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/C O R R E C T I O N -- MainStreet Bancshares, Inc./

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In the news release, MainStreet Bancshares, Inc. Reports Another Record Year, issued 20-Jan-2022 by MainStreet Bancshares, Inc. over PR Newswire, we are advised by the company that the second paragraph, "UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES" tables, "UNAUDITED SUMMARY FINANCIAL DATA" table, and the "Reconciliation of Certain Non-GAAP Financial Measures" table have been adjusted to correct the fourth quarter and year-end net interest margins reported in the original. The complete, corrected release follows:

MainStreet Bancshares, Inc. Reports Another Record Year

Bank Nets $22.2 Million and Improves Net Interest Margin

FAIRFAX, Va., Jan. 20, 2022 /PRNewswire/ -- MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the holding company for MainStreet Bank, reported record net income of $22.2 million for 2021. Year-end results represent:

MainStreet Bancshares, Inc. Logo
MainStreet Bancshares, Inc. Logo
  • 12.38% return on average equity

  • 1.32% return on average assets

  • $2.65 per share of common stock (basic and diluted)

  • $20.94 per common share tangible book value

Going forward, the Company's balance sheet is positioned to respond well in a rising interest rate environment.

Net interest income of $53.5 million is up over 16% from last year. Steady loan rates and reduced funding costs propelled the net interest margin higher by 12 basis points to 3.33% in December 2021, versus 3.21% a year earlier. The Company's efficiency ratio remains solid at 55%.

"Going forward, the Company's balance sheet is positioned to respond well in a rising interest rate environment," said Tom Chmelik, CFO and Senior Executive VP of MainStreet Bancshares, Inc. and MainStreet Bank. "When the Federal Reserve initiates a rate increase, it should have a positive impact on the Company's earnings."

The portfolio of hotel loans continues to perform well, and asset quality remains pristine – as nonperforming assets represent a mere 0.05% of total assets.

The loan portfolio grew 4.1% in 2021. Excluding Paycheck Protection Program (PPP) loans, originations of $526 million were offset by paydowns and sales of $364 million. Paydowns in 2021 were significantly higher than normal, which was anticipated after the much lower than normal paydowns experienced in 2020. The balance of PPP loans at year-end was $58 million.

Non-interest-bearing deposits represent 38% of the $1.4 billion in total deposits, and 77% of total deposits are core deposits.

"The team committed significant time and energy to helping our customers navigate the PPP debt forgiveness process," said Abdul Hersiburane, President of MainStreet Bank. "While this is core to relationship banking, it was counter-productive to balance sheet growth in the short-run. We are very pleased to see the return of robust demand for traditional loans as businesses regain their footing and turn to us to support their growth."

The Company is also mapping out strategic initiatives in other areas. On October 25, 2021, the Company unveiled Avenu - its Banking as a Service (BaaS) platform for fintechs. Avenu is a proprietary solution purpose built for its fintech partners. With Avenu, fintech's can be up-and-running as quickly as 60 days. The Company is planning to go live with Avenu in the third quarter of 2022. If you are a fintech looking to add payments and deposits to your solution, go to Avenu.bank and join the queue today.

"The solution that the Avenu team is developing will be transformational for the Company and the fintech community," said Jeff W. Dick, Chairman & CEO of MainStreet Bancshares, Inc. and MainStreet Bank. "We're demystifying the banking process by offering fintechs modern API connectivity to our robust fintech core. We're also providing a purpose-built training program on banking and compliance that will bring the fintech's team up-to-speed on all they need to know to operate in this space. The net result for the Company should be a significant increase in low-cost deposits and a new source for fee income."

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, DC 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.

Contact: Jeff W. Dick, Chairman & CEO
(703) 481-4567

UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION

(In thousands, except share data)




December 31, 2021



September 30, 2021



June 30,

2021



March 31, 2021



December 31,

2020


ASSETS





















Cash and cash equivalents





















Cash and due from banks


$

61,827



$

67,992



$

120,121



$

118,399



$

75,935


Federal funds sold



31,372




65,725




56,164




51,598




31,593


Total cash and cash equivalents



93,199




133,717




176,285




169,997




107,528


Investment securities available for sale, at fair value



99,913




171,603




165,791




180,028




147,414


Investment securities held to maturity, at carrying value



20,349




21,148




21,181




21,449




22,520


Restricted equity securities, at cost



15,609




9,972




9,994




9,642




4,616


Loans held for sale















57,006


Loans, net of allowance for loan losses of $11,697, $11,428, $11,133,

$13,215, and $12,877, respectively



1,341,760




1,246,331




1,256,436




1,299,169




1,230,379


Premises and equipment, net



14,863




14,795




13,929




13,975




14,289


Other real estate owned, net



775




1,158




1,158




1,180




1,180


Accrued interest and other receivables



7,701




4,718




8,752




9,349




9,604


Computer software, net of amortization



2,493




1,165











Bank owned life insurance



36,241




35,987




35,736




25,518




25,341


Other assets



14,499




16,605




18,433




12,722




23,288


Total Assets


$

1,647,402



$

1,657,199



$

1,707,695



$

1,743,029



$

1,643,165


LIABILITIES AND STOCKHOLDERS' EQUITY





















Liabilities:





















Non-interest bearing deposits


$

530,678



$

475,157



$

486,001



$

492,463



$

370,497


Interest bearing DDA deposits



69,232




63,622




68,028




69,180




70,307


Savings and NOW deposits



85,175




79,556




72,353




72,259




74,099


Money market deposits



267,730




310,776




310,303




342,468




426,600


Time deposits



459,148




485,255




528,247




561,772




496,743


Total deposits



1,411,963




1,414,366




1,464,932




1,538,142




1,438,246


Subordinated debt



29,294




40,635




40,576




14,841




14,834


Other liabilities



17,357




18,169




22,559




17,868




22,420


Total Liabilities



1,458,614




1,473,170




1,528,067




1,570,851




1,475,500


Stockholders' Equity:





















Preferred stock



27,263




27,263




27,263




27,263




27,263


Common stock



29,466




29,462




29,446




29,437




29,130


Capital surplus



67,668




67,152




66,667




66,233




66,116


Retained earnings



64,194




59,920




55,676




49,090




44,179


Accumulated other comprehensive income



197




232




576




155




977


Total Stockholders' Equity



188,788




184,029




179,628




172,178




167,665


Total Liabilities and Stockholders' Equity


$

1,647,402



$

1,657,199



$

1,707,695



$

1,743,029



$

1,643,165


UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION

(In thousands, except share and per share data)




Year-to-Date



Three Months Ended




December 31, 2021



December 31, 2020



December 31, 2021



September 30, 2021



June 30,
2021



March 31, 2021



December 31, 2020


INTEREST INCOME:





























Interest and fees on loans


$

61,743



$

59,634



$

15,532



$

15,162



$

15,257



$

15,792



$

15,933


Interest on investment securities



2,322




2,007




610




585




597




530




519


Interest on federal funds sold



134




431




61




38




20




15




15


Total interest income



64,199




62,072




16,203




15,785




15,874




16,337




16,467


INTEREST EXPENSE:





























Interest on interest bearing DDA deposits



229




317




59



...