8-K
John Marshall Bancorp, Inc. (JMSB)
8-K
2024-06-21
For: 2024-06-18
View Original
Added on
April 06, 2026
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): June 18, 2024
John Marshall Bancorp, Inc.
(Exact name of registrant as specified in its charter)
| - | ||
|---|---|---|
| Virginia | 001-41315 | 81-5424879 |
| (State or other jurisdiction<br><br>of incorporation) | (Commission<br><br>File Number) | (IRS Employer<br><br>Identification No.) |
1943 Isaac Newton Square , Suite 100
Reston , Virginia **** 20190
(Address, including zip code, of principal executive offices)
Registrant’s telephone number, including area code: ( 703 ) 584-0840
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 Instruction 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 registered | Trading symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, par value $0.01 per share | JMSB | 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 5.07 Submission of Matters to a Vote of Security Holders.
John Marshall Bancorp, Inc. (the “Company”) held its Annual Meeting of Shareholders on June 18, 2024 (the “Annual Meeting”). At the Annual Meeting, the shareholders of the Company voted on the proposals below, each of which was described in the Company’s proxy statement for the Annual Meeting. The voting results for each proposal are as follows:
Proposal 1 – Election of Directors
The shareholders elected the nine nominees named in the Company’s proxy statement for the Annual Meeting, to serve until the 2025 Annual Meeting of Shareholders and until their successors are elected and qualified. There were no nominees other than those listed below. The voting results were as follows:
| | | | | | |
|---|---|---|---|---|---|
| | For | | Withhold | | Broker Non-Vote |
| Philip W. Allin | 6,009,591 | | 1,706,760 | | 2,283,699 |
| Christopher W. Bergstrom | 6,976,050 | | 740,301 | | 2,283,699 |
| Philip R. Chase | 6,691,827 | | 1,024,524 | | 2,283,699 |
| Michael T. Foster | 7,340,336 | | 376,015 | | 2,283,699 |
| Michael A. Garcia | 7,309,143 | | 407,205 | | 2,283,702 |
| Subhash K. Garg | 7,658,751 | | 57,600 | | 2,283,699 |
| Jonathan C. Kinney | 7,569,464 | | 146,887 | | 2,283,699 |
| O. Leland Mahan | 7,664,324 | | 52,027 | | 2,283,699 |
| Lim P. Nguonly | 6,704,458 | | 1,011,893 | | 2,283,699 |
Proposal 2 - Ratification of the Appointment of Independent Registered Public Accounting Firm
The shareholders voted to ratify the appointment of Yount, Hyde & Barbour, P.C. as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2024. The voting results were as follows:
| | | | | | | |
|---|---|---|---|---|---|---|
| For | | Against | | Abstain | | Broker Non-Vote |
| 9,955,559 | | 31,938 | | 12,553 | | - |
Item 9.01 Financial Statements and Exhibits.
| (d) | Exhibits |
|---|
| Exhibit No. | Description | |
|---|---|---|
| 99.1 | | 2024 Annual Shareholders’ Meeting Presentation Materials |
| 104 | | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
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.
| JOHN MARSHALL BANCORP, INC. | ||
|---|---|---|
| Date: June 21, 2024 | By: | /s/ Kent D. Carstater |
| Kent D. Carstater<br><br>Senior Executive Vice President, Chief Financial Officer |
Exhibit 99.1
| June 18, 2024<br>Annual Shareholders’<br>Meeting<br>1 |
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| Forward Looking Statements<br>2<br>In addition to historical information, this presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of<br>1995 that are based on certain assumptions and describe future plans, strategies and expectations of John Marshall Bancorp, Inc. (the “Company”). These<br>forward-looking statements are generally identified by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” “will,” “should,”<br>“may,” “view,” “opportunity,” “potential,” or similar expressions. Our ability to predict results or the actual effect of future plans or strategies is inherently<br>uncertain. These forward-looking statements are based on our beliefs and assumptions and on the information available to us at the time that these disclosures<br>were prepared, and involve known and unknown risks, uncertainties and other factors that may cause our actual results to differ materially from any future<br>results expressed or implied by such forward-looking statements. Although we believe the expectations reflected in such forward-looking statements are<br>reasonable, we can give no assurance such expectations will prove to have been correct. Should any known or unknown risks and uncertainties develop into<br>actual events, those developments could have material adverse effects on our business, financial condition and results of operations. Factors that could have<br>a material adverse effect on the operations of the Company and John Marshall Bank include, but are not limited to, the following: the concentration of our<br>business in the Washington, D.C. metropolitan area and the effect of changes in the economic, political and environmental conditions on this market;<br>adequacy of our allowance for loan credit losses, allowance for unfunded commitments credit losses, and allowance for credit losses associated with our held-to-maturity and available-for-sale securities portfolios; deterioration of our asset quality; future performance of our loan portfolio with respect to recently<br>originated loans; the level of prepayments on loans and mortgage-backed securities; liquidity, interest rate and operational risks associated with our business;<br>changes in our financial condition or results of operations that reduce capital; our ability to maintain existing deposit relationships or attract new deposit<br>relationships; changes in consumer spending, borrowing and savings habits; inflation and changes in interest rates that may reduce our margins or reduce the<br>fair value of financial instruments; changes in the monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal<br>Reserve; additional risks related to new lines of business, products, product enhancements or services; increased competition with other financial institutions<br>and fintech companies; adverse changes in the securities markets; changes in the financial condition or future prospects of issuers of securities that we own;<br>our ability to maintain an effective risk management framework; changes in laws or government regulations or policies affecting financial institutions, including<br>changes in regulatory structure and in regulatory fees and capital requirements; compliance with legislative or regulatory requirements; results of examination<br>of us by our regulators, including the possibility that our regulators may require us to increase our allowance for credit losses or to write-down assets or take<br>similar actions; potential claims, damages, and fines related to litigation or government actions; the effectiveness of our internal controls over financial<br>reporting and our ability to remediate any future material weakness in our internal controls over financial reporting; geopolitical conditions, including acts or<br>threats of terrorism and/or military conflicts, or actions taken by the U.S. or other governments in response to acts or threats of terrorism and/or military conflicts,<br>negatively impacting business and economic conditions in the U.S. and abroad; the effects of weather-related or natural disasters, which may negatively<br>affect our operations and/or our loan portfolio and increase our cost of conducting business; public health events (such as the COVID-19 pandemic) an<br>d<br>governmental and societal responses thereto; technological risks and developments, and cyber threats, attacks, or events; the additional requirements of<br>being a public company; changes in accounting policies and practices; our ability to successfully capitalize on growth opportunities; our ability to retain key<br>employees; deteriorating economic conditions, either nationally or in our market area, including higher unemployment and lower real estate values;<br>implications of our status as a smaller reporting company and as an emerging growth company; and other factors discussed in Item 1A. Risk Factors in the<br>Company’s 2023 Annual Report on Form 10-K filed with the SEC on March 20, 2024. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. We do not undertake, and specifically disclaim any obligation, to publicly<br>release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements<br>or to reflect the occurrence of anticipated or unanticipated events. All written or oral forward-looking statements attributable to us are expressly qualified in<br>their entirety by this cautionary note.<br>Use of Non-GAAP Financial Measures<br>This presentation contains certain financial information determined by methods other than in accordance with generally accepted accounting principles in<br>the United States (“GAAP”). These non-GAAP financial measures are a supplement to GAAP, which is used to prepare the Company’s financial statements,<br>and should not be considered in isolation or as a substitute for comparable measures calculated in accordance with GAAP. In addition, the Company’s non-GAAP financial measures may not be comparable to non-GAAP financial measures of other companies. The Company uses the non-GAAP financial measures<br>discussed herein in its analysis of the Company’s performance. Management believes this information is utilized by regulators and market analysts to evaluate a<br>company’s financial condition and therefore, such information is useful to investors. |
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| Agenda<br>3<br>Company Overview<br>2023 Economic Conditions<br>Year in Review<br>First Quarter Highlights and Outlook |
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| 4<br>Company<br>Overview |
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| 5<br>Franchise Overview<br>•Founded 2006<br>•$2.2 billion in assets<br>•Eight regional<br>banking centers serve<br>as business<br>development hubs.<br>•Approximately 97% of<br>the Bank’s deposit<br>dollars are collected<br>electronically.<br>•Relocating Loudoun<br>County office in 4Q<br>2024.<br>District of Columbia:<br>1625 K Street, NW |
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| Strategic Priorities<br>6<br>Provide an<br>Exceptional<br>Client<br>Experience<br>Expand In<br>High Growth<br>Markets<br>Maintain<br>Financial and<br>Credit Discipline |
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| Operating Philosophy<br>7<br> Hire experienced commercial banking and business<br>development officers<br> Enhance customer experience by leveraging digital platform<br> Commercially-oriented bank with focus on deposit-rich industry<br>segments<br> Diversify loan portfolio and improve funding mix<br> Grow non-interest income<br> Continue to leverage existing infrastructure, uphold rigorous<br>expense control and drive profitability<br> Maintain financial and credit quality discipline |
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| 8<br>Selective FinTech partnerships provide<br>operating leverage and fuel additional growth<br>Customer<br>Experience<br>Operating<br>Efficiencies<br>Risk<br>Mitigation<br>FinTech Partnership Benefits<br>Various FinTech Partnerships<br>Leveraging Technology |
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| 9<br>Recognizing the ever evolving need to mitigate risk<br>associated with cyber attacks and fraud activities for our<br>customers, the Bank has the following fraud prevention<br>products and service offerings:<br> Customer & Employee Education<br> Online Account Access<br> Account Monitoring & Controls<br> Positive Pay<br> Cyber Insurance<br>Cyber Security and Fraud Risk |
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| Core Values<br>10 |
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| Diversity, Equity, Opportunity & Inclusion<br>11<br> Our Company’s Board of Directors is<br>comprised of 44% minorities.<br> 40% of executive management<br>team identifies as female.<br> 75% of employees promoted during<br>tenure.<br>Employee<br>Composition: |
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| Our Shareholder Value Proposition<br>Rewarding Our<br>Shareholders<br>Attractive<br>Market<br>Credit<br>Discipline<br>Prime for<br>Future<br>Growth<br>Experienced<br>Management<br>12 |
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| 13<br>2023<br>Economic Conditions |
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| United States Commercial Bank Deposits<br>14<br>$5.00<br>$7.00<br>$9.00<br>$11.00<br>$13.00<br>$15.00<br>$17.00<br>$19.00<br>Jan‐06<br>Jul‐06<br>Jan‐07<br>Jul‐07<br>Jan‐08<br>Jul‐08<br>Jan‐09<br>Jul‐09<br>Jan‐10<br>Jul‐10<br>Jan‐11<br>Jul‐11<br>Jan‐12<br>Jul‐12<br>Jan‐13<br>Jul‐13<br>Jan‐14<br>Jul‐14<br>Jan‐15<br>Jul‐15<br>Jan‐16<br>Jul‐16<br>Jan‐17<br>Jul‐17<br>Jan‐18<br>Jul‐18<br>Jan‐19<br>Jul‐19<br>Jan‐20<br>Jul‐20<br>Jan‐21<br>Jul‐21<br>Jan‐22<br>Jul‐22<br>Jan‐23<br>Jul‐23<br>Jan‐24<br>Deposits ($ Trillions)<br>$5 trillion<br>government stimulus<br>to counteract<br>COVID<br>Source: FRED St. Louis Federal Reserve; Deposit data as of May 29, 2024 |
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| $5 Trillion COVID Stimulus Spurs Inflation<br>15<br>Source: Bureau of Labor Statistics. Amounts reflect 12-month percentage change, Consumer Price Index,<br>all items, not seasonally adjusted.<br>-5.00%<br>0.00%<br>5.00%<br>10.00%<br>Jan-06<br>Nov-06<br>Sep-07<br>Jul-08<br>May-09<br>Mar-10<br>Jan-11<br>Nov-11<br>Sep-12<br>Jul-13<br>May-14<br>Mar-15<br>Jan-16<br>Nov-16<br>Sep-17<br>Jul-18<br>May-19<br>Mar-20<br>Jan-21<br>Nov-21<br>Sep-22<br>Jul-23<br>12-month percentage change, CPI |
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| Federal Reserve Increases Interest Rates to Slow Inflation<br>16<br>In 1.5 years, the Federal Reserve pushed up rates by 5.25% |
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| Federal Reserve Boosting of Rates Inverts Yield Curve<br>17<br>Source: Federal Reserve. Graph above reflects initial point in time when the yield on the 10-year<br>U.S. Treasury was less than 2-year U.S. Treasury.<br>0.00%<br>1.00%<br>2.00%<br>3.00%<br>4.00%<br>5.00%<br>6.00%<br>1 Mo 3 Mo 6 Mo 1 Yr 2 Yr 3 Yr 5 Yr 7 Yr 10 Yr 20 Yr 30 Yr<br>U.S. Treasury Yield Curve<br>Apr-22 Apr-23 |
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| Community Bank Earnings Compression<br>18<br>Return on Average Assets (ROAA)<br>Source: FDIC Quarterly Banking Profile<br>(1) JMSB Core (Non-GAAP) data for 2023 excludes the impact of the Restructuring as discussed in the<br>Company's 10-K filed on March 20, 2024. See Reconciliation of Non-GAAP Disclosures for more details.<br>(2) Peer data reflects FDIC-insured Community Banks.<br>(1)<br>(2) |
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| Inverted Yield Curve Contributes To Bank Failures<br>19<br>Bank Name Date Closed Asset Size<br>First Republic Bank, San Francisco, CA 5/1/2023 $229<br>B<br>Signature Bank, New York, NY 3/12/2023 $110<br>B<br>Silicon Valley Bank, Santa Clara, CA 3/10/2023 $209<br>B<br>Source: FDIC<br>$374<br>$171<br>$549<br> $-<br> $100<br> $200<br> $300<br> $400<br> $500<br> $600<br>Assets of Failed FDIC Insured Banks ($B) |
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| Rate Increases and Regional Bank Failures<br>20<br>• Large cap banks - perceived as “Too big to Fail”- showed price appreciation<br>• Small cap banks were flat to down<br>• JMSB share price retained premium valuation<br>200%<br>144%<br>126% 131%<br>0%<br>50%<br>100%<br>150%<br>200%<br>250%<br>12/31/22 12/31/23<br>Price to Book Value<br>JMSB<br>Small Cap Banks<br>Source: S&P Capital IQ. Small cap banks represent S&P United States SmallCap Banks (Industry Group)<br>Index as of June 11, 2024. |
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| JMSB Has Outperformed Over Time<br>21<br>(1) Information sourced from Yahoo! Finance and indexcalculator.com with share price data as of<br>December 31, 2023<br>9.7%<br>11.3%<br>9.5%<br>8.6%<br>9.2%<br>7.7%<br>4.0%<br>5.0%<br>6.0%<br>7.0%<br>8.0%<br>9.0%<br>10.0%<br>11.0%<br>12.0%<br>June 2008 June 2011 November 2013<br>Annual Return<br>JMSB Equity Offerings<br>JMSB vs. Russell 2000 as of December 31, 2023<br>JMSB Russell 2000 |
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| 22<br>Year in Review |
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| 2023 ― Year in Review<br>23<br>Pristine Asset Quality<br>Strong Capital Position<br>Liquid Balance Sheet<br>Competitive Shareholder Returns<br>Growth and Financial Performance |
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| Pristine Asset Quality<br>24<br>Nonperforming Assets¹ / Assets (%)<br>(1) Nonperforming assets include nonaccrual loans and leases, and<br>foreclosed or repossessed assets.<br>0.32%<br>0.01% 0.09% 0.03% 0.00% 0.00% 0.00% 0.00% 0.00%<br>0.00%<br>0.50%<br>1.00%<br>2015 2016 2017 2018 2019 2020 2021 2022 2023<br> December 31, 2023 represented the 17th consecutive quarter<br>with no loans more than 30 days past due, non-accruing loans,<br>or OREO and 9th consecutive quarter with no net charge-offs.<br> FDIC peer NPA level of 0.9% would equate to approximately $20<br>million if John Marshall Bank were at a comparable level. |
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| Strong Capital Position<br>25<br>3.0<br>5.0<br>7.0<br>9.0<br>11.0<br>13.0<br>15.0<br>17.0<br>Leverage ratio Common equity<br>tier 1 ratio<br>Tier 1 risk-based<br>capital<br>Total risk-based<br>capital ratio<br>Ratios (%)<br>Bank Regulatory Capital Ratios<br>Well-Capitalized Threshold December 31, 2023 March 31, 2024 |
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| Liquid Balance Sheet<br>26<br>Amounts noted above are as of March 31, 2024<br>Liquidity as Percentage of Total Assets |
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| Competitive Shareholder Returns<br>27<br>Dividend<br>Book<br>‐value<br>appreciation<br>1.5%<br>9.2%<br>increase<br>7.7%<br> Increased annual<br>cash dividend 10%<br>to $0.22 per share.<br>Measurement period noted above reflects the year-ended December 31, 2023. |
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| Balance Sheet Growth<br>28<br>Dollars in thousands<br>Total Assets<br>$1,175<br>$1,394<br>$1,582<br>$1,885<br>$2,149<br>$2,348 $2,243<br>2017 2018 2019 2020 2021 2022 2023<br>Gross Loans<br>$1,007<br>$1,161<br>$1,326<br>$1,563 $1,666 $1,789 $1,860<br>2017 2018 2019 2020 2021 2022 2023<br>Deposits<br>$897<br>$1,138<br>$1,309<br>$1,640<br>$1,882<br>$2,068<br>$1,907<br>2017 2018 2019 2020 2021 2022 2023 |
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| 2023 Financial Performance<br>29<br>0.80%<br>0.95%<br>1.08% 1.06%<br>1.25%<br>1.40%<br>0.22%<br>0.85%<br>2017 2018 2019 2020 2021 2022 2023<br>ROAA<br>Core ROAA (Non‐GAAP)<br>Return on Average Assets (ROAA)<br>7.14%<br>8.98%<br>10.41% 10.49%<br>12.90%<br>15.18%<br>2.32%<br>8.91%<br>2017 2018 2019 2020 2021 2022 2023<br>ROAE<br>Core ROAE (Non‐GAAP)<br>Return on Average Equity (ROAE)<br>$0.66<br>$0.89<br>$1.17<br>$1.35<br>$1.83<br>$2.25<br>$0.36<br>$1.39<br>2017 2018 2019 2020 2021 2022 2023<br>Diluted EPS<br>Core Diluted EPS (Non‐GAAP)<br>Diluted Earnings Per Share (EPS)<br>(1) - Core metrics (Non-GAAP) reflect metrics adjusted for the impact of the Restructuring as discussed in<br>the Company's 10-K filed on March 20, 2024. See Reconciliation of Non-GAAP Disclosures for more details.<br>(1) (1)<br>(1) |
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| 30<br>First Quarter 2024<br>Highlights & Outlook |
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| First Quarter 2024 Highlights<br>31<br>0.0%<br>0.9%<br>JMSB FDIC - All<br>Banks<br>16.1%<br>15.4%<br>JMSB FDIC - All<br>Banks<br>1.4%<br>2.5%<br>JMSB FDIC - All<br>Banks<br>FDIC – All Banks data is sourced from the FDIC’s Quarterly Banking Profile as of<br>March 31, 2024.<br>Asset Quality<br>Nonperforming Assets / Assets<br>Bank Capital<br>Total Risk Based Capital Ratio<br>Expense Management<br>Non-interest expense<br>to Average Assets |
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| Outlook<br>32<br>U.S. economy experiencing an unprecedented interest rate environment<br>Placing greater emphasis on financial condition than growth<br>Loan pipeline, prudently underwritten, indicates promising growth in coming quarters<br>Grow deposits and improve funding composition<br>Ramp up hiring of seasoned, well-qualified sales personnel<br>Continue to execute non-interest income strategy<br>Capitalize on appropriate growth opportunities |
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| Appendix<br>33 |
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| Reconciliation of Non-GAAP Disclosures<br>34<br>John Marshall Bancorp, Inc.<br>Reconciliation of Certain Non-GAAP Financial Measures (unaudited)<br>(Dollar amounts in thousands, except per share amounts)<br>For the Twelve<br>Months Ended<br>December 31, 2023<br>Non-interest loss (GAAP) $ (14,940)<br>Adjustment: Pre-tax loss recognized on sale of available-for-sale securities 17,114<br>Core non-interest income (Non-GAAP) $ 2,174<br>Income before taxes (GAAP) $ 7,981<br>Adjustment: Pre-tax loss recognized on sale of available-for-sale securities 17,114<br>Core income before taxes (Non-GAAP) $ 25,095<br>Income tax expense (GAAP) $ 2,823<br>Adjustment: Tax and 10% modified endowment contract penalty on early surrender of BOLI policies (1,101)<br>Adjustment: Tax benefit of loss recognized on sale of available-for-sale securities 3,594<br>Core income tax expense (Non-GAAP)(1) $ 5,316<br>Net income (GAAP) $ 5,158<br>Core net income (Non-GAAP)(2) $ 19,779<br>Earnings per share - basic (GAAP) $ 0.37<br>Core earnings per share - basic (Non-GAAP)(3) $ 1.40<br>Earnings per share - diluted (GAAP) $ 0.36<br>Core earnings per share - diluted (Non-GAAP)(3) $ 1.39<br>Return on average assets (GAAP) 0.22<br>%<br>Core return on average assets (Non-GAAP)(4) 0.85<br>%<br>Return on average equity (GAAP) 2.32<br>%<br>Core return on average equity (Non-GAAP)(5) 8.91<br>%<br>(1) Includes tax benefit (expense) calculated using the federal statutory tax rate of 21%.<br>(2) Core net income reflects net income adjusted for the non-recurring tax effected loss recognized on the sale of available-for-sale securities i<br>n<br>and non-recurring tax expense associated with the surrender of the Company’s BOLI policies in July 2023. It is calculated by subtracting core<br>income tax expense from core income before taxes for the periods presented.<br>(3) Core earnings per share – basic and core earnings per share – diluted is calculated by dividing core net income by basic weighted average<br>shares outstanding and diluted weighted average shares outstanding, respectively, for the period presented.<br>(4) Core return on average assets is calculated by dividing core net income by average assets for the period presented.<br>(5) Core return on average equity is calculated by dividing core net income by average equity for the period presented. |
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