MainStreet Bancshares Inc. Delivered Consistent 2023 Earnings Despite Market Turmoil

Year-End and Fourth Quarter Results Underscore Steady Progress in Challenging Environment

FAIRFAX, Va., Jan. 22, 2024 /PRNewswire/ -- MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the holding company for MainStreet Bank, reported net income of $26.6 million for the year ended December 31, 2023, consistent with expectations. Earnings per share for the year totaled $3.25.

MainStreet Bancshares, Inc. Logo

Annualized returns for 2023 included:

Return on Average Equity (ROAE):	12.66 %
Return on Average Assets (ROAA):	1.38 %
Net Interest Margin (NIM) (tax equivalent):	4.08 %
Efficiency Ratio:	56.7 %
Liquidity Coverage Ratio:	133 %
Core Deposit Ratio:	74 %
FDIC Insured Deposits / Total Deposits:	77 %
Allowance for Credit Losses (ACL):	1.01 %
Tangible Book Value per Common Share:	$23.86

"We've maintained a steady course, meeting customer credit needs and delivering healthy shareholder value at a time when community banks across our region and the nation face intense headwinds," said Jeff W. Dick, Chairman and CEO of MainStreet Bancshares Inc. and MainStreet Bank.

"It's worth reflecting on what an extraordinarily challenging year this was," he continued. "In the first quarter of 2023, we witnessed the second, third, and fourth largest bank failures in U.S. history. The fallout increased the impact of historically steep interest rate hikes. Yet MainStreet Bancshares has not just persevered but prospered. We see a bright future for all facets of our business, and we continue to invest in innovation as our Avenu embedded banking solution comes to fruition."

Strong Fundamentals
"Our core banking business is thriving," added Abdul Hersiburane, MainStreet Bank's President. "Core deposits rose to 74% in the fourth quarter, up from 68% in the third quarter, and in the same period our wholesale deposits declined from 31% to 24%. Net loans, meanwhile, were up 8% for the year."

The Company's loan book totaled $1.73 billion at the end of 2023, and concentrations are well managed, with commercial real estate standing at 373% of total capital, below the board-set limit of 375%. The quality of the loan portfolio remained pristine, with negligible net chargeoffs and past-due loans.

The cumulative net interest margin rested at 4.08% for the year, as funding costs began to stabilize. While this measure has trended down quarter over quarter, the Company's levels have consistently remained higher than most of its peers due to strong balance sheet management.

Fortifying Avenu for Growth
Since it went live in the third quarter, Avenu has continued to make progress in attracting and onboarding customers. Its inaugural client, Safari Pay, has now entered the beta stage and is gradually adding customers and conducting transactions. As Avenu ramps up and begins compliance reviews and onboarding with additional customers, the team will continue to harden and test systems and fortify the operation to scale up.

"We set out to build from scratch a compliance-centric system that can connect our partners and their apps directly and seamlessly to MainStreet Bank's banking core," Dick noted. "This was never a modest task because we weren't interested in jumping onboard the middleware bandwagon. We wanted to build our embedded banking solution with meticulous care, bringing our deep understanding of regulatory and business challenges to bear. We are confident that our embedded banking solution will prove innovative and enhance MainStreet Bank's deposit growth and support expanded lending."

ABOUT AVENU
Avenu, MainStreet Bank's fully integrated Software as a Service (SaaS) solution, identified its first client on October 18. SafariPay, via its global money transmittance service PaySii, expects its customers to maintain average balances of $4 million on the platform.

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 CDARS – a solution that provides multi-million-dollar FDIC insurance. Further information on the Bank can be obtained by visiting its website at mstreetbank.com.

This release contains forward-looking statements, including our expectations with respect to future events that are subject to various risks and uncertainties. The statements contained in this release that are not historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Words such as "may," "will," "could," "should," "expect," "plan," "project," "intend," "anticipate," "believe," "estimate," "predict," "potential," "pursuant," "target," "continue," and similar expressions are intended to identify such forward-looking statements. Factors that could cause actual results to differ materially from management's projections, forecasts, estimates and expectations include: fluctuation in market rates of interest and loan and deposit pricing, adverse changes in the overall national economy as well as adverse economic conditions in our specific market areas, future impacts of the novel coronavirus (COVID-19) outbreak, maintenance and development of well-established and valued client relationships and referral source relationships, and acquisition or loss of key production personnel. We caution readers that the list of factors above is not exclusive. The forward-looking statements are made as of the date of this release, and we may not undertake steps to update the forward-looking statements to reflect the impact of any circumstances or events that arise after the date the forward-looking statements are made. In addition, our past results of operations are not necessarily indicative of future performance.

 

MainStreet Bancshares, Inc.
UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION
(In thousands)
		December 31, 2023				September 30, 2023				June 30, 2023				March 31, 2023				December 31, 2022*
ASSETS
Cash and cash equivalents
Cash and due from banks		$	53,581			$	44,912			$	67,700			$	225,334			$	48,931
Federal funds sold			60,932				76,271				30,341				—				81,669
Total cash and cash equivalents			114,513				121,183				98,041				225,334				130,600
Investment securities available for sale, at fair value			59,928				56,726				60,579				63,209				62,631
Investment securities held to maturity, at amortized cost, net of allowance for credit losses of $0 for all periods			17,275				17,565				17,590				17,616				17,642
Restricted equity securities, at amortized cost			24,356				20,619				20,304				22,436				24,325
Loans, net of allowance for credit losses of $16,506, $15,626, $16,047, $15,435, and $14,114, respectively			1,705,137				1,681,444				1,637,484				1,617,275				1,579,950
Premises and equipment, net			13,944				14,275				14,427				14,521				14,709
Accrued interest and other receivables			12,390				11,184				10,256				9,744				9,581
Computer software, net of amortization			14,657				13,373				12,266				10,559				9,149
Bank owned life insurance			38,318				38,035				37,763				37,503				37,249
Other assets			34,914				47,087				40,641				36,811				39,915
Total Assets		$	2,035,432			$	2,021,491			$	1,949,351			$	2,055,008			$	1,925,751
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Non-interest bearing deposits		$	364,606			$	394,859			$	388,992			$	487,875			$	550,690
Interest bearing demand deposits			137,128				76,423				71,308				100,522				80,099
Savings and NOW deposits			45,878				46,550				51,294				53,499				51,419
Money market deposits			442,179				461,398				380,500				260,316				222,540
Time deposits			696,336				703,960				701,289				730,076				608,141
Total deposits			1,686,127				1,683,190				1,593,383				1,632,288				1,512,889
Federal funds borrowed			15,000				—				30,000				60,696				—
Federal Home Loan Bank advances			—				—				—				45,000				100,000
Subordinated debt			72,642				72,543				72,444				72,344				72,245
Other liabilities			40,146				52,015				43,016				39,692				42,335
Total Liabilities			1,813,915				1,807,748				1,738,843				1,850,020				1,727,469
Stockholders' Equity:
Preferred stock			27,263				27,263				27,263				27,263				27,263
Common stock			29,198				29,188				29,177				29,185				28,736
Capital surplus			65,985				65,407				64,768				64,213				63,999
Retained earnings			106,549				102,694				97,646				91,991				86,830
Accumulated other comprehensive loss			(7,478)				(10,809)				(8,346)				(7,664)				(8,546)
Total Stockholders' Equity			221,517				213,743				210,508				204,988				198,282
Total Liabilities and Stockholders' Equity		$	2,035,432			$	2,021,491			$	1,949,351			$	2,055,008			$	1,925,751

*Derived from audited financial statements

 

MainStreet Bancshares, Inc.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION
(In thousands, except share and per share data)
		Year-to-Date								Three Months Ended
		December 31, 2023				December 31, 2022				December 31, 2023				September 30, 2023				June 30, 2023				March 31, 2023				December 31, 2022
INTEREST INCOME:
Interest and fees on loans		$	116,184			$	78,872			$	30,849			$	29,750			$	28,855			$	26,731			$	23,972
Interest on investment securities
Taxable securities			1,836				1,603				451				459				407				518				467
Tax-exempt securities			1,065				1,058				268				268				265				264				262
Interest on federal funds sold			5,038				2,312				1,510				1,217				1,179				1,132				1,071
Total interest income			124,123				83,845				33,078				31,694				30,706				28,645				25,772
INTEREST EXPENSE:
Interest on interest bearing demand deposits			1,892				601				1,058				240				251				343				256
Interest on savings and NOW deposits			546				203				146				145				147				108				81
Interest on money market deposits			13,924				1,547				5,639				4,156				2,926				1,203				781
Interest on time deposits			27,003				8,202				8,257				7,526				7,077				4,144				2,966
Interest on federal funds borrowed			299				—				25				35				201				38				—
Interest on Federal Home Loan Bank advances			1,224				347				118				186				13				906				264
Interest on subordinated debt			3,288				2,936				828				828				820				812				828
Total interest expense			48,176				13,836				16,071				13,116				11,435				7,554				5,176
Net interest income			75,947				70,009				17,007				18,578				19,271				21,091				20,596
Provision for credit losses			1,642				2,398				466				255				638				283				1,118
Net interest income after provision for credit losses			74,305				67,611				16,541				18,323				18,633				20,808				19,478
NON-INTEREST INCOME:
Deposit account service charges			2,149				2,420				510				514				535				590				610
Bank owned life insurance income			1,069				1,008				283				272				259				255				253
Loan swap fee income			—				619				—				—				—				—				—
Net gain on held-to-maturity securities			—				4				—				—				—				—				—
Net loss on sale of loans			—				(168)				—				—				—				—				—
Other non-interest income			420				951				68				177				16				158				196
Total other income			3,638				4,834				861				963				810				1,003				1,059
NON-INTEREST EXPENSES:
Salaries and employee benefits			28,267				23,801				7,129				6,924				6,595				7,621				...6,775
Furniture and equipment expenses			2,787				2,786				804				713				772				498				710
Advertising and marketing			2,343				2,304				271				577				698				797				620
Occupancy expenses			1,684				1,471				397				375				426				486				378
Outside services			2,044				2,075				352				697				504				490				529
Administrative expenses			922				872				219				277				211				215				214
Other operating expenses			7,072				5,748				1,964				1,866				1,646				1,596				1,481
Total non-interest expenses			45,119				39,057				11,136				11,429				10,852				11,703				10,707
Income before income tax expense			32,824				33,388				6,266				7,857				8,591				10,108				9,830
Income tax expense			6,239				6,714				1,120				1,516				1,645				1,957				2,252
Net income			26,585				26,674				5,146				6,341				6,946				8,151				7,578
Preferred stock dividends			2,156				2,156				539				539				539				539				539
Net income available to common shareholders		$	24,429			$	24,518			$	4,607			$	5,802			$	6,407			$	7,612			$	7,039
Net income per common share, basic and diluted		$	3.25			$	3.26			$	0.61			$	0.77			$	0.85			$	1.01			$	0.95
Weighted average number of common shares, basic and diluted			7,522,913				7,529,382				7,527,327				7,524,332				7,522,764				7,517,213				7,433,607

 

MainStreet Bancshares, Inc.
UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL
(In thousands)
		December 31, 2023								September 30, 2023								December 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		$	429,637				24.9	%		$	426,698				25.1	%		$	393,783				24.6	%			0.7	%			9.1	%
Residential real estate loans			474,602				27.5	%			462,935				27.2	%			394,394				24.7	%			2.5	%			20.3	%
Commercial real estate loans			743,827				43.1	%			734,615				43.1	%			700,728				43.8	%			1.3	%			6.2	%
Commercial and industrial loans			75,415				4.4	%			73,855				4.3	%			97,351				6.1	%			2.1	%			-22.5	%
Consumer loans			3,610				0.1	%			4,598				0.3	%			13,336				0.8	%			-21.5	%			-72.9	%
Total Gross Loans		$	1,727,091				100.0	%		$	1,702,701				100.0	%		$	1,599,592				100.0	%			1.4	%			8.0	%
Less: Allowance for credit losses			(16,506)								(15,626)								(14,114)
Net deferred loan fees			(5,448)								(5,631)								(5,528)
Net Loans		$	1,705,137							$	1,681,444							$	1,579,950
DEPOSITS:
Non-interest bearing deposits		$	364,606				21.6	%		$	394,859				23.5	%		$	550,690				36.4	%			-7.7	%			-33.8	%
Interest-bearing deposits:
Demand deposits			137,128				8.1	%			76,423				4.5	%			80,099				5.3	%			79.4	%			71.2	%
Savings and NOW deposits			45,878				2.7	%			46,550				2.8	%			51,419				3.4	%			-1.4	%			-10.8	%
Money market accounts			442,179				26.2	%			461,398				27.4	%			222,540				14.7	%			-4.2	%			98.7	%
Certificates of deposit $250,000 or more			442,662				26.3	%			432,440				25.7	%			370,005				24.5	%			2.4	%			19.6	%
Certificates of deposit less than $250,000			253,674				15.1	%			271,520				16.1	%			238,136				15.7	%			-6.6	%			6.5	%
Total Deposits		$	1,686,127				100.0	%		$	1,683,190				100.0	%		$	1,512,889				100.0	%			0.2	%			11.5	%
BORROWINGS:
Federal funds borrowed			15,000				17.1	%			—				0.0	%			—				0.0	%			100.0	%			100.0	%
Federal Home Loan Bank advances			—				0.0	%			—				0.0	%			100,000				58.1	%			-100.0	%			-100.0	%
Subordinated debt			72,642				82.9	%			72,543				100.0	%			72,245				41.9	%			0.1	%			0.5	%
Total Borrowings		$	87,642				100.0	%		$	72,543				100.0	%		$	172,245				100.0	%			20.8	%			-49.1	%
Total Deposits and Borrowings		$	1,773,769							$	1,755,733							$	1,685,134								1.0	%			5.3	%
Core customer funding sources (1)		$	1,252,534				70.7	%		$	1,144,513				65.2	%		$	1,157,573				68.7	%			9.4	%			8.2	%
Brokered and listing service sources (2)			433,593				24.4	%			538,677				30.7	%			355,316				21.1	%			-19.5	%			22.0	%
Federal funds borrowed			15,000				0.8	%			—				0.0	%			—				0.0	%			100.0	%			100.0	%
Federal Home Loan Bank advances			—				0.0	%			—				0.0	%			100,000				5.9	%			0.0	%			-100.0	%
Subordinated debt (3)			72,642				4.1	%			72,543				4.1	%			72,245				4.3	%			0.1	%			0.5	%
Total Funding Sources		$	1,773,769				100.0	%		$	1,755,733				100.0	%		$	1,685,134				100.0	%			1.0	%			5.3	%

(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 $187.2 million in core deposits placed in reciprocal networks for FDIC insurance coverage that will be classified as brokered deposits on the call report in pursuent to rule 12 CFR 337.6(e) as of December 31, 2023.
(3)	Subordinated debt obligation qualifies as Tier 2 capital at the holding company and Tier 1 capital at the Bank

 

MainStreet Bancshares, Inc.
UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES
(In thousands)
		For the three months ended December 31, 2023												For the three months ended December 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)		$	1,720,790			$	30,849				7.11	%		$	1,510,087			$	23,972				6.30	%
Securities:
Taxable			67,494				451				2.65	%			70,776				467				2.62	%
Tax-exempt			37,614				339				3.58	%			38,007				332				3.46	%
Federal funds and interest-bearing deposits			114,421				1,510				5.24	%			124,865				1,071				3.40	%
Total interest-earning assets		$	1,940,319			$	33,149				6.78	%		$	1,743,735			$	25,842				5.88	%
Other assets			57,877												55,559
Total assets		$	1,998,196											$	1,799,294
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits		$	98,021			$	1,058				4.28	%		$	81,724			$	256				1.24	%
Savings and NOW deposits			47,142				146				1.23	%			53,570				81				0.60	%
Money market deposit accounts			477,916				5,639				4.68	%			213,530				781				1.45	%
Time deposits			710,026				8,257				4.61	%			613,262				2,966				1.92	%
Total interest-bearing deposits		$	1,333,105			$	15,100				4.49	%		$	962,086			$	4,084				1.68	%
Federal funds borrowed			1,740				25				5.70	%			2				—				—
FHLB advances			8,424				118				5.56	%			23,913				264				4.38	%
Subordinated debt			72,603				828				4.52	%			72,206				828				4.55	%
Total interest-bearing liabilities		$	1,415,872			$	16,071				4.50	%		$	1,058,207			$	5,176				1.94	%
Demand deposits and other liabilities			365,655												546,827
Total liabilities		$	1,781,527											$	1,605,034
Stockholders' Equity			216,669												194,260
Total Liabilities and Stockholders' Equity		$	1,998,196											$	1,799,294
Interest Rate Spread											2.28	%											3.94	%
Net Interest Income						$	17,078											$	20,666
Net Interest Margin											3.49	%											4.70	%

(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

 

MainStreet Bancshares, Inc.
UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES
(In thousands)
		For the year ended December 31, 2023												For the year ended December 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)		$	1,659,179			$	116,184				7.00	%		$	1,442,716			$	78,872				5.47	%
Securities:
Taxable			68,815				1,836				2.67	%			72,809				1,603				2.20	%
Tax-exempt			37,810				1,348				3.57	%			38,528				1,339				3.48	%
Federal funds and interest-bearing deposits			103,840				5,038				4.85	%			122,596				2,312				1.89	%
Total interest-earning assets		$	1,869,644			$	124,406				6.65	%		$	1,676,649			$	84,126				5.02	%
Other assets			62,161												67,380
Total assets		$	1,931,805											$	1,744,029
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits		$	83,087			$	1,892				2.28	%		$	85,566			$	601				0.70	%
Savings and NOW deposits			49,565				546				1.10	%			63,401				203				0.32	%
Money market deposit accounts			365,815				13,924				3.81	%			137,066				1,547				1.13	%
Time deposits			702,034				27,003				3.85	%			642,918				8,202				1.28	%
Total interest-bearing deposits		$	1,200,501			$	43,365				3.61	%		$	928,951			$	10,553				1.14	%
Federal funds borrowed			5,583				299				5.36	%			2				—				—
FHLB advances			24,959				1,224				4.90	%			23,986				347				1.45	%
Subordinated debt			72,455				3,288				4.54	%			65,176				2,936				4.50	%
Total interest-bearing liabilities		$	1,303,498			$	48,176				3.70	%		$	1,018,115			$	13,836				1.36	%
Demand deposits and other liabilities			418,386												535,075
Total liabilities		$	1,721,884											$	1,553,190
Stockholders' Equity			209,921												190,839
Total Liabilities and Stockholders' Equity		$	1,931,805											$	1,744,029
Interest Rate Spread											2.95	%											3.66	%
Net Interest Income						$	76,230											$	70,290
Net Interest Margin											4.08	%											4.19	%

(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

 

MainStreet Bancshares, Inc.
UNAUDITED SUMMARY FINANCIAL DATA
(Dollars in thousands except per share data)
		At or For the Three Months Ended								At or For the Year Ended
		December 31,								December 31,
		2023				2022				2023				2022
Per share Data and Shares Outstanding
Earnings per common share (basic and diluted)		$	0.61			$	0.95			$	3.25			$	3.26
Book value per common share		$	25.81			$	22.98			$	25.81			$	22.98
Tangible book value per common share(2)		$	23.86			$	21.75			$	23.86			$	21.75
Weighted average common shares (basic and diluted)			7,527,327				7,433,607				7,522,913				7,529,382
Common shares outstanding at end of period			7,527,415				7,442,743				7,527,415				7,442,743
Performance Ratios
Return on average assets (annualized)			1.02	%			1.67	%			1.38	%			1.53	%
Return on average equity (annualized)			9.42	%			15.48	%			12.66	%			13.98	%
Return on average common equity (annualized)			9.65	%			16.72	%			13.37	%			14.99	%
Yield on earning assets (FTE) (2) (annualized)			6.78	%			5.88	%			6.65	%			5.02	%
Cost of interest bearing liabilities (annualized)			4.50	%			1.94	%			3.70	%			1.36	%
Net interest spread (FTE)(2)			2.28	%			3.94	%			2.95	%			3.66	%
Net interest margin (FTE)(2) (annualized)			3.49	%			4.70	%			4.08	%			4.19	%
Noninterest income as a percentage of average assets (annualized)			0.17	%			0.23	%			0.19	%			0.28	%
Noninterest expense to average assets (annualized)			2.21	%			2.36	%			2.34	%			2.24	%
Efficiency ratio(3)			62.33	%			49.45	%			56.69	%			52.19	%
Asset Quality
Allowance for credit losses (ACL)
Beginning balance, ACL - loans		$	15,626			$	12,994			$	14,114			$	11,697
Add: current expected credit losses, nonrecurring adoption			—				—				895				—
Add: recoveries			9				2				22				19
Less: charge-offs			(137)				—				(468)				—
Add: provision for (recovery of) credit losses - loans			1,008				1,118				1,943				2,398
Ending balance, ACL - loans		$	16,506			$	14,114			$	16,506			$	14,114
Beginning balance, reserve for unfunded commitment (RUC)		$	1,552			$	—			$	—			$	—
Add: current expected credit losses, nonrecurring adoption			—				—				1,310				—
Add: provision for (reversal of) unfunded commitments, net			(543)				—				(301)				—
Ending balance, RUC		$	1,009			$	—			$	1,009			$	—
Total allowance for credit losses		$	17,515			$	14,114			$	17,515			$	14,114
Allowance for credit losses on loans to total gross loans			0.96	%			0.88	%			0.96	%			0.88	%
Allowance for credit losses to total gross loans			1.01	%			0.89	%			1.01	%			0.89	%
Allowance for credit losses on loans to non-performing loans			16.44				N/A				16.44				N/A
Net charge-offs (recoveries) to average gross loans (annualized)			0.03	%			0.00	%			0.03	%			0.00	%
Concentration Ratios
Commercial real estate loans to total capital (4)			372.50	%			377.54	%			372.50	%			377.54	%
Construction loans to total capital (5)			137.67	%			137.41	%			137.67	%			137.41	%
Non-performing Assets
Loans 30-89 days past due to total gross loans			0.04	%			0.00	%			0.04	%			0.00	%
Loans 90 days past due to total gross loans			0.00	%			0.00	%			0.00	%			0.00	%
Non-accrual loans to total gross loans			0.06	%			0.00	%			0.06	%			0.00	%
Non-performing assets		$	1,004			$	—			$	1,004			$	—
Non-performing assets to total assets			0.05	%			0.00	%			0.05	%			0.00	%
Regulatory Capital Ratios (Bank only) (1)
Total risk-based capital ratio			17.18	%			16.27	%			17.18	%			16.27	%
Tier 1 risk-based capital ratio			16.22	%			15.47	%			16.22	%			15.47	%
Leverage ratio			14.66	%			15.05	%			14.66	%			15.05	%
Common equity tier 1 ratio			16.22	%			15.47	%			16.22	%			15.47	%
Other information
Closing stock price		$	24.81			$	27.49			$	24.81			$	27.49
Tangible equity / tangible assets (2)			10.24	%			9.87	%			10.24	%			9.87	%
Average tangible equity / average tangible assets (2)			10.22	%			10.39	%			10.31	%			10.66	%
Number of full time equivalent employees			186				168				186				168
Number of full service branch offices			6				6				6				6

(1)	Regulatory capital ratios as of December 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

 

MainStreet Bancshares, Inc.
Unaudited Reconciliation of Certain Non-GAAP Financial Measures
(Dollars In thousands)
		For the three months ended December 31,								For the year ended December 31,
		2023				2022				2023				2022
Net interest margin (FTE)
Net interest income (GAAP)		$	17,007			$	20,596			$	75,947			$	70,009
FTE adjustment on tax-exempt securities			71				70				283				281
Net interest income (FTE) (non-GAAP)			17,078				20,666				76,230				70,290
Average interest earning assets			1,940,319				1,743,735				1,869,644				1,676,649
Net interest margin (GAAP)			3.48	%			4.69	%			4.06	%			4.18	%
Net interest margin (FTE) (non-GAAP)			3.49	%			4.70	%			4.08	%			4.19	%

 

		For the three months ended December 31,								For the year ended December 31,
		2023				2022				2023				2022
Yield on earning assets (FTE)
Total interest income		$	33,078			$	25,772			$	124,123			$	83,845
FTE adjustment on tax-exempt securities			71				70				283				281
Total interest income (FTE) (non-GAAP)			33,149				25,842				124,406				84,126
Average interest earning assets			1,940,319				1,743,735				1,869,644				1,676,649
Yield on earning assets (GAAP)			6.76	%			5.86	%			6.64	%			5.00	%
Yield on earning assets (FTE) (non-GAAP)			6.78	%			5.88	%			6.65	%			5.02	%

 

		For the three months ended December 31,								For the year ended D ecember 31,
		2023				2022				2023				2022
Net interest spread (FTE)
Yield on earning assets (GAAP)			6.76	%			5.86	%			6.64	%			5.00	%
Yield on earning assets (FTE) (non-GAAP)			6.78	%			5.88	%			6.65	%			5.02	%
Yield on interest-bearing liabilities			4.50	%			1.94	%			3.70	%			1.36	%
Net interest spread (GAAP)			2.26	%			3.92	%			2.94	%			3.64	%
Net interest spread (FTE) (non-GAAP)			2.28	%			3.94	%			2.95	%			3.66	%

 

		As of December 31,								As of December 31,
		2023				2022				2023				2022
Stockholders equity, adjusted
Total stockholders equity (GAAP)		$	221,517			$	198,282			$	221,517			$	198,282
Less: intangible assets			14,657				9,149				14,657				9,149
Tangible stockholders equity (non-GAAP)			206,860				189,133			$	206,860			$	189,133
Less: preferred stock			27,263				27,263				27,263				27,263
Tangible common stockholders equity (non-GAAP)			179,597				161,870				179,597				161,870
Common shares outstanding			7,527,415				7,442,743				7,527,415				7,442,743
Tangible book value per common share (non-GAAP)		$	23.86			$	21.75			$	23.86			$	21.75

 

		As of December 31,								As of December 31,
		2023				2022				2023				2022
Total assets, adjusted
Total assets (GAAP)		$	2,035,432			$	1,925,751			$	2,035,432			$	1,925,751
Less: intangible assets			(14,657)				(9,149)				(14,657)				(9,149)
Total tangible assets (non-GAAP)			2,020,775				1,916,602				2,020,775				1,916,602

 

		For the three months ended December 31,								For the year ended December 31,
		2023				2022				2023				2022
Average stockholders equity, adjusted
Total average stockholders equity (GAAP)		$	216,669			$	194,225			$	209,921			$	190,839
Less: average intangible assets			(13,929)				(8,143)				(11,996)				(5,471)
Total average tangible stockholders equity (non-GAAP)			202,740				186,082				197,925				185,368

 

		For the three months ended December 31,								For the year ended December 31,
		2023				2022				2023				2022
Average assets, adjusted
Total average average assets (GAAP)		$	1,998,196			$	1,799,259			$	1,931,805			$	1,744,029
Less: average intangible assets			(13,929)				(8,143)				(11,996)				(5,471)
Total average tangible assets (non-GAAP)			1,984,267				1,791,116				1,919,809				1,738,558

 

Contact: Debra Cope
Director of Corporate Communications
Desk (703) 481-4599
Mobile (202) 468-3184

 

Cision

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