U. S. SECURITIES AND EXCHANGE
                        COMMISSION Washington, D.C. 20549
                                    FORM 10-Q


  X     QUARTERLY  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
        ACT OF 1934
               For the quarterly period ended September 30, 2007

        TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
        ACT OF 1934
               For the transition period from _________ to _________

                        Commission file number 000-23847

                           SHORE FINANCIAL CORPORATION

             (Exact name of registrant as specified in its charter)

                    Virginia                                  54-1873994
      ---------------------------------                 ----------------------
        (State or other jurisdiction                       (I.R.S. Employer
      of incorporation or organization)                 Identification Number)

        25253 Lankford Highway
           Onley, Virginia                                       23418
      ---------------------------------                 ----------------------
           (Address of Principal                               (Zip Code)
             Executive Offices)

                    Issuer's telephone number: (757) 787-1335


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
                                                Yes ___X___    No_______

Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large  accelerated  filer" in Rule 12b-2 of the Exchange  Act.  (Check
one):
  Large accelerated filer_____ Accelerated filer____ Non-accelerated filer__X__

     Indicate  by check mark  whether  the  registrant  is a shell  company  (as
defined in Rule 12b-2 of the Exchange Act).
                                                Yes _____ No___X___

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
                                                           Yes_____  No_____

Number of shares of Common Stock outstanding as of November 12, 2007:  2,500,927






<PAGE>


                  SHORE FINANCIAL CORPORATION AND SUBSIDIARIES
                                Index - Form 10-Q

                         PART I - FINANCIAL INFORMATION

         Item 1 - Consolidated Financial Statements (Unaudited)

                           Consolidated Statements of Financial Condition as of
                               September 30, 2007 and December 31, 2006

                           Consolidated Statements of Income for the Three and
                               Nine Months Ended September 30, 2007 and 2006

                           Consolidated Statements of Stockholders' Equity for
                               the Nine Months Ended September 30, 2007 and 2006

                           Consolidated Statements of Cash Flows for the Nine
                               Months Ended September 30, 2007 and 2006

                           Notes to Unaudited Consolidated Financial Statements

         Item 2 - Management's Discussion and Analysis of Financial Condition
                           and Results of Operations

                           Results of Operations

                           Interest Sensitivity

                           Financial Condition

                           Asset Quality

                           Liquidity and Capital Resources

         Item 3 - Quantitative and Qualitative Disclosures about Market Risk

         Item 4 - Controls and Procedures


                           PART II - OTHER INFORMATION
         Item 1 - Legal Proceedings
         Item 1A - Risk Factors
         Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds
         Item 3 - Defaults Upon Senior Securities
         Item 4 - Submission of Matters to Vote of Security Holders
         Item 5 - Other Information
         Item 6 - Exhibits

                                   SIGNATURES



<PAGE>

<TABLE>


                                  Consolidated Statements of Financial Condition


                                                                            September 30,           December 31,
                                                                                2007                  2006
-------------------------------------------------------------------------------------------------------------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>

                                ASSETS


Cash (including interest-earning deposits of
     approximately $5,179,300 and $2,267,000, respectively)            $         14,537,400     $        9,469,800
Investment securities:
     Available-for-sale (amortized cost of $24,124,700 and
         $27,791,300, respectively)                                              24,129,600             27,965,300
     Other investments, at cost                                                   2,727,100              2,442,700
Loans receivable, net                                                           213,945,800            207,725,200
Premises and equipment, net                                                       7,320,200              7,044,300
Other assets                                                                      6,459,300              6,028,700
                                                                       --------------------------------------------

                                                                       $        269,119,400     $      260,676,000
                                                                       ============================================

                 LIABILITIES AND STOCKHOLDERS' EQUITY

Deposits:
         Interest-bearing                                              $        170,893,400     $      172,548,300
         Noninterest-bearing                                                     28,783,400             25,554,500
                                                                       ---------------------   --------------------
            Total deposits                                                      199,676,800            198,102,800

Advances from Federal Home Loan Bank                                             40,633,300             35,233,300
Other liabilities                                                                 1,349,200              1,213,600
                                                                       --------------------------------------------
            Total liabilities                                                   241,659,300            234,549,700
                                                                       --------------------------------------------

Stockholders' equity
     Preferred stock, par value $1 per share, 500,000
         shares authorized; none issued and
         outstanding                                                                      -                      -
     Common stock, par value $.275; 6,000,000
         shares authorized; 2,500,927 and
         2,497,327 issued and outstanding, respectively                             687,800                686,800
     Additional capital                                                           8,400,000              8,372,600
     Retained earnings                                                           18,370,500             16,953,400
     Accumulated other comprehensive income (loss)                                    1,800                113,500
                                                                       --------------------------------------------
            Total stockholders' equity                                           27,460,100             26,126,300
                                                                       --------------------------------------------

                                                                       $        269,119,400     $      260,676,000
                                                                       ============================================


                    The accompanying notes are an integral part of these financial statements.


</TABLE>


<PAGE>



<TABLE>



      Consolidated Statements of Income

                                              Three Months Ended September 30,         Nine Months Ended September 30,
                                              ---------------------------------    ----------------------------------------
                                                  2007                 2006               2007                  2006
-------------------------------------------------------------------------------    ----------------------------------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>

Interest and dividend income
     Loans                                    $   3,799,700      $   3,480,400     $        11,049,900      $    9,984,200
     Investments
         Taxable interest                           232,400            264,400                 701,600             847,100
         Tax-exempt interest                         60,500             39,300                 181,200             110,300
         Dividends                                   71,400             68,000                 207,600             180,800
                                              ---------------------------------    ----------------------------------------
          Total interest and dividend income      4,164,000          3,852,100              12,140,300          11,122,400
                                              ---------------------------------    ----------------------------------------

Interest expense
     Deposits                                     1,416,800          1,374,900               4,359,600           3,500,200
     FHLB/other advances                            456,900            398,000               1,215,600           1,254,800
                                              ---------------------------------    ----------------------------------------
          Total interest expense                  1,873,700          1,772,900               5,575,200           4,755,000
                                              ---------------------------------    ----------------------------------------

Net interest income                               2,290,300          2,079,200               6,565,100           6,367,400

Provision for loan losses                            12,400             13,500                  24,100              50,200
                                              ---------------------------------    ----------------------------------------

Net interest income after
     provision for loan losses                    2,277,900          2,065,700               6,541,000           6,317,200
                                              ---------------------------------    ----------------------------------------

Noninterest income
     Deposit account fees                           594,600            578,600               1,710,100           1,738,000
     Loan fees                                       30,700             28,800                  86,600              82,400
     Mortgage banking fees                           33,900             29,300                 159,300              78,700
     Commissions on investment brokerage sales      100,900             67,100                 282,600             257,600
     Gains (losses) on sales of securities           (7,800)            52,600                  15,700              52,600
     Other                                           59,600             61,800                 198,600             191,400
                                              ---------------------------------    ----------------------------------------
          Total noninterest income                  811,900            818,200               2,452,900           2,400,700
                                              ---------------------------------    ----------------------------------------

Noninterest expense
     Compensation and employee
         benefits                                 1,072,000            954,200               3,201,300           2,810,200
     Occupancy and equipment                        444,500            453,700               1,299,400           1,292,500
     Data processing                                188,500            188,100                 613,300             604,000
     Professional fees                               86,500             90,800                 286,300             283,800
     Marketing and promotion                         53,600             34,100                 129,200              97,300
     Loss on disposals of fixed assets                    -                  -                 147,900                   -
     Other                                          215,400            190,700                 601,300             583,600
                                              ---------------------------------    ----------------------------------------
          Total noninterest expense               2,060,500          1,911,600               6,278,700           5,671,400
                                              ---------------------------------    ----------------------------------------

Income before income taxes                        1,029,300            972,300               2,715,200           3,046,500

Income taxes                                        298,900            301,400                 773,400             944,400
                                              ---------------------------------    ----------------------------------------

Net income                                    $     730,400      $     670,900     $         1,941,800      $    2,102,100
                                              =================================    ========================================

Cash Dividends Declared Per Share             $        0.07      $        0.07     $              0.21      $         0.18
                                              =================================    ========================================

Earnings Per Common Share:
         Basic                                $        0.29      $        0.27     $              0.78      $         0.84
                                              =================================    ========================================

         Diluted                              $        0.29      $        0.27     $              0.77      $         0.83
                                              =================================    ========================================



              The accompanying notes are an integral part of these financial statements.



</TABLE>


<PAGE>



<TABLE>

                                            Consolidated Statements of Stockholders' Equity


------------------------------------------------------------------------------------------------------------------------------------

                                                                                                        Accumulated
                                                                                                           Other
                                        Number of       Common         Additional       Retained       Comprehensive
                                          Shares         Stock          Capital         Earnings       Income (Loss)         Total
                                       -----------  --------------------------------------------------------------------------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>


Balance, December 31, 2005               2,074,207    $  684,500    $   8,267,400   $  14,631,400    $       45,300  $   23,628,600

Common stock cash dividend
    declared                                     -             -                -        (435,900)                -        (435,900)

Exercise of stock options                    2,620           900           57,900               -                 -          58,800

Tax benefit associated with the
    exercise of stock options                    -             -            8,100               -                 -           8,100

6-for-5 Stock Split                        415,316          (100)               -            (800)                -            (900)

Comprehensive income (loss)                      -             -                -       2,102,100            74,800       2,176,900
                                        -----------  -------------------------------------------------------------------------------

Balance, September 30, 2006              2,492,143    $  685,300    $   8,333,400   $  16,296,800    $      120,100  $   25,435,600
                                        ===========  ===============================================================================

Balance, December 31, 2006               2,497,327    $  686,800    $   8,372,600   $  16,953,400    $      113,500  $   26,126,300

Common stock cash dividend
    declared                                     -             -                -        (524,700)                -        (524,700)

Exercise of stock options                    3,600         1,000           21,700               -                 -          22,700

Tax benefit associated with the
    exercise of stock options                    -             -            5,700               -                 -           5,700

Comprehensive income                             -             -                -       1,941,800          (111,700)      1,830,100
                                        -----------  -------------------------------------------------------------------------------

Balance, September 30, 2007              2,500,927    $  687,800    $   8,400,000   $  18,370,500    $        1,800  $   27,460,100
                                        ===========  ===============================================================================




                        The accompanying notes are an integral part of these financial statements.

</TABLE>


<PAGE>



<TABLE>


                        Consolidated Statements of Cash Flows


                                                                Nine Months Ended September 30,
                                                                -------------------------------
                                                                        2007          2006
-----------------------------------------------------------------------------------------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>

Cash flows from operating activities
    Net income                                                   $   1,941,800  $   2,102,100
    Adjustments to reconcile to net cash
      provided by operating activities:
        Provision for loan losses                                       24,100         50,200
        Depreciation and amortization                                  516,500        566,800
        Amortization of premium and accretion
          of discount on securities, net                                (7,900)         8,400
        Gain on sale of investment securities                          (15,700)       (52,600)
        Loss on disposal of fixed assets                               147,900              -
        Increase in cash surrender value of life insurance            (118,000)      (109,500)
        Tax benefit of stock options exercised                           5,700          8,100
        Changes in:
          Deferred loan fees                                             1,800         60,400
          Other assets                                                (302,600)       (76,500)
          Other liabilities                                            134,400        (10,400)
                                                                -------------------------------
          Net cash flows from operating activities                   2,328,000      2,547,000
                                                                -------------------------------

Cash flows from investing activities
    Purchase of available-for-sale securities                         (706,100)    (3,094,200)
    Proceeds from maturities, sales and calls of
      available-for-sale securities                                  4,396,300      4,233,400
    Purchase of other investments                                   (2,057,800)    (1,798,700)
    Proceeds from maturities, sales and calls of
      other investments                                              1,773,400     1,976,700
    Loan originations, net of repayments                            (6,246,500)   (14,221,500)
    Purchase of premises and equipment                                (891,700)      (167,200)
                                                                -------------------------------
          Net cash flows from investing activities                  (3,732,400)   (13,071,500)
                                                                -------------------------------


<PAGE>



                        Consolidated Statements of Cash Flows

                                                                Nine Months Ended September 30,
                                                                -------------------------------
                                                                        2007          2006
-----------------------------------------------------------------------------------------------

Cash flows from financing activities
    Net increase (decrease) in demand deposits                   $   9,064,000  $  (7,183,800)
    Net increase (decrease) in time deposits                        (7,490,000)    23,043,800
    Proceeds from FHLB advances                                    263,950,000    169,400,000
    Repayments of FHLB advances                                   (258,550,000)  (171,550,000)
    Proceeds from exercise of stock options                             22,700         58,800
    Payment of dividends on common stock                              (524,700)      (435,900)
                                                                -------------------------------
          Net cash flows from financing activities                   6,472,000     13,332,900
                                                                -------------------------------

Change in cash and cash equivalents                                  5,067,600      2,808,400

Cash and cash equivalents, beginning of period                       9,469,800      9,176,000
                                                                -------------------------------

Cash and cash equivalents, end of period                         $  14,537,400  $  11,984,400
                                                                ===============================


Supplemental disclosure of cash flow information

    Cash paid during the period for interest                     $   5,556,601  $   4,623,700
    Cash paid during the period for income taxes                 $     965,000  $     970,000


The accompanying notes are an integral part of these financial statements.


</TABLE>


<PAGE>







                  SHORE FINANCIAL CORPORATION AND SUBSIDIARIES
              Notes to Unaudited Consolidated Financial Statements

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited consolidated financial statements of Shore Financial
Corporation and Subsidiaries (the "Company") have been prepared in accordance
with generally accepted accounting principles ("GAAP") and with the instructions
to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include
all of the information and footnotes required by GAAP for complete financial
statements in the United States of America. In the opinion of management, all
adjustments (consisting of normal recurring accruals) necessary for a fair
presentation of the consolidated financial statements have been included.

In preparing the consolidated financial statements in conformity with GAAP in
the United States of America, management is required to make estimates and
assumptions that affect the amounts reported in the consolidated financial
statements and accompanying notes. Actual results could differ from those
estimates. The consolidated results of operations and other data for the nine
month period ended September 30, 2007 are not necessarily indicative of the
results that may be expected for any other interim period or the entire year
ending December 31, 2007. The unaudited consolidated financial statements
presented herein should be read in conjunction with the audited consolidated
financial statements and related notes thereto in the Company's Annual Report on
Form 10-K for the year ended December 31, 2006.

Principles of Consolidation

The consolidated financial statements of the Company include and primarily
consist of the accounts of its wholly-owned subsidiary Shore Bank (the "Bank")
and the Bank's wholly-owned subsidiary Shore Investments, Inc. All significant
intercompany balances and transactions have been eliminated in consolidation.

Reclassifications

Certain reclassifications of the prior period's information have been made to
conform to the September 30, 2007 presentation.


<PAGE>




NOTE 2 - EARNINGS PER SHARE

The following is a reconciliation of the numerators and denominators of the
basic and diluted earnings per share computations for the periods ended
September 30, 2007 and 2006.

<TABLE>

                                                        Three Months Ended September 30,          Nine Months Ended September 30,
                                                   -----------------------------------------   -------------------------------------
                                                          2007                  2006                  2007               2006
                                                   ------------------     ------------------   ------------------   ----------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>


Net income (numerator, basic and diluted)            $       730,400        $       670,900      $     1,941,800      $   2,102,100
Weighted average shares outstanding
(denominator)                                              2,500,500              2,492,200            2,499,400          2,491,500
                                                   ------------------     ------------------   ------------------   ----------------
 Earnings per common share - basic                   $          0.29        $          0.27      $          0.78      $        0.84
                                                   ==================     ==================   ==================   ================

Effect of dilutive securities:

Weighted average shares outstanding                        2,500,500              2,492,200            2,499,400          2,491,500
Effect of stock options                                       17,700                 28,700               22,900             26,300
                                                   ------------------     ------------------   ------------------   ----------------
Diluted average shares outstanding
(denominator)                                              2,518,200              2,520,900            2,522,300          2,517,800
                                                   ------------------     ------------------   ------------------   ----------------

Earnings per common share -
assuming dilution                                             $ 0.29                 $ 0.27      $          0.77      $        0.83
                                                   ==================     ==================   ==================   ================


</TABLE>


NOTE 3 - COMPREHENSIVE INCOME

Total comprehensive income consists of the following for the nine months ended
September 30, 2007 and 2006:


<TABLE>

                                             Nine Months Ended September 30,
                                           -------------------------------------
                                                 2007                2006
                                           ------------------  -----------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>


Net income                                       $ 1,941,800         $2,102,100
Other comprehensive income (loss)                   (111,700)            74,800
                                           ------------------  -----------------

Total comprehensive income                       $ 1,830,100         $2,176,900
                                           ==================  =================


</TABLE>


<PAGE>





NOTE 3 - COMPREHENSIVE INCOME (concluded)

The following is a reconciliation of the related tax effects allocated to each
component of other comprehensive income at September 30, 2007 and 2006.


<TABLE>

                                             Nine Months Ended September 30,
                                           -------------------------------------
                                                 2007                2006
                                           ------------------  -----------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>


Unrealized gains (losses) on
      available-for-sale securities:
       Unrealized holding gains (losses)
             arising during the period            $ (153,400)        $ 168,600
       Less: reclassification adjustment
             for gain included in income             (15,700)          (52,600)
                                           ------------------  -----------------

Total other comprehensive gain (loss)
     before tax effect                              (169,100)          116,000

Tax benefit (expense)                                 57,400           (41,200)
                                           ------------------  -----------------

Net unrealized gain (loss)                        $ (111,700)         $ 74,800
                                           ==================  =================


</TABLE>


NOTE 4 - SEGMENT INFORMATION

Segment information consists of the following for the nine months ended
September 30, 2007 and 2006:

<TABLE>

                                                                                                Elimination of
                                                                                                 Intersegment
(In thousands)                                    Virginia        Maryland         Other         Transactions         Total
                                               -------------   --------------  --------------  -----------------  --------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>


Net Interest Income:
     Nine Months ended September 30, 2007       $     4,907     $      1,372    $       (424)   $           710    $      6,565
     Nine Months ended September 30, 2006       $     4,836     $      1,323    $       (277)   $           485    $      6,367

Assets:
     September 30, 2007                         $   206,827     $     51,130    $     43,358    $       (32,196)   $    269,119
     December 31, 2006                          $   198,692     $     49,441    $     43,531    $       (30,988)   $    260,676

</TABLE>


NOTE 5 - LONG-LIVED ASSETS

During the quarter ended September 30, 2007, the Bank sold a branch facility and
an adjoining investment property for $375,000, resulting in a net gain of
$289,000. The Bank accounted for the sale using the installment method in
accordance with FASB Statement No. 66.

NOTE 6 - SUBSEQUENT EVENT

During October 2007, the Company declared a $0.08 per share quarterly cash
dividend on its common stock payable on November 1, 2007 to shareholders of
record on October 23, 2007.


<PAGE>



Item 2 - Management's Discussion and Analysis of
           Consolidated Financial Condition and Results of Operations

Results of Operations

General

The Company's net income for the three months ended September 30, 2007 was
$730,400, or $0.29 per diluted share, representing an 8.9% increase over
earnings of $670,900, or $0.27 per diluted share, for the same period of 2006.
Earnings for the nine months ended September 30, 2007 were $1.94 million, or
$0.77 per diluted share, compared to $2.10 million, or $.83 per diluted share,
for the 2006 nine month period.

During the third quarter, the financial markets experienced significant turmoil,
primarily resulting from fallout caused by the subprime mortgage market. This
turmoil contributed to the Federal Reserve's decision to lower the fed funds
target rate by 50 basis points during September. Although the Company has not
realized the full impact of the rate cut, it continued to benefit from upward
rate adjustments on adjustable rate mortgages and lower costing wholesale
funding opportunities during the quarter.

Despite a continuing soft residential real estate market, the Bank was able to
generate loan growth during the quarter. Outstanding loan balances on September
30, 2007 were $216.8 million, compared to $213.7 million and $209.7 million at
June 30, 2007 and September 30, 2006 respectively. The Bank's asset quality
remained strong during the quarter with a non current loan to total loan ratio
of 0.75% at September 30, 2007, while the Bank's allowance for loan losses to
period end loans ratio was 1.32%, representing levels management considers
manageable and commensurate with the risk existing in the Bank's loan portfolio.

The Company is progressing on several strategic initiatives it has undertaken to
position itself for future growth and to capitalize on the changing environment
in its banking markets. During September, the Bank opened its eighth branch
location in Pocomoke City, Maryland. This market offers a great opportunity for
the Bank to expand its footprint while complimenting the Bank's existing
markets. In Salisbury, Maryland, the Bank has begun the site work for a new full
service banking facility on an existing branch site. Finally, the Bank has
completed the design phase and has begun the bidding process for a new full
service banking facility in its Cheriton, Virginia market that will be located
near the entrance to the Bay Creek Community in Cape Charles, Virginia and will
provide a better facility to serve Northampton County.


Net Interest Income

Net interest margin improvement continued during the third quarter as
anticipation of the Federal Reserve's actions heightened, adjustable rate
mortgage loans adjusted upward and lower-costing wholesale funding opportunities
became available. Accordingly, the Company's net interest margin was 3.74% and
3.62% for the three and nine months ended September 30, 2007, respectively. The
quarterly margin represents a 28 basis point increase since the first quarter of
2007. Also contributing to the improved margin was the successful introduction
of several new products and promotions initiated by the bank to attract new
lower costing checking accounts. As a result, net interest income was $2.29
million and $6.57 million, respectively, during the three and nine month periods
ended September 30, 2007, compared to $2.08 million and $6.37 million,
respectively, during the same periods of 2006.

Average earning assets for the nine months ended September 2007 increased $5.1
million over the September 2006 period. Growth of $7.3 million occurred in
average loans while average investments declined $2.2 million. The Bank
continues to experience the majority of its loan growth in the residential real
estate and commercial sectors, in spite of a decline in the number of
residential properties being sold. Although the investment markets have improved
during 2007, liquidity demands generated by the loan growth resulted in the
decline in investment balances during the period.


<PAGE>



Average total deposits increased to $202.1 million during the period, compared
to $196.5 million during the 2006 period. Growing demand deposit accounts
continues to be a challenge in the current banking environment as competition
for core deposits has intensified. Average interest-bearing checking and savings
demand deposits declined $3.3 million when compared to the September 2006 nine
month period, while noninterest-bearing demand deposits experienced nominal
growth of just under $1.0 million during the period. The Bank used retail and
brokered time deposits to offset liquidity shortfalls, resulting in an increase
of $8.0 million in these average balances during the comparable periods.
Although pricing considerations made brokered time deposits more appealing than
Federal Home Loan Bank ("FHLB") advances during most of 2006 and early 2007,
recent FHLB pricing has improved and the Bank is again using them as a viable
funding alternative. Average FHLB advances declined $2.0 million during the
September 2007 nine month period as compared to the September 2006 period.

Interest and dividend income improved to $4.16 million and $12.14 million for
the three and nine month periods ended September 30, 2007, representing
increases of 8.1% and 9.2%, respectively, over the comparable 2006 amounts. A
$7.3 million increase in average loans outstanding and repricing of adjustable
rate mortgage loans contributed to the increase in interest and dividend income.
Yields on earning assets increased 45 basis points to 6.66% during the September
2007 period which was comprised of 28 and 45 basis points increases in yields on
investment securities and loans, respectively.

Interest expense for the three and nine months ended September 30, 2007 was
$1.87 million and $5.58 million, respectively, representing an increase of 5.7%
and 17.2%, respectively, over comparable 2006 amounts. The June 2007 quarterly
and six month comparisons had increases of 13.1% and 24.1%, respectively, over
the comparable 2006 periods. Therefore, growth in interest expense slowed during
the September 2007 quarter when compared to the June 2007 period. The costs of
total interest-bearing liabilities increased 49 basis points during the nine
months ended September 30, 2007 as compared to the 2006 comparable period.
Although the 45 basis point increase in yields on earnings assets did not fully
offset the increase in funding costs, the gap has significantly improved from 22
basis points reflected in the June 2007 to June 2006 six month comparison to the
4 basis points existing in the September 2007 to September 2006 nine month
comparison. This improvement reflects a leveling of funding costs during the
2007 third quarter. The interest rate environment improved during the third
quarter with the slope of the yield curve taking a more positive direction.
Additionally, the Bank continues to generate more growth in several new products
and promotions initiated during 2007 to attract new lower costing checking
accounts.




<PAGE>



The following table illustrates average balances of total interest-earning
assets and total interest-bearing liabilities for the periods indicated, showing
the average distribution of assets, liabilities, and stockholders' equity and
the related income, expense and corresponding weighted average yields and costs.
The average balances used in these tables and other statistical data were
calculated using daily averages.


<TABLE>

                               Average Balances, Income and Expenses, Yields and Rates

                                                                         Nine Months Ended September 30,
                                               --------------------------------------------------------------------------
                                                               2007                                  2006
                                               ------------------------------------  ------------------------------------
                                                 Average      Income/     Yield/       Average      Income/     Yield/
(Dollars In Thousands)                           Balance      Expense      Rate        Balance      Expense      Rate
                                               -----------  ----------- -----------  -----------  ----------- -----------
<S>     <C>    <C>    <C>    <C>    <C>    <C>

Assets:
            Securities (1)                     $   29,619   $    1,104       4.97%   $   31,830   $    1,119       4.69%
            Loans (net of unearned income):
                  Real estate mortgage            120,468        5,700       6.31%      114,076        5,024       5.87%
                  Commercial                       75,648        4,262       7.51%       73,078        3,827       6.98%
                  Home equity lines                13,796          879       8.50%       15,584          932       7.97%
                  Consumer                          3,042          209       9.16%        2,950          201       9.08%
                                                 ---------    ---------               ----------    ---------
                      Total loans                 212,954       11,050       6.92%      205,688        9,984       6.47%
            Interest-bearing deposits
                  in other banks                    2,494           80       4.28%        2,433           76       4.16%
                                                 ---------                            ----------
                                                              ---------                             ---------
                      Total earning assets        245,067       12,234       6.66%      239,951       11,179       6.21%
                                                              ---------                             ---------
            Less: allowance for loan losses        (2,866)                               (2,874)
            Total nonearning assets                20,122                                18,830
                                                 ---------                            ----------
            Total assets                       $  262,323                            $  255,907
                                                 =========                            ==========

Liabilities
            Interest-bearing deposits:
                  Checking and savings         $   65,643   $      708       1.44%   $   68,988   $      449       0.87%
                  Time deposits                   108,597        3,651       4.48%      100,557        3,051       4.05%
                                                 ---------    ---------               ----------    ---------

                      Total interest-bearing
                      deposits                    174,240        4,359       3.34%      169,545        3,500       2.75%

            FHLB advances                          32,424        1,216       5.00%       34,423        1,255       4.86%
                                                 ---------    ---------               ----------    ---------
                      Total interest-bearing
                      liabilities                 206,664        5,575       3.60%      203,968        4,755       3.11%
                                                              ---------                             ---------
            Non-interest bearing liabilities:
                  Demand deposits                  27,889                                26,957
                  Other liabilities                   846                                   392
                                                 ---------                            ----------

            Total liabilities                     235,399                               231,317
            Stockholders' equity                   26,924                                24,590
                                                 ---------                            ----------

            Total liabilities and stockholders'
                  equity                       $  262,323                            $  255,907
                                                 =========                            ==========

            Net interest income (1)                      $    6,659                            $    6,424
                                                           =========                             =========

            Interest rate spread (1)(2)(3)                                3.06%                                 3.10%
            Net interest margin (1)(4)                                    3.62%                                 3.57%


(1)      Tax equivalent  basis. The tax equivalent  adjustment to net interest income was $94,000 and $57,000 for the nine months
         ended September 30, 2007 and 2006, respectively.
(2)      Yield and rate percentages are all computed through the annualization of interest income and expense divided by average
         daily balances based on amortized costs.
(3)      Interest  rate spread is the  average  yield  earned on earning  assets less the  average  rate  incurred on
         interest-bearing liabilities.
(4)      Net interest margin is derived by dividing net interest income by average total earning assets.

</TABLE>



<PAGE>



Interest Sensitivity

Management evaluates interest rate sensitivity periodically through the use of
an asset/liability management reporting model. Using this model, management
determines the overall magnitude of interest sensitivity risk and then
formulates strategies governing asset generation and pricing, funding sources
and pricing, and off-balance-sheet commitments in order to reduce sensitivity
risk. These decisions are based on interest rate trends, the state of the local
and national economy, and other financial and business risk factors.

An important element of the Company's asset/liability management process is
monitoring its interest sensitivity gap. The interest sensitivity gap is the
difference between interest sensitive assets and interest sensitive liabilities
at a specific time interval. A gap is considered positive when the amount of
interest rate sensitive assets exceeds the amount of interest rate sensitive
liabilities, and is considered negative when the amount of interest rate
sensitive liabilities exceeds the amount of interest rate sensitive assets
during a given period. Generally, during a period of rising interest rates, a
negative gap within shorter maturities would adversely affect net interest
income, while a positive gap within shorter maturities would result in an
increase in net interest income. Conversely, during a period of falling interest
rates, a negative gap within shorter maturities would result in an increase in
net interest income while a positive gap within shorter maturities would have
the opposite effect. This gap can be managed by repricing assets or liabilities,
by selling investments available for sale, by replacing an asset or liability at
maturity, or by adjusting the interest rate during the life of an asset or
liability. Matching the amounts of assets and liabilities maturing in the same
time interval helps to hedge the risk and minimize the impact on net interest
income in periods of rising or falling interest rates.


<PAGE>



The following table presents the Company's interest sensitivity position at
September 30, 2007. This one-day position, which continually is changing, is not
necessarily indicative of the Company's position at any other time.

<TABLE>

                                           Interest Sensitivity Analysis

                                                                            September 30, 2007
                                             --------------------------------------------------------------------------------
                                                 Within            91-365          1 to 5            Over
(Dollars In Thousands)                           90 Days            Days            Years           5 Years         Total
                                             --------------   ---------------  ----------------  -------------  -------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>

Interest-Earning Assets:
       Loans (1)                              $    53,364      $     70,474     $      86,206     $    6,756      $  216,800
       Securities (2)                               2,995             1,998            14,377          7,487          26,857
       Money market and other
           short term securities                    5,179                 -                 -              -           5,179
       Other earning assets                             -                 -                 -          3,679           3,679
                                             --------------   ---------------  ----------------  -------------  --------------

       Total earning assets                   $    61,538      $     72,472     $     100,583     $   17,922      $  252,515
                                             ==============   ===============  ================  =============  ==============
       Cumulative earning assets              $    61,538      $    134,010     $     234,593     $  252,515      $  252,515
                                             ==============   ===============  ================  =============  ==============


Interest-Bearing Liabilities:
       Money market savings                   $    16,688      $          -     $           -     $        -      $   16,688
       Interest checking (3)                            -                 -            30,294              -          30,294
       Savings (3)                                  2,508               926            16,062              -          19,496
       Certificates of deposit                     37,766            42,229            23,539            881         104,415
       FHLB advances                               15,200            18,000             7,000            433          40,633
                                             --------------   ---------------  ----------------  -------------  --------------

       Total interest-bearing liabilities     $    72,162      $     61,155     $      76,895     $    1,314      $  211,526
                                             ==============   ===============  ================  =============  ==============
       Cumulative interest-bearing
           liabilities                        $    72,162      $    133,317     $     210,212     $  211,526      $  211,526
                                             ==============   ===============  ================  =============  ==============

       Period gap                             $   (10,624)     $     11,317     $      23,688     $   16,608      $   40,989
       Cumulative gap                         $   (10,624)     $        693     $      24,381     $   40,989      $   40,989
       Ratio of cumulative interest-earning
           assets to interest-bearing
           liabilities                              85.28%           100.52%           111.60%        119.38%         119.38%
       Ratio of cumulative gap to total
           earning assets                           (4.21%)            0.27%             9.66%         16.23%          16.23%



(1)  Includes nonaccrual loans of $709,000, which are spread throughout the categories.
(2)  Management has determined that interest checking and savings accounts are not as sensitive to changes in related market rates
        and, therefore, they are placed in the 1 to 5 years category.

</TABLE>



Noninterest Income

The Company's noninterest income was $811,900 for the September 2007 quarter,
compared to $818,200 for the September 2006 quarter end, while non interest
income was $2.45 million and $2.40 million for the nine months ended September
30, 2007 and 2006, respectively. The Bank's mortgage banking division has posted
significant gains in fee income during 2007 with an increase from $78,700 during
the 2006 nine month period to $159,300 during the 2007 comparable period. While
fees levied on insufficient funds continues to be down from the 2006 period,
other deposit fee categories have experienced substantial growth as the Bank
increases the number of retail and commercial deposit relationships.

Provision for Loan Losses

With asset quality remaining strong during the last several quarters, the
Company has not been required to make significant contributions to the provision
for loan loss. The $24,100 and $50,200 contributed during the September 2007 and
2006 nine month periods, respectively, primarily related to overdraft deposit
accounts. Management considers the allowance for loan loss to be commensurate
with the risk existing in the Bank's loan portfolio. See Asset Quality for
additional discussion relating to the allowance for loan losses and related risk
in the loan portfolio.


<PAGE>



Noninterest Expense

The Company's noninterest expense was $2.06 million during the September 2007
quarter, compared to $1.91 million during the 2006 three month period. Excluding
the 2007 second quarter branch property write off of $148,000, noninterest
expense for the nine months ended September 30, 2007 was $6.13 million, compared
to $5.67 million during the 2006 nine month period. The expense for the first
nine months of 2007 included additional personnel employed to enhance the
Company's loan administration, operations, mortgage banking and internet banking
divisions, as well as, normal annual salary and benefit adjustments. These
additional personnel and enhancements should enable the Company to further
capitalize on the growth opportunities existing in its markets. Fluctuations in
other expense categories were fairly nominal when compared to the 2006 period.


Financial Condition

The Company's total assets were $269.1 million at September 30, 2007, compared
to $260.7 million at December 31, 2006. The Company experienced 2.1% growth in
assets during the third quarter, spearheaded by a $3.1 million increase in net
loans from June 2007 to September 2007. Although the real estate market
continues to be weak the Bank is still experiencing activity in the residential
real estate and commercial lending sectors as a result of opportunities created
by recent bank mergers and bank consolidation.

Deposits were $199.7 million at September 30, 2007, compared to $198.1 million
at December 31, 2006. Noninterest-bearing deposits grew $3.2 million, or 12.6%,
during the first nine months of 2007, while interest-bearing deposits were down
$1.7 million. $2.9 million in brokered deposits matured during the second
quarter which contributed to the decline in interest-bearing deposits.

Stockholders' equity was $27.5 million at September 30, 2007, representing an
increase of $1.33 million since December 31, 2006. This increase is made up of
comprehensive income of $1.83 million, consisting primarily of $1.94 million of
net income, offset by common stock dividends of $524,700 ($0.21 per share)
during the period.

During October 2007, the Company declared a $0.08 per share quarterly cash
dividend on its common stock payable on November 1, 2007 to shareholders of
record on October 23, 2007.

Asset Quality

Loans are placed on nonaccrual status when, in the judgment of management, the
probability of interest collection is deemed to be insufficient to warrant
further accrual or the loan reaches 90 days delinquent whereby the loan no
longer accrues interest until it has remained current for six months.

Total nonperforming assets, which consist of nonaccrual loans and foreclosed
properties, adjusted for estimated losses upon sale and the related selling
expenses and holding costs, were $709,000 at September 30, 2007, compared to
$931,000 at December 31, 2006. As to nonaccrual loans existing at September 30,
2007, approximately $11,000 of interest income would have been recognized during
the nine months then ended if interest thereon had accrued. Included in
nonaccrual loans are two loans totaling $146,000 to the same borrower that the
Bank has identified as impaired under the guidelines established by SFAS No.
114, Accounting by Creditors for Impairment of a Loan, as amended by SFAS No.
118, Accounting by Creditors for Impairment of a Loan - Income Recognition and
Disclosures. The Bank has determined that its total exposure on these loans is
approximately $139,000 and, accordingly, has allocated a specific reserve in
that amount. Although these loans were current at September 30, 2007, the Bank
will recognize interest income on a cash basis going forward.


<PAGE>



At September 30, 2007, all loans 60 days or more delinquent, including
nonperforming loans, totaled $1.1 million. In addition, other performing loans,
totaling $7.7 million, existed that were current, but had other potential
weaknesses that management considers to warrant additional monitoring. Loans in
this category, along with the delinquent loans, are subject to management
attention, and their status is reviewed on a regular basis.

The following table details information concerning nonaccrual and past due
loans, as well as foreclosed assets.

<TABLE>

                                                 Nonperforming Assets


                                                                           September 30,            December 31,
(Dollars In Thousands)                                                         2007                     2006
                                                                       ----------------------  ------------------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>

Nonaccrual loans:
       Commercial                                                        $                60      $                 73
       Real estate mortgage                                                              501                       832
       Home equity lines of credit                                                       143                        24
       Consumer                                                                            5                         2
                                                                           ------------------       -------------------

       Total nonaccrual loans                                                            709                       931
Other real estate owned                                                                    -                         -
                                                                           ------------------       -------------------

       Total nonperforming assets                                        $               709      $                931
                                                                           ==================       ===================

Loans past due 90 or more days
       accruing interest                                                                   -                         -
Allowance for loan losses to
       nonaccrual loans                                                              402.54%                   308.59%
Nonperforming assets to period end
       loans and other real estate owned                                               0.33%                     0.44%



</TABLE>


<PAGE>



Set forth below is a table detailing the allowance for loan losses for the
periods indicated.

<TABLE>

                                              Allowance for Loan Losses


                                                                                        September 30,
                                                                       ------------------------------------------------
(Dollars In Thousands)                                                         2007                     2006
                                                                       ----------------------  ------------------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>

Balance, beginning of period                                             $             2,873      $              2,851
Loans charged off:
       Commercial                                                                          -                         -
       Real estate mortgage                                                                -                         -
       Consumer                                                                         (119)                     (120)
                                                                       ----------------------  ------------------------

       Total loans charged-off                                                          (119)                     (120)
                                                                       ----------------------  ------------------------

Recoveries:
       Commercial                                                                          -                        19
       Real estate mortgage                                                                -                         -
       Consumer                                                                           76                        74
                                                                       ----------------------  ------------------------

       Total recoveries                                                                   76                        93
                                                                       ----------------------  ------------------------

Net recoveries (charge-offs)                                                             (43)                      (27)
Provision for loan losses                                                                 24                        50
                                                                       ----------------------  ------------------------

Balance, end of period                                                   $             2,854      $              2,874
                                                                       ======================  ========================

Allowance for loan losses to loans
       outstanding at end of period                                                    1.32%                     1.37%

Allowance for loan losses to nonaccrual
       loans outstanding at end of period                                            402.54%                   414.12%

Net charge-offs (recoveries) to average loans
       outstanding during period                                                      0.020%                    0.050%

</TABLE>



Liquidity and Capital Resources

Liquidity represents the Company's ability to meet present and future
obligations through the sale and maturity of existing assets or the acquisition
of additional funds through liability management. Liquid assets include cash,
interest-bearing deposits with banks, federal funds sold, available-for-sale
investments and investments and loans maturing within one year. In addition to
liquid assets, the Company maintains several lines of credit with other
institutions, the largest of which is with the Federal Home Loan Bank of
Atlanta, and is able to draw on other wholesale funding sources, such as the
brokered certificate of deposit market, to support liquidity. The Company's
ability to obtain deposits and purchase funds at favorable rates determines its
liability liquidity.

At September 30, 2007, the Company had outstanding loan, line of credit and
letter of credit commitments of $53.3 million. Scheduled maturities of
certificate of deposits during the twelve months following September 30, 2007
amounted to $80.0 million. Historically, the Company has been able to retain a
significant amount of its deposits as they mature. As a result of the Company's
management of liquid assets and the ability to generate liquidity through
liability funding, management believes that the Company maintains overall
liquidity that is sufficient to satisfy its depositors' requirements and meet
its customers' credit needs.


<PAGE>



Total cash and cash equivalents increased $5.07 million for the nine months
ended September 30, 2007, compared to an increase of $2.80 million for the nine
months ended September 30, 2006. Net cash from operating activities was $2.33
million for the 2007 nine month period, compared to $2.55 million during the
same period of 2006. The changes reflect fluctuations in normal operating
activities.

Net cash used in investing activities was $3.73 million during the nine months
ended September 30, 2007, compared to net cash used in investing activities of
$13.07 million for the 2006 nine month period. Stronger loan growth and more
investing activity during the first nine months of 2006 than what occurred
during 2007 accounted for the majority of the difference.

Net cash from financing activities was $6.47 million for the nine months ended
September 30, 2007, compared to net cash from financing activities of $13.33
million for the 2006 nine month period. The Bank was steadily growing time
deposits during the first nine months of 2006 to meet liquidity needs whereas
the Bank has been less aggressive in this area in 2007 and more active in
growing demand deposits.

The Company is subject to various capital requirements administered by the
regulatory banking agencies. Failure to meet minimum capital requirements can
initiate certain mandatory and possibly additional discretionary actions by
regulators that, if undertaken, could have a direct material effect on the
Company's financial statements. Under capital adequacy guidelines and the
regulatory framework for prompt corrective action, the Company and its banking
subsidiary must meet specific capital guidelines that involve quantitative
measures of assets, liabilities, and certain off-balance-sheet items as
calculated under regulatory accounting practices. Additionally, certain
restrictions exist on dividends paid and loans or advances made by the Bank to
the Company. The total amount of dividends that may be paid at any date is
generally limited to the retained earnings for the Bank, and loans and advances
are limited to 10 percent of the Bank's capital and surplus on a secured basis.
The Bank paid $700,000 of dividends to the Company during the first nine months
of 2007, while it paid $1.0 million in dividends to the Company during the nine
months ended September 30, 2006. At September 30, 2007, the Bank's retained
earnings available for the payment of dividends was $4.0 million. The capital
amounts and classification are also subject to qualitative judgments by the
regulators about components, risk weightings, and other factors.

Quantitative measures established by regulation to ensure capital adequacy
require the Company and its banking subsidiary to maintain minimum amounts and
ratios of total and Tier I capital (as defined in the regulations) to
risk-weighted assets (as defined), and of Tier I capital (as defined) to average
assets (as defined). At September 30, 2007, the Company meets all capital
adequacy requirements to which it is subject.


<PAGE>



The following table details the components of Tier 1 and Tier 2 capital and
related ratios at September 30, 2007 and December 31, 2006.

<TABLE>

                                    Analysis of Capital

                                                       September 30,        December 31,
(Dollars In Thousands)                                      2007                2006
                                                     -------------------  ------------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>

Tier 1 Capital:
       Common stock                                   $             688    $            687
       Additional paid-in capital                                 8,400               8,373
       Retained earnings                                         18,371              16,953
       Accumulated other comprehensive income                         2                 113
                                                        ----------------     ---------------
             Total capital (GAAP)                                27,461              26,126
       Less: Intangibles                                           (355)               (402)
       Net unrealized gain on debt and equity securities             (2)               (113)
                                                        ----------------     ---------------
             Total Tier 1 capital                                27,104              25,611


Tier 2 Capital:
       Allowable allowances for loan losses                       2,307               2,269
       Net unrealized gains on equity securities                     33                 180
                                                        ----------------     ---------------
             Total Tier 2 capital                     $          29,444    $         28,060
                                                        ================     ===============

Risk-weighted assets                                  $         188,908    $        185,991

Capital Ratios (1):
       Tier 1 risk-based capital ratio                           14.35%              13.77%
       Total risk-based capital ratio                            15.59%              15.09%
       Tier 1 capital to average adjusted
             total assets                                        10.35%               9.93%


</TABLE>



Item 3 - Quantitative and Qualitative Disclosures about Market Risk

The Company uses a third party provider to perform computer modeling
methodologies that assist in determining the overall magnitude of interest
sensitivity risk. Based on these methodologies, management formulates policies
governing asset generation and pricing, funding sources and pricing, and
off-balance-sheet commitments in order to reduce sensitivity risk. Management
considers the current interest rate environment, the state of the local and
national economy and other financial and business risk factors when making these
decisions.

The modeling methodologies used measure interest rate sensitivity by analyzing
the potential impact on net interest income under various interest rate
scenarios. One such scenario would assume a hypothetical 200 basis point
instantaneous and parallel shift in the interest rate yield curve. Accordingly,
management modeled the impact of a 200 basis point decline in interest rates and
a 200 basis point increase in interest rates at September 30, 2007. In the
model, a 200 basis point instantaneous and parallel decrease in the yield curve
in interest rates would cause net interest income to decrease by $167,000 while
a 200 basis point instantaneous and parallel increase in the yield curve in
interest rates would cause net interest income to decrease by $43,000.



<PAGE>



The computer model uses a standard algebraic formula for calculating present
value. The calculation discounts the future cash flows of the Company's
portfolio of interest rate sensitive instruments to present value utilizing
techniques designed to approximate current market rates for securities, current
offering rates for loans, and the cost of alternative funding for the given
maturity of deposits and then assumes an instantaneous and parallel shift in
these rates. The difference between these numbers represents the resulting
hypothetical change in the fair value of interest rate sensitive instruments.

As with any modeling techniques, certain limitations and shortcomings are
inherent in the Company's methodology. Significant assumptions must be made in
the calculation including: (1) growth in volume or balance sheet mix; (2)
constant market interest rates reflecting the average rate from the last month
of the given quarter; and (3) pricing spreads to market rates derived from an
historical analysis, or from assumptions by instrument type. Additionally, the
computations do not contemplate certain actions management could undertake in
response to changes in interest rates.


Item 4 - Controls and Procedures

Under the supervision and with the participation of our management, including
our principal executive officer and principal financial officer, we have
evaluated the effectiveness of the design and operation of our disclosure
controls and procedures as of the end of the quarter. Based on that evaluation,
our principal executive officer and principal financial officer have concluded
that these controls and procedures are effective. There were no significant
changes in our internal controls or in other factors that could significantly
affect these controls subsequent to the date of their evaluation.

Controls and other procedures are designed to ensure that information required
to be disclosed by us in the reports that we file or submit under the Exchange
Act is accumulated and communicated to our management, including our principal
executive officer and principal financial officer, as appropriate, to allow
timely decisions regarding required disclosure.


<PAGE>



                           PART II - OTHER INFORMATION

Item 1 - Legal Proceedings

In the ordinary course of its operations, the Company is a party to various
legal proceedings. Based upon information currently available, management
believes that such legal proceedings, in the aggregate, will not have a material
adverse effect on the business, financial condition, or results of operations of
the Company.

Item 1A - Risk Factors

There has been no material changes in the risk factors as previously disclosed
in response to Item 1A. Part I of the Company's December 31, 2006 Form 10-K.

Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3 - Defaults Upon Senior Securities

Not applicable.

Item 4 - Submission of Matters to a Vote of Stockholders

None.

Item 5 - Other Information

None.

Item 6 - Exhibits

(a)      Certifications pursuant to subsections 302 and 906 of the
Sarbanes-Oxley Act of 2002.
(b) Form 8-K was filed during July 2007 relative to the Company's June 30, 2007
earnings release dated July 17, 2007. (c) Form 8-K was filed during July 2007
relative to the Bank's plans to open a new banking location in Pocomoke,
Maryland.



<PAGE>



                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.


/s/ Scott C. Harvard                                         November 13, 2007
-------------------------------------------------------------
Scott C. Harvard
President and
Chief Executive Officer

/s/ Steven M. Belote                                         November 13, 2007
-------------------------------------------------------------
Steven M. Belote
Senior Vice President and
Chief Financial Officer


<PAGE>



                                                                   Exhibit 31.1

                                 CERTIFICATIONS


I, Scott C. Harvard, certify that:

      1. I have reviewed this quarterly report on Form 10-Q of Shore Financial
Corporation;

      2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;


      3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;


      4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:


             (a) designed such disclosure controls and procedures, or caused
        such disclosure controls and procedures to be designed under our
        supervision, to ensure that material information relating to the
        registrant, including its consolidated subsidiaries, is made known to us
        by others within those entities, particularly during the period in which
        this report is being prepared;

             (b) evaluated the effectiveness of the registrant's disclosure
        controls and procedures and presented in this report our conclusions
        about the effectiveness of the disclosure controls and procedures, as of
        the end of the period covered by this report based on such evaluation;
        and

             (c) disclosed in this report any change in the registrant's
        internal control over financial reporting that occurred during the
        registrant's most recent fiscal quarter (the registrant's fourth fiscal
        quarter in the case of an annual report) that has materially affected,
        or is reasonably likely to materially affect, the registrant's internal
        control over financial reporting; and


      5. The registrant's other certifying officer(s) and I have disclosed,
based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the equivalent
functions):


             (a) all significant deficiencies and material weaknesses in the
        design or operation of internal control over financial reporting which
        are reasonably likely to adversely affect the registrant's ability to
        record, process, summarize and report financial information; and

             (b) any fraud, whether or not material, that involves management or
        other employees who have a significant role in the registrant's internal
        control over financial reporting.


Date: November 13, 2007
                              /s/ Scott C. Harvard
                              --------------------------------------
                              Scott C. Harvard
                              President and Chief Executive Officer

<PAGE>



                                                                   Exhibit 31.2

                                 CERTIFICATIONS


I, Steven M. Belote, certify that:

      1. I have reviewed this quarterly report on Form 10-Q of Shore Financial
Corporation;

      2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;


      3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;


      4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:


             (a) designed such disclosure controls and procedures, or caused
        such disclosure controls and procedures to be designed under our
        supervision, to ensure that material information relating to the
        registrant, including its consolidated subsidiaries, is made known to us
        by others within those entities, particularly during the period in which
        this report is being prepared;

             (b) evaluated the effectiveness of the registrant's disclosure
        controls and procedures and presented in this report our conclusions
        about the effectiveness of the disclosure controls and procedures, as of
        the end of the period covered by this report based on such evaluation;
        and

             (c) disclosed in this report any change in the registrant's
        internal control over financial reporting that occurred during the
        registrant's most recent fiscal quarter (the registrant's fourth fiscal
        quarter in the case of an annual report) that has materially affected,
        or is reasonably likely to materially affect, the registrant's internal
        control over financial reporting; and


      5. The registrant's other certifying officer(s) and I have disclosed,
based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the equivalent
functions):


             (a) all significant deficiencies and material weaknesses in the
        design or operation of internal control over financial reporting which
        are reasonably likely to adversely affect the registrant's ability to
        record, process, summarize and report financial information; and

             (b) any fraud, whether or not material, that involves management or
        other employees who have a significant role in the registrant's internal
        control over financial reporting.


Date: November 13, 2007
                              /s/ Steven M. Belote
                              -------------------------------------------------
                              Steven M. Belote
                              Chief Financial Officer and Senior Vice President

<PAGE>




                                                                   Exhibit 32.1



                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


         In connection with the Quarterly Report of Shore Financial Corporation
(the "Company") on Form 10-Q for the three months ended September 30, 2007 as
filed with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Scott C. Harvard, Chief Executive Officer of the Company, certify,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:

         (1)      The Report fully complies with the requirements of
Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

         (2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Company.


                              /s/ Scott C. Harvard
                              ------------------------------------------
                              Scott C. Harvard
                              President and Chief Executive Officer

Date:  November 13, 2007





This certificate accompanies this Quarterly Report on Form 10-Q pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 and will not be deemed "filed" by
the Company for purposes of Section 18 of the Securities Exchange Act of 1934,
as amended.


<PAGE>


                                                                   Exhibit 32.1



                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


         In connection with the Quarterly Report of Shore Financial Corporation
(the "Company") on Form 10-Q for the three months ended September 30, 2007 as
filed with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Steven M. Belote, Chief Financial Officer of the Company, certify,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:

         (1)      The Report fully complies with the requirements of
Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

         (2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Company.


                              /s/ Steven M. Belote
                              -------------------------------------------------
                              Steven M. Belote
                              Chief Financial Officer and Senior Vice President

Date:  November 13, 2007





This certificate accompanies this Quarterly Report on Form 10-Q pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 and will not be deemed "filed" by
the Company for purposes of Section 18 of the Securities Exchange Act of 1934,
as amended.