Diane M. Turner, President & CEO
Annual Message
During 2023 we celebrated our 70th anniversary and had the opportunity to remember why First Shore Federal opened. This association was created by community leaders to provide financial services and products to local consumers that were not available 70 years ago by financial institutions on the Shore. First Shore Federal’s mission was to lend to local consumers to purchase their home, one of the biggest achievements in a person’s life. Our continued mission is to provide quality customer service and help our borrowers to achieve this home ownership dream.
First Shore helps to create home ownership and support our local communities through traditional mortgage lending, home equity lending, manufactured housing lending, and commercial loans. Making a difference in the communities we serve is one of our missions.
Depositors have been particularly affected by the low-rate environment of the past decade. We were pleased therefore to be able to offer attractively priced certificates of deposit as a savings option. We anticipate that the upcoming year will provide similar opportunities for our customers.
Being a mutual institution is still very important to our Board of Directors. As such we can focus on quality customer service, identify the needs of local consumers, and serve the needs of the community without stockholder pressure for the highest short-term earnings and dividends. Mutuality allows us to think long term.
As a mutual we recognize that our capital is critical to our business continuity. I am pleased to report that our net worth / capital ratio of over 16% is one of the highest in our local market and well above what regulators define as “well capitalized”. First Shore finished 2023 with record earnings of over $3.8 million and capital of more than $55.4 million.
We are pleased also to report that First Shore again earned a 5 Star rating, the highest awarded for financial stability, from Bauer Financial, a leading independent bank and credit union research firm.
We originated more than 320 new loans for over $43 million during 2023 and continued to be a strong lender in our market area. Loan growth was tempered moderately compared to 2022 as the Federal Open Market Committee (FOMC) of the Federal Reserve continued to increase interest rates to fight inflation. As a result, the prime rate increased from 3.25% to 8.50% over an 18-month period resulting in a slight down turn in home sales. Home prices, however, remain elevated compared to past years.
The economic environment continues to be challenging as the Ukraine and Israeli wars continue and although inflation is not rising as fast as it was, consumers are still paying higher prices for products they need.
First Shore Federal is proud to be “Community Minded” and to support local nonprofit and charitable organizations that benefit our communities on the Eastern Shore. Many of our directors, officers, and employees are involved in community efforts and provide their time and talents to many organizations. This continues to be an important mission of First Shore Federal. For many years First Shore has earned an “outstanding” rating by regulators for our investment in the community.
As we enter 2024 and our 8th decade of business, we are enthusiastic about expanding products and keeping quality service to attract new customers and serve our current customers. We begin the year with strong capital and improved credit quality however we are also entering a period of more restricted interest margins. We are hopeful that 2024 will be continued loan growth and deposit growth as we explore more products that consumers find useful to achieve their goals.
We thank our employees and officers for their dedication to excellent customer service and quality performance. We also thank our Board of Directors for their wisdom, oversight, and direction. We are very appreciative of our valued customers for their confidence in choosing to trust First Shore Federal to meet their banking needs.
