MainStreet Bancshares, Inc., Reports Continued Strong Financial Performance for 2nd Quarter 2023

Net Interest Margin Continues to Outperform

FAIRFAX, Va., July 24, 2023 /PRNewswire/ — MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the holding company for MainStreet Bank, reported net income of $6.9 million for the quarter ended June 30, 2023, in line with expectations. This represents a 17.1% increase from the year-earlier second quarter.

Performance through the first half of 2023 remains very strong (returns are annualized):

Return on average assets:	1.60 %
Return on average equity:	14.87 %
Net interest margin (tax equivalent):	4.45 %
Efficiency ratio:	53.48 %
Allowance for credit losses:	1.04 %
Liquidity coverage ratio:	124 %
Core deposit ratio:	74 %
FDIC insured deposits / total deposits:	76 %
Net charge-offs:	$0
Earnings per common share:	$1.86
Tangible book value per common share:	$22.73

“The MainStreet team has done an extraordinary job of maximizing the Company’s financial performance while staying true-to-form with proper risk management practices.  We were well-prepared for a rising rate environment,” said Jeff W. Dick, Chairman and CEO of MainStreet Bancshares, Inc. and MainStreet Bank. “And the recent collapse of a few badly managed regional banks shook the industry but ultimately gave us the opportunity to tell our risk management story.”

The team has done an extraordinary job of maximizing performance while staying true to proper risk management practices

“Spurred by the FOMC rate increases, the collapse of Silicon Valley Bank also prompted an immediate jump in deposit costs for the industry,” Dick explained. “It appears that the FOMC will increase rates an additional 25 basis points when it meets on July 26^th, but the industry is sensing a slowdown in future rises thereafter.”    

The Company’s loan book totaled $1.66 billion at the end of the second quarter, up 15.7% from $1.43 billion one year earlier and up 1.3% from the first quarter.

“We are working hard for our customers and sticking to our strong underwriting standards.  Our asset quality remains pristine,” said Abdul Hersiburane, president of MainStreet Bank.  “Our business bankers and lenders are redoubling their efforts to gain deposit share in our market, and we continue to benefit from a flight to quality as discerning depositors seek the security of federal insurance for their operating funds and other large deposits.”

ABOUT AVENU™ 

Avenu™ onboarded its first client while designers and engineers completed final sprints to harden our multitenancy and cyber architecture and to accelerate implementation of a debit card for funding.  Avenu™ connects partners and their apps directly and seamlessly to MainStreet Bank’s banking core. Avenu™ is expected to accelerate MainStreet Bank’s deposit growth to support expanded lending.

Avenu™ — Banking Delivered

Avenu™ is the only embedded banking solution that connects fintechs and their apps directly and seamlessly to a bank — MainStreet Bank. We are not a sponsor bank without our own technology, and we are not a middleware software company (aggregator) without our own bank. We are Avenu™, a leading financial technology company backed by an established community business bank in the heart of Washington, D.C.

Avenu™ — Serving a Community of Innovation

Our clients are fintechs, application developers, money movers, and entrepreneurs. They all have one thing in common: They are innovating how money moves to solve real-world issues and help communities thrive. We are focused on servicing our community and long-term business relationships.

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, D.C., 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.

UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION
(In thousands)
		June 30, 2023				March 31, 2023				December 31, 2022				September 30, 2022				June 30, 2022
ASSETS
Cash and cash equivalents
Cash and due from banks		$	67,700			$	225,334			$	48,931			$	50,636			$	55,636
Federal funds sold			30,341				—				81,669				54,098				47,013
Total cash and cash equivalents			98,041				225,334				130,600				104,734				102,649
Investment securities available for sale, at fair value			60,579				63,209				62,631				162,319				143,240
Investment securities held to maturity, at amortized cost, net of allowance for credit losses of $0 for all periods			17,590				17,616				17,642				17,670				17,698
Restricted equity securities, at amortized cost			20,304				22,436				24,325				16,436				16,485
Loans, net of allowance for credit losses of $16,047, $15,435, $14,114, $12,994, and $12,982, respectively			1,637,484				1,617,275				1,579,950				1,448,071				1,416,875
Premises and equipment, net			14,427				14,521				14,709				14,523				14,756
Accrued interest and other receivables			10,256				9,744				9,581				8,273				7,313
Computer software, net of amortization			12,266				10,559				9,149				7,258				4,956
Bank owned life insurance			37,763				37,503				37,249				36,996				36,742
Other assets			40,641				36,811				39,915				43,835				32,665
Total Assets		$	1,949,351			$	2,055,008			$	1,925,751			$	1,860,115			$	1,793,379
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Non-interest bearing deposits		$	388,992			$	487,875			$	550,690			$	566,016			$	535,591
Interest bearing demand deposits			71,308				100,522				80,099				93,695				99,223
Savings and NOW deposits			51,294				53,499				51,419				54,240				58,156
Money market deposits			380,500				260,316				222,540				254,190				231,207
Time deposits			701,289				730,076				608,141				585,783				575,950
Total deposits			1,593,383				1,632,288				1,512,889				1,553,924				1,500,127
Federal funds borrowed			30,000				60,696				—				—				—
Federal Home Loan Bank advances			—				45,000				100,000				—				—
Subordinated debt			72,444				72,344				72,245				72,146				72,047
Other liabilities			43,016				39,692				42,335				44,045				32,801
Total Liabilities			1,738,843				1,850,020				1,727,469				1,670,115				1,604,975
Stockholders’ Equity:
Preferred stock			27,263				27,263				27,263				27,263				27,263
Common stock			29,177				29,185				28,736				28,728				29,178
Capital surplus			64,768				64,213				63,999				63,231				64,822
Retained earnings			97,646				91,991				86,830				80,534				73,702
Accumulated other comprehensive loss			(8,346)				(7,664)				(8,546)				(9,756)				(6,561)
Total Stockholders’ Equity			210,508				204,988				198,282				190,000				188,404
Total Liabilities and Stockholders’ Equity		$	1,949,351			$	2,055,008			$	1,925,751			$	1,860,115			$	1,793,379

 

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION
(In thousands, except share and per share data)
		Year-to-Date								Three Months Ended
		June 30, 2023				June 30, 2022				June 30, 2023				March 31, 2023				December 31, 2022				September 30, 2022				June 30, 2022
INTEREST INCOME:
Interest and fees on loans		$	55,586			$	34,639			$	28,855			$	26,731			$	23,972			$	20,261			$	17,954
Interest on investment securities
Taxable securities			926				758				407				518				467				378				401
Tax-exempt securities			529				535				265				264				262				261				263
Interest on federal funds sold			2,311				229				1,179				1,132				1,071				1,013				195
Total interest income			59,352				36,161				30,706				28,645				25,772				21,913				18,813
INTEREST EXPENSE:
Interest on interest bearing demand deposits			594				170				251				343				256				175				105
Interest on savings and NOW deposits			255				79				147				108				81				43				42
Interest on money market deposits			4,129				270				2,926				1,203				781				496				151
Interest on time deposits			11,221				2,961				7,077				4,144				2,966				2,275				1,530
Interest on federal funds borrowed			239				—				201				38				—				—				—
Interest on Federal Home Loan Bank advances			919				83				13				906				264				—				52
Interest on subordinated debt			1,632				1,280				820				812				828				828				812
Total interest expense			18,989				4,843				11,435				7,554				5,176				3,817				2,692
Net interest income			40,363				31,318				19,271				21,091				20,596				18,096				16,121
Provision for credit losses			921				1,280				638				283				1,118				–				480
Net interest income after provision for credit losses			39,442				30,038				18,633				20,808				19,478				18,096				15,641
NON-INTEREST INCOME:
Deposit account service charges			1,125				1,209				535				590				610				601				597
Bank owned life insurance income			514				500				259				255				253				254				250
Loan swap fee income			—				101				—				—				—				518				101
Net gain on held-to-maturity securities			—				4				—				—				—				—				4
Net gain (loss) on sale of loans			—				43				—				—				—				(211)				—
Other non-interest income			174				568				16				158				196				186				312
Total other income			1,813				2,425				810				1,003				1,059				1,348				1,264
NON-INTEREST EXPENSES:
Salaries and employee benefits			14,216				11,152				6,595				7,621				6,775				5,874				5,604
Furniture and equipment expenses			1,270				1,316				772				498				710				760				659
Advertising and marketing			1,495				980				698				797				620				704				574
Occupancy expenses			912				693				426				486				378				400				352
Outside services			994				935				504				490				529				611				567
Administrative expenses			426				405				211				215				214				253				195
Other operating expenses			3,242				2,976				1,646				1,596				1,481				1,291				1,543
Total non-interest expenses			22,555				18,457				10,852				11,703				10,707				9,893				9,494
Income before income tax expense			18,700				14,006				8,591				10,108				9,830				9,551				7,411
Income tax expense			3,602				2,654				1,645				1,957				2,252				1,808				1,481
Net income			15,098				11,352				6,946				8,151				7,578				7,743				5,930
Preferred stock dividends			1,078				1,078				539				539				539				539				539
Net income available to common shareholders		$	14,020			$	10,274			$	6,407			$	7,612			$	7,039			$	7,204			$	5,391
Net income per common share, basic and diluted		$	1.86			$	1.35			$	0.85			$	1.01			$	0.95			$	0.97			$	0.71
Weighted average number of common shares, basic and diluted			7,519,949				7,611,303				7,522,764				7,517,213				7,433,607				7,463,719				7,575,484

 

UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL
(In thousands)
		June 30, 2023								March 31, 2023								June 30, 2022								Percentage Change
		$ Amount				% of Total				$ Amount				% of Total				$ Amount				% of Total				Last 3 Mos				Last 12 Mos
LOANS:
Construction and land development loans		$	421,277				25.4	%		$	415,078				25.3	%		$	358,062				25.0	%			1.5	%			17.7	%
Residential real estate loans			410,550				24.7	%			391,648				23.9	%			366,758				25.6	%			4.8	%			11.9	%
Commercial real estate loans			727,772				43.9	%			737,019				45.0	%			599,683				41.8	%			-1.3	%			21.4	%
Commercial and industrial loans			93,604				5.6	%			86,937				5.3	%			92,672				6.5	%			7.7	%			1.0	%
Consumer loans			5,750				0.4	%			7,534				0.5	%			17,223				1.1	%			-23.7	%			-66.6	%
Total Gross Loans		$	1,658,953				100.0	%		$	1,638,216				100.0	%		$	1,434,398				100.0	%			1.3	%			15.7	%
Less: Allowance for credit losses			(16,047)								(15,435)								(12,982)
Net deferred loan fees			(5,422)								(5,506)								(4,541)
Net Loans		$	1,637,484							$	1,617,275							$	1,416,875
DEPOSITS:
Non-interest bearing deposits		$	388,992				24.4	%		$	487,875				29.9	%		$	535,591				35.7	%			-20.3	%			-27.4	%
Interest-bearing deposits:
Demand deposits			71,308				4.5	%			100,522				6.2	%			99,223				6.6	%			-29.1	%			-28.1	%
Savings and NOW deposits			51,294				3.2	%			53,499				3.3	%			58,156				3.9	%			-4.1	%			-11.8	%
Money market accounts			380,500				23.9	%			260,316				15.9	%			231,207				15.4	%			46.2	%			64.6	%
Certificates of deposit $250,000 or more			406,583				25.5	%			458,683				28.1	%			383,340				25.6	%			-11.4	%			6.1	%
Certificates of deposit less than $250,000			294,706				18.5	%			271,393				16.6	%			192,610				12.8	%			8.6	%			53.0	%
Total Deposits		$	1,593,383				100.0	%		$	1,632,288				100.0	%		$	1,500,127				100.0	%			-2.4	%			6.2	%
BORROWINGS:
Federal funds borrowed			30,000				29.3	%			60,696				34.1	%			—				0.0	%			-50.6	%			0.0	%
Federal Home Loan Bank advances			—				0.0	%			45,000				25.3	%			—				0.0	%			-100.0	%			0.0	%
Subordinated debt			72,444				70.7	%			72,344				40.6	%			72,047				100.0	%			0.1	%			0.6	%
Total Borrowings		$	102,444				100.0	%		$	178,040				100.0	%		$	72,047				100.0	%			-42.5	%			42.2	%
Total Deposits and Borrowings		$	1,695,827							$	1,810,328							$	1,572,174								-6.3	%			7.9	%
Core customer funding sources (1)		$	1,184,958				69.9	%		$	1,156,279				63.9	%		$	1,094,493				69.6	%			2.5	%			8.3	%
Brokered and listing service sources (2)			408,425				24.1	%			476,009				26.3	%			405,634				25.8	%			-14.2	%			0.7	%
Federal funds borrowed			30,000				1.7	%			60,696				3.3	%			—				0.0	%			-50.6	%			0.0	%
Federal Home Loan Bank advances			—				0.0	%			45,000				2.5	%			—				0.0	%			-100.0	%			0.0	%
Subordinated debt (3)			72,444				4.3	%			72,344				4.0	%			72,047				4.6	%			0.1	%			0.6	%
Total Funding Sources		$	1,695,827				100.0	%		$	1,810,328				100.0	%		$	1,572,174				100.0	%			-6.3	%			7.9	%

(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, 2023												For the three months ended June 30, 2022
		Average Balance				Interest Income/ Expense (3)(4)				Average Yields/ Rate (annualized) (3)(4)				Average Balance				Interest Income/ Expense (3)(4)				Average Yields/ Rate (annualized) (3)(4)
ASSETS:
Interest earning assets:
Loans (1)(2)		$	1,649,300			$	28,855				7.02	%		$	1,434,877			$	17,954				5.02	%
Securities:
Taxable			68,381				407				2.39	%			73,153				401				2.20	%
Tax-exempt			37,876				335				3.55	%			38,507				333				3.47	%
Federal funds and interest-bearing deposits			87,608				1,179				5.40	%			98,326				195				0.80	%
Total interest earning assets		$	1,843,165			$	30,776				6.70	%		$	1,644,863			$	18,883				4.60	%
Other assets			69,488												65,225
Total assets		$	1,912,653											$	1,710,088
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits		$	73,800			$	251				1.36	%		$	96,352			$	105				0.44	%
Savings and NOW deposits			50,644				147				1.16	%			62,588				42				0.27	%
Money market deposit accounts			344,118				2,926				3.41	%			234,097				151				0.26	%
Time deposits			723,056				7,077				3.93	%			499,734				1,530				1.23	%
Total interest-bearing deposits		$	1,191,618			$	10,401				3.50	%		$	892,771			$	1,828				0.82	%
Federal funds purchased			15,174				201				5.31	%			1				—				—
FHLB borrowings			989				13				5.27	%			35,275				52				0.59	%
Subordinated debt			72,405				820				4.54	%			72,009				812				4.52	%
Total interest-bearing liabilities		$	1,280,186			$	11,435				3.58	%		$	1,000,056			$	2,692				1.08	%
Demand deposits and other liabilities			424,505												521,130
Total liabilities		$	1,704,691											$	1,521,186
Stockholders’ Equity			207,962												188,902
Total Liabilities and Stockholders’ Equity		$	1,912,653											$	1,710,088
Interest Rate Spread											3.12	%											3.52	%
Net Interest Income						$	19,341											$	16,191
Net Interest Margin											4.21	%											3.95	%

(1)	Includes loans classified as non-accrual
(2)	Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs
(3)	Income and yields for all periods presented are reported on a tax-equivalent basis using the federal statutory rate of 21%
(4)	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, 2023												For the six months ended June 30, 2022
		Average Balance				Interest Income/ Expense (3)(4)				Average Yields/ Rate (annualized) (3)(4)				Average Balance				Interest Income/ Expense (3)(4)				Average Yields/ Rate (annualized) (3)(4)
ASSETS:
Interest earning assets:
Loans (1)(2)		$	1,624,664			$	55,586				6.90	%		$	1,406,457			$	34,639				4.97	%
Securities:
Taxable			70,147				926				2.66	%			73,283				758				2.09	%
Tax-exempt			37,908				670				3.56	%			39,023				677				3.50	%
Federal funds and interest-bearing deposits			103,053				2,311				4.52	%			91,081				229				0.51	%
Total interest earning assets		$	1,835,772			$	59,493				6.54	%		$	1,609,844			$	36,303				4.55	%
Other assets			63,465												76,387
Total assets		$	1,899,237											$	1,686,231
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits		$	78,568			$	594				1.52	%		$	83,450			$	170				0.41	%
Savings and NOW deposits			51,290				255				1.00	%			72,617				79				0.22	%
Money market deposit accounts			284,906				4,129				2.92	%			250,908				270				0.22	%
Time deposits			698,384				11,221				3.24	%			478,376				2,961				1.25	%
Total interest-bearing deposits		$	1,113,148			$	16,199				2.93	%		$	885,351			$	3,480				0.79	%
Federal funds purchased			9,103				239				5.29	%			1				—				—
FHLB borrowings			39,199				919				4.73	%			36,215				83				0.46	%
Subordinated debt			72,355				1,632				4.55	%			58,079				1,280				4.44	%
Total interest-bearing liabilities		$	1,233,805			$	18,989				3.10	%		$	979,646			$	4,843				1.00	%
Demand deposits and other liabilities			460,632												517,281
Total liabilities		$	1,694,437											$	1,496,927
Stockholders’ Equity			204,800												189,304
Total Liabilities and Stockholders’ Equity		$	1,899,237											$	1,686,231
Interest Rate Spread											3.44	%											3.55	%
Net Interest Income						$	40,504											$	31,460
Net Interest Margin											4.45	%											3.94	%

(1)	Includes loans classified as non-accrual
(2)	Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs
(3)	Income and yields for all periods presented are reported on a tax-equivalent basis using the federal statutory rate of 21%
(4)	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,
		2023				2022				2023				2022
Per share Data and Shares Outstanding
Earnings per common share (basic and diluted)		$	0.85			$	0.71			$	1.86			$	1.35
Book value per common share		$	24.36			$	21.41			$	24.36			$	21.41
Tangible book value per common share (2)		$	22.73			$	20.75			$	22.73			$	20.75
Weighted average common shares (basic and diluted)			7,522,764				7,575,484				7,519,949				7,611,303
Common shares outstanding at end of period			7,522,297				7,526,463				7,522,297				7,526,463
Performance Ratios
Return on average assets (annualized)			1.46	%			1.39	%			1.60	%			1.36	%
Return on average equity (annualized)			13.40	%			12.59	%			14.87	%			12.09	%
Return on average common equity (annualized)			14.22	%			13.38	%			15.92	%			12.79	%
Yield on earning assets (FTE) (2) (annualized)			6.70	%			4.60	%			6.54	%			4.55	%
Cost of interest-bearing liabilities (annualized)			3.58	%			1.08	%			3.10	%			1.00	%
Net interest spread (FTE) (2)			3.12	%			3.52	%			3.44	%			3.55	%
Net interest margin (FTE) (2) (annualized)			4.21	%			3.95	%			4.45	%			3.94	%
Noninterest income as a percentage of average assets (annualized)			0.17	%			0.30	%			0.19	%			0.29	%
Noninterest expense to average assets (annualized)			2.28	%			2.23	%			2.39	%			2.21	%
Efficiency ratio (3)			54.04	%			54.61	%			53.48	%			54.70	%
Asset Quality
Allowance for credit losses (ACL)
Beginning balance, ACL – loans		$	15,435			$	12,500			$	14,114			$	11,697
Add: recoveries			1				2				12				5
Less: charge-offs			(6)				—				(6)				—
Add: provision for credit losses			617				480				1,032				1280
Add: current expected credit losses, nonrecurring adoption			—				—				895				—
Ending balance, ACL – loans		$	16,047			$	12,982			$	16,047			$	12,982
Beginning balance, reserve for unfunded commitment (RUC)		$	1,178			$	—			$	—			$	—
Add: current expected credit losses, nonrecurring adoption			—				—				1,310				—
Add: provision for unfunded commitments			21				—				21				—
Less: recovery of unfunded commitments			—				—				-132				—
Ending balance, RUC		$	1,199			$	—			$	1,199			$	—
Total allowance for credit losses		$	17,246			$	12,982			$	17,246			$	12,982
Allowance for credit losses on loans to total gross loans			0.97	%			0.91	%			0.97	%			0.91	%
Allowance for credit losses to total gross loans			1.04	%			0.91	%			1.04	%			0.91	%
Allowance for credit losses on loans to non-performing assets			N/A				N/A				N/A				N/A
Net charge-offs (recoveries) to average gross loans (annualized)			0.00	%			0.00	%			0.00	%			0.00	%
Concentration Ratios
Commercial real estate loans to total capital (4)			363.43	%			366.10	%			363.43	%			366.10	%
Construction loans to total capital (5)			139.59	%			138.16	%			139.59	%			138.16	%
Non-performing Assets
Loans 30-89 days past due to total gross loans			0.00	%			0.01	%			0.00	%			0.01	%
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		$	—			$	—			$	—			$	—
Non-performing assets		$	—			$	—			$	—			$	—
Non-performing assets to total assets			0.00	%			0.00	%			0.00	%			0.00	%
Regulatory Capital Ratios (Bank only) (1)
Total risk-based capital ratio			16.79	%			16.23	%			16.79	%			16.23	%
Tier 1 risk-based capital ratio			15.83	%			15.42	%			15.83	%			15.42	%
Leverage ratio			14.81	%			14.34	%			14.81	%			14.34	%
Common equity tier 1 ratio			15.83	%			15.42	%			15.83	%			15.42	%
Other information
Closing stock price		$	22.66			$	22.77			$	22.66			$	22.77
Tangible equity / tangible assets (2)			10.24	%			10.26	%			10.24	%			10.26	%
Average tangible equity / average tangible assets (2)			10.34	%			10.81	%			10.28	%			11.03	%
Number of full-time equivalent employees			179				146				179				146
Number of full-service branch offices			6				6				6				6

(1)	Regulatory capital ratios as of June 30, 2023 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,
		2023				2022				2023				2022
Net interest margin (FTE)
Net interest income (GAAP)		$	19,271			$	16,121			$	40,363			$	31,318
FTE adjustment on tax-exempt securities			70				70				141				142
Net interest income (FTE) (non-GAAP)			19,341				16,191				40,504				31,460
Average interest earning assets			1,843,165				1,644,863				1,835,772				1,609,844
Net interest margin (GAAP)			4.19	%			3.93	%			4.43	%			3.92	%
Net interest margin (FTE) (non-GAAP)			4.21	%			3.95	%			4.45	%			3.94	%
		As of June 30,								As of June 30,
		2023				2022				2023				2022
Stockholders equity, adjusted
Total stockholders equity (GAAP)		$	210,508			$	188,404			$	210,508			$	188,404
Less: intangible assets			12,266				4,956				12,266				4,956
Tangible stockholders equity (non-GAAP)			198,242				183,448			$	198,242			$	183,448
Less: preferred stock			27,263				27,263				27,263				27,263
Tangible common stockholders equity (non-GAAP)			170,979				156,185				170,979				156,185
Shares outstanding			7,522,297				7,526,463				7,522,297				7,526,463
Tangible book value per common share (non-GAAP)		$	22.73			$	20.75			$	22.73			$	20.75
		As of June 30,								As of June 30,
		2023				2022				2023				2022
Total assets, adjusted
Total assets (GAAP)		$	1,949,351			$	1,793,379			$	1,949,351			$	1,793,379
Less: intangible assets			(12,266)				(4,956)				(12,266)				(4,956)
Total tangible assets (non-GAAP)			1,937,085				1,788,423				1,937,085				1,788,423
		For the three months ended June 30,								For the six months ended June 30,
		2023				2022				2023				2022
Average stockholders equity, adjusted
Total average stockholders equity (GAAP)		$	207,962			$	188,902			$	204,800			$	189,304
Less: average intangible assets			(11,284)				(4,512)				(10,585)				(3,746)
Total average tangible stockholders equity (non-GAAP)			196,678				184,390				194,215				185,558
		For the three months ended June 30,								For the six months ended June 30,
		2023				2022				2023				2022
Average assets, adjusted
Total average average assets (GAAP)		$	1,912,653			$	1,710,088			$	1,899,237			$	1,686,231
Less: average intangible assets			(11,284)				(4,512)				(10,585)				(3,746)
Total average tangible assets (non-GAAP)			1,901,369				1,705,576				1,888,652				1,682,485

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SOURCE MainStreet Bancshares, Inc.