MainStreet Bancshares, Inc 8-K/A, filed Apr 23, 2024

MainStreet Bancshares, Inc. (MNSB)

8-K/A 2024-04-23 For: 2024-04-23

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Added on April 09, 2026

About this 8-K/A

MainStreet Bancshares, Inc filed this 8-K/A on April 23, 2024.

Items reported

Item 2.02: Financial results
Item 7.01: Regulation FD disclosure
Item 9.01: Financial statements and exhibits

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Virginia	001-38817	81-2871064
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

10089 Fairfax Boulevard, Fairfax, VA		22030
(Address of Principal Executive Offices)		(Zip Code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	MNSB	The Nasdaq Stock Market LLC
Depositary Shares (each representing a 1/40^th interest in a share of 7.50% Series A Fixed-Rate Non-Cumulative Perpetual Preferred Stock	MNSBP	The Nasdaq Stock Market LLC

Exhibit Number		Description
99.1		Press Release, dated April 22, 2024, with respect to the Company’s unaudited financial results for the first quarter ended March 31, 2024.
99.2		Corrected Investor Presentation dated April 23, 2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

	MAINSTREET BANCSHARES, INC

Date: April 23, 2024	By:	/s/ Thomas J. Chmelik
		Name: Thomas J. Chmelik
		Title: Chief Financial Officer

PRESS RELEASE		Contact: Debra Cope
April 22, 2024 8:00 AM ET		Director of Corporate Communications
		Desk (703) 481-4599
		Mobile (202) 468-3184

	March 31, 2024			December 31, 2023*			September 30, 2023			June 30, 2023			March 31, 2023
ASSETS
Cash and cash equivalents
Cash and due from banks	$	49,208		$	53,581		$	44,912		$	67,700		$	225,334
Federal funds sold		75,533			60,932			76,271			30,341			—
Total cash and cash equivalents		124,741			114,513			121,183			98,041			225,334
Investment securities available for sale, at fair value		58,699			59,928			56,726			60,579			63,209
Investment securities held to maturity, at amortized cost, net of allowance for credit losses of $0 for all periods		17,251			17,275			17,565			17,590			17,616
Restricted equity securities, at amortized cost		23,924			24,356			20,619			20,304			22,436
Loans, net of allowance for credit losses of $16,531, $16,506, $15,626, $16,047, and $15,435, respectively		1,727,110			1,705,137			1,681,444			1,637,484			1,617,275
Premises and equipment, net		14,081			13,944			14,275			14,427			14,521
Accrued interest and other receivables		10,727			12,390			11,184			10,256			9,744
Computer software, net of amortization		15,691			14,657			13,373			12,266			10,559
Bank owned life insurance		38,609			38,318			38,035			37,763			37,503
Other assets		39,182			34,914			47,087			40,641			36,811
Total Assets	$	2,070,015		$	2,035,432		$	2,021,491		$	1,949,351		$	2,055,008
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Non-interest bearing deposits	$	348,945		$	364,606		$	394,859		$	388,992		$	487,875
Interest bearing demand deposits		165,331			137,128			76,423			71,308			100,522
Savings and NOW deposits		46,036			45,878			46,550			51,294			53,499
Money market deposits		446,903			442,179			461,398			380,500			260,316
Time deposits		725,520			696,336			703,960			701,289			730,076
Total deposits		1,732,735			1,686,127			1,683,190			1,593,383			1,632,288
Federal funds purchased		—			15,000			—			30,000			60,696
Federal Home Loan Bank advances		—			—			—			—			45,000
Subordinated debt		72,741			72,642			72,543			72,444			72,344
Other liabilities		41,418			40,146			52,015			43,016			39,692
Total Liabilities		1,846,894			1,813,915			1,807,748			1,738,843			1,850,020
Stockholders’ Equity:
Preferred stock		27,263			27,263			27,263			27,263			27,263
Common stock		29,514			29,198			29,188			29,177			29,185
Capital surplus		65,940			65,985			65,407			64,768			64,213
Retained earnings		108,334			106,549			102,694			97,646			91,991
Accumulated other comprehensive loss		(7,930	)		(7,478	)		(10,809	)		(8,346	)		(7,664	)
Total Stockholders’ Equity		223,121			221,517			213,743			210,508			204,988
Total Liabilities and Stockholders’ Equity	$	2,070,015		$	2,035,432		$	2,021,491		$	1,949,351		$	2,055,008

	Three Months Ended
	March 31, 2024			December 31, 2023		September 30, 2023		June 30, 2023		March 31, 2023
INTEREST INCOME:
Interest and fees on loans	$	30,487		$	30,849	$	29,750	$	28,855	$	26,731
Interest on investment securities
Taxable securities		435			451		459		407		518
Tax-exempt securities		270			268		268		265		264
Interest on federal funds sold		1,182			1,510		1,217		1,179		1,132
Total interest income		32,374			33,078		31,694		30,706		28,645
INTEREST EXPENSE:
Interest on interest bearing demand deposits		1,860			1,058		240		251		343
Interest on savings and NOW deposits		157			146		145		147		108
Interest on money market deposits		5,178			5,639		4,156		2,926		1,203
Interest on time deposits		8,833			8,257		7,526		7,077		4,144
Interest on federal funds purchased		107			25		35		201		38
Interest on Federal Home Loan Bank advances		46			118		186		13		906
Interest on subordinated debt		820			828		828		820		812
Total interest expense		17,001			16,071		13,116		11,435		7,554
Net interest income		15,373			17,007		18,578		19,271		21,091
(Recovery of) provision for credit losses		(195	)		466		255		638		283
Net interest income after (recovery of) provision for credit losses		15,568			16,541		18,323		18,633		20,808
NON-INTEREST INCOME:
Deposit account service charges		469			510		514		535		590
Bank owned life insurance income		292			283		272		259		255
Other non-interest income		130			68		177		16		158
Total other income		891			861		963		810		1,003
NON-INTEREST EXPENSES:
Salaries and employee benefits		7,488			7,129		6,924		6,595		7,621
Furniture and equipment expenses		935			804		713		772		498
Advertising and marketing		454			271		577		698		797
Occupancy expenses		435			397		375		426		486
Outside services		774			352		697		504		490
Administrative expenses		242			219		277		211		215
Other operating expenses		1,996			1,964		1,866		1,646		1,596
Total non-interest expenses		12,324			11,136		11,429		10,852		11,703
Income before income tax expense		4,135			6,266		7,857		8,591		10,108
Income tax expense		830			1,120		1,516		1,645		1,957
Net income		3,305			5,146		6,341		6,946		8,151
Preferred stock dividends		539			539		539		539		539
Net income available to common shareholders	$	2,766		$	4,607	$	5,802	$	6,407	$	7,612
Net income per common share, basic and diluted	$	0.36		$	0.61	$	0.77	$	0.85	$	1.01
Weighted average number of common shares, basic and diluted		7,611,990			7,527,327		7,524,332		7,522,764		7,517,213

(1)	Includes ICS, CDARS, and reciprocal deposits maintained by customers, which represent sweep accounts tied to customer operating accounts
(2)	Consists of certificates of deposit (CD) through multiple listing services and multiple brokered deposit services, as well as ICS and CDARS one-way certificates of deposit and regional money market accounts.
	Excludes $210.9 million in core deposits placed in reciprocal networks for FDIC insurance coverage that will be classified as brokered deposits on the call report in pursuant to rule 12 CFR 337.6(e) as of March 31, 2024.
(3)	Subordinated debt obligation qualifies as Tier 2 capital at the holding company and Tier 1 capital at the Bank

	For the three months ended March 31, 2024							For the three months ended March 31, 2023
	Average Balance		Interest Income/ Expense (3)(4)		Average Yields/ Rate (annualized) (3)(4)			Average Balance		Interest Income/ Expense (3)(4)		Average Yields/ Rate (annualized) (3)(4)
ASSETS:
Interest-earning assets:
Loans (1)(2)	$	1,728,761	$	30,487		7.07	%	$	1,599,756	$	26,731		6.78	%
Securities:
Taxable		56,001		435		3.12	%		57,600		518		3.65	%
Tax-exempt		37,420		342		3.66	%		37,941		334		3.57	%
Federal funds and interest-bearing deposits		91,993		1,182		5.15	%		118,670		1,132		3.87	%
Total interest-earning assets	$	1,914,175	$	32,446		6.80	%	$	1,813,967	$	28,715		6.42	%
Other assets		123,294							71,704
Total assets	$	2,037,469						$	1,885,671
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits	$	146,248	$	1,860		5.10	%	$	83,388	$	343		1.67	%
Savings and NOW deposits		44,219		157		1.42	%		51,943		108		0.84	%
Money market deposit accounts		433,654		5,178		4.79	%		225,037		1,203		2.17	%
Time deposits		710,019		8,833		4.99	%		673,441		4,144		2.50	%
Total interest-bearing deposits	$	1,334,140	$	16,028		4.82	%	$	1,033,809	$	5,798		2.27	%
Federal funds borrowed		7,476		107		5.74	%		2,965		38		5.20	%
FHLB advances		3,297		46		5.60	%		77,833		906		4.72	%
Subordinated debt		72,703		820		4.52	%		72,306		812		4.55	%
Total interest-bearing liabilities	$	1,417,616	$	17,001		4.81	%	$	1,186,913	$	7,554		2.58	%
Demand deposits and other liabilities		397,753							497,155
Total liabilities	$	1,815,369						$	1,684,068
Stockholders’ Equity		222,100							201,603
Total Liabilities and Stockholders’ Equity	$	2,037,469						$	1,885,671
Interest Rate Spread						1.99	%						3.84	%
Net Interest Income			$	15,445						$	21,161
Net Interest Margin						3.24	%						4.73	%

(1)	Includes loans classified as non-accrual
(2)	Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs
(3)	Income and yields for all periods presented are reported on a tax-equivalent basis using the federal statutory rate of 21%
(4)	Refer to Appendix for reconciliation of non-GAAP measures

	At or For the Three Months Ended
	March 31,
	2024			2023
*Per share Data and Shares Outstanding*
Earnings per common share (basic and diluted)	$	0.36		$	1.01
Book value per common share	$	25.72		$	23.62
Tangible book value per common share⁽²⁾	$	23.66		$	22.22
Weighted average common shares (basic and diluted)		7,611,990			7,517,213
Common shares outstanding at end of period		7,614,090			7,524,277
*Performance Ratios*
Return on average assets (annualized)		0.65	%		1.75	%
Return on average equity (annualized)		5.97	%		16.40	%
Return on average common equity (annualized)		5.69	%		17.71	%
Yield on earning assets (FTE) ⁽²⁾ (annualized)		6.80	%		6.42	%
Cost of interest bearing liabilities (annualized)		4.81	%		2.58	%
Net interest spread (FTE)⁽²⁾		1.99	%		3.84	%
Net interest margin (FTE)⁽²⁾ (annualized)		3.24	%		4.73	%
Noninterest income as a percentage of average assets (annualized)		0.18	%		0.22	%
Noninterest expense to average assets (annualized)		2.43	%		2.52	%
Efficiency ratio⁽³⁾		75.77	%		52.97	%
*Asset Quality*
Allowance for credit losses (ACL)
Beginning balance, ACL - loans	$	16,506		$	14,114
Add: current expected credit losses, nonrecurring adoption		—			895
Add: recoveries		2			11
Less: charge-offs		(141	)		—
Add: provision for (recovery of) credit losses - loans		164			415
Ending balance, ACL - loans	$	16,531		$	15,435

Beginning balance, reserve for unfunded commitment (RUC)	$	1,009		$	—
Add: current expected credit losses, nonrecurring adoption		—			1,310
Add: provision for (recovery of) unfunded commitments, net		(359	)		(132	)
Ending balance, RUC	$	650		$	1,178
Total allowance for credit losses	$	17,181		$	16,613

Allowance for credit losses on loans to total gross loans		0.95	%		0.94	%
Allowance for credit losses to total gross loans		0.98	%		1.01	%
Allowance for credit losses on loans to non-performing loans		1.78X			N/A
Net charge-offs (recoveries) to average gross loans (annualized)		0.03	%		0.00	%
*Concentration Ratios*
Commercial real estate loans to total capital ⁽⁴⁾		364.65	%		372.12	%
Construction loans to total capital⁽⁵⁾		130.06	%		140.78	%
*Non-performing Assets*
Loans 30-89 days past due to total gross loans		0.22	%		0.00	%
Loans 90 days past due to total gross loans		0.51	%		0.00	%
Non-accrual loans to total gross loans		0.53	%		0.00	%
Other real estate owned	$	—		$	—
Non-performing loans	$	9,263		$	—
Non-performing assets to total assets		0.45	%		0.00	%
*Regulatory Capital Ratios (Bank only) ⁽¹⁾*
Total risk-based capital ratio		17.05	%		16.35	%
Tier 1 risk-based capital ratio		16.12	%		15.49	%
Leverage ratio		14.54	%		14.69	%
Common equity tier 1 ratio		16.12	%		15.49	%
*Other information*
Closing stock price	$	18.16		$	23.49
Tangible equity / tangible assets ⁽²⁾		10.10	%		9.51	%
Average tangible equity / average tangible assets ⁽²⁾		10.24	%		10.22	%
Number of full time equivalent employees		191			170
Number of full service branch offices		6			6

(1)	Regulatory capital ratios as of March 31, 2024 are preliminary
(2)	Refer to Appendix for reconciliation of non-GAAP measures
(3)	Efficiency ratio is calculated as non-interest expense as a percentage of net interest income and non-interest income
(4)	Commercial real estate includes only non-owner occupied and construction loans as a percentage of Bank capital
(5)	Construction loans as a percentage of Bank capital

	For the three months ended March 31,
	2024			2023
Net interest margin (FTE)
Net interest income (GAAP)	$	15,373		$	21,091
FTE adjustment on tax-exempt securities		72			70
Net interest income (FTE) (non-GAAP)		15,445			21,161

Average interest earning assets		1,914,175			1,813,967
Net interest margin (GAAP)		3.22	%		4.72	%
Net interest margin (FTE) (non-GAAP)		3.24	%		4.73	%

	As of March 31,
	2024			2023
Tangible common stockholders' equity
Total stockholders' equity (GAAP)	$	223,121		$	204,988
Less: intangible assets		(15,691	)		(10,559	)
Tangible stockholders' equity (non-GAAP)		207,430			194,429
Less: preferred stock		(27,263	)		(27,263	)
Tangible common stockholders' equity (non-GAAP)		180,167			167,166

Common shares outstanding		7,614,090			7,524,277
Tangible book value per common share (non-GAAP)	$	23.66		$	22.22

	March 31, 2024						December 31, 2023						March 31, 2023						Percentage Change
	$ Amount			% of Total			$ Amount			% of Total			$ Amount			% of Total			Last 3 Mos			Last 12 Mos
LOANS:
Construction and land development loans	$	408,903			23.4	%	$	429,637			24.9	%	$	415,078			25.3	%		-4.8	%		-1.5	%
Residential real estate loans		451,991			25.8	%		474,602			27.5	%		391,648			23.9	%		-4.8	%		15.4	%
Commercial real estate loans		813,387			46.5	%		743,827			43.1	%		737,019			45.0	%		9.4	%		10.4	%
Commercial and industrial loans		71,822			4.1	%		75,415			4.4	%		86,937			5.3	%		-4.8	%		-17.4	%
Consumer loans		2,902			0.2	%		3,610			0.1	%		7,534			0.5	%		-19.6	%		-61.5	%
Total Gross Loans	$	1,749,005			100.0	%	$	1,727,091			100.0	%	$	1,638,216			100.0	%		1.3	%		6.8	%
Less: Allowance for credit losses		(16,531	)					(16,506	)					(15,435	)
Net deferred loan fees		(5,364	)					(5,448	)					(5,506	)
Net Loans	$	1,727,110					$	1,705,137					$	1,617,275
DEPOSITS:
Non-interest bearing deposits	$	348,945			20.1	%	$	364,606			21.6	%	$	487,875			29.9	%		-4.3	%		-28.5	%
Interest-bearing deposits:
Demand deposits		165,331			9.5	%		137,128			8.1	%		100,522			6.2	%		20.6	%		64.5	%
Savings and NOW deposits		46,036			2.7	%		45,878			2.7	%		53,499			3.3	%		0.3	%		-13.9	%
Money market accounts		446,903			25.8	%		442,179			26.2	%		260,316			15.9	%		1.1	%		71.7	%
Certificates of deposit $250,000 or more		467,892			27.0	%		442,662			26.3	%		458,683			28.1	%		5.7	%		2.0	%
Certificates of deposit less than $250,000		257,628			14.9	%		253,674			15.1	%		271,393			16.6	%		1.6	%		-5.1	%
Total Deposits	$	1,732,735			100.0	%	$	1,686,127			100.0	%	$	1,632,288			100.0	%		2.8	%		6.2	%
BORROWINGS:
Federal funds purchased		—			0.0	%		15,000			17.1	%		60,696			34.1	%		-100.0	%		-100.0	%
Federal Home Loan Bank advances		—			0.0	%		—			0.0	%		45,000			25.3	%		0.0	%		-100.0	%
Subordinated debt		72,741			100.0	%		72,642			82.9	%		72,344			40.6	%		0.1	%		0.5	%
Total Borrowings	$	72,741			100.0	%	$	87,642			100.0	%	$	178,040			100.0	%		-17.0	%		-59.1	%
Total Deposits and Borrowings	$	1,805,476					$	1,773,769					$	1,810,328						1.8	%		-0.3	%

Core customer funding sources ⁽¹⁾	$	1,312,746			72.7	%	$	1,252,534			70.7	%	$	1,156,279			63.9	%		4.8	%		13.5	%
Brokered and listing service sources ⁽²⁾		419,989			23.3	%		433,593			24.4	%		476,009			26.3	%		-3.1	%		-11.8	%
Federal funds borrowed		—			0.0	%		15,000			0.8	%		60,696			3.3	%		-100.0	%		-100.0	%
Federal Home Loan Bank advances		—			0.0	%		—			0.0	%		45,000			2.5	%		0.0	%		-100.0	%
Subordinated debt ⁽³⁾		72,741			4.0	%		72,642			4.1	%		72,344			4.0	%		0.1	%		0.5	%
Total Funding Sources	$	1,805,476			100.0	%	$	1,773,769			100.0	%	$	1,810,328			100.0	%		1.8	%		-0.3	%