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Sep 30, 2020
Shore Bancshares Q3 2020 Earnings Report
Shore Bancshares' third quarter earnings were reported, showing a decrease in net income compared to the previous quarter and the same period last year.
Key Takeaways
Shore Bancshares reported income from continuing operations of $3.391 million, or $0.27 per diluted common share, for the third quarter of 2020. The company strategically issued $25 million of subordinated notes and allocated $1.5 million to its allowance for loan losses. COVID-related loan deferrals were significantly reduced, and the common stock repurchase program was reinstated.
Income from continuing operations was $3.391 million, or $0.27 per diluted common share.
Net interest income increased by $252 thousand compared to the second quarter of 2020.
COVID-related loan deferrals decreased to approximately 1% of the outstanding loan balance.
The company repurchased approximately 310,800 shares of its common stock during the third quarter.
Forward Guidance
The company expects loan demand to improve as it approaches year-end and intends to maintain its quarterly cash dividends based on its strong capital position.
Positive Outlook
- Loan demand is anticipated to improve as we approach year-end.
- The forgiveness of PPP loans which is anticipated in future quarters will have a positive impact on the net interest margin as these loans carry a much lower yield than our traditional loan portfolio.
- The Company currently expects to maintain its quarterly cash dividends based on its strong capital position.
- Reinstated common stock repurchase program on September 1, 2020.
- Excess liquidity of approximately $100 million, which has yet to be fully invested.
Challenges Ahead
- The extent of such impact will depend on future developments, which are highly uncertain, including when the coronavirus can be controlled and abated and when and how the economy may be fully reopened.
- The demand for our products and services may decline, making it difficult to grow assets and income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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