FAIRFAX, Va., July 18, 2017 /PRNewswire/ -- MainStreet Bancshares, Inc. (OTCQB: MNSB), the holding company for MainStreet Bank, reported its best ever quarter of organic growth. Total assets grew 13.4% quarter-on-quarter, from $568 million at March 31, 2017 to $644 million at June 30, 2017. Net loans grew 13.9% to $526 million at June 30, 2017. Year-on-year, total assets grew 25.6% and net loans grew 25.9% from June 30, 2016 to June 30, 2017.
Total deposits as of June 30, 2017 were $539 million, or $115 million over total deposits of $423 million at June 30, 2016. The component of non-interest bearing deposits grew 41.1% from $98.5 million at June 30, 2016 to $139 million at June 30, 2017. Of significance is the continued rise in the level of non-interest bearing deposits, which represent 25.8% of total deposits at June 30, 2017, up 2.3% from June 30, 2016.
Of course the substantial growth in loans was met with a higher than normal loan provision expense of $425 thousand for the second quarter of 2017, which is more than double the amount required for the first quarter of 2017. The loan provision expense is a direct function of the growth in loans. The overall quality of the loan portfolio remains strong, with non-performing loans at just two basis points.
Dialing in the higher than normal loss provision expense, the Company still achieved net income of $950 thousand for the second quarter of 2017, bringing the year-to-date net income to $1.98 million, a 10.6% increase over June 30, 2016.
Net interest income of $9.7 million reported for June 30, 2017 improved $731 thousand over net interest income from June 30, 2016. Non-interest income is up 88.9% from June 30, 2016 to June 30, 2017.
Non-interest expense for the first half of 2017 is $7.5 million compared to $6.8 million for the first half of 2016. The change in salaries over that 12-month period was just $479 thousand, and as a result the efficiency ratio continues to demonstrate improvement.
The book value per common share is $11.30 as of June 30, 2017, up 6.1% from June 30, 2016. The share price closed on June 30, 2017 at $16.05 per common share, or 142% of book value. Per OTCQX Markets, "total share trading increased during the first half of 2017 vs. the same time period last year. Average daily volume in MNSB shares thru June 30, 2017 was 4,700 shares vs. 3,500 shares for the same time period last year. The Company's share price was higher - up 12.92% in the first half of the year as well".
QUOTES: "There is nothing more fulfilling than seeing a plan truly come together," said Jeff W. Dick, Chairman and CEO of MainStreet Bancshares, Inc. and MainStreet Bank. "Our new President Chris Brockett has really hit the ground running – balancing his time between bringing on new talent and new business opportunities. This, combined with the shrinking competition in community banking due to M&A activities, is providing MainStreet with great opportunities without compromising our credit standards."
President Chris Brockett added, "Our first quarter was a bit slower than planned, but our strong second quarter closed that gap and we are on-track with our strategic initiatives. I'm pleased to report that our recently added lenders and business bankers are performing ahead of expectations, and we anticipate a strong finish for 2017."
ABOUT MAINSTREET BANK: MainStreet operates five branches in Herndon, Fairfax, Fairfax City, McLean and Clarendon. In addition, MainStreet 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 literally "put our bank" in nearly 1,000 businesses in the Metropolitan area.
MainStreet has a full complement of payment system services for third party payment providers. MainStreet has a nationally known and leading market expert on-staff ready to help payment providers create a solution perfect for their needs.
MainStreet 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 mobile banking and Apple Pay to instant-issue Debit Cards, MainStreet Bank is always looking for ways to improve its customer experience. Additionally, MainStreet released Aircharity® in 2012. Aircharity® is a unique solution that empowers people and organizations to raise money via email, websites and social media. The product allows a customer to open an account and accept donations from debit cards, credit cards and electronic checks.
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. 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, maintenance and development of well-established and valued client relationships and referral source relationships, and acquisition or loss of key production personnel. Other risks that can affect the Bank are detailed from time to time in our annual reports. 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.
BALANCE SHEETS | ||||||||||||||
(Unaudited) | ||||||||||||||
(In thousands, except ratios) | ||||||||||||||
6/30/17 | 3/31/17 | 12/31/16 | 9/30/16 | 6/30/16 | ||||||||||
ASSETS | ||||||||||||||
Cash and cash equivalents | ||||||||||||||
Cash and due from banks | $ 14,801 | $ 11,867 | $ 17,273 | $ 13,142 | $ 17,483 | |||||||||
Federal funds sold | 4,674 | 4,856 | 797 | 797 | ― | |||||||||
Total cash and cash equivalents | 19,475 | 16,723 | 18,070 | 13,939 | 17,483 | |||||||||
Investment securities available for sale, at fair value | 38,274 | 29,889 | 36,354 | 26,434 | 25,869 | |||||||||
Investment securities held to maturity | 26,615 | 26,664 | 27,714 | 26,518 | 24,357 | |||||||||
Restricted equity securities, at cost | 3,895 | 3,892 | 3,426 | 3,423 | 3,420 | |||||||||
Loans, net of allowance for loan losses | 525,989 | 461,768 | 463,926 | 441,335 | 417,640 | |||||||||
Premises and equipment, net | 12,008 | 12,132 | 12,309 | 12,500 | 12,339 | |||||||||
Other real estate owned, net | 135 | 135 | 135 | 135 | 135 | |||||||||
Accrued interest and other receivables | 2,737 | 2,363 | 2,261 | 2,265 | 2,194 | |||||||||
Bank owned life insurance | 13,417 | 13,308 | 10,202 | 8,126 | 8,051 | |||||||||
Other assets | 1,715 | 1,388 | 1,314 | 1,234 | 1,437 | |||||||||
Total Assets | $ 644,260 | $ 568,262 | $ 575,711 | $ 535,909 | $ 512,925 | |||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||
Liabilities: | ||||||||||||||
Non-interest bearing deposits | $ 139,023 | $ 114,044 | $ 106,050 | $ 114,128 | $ 98,505 | |||||||||
Interest bearing DDA deposits | 27,639 | 17,443 | 41,611 | ― | ― | |||||||||
Savings and NOW deposits | 48,268 | 44,697 | 44,833 | 41,896 | 40,243 | |||||||||
Money market deposits | 86,009 | 79,704 | 75,670 | 76,152 | 59,906 | |||||||||
Other time deposits | 237,853 | 207,854 | 205,402 | 214,636 | 224,753 | |||||||||
Total deposits | 538,792 | 463,742 | 473,566 | 446,812 | 423,407 | |||||||||
Securities sold under agreements to repurchase | ― | ― | ― | 2,736 | ― | |||||||||
Federal Home Loan Bank advances and other borrowings | 40,167 | 40,179 | 40,192 | 40,204 | 44,409 | |||||||||
Subordinated Debt | 14,733 | 14,726 | 14,019 | ― | ― | |||||||||
Other liabilities | 1,807 | 2,011 | 1,539 | 872 | 957 | |||||||||
Total Liabilities | 595,499 | 520,658 | 529,316 | 490,624 | 468,773 | |||||||||
Stockholders' Equity: | ||||||||||||||
Common stock | 16,808 | 16,792 | 16,650 | 16,645 | 16,634 | |||||||||
Capital surplus | 22,229 | 22,126 | 22,152 | 21,995 | 21,913 | |||||||||
Retained earnings | 9,777 | 8,827 | 7,801 | 6,724 | 5,712 | |||||||||
Accumulated other comprehensive income (loss) | (53) | (141) | (208) | (79) | (107) | |||||||||
Total Stockholders' Equity | 48,761 | 47,604 | 46,395 | 45,285 | 44,152 | |||||||||
Total Liabilities and Stockholders' Equity | $ 644,260 | $ 568,262 | $ 575,711 | $ 535,909 | $ 512,925 | |||||||||
Other Financial Highlights | ||||||||||||||
Annualized return on average assets | 0.68% | 0.72% | 0.76% | 0.75% | 0.73% | |||||||||
Annualized return on average equity | 8.06% | 8.74% | 8.72% | 8.52% | 8.25% | |||||||||
Annualized net interest margin | 3.64% | 3.75% | 3.78% | 3.79% | 3.82% | |||||||||
Efficiency ratio | 68.47% | 69.40% | 69.47% | 71.09% | 71.02% | |||||||||
Gross loans to deposits | 98.45% | 100.02% | 98.58% | 99.16% | 99.74% | |||||||||
Allowance for loan losses to total loans | 0.84% | 0.87% | 0.85% | 0.82% | 0.87% | |||||||||
Past due loans 30-89 days to total gross loans | 0.38% | 0.02% | 0.07% | 0.02% | 0.01% | |||||||||
Past due loans 90 days or more to total gross loans | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | |||||||||
Non-accrual loans to total gross loans | 0.02% | 0.02% | 0.04% | 0.09% | 0.09% | |||||||||
Quarterly net loan charge-offs (recoveries) | $ 39 | $ 111 | $ 30 | $ 109 | $ 111 | |||||||||
Book value per share | $ 11.30 | $ 11.09 | $ 10.85 | $ 10.65 | $ 10.39 | |||||||||
Closing stock price | $ 16.05 | $ 16.55 | $ 14.20 | $ 12.60 | $ 11.90 | |||||||||
Regulatory Capital Ratios | ||||||||||||||
Tier 1 risk-based capital ratio | 10.74% | 11.78% | 11.74% | 9.67% | 10.02% | |||||||||
Common equity tier 1 capital ratio | 10.74% | 11.78% | 11.74% | 9.67% | 10.02% | |||||||||
Total risk-based capital ratio | 11.52% | 12.57% | 12.53% | 10.46% | 10.86% | |||||||||
Leverage ratio | 10.32% | 10.69% | 10.95% | 8.66% | 8.91% | |||||||||
STATEMENTS OF INCOME | |||||||||||||
(Unaudited) | |||||||||||||
(In thousands, except share data) | |||||||||||||
Year-to-Date | Three Months Ended | ||||||||||||
6/30/17 | 6/30/16 | 6/30/17 | 3/31/17 | 12/31/16 | 9/30/16 | 6/30/16 | |||||||
INTEREST INCOME: | |||||||||||||
Interest and fees on loans | $ 11,070 | $ 9,814 | $ 5,717 | $ 5,353 | $ 5,267 | $ 5,111 | $ 4,969 | ||||||
Interest on investment securities | 809 | 597 | 413 | 396 | 351 | 339 | 292 | ||||||
Interest on federal funds sold | 87 | 45 | 47 | 40 | 19 | 29 | 21 | ||||||
Total interest income | 11,966 | 10,456 | 6,177 | 5,789 | 5,637 | 5,479 | 5,282 | ||||||
INTEREST EXPENSE: | |||||||||||||
Interest on interest bearing DDA deposits | 84 | ― | 43 | 41 | 11 | ― | ― | ||||||
Interest on savings and NOW deposits | 90 | 80 | 47 | 43 | 44 | 43 | 41 | ||||||
Interest on money market deposits | 266 | 121 | 150 | 116 | 96 | 83 | 62 | ||||||
Interest on other time deposits | 1,130 | 1,143 | 594 | 536 | 579 | 605 | 589 | ||||||
Interest on Federal Home Loan Bank advances and other borrowings |
192 |
121 |
108 |
84 |
74 |
71 |
65 | ||||||
Interest on Subordinated Debt | 482 | ― | 241 | 241 | ― | ― | ― | ||||||
Total interest expense | 2,244 | 1,465 | 1,183 | 1,061 | 804 | 802 | 757 | ||||||
Net interest income |
9,722 |
8,991 |
4,994 |
4,728 |
4,833 |
4,677 |
4,525 | ||||||
Provision for loan losses | 620 | 220 | 425 | 195 | 335 | 90 | 135 | ||||||
Net interest income after provision for loan losses |
9,102 |
8,771 |
4,569 |
4,533 |
4,498 |
4,587 |
4,390 | ||||||
OTHER INCOME: | |||||||||||||
Deposit account service charges | 394 | 348 | 202 | 192 | 183 | 205 | 218 | ||||||
Bank owned life insurance income | 216 | 51 | 110 | 106 | 76 | 75 | 51 | ||||||
Other fee income | 595 | 239 | 246 | 349 | 194 | 156 | 153 | ||||||
Total other income | 1,205 | 638 | 558 | 647 | 453 | 436 | 422 | ||||||
OTHER EXPENSES: | |||||||||||||
Salaries and employee benefits | 4,821 | 4,342 | 2,449 | 2,372 | 2,038 | 2,208 | 2,241 | ||||||
Furniture and equipment expenses | 592 | 545 | 306 | 286 | 301 | 297 | 267 | ||||||
Advertising and marketing | 57 | 118 | 26 | 31 | 56 | 102 | 78 | ||||||
Occupancy expenses | 324 | 376 | 153 | 171 | 158 | 200 | 203 | ||||||
Outside services | 242 | 246 | 113 | 129 | 202 | 167 | 136 | ||||||
Administrative expenses | 188 | 168 | 98 | 90 | 89 | 93 | 99 | ||||||
Other operating expenses | 1,258 | 1,043 | 605 | 653 | 595 | 571 | 534 | ||||||
Total other expenses | 7,482 | 6,838 | 3,750 | 3,732 | 3,439 | 3,638 | 3,558 | ||||||
INCOME BEFORE INCOME TAXES |
2,825 |
2,571 |
1,377 |
1,448 |
1,512 |
1,385 |
1,254 | ||||||
Income tax expense | 848 | 784 | 427 | 421 | 436 | 373 | 381 | ||||||
NET INCOME | $ 1,977 | $ 1,787 | $ 950 | $ 1,027 | $ 1,076 | $ 1,012 | $ 873 | ||||||
Net income per common share, basic and diluted | $ 0.46 | $ 0.42 | $ 0.22 | $ 0.24 | $ 0.25 | $ 0.24 | $ 0.20 | ||||||
Weighted average number of shares, basic and diluted | 4,315,223 | 4,252,611 | 4,315,591 | 4,314,852 | 4,260,232 | 4,260,232 | 4,261,118 | ||||||
Contact: | Jeff W. Dick |
(703) 481-4567 |
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SOURCE MainStreet Bancshares, Inc.
