MetroCity Bankshares(MCBS) - 2025 Q2 - Quarterly Report

Part I. Financial Information Item 1. Financial Statements Presents unaudited consolidated financial statements for Q2 2025 and FY 2024, along with detailed accounting notes Consolidated Balance Sheets Table | Metric | June 30, 2025 (Unaudited) | December 31, 2024 | | :---------------------------------------------------------------- | :-------------------------- | :------------------ | | Assets: | | | | Total assets | $ 3,615,688 | $ 3,594,045 | | Cash and cash equivalents | $ 286,011 | $ 249,875 | | Loans, less allowance for credit losses | $ 3,102,786 | $ 3,139,191 | | Liabilities: | | | | Total deposits | $ 2,689,493 | $ 2,736,798 | | Federal Home Loan Bank advances | $ 425,000 | $ 375,000 | | Total liabilities | $ 3,179,588 | $ 3,172,692 | | Shareholders' Equity: | | | | Total shareholders' equity | $ 436,100 | $ 421,353 | - Total assets increased by $21.6 million (0.6%) to $3.62 billion at June 30, 2025, compared to $3.59 billion at December 31, 2024, driven by increases in cash, other assets, equity securities, and loans held for sale[12][182] Consolidated Statements of Income Table | Metric (Dollars in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total interest income | $ 54,049 | $ 54,108 | $ 106,568 | $ 106,466 | | Total interest expense | $ 21,871 | $ 23,396 | $ 43,836 | $ 48,669 | | Net interest income | $ 32,178 | $ 30,712 | $ 62,732 | $ 57,797 | | Provision for credit losses | $ 129 | $ (128) | $ 264 | $ (268) | | Total noninterest income | $ 5,733 | $ 5,559 | $ 11,189 | $ 11,127 | | Total noninterest expense | $ 14,113 | $ 13,032 | $ 27,912 | $ 25,393 | | Net income available to common shareholders | $ 16,826 | $ 16,937 | $ 33,123 | $ 31,567 | | Basic earnings per share | $ 0.66 | $ 0.67 | $ 1.30 | $ 1.25 | | Diluted earnings per share | $ 0.65 | $ 0.66 | $ 1.29 | $ 1.24 | - Net income for Q2 2025 decreased by $111 thousand (0.7%) to $16.8 million, primarily due to increased noninterest expense, income tax expense, and provision for credit losses, partially offset by higher net interest income and noninterest income[135] - For H1 2025, net income increased by $1.6 million (4.9%) to $33.1 million, driven by increased net interest income and noninterest income, partially offset by higher noninterest expense, provision for credit losses, and income tax expense[136] Consolidated Statements of Comprehensive Income Table | Metric (Dollars in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $ 16,826 | $ 16,937 | $ 33,123 | $ 31,567 | | Other comprehensive (loss) gain | $ (3,373) | $ (1,765) | $ (7,592) | $ 3,372 | | Comprehensive income | $ 13,453 | $ 15,172 | $ 25,531 | $ 34,939 | - Comprehensive income decreased for both the three and six months ended June 30, 2025, compared to the prior year, primarily due to higher other comprehensive losses from net changes in the fair value of cash flow hedges[14] Consolidated Statements of Shareholders' Equity Table | Metric (Dollars in thousands) | June 30, 2025 | June 30, 2024 | | :------------------------------ | :------------ | :------------ | | Total Shareholders' Equity (Three Months Ended) | $ 436,100 | $ 407,228 | | Total Shareholders' Equity (Six Months Ended) | $ 436,100 | $ 407,228 | | Dividends declared on common stock (Q2 2025) | $ 5,890 | $ 5,088 | | Dividends declared on common stock (H1 2025) | $ 11,781 | $ 10,174 | - Total shareholders' equity increased to $436.1 million at June 30, 2025, from $427.9 million at April 1, 2025, primarily due to net income and stock-based compensation expense, partially offset by other comprehensive loss and dividends declared[16] Consolidated Statements of Cash Flows Table | Metric (Dollars in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------ | :----------------------------- | :----------------------------- | | Net cash flow provided by operating activities | $ 26,362 | $ 55,720 | | Net cash flow used in investing activities | $ 19,911 | $ 72,502 | | Net cash flow provided by financing activities | $ (10,137) | $ 54,832 | | Net change in cash and cash equivalents | $ 36,136 | $ 183,054 | | Cash and cash equivalents at end of period | $ 286,011 | $ 327,859 | - Net cash flow provided by operating activities decreased significantly in H1 2025 to $26.4 million from $55.7 million in H1 2024[17][18] - Net cash flow from investing activities also decreased to $19.9 million from $72.5 million[17][18] - Financing activities shifted from providing $54.8 million in H1 2024 to using $10.1 million in H1 2025, primarily due to a decrease in deposits and FHLB advance repayments[17][18] Notes to Consolidated Financial Statements NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company operates in community banking, adheres to GAAP, adopted no new policies, and anticipates no material adverse effect from legal proceedings - The Company operates principally in one business segment, community banking, with financial performance evaluated on a Company-wide basis[22][27] - No new accounting policies or significant changes to existing policies were adopted during the first six months of 2025 that materially affected the Company's results or financial condition[25] - Management believes that outstanding legal proceedings will not have a material adverse effect on the Company's results of operations or financial condition[26] NOTE 2 – INVESTMENT SECURITIES Securities available for sale decreased to $15.0 million, while equity securities increased to $18.5 million, recognizing an unrealized gain of $181 thousand for H1 2025 NOTE 2 – INVESTMENT SECURITIES Table | Metric (Dollars in thousands) | June 30, 2025 | December 31, 2024 | | :------------------------------ | :------------ | :---------------- | | Securities available for sale (Fair Value) | $ 15,030 | $ 17,391 | | Equity securities (Carrying Value) | $ 18,481 | $ 10,300 | | Gross Unrealized Losses (Securities available for sale) | $ (3,510) | $ (3,284) | - All 20 securities available for sale with unrealized losses at June 30, 2025, have been in a loss position for over twelve months, depreciating 21.93% from amortized cost, but are not considered credit-impaired[35][36