Shore Bancshares (SHBI)

Risks

• The ongoing COVID-19 pandemic and resulting substantial disruption to global and domestic economies could adversely impact our business operations, asset valuations, and financial results.
• A majority of our business is concentrated in Maryland and Delaware, a significant amount of which is concentrated in real estate lending, so a decline in the local economy and real estate markets could adversely impact our financial condition and results of operations.
• Our concentrations of commercial real estate loans could subject us to increased regulatory scrutiny and directives, which could force us to preserve or raise capital and/or limit our future commercial lending activities.
• Interest rates and other economic conditions will impact our results of operations.
• The Bank may experience credit losses in excess of its allowances, which would adversely impact our financial condition and results of operations.
• Our investment securities portfolio is subject to credit risk, market risk and liquidity risk.
• Impairment of investment securities, goodwill, other intangible assets, or deferred tax assets could require charges to earnings, which could result in a negative impact on our results of operations.
• Changes in accounting standards or interpretation of new or existing standards may affect how we report our financial condition and results of operations.
• Our future success will depend on our ability to compete effectively in the highly competitive financial services industry.
• Our funding sources may prove insufficient to replace deposits and support our future growth.
• The loss of key personnel could disrupt our operations and result in reduced earnings.
• Our lending activities subject us to the risk of environmental liabilities.
• We may be subject to other adverse claims.
• We depend on the accuracy and completeness of information about customers and counterparties and our financial condition could be adversely affected if we rely on misleading information.
• Our exposure to operational, technological and organizational risk may adversely affect us.
• Our information systems may experience an interruption or breach in security.
• Our reliance on third party vendors could expose us to additional cyber risk and liability.
• We outsource certain aspects of our data processing to certain third-party providers which may expose us to additional risk.
• We are dependent on our information technology and telecommunications systems and third-party servicers, and systems failures, interruptions or breaches of security could have an adverse effect on our financial condition and results of operations.
• Technological changes affect our business, and we may have fewer resources than many competitors to invest in technological improvements.
• The replacement of the LIBOR benchmark interest rate may have an impact on our business, financial condition, or results of operations.
• We operate in a highly regulated environment, which could restrain our growth and profitability.
• Federal regulators periodically examine our business, and we may be required to remediate adverse examination findings.
• Our FDIC deposit insurance premiums and assessments may increase.
• We are subject to numerous laws designed to protect consumers, including the Community Reinvestment Act and fair lending laws, and failure to comply with these laws could lead to a wide variety of sanctions.
• We are subject to evolving and extensive regulations and requirements. Our failure to adhere to these requirements or the failure or circumvention of our controls and procedures could seriously harm our business.
• We face a risk of noncompliance and enforcement action with the BSA and other anti-money laundering statues and regulations.
• Our common stock is not insured by any governmental entity.
• Our ability to pay dividends is limited by law and contract.
• The shares of our common stock are not heavily traded.
• Future sales of our common stock or other securities may dilute the value and adversely affect the market price of our common stock.
• We may issue debt and equity securities that are senior to the common stock as to distributions and in liquidation, which could negatively affect the value of the common stock.