Financial News

John Marshall Bancorp, Inc. Reports 27.3% Earnings per Share Growth Driven by Strong Loan Growth, Expense Management and Outstanding Asset Quality

John Marshall Bancorp, Inc. (Nasdaq: JMSB) (the “Company”), parent company of John Marshall Bank (the “Bank”), today reported net income of $7.9 million ($0.56 per diluted common share) for the quarter ended June 30, 2022. The current quarter’s result compares to net income of $6.1 million ($0.44 per diluted common share) for the second quarter of 2021 and net income of $7.7 million ($0.55 per diluted common share) for the first quarter of 2022.

Second Quarter Highlights

  • Fourteenth Consecutive Quarter of Record Earnings – The Company reported record net income of $7.9 million for the second quarter of 2022, a $1.8 million or 29.7% increase over the $6.1 million reported for the second quarter of 2021. Earnings per diluted share for the three months ended June 30, 2022 were $0.56, a 27.3% increase over the $0.44 reported for the three months ended June 30, 2021.
  • Record Returns – Annualized Return on Average Assets (“ROAA”) was 1.41% and annualized Return on Average Equity (“ROAE”) was 15.28% for the three months ended June 30, 2022. ROAA and ROAE were 1.20% and 12.64%, respectively, for the three months ended June 30, 2021. Excluding the second quarter of 2010, when the Company realized a significant, non-recurring income tax benefit from the removal of the valuation allowance on its deferred tax assets, the ROAA and ROAE represent Company records.
  • Strong Loan Growth – Excluding Paycheck Protection Program (“PPP”) loans, gross loans net of unearned income (“Core Loans”) grew $204.1 million or 13.7% from June 30, 2021 to June 30, 2022. Core loans grew $68.8 million or 17.0% annualized from March 31, 2022 to June 30, 2022, representing the 3rd best quarter of core loan production in the Company’s history.
  • Overhead Discipline – The Company continues to actively manage costs while investing for future growth. The efficiency ratio for the second quarter of 2022 was 44.1% compared to 53.6% for the second quarter of 2021. The ratio of annualized non-interest expense to average assets was 1.38% for the second quarter of 2022 and 1.79% for the second quarter of 2021.
  • Asset Quality Remains Pristine – For the eleventh consecutive quarter, the Company had no non-performing loans, no loans 30 days or more past due, and no other real estate owned assets at June 30, 2022. The Company believes its allowance for loan losses is appropriate for the inherent risks and uncertainties associated with the portfolio.

Chris Bergstrom, President and Chief Executive Officer, commented, “During the second quarter of 2022, the Company achieved a number of significant milestones – registering our stock with the Securities and Exchange Commission to provide shareholders with greater disclosure and transparency, listing on the Nasdaq to facilitate greater trading volume, paying a cash dividend to reward our shareholders and refinancing our subordinated debt to lower our interest expense and cost of capital. While working on these priorities, we were able to achieve our 3rd best quarter of core loan growth. The PPP loan payoffs that we have not yet redeployed into loans were invested into liquid, cash flowing securities that we expect to convert into future loans and further increase our profitability. Our balance sheet remains well-capitalized with stellar asset quality, ample liquidity, and is primed for continued growth.”

Balance Sheet and Credit Quality

Total assets were $2.32 billion at June 30, 2022, $2.25 billion at March 31, 2022 and $2.07 billion at June 30, 2021. Asset growth from June 30, 2021 to June 30, 2022 was $250.5 million or 12.1%. During the second quarter of 2022, assets increased $66.8 million or 11.9% annualized. Asset growth was primarily comprised of loans and securities available for sale.

Total loans, net of unearned income, increased by 8.0% to $1.69 billion at June 30, 2022, compared to $1.57 billion at June 30, 2021. Excluding PPP loans, total loans, net of unearned income, at June 30, 2022 grew 13.7% to $1.69 billion as compared to $1.49 billion at June 30, 2021. The year-over-year increase in the loan portfolio is primarily attributable to growth in the investor real estate, residential mortgage, commercial owner-occupied real estate, and multi-family loan portfolios. At June 30, 2022, PPP loans, net of unearned income, totaled $216 thousand.

Total loans, net of unearned income, increased $61.4 million during the quarter ended June 30, 2022 or 15.1% annualized from $1.63 billion at March 31, 2022. Excluding PPP loans, total loans, net of unearned income, increased $68.8 million during the quarter ended June 30, 2022 or 17.0% annualized from March 31, 2022. The increase in loans was attributable to growth in the investor real estate, commercial owner-occupied, residential mortgage, and multi-family loan portfolios.

The Company’s portfolio of investments in fixed income securities was $467.4 million at June 30, 2022, $402.3 million at March 31, 2022, and $299.5 million at June 30, 2021. The increase in the fixed income securities portfolio was primarily driven by redeployment of PPP loan payoffs and deposit growth. All but $15.2 million of the fixed income portfolio is backed by the explicit or implicit guarantees of the United States Government or one of its agencies.

Total deposits were $2.04 billion at June 30, 2022, $1.98 billion at March 31, 2022 and $1.82 billion at June 30, 2021. Deposit growth was 12.6% during the past twelve months, as saving deposits grew 41.9%, interest-bearing demand deposits grew 25.6%, and non-interest bearing deposits grew 7.0%. Deposit growth was 8.6% during the past six months as interest-bearing demand deposits grew 16.5% and savings deposits grew 10.8%.

Total borrowings, defined as Federal Home Loan Bank (“FHLB”) advances and subordinated debt, increased by 15.7% or $6.8 million to $49.6 million at June 30, 2022 compared to $42.8 million at March 31, 2022. The increase was primarily due to the Company’s June 2022 issuance of a 5.25% fixed-to-floating rate subordinated note (“2022 note”) due in 2032 in the principal amount of $25.0 million. On July 15, 2022, the Company used the proceeds from the issuance to redeem the 5.75% fixed-to-floating rate subordinated notes (“2017 notes”) due 2027. The increase in total borrowings was partially offset by an $18.0 million decrease in FHLB advances due to the call of the Company’s outstanding FHLB advances during the three months ended June 30, 2022.

Shareholders’ equity was $207.5 million at June 30, 2022, an increase of $12.3 million or 6.3% from June 30, 2021. This increase year-over-year was due to net income of $29.9 million and the exercise of stock options totaling $3.5 million, partially offset by reductions in accumulated other comprehensive income of $18.3 million and dividends paid of $2.8 million. Book value per share was $14.80 as of June 30, 2022 compared to $14.32 as of June 30, 2021. The change in book value per share year-over-year was due to earnings, partially offset by increases in unrealized losses on our available-for-sale investment portfolio as a result of rising interest rates, shareholder option exercises, restricted share award issuances, and dividends paid. The Bank’s capital ratios remain well above regulatory thresholds for well-capitalized banks. As of June 30, 2022, the Bank’s total risk-based capital ratio was 15.1%, compared to 15.0% at June 30, 2021.

The Company recorded no net charge-offs for the second quarter of 2022, as compared to net charge-offs of $1 thousand during the first quarter of 2022 and $90 thousand during the second quarter of 2021. As of June 30, 2022, the Company had no non-accrual loans, no loans 30 days or more past due and no other real estate owned assets.

At June 30, 2022, the allowance for loan losses was $20.0 million or 1.18% of outstanding loans, net of unearned income, compared to $20.0 million or 1.23% of outstanding loans, net of unearned income, at March 31, 2022. The decrease in the allowance to outstanding loans, net of unearned income, was primarily due to improvement in risk ratings and the net changes in other qualitative adjustments.

Income Statement Review

Quarterly Results

Net income for the second quarter of 2022 increased $1.8 million or 29.7% to $7.9 million compared to $6.1 million for the second quarter of 2021. Net income increased $208 thousand or 2.7% compared to $7.7 million for the first quarter of 2022.

Net interest income for the second quarter of 2022 increased $817 thousand or 5.5% compared to the second quarter of 2021, driven primarily by growth in the Company’s investment portfolio. The annualized net interest margin excluding the effects of accelerated amortization on the 2017 notes and interest expense on 2022 note (non-GAAP) for the second quarter of 2022 was 3.18% as compared to 3.31% for the same quarter of the prior year. The tax-equivalent yield on interest earning assets was 3.57% for the second quarter of 2022 compared to 3.75% for the same period in 2021. The year-over-year decrease in net interest margin and tax-equivalent yield on interest earning assets was primarily due to lower yields on the Company’s loan portfolio. The non-GAAP cost of interest-bearing liabilities was 0.56% for the second quarter of 2022 compared to 0.62% for the same quarter of the prior year. The decrease in the cost of interest-bearing liabilities was primarily due to a six basis point reduction in the cost of interest-bearing deposits as a result of the repricing of the Company’s time deposits. Refer to “Explanation of Non-GAAP Measures” and the “Reconciliation of Certain Non-GAAP Financial Measures” table for further details about financial measures used in this release that were determined by methods other than in accordance with United States generally accepted accounting principles (“GAAP”).

The Company did not record a provision for loan losses for the second quarter of 2022, compared to a $90 thousand provision for the second quarter of 2021. The provision recorded during the second quarter of 2021 related to a charge-off for a loan that the Bank sold as part of a portfolio management strategy.

Non-interest income decreased $308 thousand or 73.9% during the second quarter of 2022 compared to the second quarter of 2021. The decrease in non-interest income was primarily due to mark-to-market adjustments of $(339) thousand resulting from a reduction in value of investments related to the Company’s nonqualified deferred compensation plan. Excluding the impact of the mark-to-market adjustments, non-interest income increased $31 thousand or 8.9% primarily due to increases in service charges and fees on deposit accounts, interchange and other fee income, and insurance commissions.

Non-interest expense decreased $1.4 million or 15.3% for the three months ended June 30, 2022 compared to the three months ended June 30, 2021. The decrease in non-interest expense was primarily due to a decrease in salaries and employee benefits of $1.0 million or 18.0% driven primarily by a decrease in incentive compensation accruals. Incentive compensation accruals can fluctuate materially from quarter to quarter, based upon the Company’s financial performance and conditions measured against, among other evaluation criteria, our strategic plan and budget. At the end of each year, the ultimate determination of the incentive compensation is approved by the Board of Directors.

For the three months ended June 30, 2022, annualized non-interest expense to average assets was 1.38% compared to 1.79% for the three months ended June 30, 2021. The decrease was primarily due to lower incentive compensation accruals and non-recurring legal and professional fees incurred in 2021, coupled with continued cost consciousness.

For the three months ended June 30, 2022, the annualized efficiency ratio was 44.1% compared to 53.6% for the three months ended June 30, 2021. The decrease was primarily due to the increase in net interest income coupled with a decrease in incentive compensation accruals.

Year-to-Date Results

Net income for the six months ended June 30, 2022 increased $4.4 million or 39.5% to $15.6 million compared to $11.2 million for the six months ended June 30, 2021. The results for the six months ended June 30, 2022 reflect a combination of the impact of an increase in net interest income, a decrease in provision for loan loss expense, and a decrease in non-interest expense, which were partially offset by a decrease in non-interest income.

Net interest income for the six months ended June 30, 2022 increased $2.5 million or 7.5% compared to the six months ended June 30, 2021 and was driven primarily by growth in the Company’s loan and investment portfolios. The annualized non-GAAP net interest margin for the six months ended June 30, 2022 was 3.26% as compared to 3.37% for the same period of the prior year. The tax-equivalent yield on interest earning assets for the six months ended June 30, 2022 was 3.62% compared to 3.86% for the same period in the prior year. The year-over-year decrease in net interest margin and tax-equivalent yield on interest earning assets was primarily due to a lower yield on fixed rate investments and lower yields on the Company’s loan portfolio. The non-GAAP cost of interest-bearing liabilities was 0.51% for the six months ended June 30, 2022 compared to 0.68% for the same period of the prior year. The decrease in the cost of interest-bearing liabilities was primarily due to a 16 basis point reduction in the cost of interest-bearing deposits as a result of the repricing of the Company’s time deposits.

The Company did not record a provision for loan losses for the six months ended June 30, 2022, compared to a $2.5 million provision for the six months ended June 30, 2021. The decrease in the provision for loan losses as compared to the same period in 2021 primarily reflects changes in the Company’s evaluation of environmental factors impacting the Company’s loan portfolio during 2022. During 2021, the environmental or qualitative factor allocations within the allowance for loan losses were adjusted to account for the risks to certain industry subgroups and portfolio segments within our portfolio as a result of the continuing COVID-19 pandemic. The decrease in the provision for loan losses primarily reflects an estimated decrease in uncertainty as it relates to the estimated impact of the COVID-19 pandemic on the Company’s loan portfolio and the broader economy.

Non-interest income decreased $358 thousand or 40.6% during the six months ended June 30, 2022 compared to the six months ended June 30, 2021. The decrease in non-interest income was primarily due to mark-to-market adjustments of $(490) thousand resulting from a reduction in value of investments related to the Company’s nonqualified deferred compensation plan. Additionally, during the six months ended June 30, 2021, the Company realized a $10 thousand gain on the call of a security. Excluding the impacts of the mark-to-market adjustments and gain on call, non-interest income increased $142 thousand or 18.4% primarily due to increases in insurance commissions, service charges and fees on deposit accounts, and interchange and other fee income.

Non-interest expense decreased $493 thousand or 2.9% during the six months ended June 30, 2022 compared to the six months ended June 30, 2021. The decrease in non-interest expense was primarily due to non-recurring legal and professional fees incurred in 2021 and decreases in FDIC insurance fees due to lower insurance premiums. These decreases were partially offset by an increase in state franchise taxes as a result of an increase in the Bank’s equity year-over-year.

For the six months ended June 30, 2022, annualized non-interest expense to average assets was 1.49% compared to 1.72% for the six months ended June 30, 2021. The decrease was primarily due to non-recurring legal and professional fees incurred in 2021, coupled with continued cost consciousness.

For the six months ended June 30, 2022, the annualized efficiency ratio was 46.1% compared to 50.4% for the six months ended June 30, 2021. The decrease was primarily due to the increase in net interest income coupled with a decrease in other expenses. The increase was partially offset by a decrease in non-interest income.

Explanation of Non-GAAP Financial Measures

This release contains financial information and performance measures determined by methods other than in accordance with GAAP. Management believes that the supplemental non-GAAP information provides a better comparison of period-to-period operating performance. Additionally, the Company believes this information is utilized by regulators and market analysts to evaluate a company’s financial condition and therefore, such information is useful to investors. Non-GAAP measures used in this release consist of the following:

  • Cost of interest-bearing liabilities that excludes the effects of accelerated amortization of debt costs associated with the Company’s 2017 notes and interest expense associated with the Company’s 2022 note. On July 15, 2022, the Company used the proceeds from the 2022 note to redeem the 2017 notes.
  • Net interest margin that excludes the effects of accelerated amortization of debt costs associated with the Company’s 2017 notes, and interest expense associated with the Company’s 2022 note.

These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Please refer to the Reconciliation of Certain Non-GAAP Financial Measures table for a reconciliation of these non-GAAP measures to the most directly comparable GAAP measure.

About John Marshall Bancorp, Inc.

John Marshall Bancorp, Inc. is the bank holding company for John Marshall Bank. The Bank is a $2.32 billion bank headquartered in Reston, Virginia with eight full-service branches located in Alexandria, Arlington, Loudoun, Prince William, Reston, and Tysons, Virginia, as well as Rockville, Maryland, and Washington, D.C. with one loan production office in Arlington, Virginia. The Bank is dedicated to providing exceptional value, personalized service and convenience to local businesses and professionals in the Washington D.C. Metro area. The Bank offers a comprehensive line of sophisticated banking products and services that rival those of the largest banks along with experienced staff to help achieve customers’ financial goals. Dedicated Relationship Managers serve as direct points-of-contact, providing subject matter expertise in a variety of niche industries including Charter and Private Schools, Government Contractors, Health Services, Nonprofits and Associations, Professional Services, Property Management Companies, and Title Companies. Learn more at www.johnmarshallbank.com.

In addition to historical information, this press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on certain assumptions and describe future plans, strategies and expectations of the Company. These forward-looking statements are generally identified by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” “will,” “should,” “may,” “view,” “opportunity,” “potential,” or similar expressions or expressions of confidence. The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations of the Company and its subsidiary include, but are not limited to the following: changes in interest rates, general economic conditions, public health crises (such as the governmental, social and economic effects of COVID-19), levels of unemployment in the Bank’s lending area, real estate market values in the Bank’s lending area, future natural disasters, the level of prepayments on loans and mortgage-backed securities, legislative/regulatory changes, monetary and fiscal policies of the U.S. Government including policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System, the quality or composition of the loan or investment portfolios, demand for loan products, deposit flows, competition, demand for financial services in the Company’s market area, accounting principles and guidelines, and other conditions which by their nature are not susceptible to accurate forecast, and are subject to significant uncertainty. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events. Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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,

 

 

 

2022

 

2021

 

2022

 

2021

 

Selected Balance Sheet Data

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

120,887

 

$

168,004

 

$

120,887

 

$

168,004

 

Total investment securities

 

 

473,914

 

 

306,030

 

 

473,914

 

 

306,030

 

Loans, net of unearned income

 

 

1,692,652

 

 

1,567,112

 

 

1,692,652

 

 

1,567,112

 

Allowance for loan losses

 

 

20,031

 

 

19,381

 

 

20,031

 

 

19,381

 

Total assets

 

 

2,316,374

 

 

2,065,895

 

 

2,316,374

 

 

2,065,895

 

Non-interest bearing demand deposits

 

 

512,284

 

 

478,705

 

 

512,284

 

 

478,705

 

Interest bearing deposits

 

 

1,531,457

 

 

1,336,327

 

 

1,531,457

 

 

1,336,327

 

Total deposits

 

 

2,043,741

 

 

1,815,032

 

 

2,043,741

 

 

1,815,032

 

Shareholders' equity

 

 

207,530

 

 

195,246

 

 

207,530

 

 

195,246

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary Results of Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

19,555

 

$

18,627

 

$

39,300

 

$

37,374

 

Interest expense

 

 

2,247

 

 

2,136

 

 

4,076

 

 

4,601

 

Net interest income

 

 

17,308

 

 

16,491

 

 

35,224

 

 

32,773

 

Provision for loan losses

 

 

- -

 

 

90

 

 

- -

 

 

2,455

 

Net interest income after provision for loan losses

 

 

17,308

 

 

16,401

 

 

35,224

 

 

30,318

 

Non-interest income

 

 

109

 

 

417

 

 

523

 

 

881

 

Non-interest expense

 

 

7,681

 

 

9,067

 

 

16,467

 

 

16,960

 

Income before income taxes

 

 

9,736

 

 

7,751

 

 

19,280

 

 

14,239

 

Net income

 

 

7,882

 

 

6,079

 

 

15,556

 

 

11,153

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Share Data and Shares Outstanding

 

 

 

 

Earnings per share - basic

 

$

0.56

 

$

0.45

 

$

1.11

 

$

0.82

 

Earnings per share - diluted

 

$

0.56

 

$

0.44

 

$

1.10

 

$

0.80

 

Book value per share

 

$

14.80

 

$

14.32

 

$

14.80

 

$

14.32

 

Weighted average common shares (basic)

 

 

13,932,256

 

 

13,572,779

 

 

13,858,057

 

 

13,565,320

 

Weighted average common shares (diluted)

 

 

14,085,160

 

 

13,868,173

 

 

14,042,205

 

 

13,852,936

 

Common shares outstanding at end of period

 

 

14,026,589

 

 

13,639,173

 

 

14,026,589

 

 

13,639,173

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performance Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets (annualized)

 

 

1.41

%

 

1.20

%

 

1.41

%

 

1.13

%

Return on average equity (annualized)

 

 

15.28

%

 

12.64

%

 

15.02

%

 

11.78

%

Net interest margin

 

 

3.16

%

 

3.31

%

 

3.25

%

 

3.37

%

Non-interest income as a percentage of average assets (annualized)

 

 

0.02

%

 

0.08

%

 

0.05

%

 

0.09

%

Non-interest expense to average assets (annualized)

 

 

1.38

%

 

1.79

%

 

1.49

%

 

1.72

%

Efficiency ratio

 

 

44.1

%

 

53.6

%

 

46.1

%

 

50.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset Quality

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing assets to total assets

 

 

- -

%

 

- -

%

 

- -

%

 

- -

%

Non-performing loans to total loans

 

 

- -

%

 

- -

%

 

- -

%

 

- -

%

Allowance for loan losses to non-performing loans

 

 

N/M

 

 

N/M

 

 

N/M

 

 

N/M

 

Allowance for loan losses to total loans (1)

 

 

1.18

%

 

1.24

%

 

1.18

%

 

1.24

%

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

 

 

- -

%

 

0.02

%

 

0.00

%

 

0.01

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans 30-89 days past due and accruing interest

 

$

- -

 

$

- -

 

$

- -

 

$

- -

 

Non-accrual loans

 

 

- -

 

 

- -

 

 

- -

 

 

- -

 

Other real estate owned

 

 

- -

 

 

- -

 

 

- -

 

 

- -

 

Non-performing assets (2)

 

 

- -

 

 

- -

 

 

- -

 

 

- -

 

Troubled debt restructurings (total)

 

 

536

 

 

473

 

 

536

 

 

473

 

Performing in accordance with modified terms

 

 

536

 

 

473

 

 

536

 

 

473

 

Not performing in accordance with modified terms

 

 

- -

 

 

- -

 

 

- -

 

 

- -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Ratios (Bank Level)

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity / assets

 

 

9.9

%

 

9.5

%

 

9.9

%

 

9.5

%

Total risk-based capital ratio

 

 

15.1

%

 

15.0

%

 

15.1

%

 

15.0

%

Tier 1 risk-based capital ratio

 

 

14.0

%

 

13.9

%

 

14.0

%

 

13.9

%

Leverage ratio

 

 

11.0

%

 

10.7

%

 

11.0

%

 

10.7

%

Common equity tier 1 ratio

 

 

14.0

%

 

12.3

%

 

14.0

%

 

12.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Information

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of full time equivalent employees

 

 

144

 

 

143

 

 

144

 

 

143

 

# Full service branch offices

 

 

8

 

 

8

 

 

8

 

 

8

 

# Loan production or limited service branch offices

 

 

1

 

 

1

 

 

1

 

 

1

 

(1)

The allowance for loan losses to total loans, excluding PPP loans, net of unearned income, of $216 thousand, was 1.18% at June 30, 2022. The allowance for loan losses to total loans, excluding PPP loans, net of unearned income, of $79.9 million, was 1.30% at June 30, 2021. PPP loans received no allocations in the allowance estimate due to the underlying guarantees.

(2)

Non-performing assets consist of non-accrual loans, loans 90 days or more past due and still accruing interest, and other real estate owned. Does not include troubled debt restructurings 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

 

 

2022

 

2021

2021

 

Months

Year

Assets

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

 

 

 

 

Cash and due from banks

 

$

12,915

 

$

2,920

 

$

9,341

 

342.3

%

38.3

%

Interest-bearing deposits in banks

 

 

107,972

 

 

102,879

 

 

158,663

 

5.0

%

(31.9)

%

Securities available-for-sale, at fair value

 

 

365,134

 

 

239,300

 

 

299,485

 

52.6

%

21.9

%

Securities held-to-maturity, fair value of $88,862 and $103,258 at 6/30/2022 and 12/31/2021, respectively.

 

 

102,265

 

 

105,509

 

 

- -

 

(3.1)

%

N/M

 

Restricted securities, at cost

 

 

4,417

 

 

4,951

 

 

4,939

 

(10.8)

%

(10.6)

%

Equity securities, at fair value

 

 

2,098

 

 

1,869

 

 

1,606

 

12.3

%

30.6

%

Loans, net of unearned income

 

 

1,692,652

 

 

1,666,469

 

 

1,567,112

 

1.6

%

8.0

%

Allowance for loan losses

 

 

(20,031)

 

 

(20,032)

 

 

(19,381)

 

(0.0)

%

3.4

%

Net loans

 

 

1,672,621

 

 

1,646,437

 

 

1,547,731

 

1.6

%

8.1

%

Bank premises and equipment, net

 

 

1,443

 

 

1,620

 

 

1,955

 

(10.9)

%

(26.2)

%

Accrued interest receivable

 

 

4,451

 

 

4,943

 

 

4,513

 

(10.0)

%

(1.4)

%

Bank owned life insurance

 

 

21,188

 

 

20,998

 

 

20,794

 

0.9

%

1.9

%

Right of use assets

 

 

4,281

 

 

4,913

 

 

5,608

 

(12.9)

%

(23.7)

%

Other assets

 

 

17,589

 

 

12,970

 

 

11,260

 

35.6

%

56.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

2,316,374

 

$

2,149,309

 

$

2,065,895

 

7.8

%

12.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest bearing demand deposits

 

$

512,284

 

$

488,838

 

$

478,705

 

4.8

%

7.0

%

Interest-bearing demand deposits

 

 

738,666

 

 

633,901

 

 

587,878

 

16.5

%

25.6

%

Savings deposits

 

 

112,276

 

 

101,376

 

 

79,119

 

10.8

%

41.9

%

Time deposits

 

 

680,515

 

 

657,438

 

 

669,330

 

3.5

%

1.7

%

Total deposits

 

 

2,043,741

 

 

1,881,553

 

 

1,815,032

 

8.6

%

12.6

%

Federal Home Loan Bank advances

 

 

- -

 

 

18,000

 

 

18,000

 

(100.0)

%

(100.0)

%

Subordinated debt

 

 

49,560

 

 

24,728

 

 

24,704

 

100.4

%

100.6

%

Accrued interest payable

 

 

896

 

 

843

 

 

884

 

6.3

%

1.4

%

Lease liabilities

 

 

4,538

 

 

5,182

 

 

5,873

 

(12.4)

%

(22.7)

%

Other liabilities

 

 

10,109

 

 

10,533

 

 

6,156

 

(4.0)

%

64.2

%

Total liabilities

 

 

2,108,844

 

 

1,940,839

 

 

1,870,649

 

8.7

%

12.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock, par value $0.01 per share; authorized 1,000,000 shares; none issued

 

 

- -

 

 

- -

 

 

- -

 

0.0

%

0.0

%

Common stock, nonvoting, par value $0.01 per share; authorized 1,000,000 shares; none issued

 

 

- -

 

 

- -

 

 

- -

 

0.0

%

0.0

%

Common stock, voting, par value $0.01 per share; authorized 30,000,000 shares; issued and outstanding, 14,026,589 at 6/30/2022 including 58,536 unvested shares, 13,745,598 shares at 12/31/2021 including 75,826 unvested shares and 13,639,173 at 6/30/2021, including 60,995 unvested shares

 

 

140

 

 

137

 

 

136

 

2.2

%

2.9

%

Additional paid-in capital

 

 

93,935

 

 

91,107

 

 

90,448

 

3.1

%

3.9

%

Retained earnings

 

 

130,383

 

 

117,626

 

 

103,318

 

10.8

%

26.2

%

Accumulated other comprehensive income (loss)

 

 

(16,928)

 

 

(400)

 

 

1,344

 

N/M

 

N/M

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total shareholders' equity

 

 

207,530

 

 

208,470

 

 

195,246

 

(0.5)

%

6.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities and shareholders' equity

 

$

2,316,374

 

$

2,149,309

 

$

2,065,895

 

7.8

%

12.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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,

 

 

 

 

 

2022

 

2021

 

% Change

 

2022

 

2021

 

% Change

 

 

(Unaudited)

 

(Unaudited)

 

 

 

 

(Unaudited)

 

(Unaudited)

 

 

 

Interest and Dividend Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

17,334

 

$

17,499

 

(0.9)

%

 

$

35,518

 

$

35,338

 

0.5

%

Interest on investment securities, taxable

 

 

1,893

 

 

993

 

90.6

%

 

 

3,273

 

 

1,762

 

85.8

%

Interest on investment securities, tax-exempt

 

 

30

 

 

30

 

0.0

%

 

 

60

 

 

60

 

0.0

%

Dividends

 

 

64

 

 

66

 

(3.0)

%

 

 

124

 

 

131

 

(5.3)

%

Interest on deposits in banks

 

 

234

 

 

39

 

500.0

%

 

 

325

 

 

83

 

291.6

%

Total interest and dividend income

 

 

19,555

 

 

18,627

 

5.0

%

 

 

39,300

 

 

37,374

 

5.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

1,698

 

 

1,735

 

(2.1)

%

 

 

3,021

 

 

3,795

 

(20.4)

%

Federal Home Loan Bank advances

 

 

12

 

 

30

 

(60.0)

%

 

 

42

 

 

63

 

(33.3)

%

Subordinated debt

 

 

537

 

 

371

 

44.7

%

 

 

1,013

 

 

743

 

36.3

%

Total interest expense

 

 

2,247

 

 

2,136

 

5.2

%

 

 

4,076

 

 

4,601

 

(11.4)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

17,308

 

 

16,491

 

5.0

%

 

 

35,224

 

 

32,773

 

7.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for loan losses

 

 

- -

 

 

90

 

N/M

 

 

 

- -

 

 

2,455

 

N/M

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income after provision for loan losses

 

 

17,308

 

 

16,401

 

5.5

%

 

 

35,224

 

 

30,318

 

16.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges on deposit accounts

 

 

84

 

 

60

 

40.0

%

 

 

161

 

 

118

 

36.4

%

Bank owned life insurance

 

 

95

 

 

100

 

(5.0)

%

 

 

190

 

 

207

 

(8.2)

%

Other service charges and fees

 

 

157

 

 

116

 

35.3

%

 

 

294

 

 

220

 

33.6

%

Gains on securities

 

 

- -

 

 

- -

 

N/M

 

 

 

- -

 

 

10

 

N/M

 

Insurance commissions

 

 

44

 

 

22

 

100.0

%

 

 

265

 

 

177

 

49.7

%

Other income (loss)

 

 

(271)

 

 

119

 

(327.7)

%

 

 

(387)

 

 

149

 

(359.7)

%

Total non-interest income

 

 

109

 

 

417

 

(73.9)

%

 

 

523

 

 

881

 

(40.6)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

4,655

 

 

5,680

 

(18.0)

%

 

 

10,682

 

 

10,669

 

0.1

%

Occupancy expense of premises

 

 

482

 

 

514

 

(6.2)

%

 

 

975

 

 

1,021

 

(4.5)

%

Furniture and equipment expenses

 

 

341

 

 

378

 

(9.8)

%

 

 

666

 

 

700

 

(4.9)

%

Other expenses

 

 

2,203

 

 

2,495

 

(11.7)

%

 

 

4,144

 

 

4,570

 

(9.3)

%

Total non-interest expense

 

 

7,681

 

 

9,067

 

(15.3)

%

 

 

16,467

 

 

16,960

 

(2.9)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

9,736

 

 

7,751

 

25.6

%

 

 

19,280

 

 

14,239

 

35.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

 

1,854

 

 

1,672

 

10.9

%

 

 

3,724

 

 

3,086

 

20.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

7,882

 

$

6,079

 

29.7

%

 

$

15,556

 

$

11,153

 

39.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings Per Share

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.56

 

$

0.45

 

24.4

%

 

$

1.11

 

$

0.82

 

35.4

%

Diluted

 

$

0.56

 

$

0.44

 

27.3

%

 

$

1.10

 

$

0.80

 

37.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

John Marshall Bancorp, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical Trends - Quarterly Financial Data (Unaudited)

(Dollar amounts in thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2022

 

2021

 

 

 

June 30

 

March 31

 

December 31

 

September 30

 

June 30

 

March 31

 

Profitability for the quarter:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

19,555

 

$

19,745

 

$

18,703

 

$

18,042

 

$

18,627

 

$

18,747

 

Interest expense

 

 

2,247

 

 

1,829

 

 

1,734

 

 

1,876

 

 

2,136

 

 

2,465

 

Net interest income

 

 

17,308

 

 

17,916

 

 

16,969

 

 

16,166

 

 

16,491

 

 

16,282

 

Provision for loan losses

 

 

- -

 

 

- -

 

 

325

 

 

325

 

 

90

 

 

2,365

 

Non-interest income

 

 

109

 

 

414

 

 

513

 

 

325

 

 

417

 

 

464

 

Non-interest expense

 

 

7,681

 

 

8,786

 

 

7,679

 

 

7,623

 

 

9,067

 

 

7,893

 

Income before income taxes

 

 

9,736

 

 

9,544

 

 

9,478

 

 

8,543

 

 

7,751

 

 

6,488

 

Income tax expense

 

 

1,854

 

 

1,870

 

 

1,931

 

 

1,782

 

 

1,672

 

 

1,414

 

Net income

 

$

7,882

 

$

7,674

 

$

7,547

 

$

6,761

 

$

6,079

 

$

5,074

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial performance:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets (annualized)

 

 

1.41

%

 

1.40

%

 

1.41

%

 

1.30

%

 

1.20

%

 

1.05

%

Return on average equity (annualized)

 

 

15.28

%

 

14.76

%

 

14.52

%

 

13.35

%

 

12.64

%

 

10.89

%

Net interest margin

 

 

3.16

%

 

3.33

%

 

3.22

%

 

3.15

%

 

3.31

%

 

3.43

%

Non-interest income as a percentage of average assets (annualized)

 

 

0.02

%

 

0.08

%

 

0.10

%

 

0.06

%

 

0.08

%

 

0.10

%

Non-interest expense to average assets (annualized)

 

 

1.38

%

 

1.61

%

 

1.44

%

 

1.46

%

 

1.79

%

 

1.64

%

Efficency ratio

 

 

44.1

%

 

47.9

%

 

43.9

%

 

46.2

%

 

53.6

%

 

47.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share data:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share - basic

 

$

0.56

 

$

0.55

 

$

0.55

 

$

0.50

 

$

0.45

 

$

0.37

 

Earnings per share - diluted

 

$

0.56

 

$

0.55

 

$

0.54

 

$

0.48

 

$

0.44

 

$

0.37

 

Book value per share

 

$

14.80

 

$

14.68

 

$

15.17

 

$

14.82

 

$

14.32

 

$

13.85

 

Weighted average common shares (basic)

 

 

13,932,256

 

 

13,783,034

 

 

13,581,586

 

 

13,580,538

 

 

13,572,779

 

 

13,557,779

 

Weighted average common shares (diluted)

 

 

14,085,160

 

 

13,991,692

 

 

13,879,595

 

 

13,883,104

 

 

13,868,147

 

 

13,809,751

 

Common shares outstanding at end of period

 

 

14,026,589

 

 

13,950,570

 

 

13,745,598

 

 

13,644,985

 

 

13,639,173

 

 

13,634,754

 

Dividends declared per share

 

$

- -

 

$

0.20

 

$

- -

 

$

- -

 

$

- -

 

$

- -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges on deposit accounts

 

$

84

 

$

77

 

$

74

 

$

70

 

$

60

 

$

58

 

Bank owned life insurance

 

 

95

 

 

95

 

 

102

 

 

102

 

 

100

 

 

107

 

Other service charges and fees

 

 

157

 

 

137

 

 

138

 

 

120

 

 

115

 

 

104

 

Gains on securities

 

 

- -

 

 

- -

 

 

- -

 

 

- -

 

 

- -

 

 

10

 

Insurance commissions

 

 

44

 

 

221

 

 

79

 

 

28

 

 

22

 

 

155

 

Other income (loss)

 

 

(271)

 

 

(116)

 

 

120

 

 

5

 

 

120

 

 

30

 

Total non-interest income

 

$

109

 

$

414

 

$

513

 

$

325

 

$

417

 

$

464

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

$

4,655

 

$

6,027

 

$

4,765

 

$

4,977

 

$

5,680

 

$

4,989

 

Occupancy expense of premises

 

 

482

 

 

493

 

 

480

 

 

484

 

 

514

 

 

507

 

Furniture and equipment expenses

 

 

341

 

 

325

 

 

363

 

 

373

 

 

378

 

 

322

 

Other expenses

 

 

2,203

 

 

1,941

 

 

2,071

 

 

1,789

 

 

2,495

 

 

2,075

 

Total non-interest expenses

 

$

7,681

 

$

8,786

 

$

7,679

 

$

7,623

 

$

9,067

 

$

7,893

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance Sheets at Quarter End

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans

 

$

1,692,652

 

$

1,631,260

 

$

1,666,469

 

$

1,602,377

 

$

1,567,112

 

$

1,605,783

 

Allowance for loan losses

 

 

(20,031)

 

 

(20,031)

 

 

(20,032)

 

 

(19,706)

 

 

(19,381)

 

 

(19,381)

 

Investment securities

 

 

473,914

 

 

409,692

 

 

351,629

 

 

348,742

 

 

306,030

 

 

219,106

 

Interest-earning assets

 

 

2,274,968

 

 

2,217,553

 

 

2,121,407

 

 

2,062,000

 

 

2,032,235

 

 

1,979,848

 

Total assets

 

 

2,316,374

 

 

2,249,609

 

 

2,149,309

 

 

2,095,504

 

 

2,065,895

 

 

2,009,988

 

Total deposits

 

 

2,043,741

 

 

1,983,099

 

 

1,881,553

 

 

1,837,548

 

 

1,815,032

 

 

1,761,390

 

Total interest-bearing liabilities

 

 

1,581,017

 

 

1,530,133

 

 

1,435,443

 

 

1,416,396

 

 

1,379,031

 

 

1,388,286

 

Total shareholders' equity

 

 

207,530

 

 

204,855

 

 

208,470

 

 

202,222

 

 

195,246

 

 

188,904

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarterly Average Balance Sheets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total gross loans

 

$

1,641,914

 

$

1,620,533

 

$

1,629,124

 

$

1,580,695

 

$

1,602,125

 

$

1,575,847

 

Allowance for loan losses

 

 

(20,031)

 

 

(20,032)

 

 

(19,889)

 

 

(19,525)

 

 

(19,530)

 

 

(17,816)

 

Investment securities

 

 

447,688

 

 

376,608

 

 

356,007

 

 

325,027

 

 

256,671

 

 

180,180

 

Interest-earning assets

 

 

2,204,709

 

 

2,183,897

 

 

2,090,052

 

 

2,038,384

 

 

1,996,555

 

 

1,922,835

 

Total assets

 

 

2,240,119

 

 

2,216,131

 

 

2,121,980

 

 

2,069,143

 

 

2,027,364

 

 

1,954,088

 

Total deposits

 

 

1,980,231

 

 

1,946,882

 

 

1,857,782

 

 

1,812,635

 

 

1,820,939

 

 

1,709,678

 

Total interest-bearing liabilities

 

 

1,504,574

 

 

1,505,854

 

 

1,419,679

 

 

1,384,867

 

 

1,381,583

 

 

1,350,742

 

Total shareholders' equity

 

 

206,967

 

 

210,900

 

 

206,237

 

 

200,990

 

 

192,918

 

 

188,995

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial Measures

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average equity to average assets

 

 

9.2

%

 

9.5

%

 

9.7

%

 

9.7

%

 

9.5

%

 

9.7

%

Investment securities to earning assets

 

 

20.8

%

 

18.5

%

 

16.6

%

 

16.9

%

 

15.1

%

 

11.1

%

Loans to earning assets

 

 

74.4

%

 

73.6

%

 

78.6

%

 

77.7

%

 

77.1

%

 

81.1

%

Loans to assets

 

 

73.1

%

 

72.5

%

 

77.5

%

 

76.5

%

 

75.9

%

 

79.9

%

Loans to deposits

 

 

82.8

%

 

82.3

%

 

88.6

%

 

87.2

%

 

86.3

%

 

91.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Ratios (Bank Level)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity / assets

 

 

9.9

%

 

10.2

%

 

10.8

%

 

10.8

%

 

10.6

%

 

10.5

%

Total risk-based capital ratio

 

 

15.1

%

 

15.4

%

 

15.3

%

 

15.2

%

 

15.0

%

 

14.6

%

Tier 1 risk-based capital ratio

 

 

14.0

%

 

14.2

%

 

14.0

%

 

14.0

%

 

13.9

%

 

13.4

%

Leverage ratio

 

 

11.0

%

 

10.8

%

 

11.0

%

 

10.8

%

 

10.7

%

 

10.8

%

Common equity tier 1 ratio

 

 

14.0

%

 

14.2

%

 

14.0

%

 

14.0

%

 

12.3

%

 

13.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

John Marshall Bancorp, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loan, Deposit and Borrowing Detail (Unaudited)

(Dollar amounts in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2022

 

2021

 

 

 

June 30

 

March 31

 

December 31

 

September 30

 

June 30

 

March 31

 

Loans

 

$ Amount

% of Total

 

$ Amount

% of Total

 

$ Amount

% of Total

 

$ Amount

% of Total

 

$ Amount

% of Total

 

$ Amount

% of Total

 

Commercial business loans

 

$

47,654

2.8

%

$

52,569

3.2

%

$

53,378

3.2

%

$

53,166

3.3

%

$

55,375

3.5

%

$

60,637

3.8

%

Commercial PPP loans

 

 

224

0.0

%

 

7,781

0.5

%

 

69,567

4.2

%

 

75,496

4.7

%

 

82,190

5.2

%

 

117,796

7.3

%

Commercial owner-occupied real estate loans

 

 

378,457

22.4

%

 

339,933

20.9

%

 

345,272

20.7

%

 

326,585

20.4

%

 

320,519

20.4

%

 

307,918

19.2

%

Total business loans

 

 

426,335

25.2

%

 

400,283

24.6

%

 

468,217

28.1

%

 

455,247

28.4

%

 

458,084

29.2

%

 

486,351

30.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investor real estate loans

 

 

598,501

35.5

%

 

553,093

34.0

%

 

523,038

31.4

%

 

519,384

32.4

%

 

505,605

32.3

%

 

502,940

31.3

%

Construction & development loans

 

 

189,644

11.2

%

 

219,160

13.4

%

 

231,090

13.9

%

 

228,993

14.3

%

 

219,175

14.0

%

 

250,208

15.6

%

Multi-family loans

 

 

106,236

6.3

%

 

99,100

6.1

%

 

100,132

6.0

%

 

81,226

5.1

%

 

92,203

5.9

%

 

84,689

5.3

%

Total commercial real estate loans

 

 

894,381

53.0

%

 

871,353

53.5

%

 

854,260

51.3

%

 

829,603

51.8

%

 

816,983

52.1

%

 

837,837

52.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage loans

 

 

368,370

21.8

%

 

356,331

21.9

%

 

342,491

20.6

%

 

316,549

19.8

%

 

291,615

18.6

%

 

281,964

17.5

%

Consumer loans

 

 

651

0.0

%

 

513

0.0

%

 

586

0.0

%

 

631

0.0

%

 

916

0.1

%

 

793

0.0

%

Total loans

 

$

1,689,737

100.0

%

$

1,628,480

100.0

%

$

1,665,554

100.0

%

$

1,602,030

100.0

%

$

1,567,598

100.0

%

$

1,606,945

100.0

%

Less: Allowance for loan losses

 

 

(20,031)

 

 

 

(20,031)

 

 

 

(20,032)

 

 

 

(19,706)

 

 

 

(19,381)

 

 

 

(19,381)

 

 

Net deferred loan costs (fees)

 

 

2,915

 

 

 

2,780

 

 

 

915

 

 

 

347

 

 

 

(486)

 

 

 

(1,162)

 

 

Net loans

 

$

1,672,621

 

 

$

1,611,229

 

 

$

1,646,437

 

 

$

1,582,671

 

 

$

1,547,731

 

 

$

1,586,402

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2022

 

2021

 

 

 

June 30

 

March 31

 

December 31

 

September 30

 

June 30

 

March 31

 

Deposits

 

$ Amount

% of Total

 

$ Amount

% of Total

 

$ Amount

% of Total

 

$ Amount

% of Total

 

$ Amount

% of Total

 

$ Amount

% of Total

 

Non-interest bearing demand deposits

 

$

512,284

25.1

%

$

495,811

25.0

%

$

488,838

26.0

%

$

463,868

25.2

%

$

478,705

26.4

%

$

419,796

23.8

%

Interest-bearing demand deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW accounts(1)

 

 

338,789

16.6

%

 

345,087

17.4

%

 

267,594

14.2

%

 

294,261

16.0

%

 

254,060

14.0

%

 

245,274

13.9

%

Money market accounts(1)

 

 

399,877

19.6

%

 

414,987

20.9

%

 

366,306

19.4

%

 

336,651

18.3

%

 

333,818

18.4

%

 

344,807

19.6

%

Savings accounts

 

 

112,276

5.4

%

 

114,427

5.8

%

 

101,376

5.4

%

 

94,840

5.2

%

 

79,119

4.4

%

 

72,102

4.1

%

Certificates of deposit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$250,000 or more

 

 

255,411

12.5

%

 

241,230

12.1

%

 

250,204

13.3

%

 

232,722

12.7

%

 

243,662

13.4

%

 

265,772

15.1

%

Less than $250,000

 

 

87,505

4.3

%

 

91,050

4.6

%

 

103,084

5.5

%

 

104,463

5.7

%

 

112,991

6.2

%

 

119,828

6.8

%

QwickRate® certificates of deposit

 

 

20,154

1.0

%

 

23,136

1.2

%

 

25,122

1.3

%

 

28,998

1.6

%

 

31,481

1.7

%

 

38,565

2.2

%

IntraFi® certificates of deposit

 

 

32,686

1.6

%

 

39,628

2.0

%

 

61,281

3.3

%

 

66,926

3.6

%

 

60,761

3.3

%

 

38,284

2.2

%

Brokered deposits

 

 

284,759

13.9

%

 

217,743

11.0

%

 

217,748

11.6

%

 

214,819

11.7

%

 

220,435

12.1

%

 

216,962

12.3

%

Total deposits

 

$

2,043,741

100.0

%

$

1,983,099

100.0

%

$

1,881,553

100.0

%

$

1,837,548

100.0

%

$

1,815,032

100.0

%

$

1,761,390

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowings

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Home Loan Bank advances

 

$

- -

0.0

%

$

18,000

42.0

%

$

18,000

42.1

%

$

18,000

42.1

%

$

18,000

42.2

%

$

22,000

47.1

%

Subordinated debt

 

 

49,560

100.0

%

 

24,845

58.0

%

 

24,728

57.9

%

 

24,716

57.9

%

 

24,704

57.8

%

 

24,692

52.9

%

Total borrowings

 

$

49,560

100.0

%

$

42,845

100.0

%

$

42,728

100.0

%

$

42,716

100.0

%

$

42,704

100.0

%

$

46,692

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total deposits and borrowings

 

$

2,093,301

 

 

$

2,025,944

 

 

$

1,924,281

 

 

$

1,880,264

 

 

$

1,857,736

 

 

$

1,808,082

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Core customer funding sources (2)

 

$

1,738,828

85.1

%

$

1,742,220

85.2

%

$

1,638,683

86.3

%

$

1,593,731

85.9

%

$

1,563,116

85.3

%

$

1,505,863

84.4

%

Wholesale funding sources (3)

 

 

304,913

14.9

%

 

258,879

12.7

%

 

260,870

13.7

%

 

261,817

14.1

%

 

269,916

14.7

%

 

277,527

15.6

%

Total funding sources

 

$

2,043,741

100.0

%

$

2,001,099

97.9

%

$

1,899,553

100.0

%

$

1,855,548

100.0

%

$

1,833,032

100.0

%

$

1,783,390

100.0

%

(1)

 

Includes IntraFi® accounts.

(2)

 

Includes reciprocal IntraFi Demand®, IntraFi Money Market® and IntraFi CD® deposits, which are maintained by customers.

(3)

 

Consists of QwickRate® certificates of deposit, brokered deposits, federal funds purchased and Federal Home Loan Bank advances.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

John Marshall Bancorp, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Balance Sheets, Interest and Rates (unaudited)

 

(Dollar amounts in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six months ended June 30, 2022

 

Six months ended June 30, 2021

 

 

 

 

 

 

Interest Income /

 

Average

 

 

 

 

Interest Income /

 

Average

 

 

 

Average Balance

 

Expense

 

Rate

 

Average Balance

 

Expense

 

Rate

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

$

407,341

 

$

3,397

 

1.68

%

$

213,585

 

$

1,892

 

1.79

%

Tax-exempt(1)

 

 

5,004

 

 

76

 

3.06

%

 

5,052

 

 

77

 

3.07

%

Total securities

 

$

412,345

 

$

3,473

 

1.70

%

$

218,637

 

$

1,969

 

1.82

%

Loans, net of unearned income(2):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

1,611,916

 

 

35,209

 

4.40

%

 

1,570,969

 

 

35,001

 

4.49

%

Tax-exempt(1)

 

 

19,367

 

 

391

 

4.07

%

 

18,090

 

 

427

 

4.76

%

Total loans, net of unearned income

 

$

1,631,283

 

$

35,600

 

4.40

%

$

1,589,059

 

$

35,428

 

4.50

%

Interest-bearing deposits in other banks

 

$

150,734

 

$

325

 

0.43

%

$

152,203

 

$

83

 

0.11

%

Total interest-earning assets

 

$

2,194,362

 

$

39,398

 

3.62

%

$

1,959,899

 

$

37,480

 

3.86

%

Total non-interest earning assets

 

 

33,830

 

 

 

 

 

 

 

31,029

 

 

 

 

 

 

Total assets

 

$

2,228,192

 

 

 

 

 

 

$

1,990,928

 

 

 

 

 

 

Liabilities & Shareholders’ Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW accounts

 

$

323,546

 

$

424

 

0.26

%

$

244,952

 

$

392

 

0.32

%

Money market accounts

 

 

395,532

 

 

789

 

0.40

%

 

336,528

 

 

630

 

0.38

%

Savings accounts

 

 

111,312

 

 

177

 

0.32

%

 

71,307

 

 

135

 

0.38

%

Time deposits

 

 

635,359

 

 

1,631

 

0.52

%

 

670,014

 

 

2,638

 

0.79

%

Total interest-bearing deposits

 

$

1,465,749

 

$

3,021

 

0.42

%

$

1,322,801

 

$

3,795

 

0.58

%

Subordinated debt

 

 

27,007

 

 

1,013

 

7.56

%

 

24,690

 

 

743

 

6.07

%

Other borrowed funds

 

 

12,453

 

 

42

 

0.68

%

 

18,757

 

 

63

 

0.68

%

Total interest-bearing liabilities

 

$

1,505,209

 

$

4,076

 

0.55

%

$

1,366,248

 

$

4,601

 

0.68

%

Demand deposits

 

 

497,899

 

 

 

 

 

 

 

421,349

 

 

 

 

 

 

Other liabilities

 

 

16,161

 

 

 

 

 

 

 

12,364

 

 

 

 

 

 

Total liabilities

 

$

2,019,269

 

 

 

 

 

 

$

1,799,961

 

 

 

 

 

 

Shareholders’ equity

 

$

208,923

 

 

 

 

 

 

$

190,967

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

2,228,192

 

 

 

 

 

 

$

1,990,928

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tax-equivalent net interest income and spread

 

 

 

 

$

35,322

 

3.07

%

 

 

 

$

32,879

 

3.18

%

Less: tax-equivalent adjustment

 

 

 

 

 

98

 

 

 

 

 

 

 

106

 

 

 

Net interest income

 

 

 

 

$

35,224

 

 

 

 

 

 

$

32,773

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income/earnings assets

 

 

 

 

 

 

 

3.62

%

 

 

 

 

 

 

3.86

%

Interest expense/earning assets

 

 

 

 

 

 

 

0.37

%

 

 

 

 

 

 

0.48

%

Net interest margin

 

 

 

 

 

 

 

3.25

%

 

 

 

 

 

 

3.38

%

(1)

 

Tax-equivalent income has been adjusted using the federal statutory tax rate of 21%. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $98 thousand and $106 thousand in 2022 and 2021, respectively.

(2)

 

The Company did not have any loans on non-accrual as of June 30, 2022 or June 30, 2021.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

John Marshall Bancorp, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Balance Sheets, Interest and Rates (unaudited)

 

(Dollar amounts in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended June 30, 2022

 

Three months ended June 30, 2021

 

 

 

 

 

 

Interest Income /

 

Average

 

 

 

 

Interest Income /

 

Average

 

 

 

Average Balance

 

Expense

 

Rate

 

Average Balance

 

Expense

 

Rate

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

$

442,686

 

$

1,957

 

1.77

%

$

251,654

 

$

1,059

 

1.69

%

Tax-exempt(1)

 

 

5,002

 

 

38

 

3.05

%

 

5,017

 

 

38

 

3.04

%

Total securities

 

$

447,688

 

$

1,995

 

1.79

%

$

256,671

 

$

1,097

 

1.71

%

Loans, net of unearned income(2):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

1,622,666

 

 

17,180

 

4.25

%

 

1,577,125

 

 

17,295

 

4.40

%

Tax-exempt(1)

 

 

19,248

 

 

195

 

4.06

%

 

25,000

 

 

259

 

4.16

%

Total loans, net of unearned income

 

$

1,641,914

 

$

17,375

 

4.24

%

$

1,602,125

 

$

17,554

 

4.39

%

Interest-bearing deposits in other banks

 

$

115,107

 

$

234

 

0.82

%

$

137,759

 

$

39

 

0.11

%

Total interest-earning assets

 

$

2,204,709

 

$

19,604

 

3.57

%

$

1,996,555

 

$

18,690

 

3.75

%

Total non-interest earning assets

 

 

35,410

 

 

 

 

 

 

 

30,809

 

 

 

 

 

 

Total assets

 

$

2,240,119

 

 

 

 

 

 

$

2,027,364

 

 

 

 

 

 

Liabilities & Shareholders’ Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW accounts

 

$

322,255

 

$

222

 

0.28

%

$

250,845

 

$

194

 

0.31

%

Money market accounts

 

 

398,641

 

 

439

 

0.44

%

 

337,752

 

 

314

 

0.37

%

Savings accounts

 

 

114,216

 

 

89

 

0.31

%

 

75,321

 

 

70

 

0.37

%

Time deposits

 

 

633,273

 

 

948

 

0.60

%

 

674,969

 

 

1,157

 

0.69

%

Total interest-bearing deposits

 

$

1,468,385

 

$

1,698

 

0.46

%

$

1,338,887

 

$

1,735

 

0.52

%

Subordinated debt

 

 

29,222

 

 

537

 

7.37

%

 

24,696

 

 

371

 

6.03

%

Other borrowed funds

 

 

6,967

 

 

12

 

0.69

%

 

18,000

 

 

30

 

0.67

%

Total interest-bearing liabilities

 

$

1,504,574

 

$

2,247

 

0.60

%

$

1,381,583

 

$

2,136

 

0.62

%

Demand deposits

 

 

511,846

 

 

 

 

 

 

 

439,356

 

 

 

 

 

 

Other liabilities

 

 

16,732

 

 

 

 

 

 

 

13,507

 

 

 

 

 

 

Total liabilities

 

$

2,033,152

 

 

 

 

 

 

$

1,834,446

 

 

 

 

 

 

Shareholders’ equity

 

$

206,967

 

 

 

 

 

 

$

192,918

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

2,240,119

 

 

 

 

 

 

$

2,027,364

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tax-equivalent net interest income and spread

 

 

 

 

$

17,357

 

2.97

%

 

 

 

$

16,554

 

3.13

%

Less: tax-equivalent adjustment

 

 

 

 

 

49

 

 

 

 

 

 

 

63

 

 

 

Net interest income

 

 

 

 

$

17,308

 

 

 

 

 

 

$

16,491

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income/earnings assets

 

 

 

 

 

 

 

3.57

%

 

 

 

 

 

 

3.75

%

Interest expense/earning assets

 

 

 

 

 

 

 

0.41

%

 

 

 

 

 

 

0.43

%

Net interest margin

 

 

 

 

 

 

 

3.16

%

 

 

 

 

 

 

3.32

%

(1)

 

Tax-equivalent income has been adjusted using the federal statutory tax rate of 21%. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $49 thousand and $63 thousand in 2022 and 2021, respectively.

(2)

 

The Company did not have any loans on non-accrual as of June 30, 2022 or June 30, 2021.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

John Marshall Bancorp, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Certain Non-GAAP Financial Measures (unaudited)

 

(Dollar amounts in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

 

Six months ended

 

 

 

June 30,

 

 

June 30,

 

 

 

2022

 

2021

 

 

2022

 

2021

 

Cost of interest-bearing liabilities adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense (GAAP)

 

$

2,247

 

$

2,136

 

 

$

4,076

 

$

4,601

 

Less: Accelerated amortization on 2017 notes

 

 

104

 

 

 

 

 

208

 

 

 

Less: Interest expense on 2022 note

 

 

62

 

 

 

 

 

62

 

 

 

Interest expense, excluding accelerated amortization on 2017 notes and interest expense on 2022 note (Non-GAAP)

 

$

2,081

 

$

2,136

 

 

$

3,806

 

$

4,601

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average interest-bearing liabilities (GAAP)

 

$

1,504,574

 

$

1,381,583

 

 

$

1,505,209

 

$

1,366,248

 

Less: Average balance of 2017 notes without accelerated amortization

 

 

51

 

 

 

 

 

101

 

 

 

Less: Average balance of 2022 note

 

 

4,325

 

 

 

 

 

2,174

 

 

 

Average interest-bearing liabilities, excluding accelerated amortization on 2017 notes and interest expense on 2022 note (Non-GAAP)

 

$

1,500,198

 

$

1,381,583

 

 

$

1,502,934

 

$

1,366,248

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of interest-bearing liabilities (GAAP)

 

 

0.60

%

 

0.62

%

 

 

0.55

%

 

0.68

%

Cost of interest-bearing liabilities, excluding accelerated amortization on 2017 notes and interest expense on 2022 note (GAAP)

 

 

0.56

%

 

0.62

%

 

 

0.51

%

 

0.68

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income (GAAP)

 

$

19,555

 

$

18,627

 

 

$

39,300

 

$

37,374

 

Interest expense, excluding accelerated amortization on 2017 notes and interest expense on 2022 note (Non-GAAP)

 

 

2,081

 

 

2,136

 

 

 

3,806

 

 

4,601

 

Average interest-earning assets (GAAP)

 

 

2,204,709

 

 

1,996,555

 

 

 

2,194,362

 

 

1,959,899

 

Net interest margin (GAAP)

 

 

3.15

%

 

3.31

%

 

 

3.24

%

 

3.37

%

Net interest margin, excluding accelerated amortization on 2017 notes and interest expense on 2022 note (Non-GAAP)

 

 

3.18

%

 

3.31

%

 

 

3.26

%

 

3.37

%

 

Contacts

Christopher W. Bergstrom (703) 584-0840

Kent D. Carstater (703) 289-5922

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