Shore Bancshares, Inc. · NASDAQ:SHBI
Shore Bancshares — Investor Presentation (September 2021)
26 slides from Shore Bancshares's investor presentation, Sep 13, 2021
Slide 1: Investor Presentation September 2021
1 Investor Presentation September 2021
Slide 2: Forward-Looking Statements
2 This investor presentation contains future oral and written statements of Shore Bancshares, Inc. (the “Company” or “SHBI”) an d i ts wholly - owned banking subsidiary, Shore United Bank (the “Bank”), and its management, which may contain statements about future events that constitute forward - loo
Slide 3: Management Team
3 Management Team * Reference Appendix section for biographies Name Title/Function Entity Years in Banking Years with Company Lloyd L. “Scott” Beatty, Jr. President and Chief Executive Officer SHBI, Bank 29 15 Edward C. Allen EVP and Chief Financial Officer SHBI, Bank 43 10 Donna J. Stevens EVP and
Slide 4: Financial Summary and Key Ratios
4 Financial Summary and Key Ratios Financial Ratio 12/31/20 YTD Ann. 6/30/21 Return on Average Assets (1) 0.92% 0.84% Return on Average Equity (1) 7.95% 8.45% Net Interest Margin 3.27% 2.96% Non - interest Income/Average Assets (2) 0.63% 0.54% Non - interest Expense/Average Assets (1),(2) 2.25% 2.08
Slide 5: Locations
5 Locations SHORE BANCSHARES Headquarters 18 E. Dover St. Easton, MD 21601 BANKING Shore United Bank 18 E. Dover St. Easton, MD 21601 877.758.1600 ShoreUnitedBank.com LOAN PRODUCTION OFFICES Shore United Bank 102 Sleepy Hollow Drive, Suite 204 Middletown, DE 19709 9748 Stephen Decatur Highway, U
Slide 6: Strategic Direction
6 Strategic Direction Market Expansion LPO’s and Strategic Branching – New Ocean City branch announced Acquire Banks Contiguous to our Existing Markets – Severn Bancorp merger Leverage Back Office Capability Additions to Staff Have Been Primarily Production Operating Strategy Drive Pro
Slide 7: Severn Merger Status
7 Severn Merger Status ▪ Received approval for Holding Company Merger from the Federal Reserve ▪ Received letter of Non - Review of our Registration Statement from the SEC ▪ Pre - Merge/Pre - Conversion Exam Completed by the OCC on September 3 rd ▪ Anticipated OCC approval by September 30 th ▪ Key D
Slide 8: Market Rank, Share and Highlights
8 Maryland Rank Share Branches Talbot 1 46.25% 4 Queen Anne’s 2 27.23% 5 Caroline 3 19.39% 2 Kent 4 10.02% 1 Dorchester 7 5.60% 1 Worcester 11 1.25% 1 Howard 14 0.45% 1 Baltimore 17 0.82% 2 Delaware Rank Share Branches Kent 6 4.74% 4 Virginia Accomack 6 1.76% 1 Selected SHBI Market Highlights 2021
Slide 9: Deposit Market Rank and Share
9 Market Rank Local Rank Ticker Company Name City (HQ) HQ State Branches 2021 Total Deposits 2021 ($000) ’21 Market Share (%) 1 – BAC Bank of America Corp. Charlotte NC 53 11,989,494 18.3% 2 – MTB M&T Bank Corp. Buffalo NY 71 11,273,996 17.2% 3 – TFC Truist Financial Corp. Charlotte NC 62 8,086,925
Slide 10: Recent Developments: Paycheck Protection Program
10 Recent Developments PAYCHECK PROTECTION PROGRAM (PPP) Shore United Bank team responded quickly to identify impacted customers As of June 30, 2021, 2,454 loans were processed and funded for $196.3 million 27% of loans to new customers; $ 49.0 million funded. As of June 30, 2021, 1,260 loan
Slide 11: Targeted, Organic Balance Sheet Growth
11 Total Deposits ($M) Total Assets ($M) Total Gross Loans Held for Investment ($M) NCOs / Avg. Loans Targeted, Organic Balance Sheet Growth 1) Core deposits defined as total deposits less total CDs >$250,000 and brokered deposits (as of June 30, 2021) Source: S&P Global Market Intelligence; Company
Slide 12: Strong, Consistent Historical Profitability
12 Net Income from Continuing Operations ($M) ROAE from Continuing Operations ROAA from Continuing Operations NIM (FTE) Strong, Consistent Historical Profitability Note: 2021Q2 metrics are YTD; Yellow dotted lines in 2018 denote results including proceeds received from sale on insurance s ubs idiary
Slide 13: Income Statement (Quarterly)
13 Income Statement (Quarterly) Dollar Value in Thousands 12/31/2019 12/31/2020 3/31/2021 6/30/2021 Interest and Fees on Loans $14,043 $14,541 $14,366 $14,381 Other Interest Income 1,122 954 978 1,150 Interest Income 15,165 15,495 15,344 15,531 Interest on Deposits 2,287 1,355 1,184 1,056 Interest o
Slide 14: Loan Modifications by Industry
14 Dollar Value in Thousands Total Loan Balance as of 6/30/2021 Total Loans Modified as of 6/30/2021 Loans Modified to Interest Only Payments (6 months or less) Loans Modified to Payment Deferral (3 months) Percentage of Loans Modified Hospitality Industry $108,823,219 $9,526,194 $9,526,194 -- 8.75%
Slide 15: Loan Portfolio
15 (Dollar Value in Thousands) As of June 30, 2021 Loan Type Balance % of Total Construction $116,760 7.9% 1 - 4 family residential 14,605 Other 102,155 Residential Real Estate 449,867 30.6% Secured by 1 - 4 family - revolving 43,181 Secured by 1 - 4 family - closed end 333,148 Secured by multifamil
Slide 16: Credit Quality Statistics
16 Dollar Values in Thousands 12/31/2019 12/31/2020 6/30/2021 Non - performing Assets Nonaccrual Loans $10,590 $5,455 $3,947 90+ or More Days Past Due 1,326 804 752 Other Real Estate Owned 74 -- 203 Total Non - Performing Assets $11,990 $6,259 $4,902 Performing TDRs $7,501 $6,997 $6,338 Total NPAs +
Slide 17: Securities Portfolio
17 (Dollars in thousands) Amortized Cost Gross Unrealized Gains/(Losses) Estimated Fair Value Available - for - sale securities: June 30, 2021 U.S. Government Agencies $18,574 $(587) $17,987 Mortgage - backed 94,549 1,421 95,970 Total $113,123 $834 $113,957 Held - to - maturity securities: U.S Gover
Slide 18: Attractive Deposit Base
18 (Dollar Value in Thousands) June 30, 2021 Deposit Type Balance % of Total Average Rate (%) Noninterest Bearing Demand 538,009 28.6 0.00 Interest Bearing Demand 443,918 23.6 0.14 Money Market & Savings 621,072 33.0 0.17 CDs $100,000 or more 134,671 7.2 1.14 Other Time 142,912 7.6 1.00 Total Deposi
Slide 19: Yield Table with and without excess liquidity
19 Yield Table – 6/30/21 YTD with and without excess liquidity As reported YTD 6/30/2021 Without $100k in excess liquidity YTD 6/30/2021 (Dollars in thousands) Average Balance Interest Yield/rate Average Balance Interest Yield/rate Earnings assets Loans $1,447,767 $28,821 4.01% $1,447,767 $28,821 4.
Slide 20: Strong Capital and Asset Growth
20 Strong Capital and Asset Growth 12.32% 10.38% 11.13% 11.24% 9.18% 8.55% 0% 2% 4% 6% 8% 10% 12% 14% $0 $500 $1,000 $1,500 $2,000 $2,500 2016 2017 2018 2019 2020 2021(YTD) Total Assets TCE/TA
Slide 21: Capital Ratios (Bank Only)
21 Capital Ratios (Bank Only) 10.64% 9.73% 9.32% 13.00% 13.21% 13.15% 13.00% 13.21% 13.15% 13.87% 14.25% 14.21% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% YE 2019 YE 2020 6/30/2021 Tier 1 Leverage Ratio Common Equity Tier 1 Tier 1 Risk-Based Capital Ratio2 Total Risk-Based Capital Rat
Slide 22: Investment Considerations
22 Compelling Investment Considerations Excellent Cost of Funds Strategic plan positioned for organic growth and acquisitions Focused on creating sustainable competitive advantages Strengthened noninterest revenue sources Driving a sales culture with both a commercial and retail focus whil
Slide 23: Appendix
23 APPENDIX Appendix
Slide 24: SHBI Management Team
24 SHBI Management Team Talent, depth, unique skills Lloyd L. “Scott” Beatty, Jr ., 69, CPA, President & CEO of Shore Bancshares, Inc. since June 2013, Director of SHBI since December 2000, Director of Shore United Bank (formerly the Talbot Bank and CNB) since 1992. COO from 2006 until 2012 and na
Slide 25: Historical Balance Sheet
25 Dollar Values in Thousands 2017 2018 2019 2020 6/30/2021 Assets Cash and Cash Equivalents $31,820 $67,225 $94,971 $186,917 $237,188 Available for Sale Securities 196,955 154,432 122,791 139,568 113,957 Other Securities 3,735 7,745 5,532 70,727 203,457 Total Cash & Securities 238,757 235,445 232,0
Slide 26: Consolidated Historical Income Statement
26 Consolidated Historical Income Statement (1) Includes merger related expenses of $377 thousand. Net income excluding these expenses would’ve been $8,309 for the secon d q uarter of 2021. Note: June 30, 2021 data is YTD Source: S&P Global Market Intelligence Dollar Values in Thousands 2016 2017 20
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