METROCITY BANKSHARES, INC. REPORTS EARNINGS FOR THIRD QUARTER 2022

Rhea-AI Summary

MetroCity reported a net income of $16.9 million, or $0.66 per diluted share, for Q3 2022, up from $16.1 million in Q2 2022. Year-to-date, net income reached $52.4 million, a 18.7% increase from $44.3 million in 2021. Total assets grew 5.7% this quarter to $3.35 billion, with loans increasing 7.5% to $2.98 billion. However, the efficiency ratio worsened to 36.4% from 34.8% last year, while the annualized return on equity and assets decreased.

Positive

• Net income rose to $16.9 million, a 4.9% increase from Q2 2022.
• Total assets increased by $180.6 million, or 5.7%, to $3.35 billion.
• Total loans grew by $208.3 million, or 7.5%, to $2.98 billion.
• Noninterest income increased by $448,000, or 9.6%, from Q2 2022.

Negative

• Net interest margin decreased to 3.84% from 4.26% in Q2 2022.
• Annualized return on average assets declined to 2.07% from 2.16% in Q2 2022.
• Noninterest income decreased by $4.4 million, or 46.5%, compared to Q3 2021.
• Effective tax rate rose significantly to 29.3% from 26.0% in Q2 2022.

ATLANTA, Oct. 21, 2022 /PRNewswire/ -- MetroCity Bankshares, Inc. ("MetroCity" or the "Company") (NASDAQ: MCBS), holding company for Metro City Bank (the "Bank"), today reported net income of $16.9 million, or $0.66 per diluted share, for the third quarter of 2022, compared to $16.1 million, or $0.63 per diluted share, for the second quarter of 2022, and $16.9 million, or $0.66 per diluted share, for the third quarter of 2021. For the nine months ended September 30, 2022, the Company reported net income of $52.4 million, or $2.04 per diluted share, compared to $44.3 million, or $1.71 per diluted share, for the same period in 2021.

Third Quarter 2022 Highlights:

• Annualized return on average assets was 2.07%, compared to 2.16% for the second quarter of 2022 and 2.61% for the third quarter of 2021.
• Annualized return on average equity was 20.56%, compared to 20.65% for the second quarter of 2022 and 25.23% for the third quarter of 2021.
• Efficiency ratio of 36.4%, compared to 37.6% for the second quarter of 2022 and 34.8% for the third quarter of 2021.
• Total assets increased by $180.6 million, or 5.7%, to $3.35 billion from the previous quarter.
• Total loans increased by $208.3 million, or 7.5%, to $2.98 billion from the previous quarter.
• Total deposits increased by $173.8 million, or 7.3%, to $2.57 billion from the previous quarter
• Annualized net charge-off to average loans for the quarter was 0.00%, compared to 0.00% for both the second quarter of 2022 and the third quarter of 2021.

Results of Operations

Net Income

Net income was $16.9 million for the third quarter of 2022, an increase of $793,000, or 4.9%, from $16.1 million for the second quarter of 2022. This increase was primarily due to a $1.7 million credit provision for loan losses recorded during the quarter, an increase in noninterest income of $448,000, and a decrease in noninterest expense of $431,000, offset by a decrease in net interest income of $432,000 and an increase in income tax expense of $1.4 million. Net income increased by $11,000, or 0.1%, in the third quarter of 2022 compared to net income of $16.9 million for the third quarter of 2021. This slight increase was due to an increase in net interest income of $1.6 million, a decrease in provision for loan losses of $4.3 million and a decrease in noninterest expense of $423,000, offset by a decrease in noninterest income of $4.4 million and an increase in provision for income taxes of $1.9 million.

Net Interest Income and Net Interest Margin

Interest income totaled $38.3 million for the third quarter of 2022, an increase of $5.3 million, or 16.0%, from the previous quarter, primarily due to a $276.0 million increase in average loan balances. We recognized Paycheck Protection Program ("PPP") loan fee income of $145,000 during the third quarter of 2022 compared to $341,000 recognized during the second quarter of 2022. As compared to the third quarter of 2021, interest income for the third quarter of 2022 increased by $9.0 million, or 30.6%, primarily due to an increase in average loan balances of $650.7 million.

Interest expense totaled $8.5 million for the third quarter of 2022, an increase of $5.7 million, or 203.4%, from the previous quarter, primarily due to a 93 basis points increase in deposit costs and a 95 basis points increase in borrowing costs coupled with a $112.8 million increase in average interest-bearing deposits and a $128.6 million increase in average borrowings. As compared to the third quarter of 2021, interest expense for the third quarter of 2022 increased by $7.4 million, or 649.7%, due to a 120 basis points increase in deposit costs and a 135 basis points increase in borrowing costs coupled with a $486.5 million increase in average interest-bearing deposits and a $134.7 million increase in average borrowings.

The net interest margin for the third quarter of 2022 was 3.84% compared to 4.26% for the previous quarter, a decrease of 42 basis points. The yield on average interest-earning assets for the third quarter of 2022 increased by 29 basis points to 4.94% from 4.65% for the previous quarter, while the cost of average interest-bearing liabilities for the third quarter of 2022 increased by 95 basis points to 1.51% from 0.56% for the previous quarter. Average earning assets increased by $232.2 million from the previous quarter, primarily due to an increase in average loans of $276.0 million, offset by a decrease of $42.8 million in average interest-earning cash accounts. Average interest-bearing liabilities increased by $241.4 million from the previous quarter as average interest-bearing deposits increased by $112.8 million and average borrowings increased by $128.6 million.

As compared to the same period in 2021, the net interest margin for the third quarter of 2022 decreased by 73 basis points to 3.84% from 4.57%, primarily due to a 123 basis point increase in the cost of average interest-bearing liabilities of $2.24 billion, offset by a 19 basis point increase in the yield on average interest-earning assets of $3.08 billion. Average earning assets for the third quarter of 2022 increased by $631.2 million from the third quarter of 2021, primarily due to a $650.7 million increase in average loans. Average interest-bearing liabilities for the third quarter of 2022 increased by $621.2 million from the third quarter of 2021, driven by an increase in average interest-bearing deposits of $486.5 million and an increase in average borrowings of $134.7 million.

Noninterest Income

Noninterest income for the third quarter of 2022 was $5.1 million, an increase of $448,000, or 9.6%, from the second quarter of 2022, primarily due to a significant increase in Small Business Administration ("SBA") servicing income and higher gains on sale of SBA loans as no SBA loans were sold during the second quarter of 2022, partially offset by lower mortgage loan fees, gains on sale of mortgage loans and mortgage servicing income. During the third quarter of 2022, we recorded a $111,000 fair value gain on our SBA servicing asset and no fair value impairment adjustment was recorded on our mortgage servicing asset.

Compared to the same period in 2021, noninterest income for the third quarter of 2022 decreased by $4.4 million, or 46.5%, primarily due to much lower gains on sale of SBA loans, mortgage loan fees and mortgage servicing income.

Noninterest Expense

Noninterest expense for the third quarter of 2022 totaled $12.7 million, a decrease of $431,000, or 3.3%, from $13.1 million for the second quarter of 2022. This decrease was primarily attributable to lower employee salaries, professional fees and FDIC deposit insurance premiums. Compared to the third quarter of 2021, noninterest expense during the third quarter of 2022 decreased by $423,000, or 3.2%, primarily due to lower salaries and commissions, occupancy expenses and bank security expenses, partially offset by higher communications expenses.

The Company's efficiency ratio was 36.4% for the third quarter of 2022 compared to 37.6% and 34.8% for the second quarter of 2022 and third quarter of 2021, respectively. For the nine months ended September 30, 2022, the efficiency ratio was 35.2% compared with 35.6% for the same period in 2021.

Income Tax Expense

The Company's effective tax rate for the third quarter of 2022 was 29.3%, compared to 26.0% for the second quarter of 2022 and 23.4% for the third quarter of 2021. The significant increase in the effective tax rate during the third quarter of 2022 was due to additional income tax expense of $1.4 million recorded during the quarter for the re-allocation of state income tax apportionment schedules for prior year's tax returns.

Balance Sheet

Total Assets

Total assets were $3.35 billion at September 30, 2022, an increase of $180.6 million, or 5.7%, from $3.17 billion at June 30, 2022, and an increase of $598.2 million, or 21.8%, from $2.75 billion at September 30, 2021. The $180.6 million increase in total assets at September 30, 2022 compared to June 30, 2022 was primarily due to increases in loans of $208.3 million, other assets of $13.6 million and federal funds sold of $12.6 million, partially offset by a decrease in cash and due from banks of $56.0 million. The $598.2 million increase in total assets at September 30, 2022 compared to September 30, 2021 was primarily due to increases in loans of $616.6 million, federal funds sold of $13.4 million, equity securities of $9.5 million, bank owned life insurance of $9.6 million and other assets of $33.5 million, partially offset by a $86.9 million decrease in cash and due from banks. 

Loans

Loans held for investment were $2.98 billion at September 30, 2022, an increase of $208.3 million, or 7.5%, compared to $2.77 billion at June 30, 2022, and an increase of $616.6 million, or 26.1%, compared to $2.36 billion at September 30, 2021. The increase in loans at September 30, 2022 compared to June 30, 2022 was primarily due to a $6.3 million increase in construction and development loans, a $27.5 million increase in commercial real estate loans and a $181.7 million increase in residential mortgages, offset by a $5.2 million decrease in commercial and industrial loans primarily due to PPP loan forgiveness. Included in commercial and industrial loans are PPP loans totaling $1.6 million as of September 30, 2022. PPP loans totaled $8.9 million as of June 30, 2022 and $42.0 million as of September 30, 2021. There were no loans classified as held for sale at September 30, 2022, June 30, 2022 or September 30, 2021.

Deposits

Total deposits were $2.57 billion at September 30, 2022, an increase of $173.8 million, or 7.3%, compared to total deposits of $2.40 billion at June 30, 2022, and an increase of $459.0 million, or 21.7%, compared to total deposits of $2.11 billion at September 30, 2021. The increase in total deposits at September 30, 2022 compared to June 30, 2022 was due to a $199.5 million increase in time deposits and a $5.6 million increase in money market accounts, offset by a $17.9 million decrease in noninterest-bearing demand deposits, a $7.4 million decrease in interest-bearing demand deposits and a $6.0 million decrease in savings accounts.

Noninterest-bearing deposits were $602.2 million at September 30, 2022, compared to $620.2 million at June 30, 2022 and $640.3 million at September 30, 2021. Noninterest-bearing deposits constituted 23.4% of total deposits at September 30, 2022, compared to 25.9% at June 30, 2022 and 30.3% at September 30, 2021. Interest-bearing deposits were $1.97 billion at September 30, 2022, compared to $1.78 billion at June 30, 2022 and $1.47 billion at September 30, 2021. Interest-bearing deposits constituted 76.6% of total deposits at September 30, 2022, compared to 74.1% at June 30, 2022 and 69.7% at September 30, 2021.

Asset Quality

The Company recorded a credit provision for loan losses of $1.7 million during the third quarter of 2022, compared to a $2.6 million provision expense during the third quarter of 2021. No provision for loan losses was recorded during the second quarter of 2022. The credit provision recorded during the third quarter of 2022 was due to the 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 third quarter of 2022 was 0.00%, compared to 0.00% for both the second quarter of 2022 and third quarter of 2021. The Company is not required to implement 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 until January 1, 2023, and is continuing to account for the allowance for loan losses under the incurred loss model.

Nonperforming assets totaled $32.5 million, or 0.97% of total assets, at September 30, 2022, a decrease of $1.5 million from $34.0 million, or 1.07% of total assets, at June 30, 2022, and an increase of $19.4 million from $13.1 million, or 0.47% of total assets, at September 30, 2021. The decrease in nonperforming assets at September 30, 2022 compared to June 30, 2022 was due to a $2.3 million decrease in nonaccrual loans and a $37,000 decrease in accruing troubled debt restructurings, offset by a $766,000 increase in other real estate owned.

Allowance for loan losses as a percentage of total loans was 0.50% at September 30, 2022, compared to 0.60% at June 30, 2022 and 0.69% at September 30, 2021. Allowance for loan losses as a percentage of nonperforming loans was 53.25% at September 30, 2022, compared to 54.79% and 189.44% at June 30, 2022 and September 30, 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, including statements regarding the effects of the ongoing COVID-19 pandemic and related variants on our business and financial results and conditions, 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: general business and economic conditions, particularly those affecting the financial services; 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; higher inflation and its impacts; 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

 

METROCITYBANKSHARES, INC SELECTED FINANCIAL DATA
		As of and for the Three Months Ended															As of and for the Nine Months Ended
		September 30,			June 30,			March 31,			December 31,			September 30,			September 30,			September 30,
(Dollars in thousands, except per share data)		2022			2022			2022			2021			2021			2022			2021
Selected income statement data:
Interest income		$	38,297		$	33,025		$	31,953		$	30,857		$	29,324		$	103,275		$	77,884
Interest expense			8,509			2,805			1,300			1,236			1,135			12,614			3,336
Net interest income			29,788			30,220			30,653			29,621			28,189			90,661			74,548
Provision for loan losses			(1,703)			—			104			546			2,579			(1,599)			6,383
Noninterest income			5,101			4,653			7,656			7,491			9,532			17,410			26,312
Noninterest expense			12,688			13,119			12,179			12,512			13,111			37,986			35,912
Income tax expense			7,011			5,654			6,597			6,609			5,149			19,262			14,309
Net income			16,893			16,100			19,429			17,445			16,882			52,422			44,256
Per share data:
Basic income per share		$	0.66		$	0.63		$	0.76		$	0.69		$	0.66		$	2.06		$	1.73
Diluted income per share		$	0.66		$	0.63		$	0.76		$	0.68		$	0.66		$	2.04		$	1.71
Dividends per share		$	0.15		$	0.15		$	0.15		$	0.14		$	0.12		$	0.45		$	0.32
Book value per share (at period end)		$	13.76		$	12.69		$	12.19		$	11.40		$	10.84		$	13.76		$	10.84
Shares of common stock outstanding			25,370,417			25,451,125			25,465,236			25,465,236			25,465,236			25,370,417			25,465,236
Weighted average diluted shares			25,702,023			25,729,156			25,719,035			25,720,128			25,729,043			25,732,004			25,805,480
Performance ratios:
Return on average assets			2.07	%		2.16	%		2.52	%		2.33	%		2.61	%		2.25	%		2.59	%
Return on average equity			20.56			20.65			26.94			24.80			25.23			22.57			23.09
Dividend payout ratio			22.75			23.85			19.76			20.52			18.24			21.98			18.64
Yield on total loans			5.11			4.95			5.00			4.93			5.16			5.03			5.19
Yield on average earning assets			4.94			4.65			4.34			4.32			4.75			4.65			4.79
Cost of average interest bearing liabilities			1.51			0.56			0.24			0.24			0.28			0.79			0.32
Cost of deposits			1.48			0.55			0.27			0.27			0.28			0.79			0.30
Net interest margin			3.84			4.26			4.16			4.15			4.57			4.08			4.59
Efficiency ratio(1)			36.37			37.62			31.79			33.71			34.76			35.15			35.61
Asset quality data (at period end):
Net charge-offs/(recoveries) to average loans held for investment			0.00	%		0.00	%		0.06	%		0.01	%		0.00	%		0.02	%		0.00	%
Nonperforming assets to gross loans and OREO			1.09			1.22			0.63			0.61			0.55			1.09			0.55
ALL to nonperforming loans			53.25			54.79			134.39			143.69			189.44			53.25			189.44
ALL to loans held for investment			0.50			0.60			0.66			0.67			0.69			0.50			0.69
Balance sheet and capital ratios:
Gross loans held for investment to deposits			116.21	%		115.86	%		105.72	%		110.98	%		112.15	%		116.21	%		112.15	%
Noninterest bearing deposits to deposits			23.43			25.87			25.84			26.18			30.32			23.43			30.32
Common equity to assets			10.42			10.20			9.88			9.34			10.04			10.42			10.04
Leverage ratio			9.90			10.31			9.46			9.44			10.34			9.90			10.34
Common equity tier 1 ratio			16.18			16.70			17.24			16.76			16.61			16.18			16.61
Tier 1 risk-based capital ratio			16.18			16.70			17.24			16.76			16.61			16.18			16.61
Total risk-based capital ratio			16.94			17.60			18.22			17.77			17.64			16.94			17.64
Mortgage and SBA loan data:
Mortgage loans serviced for others		$	550,587		$	589,500		$	605,112		$	608,208		$	669,358		$	550,587		$	669,358
Mortgage loan production			255,662			326,973			162,933			237,195			368,790			745,568			958,995
Mortgage loan sales			—			37,928			56,987			—			—			94,915			—
SBA loans serviced for others			489,120			504,894			528,227			542,991			549,818			489,120			549,818
SBA loan production			22,193			21,407			50,689			52,727			85,265			94,289			233,107
SBA loan sales			8,588			—			22,898			30,169			37,984			31,486			94,541
_____________________________________________
(1)   Represents noninterest expense divided by the sum of net interest income plus noninterest income.

 

 

METROCITYBANKSHARES, INC CONSOLIDATED BALANCE SHEETS (UNAUDITED)
		As of the Quarter Ended
		September 30,			June 30,			March 31,			December 31,			September 30,
(Dollars in thousands, except per share data)		2022			2022			2022			2021			2021
ASSETS
Cash and due from banks		$	164,054		$	220,027		$	418,988		$	432,523		$	250,995
Federal funds sold			15,669			3,069			5,743			8,818			2,294
Cash and cash equivalents			179,723			223,096			424,731			441,341			253,289
Equity securities			10,452			10,778			11,024			11,386			993
Securities available for sale (at fair value)			19,978			21,394			23,886			25,733			16,507
Loans			2,978,318			2,770,020			2,512,300			2,505,070			2,361,705
Allowance for loan losses			(14,982)			(16,678)			(16,674)			(16,952)			(16,445)
Loans less allowance for loan losses			2,963,336			2,753,342			2,495,626			2,488,118			2,345,260
Loans held for sale			—			—			37,928			—			—
Accrued interest receivable			11,732			10,990			10,644			11,052			10,737
Federal Home Loan Bank stock			15,619			15,619			15,806			19,701			12,201
Premises and equipment, net			13,664			12,847			12,814			13,068			13,302
Operating lease right-of-use asset			8,835			8,518			8,925			9,338			9,672
Foreclosed real estate, net			4,328			3,562			3,562			3,618			4,374
SBA servicing asset, net			8,324			8,216			10,554			10,234			10,916
Mortgage servicing asset, net			4,975			6,090			6,925			7,747			8,593
Bank owned life insurance			68,697			68,267			67,841			59,437			59,061
Other assets			38,776			25,131			12,051			5,385			5,323
Total assets		$	3,348,439		$	3,167,850		$	3,142,317		$	3,106,158		$	2,750,228
LIABILITIES
Noninterest-bearing deposits		$	602,246		$	620,182		$	615,650		$	592,444		$	640,312
Interest-bearing deposits			1,968,607			1,776,826			1,766,491			1,670,576			1,471,515
Total deposits			2,570,853			2,397,008			2,382,141			2,263,020			2,111,827
Federal Home Loan Bank advances			375,000			375,000			380,000			500,000			300,000
Other borrowings			396			399			405			459			468
Operating lease liability			9,303			9,031			9,445			9,861			10,241
Accrued interest payable			1,489			703			207			204			208
Other liabilities			42,369			62,640			59,709			42,391			51,330
Total liabilities		$	2,999,410		$	2,844,781		$	2,831,907		$	2,815,935		$	2,474,074
SHAREHOLDERS' EQUITY
Preferred stock			—			—			—			—			—
Common stock			254			255			255			255			255
Additional paid-in capital			48,914			49,831			51,753			51,559			51,181
Retained earnings			279,475			266,426			254,165			238,577			224,711
Accumulated other comprehensive income (loss)			20,386			6,557			4,237			(168)			7
Total shareholders' equity			349,029			323,069			310,410			290,223			276,154
Total liabilities and shareholders' equity		$	3,348,439		$	3,167,850		$	3,142,317		$	3,106,158		$	2,750,228

 

 

METROCITYBANKSHARES, INC CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
		Three Months Ended															Nine Months Ended
		September 30,			June 30,			March 31,			December 31,			September 30,			September 30,			September 30,
(Dollars in thousands, except per share data)		2022			2022			2022			2021			2021			2022			2021
Interest and dividend income:
Loans, including Fees		$	37,263		$	32,310		$	31,459		$	30,496		$	29,127		$	101,032		$	77,355
Other investment income			1,011			711			492			360			196			2,214			525
Federal funds sold			23			4			2			1			1			29			4
Total interest income			38,297			33,025			31,953			30,857			29,324			103,275			77,884
Interest expense:
Deposits			6,964			2,384			1,139			1,069			968			10,487			2,879
FHLB advances and other borrowings			1,545			421			161			167			167			2,127			457
Total interest expense			8,509			2,805			1,300			1,236			1,135			12,614			3,336
Net interest income			29,788			30,220			30,653			29,621			28,189			90,661			74,548
Provision for loan losses			(1,703)			—			104			546			2,579			(1,599)			6,383
Net interest income after provision for loan losses			31,491			30,220			30,549			29,075			25,610			92,260			68,165
Noninterest income:
Service charges on deposit accounts			509			518			481			466			446			1,508			1,230
Other service charges, commissions and fees			2,676			3,647			2,159			3,015			4,147			8,482			11,422
Gain on sale of residential mortgage loans			—			806			1,211			—			—			2,017			—
Mortgage servicing income, net			(358)			(5)			101			95			132			(262)			(659)
Gain on sale of SBA loans			500			—			1,568			2,895			3,358			2,068			8,057
SBA servicing income, net			1,330			(1,077)			1,644			634			1,212			1,897			5,250
Other income			444			764			492			386			237			1,700			1,012
Total noninterest income			5,101			4,653			7,656			7,491			9,532			17,410			26,312
Noninterest expense:
Salaries and employee benefits			7,756			7,929			7,096			7,819			8,679			22,781			22,293
Occupancy			1,167			1,200			1,227			1,206			1,295			3,594			3,822
Data Processing			270			261			277			252			257			808			848
Advertising			158			126			150			148			131			434			393
Other expenses			3,337			3,603			3,429			3,087			2,749			10,369			8,556
Total noninterest expense			12,688			13,119			12,179			12,512			13,111			37,986			35,912
Income before provision for income taxes			23,904			21,754			26,026			24,054			22,031			71,684			58,565
Provision for income taxes			7,011			5,654			6,597			6,609			5,149			19,262			14,309
Net income available to common shareholders		$	16,893		$	16,100		$	19,429		$	17,445		$	16,882		$	52,422		$	44,256

 

 

METROCITYBANKSHARES, INC AVERAGE BALANCES AND YIELDS/RATES
		Three Months Ended
		September 30, 2022								June 30, 2022								September 30, 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)		$	151,177		$	903		2.37	%	$	193,955		$	592		1.22	%	$	188,296		$	111		0.23	%
Investment securities			34,792			131		1.49			35,754			123		1.38			17,244			86		1.98
Total investments			185,969			1,034		2.21			229,709			715		1.25			205,540			197		0.38
Construction and development			38,636			530		5.44			32,647			414		5.09			53,871			727		5.35
Commercial real estate			601,370			9,905		6.53			575,917			8,403		5.85			507,039			7,648		5.98
Commercial and industrial			50,605			909		7.13			54,423			915		6.74			102,813			2,576		9.94
Residential real estate			2,201,186			25,885		4.67			1,952,730			22,545		4.63			1,577,276			18,144		4.56
Consumer and other			137			34		98.46			266			33		49.76			208			32		61.04
Gross loans(2)			2,891,934			37,263		5.11			2,615,983			32,310		4.95			2,241,207			29,127		5.16
Total earning assets			3,077,903			38,297		4.94			2,845,692			33,025		4.65			2,446,747			29,324		4.75
Noninterest-earning assets			158,579								146,669								123,888
Total assets			3,236,482								2,992,361								2,570,635
Interest-bearing liabilities:
NOW and savings deposits			186,459			338		0.72			197,460			102		0.21			115,775			59		0.20
Money market deposits			1,179,954			5,189		1.74			1,166,272			1,860		0.64			757,654			432		0.23
Time deposits			499,577			1,437		1.14			389,449			422		0.43			506,049			477		0.37
Total interest-bearing deposits			1,865,990			6,964		1.48			1,753,181			2,384		0.55			1,379,478			968		0.28
Borrowings			375,405			1,545		1.63			246,779			421		0.68			240,704			167		0.28
Total interest-bearing liabilities			2,241,395			8,509		1.51			1,999,960			2,805		0.56			1,620,182			1,135		0.28
Noninterest-bearing liabilities:
Noninterest-bearing deposits			599,902								611,763								600,388
Other noninterest-bearing liabilities			69,131								67,979								84,568
Total noninterest-bearing liabilities			669,033								679,742								684,956
Shareholders' equity			326,054								312,659								265,497
Total liabilities and shareholders' equity		$	3,236,482							$	2,992,361							$	2,570,635
Net interest income					$	29,788							$	30,220							$	28,189
Net interest spread								3.43								4.09								4.47
Net interest margin								3.84								4.26								4.57
______________________________________________
(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
		Nine Months Ended
		September 30, 2022								September 30, 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)		$	247,348		$	1,860		1.01	%	$	161,420		$	260		0.22	%
Investment securities			35,789			383		1.43			17,493			269		2.06
Total investments			283,137			2,243		1.06			178,913			529		0.40
Construction and development			33,985			1,322		5.20			47,380			1,874		5.29
Commercial real estate			575,664			26,195		6.08			496,957			22,069		5.94
Commercial and industrial			56,772			2,900		6.83			133,703			7,054		7.05
Residential real estate			2,021,332			70,504		4.66			1,315,043			46,254		4.70
Consumer and other			203			111		73.11			187			104		74.36
Gross loans(2)			2,687,956			101,032		5.03			1,993,270			77,355		5.19
Total earning assets			2,971,093			103,275		4.65			2,172,183			77,884		4.79
Noninterest-earning assets			149,157								115,784
Total assets			3,120,250								2,287,967
Interest-bearing liabilities:
NOW and savings deposits			190,390			515		0.36			105,139			158		0.20
Money market deposits			1,144,337			7,706		0.90			651,158			1,143		0.23
Time deposits			443,632			2,266		0.68			506,445			1,578		0.42
Total interest-bearing deposits			1,778,359			10,487		0.79			1,262,742			2,879		0.30
Borrowings			363,170			2,127		0.78			141,435			457		0.43
Total interest-bearing liabilities			2,141,529			12,614		0.79			1,404,177			3,336		0.32
Noninterest-bearing liabilities:
Noninterest-bearing deposits			600,045								548,844
Other noninterest-bearing liabilities			68,144								78,685
Total noninterest-bearing liabilities			668,189								627,529
Shareholders' equity			310,532								256,261
Total liabilities and shareholders' equity		$	3,120,250							$	2,287,967
Net interest income					$	90,661							$	74,548
Net interest spread								3.86								4.47
Net interest margin								4.08								4.59
_______________________________________________
(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
		September 30, 2022					June 30, 2022					March 31, 2022					December 31, 2021					September 30, 2021
					% of					% of					% of					% of					% of
(Dollars in thousands)		Amount			Total		Amount			Total		Amount			Total		Amount			Total		Amount			Total
Construction and Development		$	51,300		1.7	%	$	45,042		1.6	%	$	38,683		1.6	%	$	38,857		1.6	%	$	64,140		2.7	%
Commercial Real Estate			608,700		20.4			581,234		20.9			567,031		22.5			520,488		20.7			503,417		21.2
Commercial and Industrial			52,693		1.8			57,843		2.1			66,073		2.6			73,072		2.9			82,099		3.5
Residential Real Estate			2,274,679		76.1			2,092,952		75.4			1,846,434		73.3			1,879,012		74.8			1,718,593		72.6
Consumer and other			198		—			165		—			130		—			79		—			238		—
Gross loans		$	2,987,570		100.0	%	$	2,777,236		100.0	%	$	2,518,351		100.0	%	$	2,511,508		100.0	%	$	2,368,487		100.0	%
Unearned income			(9,252)					(7,216)					(6,051)					(6,438)					(6,782)
Allowance for loan losses			(14,982)					(16,678)					(16,674)					(16,952)					(16,445)
Net loans		$	2,963,336				$	2,753,342				$	2,495,626				$	2,488,118				$	2,345,260

 

 

METROCITY BANKSHARES, INC. NONPERFORMING ASSETS
		As of the Quarter Ended
		September 30,			June 30,			March 31,			December 31,			September 30,
(Dollars in thousands)		2022			2022			2022			2021			2021
Nonaccrual loans		$	17,700		$	19,966		$	9,506		$	8,759		$	5,955
Past due loans 90 days or more and still accruing			—			—			—			342			—
Accruing troubled debt restructured loans			10,437			10,474			2,901			2,697			2,726
Total non-performing loans			28,137			30,440			12,407			11,798			8,681
Other real estate owned			4,328			3,562			3,562			3,618			4,374
Total non-performing assets		$	32,465		$	34,002		$	15,969		$	15,416		$	13,055
Nonperforming loans to gross loans			0.94	%		1.10	%		0.49	%		0.47	%		0.37	%
Nonperforming assets to total assets			0.97			1.07			0.51			0.50			0.47
Allowance for loan losses to non-performing loans			53.25			54.79			134.39			143.69			189.44

 

 

METROCITY BANKSHARES, INC. ALLOWANCE FOR LOAN LOSSES
		As of and for the Three Months Ended															As of and for the Nine Months Ended
		September 30,			June 30,			March 31,			December 31,			September 30,			September 30,			September 30,
(Dollars in thousands)		2022			2022			2022			2021			2021			2022			2021
Balance, beginning of period		$	16,678		$	16,674		$	16,952		$	16,445		$	13,860		$	16,952		$	10,135
Net charge-offs/(recoveries):
Construction and development			—			—			—			—			—			—			—
Commercial real estate			(1)			(2)			(2)			39			(4)			(5)			16
Commercial and industrial			(6)			(2)			389			—			—			381			64
Residential real estate			—			—			—			—			—			—			—
Consumer and other			—			—			(5)			—			(2)			(5)			(7)
Total net charge-offs/(recoveries)			(7)			(4)			382			39			(6)			371			73
Provision for loan losses			(1,703)			—			104			546			2,579			(1,599)			6,383
Balance, end of period		$	14,982		$	16,678		$	16,674		$	16,952		$	16,445		$	14,982		$	16,445
Total loans at end of period		$	2,987,570		$	2,777,236		$	2,518,351		$	2,511,508		$	2,368,487		$	2,987,570		$	2,368,487
Average loans(1)		$	2,891,934		$	2,597,019		$	2,533,254		$	2,453,402		$	2,241,207		$	2,678,474		$	1,993,270
Net charge-offs to average loans			0.00	%		0.00	%		0.06	%		0.01	%		0.00	%		0.02	%		0.00	%
Allowance for loan losses to total loans			0.50			0.60			0.66			0.67			0.69			0.50			0.69
________________________________________________
(1)   Excludes loans held for sale

 

 

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SOURCE MetroCity Bankshares, Inc.

FAQ

What were MetroCity's earnings for Q3 2022?

MetroCity reported a net income of $16.9 million, or $0.66 per diluted share for Q3 2022.

How did MetroCity's total assets change in Q3 2022?

Total assets increased by $180.6 million, or 5.7%, to $3.35 billion in Q3 2022.

What is the current stock price of MCBS?

The latest stock price of MetroCity Bankshares (MCBS) can be found on financial news websites or market platforms.

What is the outlook for MetroCity's net interest margin?

MetroCity's net interest margin declined to 3.84% in Q3 2022, indicating potential pressure on future profitability.

How does MetroCity's Q3 performance compare to Q2 2022?

MetroCity's net income increased by 4.9% from $16.1 million in Q2 2022, despite a decline in net interest margin.