John Marshall Bancorp, Inc. Reports Record Earnings, 22% Asset Growth and Improved Efficiency

RESTON, Va.--()--John Marshall Bancorp, Inc. (OTCQB: JMSB) (the “Company”), parent company of John Marshall Bank (the “Bank”) reported its financial results for the three and six months ended June 30, 2019.

Selected Highlights

  • Record Quarterly and Year-to-Date Earnings - The Company reported net income of $3.8 million or $0.28 per diluted share for the three months ended June 30, 2019. This compares to $3.1 million or $0.23 per diluted share for the three months ended June 30, 2018. For the three months ended June 30, 2019, diluted earnings per share increased 21.7% when compared to the same period in 2018. The Company reported net income of $7.4 million or $0.54 per diluted share for the six months ended June 30, 2019. This compares to $6.3 million or $0.47 per diluted share for the six months ended June 30, 2018. Diluted earnings per share increased 14.9% for the six months ended June 30, 2019 compared to the six months ended June 30, 2018.
  • 3rd Consecutive Quarter of Increased Returns - The Company’s investment in personnel and locations during the first half of 2018 is producing increased returns. Annualized returns on average assets (“ROAA”) and returns on average equity (“ROAE”) have increased in each of the last three quarters. ROAA were 0.86%, 0.89%, 1.04% and 1.07% from the third quarter of 2018 to the second quarter of 2019, respectively. ROAE were 8.09%, 8.57%, 10.09%, and 10.19% from the third quarter of 2018 to the second quarter of 2019, respectively.
  • Improved Efficiency - Revenues (net interest income and noninterest income) were 12.8% greater in the second quarter of 2019 relative to the second quarter of 2018. Noninterest expense grew only 2.0% when comparing the same periods. This positive operating leverage enabled the efficiency ratio to decrease from 64.4% from the second quarter of 2018 to 58.2% for the second quarter of 2019. Noninterest expense to average assets declined from 2.27% for the three months ended June 30, 2018 to 2.03% for the three months ended June 30, 2019.
  • Strong Growth - Total assets exceeded $1.49 billion at June 30, 2019, an increase of $266.1 million or 21.7% since June 30, 2018. During the second quarter of 2019 assets increased $68.8 million, or 19.3% (annualized). Gross loans net of unearned income surpassed $1.24 billion at June 30, 2019. Gross loans net of unearned income increased $203.7 million or 19.6% since June 30, 2018. During the second quarter, gross loans net of unearned income grew $64.8 million or 22.1% (annualized). Total deposits topped $1.26 billion at June 30, 2019. Total deposits increased $288.9 million or 29.6% since June 30, 2018. During the second quarter, deposits grew $84.8 million or 28.9% (annualized).
  • Continued Improvement in Funding Composition - Non-interest bearing deposits grew $45.2 million or 41.0% (annualized) during the first six months of 2019 and represented 21.2% of total deposits at June 30, 2019. Core customer funding grew $226.1 million or 25.0% since June 30, 2018. Wholesale funding represented 12.9% of total funding sources at June 30, 2019 compared to 13.8% at December 31, 2018 and 14.5% at June 30, 2018.
  • Outstanding Asset Quality - Non-performing assets were 0.09% of total assets as June 30, 2019. The Company had no accruing loans 30 or more days past due and no real estate owned as of June 30, 2019. The Company experienced annualized net recoveries equal to 0.01% of average loans during the second quarter of 2019.

Chris Bergstrom, President and Chief Executive Officer, commented “Our talented team continues to work hard to enhance our products and services and enrich our customer experience. By leveraging our digital platform and managing costs, we delivered strong returns and above average growth. Risk management is central to all that we do. Our underwriting remains rigorous and our asset quality is strong. We have a liquid, well-capitalized balance sheet and believe we are well positioned for continued profitable growth.”

Balance Sheet Review

Assets

Total assets were $1.49 billion at June 30, 2019, $1.39 billion at December 31, 2018 and $1.23 billion at June 30, 2018. During the second quarter of 2019 assets increased $68.8 million, or 19.3% (annualized). Asset growth was $266.1 million, or 21.7%, from June 30, 2018 to June 30, 2019,

Loans

Gross loans were $1.24 billion at June 30, 2019, $1.16 billion at December 31, 2018 and $1.04 billion at June 30, 2018. During the second quarter, gross loans net of unearned income grew $64.8 million or 22.1% (annualized). Gross loans net of unearned income increased $203.7 million, or 19.6% from June 30, 2018 to June 30, 2019.

Investment Securities

The Company’s portfolio of investments in debt securities was $106.7 million at June 30, 2019, $97.2 million at December 31, 2018 and $95.6 million at June 30, 2018. Year-over-year the investment portfolio growth, from June 30, 2018 to June 30, 2019, was $11.1 million, or 11.6%. The Company also had restricted securities totaling $6.3 million at June 30, 2019, $7.3 million at December 31, 2018 and $8.1 million at June 30, 2018. The reduction in restricted securities stems from decreased FHLB advances.

In April 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. The Company elected to sell certain lower tax equivalent yield municipal bonds and reinvest the proceeds in higher yielding agency bonds with similar pre-payment protection features. The municipal bonds sold resulted in a net gain of $13 thousand.

Interest Bearing Deposits in Banks

Interest-bearing deposits in banks were $93.8 million at June 30, 2019, $93.7 million at December 31, 2018 and $54.6 million at June 30, 2018. The higher cash balances at June 30, 2019 continue to be a result of the recent deposit growth.

Deposits

Total deposits were $1.26 billion at June 30, 2019, $1.14 billion at December 31, 2018 and $974.4 million at June 30, 2018. During the second quarter, deposits grew $84.8 million or 28.9% (annualized). During the first six months, deposits grew $125.0 million, or 22.1% (annualized). Year-over-year deposit growth, from June 30, 2018 to June 30, 2019, was $288.9 million, or 29.6%. Core customer funding was $1.13 billion at June 30, 2019, $1.05 billion at December 31, 2018 and $906.0 million at June 30, 2018. Year-over-year core customer funding sources increased by $226.1 million, or 25.0%, from June 30, 2018 to June 30, 2019.

ICS deposits were $172.2 million at June 30, 2019, $135.1 million at December 31, 2018 and $81.1 million at June 30, 2018. Year-over-year, ICS deposits increased $91.2 million from June 30, 2018 to June 30, 2019. CDARS were $79.5 million at June 30, 2019, $112.2 million at December 31, 2018 and $98.1 million at June 30, 2018. Reciprocal deposit growth will fluctuate with customers’ preferences to receive fixed (CDARS) or floating (ICS) yields.

QwickRate certificates of deposit were $19.8 million at June 30, 2019, $20.6 million at December 31, 2018 and $25.5 million at June 30, 2018. Year-over-year QwickRate certificates of deposit decreased $5.7 million from June 30, 2018 to June 30, 2019. Brokered deposits were $111.5 million at June 30, 2019, $68.2 million at December 31, 2018 and $43.0 million at June 30, 2018. Brokered deposits increased $68.5 million from June 30, 2018 to June 30, 2019. The increase in brokered deposits is mostly related to a migration from FHLB borrowings to brokered deposits as part of liquidity management.

Core customer funding was 85.2% of all funding sources as of June 30, 2019, as compared to 84.2% at December 31, 2018 and 83.2% as of June 30, 2018. Increasing core customer funding continues to be a key strategic initiative for the Company.

Borrowings

Total borrowings, consisting of Federal Home Loan Bank advances and Federal funds purchased, were $40.5 million at June 30, 2019, $83.5 million at December 31, 2018 and $89.5 million at June 30, 2018. Total borrowings decreased $49.0 million, or 54.7%, from June 30, 2018 to June 30, 2019. Federal Home Loan Bank advances were $40.5 million at June 30, 2019, $68.5 million at December 31, 2018 and $89.5 million at June 30, 2018.

The Company had subordinated notes with a balance of $24.6 million at June 30, 2019, December 31, 2018 and June 30, 2018. The notes qualify as Tier 2 capital for the Company for regulatory purposes.

Shareholders’ Equity and Capital Levels

Total shareholders’ equity was $152.7 million at June 30, 2019, $142.0 million at December 31, 2018 and $135.0 million at June 30, 2018. Year-over-year shareholders’ equity increased by $17.7 million, or 13.1%. Total common shares outstanding increased from 12,871,125, including 86,125 unvested shares, at June 30, 2018, to 13,077,090, including 50,889 unvested shares, at June 30, 2019. The year-over-year increase in shares outstanding was primarily from the exercise of stock options and issuance of restricted stock.

The Company’s capital ratios remain well above regulatory minimums for well capitalized banks. As of June 30, 2019, the Company’s total risk-based capital ratio was 13.6%, compared to 14.9% at June 30, 2018.

Income Statement Review

Net Interest Income

Net interest income, the Company’s primary source of revenue, was $12.1 million for the three months ended June 30, 2019, up 12.5% from $10.8 million for the three months ended June 30, 2018. The net interest margin was 3.49% for the three months ended June 30, 2019 as compared to 3.52% for the three months ended June 30, 2018. Average net loans increased $184.8 million compared to the three months ended June 30, 2018, with a 26 basis point increase in yield. Average interest-bearing deposits in other banks declined $28.0 million compared to the three months ended June 30, 2018, with a 60 basis point increase in yield. The average cost of interest-bearing liabilities increased 59 basis points when comparing the quarter ended June 30, 2018 to the quarter ended June 30, 2019. Management continues to focus on increasing core transaction accounts to mitigate margin pressure.

For the six months ended June 30, 2019, net interest income was $23.7 million, up 11.8% from $21.2 million for the six months ended June 30, 2018. The net interest margin was 3.46% during the first six months of 2019, compared to 3.56% during the six months of 2018. Despite the decline in the net interest margin over the past year, net interest income increased by 11.8% during the first six months of 2019, compared to the first six months of 2018, resulting primarily from a $179.6 million, or 15.0%, increase in average earning assets during the first six months of 2019, compared to the first six months of 2018.

Provision for Loan Losses

The Company had a $384 thousand provision for loan losses for the three months ended June 30, 2019, compared to no provision for the same period in 2018. The Company had $23 thousand in net loan recoveries during the second quarter of 2019, compared to net loan charge-offs of $85 thousand in the second quarter of 2018.

During the six months ended June 30, 2019, the Company recognized a provision for loan losses of $605 thousand, compared to a provision of $190 during the first six months of 2018. The increase in provisions for both the three and six months ended June 30, 2019 is due to the growth in the loan portfolio. The Company reported $146 thousand in net loan charge-offs during the first six months of 2019, compared to $86 thousand in net loan charge-offs during the first six months of 2018. Net charge-offs to average loans was 0.02% (annualized) for both the first six months of 2018 and 2019.

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 June 30, 2019, the Company reported total noninterest income of $369 thousand, compared to $294 thousand during the three months ended June 30, 2018.

For the six months ended June 30, 2019, the Company reported total noninterest income of $676 thousand, compared to $628 thousand during the first six months of 2018, an increase of $48 thousand, or 7.6%.

The year-over-year increases for both the three and six months periods ended June 30, 2019 were attributable to an increase in service charges on deposit accounts of $37 thousand, or 31.9%, for the three months ended June 30, 2019 and $59 thousand, or 25.7% increase for the six months ended June 30, 2019 as compared to the same periods in the prior year. The increase in service charges on deposit accounts is mostly related to higher ATM and debit interchange fees collected. Noninterest income for the six month period 2019 included a $13 thousand net gain on sale of securities. The decline in other service charge fees is related to the fees collected on CDARs balances, which have declined year-over-year.

Noninterest Expense

For the three months ended June 30, 2019, noninterest expense increased 2.0%, to $7.3 million, compared to $7.1 million for the same period in 2018. Salary and employee benefit expense was $4.6 million during the three months ended June 30, 2019, relatively unchanged compared to the three months ended June 30, 2018. Occupancy expense increased 18.9%, or $90 thousand and furniture and equipment increased 7.7% or $25 thousand when comparing the three months ended June 30, 2019 to the same period in 2018. Other operating expense increased by 1.2%, or $21 thousand when comparing the three months ended June 30, 2019 to the same period in 2018.

For the six months ended June 30, 2019, noninterest expense increased 5.1% to $14.3 million, compared to $13.6 million for the same period in 2018. For the six months ended June 30, 2019 and June 30, 2018, salaries and employee benefits expense increased 5.4%, or $468 thousand. Occupancy expense increased 12.1%, or $119 thousand and furniture and equipment increased 9.3%, or $58 thousand when comparing the six months ended June 30, 2019 to the same period in 2018. Other operating expense increased by 1.4%, or $45 thousand, during the six months ended June 30, 2019, compared to the same period in 2018.

The increase in salaries and benefits for the six month period ended June 30, 2019 was primarily attributable to increased employee count year-over-year, including staff for our branches in Woodbridge, Virginia and Tysons Corner, Virginia. 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 increase in occupancy and furniture and equipment expenses for both the three and six month periods was mostly related to additional rent and furniture expenses related to the new locations listed above.

Asset Quality

As of June 30, 2019, non-performing assets were 0.09% of total assets, compared to 0.06% at June 30, 2018. As of June 30, 2019, non-accrual loans totaled $1.4 million, up $1.0 million from $390 thousand as of June 30, 2018. During the first quarter of 2019, loans totaling $1.4 million were added to non-accrual loans, which include three loans to one borrower, all of which are well secured. There were no accruing loans 30 or more days past due as of June 30, 2019.

At June 30, 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 June 30, 2019.

Troubled debt restructurings were $2.3 million at June 30, 2019, an increase of $1.8 million, compared to $488 thousand at June 30, 2018. During the first quarter of 2019, four loans totaling $1.6 million were added as troubled debt restructurings. There were $922 thousand of the troubled debt restructurings that were performing in accordance with their modified terms as of June 30, 2019. The $1.4 million troubled debt restructurings that were not performing in accordance with their modified terms are the non-performing loans mentioned above.

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 At or For the Six Months Ended
June 30, June 30,

2019

2018

2019

2018

Selected Balance Sheet Data
Cash and cash equivalents

$

10,802

 

$

5,482

 

 

10,802

 

 

5,482

 

Total investment securities

 

113,323

 

 

103,700

 

 

113,323

 

 

103,700

 

Loans net of unearned income

 

1,242,101

 

 

1,038,439

 

 

1,242,101

 

 

1,038,439

 

Allowance for loan losses

 

10,190

 

 

9,031

 

 

10,190

 

 

9,031

 

Total assets

 

1,494,231

 

 

1,228,135

 

 

1,494,231

 

 

1,228,135

 

Non-interest bearing demand deposits

 

267,475

 

 

206,098

 

 

267,475

 

 

206,098

 

Interest bearing deposits

 

995,885

 

 

768,342

 

 

995,885

 

 

768,342

 

Total deposits

 

1,263,360

 

 

974,440

 

 

1,263,360

 

 

974,440

 

Shareholders' equity

 

152,678

 

 

134,981

 

 

152,678

 

 

134,981

 

 
Summary Results of Operations
Interest income

$

17,079

 

$

13,836

 

$

33,456

 

$

27,117

 

Interest expense

 

4,979

 

 

3,077

 

 

9,777

 

 

5,930

 

Net interest income

 

12,100

 

 

10,759

 

 

23,679

 

 

21,187

 

Provision for loan losses

 

384

 

 

-

 

 

605

 

 

190

 

Net interest income after provision for loan losses

 

11,716

 

 

10,759

 

 

23,074

 

 

20,997

 

Noninterest income

 

369

 

 

294

 

 

676

 

 

628

 

Noninterest expense

 

7,260

 

 

7,118

 

 

14,293

 

 

13,603

 

Income before income taxes

 

4,825

 

 

3,935

 

 

9,457

 

 

8,022

 

Net income

 

3,809

 

 

3,100

 

 

7,419

 

 

6,344

 

 
Per share Data and Shares Outstanding
Earnings per share - basic

$

0.29

 

$

0.24

 

$

0.57

 

$

0.49

 

Earnings per share - diluted

$

0.28

 

$

0.23

 

$

0.54

 

$

0.47

 

Tangible book value per share

$

11.68

 

$

10.49

 

$

11.68

 

$

10.49

 

Weighted average common shares (basic)

 

12,983,455

 

 

12,777,343

 

 

12,947,351

 

 

12,771,488

 

Weighted average common shares (diluted)

 

13,561,915

 

 

13,537,089

 

 

13,555,967

 

 

13,524,384

 

Common shares outstanding at end of period

 

13,077,090

 

 

12,871,125

 

 

13,077,090

 

 

12,871,125

 

 
Performance Ratios
Return on average assets (annualized)

 

1.07

%

 

0.99

%

 

1.06

%

 

1.04

%

Return on average equity (annualized)

 

10.19

%

 

9.30

%

 

10.14

%

 

9.68

%

Net interest margin

 

3.49

%

 

3.52

%

 

3.46

%

 

3.56

%

Noninterest income as a percentage of average assets (annualized)

 

0.10

%

 

0.09

%

 

0.10

%

 

0.10

%

Noninterest expense to average assets (annualized)

 

2.03

%

 

2.27

%

 

2.03

%

 

2.23

%

Efficiency ratio

 

58.2

%

 

64.4

%

 

58.7

%

 

62.4

%

 
Asset Quality
Non-performing assets to total assets

 

0.09

%

 

0.06

%

 

0.09

%

 

0.06

%

Non-performing loans to total loans

 

0.11

%

 

0.87

%

 

0.11

%

 

0.87

%

Allowance for loan losses to non-performing loans

 

7.2

 

 

23.2

 

 

7.2

 

 

23.2

 

Allowance for loan losses to total loans

 

0.82

%

 

0.87

%

 

0.82

%

 

0.87

%

Net (recoveries) charge-offs to average loans (annualized)

 

(0.01

)%

 

0.03

%

 

0.02

%

 

0.02

%

 
Loans 30-89 days past due and accruing interest

$

- -

 

$

726

 

$

- -

 

$

726

 

Non-accrual loans

$

1,406

 

$

390

 

$

1,406

 

$

390

 

Other real estate owned

$

- -

 

$

379

 

$

- -

 

$

379

 

Non-performing assets (1)

$

1,406

 

$

769

 

$

1,406

 

$

769

 

Troubled debt restructurings (total)

$

2,328

 

$

488

 

$

2,328

 

$

488

 

Performing in accordance with modified terms

$

922

 

$

488

 

$

922

 

$

488

 

Not performing in accordance with modified terms

$

1,406

 

$

- -

 

$

1,406

 

$

- -

 

 
Capital Ratios
Tangible equity / tangible assets

 

10.2

%

 

10.2

%

 

10.2

%

 

10.2

%

Total risk-based capital ratio

 

13.6

%

 

14.9

%

 

13.6

%

 

14.9

%

Tier 1 risk-based capital ratio

 

11.1

%

 

12.0

%

 

11.1

%

 

12.0

%

Leverage ratio

 

10.7

%

 

10.8

%

 

10.7

%

 

10.8

%

Common equity tier 1 ratio

 

11.1

%

 

12.0

%

 

11.1

%

 

12.0

%

 
Other Information
Number of full time equivalent employees

 

142

 

 

133

 

 

142

 

 

133

 

# Full service branch offices

 

7

 

 

6

 

 

7

 

 

6

 

# Loan production or limited service branch offices

 

2

 

 

2

 

 

2

 

 

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

June 30,

 

December 31,

 

June 30,

 

Last Six

 

Year Over

2019

 

2018

 

2018

 

Months

 

Year

Assets

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

 

 

 
Cash and due from banks

$

 

10,802

 

$

 

7,853

 

$

 

5,482

 

37.6%

97.0%

Interest-bearing deposits in banks

 

93,770

 

 

93,716

 

 

54,593

 

0.1%

71.8%

Federal funds sold

 

84

 

 

126

 

 

76

 

-33.3%

10.5%

Securities available-for-sale, at fair value

 

106,659

 

 

61,055

 

 

55,654

 

74.7%

91.6%

Securities held-to-maturity, fair value of $35,550
at 12/31/2018 and $39,066 at 6/30/2018

 

- -

 

 

36,177

 

 

39,931

 

-100.0%

-100.0%

Restricted securities, at cost

 

6,304

 

 

7,283

 

 

8,115

 

-13.4%

-22.3%

Equity securities, at fair value

 

360

 

 

120

 

 

- -

 

200.0%

N/M

Loans net of unearned income

 

1,242,101

 

 

1,161,455

 

 

1,038,439

 

6.9%

19.6%

Allowance for loan losses

 

(10,190

)

 

(9,731

)

 

(9,031

)

4.7%

12.8%

Net loans

 

1,231,911

 

 

1,151,724

 

 

1,029,408

 

7.0%

19.7%

Bank premises and equipment, net

 

2,575

 

 

2,852

 

 

2,496

 

-9.7%

3.2%

Accrued interest receivable

 

4,133

 

 

3,623

 

 

3,282

 

14.1%

25.9%

Bank owned life insurance

 

19,867

 

 

19,617

 

 

19,353

 

1.3%

2.7%

Other real estate owned

 

- -

 

 

379

 

 

379

 

N/M

N/M

Right of use assets

 

8,861

 

 

- -

 

 

- -

 

N/M

N/M

Other assets

 

8,905

 

 

10,096

 

 

9,366

 

-11.8%

-4.9%

 
Total assets

$

 

1,494,231

 

$

 

1,394,621

 

$

 

1,228,135

 

7.1%

21.7%

 
Liabilities and Shareholders' Equity
 

Liabilities

Deposits:
Non-interest bearing demand deposits

$

 

267,475

 

$

 

222,299

 

$

 

206,098

 

20.3%

29.8%

Interest bearing demand deposits

 

418,606

 

 

367,656

 

 

288,918

 

13.9%

44.9%

Savings deposits

 

25,533

 

 

6,987

 

 

6,697

 

265.4%

281.3%

Time deposits

 

551,746

 

 

541,426

 

 

472,727

 

1.9%

16.7%

Total deposits

 

1,263,360

 

 

1,138,368

 

 

974,440

 

11.0%

29.6%

Federal funds purchased

 

- -

 

 

15,001

 

 

- -

 

N/M

N/M

Federal Home Loan Bank advances

 

40,500

 

 

68,500

 

 

89,500

 

-40.9%

-54.7%

Subordinated Debt

 

24,605

 

 

24,581

 

 

24,556

 

0.1%

0.2%

Accrued interest payable

 

1,202

 

 

1,243

 

 

1,149

 

-3.3%

4.6%

Lease liabilities

 

9,108

 

 

- -

 

 

- -

 

N/M

N/M

Other liabilities

 

2,778

 

 

4,910

 

 

3,509

 

-43.4%

-20.8%

Total liabilities

 

1,341,553

 

 

1,252,603

 

 

1,093,154

 

7.1%

22.7%

 
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, 13,077,090
at 6/30/2019 including 50,889 unvested shares, 12,900,125
shares at 12/31/2018 including 86,400 unvested shares
and 12,871,125 at 6/30/18, including 86,125 unvested shares

 

130

 

 

128

 

 

128

 

1.6%

1.6%

Additional paid-in capital

 

86,564

 

 

85,127

 

 

84,469

 

1.7%

2.5%

Retained earnings

 

65,138

 

 

57,718

 

 

51,774

 

12.9%

25.8%

Accumulated other comprehensive income (loss)

 

846

 

 

(955

)

 

(1,390

)

188.6%

160.9%

 
Total shareholders' equity

 

152,678

 

 

142,018

 

 

134,981

 

7.5%

13.1%

 
Total liabilities and shareholders' equity

$

 

1,494,231

 

$

 

1,394,621

 

$

 

1,228,135

 

7.1%

21.7%

John Marshall Bancorp, Inc.

Consolidated Statements of Income

 

(Dollar amounts in thousands, except per share data)

 

Three Months Ended

Six Months Ended

June 30,

June 30,

2019

2018

% Change

2019

2018

% Change

(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Interest and Dividend Income
Interest and fees on loans

$

 

15,848

$

 

12,733

24.5%

$

 

30,926

$

 

25,169

22.9%

Interest on investment securities, taxable

 

632

 

418

51.2%

 

1,161

 

832

39.5%

Interest on investment securities, tax-exempt

 

27

 

83

-67.5%

 

99

 

168

-41.1%

Dividends

 

111

 

128

-13.3%

 

227

 

242

-6.2%

Interest on federal funds sold

 

- -

 

- -

N/M

 

1

 

- -

N/M
Interest on deposits in banks

 

461

 

474

-2.7%

 

1,042

 

706

47.6%

Total interest and dividend income

 

17,079

 

13,836

23.4%

 

33,456

 

27,117

23.4%

 
Interest Expense
Deposits

 

4,353

 

2,343

85.8%

 

8,439

 

4,411

91.3%

Federal Home Loan Bank advances

 

254

 

363

-30.0%

 

592

 

774

-23.5%

Subordinated debt

 

372

 

371

0.3%

 

744

 

743

0.1%

Other short-term borrowings

 

- -

 

- -

N/M

 

2

 

2

0.0%

Total interest expense

 

4,979

 

3,077

61.8%

 

9,777

 

5,930

64.9%

 
Net interest income

 

12,100

 

10,759

12.5%

 

23,679

 

21,187

11.8%

 
Provision for loan losses

 

384

 

- -

N/M

 

605

 

190

218.4%

 
Net interest income after provision for loan losses

 

11,716

 

10,759

8.9%

 

23,074

 

20,997

9.9%

 
Noninterest Income
Service charges on deposit accounts

 

153

 

116

31.9%

 

289

 

230

25.7%

Bank owned life insurance

 

124

 

130

-4.6%

 

250

 

261

-4.2%

Other service charges and fees

 

40

 

41

-2.4%

 

83

 

122

-32.0%

Gain on sale of securities

 

13

 

- -

N/M

 

13

 

- -

N/M
Other operating income

 

39

 

7

457.1%

 

41

 

15

173.3%

Total noninterest income

 

369

 

294

25.5%

 

676

 

628

7.6%

 
Noninterest Expenses
Salaries and employee benefits

 

4,590

 

4,584

0.1%

 

9,200

 

8,732

5.4%

Occupancy expense of premises

 

566

 

476

18.9%

 

1,106

 

987

12.1%

Furniture and equipment expenses

 

348

 

323

7.7%

 

683

 

625

9.3%

Other operating expenses

 

1,756

 

1,735

1.2%

 

3,304

 

3,259

1.4%

Total noninterest expenses

 

7,260

 

7,118

2.0%

 

14,293

 

13,603

5.1%

 
Income before income taxes

 

4,825

 

3,935

22.6%

 

9,457

 

8,022

17.9%

 
Income tax expense

 

1,016

 

835

21.7%

 

2,038

 

1,678

21.5%

 
Net income

$

 

3,809

$

 

3,100

22.9%

$

 

7,419

$

 

6,344

16.9%

 
Earnings Per Share
Basic

$

 

0.29

$

 

0.24

20.8%

$

 

0.57

$

 

0.49

16.3%

Diluted

$

 

0.28

$

 

0.23

21.7%

$

 

0.54

$

 

0.47

14.9%

John Marshall Bancorp, Inc.
 
Loan, Deposit and Borrowing Detail (Unaudited)
(Dollar amounts in thousands)
 
June 30, 2019 December 31, 2018 June 30, 2018 Percentage Change

Loans

$ Amount % of Total $ Amount % of Total $ Amount % of Total Last 6 Mos Last 12 Mos
Mortgage loans on real estate
Commercial

$

764,132

61.4%

$

747,342

64.2%

$

648,004

62.3%

2.2%

17.9%

Construction and land development

 

240,224

19.3%

 

204,986

17.6%

 

199,787

19.2%

17.2%

20.2%

Residential

 

172,288

13.9%

 

143,811

12.4%

 

135,689

13.0%

19.8%

27.0%

Total mortgage loans on real estate

$

1,176,644

94.6%

$

1,096,139

94.2%

$

983,480

94.5%

7.3%

19.6%

Commercial loans

 

65,499

5.3%

 

65,815

5.7%

 

55,201

5.4%

-0.5%

18.7%

Consumer loans

 

991

0.1%

 

1,198

0.1%

 

1,524

0.1%

-17.3%

-35.0%

Total loans

$

1,243,134

100.0%

$

1,163,152

100.0%

$

1,040,205

100.0%

6.9%

19.5%

Less: Allowance for loan losses

 

(10,190)

 

(9,731)

 

(9,031)

Net deferred loan fees

 

(1,033)

 

(1,697)

 

(1,766)

Net loans

$

1,231,911

$

1,151,724

$

1,029,408

 
 
June 30, 2019 December 31, 2018 June 30, 2018 Percentage Change

Deposits

$ Amount % of Total $ Amount % of Total $ Amount % of Total Last 6 Mos Last 12 Mos
Noninterest-bearing demand deposits

$

267,475

21.2%

$

222,299

19.5%

$

206,098

21.2%

20.3%

29.8%

Interest-bearing demand deposits:
NOW accounts

 

58,892

4.7%

 

44,884

3.9%

 

37,205

3.8%

31.2%

58.3%

Money market accounts

 

187,474

14.8%

 

186,626

16.4%

 

170,643

17.5%

0.5%

9.9%

Savings accounts

 

25,533

2.0%

 

6,987

0.6%

 

6,697

0.7%

265.4%

281.3%

Certificates of deposit
$250,000 or more

 

220,672

17.5%

 

232,491

20.4%

 

195,830

20.1%

-5.1%

12.7%

Less than $250,000

 

120,280

9.5%

 

108,911

9.6%

 

110,357

11.3%

10.4%

9.0%

QwickRate® Certificates of deposit

 

19,784

1.6%

 

20,642

1.8%

 

25,471

2.6%

-4.2%

-22.3%

ICS®

 

172,238

13.6%

 

135,135

11.9%

 

81,071

8.3%

27.5%

112.5%

CDARS®

 

79,512

6.3%

 

112,196

9.9%

 

98,089

10.1%

-29.1%

-18.9%

Brokered deposits

 

111,500

8.8%

 

68,197

6.0%

 

42,979

4.4%

63.5%

159.4%

Total deposits

$

1,263,360

100.0%

$

1,138,368

100.0%

$

974,440

100.0%

11.0%

29.6%

 

Borrowings

Federal funds purchased

$

- -

N/M

$

15,001

13.9%

$

- -

N/M

N/M

N/M

Federal Home Loan Bank advances

 

40,500

62.2%

 

68,500

63.4%

 

89,500

78.5%

-40.9%

-54.7%

Subordinated debt

 

24,605

37.8%

 

24,581

22.7%

 

24,556

21.5%

0.1%

0.2%

Total borrowings

$

65,105

100.0%

$

108,082

100.0%

$

114,056

100.0%

-39.8%

-42.9%

 
Total deposits and borrowings

$

1,328,465

$

1,246,450

$

1,088,496

6.6%

22.0%

 
Core customer funding sources (1)

$

1,132,076

85.2%

$

1,049,529

84.2%

$

905,990

83.2%

7.9%

25.0%

Wholesale funding sources (2)

 

171,784

12.9%

 

172,340

13.8%

 

157,950

14.5%

-0.3%

8.8%

Subordinated debt (3)

 

24,605

1.9%

 

24,581

2.0%

 

24,556

2.3%

0.1%

0.2%

Total funding sources

$

1,328,465

100.0%

$

1,246,450

100.0%

$

1,088,496

100.0%

6.6%

22.0%

(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.

Contacts

Chris Bergstrom
(703) 584-0840

Contacts

Chris Bergstrom
(703) 584-0840