MainStreet Bancshares, Inc., Reports Solid Earnings for 3rd Quarter 2023

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Oct 23, 2023, 08:00 ET

Net Income Totals $6.3 Million for the Quarter Ended September 30

FAIRFAX, Va., Oct. 23, 2023 /PRNewswire/ -- MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the holding company for MainStreet Bank, reported net income of $6.3 million for the quarter ended September 30, 2023, in line with expectations. Earnings per share for the year-to-date stand at $2.64. Cumulative net income for the calendar year reached $21.4 million, a 12.3% increase over the first nine months of 2022.

Annualized returns through the first nine months included:

Return on Average Equity (ROAE):	13.80 %
Return on Average Assets (ROAA):	1.50 %
Net Interest Margin (NIM) (tax equivalent):	4.28 %
Efficiency Ratio:	55.06 %
Liquidity Coverage Ratio:	164 %
Core Deposit Ratio:	68 %
FDIC Insured Deposits / Total Deposits:	76 %
Allowance for Credit Losses (ACL):	1.01 %
Tangible Book Value per Common Share:	$23.00

"The Company continues to put up very strong performance metrics in spite of the rising interest rate environment," said Jeff W. Dick, Chairman and CEO of MainStreet Bancshares Inc. and MainStreet Bank. "The team did an excellent job preparing the balance sheet for a rising rate environment leading up to the first quarter of 2022. Since mid-2023, the team has been equally focused on neutralizing the balance sheet for a stable or slightly declining interest rate environment going forward."

"MainStreet Bank is a community bank built upon great relationships, and this continues to be a true testament to our financial strength. Our balance sheet continues to grow through the many thoughtful referrals from our existing customers and from our reputation in the markets we serve," said Abdul Hersiburane, President of MainStreet Bank.

ABOUT AVENU

Avenu, MainStreet Bank's fully integrated Software as a Service (SaaS) solution, identified its first client on October 18. SafariPay, via its global money transmittance service PaySii, expects its customers to maintain average balances of $4 million on the platform.

Avenu — Banking Delivered. Avenu is the only embedded banking solution that connects our partners and their apps directly and seamlessly to a banking core — MainStreet Bank's banking core. 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.

MainStreet Bancshares, Inc.
UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION
(In thousands)

	September 30, 2023		June 30, 2023		March 31, 2023		December 31, 2022*		September 30, 2022
ASSETS
Cash and cash equivalents
Cash and due from banks	$	44,912	$	67,700	$	225,334	$	48,931	$	50,636
Federal funds sold		76,271		30,341		—		81,669		54,098
Total cash and cash equivalents		121,183		98,041		225,334		130,600		104,734
Investment securities available for sale, at fair value		56,726		60,579		63,209		62,631		162,319
Investment securities held to maturity, at amortized cost, net of allowance for credit losses of $0 for all periods		17,565		17,590		17,616		17,642		17,670
Restricted equity securities, at amortized cost		20,619		20,304		22,436		24,325		16,436
Loans, net of allowance for credit losses of $15,626, $16,047, $15,435, $14,114, and $12,994, respectively		1,681,444		1,637,484		1,617,275		1,579,950		1,448,071
Premises and equipment, net		14,275		14,427		14,521		14,709		14,523
Accrued interest and other receivables		11,184		10,256		9,744		9,581		8,273
Computer software, net of amortization		13,373		12,266		10,559		9,149		7,258
Bank owned life insurance		38,035		37,763		37,503		37,249		36,996
Other assets		47,087		40,641		36,811		39,915		43,835
Total Assets	$	2,021,491	$	1,949,351	$	2,055,008	$	1,925,751	$	1,860,115
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Non-interest bearing deposits	$	394,859	$	388,992	$	487,875	$	550,690	$	566,016
Interest bearing demand deposits		76,423		71,308		100,522		80,099		93,695
Savings and NOW deposits		46,550		51,294		53,499		51,419		54,240
Money market deposits		461,398		380,500		260,316		222,540		254,190
Time deposits		703,960		701,289		730,076		608,141		585,783
Total deposits		1,683,190		1,593,383		1,632,288		1,512,889		1,553,924
Federal funds borrowed		—		30,000		60,696		—		—
Federal Home Loan Bank advances		—		—		45,000		100,000		—
Subordinated debt		72,543		72,444		72,344		72,245		72,146
Other liabilities		52,015		43,016		39,692		42,335		44,045
Total Liabilities		1,807,748		1,738,843		1,850,020		1,727,469		1,670,115
Stockholders' Equity:
Preferred stock		27,263		27,263		27,263		27,263		27,263
Common stock		29,188		29,177		29,185		28,736		28,728
Capital surplus		65,407		64,768		64,213		63,999		63,231
Retained earnings		102,694		97,646		91,991		86,830		80,534
Accumulated other comprehensive loss		(10,809)		(8,346)		(7,664)		(8,546)		(9,756)
Total Stockholders' Equity		213,743		210,508		204,988		198,282		190,000
Total Liabilities and Stockholders' Equity	$	2,021,491	$	1,949,351	$	2,055,008	$	1,925,751	$	1,860,115

*Derived from audited financial statements

MainStreet Bancshares, Inc.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION
(In thousands, except share and per share data)

	Year-to-Date				Three Months Ended
	September 30, 2023		September 30, 2022		September 30, 2023		June 30, 2023		March 31, 2023		December 31, 2022		September 30, 2022
INTEREST INCOME:
Interest and fees on loans	$	85,336	$	54,900	$	29,750	$	28,855	$	26,731	$	23,972	$	20,261
Interest on investment securities
Taxable securities		1,384		1,136		459		407		518		467		378
Tax-exempt securities		797		796		268		265		264		262		261
Interest on federal funds sold		3,528		1,241		1,217		1,179		1,132		1,071		1,013
Total interest income		91,045		58,073		31,694		30,706		28,645		25,772		21,913
INTEREST EXPENSE:
Interest on interest bearing demand deposits		834		345		240		251		343		256		175
Interest on savings and NOW deposits		400		122		145		147		108		81		43
Interest on money market deposits		8,285		766		4,156		2,926		1,203		781		496
Interest on time deposits		18,747		5,236		7,526		7,077		4,144		2,966		2,275
Interest on federal funds borrowed		274		—		35		201		38		—		—
Interest on Federal Home Loan Bank advances		1,105		83		186		13		906		264		—
Interest on subordinated debt		2,460		2,108		828		820		812		828		828
Total interest expense		32,105		8,660		13,116		11,435		7,554		5,176		3,817
Net interest income		58,940		49,413		18,578		19,271		21,091		20,596		18,096
Provision for credit losses		1,176		1,280		255		638		283		1,118		—
Net interest income after provision for credit losses		57,764		48,133		18,323		18,633		20,808		19,478		18,096
NON-INTEREST INCOME:
Deposit account service charges		1,639		1,810		514		535		590		610		601
Bank owned life insurance income		786		755		272		259		255		253		254
Loan swap fee income		—		619		—		—		—		—		518
Net gain on held-to-maturity securities		—		4		—		—		—		—		—
Net loss on sale of loans		—		(168)		—		—		—		—		(211)
Other non-interest income		352		753		177		16		158		196		186
Total other income		2,777		3,773		963		810		1,003		1,059		1,348
NON-INTEREST EXPENSES:
Salaries and employee benefits		21,139		17,025		6,924		6,595		7,621		6,775		5,874
Furniture and equipment expenses		1,983		2,076		713		772		498		710		760
Advertising and marketing		2,072		1,684		577		698		797		620		704
Occupancy expenses		1,287		1,093		375		426		486		378		400
Outside services		1,691		1,545		697		504		490		529		611
Administrative expenses		703		658		277		211		215		214		253
Other operating expenses		5,109		4,268		1,866		1,646		1,596		1,481		1,291
Total non-interest expenses		33,984		28,349		11,429		10,852		11,703		10,707		9,893
Income before income tax expense		26,557		23,557		7,857		8,591		10,108		9,830		9,551
Income tax expense		5,119		4,462		1,516		1,645		1,957		2,252		1,808
Net income		21,438		19,095		6,341		6,946		8,151		7,578		7,743
Preferred stock dividends		1,617		1,617		539		539		539		539		539
Net income available to common shareholders	$	19,821	$	17,478	$	5,802	$	6,407	$	7,612	$	7,039	$	7,204
Net income per common share, basic and diluted	$	2.64	$	2.31	$	0.77	$	0.85	$	1.01	$	0.95	$	0.97
Weighted average number of common shares, basic and diluted		7,521,426		7,561,567		7,524,332		7,522,764		7,517,213		7,433,607		7,463,719

MainStreet Bancshares, Inc.
UNAUDITED LOAN, DEPOSIT
AND BORROWING DETAIL
*(In thousands)*

	September 30, 2023					June 30, 2023					September 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	$	426,698		25.1	%	$	421,277		25.4	%	$	366,689		25.0	%		1.3	%		16.4	%
Residential real estate loans		462,935		27.2	%		410,550		24.7	%		373,056		25.4	%		12.8	%		24.1	%
Commercial real estate loans		734,615		43.1	%		727,772		43.9	%		638,110		43.5	%		0.9	%		15.1	%
Commercial and industrial loans		73,855		4.3	%		93,604		5.6	%		74,482		5.1	%		-21.1	%		-0.8	%
Consumer loans		4,598		0.3	%		5,750		0.4	%		13,628		1.0	%		-20.0	%		-66.3	%
Total Gross Loans	$	1,702,701		100.0	%	$	1,658,953		100.0	%	$	1,465,965		100.0	%		2.6	%		16.1	%
Less: Allowance for credit losses		(15,626)					(16,047)					(12,994)
Net deferred loan fees		(5,631)					(5,422)					(4,900)
Net Loans	$	1,681,444				$	1,637,484				$	1,448,071
DEPOSITS:
Non-interest bearing deposits	$	394,859		23.5	%	$	388,992		24.4	%	$	566,016		36.4	%		1.5	%		-30.2	%
Interest-bearing deposits:
Demand deposits		76,423		4.5	%		71,308		4.5	%		93,695		6.0	%		7.2	%		-18.4	%
Savings and NOW deposits		46,550		2.8	%		51,294		3.2	%		54,240		3.5	%		-9.2	%		-14.2	%
Money market accounts		461,398		27.4	%		380,500		23.9	%		254,190		16.4	%		21.3	%		81.5	%
Certificates of deposit $250,000 or more		432,440		25.7	%		406,583		25.5	%		371,739		23.9	%		6.4	%		16.3	%
Certificates of deposit less than $250,000		271,520		16.1	%		294,706		18.5	%		214,044		13.8	%		-7.9	%		26.9	%
Total Deposits	$	1,683,190		100.0	%	$	1,593,383		100.0	%	$	1,553,924		100.0	%		5.6	%		8.3	%
BORROWINGS:
Federal funds borrowed		—		0.0	%		30,000		29.3	%		—		0.0	%		-100.0	%		0.0	%
Subordinated debt		72,543		100.0	%		72,444		70.7	%		72,146		100.0	%		0.1	%		0.6	%
Total Borrowings	$	72,543		100.0	%	$	102,444		100.0	%	$	72,146		100.0	%		-29.2	%		0.6	%
Total Deposits and Borrowings	$	1,755,733				$	1,695,827				$	1,626,070					3.5	%		8.0	%

Core customer funding sources ⁽¹⁾	$	1,144,513		65.2	%	$	1,111,523		65.5	%	$	1,156,862		71.1	%		3.0	%		-1.1	%
Brokered and listing service sources ⁽²⁾		538,677		30.7	%		481,860		28.4	%		397,062		24.5	%		11.8	%		35.7	%
Federal funds borrowed		—		0.0	%		30,000		1.8	%		—		0.0	%		-100.0	%		#DIV/0!
Subordinated debt ⁽³⁾		72,543		4.1	%		72,444		4.3	%		72,146		4.4	%		0.1	%		0.6	%
Total Funding Sources	$	1,755,733		100.0	%	$	1,695,827		100.0	%	$	1,626,070		100.0	%		3.5	%		8.0	%


(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

MainStreet Bancshares, Inc.
UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES
(In thousands)

	For the three months ended September 30, 2023							For the three months ended September 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⁾	$	1,665,474	$	29,750		7.09	%	$	1,446,679	$	20,261		5.56	%
Securities:
Taxable		67,513		459		2.70	%		73,914		378		2.03	%
Tax-exempt		37,812		339		3.56	%		38,074		330		3.44	%
Federal funds and interest-bearing deposits		94,808		1,217		5.09	%		182,331		1,013		2.20	%
Total interest-earning assets	$	1,865,607	$	31,765		6.76	%	$	1,740,998	$	21,982		5.01	%
Other assets		63,883							61,479
Total assets	$	1,929,490						$	1,802,477
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits	$	77,047	$	240		1.24	%	$	93,569	$	175		0.74	%
Savings and NOW deposits		48,594		145		1.18	%		55,100		43		0.31	%
Money market deposit accounts		413,710		4,156		3.99	%		257,091		496		0.77	%
Time deposits		700,405		7,526		4.26	%		575,832		2,275		1.57	%
Total interest-bearing deposits	$	1,239,756	$	12,067		3.86	%	$	981,592	$	2,989		1.21	%
Federal funds borrowed		2,501		35		5.55	%		2		—		—
FHLB advances		13,478		186		5.48	%		—		—		—
Subordinated debt		72,504		828		4.53	%		72,107		828		4.56	%
Total interest-bearing liabilities	$	1,328,239	$	13,116		3.92	%	$	1,053,701	$	3,817		1.44	%
Demand deposits and other liabilities		388,004							558,337
Total liabilities	$	1,716,243						$	1,612,038
Stockholders' Equity		213,247							190,439
Total Liabilities and Stockholders' Equity	$	1,929,490						$	1,802,477
Interest Rate Spread						2.84	%						3.57	%
Net Interest Income			$	18,649						$	18,165
Net Interest Margin						3.97	%						4.14	%


(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

MainStreet Bancshares, Inc.
UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES
(In thousands)

	For the nine months ended September 30, 2023							For the nine months ended September 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⁾	$	1,640,460	$	85,336		6.95	%	$	1,420,013	$	54,900		5.17	%
Securities:
Taxable		69,260		1,384		2.67	%		73,496		1,136		2.07	%
Tax-exempt		37,876		1,009		3.56	%		38,703		1,008		3.48	%
Federal funds and interest-bearing deposits		99,004		3,528		4.76	%		121,832		1,241		1.36	%
Total interest-earning assets	$	1,846,600	$	91,257		6.61	%	$	1,654,044	$	58,285		4.71	%
Other assets		62,832							71,361
Total assets	$	1,909,432						$	1,725,405
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits	$	78,018	$	834		1.43	%	$	86,836	$	345		0.53	%
Savings and NOW deposits		50,382		400		1.06	%		66,714		122		0.24	%
Money market deposit accounts		328,037		8,285		3.38	%		252,992		766		0.40	%
Time deposits		699,377		18,747		3.58	%		511,242		5,236		1.37	%
Total interest-bearing deposits	$	1,155,814	$	28,266		3.27	%	$	917,784	$	6,469		0.94	%
Federal funds borrowed		6,878		274		5.33	%		2		—		—
FHLB advances		30,531		1,105		4.84	%		24,011		83		0.46	%
Subordinated debt		72,405		2,460		4.54	%		62,807		2,108		4.49	%
Total interest-bearing liabilities	$	1,265,628	$	32,105		3.39	%	$	1,004,604	$	8,660		1.15	%
Demand deposits and other liabilities		436,157							531,115
Total liabilities	$	1,701,785						$	1,535,719
Stockholders' Equity		207,647							189,686
Total Liabilities and Stockholders' Equity	$	1,909,432						$	1,725,405
Interest Rate Spread						3.22	%						3.56	%
Net Interest Income			$	59,152						$	49,625
Net Interest Margin						4.28	%						4.01	%

(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

MainStreet Bancshares, Inc.
UNAUDITED SUMMARY FINANCIAL DATA
(Dollars in thousands except per share data)

	At or For the Three Months Ended						At or For the Nine Months Ended
	September 30,						September 30,
	2023			2022			2023			2022
*Per share Data and Shares Outstanding*
Earnings per common share (basic and diluted)	$	0.77		$	0.97		$	2.64		$	2.31
Book value per common share	$	24.78		$	21.92		$	24.78		$	21.92
Tangible book value per common share(2)	$	23.00		$	20.94		$	23.00		$	20.94
Weighted average common shares (basic and diluted)		7,524,332			7,463,719			7,521,426			7,561,567
Common shares outstanding at end of period		7,524,887			7,425,432			7,524,887			7,425,432
*Performance Ratios*
Return on average assets (annualized)		1.30	%		1.70	%		1.50	%		1.48	%
Return on average equity (annualized)		11.80	%		16.13	%		13.80	%		13.46	%
Return on average common equity (annualized)		12.38	%		17.52	%		14.69	%		14.39	%
Yield on earning assets (FTE) (2) (annualized)		6.76	%		5.01	%		6.61	%		4.71	%
Cost of interest bearing liabilities (annualized)		3.92	%		1.44	%		3.39	%		1.15	%
Net interest spread (FTE)(2)		2.84	%		3.57	%		3.22	%		3.56	%
Net interest margin (FTE)(2) (annualized)		3.97	%		4.14	%		4.28	%		4.01	%
Noninterest income as a percentage of average assets (annualized)		0.20	%		0.30	%		0.19	%		0.29	%
Noninterest expense to average assets (annualized)		2.35	%		2.18	%		2.38	%		2.20	%
Efficiency ratio(3)		58.49	%		50.88	%		55.06	%		53.30	%
*Asset Quality*
Allowance for credit losses (ACL)
Beginning balance, ACL - loans	$	16,047		$	12,982		$	14,114		$	11,697
Add: recoveries		1			12			14			17
Less: charge-offs		(324)			—			(331)			—
Add: provision for (recovery of) credit losses		(98)			—			934			1,280
Add: current expected credit losses, nonrecurring adoption		—			—			895			—
Ending balance, ACL - loans	$	15,626		$	12,994		$	15,626		$	12,994

Beginning balance, reserve for unfunded commitment (RUC)	$	1,199		$	—		$	—		$	—
Add: current expected credit losses, nonrecurring adoption		—			—			1,310			—
Add: provision for unfunded commitments		353			—			374			—
Less: recovery of unfunded commitments		—			—			(132)			—
Ending balance, RUC	$	1,552		$	—		$	1,552		$	—
Total allowance for credit losses	$	17,178		$	12,994		$	17,178		$	12,994

Allowance for credit losses on loans to total gross loans		0.92	%		0.89	%		0.92	%		0.89	%
Allowance for credit losses to total gross loans		1.01	%		0.89	%		1.01	%		0.89	%
Allowance for credit losses on loans to non-performing assets		48.08			N/A			48.08			N/A
Net charge-offs (recoveries) to average gross loans (annualized)		0.08	%		0.00	%		0.02	%		0.00	%
*Concentration Ratios*
Commercial real estate loans to total capital (4)		372.48	%		370.05	%		372.48	%		370.05	%
Construction loans to total capital (5)		138.79	%		137.51	%		138.79	%		137.51	%
*Non-performing Assets*
Loans 30-89 days past due to total gross loans		0.05	%		0.17	%		0.05	%		0.17	%
Loans 90 days past due to total gross loans		0.00	%		0.02	%		0.00	%		0.02	%
Non-accrual loans to total gross loans		0.02	%		0.00	%		0.02	%		0.00	%
Other real estate owned	$	—		$	—		$	—		$	—
Non-performing assets	$	325		$	—		$	325		$	—
Non-performing assets to total assets		0.02	%		0.00	%		0.02	%		0.00	%
*Regulatory Capital Ratios (Bank only) (1)*
Total risk-based capital ratio		16.79	%		16.39	%		16.79	%		16.39	%
Tier 1 risk-based capital ratio		15.83	%		15.59	%		15.83	%		15.59	%
Leverage ratio		14.81	%		14.01	%		14.81	%		14.01	%
Common equity tier 1 ratio		15.83	%		15.59	%		15.83	%		15.59	%
*Other information*
Closing stock price	$	20.54		$	22.81		$	20.54		$	22.81
Tangible equity / tangible assets (2)		9.98	%		9.86	%		9.98	%		9.86	%
Average tangible equity / average tangible assets (2)		10.46	%		10.26	%		10.34	%		10.76	%
Number of full time equivalent employees		185			157			185			157
Number of full service branch offices		6			6			6			6

(1)	Regulatory capital ratios as of September 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

MainStreet Bancshares, Inc.
Unaudited Reconciliation of Certain Non-GAAP Financial Measures
(Dollars In thousands)

	For the three months ended September 30,						For the nine months ended September 30,
	2023			2022			2023			2022
Net interest margin (FTE)
Net interest income (GAAP)	$	18,578		$	18,096		$	58,940		$	49,413
FTE adjustment on tax-exempt securities		71			69			212			212
Net interest income (FTE) (non-GAAP)		18,649			18,165			59,152			49,625

Average interest earning assets		1,865,607			1,740,998			1,846,600			1,654,044
Net interest margin (GAAP)		3.95	%		4.12	%		4.27	%		3.99	%
Net interest margin (FTE) (non-GAAP)		3.97	%		4.14	%		4.28	%		4.01	%

	As of September 30,						As of September 30,
	2023			2022			2023			2022
Stockholders equity, adjusted
Total stockholders equity (GAAP)	$	213,743		$	190,000		$	213,743		$	190,000
Less: intangible assets		13,373			7,258			13,373			7,258
Tangible stockholders equity (non-GAAP)		200,370			182,742		$	200,370		$	182,742
Less: preferred stock		27,263			27,263			27,263			27,263
Tangible common stockholders equity (non-GAAP)		173,107			155,479			173,107			155,479

Common shares outstanding		7,524,887			7,425,432			7,524,887			7,425,432
Tangible book value per common share (non-GAAP)	$	23.00		$	20.94		$	23.00		$	20.94

	As of September 30,						As of September 30,
	2023			2022			2023			2022
Total assets, adjusted
Total assets (GAAP)	$	2,021,491		$	1,860,115		$	2,021,491		$	1,860,115
Less: intangible assets		(13,373)			(7,258)			(13,373)			(7,258)
Total tangible assets (non-GAAP)		2,008,118			1,852,857			2,008,118			1,852,857

	For the three months ended September 30,						For the nine months ended September 30,
	2023			2022			2023			2022
Average stockholders equity, adjusted
Total average stockholders equity (GAAP)	$	213,247		$	190,439		$	207,647		$	189,686
Less: average intangible assets		(12,841)			(6,192)			(11,345)			(4,570)
Total average tangible stockholders equity (non-GAAP)		200,406			184,247			196,302			185,116

	For the three months ended September 30,						For the nine months ended September 30,
	2023			2022			2023			2022
Average assets, adjusted
Total average average assets (GAAP)	$	1,929,490		$	1,802,477		$	1,909,432		$	1,725,405
Less: average intangible assets		(12,841)			(6,192)			(11,345)			(4,570)
Total average tangible assets (non-GAAP)		1,916,649			1,796,285			1,898,087			1,720,835

Contact: Debra Cope
Director of Corporate Communications
Desk (703) 481-4599
Mobile (202) 468-3184

SOURCE MainStreet Bancshares, Inc.

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