MainStreet Bank Reports Excellent Balance Sheet Growth

Fairfax, VA – MainStreet Bank (OTCQB: MNSB) reported balance sheet growth of 49% through the nine months ending September 30, 2015 with total assets of $481 million against total assets of $322 million at the same period in 2014. The Bank completed an $80 million indirect consumer loan portfolio purchase on July 27, 2015.

Net income is down slightly for the third quarter of 2015 due to the anticipated loan loss provision necessary to book the indirect consumer loan portfolio purchase. The Bank reported net income for the quarter of $353 thousand against the prior quarter net income of $406 thousand, a 13% decline. The loan loss provision for the third quarter totaled $775 thousand.

Year-to-date net income through September 30, 2015 of $1.224 million is up five percent from the same period last year. Fully diluted earnings per share through September 30th were 29 cents as compared with 43 cents for the same period in 2014. However, the weighted average shares outstanding increased by 1,531,372 between the two periods, largely due to a capital raise that occurred at the end of 2014.

Net interest income increased by $2.39 million during the nine months ending September 30, 2015 compared to the same period in 2014. Net interest income totaled $11.26 million during the period, representing a net interest margin of 4.03%.

Loans outstanding increased by $120.23 million during the nine months ending September 30, 2015, from $269.1 million on Dec. 31, 2014 to $389.2 million on September 30, 2015.

Total deposits increased by $86.1 million during the nine months ending September 30, 2015 reaching $388.4 million. Total deposits increased by $100 million, or 34.68%, since the same period in 2014. Year-over-year demand account balances increased by $23.6 million while money market and interest checking accounts increased by $20.5 million, increases of 48.1% and 27.3% respectively. Time deposits increased by $55.9 million, or 34%, during the same period. The increased deposit growth was used to fund liquidity and the indirect consumer loan portfolio purchase. An additional source of funding for the portfolio was Federal Home Loan Bank advances, which increased $44.3 million year over year.

Asset quality remains very strong. Nonperforming loans were 0.21 percent of total loans on September 30, 2015. As a comparison, the average for the 1,239 banks in MainStreet’s national peer group is 0.98% as of June 30, 2015.

For the nine months ending September 30, 2015, non-interest income was $1 million, compared to $831 thousand for the same period in 2014. Non-interest expense for the nine months ending September 30, 2015 was $9.08 million, compared to $7.54 million for the same period in 2014. The increase was driven primarily by personnel related expenses associated with the growth and expansion during 2014, which allowed the company to experience high quality growth.

QUOTES: “The purchase of the $80 million indirect consumer loan portfolio in late July has been a great opportunity for MainStreet, essentially kick-starting the portfolio for the team we acquired late in 2014. That acquisition, in addition to the good growth we continue to experience in the commercial loan portfolio, is the primary reason for our continued high quality performance,” says Jeff W. Dick, Chairman, CEO and President of MainStreet Bank. “As of the nine months ending September 30, 2015, we were trading at approximately 118.5% of book value, and our plan for continued growth should result in building strong shareholder value.”

ABOUT MAINSTREET BANK: MainStreet operates five branches in Herndon, Fairfax, Fairfax City, McLean and Clarendon. In addition, MainStreet has 55,000 free ATMs and an online banking solution called “Airbanking®”. 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 literally “put our bank” in well over 600 businesses in the Metropolitan area.

MainStreet Bank is always looking for ways to improve its customer experience, and now has the ability to instantly issue new and replacement Debit Cards – which is especially important for customers if their Cards are compromised or lost.
MainStreet Bank also continues to refine and improve its mobile banking App, which works on iPads, iPhones and Androids. Additionally, MainStreet Bank released Aircharity® in 2012. Aircharity® is a unique solution that empowers people and organizations to raise money via email, websites and social media. The product allows a customer to open an account and accept donations from debit cards, credit cards and electronic checks.

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.

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This release contains forward-looking statements, including our expectations with respect to future events that are subject to various risks and uncertainties. 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, maintenance and development of well-established and valued client relationships and referral source relationships, and acquisition or loss of key production personnel. Other risks that can affect the Bank are detailed from time to time in our annual reports. 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.


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