FAIRFAX, Va., April 23, 2019 /PRNewswire/ -- Mainstreet Bancshares, Inc. (NASDAQ: MNSB) (the "Company") reported a record net income of $3.2 million for the first quarter of 2019; an increase of 93% over the first quarter of 2018.
Earnings per share for both common and diluted shares was $0.39 for the first quarter of 2019, compared to $0.29 for both common and diluted shares for the first quarter of 2018. The Company produced a 1.17% return on average assets and 10.53% on average equity for the first quarter of 2019, compared to 0.84% and 9.66% consecutively for the first quarter of 2018.
Net interest income, the Company's primary source of revenue, was $9.3 million for the first quarter of 2019, up 38% from the first quarter of 2018. The respective net interest margins were 3.50% and 3.53%.
A loan loss provision of $325,000 along with net recoveries of $33,000 were necessary to balance first quarter 2019 loan growth. The Company incurred net charge-offs of $7,000 for the first quarter of 2018.
Fee income of $926,000 in the first quarter of 2019 was up 139% from the first quarter of 2018, due primarily to an increase in deposit account fees and interest rate swap fees related to loan transactions. These sources are expected to continue in a consistent manner going forward.
Total assets were $1.1 billion at March 31, 2019, as compared to $843.7 million at March 31, 2018, an increase of 36%. Net loans at March 31, 2019 total $943.7 million against net loans outstanding at March 31, 2108 of $702.7 million, an increase of 34%. Asset quality remains solid with non-performing assets to total assets at 0.17% as of March 31, 2019, down from 0.23% as of March 31, 2018. Capital levels for the Company remain strong.
Non-interest-bearing deposits increased to $193.7 million as of March 31, 2019, an 18% increase from March 31, 2018. Non-interest-bearing deposits represent 20% of total deposits at March 31, 2019. Total deposits as of March 31, 2019 were $966.8 million an increase of $275.9 million from March 31, 2018.
As of March 31, 2019, the Company's tangible book value per share was $15.15, up 18.8% from $12.75 as of March 31, 2018. According to OTCQX, there were 584 trades during the quarter for a total of 239,705 shares traded or $4,559,489. The closing share price was $21.60, or 143% of book value. The market cap was $178.2 million as of March 31, 2019.
QUOTES: "We continue to expand our Business Banking team with a focus on increasing local depositors," says Chris Brockett, President of MainStreet Bancshares, Inc. and MainStreet Bank. "Our Business Bankers are world class at representing the Bank and have been very effective in their pursuit of business and professional relationships."
"The local economy is vibrant, and the quality of our loan portfolio remains good," says Jeff W. Dick, Chairman and CEO of MainStreet Bancshares, Inc. and MainStreet Bank. "We are moderating our year-on-year asset growth for 2019 and focusing on building our core deposit base, with a goal of improving our net interest margin."
ABOUT MAINSTREET BANK: MainStreet operates six branches in Herndon, Fairfax, Fairfax City, McLean, Leesburg and Clarendon. A seventh branch in Washington, DC will be added during 2019.
MainStreet 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 well over 1,000 businesses in the metropolitan area.
MainStreet has a full complement of payment system services for third party payment providers. MainStreet has a nationally known market leader and a highly experienced team ready to help payment providers create a solution perfect for their needs.
MainStreet 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 mobile banking and Apple Pay to instant-issue Debit Cards, MainStreet Bank is always looking for ways to improve its customer 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, 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 |
(703) 481-4567 |
UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION |
|||||
(Unaudited) |
|||||
(In thousands, except share data) |
|||||
3/31/19 |
12/31/18 |
9/30/18 |
6/30/18 |
3/31/18 |
|
ASSETS |
|||||
Cash and cash equivalents |
|||||
Cash and due from banks |
$ 29,741 |
$ 27,886 |
$ 38,634 |
$ 27,163 |
$ 21,597 |
Federal funds sold |
30,034 |
30,190 |
21,739 |
4,104 |
5,316 |
Total cash and cash equivalents |
59,775 |
58,076 |
60,373 |
31,267 |
26,913 |
Investment securities available for sale, at fair value |
69,308 |
55,979 |
79,489 |
20,806 |
47,009 |
Investment securities held to maturity, at carrying value |
25,487 |
26,178 |
26,221 |
27,422 |
27,469 |
Restricted equity securities, at cost |
5,732 |
5,894 |
4,209 |
4,737 |
5,545 |
Loans, net of allowance for loan losses of $9,189, $8,831 |
|||||
$8,327, $7,731, and $6,334, consecutively |
943,735 |
917,125 |
850,822 |
815,875 |
702,700 |
Premises and equipment, net |
14,226 |
14,222 |
14,414 |
14,660 |
14,568 |
Accrued interest and other receivables |
5,644 |
5,148 |
4,919 |
4,695 |
3,938 |
Bank owned life insurance |
14,169 |
14,064 |
13,957 |
13,851 |
13,743 |
Other assets |
8,005 |
3,927 |
2,577 |
2,842 |
1,794 |
Total Assets |
$ 1,146,081 |
$ 1,100,613 |
$ 1,056,981 |
$ 936,155 |
$ 843,679 |
LIABILITIES AND STOCKHOLDERS' EQUITY |
|||||
Liabilities: |
|||||
Non-interest bearing deposits |
$ 193,744 |
$ 211,749 |
$ 191,986 |
$ 179,827 |
$ 164,795 |
Interest-bearing DDA deposits |
59,639 |
60,588 |
59,295 |
60,389 |
54,097 |
Savings and NOW deposits |
61,537 |
51,371 |
52,602 |
48,659 |
49,935 |
Money market deposits |
147,655 |
138,153 |
109,498 |
118,194 |
118,532 |
Time deposits |
504,252 |
458,276 |
476,511 |
394,433 |
303,575 |
Total deposits |
966,827 |
920,137 |
889,892 |
801,502 |
690,934 |
Federal Home Loan Bank advances and other borrowings |
30,000 |
40,000 |
30,000 |
45,117 |
64,129 |
Subordinated debt |
14,783 |
14,776 |
14,769 |
14,762 |
14,755 |
Other liabilities |
9,488 |
4,449 |
2,785 |
2,617 |
3,298 |
Total Liabilities |
1,021,098 |
979,362 |
937,446 |
863,998 |
773,116 |
Stockholders' Equity: |
|||||
Common stock, par value $4 per share, authorized 10,000,000 s |
32,387 |
32,177 |
32,177 |
22,691 |
21,579 |
Capital surplus |
74,353 |
74,256 |
76,427 |
40,731 |
35,769 |
Retained earnings |
18,395 |
15,185 |
11,371 |
9,020 |
13,368 |
Accumulated other comprehensive loss |
(152) |
(367) |
(440) |
(285) |
(153) |
Total Stockholders' Equity |
124,983 |
121,251 |
119,535 |
72,157 |
70,563 |
Total Liabilities and Stockholders' Equity |
$ 1,146,081 |
$ 1,100,613 |
$ 1,056,981 |
$ 936,155 |
$ 843,679 |
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION |
||||||||||
(Unaudited) |
||||||||||
(In thousands, except share and per share data) |
||||||||||
Year-to-Date |
Three Months Ended |
|||||||||
3/31/19 |
3/31/18 |
3/31/19 |
12/31/18 |
9/30/18 |
6/30/18 |
3/31/18 |
||||
INTEREST INCOME: |
||||||||||
Interest and fees on loans |
$ 12,916 |
$ 8,316 |
$ 12,916 |
$ 12,244 |
$ 11,061 |
$ 9,649 |
$ 8,316 |
|||
Interest on investment securities |
556 |
341 |
556 |
381 |
341 |
407 |
341 |
|||
Interest on federal funds sold |
345 |
100 |
345 |
457 |
423 |
115 |
100 |
|||
Total interest income |
13,817 |
8,757 |
13,817 |
13,082 |
11,825 |
10,171 |
8,757 |
|||
INTEREST EXPENSE: |
||||||||||
Interest on interest bearing DDA deposits |
245 |
164 |
245 |
269 |
245 |
222 |
164 |
|||
Interest on savings and NOW deposits |
73 |
46 |
73 |
77 |
65 |
63 |
46 |
|||
Interest on money market deposits |
763 |
264 |
763 |
598 |
432 |
414 |
264 |
|||
Interest on time deposits |
2,931 |
1,091 |
2,931 |
2,784 |
2,677 |
1,513 |
1,091 |
|||
Interest on Federal Home Loan Bank advances and other borrowings |
219 |
179 |
219 |
188 |
199 |
210 |
179 |
|||
Interest on subordinated debt |
238 |
238 |
238 |
244 |
243 |
241 |
238 |
|||
Total interest expense |
4,469 |
1,982 |
4,469 |
4,160 |
3,861 |
2,663 |
1,982 |
|||
Net interest income |
9,348 |
6,775 |
9,348 |
8,922 |
7,964 |
7,508 |
6,775 |
|||
Provision for loan losses |
325 |
635 |
325 |
496 |
600 |
1,395 |
635 |
|||
Net interest income after provision for loan losses |
9,023 |
6,140 |
9,023 |
8,426 |
7,364 |
6,113 |
6,140 |
|||
OTHER INCOME: |
||||||||||
Deposit account service charges |
370 |
213 |
370 |
311 |
320 |
259 |
213 |
|||
Bank owned life insurance income |
105 |
106 |
105 |
107 |
105 |
109 |
106 |
|||
Loan swap fee income |
290 |
— |
290 |
713 |
— |
— |
— |
|||
Other fee income |
161 |
189 |
161 |
331 |
261 |
215 |
189 |
|||
Total other income |
926 |
508 |
926 |
1,462 |
686 |
583 |
508 |
|||
OTHER EXPENSES: |
||||||||||
Salaries and employee benefits |
3,860 |
2,749 |
3,860 |
3,267 |
3,018 |
2,811 |
2,749 |
|||
Furniture and equipment expenses |
385 |
381 |
385 |
534 |
493 |
451 |
381 |
|||
Advertising and marketing |
105 |
156 |
105 |
146 |
171 |
141 |
156 |
|||
Occupancy expenses |
213 |
151 |
213 |
220 |
206 |
159 |
151 |
|||
Outside services |
227 |
196 |
227 |
164 |
239 |
240 |
196 |
|||
Administrative expenses |
167 |
118 |
167 |
142 |
161 |
155 |
118 |
|||
Other operating expenses |
1,051 |
826 |
1,051 |
900 |
872 |
912 |
826 |
|||
Total other expenses |
6,008 |
4,577 |
6,008 |
5,373 |
5,160 |
4,869 |
4,577 |
|||
INCOME BEFORE INCOME TAXES |
3,941 |
2,071 |
3,941 |
4,515 |
2,890 |
1,827 |
2,071 |
|||
Income tax expense |
694 |
385 |
694 |
846 |
539 |
324 |
385 |
|||
NET INCOME |
$ 3,247 |
$ 1,686 |
$ 3,247 |
$ 3,669 |
$ 2,351 |
$ 1,503 |
$ 1,686 |
|||
Net income per common share, basic and diluted (1) |
$ 0.39 |
$ 0.29 |
$ 0.39 |
$ 0.45 |
$ 0.35 |
$ 0.26 |
$ 0.29 |
|||
Weighted average number of shares, basic and diluted (1) |
8,242,873 |
5,799,496 |
8,242,873 |
8,178,888 |
6,788,868 |
5,810,383 |
5,799,496 |
|||
(1) Amounts for all periods reflect the effect of the 5% stock dividend on April 30, 2018. |
UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL |
||||||||
(Unaudited) |
||||||||
(In thousands) |
||||||||
March 31, 2019 |
December 31, 2018 |
March 31, 2018 |
Percentage Change |
|||||
$ Amount |
% of Total |
$ Amount |
% of Total |
$ Amount |
% of Total |
Last 3 Mos |
Last 12 Mos |
|
LOANS: |
||||||||
Construction and land development |
$ 192,494 |
20.2% |
$ 183,551 |
19.8% |
$ 105,193 |
14.8% |
4.9% |
83.0% |
Residential real estate loans |
151,884 |
15.9% |
149,628 |
16.2% |
118,295 |
16.7% |
1.5% |
28.4% |
Commercial real estate loans |
409,522 |
42.9% |
377,760 |
40.7% |
278,355 |
39.2% |
8.4% |
47.1% |
Commercial industrial loans |
105,391 |
11.0% |
114,221 |
12.3% |
108,770 |
15.4% |
-7.7% |
-3.1% |
Consumer loans |
95,299 |
10.0% |
102,277 |
11.0% |
98,890 |
13.9% |
-6.8% |
-3.6% |
Total Gross Loans |
$ 954,590 |
100.0% |
$ 927,437 |
100.0% |
$ 709,503 |
100.0% |
2.9% |
34.5% |
Less: Allowance for loan losses |
(9,189) |
(8,831) |
(6,334) |
|||||
Net deferred loan fees |
(1,666) |
(1,481) |
(469) |
|||||
Net Loans |
$ 943,735 |
$ 917,125 |
$ 702,700 |
|||||
DEPOSITS: |
||||||||
Non-interest bearing demand deposits |
$ 193,744 |
20.0% |
$ 211,749 |
23.0% |
$ 164,789 |
23.9% |
-8.5% |
17.6% |
Interest-bearing demand deposits: |
||||||||
Demand deposits |
59,639 |
6.2% |
60,588 |
6.6% |
54,105 |
7.8% |
-1.6% |
10.2% |
Savings and NOW deposits |
61,537 |
6.4% |
51,371 |
5.6% |
49,934 |
7.2% |
19.8% |
23.2% |
Money market accounts |
147,655 |
15.3% |
138,152 |
15.0% |
118,531 |
17.2% |
6.9% |
24.6% |
Certificates of deposit |
||||||||
$100,000 or more |
465,605 |
48.1% |
422,436 |
45.9% |
277,799 |
40.2% |
10.2% |
67.6% |
Less than $100,000 |
38,647 |
4.0% |
35,841 |
3.9% |
25,775 |
3.7% |
7.8% |
49.9% |
Total Deposits |
$ 966,827 |
100.0% |
$ 920,137 |
100.0% |
$ 690,933 |
100.0% |
5.1% |
39.9% |
BORROWINGS: |
||||||||
Federal Home Loan Bank advances |
30,000 |
67.0% |
40,000 |
73.0% |
64,129 |
81.3% |
-25.0% |
-53.2% |
Subordinated debt |
14,783 |
33.0% |
14,776 |
27.0% |
14,755 |
18.7% |
0.0% |
0.2% |
Total Borrowings |
$ 44,783 |
100.0% |
$ 54,776 |
100.0% |
$ 78,884 |
100.0% |
18.2% |
-43.2% |
Total Deposits and Borrowings |
$ 1,011,610 |
$ 974,913 |
$ 769,817 |
3.8% |
31.4% |
|||
Core customer funding sources (1) |
$ 566,398 |
56.0% |
$ 586,001 |
60.1% |
$ 536,239 |
69.7% |
-3.3% |
5.6% |
Brokered and listing service sources (2) |
400,429 |
39.6% |
334,136 |
34.3% |
154,694 |
20.1% |
19.8% |
158.9% |
Federal Home Loan Bank Advances |
30,000 |
3.0% |
40,000 |
4.1% |
64,129 |
8.3% |
-25.0% |
-53.2% |
Subordinated debt (3) |
14,783 |
1.4% |
14,776 |
1.5% |
14,755 |
1.9% |
0.0% |
0.2% |
Total Funding Sources |
$1,011,610 |
100.0% |
$ 974,913 |
100.0% |
$ 769,817 |
100.0% |
3.8% |
31.4% |
(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 |
|||||||
(Unaudited) |
|||||||
(In thousands) |
|||||||
Three Months Ended March 31, 2019 |
Three Months Ended March 31, 2018 |
||||||
Average |
Interest |
Average (annualized) |
Average |
Interest |
Average (annualized) |
||
ASSETS: |
|||||||
Interest earning assets: |
|||||||
Loans (1) |
$ 936,401 |
$ 12,916 |
5.52% |
$ 681,232 |
$ 8,316 |
4.88% |
|
Investment securities |
68,550 |
556 |
3.24% |
56,111 |
341 |
2.43% |
|
Federal funds and interest - |
|||||||
bearing deposits |
64,944 |
345 |
2.12% |
30,117 |
100 |
1.33% |
|
Total interest earning assets |
$ 1,069,895 |
$ 13,817 |
5.17% |
$ 767,460 |
$ 8,757 |
4.56% |
|
Other assets |
36,788 |
31,711 |
|||||
Total assets |
$ 1,106,683 |
$ 799,171 |
|||||
Liabilities and Stockholders' Equity: |
|||||||
Interest-bearing liabilities: |
|||||||
Interest-bearing demand deposits |
$ 56,701 |
$ 245 |
1.73% |
$ 51,240 |
$ 164 |
1.28% |
|
Money market deposit accounts |
143,825 |
763 |
2.12% |
96,256 |
264 |
1.10% |
|
Savings and NOW deposits |
58,616 |
73 |
0.50% |
47,807 |
46 |
0.38% |
|
Time deposits |
468,009 |
2,931 |
2.51% |
307,343 |
1,091 |
1.42% |
|
Total interest-bearing deposits |
$ 727,151 |
$ 4,012 |
2.21% |
$ 502,646 |
$ 1,565 |
1.24% |
|
Federal funds and repos purchased |
139 |
1 |
2.88% |
920 |
7 |
3.04% |
|
Subordinated debt |
14,780 |
238 |
6.44% |
14,752 |
238 |
6.45% |
|
FHLB borrowings |
34,111 |
218 |
2.56% |
44,026 |
172 |
1.56% |
|
Total interest-bearing liabilities |
$ 776,181 |
$ 4,469 |
2.30% |
$ 562,344 |
$ 1,982 |
1.41% |
|
Demand deposits and other liabilities |
207,180 |
166,988 |
|||||
Total liabilities |
$ 983,361 |
$ 729,332 |
|||||
Stockholders' Equity |
123,322 |
69,839 |
|||||
Total Liabilities and Stockholders' Equity |
$ 1,106,683 |
$ 799,171 |
|||||
Interest Rate Spread |
2.87% |
3.15% |
|||||
Net Interest Income and Margin |
$ 9,348 |
3.50% |
$ 6,775 |
3.53% |
|||
(1) Includes loans classified as non-accrual. |
UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES |
||||
(Unaudited) |
||||
(Dollars in thousands except per share data) |
||||
At or For Three Months Ended |
||||
March 31, |
||||
2019 |
2018 |
|||
Per share Data and Shares Outstanding (1) |
||||
Earnings per share – (basic and diluted) |
$ 0.39 |
$ 0.29 |
||
Tangible book value per share |
$ 15.15 |
$ 12.75 |
||
Weighted average common shares (basic and diluted) |
8,242,873 |
5,799,496 |
||
Common shares outstanding at end of period |
8,249,759 |
5,533,605 |
||
Performance Ratios |
||||
Return on average assets (annualized) |
1.17% |
0.84% |
||
Return on average equity (annualized) |
10.53% |
9.66% |
||
Yield on earning assets (annualized) |
5.17% |
4.56% |
||
Cost of interest bearing liabilities (annualized) |
2.30% |
1.41% |
||
Net interest spread |
2.87% |
3.15% |
||
Net interest margin (annualized) |
3.50% |
3.53% |
||
Noninterest income as a percentage of average assets (annualized) |
0.33% |
0.25% |
||
Noninterest expense to average assets (annualized) |
2.17% |
2.29% |
||
Efficiency ratio |
58.48% |
62.85% |
||
Asset Quality |
||||
Loans 30-89 days past due to total gross loans |
0.01% |
0.01% |
||
Loans 90 days past due to total gross loans |
0.00% |
0.00% |
||
Non-accrual loans to total gross loans |
0.20% |
0.27% |
||
Non-performing assets |
$ 1,973 |
$ 1,939 |
||
Non-performing assets to total assets |
0.17% |
0.23% |
||
Allowance for loan losses to total gross loans |
0.96% |
0.89% |
||
Allowance for loan losses to non-performing loans |
4.66 |
3.27 |
||
Net loan charge-offs (recoveries) |
$ (33) |
$ 7 |
||
Net charge-offs to average loans (annualized) |
0.00% |
0.00% |
||
Troubled debt restructurings (total) |
||||
Performing in accordance with modified terms |
$ 1,502 |
$ 1,534 |
||
Not performing in accordance with modified terms |
$ 1,939 |
$ 1,939 |
||
Regulatory Capital Ratios (Bank only) |
||||
Total risk-based capital ratio |
13.45% |
11.42% |
||
Tier 1 risk-based capital ratio |
12.61% |
10.62% |
||
Leverage ratio |
12.38% |
10.44% |
||
Common equity tier 1 ratio |
12.61% |
10.62% |
||
Other information |
||||
Closing stock price |
$ 21.60 |
$ 20.95 |
||
Tangible equity / tangible assets |
10.91% |
8.36% |
||
Average tangible equity / average tangible assets |
11.14% |
8.74% |
||
Number of full time equivalent employees |
113 |
95 |
||
# Full service branch offices |
6 |
6 |
(1) |
Amounts for all periods presented are adjusted to reflect a 5% stock dividend effective April 30, 2018 |
SOURCE MainStreet Bancshares, Inc.
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