John Marshall Bancorp, Inc. (OTCQB: JMSB) (the “Company”), parent company of John Marshall Bank (the “Bank”) reported its financial results for the three months ended March 31, 2019.
Selected Highlights
- Earnings Momentum - The Company reported net income of $3.6 million or $0.27 per diluted share for the three months ended March 31, 2019. This compares to $3.0 million or $0.22 per diluted share for the three months ended December 31, 2018. EPS increased 22.7% on a sequential quarter basis from December 31, 2018 to March 31, 2019.
- Improved Quarterly Returns - Quarterly return on average assets (“ROAA”) increased from 0.89% for the three months ended December 31, 2018, to 1.04% for the three months ended March 31, 2019. Quarterly return on average equity (“ROAE”) increased from 8.57% for the three months ended December 31, 2018, to 10.09% for the three months ended March 31, 2019.
- Improved Efficiency Ratio - The efficiency ratio decreased from 64.4% for the fourth quarter of 2018 to 59.2% for the first quarter of 2019. The Company continues to leverage its 2018 investment in new personnel and new offices.
- Strong Asset Growth - Total assets were $1.43 billion at March 31, 2019, an increase of $193.2 million or 15.7% since March 31, 2018. Total assets increased $30.9 million during the first quarter of 2019, despite a reduction in brokered deposits and other wholesale funding of $27.8 million during the quarter.
- Robust Loan Growth - Gross loans net of unearned income equaled $1.18 billion at March 31, 2019. Gross loans net of unearned income increased $167.0 million or 16.5% since March 31, 2018. Gross loans net of unearned income increased $15.9 million since December 31, 2018, despite higher payoff activity during the quarter.
- Improved Liquidity as Deposit Growth Exceeded Asset Growth - Total deposits amounted to $1.18 billion at March 31, 2019, an increase of $211.6 million or 21.9% since March 31, 2018, including a 23.1% increase in core deposits. Total Deposits increased $40.2 million since December 31, 2018, despite a reduction of QwickRate and brokered deposits of $5.8 million.
- Continued Funding Composition Improvement - Core customer deposits grew $205.4 million or 23.1% since March 31, 2018. Wholesale funding decreased $35.8 million or 19.9% since March 31, 2018. Wholesale funding represented 11.4% of total funding sources at March 31, 2019 compared to 13.8% at December 31, 2018 and 16.5% at March 31, 2018.
Chris Bergstrom, President and Chief Executive Officer, commented “Over the past year the Company has launched initiatives to enhance growth and profitability, diversify the loan and deposit portfolios and reduce non-core funding. The Company remains well positioned to leverage its 2018 investment in personnel and new offices for future growth.”
Balance Sheet Review
Assets
Total assets were $1.43 billion at March 31, 2019, $1.39 billion at December 31, 2018 and $1.23 billion at March 31, 2018. During the first quarter of 2019 assets increased $30.9 million, or 2.2%. Year-over-year asset growth, from March 31, 2018 to March 31, 2019, was $193.2 million, or 15.7%. During the first quarter of 2019, asset growth was restrained as strong core deposit growth was used to pay off Federal funds purchased and reduce brokered deposits and FHLB advances.
Loans
Gross loans were $1.18 billion at March 31, 2019, $1.16 billion at December 31, 2018 and $1.01 billion at March 31, 2018. During the first quarter, gross loans net of unearned income grew $15.9 million or 1.4%. Year-over-year gross loans net of unearned income increased $167.0 million, or 16.5% from March 31, 2018 to March 31, 2019. Loan originations were strong during the first quarter of 2019, but were offset by higher than anticipated loan payoffs or paydowns.
Investment Securities
The Company’s investment portfolio comprised of held-to-maturity and available-for-sale securities was $104.2 million at March 31, 2019, $97.2 million at December 31, 2018 and $96.4 million at March 31, 2018. Year-over-year the investment portfolio growth, from March 31, 2018 to March 31, 2019, was $7.8 million, or 8.0%. As of March 31, 2019, the Company held $31.9 million of its investment portfolio as held-to-maturity, and $72.3 million as available-for-sale. The Company also had restricted securities totaling $7.1 million at March 31, 2019, $7.3 million at December 31, 2018 and $8.4 million at March 31, 2018.
Subsequent to March 31, 2019, the entire held-to-maturity portfolio, totaling $31.9 million was transferred to available-for-sale. The Company’s held-to-maturity portfolio was primarily comprised of municipal bonds whose tax equivalent yield was, on an aggregated basis, lower than agency guaranteed fixed income investment alternatives of a comparable maturity. By moving the held-to-maturity portfolio to available-for-sale, the Company can evaluate economically advantageous opportunities to sell certain municipal bonds and redeploy the proceeds in higher yielding alternatives. The portfolio migration resulted in an immaterial second quarter adjustment to accumulated other comprehensive income (loss) as a result of recording the securities at their fair value on the date of the transfer. The transfer will impact net income only to the extent of any gains or losses realized on the sale of specific securities subsequent to their transfer to the available-for-sale classification.
Interest Bearing Deposits in Banks
Interest-bearing deposits in banks were $96.4 million at March 31, 2019, $93.7 million at December 31, 2018 and $87.1 million at March 31, 2018. The higher cash balances at March 31, 2019 continue to be a result of the recent deposit growth. These funds will continue to be deployed into higher earning assets.
Deposits
Total deposits were $1.18 billion at March 31, 2019, $1.14 billion at December 31, 2018 and $967.0 million at March 31, 2018. During the first quarter, deposits grew $40.2 million or 3.5%. Year-over-year deposit growth, from March 31, 2018 to March 31, 2019, was $211.6 million, or 21.9%. Core customer funding was $1.10 billion at March 31, 2019, $1.05 billion at December 31, 2018 and $890.1 million at March 31, 2018. Year-over-year core customer funding sources increased by $205.4 million, or 23.1%, from March 31, 2018 to March 31, 2019.
ICS deposits were $154.6 million at March 31, 2019, $135.1 million at December 31, 2018 and $68.8 million at March 31, 2018. Year-over-year, ICS deposits increased $85.8 million from March 31, 2018 to March 31, 2019. CDARS were $91.0 million at March 31, 2019, $112.2 million at December 31, 2018 and $91.6 million at March 31, 2018. The decline in CDARS was part of a management decision to not renew higher priced deposits to help improve funding composition.
QwickRate certificates of deposit were $19.6 million at March 31, 2019, $20.6 million at December 31, 2018 and $26.0 million at March 31, 2018. Year-over-year QwickRate certificates of deposit decreased $6.4 million from March 31, 2018 to March 31, 2019. Brokered deposits were $63.4 million at March 31, 2019, $68.2 million at December 31, 2018 and $50.9 million at March 31, 2018. Brokered deposits increased $12.6 million from March 31, 2018 to March 31, 2019.
Core customer funding was 86.6% of all funding sources as of March 31, 2019, as compared to 84.2% at December 31, 2018 and 81.3% as of March 31, 2018. Increasing core customer funding is a key strategic initiative for the Company.
Borrowings
Total borrowings, consisting of Federal Home Loan Bank advances and Federal funds purchased, were $61.5 million at March 31, 2019, $83.5 million at December 31, 2018 and $103.5 million at March 31, 2018. Total borrowings decreased $42.0 million, or 40.6%, from March 31, 2018 to March 31, 2019. Federal Home Loan Bank advances were $61.5 million at March 31, 2019, $68.5 million at December 31, 2018 and $103.5 million at March 31, 2018. The 40.6% decrease year-over-year in borrowings was a result of the overall growth in core customer deposits, as mentioned above.
Wholesale funding, which includes QwickRate certificates, brokered deposits, Federal funds purchased and FHLB borrowings, was $144.6 million at March 31, 2019, $172.3 million at December 31, 2018 and $180.4 million at March 31, 2018. Wholesale funding decreased $27.8 million, or 16.1% during the first three months of 2019. Year-over-year, wholesale funding declined $35.8 million, or 19.9%, from March 31, 2018 to March 31, 2019.
The Company had subordinated notes with balances of $24.6 million at March 31, 2019 and December 31, 2018 and $24.5 million at March 31, 2018. The notes qualify as Tier 2 capital for the Company for regulatory purposes.
Shareholders’ Equity and Capital Levels
Total shareholders’ equity was $147.2 million at March 31, 2019, $142.0 million at December 31, 2018 and $131.6 million at March 31, 2018. Year-over-year shareholders’ equity increased by $15.6 million, or 11.9%. Total common shares outstanding increased from 12,829,888, including 57,550 unvested shares, at March 31, 2018, to 13,034,794, including 59,604 unvested shares, at March 31, 2019.
The Company’s capital ratios remain well above regulatory minimums for well capitalized banks. As of March 31, 2019, the Company’s total risk-based capital ratio was 14.0%, compared to 14.9% at March 31, 2018.
Income Statement Review
Net Interest Income
Net interest income, the Company’s primary source of revenue, was $11.6 million for the three months ended March 31, 2019, up 11.0% from $10.4 million for the three months ended March 31, 2018. The net interest margin was 3.43% for the three months ended March 31, 2019 as compared to 3.60% for the three months ended March 31, 2018. Average net loans increased $155.7 million compared to the three months ended March 31, 2018, with a 25 basis point increase in yield. Average interest-bearing deposits in other banks increased $36.4 million compared to the three months ended March 31, 2018, with an 87 basis point increase in yield. The higher level of interest-bearing deposit balances resulting from the growth in customer deposits have and will continue to be deployed into higher earning assets. The average cost of interest-bearing liabilities increased 59 basis points when comparing the quarter ended March 31, 2018 to the quarter ended March 31, 2019. The Company’s margin compression is reflective of the yield curve as loan yields and yield on earning assets have increased by 25 basis points and 26 basis points, respectively, a significantly lower degree than short term deposit rates.
Provision for Loan Losses
The Company had a $221 thousand provision for loan losses for the three months ended March 31, 2019, compared to a provision of $190 thousand for the same period in 2018. The Company had $169 thousand in net loan charge-offs during the first quarter of 2019, compared to net loan charge-offs of $1 thousand in the first quarter of 2018. The charge-off in the first quarter of 2019 was related to one loan.
Noninterest Income
The Company’s noninterest income consists primarily of bank owned life insurance income and service charges on deposit accounts. The majority of loan fees are included in interest income on the loan portfolio and not reported as noninterest income.
For the three months ended March 31, 2019, the Company reported total noninterest income of $307 thousand, compared to $334 thousand during the three months ended March 31, 2018. Service charges on deposit accounts increased $22 thousand, or 19.3%, for the three months ended March 31, 2019 as compared to the same period in the prior year. The increase in service charges on deposit accounts is mostly related to higher ATM and debit interchange fees collected. Other service charges and fees decreased $38 thousand for the three months ended March 31, 2019 as compared to the same period in the prior year. Other service charges and fees during the first quarter of 2018 were higher due to fees collected on CDARS balances.
Noninterest Expense
For the three months ended March 31, 2019, salaries and employee benefits expense increased 11.1% to $4.6 million, compared to $4.1 million for the same period in 2018. All other noninterest expenses increased by 3.7%, or $86 thousand, during the first quarter of 2019, compared to the same period in 2018.
The increase in salaries and benefits for the three month periods ended March 31, 2019 was primarily attributable to increased employee count year-over-year, including staff for our branch in Woodbridge, Virginia and Tysons Corner, Virginia which converted from a loan production office to a full service branch. In addition to the staff needed at our new locations, over the past year we hired key executives, loan and business development officers as well as support staff in our operations office. The expansion of branches and staff correspond to the overall growth initiatives for the Company. The increase in occupancy and furniture and equipment expenses was mostly related to additional rent and furniture expenses related to the new locations listed above.
Asset Quality
As of March 31, 2019, non-performing assets were 0.10% of total assets, compared to 0.08% at March 31, 2018. As of March 31, 2019, non-accrual loans totaled $1.4 million, up $768 thousand from $638 thousand as of March 31, 2018. During the first quarter of 2019, loans totaling $1.4 million were added to non-accrual, which includes three loans to one borrower, all of which are well secured.
At March 31, 2018, other real estate owned had a balance of $379 thousand. In February 2019, the other real estate owned was sold for $379 thousand. The Company had no other real estate owned as of March 31, 2019.
Troubled debt restructurings were $2.3 million at March 31, 2019, an increase of $1.9 million, compared to $491 thousand at March 31, 2018. During the first quarter of 2019, four loans totaling $1.6 million were added as troubled debt restructurings. There were $935 thousand of the troubled debt restructurings that were performing in accordance with their modified terms as of March 31, 2019.
About John Marshall Bancorp, Inc.
John Marshall Bancorp, Inc. is the bank holding company for John Marshall Bank. John Marshall Bank is headquartered in Reston, Virginia and has eight full-service banking centers located in Reston, Leesburg, Arlington Alexandria, Tysons Corner and Woodbridge, Virginia; Rockville, Maryland; Washington, DC and one loan production office in Arlington, Virginia. Further information on the Bank can be obtained by visiting its website at www.johnmarshallbank.com.
This press release contains forward-looking statements within the meaning of the Securities and Exchange Act of 1934, as amended, including statements of goals, intentions, and expectations as to future trends, plans, events or results of Company operations and policies and regarding general economic conditions. In some cases, forward-looking statements can be identified by use of words such as “may,” “will,” “anticipates,” “believes,” “expects,” “plans,” “estimates,” “potential,” “continue,” “should,” and similar words or phrases. These statements are based upon current and anticipated economic conditions, nationally and in the Company’s market, interest rates and interest rate policy, competitive factors, and other conditions which by their nature, are not susceptible to accurate forecast, and are subject to significant uncertainty. Because of these uncertainties and the assumptions on which this discussion and the forward-looking statements are based, actual future operations and results may differ materially from those indicated herein. Readers are cautioned against placing undue reliance on any such forward-looking statements. The Company’s past results are not necessarily indicative of future performance.
John Marshall Bancorp, Inc. | |||||||||
Financial Highlights (Unaudited) | |||||||||
(Dollar amounts in thousands, except per share data) | |||||||||
At or For the Three Months Ended | |||||||||
March 31, | |||||||||
2019 | 2018 | ||||||||
Selected Balance Sheet Data | |||||||||
Cash and cash equivalents | $ | 5,709 | $ | 5,178 | |||||
Total investment securitites | 111,447 | 104,837 | |||||||
Loans net of unearned income | 1,177,319 | 1,010,362 | |||||||
Allowance for loan losses | 9,783 | 9,117 | |||||||
Total assets | 1,425,477 | 1,232,289 | |||||||
Non-interest bearing demand deposits | 228,826 | 185,151 | |||||||
Interest bearing deposits | 949,708 | 781,802 | |||||||
Total deposits | 1,178,534 | 966,953 | |||||||
Shareholders' equity | 147,226 | 131,627 | |||||||
Summary Results of Operations | |||||||||
Interest income | $ | 16,377 |
| $ | 13,281 | ||||
Interest expense | 4,798 |
| 2,853 | ||||||
Net interest income | 11,579 | 10,428 | |||||||
Provision for loan losses | 221 |
| 190 | ||||||
Net interest income after provision for loan losses | 11,358 | 10,238 | |||||||
Noninterest income | 307 |
| 334 | ||||||
Noninterest expense | 7,033 |
| 6,485 | ||||||
Income before income taxes | 4,632 |
| 4,087 | ||||||
Net income | 3,610 |
| 3,244 | ||||||
Per share Data and Shares Outstanding | |||||||||
Earnings per share - basic | $ | 0.28 | $ | 0.25 | |||||
Earnings per share - diluted | $ | 0.27 | $ | 0.24 | |||||
Tangible book value per share | $ | 11.29 | $ | 10.26 | |||||
Weighted average common shares (basic) | 12,910,845 | 12,826,941 | |||||||
Weighted average common shares (diluted) | 13,532,074 | 13,572,417 | |||||||
Common shares outstanding at end of period | 13,034,794 | 12,829,888 | |||||||
Performance Ratios | |||||||||
Return on average assets (annualized) | 1.04% | 1.09% | |||||||
Return on average equity (annualized) | 10.09% | 10.07% | |||||||
Net interest margin | 3.43% | 3.60% | |||||||
Noninterest income as a percentage of average assets (annualized) | 0.09% | 0.11% | |||||||
Noninterest expense to average assets (annualized) | 2.03% | 2.18% | |||||||
Efficiency ratio | 59.2% | 60.3% | |||||||
Asset Quality | |||||||||
Non-performing assets to total assets | 0.10% | 0.08% | |||||||
Non-performing loans to total loans | 0.12% | 0.06% | |||||||
Allowance for loan losses to non-performing loans | 7.0x | 14.3x | |||||||
Allowance for loan losses to total loans | 0.83% | 0.90% | |||||||
Net charge-offs to average loans (annualized) | 0.06% | 0.00% | |||||||
Loans 30-89 days past due and accruing interest | $ | - - | $ | - - | |||||
Non-accrual loans | $ | 1,406 | $ | 638 | |||||
Other real estate owned | $ | - - | $ | 379 | |||||
Non-performing assets (1) | $ | 1,406 | $ | 1,017 | |||||
Troubled debt restructurings (total) | $ | 2,341 | $ | 491 | |||||
Performing in accordance with modified terms | $ | 935 | $ | 491 | |||||
Not performing in accordance with modified terms | $ | 1,406 | $ | - - | |||||
Capital Ratios | |||||||||
Tangible equity / tangible assets | 10.3% | 10.7% | |||||||
Total risk-based capital ratio | 14.0% | 14.9% | |||||||
Tier 1 risk-based capital ratio | 11.3% | 11.9% | |||||||
Leverage ratio | 10.5% | 11.0% | |||||||
Common equity tier 1 ratio | 11.3% | 11.9% | |||||||
Other Information | |||||||||
Number of full time equivalent employees | 141 | 126 | |||||||
# Full service branch offices | 8 | 6 | |||||||
# Loan production or limited service branch offices | 1 | 2 | |||||||
(1) Non-performing assets consist of non-accrual loans, loans 90 day or more past due and still accruing interest, and other real estate owned. Does not include troubled debt restructurings ("TDRs") which were accruing interest at the date indicated. |
John Marshall Bancorp, Inc. | ||||||||||||||||||
Consolidated Balance Sheets | ||||||||||||||||||
(Dollar amounts in thousands, except per share data) | ||||||||||||||||||
% Change | ||||||||||||||||||
March 31, | December 31, | March 31, | Last Three | Year Over | ||||||||||||||
2019 | 2018 | 2018 | Months | Year | ||||||||||||||
Assets | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||
Cash and due from banks | $ | 5,709 | $ | 7,853 | $ | 5,178 | -27.3% | 10.3% | ||||||||||
Interest-bearing deposits in banks | 96,376 | 93,716 | 87,098 | 2.8% | 10.7% | |||||||||||||
Federal funds sold | 78 | 126 | 80 | -38.1% | -2.5% | |||||||||||||
Securities available-for-sale, at fair value | 72,284 | 61,055 | 55,702 | 18.4% | 29.8% | |||||||||||||
Securities held-to-maturity, fair value of $31,801 at 3/31/2019, $35,589 at 12/31/2018 and $39,902 at 3/31/2018 | 31,896 | 36,177 | 40,720 | -11.8% | -21.7% | |||||||||||||
Restricted securities, at cost | 7,147 | 7,283 | 8,415 | -1.9% | -15.1% | |||||||||||||
Equity securitites, at fair value | 120 | 120 | - - | 0.0% | N/M | |||||||||||||
Loans net of unearned income | 1,177,319 | 1,161,455 | 1,010,362 | 1.4% | 16.5% | |||||||||||||
Allowance for loan losses | (9,783) | (9,731) | (9,117) | 0.5% | 7.3% | |||||||||||||
Net loans | 1,167,536 | 1,151,724 | 1,001,245 | 1.4% | 16.6% | |||||||||||||
Bank premises and equipment, net | 2,668 | 2,852 | 2,480 | -6.5% | 7.6% | |||||||||||||
Accrued interest receivable | 4,030 | 3,623 | 3,125 | 11.2% | 29.0% | |||||||||||||
Bank owned life insurance | 19,743 | 19,617 | 19,224 | 0.6% | 2.7% | |||||||||||||
Other real estate owned | - - | 379 | 379 | N/M | N/M | |||||||||||||
Right of use assets | 9,204 | - - | - - | N/M | N/M | |||||||||||||
Other assets | 8,686 | 10,096 | 8,643 | -14.0% | 0.5% | |||||||||||||
Total assets | $ | 1,425,477 | $ | 1,394,621 | $ | 1,232,289 | 2.2% | 15.7% | ||||||||||
Liabilities and Shareholders' Equity | ||||||||||||||||||
Liabilities | ||||||||||||||||||
Deposits: | ||||||||||||||||||
Non-interest bearing demand deposits | $ | 228,826 | $ | 222,299 | $ | 185,151 | 2.9% | 23.6% | ||||||||||
Interest bearing demand deposits | 430,512 | 367,656 | 293,171 | 17.1% | 46.8% | |||||||||||||
Savings deposits | 15,628 | 6,987 | 7,163 | 123.7% | 118.2% | |||||||||||||
Time deposits | 503,568 | 541,426 | 481,468 | -7.0% | 4.6% | |||||||||||||
Total deposits | 1,178,534 | 1,138,368 | 966,953 | 3.5% | 21.9% | |||||||||||||
Federal funds purchased | - - | 15,001 | - - | N/M | N/M | |||||||||||||
Federal Home Loan Bank advances | 61,500 | 68,500 | 103,500 | -10.2% | -40.6% | |||||||||||||
Subordinated debt | 24,593 | 24,581 | 24,544 | 0.0% | 0.2% | |||||||||||||
Accrued interest payable | 780 | 1,243 | 736 | -37.2% | 6.0% | |||||||||||||
Lease liabilities | 9,431 | - - | - - | N/M | N/M | |||||||||||||
Other liabilities | 3,413 | 4,910 | 4,929 | -30.5% | -30.8% | |||||||||||||
Total liabilities | 1,278,251 | 1,252,603 | 1,100,662 | 2.0% | 16.1% | |||||||||||||
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Shareholders' Equity | ||||||||||||||||||
Preferred stock, par value $0.01 per share; authorized 1,000,000 shares; none issued | - - | - - | - - | - - | - - | |||||||||||||
Common stock, nonvoting, par value $0.01 per share; authorized 1,000,000 shares; none issued | - - | - - | - - | - - | - - | |||||||||||||
Common stock, voting, par value $0.01 per share; authorized 20,000,000 shares; issued and outstanding, 13,034,794 at 3/31/2019 including 59,604 unvested shares, 12,900,125 shares at 12/31/2018 including 86,400 unvested shares and 12,829,888 at 3/31/18, including 57,550 unvested shares | 130 | 128 | 128 | 1.6% | 1.6% | |||||||||||||
Additional paid-in capital | 86,052 | 85,127 | 84,077 | 1.1% | 2.3% | |||||||||||||
Retained earnings | 61,329 | 57,718 | 48,676 | 6.3% | 26.0% | |||||||||||||
Accumulated other comprehensive loss | (285) | (955) | (1,254) | 70.2% | 77.3% | |||||||||||||
Total shareholders' equity | 147,226 | 142,018 | 131,627 | 3.7% | 11.9% | |||||||||||||
Total liabilities and shareholders' equity | $ | 1,425,477 | $ | 1,394,621 | $ | 1,232,289 | 2.2% | 15.7% | ||||||||||
John Marshall Bancorp, Inc. | ||||||||||||
Consolidated Statements of Income | ||||||||||||
(Dollar amounts in thousands, except per share data) | ||||||||||||
| ||||||||||||
Three Months Ended | ||||||||||||
March 31, | ||||||||||||
2019 | 2018 | % Change | ||||||||||
(Unaudited) | (Unaudited) | |||||||||||
Interest and Dividend Income | ||||||||||||
Interest and fees on loans | $ | 15,078 | $ | 12,436 | 21.2% | |||||||
Interest on investment securities, taxable | 529 | 414 | 27.8% | |||||||||
Interest on investment securities, tax-exempt | 72 | 85 | -15.3% | |||||||||
Dividends | 116 | 114 | 1.8% | |||||||||
Interest on federal funds sold | 1 | - - | N/M | |||||||||
Interest on deposits in banks | 581 | 232 | 150.4% | |||||||||
Total interest and dividend income | 16,377 | 13,281 | 23.3% | |||||||||
Interest Expense | ||||||||||||
Deposits | 4,086 | 2,068 | 97.6% | |||||||||
Federal Home Loan Bank advances | 338 | 411 | -17.8% | |||||||||
Subordinated debt | 372 | 372 | 0.0% | |||||||||
Other short-term borrowings | 2 | 2 | 0.0% | |||||||||
Total interest expense | 4,798 | 2,853 | 68.2% | |||||||||
Net interest income | 11,579 | 10,428 | 11.0% | |||||||||
Provision for loan losses | 221 | 190 | 16.3% | |||||||||
Net interest income after provision for loan losses | 11,358 | 10,238 | 10.9% | |||||||||
Noninterest Income | ||||||||||||
Service charges on deposit accounts | 136 | 114 | 19.3% | |||||||||
Bank owned life insurance | 126 | 131 | -3.8% | |||||||||
Other service charges and fees | 43 | 81 | -46.9% | |||||||||
Other operating income | 2 | 8 | N/M | |||||||||
Total noninterest income | 307 | 334 | -8.1% | |||||||||
Noninterest Expenses | ||||||||||||
Salaries and employee benefits | 4,610 | 4,148 | 11.1% | |||||||||
Occupancy expense of premises | 540 | 511 | 5.7% | |||||||||
Furniture and equipment expenses | 335 | 302 | 10.9% | |||||||||
Other operating expenses | 1,548 | 1,524 | 1.6% | |||||||||
Total noninterest expenses | 7,033 | 6,485 | 8.5% | |||||||||
Income before income taxes | 4,632 | 4,087 | 13.3% | |||||||||
Income tax expense | 1,022 |
| 843 | 21.2% | ||||||||
Net income | $ | 3,610 | $ | 3,244 | 11.3% | |||||||
Earnings Per Share | ||||||||||||
Basic | $ | 0.28 | $ | 0.25 | 12.0% | |||||||
Diluted | $ | 0.27 | $ | 0.24 | 12.5% | |||||||
John Marshall Bancorp, Inc. | ||||||||||||||||||||||||||||
Loan, Deposit and Borrowing Detail (Unaudited) | ||||||||||||||||||||||||||||
(Dollar amounts in thousands) | ||||||||||||||||||||||||||||
March 31, 2019 | December 31, 2018 | March 31, 2018 | Percentage Change | |||||||||||||||||||||||||
Loans | $ Amount | % of Total | $ Amount | % of Total | $ Amount | % of Total | Last 3 Mos | Last 12 Mos | ||||||||||||||||||||
Mortgage loans on real estate | ||||||||||||||||||||||||||||
Commercial | $ | 736,620 | 62.5% | $ | 747,342 | 64.2% | $ | 610,735 | 60.3% | -1.4% | 20.6% | |||||||||||||||||
Construction and land development | 226,499 | 19.2% | 204,986 | 17.6% | 197,813 | 19.6% | 10.5% | 14.5% | ||||||||||||||||||||
Residential | 149,437 | 12.7% | 143,811 | 12.4% | 140,589 | 13.9% | 3.9% | 6.3% | ||||||||||||||||||||
Total mortgage loans on real estate | $ | 1,112,556 | 94.4% | $ | 1,096,139 | 94.2% | $ | 949,137 | 93.8% | 1.5% | 17.2% | |||||||||||||||||
Commercial loans | 65,334 | 5.5% | 65,815 | 5.7% | 61,722 | 6.1% | -0.7% | 5.9% | ||||||||||||||||||||
Consumer loans | 777 | 0.1% | 1,198 | 0.1% | 1,304 | 0.1% | -35.1% | -40.4% | ||||||||||||||||||||
Total loans | $ | 1,178,667 | 100.0% | $ | 1,163,152 | 100.0% | $ | 1,012,163 | 100.0% | 1.3% | 16.5% | |||||||||||||||||
Less: Allowance for loan losses | (9,783) | (9,731) | (9,117) | |||||||||||||||||||||||||
Net deferred loan fees | (1,348) | (1,697) | (1,801) | |||||||||||||||||||||||||
Net loans | $ | 1,167,536 | $ | 1,151,724 | $ | 1,001,245 | ||||||||||||||||||||||
March 31, 2019 | December 31, 2018 | March 31, 2018 | Percentage Change | |||||||||||||||||||||||||
Deposits | $ Amount | % of Total | $ Amount | % of Total | $ Amount | % of Total | Last 3 Mos | Last 12 Mos | ||||||||||||||||||||
Noninterest-bearing demand deposits | $ | 228,826 | 19.4% | $ | 222,299 | 19.5% | $ | 185,151 | 19.1% | 2.9% | 23.6% | |||||||||||||||||
Interest-bearing demand deposits: | ||||||||||||||||||||||||||||
NOW accounts | 70,933 | 6.0% | 44,884 | 3.9% | 46,148 | 4.8% | 58.0% | 53.7% | ||||||||||||||||||||
Money market accounts | 204,996 | 17.4% | 186,626 | 16.4% | 171,475 | 17.7% | 9.8% | 19.5% | ||||||||||||||||||||
Savings accounts | 15,628 | 1.3% | 6,987 | 0.6% | 7,163 | 0.7% | 123.7% | 118.2% | ||||||||||||||||||||
Certificates of deposit | ||||||||||||||||||||||||||||
$250,000 or more | 215,304 | 18.3% | 232,491 | 20.4% | 207,402 | 21.5% | -7.4% | 3.8% | ||||||||||||||||||||
Less than $250,000 | 114,233 | 9.7% | 108,911 | 9.6% | 112,392 | 11.6% | 4.9% | 1.6% | ||||||||||||||||||||
QwickRate® Certificates of deposit | 19,645 | 1.7% | 20,642 | 1.8% | 26,024 | 2.7% | -4.8% | -24.5% | ||||||||||||||||||||
ICS® | 154,579 | 13.1% | 135,135 | 11.9% | 68,788 | 7.1% | 14.4% | 124.7% | ||||||||||||||||||||
CDARS® | 90,977 | 7.7% | 112,196 | 9.9% | 91,560 | 9.5% | -18.9% | -0.6% | ||||||||||||||||||||
Brokered deposits | 63,413 | 5.4% | 68,197 | 6.0% | 50,850 | 5.3% | -7.0% | 24.7% | ||||||||||||||||||||
Total deposits | $ | 1,178,534 | 100.0% | $ | 1,138,368 | 100.0% | $ | 966,953 | 100.0% | 3.5% | 21.9% | |||||||||||||||||
Borrowings | ||||||||||||||||||||||||||||
Federal funds purchased | $ | - - | N/M | $ | 15,001 | 13.9% | $ | - - | N/M | N/M | N/M | |||||||||||||||||
Federal Home Loan Bank advances | 61,500 | 71.4% | 68,500 | 63.4% | 103,500 | 80.8% | -10.2% | -40.6% | ||||||||||||||||||||
Subordinated debt | 24,593 | 28.6% | 24,581 | 22.7% | 24,544 | 19.2% | 0.0% | 0.2% | ||||||||||||||||||||
Total borrowings | $ | 86,093 | 100.0% | $ | 108,082 | 100.0% | $ | 128,044 | 100.0% | -20.3% | -32.8% | |||||||||||||||||
Total deposits and borrowings | $ | 1,264,627 | $ | 1,246,450 | $ | 1,094,997 | 1.5% | 15.5% | ||||||||||||||||||||
Core customer funding sources (1) | $ | 1,095,476 | 86.6% | $ | 1,049,529 | 84.2% | $ | 890,079 | 81.3% | 4.4% | 23.1% | |||||||||||||||||
Wholesale funding sources (2) | 144,558 | 11.4% | 172,340 | 13.8% | 180,374 | 16.5% | -16.1% | -19.9% | ||||||||||||||||||||
Subordinated debt (3) | 24,593 | 2.0% | 24,581 | 2.0% | 24,544 | 2.2% | 0.0% | 0.2% | ||||||||||||||||||||
Total funding sources | $ | 1,264,627 | 100.0% | $ | 1,246,450 | 100.0% | $ | 1,094,997 | 100.0% | -11.7% | 3.4% | |||||||||||||||||
(1) Includes ICS and CDARS(r), which are all reciprocal deposits maintained by customers. |
(2) Consists of QwickRate(r) certificates of deposit, brokered deposits and Federal Home Loan Bank advances |
(3) Subordinated debt obligation qualifies as Tier 2 capital. |
John Marshall Bancorp, Inc. | ||||||||||||||||||||
Average Balance Sheets, Interest and Rates (unaudited) | ||||||||||||||||||||
(Dollar amounts in thousands) | ||||||||||||||||||||
Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | |||||||||||||||||||
Interest | Average | Interest | Average | |||||||||||||||||
Average | Income- | Yields | Average | Income- | Yields | |||||||||||||||
Balance | Expense | /Rates | Balance | Expense | /Rates | |||||||||||||||
Assets | ||||||||||||||||||||
Securities | $ | 107,332 | $ | 717 | 2.71% | $ | 105,009 | $ | 613 | 2.37% | ||||||||||
Loans, net of unearned income | 1,165,002 | 15,078 | 5.25% | 1,009,332 | 12,436 | 5.00% | ||||||||||||||
Interest-bearing deposits in other banks | 96,444 | 581 | 2.44% | 60,030 | 232 | 1.57% | ||||||||||||||
Federal funds sold | 115 | 1 | 3.53% | 62 | - - | 0.00% | ||||||||||||||
Total interest-earning assets | $ | 1,368,893 | $ | 16,377 | 4.85% | $ | 1,174,433 | $ | 13,281 | 4.59% | ||||||||||
Other assets | 33,585 | 31,154 | ||||||||||||||||||
Total assets | $ | 1,402,478 | $ | 1,205,587 | ||||||||||||||||
Liabilities & Shareholders' equity | ||||||||||||||||||||
Interest-bearing deposits | ||||||||||||||||||||
NOW accounts | $ | 122,517 | $ | 347 | 1.15% | $ | 58,152 | $ | 55 | 0.38% | ||||||||||
Money market accounts | 278,890 | 1,033 | 1.50% | 210,418 | 385 | 0.74% | ||||||||||||||
Savings accounts | 9,965 | 16 | 0.65% | 6,853 | 4 | 0.24% | ||||||||||||||
Time deposits | 521,409 | 2,690 | 2.09% | 469,297 | 1,624 | 1.40% | ||||||||||||||
Total interest-bearing deposits | $ | 932,781 | $ | 4,086 | 1.78% | $ | 744,720 | $ | 2,068 | 1.13% | ||||||||||
Federal funds purchased | $ | 300 | $ | 2 | 2.70% | $ | 333 | $ | 2 | 2.44% | ||||||||||
Subordinated debt | 24,585 | 372 | 6.14% | 24,536 | 372 | 6.15% | ||||||||||||||
Other borrowed funds | 67,133 | 338 | 2.04% | 114,128 | 411 | 1.46% | ||||||||||||||
Total interest-bearing liabilities | $ | 1,024,799 | $ | 4,798 | 1.90% | $ | 883,717 | $ | 2,853 | 1.31% | ||||||||||
Demand deposits and other liabilities | 232,580 | 191,168 | ||||||||||||||||||
Total liabilities | $ | 1,257,379 | $ | 1,074,885 | ||||||||||||||||
Shareholders' equity | 145,099 | 130,702 | ||||||||||||||||||
Total liabilities and shareholders' equity | $ | 1,402,478 | $ | 1,205,587 | ||||||||||||||||
Interest rate spread | 2.95% | 3.28% | ||||||||||||||||||
Net interest income and margin | $ | 11,579 | 3.43% | $ | 10,428 | 3.60% | ||||||||||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20190422005568/en/
Chris Bergstrom
(703) 584-0840