Mainstreet Bancshares, Inc. · NASDAQ:MNSB
Mainstreet Bancshares — Q2 2021 Earnings Presentation
31 slides from Mainstreet Bancshares's earnings presentation, Sep 14, 2021
Slide 1: Financial Highlights for 2nd Quarter 2021
MainStreet Bancshares, Inc. Nasdaq: MNSB & MNSBP Financial Highlights for 2nd Quarter 2021 September 14, 2021
Slide 2: Forward-looking statements
This presentation 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 presentation that are not historical facts are forward-looking statements as defined in the Private Se
Slide 3: About MainStreet Bank
About MainStreet Bank As-Of June 30, 2021 (S&P Global Market Intelligence) Fairfax City Branch Will Close on 8.27.21
Slide 4: Washington D.C. metro market
The Washington D.C. metro area, and the Company’s primary footprint in Northern Virginia in particular, are among the most demographically appealing areas in the entire country, bringing people and companies to the region at a very significant rate. This also makes for a dynamic banking market that
Slide 5: Quarterly Income Comparison
Quarterly Income Comparison 2021 Q2 Income Interest Income: $15.9 Million Non-Interest Income: $1.6 Million Net Income: $7.1 Million Pre-tax, pre-provision income demonstrates the ability to generate capital for future credit exposure. Pre-Tax, Pre-Provision Income is a Non-GAAP measure. Pandemic An
Slide 6: Strong Growth Story
Strong Growth Story CAGR: 25% Lifetime1 2004 to 2020 Compound Annual Growth Rate. Total Assets ($MM)
Slide 7: Strong Loan Growth
Strong Loan Growth Loan Portfolio Composition as of 6/30/21 Total Gross Loan ($MM) CAGR: 21%1 Total Loans: $1.3B 2015 to 2020 Compound Annual Growth Rate.
Slide 8: Strong Deposit Growth
Strong Deposit Growth Deposit Composition as of 6/30/21 Noninterest-Bearing Deposits ($000) Total Deposits: $1.5B Noninterest-Bearing Deposits increased 31% YTD and account for 33% of all Deposits CAGR: 40.2%1 2015 to 2020 Compound Annual Growth Rate.
Slide 9: Cost of Deposits & Core Deposits
Cost of Deposits & Core Deposits 20Q2 to 21Q2 drop attributable to low interest rates and repricing of maturity deposits. Month-end data annualized on a 365-day basis. Cost of Interest-Bearing Deposits1 & Core Deposits / Total Deposits (%)
Slide 10: Net Interest Margin (NIM)
Net Interest Margin1 (NIM) Calculation Net Interest Income impacted by PPP rates Rates are at near zero on excess liquidity Net Interest Expense continues to show quarter-on-quarter improvement. NII / Avg Earning Assets & NIE / Avg Earning Assets 3.18% NIM Quarter-end data annualized on a 365-day ba
Slide 11: Loan Portfolio Yield Assessment
75% of the current loans in the portfolio1 are adjustable-rate loans. Of the adjustable-rate loans, 55% have a rate floor with a weighted average2 of 4.86%. The Bank does not hold any leveraged loans in the portfolio. Loan Portfolio Yield Assessment Excludes PPP and Indirect Auto portfolio. Weighted
Slide 12: Profitability
Profitability Non-GAAP measure. 2021 Q2 LTM
Slide 13: Operating Efficiency, Margin Trends, and Capital
Operating Efficiency, Margin Trends, and Capital1 2021 is Q2 annualized. 2021 is Q2 YTD. Noninterest income excluding nonrecurring revenue/total revenue excluding nonrecurring revenue. Non-GAAP measure.
Slide 14: Credit Quality and Loss Provisioning
Credit Quality and Loss Provisioning Excludes PPP Loans
Slide 15: Second Quarter Changes to Allowances
Second Quarter Changes to Allowances A year ago, the Company made a special provision to the Allowance for Loan and Lease Losses (ALLL) after determining the potential impact from the COVID-19 pandemic. The Company updated its assessment as of June 30, 2021 and released $2.1 million of that special
Slide 16: Hospitality Sector is on the Upswing
Start of Pandemic Hospitality Sector is on the Upswing Occupancy is at pre-pandemic levels. The bank currently has 15 customers in the Hospitality sector. The occupancy chart is representative of the Bank’s current hotel customers.
Slide 17: Construction Portfolio Project Distribution
Construction Portfolio Project Distribution Construction Completion Status ($Millions) Construction loan projects are actively managed each month1 Average construction project is $1.8 million 11% of the volume of construction projects are pre-sold 15% of the dollar amount of construction projects ar
Slide 18: Construction Portfolio Type
Construction Portfolio Type Well-diversified across property types and subtypes. Single family residences account for 44% of loan balances and 64% of volume. Construction portfolio contains one tract project that is proceeding well
Slide 19: Construction Portfolio Geography
Construction Portfolio Geography 83% of construction loans are within 15-miles of the District of Columbia.
Slide 20: Capital Ratios and Concentrations
Capital Ratios and Concentrations Company is well-capitalized. Company remains well-capitalized after worst-case loan portfolio stress test. Stress Test includes all active loans Regulatory limit per Formal and Informal Enforcement Action Manual (FDIC), Chapter 5. Construction Concentration is activ
Slide 21: Construction Stress Test Calculations
Construction Stress Test Calculations Each construction loan has an appraisal that identifies the as-is and as-complete value. We assume that the value of an in-process construction project does not increase on a relative basis. A third party updates the percentage of completion for each project mon
Slide 22: Exponential Discounting
Exponential Discounting Construction Discounting A core concept in economics is that of intertemporal choice. Simply put, when presented with the choice of having something today, or having the same thing in the future, people place a greater value on present consumption. Just as with individuals, b
Slide 23: CRE Stress Test Calculations
CRE Stress Test Calculations The model stress tests each CRE loan by 1) interest rate, 2) vacancy rate, and 3) capitalization rate. A failure of one or more tests causes the loan to be included in the failed loan analysis. The first method produces a stressed collateral amount for failed loans and c
Slide 24: Probability of Default Estimates
Probability of Default Estimates Due to the bank’s excellent credit quality over the years, there is only a small sample of charged-off loans from which to perform bank specific statistical modeling of probabilities of default that reach a reasonable level of confidence. To-date the statistical mode
Slide 25: Stress Test for All Other Loans & Summary
Stress Test for All Other Loans & Summary The remainder of the loan portfolio is stressed by call report code using the worst-quarter ever approach. The current balance of loans for each specific call report code is multiplied by the worst-quarter ever percentage loss experienced by the Company for
Slide 26: Tangible Book Value Per Common Share
Tangible Book Value Per Common Share TBVPCS1 21Q2: $20.18 Stock Price2: $22.58 Trading at 112% of TBVPCS TBVPCS is Tangible Book Value per Common Share As-Of June 30, 2021 19% YoY Growth through 2021Q2 Tangible Book Value per Share
Slide 27: Share Buyback
Share Buyback Period Avg. Purchase Price: $15.29 Weekly share price has had steady rise since beginning of November (during which the buyback occurred). 71% growth in share price since end of September. ~835K Shares purchased between Oct. 26 and Nov. 23. Stock Price Since Share Buyback
Slide 28: Stock Price & Index Comparison
Stock Price & Index Comparison Percent change from January 1, 2021. MNSB is up 43% since Jan 1, 2021. Russell 2000 is up 13% since Jan 1, 2021. MNSB was removed from the Russell 2000 on June 25, 2021. Previous closing price data from Yahoo Finance. Data through 7.31.21.
Slide 29: Summary of Financial Information
Summary of Financial Information
Slide 30: Summary of Financial Information Cont.
Summary of Financial Information Cont.
Slide 31: MainStreet Bancshares, Inc. Financial Highlights for 2nd Quarter 2021
MainStreet Bancshares, Inc. Financial Highlights for 2nd Quarter 2021
MainStreet Bancshares — Q2 2021 Earnings Presentation on 6ix