false 0001693577 0001693577 2024-10-28 2024-10-28 0001693577 mnsb:CommonStockCustomMember 2024-10-28 2024-10-28 0001693577 mnsb:DepositarySharesCustomMember 2024-10-28 2024-10-28
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 

FORM 8-K
 

 
CURRENT REPORT
 
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): Date: October 28, 2024
 

 
logo01.jpg
 
MainStreet Bancshares, Inc.
(Exact name of Registrant as Specified in Its Charter)
 

 
Virginia
001-38817
81-2871064
(State or Other Jurisdiction
of Incorporation)
(Commission File Number)
(IRS Employer
Identification No.)
     
10089 Fairfax Boulevard, Fairfax, VA
 
22030
(Address of Principal Executive Offices)
 
(Zip Code)
 
(703) 481-4567
(Registrants Telephone Number, Including Area Code)
 
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
 

 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Act:
 
Title of each class
 
Trading
Symbol(s)
 
Name of each exchange on which registered
Common Stock
 
MNSB
 
The Nasdaq Stock Market LLC
Depositary Shares (each representing a 1/40th interest in a share of 7.50% Series A Fixed-Rate Non-Cumulative Perpetual Preferred Stock
 
MNSBP
 
The Nasdaq Stock Market LLC
 
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
 
Emerging growth company  
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 
 
 

 
Item 2.02 Results of Operations and Financial Condition.
 
On October 28, 2024, MainStreet Bancshares, Inc. (the “Company”) issued a press release setting forth the Company’s third quarter and year-to-date ended September 30, 2024 unaudited financial results. A copy of the Company’s press release is attached hereto as Exhibit 99.1, is hereby incorporated by reference, and will be posted on the Company's website.
 
Item 7.01 Regulation FD Disclosure
 
On October 28, 2024, the Company made available an investor presentation analyzing its third quarter financial results. A copy of the Company’s investor presentation is attached hereto as Exhibit 99.2, is hereby incorporated by reference, and will be posted on the Company’s website.
 
The information furnished under Items 2.02, 7.01 and 9.01 of this Current Report on Form 8-K, including the exhibits, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, and it shall not be deemed incorporated by reference in any filing under the Exchange Act, or the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such filing to this Form 8-K.
 
Item 9.01 Financial Statements and Exhibits.
 
(d) Exhibits.
 
Exhibit
Number
 
Description
99.1
 
99.2   Investor Presentation dated October 28, 2024.
104
 
Cover Page Interactive Data File (embedded within the Inline XBRL document).
 
1

 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
   
MAINSTREET BANCSHARES, INC
       
Date: October 28, 2024
 
By:
/s/ Thomas J. Chmelik
     
Name: Thomas J. Chmelik
     
Title: Chief Financial Officer
 
2

 

Exhibit 99.1

 

 

PRESS RELEASE

 

 Contact: Debra Cope

October 28, 2024 8:00 AM ET

 

Director of Corporate Communications

    Desk (703) 481-4599
    Mobile (202) 468-3184

MainStreet Bancshares Inc. Reports Third Quarter Results

Increase in Core Deposits, a High Quality Loan Portfolio and Strong Capital

 

 

Fairfax, VA., October 28, 2024  MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the financial holding company for MainStreet Bank, reported a loss of -$0.04 per common share for the third quarter of 2024 as it dealt decisively with a small number of nonperforming real estate loans.  Year-to-date 2024 earnings per common share are $0.60. The Company remains strongly capitalized.

 

“Our third quarter annualized net interest margin was impacted by $984,000 in accrued interest income that was reversed in relation to loans placed on nonaccrual status,” said Alex Vari, Chief Accountant for MainStreet Bank.  “This resulted in a quarterly net interest margin of 3.05% and a year-to-date net interest margin of 3.19%.”  

 

The Company charged off $1.9 million of nonperforming loans during the quarter and allocated $1 million to provision expense to augment loan growth and ensure the Allowance for Credit Losses remains directionally consistent for the purposes of growth and quality.

 

In response to the bank’s credit quality, Chris Johnston, Chief Credit Officer for MainStreet Bank, expanded, “this quarter showed the underlying strength of a portfolio shaped by a rigorous credit culture. The total principal losses incurred year-to-date 2024 approximates just 0.1% of total loans.  Our lending team has demonstrated great resolve in addressing troubled loans, both by working with borrowers and by finding acceptable solutions minimizing the impact on shareholder value. With that, we expect the level of problem loans to improve from this point.”

 

Total deposits expanded to $1.9 billion.  The Bank continues to attract healthy amounts of core deposits, reaching $1.47 billion, or 78% of total deposits. 

 

“The DC Metropolitan area is a vibrant market.  Our Business Bankers continue to perform, growing noninterest bearing core deposits by $33 million during the quarter,” noted Abdul Hersiburane, President of MainStreet Bank. “In an exercise of foresight, we structured noncore deposits with immediate rate repricing or callable options. We have now $233 million of our $423 million noncore deposits available to reprice as rates fall.”

 

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 just prior to the end of the third quarter of 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,” said Jeff W. Dick, Chairman & CEO of MainStreet Bancshares, Inc. and MainStreet Bank.  “With Version 1 of Avenu placed in-service, the team is focused on getting the first fintech to general release in early November, and another four fintechs to follow soon thereafter.  Just as with any business expansion opportunity, the expenses associated with launching Avenu will impact profitability until we reach break-even.  However, after that point Avenu’s ability to digitally scale can far surpass bricks and mortar growth and profitability.”

 

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.

 

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 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)

 

   

September 30, 2024

    June 30, 2024    

March 31, 2024

   

December 31, 2023*

   

September 30, 2023

 

ASSETS

                                       

Cash and cash equivalents

                                       

Cash and due from banks

  $ 40,955     $ 41,697     $ 49,208     $ 53,581     $ 44,912  

Federal funds sold

    191,159       49,762       75,533       60,932       76,271  

Total cash and cash equivalents

    232,114       91,459       124,741       114,513       121,183  

Investment securities available for sale, at fair value

    58,489       57,605       58,699       59,928       56,726  

Investment securities held to maturity, at amortized cost, net of allowance for credit losses of $0 for all periods

    16,016       16,036       17,251       17,275       17,565  

Restricted equity securities, at amortized cost

    26,745       26,797       23,924       24,356       20,619  

Loans, net of allowance for credit losses of $18,327, $17,098, $16,531, $16,506, and $15,626, respectively

    1,775,558       1,778,840       1,727,110       1,705,137       1,681,444  

Premises and equipment, net

    13,571       13,787       14,081       13,944       14,275  

Accrued interest and other receivables

    11,077       11,916       10,727       12,390       11,184  

Computer software, net of amortization

    18,881       17,205       15,691       14,657       13,373  

Bank owned life insurance

    39,203       38,901       38,609       38,318       38,035  

Other assets

    32,945       41,200       39,182       34,914       47,087  

Total Assets

  $ 2,224,599     $ 2,093,746     $ 2,070,015     $ 2,035,432     $ 2,021,491  

LIABILITIES AND STOCKHOLDERS’ EQUITY

                                       

Liabilities:

                                       

Non-interest bearing deposits

  $ 347,575     $ 314,636     $ 348,945     $ 364,606     $ 394,859  

Interest bearing demand deposits

    197,527       179,513       165,331       137,128       76,423  

Savings and NOW deposits

    61,893       60,867       46,036       45,878       46,550  

Money market deposits

    451,936       476,396       446,903       442,179       461,398  

Time deposits

    834,738       723,951       725,520       696,336       703,960  

Total deposits

    1,893,669       1,755,363       1,732,735       1,686,127       1,683,190  

Federal funds purchased

                      15,000        

Subordinated debt

    72,940       72,841       72,741       72,642       72,543  

Other liabilities

    31,939       40,827       41,418       40,146       52,015  

Total Liabilities

    1,998,548       1,869,031       1,846,894       1,813,915       1,807,748  

Stockholders’ Equity:

                                       

Preferred stock

    27,263       27,263       27,263       27,263       27,263  

Common stock

    29,463       29,452       29,514       29,198       29,188  

Capital surplus

    67,083       66,392       65,940       65,985       65,407  

Retained earnings

    108,616       109,651       108,334       106,549       102,694  

Accumulated other comprehensive loss

    (6,374 )     (8,043 )     (7,930 )     (7,478 )     (10,809 )

Total Stockholders’ Equity

    226,051       224,715       223,121       221,517       213,743  

Total Liabilities and Stockholders’ Equity

  $ 2,224,599     $ 2,093,746     $ 2,070,015     $ 2,035,432     $ 2,021,491  

 

*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

 
   

September 30, 2024

   

September 30, 2023

   

September 30, 2024

   

June 30, 2024

   

March 31, 2024

   

December 31, 2023

   

September 30, 2023

 

INTEREST INCOME:

                                                       

Interest and fees on loans

  $ 93,852     $ 85,530     $ 31,615     $ 31,655     $ 30,582     $ 30,951     $ 29,822  

Interest on investment securities

                                                       

Taxable securities

    1,262       1,384       397       430       435       451       459  

Tax-exempt securities

    832       797       294       268       270       268       268  

Interest on federal funds sold

    3,550       3,528       1,285       1,083       1,182       1,510       1,217  

Total interest income

    99,496       91,239       33,591       33,436       32,469       33,180       31,766  

INTEREST EXPENSE:

                                                       

Interest on interest bearing demand deposits

    6,049       761       2,117       2,118       1,814       1,027       216  

Interest on savings and NOW deposits

    553       400       206       190       157       146       145  

Interest on money market deposits

    15,911       8,091       5,277       5,542       5,092       5,538       4,068  

Interest on time deposits

    27,361       18,719       9,543       9,010       8,808       8,187       7,516  

Interest on federal funds purchased

    575       274       277       191       107       25       35  

Interest on Federal Home Loan Bank advances

    46       1,105                   46       118       186  

Interest on subordinated debt

    2,468       2,460       828       820       820       828       828  

Total interest expense

    52,963       31,810       18,248       17,871       16,844       15,869       12,994  

Net interest income

    46,533       59,429       15,343       15,565       15,625       17,311       18,772  

Provision for (recovery of) credit losses

    3,356       1,176       2,913       638       (195 )     466       255  

Net interest income after provision for (recovery of) credit losses

    43,177       58,253       12,430       14,927       15,820       16,845       18,517  

NON-INTEREST INCOME:

                                                       

Deposit account service charges

    1,516       1,639       557       490       469       510       514  

Bank owned life insurance income

    885       786       302       291       292       283       272  

Net loss on securities called or matured

    (48 )                 (48 )                  

Other non-interest income (loss)

    93       158       27       31       35       (34 )     105  

Total non-interest income

    2,446       2,583       886       764       796       759       891  

NON-INTEREST EXPENSES:

                                                       

Salaries and employee benefits

    22,222       21,139       7,250       7,484       7,488       7,129       6,924  

Furniture and equipment expenses

    2,806       1,983       931       940       935       804       713  

Advertising and marketing

    1,599       2,072       579       566       454       271       577  

Occupancy expenses

    1,257       1,287       407       415       435       397       375  

Outside services

    2,458       1,691       845       839       774       352       697  

Administrative expenses

    686       703       215       229       242       219       277  

Other operating expenses

    7,508       5,404       2,992       2,362       2,153       2,166       1,988  

Total non-interest expenses

    38,536       34,279       13,219       12,835       12,481       11,338       11,551  

Income before income tax expense (benefit)

    7,087       26,557       97       2,856       4,135       6,266       7,857  

Income tax expense (benefit)

    900       5,119       (168 )     238       830       1,120       1,516  

Net income

    6,187       21,438       265       2,618       3,305       5,146       6,341  

Preferred stock dividends

    1,617       1,617       539       539       539       539       539  

Net income (loss) available to common shareholders

  $ 4,570     $ 19,821     $ (274 )   $ 2,079     $ 2,766     $ 4,607     $ 5,802  

Earnings (loss) per common share, basic and diluted

  $ 0.60     $ 2.64     $ (0.04 )   $ 0.27     $ 0.36     $ 0.61     $ 0.77  

Weighted average number of common shares, basic and diluted

    7,607,431       7,521,426       7,601,925       7,608,389       7,611,990       7,527,327       7,524,332  

 

 

 

 

UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL

(In thousands)

 

   

September 30, 2024

   

June 30, 2024

   

September 30, 2023

   

Percentage Change

 
   

$ Amount

   

% of Total

   

$ Amount

   

% of Total

   

$ Amount

   

% of Total

   

Last 3 Mos

   

Last 12 Mos

 

LOANS:

                                                               

Construction and land development loans

  $ 373,486       20.8 %   $ 410,698       22.8 %   $ 426,698       25.1 %     -9.1 %     -12.5 %

Residential real estate loans

    446,109       24.8 %     449,700       25.0 %     462,935       27.2 %     -0.8 %     -3.6 %

Commercial real estate loans

    871,280       48.4 %     845,030       46.9 %     734,615       43.1 %     3.1 %     18.6 %

Commercial and industrial loans

    106,249       5.9 %     93,559       5.2 %     73,855       4.3 %     13.6 %     43.9 %

Consumer loans

    1,977       0.1 %     2,232       0.1 %     4,598       0.3 %     -11.4 %     -57.0 %

Total Gross Loans

  $ 1,799,101       100.0 %   $ 1,801,219       100.0 %   $ 1,702,701       100.0 %     -0.1 %     5.7 %

Less: Allowance for credit losses

    (18,327 )             (17,098 )             (15,626 )                        

Net deferred loan fees

    (5,216 )             (5,281 )             (5,631 )                        

Net Loans

  $ 1,775,558             $ 1,778,840             $ 1,681,444                          

DEPOSITS:

                                                               

Non-interest bearing deposits

  $ 347,575       18.4 %   $ 314,636       17.9 %   $ 394,859       23.5 %     10.5 %     -12.0 %

Interest-bearing deposits:

                                                               

Demand deposits

    197,527       10.4 %     179,513       10.2 %     76,423       4.5 %     10.0 %     158.5 %

Savings and NOW deposits

    61,893       3.3 %     60,867       3.5 %     46,550       2.8 %     1.7 %     33.0 %

Money market deposits

    451,936       23.9 %     476,396       27.1 %     461,398       27.4 %     -5.1 %     -2.1 %

Certificates of deposit $250,000 or more

    532,201       28.0 %     473,827       27.0 %     432,440       25.7 %     12.3 %     23.1 %

Certificates of deposit less than $250,000

    302,537       16.0 %     250,124       14.3 %     271,520       16.1 %     21.0 %     11.4 %

Total Deposits

  $ 1,893,669       100.0 %   $ 1,755,363       100.0 %   $ 1,683,190       100.0 %     7.9 %     12.5 %

BORROWINGS:

                                                               

Subordinated debt

    72,940       100.0 %     72,841       100.0 %     72,543       100.0 %     0.1 %     0.5 %

Total Borrowings

  $ 72,940       100.0 %   $ 72,841       100.0 %   $ 72,543       100.0 %     0.1 %     0.5 %

Total Deposits and Borrowings

  $ 1,966,609             $ 1,828,204             $ 1,755,733               7.6 %     12.0 %
                                                                 

Core customer funding sources (1)

  $ 1,471,350       74.8 %   $ 1,376,991       75.3 %   $ 1,144,513       65.2 %     6.9 %     28.6 %

Brokered and listing service sources (2)

    422,319       21.5 %     378,372       20.7 %     538,677       30.7 %     11.6 %     -21.6 %

Subordinated debt (3)

    72,940       3.7 %     72,841       4.0 %     72,543       4.1 %     0.1 %     0.5 %

Total Funding Sources

  $ 1,966,609       100.0 %   $ 1,828,204       100.0 %   $ 1,755,733       100.0 %     7.6 %     12.0 %

 

(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.

  Excludes $278.6 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 September 30, 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 September 30, 2024

   

For the three months ended September 30, 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)

  $ 1,807,882     $ 31,615       6.94 %   $ 1,665,474     $ 29,822       7.10 %

Securities:

                                               

Taxable

    54,523       397       2.89 %     57,981       459       3.14 %

Tax-exempt

    35,881       372       4.11 %     37,812       339       3.56 %

Federal funds and interest-bearing deposits

    104,459       1,285       4.88 %     94,808       1,217       5.09 %

Total interest-earning assets

  $ 2,002,745     $ 33,669       6.67 %   $ 1,856,075     $ 31,837       6.81 %

Other assets

    123,383                       73,415                  

Total assets

  $ 2,126,128                     $ 1,929,490                  

Liabilities and Stockholders’ Equity:

                                               

Interest-bearing liabilities:

                                               

Interest-bearing demand deposits

  $ 173,996     $ 2,117       4.83 %   $ 77,047     $ 216       1.11 %

Savings and NOW deposits

    61,259       206       1.33 %     48,594       145       1.18 %

Money market deposits

    445,730       5,277       4.70 %     413,710       4,068       3.90 %

Time deposits

    759,247       9,543       4.99 %     700,405       7,516       4.26 %

Total interest-bearing deposits

  $ 1,440,232     $ 17,143       4.72 %   $ 1,239,756     $ 11,945       3.82 %

Federal funds purchased

    19,001       277       5.78 %     2,501       35       5.55 %

FHLB advances

                      13,478       186       5.48 %

Subordinated debt

    72,901       828       4.51 %     72,504       828       4.53 %

Total interest-bearing liabilities

  $ 1,532,134     $ 18,248       4.73 %   $ 1,328,239     $ 12,994       3.88 %

Demand deposits and other liabilities

    368,349                       388,004                  

Total liabilities

  $ 1,900,483                     $ 1,716,243                  

Stockholders’ Equity

    225,645                       213,247                  

Total Liabilities and Stockholders’ Equity

  $ 2,126,128                     $ 1,929,490                  

Interest Rate Spread

                    1.94 %                     2.93 %

Net Interest Income

          $ 15,421                     $ 18,843          

Net Interest Margin

                    3.05 %                     4.01 %

 

(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 nine months ended September 30, 2024

   

For the nine months ended September 30, 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)

  $ 1,773,050     $ 93,852       7.08 %   $ 1,640,460     $ 85,530       6.97 %

Securities:

                                               

Taxable

    55,478       1,262       3.04 %     60,640       1,384       3.05 %

Tax-exempt

    36,670       1,053       3.84 %     37,876       1,009       3.56 %

Federal funds and interest-bearing deposits

    93,853       3,550       5.06 %     99,004       3,528       4.76 %

Total interest-earning assets

  $ 1,959,051     $ 99,717       6.81 %   $ 1,837,980     $ 91,451       6.65 %

Other assets

    125,808                       71,452                  

Total assets

  $ 2,084,859                     $ 1,909,432                  

Liabilities and Stockholders’ Equity:

                                               

Interest-bearing liabilities:

                                               

Interest-bearing demand deposits

  $ 164,192     $ 6,049       4.93 %   $ 78,018     $ 761       1.30 %

Savings and NOW deposits

    51,119       553       1.45 %     50,382       400       1.06 %

Money market deposit

    447,668       15,911       4.75 %     328,037       8,091       3.30 %

Time deposits

    728,459       27,361       5.02 %     699,377       18,719       3.58 %

Total interest-bearing deposits

  $ 1,391,438     $ 49,874       4.79 %   $ 1,155,814     $ 27,971       3.24 %

Federal funds purchased

    13,279       575       5.79 %     6,878       274       5.33 %

FHLB advances

    1,095       46       5.62 %     30,531       1,105       4.84 %

Subordinated debt

    72,802       2,468       4.53 %     72,405       2,460       4.54 %

Total interest-bearing liabilities

  $ 1,478,614     $ 52,963       4.79 %   $ 1,265,628     $ 31,810       3.36 %

Demand deposits and other liabilities

    382,591                       436,157                  

Total liabilities

  $ 1,861,205                     $ 1,701,785                  

Stockholders’ Equity

    223,654                       207,647                  

Total Liabilities and Stockholders’ Equity

  $ 2,084,859                     $ 1,909,432                  

Interest Rate Spread

                    2.02 %                     3.30 %

Net Interest Income

          $ 46,754                     $ 59,641          

Net Interest Margin

                    3.19 %                     4.34 %

 

(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 Nine Months Ended

 
   

September 30,

   

September 30,

 
   

2024

   

2023

   

2024

   

2023

 

Per share Data and Shares Outstanding

                               

Earnings (loss) per common share (basic and diluted)

  $ (0.04 )   $ 0.77     $ 0.60     $ 2.64  

Book value per common share

  $ 26.15     $ 24.78     $ 26.15     $ 24.78  

Tangible book value per common share(2)

  $ 23.66     $ 23.00     $ 23.66     $ 23.00  

Weighted average common shares (basic and diluted)

    7,601,925       7,524,332       7,607,431       7,521,426  

Common shares outstanding at end of period

    7,602,783       7,524,887       7,602,783       7,524,887  

Performance Ratios

                               

Return on average assets (annualized)

    0.05 %     1.30 %     0.40 %     1.50 %

Return on average equity (annualized)

    0.47 %     11.80 %     3.70 %     13.80 %

Return on average common equity (annualized)

    0.53 %     12.38 %     4.21 %     14.73 %

Yield on earning assets (FTE) (2) (annualized)

    6.67 %     6.81 %     6.81 %     6.65 %

Cost of interest bearing liabilities (annualized)

    4.73 %     3.88 %     4.79 %     3.36 %

Net interest spread (FTE)(2)

    1.94 %     2.93 %     2.02 %     3.30 %

Net interest margin (FTE)(2) (annualized)

    3.05 %     4.01 %     3.19 %     4.34 %

Non-interest income as a percentage of average assets (annualized)

    0.17 %     0.18 %     0.16 %     0.18 %

Non-interest expense to average assets (annualized)

    2.47 %     2.38 %     2.47 %     2.39 %

Efficiency ratio(3)

    81.45 %     58.74 %     78.68 %     54.94 %

Asset Quality

                               

Allowance for credit losses (ACL)

                               

Beginning balance, ACL - loans

  $ 17,098     $ 16,047     $ 16,506     $ 14,114  

Add: recoveries

    11       1       19       14  

Less: charge-offs

    (1,907 )     (324 )     (2,418 )     (331 )

Add: provision for (recovery of) credit losses - loans

    3,125       (98 )     4,220       934  

Add: current expected credit losses, nonrecurring adoption

                      895  

Ending balance, ACL - loans

  $ 18,327     $ 15,626     $ 18,327     $ 15,626  
                                 

Beginning balance, reserve for unfunded commitment (RUC)

  $ 357     $ 1,199     $ 1,009     $  

Add: current expected credit losses, nonrecurring adoption

                      1,310  

Add: provision for (recovery of) unfunded commitments, net

    (212 )     353       (864 )     242  

Ending balance, RUC

  $ 145     $ 1,552     $ 145     $ 1,552  

Total allowance for credit losses

  $ 18,472     $ 17,178     $ 18,472     $ 17,178  
                                 

Allowance for credit losses on loans to total gross loans

    1.02 %     0.92 %     1.02 %     0.92 %

Allowance for credit losses to total gross loans

    1.03 %     1.01 %     1.03 %     1.01 %

Allowance for credit losses on loans to non-performing loans

    64.84 %     48.08X       64.84 %     48.08X  

Net charge-offs (recoveries) to average gross loans (annualized)

    0.42 %     0.08 %     0.18 %     0.02 %

Concentration Ratios

                               

Commercial real estate loans to total capital (4)

    360.26 %     372.48 %     360.26 %     372.48 %

Construction loans to total capital (5)

    118.15 %     138.79 %     118.15 %     138.79 %

Non-performing Assets

                               

Loans 30-89 days past due and accruing to total gross loans

    0.61 %     0.05 %     0.61 %     0.05 %

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

    1.57 %     0.02 %     1.57 %     0.02 %

Other real estate owned

  $     $     $     $  

Non-performing loans

  $ 28,264     $ 325     $ 28,264     $ 325  

Non-performing assets to total assets

    1.27 %     0.02 %     1.27 %     0.02 %

Regulatory Capital Ratios (Bank only) (1)

                               

Total risk-based capital ratio

    16.96 %     16.79 %     16.96 %     16.79 %

Tier 1 risk-based capital ratio

    15.97 %     15.83 %     15.97 %     15.83 %

Leverage ratio

    13.98 %     14.81 %     13.98 %     14.81 %

Common equity tier 1 ratio

    15.97 %     15.83 %     15.97 %     15.83 %

Other information

                               

Closing stock price

  $ 18.45     $ 20.54     $ 18.45     $ 20.54  

Tangible equity / tangible assets (2)

    9.39 %     9.98 %     9.39 %     9.98 %

Average tangible equity / average tangible assets (2)

    9.86 %     10.46 %     10.02 %     10.34 %

Number of full time equivalent employees

    201       185       201       185  

Number of full service branch offices

    6       6       6       6  

 

(1)

Regulatory capital ratios as of September 30, 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 September 30,

   

For the nine months ended September 30,

 
   

2024

   

2023

   

2024

   

2023

 

Net interest margin (FTE)

                               

Net interest income (GAAP)

  $ 15,343     $ 18,772     $ 46,533     $ 59,429  

FTE adjustment on tax-exempt securities

    78       71       221       212  

Net interest income (FTE) (non-GAAP)

    15,421       18,843       46,754       59,641  
                                 

Average interest earning assets

    2,002,745       1,856,075       1,959,051       1,837,980  

Net interest margin (GAAP)

    3.04 %     3.99 %     3.18 %     4.32 %

Net interest margin (FTE) (non-GAAP)

    3.05 %     4.01 %     3.19 %     4.34 %

 

   

For the three months ended September 30,

   

For the nine months ended September 30,

 
   

2024

   

2023

   

2024

   

2023

 

Yield on earning assets (FTE)

                               

Total interest income (GAAP)

  $ 33,591     $ 31,766     $ 99,496     $ 91,239  

FTE adjustment on tax-exempt securities

    78       71       221       212  

Total interest income (FTE) (non-GAAP)

    33,669       31,837       99,717       91,451  
                                 

Average interest earning assets

    2,002,745       1,856,075       1,959,051       1,837,980  

Yield on earning assets (GAAP)

    6.65 %     6.79 %     6.79 %     6.64 %

Yield on earning assets (FTE) (non-GAAP)

    6.67 %     6.81 %     6.81 %     6.65 %

 

   

For the three months ended September 30,

   

For the nine months ended September 30,

 
   

2024

   

2023

   

2024

   

2023

 

Net interest spread (FTE)

                               

Yield on earning assets (GAAP)

    6.65 %     6.79 %  

6.79

%  

6.64

%

Yield on earning assets (FTE) (non-GAAP)

    6.67 %     6.81 %  

6.81

%  

6.65

%
                                 

Yield on interest-bearing liabilities (GAAP)

    4.73 %     3.88 %  

4.79

%     3.36 %

Net interest spread (GAAP)

    1.92 %     2.91 %  

2.00

%  

3.29

%

Net interest spread (FTE) (non-GAAP)

    1.94 %     2.93 %     2.02 %  

3.30

%

 

   

As of September 30,

   

As of September 30,

 
   

2024

   

2023

   

2024

   

2023

 

Tangible common stockholders' equity

                               

Total stockholders equity (GAAP)

  $ 226,051     $ 213,743     $ 226,051     $ 213,743  

Less: intangible assets

    (18,881 )     (13,373 )     (18,881 )     (13,373 )

Tangible stockholders' equity (non-GAAP)

    207,170       200,370     $ 207,170       200,370  

Less: preferred stock

    (27,263 )     (27,263 )     (27,263 )     (27,263 )

Tangible common stockholders' equity (non-GAAP)

    179,907       173,107       179,907       173,107  
                                 

Common shares outstanding

    7,602,783       7,524,887       7,602,783       7,524,887  

Tangible book value per common share (non-GAAP)

  $ 23.66     $ 23.00     $ 23.66     $ 23.00  

 

   

As of September 30,

   

As of September 30,

 
   

2024

   

2023

   

2024

   

2023

 

Stockholders equity, adjusted

                               

Total stockholders equity (GAAP)

  $ 226,051     $ 213,743     $ 226,051     $ 213,743  

Less: intangible assets

    (18,881 )     (13,373 )     (18,881 )     (13,373 )

Total tangible stockholders equity (non-GAAP)

    207,170       200,370       207,170       200,370  

 

   

As of September 30,

   

As of September 30,

 
   

2024

   

2023

   

2024

   

2023

 

Total tangible assets

                               

Total assets (GAAP)

  $ 2,224,599     $ 2,021,491     $ 2,224,599     $ 2,021,491  

Less: intangible assets

    (18,881 )     (13,373 )     (18,881 )     (13,373 )

Total tangible assets (non-GAAP)

    2,205,718       2,008,118       2,205,718       2,008,118  

 

   

For the three months ended September 30,

   

For the nine months ended September 30,

 
   

2024

   

2023

   

2024

   

2023

 

Average tangible stockholders' equity

                               

Total average stockholders' equity (GAAP)

  $ 225,645     $ 213,247     $ 223,654     $ 207,647  

Less: average intangible assets

    (17,738 )     (12,841 )     (16,405 )     (11,345 )

Total average tangible stockholders' equity (non-GAAP)

    207,907       200,406       207,249       196,302  

 

   

For the three months ended September 30,

   

For the nine months ended September 30,

 
   

2024

   

2023

   

2024

   

2023

 

Average tangible assets

                               

Total average assets (GAAP)

  $ 2,126,128     $ 1,929,490     $ 2,084,859     $ 1,909,432  

Less: average intangible assets

    (17,738 )     (12,841 )     (16,405 )     (11,345 )

Total average tangible assets (non-GAAP)

    2,108,390       1,916,649       2,068,454       1,898,087  

 

 

 

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v3.24.3
Document And Entity Information
Oct. 28, 2024
Document Information [Line Items]  
Entity, Registrant Name MainStreet Bancshares, Inc.
Document, Type 8-K
Document, Period End Date Oct. 28, 2024
Entity, Incorporation, State or Country Code VA
Entity, File Number 001-38817
Entity, Tax Identification Number 81-2871064
Entity, Address, Address Line One 10089 Fairfax Boulevard
Entity, Address, City or Town Fairfax
Entity, Address, State or Province VA
Entity, Address, Postal Zip Code 22030
City Area Code 703
Local Phone Number 481-4567
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity, Emerging Growth Company true
Entity, Ex Transition Period true
Amendment Flag false
Entity, Central Index Key 0001693577
CommonStock Custom [Member]  
Document Information [Line Items]  
Title of 12(b) Security Common Stock
Trading Symbol MNSB
Security Exchange Name NASDAQ
DepositaryShares Custom [Member]  
Document Information [Line Items]  
Title of 12(b) Security Depositary Shares
Trading Symbol MNSBP
Security Exchange Name NASDAQ

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