Financial Performance - Net income for Q2 2024 was $11.2 million, or $0.34 per diluted share, compared to $8.2 million, or $0.25 per diluted share in Q1 2024, and $4.0 million, or $0.20 per diluted share in Q2 2023[4]. - Net income rose by 179.6% to $11,234,000 for the three months ended June 30, 2024, up from $4,018,000 in the prior year[25]. - Basic and diluted net income per common share increased by 69.1% to $0.34 for the three months ended June 30, 2024, compared to $0.20 in 2023[25]. - Year-to-date net income as of June 30, 2024, reached $19,418,000, compared to $10,475,000 for the same period in 2023, reflecting an increase of 85.5%[89]. Interest Income and Margin - Net interest income increased to $42.1 million in Q2 2024, up from $41.1 million in Q1 2024 and $22.5 million in Q2 2023, representing a year-over-year increase of 87.3%[13]. - The net interest margin (NIM) expanded to 3.11% in Q2 2024 from 3.08% in Q1 2024, and from 2.68% in Q2 2023[5]. - Interest income from loans increased by 105.6% year-over-year, reaching $67,292 thousand for the three months ended June 30, 2024, compared to $32,729 thousand for the same period in 2023[24]. - Total interest income for Q2 2024 was $73,106,000, an increase of 2.8% compared to Q1 2024 and 99.6% compared to Q2 2023[84]. Deposits and Loans - Total deposits decreased by $237.2 million, or 4.4%, to $5.1 billion at June 30, 2024, primarily due to a decrease in demand deposits[11]. - Average interest-bearing deposits decreased by $395.0 million, or 9.9%, while noninterest-bearing deposits increased by $317.4 million, or 27.3%[13]. - Total loans for the three months ended June 30, 2024, amounted to $4,706,510,000, with interest income of $67,372,000, yielding a rate of 5.76%[50]. - Loans held for investment increased by 1.4% from $4,641,010 thousand on December 31, 2023, to $4,705,737 thousand on June 30, 2024, and by 70.9% compared to $2,753,223 thousand on June 30, 2023[23]. Noninterest Income and Expenses - Noninterest income for the first six months of 2024 increased by $4.4 million, or 41.2%, compared to the same period in 2023[16]. - Total noninterest income for Q2 2024 was $8.4 million, an increase of $1.9 million from Q1 2024 and an increase of $3.1 million from Q2 2023[37]. - Total noninterest expense for the first six months of 2024 increased by $27.7 million, or 65.2%, compared to the same period in 2023, largely due to the merger[16]. - Total noninterest expense for Q2 2024 was $33.5 million, a decrease of $3.2 million from Q1 2024 but an increase of $11.9 million from Q2 2023[37]. Credit Losses and Asset Quality - The provision for credit losses was $2.1 million for Q2 2024, compared to $0.4 million in Q1 2024 and $0.7 million in Q2 2023, reflecting a significant increase due to new loan growth[13]. - The allowance for credit losses increased by 212.0% to $2,081 thousand for the three months ended June 30, 2024, compared to $667 thousand for the same period in 2023[24]. - Nonperforming assets increased to $18.4 million, or 0.31% of total assets, as of June 30, 2024, up from $16.4 million, or 0.28% of total assets, as of March 31, 2024[37]. - The annualized net charge-offs to average loans ratio was 0.08%, up from 0.01% in the previous year, indicating a 7 basis points increase[45]. Capital Ratios and Equity - The Tier 1 Capital Ratio and Total Risk-Based Capital Ratio increased by 14 basis points to 9.67% and 11.82%, respectively, as of June 30, 2024[5]. - Total stockholders' equity increased by $11.6 million or 2.3% compared to December 31, 2023, primarily due to current year earnings[35]. - Book value per common share increased by 2.1% from $15.41 on December 31, 2023, to $15.74 on June 30, 2024, but decreased by 13.7% compared to $18.24 on June 30, 2023[23]. - Period-end equity to assets increased to 8.92% from 8.84% in Q1 2024, but decreased from 9.97% in Q2 2023[79]. Efficiency and Management - The efficiency ratio improved to 66.2% in Q2 2024 from 76.9% in Q1 2024 and 77.8% in Q2 2023[33]. - The company anticipates ongoing expense management and technology investments to improve operating leverage over time[33]. - The company reported a significant increase in fraud losses, which rose to $62,000 for the three months ended June 30, 2024, compared to $47,000 in the same period of 2023, marking a 31.9% increase[25]. Asset Growth and Composition - Total assets decreased by 2.4% from $6,010,918 thousand on December 31, 2023, to $5,864,017 thousand on June 30, 2024, while increasing by 61.0% compared to $3,641,631 thousand on June 30, 2023[23]. - Total assets as of June 30, 2024, were $5,839,328,000, compared to $3,596,311,000 in the previous year[50]. - Cash and due from banks increased by 16.6% to $50,090 thousand compared to $43,079 thousand in Q1 2024, and up 41.4% from $35,423 thousand in Q2 2023[81].

Financial Performance - Net income for Q1 2024 was $8,184 thousand, up 26.69% from $6,457 thousand in Q1 2023[15]. - Net interest income for the three months ended March 31, 2024, was $41,135 thousand, an increase of 60.06% compared to $25,664 thousand for the same period in 2023[13]. - Noninterest income increased to $6,567 thousand for Q1 2024, compared to $5,334 thousand in Q1 2023, reflecting a growth of 23.14%[13]. - The efficiency ratio increased to 76.93% in Q1 2024 from 67.40% in Q1 2023, indicating higher operational expenses relative to revenues[207]. - The return on average assets ("ROAA") decreased to 0.57% in Q1 2024 from 0.75% in Q1 2023[207]. - The net interest margin ("NIM") remained stable at 3.08% for Q1 2024, compared to 3.18% for Q1 2023[207]. Asset and Deposit Changes - Total assets decreased to $5,825,704 thousand as of March 31, 2024, down from $6,010,918 thousand at December 31, 2023, representing a decline of approximately 3.08%[11]. - Total deposits decreased to $5,184,279 thousand as of March 31, 2024, down from $5,386,120 thousand at December 31, 2023, a reduction of approximately 3.74%[11]. - The company reported a decrease in noninterest-bearing deposits by $57,357,000 and interest-bearing deposits by $144,851,000, indicating a tightening of liquidity[23]. - Cash and cash equivalents at the end of the period were $114,560,000, down from $372,413,000 at the beginning of the period, reflecting a net decrease of $257,853,000[23]. Credit Quality and Losses - The provision for credit losses was $407 thousand for Q1 2024, a decrease from $1,213 thousand in Q1 2023, indicating improved credit quality[13]. - The total allowance for credit losses (ACL) was $57,336 million, with net charge-offs of $654 million for the three months ended March 31, 2024[91]. - Gross charge-offs for the three months ended March 31, 2024, totaled $538 thousand, with specific charge-offs of $227 thousand for prior loans, $58 thousand for 2020 loans, and $238 thousand for 2022 loans[81]. - Non-accrual loans totaled $12.776 million as of March 31, 2024, compared to $12.784 million as of December 31, 2023[70]. Acquisition and Market Presence - The acquisition of TCFC was completed for approximately $153.6 million, enhancing the company's market presence in Maryland, Virginia, and Delaware[36]. - The total purchase price for the acquisition of TCFC was $153.592 million, which included the fair value of common shares issued, cash consideration, and the fair value of converted restricted stock units[40]. - The identifiable assets acquired from TCFC totaled $2.412833 billion, with loans netting $1.765255 billion and total securities amounting to $454.468 million[40]. Capital and Regulatory Compliance - The Common Equity Tier 1 capital ratio as of March 31, 2024, is 8.91%, exceeding the regulatory minimum of 7.00%[129]. - The Tier 1 capital ratio is reported at 9.53% as of March 31, 2024, above the regulatory minimum of 8.50%[129]. - The total risk-based capital ratio stands at 11.68% as of March 31, 2024, surpassing the minimum requirement of 10.50%[129]. - The Company maintained compliance with all capital adequacy requirements as of March 31, 2024, with no conditions affecting its classification as well capitalized[126]. Operational Changes - The company plans to close two branches, with the Onley branch scheduled for closure on or about July 17, 2024, and the Westgate branch on or about September 30, 2024[180]. - The total amortization expense for the three months ended March 31, 2024, was $2.6 million, significantly higher than $0.4 million for the same period in 2023[102]. - The company will continue to review doubtful assets quarterly, indicating a proactive approach to managing potential losses[77]. Loan Portfolio and Risk Management - The company reported a total loan portfolio of $4.648725 billion as of March 31, 2024, with an allowance for credit losses on loans of $57.336 million[67]. - The residential real estate loans accounted for 32.59% of total loans, increasing from 32.11% as of December 31, 2023[67]. - The total amount of residential real estate loans reached $1,515,134 thousand, with pass loans constituting $1,506,161 thousand[81]. - The company has a strong focus on maintaining high credit quality in its mortgage-backed securities, which are guaranteed by U.S. government entities[60].

18 E. Dover Street Easton, Maryland 21601 Phone 410-763-7800 PRESS RELEASE Shore Bancshares, Inc. Reports 2024 First Quarter Financial Results Easton, Maryland (May 2, 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 first quarter of 2024 of $8.2 million or $0.25 per diluted common share compared to a net income of $10.5 million or $0.32 per diluted common share for the four ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________________ FORM 10-K þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Year Ended December 31, 2023 o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File No. 0-22345 SHORE BANCSHARES, INC. (Exact name of registrant as specified in its charter) Maryland 52-1974638 (State or other jurisdictio ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ______________________________________________________ FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended September 30, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ____________ Commission File Number: 0-22345 SHORE BANCSHARES, INC. (Exact n ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 0-22345 SHORE BANCSHARES, INC. (Exact name of registrant as specified in its charter) | Maryland | 52-1974638 | | --- | --- | ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 0-22345 SHORE BANCSHARES, INC. (Exact name of registrant as specified in its charter) | Maryland | 52-1974638 | | --- | --- | ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Year Ended December 31, 2022 ◻ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File No. 0-22345 SHORE BANCSHARES, INC. (Exact name of registrant as specified in its charter) | Maryland | 52-1974638 | | --- | --- | | (State or Other Jurisdiction of | (I.R.S. Employe ...

Table of Contents Commission file number 0-22345 SHORE BANCSHARES, INC. (Exact name of registrant as specified in its charter) | Maryland | 52-1974638 | | --- | --- | | (State or Other Jurisdiction of | (I.R.S. Employer | | Incorporation or Organization) | Identification No.) | UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 2022 OR ☐ TRANSITION ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended March 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 0-22345 SHORE BANCSHARES, INC. (Exact name of registrant as specified in its charter) | Maryland | 52-1974638 | | --- | --- | ...