Company's Net Income Climbs 20% to $26.7 Million; NIM Reaches 4.19%

FAIRFAX, Va., Jan. 23, 2023 /PRNewswire/ -- MainStreet Bancshares, Inc. (NASDAQ:MNSB, MNSBP))), the holding company for MainStreet Bank, reported record net income of $26.7 million for 2022, a 20.3% increase from a year earlier. Year-end results represent:

13.98% return on average equity
1.53% return on average assets
4.19% net interest margin
$3.26 earnings per common share (basic and diluted)
$21.75 tangible book value per common share

There is no doubt that 2022 was a banner year for the Company.

"There is no doubt that 2022 was a banner year for the Company," said Jeff W. Dick, Chairman and CEO of MainStreet Bancshares Inc. and MainStreet Bank. "Quarter to quarter, we set performance records in nearly every activity and metric. We achieved this while maintaining our strong focus on credit quality and while building Avenu™, our innovative embedded banking software solution. The markets rewarded our upward momentum, efficiency, and focus on innovation with solid interest in our shares and improved valuations."

Net interest income reached $70 million in 2022, up 30.8% from the previous year's $53.5 million. As the Federal Reserve undertook seven interest rate increases in 2022, MainStreet Bank benefited from having an asset-sensitive balance sheet. This drove the average net interest margin (NIM) higher by 84 basis points to 4.19% for the year ended December 31, 2022, versus 3.35% a year earlier. On a quarterly basis, the NIM widened to 4.70% in the fourth quarter of 2022, up from 3.49% in the prior year's fourth quarter.

"We came into 2022 extremely well prepared for the interest rate hikes that materialized," said Thomas J. Chmelik, Chief Financial Officer of MainStreet Bancshares Inc. and MainStreet Bank. "As we enter 2023, we anticipate fewer and smaller rate hikes as the Fed makes progress toward dampening inflation, and this should yield somewhat more level interest rates this year. We are now taking steps to position our balance sheet accordingly." He noted that the level of Accumulated Other Comprehensive Income (AOCI) for the Company remains low, at -4.3% of total capital.

The loan portfolio grew 17.8% to $1.58 billion in 2022, up from $1.34 billion at the end of 2021. Loan quality remained exceptional, with zero nonperforming assets. Total deposits climbed 7% to $1.51 billion, up from $1.41 billion at the end of 2021. Non-interest-bearing deposits represent 36.4% of the total, and 69% of total deposits are core deposits. The bank's total assets grew 16.9% to reach $1.93 billion at year-end 2022, versus $1.65 billion a year earlier.

"We continue to experience solid commercial loan demand and deposit growth in our DC Metro market, and loan demand was particularly brisk in the fourth quarter," said Abdul Hersiburane, President of MainStreet Bank. "Our local economy is supported by a technologically advanced workforce and a large and steady federal employment base, and these factors mitigate the effects of any slowdown. We remain encouraged by the opportunities that we see to serve our community's growing businesses and organizations. Because we maintain rigorous underwriting standards, our credit quality remains pristine."

The Company's efficiency ratio improved to 52% for the year, from 55% at the end of 2021. This improvement occurred even as the Company was making significant investments in Avenu™, with the hiring process accelerating as the subsidiary moves toward being fully operational in 2023.

Avenu™ Makes Major Strides, Onboards First Client

Avenu™ continues to make strides and has onboarded its first customer into its sandbox. In recent weeks Avenu™ has stood up its production site and is in the process of finalizing vendor certifications and conducting end-to-end testing. Avenu™ connects partners and their apps directly and seamlessly to MainStreet Bank's banking core. These developments bring Avenu™ several steps closer to its objective of accelerating MainStreet Bank's deposit growth to support expanded lending.

"As technology evolves, consumers expect to be able to conduct transactions seamlessly using apps offered by communities they are part of and merchants they patronize regularly," said Todd Youngren, president of Avenu™. "We created Avenu™ to be a gateway to the fast, simple, secure payments that our clients' end users demand, and we are excited to 'go live' with our first client."

Chairman and CEO Jeff W. Dick elaborated: "In creating Avenu™, we sought to ensure that our partners and their consumers have a flawless experience with the banking services we provide them. Our emphasis on getting compliance right is critical. Our innovative approach ensures that our partners can connect to the core system of a reliable bank with well-honed instincts about regulatory compliance and a clear line of sight into any emerging risks."

ABOUT AVENU™

Avenu™ — Banking Delivered

Avenu™ is the only embedded banking solution that connects our partners and their apps directly and seamlessly to a banking core — MainStreet Bank's banking core. We are not a sponsor bank without our own technology, and we are not a middleware software company (aggregator) without our own bank. We are Avenu™, a leading financial technology company backed by an established community business bank in the heart of Washington, D.C.

Avenu™ — Serving a Community of Innovation

Our clients are fintechs, application developers, money movers, and entrepreneurs. They all have one thing in common: They are innovating how money moves to solve real-world issues and help communities thrive. We are focused on servicing our community and long-term business relationships.

ABOUT MAINSTREET BANK: MainStreet operates six branches in Herndon, Fairfax, McLean, Leesburg, Clarendon, and Washington, D.C. MainStreet Bank has 55,000 free ATMs and a fully integrated online and mobile banking solution. The Bank is not restricted by a conventional branching system, as it can offer business customers the ability to Put Our Bank in Your Office^®. With robust and easy-to-use online business banking technology, MainStreet has "put our bank" in thousands of businesses in the metropolitan area.

MainStreet Bank has a robust line of business and professional lending products, including government contracting lines of credit, commercial lines and term loans, residential and commercial construction, and commercial real estate. MainStreet also works with the SBA to offer 7A and 504 lending solutions. From sophisticated cash management to enhanced mobile banking and instant-issue Debit Cards, MainStreet Bank is always looking for ways to improve our customer's experience.

MainStreet Bank was the first community bank in the Washington, D.C., metropolitan area to offer a full online business banking solution. MainStreet Bank was also the first bank headquartered in the Commonwealth of Virginia to offer CDARS – a solution that provides multi-million-dollar FDIC insurance. Further information on the Bank can be obtained by visiting its website at mstreetbank.com.

Contact: Debra Cope

Director of Corporate Communications

(703) 481-4599

UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION (In thousands)
	December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022		December 31, 2021
ASSETS
Cash and cash equivalents
Cash and due from banks	$	48,931	$	50,636	$	55,636	$	63,986	$	61,827
Federal funds sold		81,669		54,098		47,013		37,756		31,372
Total cash and cash equivalents		130,600		104,734		102,649		101,742		93,199
Investment securities available for sale, at fair value		62,631		162,319		143,240		123,802		99,913
Investment securities held to maturity, at carrying value		17,642		17,670		17,698		18,769		20,349
Restricted equity securities, at cost		24,325		16,436		16,485		17,209		15,609
Loans, net of allowance for loan losses of $14,114, $12,994, $12,982,$12,500, and $11,697, respectively		1,579,950		1,448,071		1,416,875		1,413,238		1,341,760
Premises and equipment, net		14,709		14,523		14,756		14,833		14,863
Other real estate owned, net		—		—		—		—		775
Accrued interest and other receivables		9,581		8,273		7,313		6,980		7,701
Computer software, net of amortization		9,149		7,258		4,956		3,906		2,493
Bank owned life insurance		37,249		36,996		36,742		36,492		36,241
Other assets		39,915		43,835		32,665		24,777		14,499
Total Assets	$	1,925,751	$	1,860,115	$	1,793,379	$	1,761,748	$	1,647,402
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Non-interest bearing deposits	$	550,690	$	566,016	$	535,591	$	514,160	$	530,678
Interest bearing DDA deposits		80,099		93,695		99,223		76,286		69,232
Savings and NOW deposits		51,419		54,240		58,156		81,817		85,175
Money market deposits		222,540		254,190		231,207		301,842		267,730
Time deposits		608,141		585,783		575,950		460,839		459,148
Total deposits		1,512,889		1,553,924		1,500,127		1,434,944		1,411,963
Federal Home Loan Bank advances and other borrowings		100,000		—		—		40,000		—
Subordinated debt		72,245		72,146		72,047		71,955		29,294
Other liabilities		42,335		44,045		32,801		26,053		17,357
Total Liabilities		1,727,469		1,670,115		1,604,975		1,572,952		1,458,614
Stockholders' Equity:
Preferred stock		27,263		27,263		27,263		27,263		27,263
Common stock		28,736		28,728		29,178		29,642		29,466
Capital surplus		63,999		63,231		64,822		66,798		67,668
Retained earnings		86,830		80,534		73,702		68,691		64,194
Accumulated other comprehensive income (loss)		(8,546)		(9,756)		(6,561)		(3,598)		197
Total Stockholders' Equity		198,282		190,000		188,404		188,796		188,788
Total Liabilities and Stockholders' Equity	$	1,925,751	$	1,860,115	$	1,793,379	$	1,761,748	$	1,647,402

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION (In thousands, except share and per share data)
	Year-to-Date				Three Months Ended
	December 31, 2022		December 31, 2021		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022		December 31, 2021
INTEREST INCOME:
Interest and fees on loans	$	78,872	$	61,743	$	23,972	$	20,261	$	17,954	$	16,685	$	15,532
Interest on investment securities
Taxable securities		1,603		1,262		467		378		401		357		327
Tax-exempt securities		1,058		1,060		262		261		263		272		283
Interest on federal funds sold		2,312		134		1,071		1,013		195		34		61
Total interest income		83,845		64,199		25,772		21,913		18,813		17,348		16,203
INTEREST EXPENSE:
Interest on interest bearing DDA deposits		601		229		256		175		105		65		59
Interest on savings and NOW deposits		203		165		81		43		42		37		38
Interest on money market deposits		1,547		772		781		496		151		119		127
Interest on time deposits		8,202		7,613		2,966		2,275		1,530		1,431		1,574
Interest on Federal Home Loan Bank advances and other borrowings		347		—		264		—		52		31		—
Interest on subordinated debt		2,936		1,884		828		828		812		468		539
Total interest expense		13,836		10,663		5,176		3,817		2,692		2,151		2,337
Net interest income		70,009		53,536		20,596		18,096		16,121		15,197		13,866
Provision for (recovery of) loan losses		2,398		(1,175)		1,118		—		480		800		295
Net interest income after provision for (recovery of) loan losses		67,611		54,711		19,478		18,096		15,641		14,397		13,571
NON-INTEREST INCOME:
Deposit account service charges		2,420		2,426		610		601		597		611		624
Bank owned life insurance income		1,008		900		253		254		250		251		253
Loan swap fee income		619		83		—		518		101		—		83
Net gain on held-to-maturity securities		4		6		—		—		4		—		3
Net gain (loss) on sale of loans		(168)		847		—		(211)		—		43		413
Other non-interest income		951		1,848		196		186		312		257		247
Total other income		4,834		6,110		1,059		1,348		1,264		1,162		1,623
NON-INTEREST EXPENSES:
Salaries and employee benefits		23,801		19,305		6,775		5,874		5,604		5,548		5,029
Furniture and equipment expenses		2,786		2,468		710		760		659		657		726
Advertising and marketing		2,304		1,565		620		704		574		406		450
Occupancy expenses		1,471		1,541		378		400		352		341		449
Outside services		2,075		908		529		611		567		368		485
Administrative expenses		872		685		214		253		195		210		192
Other operating expenses		5,748		6,393		1,481		1,291		1,543		1,433		1,389
Total non-interest expenses		39,057		32,865		10,707		9,893		9,494		8,963		8,720
Income before income tax expense		33,388		27,956		9,830		9,551		7,411		6,596		6,474
Income tax expense		6,714		5,785		2,252		1,808		1,481		1,173		1,660
Net income		26,674		22,171		7,578		7,743		5,930		5,423		4,814
Preferred stock dividends		2,156		2,156		539		539		539		539		539
Net income available to common shareholders	$	24,518	$	20,015	$	7,039	$	7,204	$	5,391	$	4,884	$	4,275
Net income per common share, basic and diluted	$	3.26	$	2.65	$	0.95	$	0.97	$	0.71	$	0.64	$	0.56
Weighted average number of common shares, basic and diluted		7,529,259		7,595,781		7,433,607		7,463,719		7,575,484		7,647,519		7,595,062

UNAUDITED LOAN, DEPOSIT AND BORROWING DETAIL *(In thousands)*
	December 31, 2022					September 30, 2022					December 31, 2021					Percentage Change
	$ Amount		% of Total			$ Amount		% of Total			$ Amount		% of Total			Last 3 Mos			Last 12 Mos
LOANS:
Construction and land development loans	$	393,783		24.6	%	$	366,689		25.0	%	$	337,173		24.8	%		7.4	%		16.8	%
Residential real estate loans		394,394		24.7	%		373,056		25.4	%		300,390		22.1	%		5.7	%		31.3	%
Commercial real estate loans		700,728		43.8	%		638,110		43.5	%		534,187		39.3	%		9.8	%		31.2	%
Commercial industrial loans - Other		97,351		6.1	%		74,482		5.1	%		164,014		12.1	%		30.7	%		-40.6	%
Consumer loans		13,336		0.8	%		13,628		1.0	%		23,171		2.3	%		-2.1	%		-42.4	%
Total Gross Loans	$	1,599,592		100.0	%	$	1,465,965		100.0	%	$	1,358,935		100.0	%		9.1	%		17.7	%
Less: Allowance for loan losses		(14,114)					(12,994)					(11,697)
Net deferred loan fees		(5,528)					(4,900)					(5,478)
Net Loans	$	1,579,950				$	1,448,071				$	1,341,760
DEPOSITS:
Non-interest bearing demand deposits	$	550,690		36.4	%	$	566,016		36.4	%	$	530,678		37.6	%		-2.7	%		3.8	%
Interest-bearing demand deposits:
Demand deposits		80,099		5.3	%		93,695		6.0	%		69,232		4.9	%		-14.5	%		15.7	%
Savings and NOW deposits		51,419		3.4	%		54,240		3.5	%		85,175		6.0	%		-5.2	%		-39.6	%
Money market accounts		222,540		14.7	%		254,190		16.4	%		267,730		19.0	%		-12.5	%		-16.9	%
Certificates of deposit $250,000 or more		370,005		24.5	%		371,739		23.9	%		285,395		20.2	%		-0.5	%		29.6	%
Certificates of deposit less than $250,000		238,136		15.7	%		214,044		13.8	%		173,753		13.4	%		11.3	%		37.1	%
Total Deposits	$	1,512,889		100.0	%	$	1,553,924		100.0	%	$	1,411,963		100.0	%		-2.6	%		7.1	%
BORROWINGS:
Federal Home Loan Bank advances		100,000		58.1	%		—		0.0	%		—		—			100.0	%		0.0	%
Subordinated debt		72,245		41.9	%		72,146		100.0	%		29,294		100.0	%		0.1	%		146.6	%
Total Borrowings	$	172,245		100.0	%	$	72,146		100.0	%	$	29,294		100.0	%		138.7	%		488.0	%
Total Deposits and Borrowings	$	1,685,134				$	1,626,070				$	1,441,257					3.6	%		16.9	%

Core customer funding sources ⁽¹⁾	$	1,157,573		68.7	%	$	1,156,862		71.1	%	$	1,108,177		76.9	%		0.1	%		4.5	%
Brokered and listing service sources ⁽²⁾		355,316		21.1	%		397,062		24.5	%		303,786		21.1	%		-10.5	%		17.0	%
Federal Home Loan Bank advances		100,000		5.9	%		—		0.0	%		—		—			100.0	%		0.0	%
Subordinated debt ⁽³⁾		72,245		4.3	%		72,146		4.4	%		29,294		2.0	%		0.1	%		146.6	%
Total Funding Sources	$	1,685,134		100.0	%	$	1,626,070		100.0	%	$	1,441,257		100.0	%		3.6	%		16.9	%

(1)	Includes ICS, CDARS, and reciprocal deposits maintained by customers, which represent sweep accounts tied to customer operating accounts
(2)	Consists of certificates of deposit (CD) through multiple listing services and multiple brokered deposit services, as well as ICS and CDARS one-way certificates of deposit and regional money market accounts
(3)	Subordinated debt obligation qualifies as Tier 2 capital at the holding company and Tier 1 capital at the Bank

UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES (In thousands)
	For the three months ended December 31, 2022							For the three months ended December 31, 2021
	Average Balance		Interest Income/ Expense (3)(4)		Average Yields/ Rate (annualized) (3)(4)			Average Balance		Interest Income/ Expense (3)(4)		Average Yields/ Rate (annualized) (3)(4)
ASSETS:
Interest earning assets:
Loans ⁽¹⁾⁽²⁾	$	1,510,087	$	23,972		6.30	%	$	1,277,828	$	15,532		4.82	%
Securities:
Taxable		70,776		467		2.62	%		76,776		327		1.69	%
Tax-exempt		38,007		332		3.46	%		38,936		358		3.65	%
Federal funds and interest-bearing deposits		124,865		1,071		3.40	%		192,442		61		0.13	%
Total interest earning assets	$	1,743,735	$	25,842		5.88	%	$	1,585,982	$	16,278		4.07	%
Other assets		55,559							87,072
Total assets	$	1,799,294						$	1,673,054
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits	$	81,724	$	256		1.24	%	$	69,532	$	59		0.34	%
Savings and NOW deposits		53,570		81		0.60	%		82,048		38		0.18	%
Money market deposit accounts		213,530		781		1.45	%		296,063		127		0.17	%
Time deposits		613,262		2,966		1.92	%		466,190		1,574		1.34	%
Total interest-bearing deposits	$	962,086	$	4,084		1.68	%	$	913,833	$	1,798		0.78	%
Federal funds purchased		2		—		—			1		—		—
Subordinated debt		72,206		828		4.55	%		40,297		539		5.31	%
FHLB borrowings		23,913		264		4.38	%		—		—		—
Total interest-bearing liabilities	$	1,058,207	$	5,176		1.94	%	$	954,131	$	2,337		0.97	%
Demand deposits and other liabilities		546,827							532,216
Total liabilities	$	1,605,034						$	1,486,347
Stockholders' Equity		194,260							186,707
Total Liabilities and Stockholders' Equity	$	1,799,294						$	1,673,054
Interest Rate Spread						3.94	%						3.10	%
Net Interest Income			$	20,666						$	13,941
Net Interest Margin						4.70	%						3.49	%

(1)	Includes loans classified as non-accrual
(2)	Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs
(3)	Income and yields for all periods presented are reported on a tax-equivalent basis using the federal statutory rate of 21%
(4)	Refer to Appendix for reconciliation of non-GAAP measures

UNAUDITED AVERAGE BALANCE SHEETS, INTEREST AND RATES (In thousands)
	For the year ended December 31, 2022							For the year ended December 31, 2021
	Average Balance		Interest Income/ Expense (3)(4)		Average Yields/ Rate (annualized) (3)(4)			Average Balance		Interest Income/ Expense (3)(4)		Average Yields/ Rate (annualized) (3)(4)
ASSETS:
Interest earning assets:
Loans ⁽¹⁾⁽²⁾	$	1,442,716	$	78,872		5.47	%	$	1,289,445	$	61,743		4.79	%
Securities:
Taxable		72,809		1,603		2.20	%		60,732		1,262		2.08	%
Tax-exempt		38,528		1,339		3.48	%		39,170		1,342		3.43	%
Federal funds and interest-bearing deposits		122,596		2,312		1.89	%		216,436		134		0.06	%
Total interest earning assets	$	1,676,649	$	84,126		5.02	%	$	1,605,783	$	64,481		4.02	%
Other assets		67,380							79,357
Total assets	$	1,744,029						$	1,685,140
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits	$	85,566	$	601		0.70	%	$	67,897	$	229		0.34	%
Savings and NOW deposits		63,401		203		0.32	%		74,975		165		0.22	%
Money market deposit accounts		137,066		1,547		1.13	%		333,160		772		0.23	%
Time deposits		642,918		8,202		1.28	%		498,001		7,613		1.53	%
Total interest-bearing deposits	$	928,951	$	10,553		1.14	%	$	974,033	$	8,779		0.90	%
Federal funds and repos purchased		2		—		—			—		—		—
Subordinated debt		65,176		2,936		4.50	%		33,953		1,884		5.55	%
FHLB borrowings		23,986		347		1.45	%		—		—		—
Total interest-bearing liabilities	$	1,018,115	$	13,836		1.36	%	$	1,007,986	$	10,663		1.06	%
Demand deposits and other liabilities		535,075							498,031
Total liabilities	$	1,553,190						$	1,506,017
Stockholders' Equity		190,839							179,123
Total Liabilities and Stockholders' Equity	$	1,744,029						$	1,685,140
Interest Rate Spread						3.66	%						2.96	%
Net Interest Income			$	70,290						$	53,818
Net Interest Margin						4.19	%						3.35	%

(1)	Includes loans classified as non-accrual
(2)	Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs
(3)	Income and yields for all periods presented are reported on a tax-equivalent basis using the federal statutory rate of 21%
(4)	Refer to Appendix for reconciliation of non-GAAP measures

UNAUDITED SUMMARY FINANCIAL DATA (Dollars in thousands except per share data)
	At or For the Three Months Ended						At or For the Year Ended
	December 31,						December 31,
	2022			2021			2022			2021
*Per share Data and Shares Outstanding*
Earnings per common share (basic and diluted)	$	0.95		$	0.56		$	3.26		$	2.65
Book value per common share	$	22.98		$	21.27		$	22.98		$	21.27
Tangible book value per common share⁽²⁾	$	21.75		$	21.27		$	21.75		$	21.27
Weighted average common shares (basic and diluted)		7,433,607			7,595,062			7,529,259			7,595,781
Common shares outstanding at end of period		7,442,743			7,595,781			7,442,743			7,595,781
*Performance Ratios*
Return on average assets (annualized)		1.67	%		1.14	%		1.53	%		1.32	%
Return on average equity (annualized)		15.48	%		10.23	%		13.98	%		12.38	%
Return on average common equity (annualized)		16.72	%		10.63	%		14.99	%		13.18	%
Yield on earning assets (FTE) (2) (annualized)		5.88	%		4.07	%		5.02	%		4.02	%
Cost of interest bearing liabilities (annualized)		1.94	%		0.97	%		1.36	%		1.06	%
Net interest spread (FTE)⁽²⁾		3.94	%		3.10	%		3.66	%		2.96	%
Net interest margin (FTE)(2) (annualized)		4.70	%		3.49	%		4.19	%		3.35	%
Noninterest income as a percentage of average assets (annualized)		0.23	%		0.38	%		0.28	%		0.36	%
Noninterest expense to average assets (annualized)		2.36	%		2.07	%		2.24	%		1.95	%
Efficiency ratio⁽³⁾		49.45	%		56.31	%		52.19	%		55.10	%
*Asset Quality*
Commercial real estate loans to total capital ⁽⁴⁾		377.54	%		367.88	%		377.54	%		367.88	%
Construction loans to total capital ⁽⁵⁾		137.41	%		148.30	%		137.41	%		148.30	%
Loans 30-89 days past due to total gross loans		0.00	%		0.01	%		0.00	%		0.01	%
Loans 90 days past due to total gross loans		0.00	%		0.00	%		0.00	%		0.00	%
Non-accrual loans to total gross loans		0.00	%		0.00	%		0.00	%		0.00	%
Other real estate owned	$	—		$	775		$	—		$	775
Non-performing assets	$	—		$	775		$	—		$	775
Non-performing assets to total assets		0.00	%		0.05	%		0.00	%		0.05	%
Allowance for loan losses to total gross loans		0.88	%		0.86	%		0.88	%		0.86	%
Allowance for loan losses to non-performing assets		N/A			15.09			N/A			15.09
Net loan recoveries	$	2		$	26		$	19		$	5
Net charge-offs (recoveries) to average gross loans (annualized)		N/A			0.00	%		N/A			0.00	%
*Regulatory Capital Ratios (Bank only)* *⁽¹⁾*
Total risk-based capital ratio		0.00	%		16.06	%		0.00	%		16.06	%
Tier 1 risk-based capital ratio		0.00	%		15.23	%		0.00	%		15.23	%
Leverage ratio		0.00	%		15.23	%		0.00	%		15.23	%
Common equity tier 1 ratio		0.00	%		15.23	%		0.00	%		15.23	%
*Other information*
Closing stock price	$	27.49		$	24.59		$	27.49		$	24.59
Equity / assets		10.35	%		11.46	%		10.35	%		11.46	%
Average equity / average assets		10.80	%		11.16	%		10.94	%		10.63	%
Number of full time equivalent employees		168			138			168			138
# Full service branch offices		6			6			6			6

(1)	Regulatory capital ratios as of December 31, 2022 are preliminary
(2)	Refer to Appendix for reconciliation of non-GAAP measures
(3)	Efficiency ratio is calculated as non-interest expense as a percentage of net interest income and non-interest income
(4)	Commercial real estate includes only non-owner occupied and construction loans as a percentage of Bank capital
(5)	Construction loans as a percentage of Bank capital

Unaudited Reconciliation of Certain Non-GAAP Financial Measures (Dollars In thousands)
	For the three months ended December 31,						For the year ended December 31,
	2022			2021			2022			2021
Net interest margin (FTE)
Net interest income (GAAP)	$	20,596		$	13,866		$	70,009		$	53,536
FTE adjustment on tax-exempt securities		70			75			281			282
Net interest income (FTE) (non-GAAP)		20,666			13,941			70,290			53,818

Average interest earning assets		1,743,735			1,585,982			1,676,649			1,605,783
Net interest margin (GAAP)		4.69	%		3.47	%		4.18	%		3.33	%
Net interest margin (FTE) (non-GAAP)		4.70	%		3.49	%		4.19	%		3.35	%

	For the three months ended December 31,				For the year ended December 31,
	2022		2021		2022		2021
Stockholders equity, adjusted
Total stockholders equity (GAAP)	$	198,282	$	188,788	$	198,282	$	188,788
Less: preferred stock		(27,263)		(27,263)		(27,263)		(27,263)
Total common stockholders equity (GAAP)		171,019		161,525	$	171,019	$	161,525
Less: intangible assets		9,149		2,493		9,149		2,493
Tangible common stockholders equity (non-GAAP)		161,870		159,032		161,870		159,032

Shares outstanding		7,442,743		7,595,781		7,442,743		7,595,781
Tangible book value per common share (non-GAAP)	$	21.75	$	20.94	$	21.75	$	20.94

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SOURCE MainStreet Bancshares, Inc.