MainStreet Bancshares, Inc., Reports Record Earnings for 1st Quarter 2023

Rhea-AI Summary

MainStreet Bancshares, Inc. (Nasdaq: MNSB, MNSBP) reported a record net income of $8.2 million for Q1 2023, a 50% increase compared to the same quarter in 2022. The data reflects a 1.75% ROAA, 4.69% NIM, and $1.01 EPS. The loan portfolio grew 14.4% to $1.62 billion, while total deposits climbed 13.8% to $1.63 billion. The net interest income surged 38.8% to $21.1 million. Despite challenges in the banking sector, the bank's risk management has proven robust, with zero nonperforming assets. The efficiency ratio improved to 53%. The launch of Avenu™, a fintech platform expected to boost deposit growth, is on track for April 30, 2023.

Positive

• Record net income of $8.2 million, up 50% YoY.
• Net interest income reached $21.1 million, up 38.8% YoY.
• Loan portfolio grew 14.4% to $1.62 billion.
• Total deposits climbed 13.8% to $1.63 billion.
• Avenu™ launch expected to boost deposit growth.
• Efficiency ratio improved to 53% from 55% YoY.

Negative

• Increased credit reserves by 15.6% under CECL accounting standard.
• Low level of Accumulated Other Comprehensive Income at -3.7% of total capital.

Steady Loan and Deposit Growth Fuel 8% Rise in Quarter-to-Quarter Net Income

FAIRFAX, Va., April 17, 2023 /PRNewswire/ -- MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the holding company for MainStreet Bank, reported record net income of $8.2 million for the quarter-ended March 31, 2023.  This represents a 50% increase from the net income reported in the 1^st quarter of 2022.  First-quarter results represent:

• 1.75% ROAA
• 4.69% NIM
• $1.01 EPS
• $22.22 TBV
• 16.4% ROAE

(ROAA – Return on Average Assets; NIM – Net Interest Margin; EPS – Earnings Per Share common basic and diluted; TBV – Tangible Book Value per common share; ROAE – Return on Average Total Equity.)

The Company has a solid risk management foundation and once again reports record earnings for the first quarter of 2023

"In light of the recent banking tensions, we'd be remiss if we didn't address the important issues on the table," said Jeff W. Dick, Chairman and CEO of MainStreet Bancshares, Inc. and MainStreet Bank. "We've taken the opportunity to re-evaluate our risk management processes along with our current balance sheet strategy.  The result of that review is that we remain comfortable and confident with our risk profile - given the current and anticipated economic environment. Our deposit base is stable and growing. Currently nearly 70% of our outstanding deposits are insured by the FDIC and we offer all depositors access to additional FDIC insurance coverage through IntraFi. Our systems for managing liquidity risk, interest rate risk, and credit risk, along with all the other risks we manage daily, continue to give us an accurate assessment of the Bank and allow us to manage to our approved risk tolerance. Our primary objective is to ensure the ongoing safety and soundness of the Bank and the protection of depositor's money. We have demonstrated the ability to do just that while pursuing good opportunities and rewarding investors with high quality performance."

The Company has a solid risk management foundation. The leadership team built the Bank with good risk management systems and procedures in place from the start. Mr. Dick's strong background in risk management started with his first career as a prudential banking supervisor in the U.S. and then in the U.K. While in the U.K., Mr. Dick was an adviser to the Bank of England on modernizing their approach to risk-based banking supervision.

Net interest income reached $21.1 million in the quarter ended March 31, 2023, up 38.8% from the year-earlier first quarter's $15.2 million. MainStreet Bank benefited from having an asset-sensitive balance sheet during a 12-month period in which the Federal Reserve undertook nine interest rate increases, beginning in March 2022. This propelled the average net interest margin (NIM) higher by 76 basis points to 4.69% for the quarter ended March 31, 2023, versus 3.93% a year earlier.

"Implementing the Current Expected Credit Losses (CECL) accounting standard in the first quarter of 2023 resulted in a 15.6% increase in credit reserves. In all, we increased our credit reserves to $16.6 million, a 17.6% increase that also reflects loan growth," said Thomas J. Chmelik, Chief Financial Officer of MainStreet Bancshares Inc. and MainStreet Bank. He noted that the level of Accumulated Other Comprehensive Income (AOCI) for the Company remains low, at -3.7% of total capital.

The loan portfolio grew 14.4% to $1.62 billion as of March 31, 2023, up from $1.41 billion in the year-earlier first quarter. Loan quality remained pristine, with zero nonperforming assets. Total deposits climbed 13.8% to $1.63 billion, up from $1.43 billion a year earlier. Non-interest-bearing deposits represent 29.9% of the total, and 63.9% of total deposits are core deposits. There was significant growth in time deposits, which rose to $730.1 million, up 58.4% from a year earlier. The bank's total assets grew 16.6% to reach $2.06 billion as of March 31, 2023, versus $1.76 billion a year earlier.

"While all banks are experiencing some runoff in non-interest-bearing deposits, we were able to attract approximately $30 million in fresh deposits during a period of market upheaval in March, and loan demand and core deposit growth continue to be solid in our DC Metro market," said Abdul Hersiburane, President of MainStreet Bank. "Pressure on deposit pricing is to be expected in a rising-rate environment, and we are responding with products that carry yields and terms calibrated to our assessment of the interest rate outlook, such as a 15-month CD."

The Company's efficiency ratio stood at 53% for the quarter ended March 31, 2023, from 55% a year earlier. This improvement occurred even as the Company was making significant investments in Avenu™, with the hiring process accelerating as the division moves toward being fully operational in 2023.

Avenu™ Makes Major Strides, Onboards First Client
Avenu™ is tracking to an April 30 launch as our designers and engineers complete final sprints to harden our multitenancy and cyber architecture and to accelerate implementation of a debit card for funding. Avenu™ connects our fintech partners and their apps directly and seamlessly to MainStreet Bank's banking core. Avenu™ is expected to accelerate MainStreet Bank's deposit growth to support expanded lending.

"With three companies now signed up to proceed, we are inches away from going live with Avenu™, which will be a gateway to fast, simple secure payments for our end-users," said Todd Youngren, president of Avenu™. "When you are developing a platform from the ground up, you have to address challenges as they arise, and that's exactly what we've been doing as our team works full tilt toward our launch."

Chairman and CEO Jeff W. Dick elaborated: "We are committed to a seamless launch for Avenu™, and in the current environment we feel strongly that time is on our side. We are unwilling to cut corners because reliability and compliance are critical features of Avenu™. We are very proud of creating an innovative system that allows partners to connect to the core system of a reliable bank with sharp instincts about risks and compliance."

ABOUT AVENU™
Avenu™ — Banking Delivered
Avenu™ is the only embedded banking solution that connects our partners and their apps directly and seamlessly to a banking core — MainStreet Bank's banking core. We are not a sponsor bank without our own technology, and we are not a middleware software company (aggregator) without our own bank. We are Avenu™, a leading financial technology company backed by an established community business bank in the heart of Washington, D.C.

Avenu™ — Serving a Community of Innovation
Our clients are fintechs, application developers, money movers, and entrepreneurs. They all have one thing in common: They are innovating how money moves to solve real-world issues and help communities thrive. We are focused on servicing our community and long-term business relationships.

ABOUT MAINSTREET BANK: MainStreet operates six branches in Herndon, Fairfax, McLean, Leesburg, Clarendon, and Washington, D.C. MainStreet Bank has 55,000 free ATMs and a fully integrated online and mobile banking solution. The Bank is not restricted by a conventional branching system, as it can offer business customers the ability to Put Our Bank in Your Office®. With robust and easy-to-use online business banking technology, MainStreet has "put our bank" in thousands of businesses in the metropolitan area.

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

MainStreet Bank was the first community bank in the Washington, D.C., metropolitan area to offer a full online business banking solution. MainStreet Bank was also the first bank headquartered in the Commonwealth of Virginia to offer excess FDIC insurance through IntraFi. 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: Debra Cope
Director of Corporate Communications
(703) 481-4599

UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION
(In thousands)
		March 31, 2023				December 31, 2022				September 30, 2022				June 30, 2022				March 31, 2022
ASSETS
Cash and cash equivalents
Cash and due from banks		$	225,334			$	48,931			$	50,636			$	55,636			$	63,986
Federal funds sold			—				81,669				54,098				47,013				37,756
Total cash and cash equivalents			225,334				130,600				104,734				102,649				101,742
Investment securities available for sale, at fair value			63,209				62,631				162,319				143,240				123,802
Investment securities held to maturity, at amortized cost			17,616				17,642				17,670				17,698				18,769
Restricted equity securities, at amortized cost			22,436				24,325				16,436				16,485				17,209
Loans, net of allowance for loan losses of $15,435, $14,114, $12,994,$12,982, and $12,500, respectively			1,617,275				1,579,950				1,448,071				1,416,875				1,413,238
Premises and equipment, net			14,521				14,709				14,523				14,756				14,833
Accrued interest and other receivables			9,744				9,581				8,273				7,313				6,980
Computer software, net of amortization			10,559				9,149				7,258				4,956				3,906
Bank owned life insurance			37,503				37,249				36,996				36,742				36,492
Other assets			36,811				39,915				43,835				32,665				24,777
Total Assets		$	2,055,008			$	1,925,751			$	1,860,115			$	1,793,379			$	1,761,748
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Non-interest bearing deposits		$	487,875			$	550,690			$	566,016			$	535,591			$	514,160
Interest bearing DDA deposits			100,522				80,099				93,695				99,223				76,286
Savings and NOW deposits			53,499				51,419				54,240				58,156				81,817
Money market deposits			260,316				222,540				254,190				231,207				301,842
Time deposits			730,076				608,141				585,783				575,950				460,839
Total deposits			1,632,288				1,512,889				1,553,924				1,500,127				1,434,944
Federal funds borrowed			60,696				—				—				—				—
Federal Home Loan Bank advances			45,000				100,000				—				—				40,000
Subordinated debt			72,344				72,245				72,146				72,047				71,955
Other liabilities			39,692				42,335				44,045				32,801				26,053
Total Liabilities			1,850,020				1,727,469				1,670,115				1,604,975				1,572,952
Stockholders' Equity:
Preferred stock			27,263				27,263				27,263				27,263				27,263
Common stock			29,185				28,736				28,728				29,178				29,642
Capital surplus			64,213				63,999				63,231				64,822				66,798
Retained earnings			91,991				86,830				80,534				73,702				68,691
Accumulated other comprehensive loss			(7,664)				(8,546)				(9,756)				(6,561)				(3,598)
Total Stockholders' Equity			204,988				198,282				190,000				188,404				188,796
Total Liabilities and Stockholders' Equity		$	2,055,008			$	1,925,751			$	1,860,115			$	1,793,379			$	1,761,748

 

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION
(In thousands, except share and per share data)
		Year-to-Date								Three Months Ended
		March 31, 2023				March 31, 2022				March 31, 2023				December 31, 2022				September 30, 2022				June 30, 2022				March 31, 2022
INTEREST INCOME:
Interest and fees on loans		$	26,731			$	16,685			$	26,731			$	23,972			$	20,261			$	17,954			$	16,685
Interest on investment securities
Taxable securities			518				357				518				467				378				401				357
Tax-exempt securities			264				272				264				262				261				263				272
Interest on federal funds sold			1,132				34				1,132				1,071				1,013				195				34
Total interest income			28,645				17,348				28,645				25,772				21,913				18,813				17,348
INTEREST EXPENSE:
Interest on interest bearing DDA deposits			343				65				343				256				175				105				65
Interest on savings and NOW deposits			108				37				108				81				43				42				37
Interest on money market deposits			1,203				119				1,203				781				496				151				119
Interest on time deposits			4,144				1,431				4,144				2,966				2,275				1,530				1,431
Interest on federal funds borrowed			38				—				38				—				—				—				—
Interest on Federal Home Loan Bank advances			906				31				906				264				—				52				31
Interest on subordinated debt			812				468				812				828				828				812				468
Total interest expense			7,554				2,151				7,554				5,176				3,817				2,692				2,151
Net interest income			21,091				15,197				21,091				20,596				18,096				16,121				15,197
Provision for credit losses			283				800				283				1,118				—				480				800
Net interest income after provision for loan losses			20,808				14,397				20,808				19,478				18,096				15,641				14,397
NON-INTEREST INCOME:
Deposit account service charges			590				611				590				610				601				597				611
Bank owned life insurance income			255				251				255				253				254				250				251
Loan swap fee income			—				—				—				—				518				101				—
Net gain on held-to-maturity securities			—				—				—				—				—				4				—
Net gain (loss) on sale of loans			—				43				—				—				(211)				—				43
Other non-interest income			158				257				158				196				186				312				257
Total other income			1,003				1,162				1,003				1,059				1,348				1,264				1,162
NON-INTEREST EXPENSES:
Salaries and employee benefits			7,621				5,548				7,621				6,775				5,874				5,604				5,548
Furniture and equipment expenses			498				657				498				710				760				659				657
Advertising and marketing			797				406				797				620				704				574				406
Occupancy expenses			486				341				486				378				400				352				341
Outside services			490				368				490				529				611				567				368
Administrative expenses			215				210				215				214				253				195				210
Other operating expenses			1,596				1,433				1,596				1,481				1,291				1,543				1,433
Total non-interest expenses			11,703				8,963				11,703				10,707				9,893				9,494				8,963
Income before income tax expense			10,108				6,596				10,108				9,830				9,551				7,411				6,596
Income tax expense			1,957				1,173				1,957				2,252				1,808				1,481				1,173
Net income			8,151				5,423				8,151				7,578				7,743				5,930				5,423
Preferred stock dividends			539				539				539				539				539				539				539
Net income available to common shareholders		$	7,612			$	4,884			$	7,612			$	7,039			$	7,204			$	5,391			$	4,884
Net income per common share, basic and diluted		$	1.01			$	0.64			$	1.01			$	0.95			$	0.97			$	0.71			$	0.64
Weighted average number of common shares, basic and diluted			7,517,213				7,647,519				7,517,213				7,433,607				7,463,719				7,575,484				7,647,519

 

UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL
(In thousands)
		March 31, 2023								December 31, 2022								March 31, 2022								Percentage Change
		$ Amount				% of Total				$ Amount				% of Total				$ Amount				% of Total				Last 3 Mos				Last 12 Mos
LOANS:
Construction and land development loans		$	415,078				25.3	%		$	393,783				24.6	%		$	344,605				24.0	%			5.4	%			20.5	%
Residential real estate loans			391,648				23.9	%			394,394				24.7	%			367,138				25.7	%			-0.7	%			6.7	%
Commercial real estate loans			737,019				45.0	%			700,728				43.8	%			588,005				41.1	%			5.2	%			25.3	%
Commercial and industrial loans			86,937				5.3	%			97,351				6.1	%			111,183				7.8	%			-10.7	%			-21.8	%
Consumer loans			7,534				0.5	%			13,336				0.8	%			19,711				1.4	%			-43.5	%			-61.8	%
Total Gross Loans		$	1,638,216				100.0	%		$	1,599,592				100.0	%		$	1,430,642				100.0	%			2.4	%			14.5	%
Less: Allowance for credit losses			(15,435)								(14,114)								(12,500)
Net deferred loan fees			(5,506)								(5,528)								(4,904)
Net Loans		$	1,617,275							$	1,579,950							$	1,413,238
DEPOSITS:
Non-interest bearing demand deposits		$	487,875				29.9	%		$	550,690				36.4	%		$	514,160				35.9	%			-11.4	%			-5.1	%
Interest-bearing demand deposits:
Demand deposits			100,522				6.2	%			80,099				5.3	%			76,286				5.3	%			25.5	%			31.8	%
Savings and NOW deposits			53,499				3.3	%			51,419				3.4	%			81,817				5.7	%			4.0	%			-34.6	%
Money market accounts			260,316				15.9	%			222,540				14.7	%			301,842				21.0	%			17.0	%			-13.8	%
Certificates of deposit $250,000 or more			458,683				28.1	%			370,005				24.5	%			292,978				20.4	%			24.0	%			56.6	%
Certificates of deposit less than $250,000			271,393				16.6	%			238,136				15.7	%			167,861				11.7	%			14.0	%			61.7	%
Total Deposits		$	1,632,288				100.0	%		$	1,512,889				100.0	%		$	1,434,944				100.0	%			7.9	%			13.8	%
BORROWINGS:
Federal funds borrowed			60,696				34.1	%			—				—				—				—				—				—
Federal Home Loan Bank advances			45,000				25.3	%			100,000				58.1	%			40,000				35.7	%			-55.0	%			12.5	%
Subordinated debt			72,344				40.6	%			72,245				41.9	%			71,955				64.3	%			0.1	%			0.5	%
Total Borrowings		$	178,040				100.0	%		$	172,245				100.0	%		$	111,955				100.0	%			3.4	%			59.0	%
Total Deposits and Borrowings		$	1,810,328							$	1,685,134							$	1,546,899								7.4	%			17.0	%
Core customer funding sources (1)		$	1,156,279				63.9	%		$	1,157,573				68.7	%		$	1,135,503				73.4	%			-0.1	%			1.8	%
Brokered and listing service sources (2)			476,009				26.3	%			355,316				21.1	%			299,441				19.4	%			34.0	%			59.0	%
Federal funds borrowed			60,696				3.3	%			—				—				—				—				—				—
Federal Home Loan Bank advances			45,000				2.5	%			100,000				5.9	%			40,000				2.6	%			-55.0	%			12.5	%
Subordinated debt (3)			72,344				4.0	%			72,245				4.3	%			71,955				4.6	%			0.1	%			0.5	%
Total Funding Sources		$	1,810,328				100.0	%		$	1,685,134				100.0	%		$	1,546,899				100.0	%			7.4	%			17.0	%

(1)	Includes ICS, CDARS, and reciprocal deposits maintained by customers, which represent sweep accounts tied to customer operating accounts
(2)	Consists of certificates of deposit (CD) through multiple listing services and multiple brokered deposit services, as well as ICS and CDARS one-way certificates of deposit and regional money market accounts
(3)	Subordinated debt obligation qualifies as Tier 2 capital at the holding company and Tier 1 capital at the Bank

 

UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES
(In thousands)
		For the three months ended March 31, 2023												For the three months ended March 31, 2022
		Average Balance				Interest Income/ Expense (3)(4)				Average Yields/ Rate (annualized) (3)(4)				Average Balance				Interest Income/ Expense (3)(4)				Average Yields/ Rate (annualized) (3)(4)
ASSETS:
Interest earning assets:
Loans (1)(2)		$	1,599,756			$	26,731				6.78	%		$	1,377,723			$	16,685				4.91	%
Securities:
Taxable			71,933				518				2.92	%			73,413				357				1.97	%
Tax-exempt			37,941				334				3.57	%			39,545				344				3.53	%
Federal funds and interest- bearing deposits			118,670				1,132				3.87	%			83,754				34				0.16	%
Total interest earning assets		$	1,828,300			$	28,715				6.37	%		$	1,574,435			$	17,420				4.49	%
Other assets			57,371												88,386
Total assets		$	1,885,671											$	1,662,821
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits		$	83,388			$	343				1.67	%		$	70,403			$	65				0.37	%
Savings and NOW deposits			51,943				108				0.84	%			82,758				37				0.18	%
Money market deposit accounts			225,037				1,203				2.17	%			267,905				119				0.18	%
Time deposits			673,441				4,144				2.50	%			456,782				1,431				1.27	%
Total interest-bearing deposits		$	1,033,809			$	5,798				2.27	%		$	877,848			$	1,652				0.76	%
Federal funds purchased			2,965				38				5.20	%			1				—				—
Subordinated debt			72,306				812				4.55	%			43,995				468				4.31	%
FHLB borrowings			77,833				906				4.72	%			37,167				31				0.34	%
Total interest-bearing liabilities		$	1,186,913			$	7,554				2.58	%		$	959,011			$	2,151				0.91	%
Demand deposits and other liabilities			497,155												514,101
Total liabilities		$	1,684,068											$	1,473,112
Stockholders' Equity			201,603												189,709
Total Liabilities and Stockholders' Equity		$	1,885,671											$	1,662,821
Interest Rate Spread											3.79	%											3.58	%
Net Interest Income						$	21,161											$	15,269
Net Interest Margin											4.69	%											3.93	%

(1)	Includes loans classified as non-accrual
(2)	Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs
(3)	Income and yields for all periods presented are reported on a tax-equivalent basis using the federal statutory rate of 21%
(4)	Refer to Appendix for reconciliation of non-GAAP measures

 

UNAUDITED SUMMARY FINANCIAL DATA
(Dollars in thousands except per share data)
		At or For the Three Months Ended
		March 31,
		2023				2022
Per share Data and Shares Outstanding
Earnings per common share (basic and diluted)		$	1.01			$	0.64
Book value per common share		$	23.62			$	21.12
Tangible book value per common share(2)		$	22.22			$	20.61
Weighted average common shares (basic and diluted)			7,517,213				7,647,519
Common shares outstanding at end of period			7,524,277				7,648,973
Performance Ratios
Return on average assets (annualized)			1.75	%			1.32	%
Return on average equity (annualized)			16.40	%			11.59	%
Return on average common equity (annualized)			17.71	%			12.19	%
Yield on earning assets (FTE) (2) (annualized)			6.37	%			4.49	%
Cost of interest bearing liabilities (annualized)			2.58	%			0.91	%
Net interest spread (FTE)(2)			3.79	%			3.58	%
Net interest margin (FTE)(2) (annualized)			4.69	%			3.93	%
Noninterest income as a percentage of average assets (annualized)			0.22	%			0.28	%
Noninterest expense to average assets (annualized)			2.52	%			2.19	%
Efficiency ratio(3)			52.97	%			54.79	%
Asset Quality
Allowance for credit losses (ACL)
Beginning balance, allowance for loan and lease losses (ALLL)		$	14,114			$	11,697
Add: recoveries			11				3
Less: charge-offs			—				—
Add: provision for loan losses			415				800
Add: current expected credit losses, nonrecurring adoption			895				—
Ending balance, ALLL		$	15,435			$	12,500
Beginning balance, reserve for unfunded commitment (RUC)		$	—			$	—
Add: current expected credit losses, nonrecurring adoption			1,310				—
Add: recovery of unfunded commitments			(132)				—
Ending balance, RUC		$	1,178			$	—
Total allowance for credit losses		$	16,613			$	12,500
Allowance for loan losses to total gross loans			0.94	%			0.87	%
Allowance for credit losses to total gross loans			1.01	%			0.87	%
Allowance for loan losses to non-performing assets			N/A				N/A
Net charge-offs (recoveries) to average gross loans (annualized)			0.00	%			0.00	%
Concentration Ratios
Commercial real estate loans to total capital (4)			372.12	%			370.35	%
Construction loans to total capital (5)			140.78	%			136.19	%
Nonperforming Assets
Loans 30-89 days past due to total gross loans			0.00	%			0.00	%
Loans 90 days past due to total gross loans			0.00	%			0.00	%
Non-accrual loans to total gross loans			0.00	%			0.00	%
Other real estate owned		$	—			$	—
Non-performing assets		$	—			$	—
Non-performing assets to total assets			0.00	%			0.00	%
Regulatory Capital Ratios (Bank only) (1)
Total risk-based capital ratio			16.35	%			16.44	%
Tier 1 risk-based capital ratio			15.49	%			15.63	%
Leverage ratio			14.69	%			14.47	%
Common equity tier 1 ratio			15.49	%			15.63	%
Other information
Closing stock price		$	23.49			$	24.31
Tangible equity / tangible assets (2)			9.51	%			10.52	%
Average tangible equity / average tangible assets (2)			10.22	%			11.25	%
Number of full time equivalent employees			170				141
# Full service branch offices			6				6

(1)	Regulatory capital ratios as of March 31, 2023 are preliminary
(2)	Refer to Appendix for reconciliation of non-GAAP measures
(3)	Efficiency ratio is calculated as non-interest expense as a percentage of net interest income and non-interest income
(4)	Commercial real estate includes only non-owner occupied and construction loans as a percentage of Bank capital
(5)	Construction loans as a percentage of Bank capital

 

Unaudited Reconciliation of Certain Non-GAAP Financial Measures
(Dollars In thousands)
		For the three months ended March 31,
		2023				2022
Net interest margin (FTE)
Net interest income (GAAP)		$	21,091			$	15,197
FTE adjustment on tax-exempt securities			70				72
Net interest income (FTE) (non-GAAP)			21,161				15,269
Average interest earning assets			1,828,300				1,574,435
Net interest margin (GAAP)			4.68 %				3.91 %
Net interest margin (FTE) (non-GAAP)			4.69 %				3.93 %

 

		For the three months ended March 31,
		2023				2022
Stockholders equity, adjusted
Total stockholders equity (GAAP)		$	204,988			$	188,796
Less: preferred stock			(27,263)				(27,263)
Total common stockholders equity (GAAP)			177,725				161,533
Less: intangible assets			10,559				3,906
Tangible common stockholders equity (non-GAAP)			167,166				157,627
Shares outstanding			7,524,277				7,648,973
Tangible book value per common share (non-GAAP)		$	(0.01)			$	(0.00)
		For the three months ended March 31,
		2023				2022
Stockholders equity, adjusted
Total stockholders equity (GAAP)		$	204,988			$	188,796
Less: intangible assets			(10,559)				(3,906)
Total tangible stockholders equity (non-GAAP)			194,429				184,890
		For the three months ended March 31,
		2023				2022
Total assets, adjusted
Total assets (GAAP)		$	2,056,494			$	1,761,748
Less: intangible assets			(10,559)				(3,906)
Total tangible assets (non-GAAP)			2,045,935				1,757,842
		For the three months ended March 31,
		2023				2022
Average stockholders equity, adjusted
Total average stockholders equity (GAAP)		$	201,603			$	189,709
Less: average intangible assets			(9,879)				(2,972)
Total average tangible stockholders equity (non-GAAP)			191,724				186,737
		For the three months ended March 31,
		2023				2022
Average assets, adjusted
Total average average assets (GAAP)		$	1,885,671			$	1,662,821
Less: average intangible assets			(9,879)				(2,972)
Total average tangible assets (non-GAAP)			1,875,792				1,659,849

 

 

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SOURCE MainStreet Bancshares, Inc.

FAQ

What were the net income results for MNSB in Q1 2023?

MainStreet Bancshares reported a record net income of $8.2 million for Q1 2023.

How did MainStreet Bancshares' loan portfolio perform in Q1 2023?

The loan portfolio grew 14.4% to $1.62 billion as of March 31, 2023.

What is the expected impact of Avenu™ on MNSB's finances?

Avenu™ is expected to accelerate deposit growth supporting expanded lending.

How did total deposits change for MNSB in Q1 2023?

Total deposits increased by 13.8% to $1.63 billion compared to the previous year.

What was the efficiency ratio for MNSB in Q1 2023?

The efficiency ratio for Q1 2023 was 53%, an improvement from 55% in Q1 2022.