %3,983,599 76.85 %4,128,083 76.64 %3,897,343 76.30 %
Total Deposits$5,225,723 100.00 %$5,148,885 100.00 %$5,184,279 100.00 %$5,386,120 100.00 %$5,108,744 100.00 %
28
v3.24.3
Cover
Oct. 24, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Oct. 24, 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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