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MainStreet Bancshares Inc. Reports a Profitable First Quarter

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MainStreet Bancshares Inc. reported a profitable first quarter with a net income of $2.77 million. The company experienced a slight decrease in net interest margin due to increased deposit costs but maintains strong credit quality. MainStreet Bank continues to show low levels of past due and non-performing loans, particularly in the D.C. metropolitan area. The company is focused on improving funding costs and building positive business relationships for future growth.
MainStreet Bancshares Inc. ha riportato un primo trimestre di profitto con un reddito netto di 2,77 milioni di dollari. La società ha subito una leggera diminuzione del margine di interesse netto a causa dell'aumento dei costi dei depositi, ma mantiene un'alta qualità del credito. La MainStreet Bank continua a registrare bassi livelli di prestiti scaduti e non performanti, in particolare nell'area metropolitana di D.C. La compagnia è concentrata sul miglioramento dei costi di finanziamento e sullo sviluppo di relazioni commerciali positive per una crescita futura.
MainStreet Bancshares Inc. reportó un primer trimestre rentable con un ingreso neto de $2.77 millones. La compañía experimentó una ligera disminución en el margen de interés neto debido al aumento de los costos de los depósitos, pero mantiene una fuerte calidad crediticia. MainStreet Bank continúa mostrando bajos niveles de préstamos vencidos y no productivos, especialmente en el área metropolitana de D.C. La empresa se enfoca en mejorar los costos de financiamiento y en construir relaciones comerciales positivas para el crecimiento futuro.
메인스트리트 밴크셰어스 인크가 순이익 277만 달러로 수익성 있는 첫 분기를 보고했습니다. 회사는 예금 비용 증가로 인한 순이자 마진의 소폭 감소를 경험했지만 강력한 신용 품질을 유지하고 있습니다. 메인스트리트 뱅크는 특히 D.C. 대도시 지역에서 연체 및 비수행 대출의 낮은 수준을 계속 보여주고 있습니다. 회사는 자금 조달 비용을 개선하고 미래 성장을 위한 긍정적인 비즈니스 관계를 구축하는 데 집중하고 있습니다.
MainStreet Bancshares Inc. a rapporté un premier trimestre rentable avec un bénéfice net de 2,77 millions de dollars. La société a connu une légère baisse de la marge d'intérêt net due à l'augmentation des coûts des dépôts mais maintient une forte qualité de crédit. MainStreet Bank continue d'afficher des niveaux bas de prêts en retard et non performants, notamment dans la région métropolitaine de D.C. L'entreprise se concentre sur l'amélioration des coûts de financement et sur l'établissement de relations commerciales positives pour une croissance future.
MainStreet Bancshares Inc. berichtete über ein profitables erstes Quartal mit einem Nettogewinn von 2,77 Millionen Dollar. Das Unternehmen verzeichnete einen leichten Rückgang der Nettozinsmarge aufgrund gestiegener Einlagenkosten, behält jedoch eine starke Kreditqualität bei. Die MainStreet Bank zeigt weiterhin niedrige Niveaus von überfälligen und nicht leistungsorientierten Krediten, besonders im Großraum D.C. Das Unternehmen konzentriert sich darauf, die Finanzierungskosten zu verbessern und positive Geschäftsbeziehungen für zukünftiges Wachstum aufzubauen.
Positive
  • MainStreet Bancshares Inc. reported a net income of $2.77 million for the first quarter of 2024.
  • The company experienced an uptick in deposit costs, leading to a net interest margin of 3.24%.
  • MainStreet Bank maintains strong asset quality with low levels of past due and non-performing loans.
  • The D.C. metropolitan area's housing market shows strong demand and supply, benefiting MainStreet Bank.
  • The company aims to improve funding costs and deliver positive returns to shareholders.
  • MainStreet Bank focuses on building strong business relationships and managing risks effectively.
Negative
  • None.

Insights

MainStreet Bancshares Inc.'s report of $2.77 million net income for the first quarter reflects stable profitability, albeit with concerns about rising deposit costs. The compression of net interest margin to 3.24% signals a need for efficient management of interest expenses. For investors, the focus on improving funding costs is pivotal, as it may directly influence future profitability and shareholder returns. Asset quality remains robust, a positive indicator that counterbalances margin pressures. Short-term, the company's strategic emphasis on cost management and loan portfolio quality is likely to preserve financial health, while long-term success hinges on the effectiveness of these measures amidst evolving market conditions.

The banking-as-a-service (BaaS) model has faced challenges recently, with MainStreet Bancshares recognizing the need for better compliance and safety measures. Their launch of a purpose-built solution, Avenu, signals a strategic move towards a more controlled and resilient BaaS offering. The direct integration with fintech clients positions Avenu as a potentially significant player in the fintech collaboration space. For investors, the success of Avenu could unlock new revenue streams and client acquisition opportunities, especially when considering the positive outlook on the demand for embedded financial solutions. However, this is contingent on the company effectively overcoming previous tech launch delays and establishing a compelling value proposition in a competitive market.

The mention of multifamily housing in the D.C. area being free from New York City-like rent controls is noteworthy. Strong demand and limited supply in this housing market may indirectly benefit MainStreet Bancshares through increased lending opportunities and lower default risks. For investors, this implies that the bank could capitalize on a burgeoning rental market, possibly translating to a stable and growing loan portfolio. The real estate dynamics in their operational region could serve as a buffer against broader economic downturns, contributing to the company's long-term resilience.

Strong credit quality and no adverse loan portfolio trends

FAIRFAX, Va., April 22, 2024 /PRNewswire/ -- MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the holding company for MainStreet Bank, reported net income of $2.77 million for the first quarter of 2024.

"Our loan portfolio was well-positioned for the current interest rate cycle and continues to generate strong and sustainable interest income.  During the first quarter of 2024, we experienced an uptick in deposit costs, compressing the net interest margin to 3.24%," said Jeff W. Dick, Chairman & CEO of MainStreet Bancshares, Inc. and MainStreet Bank.  "We are focused on improving our funding costs for the remainder of 2024 and anticipate that our cumulative performance ratios will reflect our ability to do so, as we build for the future and deliver positive returns to our shareholders."

The Company continues to experience strong asset quality with relatively low levels of past due and non-performing loans.  It should be noted that multifamily housing in the Washington, D.C. metropolitan area is devoid of the type of rent controls experienced in New York City.  Demand for housing in our market far outstrips supply and the rental markets are strong.

"Our lending team is very focused on their borrowers and relationships at this time," said Tom Floyd, Chief Lending Officer at MainStreet Bank.  "We want to make sure that if any issues or concerns do arise, we recognize them early in order to properly manage risk and work together toward positive outcomes."

"We are laser-focused on growing good business relationships throughout the metropolitan area," said Abdul Hersiburane, President of MainStreet Bank.  "Our best source is our existing client base, as the quality of our service and attention to detail is second to none."

Banking-as-a-Service
The headlines were bleak in 2023 for several of the banks providing banking-as-a-service to fintechs.  In one instance, consultant Kate Drew wrote, "The truth is many of the most jarring headlines have involved sponsor banks and fintech partners that had little to no relationship at all, and instead operated through a banking-as-a-service provider.  That model is all but dead.  In its place will likely emerge a more resilient proposition that puts the bank in the driver's seat when it comes to compliance and focuses on fintechs with sustainable businesses and realistic objectives in financial services."  Drew, Kate (December 12, 2023), Where is Banking-as-a Service Headed in 2024? Forbes Media L.L.C.

"Our one miss was underestimating the amount of time it would take to build and launch the technology that we designed," said Dick.  "With hindsight, the timing is perfect as we launch a solution that is purpose-built to meet the compliance and safety and soundness needs required not only by us but also by the industry. We are the resilient solution fintechs have been waiting for."

Avenu
Avenu is the only embedded banking solution that connects our partners and their apps directly and seamlessly to our purpose-built Avenu core solution. We are not a sponsor bank without our own technology, and we are not a middleware software company without our own bank. We are Avenu, a leading financial technology company owned by an established community bank in the heart of Washington, D.C.

Avenu's 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 creating 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 and ICS – solutions that provides multi-million-dollar FDIC insurance. Further information can be obtained by visiting mstreetbank.com/ics-cdars.

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, adverse changes caused by geopolitical risks at the national and global level, adverse impact of a local, national or global health crisis, 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)






March 31,
2024



December
31, 2023*



September
30, 2023



June 30,
2023



March 31,
2023


ASSETS





















Cash and cash equivalents





















Cash and due from banks


$

49,208



$

53,581



$

44,912



$

67,700



$

225,334


Federal funds sold



75,533




60,932




76,271




30,341





Total cash and cash equivalents



124,741




114,513




121,183




98,041




225,334


Investment securities available for sale, at fair value



58,699




59,928




56,726




60,579




63,209


Investment securities held to maturity, at amortized
cost, net of allowance for credit losses of $0 for all
periods



17,251




17,275




17,565




17,590




17,616


Restricted equity securities, at amortized cost



23,924




24,356




20,619




20,304




22,436


Loans, net of allowance for credit losses of $16,531,
$16,506, $15,626, $16,047, and $15,435, respectively



1,727,110




1,705,137




1,681,444




1,637,484




1,617,275


Premises and equipment, net



14,081




13,944




14,275




14,427




14,521


Accrued interest and other receivables



10,727




12,390




11,184




10,256




9,744


Computer software, net of amortization



15,691




14,657




13,373




12,266




10,559


Bank owned life insurance



38,609




38,318




38,035




37,763




37,503


Other assets



39,182




34,914




47,087




40,641




36,811


Total Assets


$

2,070,015



$

2,035,432



$

2,021,491



$

1,949,351



$

2,055,008


LIABILITIES AND STOCKHOLDERS' EQUITY





















Liabilities:





















Non-interest bearing deposits


$

348,945



$

364,606



$

394,859



$

388,992



$

487,875


Interest bearing demand deposits



165,331




137,128




76,423




71,308




100,522


Savings and NOW deposits



46,036




45,878




46,550




51,294




53,499


Money market deposits



446,903




442,179




461,398




380,500




260,316


Time deposits



725,520




696,336




703,960




701,289




730,076


Total deposits



1,732,735




1,686,127




1,683,190




1,593,383




1,632,288


Federal funds purchased






15,000







30,000




60,696


Federal Home Loan Bank advances















45,000


Subordinated debt



72,741




72,642




72,543




72,444




72,344


Other liabilities



41,418




40,146




52,015




43,016




39,692


Total Liabilities



1,846,894




1,813,915




1,807,748




1,738,843




1,850,020


Stockholders' Equity:





















Preferred stock



27,263




27,263




27,263




27,263




27,263


Common stock



29,514




29,198




29,188




29,177




29,185


Capital surplus



65,940




65,985




65,407




64,768




64,213


Retained earnings



108,334




106,549




102,694




97,646




91,991


Accumulated other comprehensive loss



(7,930)




(7,478)




(10,809)




(8,346)




(7,664)


Total Stockholders' Equity



223,121




221,517




213,743




210,508




204,988


Total Liabilities and Stockholders' Equity


$

2,070,015



$

2,035,432



$

2,021,491



$

1,949,351



$

2,055,008



*Derived from audited financial statements

 

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






Three Months Ended




March 31,
2024



December 31,
2023



September
30, 2023



June 30, 2023



March 31,
2023


INTEREST INCOME:





















Interest and fees on loans


$

30,487



$

30,849



$

29,750



$

28,855



$

26,731


Interest on investment securities





















Taxable securities



435




451




459




407




518


Tax-exempt securities



270




268




268




265




264


Interest on federal funds sold



1,182




1,510




1,217




1,179




1,132


Total interest income



32,374




33,078




31,694




30,706




28,645


INTEREST EXPENSE:





















Interest on interest bearing demand deposits



1,860




1,058




240




251




343


Interest on savings and NOW deposits



157




146




145




147




108


Interest on money market deposits



5,178




5,639




4,156




2,926




1,203


Interest on time deposits



8,833




8,257




7,526




7,077




4,144


Interest on federal funds purchased



107




25




35




201




38


Interest on Federal Home Loan Bank advances



46




118




186




13




906


Interest on subordinated debt



820




828




828




820




812


Total interest expense



17,001




16,071




13,116




11,435




7,554


Net interest income



15,373




17,007




18,578




19,271




21,091


(Recovery of) provision for credit losses



(195)




466




255




638




283


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



15,568




16,541




18,323




18,633




20,808


NON-INTEREST INCOME:





















Deposit account service charges



469




510




514




535




590


Bank owned life insurance income



292




283




272




259




255


Other non-interest income



130




68




177




16




158


Total other income



891




861




963




810




1,003


NON-INTEREST EXPENSES:





















Salaries and employee benefits



7,488




7,129




6,924




6,595




7,621


Furniture and equipment expenses



935




804




713




772




498


Advertising and marketing



454




271




577




698




797


Occupancy expenses



435




397




375




426




486


Outside services



774




352




697




504




490


Administrative expenses



242




219




277




211




215


Other operating expenses



1,996




1,964




1,866




1,646




1,596


Total non-interest expenses



12,324




11,136




11,429




10,852




11,703


Income before income tax expense



4,135




6,266




7,857




8,591




10,108


Income tax expense



830




1,120




1,516




1,645




1,957


Net income



3,305




5,146




6,341




6,946




8,151


Preferred stock dividends



539




539




539




539




539


Net income available to common shareholders


$

2,766



$

4,607



$

5,802



$

6,407



$

7,612


Net income per common share, basic and diluted


$

0.36



$

0.61



$

0.77



$

0.85



$

1.01


Weighted average number of common shares, basic and
diluted



7,611,990




7,527,327




7,524,332




7,522,764




7,517,213


 

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




March 31, 2024



December 31, 2023



March 31, 2023



Percentage Change




$ Amount



% of
Total



$ Amount



% of
Total



$ Amount



% of
Total



Last 3
Mos



Last 12
Mos


LOANS:

































Construction and land development loans


$

408,903




23.4

%


$

429,637




24.9

%


$

415,078




25.3

%



-4.8

%



-1.5

%

Residential real estate loans



451,991




25.8

%



474,602




27.5

%



391,648




23.9

%



-4.8

%



15.4

%

Commercial real estate loans



813,387




46.5

%



743,827




43.1

%



737,019




45.0

%



9.4

%



10.4

%

Commercial and industrial loans



71,822




4.1

%



75,415




4.4

%



86,937




5.3

%



-4.8

%



-17.4

%

Consumer loans



2,902




0.2

%



3,610




0.1

%



7,534




0.5

%



-19.6

%



-61.5

%

Total Gross Loans


$

1,749,005




100.0

%


$

1,727,091




100.0

%


$

1,638,216




100.0

%



1.3

%



6.8

%

Less: Allowance for credit losses



(16,531)








(16,506)








(15,435)














Net deferred loan fees



(5,364)








(5,448)








(5,506)














Net Loans


$

1,727,110







$

1,705,137







$

1,617,275














DEPOSITS:

































Non-interest bearing deposits


$

348,945




20.1

%


$

364,606




21.6

%


$

487,875




29.9

%



-4.3

%



-28.5

%

Interest-bearing deposits:

































Demand deposits



165,331




9.5

%



137,128




8.1

%



100,522




6.2

%



20.6

%



64.5

%

Savings and NOW deposits



46,036




2.7

%



45,878




2.7

%



53,499




3.3

%



0.3

%



-13.9

%

Money market accounts



446,903




25.8

%



442,179




26.2

%



260,316




15.9

%



1.1

%



71.7

%

Certificates of deposit $250,000 or
more



467,892




27.0

%



442,662




26.3

%



458,683




28.1

%



5.7

%



2.0

%

Certificates of deposit less than
$250,000



257,628




14.9

%



253,674




15.1

%



271,393




16.6

%



1.6

%



-5.1

%

Total Deposits


$

1,732,735




100.0

%


$

1,686,127




100.0

%


$

1,632,288




100.0

%



2.8

%



6.2

%

BORROWINGS:

































Federal funds purchased






0.0

%



15,000




17.1

%



60,696




34.1

%



-100.0

%



-100.0

%

Federal Home Loan Bank advances






0.0

%






0.0

%



45,000




25.3

%



0.0

%



-100.0

%

Subordinated debt



72,741




100.0

%



72,642




82.9

%



72,344




40.6

%



0.1

%



0.5

%

Total Borrowings


$

72,741




100.0

%


$

87,642




100.0

%


$

178,040




100.0

%



-17.0

%



-59.1

%

Total Deposits and Borrowings


$

1,805,476







$

1,773,769







$

1,810,328








1.8

%



-0.3

%


































Core customer funding sources (1)


$

1,312,746




72.7

%


$

1,252,534




70.7

%


$

1,156,279




63.9

%



4.8

%



13.5

%

Brokered and listing service sources (2)



419,989




23.3

%



433,593




24.4

%



476,009




26.3

%



-3.1

%



-11.8

%

Federal funds borrowed






0.0

%



15,000




0.8

%



60,696




3.3

%



-100.0

%



-100.0

%

Federal Home Loan Bank advances






0.0

%






0.0

%



45,000




2.5

%



0.0

%



-100.0

%

Subordinated debt (3)



72,741




4.0

%



72,642




4.1

%



72,344




4.0

%



0.1

%



0.5

%

Total Funding Sources


$

1,805,476




100.0

%


$

1,773,769




100.0

%


$

1,810,328




100.0

%



1.8

%



-0.3

%


(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.


Excludes $210.9 million in core deposits placed in reciprocal networks for FDIC insurance coverage that will be classified as brokered deposits on the call report in pursuant to rule 12 CFR 337.6(e) as of March 31, 2024.

(3)

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

 

MainStreet Bancshares, Inc U
NAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES
(In thousands)




For the three months ended March 31,
2024



For the three months ended March 31,
2023




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)


$

1,728,761



$

30,487




7.07

%


$

1,599,756



$

26,731




6.78

%

Securities:

























Taxable



56,001




435




3.12

%



57,600




518




3.65

%

Tax-exempt



37,420




342




3.66

%



37,941




334




3.57

%

Federal funds and interest
bearing deposits



91,993




1,182




5.15

%



118,670




1,132




3.87

%

Total interest-earning assets


$

1,914,175



$

32,446




6.80

%


$

1,813,967



$

28,715




6.42

%

Other assets



123,294












71,704










Total assets


$

2,037,469











$

1,885,671










Liabilities and Stockholders' Equity:

























Interest-bearing liabilities:

























Interest-bearing demand
deposits


$

146,248



$

1,860




5.10

%


$

83,388



$

343




1.67

%

Savings and NOW deposits



44,219




157




1.42

%



51,943




108




0.84

%

Money market deposit accounts



433,654




5,178




4.79

%



225,037




1,203




2.17

%

Time deposits



710,019




8,833




4.99

%



673,441




4,144




2.50

%

Total interest-bearing deposits


$

1,334,140



$

16,028




4.82

%


$

1,033,809



$

5,798




2.27

%

Federal funds borrowed



7,476




107




5.74

%



2,965




38




5.20

%

FHLB advances



3,297




46




5.60

%



77,833




906




4.72

%

Subordinated debt



72,703




820




4.52

%



72,306




812




4.55

%

Total interest-bearing liabilities


$

1,417,616



$

17,001




4.81

%


$

1,186,913



$

7,554




2.58

%

Demand deposits and other liabilities



397,753












497,155










Total liabilities


$

1,815,369











$

1,684,068










Stockholders' Equity



222,100












201,603










Total Liabilities and Stockholders'
Equity


$

2,037,469











$

1,885,671










Interest Rate Spread











1.99

%











3.84

%

Net Interest Income






$

15,445











$

21,161






Net Interest Margin











3.24

%











4.73

%


(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




March 31,




2024



2023


Per share Data and Shares Outstanding









Earnings per common share (basic and diluted)


$

0.36



$

1.01


Book value per common share


$

25.72



$

23.62


Tangible book value per common share(2)


$

23.66



$

22.22


Weighted average common shares (basic and diluted)



7,611,990




7,517,213


Common shares outstanding at end of period



7,614,090




7,524,277


Performance Ratios









Return on average assets (annualized)



0.65

%



1.75

%

Return on average equity (annualized)



5.97

%



16.40

%

Return on average common equity (annualized)



5.69

%



17.71

%

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



6.80

%



6.42

%

Cost of interest bearing liabilities (annualized)



4.81

%



2.58

%

Net interest spread (FTE)(2)



1.99

%



3.84

%

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



3.24

%



4.73

%

Noninterest income as a percentage of average assets (annualized)



0.18

%



0.22

%

Noninterest expense to average assets (annualized)



2.43

%



2.52

%

Efficiency ratio(3)



75.77

%



52.97

%

Asset Quality









Allowance for credit losses (ACL)









Beginning balance, ACL - loans


$

16,506



$

14,114


Add: current expected credit losses, nonrecurring adoption






895


Add: recoveries



2




11


Less: charge-offs



(141)





Add: provision for (recovery of) credit losses - loans



164




415


Ending balance, ACL - loans


$

16,531



$

15,435











Beginning balance, reserve for unfunded commitment (RUC)


$

1,009



$


Add: current expected credit losses, nonrecurring adoption






1,310


Add: provision for (recovery of) unfunded commitments, net



(359)




(132)


Ending balance, RUC


$

650



$

1,178


Total allowance for credit losses


$

17,181



$

16,613











Allowance for credit losses on loans to total gross loans



0.95

%



0.94

%

Allowance for credit losses to total gross loans



0.98

%



1.01

%

Allowance for credit losses on loans to non-performing loans



1.78X




N/A


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



0.03

%



0.00

%

Concentration Ratios









Commercial real estate loans to total capital (4)



364.65

%



372.12

%

Construction loans to total capital (5)



130.06

%



140.78

%

Non-performing Assets









Loans 30-89 days past due to total gross loans



0.22

%



0.00

%

Loans 90 days past due to total gross loans



0.51

%



0.00

%

Non-accrual loans to total gross loans



0.53

%



0.00

%

Other real estate owned


$



$


Non-performing loans


$

9,263



$


Non-performing assets to total assets



0.45

%



0.00

%

Regulatory Capital Ratios (Bank only)(1)









Total risk-based capital ratio



17.05

%



16.35

%

Tier 1 risk-based capital ratio



16.12

%



15.49

%

Leverage ratio



14.54

%



14.69

%

Common equity tier 1 ratio



16.12

%



15.49

%

Other information









Closing stock price


$

18.16



$

23.49


Tangible equity / tangible assets (2)



10.10

%



9.51

%

Average tangible equity / average tangible assets (2)



10.24

%



10.22

%

Number of full time equivalent employees



191




170


Number of full service branch offices



6




6



(1)

Regulatory capital ratios as of March 31, 2024 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 March
31,




2024



2023


Net interest margin (FTE)









Net interest income (GAAP)


$

15,373



$

21,091


FTE adjustment on tax-exempt securities



72




70


Net interest income (FTE) (non-GAAP)



15,445




21,161











Average interest earning assets



1,914,175




1,813,967


Net interest margin (GAAP)



3.22

%



4.72

%

Net interest margin (FTE) (non-GAAP)



3.24

%



4.73

%




For the three months ended March
31,




2024



2023


Yield on earning assets (FTE)









Total interest income


$

32,374



$

28,645


FTE adjustment on tax-exempt securities



72




70


Total interest income (FTE) (non-GAAP)



32,446




28,715











Average interest earning assets



1,914,175




1,813,967


Yield on earning assets (GAAP)



6.78

%



6.40

%

Yield on earning assets (FTE) (non-GAAP)



6.80

%



6.42

%




For the three months ended
March 31,




2024



2023


Net interest spread (FTE)









Yield on earning assets (GAAP)



6.78

%



6.40

%

Yield on earning assets (FTE) (non-GAAP)



6.80

%



6.42

%










Yield on interest-bearing liabilities



4.81

%



2.58

%

Net interest spread (GAAP)



1.97

%



3.82

%

Net interest spread (FTE) (non-GAAP)



1.99

%



3.84

%




As of March 31,




2024



2023


Tangible common stockholders' equity









Total stockholders' equity (GAAP)


$

223,121



$

204,988


Less: intangible assets



(15,691)




(10,559)


Tangible stockholders' equity (non-GAAP)



207,430




194,429


Less: preferred stock



(27,263)




(27,263)


Tangible common stockholders' equity (non-GAAP)



180,167




167,166











Common shares outstanding



7,614,090




7,524,277


Tangible book value per common share (non-GAAP)


$

23.66



$

22.22





As of March 31,




2024



2023


Total tangible assets









Total assets (GAAP)


$

2,070,015



$

2,055,008


Less: intangible assets



(15,691)




(10,559)


Total tangible assets (non-GAAP)



2,054,324




2,044,449





For the three months ended March
31,




2024



2023


Average tangible stockholders' equity









Total average stockholders' equity (GAAP)


$

222,100



$

201,603


Less: average intangible assets



(15,078)




(9,879)


Total average tangible stockholders' equity (non-GAAP)



207,022




191,724





For the three months ended March
31,




2024



2023


Average tangible assets









Total average assets (GAAP)


$

2,037,469



$

1,885,671


Less: average intangible assets



(15,078)




(9,879)


Total average tangible assets (non-GAAP)



2,022,391




1,875,792


   

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

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/mainstreet-bancshares-inc-reports-a-profitable-first-quarter-302122996.html

SOURCE MainStreet Bancshares, Inc.

FAQ

What was MainStreet Bancshares Inc.'s net income for the first quarter of 2024?

MainStreet Bancshares Inc. reported a net income of $2.77 million for the first quarter of 2024.

What affected MainStreet Bancshares Inc.'s net interest margin in the first quarter of 2024?

Increased deposit costs led to a net interest margin of 3.24% for MainStreet Bancshares Inc. in the first quarter of 2024.

How is MainStreet Bank's asset quality described in the press release?

MainStreet Bank maintains strong asset quality with relatively low levels of past due and non-performing loans.

What type of housing market conditions benefit MainStreet Bank according to the PR?

The D.C. metropolitan area's housing market, with strong demand and supply, benefits MainStreet Bank.

What is MainStreet Bancshares Inc.'s focus for future growth?

MainStreet Bancshares Inc. aims to improve funding costs and build positive business relationships for future growth.

MainStreet Bancshares, Inc.

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