Exhibit 99.1
PRESS RELEASE

For Immediate Release - April 1, 2004

FOR MORE INFORMATION, CONTACT:

W. Moorhead Vermilye - President, Shore Bancshares, Inc.
(410) 822-1400

Thomas Evans, President and CEO, The Felton Bank
(302) 284-1630

                     SHORE BANCSHARES AND MIDSTATE BANCORP
                                COMPLETE MERGER

 Easton, Maryland and Felton, Delaware,  April 1, 2004 - Shore Bancshares,  Inc.
 (Nasdaq: SHBI),  headquartered in Easton, Maryland, and Midstate Bancorp, Inc.,
 headquartered  in  Felton,  Delaware,  announced  jointly  today that they have
 completed the merger of Midstate Bancorp with and into Shore  Bancshares.  As a
 result of the merger,  The Felton Bank, a Delaware bank,  became a wholly-owned
 subsidiary of Shore Bancshares.

 Under the terms of the merger  agreement,  each  outstanding  share of Midstate
 Bancorp common stock will be exchanged for (i) $31.00 in cash, plus (ii) 0.8732
 shares  of Shore  Bancshares  common  stock,  with cash  being  paid in lieu of
 fractional shares at the rate of $33.83 per share. Shore Bancshares anticipates
 that it will  pay  approximately  $2,953,710  in cash and  issue  approximately
 82,786 shares of common stock to stockholders of Midstate Bancorp in connection
 with the  merger.  Prior to the  merger,  Shore  Bancshares  had  approximately
 5,409,967 shares of common stock issued and outstanding.

 "We are very excited  about the  opportunities  that Shore  Bancshares  and The
 Felton  Bank  will  have as a result  of the  merger,"  commented  W.  Moorhead
 Vermilye,  President  and  CEO  of  Shore  Bancshares.  "We  believe  that  the
 acquisition  of The Felton Bank is another step towards  achieving  our goal of
 becoming the premier financial services company in the region."

 "We are  happy to be part of the  Shore  Bancshares  family,"  said Tom  Evans,
 President  and CEO of The Felton  Bank.  "We  believe  that this merger and the
 resulting  relationship  with Shore  Bancshares and its affiliates will provide
 The Felton Bank with a myriad of  resources  that will help us meet the growing
 banking needs of our customers."

 Prior to the merger,  Midstate Bancorp had assets of approximately $51 million.
 The  Felton  Bank  operates  an office  in  Felton,  Delaware  and an office in
 Milford,  Delaware.  W.  Edwin  Kee,  Jr.,  Chairman  of the Board of  Midstate
 Bancorp,  will be appointed to the Board of Directors of Shore  Bancshares  and
 Thomas  Evans,  President  of The Felton Bank,  will  continue to serve in that
 capacity.

 Shore  Bancshares,  Inc.,  with assets of  approximately  $705 million,  is the
 largest  independent  financial holding company located on the Eastern Shore of
 Maryland.  Shore  Bancshares  is also the parent  company of The Talbot Bank of
 Easton,  Maryland located in Easton, Maryland and The Centreville National Bank
 of Maryland  located in Centreville,  Maryland,  which together operate 12 full
 service  branches in the  Maryland  counties  of Kent,  Queen  Anne's,  Talbot,
 Caroline  and  Dorchester.  Shore  Bancshares  offers a full range of insurance
 products and services to its  customers  through The  Avon-Dixon  Agency,  LLC,
 Elliott Wilson Insurance, LLC, and Mubell Finance, LLC, and investment advisory
 services  through Wye Financial  Services,  LLC, all of which are  wholly-owned
 subsidiaries.

 This  press  release  contains  forward-looking  statements  as  defined by the
 Private Securities  Litigation Reform Act of 1995.  Forward-looking  statements
 present  management's  expectations,  beliefs,  plans and objectives  regarding
 future  financial  performance,  and  assumptions or judgments  concerning such
 performance.  Any  discussions  contained in this press release,  except to the
 extent that they contain historical facts, are  forward-looking and accordingly
 involve estimates, assumptions, judgments and uncertainties. There are a number
 of factors  that could cause  actual  results or outcomes to differ  materially
 from those  addressed  in the  forward-looking  statements.  Such  factors  are
 detailed in "Risk  Factors"  in Item 1 of Part I of the Annual  Report of Shore
 Bancshares,  Inc. on Form 10-K for the year ended December 31, 2003.  Except as
 required by applicable laws, Shore Bancshares,  Inc. does not intend to publish
 updates or revisions of any forward-looking  statements it makes to reflect new
 information, future events or otherwise.