27-01-2025
MainStreet Bancshares Inc. Reports 2024 Results
A challenging year, ending with strong and stable asset quality and strong capital
FAIRFAX, Va., Jan. 27, 2025 /PRNewswire/ -- MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the financial holding company for MainStreet Bank reported a loss of $9.98 million for 2024 resulting from the nonrecurring impairment of capitalized intangible software and the resolution of nonperforming assets. The Company remains strongly capitalized with good liquidity.
'At the end of 2024, the Company impaired the full value of its capitalized intangible software. Despite this impairment, the software remains a component of our Avenu Banking-as-a-Service solution and will continue to be used to drive fintech partnerships to grow low-cost deposits and fee income,' said Jeff W. Dick, Chairman & CEO of MainStreet Bancshares, Inc. and MainStreet Bank. 'The end of 2024 was management's first opportunity to review the Avenu platform's performance, as it was only put into production during the fourth quarter. The delays in bringing Avenu to market and subsequent changes in the potential for revenue generation necessitated management's review for impairment and resulting charge to earnings. Management conducted the impairment assessment in accordance with ASC 350-40-35, using the income approach. We remain committed to providing innovative embedded banking services that meet our customers where they do business and that allow developers to focus on providing leading-edge digital financial solutions.'
'During 2024, the Company ended the year with a healthy net interest margin of 3.13%,' said Alex Vari, Chief Accountant for MainStreet Bank. 'Excess liquidity in the fourth quarter gave us the opportunity to exercise call options on higher-yielding term deposits and restructure our wholesale deposit position. This will further reduce our funding costs into 2025, and with expense management efforts will yield positive results for the Company and for our shareholders.'
Chief Lending Officer Tom Floyd said, 'the lending team worked diligently to grow the loan portfolio by 6% while also resolving 62% of our nonperforming loans and making solid progress on resolving the final $21.7 million in a timely manner.'
Total deposits grew 13% from prior year-end to $1.9 billion, with core deposits growing $187 million year on year. Total core deposits at year-end were $1.4 billion, or 75% of total deposits.
'The DC Metropolitan area remains a vibrant market. The interest rate environment is normalizing, with the FOMC cutting rates three times thus far for a total of 1.0%,' said Abdul Hersiburane, President of MainStreet Bank. 'Our borrowers are benefiting from the declining rate environment with strengthening liquidity.'
BACKGROUND: MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), is a small-cap financial holding company trading in the Nasdaq Capital Market index. The financial holding company owns 100% of MainStreet Bank, a business-focused community bank headquartered in Fairfax, Virginia. The Bank engages a branch-lite model with six full-service financial centers 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 well over 1,000 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 Bank is an SBA Preferred Lender, offering 7A and 504 lending solutions. From sophisticated cash management to enhanced mobile banking and instant-issue Debit cards, MainStreet Bank is always looking for ways to improve our customer's experience.
MainStreet Bank was the first community bank in the Washington, D.C., metropolitan area to offer a full online business banking solution. MainStreet Bank was also the first bank headquartered in the Commonwealth of Virginia to offer CDARS – a solution that provides multi-million-dollar FDIC insurance. Further information on the Bank can be obtained by visiting its website at
Banking-as-a-Service
In 2021, the Board and management decided to make an investment in technology that would best serve clients requiring Banking-as-a-Service (BaaS). The Avenu BaaS solution officially launched on October 1, 2024. The ability to digitally offer banking services in a safe and compliant manner allows the Company to reach new customer deposit segments, diversify revenue streams and generate additional income. The BaaS market is currently underserved, and the opportunities for a well-developed solution are robust. The Avenu business model is in-line with the Company's physical branch-lite strategy.
Avenu provides a full-stack embedded banking solution that connects our partners and their apps directly and seamlessly to our purpose-built Avenu core. Avenu's clients are fintechs, social media solutions, application developers, money movers, and entrepreneurs. They all have one thing in common: They are in search of a reliable partner to help innovate how money moves - solving real-world issues and helping communities thrive. MainStreet Bank is that reliable partner dedicated to providing a best-in-class solution to sustain long-term business relationships.
MainStreet Bancshares, Inc. has an investment grade rating of 'A' from Egan-Jones Rating Company. 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 pandemic outbreaks, 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.
UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION
(In thousands)
December
31, 2024
September
30, 2024
June 30,
2024
March 31,
2024
December
31, 2023*
ASSETS
Cash and cash equivalents
Cash and due from banks
$
47,553
$
40,955
$
41,697
$
49,208
$
53,581
Federal funds sold
160,155
191,159
49,762
75,533
60,932
Total cash and cash equivalents
207,708
232,114
91,459
124,741
114,513
Investment securities available for sale, at fair value
55,747
58,489
57,605
58,699
59,928
Investment securities held to maturity, at amortized cost, net of allowance for credit losses of $0 for all periods
16,078
16,016
16,036
17,251
17,275
Restricted equity securities, at amortized cost
30,623
26,745
26,797
23,924
24,356
Loans, net of allowance for credit losses of $19,450, $18,327, $17,098, $16,531, and $16,506, respectively
1,810,556
1,775,558
1,778,840
1,727,110
1,705,137
Premises and equipment, net
13,287
13,571
13,787
14,081
13,944
Accrued interest and other receivables
11,311
11,077
11,916
10,727
12,390
Computer software, net of amortization
—
18,881
17,205
15,691
14,657
Bank owned life insurance
39,507
39,203
38,901
38,609
38,318
Other assets
43,281
32,945
41,200
39,182
34,914
Total Assets
$
2,228,098
$
2,224,599
$
2,093,746
$
2,070,015
$
2,035,432
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Non-interest bearing deposits
$
324,307
$
347,575
$
314,636
$
348,945
$
364,606
Interest bearing demand deposits
139,780
197,527
179,513
165,331
137,128
Savings and NOW deposits
64,337
61,893
60,867
46,036
45,878
Money market deposits
560,082
451,936
476,396
446,903
442,179
Time deposits
819,288
834,738
723,951
725,520
696,336
Total deposits
1,907,794
1,893,669
1,755,363
1,732,735
1,686,127
Federal funds purchased
—
—
—
—
15,000
Subordinated debt
73,039
72,940
72,841
72,741
72,642
Other liabilities
39,274
31,939
40,827
41,418
40,146
Total Liabilities
2,020,107
1,998,548
1,869,031
1,846,894
1,813,915
Stockholders' Equity:
Preferred stock
27,263
27,263
27,263
27,263
27,263
Common stock
29,466
29,463
29,452
29,514
29,198
Capital surplus
67,823
67,083
66,392
65,940
65,985
Retained earnings
91,150
108,616
109,651
108,334
106,549
Accumulated other comprehensive loss
(7,711)
(6,374)
(8,043)
(7,930)
(7,478)
Total Stockholders' Equity
207,991
226,051
224,715
223,121
221,517
Total Liabilities and Stockholders' Equity
$
2,228,098
$
2,224,599
$
2,093,746
$
2,070,015
$
2,035,432
*Derived from audited financial statements
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION
(In thousands, except share and per share data)
Year-to-Date
Three Months Ended
December
31, 2024
December
31, 2023*
December
31, 2024
September
30, 2024
June 30,
2024
March 31,
2024
December
31, 2023
INTEREST INCOME:
Interest and fees on loans
$
125,177
$
116,482
$
31,323
$
31,615
$
31,655
$
30,582
$
30,951
Interest on investment securities
Taxable securities
1,693
1,836
431
397
430
435
451
Tax-exempt securities
1,093
1,065
262
294
268
270
268
Interest on federal funds sold
6,652
5,038
3,103
1,285
1,083
1,182
1,510
Total interest income
134,615
124,421
35,119
33,591
33,436
32,469
33,180
INTEREST EXPENSE:
Interest on interest bearing demand deposits
8,661
1,786
2,612
2,117
2,118
1,814
1,027
Interest on savings and NOW deposits
754
546
201
206
190
157
146
Interest on money market deposits
21,386
13,631
5,475
5,277
5,542
5,092
5,538
Interest on time deposits
37,364
26,905
10,003
9,543
9,010
8,808
8,187
Interest on federal funds purchased
575
299
—
277
191
107
25
Interest on Federal Home Loan Bank advances
46
1,224
—
—
—
46
118
Interest on subordinated debt
3,255
3,288
787
828
820
820
828
Total interest expense
72,041
47,679
19,078
18,248
17,871
16,844
15,869
Net interest income
62,574
76,742
16,041
15,343
15,565
15,625
17,311
Provision for (recovery of) credit losses
6,763
1,642
3,407
2,913
638
(195)
466
Net interest income after provision for (recovery of) credit losses
55,811
75,100
12,634
12,430
14,927
15,820
16,845
NON-INTEREST INCOME:
Deposit account service charges
1,996
2,149
481
557
490
469
510
Bank owned life insurance income
1,189
1,069
304
302
291
292
283
Net loss on securities called or matured
(48)
—
—
—
(48)
—
—
Other non-interest income (loss)
115
122
22
27
31
35
(34)
Total non-interest income
3,252
3,340
807
886
764
796
759
NON-INTEREST EXPENSES:
Salaries and employee benefits
30,475
28,267
8,253
7,250
7,484
7,488
7,129
Furniture and equipment expenses
3,636
2,787
830
931
940
935
804
Advertising and marketing
2,199
2,343
600
579
566
454
271
Occupancy expenses
1,614
1,684
358
407
415
435
397
Outside services
3,627
2,044
1,168
845
839
774
352
Administrative expenses
929
922
243
215
229
242
219
Computer software intangible impairment
19,721
—
19,721
—
—
—
—
Other operating expenses
10,766
7,569
3,258
2,992
2,362
2,153
2,166
Total non-interest expenses
72,967
45,616
34,431
13,219
12,835
12,481
11,338
Income (loss) before income tax expense (benefit)
(13,904)
32,824
(20,990)
97
2,856
4,135
6,266
Income tax expense (benefit)
(3,924)
6,239
(4,823)
(168)
238
830
1,120
Net income (loss)
(9,980)
26,585
(16,167)
265
2,618
3,305
5,146
Preferred stock dividends
2,156
2,156
539
539
539
539
539
Net income (loss) available to common shareholders
$
(12,136)
$
24,429
$
(16,706)
$
(274)
$
2,079
$
2,766
$
4,607
Earnings (loss) per common share, basic and diluted
$
(1.60)
$
3.25
$
(2.20)
$
(0.04)
$
0.27
$
0.36
$
0.61
Weighted average number of common shares, basic and diluted
7,606,391
7,522,913
7,603,318
7,601,925
7,608,389
7,611,990
7,527,327
*Derived from audited financial statements
UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL
(In thousands)
December 31, 2024
September 30, 2024
December 31, 2023
Percentage Change
$ Amount
% of
Total
$ Amount
% of
Total
$ Amount
% of
Total
Last 3
Mos
Last 12
Mos
LOANS:
Construction and land development loans
$
391,253
21.3
%
$
373,486
20.8
%
$
429,637
24.9
%
4.8
%
-8.9
%
Residential real estate loans
438,745
23.9
%
446,109
24.8
%
474,602
27.5
%
-1.7
%
-7.6
%
Commercial real estate loans
898,204
48.9
%
871,280
48.4
%
743,827
43.1
%
3.1
%
20.8
%
Commercial and industrial loans
105,212
5.7
%
106,249
5.9
%
75,415
4.3
%
-1.0
%
39.5
%
Consumer loans
1,574
0.2
%
1,977
0.1
%
3,610
0.2
%
-20.4
%
-56.4
%
Total Gross Loans
$
1,834,988
100.0
%
$
1,799,101
100.0
%
$
1,727,091
100.0
%
2.0
%
6.2
%
Less: Allowance for credit losses
(19,450)
(18,327)
(16,506)
Net deferred loan fees
(4,982)
(5,216)
(5,448)
Net Loans
$
1,810,556
$
1,775,558
$
1,705,137
DEPOSITS:
Non-interest bearing deposits
$
324,307
17.0
%
$
347,575
18.4
%
$
364,606
21.6
%
-6.7
%
-11.1
%
Interest-bearing deposits:
Demand deposits
139,780
7.3
%
197,527
10.4
%
137,128
8.1
%
-29.2
%
1.9
%
Savings and NOW deposits
64,337
3.4
%
61,893
3.3
%
45,878
2.7
%
3.9
%
40.2
%
Money market deposits
560,082
29.4
%
451,936
23.9
%
442,179
26.2
%
23.9
%
26.7
%
Certificates of deposit $250,000 or more
535,676
28.0
%
532,201
28.0
%
442,662
26.3
%
0.7
%
21.0
%
Certificates of deposit less than $250,000
283,612
14.9
%
302,537
16.0
%
253,674
15.1
%
-6.3
%
11.8
%
Total Deposits
$
1,907,794
100.0
%
$
1,893,669
100.0
%
$
1,686,127
100.0
%
0.7
%
13.1
%
BORROWINGS:
Federal funds purchased
—
0.0
%
—
0.0
%
15,000
17.1
%
0.0
%
-100.0
%
Subordinated debt
73,039
100.0
%
72,940
100.0
%
72,642
82.9
%
0.1
%
0.5
%
Total Borrowings
$
73,039
100.0
%
$
72,940
100.0
%
$
87,642
100.0
%
0.1
%
-16.7
%
Total Deposits and Borrowings
$
1,980,833
$
1,966,609
$
1,773,769
0.7
%
11.7
%
Core customer funding sources (1)
$
1,439,657
72.7
%
$
1,471,350
74.8
%
$
1,252,534
70.7
%
-2.2
%
14.9
%
Brokered and listing service sources (2)
468,137
23.6
%
422,319
21.5
%
433,593
24.4
%
10.8
%
8.0
%
Federal funds purchased
—
0.0
%
—
0.0
%
15,000
0.8
%
0.0
%
-100.0
%
Subordinated debt (3)
73,039
3.7
%
72,940
3.7
%
72,642
4.1
%
0.1
%
0.5
%
Total Funding Sources
$
1,980,833
100.0
%
$
1,966,609
100.0
%
$
1,773,769
100.0
%
0.7
%
11.7
%
(1)
Includes ICS, CDARS, and reciprocal deposits maintained by customers, which represent sweep accounts tied to customer operating accounts.
(2)
Consists of certificates of deposit (CD) through multiple listing services and multiple brokered deposit services, as well as ICS and CDARS one-way certificates of deposit and regional money market accounts.
Excludes $259.9 million in core deposits placed in reciprocal networks for FDIC insurance coverage that will be classified as brokered deposits on the call report in pursuant to rule 12 CFR 337.6(e) as of December 31, 2024.
(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 December 31,
2024
For the three months ended December 31,
2023
Average
Balance
Interest
Income/
Expense
(3)(4)
Average
Yields/ Rate
(annualized)
(3)(4)
Average
Balance
Interest
Income/
Expense
(3)(4)
Average
Yields/ Rate
(annualized)
(3)(4)
ASSETS:
Interest-earning assets:
Loans (1)(2)
$
1,808,894
$
31,323
6.87
%
$
1,720,790
$
30,951
7.14
%
Securities:
Taxable
53,566
431
3.19
%
55,646
451
3.22
%
Tax-exempt
35,512
332
3.71
%
37,614
339
3.58
%
Federal funds and interest-bearing deposits
263,595
3,103
4.67
%
114,421
1,510
5.24
%
Total interest-earning assets
$
2,161,567
$
35,189
6.46
%
$
1,928,471
$
33,251
6.84
%
Other assets
129,077
69,725
Total assets
$
2,290,644
$
1,998,196
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits
$
231,496
$
2,612
4.48
%
$
98,021
$
1,027
4.16
%
Savings and NOW deposits
64,112
201
1.24
%
47,142
146
1.23
%
Money market deposits
514,235
5,475
4.22
%
477,916
5,538
4.60
%
Time deposits
809,924
10,003
4.90
%
710,026
8,187
4.57
%
Total interest-bearing deposits
$
1,619,767
$
18,291
4.48
%
$
1,333,105
$
14,898
4.43
%
Federal funds purchased
2
—
0.00
%
1,740
25
5.70
%
FHLB advances
—
—
—
8,424
118
5.56
%
Subordinated debt
73,001
787
4.28
%
72,603
828
4.52
%
Total interest-bearing liabilities
$
1,692,770
$
19,078
4.47
%
$
1,415,872
$
15,869
4.45
%
Demand deposits and other liabilities
370,332
365,655
Total liabilities
$
2,063,102
$
1,781,527
Stockholders' Equity
227,542
216,669
Total Liabilities and Stockholders' Equity
$
2,290,644
$
1,998,196
Interest Rate Spread
1.99
%
2.39
%
Net Interest Income
$
16,111
$
17,382
Net Interest Margin
2.96
%
3.58
%
(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 AVERAGE BALANCE SHEETS, INTEREST AND RATES
(In thousands)
For the year ended December 31, 2024
For the year ended December 31, 2023
Average
Balance
Interest
Income/
Expense
(3)(4)
Average
Yields/ Rate
(annualized)
(3)(4)
Average
Balance
Interest
Income/
Expense
(3)(4)
Average
Yields/ Rate
(annualized)
(3)(4)
ASSETS:
Interest-earning assets:
Loans (1)(2)
$
1,782,061
$
125,177
7.02
%
$
1,659,179
$
116,482
7.02
%
Securities:
Taxable
54,935
1,693
3.08
%
57,386
1,836
3.20
%
Tax-exempt
36,379
1,384
3.80
%
37,810
1,348
3.57
%
Federal funds and interest-bearing deposits
137,073
6,652
4.85
%
103,840
5,038
4.85
%
Total interest-earning assets
$
2,010,448
$
134,906
6.71
%
$
1,858,215
$
124,704
6.71
%
Other assets
126,138
73,590
Total assets
$
2,136,586
$
1,931,805
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits
$
181,109
$
8,661
4.78
%
$
83,087
$
1,786
2.15
%
Savings and NOW deposits
54,385
754
1.39
%
49,565
546
1.10
%
Money market deposit
464,400
21,386
4.61
%
365,815
13,631
3.73
%
Time deposits
748,938
37,364
4.99
%
702,034
26,905
3.83
%
Total interest-bearing deposits
$
1,448,832
$
68,165
4.70
%
$
1,200,501
$
42,868
3.57
%
Federal funds purchased
9,941
575
5.78
%
5,583
299
5.36
%
FHLB advances
820
46
5.61
%
24,959
1,224
4.90
%
Subordinated debt
72,852
3,255
4.47
%
72,455
3,288
4.54
%
Total interest-bearing liabilities
$
1,532,445
$
72,041
4.70
%
$
1,303,498
$
47,679
3.66
%
Demand deposits and other liabilities
379,510
418,386
Total liabilities
$
1,911,955
$
1,721,884
Stockholders' Equity
224,631
209,921
Total Liabilities and Stockholders' Equity
$
2,136,586
$
1,931,805
Interest Rate Spread
2.01
%
3.05
%
Net Interest Income
$
62,865
$
77,025
Net Interest Margin
3.13
%
4.15
%
(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 share and per share data)
At or For the Three
Months Ended
At or For the Year Ended
December 31,
December 31,
2024
2023
2024
2023
Per share Data and Shares Outstanding
Earnings (loss) per common share (basic and diluted)
$
(2.20)
$
0.61
$
(1.60)
$
3.25
Book value per common share
$
23.77
$
25.81
$
23.77
$
25.81
Tangible book value per common share(2)
$
23.77
$
23.86
$
23.77
$
23.86
Weighted average common shares (basic and diluted)
7,603,318
7,527,327
7,606,391
7,522,913
Common shares outstanding at end of period
7,603,765
7,527,415
7,603,765
7,527,415
Performance Ratios
Return (loss) on average assets (annualized)
(2.80)
%
1.02
%
(0.47)
%
1.38
%
Return (loss) on average equity (annualized)
(28.19)
%
9.42
%
(4.44)
%
12.66
%
Return (loss) on average common equity (annualized)
(33.09)
%
10.28
%
(6.15)
%
13.37
%
Yield on earning assets (FTE) (2) (annualized)
6.46
%
6.84
%
6.71
%
6.71
%
Cost of interest bearing liabilities (annualized)
4.47
%
4.45
%
4.70
%
3.66
%
Net interest spread (FTE)(2) (annualized)
1.99
%
2.39
%
2.01
%
3.05
%
Net interest margin (FTE)(2) (annualized)
2.96
%
3.58
%
3.13
%
4.15
%
Non-interest income as a percentage of average assets (annualized)
0.14
%
0.17
%
0.15
%
0.17
%
Non-interest expense to average assets (annualized)
5.96
%
2.21
%
3.42
%
2.36
%
Efficiency ratio(3)
204.36
%
61.29
%
110.85
%
56.96
%
Asset Quality
Allowance for credit losses (ACL)
Beginning balance, ACL - loans
$
18,327
$
15,626
$
16,506
$
14,114
Add: recoveries
9
9
28
22
Less: charge-offs
(2,151)
(137)
(4,569)
(468)
Add: provision for (recovery of) credit losses - loans
3,265
1,008
7,485
1,943
Add: current expected credit losses, nonrecurring adoption
—
—
—
895
Ending balance, ACL - loans
$
19,450
$
16,506
$
19,450
$
16,506
Beginning balance, reserve for unfunded commitment (RUC)
$
145
$
1,552
$
1,009
$
—
Add: current expected credit losses, nonrecurring adoption
—
—
—
1,310
Add: provision for (recovery of) unfunded commitments, net
142
(543)
(722)
(301)
Ending balance, RUC
$
287
$
1,009
$
287
$
1,009
Total allowance for credit losses
$
19,737
$
17,515
$
19,737
$
17,515
Allowance for credit losses on loans to total gross loans
1.06
%
0.96
%
1.06
%
0.96
%
Allowance for credit losses to total gross loans
1.08
%
1.01
%
1.08
%
1.01
%
Allowance for credit losses on loans to non-performing loans
89.84
%
16.44X
89.84
%
16.44X
Net charge-offs (recoveries) to average gross loans (annualized)
0.46
%
0.03
%
0.25
%
0.03
%
Concentration Ratios
Commercial real estate loans to total capital (4)
393.79
%
372.50
%
393.79
%
372.50
%
Construction loans to total capital (5)
131.92
%
137.67
%
131.92
%
137.67
%
Non-performing Assets
Loans 30-89 days past due and accruing to total gross loans
0.00
%
0.04
%
0.00
%
0.04
%
Loans 90 days past due and accruing to total gross loans
0.00
%
0.00
%
0.00
%
0.00
%
Non-accrual loans to total gross loans
1.18
%
0.06
%
1.18
%
0.06
%
Other real estate owned
$
—
$
—
$
—
$
—
Non-performing loans
$
21,650
$
1,004
$
21,650
$
1,004
Non-performing assets to total assets
0.97
%
0.05
%
0.97
%
0.05
%
Regulatory Capital Ratios (Bank only) (1)
Total risk-based capital ratio
15.69
%
17.18
%
15.69
%
17.18
%
Tier 1 risk-based capital ratio
14.64
%
16.22
%
14.64
%
16.22
%
Leverage ratio
12.08
%
14.66
%
12.08
%
14.66
%
Common equity tier 1 ratio
14.64
%
16.22
%
14.64
%
16.22
%
Other information
Closing stock price
$
18.10
$
24.81
$
18.10
$
24.81
Tangible equity / tangible assets (2)
9.33
%
10.24
%
9.33
%
10.24
%
Average tangible equity / average tangible assets (2)
9.21
%
10.22
%
9.80
%
10.31
%
Number of full time equivalent employees
204
186
204
186
Number of full service branch offices
6
6
6
6
(1)
Regulatory capital ratios as of December 31, 2024 are preliminary
(2)
Refer to Appendix for reconciliation of non-GAAP measures
(3)
Efficiency ratio is calculated as non-interest expense as a percentage of net interest income and non-interest income
(4)
Commercial real estate includes only non-owner occupied, multifamily, 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 December 31,
For the year ended
December 31,
2024
2023
2024
2023
Net interest margin (FTE)
Net interest income (GAAP)
$
16,041
$
17,311
$
62,574
$
76,742
FTE adjustment on tax-exempt securities
70
71
291
283
Net interest income (FTE) (non-GAAP)
16,111
17,382
62,865
77,025
Average interest earning assets
2,161,567
1,928,471
2,010,448
1,858,215
Net interest margin (GAAP)
2.94
%
3.56
%
3.11
%
4.13
%
Net interest margin (FTE) (non-GAAP)
2.96
%
3.58
%
3.13
%
4.15
%
For the three months
ended December 31,
For the year ended
December 31,
2024
2023
2024
2023
Yield on earning assets (FTE)
Total interest income (GAAP)
$
35,119
$
33,180
$
134,615
$
124,421
FTE adjustment on tax-exempt securities
70
71
291
283
Total interest income (FTE) (non-GAAP)
35,189
33,251
134,906
124,704
Average interest earning assets
2,161,567
1,928,471
2,010,448
1,858,215
Yield on earning assets (GAAP)
6.45
%
6.83
%
6.70
%
6.70
%
Yield on earning assets (FTE) (non-GAAP)
6.46
%
6.84
%
6.71
%
6.71
%
For the three months
ended December 31,
For the year ended
December 31,
2024
2023
2024
2023
Net Income and earnings per share, adjusted
Net Income (loss), as reported
$
(16,167)
$
5,146
$
(9,980)
$
26,585
Less: nonrecurring intangible impairment
(19,721)
—
(19,721)
—
Less: nonrecurring restructuring expenses
(430)
—
(430)
—
Less: nonrecurring other expenses
(296)
—
(890)
—
Net income (loss), adjusted
(353)
5,146
6,298
26,585
Preferred stock dividends
539
539
2,156
2,156
Net income (loss) available to common shareholders, adjusted
(892)
4,607
4,142
24,429
Weighted average shares - basic and diluted
7,603,318
7,527,327
7,606,391
7,522,913
Earnings (loss) per common share, basic and diluted, adjusted
Earnings (loss) per common share, basic and diluted, as reported
$
(2.20)
$
0.61
$
(1.60)
$
3.25
Nonrecurring expenses per share, net of taxes
2.08
—
2.14
—
Earnings (loss) per common share, basic and diluted, adjusted
$
(0.12)
$
0.61
$
0.54
$
3.25
Adjusted Return (loss) on Average Assets (ROAA)
Average assets, as reported
2,290,644
1,998,196
2,136,586
1,931,805
Annualized ROAA, as reported
(2.80)
%
1.02
%
(0.47)
%
1.38
%
Annualized ROAA, as adjusted
(0.06)
%
1.02
%
0.29
%
1.38
%
Adjusted Return (loss) on Average Equity (ROAE)
Average equity, as reported
227,542
216,669
224,631
209,921
Annualized ROAE, as reported
(28.19)
%
9.42
%
(4.44)
%
12.66
%
Annualized ROAE, as adjusted
(0.62)
%
9.42
%
2.80
%
12.66
%
Efficiency Ratio, adjusted
Noninterest expenses, as reported
34,431
11,338
72,967
45,616
Less: nonrecurring intangible impairment
(19,721)
—
(19,721)
—
Less: nonrecurring restructuring expenses
(430)
—
(430)
—
Less: nonrecurring other expenses
(296)
—
(890)
—
Noninterest expenses, adjusted for nonrecurring expenses
13,984
11,338
51,926
45,616
Efficiency ratio, as reported
204.36
%
61.29
%
110.85
%
56.96
%
Efficiency ratio, as adjusted
83.00
%
61.29
%
78.88
%
56.96
%
For the three months
ended December 31,
For the year ended
December 31,
2024
2023
2024
2023
Net interest spread (FTE)
Yield on earning assets (GAAP)
6.45
%
6.83
%
6.70
%
6.70
%
Yield on earning assets (FTE) (non-GAAP)
6.46
%
6.84
%
6.71
%
6.71
%
Yield on interest-bearing liabilities (GAAP)
4.47
%
4.45
%
4.70
%
3.66
%
Net interest spread (GAAP)
1.98
%
2.38
%
1.99
%
3.04
%
Net interest spread (FTE) (non-GAAP)
1.99
%
2.39
%
2.01
%
3.05
%
As of December 31,
As of December 31,
2024
2023
2024
2023
Tangible common stockholders' equity
Total stockholders equity (GAAP)
$
207,991
$
221,517
$
207,991
$
221,517
Less: intangible assets
—
(14,657)
—
(14,657)
Tangible stockholders' equity (non-GAAP)
207,991
206,860
207,991
206,860
Less: preferred stock
(27,263)
(27,263)
(27,263)
(27,263)
Tangible common stockholders' equity (non-GAAP)
180,728
179,597
180,728
179,597
Common shares outstanding
7,603,765
7,527,415
7,603,765
7,527,415
Tangible book value per common share (non-GAAP)
$
23.77
$
23.86
$
23.77
$
23.86
As of December 31,
As of December 31,
2024
2023
2024
2023
Stockholders equity, adjusted
Total stockholders equity (GAAP)
$
207,991
$
221,517
$
207,991
$
221,517
Less: intangible assets
—
(14,657)
—
(14,657)
Total tangible stockholders equity (non-GAAP)
207,991
206,860
207,991
206,860
As of December 31,
As of December 31,
2024
2023
2024
2023
Total tangible assets
Total assets (GAAP)
$
2,228,098
$
2,035,432
$
2,228,098
$
2,035,432
Less: intangible assets
—
(14,657)
—
(14,657)
Total tangible assets (non-GAAP)
2,228,098
2,020,775
2,228,098
2,020,775
For the three months
ended December 31,
For the year ended
December 31,
2024
2023
2024
2023
Average tangible stockholders' equity
Total average stockholders' equity (GAAP)
$
227,542
$
216,669
$
224,631
$
209,921
Less: average intangible assets
(18,327)
(13,929)
(16,989)
(11,996)
Total average tangible stockholders' equity (non-GAAP)
209,215
202,740
207,642
197,925
For the three months
ended December 31,
For the year ended
December 31,
2024
2023
2024
2023
Average tangible assets
Total average assets (GAAP)
$
2,290,644
$
1,998,196
$
2,136,586
$
1,931,805
Less: average intangible assets
(18,327)
(13,929)
(16,989)
(11,996)
Total average tangible assets (non-GAAP)
2,272,317
1,984,267
2,119,597
1,919,809
Contact: Billy Freesmeier
Chief of Staff
Desk (703) 481-4579
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