Shore Bancshares Reports Second Quarter and First-Half Results
EASTON, Md., July 27 /PRNewswire-FirstCall/ -- Shore Bancshares, Inc. (Nasdaq: SHBI) reported net income of $445 thousand or $0.05 per diluted common share for the second quarter of 2010, compared to a net loss of $1.6 million or $(0.19) per diluted common share for the first quarter of 2010, and net income of $354 thousand or $0.04 per diluted common share for the second quarter of 2009. The second quarter of 2010 included a provision for credit losses of $4.9 million, which was $2.7 million lower than the comparable amount for the first quarter of 2010 but $3.2 million higher than the comparable amount for the second quarter of 2009. For the second quarter of 2009, net income available to common stockholders was negatively impacted by $1.5 million in dividends and discount accretion associated with the sale and subsequent repurchase of preferred stock under the U.S. Department of the Treasury’s Troubled Asset Relief Program Capital Purchase Program.
The Company reported a net loss of $1.1 million or $(0.13) per diluted common share for the first half of 2010, compared to net income of $2.2 million or $0.27 per diluted common share for the first half of 2009. The provision for credit losses was $12.5 million for the first half of 2010 and $3.6 million for the first half of 2009. Net income for the first six months of 2009 reflected $1.9 million in preferred stock dividends and discount accretion.
“In this tough credit and economic environment, we are pleased to be able to report a modest profit this quarter,” said W. Moorhead Vermilye, president and chief executive officer. “Our teams of loan workout and credit assessment specialists have been working diligently to identify, monitor, resolve and eventually dispose of problem loans and we are confident they are doing an effective job as we move through this cycle. This is our principal focus, and in the face of weak loan demand, we understand clearly what issues we need to resolve to maintain our traditionally stellar balance sheet.”
The Company’s return on average assets for the second quarter of 2010 was 0.16%, compared to (0.55)% and 0.13% for the quarters ended March 31, 2010 and June 30, 2009, respectively. The return on average stockholders’ equity was 1.42% for the second quarter of 2010, compared to (4.95)% for the first quarter of 2010 and 1.07% for the second quarter of 2009.
The Company’s return on average assets for the first six months of 2010 was (0.20)%, compared to 0.41% for the first six months of 2009. The return on average stockholders’ equity was (1.78)% for the first half of 2010, compared to 3.18% for the first half of 2009.
Total assets were $1.129 billion at June 30, 2010, compared to $1.157 billion at the end of 2009, a decrease of 2.4%. Total loans were $905.5 million, a decrease of 1.2%, and total deposits were $971.6 million, a decrease of 2.0%, when compared to December 31, 2009. Total stockholders’ equity decreased 2.5% from $127.8 million at the end of 2009 to $124.7 million at June 30,2010.
Review of Quarterly Financial Results
Net interest income for the second quarter of 2010 was $10.7 million, an increase of 2.8% from the first quarter of 2010 and an increase of 6.0% from the same period last year. The increase in net interest income when compared to the first quarter of 2010 was due to slightly higher rates on average earning assets and a decrease in the balances and rates paid on interest bearing liabilities offsetting the decline in average earning assets. The increase in net interest income when compared to the second quarter of 2009 was primarily due to higher average balances of earning assets and lower rates paid on interest bearing liabilities offsetting the decline in yields on earning assets. The Company’s net interest margin was 4.03% for the second quarter of 2010, an increase of 8 basis points when compared to the first quarter of 2010 and an increase of 18 basis points when compared to the second quarter of 2009.
As previously mentioned, the provision for credit losses was $4.9 million for the three months ended June 30, 2010. The comparable amounts were $7.6 million and $1.7 million for the three months ended March 31, 2010 and June 30, 2009, respectively. The ratio of the allowance for credit losses to period-end loans increased to 1.47% at June 30, 2010, compared to 1.41% at March 31, 2010 and 1.17% at June 30, 2009. Management believes that the provision for credit losses and the resulting allowance were adequate at June 30, 2010.
The continued historically large level of provision expense was primarily in response to the overall increase in nonperforming assets and loan charge-offs, as well as overall economic conditions. Net charge-offs were $4.4 million for the second quarter of 2010, $5.7 million for the first quarter of 2010 and $1.6 million for the second quarter of 2009. The ratio of quarter-to-date annualized net charge-offs to average loans was 1.95% for the second quarter of 2010, 2.54% for the first quarter of 2010 and 0.71% for the second quarter of 2009. The ratio of nonperforming assets to total assets was 3.42% at June 30, 2010. The comparable nonperforming asset ratio was 2.87% at March 31, 2010, and 1.37% at June 30, 2009.
Total noninterest income for the second quarter of 2010 decreased $314 thousand when compared to the first quarter of 2010 and decreased $779 thousand when compared to the second quarter of 2009. The decrease when compared to the first quarter of 2010 was primarily a result of a decrease in insurance agency commissions and contingency payments. Contingency payments are typically received in the first quarter of each year and are based on the prior year’s performance. The decline in noninterest income during the second quarter of 2010 when compared to the second quarter of 2009 was primarily due to a decline in insurance agency commissions and a $420 thousand gain on an interest rate swap transaction recorded in the second quarter of 2009.
Total noninterest expense for the second quarter of 2010 decreased $633 thousand when compared to the first quarter of 2010 mainly due to lower expenses accrued for bonus and profit sharing plans. When compared to the second quarter of 2009, total noninterest expense for the second quarter of 2010 decreased $1.0 million primarily due to lower expenses accrued for bonus and profit sharing plans and lower FDIC insurance premium expense which were partially offset by higher expenses related to collection and other real estate owned activities. Included in the FDIC insurance premium expense for the second quarter of 2009 was a special one-time assessment of $513 thousand.
Review of Six-Month Financial Results
Net interest income for the first six months of 2010 was $21.1 million, an increase of 4.7% when compared to the first six months of 2009. The increase was primarily due to higher average balances of earning assets and lower rates paid on interest bearing liabilities offsetting the decline in yields on earning assets. The net interest margin increased from 3.96% for the first half of 2009 to 3.99% for the first half of 2010.
The provisions for credit losses for the six months ended June 30, 2010 and 2009 were $12.5 million and $3.6 million, respectively. Net charge-offs were $10.1 million and $2.2 million for the six months ended June 30, 2010 and 2009, respectively. The ratio of year-to-date annualized net charge-offs to average loans was 2.24% for the first half of 2010 and 0.48% for the first half of 2009.
Total noninterest income for the six months ended June 30, 2010 declined $1.2 million when compared to the same period in 2009. As with the second quarter 2010 results, the decrease in noninterest income was mainly due to a decline in insurance agency commissions and a $420 thousand gain on an interest rate swap transaction recorded in the second quarter of 2009.
Total noninterest expense for the six months ended June 30, 2010 decreased $567 thousand when compared to the same period in 2009. Lower expenses accrued for bonus and profit sharing plans and lower FDIC premium insurance expense were partially offset by higher expenses related to collection and other real estate owned activities when compared to the first six months of 2009.
Shore Bancshares Information
Shore Bancshares, Inc. is a financial holding company headquartered in Easton, Maryland and is the largest independent bank holding company located on Maryland’s Eastern Shore. It is the parent company of three banks, The Talbot Bank of Easton, Maryland, CNB, and The Felton Bank; three insurance producer firms, The Avon-Dixon Agency, LLC, Elliott Wilson Insurance, LLC and Jack Martin and Associates, Inc; a wholesale insurance company, TSGIA, Inc; two insurance premium finance companies, Mubell Finance, LLC and ESFS, Inc; and a registered investment adviser firm, Wye Financial Services, LLC. Shore Bancshares, Inc. engages in the mortgage broker business under the name "Wye Mortgage Group" through a minority series investment in an unrelated Delaware limited liability company.
Forward-Looking Statements
This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements do not represent historical facts, but statements about management’s beliefs, plans and objectives. 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. For a discussion of these risks and uncertainties, see the section of the periodic reports filed by Shore Bancshares, Inc. with the Securities and Exchange Commission entitled “Risk Factors”.
Shore Bancshares, Inc. |
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Financial Highlights |
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(Dollars in thousands, except per share data) |
|||||||||||||
For the Three Months Ended |
For the Six Months Ended |
||||||||||||
June 30, |
June 30, |
||||||||||||
2010 |
2009 |
% Change |
2010 |
2009 |
% Change |
||||||||
PROFITABILITY FOR THE PERIOD |
|||||||||||||
Net interest income |
$ 10,691 |
$ 10,086 |
6.0 |
% |
$ 21,086 |
$ 20,144 |
4.7 |
% |
|||||
Provision for credit losses |
4,917 |
1,681 |
192.5 |
12,534 |
3,616 |
246.6 |
|||||||
Noninterest income |
4,568 |
5,347 |
(14.6) |
9,450 |
10,697 |
(11.7) |
|||||||
Noninterest expense |
9,688 |
10,693 |
(9.4) |
20,009 |
20,576 |
(2.8) |
|||||||
Income (loss) before income taxes |
654 |
3,059 |
(78.6) |
(2,007) |
6,649 |
(130.2) |
|||||||
Income tax expense (benefit) |
209 |
1,166 |
(82.1) |
(890) |
2,543 |
(135.0) |
|||||||
Net income (loss) |
445 |
1,893 |
(76.5) |
(1,117) |
4,106 |
(127.2) |
|||||||
Preferred stock dividends and discount accretion |
- |
1,539 |
(100.0) |
- |
1,876 |
(100.0) |
|||||||
Net income (loss) available to common shareholders |
$ 445 |
$ 354 |
25.7 |
$ (1,117) |
$ 2,230 |
(150.1) |
|||||||
Return on average assets (1) |
0.16 |
% |
0.13 |
% |
23.1 |
% |
(0.20) |
% |
0.41 |
% |
(148.8) |
% |
|
Return on average equity (1) |
1.42 |
1.07 |
32.7 |
(1.78) |
3.18 |
(156.0) |
|||||||
Net interest margin |
4.03 |
3.85 |
4.7 |
3.99 |
3.96 |
0.8 |
|||||||
Efficiency ratio - GAAP based |
63.49 |
69.29 |
(8.4) |
65.53 |
66.72 |
(1.8) |
|||||||
PER SHARE DATA |
|||||||||||||
Basic net income (loss) per share |
$ 0.05 |
$ 0.23 |
(78.3) |
% |
$ (0.13) |
$ 0.49 |
(126.5) |
% |
|||||
Basic net income (loss) per common share |
0.05 |
0.04 |
25.0 |
(0.13) |
0.27 |
(148.1) |
|||||||
Diluted net income (loss) per share |
0.05 |
0.22 |
(77.3) |
(0.13) |
0.49 |
(126.5) |
|||||||
Diluted net income (loss) per common share |
0.05 |
0.04 |
25.0 |
(0.13) |
0.27 |
(148.1) |
|||||||
Dividends paid per common share |
0.06 |
0.16 |
(62.5) |
0.12 |
0.32 |
(62.5) |
|||||||
Book value per common share at period end |
14.77 |
15.19 |
(2.8) |
||||||||||
Tangible book value per common share at period end |
12.27 |
12.62 |
(2.8) |
||||||||||
Market value at period end |
11.91 |
17.94 |
(33.6) |
||||||||||
Market range: |
|||||||||||||
High |
14.80 |
21.46 |
(31.0) |
14.80 |
24.43 |
(39.4) |
|||||||
Low |
11.75 |
15.18 |
(22.6) |
10.21 |
11.00 |
(7.2) |
|||||||
PERIOD-END BALANCE SHEET DATA |
|||||||||||||
Loans |
$ 905,477 |
$ 919,088 |
(1.5) |
% |
|||||||||
Securities |
106,556 |
86,123 |
23.7 |
||||||||||
Assets |
1,129,196 |
1,158,212 |
(2.5) |
||||||||||
Deposits |
971,608 |
981,334 |
(1.0) |
||||||||||
Stockholders' equity |
124,666 |
127,876 |
(2.5) |
||||||||||
AVERAGE BALANCE SHEET DATA |
|||||||||||||
Loans |
$ 909,295 |
$ 913,671 |
(0.5) |
% |
$ 909,831 |
$ 906,066 |
0.4 |
% |
|||||
Securities |
109,744 |
83,387 |
31.6 |
109,996 |
83,672 |
31.5 |
|||||||
Earning assets |
1,071,115 |
1,060,886 |
1.0 |
1,073,257 |
1,033,909 |
3.8 |
|||||||
Assets |
1,134,662 |
1,120,338 |
1.3 |
1,140,105 |
1,089,532 |
4.6 |
|||||||
Deposits |
976,749 |
942,431 |
3.6 |
979,491 |
896,311 |
9.3 |
|||||||
Stockholders' equity |
125,670 |
132,607 |
(5.2) |
126,869 |
141,501 |
(10.3) |
|||||||
CAPITAL AND CREDIT QUALITY RATIOS |
|||||||||||||
Average equity to average assets |
11.08 |
% |
11.84 |
% |
11.13 |
% |
12.99 |
% |
|||||
Annualized net charge-offs to average loans |
1.95 |
0.71 |
2.24 |
0.48 |
|||||||||
Allowance for credit losses to period-end loans |
1.47 |
1.17 |
|||||||||||
Nonperforming assets to total loans+other real estate owned |
4.26 |
1.73 |
|||||||||||
Nonperforming assets to total assets |
3.42 |
1.37 |
|||||||||||
Nonperforming assets+Loans 90 days past due |
|||||||||||||
and still accruing to total loans+other real estate owned |
4.78 |
2.60 |
|||||||||||
Nonperforming assets+Loans 90 days past due |
|||||||||||||
and still accruing to total assets |
3.84 |
2.07 |
|||||||||||
(1) Calculation uses net income (loss) available to common shareholders. |
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Shore Bancshares, Inc. |
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Consolidated Balance Sheets |
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(In thousands, except per share data) |
|||||||||||
June 30, 2010 |
June 30, 2010 |
||||||||||
June 30, |
Dec. 31, |
June 30, |
compared to |
compared to |
|||||||
2010 |
2009 |
2009 |
Dec. 31, 2009 |
June 30, 2009 |
|||||||
ASSETS |
|||||||||||
Cash and due from banks |
$ 16,645 |
$ 14,411 |
$ 20,498 |
15.5 |
% |
(18.8) |
% |
||||
Interest-bearing deposits with other banks |
15,652 |
598 |
1,622 |
2,517.4 |
865.0 |
||||||
Federal funds sold |
32,372 |
60,637 |
85,242 |
(46.6) |
(62.0) |
||||||
Investments available-for-sale (at fair value) |
98,211 |
97,595 |
77,129 |
0.6 |
27.3 |
||||||
Investments held-to-maturity |
8,345 |
8,940 |
8,994 |
(6.7) |
(7.2) |
||||||
Loans |
905,477 |
916,557 |
919,088 |
(1.2) |
(1.5) |
||||||
Less: allowance for credit losses |
(13,289) |
(10,876) |
(10,784) |
22.2 |
23.2 |
||||||
Loans, net |
892,188 |
905,681 |
908,304 |
(1.5) |
(1.8) |
||||||
Premises and equipment, net |
14,924 |
14,307 |
14,018 |
4.3 |
6.5 |
||||||
Goodwill |
15,954 |
15,954 |
15,954 |
- |
- |
||||||
Other intangible assets, net |
5,148 |
5,406 |
5,663 |
(4.8) |
(9.1) |
||||||
Other real estate and other assets owned, net |
1,428 |
2,572 |
2,212 |
(44.5) |
(35.4) |
||||||
Other assets |
28,329 |
30,415 |
18,576 |
(6.9) |
52.5 |
||||||
Total assets |
$ 1,129,196 |
$ 1,156,516 |
$ 1,158,212 |
(2.4) |
(2.5) |
||||||
LIABILITIES |
|||||||||||
Noninterest-bearing deposits |
$ 121,410 |
$ 122,492 |
$ 113,111 |
(0.9) |
7.3 |
||||||
Interest-bearing deposits |
850,198 |
868,445 |
868,223 |
(2.1) |
(2.1) |
||||||
Total deposits |
971,608 |
990,937 |
981,334 |
(2.0) |
(1.0) |
||||||
Short-term borrowings |
17,864 |
20,404 |
28,096 |
(12.4) |
(36.4) |
||||||
Accrued expenses and other liabilities |
13,629 |
15,936 |
12,959 |
(14.5) |
5.2 |
||||||
Long-term debt |
1,429 |
1,429 |
7,947 |
- |
(82.0) |
||||||
Total liabilities |
1,004,530 |
1,028,706 |
1,030,336 |
(2.4) |
(2.5) |
||||||
STOCKHOLDERS' EQUITY |
|||||||||||
Common stock, par value $0.01; authorized |
|||||||||||
35,000,000 shares |
84 |
84 |
84 |
- |
- |
||||||
Warrant |
1,543 |
1,543 |
1,543 |
- |
- |
||||||
Additional paid in capital |
30,081 |
29,872 |
29,816 |
0.7 |
0.9 |
||||||
Retained earnings |
94,021 |
96,151 |
95,679 |
(2.2) |
(1.7) |
||||||
Accumulated other comprehensive (loss) income |
(1,063) |
160 |
754 |
(764.4) |
(241.0) |
||||||
Total stockholders' equity |
124,666 |
127,810 |
127,876 |
(2.5) |
(2.5) |
||||||
Total liabilities and stockholders' equity |
$ 1,129,196 |
$ 1,156,516 |
$ 1,158,212 |
(2.4) |
(2.5) |
||||||
Period-end common shares outstanding |
8,443 |
8,419 |
8,419 |
0.3 |
0.3 |
||||||
Book value per common share |
$ 14.77 |
$ 15.18 |
$ 15.19 |
(2.7) |
(2.8) |
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Shore Bancshares, Inc. |
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Consolidated Statements of Income |
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(In thousands, except per share data) |
|||||||||||
For the Three Months Ended |
For the Six Months Ended |
||||||||||
June 30, |
June 30, |
||||||||||
2010 |
2009 |
% Change |
2010 |
2009 |
% Change |
||||||
INTEREST INCOME |
|||||||||||
Interest and fees on loans |
$ 13,047 |
$ 13,754 |
(5.1) |
% |
$ 25,921 |
$ 27,371 |
(5.3) |
% |
|||
Interest and dividends on investment securities: |
|||||||||||
Taxable |
846 |
768 |
10.2 |
1,728 |
1,524 |
13.4 |
|||||
Tax-exempt |
56 |
79 |
(29.1) |
115 |
164 |
(29.9) |
|||||
Interest on federal funds sold |
14 |
23 |
(39.1) |
26 |
30 |
(13.3) |
|||||
Interest on deposits with other banks |
4 |
6 |
(33.3) |
5 |
7 |
(28.6) |
|||||
Total interest income |
13,967 |
14,630 |
(4.5) |
27,795 |
29,096 |
(4.5) |
|||||
INTEREST EXPENSE |
|||||||||||
Interest on deposits |
3,242 |
4,441 |
(27.0) |
6,627 |
8,726 |
(24.1) |
|||||
Interest on short-term borrowings |
19 |
28 |
(32.1) |
51 |
77 |
(33.8) |
|||||
Interest on long-term debt |
15 |
75 |
(80.0) |
31 |
149 |
(79.2) |
|||||
Total interest expense |
3,276 |
4,544 |
(27.9) |
6,709 |
8,952 |
(25.1) |
|||||
NET INTEREST INCOME |
10,691 |
10,086 |
6.0 |
21,086 |
20,144 |
4.7 |
|||||
Provision for credit losses |
4,917 |
1,681 |
192.5 |
12,534 |
3,616 |
246.6 |
|||||
NET INTEREST INCOME AFTER PROVISION |
|||||||||||
FOR CREDIT LOSSES |
5,774 |
8,405 |
(31.3) |
8,552 |
16,528 |
(48.3) |
|||||
NONINTEREST INCOME |
|||||||||||
Service charges on deposit accounts |
831 |
888 |
(6.4) |
1,617 |
1,697 |
(4.7) |
|||||
Trust and investment fee income |
372 |
258 |
44.2 |
788 |
476 |
65.5 |
|||||
Investment securities gains (losses) |
- |
- |
- |
- |
49 |
(100.0) |
|||||
Insurance agency commissions |
2,595 |
2,893 |
(10.3) |
5,484 |
6,228 |
(11.9) |
|||||
Other noninterest income |
770 |
1,308 |
(41.1) |
1,561 |
2,247 |
(30.5) |
|||||
Total noninterest income |
4,568 |
5,347 |
(14.6) |
9,450 |
10,697 |
(11.7) |
|||||
NONINTEREST EXPENSE |
|||||||||||
Salaries and wages |
4,363 |
4,759 |
(8.3) |
8,853 |
9,299 |
(4.8) |
|||||
Employee benefits |
758 |
1,200 |
(36.8) |
2,039 |
2,580 |
(21.0) |
|||||
Occupancy expense |
597 |
587 |
1.7 |
1,219 |
1,136 |
7.3 |
|||||
Furniture and equipment expense |
313 |
302 |
3.6 |
613 |
616 |
(0.5) |
|||||
Data processing |
660 |
580 |
13.8 |
1,291 |
1,190 |
8.5 |
|||||
Directors' fees |
105 |
117 |
(10.3) |
226 |
285 |
(20.7) |
|||||
Amortization of intangible assets |
129 |
129 |
- |
258 |
258 |
- |
|||||
Insurance agency commissions expense |
464 |
537 |
(13.6) |
892 |
1,087 |
(17.9) |
|||||
FDIC insurance premium expense |
460 |
919 |
(49.9) |
941 |
1,163 |
(19.1) |
|||||
Other noninterest expenses |
1,839 |
1,563 |
17.7 |
3,677 |
2,962 |
24.1 |
|||||
Total noninterest expense |
9,688 |
10,693 |
(9.4) |
20,009 |
20,576 |
(2.8) |
|||||
Income (loss) before income taxes |
654 |
3,059 |
(78.6) |
(2,007) |
6,649 |
(130.2) |
|||||
Income tax expense (benefit) |
209 |
1,166 |
(82.1) |
(890) |
2,543 |
(135.0) |
|||||
NET INCOME (LOSS) |
445 |
1,893 |
(76.5) |
(1,117) |
4,106 |
(127.2) |
|||||
Preferred stock dividends and discount accretion |
- |
1,539 |
(100.0) |
- |
1,876 |
(100.0) |
|||||
Net income (loss) available to common shareholders |
$ 445 |
$ 354 |
25.7 |
$ (1,117) |
$ 2,230 |
(150.1) |
|||||
Weighted average shares outstanding - basic |
8,443 |
8,413 |
0.4 |
8,440 |
8,409 |
0.4 |
|||||
Weighted average shares outstanding - diluted |
8,443 |
8,417 |
0.3 |
8,440 |
8,413 |
0.3 |
|||||
Basic net income (loss) per share |
$ 0.05 |
$ 0.23 |
(78.3) |
$ (0.13) |
$ 0.49 |
(126.5) |
|||||
Basic net income (loss) per common share |
0.05 |
0.04 |
25.0 |
(0.13) |
0.27 |
(148.1) |
|||||
Diluted net income (loss) per share |
0.05 |
0.22 |
(77.3) |
(0.13) |
0.49 |
(126.5) |
|||||
Diluted net income (loss) per common share |
0.05 |
0.04 |
25.0 |
(0.13) |
0.27 |
(148.1) |
|||||
Dividends paid per common share |
0.06 |
0.16 |
(62.5) |
0.12 |
0.32 |
(62.5) |
|||||
Shore Bancshares, Inc. |
|||||||||||||||||
Consolidated Average Balance Sheets |
|||||||||||||||||
(Dollars in thousands) |
|||||||||||||||||
For the Three Months Ended |
For the Six Months Ended |
||||||||||||||||
June 30, |
June 30, |
||||||||||||||||
2010 |
2009 |
2010 |
2009 |
||||||||||||||
Average |
Yield/ |
Average |
Yield/ |
Average |
Yield/ |
Average |
Yield/ |
||||||||||
balance |
rate |
balance |
rate |
balance |
rate |
balance |
rate |
||||||||||
Earning assets |
|||||||||||||||||
Loans |
$ 909,295 |
5.77 |
% |
$ 913,671 |
6.06 |
% |
$ 909,831 |
5.76 |
% |
$ 906,066 |
6.11 |
% |
|||||
Investment securities |
|||||||||||||||||
Taxable |
103,284 |
3.29 |
75,277 |
4.09 |
103,385 |
3.37 |
75,067 |
4.09 |
|||||||||
Tax-exempt |
6,460 |
5.30 |
8,110 |
6.02 |
6,611 |
5.35 |
8,605 |
5.92 |
|||||||||
Federal funds sold |
38,001 |
0.15 |
55,699 |
0.16 |
42,253 |
0.13 |
38,873 |
0.15 |
|||||||||
Interest-bearing deposits |
14,075 |
0.12 |
8,129 |
0.33 |
11,177 |
0.10 |
5,298 |
0.28 |
|||||||||
Total earning assets |
1,071,115 |
5.26 |
% |
1,060,886 |
5.56 |
% |
1,073,257 |
5.25 |
% |
1,033,909 |
5.71 |
% |
|||||
Cash and due from banks |
9,997 |
18,705 |
12,197 |
15,395 |
|||||||||||||
Other assets |
67,860 |
51,595 |
67,889 |
50,487 |
|||||||||||||
Allowance for credit losses |
(14,310) |
(10,848) |
(13,238) |
(10,259) |
|||||||||||||
Total assets |
$ 1,134,662 |
$ 1,120,338 |
$ 1,140,105 |
$ 1,089,532 |
|||||||||||||
Interest bearing liabilities |
|||||||||||||||||
Demand deposits |
$ 132,563 |
0.25 |
% |
$ 125,076 |
0.24 |
% |
$ 130,287 |
0.25 |
% |
$ 123,104 |
0.24 |
% |
|||||
Money market and savings deposits |
259,273 |
0.72 |
222,825 |
0.63 |
258,180 |
0.70 |
188,165 |
0.56 |
|||||||||
Certificates of deposit $100,000 or more |
251,340 |
2.09 |
245,210 |
3.20 |
255,416 |
2.17 |
241,997 |
3.30 |
|||||||||
Other time deposits |
215,987 |
2.56 |
239,668 |
3.45 |
217,849 |
2.62 |
236,077 |
3.50 |
|||||||||
Interest bearing deposits |
859,163 |
1.51 |
832,779 |
2.14 |
861,732 |
1.55 |
789,343 |
2.23 |
|||||||||
Short-term borrowings |
15,771 |
0.48 |
25,435 |
0.45 |
16,896 |
0.60 |
32,469 |
0.48 |
|||||||||
Long-term debt |
1,429 |
4.40 |
7,947 |
3.78 |
1,429 |
4.43 |
7,947 |
3.78 |
|||||||||
Total interest bearing liabilities |
876,363 |
1.50 |
% |
866,161 |
2.10 |
% |
880,057 |
1.54 |
% |
829,759 |
2.18 |
% |
|||||
Noninterest bearing deposits |
117,586 |
109,652 |
117,759 |
106,968 |
|||||||||||||
Accrued expenses and other liabilities |
15,043 |
11,918 |
15,420 |
11,304 |
|||||||||||||
Stockholders' equity |
125,670 |
132,607 |
126,869 |
141,501 |
|||||||||||||
Total liabilities and stockholders' equity |
$ 1,134,662 |
$ 1,120,338 |
$ 1,140,105 |
$ 1,089,532 |
|||||||||||||
Net interest spread |
3.76 |
% |
3.46 |
% |
3.71 |
% |
3.53 |
% |
|||||||||
Net interest margin |
4.03 |
% |
3.85 |
% |
3.99 |
% |
3.96 |
% |
|||||||||
Shore Bancshares, Inc. |
|||||||||||||||
Financial Highlights By Quarter |
|||||||||||||||
(Dollars in thousands, except per share data) |
|||||||||||||||
2nd quarter |
1st quarter |
4th quarter |
3rd quarter |
2nd quarter |
2Q 10 |
2Q 10 |
|||||||||
2010 |
2010 |
2009 |
2009 |
2009 |
compared to |
compared to |
|||||||||
(2Q 10) |
(1Q 10) |
(4Q 09) |
(3Q 09) |
(2Q 09) |
1Q 10 |
2Q 09 |
|||||||||
PROFITABILITY FOR THE PERIOD |
|||||||||||||||
Net interest income |
$ 10,691 |
$ 10,395 |
$ 10,806 |
$ 10,428 |
$ 10,086 |
2.8 |
% |
6.0 |
% |
||||||
Provision for credit losses |
4,917 |
7,617 |
3,668 |
1,702 |
1,681 |
(35.4) |
192.5 |
||||||||
Noninterest income |
4,568 |
4,882 |
4,125 |
4,719 |
5,347 |
(6.4) |
(14.6) |
||||||||
Noninterest expense |
9,688 |
10,321 |
9,375 |
10,297 |
10,693 |
(6.1) |
(9.4) |
||||||||
Income (loss) before income taxes |
654 |
(2,661) |
1,888 |
3,148 |
3,059 |
124.6 |
(78.6) |
||||||||
Income tax expense (benefit) |
209 |
(1,099) |
672 |
1,197 |
1,166 |
119.0 |
(82.1) |
||||||||
Net income (loss) |
445 |
(1,562) |
1,216 |
1,951 |
1,893 |
128.5 |
(76.5) |
||||||||
Preferred stock dividends and discount accretion |
- |
- |
- |
- |
1,539 |
- |
(100.0) |
||||||||
Net income (loss) available to common shareholders |
$ 445 |
$ (1,562) |
$ 1,216 |
$ 1,951 |
$ 354 |
128.5 |
25.7 |
||||||||
Return on average assets (1) |
0.16 |
% |
(0.55) |
% |
0.41 |
% |
0.66 |
% |
0.13 |
% |
129.1 |
% |
23.1 |
% |
|
Return on average equity (1) |
1.42 |
(4.95) |
3.75 |
6.03 |
1.07 |
128.7 |
32.7 |
||||||||
Net interest margin |
4.03 |
3.95 |
3.90 |
3.79 |
3.85 |
2.0 |
4.7 |
||||||||
Efficiency ratio - GAAP based |
63.49 |
67.56 |
62.79 |
67.98 |
69.29 |
(6.0) |
(8.4) |
||||||||
PER SHARE DATA |
|||||||||||||||
Basic net income (loss) per share |
$ 0.05 |
$ (0.19) |
$ 0.14 |
$ 0.23 |
$ 0.23 |
126.3 |
% |
(78.3) |
% |
||||||
Basic net income (loss) per common share |
0.05 |
(0.19) |
0.14 |
0.23 |
0.04 |
126.3 |
25.0 |
||||||||
Diluted net income (loss) per share |
0.05 |
(0.19) |
0.14 |
0.23 |
0.22 |
126.3 |
(77.3) |
||||||||
Diluted net income (loss) per common share |
0.05 |
(0.19) |
0.14 |
0.23 |
0.04 |
126.3 |
25.0 |
||||||||
Dividends paid per common share |
0.06 |
0.06 |
0.16 |
0.16 |
0.16 |
- |
(62.5) |
||||||||
Book value per common share at period end |
14.77 |
14.82 |
15.18 |
15.23 |
15.19 |
(0.3) |
(2.8) |
||||||||
Tangible book value per common share at period end |
12.27 |
12.30 |
12.64 |
12.68 |
12.62 |
(0.2) |
(2.8) |
||||||||
Market value at period end |
11.91 |
14.25 |
14.50 |
16.73 |
17.94 |
(16.4) |
(33.6) |
||||||||
Market range: |
|||||||||||||||
High |
14.80 |
14.75 |
17.71 |
20.72 |
21.46 |
0.3 |
(31.0) |
||||||||
Low |
11.75 |
10.21 |
13.52 |
16.64 |
15.18 |
15.1 |
(22.6) |
||||||||
PERIOD-END BALANCE SHEET DATA |
|||||||||||||||
Loans |
$ 905,477 |
$ 905,194 |
$ 916,557 |
$ 918,601 |
$ 919,088 |
- |
% |
(1.5) |
% |
||||||
Securities |
106,556 |
112,929 |
106,535 |
100,772 |
86,123 |
(5.6) |
23.7 |
||||||||
Assets |
1,129,196 |
1,146,334 |
1,156,516 |
1,157,685 |
1,158,212 |
(1.5) |
(2.5) |
||||||||
Deposits |
971,608 |
990,750 |
990,937 |
992,196 |
981,334 |
(1.9) |
(1.0) |
||||||||
Stockholders' equity |
124,666 |
125,108 |
127,810 |
128,219 |
127,876 |
(0.4) |
(2.5) |
||||||||
AVERAGE BALANCE SHEET DATA |
|||||||||||||||
Loans |
$ 909,295 |
$ 910,374 |
$ 921,908 |
$ 920,241 |
$ 913,671 |
(0.1) |
% |
(0.5) |
% |
||||||
Securities |
109,744 |
110,252 |
104,561 |
97,226 |
83,387 |
(0.5) |
31.6 |
||||||||
Earning assets |
1,071,115 |
1,075,425 |
1,104,919 |
1,100,538 |
1,060,886 |
(0.4) |
1.0 |
||||||||
Assets |
1,134,662 |
1,145,607 |
1,169,337 |
1,166,587 |
1,120,338 |
(1.0) |
1.3 |
||||||||
Deposits |
976,749 |
982,265 |
1,002,982 |
1,001,304 |
942,431 |
(0.6) |
3.6 |
||||||||
Stockholders' equity |
125,670 |
128,081 |
128,715 |
128,409 |
132,607 |
(1.9) |
(5.2) |
||||||||
CAPITAL AND CREDIT QUALITY RATIOS |
|||||||||||||||
Average equity to average assets |
11.08 |
% |
11.18 |
% |
11.01 |
% |
11.01 |
% |
11.84 |
% |
|||||
Annualized net charge-offs to average loans |
1.95 |
2.54 |
1.51 |
0.76 |
0.71 |
||||||||||
Allowance for credit losses to period-end loans |
1.47 |
1.41 |
1.19 |
1.17 |
1.17 |
||||||||||
Nonperforming assets to total loans+other real estate owned |
4.26 |
3.62 |
2.05 |
1.90 |
1.73 |
||||||||||
Nonperforming assets to total assets |
3.42 |
2.87 |
1.63 |
1.51 |
1.37 |
||||||||||
Nonperforming assets+Loans 90 days past due |
|||||||||||||||
and still accruing to total loans+other real estate owned |
4.78 |
3.93 |
2.86 |
2.89 |
2.60 |
||||||||||
Nonperforming assets+Loans 90 days past due |
|||||||||||||||
and still accruing to total assets |
3.84 |
3.11 |
2.27 |
2.30 |
2.07 |
||||||||||
(1) Calculation uses net income (loss) available to common shareholders. |
|||||||||||||||
Shore Bancshares, Inc. |
|||||||||||||||
Consolidated Statements of Income By Quarter |
|||||||||||||||
(In thousands, except per share data) |
|||||||||||||||
2Q 10 |
2Q 10 |
||||||||||||||
compared to |
compared to |
||||||||||||||
2Q 10 |
1Q 10 |
4Q 09 |
3Q 09 |
2Q 09 |
1Q 10 |
2Q 09 |
|||||||||
INTEREST INCOME |
|||||||||||||||
Interest and fees on loans |
$ 13,047 |
$ 12,874 |
$ 13,837 |
$ 14,001 |
$ 13,754 |
1.3 |
% |
(5.1) |
% |
||||||
Interest and dividends on investment securities: |
|||||||||||||||
Taxable |
846 |
882 |
860 |
800 |
768 |
(4.1) |
10.2 |
||||||||
Tax-exempt |
56 |
59 |
60 |
77 |
79 |
(5.1) |
(29.1) |
||||||||
Interest on federal funds sold |
14 |
12 |
23 |
31 |
23 |
16.7 |
(39.1) |
||||||||
Interest on deposits with other banks |
4 |
1 |
- |
4 |
6 |
300.0 |
(33.3) |
||||||||
Total interest income |
13,967 |
13,828 |
14,780 |
14,913 |
14,630 |
1.0 |
(4.5) |
||||||||
INTEREST EXPENSE |
|||||||||||||||
Interest on deposits |
3,242 |
3,385 |
3,924 |
4,368 |
4,441 |
(4.2) |
(27.0) |
||||||||
Interest on short-term borrowings |
19 |
32 |
31 |
19 |
28 |
(40.6) |
(32.1) |
||||||||
Interest on long-term debt |
15 |
16 |
19 |
98 |
75 |
(6.3) |
(80.0) |
||||||||
Total interest expense |
3,276 |
3,433 |
3,974 |
4,485 |
4,544 |
(4.6) |
(27.9) |
||||||||
NET INTEREST INCOME |
10,691 |
10,395 |
10,806 |
10,428 |
10,086 |
2.8 |
6.0 |
||||||||
Provision for credit losses |
4,917 |
7,617 |
3,668 |
1,702 |
1,681 |
(35.4) |
192.5 |
||||||||
NET INTEREST INCOME AFTER PROVISION |
|||||||||||||||
FOR CREDIT LOSSES |
5,774 |
2,778 |
7,138 |
8,726 |
8,405 |
107.8 |
(31.3) |
||||||||
NONINTEREST INCOME |
|||||||||||||||
Service charges on deposit accounts |
831 |
786 |
866 |
861 |
888 |
5.7 |
(6.4) |
||||||||
Trust and investment fee income |
372 |
416 |
350 |
274 |
258 |
(10.6) |
44.2 |
||||||||
Investment securities gains (losses) |
- |
- |
- |
- |
- |
- |
- |
||||||||
Insurance agency commissions |
2,595 |
2,889 |
2,159 |
2,744 |
2,893 |
(10.2) |
(10.3) |
||||||||
Other noninterest income |
770 |
791 |
750 |
840 |
1,308 |
(2.7) |
(41.1) |
||||||||
Total noninterest income |
4,568 |
4,882 |
4,125 |
4,719 |
5,347 |
(6.4) |
(14.6) |
||||||||
NONINTEREST EXPENSE |
|||||||||||||||
Salaries and wages |
4,363 |
4,490 |
4,424 |
4,765 |
4,759 |
(2.8) |
(8.3) |
||||||||
Employee benefits |
758 |
1,281 |
840 |
1,211 |
1,200 |
(40.8) |
(36.8) |
||||||||
Occupancy expense |
597 |
622 |
572 |
616 |
587 |
(4.0) |
1.7 |
||||||||
Furniture and equipment expense |
313 |
300 |
268 |
299 |
302 |
4.3 |
3.6 |
||||||||
Data processing |
660 |
631 |
598 |
675 |
580 |
4.6 |
13.8 |
||||||||
Directors' fees |
105 |
121 |
84 |
109 |
117 |
(13.2) |
(10.3) |
||||||||
Amortization of intangible assets |
129 |
129 |
129 |
128 |
129 |
- |
- |
||||||||
Insurance agency commissions expense |
464 |
428 |
398 |
428 |
537 |
8.4 |
(13.6) |
||||||||
FDIC insurance premium expense |
460 |
481 |
457 |
458 |
919 |
(4.4) |
(49.9) |
||||||||
Other noninterest expenses |
1,839 |
1,838 |
1,605 |
1,608 |
1,563 |
0.1 |
17.7 |
||||||||
Total noninterest expense |
9,688 |
10,321 |
9,375 |
10,297 |
10,693 |
(6.1) |
(9.4) |
||||||||
Income (loss) before income taxes |
654 |
(2,661) |
1,888 |
3,148 |
3,059 |
124.6 |
(78.6) |
||||||||
Income tax expense (benefit) |
209 |
(1,099) |
672 |
1,197 |
1,166 |
119.0 |
(82.1) |
||||||||
NET INCOME (LOSS) |
445 |
(1,562) |
1,216 |
1,951 |
1,893 |
128.5 |
(76.5) |
||||||||
Preferred stock dividends and discount accretion |
- |
- |
- |
- |
1,539 |
- |
(100.0) |
||||||||
Net income (loss) available to common shareholders |
$ 445 |
$ (1,562) |
$ 1,216 |
$ 1,951 |
$ 354 |
128.5 |
25.7 |
||||||||
Weighted average shares outstanding - basic |
8,443 |
8,436 |
8,419 |
8,419 |
8,413 |
0.1 |
0.4 |
||||||||
Weighted average shares outstanding - diluted |
8,443 |
8,436 |
8,421 |
8,423 |
8,417 |
0.1 |
0.3 |
||||||||
Basic net income (loss) per share |
$ 0.05 |
$ (0.19) |
$ 0.14 |
$ 0.23 |
$ 0.23 |
126.3 |
(78.3) |
||||||||
Basic net income (loss) per common share |
0.05 |
(0.19) |
0.14 |
0.23 |
0.04 |
126.3 |
25.0 |
||||||||
Diluted net income (loss) per share |
0.05 |
(0.19) |
0.14 |
0.23 |
0.22 |
126.3 |
(77.3) |
||||||||
Diluted net income (loss) per common share |
0.05 |
(0.19) |
0.14 |
0.23 |
0.04 |
126.3 |
25.0 |
||||||||
Dividends paid per common share |
0.06 |
0.06 |
0.16 |
0.16 |
0.16 |
- |
(62.5) |
||||||||
Shore Bancshares, Inc. |
|||||||||||||||||||||||||
Consolidated Average Balance Sheets By Quarter |
|||||||||||||||||||||||||
(Dollars in thousands) |
|||||||||||||||||||||||||
Average balance |
|||||||||||||||||||||||||
2Q 10 |
2Q 10 |
||||||||||||||||||||||||
compared to |
compared to |
||||||||||||||||||||||||
2Q 10 |
1Q 10 |
4Q 09 |
3Q 09 |
2Q 09 |
1Q 10 |
2Q 09 |
|||||||||||||||||||
Average |
Yield/ |
Average |
Yield/ |
Average |
Yield/ |
Average |
Yield/ |
Average |
Yield/ |
||||||||||||||||
balance |
rate |
balance |
rate |
balance |
rate |
balance |
rate |
balance |
rate |
||||||||||||||||
Earning assets |
|||||||||||||||||||||||||
Loans |
$ 909,295 |
5.77 |
% |
$ 910,374 |
5.75 |
% |
$ 921,908 |
5.97 |
% |
$ 920,241 |
6.05 |
% |
$ 913,671 |
6.06 |
% |
(0.1) |
% |
(0.5) |
% |
||||||
Investment securities |
|||||||||||||||||||||||||
Taxable |
103,284 |
3.29 |
103,488 |
3.45 |
97,595 |
3.50 |
89,101 |
3.56 |
75,277 |
4.09 |
(0.2) |
37.2 |
|||||||||||||
Tax-exempt |
6,460 |
5.30 |
6,764 |
5.39 |
6,966 |
4.96 |
8,125 |
5.76 |
8,110 |
6.02 |
(4.5) |
(20.4) |
|||||||||||||
Federal funds sold |
38,001 |
0.15 |
46,553 |
0.11 |
77,782 |
0.11 |
81,466 |
0.16 |
55,699 |
0.16 |
(18.4) |
(31.8) |
|||||||||||||
Interest-bearing deposits |
14,075 |
0.12 |
8,246 |
0.06 |
668 |
0.45 |
1,605 |
0.77 |
8,129 |
0.33 |
70.7 |
73.2 |
|||||||||||||
Total earning assets |
1,071,115 |
5.26 |
% |
1,075,425 |
5.24 |
% |
1,104,919 |
5.33 |
% |
1,100,538 |
5.41 |
% |
1,060,886 |
5.56 |
% |
(0.4) |
1.0 |
||||||||
Cash and due from banks |
9,997 |
14,422 |
17,312 |
20,042 |
18,705 |
(30.7) |
(46.6) |
||||||||||||||||||
Other assets |
67,860 |
67,914 |
58,543 |
57,049 |
51,595 |
(0.1) |
31.5 |
||||||||||||||||||
Allowance for credit losses |
(14,310) |
(12,154) |
(11,437) |
(11,042) |
(10,848) |
17.7 |
31.9 |
||||||||||||||||||
Total assets |
$ 1,134,662 |
$ 1,145,607 |
$ 1,169,337 |
$ 1,166,587 |
$ 1,120,338 |
(1.0) |
1.3 |
||||||||||||||||||
Interest bearing liabilities |
|||||||||||||||||||||||||
Demand deposits |
$ 132,563 |
0.25 |
% |
$ 127,986 |
0.25 |
% |
$ 127,537 |
0.26 |
% |
$ 125,233 |
0.26 |
% |
$ 125,076 |
0.24 |
% |
3.6 |
6.0 |
||||||||
Money market and savings deposits |
259,273 |
0.72 |
256,818 |
0.68 |
249,393 |
0.66 |
245,801 |
0.67 |
222,825 |
0.63 |
1.0 |
16.4 |
|||||||||||||
Certificates of deposit $100,000 or more |
251,340 |
2.09 |
259,538 |
2.24 |
276,390 |
2.51 |
274,580 |
2.82 |
245,210 |
3.20 |
(3.2) |
2.5 |
|||||||||||||
Other time deposits |
215,987 |
2.56 |
219,731 |
2.67 |
228,020 |
2.91 |
237,757 |
3.20 |
239,668 |
3.45 |
(1.7) |
(9.9) |
|||||||||||||
Interest bearing deposits |
859,163 |
1.51 |
864,073 |
1.59 |
881,340 |
1.77 |
883,371 |
1.96 |
832,779 |
2.14 |
(0.6) |
3.2 |
|||||||||||||
Short-term borrowings |
15,771 |
0.48 |
18,032 |
0.71 |
18,994 |
0.63 |
18,373 |
0.42 |
25,435 |
0.45 |
(12.5) |
(38.0) |
|||||||||||||
Long-term debt |
1,429 |
4.40 |
1,429 |
4.45 |
1,429 |
5.28 |
1,947 |
19.90 |
7,947 |
3.78 |
- |
(82.0) |
|||||||||||||
Total interest bearing liabilities |
876,363 |
1.50 |
% |
883,534 |
1.58 |
% |
901,763 |
1.75 |
% |
903,691 |
1.97 |
% |
866,161 |
2.10 |
% |
(0.8) |
1.2 |
||||||||
Noninterest bearing deposits |
117,586 |
118,192 |
121,642 |
117,933 |
109,652 |
(0.5) |
7.2 |
||||||||||||||||||
Accrued expenses and other liabilities |
15,043 |
15,800 |
17,217 |
16,554 |
11,918 |
(4.8) |
26.2 |
||||||||||||||||||
Stockholders' equity |
125,670 |
128,081 |
128,715 |
128,409 |
132,607 |
(1.9) |
(5.2) |
||||||||||||||||||
Total liabilities and stockholders' equity |
$ 1,134,662 |
$ 1,145,607 |
$ 1,169,337 |
$ 1,166,587 |
$ 1,120,338 |
(1.0) |
1.3 |
||||||||||||||||||
Net interest spread |
3.76 |
% |
3.66 |
% |
3.58 |
% |
3.44 |
% |
3.46 |
% |
|||||||||||||||
Net interest margin |
4.03 |
% |
3.95 |
% |
3.90 |
% |
3.79 |
% |
3.85 |
% |
|||||||||||||||
SOURCE Shore Bancshares, Inc.
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