EX-99.1 2 tm2113725d1_ex99-1.htm EXHIBIT 99.1

 

Exhibit 99.1

 

 

 

212-365-6721

IR@MetropolitanBankNY.com

 

Metropolitan Bank Holding Corp. Reports Net Income

of $12 Million and Diluted EPS of $1.43 for the First Quarter

 

vNet income of $12 million for second sequential quarter sets the stage for robust earnings growth for 2021
   
vContinued strong momentum in core deposit growth, up 16% from year-end 2020, provides sustainable funding for increased loan production

 

NEW YORK, April 21, 2021 – Metropolitan Bank Holding Corp. (the “Company”) (NYSE: MCB), the holding company for Metropolitan Commercial Bank (the “Bank”), today reported net income of $12.1 million, or $1.43 per diluted common share, for the first quarter of 2021 compared to net income of $6.1 million, or $0.72 per diluted common share, for the first quarter of 2020.

 

Financial Highlights include:

 

·First quarter net income of $12.1 million, up 98.7% from the prior year quarter, and earnings per share of $1.43 per share up 98.6% over same period.

 

·Annualized return on average equity of 14.17% and an annualized return on average tangible common equity* of 14.82%.

 

·Total revenues** of $39.0 million, up 17.1% from the prior year period and 5.9% from the linked quarter, reflecting continued strength from market positioning of our core franchise.

 

·Total assets were up 13.7% from the linked quarter with net loan growth of $100.6 million, reflecting a 12.8% annualized pace, on quarterly loan production of $235.7 million.

 

·Deposits were up 15.6% from year-end 2020, driven by an increase of $441.8 million in non-interest-bearing deposits; non-interest-bearing deposits were 49.0% of total deposits at quarter-end, from 45.1% at year-end 2020.

 

·Total average cost of funds decreased by 1 basis point from the linked quarter to 35 basis points. Annualized net interest margin of 3.00% was down 21 basis points during the same period, primarily due to strong core deposit growth driving increased overnight liquidity.

 

* Non-GAAP financial measure. See Reconciliation of Non-GAAP measures on page 12.

**Total revenues equals the sum of net interest income and non-interest income.

 

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·Asset quality remained strong with non-performing loans at 17 basis points of total loans, down 3 basis points from the linked quarter. Loan loss provision of $950,000 in the quarter was commensurate with net loan growth.

 

·Full payment deferrals related to the Coronavirus pandemic (“COVID-19”) were $27.9 million, or 0.9% of the total loan portfolio as of March 31, 2021, while principal-only payment deferrals were $37.4 million, or 1.2% of the total loan portfolio at the same date.

 

·Non-interest expenses were $20.3 million, up 4.1% compared to the first quarter of 2020. The efficiency ratio was 52.1%, as compared to 58.6% for the first quarter of 2020.

 

Mark R. DeFazio, President and Chief Executive Officer commented, “MCB’s unwavering focus transformed the unprecedented challenges of 2020 into a record year and a launching pad for 2021. I am very pleased with our first quarter results. Our momentum has set the stage for a strong, efficient balance sheet build which will allow for sustainable earnings for years to come. Our core funding strategies continue to generate low cost, stable liquidity to fund our organic loan growth. Loan yields, together with low-cost funding, will maintain our margin management discipline. Asset quality continues to perform as it has over the past 20 + years of organic growth. As reported, pandemic-related loan deferrals are winding down with no evidence of loss to date.

 

“The markets in which we do business are reopening, and we are seeing a positive trend of new business activity, especially in New York City. While we operate in diverse markets, we are very confident in our exposure in Manhattan and in the greater New York area. A benefit of our organic loan production platform is the direct communication with our clients, allowing us to discuss both challenges and opportunities as they evolve in the marketplace. This platform places MCB in the best position to address challenges quickly and to assist our clients in taking advantage of the opportunities.

 

“I am also very encouraged by the sustained performance of our Global Payments Group. As our fintech clients continue to take market share from banks, we are well positioned to continue to provide the requisite financial infrastructure to support their growth. We are very confident in GPG’s ability as a global payment settlement provider to contribute low-cost funding and non-interest income in a very scalable and efficient manner.

 

Lastly, I want to thank our staff and board of directors for their dedication to MCB and our clients. I would also like to thank our clients, who have been very active and have demonstrated their support for MCB’s sustained success over the past 20 years,” Mr. DeFazio concluded.

 

Balance Sheet

 

The Company had total assets of $4.92 billion at March 31, 2021, an increase of 13.7% from December 31, 2020. Total loans before deferred fees increased to $3.24 billion at March 31, 2021, as compared to $3.14 billion at December 31, 2020. The increase in total loans from December 31, 2020 was due primarily to an increase of $114.6 million in commercial real estate (“CRE”) loans, including construction and multifamily loans, offset by net paydowns and amortization of $4.9 million in 1-4 family loans, $4.5 million in consumer loans and $4.4 million in commercial and industrial (“C&I”) loans. For the first quarter of 2021, the Bank’s loan production was $235.7 million, as compared to $174.0 million and $152.6 for the linked quarter and the first quarter of 2020, respectively.

 

Total cash and cash equivalents was $1.14 billion at March 31, 2021, an increase of 31.3% from December 31, 2020. The increase in cash and cash equivalents reflect the strong growth in deposits of $597.1 million that exceeded growth in loans of $100.6 million for the first quarter of 2021. Total securities, primarily those classified as available-for-sale (“AFS”), was $484.8 million at March 31, 2021, an increase of 78.8% from December 31, 2020.

 

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Total deposits increased to $4.43 billion at March 31, 2021, up 15.6% from $3.83 billion at December 31, 2020. The increase in deposits for the first quarter of 2021 was due to increases of $441.8 million in non-interest-bearing deposits and $155.3 million in interest-bearing deposits, resulting from increases across most deposit verticals. Non-interest-bearing deposits were 49.0% of total deposits at March 31, 2021, as compared to 45.1% at December 31, 2020.

 

The Company and the Bank each meet all the requirements to be considered “Well-Capitalized” under applicable regulatory guidelines. Total non-owner-occupied commercial real estate loans were 426.5% and 412.5% of total risk-based capital at March 31, 2021 and December 31, 2020, respectively.

 

Income Statement

 

Financial Highlights

 

   Three months ended March 31,   Three months ended
December  31,		 
   2021   2020   2020 
Total Revenues  $39,017   $33,309   $36,840 
Net income   12,117    6,097    11,775 
Diluted earnings per common share   1.43    0.72    1.39 
Annualized return on average assets   1.05%   0.71%   1.13%
Annualized return on average equity   14.17%   8.00%   13.94%
Annualized return on average tangible common equity*   14.82%   8.33%   14.61%

 

*Non-GAAP financial measure. See Reconciliation of Non-GAAP measures on page 12.

 

Net Interest Income

 

Net interest income for the first quarter of 2021 was $34.4 million, an increase of $955,000 from the linked quarter. This increase was primarily due to a higher average balance of $4.63 billion in interest-earning assets for the first quarter of 2021, which increased $511.1 million from the linked quarter, partially offset by an increase of $88.6 million in average interest-bearing liabilities, which were $2.19 billion for the first quarter of 2021, as compared to $2.10 billion for the linked quarter.

 

Net interest income increased $5.4 million for first quarter of 2021, as compared to the first quarter of 2020, primarily due to an increase of $1.21 billion in the average balance of interest-earning assets for the first quarter of 2021, as compared to the first quarter of 2020. This was partially offset by a $259.1 million increase in the average balance of interest-bearing liabilities for the first quarter of 2021, as compared to the first quarter of 2020.

 

Net Interest Margin

 

Net interest margin decreased by 21 basis points to 3.00% for the first quarter of 2021, as compared to 3.21% for the linked quarter, primarily due to increased overnight deposits driven by strong deposit growth. Additionally, the average cost of interest-bearing deposits increased by 4 basis points to 0.60% for the first quarter of 2021, as compared to 0.56% for the linked quarter, primarily due to an increase in reciprocal sweep deposits.

 

Net interest margin decreased by 38 basis points for the first quarter of 2021 as compared to 3.38% for the first quarter of 2020, primarily due to increased overnight deposits driven by deposit growth; partially offset by a decrease in the average cost of interest-bearing liabilities driven by the lower rate environment.

 

Non-Interest Income

 

Non-interest income was $4.6 million for the first quarter of 2021, an increase of $1.2 million from the linked quarter driven primarily by Global Payments Group, which continues to see strong increases in client transaction volumes driving revenue growth along with contractual fee recognition, which represented approximately 15% of non-interest income in the first quarter of 2021.

 

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Non-interest income for the first quarter of 2021 increased slightly by $255,000, as compared to the first quarter of 2020. The increase was primarily due to an increase of $1.6 million of global payments revenue, partially offset by a gain of $975,000 recognized on sale of AFS securities in the first quarter of 2020.

 

Non-Interest Expense

 

Non-interest expense was $20.3 million for the first quarter of 2021, an increase of $2.5 million from the linked quarter. The primary driver was a $1.6 million increase in compensation and benefits expense, of which approximately $1.3 million was related to elevated first quarter employer expenses, including FICA expense and severance costs.

 

Non-interest expense increased $807,000 for the first quarter of 2021, as compared to the first quarter of 2020. Drivers included an increase in compensation and benefits cost due to addition of 21 full-time employees along with annual salary adjustments and increases in other expenses in line with business expansion, partially offset by a reduction in premises and equipment related to completion of the corporate office move and reduced licensing fees given the LIBOR rate reduction.

 

Asset Quality

 

Non-performing loans were $5.5 million at March 31, 2021, a decrease of $925,000 from December 31, 2020. The decrease was primarily due to the charge-off of two C&I loans in the amount of $855,000, all of which was reserved for at December 31, 2020. The Bank’s ratio of non-performing loans to total loans was 0.17% at March 31, 2021.

 

The provision for loan losses for the first quarter of 2021 was $950,000, a decrease of $845,000 from the linked quarter. This was primarily due to lower net loan growth in the first quarter of 2021, as compared to the linked quarter, as well as higher specific reserves recorded in the linked quarter for certain C&I and consumer loans.

 

(dollars in thousands)  March 31, 2021   December 31, 2020 
Non-performing loans:          
Non-accrual loans:          
Commercial and industrial   3,337    4,192 
Consumer   1,523    1,428 
Total non-accrual loans  $4,860   $5,620 
Accruing loans 90 days or more past due   604    769 
Total non-performing loans  $5,464   $6,389 
Non-accrual loans as % of loans outstanding   0.15%   0.18%
Non-performing loans as % of loans outstanding   0.17%   0.20%
Allowance for loan losses  $(35,502)  $(35,407)
Allowance for loan losses as % of loans outstanding   1.10%   1.13%

 

   Three months ended 
(dollars in thousands)  March 31, 2021   December 31, 2020 
Provision for loan losses  $950   $1,795 
Charge-offs  $(855)  $(30)
Recoveries  $—   $28 
Net charge-offs/(recoveries) as % of average loans (annualized)   0.11%   0.00%

 

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About Metropolitan Bank Holding Corporation

 

Metropolitan Bank Holding Corp. (NYSE: MCB) is the holding company for Metropolitan Commercial Bank. The Bank provides a broad range of business, commercial and personal banking products and services to small and middle-market businesses, public entities and affluent individuals in the New York metropolitan area. Founded in 1999, the Bank is headquartered in New York City and operates six locations in Manhattan, Brooklyn and Great Neck, Long Island. The Bank is also an active issuer of debit cards for third-party debit card programs and provides critical global payments infrastructure to its FinTech partners. Metropolitan Commercial Bank is a New York State chartered commercial bank and a Federal Reserve System member bank whose deposits are insured up to applicable limits by the FDIC, and an equal opportunity lender. For more information, please visit www.mcbankny.com.

 

Forward Looking Statement Disclaimer

 

This release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Examples of forward-looking statements include but are not limited to the Company’s financial condition and capital ratios, results of operations and the Company’s outlook and business. Forward-looking statements are not historical facts. Such statements may be identified by the use of such words as “may,” “believe,” “expect,” “anticipate,” “plan,” “continue” or similar terminology. These statements relate to future events or our future financial performance and involve risks and uncertainties that may cause our actual results, levels of activity, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we caution you not to place undue reliance on these forward-looking statements. Factors which may cause our forward-looking statements to be materially inaccurate include, but are not limited to an unexpected deterioration in our loan portfolio, unexpected increases in our expenses, greater than anticipated growth and our ability to manage such growth, unanticipated regulatory action, unexpected changes in interest rates, an unanticipated decrease in deposits, an unanticipated loss of key personnel, an unanticipated loss of existing customers, competition from other institutions resulting in unanticipated changes in our loan or deposit rates, unanticipated increases in Federal Deposit Insurance Corporation costs, changes in regulations, legislation or accounting rules and unanticipated adverse changes in our customers’ economic conditions or economic conditions in our local area in general, as well as those discussed under the heading “Risk Factors” in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

 

Further, given its ongoing and dynamic nature, it is difficult to predict the full impact of the COVID-19 outbreak on our business. The extent of such impact will depend on future developments, which are highly uncertain, including when the coronavirus can be controlled and abated and when and whether the continued reopening of businesses will result in a meaningful increase in economic activity. As the result of the COVID-19 pandemic and the related adverse local and national economic consequences, we could be subject to any of the following risks, any of which could have a material, adverse effect on our business, financial condition, liquidity, and results of operations: the demand for our products and services may decline, making it difficult to grow assets and income; if the economy is unable to substantially reopen, and higher levels of unemployment continue for an extended period of time, loan delinquencies, problem assets, and foreclosures may increase, resulting in increased charges and reduced income; collateral for loans, especially real estate, may decline in value, which could cause loan losses to increase; our allowance for loan losses may increase if borrowers experience financial difficulties, which will adversely affect our net income; the net worth and liquidity of loan guarantors may decline, impairing their ability to honor commitments to us; our cyber security risks may increase if a significant number of our employees are forced to working remotely; and FDIC premiums may increase if the agency experiences additional resolution costs.

 

Forward-looking statements speak only as of the date of this release. We do not undertake any obligation to update or revise any forward-looking statement.

 

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Consolidated Balance Sheet

 

(Dollars in thousands)  March 31, 2021   December 31, 2020 
Assets          
Cash and due from banks  $9,432   $8,692 
Overnight deposits   1,125,589    855,613 
Total cash and cash equivalents   1,135,021    864,305 
Investment securities available for sale   479,988    266,096 
Investment securities held to maturity   2,492    2,760 
Investment securities -- Equity investments   2,281    2,313 
Total securities   484,761    271,169 
Other investments   11,638    11,597 
Loans, net of deferred fees and unamortized costs   3,237,664    3,137,053 
Allowance for loan losses   (35,502)   (35,407)
Net loans   3,202,162    3,101,646 
Receivable from prepaid card programs, net   38,356    27,259 
Accrued interest receivable   13,982    13,249 
Premises and equipment, net   13,756    13,475 
Prepaid expenses and other assets   13,392    18,388 
Goodwill   9,733    9,733 
Total assets  $4,922,801   $4,330,821 
Liabilities and Stockholders' Equity          
Deposits:          
Non-interest-bearing demand deposits  $2,167,899   $1,726,135 
Interest-bearing deposits   2,258,818    2,103,471 
Total deposits   4,426,717    3,829,606 
Federal Home Loan Bank of New York advances   —    — 
Trust preferred securities   20,620    20,620 
Subordinated debt, net of issuance cost   24,670    24,657 
Secured Borrowings   36,475    36,964 
Accounts payable, accrued expenses and other liabilities   42,737    61,645 
Accrued interest payable   563    712 
Prepaid third-party debit cardholder balances   22,802    15,830 
Total liabilities   4,574,584    3,990,034 
           
Class B preferred stock   3    3 
Common stock   83    82 
Additional paid in capital   217,384    218,899 
Retained earnings   132,947    120,830 
Accumulated other comprehensive gain, net of tax effect   (2,200)   973 
Total stockholders’ equity   348,217    340,787 
Total liabilities and stockholders’ equity  $4,922,801   $4,330,821 

 

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Consolidated Statement of Income (unaudited)

 

   Quarter ended Mar. 31,   Quarter ended Dec. 31, 
(dollars in thousands, except per share data)  2021   2020   2020 
Total interest income  $38,106   $36,067   $36,862 
Total interest expense   3,684    7,098    3,395 
Net interest income   34,422    28,969    33,467 
Provision for loan losses   950    4,790    1,795 
Net interest income after provision for loan losses   33,472    24,179    31,672 
                
Non-interest income:               
Service charges on deposit accounts   1,065    1,081    981 
Global payments revenue   3,267    1,621    2,163 
Other service charges and fees   304    627    236 
Unrealized (loss) gain on equity securities   (41)   36    (7)
Gain on sale of securities   —    975    — 
Total non-interest income   4,595    4,340    3,373 
                
Non-interest expense:               
Compensation and benefits   11,428    9,960    9,835 
Bank premises and equipment   2,024    2,500    1,842 
Professional fees   1,304    955    1,064 
Licensing fees and technology costs   3,001    3,806    2,814 
Other expenses   2,566    2,295    2,233 
Total non-interest expense   20,323    19,516    17,788 
                
Net income before income tax expense   17,744    9,003    17,257 
Income tax expense   5,627    2,906    5,482 
Net income  $12,117   $6,097   $11,775 
                
Earnings per common share:               
Average common shares outstanding - basic   8,276,174    8,215,959    8,225,083 
Average common shares outstanding - diluted   8,417,319    8,412,782    8,417,729 
Basic earnings  $1.46   $0.73   $1.42 
Diluted earnings  $1.43   $0.72   $1.39 

 

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Net Interest Margin Analysis

 

   Three months ended 
   March 31, 2021   December 31, 2020 
   Average           Average         
   Outstanding       Yield/Rate   Outstanding       Yield/Rate 
(dollars in thousands)  Balance   Interest   (annualized)   Balance   Interest   (annualized) 
Assets:                              
Interest-earning assets:                              
Loans (1)  $3,187,450   $36,840    4.67%  $3,070,850   $35,843    4.62%
Available-for-sale securities   330,451    752    0.91%   230,080    573    0.97%
Held-to-maturity securities   2,623    11    1.71%   2,906    12    1.65%
Equity investments - non-trading   2,302    8    1.39%   2,294    9    1.46%
Overnight deposits   1,100,690    344    0.13%   806,602    280    0.14%
Other interest-earning assets   11,610    151    5.27%   11,336    145    5.09%
Total interest-earning assets   4,635,126    38,106    3.32%   4,124,068    36,862    3.54%
Non-interest-earning assets   69,894              63,962           
Allowance for loan and lease losses   (35,969)             (34,122)          
Total assets  $4,669,051             $4,153,908           
                               
Liabilities and Stockholders' Equity:                              
Interest-bearing liabilities:                              
Money market, savings and other interest-bearing accounts  $2,058,611   $2,907    0.57%  $1,962,417   $2,554    0.52%
Certificates of deposit   86,902    264    1.23%   94,546    327    1.38%
Total interest-bearing deposits   2,145,513    3,171    0.60%   2,056,963    2,881    0.56%
Borrowed funds   45,282    513    4.53%   45,268    514    4.44%
Total interest-bearing liabilities   2,190,795    3,684    0.68%   2,102,231    3,395    0.64%
Non-interest-bearing liabilities:                              
Non-interest-bearing deposits   2,067,539              1,636,417           
Other non-interest-bearing liabilities   63,932              79,320           
Total liabilities   4,322,266              3,817,968           
                               
Stockholders' Equity   346,785              335,940           
Total liabilities and equity  $4,669,051             $4,153,908           
                               
Net interest income       $34,422             $33,467      
Net interest rate spread (2)             2.64%             2.90%
Net interest-earning assets  $2,444,331             $2,021,837           
Net interest margin (3)             3.00%             3.21%
Total cost of funds (4)             0.35%             0.36%

 

 

(1)Amount includes deferred loan fees and non-performing loans.
(2)Determined by subtracting the annualized weighted average cost of total interest-bearing liabilities from the annualized weighted average yield on total interest-earning assets.
(3)Determined by dividing annualized net interest income by total average interest-earning assets.
(4)Determined by dividing annualized interest expense by the sum of total average interest-bearing liabilities and total average non-interest-bearing deposits.

 

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   Three months ended 
   March 31, 2021   March 31, 2020 
   Average           Average         
   Outstanding       Yield/Rate   Outstanding       Yield/Rate 
(dollars in thousands)  Balance   Interest   (annualized)   Balance   Interest   (annualized) 
Assets:                              
Interest-earning assets:                              
Loans (1)  $3,187,450   $36,840    4.67%  $2,705,710   $32,827    4.85%
Available-for-sale securities   330,451    752    0.91%   219,883    1,343    2.42%
Held-to-maturity securities   2,623    11    1.71%   3,622    17    1.86%
Equity investments - non-trading   2,302    8    1.39%   2,263    12    2.10%
Overnight deposits   1,100,690    344    0.13%   470,638    1,593    1.36%
Other interest-earning assets   11,610    151    5.27%   21,441    275    5.07%
Total interest-earning assets   4,635,126    38,106    3.32%   3,423,557    36,067    4.22%
Non-interest-earning assets   69,894              57,567           
Allowance for loan and lease losses   (35,969)             (26,789)          
Total assets  $4,669,051             $3,454,335           
                               
Liabilities and Stockholders' Equity:                              
Interest-bearing liabilities:                              
Money market, savings and other interest-bearing accounts  $2,058,611   $2,907    0.57%  $1,638,362   $5,171    1.27%
Certificates of deposit   86,902    264    1.23%   104,067    596    2.30%
Total interest-bearing deposits   2,145,513    3,171    0.60%   1,742,429    5,767    1.33%
Borrowed funds   45,282    513    4.53%   189,226    1,331    2.78%
Total interest-bearing liabilities   2,190,795    3,684    0.68%   1,931,655    7,098    1.48%
Non-interest-bearing liabilities:                              
Non-interest-bearing deposits   2,067,539              1,157,270           
Other non-interest-bearing liabilities   63,932              58,923           
Total liabilities   4,322,266              3,147,848           
                               
Stockholders' Equity   346,785              306,487           
Total liabilities and equity  $4,669,051             $3,454,335           
                               
Net interest income       $34,422             $28,969      
Net interest rate spread (2)             2.64%             2.74%
Net interest-earning assets  $2,444,331             $1,491,902           
Net interest margin (3)             3.00%             3.38%
Total cost of funds (4)             0.35%             0.92%

 

 

(1)Amount includes deferred loan fees and non-performing loans.
(2)Determined by subtracting the annualized weighted average cost of total interest-bearing liabilities from the annualized weighted average yield on total interest-earning assets.
(3)Determined by dividing annualized net interest income by total average interest-earning assets.
(4)Determined by dividing annualized interest expense by the sum of total average interest-bearing liabilities and total average non-interest-bearing deposits.

 

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Summary of Income and Performance Measures

Five Quarter Trend (unaudited)

 

   Quarter Ended 
(Dollars in thousands)  Mar. 31, 2021   Dec. 31, 2020   Sept. 30, 2020   June 30, 2020   Mar. 31, 2020 
Net interest income  $34,422   $33,467   $32,324   $30,161   $28,969 
Provision for loan losses   950    1,795    1,137    1,766    4,790 
Net interest income after provision for loan losses   33,472    31,672    31,187    28,395    24,179 
Non-interest income   4,595    3,373    3,637    5,653    4,340 
Non-interest expense:                         
Compensation and benefits   11,428    9,835    9,944    10,058    9,960 
Other Expense   8,895    7,953    8,986    8,226    9,556 
Total non-interest expense   20,323    17,788    18,930    18,284    19,516 
                          
Income before income tax expense   17,744    17,257    15,894    15,764    9,003 
Income tax expense   5,627    5,482    5,111    4,953    2,906 
Net income   12,117    11,775    10,783    10,811    6,097 
                          
Pre-tax, pre-provision income*  $18,694   $19,052   $17,031   $17,530   $13,793 
                          
Performance Measures:                         
Net income available to common shareholders   12,062    11,690    10,694    10,716    6,032 
Per common share:                         
Basic earnings  $1.46   $1.42   $1.30   $1.30   $0.73 
Diluted earnings  $1.43   $1.39   $1.27   $1.28   $0.72 
Common shares outstanding:                         
Average - diluted   8,417,319    8,417,729    8,393,211    8,359,450    8,412,782 
Period end   8,345,032    8,295,272    8,289,479    8,294,801    8,294,801 
Return on (annualized):                         
Average total assets   1.05%   1.13%   1.07%   1.14%   0.71%
Average equity   14.17%   13.94%   13.20%   13.82%   8.00%
Average tangible common equity*   14.82%   14.61%   13.85%   14.36%   8.33%
Yield on average earning assets   3.32%   3.54%   3.54%   3.62%   4.22%
Cost of interest-bearing liabilities   0.68%   0.64%   0.71%   0.81%   1.48%
Net interest spread   2.64%   2.90%   2.83%   2.81%   2.74%
Net interest margin   3.00%   3.21%   3.18%   3.19%   3.38%
Net charge-offs as % of average loans (annualized)   0.11%   0.00%   0.00%   0.03%   0.02%
Efficiency ratio   52.09%   48.28%   52.64%   54.58%   58.59%

 

*Non-GAAP financial measure. See Reconciliation of Non-GAAP measures on page 12.

 

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Consolidated Balance Sheet Summary, Five Quarter Trend (unaudited)

 

(dollars in thousands)  Mar. 31, 2021   Dec. 31, 2020   Sept. 30, 2020   June 30, 2020   Mar. 31, 2020 
Assets                         
Total Assets  $4,922,801   $4,330,821   $4,001,759   $3,970,441   $3,612,012 
Overnight deposits   1,125,589    855,613    758,913    813,147    569,927 
Total securities   484,761    271,169    187,695    194,979    205,646 
Other investments   11,638    11,597    11,097    15,731    21,455 
Loans, net of deferred fees and unamortized costs   3,237,664    3,137,053    2,989,550    2,892,274    2,766,099 
                          
Liabilities and Stockholders' Equity                         
Deposits:                         
Non-interest-bearing demand deposits  $2,167,899   $1,726,135   $1,561,605   $1,535,245   $1,254,089 
Interest-bearing deposits   2,258,818    2,103,471    1,974,385    1,868,300    1,771,108 
Total deposits   4,426,717    3,829,606    3,535,990    3,403,545    3,025,197 
Borrowings   45,290    45,277    45,263    149,249    189,235 
Total stockholders' Equity   348,217    340,787    328,584    317,169    308,536 
                          
Asset Quality                         
Total non-accrual loans  $4,860   $5,620   $5,669   $7,083   $6,136 
Total non-performing loans  $5,464   $6,389   $6,623   $8,448   $6,341 
Non-accrual loans to total loans   0.15%   0.18%   0.19%   0.24%   0.22%
Non-performing loans to total loans   0.17%   0.20%   0.22%   0.29%   0.23%
Allowance for loan losses   (35,502)   (35,407)   (33,614)   (32,505)   (30,924)
Allowance for loan losses to total loans   1.10%   1.13%   1.12%   1.12%   1.12%
Provision for loan losses   950    1,795    1,137    1,766    4,790 
Net charge-offs   855    2    28    185    138 
                          
Regulatory Capital                         
Tier 1 Leverage:                         
Metropolitan Bank Holding Corp.   7.8%   8.5%   8.4%   8.6%   9.1%
Metropolitan Commercial Bank   8.2%   9.0%   9.0%   9.2%   9.8%
                          
Common Equity Tier 1 Risk-Based (CET1):                         
Metropolitan Bank Holding Corp.   9.9%   10.1%   10.1%   9.9%   9.8%
Metropolitan Commercial Bank   11.3%   11.6%   11.8%   11.6%   11.5%
                          
Tier 1 Risk-Based:                         
Metropolitan Bank Holding Corp.   10.7%   10.9%   11.0%   10.8%   10.7%
Metropolitan Commercial Bank   11.3%   11.6%   11.8%   11.6%   11.5%
                          
Total Risk-Based:                         
Metropolitan Bank Holding Corp.   12.4%   12.7%   12.9%   12.7%   12.1%
Metropolitan Commercial Bank   12.4%   12.7%   12.9%   12.6%   12.5%

 

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Reconciliation of Non-GAAP Measures

 

In addition to the results presented in accordance with Generally Accepted Accounting Principles ("GAAP"), this earnings release includes certain non-GAAP financial measures. Management believes these non-GAAP financial measures provide meaningful information to investors in understanding the Company’s operating performance and trends. These non-GAAP measures have inherent limitations and are not required to be uniformly applied and are not audited. They should not be considered in isolation or as a substitute for an analysis of results reported under GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies. Reconciliations of non-GAAP/adjusted financial measures disclosed in this earnings release to the comparable GAAP measures are provided in the following table:

 

   Quarterly Data 
Dollars in thousands, except per share data  Mar. 31, 2021   Dec. 31, 2020   Sept. 30, 2020   June 30, 2020   Mar. 31, 2020 
                          
Average assets  $4,669,051   $4,153,908   $4,026,366   $3,812,225   $3,454,335 
Less: average intangible assets   9,733    9,733    9,733    9,733    9,733 
Average tangible assets  $4,659,318   $4,144,175   $4,016,633   $3,802,492   $3,444,602 
                          
Average equity  $346,785   $335,940   $324,876   $314,727   $306,487 
Less: Average preferred equity   5,502    5,502    5,502    5,502    5,502 
Average common equity  $341,283   $330,438   $319,374   $309,225   $300,985 
Less: average intangible assets   9,733    9,733    9,733    9,733    9,733 
Average tangible common equity  $331,550   $320,705   $309,641   $299,492   $291,252 
                          
Total assets  $4,922,801   $4,330,821   $4,001,759   $3,970,441   $3,612,012 
Less: intangible assets   9,733    9,733    9,733    9,733    9,733 
Tangible assets  $4,913,068   $4,321,088   $3,992,026   $3,960,708   $3,602,279 
                          
Total Equity  $348,217   $340,787   $328,584   $317,169   $308,536 
Less: preferred equity   5,502    5,502    5,502    5,502    5,502 
Common Equity  $342,715   $335,285   $323,082   $311,667   $303,034 
Less: intangible assets   9,733    9,733    9,733    9,733    9,733 
Tangible common equity (book value)  $332,982   $325,552   $313,349   $301,934   $293,301 
                          
Common shares outstanding   8,345,032    8,295,272    8,289,479    8,294,801    8,294,801 
                          
Book value per share (GAAP)  $41.07   $40.42   $38.97   $37.57   $36.53 
Tangible book value per share (non-GAAP)*  $39.90   $39.25   $37.80   $36.40   $35.36 

 

 

* Tangible book value divided by common shares outstanding at period-end.

 

   Quarterly Data 
Dollars in thousands  Mar. 31, 2021   Dec. 31, 2020   Sept. 30, 2020   June 30, 2020   Mar. 31, 2020 
                          
Net income  $12,117   $11,775   $10,783   $10,811   $6,097 
Plus: income tax expense   5,627    5,482    5,111    4,953    2,906 
Income before income tax expense  $17,744   $17,257   $15,894   $15,764   $9,003 
Plus: provision for loan losses   950    1,795    1,137    1,766    4,790 
Pre-tax, pre-provision income  $18,694   $19,052   $17,031   $17,530   $13,793 

 

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