Financial Performance - MainStreet Bancshares reported a loss of $9.98 million for 2024 due to nonrecurring impairment of capitalized intangible software and resolution of nonperforming assets[1]. - The company reported a net loss of $9,980 thousand, contrasting with a net income of $26,585 thousand in the previous year[17]. - Earnings per common share were reported at $(1.60), down from $3.25, indicating a substantial decline[17]. - The company's return on average assets (annualized) for the three months ended December 31, 2024, was (2.80)%, compared to 1.02% for the same period in 2023[27]. - Net income (loss), as reported, for Q4 2024 was $(16,167) million, compared to a profit of $5,146 million in Q4 2023[30]. - Adjusted net income (loss) for Q4 2024 was $(353) million, while adjusted net income for Q4 2023 was $5,146 million[30]. - The annualized return on average assets (ROAA), as reported, for 2024 was (0.47)%, compared to 1.38% in 2023[30]. Revenue and Income - Total interest income for the year-to-date increased to $134,615 thousand, up from $124,421 thousand in the previous year, representing an increase of 0.96%[17]. - Total non-interest income totaled $3,252 thousand, slightly down from $3,340 thousand, reflecting a decrease of 2.63%[17]. - Net interest income after provision for credit losses decreased to $55,811 thousand from $75,100 thousand, a decline of 25.7%[17]. - Net interest income for the year ended December 31, 2024, was $62,865 thousand, a decrease from $77,025 thousand in 2023, reflecting a decline of 18.4%[25]. - Net interest income (GAAP) for Q4 2024 was $16,041 million, down from $17,311 million in Q4 2023, representing a decrease of 7.3%[30]. - Total interest income (GAAP) for the year 2024 was $134,615 million, an increase of 8.5% compared to $124,421 million in 2023[30]. Assets and Liabilities - Total assets as of December 31, 2024, were $2.23 billion, reflecting a stable financial position[15]. - The allowance for credit losses on loans increased to $19,450 thousand as of December 31, 2024, up from $16,506 thousand in 2023, indicating a rise of 11.7%[27]. - Total gross loans increased to $1,834,988 million, reflecting a 2.0% increase from the previous quarter and a 6.2% increase year-over-year[19]. - Net loans amounted to $1,810,556 million, showing a quarter-over-quarter increase of 2.0%[19]. - The total funding sources increased to $1,980,833 million, reflecting a 0.7% increase from the previous quarter and an 11.7% increase year-over-year[19]. Deposits and Funding - Total deposits grew by 13% year-over-year to $1.9 billion, with core deposits increasing by $187 million[2]. - Total deposits reached $1,907,794 million, a slight increase of 0.7% from the previous quarter and a significant 13.1% increase year-over-year[19]. - Non-interest bearing deposits decreased by 6.7% quarter-over-quarter and 11.1% year-over-year, totaling $324,307 million[19]. - Interest-bearing deposits saw a notable increase in money market deposits, which rose by 23.9% quarter-over-quarter and 26.7% year-over-year, reaching $560,082 million[19]. Operational Efficiency - The efficiency ratio for the year ended December 31, 2024, was 110.85%, significantly higher than 56.96% in 2023, indicating increased operational costs relative to income[27]. - The efficiency ratio, as reported, for Q4 2024 was 204.36%, significantly higher than 61.29% in Q4 2023[31]. Capital and Equity - Total stockholders' equity decreased to $207.99 million by year-end 2024, down from $226.05 million in the previous quarter[15]. - The total risk-based capital ratio as of December 31, 2024, was 15.69%, down from 17.18% in 2023, reflecting a decrease in capital adequacy[27]. - Tangible common stockholders' equity as of December 31, 2024, was $180,728 million, slightly up from $179,597 million in 2023[31]. - The tangible equity to tangible assets ratio decreased to 9.33% in 2024 from 10.24% in 2023, indicating a decline in financial stability[28]. Market and Stock Performance - The closing stock price on December 31, 2024, was $18.10, a decline from $24.81 at the end of 2023, representing a drop of 27.1%[27]. Employee Metrics - The number of full-time equivalent employees increased to 204 in 2024, up from 186 in 2023, indicating a growth in workforce[28]. Interest Rates and Economic Environment - The interest rate environment has normalized with the FOMC cutting rates by a total of 1.0% in 2024, benefiting borrowers[3]. - The interest rate spread decreased to 1.99%, down from 2.39% year-over-year[23]. - The yield on earning assets (GAAP) for Q4 2024 was 6.45%, down from 6.83% in Q4 2023[31].

Financial Performance - Net income for the three months ended September 30, 2024, was $265 thousand, a significant decrease of 95.8% from $6,341 thousand in the same period of 2023[9]. - Net income for the nine months ended September 30, 2024, was $6,187,000, a decrease of 71% compared to $21,438,000 in 2023[20]. - Comprehensive income for the three months ended September 30, 2024, was $1,934 thousand, compared to $3,878 thousand for the same period in 2023[11]. - The company reported a basic loss per common share of $0.04 for the three months ended September 30, 2024, compared to earnings of $0.77 per share in the same period of 2023[9]. - Net income available to common shareholders for the three months ended September 30, 2024, was a loss of $274,000 compared to a profit of $5,802,000 for the same period in 2023[112]. Asset and Deposit Growth - Total assets increased to $2,224,599 thousand as of September 30, 2024, up from $2,035,432 thousand at December 31, 2023, representing a growth of approximately 9.3%[6]. - Total deposits increased to $1,893,669 thousand as of September 30, 2024, up from $1,686,127 thousand at December 31, 2023, reflecting a growth of approximately 12.3%[6]. - As of September 30, 2024, total stockholders' equity increased to $226,051 thousand, up from $224,715 thousand as of June 30, 2024, reflecting a growth of approximately 0.6%[15]. - Cash and cash equivalents at the end of the period reached $232,114,000, up from $121,183,000, marking an increase of 92%[20]. Interest Income and Expense - Net interest income for the three months ended September 30, 2024, was $15,343 thousand, a decrease of 18.3% compared to $18,772 thousand for the same period in 2023[9]. - The total interest income for the three months ended September 30, 2024, was $33,591 thousand, an increase of 5.8% from $31,766 thousand in the same period of 2023[9]. - Total interest expense increased by $5.3 million to $18.2 million for the three months ended September 30, 2024, from $13.0 million for the same period in 2023[150]. - The average yield on interest-earning assets decreased by 14 basis points to 6.67% for the three months ended September 30, 2024, compared to 6.81% for the same period in 2023[145]. Credit Losses and Provisions - Provision for credit losses on loans was $3,125 thousand for the three months ended September 30, 2024, compared to a recovery of $98 thousand in the same period of 2023[9]. - The allowance for credit losses on loans was $18.3 million as of September 30, 2024, compared to $16.5 million at the end of 2023, indicating an increase of approximately 10.9%[55]. - The total allowance for credit losses was $18,327,000, an increase from $17,098,000 at the end of the previous quarter[59]. - The company reported charge-offs of $1,907,000 for the three months ended September 30, 2024, compared to $324,000 in the same period last year[59]. Non-Interest Income and Expense - Non-interest income for the Core Banking segment was $667 million, while total non-interest expense was $12,153 million for the same period[120]. - Non-interest income decreased by $5,000, or 0.6%, to $886,000 for Q3 2024, primarily due to non-recurring prepayment penalties recognized in 2023[165]. - Non-interest expense increased by $1.7 million, or 14.4%, to $13.2 million for Q3 2024, driven by increases in salaries and employee benefits as the company added fifteen employees[166]. Loan Performance - Loan originations decreased from approximately $92.0 million in the three months ended September 30, 2023, to $60.0 million in the same period of 2024, a decline of $32.0 million[160]. - Non-performing loans increased to a balance of $28.3 million as of September 30, 2024, with 42% attributable to one relationship[160]. - Special mention loans increased by $29.9 million and substandard loans increased by $44.2 million, totaling $45.8 million and $77.6 million respectively as of September 30, 2024[162]. Strategic Initiatives and Future Outlook - The company is focusing on market expansion and new product development to enhance revenue streams in the upcoming quarters[81]. - Future guidance indicates a positive outlook for revenue growth driven by strategic initiatives and market demand[81]. - The company is actively exploring acquisition opportunities to strengthen its market position and diversify its offerings[81]. Regulatory and Accounting Changes - The company adopted ASU 2023-02, which allows for a new method of accounting for tax equity investments, effective January 1, 2024, with a cumulative change of approximately $217,000[33]. - The Company expects the adoption of ASU 2023-07 to have no material impact on its consolidated financial statements, effective for fiscal years beginning after December 15, 2023[36].

Financial Data and Key Metrics Changes - The company reported an earnings per common share loss of $0.04 in Q3 2024, primarily due to actions taken on problem loans, impacting several financial ratios including net interest margin and efficiency ratio [11][12] - The annualized net interest margin for Q3 was 3.05%, with a year-to-date margin of 3.19%. Without interest reversals, the margins would have been 3.25% for the quarter and 3.32% year-to-date, indicating stability and improvement in the core earning engine [13] - Noninterest expenses decreased slightly quarter-over-quarter, with a projected run rate of 50 basis points per month for Q4 [17] Business Line Data and Key Metrics Changes - Core deposits constituted 78% of total deposits, with $95 million in new core deposits during the quarter, 35% of which were noninterest-bearing [14] - Gross loans remained flat at $1.8 billion, with new loan fundings of $82 million, indicating continued interest income growth [16][38] - The concentration in construction loans decreased from 130% of capital to 118%, attributed to lower origination volumes and project completions [27] Market Data and Key Metrics Changes - The company operates in a strong market characterized by low unemployment and high median household incomes, benefiting from its location in the Washington D.C. Metropolitan area [5] - Traditional deposit growth remains a challenge across many markets, prompting the company to pursue a banking-as-a-service solution to acquire low-cost deposits [8] Company Strategy and Development Direction - The company is focused on expanding its net interest margin by lowering deposit costs and enhancing its digital strategy through the Avenu banking-as-a-service solution [6][46] - Avenu version 1 is now in service, aimed at reaching new customer deposit segments and diversifying revenue streams [9][46] - The company engaged an independent consulting group, FS Vector, to assess the Avenu solution and its fit within the current regulatory environment [51][53] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future performance, expecting improved metrics in loan classifications and a reduction in problem loans [12][43] - The company is well-capitalized and committed to serving its community, with a focus on healthy growth despite challenges in the market [44] Other Important Information - The company has a robust liquidity management plan and is actively monitoring the stickiness of deposits from fintech partners [87] - The projected breakeven point for the Avenu solution has been pushed to 2026, reflecting a more conservative outlook based on the delayed launch and market conditions [76][79] Q&A Session Summary Question: What industries were involved in the loans sold at par? - The loans sold at par were primarily in investor commercial real estate, including a for-sale condo project and a multifamily project [65] Question: Can you provide an update on the cost of funds? - The cost of funds has declined slightly from June to September, and the beta on funding as Fed funds declines is expected to be higher than during the increase [66][68] Question: What are the expectations for Avenu's growth? - The current deposits stand at $30 million, with a breakeven point projected for 2026, reflecting a conservative estimate based on the delayed launch [76][79] Question: Are FDIC costs changing? - FDIC costs are expected to remain consistent, with slight increases due to higher deposits [72] Question: What is the estimated loss from nonperforming loans? - The estimated loss from current nonperforming loans is around 1.25%, equating to approximately $250,000 to $300,000 [89]

MainStreet Bank (MNSB) came out with a quarterly loss of $0.04 per share in line with the Zacks Consensus Estimate. This compares to earnings of $0.77 per share a year ago. These figures are adjusted for non-recurring items. A quarter ago, it was expected that this company would post earnings of $0.32 per share when it actually produced earnings of $0.27, delivering a surprise of -15.63%. Over the last four quarters, the company has not been able to surpass consensus EPS estimates. MainStreet Bank, which be ...

Financial Performance - MainStreet Bancshares reported a loss of -$0.04 per common share for Q3 2024, with year-to-date earnings per common share at $0.60[1]. - Net income for the year-to-date September 30, 2024, was $6,187,000, a significant decrease from $21,438,000 in 2023, representing a decline of 71.1%[11]. - Earnings per common share decreased to $0.60 for the year-to-date September 30, 2024, down from $2.64 in 2023, a decline of 77.3%[11]. - Earnings per common share (basic and diluted) decreased to $(0.04), compared to $0.77 in the same period last year[17]. - Return on average assets (annualized) dropped to 0.05%, down from 1.30% year-over-year[17]. Interest Income and Margin - The annualized net interest margin for Q3 2024 was 3.05%, impacted by $984,000 in reversed accrued interest income[2]. - Total interest income increased to $99,496,000 for the year-to-date September 30, 2024, compared to $91,239,000 for the same period in 2023, representing an increase of 9.2%[11]. - Net interest income after provision for credit losses decreased to $43,177,000 for the year-to-date September 30, 2024, down from $58,253,000 in 2023, a decline of 26.0%[11]. - Net interest income for the nine months ended September 30, 2024, was $46,754, compared to $59,641 for the same period in 2023, reflecting a decrease in net interest margin from 4.34% to 3.19%[15]. - Net interest income (GAAP) for the three months ended September 30, 2024, was $15,343 thousand, down from $18,772 thousand in the same period of 2023, representing a decline of approximately 18.4%[20]. - Net interest margin (GAAP) decreased to 3.04% for the three months ended September 30, 2024, compared to 3.99% for the same period in 2023, a drop of about 23.8%[20]. Loan and Credit Quality - The company charged off $1.9 million in nonperforming loans during the quarter, with a provision expense allocation of $1 million[2]. - The total principal losses incurred year-to-date 2024 approximated just 0.1% of total loans, indicating strong credit quality[3]. - Non-performing loans amounted to $28,264 thousand, significantly higher than $325 thousand in the same period last year[17]. - The allowance for credit losses increased to $18,327 as of September 30, 2024, compared to $17,098 in June 30, 2024, and $15,626 in September 30, 2023[12]. - Total allowance for credit losses reached $18,472 thousand, compared to $17,178 thousand in the previous year[17]. Deposits and Funding - Total deposits increased to $1.9 billion, with core deposits reaching $1.47 billion, accounting for 78% of total deposits[3]. - Total deposits reached $1,893,669 as of September 30, 2024, reflecting a 7.9% increase from $1,755,363 in June 30, 2024, and a 12.5% increase from $1,683,190 in September 30, 2023[12]. - Non-interest bearing core deposits grew by $33 million during the quarter[4]. - Core customer funding sources increased to $1,471,350, representing 74.8% of total funding sources, up from 75.3% in June 30, 2024, and significantly higher than 65.2% in September 30, 2023[12]. Expenses and Efficiency - Total non-interest income was $2,446,000 for the year-to-date September 30, 2024, compared to $2,583,000 in 2023, reflecting a decrease of 5.3%[11]. - Total non-interest expenses rose to $38,536,000 for the year-to-date September 30, 2024, up from $34,279,000 in 2023, an increase of 12.9%[11]. - The efficiency ratio increased to 81.45%, compared to 58.74% in the previous year[17]. Assets and Equity - Total assets as of September 30, 2024, were $2.22 billion, up from $2.09 billion as of June 30, 2024[10]. - Stockholders' equity increased to $226.05 million as of September 30, 2024, compared to $224.72 million at the end of Q2 2024[10]. - Total stockholders' equity (GAAP) increased to $226,051 thousand as of September 30, 2024, compared to $213,743 thousand as of September 30, 2023, reflecting a growth of approximately 5.8%[19]. - Tangible common stockholders' equity (non-GAAP) rose to $179,907 thousand as of September 30, 2024, up from $173,107 thousand as of September 30, 2023, indicating an increase of about 4.6%[19]. Market and Stock Performance - Closing stock price was $18.45, down from $20.54 in the previous year[17]. - The weighted average number of common shares increased to 7,607,431 for the year-to-date September 30, 2024, compared to 7,521,426 in 2023, an increase of 1.1%[11]. New Initiatives - The Avenu Banking-as-a-Service (BaaS) solution launched just before the end of Q3 2024, aimed at diversifying revenue streams[4]. - Avenu's first fintech client is expected to go live in early November, with plans for four additional fintechs to follow[5].

The market expects MainStreet Bank (MNSB) to deliver a year-over-year decline in earnings on lower revenues when it reports results for the quarter ended September 2024. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be rel ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Securities registered pursuant to Section 12(b) of the Act. Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock MNSB The Nasdaq Stock Market LLC MNSBP The Nasdaq Stock Market LLC FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SE ...

MainStreet Bancshares, Inc. (NASDAQ:MNSB) Q2 2024 Earnings Conference Call July 29, 2024 2:00 PM ET Company Participants Jeff Dick - Chairman and Chief Executive Officer Alex Vari - Chief Accountant Tom Floyd - Chief Lending Officer Tom Chmelik - Chief Financial Officer Conference Call Participants Chris Marinac - Janney Montgomery Scott Matt Breese - Stephens Jeff Dick Everyone and thank you for joining our Virtual Earnings Webcast. My name is Jeff Dick, and I’m the Chairman and CEO of MainStreet Bancshare ...

MainStreet Bank (MNSB) came out with quarterly earnings of $0.27 per share, missing the Zacks Consensus Estimate of $0.32 per share. This compares to earnings of $0.85 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -15.63%. A quarter ago, it was expected that this company would post earnings of $0.52 per share when it actually produced earnings of $0.36, delivering a surprise of -30.77%. Over the last four quarters, the comp ...

Rise in Core Deposits Fueled an Uptick in Loan Growth FAIRFAX, Va., July 29, 2024 /PRNewswire/ -- MainStreet Bancshares, Inc. (Nasdaq: MNSB & MNSBP), the holding company for MainStreet Bank, reported net income of $2.6 million for the second quarter of 2024. Total deposits reached $1.8 billion in the second quarter, an increase of 10.2% from the second quarter of 2023. Loan growth is up 8.6% over the same period, also reaching $1.8 billion. "We are now nine full quarters into the current interest rate cycle ...