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PRESS RELEASE: Paid content from PR Newswire
Press release content from PR Newswire. The AP news staff was not involved in its creation.

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

January 20, 2022 GMT
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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:

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  • 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

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.

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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




60




55




55




108


Interest on savings and NOW deposits



165




221




38




38




47




42




52


Interest on money market deposits



772




2,162




127




148




220




277




418


Interest on time deposits



7,613




12,322




1,574




1,795




1,994




2,250




2,583


Interest on Federal Home Loan Bank

advances and other borrowings






107

















Interest on subordinated debt



1,884




966




539




541




567




238




240


Total interest expense



10,663




16,095




2,337




2,582




2,883




2,862




3,401


Net interest income



53,536




45,977




13,866




13,203




12,991




13,475




13,066


Provision for (recovery of) loan losses



(1,175)




3,610




295




290




(2,080)




320




(2,950)


Net interest income after provision

for (recovery of) loan losses



54,711




42,367




13,571




12,913




15,071




13,155




16,016


NON-INTEREST INCOME:





























Deposit account service charges



2,426




1,916




624




642




621




539




509


Bank owned life insurance income



900




779




253




252




218




177




183


Loan swap fee income



83




3,510




83













833


Net gain on held-to-maturity securities



6







3










3





Net gain (loss) on sale of loans



847




33




413




(40)




130




344





Other fee income



1,848




1,213




247




632




586




383




378


Total other income



6,110




7,451




1,623




1,486




1,555




1,446




1,903


NON-INTEREST EXPENSES:





























Salaries and employee benefits



19,305




17,937




5,029




4,847




4,663




4,767




4,746


Furniture and equipment expenses



2,468




2,128




726




716




500




526




601


Advertising and marketing



1,565




1,003




450




438




402




275




290


Occupancy expenses



1,541




1,270




449




399




387




306




360


Outside services



1,394




959




485




292




280




336




263


Administrative expenses



685




674




192




202




141




150




166


Other operating expenses



5,907




6,287




1,389




1,567




1,500




1,449




1,732


Total other expenses



32,865




30,258




8,720




8,461




7,873




7,809




8,158


Income before income tax expense



27,956




19,560




6,474




5,938




8,753




6,792




9,761


Income tax expense



5,785




3,843




1,660




1,155




1,627




1,342




2,051


Net Income



22,171




15,717




4,814




4,783




7,126




5,450




7,710


Preferred stock dividends



2,156




635




539




539




539




539




635


Net income available to common shareholders


$

20,015



$

15,082



$

4,275



$

4,244



$

6,587



$

4,911



$

7,075


Net income per common share,

basic and diluted


$

2.65



$

1.85



$

0.56



$

0.56



$

0.87



$

0.65



$

0.92


Weighted average number of common shares,

basic and diluted



7,559,310




8,131,334




7,595,062




7,571,214




7,546,452




7,523,547




7,700,470


UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL

(In thousands)




December 31, 2021



September 30, 2021



December 31, 2020



Percentage Change




$ Amount



% of

Total



$ Amount



% of

Total



$ Amount



% of

Total



Last

3 Mos



Last

12 Mos


LOANS:

































Construction and land development loans


$

337,173




24.8

%


$

327,004




25.9

%


$

324,906




26.0

%



3.1

%



3.8

%

Residential real estate loans



300,389




22.1

%



223,029




17.6

%



183,531




14.7

%



34.7

%



63.7

%

Commercial real estate loans



534,188




39.3

%



494,766




39.1

%



466,898




37.4

%



8.0

%



14.4

%

Commercial industrial loans - Other



105,675




7.8

%



102,747




8.1

%



94,847




7.6

%



2.8

%



11.4

%

Commercial industrial loans - PPP Loans



58,339




4.3

%



88,534




7.0

%



135,180




10.8

%



-34.1

%



-56.8

%

Consumer loans



23,171




1.7

%



27,740




2.3

%



44,073




3.5

%



-16.5

%



-47.4

%

Total Gross Loans


$

1,358,935




100.0

%


$

1,263,820




100.0

%


$

1,249,435




100.0

%



7.5

%



8.8

%

Less: Allowance for loan losses



(11,697)








(11,428)








(12,877)














Net deferred loan fees



(5,478)








(6,061)








(6,179)














Net Loans


$

1,341,760







$

1,246,331







$

1,230,379














DEPOSITS:

































Non-interest bearing demand deposits


$

530,678




37.6

%


$

475,157




33.6

%


$

370,497




25.8

%



11.7

%



43.2

%

Interest-bearing demand deposits:

































Demand deposits



69,232




4.9

%



63,622




4.5

%



70,307




4.9

%



8.8

%



-1.5

%

Savings and NOW deposits



85,175




6.0

%



79,556




5.6

%



74,099




5.2

%



7.1

%



14.9

%

Money market accounts



270,045




19.1

%



310,776




22.0

%



426,600




29.7

%



-13.1

%



-36.7

%

Certificates of deposit $250,000 or more



285,395




20.2

%



295,454




20.9

%



213,077




14.8

%



-3.4

%



33.9

%

Certificates of deposit less than $250,000



171,438




12.2

%



189,801




15.4

%



283,666




19.6

%



-9.7

%



-39.6

%

Total Deposits


$

1,411,963




100.0

%


$

1,414,366




100.0

%


$

1,438,246




100.0

%



-0.2

%



-1.8

%

BORROWINGS:

































Subordinated debt



29,294




100.0

%



40,635




100.0

%



14,834




100.0

%



-27.9

%



97.5

%

Total Borrowings


$

29,294




100.0

%


$

40,635




100.0

%


$

14,834




100.0

%



-27.9

%



97.5

%

Total Deposits and Borrowings


$

1,441,257







$

1,455,001







$

1,453,080








-0.9

%



-0.8

%


































Core customer funding sources (1)


$

1,108,177




76.9

%


$

1,097,948




75.5

%


$

1,046,087




72.0

%



0.9

%



5.9

%

Brokered and listing service sources (2)



303,786




21.1

%



316,418




21.7

%



392,159




27.0

%



-4.0

%



-22.5

%

Subordinated debt (3)



29,294




2.0

%



40,635




2.8

%



14,834




1.0

%



-27.9

%



97.5

%

Total Funding Sources


$

1,441,257




100.0

%


$

1,455,001




100.0

%


$

1,453,080




100.0

%



-0.9

%



-0.8

%



(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

(3)

Subordinated debt obligation qualifies as Tier 2 capital at the holding company and Tier 1 capital at the Bank

UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES

(In thousands)




For the three months ended December 31, 2021



For the three months ended December 31, 2020




Average

Balance



Interest

Income/

Expense



Average

Yields/ Rate

(annualized)



Average

Balance



Interest

Income/

Expense



Average

Yields/ Rate

(annualized)


ASSETS:

























Interest earning assets:

























Loans (1)(2)(3)


$

1,203,764



$

15,532




5.12

%


$

1,311,726



$

15,933




4.83

%

Investment securities



115,712




610




2.09

%



85,084




519




2.43

%

Federal funds and interest-bearing deposits



192,442




61




0.13

%



171,933




15




0.03

%

Total interest earning assets


$

1,511,918



$

16,203




4.25

%


$

1,568,743



$

16,467




4.18

%

Other assets



161,136












71,013










Total assets


$

1,673,054











$

1,639,756










Liabilities and Stockholders' Equity:

























Interest-bearing liabilities:

























Interest-bearing demand deposits


$

69,532



$

59




0.34

%


$

71,906



$

108




0.60

%

Savings and NOW deposits



82,048




38




0.18

%



70,542




52




0.29

%

Money market deposit accounts



296,063




127




0.17

%



390,645




418




0.43

%

Time deposits



466,190




1,574




1.34

%



509,963




2,583




2.02

%

Total interest-bearing deposits


$

913,833



$

1,798




0.78

%


$

1,043,056



$

3,161




1.21

%

Subordinated debt



40,297




539




5.31

%



14,823




240




6.44

%

FHLB borrowings



1










4,511








Total interest-bearing liabilities


$

954,131



$

2,337




0.97

%


$

1,062,390



$

3,401




1.27

%

Demand deposits and other liabilities



532,216












428,726










Total liabilities


$

1,486,347











$

1,491,116










Stockholders' Equity



186,707












148,043










Total Liabilities and Stockholders' Equity


$

1,673,054











$

1,639,159










Interest Rate Spread











3.28

%











2.91

%

Net Interest Income






$

13,866











$

13,066






Net Interest Margin











3.64

%











3.31

%

Net Interest Margin, excluding PPP loans(4)











3.49

%











3.19

%



(1)

Includes loans classified as non-accrual

(2)

Includes average PPP balances of $74.1 million, related interest income of approximately $185,000, and $1.0 million in PPP fees recognized for the three months ended December 31, 2021

(3)

Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs

(4)

Refer to Appendix for reconciliation of non-GAAP measures

UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES

(In thousands)




For the year ended December 31, 2021



For the year ended December 31, 2020




Average

Balance



Interest

Income/

Expense



Average

Yields/ Rate

(annualized)



Average

Balance



Interest

Income/

Expense



Average

Yields/ Rate

(annualized)


ASSETS:

























Interest earning assets:

























Loans (1)(2)(3)


$

1,165,907



$

61,743




5.30

%


$

1,219,525



$

59,634




4.89

%

Investment securities



99,902




2,322




2.32

%



76,414




2,007




2.63

%

Federal funds and interest-bearing deposits



216,436




134




0.06

%



135,688




431




0.32

%

Total interest earning assets


$

1,482,245



$

64,199




4.33

%


$

1,431,627



$

62,072




4.34

%

Other assets



202,895












66,561










Total assets


$

1,685,140











$

1,498,188










Liabilities and Stockholders' Equity:

























Interest-bearing liabilities:

























Interest-bearing demand deposits


$

67,897



$

229




0.34

%


$

37,431



$

317




0.85

%

Savings and NOW deposits



74,975




165




0.22

%



66,028




221




0.33

%

Money market deposit accounts



333,160




772




0.23

%



314,398




2,162




0.69

%

Time deposits



498,001




7,613




1.53

%



535,116




12,322




2.30

%

Total interest-bearing deposits


$

974,033



$

8,779




0.90

%


$

952,973



$

15,022




1.58

%

Subordinated debt



33,953




1,884




5.55

%



14,820




966




6.52

%

FHLB borrowings












6,189




107




1.73

%

Total interest-bearing liabilities


$

1,007,986



$

10,663




1.06

%


$

973,982



$

16,095




1.65

%

Demand deposits and other liabilities



498,031












375,046










Total liabilities


$

1,506,017











$

1,349,028










Stockholders' Equity



179,123












149,160










Total Liabilities and Stockholders' Equity


$

1,685,140











$

1,498,188










Interest Rate Spread











3.27

%











2.69

%

Net Interest Income






$

53,536











$

45,977






Net Interest Margin











3.61

%











3.21

%

Net Interest Margin, excluding PPP loans(4)











3.48

%











3.21

%



(1)

Includes loans classified as non-accrual and loans held for sale

(2)

Includes average PPP balances of $123.5 million, related interest income of approximately $1.2 million, and $5.0 million in PPP fees recognized for the year ended December 31, 2021

(3)

Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs

(4)

Refer to Appendix for reconciliation of non-GAAP measures

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,




2021



2020


2021



2020


Per share Data and Shares Outstanding
















Earnings per common share (basic and diluted)


$

0.56



$

0.92


$

2.65



$

1.85


Book value per common share


$

21.27



$

18.86


$

21.27



$

18.86


Tangible book value per common share(2)


$

20.94



$

18.86


$

20.94



$

18.86


Weighted average common shares (basic and diluted)



7,595,062




7,700,470



7,559,310




8,131,334


Common shares outstanding at end of period



7,595,781




7,443,842



7,595,781




7,443,842


Performance Ratios
















Return on average assets (annualized)



1.14

%



1.88

%


1.32

%



1.05

%

Return on average assets, excluding impact of PPP loans (annualized)(2)



0.90

%



1.61

%


1.02

%



0.87

%

Return on average equity (annualized)



10.23

%



18.44

%


12.38

%



10.54

%

Return on average common equity (annualized)



10.63

%



20.05

%


13.18

%



10.68

%

Yield on earning assets (annualized)



4.25

%



4.18

%


4.33

%



4.34

%

Cost of interest bearing liabilities (annualized)



0.97

%



1.27

%


1.06

%



1.65

%

Net interest spread



3.28

%



2.91

%


3.27

%



2.69

%

Net interest margin (annualized)



3.64

%



3.31

%


3.61

%



3.21

%

Net interest margin, excluding PPP loans (annualized)(2)



3.49

%



3.19

%


3.48

%



3.21

%

Noninterest income as a percentage of average assets (annualized)



0.38

%



0.46

%


0.36

%



0.50

%

Noninterest expense to average assets (annualized)



2.07

%



1.99

%


1.95

%



2.02

%

Efficiency ratio(3)



56.31

%



54.50

%


55.10

%



56.67

%

Asset Quality
















Commercial real estate loans to total capital (4)



367.88

%



365.80

%


367.88

%



365.80

%

Construction loans to total capital (5)



148.30

%



171.42

%


148.30

%



171.42

%

Loans 30-89 days past due to total gross loans



0.01

%



0.01

%


0.01

%



0.01

%

Loans 90 days past due to total gross loans



0.00

%



0.00

%


0.00

%



0.00

%

Non-accrual loans to total gross loans



0.00

%



0.01

%


0.00

%



0.01

%

Other real estate owned


$

775



$

1,180


$

775



$

1,180


Non-performing assets


$

775



$

1,330


$

775



$

1,330


Non-performing assets to total assets



0.05

%



0.08

%


0.05

%



0.08

%

Non-performing assets to total assets, excluding PPP loans(2)



0.05

%



0.09

%


0.05

%



0.09

%

Allowance for loan losses to total gross loans



0.86

%



1.03

%


0.86

%



1.03

%

Allowance for loan losses to total loans, excluding PPP loans(2)



0.90

%



1.16

%


0.90

%



1.16

%

Allowance for loan losses to non-performing assets



15.09




9.68



15.09




9.68


Net loan charge-offs (recoveries)


$

26



$

(1,480)


$

5



$

317


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



0.01

%



(0.45)

%


0.00

%



0.03

%

Net charge-offs (recoveries) to average gross loans, excluding PPP loans (annualized)(2)



0.01

%



(0.51)

%


0.00

%



0.03

%

Regulatory Capital Ratios (Bank only) (1)
















Total risk-based capital ratio



16.06

%



14.60

%


16.06

%



14.60

%

Tier 1 risk-based capital ratio



15.23

%



13.61

%


15.23

%



13.61

%

Leverage ratio



12.89

%



10.78

%


12.89

%



10.78

%

Common equity tier 1 ratio



15.23

%



13.61

%


15.23

%



13.61

%

Other information
















Closing stock price


$

24.59



$

16.91


$

24.59



$

16.91


Equity / assets



11.46

%



10.20

%


11.46

%



10.20

%

Equity / assets, excluding PPP loans(2)



11.88

%



11.12

%


11.88

%



11.12

%

Average equity / average assets



11.16

%



9.96

%


10.63

%



10.00

%

Average equity / average assets, less average PPP loans(2)



11.68

%



11.29

%


11.47

%



10.80

%

Number of full time equivalent employees



138




126



138




126


# Full service branch offices



6




7



6




7




(1)

Regulatory capital ratios as of December 31, 2021 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 non-owner occupied and construction loans as a percentage of Bank capital

(5)

Construction loans as a percentage of Bank capital

Reconciliation of Certain Non-GAAP Financial Measures

(Dollars In thousands)




For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Paycheck Protection Program adjustment impact

















Loans held for investment (GAAP)


$

1,358,935



$

1,249,435



$

1,358,935



$

1,249,435


Less: PPP loans



58,339




135,180




58,339




135,180


Loans held for investment, excluding PPP (non-GAAP)


$

1,300,596



$

1,114,255



$

1,300,596



$

1,114,255



















Average loans held for investment (GAAP)


$

1,203,764



$

1,311,726



$

1,165,907



$

1,219,525


Less: Average PPP loans



74,064




157,787




123,538




116,690


Average loans held for investment, excluding PPP (non-GAAP)


$

1,129,700



$

1,153,939



$

1,042,369




1,102,835











For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Net interest margin adjustment

















Net interest income (GAAP)


$

13,866



$

13,066



$

53,536



$

45,977


Less: PPP fees recognized



1,015




1,363




4,973




2,598


Less: PPP interest income earned



185




394




1,235




1,167


Net interest income, excluding PPP income (non-GAAP)



12,666




11,309




47,328




42,212



















Average interest earning assets (GAAP)



1,511,918




1,568,743




1,482,245




1,431,627


Less: average PPP loans



74,064




157,787




123,538




116,690


Average interest earning assets, excluding PPP (non-GAAP)



1,437,854




1,410,956




1,358,707




1,314,937



















Net interest margin (GAAP)



3.64

%



3.31

%



3.61

%



3.21

%

Net interest margin, excluding PPP (non-GAAP)



3.49

%



3.19

%



3.48

%



3.21

%










For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Total asset adjustment

















Total assets (GAAP)


$

1,647,402



$

1,643,165



$

1,647,402



$

1,643,165


Less: PPP loans



58,339




135,180




58,339




135,180


Total assets, excluding PPP loans (non-GAAP)



1,589,063




1,507,985




1,589,063




1,507,985



















Total equity (GAAP)



188,788




167,665




188,788




167,665


Equity / assets, excluding PPP loans (non-GAAP)



11.88

%



11.12

%



11.88

%



11.12

%


















Average asset adjustment

















Average assets (GAAP)



1,673,054




1,639,756




1,685,140




1,498,188


Less: average PPP loans



74,064




157,787




123,538




116,690


Total average assets, excluding average PPP loans



1,598,990




1,481,969




1,561,602




1,381,498



















Total average equity (GAAP)



186,707




167,288




179,123




149,160


Average equity / average assets, excluding average PPP loans (non-GAAP)



11.68

%



11.29

%



11.47

%



10.80

%










For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Return on Average Assets, adjusted

















Net income (GAAP)


$

4,814



$

7,710



$

22,171



$

15,717


Less: PPP fees recognized



1,015




1,363




4,973




2,598


Less: PPP interest income earned



185




394




1,235




1,167


Net income, excluding PPP income (non-GAAP)



3,614




5,953




15,963




11,952



















Average total assets



1,673,054




1,639,756




1,685,140




1,498,188


Less: average PPP loans



74,064




157,787




123,538




116,690


Average total assets, excluding PPP (non-GAAP)



1,598,990




1,481,969




1,561,602




1,381,498


Return on average assets, excluding PPP (non-GAAP)



0.90

%



1.61

%



1.02

%



0.87

%










For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Nonperforming Assets to total assets, adjusted

















Total nonperforming assets (GAAP)


$

775



$

1,330



$

775



$

1,330



















Total assets (GAAP)



1,647,402




1,643,165




1,647,402




1,643,165


Less: PPP loans



58,339




135,180




58,339




135,180


Total assets, excluding PPP loans (non-GAAP)



1,589,063




1,507,985




1,589,063




1,507,985


Nonperforming assets to total assets, excluding PPP loans (non-GAAP)



0.05

%



0.09

%



0.05

%



0.09

%










For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Allowance for loan losses, adjusted

















Allowance for loan losses (GAAP)


$

11,697



$

12,877



$

11,697



$

12,877



















Total gross loans (GAAP)



1,358,935




1,249,435




1,358,935




1,249,435


Less: PPP loans



58,339




135,180




58,339




135,180


Total gross loans, excluding PPP loans (non-GAAP)



1,300,596




1,114,255




1,300,596




1,114,255


Allowance for loan losses to total loans, excluding PPP (non-GAAP)



0.90

%



1.16

%



0.90

%



1.16

%



For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Net charge-offs to average loans, adjusted

















Total net charge-offs (recoveries) (GAAP)


$

26




(1,480)



$

5



$

317



















Total average gross loans (GAAP)



1,203,764




1,311,726




1,165,907




1,219,525


Less: average PPP loans



74,064




157,787




123,538




116,690


Total average gross loans, excluding PPP loans (non-GAAP)



1,129,700




1,153,939




1,042,369




1,102,835


Net charge-offs (recoveries) to average gross loans, excluding PPP (annualized) (non-GAAP)



0.01

%



(0.51)

%



0.00

%



0.03

%










For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Stockholders equity, adjusted

















Total common stockholders equity


$

161,525




140,402



$

161,525



$

140,402


Less: intangible assets



2,493







2,493





Tangible common stockholders equity



159,032




140,402




159,032




140,402



















Shares outstanding



7,595,781




7,443,842




7,595,781




7,443,842


Tangible book value per common share


$

20.94



$

18.86



$

20.94



$

18.86









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




60




55




55




108


Interest on savings and NOW deposits



165




221




38




38




47




42




52


Interest on money market deposits



772




2,162




127




148




220




277




418


Interest on time deposits



7,613




12,322




1,574




1,795




1,994




2,250




2,583


Interest on Federal Home Loan Bank

advances and other borrowings






107

















Interest on subordinated debt



1,884




966




539




541




567




238




240


Total interest expense



10,663




16,095




2,337




2,582




2,883




2,862




3,401


Net interest income



53,536




45,977




13,866




13,203




12,991




13,475




13,066


Provision for (recovery of) loan losses



(1,175)




3,610




295




290




(2,080)




320




(2,950)


Net interest income after provision

for (recovery of) loan losses



54,711




42,367




13,571




12,913




15,071




13,155




16,016


NON-INTEREST INCOME:





























Deposit account service charges



2,426




1,916




624




642




621




539




509


Bank owned life insurance income



900




779




253




252




218




177




183


Loan swap fee income



83




3,510




83













833


Net gain on held-to-maturity securities



6







3










3





Net gain (loss) on sale of loans



847




33




413




(40)




130




344





Other fee income



1,848




1,213




247




632




586




383




378


Total other income



6,110




7,451




1,623




1,486




1,555




1,446




1,903


NON-INTEREST EXPENSES:





























Salaries and employee benefits



19,305




17,937




5,029




4,847




4,663




4,767




4,746


Furniture and equipment expenses



2,468




2,128




726




716




500




526




601


Advertising and marketing



1,565




1,003




450




438




402




275




290


Occupancy expenses



1,541




1,270




449




399




387




306




360


Outside services



1,394




959




485




292




280




336




263


Administrative expenses



685




674




192




202




141




150




166


Other operating expenses



5,907




6,287




1,389




1,567




1,500




1,449




1,732


Total other expenses



32,865




30,258




8,720




8,461




7,873




7,809




8,158


Income before income tax expense



27,956




19,560




6,474




5,938




8,753




6,792




9,761


Income tax expense



5,785




3,843




1,660




1,155




1,627




1,342




2,051


Net Income



22,171




15,717




4,814




4,783




7,126




5,450




7,710


Preferred stock dividends



2,156




635




539




539




539




539




635


Net income available to common shareholders


$

20,015



$

15,082



$

4,275



$

4,244



$

6,587



$

4,911



$

7,075


Net income per common share,

basic and diluted


$

2.65



$

1.85



$

0.56



$

0.56



$

0.87



$

0.65



$

0.92


Weighted average number of common shares,

basic and diluted



7,559,310




8,131,334




7,595,062




7,571,214




7,546,452




7,523,547




7,700,470


UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL

(In thousands)




December 31, 2021



September 30, 2021



December 31, 2020



Percentage Change




$ Amount



% of

Total



$ Amount



% of

Total



$ Amount



% of

Total



Last

3 Mos



Last

12 Mos


LOANS:

































Construction and land development loans


$

337,173




24.8

%


$

327,004




25.9

%


$

324,906




26.0

%



3.1

%



3.8

%

Residential real estate loans



300,389




22.1

%



223,029




17.6

%



183,531




14.7

%



34.7

%



63.7

%

Commercial real estate loans



534,188




39.3

%



494,766




39.1

%



466,898




37.4

%



8.0

%



14.4

%

Commercial industrial loans - Other



105,675




7.8

%



102,747




8.1

%



94,847




7.6

%



2.8

%



11.4

%

Commercial industrial loans - PPP Loans



58,339




4.3

%



88,534




7.0

%



135,180




10.8

%



-34.1

%



-56.8

%

Consumer loans



23,171




1.7

%



27,740




2.3

%



44,073




3.5

%



-16.5

%



-47.4

%

Total Gross Loans


$

1,358,935




100.0

%


$

1,263,820




100.0

%


$

1,249,435




100.0

%



7.5

%



8.8

%

Less: Allowance for loan losses



(11,697)








(11,428)








(12,877)














Net deferred loan fees



(5,478)








(6,061)








(6,179)














Net Loans


$

1,341,760







$

1,246,331







$

1,230,379














DEPOSITS:

































Non-interest bearing demand deposits


$

530,678




37.6

%


$

475,157




33.6

%


$

370,497




25.8

%



11.7

%



43.2

%

Interest-bearing demand deposits:

































Demand deposits



69,232




4.9

%



63,622




4.5

%



70,307




4.9

%



8.8

%



-1.5

%

Savings and NOW deposits



85,175




6.0

%



79,556




5.6

%



74,099




5.2

%



7.1

%



14.9

%

Money market accounts



270,045




19.1

%



310,776




22.0

%



426,600




29.7

%



-13.1

%



-36.7

%

Certificates of deposit $250,000 or more



285,395




20.2

%



295,454




20.9

%



213,077




14.8

%



-3.4

%



33.9

%

Certificates of deposit less than $250,000



171,438




12.2

%



189,801




15.4

%



283,666




19.6

%



-9.7

%



-39.6

%

Total Deposits


$

1,411,963




100.0

%


$

1,414,366




100.0

%


$

1,438,246




100.0

%



-0.2

%



-1.8

%

BORROWINGS:

































Subordinated debt



29,294




100.0

%



40,635




100.0

%



14,834




100.0

%



-27.9

%



97.5

%

Total Borrowings


$

29,294




100.0

%


$

40,635




100.0

%


$

14,834




100.0

%



-27.9

%



97.5

%

Total Deposits and Borrowings


$

1,441,257







$

1,455,001







$

1,453,080








-0.9

%



-0.8

%


































Core customer funding sources (1)


$

1,108,177




76.9

%


$

1,097,948




75.5

%


$

1,046,087




72.0

%



0.9

%



5.9

%

Brokered and listing service sources (2)



303,786




21.1

%



316,418




21.7

%



392,159




27.0

%



-4.0

%



-22.5

%

Subordinated debt (3)



29,294




2.0

%



40,635




2.8

%



14,834




1.0

%



-27.9

%



97.5

%

Total Funding Sources


$

1,441,257




100.0

%


$

1,455,001




100.0

%


$

1,453,080




100.0

%



-0.9

%



-0.8

%



(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

(3)

Subordinated debt obligation qualifies as Tier 2 capital at the holding company and Tier 1 capital at the Bank

UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES

(In thousands)




For the three months ended December 31, 2021



For the three months ended December 31, 2020




Average

Balance



Interest

Income/

Expense



Average

Yields/ Rate

(annualized)



Average

Balance



Interest

Income/

Expense



Average

Yields/ Rate

(annualized)


ASSETS:

























Interest earning assets:

























Loans (1)(2)(3)


$

1,277,828



$

15,532




4.82

%


$

1,311,726



$

15,933




4.83

%

Investment securities



115,712




610




2.09

%



85,084




519




2.43

%

Federal funds and interest-bearing deposits



192,442




61




0.13

%



171,933




15




0.03

%

Total interest earning assets


$

1,585,982



$

16,203




4.05

%


$

1,568,743



$

16,467




4.18

%

Other assets



87,072












71,013










Total assets


$

1,673,054











$

1,639,756










Liabilities and Stockholders' Equity:

























Interest-bearing liabilities:

























Interest-bearing demand deposits


$

69,532



$

59




0.34

%


$

71,906



$

108




0.60

%

Savings and NOW deposits



82,048




38




0.18

%



70,542




52




0.29

%

Money market deposit accounts



296,063




127




0.17

%



390,645




418




0.43

%

Time deposits



466,190




1,574




1.34

%



509,963




2,583




2.02

%

Total interest-bearing deposits


$

913,833



$

1,798




0.78

%


$

1,043,056



$

3,161




1.21

%

Subordinated debt



40,297




539




5.31

%



14,823




240




6.44

%

FHLB borrowings



1










4,511








Total interest-bearing liabilities


$

954,131



$

2,337




0.97

%


$

1,062,390



$

3,401




1.27

%

Demand deposits and other liabilities



532,216












428,726










Total liabilities


$

1,486,347











$

1,491,116










Stockholders' Equity



186,707












148,043










Total Liabilities and Stockholders' Equity


$

1,673,054











$

1,639,159










Interest Rate Spread











3.08

%











2.91

%

Net Interest Income






$

13,866











$

13,066






Net Interest Margin











3.47

%











3.31

%

Net Interest Margin, excluding PPP loans(4)











3.32

%











3.19

%



(1)

Includes loans classified as non-accrual

(2)

Includes average PPP balances of $74.1 million, related interest income of approximately $185,000, and $1.0 million in PPP fees recognized for the three months ended December 31, 2021

(3)

Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs

(4)

Refer to Appendix for reconciliation of non-GAAP measures

UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES

(In thousands)




For the year ended December 31, 2021



For the year ended December 31, 2020




Average

Balance



Interest

Income/

Expense



Average

Yields/ Rate

(annualized)



Average

Balance



Interest

Income/

Expense



Average

Yields/ Rate

(annualized)


ASSETS:

























Interest earning assets:

























Loans (1)(2)(3)


$

1,289,445



$

61,743




4.79

%


$

1,219,525



$

59,634




4.89

%

Investment securities



99,902




2,322




2.32

%



76,414




2,007




2.63

%

Federal funds and interest-bearing deposits



216,436




134




0.06

%



135,688




431




0.32

%

Total interest earning assets


$

1,605,783



$

64,199




4.00

%


$

1,431,627



$

62,072




4.34

%

Other assets



79,357












66,561










Total assets


$

1,685,140











$

1,498,188










Liabilities and Stockholders' Equity:

























Interest-bearing liabilities:

























Interest-bearing demand deposits


$

67,897



$

229




0.34

%


$

37,431



$

317




0.85

%

Savings and NOW deposits



74,975




165




0.22

%



66,028




221




0.33

%

Money market deposit accounts



333,160




772




0.23

%



314,398




2,162




0.69

%

Time deposits



498,001




7,613




1.53

%



535,116




12,322




2.30

%

Total interest-bearing deposits


$

974,033



$

8,779




0.90

%


$

952,973



$

15,022




1.58

%

Subordinated debt



33,953




1,884




5.55

%



14,820




966




6.52

%

FHLB borrowings












6,189




107




1.73

%

Total interest-bearing liabilities


$

1,007,986



$

10,663




1.06

%


$

973,982



$

16,095




1.65

%

Demand deposits and other liabilities



498,031












375,046










Total liabilities


$

1,506,017











$

1,349,028










Stockholders' Equity



179,123












149,160










Total Liabilities and Stockholders' Equity


$

1,685,140











$

1,498,188










Interest Rate Spread











2.94

%











2.69

%

Net Interest Income






$

53,536











$

45,977






Net Interest Margin











3.33

%











3.21

%

Net Interest Margin, excluding PPP loans(4)











3.19

%











3.21

%



(1)

Includes loans classified as non-accrual and loans held for sale

(2)

Includes average PPP balances of $123.5 million, related interest income of approximately $1.2 million, and $5.0 million in PPP fees recognized for the year ended December 31, 2021

(3)

Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs

(4)

Refer to Appendix for reconciliation of non-GAAP measures

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,




2021



2020


2021



2020


Per share Data and Shares Outstanding
















Earnings per common share (basic and diluted)


$

0.56



$

0.92


$

2.65



$

1.85


Book value per common share


$

21.27



$

18.86


$

21.27



$

18.86


Tangible book value per common share(2)


$

20.94



$

18.86


$

20.94



$

18.86


Weighted average common shares (basic and diluted)



7,595,062




7,700,470



7,559,310




8,131,334


Common shares outstanding at end of period



7,595,781




7,443,842



7,595,781




7,443,842


Performance Ratios
















Return on average assets (annualized)



1.14

%



1.88

%


1.32

%



1.05

%

Return on average assets, excluding impact of PPP loans (annualized)(2)



0.90

%



1.61

%


1.02

%



0.87

%

Return on average equity (annualized)



10.23

%



18.44

%


12.38

%



10.54

%

Return on average common equity (annualized)



10.63

%



20.05

%


13.18

%



10.68

%

Yield on earning assets (annualized)



4.05

%



4.18

%


4.00

%



4.34

%

Cost of interest bearing liabilities (annualized)



0.97

%



1.27

%


1.06

%



1.65

%

Net interest spread



3.08

%



2.91

%


2.94

%



2.69

%

Net interest margin (annualized)



3.47

%



3.31

%


3.33

%



3.21

%

Net interest margin, excluding PPP loans (annualized)(2)



3.32

%



3.19

%


3.19

%



3.21

%

Noninterest income as a percentage of average assets (annualized)



0.38

%



0.46

%


0.36

%



0.50

%

Noninterest expense to average assets (annualized)



2.07

%



1.99

%


1.95

%



2.02

%

Efficiency ratio(3)



56.31

%



54.50

%


55.10

%



56.67

%

Asset Quality
















Commercial real estate loans to total capital (4)



367.88

%



365.80

%


367.88

%



365.80

%

Construction loans to total capital (5)



148.30

%



171.42

%


148.30

%



171.42

%

Loans 30-89 days past due to total gross loans



0.01

%



0.01

%


0.01

%



0.01

%

Loans 90 days past due to total gross loans



0.00

%



0.00

%


0.00

%



0.00

%

Non-accrual loans to total gross loans



0.00

%



0.01

%


0.00

%



0.01

%

Other real estate owned


$

775



$

1,180


$

775



$

1,180


Non-performing assets


$

775



$

1,330


$

775



$

1,330


Non-performing assets to total assets



0.05

%



0.08

%


0.05

%



0.08

%

Non-performing assets to total assets, excluding PPP loans(2)



0.05

%



0.09

%


0.05

%



0.09

%

Allowance for loan losses to total gross loans



0.86

%



1.03

%


0.86

%



1.03

%

Allowance for loan losses to total loans, excluding PPP loans(2)



0.90

%



1.16

%


0.90

%



1.16

%

Allowance for loan losses to non-performing assets



15.09




9.68



15.09




9.68


Net loan charge-offs (recoveries)


$

26



$

(1,480)


$

5



$

317


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



0.01

%



(0.45)

%


0.00

%



0.03

%

Net charge-offs (recoveries) to average gross loans, excluding PPP loans (annualized)(2)



0.01

%



(0.51)

%


0.00

%



0.03

%

Regulatory Capital Ratios (Bank only) (1)
















Total risk-based capital ratio



16.06

%



14.60

%


16.06

%



14.60

%

Tier 1 risk-based capital ratio



15.23

%



13.61

%


15.23

%



13.61

%

Leverage ratio



12.89

%



10.78

%


12.89

%



10.78

%

Common equity tier 1 ratio



15.23

%



13.61

%


15.23

%



13.61

%

Other information
















Closing stock price


$

24.59



$

16.91


$

24.59



$

16.91


Equity / assets



11.46

%



10.20

%


11.46

%



10.20

%

Equity / assets, excluding PPP loans(2)



11.88

%



11.12

%


11.88

%



11.12

%

Average equity / average assets



11.16

%



9.96

%


10.63

%



10.00

%

Average equity / average assets, less average PPP loans(2)



11.68

%



11.29

%


11.47

%



10.80

%

Number of full time equivalent employees



138




126



138




126


# Full service branch offices



6




7



6




7




(1)

Regulatory capital ratios as of December 31, 2021 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 non-owner occupied and construction loans as a percentage of Bank capital

(5)

Construction loans as a percentage of Bank capital

Reconciliation of Certain Non-GAAP Financial Measures

(Dollars In thousands)




For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Paycheck Protection Program adjustment impact

















Loans held for investment (GAAP)


$

1,358,935



$

1,249,435



$

1,358,935



$

1,249,435


Less: PPP loans



58,339




135,180




58,339




135,180


Loans held for investment, excluding PPP (non-GAAP)


$

1,300,596



$

1,114,255



$

1,300,596



$

1,114,255



















Average loans held for investment (GAAP)


$

1,203,764



$

1,311,726



$

1,165,907



$

1,219,525


Less: Average PPP loans



74,064




157,787




123,538




116,690


Average loans held for investment, excluding PPP (non-GAAP)


$

1,129,700



$

1,153,939



$

1,042,369




1,102,835











For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Net interest margin adjustment

















Net interest income (GAAP)


$

13,866



$

13,066



$

53,536



$

45,977


Less: PPP fees recognized



1,015




1,363




4,973




2,598


Less: PPP interest income earned



185




394




1,235




1,167


Net interest income, excluding PPP income (non-GAAP)



12,666




11,309




47,328




42,212



















Average interest earning assets (GAAP)



1,585,982




1,568,743




1,605,783




1,431,627


Less: average PPP loans



74,064




157,787




123,538




116,690


Average interest earning assets, excluding PPP (non-GAAP)



1,511,918




1,410,956




1,482,245




1,314,937



















Net interest margin (GAAP)



3.47

%



3.31

%



3.33

%



3.21

%

Net interest margin, excluding PPP (non-GAAP)



3.32

%



3.19

%



3.19

%



3.21

%










For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Total asset adjustment

















Total assets (GAAP)


$

1,647,402



$

1,643,165



$

1,647,402



$

1,643,165


Less: PPP loans



58,339




135,180




58,339




135,180


Total assets, excluding PPP loans (non-GAAP)



1,589,063




1,507,985




1,589,063




1,507,985



















Total equity (GAAP)



188,788




167,665




188,788




167,665


Equity / assets, excluding PPP loans (non-GAAP)



11.88

%



11.12

%



11.88

%



11.12

%


















Average asset adjustment

















Average assets (GAAP)



1,673,054




1,639,756




1,685,140




1,498,188


Less: average PPP loans



74,064




157,787




123,538




116,690


Total average assets, excluding average PPP loans



1,598,990




1,481,969




1,561,602




1,381,498



















Total average equity (GAAP)



186,707




167,288




179,123




149,160


Average equity / average assets, excluding average PPP loans (non-GAAP)



11.68

%



11.29

%



11.47

%



10.80

%










For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Return on Average Assets, adjusted

















Net income (GAAP)


$

4,814



$

7,710



$

22,171



$

15,717


Less: PPP fees recognized



1,015




1,363




4,973




2,598


Less: PPP interest income earned



185




394




1,235




1,167


Net income, excluding PPP income (non-GAAP)



3,614




5,953




15,963




11,952



















Average total assets



1,673,054




1,639,756




1,685,140




1,498,188


Less: average PPP loans



74,064




157,787




123,538




116,690


Average total assets, excluding PPP (non-GAAP)



1,598,990




1,481,969




1,561,602




1,381,498


Return on average assets, excluding PPP (non-GAAP)



0.90

%



1.61

%



1.02

%



0.87

%










For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Nonperforming Assets to total assets, adjusted

















Total nonperforming assets (GAAP)


$

775



$

1,330



$

775



$

1,330



















Total assets (GAAP)



1,647,402




1,643,165




1,647,402




1,643,165


Less: PPP loans



58,339




135,180




58,339




135,180


Total assets, excluding PPP loans (non-GAAP)



1,589,063




1,507,985




1,589,063




1,507,985


Nonperforming assets to total assets, excluding PPP loans (non-GAAP)



0.05

%



0.09

%



0.05

%



0.09

%










For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Allowance for loan losses, adjusted

















Allowance for loan losses (GAAP)


$

11,697



$

12,877



$

11,697



$

12,877



















Total gross loans (GAAP)



1,358,935




1,249,435




1,358,935




1,249,435


Less: PPP loans



58,339




135,180




58,339




135,180


Total gross loans, excluding PPP loans (non-GAAP)



1,300,596




1,114,255




1,300,596




1,114,255


Allowance for loan losses to total loans, excluding PPP (non-GAAP)



0.90

%



1.16

%



0.90

%



1.16

%



For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Net charge-offs to average loans, adjusted

















Total net charge-offs (recoveries) (GAAP)


$

26




(1,480)



$

5



$

317



















Total average gross loans (GAAP)



1,203,764




1,311,726




1,165,907




1,219,525


Less: average PPP loans



74,064




157,787




123,538




116,690


Total average gross loans, excluding PPP loans (non-GAAP)



1,129,700




1,153,939




1,042,369




1,102,835


Net charge-offs (recoveries) to average gross loans, excluding PPP (annualized) (non-GAAP)



0.01

%



(0.51)

%



0.00

%



0.03

%










For the three months ended December 31,



For the year ended December 31,





2021




2020




2021




2020


Stockholders equity, adjusted

















Total common stockholders equity


$

161,525




140,402



$

161,525



$

140,402


Less: intangible assets



2,493







2,493





Tangible common stockholders equity



159,032




140,402




159,032




140,402



















Shares outstanding



7,595,781




7,443,842




7,595,781




7,443,842


Tangible book value per common share


$

20.94



$

18.86



$

20.94



$

18.86












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SOURCE MainStreet Bancshares, Inc.