METROCITY BANKSHARES, INC. REPORTS EARNINGS FOR FOURTH QUARTER AND YEAR ENDED 2022

Rhea-AI Summary

MetroCity Bankshares reported a net income of $13.2 million for Q4 2022, down 22% from Q3 and 24.5% from Q4 2021. The year-end 2022 net income was $65.6 million, a 6.3% increase year-over-year. Key metrics included a 1.54% return on average assets for Q4, a decline from 2.07% the previous quarter. The efficiency ratio worsened to 40.3% from 36.4% in Q3. Total assets rose to $3.43 billion, with total loans increasing 2.6% to $3.06 billion. However, noninterest income fell 64.8% compared to Q3 and 76.1% year-over-year, driven by lower mortgage loan fees and SBA loan gains.

Positive

• Year-end net income increased by $3.9 million, or 6.3%, to $65.6 million.
• Total loans rose by $550.6 million, or 22.0%, compared to the previous year.
• Total assets increased by $320.4 million, or 10.3%, year-over-year.

Negative

• Q4 2022 net income decreased by $3.7 million, or 22.0%, from Q3.
• Noninterest income for Q4 2022 dropped by $3.3 million, or 64.8%, from Q3.
• Q4 efficiency ratio worsened to 40.3% from 36.4% in Q3.

ATLANTA, Jan. 23, 2023 /PRNewswire/ -- MetroCity Bankshares, Inc. ("MetroCity" or the "Company") (NASDAQ: MCBS), holding company for Metro City Bank (the "Bank"), today reported net income of $13.2 million, or $0.52 per diluted share, for the fourth quarter of 2022, compared to $16.9 million, or $0.66 per diluted share, for the third quarter of 2022, and $17.4 million, or $0.68 per diluted share, for the fourth quarter of 2021. For the year ended December 21, 2022, the Company reported net income of $65.6 million, or $2.55 per diluted share, compared to $61.7 million, or $2.39 per diluted share, for the year ended December 31, 2021.

Fourth Quarter 2022 Highlights:

• Annualized return on average assets was 1.54%, compared to 2.07% for the third quarter of 2022 and 2.33% for the fourth quarter of 2021.
• Annualized return on average equity was 14.97%, compared to 20.56% for the third quarter of 2022 and 24.80% for the fourth quarter of 2021.
• Efficiency ratio of 40.3%, compared to 36.4% for the third quarter of 2022 and 33.7% for the fourth quarter of 2021.
• Total assets increased by $78.1 million, or 2.3%, to $3.43 billion from the previous quarter.
• Total loans increased by $77.4 million, or 2.6%, to $3.06 billion from the previous quarter.
• Total deposits increased by $96.0 million, or 3.7%, to $2.67 billion from the previous quarter.

Full Year 2022 Highlights:

• Return on average assets was 2.06%, compared to 2.51% for 2021.
• Return on average equity was 20.48%, compared to 23.55% for 2021.
• Efficiency ratio of 36.3%, compared to 35.1% for 2021.
• Total assets increased by $320.4 million, or 10.3%, to $3.43 billion from $3.11 billion at December 31, 2021.
• Total loans increased by $550.6 million, or 22.0%, to $3.06 billion from $2.51 billion at December 31, 2021.
• Total deposits increased by $403.8 million, or 17.8%, to $2.67 billion from $2.26 billion at December 31, 2021.

Results of Operations

Net Income

Net income was $13.2 million for the fourth quarter of 2022, a decrease of $3.7 million, or 22.0%, from $16.9 million for the third quarter of 2022. This decrease was primarily due to a decrease in net interest income of $838,000 and a decrease in noninterest income of $3.3 million, offset by a decrease in noninterest expense of $309,000 and a decrease in income tax expense of $649,000. Net income decreased by $4.3 million, or 24.5%, in the fourth quarter of 2022 compared to net income of $17.4 million for the fourth quarter of 2021. This decrease was due to a decrease in net interest income of $671,000 and a decrease in noninterest income of $5.7 million, offset by a decrease in provision for loan losses of $1.7 million, a decrease in noninterest expense of $133,000 and a decrease in provision for income taxes of $247,000.

Net income was $65.6 million for the year ended December 31, 2022, an increase of $3.9 million, or 6.3%, from $61.7 million for the year ended December 31, 2021. This increase was due to an increase in net interest income of $15.4 million and a decrease in provision for loan losses of $9.7 million, offset by a decrease in noninterest income of $14.6 million, an increase in noninterest expense of $1.9 million and an increase in provision for taxes of $4.7 million.

Net Interest Income and Net Interest Margin

Interest income totaled $43.9 million for the fourth quarter of 2022, an increase of $5.6 million, or 14.7%, from the previous quarter, primarily due to a $124.2 million increase in average loan balances coupled with a 39 basis points increase in the loan yield. As compared to the fourth quarter of 2021, interest income for the fourth quarter of 2022 increased by $13.1 million, or 42.4%, primarily due to an increase in average loan balances of $562.7 million coupled with a 57 basis points increase in the loan yield.

Interest expense totaled $15.0 million for the fourth quarter of 2022, an increase of $6.5 million, or 76.2%, from the previous quarter, primarily due to a 113 basis points increase in deposit costs and a 26 basis points increase in borrowing costs coupled with a $118.7 million increase in average interest-bearing deposits and a $27.7 million increase in average borrowings. As compared to the fourth quarter of 2021, interest expense for the fourth quarter of 2022 increased by $13.8 million, or 1,113.2%, due to a 234 basis points increase in deposit costs and a 175 basis points increase in borrowing costs coupled with a $419.1 million increase in average interest-bearing deposits.

The net interest margin for the fourth quarter of 2022 was 3.58% compared to 3.84% for the previous quarter, a decrease of 26 basis points. The yield on average interest-earning assets for the fourth quarter of 2022 increased by 49 basis points to 5.43% from 4.94% for the previous quarter, while the cost of average interest-bearing liabilities for the fourth quarter of 2022 increased by 98 basis points to 2.49% from 1.51% for the previous quarter. Average earning assets increased by $130.9 million from the previous quarter, primarily due to an increase in average loans of $124.2 million and an increase in average total investments of $6.7 million. Average interest-bearing liabilities increased by $146.4 million from the previous quarter as average interest-bearing deposits increased by $118.7 million and average borrowings increased by $27.7 million.

As compared to the same period in 2021, the net interest margin for the fourth quarter of 2022 decreased by 57 basis points to 3.58% from 4.15%, primarily due to a 225 basis point increase in the cost of average interest-bearing liabilities of $2.39 billion, offset by a 111 basis point increase in the yield on average interest-earning assets of $3.21 billion. Average earning assets for the fourth quarter of 2022 increased by $376.5 million from the fourth quarter of 2021, primarily due to a $562.7 million increase in average loans, offset by a $186.0 million decrease in average interest-earning cash accounts. Average interest-bearing liabilities for the fourth quarter of 2022 increased by $357.1 million from the fourth quarter of 2021, driven by an increase in average interest-bearing deposits of $419.1 million, offset by a decrease in average borrowings of $62.0 million.

Noninterest Income

Noninterest income for the fourth quarter of 2022 was $1.8 million, a decrease of $3.3 million, or 64.8%, from the third quarter of 2022, primarily due to lower mortgage loan fees, lower gains on sale of Small Business Administration ("SBA") loans and a significant decrease in SBA servicing income. Mortgage loan originations totaled $88.0 million during the fourth quarter 2022 compared to $255.7 million during the third quarter of 2022. During the fourth quarter of 2022, we recorded a $1.2 million fair value adjustment charge on our SBA servicing asset which had a $0.04 per share impact on our diluted earnings per share for the quarter.

Compared to the same period in 2021, noninterest income for the fourth quarter of 2022 decreased by $5.7 million, or 76.1%, primarily due to much lower gains on sale of SBA loans, mortgage loan fees and mortgage and SBA servicing income.

Noninterest income for the year ended December 31, 2022 totaled $19.2 million, a decrease of $14.6 million, or 43.2%, from the year ended December 31, 2021, primarily due to lower mortgage loan fees from lower volume, gains on sale of SBA loans and SBA servicing income, offset by increases in gains on sale of mortgage loans, service charges on deposit accounts and other income. Beginning in the second quarter of 2022, we elected to stop selling the guaranteed portion of our SBA loans since the sales premiums offered by third party investors had significantly declined compared to prior year. As of December 31, 2022, approximately $137.8 million of the $299.3 million of SBA loan balances outstanding on our books had SBA guarantees. During the year ended December 31, 2022, we also recorded a $3.1 million fair value adjustment charge on our SBA servicing asset compared to a $619,000 fair value gain during the year ended December 31, 2021. Mortgage loan originations totaled $833.6 million during the year ended December 31, 2022 compared to $1.20 billion during the year ended December 31, 2021. Mortgage loan sales totaled $94.9 million during the year ended December 31, 2022 compared to no mortgage loan sales during the year ended December 31, 2021.

Noninterest Expense

Noninterest expense for the fourth quarter of 2022 totaled $12.4 million, a decrease of $309,000, or 2.4%, from $12.7 million for the third quarter of 2022. This decrease was primarily attributable to lower commissions from lower loan volume and lower loan and other real estate owned related expenses, partially offset by higher employee salaries and benefits. Compared to the fourth quarter of 2021, noninterest expense during the fourth quarter of 2022 decreased by $133,000, or 1.1%, primarily due to lower commissions, FDIC deposit insurance premiums, and loan related expenses, partially offset by higher employee salaries and benefits.

Noninterest expense for the year ended December 31, 2022 totaled $50.4 million, an increase of $1.9 million, or 4.0%, from $48.4 million for the year ended December 31, 2021. This increase was primarily attributable to higher employee salaries and benefits, FDIC deposit insurance premiums, professional fees, communication expenses and fair value losses on our equity investments, offset by lower commissions due to lower loan volume, occupancy and equipment expenses, and loan and other real estate owned related expenses.

The Company's efficiency ratio was 40.3% for the fourth quarter of 2022 compared to 36.4% and 33.7% for the third quarter of 2022 and fourth quarter of 2021, respectively. For the year ended December 31, 2022, the efficiency ratio was 36.3% compared with 35.1% for the year ended December 31, 2021.

Income Tax Expense

The Company's effective tax rate for the fourth quarter of 2022 was 32.6%, compared to 29.3% for the third quarter of 2022 and 27.5% for the fourth quarter of 2021. The effective tax rate for the year ended December 31, 2022 was 28.1% compared to 25.3% for the year ended December 31, 2021. The elevated effective tax rate during the fourth quarter of 2022, as well as the year ended December 31, 2022, was due to the re-allocation of state income tax apportionment schedules for prior year's tax returns.

Balance Sheet

Total Assets

Total assets were $3.43 billion at December 31, 2022, an increase of $78.1 million, or 2.3%, from $3.35 billion at September 30, 2022, and an increase of $320.4 million, or 10.3%, from $3.11 billion at December 31, 2021. The $78.1 million increase in total assets at December 31, 2022 compared to September 30, 2022 was primarily due to increases in loans of $77.4 million and federal funds sold of $12.9 million, partially offset by a decrease in cash and due from banks of $13.1 million. The $320.4 million increase in total assets at December 31, 2022 compared to December 31, 2021 was primarily due to increases in loans of $550.6 million, federal funds sold of $19.7 million, bank owned life insurance of $9.7 million and other assets of $32.4 million, partially offset by a $281.6 million decrease in cash and due from banks. 

Loans

Loans held for investment were $3.06 billion at December 31, 2022, an increase of $77.4 million, or 2.6%, compared to $2.98 billion at September 30, 2022, and an increase of $550.6 million, or 22.0%, compared to $2.51 billion at December 31, 2021. The increase in loans at December 31, 2022 compared to September 30, 2022 was primarily due to a $48.6 million increase in commercial real estate loans, a $32.2 million increase in residential mortgages and a $480,000 increase in commercial and industrial loans, offset by a $3.5 million decrease in construction and development loans. Included in commercial and industrial loans are PPP loans totaling $713,000 as of December 31, 2022. PPP loans totaled $1.6 million as of September 30, 2022 and $31.0 million as of December 31, 2021. There were no loans classified as held for sale at December 31, 2022, September 30, 2022 or December 31, 2021.

Deposits

Total deposits were $2.67 billion at December 31, 2022, an increase of $96.0 million, or 3.7%, compared to total deposits of $2.57 billion at September 30, 2022, and an increase of $403.8 million, or 17.8%, compared to total deposits of $2.26 billion at December 31, 2021. The increase in total deposits at December 31, 2022 compared to September 30, 2022 was due to a $203.5 million increase in time deposits, a $22.3 million increase in interest-bearing demand deposits and a $9.7 million increase in noninterest-bearing deposits, offset by a $136.4 million decrease in money market accounts and a $3.2 million decrease in savings accounts.

Noninterest-bearing deposits were $612.0 million at December 31, 2022, compared to $602.2 million at September 30, 2022 and $592.4 million at December 31, 2021. Noninterest-bearing deposits constituted 22.9% of total deposits at December 31, 2022, compared to 23.4% at September 30, 2022 and 26.2% at December 31, 2021. Interest-bearing deposits were $2.05 billion at December 31, 2022, compared to $1.97 billion at September 30, 2022 and $1.67 billion at December 31, 2021. Interest-bearing deposits constituted 77.1% of total deposits at December 31, 2022, compared to 76.6% at September 30, 2022 and 73.8% at December 31, 2021.

Asset Quality

The Company recorded a credit provision for loan losses of $1.2 million during the fourth quarter of 2022, compared to a $1.7 million credit provision recorded during the third quarter of 2022 and a $546,000 provision expense recorded during the fourth quarter of 2021. The credit provision recorded during the fourth quarter of 2022 was due to the continued release of additional reserves allocated for the uncertainties in our loan portfolio caused by the ongoing COVID-19 pandemic. Annualized net charge-offs to average loans for the fourth quarter of 2022 was a net recovery of 0.01%, compared 0.00% for the third quarter of 2022 and net charge-offs of 0.01% for the fourth quarter of 2021. The Company implemented the provisions of the current expected credit losses accounting standard issued by the Financial Accounting Standards Board in the Accounting Standards Update No. 2016-13 on January 1, 2023. The allowance for loan losses was accounted for under the incurred loss model as of December 31, 2022.

Nonperforming assets totaled $24.5 million, or 0.71% of total assets, at December 31, 2022, a decrease of $8.0 million from $32.5 million, or 0.97% of total assets, at September 30, 2022, and an increase of $9.1 million from $15.4 million, or 0.50% of total assets, at December 31, 2021. The decrease in nonperforming assets at December 31, 2022 compared to September 30, 2022 was due to a $7.6 million decrease in nonaccrual loans and a $518,000 decrease in accruing troubled debt restructurings, offset by a $180,000 increase in loans past due ninety days and still accruing.

Allowance for loan losses as a percentage of total loans was 0.45% at December 31, 2022, compared to 0.50% at September 30, 2022 and 0.67% at December 31, 2021. Allowance for loan losses as a percentage of nonperforming loans was 68.88% at December 31, 2022, compared to 53.25% and 143.69% at September 30, 2022 and December 31, 2021, respectively.

About MetroCity Bankshares, Inc.

MetroCity Bankshares, Inc. is a Georgia corporation and a registered bank holding company for its wholly-owned banking subsidiary, Metro City Bank, which is headquartered in the Atlanta, Georgia metropolitan area. Founded in 2006, Metro City Bank currently operates 19 full-service branch locations in multi-ethnic communities in Alabama, Florida, Georgia, New York, New Jersey, Texas and Virginia. To learn more about Metro City Bank, visit www.metrocitybank.bank.

Forward-Looking Statements

Statements in this press release regarding future events and our expectations and beliefs about our future financial performance and financial condition, as well as trends in our business and markets, constitute "forward-looking statements" within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are not historical in nature and may be identified by references to a future period or periods by the use of the words "believe," "expect," "anticipate," "intend," "plan," "estimate," "project," "outlook," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." The forward-looking statements in this press release should not be relied on because they are based on current information and on assumptions that we make about future events and circumstances that are subject to a number of known and unknown risks and uncertainties that are often difficult to predict and beyond our control. As a result of those risks and uncertainties, and other factors, our actual financial results in the future could differ, possibly materially, from those expressed in or implied by the forward-looking statements contained in this press release and could cause us to make changes to our future plans. Factors that might cause such differences include, but are not limited to: the impact of current and future economic conditions, particularly those affecting the financial services industry, including the effects of declines in the real estate market, high unemployment rates, inflationary pressures, elevated interest rates and slowdowns in economic growth, as well as the financial stress on borrowers as a result of the foregoing; the impact of the ongoing COVID-19 pandemic and related variants on the Company's assets, business, cash flows, financial condition, liquidity, prospects and results of operations; changes in the interest rate environment, including changes to the federal funds rate; changes in prices, values and sales volumes of residential and commercial real estate; developments in our mortgage banking business, including loan modifications, general demand, and the effects of judicial or regulatory requirements or guidance; competition in our markets that may result in increased funding costs or reduced earning assets yields, thus reducing margins and net interest income; interest rate fluctuations, which could have an adverse effect on the Company's profitability; legislation or regulatory changes which could adversely affect the ability of the consolidated Company to conduct business combinations or new operations; changes in tax laws; significant turbulence or a disruption in the capital or financial markets and the effect of a fall in stock market prices on our investment securities; the effects of war or other conflicts including the impacts related to or resulting from Russia's military action in Ukraine; and adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions, including as a result of the Company's participation in and execution of government programs related to the ongoing COVID-19 pandemic and related variants. Therefore, the Company can give no assurance that the results contemplated in the forward-looking statements will be realized. Additional information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained in the sections titled "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors" in the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q on file with the U.S. Securities and Exchange Commission (the "SEC"), and in other documents that we file with the SEC from time to time, which are available on the SEC's website, http://www.sec.gov. In addition, our actual financial results in the future may differ from those currently expected due to additional risks and uncertainties of which we are not currently aware or which we do not currently view as, but in the future may become, material to our business or operating results. Due to these and other possible uncertainties and risks, readers are cautioned not to place undue reliance on the forward-looking statements contained in this press release or to make predictions based solely on historical financial performance. Any forward-looking statement speaks only as of the date on which it is made, and we do not undertake any obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. All forward-looking statements, express or implied, included in this press release are qualified in their entirety by this cautionary statement.

Contacts
Farid Tan	Lucas Stewart
President	Chief Financial Officer
770-455-4978	678-580-6414
faridtan@metrocitybank.bank	lucasstewart@metrocitybank.bank

 

 

METROCITY BANKSHARES, INC. SELECTED FINANCIAL DATA
		As of and for the Three Months Ended															As of and for the Year Ended
		December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
(Dollars in thousands, except per share data)		2022			2022			2022			2022			2021			2022			2021
Selected income statement data:
Interest income		$	43,945		$	38,297		$	33,025		$	31,953		$	30,857		$	147,220		$	108,741
Interest expense			14,995			8,509			2,805			1,300			1,236			27,609			4,572
Net interest income			28,950			29,788			30,220			30,653			29,621			119,611			104,169
Provision for loan losses			(1,168)			(1,703)			—			104			546			(2,767)			6,929
Noninterest income			1,794			5,101			4,653			7,656			7,491			19,204			33,803
Noninterest expense			12,379			12,688			13,119			12,179			12,512			50,365			48,424
Income tax expense			6,392			7,011			5,654			6,597			6,609			25,624			20,918
Net income			13,171			16,893			16,100			19,429			17,445			65,593			61,701
Per share data:
Basic income per share		$	0.52		$	0.66		$	0.63		$	0.76		$	0.69		$	2.58		$	2.41
Diluted income per share		$	0.52		$	0.66		$	0.63		$	0.76		$	0.68		$	2.55		$	2.39
Dividends per share		$	0.15		$	0.15		$	0.15		$	0.15		$	0.14		$	0.60		$	0.46
Book value per share (at period end)		$	14.00		$	13.76		$	12.69		$	12.19		$	11.40		$	14.00		$	11.40
Shares of common stock outstanding			25,169,709			25,370,417			25,451,125			25,465,236			25,465,236			25,169,709			25,465,236
Weighted average diluted shares			25,560,138			25,702,023			25,729,156			25,719,035			25,720,128			25,688,969			25,788,781
Performance ratios:
Return on average assets			1.54	%		2.07	%		2.16	%		2.52	%		2.33	%		2.06	%		2.51	%
Return on average equity			14.97			20.56			20.65			26.94			24.80			20.48			23.55
Dividend payout ratio			29.03			22.75			23.85			19.76			20.52			23.40			19.17
Yield on total loans			5.50			5.11			4.95			5.00			4.93			5.15			5.11
Yield on average earning assets			5.43			4.94			4.65			4.34			4.32			4.86			4.65
Cost of average interest bearing liabilities			2.49			1.51			0.56			0.24			0.24			1.25			0.29
Cost of deposits			2.61			1.48			0.55			0.27			0.27			1.29			0.29
Net interest margin			3.58			3.84			4.26			4.16			4.15			3.95			4.45
Efficiency ratio(1)			40.26			36.37			37.62			31.79			33.71			36.28			35.10
Asset quality data (at period end):
Net charge-offs/(recoveries) to average loans held for investment			(0.01)	%		0.00	%		0.00	%		0.06	%		0.01	%		0.01	%		0.01	%
Nonperforming assets to gross loans and OREO			0.80			1.09			1.22			0.63			0.61			0.80			0.61
ALL to nonperforming loans			68.88			53.25			54.79			134.39			143.69			68.88			143.69
ALL to loans held for investment			0.45			0.50			0.60			0.66			0.67			0.45			0.67
Balance sheet and capital ratios:
Gross loans held for investment to deposits			114.94	%		116.21	%		115.86	%		105.72	%		110.98	%		114.94	%		110.98	%
Noninterest bearing deposits to deposits			22.95			23.43			25.87			25.84			26.18			22.95			26.18
Common equity to assets			10.28			10.42			10.20			9.88			9.34			10.28			9.34
Leverage ratio			9.66			9.90			10.31			9.46			9.44			9.66			9.44
Common equity tier 1 ratio			16.11			16.18			16.70			17.24			16.76			16.11			16.76
Tier 1 risk-based capital ratio			16.11			16.18			16.70			17.24			16.76			16.11			16.76
Total risk-based capital ratio			16.79			16.94			17.60			18.22			17.77			16.79			17.77
Mortgage and SBA loan data:
Mortgage loans serviced for others		$	526,719		$	550,587		$	589,500		$	605,112		$	608,208		$	526,719		$	608,208
Mortgage loan production			88,045			255,662			326,973			162,933			237,195			833,613			1,196,190
Mortgage loan sales			—			—			37,928			56,987			—			94,915			—
SBA loans serviced for others			465,120			489,120			504,894			528,227			542,991			465,120			542,991
SBA loan production			42,419			22,193			21,407			50,689			52,727			136,708			285,834
SBA loan sales			—			8,588			—			22,898			30,169			31,486			124,710

(1)	Represents noninterest expense divided by the sum of net interest income plus noninterest income.

 

METROCITY BANKSHARES, INC. CONSOLIDATED BALANCE SHEETS (UNAUDITED)
		As of the Quarter Ended
		December 31,			September 30,			June 30,			March 31,			December 31,
(Dollars in thousands, except per share data)		2022			2022			2022			2022			2021
ASSETS
Cash and due from banks		$	150,964		$	164,054		$	220,027		$	418,988		$	432,523
Federal funds sold			28,521			15,669			3,069			5,743			8,818
Cash and cash equivalents			179,485			179,723			223,096			424,731			441,341
Equity securities			10,300			10,452			10,778			11,024			11,386
Securities available for sale (at fair value)			19,245			19,978			21,394			23,886			25,733
Loans			3,055,689			2,978,318			2,770,020			2,512,300			2,505,070
Allowance for loan losses			(13,888)			(14,982)			(16,678)			(16,674)			(16,952)
Loans less allowance for loan losses			3,041,801			2,963,336			2,753,342			2,495,626			2,488,118
Loans held for sale			—			—			—			37,928			—
Accrued interest receivable			13,171			11,732			10,990			10,644			11,052
Federal Home Loan Bank stock			17,493			15,619			15,619			15,806			19,701
Premises and equipment, net			14,257			13,664			12,847			12,814			13,068
Operating lease right-of-use asset			8,463			8,835			8,518			8,925			9,338
Foreclosed real estate, net			4,328			4,328			3,562			3,562			3,618
SBA servicing asset, net			7,085			8,324			8,216			10,554			10,234
Mortgage servicing asset, net			3,973			4,975			6,090			6,925			7,747
Bank owned life insurance			69,130			68,697			68,267			67,841			59,437
Other assets			37,826			38,776			25,131			12,051			5,385
Total assets		$	3,426,557		$	3,348,439		$	3,167,850		$	3,142,317		$	3,106,158
LIABILITIES
Noninterest-bearing deposits		$	611,991		$	602,246		$	620,182		$	615,650		$	592,444
Interest-bearing deposits			2,054,847			1,968,607			1,776,826			1,766,491			1,670,576
Total deposits			2,666,838			2,570,853			2,397,008			2,382,141			2,263,020
Federal Home Loan Bank advances			375,000			375,000			375,000			380,000			500,000
Other borrowings			392			396			399			405			459
Operating lease liability			8,885			9,303			9,031			9,445			9,861
Accrued interest payable			2,739			1,489			703			207			204
Other liabilities			20,291			42,369			62,640			59,709			42,391
Total liabilities		$	3,074,145		$	2,999,410		$	2,844,781		$	2,831,907		$	2,815,935
SHAREHOLDERS' EQUITY
Preferred stock			—			—			—			—			—
Common stock			252			254			255			255			255
Additional paid-in capital			45,298			48,914			49,831			51,753			51,559
Retained earnings			288,823			279,475			266,426			254,165			238,577
Accumulated other comprehensive income (loss)			18,039			20,386			6,557			4,237			(168)
Total shareholders' equity			352,412			349,029			323,069			310,410			290,223
Total liabilities and shareholders' equity		$	3,426,557		$	3,348,439		$	3,167,850		$	3,142,317		$	3,106,158

 

METROCITY BANKSHARES, INC. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
		Three Months Ended															Year Ended
		December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
(Dollars in thousands, except per share data)		2022			2022			2022			2022			2021			2022			2021
Interest and dividend income:
Loans, including Fees		$	41,783		$	37,263		$	32,310		$	31,459		$	30,496		$	142,815		$	107,851
Other investment income			2,116			1,011			711			492			360			4,330			885
Federal funds sold			46			23			4			2			1			75			5
Total interest income			43,945			38,297			33,025			31,953			30,857			147,220			108,741
Interest expense:
Deposits			13,071			6,964			2,384			1,139			1,069			23,558			3,948
FHLB advances and other borrowings			1,924			1,545			421			161			167			4,051			624
Total interest expense			14,995			8,509			2,805			1,300			1,236			27,609			4,572
Net interest income			28,950			29,788			30,220			30,653			29,621			119,611			104,169
Provision for loan losses			(1,168)			(1,703)			—			104			546			(2,767)			6,929
Net interest income after provision for loan losses			30,118			31,491			30,220			30,549			29,075			122,378			97,240
Noninterest income:
Service charges on deposit accounts			483			509			518			481			466			1,991			1,696
Other service charges, commissions and fees			1,243			2,676			3,647			2,159			3,015			9,725			14,437
Gain on sale of residential mortgage loans			—			—			806			1,211			—			2,017			—
Mortgage servicing income, net			(299)			(358)			(5)			101			95			(561)			(564)
Gain on sale of SBA loans			—			500			—			1,568			2,895			2,068			10,952
SBA servicing income, net			(72)			1,330			(1,077)			1,644			634			1,825			5,884
Other income			439			444			764			492			386			2,139			1,398
Total noninterest income			1,794			5,101			4,653			7,656			7,491			19,204			33,803
Noninterest expense:
Salaries and employee benefits			7,721			7,756			7,929			7,096			7,819			30,502			30,112
Occupancy			1,263			1,167			1,200			1,227			1,206			4,857			5,028
Data Processing			287			270			261			277			252			1,095			1,100
Advertising			172			158			126			150			148			606			541
Other expenses			2,936			3,337			3,603			3,429			3,087			13,305			11,643
Total noninterest expense			12,379			12,688			13,119			12,179			12,512			50,365			48,424
Income before provision for income taxes			19,533			23,904			21,754			26,026			24,054			91,217			82,619
Provision for income taxes			6,362			7,011			5,654			6,597			6,609			25,624			20,918
Net income available to common shareholders		$	13,171		$	16,893		$	16,100		$	19,429		$	17,445		$	65,593		$	61,701

 

METROCITY BANKSHARES, INC. AVERAGE BALANCES AND YIELDS/RATES
		Three Months Ended
		December 31, 2022								September 30, 2022								December 31, 2021
		Average			Interest and			Yield /		Average			Interest and			Yield /		Average			Interest and			Yield /
(Dollars in thousands)		Balance			Fees			Rate		Balance			Fees			Rate		Balance			Fees			Rate
Earning Assets:
Federal funds sold and other investments(1)		$	159,297		$	1,777		4.43	%	$	151,177		$	864		2.27	%	$	345,311		$	221		0.25	%
Investment securities			33,405			385		4.57			34,792			170		1.94			33,682			140		1.65
Total investments			192,702			2,162		4.45			185,969			1,034		2.21			378,993			361		0.38
Construction and development			40,244			575		5.67			38,636			530		5.44			50,142			639		5.06
Commercial real estate			628,641			12,387		7.82			601,370			9,905		6.53			524,770			7,680		5.81
Commercial and industrial			51,788			1,021		7.82			50,605			909		7.13			77,911			1,353		6.89
Residential real estate			2,295,309			27,773		4.80			2,201,186			25,885		4.67			1,800,390			20,804		4.58
Consumer and other			162			27		66.12			137			34		98.46			189			20		41.98
Gross loans(2)			3,016,144			41,783		5.50			2,891,934			37,263		5.11			2,453,402			30,496		4.93
Total earning assets			3,208,846			43,945		5.43			3,077,903			38,297		4.94			2,832,395			30,857		4.32
Noninterest-earning assets			177,040								158,579								140,594
Total assets			3,385,886								3,236,482								2,972,989
Interest-bearing liabilities:
NOW and savings deposits			173,214			531		1.22			186,459			338		0.72			136,102			64		0.19
Money market deposits			1,089,198			8,361		3.05			1,179,954			5,189		1.74			949,148			550		0.23
Time deposits			722,285			4,179		2.30			499,577			1,437		1.14			480,303			455		0.38
Total interest-bearing deposits			1,984,697			13,071		2.61			1,865,990			6,964		1.48			1,565,553			1,069		0.27
Borrowings			403,113			1,924		1.89			375,405			1,545		1.63			465,141			167		0.14
Total interest-bearing liabilities			2,387,810			14,995		2.49			2,241,395			8,509		1.51			2,030,694			1,236		0.24
Noninterest-bearing liabilities:
Noninterest-bearing deposits			597,250								599,902								592,300
Other noninterest-bearing liabilities			51,692								69,131								70,915
Total noninterest-bearing liabilities			648,942								669,033								663,215
Shareholders' equity			349,134								326,054								279,080
Total liabilities and shareholders' equity		$	3,385,886							$	3,236,482							$	2,972,989
Net interest income					$	28,950							$	29,788							$	29,621
Net interest spread								2.94								3.43								4.08
Net interest margin								3.58								3.84								4.15

(1)	Includes income and average balances for term federal funds sold, interest-earning cash accounts and other miscellaneous interest-earning assets.
(2)	Average loan balances include nonaccrual loans and loans held for sale.

 

METROCITY BANKSHARES, INC. AVERAGE BALANCES AND YIELDS/RATES
		Year Ended
		December 31, 2022								December 31, 2021
		Average			Interest and			Yield /		Average			Interest and			Yield /
(Dollars in thousands)		Balance			Fees			Rate		Balance			Fees			Rate
Earning Assets:
Federal funds sold and other investments(1)		$	225,154		$	3,524		1.57	%	$	207,771		$	480		0.23	%
Investment securities			35,188			881		2.50			21,573			410		1.90
Total investments			260,342			4,405		1.69			229,344			890		0.39
Construction and development			35,562			1,898		5.34			48,076			2,513		5.23
Commercial real estate			589,017			38,582		6.55			503,968			29,750		5.90
Commercial and industrial			55,516			3,920		7.06			119,640			8,407		7.03
Residential real estate			2,090,389			98,277		4.70			1,437,377			67,058		4.67
Consumer and other			193			138		71.50			188			123		65.43
Gross loans(2)			2,770,677			142,815		5.15			2,109,249			107,851		5.11
Total earning assets			3,031,019			147,220		4.86			2,338,593			108,741		4.65
Noninterest-earning assets			156,185								122,038
Total assets			3,187,204								2,460,631
Interest-bearing liabilities:
NOW and savings deposits			186,061			1,046		0.56			112,943			222		0.20
Money market deposits			1,130,439			16,067		1.42			726,268			1,693		0.23
Time deposits			513,867			6,445		1.25			499,856			2,033		0.41
Total interest-bearing deposits			1,830,367			23,558		1.29			1,339,067			3,948		0.29
Borrowings			373,238			4,051		1.09			223,027			624		0.28
Total interest-bearing liabilities			2,203,605			27,609		1.25			1,562,094			4,572		0.29
Noninterest-bearing liabilities:
Noninterest-bearing deposits			599,340								559,797
Other noninterest-bearing liabilities			63,997								76,727
Total noninterest-bearing liabilities			663,337								636,524
Shareholders' equity			320,262								262,013
Total liabilities and shareholders' equity		$	3,187,204							$	2,460,631
Net interest income					$	119,611							$	104,169
Net interest spread								3.61								4.36
Net interest margin								3.95								4.45

(1)	Includes income and average balances for term federal funds sold, interest-earning cash accounts and other miscellaneous interest-earning assets.
(2)	Average loan balances include nonaccrual loans and loans held for sale.

 

METROCITY BANKSHARES, INC. LOAN DATA
		As of the Quarter Ended
		December 31, 2022					September 30, 2022					June 30, 2022					March 31, 2022					December 31, 2021
					% of					% of					% of					% of					% of
(Dollars in thousands)		Amount			Total		Amount			Total		Amount			Total		Amount			Total		Amount			Total
Construction and Development		$	47,779		1.6	%	$	51,300		1.7	%	$	45,042		1.6	%	$	38,683		1.6	%	$	38,857		1.6	%
Commercial Real Estate			657,246		21.4			608,700		20.4			581,234		20.9			567,031		22.5			520,488		20.7
Commercial and Industrial			53,173		1.7			52,693		1.8			57,843		2.1			66,073		2.6			73,072		2.9
Residential Real Estate			2,306,915		75.3			2,274,679		76.1			2,092,952		75.4			1,846,434		73.3			1,879,012		74.8
Consumer and other			216		—			198		—			165		—			130		—			79		—
Gross loans		$	3,065,329		100.0	%	$	2,987,570		100.0	%	$	2,777,236		100.0	%	$	2,518,351		100.0	%	$	2,511,508		100.0	%
Unearned income			(9,640)					(9,252)					(7,216)					(6,051)					(6,438)
Allowance for loan losses			(13,888)					(14,982)					(16,678)					(16,674)					(16,952)
Net loans		$	3,041,801				$	2,963,336				$	2,753,342				$	2,495,626				$	2,488,118

 

METROCITY BANKSHARES, INC. NONPERFORMING ASSETS
		As of the Quarter Ended
		December 31,			September 30,			June 30,			March 31,			December 31,
(Dollars in thousands)		2022			2022			2022			2022			2021
Nonaccrual loans		$	10,065		$	17,700		$	19,966		$	9,506		$	8,759
Past due loans 90 days or more and still accruing			180			—			—			—			342
Accruing troubled debt restructured loans			9,919			10,437			10,474			2,901			2,697
Total non-performing loans			20,164			28,137			30,440			12,407			11,798
Other real estate owned			4,328			4,328			3,562			3,562			3,618
Total non-performing assets		$	24,492		$	32,465		$	34,002		$	15,969		$	15,416
Nonperforming loans to gross loans			0.66	%		0.94	%		1.10	%		0.49	%		0.47	%
Nonperforming assets to total assets			0.71			0.97			1.07			0.51			0.50
Allowance for loan losses to non-performing loans			68.88			53.25			54.79			134.39			143.69

 

METROCITY BANKSHARES, INC. ALLOWANCE FOR LOAN LOSSES
		As of and for the Three Months Ended															As of and for the Year Ended
		December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
(Dollars in thousands)		2022			2022			2022			2022			2021			2022			2021
Balance, beginning of period		$	14,982		$	16,678		$	16,674		$	16,952		$	16,445		$	16,952		$	10,135
Net charge-offs/(recoveries):
Construction and development			—			—			—			—			—			—			—
Commercial real estate			(2)			(1)			(2)			(2)			39			(7)			55
Commercial and industrial			(72)			(6)			(2)			389			—			309			64
Residential real estate			—			—			—			—			—			—			—
Consumer and other			—			—			—			(5)			—			(5)			(7)
Total net charge-offs/(recoveries)			(74)			(7)			(4)			382			39			297			112
Provision for loan losses			(1,168)			(1,703)			—			104			546			(2,767)			6,929
Balance, end of period		$	13,888		$	14,982		$	16,678		$	16,674		$	16,952		$	13,888		$	16,952
Total loans at end of period		$	3,065,329		$	2,987,570		$	2,777,236		$	2,518,351		$	2,511,508		$	3,065,329		$	2,511,508
Average loans(1)		$	3,016,144		$	2,891,934		$	2,597,019		$	2,533,254		$	2,453,402		$	2,761,195		$	2,109,249
Net charge-offs/(recoveries) to average loans			(0.01)	%		0.00	%		0.00	%		0.06	%		0.01	%		0.01	%		0.01	%
Allowance for loan losses to total loans			0.45			0.50			0.60			0.66			0.67			0.45			0.67

(1)	Excludes loans held for sale

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SOURCE MetroCity Bankshares, Inc.

FAQ

What is MetroCity Bankshares' net income for Q4 2022?

MetroCity Bankshares reported a net income of $13.2 million for Q4 2022.

How did MetroCity Bankshares perform financially in 2022?

For the year ended December 31, 2022, the company reported a net income of $65.6 million.

What was the total assets of MetroCity Bankshares at the end of 2022?

Total assets were $3.43 billion at December 31, 2022.

What was the change in MetroCity Bankshares' loans in 2022?

Total loans increased by $550.6 million, or 22.0%, from December 31, 2021.

What was the efficiency ratio for MetroCity Bankshares in Q4 2022?

The efficiency ratio for Q4 2022 was 40.3%.