MainStreet Bancshares, Inc. Reports Record Second Quarter 2021 Earnings

FAIRFAX, Va., July 20, 2021 /PRNewswire/ -- MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the holding company for MainStreet Bank, reported net income of $7.1 million for the second quarter of 2021.  This represents a 16.3% Return on Average Equity, a 1.7% Return on Average Assets, $0.87 per share of common stock (basic and diluted), and a book value of $20.18 per common share. 

Our mid-year performance is the result of a strong effort across every part of the Company

Net interest income of $13.0 million and noninterest income of $1.6 million for the quarter-ended June 30, 2021 are up 21% and 18% respectively from the same period in 2020. 

The Company's cost of funds for the quarter-ended June 30, 2021 is 1.1%, which is improved 37% from the same period a year earlier. The Company remains focused on reducing funding costs, increasing fee income, and improving operating efficiency. The Company's efficiency ratio is 54% for the quarter-ended June 30, 2021, an 11% improvement from the 61% efficiency ratio reported for the same period a year ago.

Total assets were $1.7 billion on June 30, 2021, an increase of 12% from June 30, 2020.  Net loans were $1.3 billion on June 30, 2021, which includes the SBA forgiveness of $55 million of Paycheck Protection Program loan balances during the quarter. Asset quality continues to be strong with non-performing assets representing 0.07% of total assets on June 30, 2021. 

Non-interest bearing deposits represent a solid one-third of the $1.5 billion in total deposits as of June 30, 2021.  In addition, 74% of the Company's total deposits are designated as "core deposits". 

A year ago, the Company made a special provision to the Allowance for Loan and Lease Losses (ALLL) based upon an assessment of the potential impact from the COVID 19 pandemic.  At that time little was known about the pandemic.  A year later and despite the pandemic, the loan portfolio remains strong and continues to perform well.  The local economy also continues to be robust and is quickly recovering from the effects of the pandemic.  The Company updated its assessment as of June 30, 2021 and decided to release $2.1 million of that special provision.   The table below provides a recap of activities relating to the special COVID provision over the past 12 months ending June 30, 2021.

June 30, 2020 Special COVID Provision Adjustments
(000's)
Starting Balance June 30, 2020	$4,522
+ COVID Provision for loans originated between 6/30/2020 and 6/30/2021	658
- Release for recovered/repaid loan 12/31/2020	1,460
- Charged off loan 12/31/2020	300
- Release for indirect loans 03/31/2021	760
- Release for commercial portfolio 6/30/2021	2,135
Ending Balance June 30, 2021	$525

The $525,000 ending balance represents a 40 basis-point special COVID provision for the portfolio of hotel loans.  The portfolio of hotel loans is experiencing month-on-month improvements in occupancy rates and room rates, but the Company determined that it is prudent to maintain a special provision for the portfolio of hotel loans.

"Our mid-year performance is the result of a strong effort across every part of the Company," said Abdul Hersiburane, President of MainStreet Bank.  "We continue to work very closely with our customers; as a community bank, our success is a direct reflection of our customer's success.  To that end, we are focused on growing new client relationships who appreciate the high level of quality and service that comes standard from MainStreet Bank."

"As a Company that embraced leading-edge technology from the start, I am pleased to report that we performed exceptionally well throughout the pandemic," said Jeff W. Dick, Chairman & CEO of MainStreet Bancshares, Inc. and MainStreet Bank.  "That same focus on technology provides us with a platform to scale the delivery of our products and services as we grow, and to continue to improve upon our operating efficiency.  But the true value of our Company is derived from the team of people who bring that technology to life each day – whether from home or at the office."

ABOUT MAINSTREET BANK:  MainStreet operates seven branches in Herndon, Fairfax, Fairfax City, 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 full complement of payment solutions for financial technology companies and has a team ready to create a perfect solution for their needs.

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

MainStreet Bank was the first community bank in the Washington, DC metropolitan area to offer a full online business banking solution.  MainStreet Bank was also the first bank headquartered in the Commonwealth of Virginia to offer CDARS – a solution that provides multi-million-dollar FDIC insurance.  Further information on the Bank can be obtained by visiting its website at mstreetbank.com. This release contains forward-looking statements, including our expectations with respect to future events that are subject to various risks and uncertainties.  The statements contained in this release that are not historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Words such as "may," "will," "could," "should," "expect," "plan," "project," "intend," "anticipate," "believe," "estimate," "predict," "potential," "pursuant," "target," "continue," and similar expressions are intended to identify such forward-looking statements. Factors that could cause actual results to differ materially from management's projections, forecasts, estimates and expectations include: fluctuation in market rates of interest and loan and deposit pricing, adverse changes in the overall national economy as well as adverse economic conditions in our specific market areas, future impacts of the novel coronavirus (COVID-19) outbreak, maintenance and development of well-established and valued client relationships and referral source relationships, and acquisition or loss of key production personnel.

We caution readers that the list of factors above is not exclusive. The forward-looking statements are made as of the date of this release, and we may not undertake steps to update the forward-looking statements to reflect the impact of any circumstances or events that arise after the date the forward-looking statements are made.  In addition, our past results of operations are not necessarily indicative of future performance.

Contact: Jeff W. Dick, Chairman & CEO
(703) 481-4567

 

UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION (In thousands, except share data)
		June 30, 2021				March 31, 2021				December 31, 2020				September 30, 2020				June 30, 2020
ASSETS
Cash and cash equivalents
Cash and due from banks		$	120,121			$	118,399			$	75,935			$	102,480			$	55,273
Federal funds sold			56,164				51,598				31,593				25,074				21,081
Total cash and cash equivalents			176,285				169,997				107,528				127,554				76,354
Investment securities available for sale, at fair value			165,791				180,028				147,414				118,844				91,823
Investment securities held to maturity, at carrying value			26,136				26,427				22,520				23,114				23,843
Restricted equity securities, at cost			5,039				4,664				4,616				4,616				5,041
Loans held for sale			—				—				57,006				—				—
Loans, net of allowance for loan losses of $11,133, $13,215, $12,877, $14,346, and $13,731, respectively			1,256,436				1,299,169				1,230,379				1,279,899				1,259,012
Premises and equipment, net			13,929				13,975				14,289				14,474				14,416
Other real estate owned, net			1,158				1,180				1,180				1,580				1,175
Accrued interest and other receivables			8,752				9,349				9,604				8,579				7,458
Bank owned life insurance			35,736				25,518				25,341				25,157				24,959
Other assets			18,433				12,722				23,288				26,371				24,786
Total Assets		$	1,707,695			$	1,743,029			$	1,643,165			$	1,630,188			$	1,528,867
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Non-interest bearing deposits		$	486,001			$	492,463			$	370,497			$	416,648			$	388,104
Interest bearing DDA deposits			68,028				69,180				70,307				72,807				18,266
Savings and NOW deposits			72,353				72,259				74,099				69,015				65,876
Money market deposits			310,303				342,468				426,600				348,146				332,246
Time deposits			528,247				561,772				496,743				510,429				537,840
Total deposits			1,464,932				1,538,142				1,438,246				1,417,045				1,342,332
Federal Home Loan Bank advances and other borrowings			—				—				—				—				10,000
Subordinated debt			40,576				14,841				14,834				14,827				14,819
Other liabilities			22,559				17,868				22,420				25,055				21,546
Total Liabilities			1,528,067				1,570,851				1,475,500				1,456,927				1,388,697
Stockholders' Equity:
Preferred stock			27,263				27,263				27,263				27,527				—
Common stock			29,446				29,437				29,130				32,460				32,433
Capital surplus			66,667				66,233				66,116				75,217				74,850
Retained earnings			55,676				49,090				44,179				37,105				31,933
Accumulated other comprehensive income			576				155				977				952				954
Total Stockholders' Equity			179,628				172,178				167,665				173,261				140,170
Total Liabilities and Stockholders' Equity		$	1,707,695			$	1,743,029			$	1,643,165			$	1,630,188			$	1,528,867

 

 

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION (In thousands, except share and per share data)
		Year-to-Date								Three Months Ended
		June 30, 2021				June 30, 2020				June 30, 2021				March 31, 2021				December 31, 2020				September 30, 2020				June 30, 2020
INTEREST INCOME:
Interest and fees on loans		$	31,049			$	28,619			$	15,257			$	15,792			$	15,933			$	15,083			$	14,399
Interest on investment securities			1,127				997				597				530				519				491				496
Interest on federal funds sold			35				404				20				15				15				12				9
Total interest income			32,211				30,020				15,874				16,337				16,467				15,586				14,904
INTEREST EXPENSE:
Interest on interest bearing DDA deposits			110				153				55				55				108				56				36
Interest on savings and NOW deposits			89				114				47				42				52				55				50
Interest on money market deposits			497				1,252				220				277				418				490				474
Interest on time deposits			4,244				6,900				1,994				2,250				2,583				2,841				3,333
Interest on Federal Home Loan Bank    advances and other borrowings			—				94				—				—				—				13				44
Interest on subordinated debt			805				482				567				238				240				245				241
Total interest expense			5,745				8,995				2,883				2,862				3,401				3,700				4,178
Net interest income			26,466				21,025				12,991				13,475				13,066				11,886				10,726
Provision for (recovery of) loan losses			(1,760)				5,925				(2,080)				320				(2,950)				635				5,575
Net interest income after provision    for (recovery of) loan losses			28,226				15,100				15,071				13,155				16,016				11,251				5,151
NON-INTEREST INCOME:
Deposit account service charges			1,160				920				621				539				509				487				433
Bank owned life insurance income			395				397				218				177				183				199				198
Loan swap fee income			—				826				—				—				833				1,851				423
Net gain on held-to-maturity securities			3				—				—				3				—				—				—
Net gain on sale of loans			474				—				130				344				—				33				—
Other fee income			969				589				586				383				378				288				264
Total other income			3,001				2,732				1,555				1,446				1,903				2,858				1,318
NON-INTEREST EXPENSES:
Salaries and employee benefits			9,430				8,696				4,663				4,767				4,746				4,495				4,263
Furniture and equipment expenses			1,026				954				500				526				601				574				500
Advertising and marketing			677				447				402				275				290				266				191
Occupancy expenses			693				578				387				306				360				332				311
Outside services			616				481				280				336				263				215				205
Administrative expenses			291				341				141				150				166				167				177
Other operating expenses			2,950				3,005				1,500				1,449				1,732				1,589				1,713
Total other expenses			15,683				14,502				7,873				7,809				8,158				7,638				7,360
Income before income tax expense (benefit)			15,544				3,330				8,753				6,792				9,761				6,471				(891)
Income tax expense (benefit)			2,969				494				1,627				1,342				2,051				1,299				(257)
Net Income (loss)			12,575				2,836				7,126				5,450				7,710				5,172				(634)
Preferred stock dividends			1,078				—				539				539				635				—				—
Net income (loss) available to common shareholders			11,497			$	2,836			$	6,587			$	4,911			$	7,075			$	5,172			$	(634)
Net income (loss) per common share,    basic and diluted			1.53			$	0.34			$	0.87			$	0.65			$	0.92			$	0.63			$	(0.08)
Weighted average number of common shares,    basic and diluted			7,535,061				8,275,344				7,546,452				7,523,547				7,700,470				8,272,570				8,263,370

 

 

UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL (In thousands)
		June 30, 2021								March 31, 2021								June 30, 2020								Percentage Change
		$ Amount				% of Total				$ Amount				% of Total				$ Amount				% of Total				Last 3 Mos				Last 12 Mos
LOANS:
Construction and land development loans		$	328,480				25.8	%		$	327,393				24.8	%		$	283,971				22.2	%			0.3	%			15.7	%
Residential real estate loans			190,426				14.9	%			181,649				13.8	%			171,411				13.4	%			4.8	%			11.1	%
Commercial real estate loans			503,514				39.5	%			499,133				37.8	%			497,279				38.8	%			0.9	%			1.3	%
Commercial industrial loans - Other			93,837				7.4	%			92,680				7.0	%			96,640				7.6	%			1.2	%			-2.9	%
Commercial industrial loans - PPP Loans			124,578				9.8	%			179,835				13.6	%			171,650				13.4	%			-30.7	%			-27.4	%
Consumer loans			33,643				2.6	%			39,564				3.0	%			59,551				4.6	%			-15.0	%			-43.5	%
Total Gross Loans		$	1,274,478				100.0	%		$	1,320,254				100.0	%		$	1,280,502				100.0	%			-3.5	%			-0.5	%
Less: Allowance for loan losses			(11,133)								(13,215)								(13,731)
Net deferred loan fees			(6,909)								(7,870)								(7,759)
Net Loans		$	1,256,436							$	1,299,169							$	1,259,012
DEPOSITS:
Non-interest bearing demand deposits		$	486,001				33.2	%			492,463				32.0	%		$	388,104				28.9	%			-1.3	%			25.2	%
Interest-bearing demand deposits:
Demand deposits			68,028				4.6	%			69,180				4.5	%			18,266				1.4	%			-1.7	%			272.4	%
Savings and NOW deposits			72,353				4.9	%			72,259				4.7	%			65,876				4.9	%			0.1	%			9.8	%
Money market accounts			310,303				21.2	%			342,468				22.3	%			332,246				24.8	%			-9.4	%			-6.6	%
Certificates of deposit $250,000 or more			303,769				20.7	%			287,154				18.7	%			213,051				15.9	%			5.8	%			42.6	%
Certificates of deposit less than $250,000			224,478				15.4	%			274,618				17.8	%			324,789				24.1	%			-18.3	%			-30.9	%
Total Deposits		$	1,464,932				100.0	%		$	1,538,142				100.0	%		$	1,342,332				100.0	%			-4.8	%			9.1	%
BORROWINGS:
Federal Home Loan Bank advances			—				0.0	%			—				0.0	%			10,000				40.3	%			0.0	%			-100.0	%
Subordinated debt			40,576				100.0	%			14,841				100.0	%			14,819				59.7	%			173.4	%			173.8	%
Total Borrowings		$	40,576				100.0	%		$	14,841				100.0	%		$	24,819				100.0	%			173.4	%			63.5	%
Total Deposits and Borrowings		$	1,505,508							$	1,552,983							$	1,367,151								-3.1	%			10.1	%
Core customer funding sources (1)		$	1,118,795				74.3	%		$	1,159,207				74.6	%		$	939,474				68.7	%			-3.5	%			19.1	%
Brokered and listing service sources (2)			346,137				23.0	%			378,935				24.4	%			402,858				29.5	%			-8.7	%			-14.1	%
Federal Home Loan Bank advances			—				0.0	%			—				0.0	%			10,000				0.7	%			0.0	%			-100.0	%
Subordinated debt (3)			40,576				2.7	%			14,841				1.0	%			14,819				1.1	%			173.4	%			173.8	%
Total Funding Sources		$	1,505,508				100.0	%		$	1,552,983				100.0	%		$	1,367,151				100.0	%			-3.1	%			10.1	%

(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, 2021												For the three months ended June 30, 2020
		Average Balance				Interest Income/ Expense				Average Yields/ Rate (annualized)				Average Balance				Interest Income/ Expense				Average Yields/ Rate (annualized)
ASSETS:
Interest earning assets:
Loans (1)(2)(3)		$	1,302,722			$	15,257				4.70	%		$	1,213,250			$	14,399				4.76	%
Investment securities			90,820				597				2.64	%			73,186				496				2.72	%
Federal funds and interest-bearing deposits			245,257				20				0.03	%			126,164				9				0.03	%
Total interest earning assets		$	1,638,799			$	15,874				3.89	%		$	1,412,600			$	14,904				4.23	%
Other assets			69,950												69,741
Total assets		$	1,708,749											$	1,482,341
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits		$	68,714			$	55				0.32	%		$	17,507			$	36				0.82	%
Money market deposit accounts			322,332				220				0.27	%			303,118				474				0.63	%
Savings and NOW deposits			71,747				47				0.26	%			62,733				50				0.32	%
Time deposits			538,766				1,994				1.48	%			548,728				3,333				2.44	%
Total interest-bearing deposits		$	1,001,559			$	2,316				0.93	%		$	932,086			$	3,893				1.68	%
Federal funds and repos purchased			1				—				—				1				—				—
Subordinated debt			39,716				567				5.73	%			14,816				241				6.52	%
FHLB borrowings			—				—				—				10,000				44				1.76	%
Total interest-bearing liabilities		$	1,041,276			$	2,883				1.11	%		$	956,903			$	4,178				1.75	%
Demand deposits and other liabilities			491,857												383,480
Total liabilities		$	1,533,133											$	1,340,383
Stockholders' Equity			175,616												141,958
Total Liabilities and Stockholders' Equity		$	1,708,749											$	1,482,341
Interest Rate Spread											2.78	%											2.48	%
Net Interest Income						$	12,991											$	10,726
Net Interest Margin											3.18	%											3.05	%
Net Interest Margin, excluding PPP loans(4)											3.10	%											3.08	%

(1)	Includes loans classified as non-accrual
(2)	Includes average PPP balances of $161.8 million and related interest income of approximately $404,000 for the three months ended June 30, 2021
(3)	Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs
(4)	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, 2021												For the six months ended June 30, 2020
		Average Balance				Interest Income/ Expense				Average Yields/ Rate (annualized)				Average Balance				Interest Income/ Expense				Average Yields/ Rate (annualized)
ASSETS:
Interest earning assets:
Loans (1)(2)(3)		$	1,311,085			$	31,049				4.78	%		$	1,135,995			$	28,619				5.08	%
Investment securities			90,347				1,127				2.52	%			73,512				997				2.73	%
Federal funds and interest-bearing deposits			219,648				35				0.03	%			131,239				404				0.62	%
Total interest earning assets		$	1,621,080			$	32,211				4.01	%		$	1,340,746			$	30,020				4.52	%
Other assets			70,337												64,550
Total assets		$	1,691,417											$	1,405,296
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits		$	68,556			$	110				0.32	%		$	25,532			$	153				1.21	%
Money market deposit accounts			367,424				497				0.27	%			266,638				1,252				0.95	%
Savings and NOW deposits			70,875				89				0.25	%			62,716				114				0.37	%
Time deposits			509,465				4,244				1.68	%			557,921				6,900				2.49	%
Total interest-bearing deposits		$	1,016,320			$	4,940				0.98	%		$	912,807			$	8,419				1.86	%
Federal funds and repos purchased			—				—				—				1				—				—
Subordinated debt			27,346				805				5.94	%			14,813				482				6.56	%
FHLB borrowings			—				—				—				10,165				94				1.86	%
Total interest-bearing liabilities		$	1,043,666			$	5,745				1.11	%		$	937,786			$	8,995				1.93	%
Demand deposits and other liabilities			474,566												326,949
Total liabilities		$	1,518,232											$	1,264,735
Stockholders' Equity			173,185												140,561
Total Liabilities and Stockholders' Equity		$	1,691,417											$	1,405,296
Interest Rate Spread											2.90	%											2.59	%
Net Interest Income						$	26,466											$	21,025
Net Interest Margin											3.29	%											3.16	%
Net Interest Margin, excluding PPP loans(4)											3.15	%											3.18	%

(1)	Includes loans classified as non-accrual and loans held for sale
(2)	Includes average PPP balances of $158.0 million and related interest income of approximately $709,000 for the three months ended June 30, 2021
(3)	Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs
(4)	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,
		2021				2020			2021				2020
Per share Data and Shares Outstanding
Earnings per common share (basic and diluted)		$	0.87			$	(0.08)		$	1.53			$	0.34
Book value per common share		$	20.18			$	16.96		$	20.18			$	16.96
Weighted average common shares (basic and diluted)			7,546,452				8,263,370			7,535,061				8,275,344
Common shares outstanding at end of period			7,549,398				8,263,941			7,549,398				8,263,941
Performance Ratios
Return on average assets (annualized)			1.67	%			(0.17)	%		1.50	%			0.41	%
Return on average assets, excluding impact of PPP loans (annualized)(2)			1.44	%			(0.47)	%		1.18	%			0.29	%
Return on average equity (annualized)			16.28	%			(1.79)	%		14.64	%			4.07	%
Return on average common equity (annualized)			17.81	%			(1.79)	%		15.89	%			4.07	%
Yield on earning assets (annualized)			3.89	%			4.23	%		4.01	%			4.52	%
Cost of interest bearing liabilities (annualized)			1.11	%			1.75	%		1.11	%			1.93	%
Net interest spread			2.78	%			2.48	%		2.90	%			2.59	%
Net interest margin (annualized)			3.18	%			3.05	%		3.29	%			3.16	%
Net interest margin, excluding PPP loans (annualized)(2)			3.10	%			3.08	%		3.15	%			3.18	%
Noninterest income as a percentage of average assets (annualized)			0.37	%			0.36	%		0.36	%			0.39	%
Noninterest expense to average assets (annualized)			1.85	%			1.99	%		1.87	%			2.08	%
Efficiency ratio(3)			54.12	%			61.11	%		53.22	%			61.04	%
Asset Quality
Commercial real estate loans to total capital (4)			346.23	%			405.25	%		346.23	%			405.25	%
Construction loans to total capital (5)			154.63	%			170.04	%		154.63	%			170.04	%
Loans 30-89 days past due to total gross loans			0.07	%			0.01	%		0.07	%			0.01	%
Loans 90 days past due to total gross loans			0.00	%			0.23	%		0.00	%			0.23	%
Non-accrual loans to total gross loans			0.00	%			0.24	%		0.00	%			0.24	%
Other real estate owned		$	1,158			$	1,175		$	1,158			$	1,175
Non-performing assets		$	1,158			$	4,225		$	1,158			$	4,225
Non-performing assets to total assets			0.07	%			0.28	%		0.07	%			0.28	%
Non-performing assets to total assets, excluding PPP loans(2)			0.07	%			0.31	%		0.07	%			0.31	%
Allowance for loan losses to total gross loans			0.87	%			1.21	%		0.87	%			1.21	%
Allowance for loan losses to total loans, excluding PPP loans(2)			0.97	%			1.24	%		0.97	%			1.24	%
Allowance for loan losses to non-performing assets			9.61				3.66			9.61				3.66
Net loan charge-offs (recoveries)		$	2			$	1,742		$	(16)			$	1,778
Net charge-offs (recoveries) to average gross loans (annualized)			0.00	%			0.58	%		0.00	%			0.30	%
Net charge-offs (recoveries) to average gross loans, excluding PPP loans (annualized)(2)			0.00	%			0.65	%		0.00	%			0.32	%
Troubled debt restructurings (total)
Performing in accordance with modified terms		$	—			$	—		$	—			$	—
Not performing in accordance with modified terms		$	—			$	—		$	—			$	—
Regulatory Capital Ratios (Bank only) (1)
Total risk-based capital ratio			16.25	%			13.26	%		16.25	%			13.26	%
Tier 1 risk-based capital ratio			15.40	%			12.16	%		15.40	%			12.16	%
Leverage ratio			11.78	%			10.23	%		11.78	%			10.23	%
Common equity tier 1 ratio			15.40	%			12.16	%		15.40	%			12.16	%
Other information
Closing stock price		$	22.58			$	13.20		$	22.58			$	13.20
Equity / assets			10.52	%			9.17	%		10.52	%			9.17	%
Equity / assets, excluding PPP loans(2)			11.34	%			10.33	%		11.34	%			10.33	%
Average equity / average assets			10.28	%			9.58	%		10.24	%			10.00	%
Average equity / average assets, less average PPP loans(2)			11.35	%			10.54	%		11.29	%			10.51	%
Number of full time equivalent employees			129				121			129				121
# Full service branch offices			7				7			7				7

(1)	Regulatory capital ratios as of June 30, 2021 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 non-owner occupied and construction loans as a percentage of Bank capital
(5)	Construction loans as a percentage of Bank capital

 

 

Reconciliation of Certain Non-GAAP Financial Measures (Dollars In thousands)
		For the three months ended June 30,								For the six months ended June 30,
			2021				2020				2021				2020
Paycheck Protection Program adjustment impact
Loans held for investment (GAAP)		$	1,274,478			$	1,280,502			$	1,274,478			$	1,280,502
Less: PPP loans			124,578				171,650				124,578				171,650
Loans held for investment, excluding PPP (non-GAAP)		$	1,149,900			$	1,108,852			$	1,149,900			$	1,108,852
Average loans held for investment (GAAP)		$	1,302,722			$	1,213,250			$	1,311,085			$	1,135,995
Less: Average PPP loans			161,784				135,247				158,029				67,623
Average loans held for investment, excluding PPP (non-GAAP)		$	1,140,938			$	1,078,003			$	1,153,056				1,068,372
		For the three months ended June 30,								For the six months ended June 30,
			2021				2020				2021				2020
Net interest margin adjustment
Net interest income (GAAP)		$	12,991			$	10,726			$	26,466			$	21,025
Less: PPP fees recognized			1,180				591				2,821				591
Less: PPP interest income earned			404				337				790				337
Net interest income, excluding PPP income (non-GAAP)			11,407				9,798				22,855				20,097
Average interest earning assets (GAAP)			1,638,799				1,412,600				1,621,080				1,340,746
Less: average PPP loans			161,784				135,247				158,029				67,623
Average interest earning assets, excluding PPP (non-GAAP)			1,477,015				1,277,353				1,463,051				1,273,123
Net interest margin (GAAP)			3.18	%			3.05	%			3.29	%			3.16	%
Net interest margin, excluding PPP (non-GAAP)			3.10	%			3.08	%			3.15	%			3.18	%
		For the three months ended June 30,								For the six months ended June 30,
			2021				2020				2021				2020
Total asset adjustment
Total assets (GAAP)		$	1,707,695			$	1,528,867			$	1,707,695			$	1,528,867
Less: PPP loans			124,578				171,650				124,578				171,650
Total assets, excluding PPP loans (non-GAAP)			1,583,117				1,357,217				1,583,117				1,357,217
Total equity (GAAP)			179,628				140,170				179,628				140,170
Equity / assets, excluding PPP loans (non-GAAP)			11.35	%			10.33	%			11.35	%			10.33	%
Average asset adjustment
Average assets (GAAP)			1,708,749				1,482,341				1,691,417				1,405,297
Less: average PPP loans			161,784				135,247				158,029				67,623
Total average assets, excluding average PPP loans			1,546,965				1,347,094				1,533,388				1,337,674
Total average equity (GAAP)			175,616				141,958				173,185				140,561
Average equity / average assets, excluding average PPP loans (non-GAAP)			11.35	%			10.54	%			11.29	%			10.51	%
		For the three months ended June 30,								For the six months ended June 30,
			2021				2020				2021				2020
Return on Average Assets, adjusted
Net income (loss) (GAAP)		$	7,126			$	(634)			$	12,575			$	2,836
Less: PPP fees recognized			1,180				591				2,821				591
Less: PPP interest income earned			404				337				790				337
Net income (loss), excluding PPP income (non-GAAP)			5,542				(1,562)				8,964				1,908
Average total assets			1,708,749				1,482,341				1,691,417				1,405,297
Less: average PPP loans			161,784				135,247				158,029				67,623
Average total assets, excluding PPP (non-GAAP)			1,546,965				1,347,094				1,533,388				1,337,674
Return on average assets, excluding PPP (non-GAAP)			1.44	%			(0.47)	%			1.18	%			0.29	%
		For the three months ended June 30,								For the six months ended June 30,
			2021				2020				2021				2020
Nonperforming Assets to total assets, adjusted
Total nonperforming assets (GAAP)		$	1,158			$	4,225			$	1,158			$	4,225
Total assets (GAAP)			1,707,695				1,528,867				1,707,695				1,528,867
Less: PPP loans			124,578				171,650				124,578				171,650
Total assets, excluding PPP loans (non-GAAP)			1,583,117				1,357,217				1,583,117				1,357,217
Nonperforming assets to total assets, excluding PPP loans (non-GAAP)			0.07	%			0.31	%			0.07	%			0.31	%
		For the three months ended June 30,								For the six months ended June 30,
			2021				2020				2021				2020
Allowance for loan losses, adjusted
Allowance for loan losses (GAAP)		$	11,133			$	13,731			$	11,133			$	13,731
Total gross loans (GAAP)			1,274,478				1,280,502				1,274,478				1,280,502
Less: PPP loans			124,578				171,650				124,578				171,650
Total gross loans, excluding PPP loans (non-GAAP)			1,149,900				1,108,852				1,149,900				1,108,852
Allowance for loan losses to total loans, excluding PPP (non-GAAP)			0.97	%			1.24	%			0.97	%			1.24	%
		For the three months ended June 30,								For the six months ended June 30,
			2021				2020				2021				2020
Net charge-offs to average loans, adjusted
Total net charge-offs (recoveries) (GAAP)		$	2				1,742			$	(16)			$	1,778
Total average gross loans (GAAP)			1,302,722				1,213,250				1,311,085				1,136,885
Less: average PPP loans			161,784				135,247				158,029				67,623
Total average gross loans, excluding PPP loans (non-GAAP)			1,140,938				1,078,003				1,153,056				1,069,262
Net charge-offs (recoveries) to average gross loans, excluding PPP (annualized) (non-GAAP)			0.00	%			0.65	%			0.00	%			0.32	%

 

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/mainstreet-bancshares-inc-reports-record-second-quarter-2021-earnings-301336972.html

SOURCE MainStreet Bancshares, Inc.