MainStreet Bancshares, Inc. Reports Strong Net Income as Interest Rates Rise

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July 25, 2022 8:00 AM EDT

FAIRFAX, Va., July 25, 2022 /PRNewswire/ -- MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the holding company for MainStreet Bank, said its net interest margin widened as rates climbed in recent months, driving strong net income for the second quarter and six months ended June 30, 2022.The Bank's loan portfolio is well positioned for increasing interest rates. "The FOMC's next announcement is due to be released on July 27 and based upon Street consensus we anticipate continued net interest margin expansion," said Jeff W. Dick, Chairman & CEO of MainStreet Bancshares, Inc. and MainStreet Bank."We have been anticipating this trend for some time and we strategically aligned our portfolio to flex as the economy shifts," Dick said. "Even as we focus on maintaining a rigorous credit culture, we are constantly looking to the future, sharpening our understanding of what clients demand in an evolving financial services market, and choosing to innovate."A focal point of MainStreet Bank's innovation is its Avenu™ Software as a Service (SaaS) and Banking as a Service (BaaS) platform. Dick and other MainStreet Bank executives will discuss quarterly and half-year earnings and preview business developments at Avenu™ during its virtual webcast and quarterly earnings call at 2 p.m. Eastern time today.Net income totaled $5.9 million for three months ended June 30, and $11.4 million for the six months ended June 30. Net interest income totaled $16.1 million in the second quarter, 6% higher than the immediately preceding quarter and 24.1% higher than the comparable period in 2021. 

Rising interest rates propelled the net interest margin higher by 75 basis points to 3.95% for the quarter ended June 30, versus 3.20% a year earlier, on a tax equivalent basis. The Company's efficiency ratio remains solid at 55%. Total assets reached $1.8 billion in the second quarter, a 5.0% increase from a year earlier.

Quarterly results represent:

  • 12.59% return on average equity
  • 1.39% return on average assets
  • $0.71 earnings per share of common stock (basic and diluted)
  • $21.41 per common share book value

The level of Accumulated Other Comprehensive Income (AOCI) for the Company is low at -$6.56 million.  The level is consistent with the size and quality of the investment portfolio, as the Bank enjoys consistent strong in-market loan demand.

The average loans outstanding rose just over 4% since the first quarter of 2022, as the bank was able to capitalize on continued demand in a higher interest rate environment. Asset quality remains pristine, as the Company had zero non-performing assets as of quarter ended June 30. Noninterest-bearing deposits represent 36% of the $1.5 billion in total deposits, and 70% of total deposits are core deposits.

"We operate in a robust market in Northern Virginia and the Washington Metropolitan area, and loan demand remains steady," said Abdul Hersiburane, president of MainStreet Bank. "The surge in loan volume that occurred for banks nationwide during the height of the COVID crisis has normalized, and what we are seeing now is solid, steady, organic loan growth that reflects the confidence of businesses in this marketplace that they have opportunities to grow." He noted that federal Paycheck Protection Program loans now represent a negligible 0.3% of the bank's loan portfolio.

Avenu™

Avenu™, a division of MainStreet Bank, that provides Software as a Service (SaaS) and Banking as a Service (BaaS), continued to generate significant customer interest as additional fintechs joined the queue for our proprietary software solution. We are currently onboarding our initial beta customer with an anticipated go-live date in the fourth quarter of 2022.

"Fintechs have a strong need for knowledgeable, credible partners who can help them manage risk and compliance obligations," said Todd Youngren, President of Avenu™. "Preparing them to become fully compliant is a critical, intensive element of this process, and we are focusing our energy on getting that right. Following the beta stage, we anticipate that onboarding will be streamlined into a 60-day process."

Youngren noted that at the end of the first quarter, Avenu™ had 10 fintechs queued up at various stages of progress, including four that have indicated they intend to move forward as soon as the beta process is complete. These prospects include entities that serve the domestic needs of foreign nationals and entities that serve the education and nonprofit industries.  Avenu has another 36 fintechs that have signed up to be "in the queue," and 128 fintechs that have signed up to receive updates and are actively monitoring our progress.

In addition to serving fintechs, the Avenu™ team has a robust array of existing customers that include payment processors and money service businesses. These relationships have been integral in identifying the needs and services that fintechs need banks to provide in order to have a successful partnership. These relationships provide the Bank with additional noninterest income and a strong source of low-cost deposits that can be integrated into the Bank's traditional source of income generation, net interest margin. As a benchmark, Youngren noted, Avenu™ is favorably impacting profitability, with its customers providing $70 million in noninterest bearing deposits and $488,000 in noninterest income in the six months ended June 30, 2022.

Refer to our press release on October 25, 2021, for additional information on the Company's proprietary Avenu™ solution. If you are a fintech looking to add payments and deposits to your solution, go to Avenu.bank and join the queue today.

ABOUT MAINSTREET BANK:  MainStreet operates six branches in Herndon, Fairfax, McLean, Leesburg, Clarendon, and Washington D.C. MainStreet Bank has 55,000 free ATMs and a fully integrated online and mobile banking solution. The Bank is not restricted by a conventional branching system, as it can offer business customers the ability to Put Our Bank in Your Office®. With robust and easy-to-use online business banking technology, MainStreet has "put our bank" in thousands of businesses in the metropolitan area.

MainStreet Bank has a robust line of business and professional lending products, including government contracting lines of credit, commercial lines and term loans, residential and commercial construction, and commercial real estate. MainStreet also works with the SBA to offer 7A and 504 lending solutions. From sophisticated cash management to enhanced mobile banking and instant-issue Debit Cards, MainStreet Bank is always looking for ways to improve our customer's experience.

MainStreet Bank was the first community bank in the Washington, DC metropolitan area to offer a full online business banking solution. MainStreet Bank was also the first bank headquartered in the Commonwealth of Virginia to offer CDARS – a solution that provides multi-million-dollar FDIC insurance. Further information on the Bank can be obtained by visiting its website at mstreetbank.com.

This release contains forward-looking statements, including our expectations with respect to future events that are subject to various risks and uncertainties. The statements contained in this release that are not historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Words such as "may," "will," "could," "should," "expect," "plan," "project," "intend," "anticipate," "believe," "estimate," "predict," "potential," "pursuant," "target," "continue," and similar expressions are intended to identify such forward-looking statements. Factors that could cause actual results to differ materially from management's projections, forecasts, estimates and expectations include: fluctuation in market rates of interest and loan and deposit pricing, adverse changes in the overall national economy as well as adverse economic conditions in our specific market areas, future impacts of the novel coronavirus (COVID-19) outbreak, maintenance and development of well-established and valued client relationships and referral source relationships, and acquisition or loss of key production personnel. We caution readers that the list of factors above is not exclusive. The forward-looking statements are made as of the date of this release, and we may not undertake steps to update the forward-looking statements to reflect the impact of any circumstances or events that arise after the date the forward-looking statements are made. In addition, our past results of operations are not necessarily indicative of future performance. 

 Contact: Jeff W. Dick, Chairman & CEO

(703) 481-4567

 

UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION

(In thousands)

June 30, 2022

March 31, 2022

December 31,2021

September 30,2021

June 30, 2021

ASSETS

Cash and cash equivalents

Cash and due from banks

$

55,636

$

63,986

$

61,827

$

67,992

$

120,121

Federal funds sold

47,013

37,756

31,372

65,725

56,164

Total cash and cash equivalents

102,649

101,742

93,199

133,717

176,285

Investment securities available for sale, at fair value

143,240

123,802

99,913

171,603

165,791

Investment securities held to maturity, at carrying value

17,698

18,769

20,349

21,148

21,181

Restricted equity securities, at cost

16,485

17,209

15,609

9,972

9,994

Loans, net of allowance for loan losses of $12,982,      $12,500, $11,697,$11,428, and $11,133, respectively

1,416,875

1,413,238

1,341,760

1,246,331

1,256,436

Premises and equipment, net

14,756

14,833

14,863

14,795

13,929

Other real estate owned, net

—

—

775

1,158

1,158

Accrued interest and other receivables

7,313

6,980

7,701

4,718

8,752

Computer software, net of amortization

4,956

3,906

2,493

1,165

—

Bank owned life insurance

36,742

36,492

36,241

35,987

35,736

Other assets

32,665

24,777

14,499

16,605

18,433

Total Assets

$

1,793,379

$

1,761,748

$

1,647,402

$

1,657,199

$

1,707,695

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Non-interest bearing deposits

$

535,591

$

514,160

$

530,678

$

475,157

$

486,001

Interest bearing DDA deposits

99,223

76,286

69,232

63,622

68,028

Savings and NOW deposits

58,156

81,817

85,175

79,556

72,353

Money market deposits

231,207

301,842

267,730

310,776

310,303

Time deposits

575,950

460,839

459,148

485,255

528,247

Total deposits

1,500,127

1,434,944

1,411,963

1,414,366

1,464,932

Federal Home Loan Bank advances and other borrowings

—

40,000

—

—

—

Subordinated debt

72,047

71,955

29,294

40,635

40,576

Other liabilities

32,801

26,053

17,357

18,169

22,559

Total Liabilities

1,604,975

1,572,952

1,458,614

1,473,170

1,528,067

Stockholders' Equity:

Preferred stock

27,263

27,263

27,263

27,263

27,263

Common stock

29,178

29,642

29,466

29,462

29,446

Capital surplus

64,822

66,798

67,668

67,152

66,667

Retained earnings

73,702

68,691

64,194

59,920

55,676

Accumulated other comprehensive income (loss)

(6,561)

(3,598)

197

232

576

Total Stockholders' Equity

188,404

188,796

188,788

184,029

179,628

Total Liabilities and Stockholders' Equity

$

1,793,379

$

1,761,748

$

1,647,402

$

1,657,199

$

1,707,695

 

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION

(In thousands, except share and per share data)

Year-to-Date

Three Months Ended

June 30, 2022

June 30, 2021

June 30, 2022

March 31, 2022

December 31, 2021

September 30, 2021

June 30, 2021

INTEREST INCOME:

Interest and fees on loans

$

34,639

$

31,049

$

17,954

$

16,685

$

15,532

$

15,162

$

15,257

Interest on investment securities

Taxable securities

758

592

401

357

327

318

332

Tax-exempt securities

535

535

263

272

283

267

265

Interest on federal funds sold

229

35

195

34

61

38

20

Total interest income

36,161

32,211

18,813

17,348

16,203

15,785

15,874

INTEREST EXPENSE:

Interest on interest bearing DDA deposits

170

110

105

65

59

60

55

Interest on savings and NOW deposits

79

89

42

37

38

38

47

Interest on money market deposits

270

497

151

119

127

148

220

Interest on time deposits

2,961

4,244

1,530

1,431

1,574

1,795

1,994

Interest on Federal Home Loan Bank      advances and other borrowings

83

—

52

31

—

—

—

Interest on subordinated debt

1,280

805

812

468

539

541

567

Total interest expense

4,843

5,745

2,692

2,151

2,337

2,582

2,883

Net interest income

31,318

26,466

16,121

15,197

13,866

13,203

12,991

Provision for (recovery of) loan losses

1,280

(1,760)

480

800

295

290

(2,080)

Net interest income after provision      for (recovery of) loan losses

30,038

28,226

15,641

14,397

13,571

12,913

15,071

NON-INTEREST INCOME:

Deposit account service charges

1,209

1,160

597

611

624

642

621

Bank owned life insurance income

500

395

250

251

253

252

218

Loan swap fee income

100

—

101

—

83

—

—

Net gain on held-to-maturity securities

4

3

4

—

3

—

—

Net gain (loss) on sale of loans

43

474

—

43

413

(40)

130

Other fee income

569

969

312

257

247

632

586

Total other income

2,425

3,001

1,264

1,162

1,623

1,486

1,555

NON-INTEREST EXPENSES:

Salaries and employee benefits

11,152

9,430

5,604

5,548

5,029

4,847

4,663

Furniture and equipment expenses

1,316

1,026

659

657

726

716

500

Advertising and marketing

980

677

574

406

450

438

402

Occupancy expenses

693

693

352

341

449

399

387

Outside services

935

616

567

368

485

292

280

Administrative expenses

405

291

195

210

192

202

141

Other operating expenses

2,976

2,950

1,543

1,433

1,389

1,567

1,500

Total other expenses

18,457

15,683

9,494

8,963

8,720

8,461

7,873

Income before income tax expense

14,006

15,544

7,411

6,596

6,474

5,938

8,753

Income tax expense

2,654

2,969

1,481

1,173

1,660

1,155

1,627

Net Income

11,352

12,575

5,930

5,423

4,814

4,783

7,126

Preferred stock dividends

1,078

1,078

539

539

539

539

539

Net income available to common      shareholders

$

10,274

$

11,497

$

5,391

$

4,884

$

4,275

$

4,244

$

6,587

Net income per common share, basic and diluted

$

1.35

$

1.53

$

0.71

$

0.64

$

0.56

$

0.56

$

0.87

Weighted average number of common      shares, basic and diluted

7,611,303

7,535,061

7,575,484

7,647,519

7,595,062

7,571,214

7,546,452

 

UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL

(In thousands)

June 30, 2022

March 31, 2022

June 30, 2021

Percentage Change

$ Amount

% of Total

$ Amount

% of Total

$ Amount

% of Total

Last 3 Mos

Last 12 Mos

LOANS:

Construction and land development loans

$

358,062

25.0

%

$

344,605

24.1

%

$

328,480

25.8

%

3.9

%

9.0

%

Residential real estate loans

366,758

25.6

%

367,138

25.7

%

190,426

14.9

%

-0.1

%

92.6

%

Commercial real estate loans

599,683

41.8

%

588,004

41.1

%

503,514

39.5

%

2.0

%

19.1

%

Commercial industrial loans - Other

88,628

6.2

%

92,408

6.5

%

93,837

7.4

%

-4.1

%

-5.6

%

Commercial industrial loans - PPP Loans

4,044

0.3

%

18,776

1.3

%

124,578

9.8

%

-78.5

%

-96.8

%

Consumer loans

17,223

1.1

%

19,711

1.3

%

33,643

2.6

%

-12.6

%

-48.8

%

Total Gross Loans

$

1,434,398

100.0

%

$

1,430,642

100.0

%

$

1,274,478

100.0

%

0.3

%

12.5

%

Less: Allowance for loan losses

(12,982)

(12,500)

(11,133)

Net deferred loan fees

(4,541)

(4,904)

(6,909)

Net Loans

$

1,416,875

$

1,413,238

$

1,256,436

DEPOSITS:

Non-interest bearing demand deposits

$

535,591

35.7

%

$

514,160

35.8

%

$

486,001

33.2

%

4.2

%

10.2

%

Interest-bearing demand deposits:

Demand deposits

99,223

6.6

%

76,286

5.3

%

68,028

4.6

%

30.1

%

45.9

%

Savings and NOW deposits

58,156

3.9

%

81,817

5.7

%

72,353

4.9

%

-28.9

%

-19.6

%

Money market accounts

231,207

15.4

%

301,842

21.0

%

310,303

21.2

%

-23.4

%

-25.5

%

Certificates of deposit $250,000 or more

383,340

25.6

%

292,978

20.4

%

303,769

20.7

%

30.8

%

26.2

%

Certificates of deposit less than $250,000

192,610

12.8

%

167,861

11.8

%

224,478

15.4

%

14.7

%

-14.2

%

Total Deposits

$

1,500,127

100.0

%

$

1,434,944

100.0

%

$

1,464,932

100.0

%

4.5

%

2.4

%

BORROWINGS:

Federal Home Loan Bank advances

—

0.0

%

40,000

35.7

%

—

—

100.0

%

0.0

%

Subordinated debt

72,047

100.0

%

71,955

64.3

%

40,576

100.0

%

0.1

%

77.6

%

Total Borrowings

$

72,047

100.0

%

$

111,955

100.0

%

$

40,576

100.0

%

-35.6

%

77.6

%

Total Deposits and Borrowings

$

1,572,174

$

1,546,899

$

1,505,508

1.6

%

4.4

%

Core customer funding sources (1)

$

1,094,493

69.6

%

$

1,135,503

73.4

%

$

1,118,795

74.3

%

-3.6

%

-2.2

%

Brokered and listing service sources (2)

405,634

25.8

%

299,441

19.4

%

346,137

23.0

%

35.5

%

17.2

%

Federal Home Loan Bank advances

—

0.0

%

40,000

2.6

%

—

—

100.0

%

0.0

%

Subordinated debt (3)

72,047

4.6

%

71,955

4.6

%

40,576

2.7

%

0.1

%

77.6

%

Total Funding Sources

$

1,572,174

100.0

%

$

1,546,899

100.0

%

$

1,505,508

100.0

%

1.6

%

4.4

%

(1)

Includes ICS, CDARS, and reciprocal deposits maintained by customers, which represent sweep accounts tied to customer operating accounts

(2)

Consists of certificates of deposit (CD) through multiple listing services and multiple brokered deposit services, as well as ICS and CDARS one-way certificates of deposit and regional money market accounts

(3)

Subordinated debt obligation qualifies as Tier 2 capital at the holding company and Tier 1 capital at the Bank

 

UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES

(In thousands)

For the three months ended June 30, 2022

For the three months ended June 30, 2021

Average Balance

Interest Income/ Expense (4)(5)

Average Yields/ Rate (annualized) (4)(5)

Average Balance

Interest Income/ Expense (4)(5)

Average Yields/Rate (annualized) (4)(5)

ASSETS:

Interest earning assets:

Loans (1)(2)(3)

$

1,434,877

$

17,954

5.02

%

$

1,302,722

$

15,257

4.70

%

Securities:

Taxable

73,153

401

2.20

%

54,810

332

2.43

%

Tax-exempt

38,507

333

3.47

%

36,010

335

3.74

%

Federal funds and interest-bearing deposits

98,326

195

0.80

%

245,257

20

0.03

%

Total interest earning assets

$

1,644,863

$

18,883

4.60

%

$

1,638,799

$

15,944

3.90

%

Other assets

65,225

69,950

Total assets

$

1,710,088

$

1,708,749

Liabilities and Stockholders' Equity:

Interest-bearing liabilities:

Interest-bearing demand deposits

$

96,352

$

105

0.44

%

$

68,714

$

55

0.32

%

Savings and NOW deposits

62,588

42

0.27

%

71,747

47

0.26

%

Money market deposit accounts

234,097

151

0.26

%

322,332

220

0.27

%

Time deposits

499,734

1,530

1.23

%

538,766

1,994

1.48

%

Total interest-bearing deposits

$

892,771

$

1,828

0.82

%

$

1,001,559

$

2,316

0.93

%

Federal funds purchased

1

—

—

1

—

—

Subordinated debt

72,009

812

4.52

%

39,716

567

5.73

%

FHLB borrowings

35,275

52

0.59

%

—

—

—

Total interest-bearing liabilities

$

1,000,056

$

2,692

1.08

%

$

1,041,276

$

2,883

1.11

%

Demand deposits and other liabilities

521,130

491,857

Total liabilities

$

1,521,186

$

1,533,133

Stockholders' Equity

188,902

175,616

Total Liabilities and Stockholders' Equity

$

1,710,088

$

1,708,749

Interest Rate Spread

3.52

%

2.84

%

Net Interest Income

$

16,191

$

13,061

Net Interest Margin

3.95

%

3.20

%

(1)

Includes loans classified as non-accrual

(2)

Includes average PPP balances of $11.4 million, related interest income of approximately $28,000, and $392,000 in PPP fees recognized for the three months ended June 30, 2022. Includes average PPP balances of $161.8 million, related interest income of approximately $404,000, and $1.2 million in PPP fees recognized for the three months ended June 30, 2021

(3)

Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs

(4)

Income and yields for all periods presented are reported on a tax-equivalent basis using the federal statutory rate of 21%

(5)

Refer to Appendix for reconciliation of non-GAAP measures

 

UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES

(In thousands)

For the six months ended June 30, 2022

For the six months ended June 30, 2021

Average Balance

Interest Income/ Expense (4)(5)

Average Yields/ Rate(annualized) (4)(5)

AverageBalance

InterestIncome/Expense (4)(5)

AverageYields/ Rate (annualized) (4)(5)

ASSETS:

Interest earning assets:

Loans (1)(2)(3)

$

1,406,457

$

34,639

4.97

%

$

1,311,085

$

31,049

4.78

%

Securities:

Taxable

73,283

758

2.09

%

54,100

592

2.21

%

Tax-exempt

39,023

677

3.50

%

36,247

677

3.77

%

Federal funds and interest-bearing deposits

91,081

229

0.51

%

219,648

35

0.03

%

Total interest earning assets

$

1,609,844

$

36,303

4.55

%

$

1,621,080

$

32,353

4.02

%

Other assets

76,387

70,337

Total assets

$

1,686,231

$

1,691,417

Liabilities and Stockholders' Equity:

Interest-bearing liabilities:

Interest-bearing demand deposits

$

83,450

$

170

0.41

%

$

68,556

$

110

0.32

%

Savings and NOW deposits

72,617

79

0.22

%

70,875

89

0.25

%

Money market deposit accounts

250,908

270

0.22

%

367,424

497

0.27

%

Time deposits

478,376

2,961

1.25

%

509,465

4,244

1.68

%

Total interest-bearing deposits

$

885,351

$

3,480

0.79

%

$

1,016,320

$

4,940

0.98

%

Federal funds and repos purchased

1

—

—

—

—

—

Subordinated debt

58,079

1,280

4.44

%

27,346

805

5.94

%

FHLB borrowings

36,215

83

0.46

%

—

—

—

Total interest-bearing liabilities

$

979,646

$

4,843

1.00

%

$

1,043,666

$

5,745

1.11

%

Demand deposits and other liabilities

517,281

474,566

Total liabilities

$

1,496,927

$

1,518,232

Stockholders' Equity

189,304

173,185

Total Liabilities and Stockholders' Equity

$

1,686,231

$

1,691,417

Interest Rate Spread

3.55

%

2.91

%

Net Interest Income

$

31,460

$

26,608

Net Interest Margin

3.94

%

3.31

%

(1)

Includes loans classified as non-accrual

(2)

Includes average PPP balances of $25.2 million, related interest income of approximately $126,000, and $1.7 million in PPP fees recognized for the six months ended June 30, 2022. Includes average PPP balances of $158.0 million, related interest income of approximately $790,000, and $2.8 million in PPP fees recognized for the three months ended June 30, 2021

(3)

Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs

(4)

Income and yields for all periods presented are reported on a tax-equivalent basis using the federal statutory rate of 21%

(5)

Refer to Appendix for reconciliation of non-GAAP measures

 

UNAUDITED SUMMARY FINANCIAL DATA

(Dollars in thousands except per share data)

At or For the Three Months Ended

At or For the Six Months Ended

June 30,

June 30,

2022

2021

2022

2021

Per share Data and Shares Outstanding

Earnings per common share (basic and diluted)

$

0.71

$

0.87

$

1.35

$

1.53

Book value per common share

$

21.41

$

20.18

$

21.41

$

20.18

Tangible book value per common share(2)

$

20.75

$

20.18

$

20.75

$

20.18

Weighted average common shares (basic and diluted)

7,575,484

7,546,452

7,611,303

7,535,061

Common shares outstanding at end of period

7,526,463

7,549,398

7,526,463

7,549,398

Performance Ratios

Return on average assets (annualized)

1.39

%

1.67

%

1.36

%

1.50

%

Return on average equity (annualized)

12.59

%

16.28

%

12.09

%

14.64

%

Return on average common equity (annualized)

13.38

%

17.81

%

12.79

%

15.89

%

Yield on earning assets (FTE) (2) (annualized)

4.60

%

3.90

%

4.55

%

4.02

%

Cost of interest bearing liabilities (annualized)

1.08

%

1.11

%

1.00

%

1.11

%

Net interest spread (FTE)(2)

3.52

%

2.84

%

3.55

%

2.91

%

Net interest margin (FTE)(2) (annualized)

3.95

%

3.20

%

3.94

%

3.31

%

Noninterest income as a percentage of average assets (annualized)

0.30

%

0.37

%

0.29

%

0.36

%

Noninterest expense to average assets (annualized)

2.23

%

1.85

%

2.21

%

1.87

%

Efficiency ratio(3)

54.61

%

54.12

%

54.70

%

53.22

%

Asset Quality

Commercial real estate loans to total capital (4)

366.10

%

346.23

%

366.10

%

346.23

%

Construction loans to total capital (5)

138.16

%

154.63

%

138.16

%

154.63

%

Loans 30-89 days past due to total gross loans

0.01

%

0.07

%

0.01

%

0.07

%

Loans 90 days past due to total gross loans

0.00

%

0.00

%

0.00

%

0.00

%

Non-accrual loans to total gross loans

0.00

%

0.00

%

0.00

%

0.00

%

Other real estate owned

$

—

$

1,158

$

—

$

1,158

Non-performing assets

$

—

$

1,158

$

—

$

1,158

Non-performing assets to total assets

0.00

%

0.07

%

0.00

%

0.07

%

Allowance for loan losses to total gross loans

0.91

%

0.87

%

0.91

%

0.87

%

Allowance for loan losses to non-performing assets

N/A

9.61

N/A

9.61

Net loan charge-offs (recoveries)

$

(2)

$

2

$

(5)

$

(16)

Net charge-offs (recoveries) to average gross loans (annualized)

N/A

N/A

N/A

N/A

Regulatory Capital Ratios (Bank only) (1)

Total risk-based capital ratio

16.23

%

16.25

%

16.23

%

16.25

%

Tier 1 risk-based capital ratio

15.42

%

15.40

%

15.42

%

15.40

%

Leverage ratio

14.34

%

11.78

%

14.34

%

11.78

%

Common equity tier 1 ratio

15.42

%

15.40

%

15.42

%

15.40

%

Other information

Closing stock price

$

22.77

$

22.58

$

22.77

$

22.58

Equity / assets

10.61

%

10.52

%

10.61

%

10.52

%

Average equity / average assets

11.05

%

10.28

%

11.23

%

10.24

%

Number of full time equivalent employees

146

129

146

129

# Full service branch offices

6

7

6

7

(1)

Regulatory capital ratios as of June 30, 2022 are preliminary

(2)

Refer to Appendix for reconciliation of non-GAAP measures

(3)

Efficiency ratio is calculated as non-interest expense as a percentage of net interest income and non-interest income

(4)

Commercial real estate includes only non-owner occupied and construction loans as a percentage of Bank capital

(5)

Construction loans as a percentage of Bank capital

 

Unaudited Reconciliation of Certain Non-GAAP Financial Measures

(Dollars In thousands)

For the three months ended June 30,

For the six months ended June 30,

2022

2021

2022

2021

Net interest margin (FTE)

Net interest income (GAAP)

$

16,121

$

12,991

$

31,318

$

26,466

FTE adjustment on tax-exempt securities

70

70

142

142

Net interest income (FTE) (non-GAAP)

16,191

13,061

31,460

26,608

Average interest earning assets

1,644,863

1,638,799

1,609,844

1,621,080

Net interest margin (GAAP)

3.93

%

3.18

%

3.92

%

3.29

%

Net interest margin (FTE) (non-GAAP)

3.95

%

3.20

%

3.94

%

3.31

%

For the three months ended June 30,

For the six months ended June 30,

2022

2021

2022

2021

Stockholders equity, adjusted

Total stockholders equity (GAAP)

$

188,404

$

179,628

$

188,404

$

179,628

Less: preferred stock

(27,263)

(27,263)

(27,263)

(27,263)

Total common stockholders equity (GAAP)

161,141

152,365

$

161,141

$

152,365

Less: intangible assets

4,956

—

4,956

—

Tangible common stockholders equity (non-GAAP)

156,185

152,365

156,185

152,365

Shares outstanding

7,526,463

7,549,398

7,526,463

7,549,398

Tangible book value per common share (non-GAAP)

$

20.75

$

20.18

$

20.75

$

20.18

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/mainstreet-bancshares-inc-reports-strong-net-income-as-interest-rates-rise-301592026.html

SOURCE MainStreet Bancshares, Inc.


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