Shore Bancshares (SHBI) investor relations material

Executive summary

• Q3 net income was $16.8 million, or $0.50 diluted EPS, vs. $18.9 million/$0.56 in Q2 2026 and $14.3 million/$0.43 in Q3 2025.

• PTPP rose 5.6% QoQ to $27.5 million; 9M PTPP increased 20.4% YoY to $76.4 million. Higher credit-loss provision, mainly tied to a multifamily relationship, weighed on reported earnings.

• Quarter-end loans were $4.90 billion and deposits were $5.70 billion; management priorities include core deposit growth, credit oversight, expense control, automation and AI investment, and capital and liquidity.

Financial highlights

• Q3 net interest income was $55.1 million, up $2.2 million QoQ and $6.7 million YoY; 9M net interest income rose 13.5% YoY to $160.6 million.

• Provision for credit losses was $5.3 million vs. $896 thousand in Q2 and $3.0 million in Q3 2025; net charge-offs were $4.8 million vs. $123 thousand and $1.8 million, respectively.

• Noninterest income was $7.7 million, down $1.2 million QoQ; noninterest expense declined $405 thousand QoQ to $35.3 million but rose $884 thousand YoY.

• 9M net income rose 20.9% YoY to $52.7 million; diluted EPS increased 20.6% to $1.58.

Outlook and guidance

• FY 2026 outlook: low-single-digit loan growth, mid-single-digit deposit growth, NIM of 3.60%–3.70%, mid-50% efficiency ratio, low-single-digit fee income growth, and expenses up 4% over 2025.

• FY 2026 credit outlook: ACL/loans near 1.20%, net charge-offs/loans of 15–20 bps, and year-end nonaccrual loans below 1% of loans; capital targets include CET1 ≥11%, total risk-based capital ≥14%, and tangible equity/tangible assets ≥8%.

• 2027 outlook: low- to mid-single-digit loan growth, mid-single-digit deposit growth, NIM of 3.60%–3.75%, and expense growth of 2%–3% over 2026.

• A $100–$150 million loan pipeline entered Q4; management expects modest loan growth for the remainder of 2026 and assumes 2–3 additional Fed rate hikes during 2026–27.

• Management expects loan repricing to benefit from higher rates, while elevated or further-rising rates may pressure borrowers; borrower engagement, prudent modifications, and stress testing continue.