John Marshall Bank (OTCQB: JMSB) (the “Bank”) reported net income of $8.3 million for the year ended December 31, 2016, a decrease of $566 thousand, or 6.4%, as compared to net income of $8.9 million for the year ended December 31, 2015. Net income per diluted share decreased during 2016 to $0.79 per share, compared to $0.85 per share during 2015. The decrease in year-over-year earnings was attributable to an increased loan loss provision of $3.8 million in 2016 compared to $1.2 million in 2015. The Bank incurred a $1.9 million charge-off during the first quarter, as previously disclosed in the earnings release for the first quarter of 2016. The Bank also incurred an additional $415 thousand charge-off related to the same borrower in the third quarter of 2016.
For the twelve months ended December 31, 2016 the Bank produced a 0.85% return on average assets and 7.27% on average equity, compared to 1.04% and 8.44%, respectively during 2015.
For the fourth quarter of 2016, the Bank reported net income of $2.7 million, a 16.8% increase as compared to $2.3 million during the same period in 2015. Net income per diluted share was $0.25 during the three months ended December 31, 2016, compared to $0.22 per diluted share during the same period in 2015. The Bank’s fourth quarter results produced an annualized return of 1.03% on average assets and 9.09% on average equity, compared to 1.02% and 8.44%, respectively, for the same period a year ago. As of December 31, 2016, the Bank’s tangible book value per share was $11.72, up 7.4% compared to $10.91 as of December 31, 2015.
The Bank’s capital ratios remain well above regulatory minimums for well capitalized banks. As of December 31, 2016, the Bank’s total risk-based capital ratio was 12.3%, compared to 13.6% at December 31, 2015.
Balance Sheet Review
At December 31, 2016, total assets were $1.08 billion, an increase of $146.5 million, or 15.8%, from total assets of $928.6 million at December 31, 2015. Gross loans increased $112.9 million, or 14.4%, to $896.0 million at December 31, 2016, compared to $783.2 million at December 31, 2015. The Bank’s investment portfolio comprised of held-to-maturity, available-for-sale, and restricted securities, increased to $100.3 million at December 31, 2016, compared to $84.8 million at December 31, 2015. As of December 31, 2016 the Bank held $44.1 million of its investment portfolio as held-to-maturity, and $48.3 million as available-for-sale. The Bank had no other real estate owned (“OREO”) as of December 31, 2016 and 2015.
The Bank purchased $18.0 million of bank owned life insurance during the first quarter of 2016. Bank owned life insurance represents insurance policies on officers and directors of the Bank. The cash values of the policies are estimates using information provided by insurance carriers. These policies are carried at their cash surrender value, which approximates their fair value. As of December 31, 2016, the estimated fair value was $18.5 million.
Total deposits were $832.9 million at December 31, 2016, representing an increase of $102.0 million, or 14.0%, compared to $730.9 million at December 31, 2015. Total borrowings, consisting of Federal Home Loan Bank advances and customer repurchase agreements, were $118.2 million at December 31, 2016, an increase of $35.2 million, or 42.5%, compared to $83.0 million at December 31, 2015.
QwickRate certificates of deposit decreased by $2.2 million from $25.0 million at December 31, 2015 to $22.8 million at December 31, 2016. CDARs increased $8.9 million from $62.9 million at December 31, 2015 to $71.8 million at December 31, 2016. Brokered certificates of deposit increased by $24.4 million from $22.5 million at December 31, 2015 to $46.9 million at December 31, 2016. Year-over-year Federal Home Loan Bank advances increased by $33.0 million, or 46.5%. Core customer funding sources increased by $82.0 million, or 11.8%, from $695.3 million at December 31, 2015 to $777.3 million at December 31, 2016.
Total shareholders’ equity was $118.8 million at December 31, 2016, an increase of $9.5 million, or 8.7%, compared to $109.3 million at December 31, 2015. The majority of the increase in shareholders’ equity is attributed to net income of $8.3 million during 2016, and net proceeds from the exercise of 120,575 director and employee stock options during the year. Total common shares outstanding increased from 10,016,574 at December 31, 2015 to 10,137,149 at December 31, 2016.
Income Statement Review
Net interest income
Net interest income, the Bank’s primary source of revenue, was $36.1 million for the year ended December 31, 2016, up 7.2% from $33.7 million for the year ended December 31, 2015. The net interest margin was 3.79% for the year ended December 31, 2016 as compared to 4.01% for the year ended December 31, 2015. The decline in the net interest margin during 2016 is primarily attributed to a decline in the Bank’s yield on earning assets to 4.45% during 2016 from 4.64% in 2015, which is substantially the result of a 19 basis point year-over-year decline in loan yield. The average balance for loans, net of unearned income, increased $92.5 million and securities increased $11.3 million from December 31, 2015 to December 31, 2016.
Net interest income was $9.5 million for the fourth quarter of 2016, compared to $8.7 million for the same period in 2015. The net interest margin was 3.77% for the fourth quarter of 2016, compared to 3.88% during the fourth quarter of 2015. The decline in the net interest margin is mostly attributed to the decline in the Bank’s yield on loans from 4.96% during the fourth quarter of 2015 to 4.85% during the fourth quarter of 2016.
Despite the decline in the net interest margin over the past year, net interest income increased by 7.2% during 2016, compared to 2015, resulting primarily from a $113.1 million, or 13.5%, increase in average earning assets from December 31, 2016, compared to December 31, 2015.
Provision for loan losses
The Bank recognized a provision for loan losses of $3.8 million for the year ended December 31, 2016, compared to provision of $1.2 million for the year ended December 31, 2015. The Bank reported net loan charge-offs of $2.7 million in 2016, compared to net loan charge-offs of $573 thousand in 2015. During the first quarter 2016, the Bank incurred a $1.9 million charge-off as previously disclosed in the earnings release for the first quarter of 2016. During the third quarter 2016, the Bank incurred an additional $415 thousand charge-off related to the same borrower.
The Bank’s provision for loan losses was $480 thousand during the fourth quarter of 2016, compared to $145 thousand during the fourth quarter of 2015. The increase for the quarter was attributable to the loan growth which occurred in the fourth quarter of 2016. In addition, the Bank reported net loan charge-offs of $77 thousand during the fourth quarter of 2016, compared to net recoveries of $48 thousand in the same period in 2015.
Noninterest income
The Bank’s noninterest income consists primarily of bank owned life insurance income and service charges on deposit accounts. Loan fees are included in interest income on the loan portfolio and not reported as noninterest income.
For the year ended December 31, 2016, the Bank reported total noninterest income of $1.0 million, compared to $579 thousand during the year ended December 31, 2015, an increase of 76.7%. For the three months ended December 31, 2016, the Bank’s noninterest income was $286 thousand, compared to $157 thousand during the same period in 2015. The year-over-year increase for both the three and twelve month periods ended December 31, 2016 was attributable to income related to bank owned life insurance that was purchased in the first quarter of 2016. The year-over-year decline in service charge income was partially related to fees waived during our core conversion in April 2016.
Noninterest expense
The largest component of the Bank’s noninterest expense is employee salaries and benefits. Salaries and employee benefits expense increased by 9.9% during 2016 to $12.5 million, compared to $11.4 million during 2015. All other noninterest expense increased by $570 thousand during 2016, from $7.9 million in 2015 to $8.4 million in 2016, an increase of 7.3%.
For the three months ended December 31, 2016, salaries and employee benefits expense increased 16.7% to $3.3 million, compared to $2.9 million for the same period in 2015. All other noninterest expenses totaled $2.1 million during the fourth quarter of 2016, a decrease of 8.3% compared to $2.3 million reported for the same period in 2015.
The increase in other operating expense was associated to higher FDIC insurance related to growth, franchise tax, loan collection fees related to the non-performing loans and one-time costs incurred related to the Bank’s core system conversion which took place in April 2016. There was $1 thousand in other real estate owned expense in 2016.
Asset Quality Review
As of December 31, 2016, non-performing assets were 0.01% of total assets, down from 0.32% at December 31, 2015. The Bank’s allowance for loan losses covered non-performing loans by 149.1 times as of December 31, 2016, compared to 2.4 times as of December 31, 2015. The majority of the decrease in non-performing assets was related to $2.5 million in loans to one borrower of which $310 thousand was charged-off in 2016 and the remaining balance of $2.2 million was paid-off.
As of December 31, 2016, there were $1.0 million in loans 30-89 days past due and still accruing interest. As of December 31, 2015 there were no loans 30-89 days past due and still accruing interest.
Troubled debt restructurings were $508 thousand at December 31, 2016, a decrease of $877 thousand, or 65.5%, from $1.5 million as of December 31, 2015. All troubled debt restructurings were performing in accordance with modified terms as of December 31, 2016. There was no other real estate owned as of December 31, 2016 and 2015.
John Marshall Bank is headquartered in Reston, Virginia and has five full-service branches located in Reston, Leesburg, Arlington, Alexandria and Rockville. The Bank also has two limited-service commercial branches located in Washington, DC and Tysons Corner, VA. 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 Bank 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 Bank’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 Bank’s past results are not necessarily indicative of future performance.
John Marshall Bank | |||||||||||||||||
Balance Sheets | |||||||||||||||||
(In thousands) | |||||||||||||||||
% Change | |||||||||||||||||
December 31, | September 30, | December 31, | Last Three | Year Over | |||||||||||||
2016 | 2016 | 2015 | Months | Year | |||||||||||||
Assets | (Unaudited) | (Unaudited) | (Audited) | ||||||||||||||
Cash and due from banks | $ | 4,898 | $ | 7,610 | $ | 8,217 | -35.6 | % | -40.4 | % | |||||||
Interest-bearing deposits in banks | 49,717 | 31,067 | 46,738 | 60.0 | % | 6.4 | % | ||||||||||
Federal funds sold | 60 | - - | - - | n/a | n/a | ||||||||||||
Securities available-for-sale, at fair value | 48,312 | 48,397 | 32,145 | -0.2 | % | 50.3 | % | ||||||||||
Securities held-to-maturity, fair value of $44,067 at 12/31/2016, $46,443 at 9/30/2016 and $46,780 at 12/31/2015 | 44,073 | 45,292 | 46,479 | -2.7 | % | -5.2 | % | ||||||||||
Restricted securities, at cost | 7,873 | 6,959 | 6,210 | 13.1 | % | 26.8 | % | ||||||||||
Loans, net of allowance for loan losses of $8,202 at | |||||||||||||||||
12/31/2016; $7,799 at 9/30/2016 and $7,130 at 12/31/2015 | 886,220 | 845,681 | 774,633 | 4.8 | % | 14.4 | % | ||||||||||
Bank premises and equipment, net | 2,471 | 2,520 | 2,690 | -2.0 | % | -8.1 | % | ||||||||||
Accrued interest receivable | 2,988 | 2,527 | 2,318 | 18.2 | % | 28.9 | % | ||||||||||
Bank owned life insurance | 18,540 | 18,377 | - - | 0.9 | % | n/a | |||||||||||
Other assets | 10,014 | 9,047 | 9,190 | 10.7 | % | 9.0 | % | ||||||||||
Total assets | $ | 1,075,166 | $ | 1,017,477 | $ | 928,620 | 5.7 | % | 15.8 | % | |||||||
Liabilities and Shareholders' Equity | |||||||||||||||||
Liabilities | |||||||||||||||||
Deposits: | |||||||||||||||||
Non-interest bearing demand deposits | $ | 195,065 | $ | 162,899 | $ | 136,361 | 19.7 | % | 43.1 | % | |||||||
Interest bearing demand deposits | 211,495 | 236,504 | 235,313 | -10.6 | % | -10.1 | % | ||||||||||
Savings deposits | 6,856 | 6,038 | 17,154 | 13.6 | % | -60.0 | % | ||||||||||
Time deposits | 419,449 | 388,438 | 342,025 | 8.0 | % | 22.6 | % | ||||||||||
Total deposits | 832,865 | 793,878 | 730,853 | 4.9 | % | 14.0 | % | ||||||||||
Federal funds purchased | - - | 4,990 | - - | n/a | n/a | ||||||||||||
Repurchase agreements | 14,206 | 15,142 | 11,972 | -6.2 | % | 18.7 | % | ||||||||||
Federal Home Loan Bank advances | 104,000 | 83,000 | 71,000 | 25.3 | % | 46.5 | % | ||||||||||
Accrued interest payable | 220 | 210 | 109 | 5.0 | % | 101.8 | % | ||||||||||
Other liabilities | 5,080 | 4,043 | 5,384 | 25.6 | % | -5.6 | % | ||||||||||
Total liabilities | 956,371 | 901,263 | 819,318 | 6.1 | % | 16.7 | % | ||||||||||
Shareholders' Equity | |||||||||||||||||
Preferred stock, par value $5 per share; authorized 1,000,000 shares; none issued | - - | - - | - - | - - | - - | ||||||||||||
Common stock, nonvoting, par value $5 per share; authorized 1,000,000 shares; none issued | - - | - - | - - | - - | - - | ||||||||||||
Common stock, voting, par value $5 per share; authorized 20,000,000 shares; issued and outstanding, 10,137,149 shares at 12/31/2016, 10,129,147 at 9/30/2016, and 10,016,574 at 12/31/2015 | 50,686 | 50,646 | 50,083 | 0.1 | % | 1.2 | % | ||||||||||
Additional paid-in capital | 32,112 | 31,797 | 31,313 | 1.0 | % | 2.6 | % | ||||||||||
Retained earnings | 36,454 | 33,752 | 28,153 | 8.0 | % | 29.5 | % | ||||||||||
Accumulated other comprehensive income (loss) | (457 | ) | 19 | (247 | ) | -2445.9 | % | -85.0 | % | ||||||||
Total shareholders' equity | 118,795 | 116,214 | 109,302 | 2.2 | % | 8.7 | % | ||||||||||
Total liabilities and shareholders' equity | $ | 1,075,166 | $ | 1,017,477 | $ | 928,620 | 5.7 | % | 15.8 | % | |||||||
John Marshall Bank | ||||||||||||||||||
Statements of Income | ||||||||||||||||||
(Dollar amounts in thousands, except per share data) | ||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||
December 31, | December 31, | |||||||||||||||||
2016 | 2015 | % Change | 2016 | 2015 | % Change | |||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Audited) | |||||||||||||||
Interest and Dividend Income | ||||||||||||||||||
Interest and fees on loans | $ | 10,617 | $ | 9,684 | 9.6 | % | $ | 40,250 | $ | 37,145 | 8.4 | % | ||||||
Interest on investment securities, taxable | 398 | 321 | 24.0 | % | 1,433 | 1,280 | 12.0 | % | ||||||||||
Interest on investment securities, tax-exempt | 50 | 26 | 92.3 | % | 170 | 104 | 63.5 | % | ||||||||||
Dividends | 93 | 82 | 13.4 | % | 341 | 296 | 15.2 | % | ||||||||||
Interest on deposits in banks | 47 | 29 | 62.1 | % | 168 | 65 | 158.5 | % | ||||||||||
Total interest and dividend income | 11,205 | 10,142 | 10.5 | % | 42,362 | 38,890 | 8.9 | % | ||||||||||
Interest Expense | ||||||||||||||||||
Deposits | 1,407 | 1,254 | 12.2 | % | 5,411 | 4,572 | 18.4 | % | ||||||||||
Federal Home Loan Bank advances | 245 | 175 | 40.0 | % | 784 | 580 | 35.2 | % | ||||||||||
Other short-term borrowings | 12 | 12 | 0.0 | % | 60 | 61 | -1.6 | % | ||||||||||
Total interest expense | 1,664 | 1,441 | 15.5 | % | 6,255 | 5,213 | 20.0 | % | ||||||||||
Net interest income | 9,541 | 8,701 | 9.7 | % | 36,107 | 33,677 | 7.2 | % | ||||||||||
Provision for loan losses | 480 | 145 | 231.0 | % | 3,810 | 1,197 | 218.3 | % | ||||||||||
Net interest income after provision for loan losses | 9,061 | 8,556 | 5.9 | % | 32,297 | 32,480 | -0.6 | % | ||||||||||
Noninterest Income | ||||||||||||||||||
Service charges on deposit accounts | 94 | 113 | -16.8 | % | 401 | 482 | -16.8 | % | ||||||||||
Bank owned life insurance | 163 | - - | n/a | 540 | - - | n/a | ||||||||||||
Other service charges and fees | 29 | 15 | 93.3 | % | 82 | 68 | 20.6 | % | ||||||||||
Other operating income | - - | 29 | n/a | - - | 29 | n/a | ||||||||||||
Total noninterest income | 286 | 157 | 82.2 | % | 1,023 | 579 | 76.7 | % | ||||||||||
Noninterest Expenses | ||||||||||||||||||
Salaries and employee benefits | 3,344 | 2,865 | 16.7 | % | 12,548 | 11,421 | 9.9 | % | ||||||||||
Occupancy expense of premises | 417 | 437 | -4.6 | % | 1,678 | 1,781 | -5.8 | % | ||||||||||
Furniture and equipment expenses | 286 | 280 | 2.1 | % | 1,228 | 1,065 | 15.3 | % | ||||||||||
Other real estate owned expenses | - - | 198 | -100.0 | % | 1 | 247 | -99.6 | % | ||||||||||
Other operating expenses | 1,380 | 1,356 | 1.8 | % | 5,523 | 4,767 | 15.9 | % | ||||||||||
Total noninterest expenses | 5,427 | 5,136 | 5.7 | % | 20,978 | 19,281 | 8.8 | % | ||||||||||
Income before income taxes | 3,920 | 3,577 | 9.6 | % | 12,342 | 13,778 | -10.4 | % | ||||||||||
Income tax expense | 1,218 | 1,263 | -3.6 | % | 4,041 | 4,911 | -17.7 | % | ||||||||||
Net income | $ | 2,702 | $ | 2,314 | 16.8 | % | $ | 8,301 | $ | 8,867 | -6.4 | % | ||||||
Earnings Per Share | ||||||||||||||||||
Basic | $ | 0.27 | $ | 0.23 | 17.4 | % | $ | 0.82 | $ | 0.89 | -7.9 | % | ||||||
Diluted | $ | 0.25 | $ | 0.22 | 13.6 | % | $ | 0.79 | $ | 0.85 | -7.1 | % | ||||||
John Marshall Bank | |||||||||||||||||||||||||||
Loan, Deposit and Borrowing Detail (Unaudited) | |||||||||||||||||||||||||||
(Dollar amounts in thousands) | |||||||||||||||||||||||||||
December 31, 2016 | September 30, 2016 | December 31, 2015 | Percentage Change | ||||||||||||||||||||||||
Loans | $ Amount | % of Total | $ Amount | % of Total | $ Amount | % of Total | Last 3 Mos | Last 12 Mos | |||||||||||||||||||
Mortgage loans on real estate | |||||||||||||||||||||||||||
Commercial | $ | 519,857 | 58.0 | % | $ | 503,576 | 58.9 | % | $ | 441,309 | 56.3 | % | 3.2 | % | 17.8 | % | |||||||||||
Construction and land development | 180,318 | 20.1 | % | 173,867 | 20.3 | % | 150,786 | 19.3 | % | 3.7 | % | 19.6 | % | ||||||||||||||
Residential | 107,534 | 12.0 | % | 97,758 | 11.4 | % | 95,496 | 12.2 | % | 10.0 | % | 12.6 | % | ||||||||||||||
Total mortgage loans on real estate | $ | 807,709 | 90.1 | % | $ | 775,201 | 90.7 | % | $ | 687,591 | 87.8 | % | 4.2 | % | 17.5 | % | |||||||||||
Commercial loans | 86,498 | 9.7 | % | 78,120 | 9.1 | % | 94,371 | 12.0 | % | 10.7 | % | -8.3 | % | ||||||||||||||
Consumer loans | 1,820 | 0.2 | % | 1,655 | 0.2 | % | 1,203 | 0.2 | % | 10.0 | % | 51.3 | % | ||||||||||||||
Total loans | $ | 896,027 | 100.0 | % | $ | 854,976 | 100.0 | % | $ | 783,165 | 100.0 | % | 4.8 | % | 14.4 | % | |||||||||||
Less: Allowance for loan losses | (8,202 | ) | (7,799 | ) | (7,130 | ) | |||||||||||||||||||||
Net deferred loan fees | (1,605 | ) | (1,496 | ) | (1,402 | ) | |||||||||||||||||||||
Net loans | $ | 886,220 | $ | 845,681 | $ | 774,633 | |||||||||||||||||||||
December 31, 2016 | September 30, 2016 | December 31, 2015 | Percentage Change | ||||||||||||||||||||||||
Deposits | $ Amount | % of Total | $ Amount | % of Total | $ Amount | % of Total | Last 3 Mos | Last 12 Mos | |||||||||||||||||||
Noninterest-bearing demand deposits | $ | 195,065 | 23.4 | % | $ | 162,899 | 20.5 | % | $ | 136,361 | 18.7 | % | 19.7 | % | 43.1 | % | |||||||||||
Interest-bearing demand deposits: | |||||||||||||||||||||||||||
NOW accounts | 12,739 | 1.5 | % | 16,866 | 2.1 | % | 23,496 | 3.2 | % | -24.5 | % | -45.8 | % | ||||||||||||||
Money market accounts | 187,748 | 22.6 | % | 209,633 | 26.4 | % | 211,817 | 29.0 | % | -10.4 | % | -11.4 | % | ||||||||||||||
Savings accounts | 6,856 | 0.8 | % | 6,038 | 0.8 | % | 17,154 | 2.3 | % | 13.5 | % | -60.0 | % | ||||||||||||||
Certificates of deposit | |||||||||||||||||||||||||||
$250,000 or more | 187,568 | 22.5 | % | 162,552 | 20.5 | % | 137,381 | 18.8 | % | 15.4 | % | 36.5 | % | ||||||||||||||
Less than $250,000 | 101,368 | 12.2 | % | 102,406 | 12.9 | % | 94,164 | 12.9 | % | -1.0 | % | 7.7 | % | ||||||||||||||
QwickRate® Certificates of deposit | 22,844 | 2.8 | % | 21,104 | 2.7 | % | 25,018 | 3.4 | % | 8.2 | % | -8.7 | % | ||||||||||||||
CDARS® | 71,799 | 8.6 | % | 74,131 | 9.3 | % | 62,943 | 8.6 | % | -3.1 | % | 14.1 | % | ||||||||||||||
Brokered deposits | 46,878 | 5.6 | % | 38,249 | 4.8 | % | 22,519 | 3.1 | % | 22.6 | % | 108.2 | % | ||||||||||||||
Total deposits | $ | 832,865 | 100.0 | % | $ | 793,878 | 100.0 | % | $ | 730,853 | 100.0 | % | 4.9 | % | 14.0 | % | |||||||||||
Borrowings | |||||||||||||||||||||||||||
Federal funds purchased | $ | - | 0.0 | % | $ | 4,990 | 4.8 | % | $ | - | 0.0 | % | n/a | n/a | |||||||||||||
Customer repurchase agreements | 14,206 | 12.0 | % | 15,142 | 14.7 | % | 11,972 | 14.4 | % | -6.2 | % | 18.7 | % | ||||||||||||||
Federal Home Loan Bank advances | 104,000 | 88.0 | % | 83,000 | 80.5 | % | 71,000 | 85.6 | % | 25.3 | % | 46.5 | % | ||||||||||||||
Total borrowings | $ | 118,206 | 100.0 | % | $ | 103,132 | 100.0 | % | $ | 82,972 | 100.0 | % | 14.6 | % | 42.5 | % | |||||||||||
Total deposits and borrowings | $ | 951,071 | $ | 897,010 | $ | 813,825 | 6.0 | % | 16.9 | % | |||||||||||||||||
Core customer funding sources (1) | $ | 777,349 | 81.7 | % | $ | 749,667 | 83.6 | % | $ | 695,288 | 85.4 | % | 3.7 | % | 11.8 | % | |||||||||||
Wholesale funding sources (2) | 173,722 | 18.3 | % | 147,343 | 16.4 | % | 118,537 | 14.6 | % | 17.9 | % | 46.6 | % | ||||||||||||||
Total funding sources | $ | 951,071 | 100.0 | % | $ | 897,010 | 100.0 | % | $ | 813,825 | 100.0 | % | 6.0 | % | 16.9 | % | |||||||||||
(1) | Includes CDARS(r), which are all reciprocal deposits maintained by Bank customers, and repurchase agreements, which represent sweep accounts tied to customer operating accounts. | |
(2) | Consists of QwickRate(r) certificates of deposit, brokered deposits,Federal Home Loan Bank advances and Federal funds purchased | |
John Marshall Bank | ||||||||||||||||||
Average Balance Sheets, Interest and Rates (unaudited) | ||||||||||||||||||
(Dollar amounts in thousands) | ||||||||||||||||||
Three Months Ended December 31, 2016 | Three Months Ended December 31, 2015 | |||||||||||||||||
Interest | Average | Interest | Average | |||||||||||||||
Average | Income- | Yields | Average | Income- | Yields | |||||||||||||
Balance | Expense | /Rates | Balance | Expense | /Rates | |||||||||||||
Assets | ||||||||||||||||||
Securities | $ | 100,732 | $ | 541 | 2.14 | % | $ | 86,130 | $ | 429 | 1.98 | % | ||||||
Loans, net of unearned income | 871,311 | 10,617 | 4.85 | % | 775,132 | 9,684 | 4.96 | % | ||||||||||
Interest-bearing deposits in other banks | 35,099 | 47 | 0.53 | % | 29,288 | 29 | 0.39 | % | ||||||||||
Federal funds sold | 46 | - | 0.00 | % | - | - | 0.00 | % | ||||||||||
Total interest-earning assets | $ | 1,007,188 | $ | 11,205 | 4.43 | % | $ | 890,550 | $ | 10,142 | 4.52 | % | ||||||
Other assets | 31,887 | 13,826 | ||||||||||||||||
Total assets | $ | 1,039,075 | $ | 904,376 | ||||||||||||||
Liabilities & Shareholders' equity | ||||||||||||||||||
Interest-bearing deposits | ||||||||||||||||||
NOW accounts | $ | 13,353 | $ | 13 | 0.39 | % | $ | 16,500 | $ | 12 | 0.29 | % | ||||||
Money market accounts | 207,008 | 245 | 0.47 | % | 206,162 | 279 | 0.54 | % | ||||||||||
Savings accounts | 6,457 | 4 | 0.25 | % | 9,043 | 10 | 0.44 | % | ||||||||||
Time deposits | 408,648 | 1,145 | 1.11 | % | 338,159 | 953 | 1.12 | % | ||||||||||
Total interest-bearing deposits | $ | 635,466 | $ | 1,407 | 0.88 | % | $ | 569,864 | $ | 1,254 | 0.87 | % | ||||||
Securities sold under agreement to repurchase and federal funds purchased | $ | 13,644 | $ | 12 | 0.35 | % | $ | 12,391 | $ | 12 | 0.38 | % | ||||||
Other borrowed funds | 90,207 | 245 | 1.08 | % | 77,511 | 175 | 0.90 | % | ||||||||||
Total interest-bearing liabilities | $ | 739,317 | $ | 1,664 | 0.90 | % | $ | 659,766 | $ | 1,441 | 0.87 | % | ||||||
Demand deposits and other liabilities | 181,472 | 135,884 | ||||||||||||||||
Total liabilities | $ | 920,789 | $ | 795,650 | ||||||||||||||
Shareholders' equity | 118,286 | 108,726 | ||||||||||||||||
Total liabilities and shareholders' equity | $ | 1,039,075 | $ | 904,376 | ||||||||||||||
Interest rate spread | 3.53 | % | 3.65 | % | ||||||||||||||
Net interest income and margin | $ | 9,541 | 3.77 | % | $ | 8,701 | 3.88 | % | ||||||||||
Twelve Months Ended December 31, 2016 | Twelve Months Ended December 31, 2015 | |||||||||||||||||
Interest | Average | Interest | Average | |||||||||||||||
Average | Income- | Yields | Average | Income- | Yields | |||||||||||||
Balance | Expense | /Rates | Balance | Expense | /Rates | |||||||||||||
Assets | ||||||||||||||||||
Securities | $ | 94,518 | $ | 1,944 | 2.06 | % | $ | 83,171 | $ | 1,680 | 2.02 | % | ||||||
Loans, net of unearned income | 824,830 | 40,250 | 4.88 | % | 732,311 | 37,145 | 5.07 | % | ||||||||||
Interest-bearing deposits in other banks | 32,714 | 168 | 0.51 | % | 23,492 | 65 | 0.28 | % | ||||||||||
Federal funds sold | 16 | - | 0.00 | % | - | - | 0.00 | % | ||||||||||
Total interest-earning assets | $ | 952,078 | $ | 42,362 | 4.45 | % | $ | 838,974 | $ | 38,890 | 4.64 | % | ||||||
Other assets | 27,991 | 15,160 | ||||||||||||||||
Total assets | $ | 980,069 | $ | 854,134 | ||||||||||||||
Liabilities & Shareholders' equity | ||||||||||||||||||
Interest-bearing deposits | ||||||||||||||||||
NOW accounts | $ | 15,528 | $ | 61 | 0.39 | % | $ | 14,989 | $ | 43 | 0.29 | % | ||||||
Money market accounts | 213,766 | 1,081 | 0.51 | % | 201,563 | 1,075 | 0.53 | % | ||||||||||
Savings accounts | 9,671 | 40 | 0.41 | % | 7,163 | 26 | 0.36 | % | ||||||||||
Time deposits | 378,109 | 4,229 | 1.12 | % | 318,342 | 3,428 | 1.08 | % | ||||||||||
Total interest-bearing deposits | $ | 617,074 | $ | 5,411 | 0.88 | % | $ | 542,057 | $ | 4,572 | 0.84 | % | ||||||
Securities sold under agreement to repurchase and federal funds purchased | $ | 14,769 | $ | 60 | 0.41 | % | $ | 14,538 | $ | 61 | 0.42 | % | ||||||
Other borrowed funds | 75,995 | 784 | 1.03 | % | 62,096 | 580 | 0.93 | % | ||||||||||
Total interest-bearing liabilities | $ | 707,838 | $ | 6,255 | 0.88 | % | $ | 618,691 | $ | 5,213 | 0.84 | % | ||||||
Demand deposits and other liabilities | 158,032 | 130,441 | ||||||||||||||||
Total liabilities | $ | 865,870 | $ | 749,132 | ||||||||||||||
Shareholders' equity | 114,199 | 105,002 | ||||||||||||||||
Total liabilities and shareholders' equity | $ | 980,069 | $ | 854,134 | ||||||||||||||
Interest rate spread | 3.57 | % | 3.80 | % | ||||||||||||||
Net interest income and margin | $ | 36,107 | 3.79 | % | $ | 33,677 | 4.01 | % | ||||||||||
John Marshall Bank | ||||||||||||||||
Financial Highlights (Unaudited) | ||||||||||||||||
(Dollar amounts in thousands, except per share data) | ||||||||||||||||
At or For the Three Months Ended | At or For the Year Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Per share Data and Shares Outstanding | ||||||||||||||||
Earnings per share - basic | $ | 0.27 | $ | 0.23 | $ | 0.82 | $ | 0.89 | ||||||||
Earnings per share - diluted | $ | 0.25 | $ | 0.22 | $ | 0.79 | $ | 0.85 | ||||||||
Tangible book value per share | $ | 11.72 | $ | 10.91 | $ | 11.72 | $ | 10.91 | ||||||||
Weighted average common shares (basic) | 10,133,799 | 10,013,072 | 10,069,537 | 9,993,231 | ||||||||||||
Weighted average common shares (diluted) | 10,626,741 | 10,517,743 | 10,561,837 | 10,483,431 | ||||||||||||
Common shares outstanding at end of period | 10,137,149 | 10,016,574 | 10,137,149 | 10,016,574 | ||||||||||||
Performance Ratios | ||||||||||||||||
Return on average assets (annualized) | 1.03 | % | 1.02 | % | 0.85 | % | 1.04 | % | ||||||||
Return on average equity (annualized) | 9.09 | % | 8.44 | % | 7.27 | % | 8.44 | % | ||||||||
Yield on earning assets (annualized) | 4.43 | % | 4.52 | % | 4.45 | % | 4.64 | % | ||||||||
Cost of interest bearing liabilities (annualized) | 0.88 | % | 0.87 | % | 0.88 | % | 0.84 | % | ||||||||
Net interest spread | 3.53 | % | 3.65 | % | 3.57 | % | 3.80 | % | ||||||||
Net interest margin | 3.77 | % | 3.88 | % | 3.79 | % | 4.01 | % | ||||||||
Noninterest income as a percentage of average assets (annualized) | 0.11 | % | 0.07 | % | 0.10 | % | 0.07 | % | ||||||||
Noninterest expense to average assets (annualized) | 2.08 | % | 2.25 | % | 2.14 | % | 2.26 | % | ||||||||
Efficiency ratio | 55.2 | % | 58.0 | % | 56.5 | % | 56.3 | % | ||||||||
Asset Quality | ||||||||||||||||
Loans 30-89 days past due and accruing interest | $ | 1,008 | $ | - | $ | 1,008 | $ | - | ||||||||
Non-accrual loans | $ | 55 | $ | 2,957 | $ | 55 | $ | 2,957 | ||||||||
Other real estate owned | $ | - | $ | - | $ | - | $ | - | ||||||||
Non-performing assets (1) | $ | 55 | $ | 2,957 | $ | 55 | $ | 2,957 | ||||||||
Non-performing assets to total assets | 0.01 | % | 0.32 | % | 0.01 | % | 0.32 | % | ||||||||
Allowance for loan losses to total loans | 0.92 | % | 0.91 | % | 0.92 | % | 0.91 | % | ||||||||
Allowance for loan losses to non-performing loans | 149.1 | 2.4 | 149.1 | 2.4 | ||||||||||||
Net loan chargeoffs (recoveries) | $ | 77 | $ | (48 | ) | $ | 2,738 | $ | 573 | |||||||
Net charge-offs (recoveries) to average loans (annualized) | 0.04 | % | (0.2 | )% | 0.29 | % | 0.08 | % | ||||||||
Troubled debt restructurings (total) | $ | 508 | $ | 1,474 | $ | 508 | $ | 1,474 | ||||||||
Performing in accordance with modified terms | $ | 508 | $ | 1,474 | $ | 508 | $ | 1,474 | ||||||||
Not performing in accordance with modified terms | $ | - | $ | - | $ | - | $ | - | ||||||||
Regulatory Capital Ratios | ||||||||||||||||
Total risk-based capital ratio | 12.3 | % | 13.6 | % | 12.3 | % | 13.6 | % | ||||||||
Tier 1 risk-based capital ratio | 11.5 | % | 12.7 | % | 11.5 | % | 12.7 | % | ||||||||
Leverage ratio | 11.5 | % | 12.1 | % | 11.5 | % | 12.1 | % | ||||||||
Common equity tier 1 ratio | 11.5 | % | 12.7 | % | 11.5 | % | 12.7 | % | ||||||||
Other Information | ||||||||||||||||
Effective income tax rate | 31.1 | % | 35.3 | % | 32.7 | % | 35.6 | % | ||||||||
Tangible equity / tangible assets | 11.0 | % | 11.8 | % | 11.0 | % | 11.8 | % | ||||||||
Average tangible equity / average tangible assets | 11.4 | % | 12.0 | % | 11.7 | % | 12.3 | % | ||||||||
Number of full time equivalent employees | 111 | 106 | 111 | 106 | ||||||||||||
# Full service branch offices | 5 | 5 | 5 | 5 | ||||||||||||
# Loan production or limited service branch offices | 2 | 1 | 2 | 1 | ||||||||||||
(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. | |
View source version on businesswire.com: http://www.businesswire.com/news/home/20170125006300/en/