Stable performance demonstrates MCB’s
ability to execute on its business plan in a challenging economic
environment
Financial Highlights
- Total deposits at December 31, 2023 were $5.7 billion, an
increase of $215.7 million from September 30, 2023 and an increase
of $459.4 million from December 31, 2022.
- Net loans at December 31, 2023 were $5.6 billion, with strong
growth of $270.3 million from September 30, 2023 and $784.3 million
from December 31, 2022.
- Asset quality remains strong.
- Net interest margin for the fourth quarter of 2023 increased to
3.36% compared to 3.27% for the prior linked quarter. Full year
2023 net interest margin of 3.49%, consistent with prior year.
- Full year 2023 return on average equity of 12.4% and return on
average tangible common equity1 of 12.6%.
- Liquidity remains strong. At December 31, 2023, cash on deposit
with the Federal Reserve Bank of New York and available secured
funding capacity totaled $3.1 billion, which was 196.3% of
uninsured deposit balances.
- The Company and Bank are “well capitalized” across all measures
of regulatory capital, with total risk-based capital ratios of
12.8% and 12.5%, respectively, at December 31, 2023, well above
regulatory minimums.
1 Non-GAAP financial measure. See Reconciliation of Non-GAAP
Measures on page 13.
Metropolitan Bank Holding Corp. (the “Company”) (NYSE: MCB), the
holding company for Metropolitan Commercial Bank (the “Bank”),
reported net income of $14.6 million, or $1.28 per diluted common
share, for the fourth quarter of 2023 compared to a net loss of
$7.7 million, or $0.71 per diluted common share, for the fourth
quarter of 20222. Net income for the year 2023 was $77.3 million,
or $6.91 per diluted common share, compared to net income of $59.4
million, or $5.29 per diluted common share, for the year 20222.
2 The fourth quarter and full year 2022 results include a $35.0
million regulatory settlement reserve. The full year 2023 results
include a $5.5 million reversal of the regulatory settlement
reserve.
Mark DeFazio, President and Chief Executive Officer,
commented,
“I am pleased with our performance in 2023. MCB delivered
responsible loan growth predominantly funded by core deposits,
which was impressive in light of the challenging economic backdrop,
persistent inflation, higher interest rates and our exit from the
crypto business. We maintain our disciplined approach to lending
and remain focused on prudent balance sheet management and
liquidity. Our ability to grow appropriately within this
environment demonstrates the strength and stability of our
franchise.
“As we enter 2024, MCB is well-positioned to grow our business
and drive EPS growth while supporting the needs of our
clients.”
Balance Sheet
Total cash and cash equivalents were $269.5 million at December
31, 2023, an increase of $92.1 million, or 51.9%, from September
30, 2023 and an increase of $12.0 million from December 31, 2022.
The increase from September 30, 2023, primarily reflected the
$215.7 million and $184.0 million increase in deposits and
wholesale funding, respectively, partially offset by the $270.3
million net deployment into loans.
Total loans, net of deferred fees and unamortized costs, were
$5.6 billion, an increase of $270.3 million, or 5.0%, from
September 30, 2023, and an increase of $784.3 million, or 16.2%,
from December 31, 2022. Loan production was $342.5 million for the
fourth quarter of 2023 compared to $333.5 million for the prior
linked quarter and $411.3 million for the prior year period. The
increase in total loans from September 30, 2023, was due primarily
to an increase of $145.0 million in commercial real estate (“CRE”)
loans (including owner-occupied) and $74.7 million in commercial
and industrial (C&I) loans. The increase in total loans from
December 31, 2022, was due primarily to an increase of $603.2
million in CRE loans (including owner-occupied) and $142.8 million
in C&I loans.
Total deposits were $5.7 billion at December 31, 2023, an
increase of $215.7 million, or 3.9% from September 30, 2023, and an
increase of $459.4 million or 8.7% from December 31, 2022. The
increase from September 30, 2023, was due primarily to an increase
of $140.7 million in municipal deposits and $36.5 million in retail
deposits. The increase in deposits from December 31, 2022, was due
primarily to an increase of $749.2 million in retail deposits and
$229.1 million in EB-5, Title and Escrow and Charter School
deposits, partially offset by the $491.0 million decrease in
crypto-related deposits. Non-interest-bearing demand deposits were
32.0% of total deposits at December 31, 2023, compared to 31.6% at
September 30, 2023 and 45.9% at December 31, 2022. The decline from
December 31, 2022 primarily reflects the outflow of crypto-related
deposits.
Accumulated other comprehensive loss, net of tax, was $52.9
million, a decrease of $7.2 million, from September 30, 2023, and
$1.4 million from December 31, 2022. The decreases from September
30, 2023 and December 31, 2022 were due to decreases in unrealized
losses on available-for-sale securities due to changes in
prevailing market interest rates, partially offset by unrealized
losses and reclassification adjustments to net income on cash flow
hedges.
At December 31, 2023, cash on deposit with the Federal Reserve
Bank of New York and available secured funding capacity totaled
$3.1 billion. The Company and the Bank each met all the
requirements to be considered “Well-Capitalized” under applicable
regulatory guidelines. Total non-owner-occupied commercial real
estate loans were 368.1% of total risk-based capital at December
31, 2023, compared to 374.8% and 366.0% at September 30, 2023 and
December 31, 2022, respectively.
Income Statement
Financial Highlights
Three months ended
Year ended
Dec. 31,
Sept. 30,
Dec. 31,
Dec. 31,
Dec. 31,
(dollars in thousands, except per share
data)
2023
2023(1)
2022(2)
2023(3)
2022(2)
Total revenues(4)
$
63,555
$
60,070
$
70,249
$
250,739
$
255,751
Net income (loss)
14,568
22,063
(7,740)
77,268
59,425
Diluted earnings (loss) per common
share
1.28
1.97
(0.71)
6.91
5.29
Return on average assets(5)
0.84
%
1.33
%
N.M.
%
1.19
%
0.90
%
Return on average equity(5)
9.0
%
13.9
%
N.M.
%
12.4
%
10.3
%
Return on average tangible common
equity(5), (6)
9.1
%
14.1
%
N.M.
%
12.6
%
10.4
%
__________________ (1) Includes a $3.0 million reversal of the
regulatory settlement reserve recorded in the fourth quarter of
2022. (2) Includes a $35.0 million regulatory settlement reserve.
(3) Includes a $5.5 million reversal of the regulatory settlement
reserve recorded in the fourth quarter of 2022. (4) Total revenues
equal net interest income plus non-interest income. (5) For periods
less than a year, ratios are annualized. (6) Net income divided by
average tangible common equity. Non-GAAP financial measure. See
Reconciliation of Non-GAAP Measures on page 13.
Net Interest Income
Net interest income for the fourth quarter of 2023 was $57.0
million compared to $53.6 million for the prior linked quarter and
$63.9 million for the prior year period. The $3.4 million increase
from the prior linked quarter was due primarily to loan growth and
increases in loan yields, partially offset by the shift from
non-interest bearing deposits to interest bearing deposits and
borrowings primarily related to the exit from the crypto-related
deposit vertical. The $6.9 million decrease from the prior year
period was due primarily to the 197 basis point increase in total
cost of funds and the shift from non-interest bearing deposits to
interest bearing funding primarily related to the exit from the
crypto-related deposit vertical, partially offset by the increase
in the average balance of loans and loan yields.
Net interest income for the year 2023 was $222.8 million
compared to $229.2 million for the prior year. The $6.3 million
decrease was due primarily to the 212 basis point increase in total
cost of funds and the shift from non-interest bearing deposits to
interest bearing funding primarily related to the exit from the
crypto-related deposit vertical, partially offset by the increase
in the average balance of loans and loan yields.
Net Interest Margin
Net interest margin for the fourth quarter of 2023 was 3.36%
compared to 3.27% and 4.05% for the prior linked quarter and prior
year period, respectively. The 9 basis point increase from the
prior linked quarter was due primarily to the increase in the
average balance of loans and loan yields, partially offset by the
higher cost of funds. The 69 basis point decrease from the prior
year period was driven largely by the increase in the average
balance of borrowed funds and the shift from non-interest bearing
deposits to interest bearing deposits related to the final exit
from the crypto-related deposit vertical, partially offset by loan
growth and the increase in loan yields. Net interest margin was
consistent at 3.49% for the years 2023 and 2022.
Total cost of funds for the fourth quarter of 2023 was 314 basis
points compared to 303 basis points and 117 basis points for the
prior linked quarter and prior year period, respectively. Total
cost of funds for the year 2023 was 265 basis points compared to 53
basis points for the prior year. The increase in the cost of funds
reflects the increase in prevailing interest rates and the shift
from non-interest bearing deposits to interest bearing funding
primarily related to the final exit from the crypto-related deposit
vertical.
Non-Interest Income
Non-interest income was $6.6 million for the fourth quarter of
2023, an increase of $48,000 from the prior linked quarter and an
increase of $211,000 from the prior year period. The increase from
the prior linked quarter was driven primarily by an increase in
service charges on deposits, partially offset by a decrease in
other service charges and fees. The increase from the prior linked
period was driven primarily by an increase in service charges on
deposits and other service charges and fees, partially offset by
lower Global Payments Group revenue.
Non-interest income was $27.9 million for the year 2023, an
increase of $1.3 million from the prior year driven primarily by
increases in service charges on deposits and other service charges
and fees.
Non-Interest Expense
Non-interest expense was $37.1 million for the fourth quarter of
2023, an increase of $6.2 million from the prior linked quarter and
a decrease of $29.5 million from the prior year period. The
increase from the prior linked quarter was due primarily to the
$3.0 million reversal of the regulatory settlement reserve in the
third quarter of 2023, a $1.2 million increase in professional fees
and a $1.0 million increase in compensation and benefits. The
decrease from the prior year period was due primarily to the $35.0
million regulatory settlement reserve recorded in the fourth
quarter of 2022.
Non-interest expense was $131.5 million for the year 2023, a
decrease of $17.2 million from the prior year driven primarily by
the $35.0 million regulatory settlement reserve recorded in the
fourth quarter of 2022, partially offset by a $9.7 million increase
in compensation and benefits, a $4.5 million increase in FDIC
assessments and a $3.6 million increase in professional fees.
Income Tax Expense
The effective tax rate for the year 2023 was 27.7% compared to
38.7% for the prior year, which reflects a discrete tax item
related to the exercise of stock options in 2023 and the $5.5
million reversal of the regulatory settlement reserve in 2023. The
elevated effective tax rate for the year 2022 reflects the
recording of the $35.0 million regulatory settlement reserve and
other discrete tax items.
Asset Quality
Credit quality remains strong. The ratio of non-performing loans
to total loans was 0.92% at December 31, 2023 compared to 0.58% at
September 30, 2023 and 0.00% at December 31, 2022, respectively.
The allowance for credit losses (“ACL”) was $58.0 million at
December 31, 2023, an increase of $5.7 million from September 30,
2023 and an increase of $13.1 million from December 31, 2022. The
increase from the prior linked quarter was due primarily to loan
growth and a $4.8 million provision on a single multifamily loan,
partially offset by modest improvements in certain macroeconomic
variables which inform our Current Expected Credit Loss (“CECL”)
model. The increase from the prior year period was due primarily to
loan growth, the $4.8 million provision on the single multifamily
loan and the adoption of ASU No. 2016-13. The Company adopted ASU
No. 2016-13, Financial Instruments – Credit Losses (ASC 326)
effective January 1, 2023. ASU No. 2016-13 requires the measurement
of all expected credit losses for financial assets held at
amortized cost to be based on historical experience, current
condition, and reasonable and supportable forecasts. Upon adoption,
the Company recorded a $2.3 million increase to the ACL for loans,
a $777,000 increase to the ACL for loan commitments, and a $2.1
million decrease to retained earnings, net of taxes.
Conference Call
The Company will conduct a conference call at 9:00 a.m. ET on
Friday, January 19, 2024, to discuss the results. To access the
event by telephone, please dial 800-267-6316 (US), 203-518-9783
(INTL), and provide conference ID: MCBQ423 approximately 15 minutes
prior to the start time (to allow time for registration).
The call will also be broadcast live over the Internet and
accessible at MCB Quarterly Results Conference Call and in the
Investor Relations section of the Company’s website at MCB News. To
listen to the live webcast, please visit the site at least 15
minutes prior to the start time to register, download and install
any necessary audio software. For those unable to join for the live
presentation, a replay of the webcast will also be available later
that day accessible at MCB Quarterly Results Conference Call.
About Metropolitan Bank Holding
Corp.
Metropolitan Bank Holding Corp. (NYSE: MCB) is the parent
company of Metropolitan Commercial Bank (the “Bank”), a New York
City based full-service commercial bank.
The Bank provides a broad range of business, commercial and
personal banking products and services to individuals, small
businesses, private and public middle-market and corporate
enterprises and institutions, municipalities and local government
entities.
Metropolitan Commercial Bank’s Global Payments Group is an
established leader in providing payments services to domestic and
international non-bank financial service companies. The Bank
continues to grow its presence as a valued, trusted and innovative
strategic partner across payments, custodial and money services
businesses worldwide.
Metropolitan Commercial Bank’s EB-5 / E-2 International Group
delivers banking services and products for United States Citizen
and Immigration Services EB-5 Immigrant Investor Program investors,
developers, Regional Centers, government agencies, law firms and
consulting companies that specialize in EB-5 and E-2.
Metropolitan Commercial Bank was named one of Newsweek's Best
Regional Banks and Credit Unions 2024. The Bank was ranked by
Independent Community Bankers of America among the top ten
successful loan producers for 2023 by loan category and asset size
for commercial banks with more than $1 billion in assets. The Bank
finished ninth in S&P Global Market Intelligence’s annual
ranking of the best-performing community banks with assets between
$3 billion and $10 billion for 2022 and eighth among top-performing
community banks in the Northeast region for 2022. Kroll affirmed a
BBB+ (investment grade) deposit rating on January 25, 2023.
The Bank is a New York State chartered commercial bank, a member
of the Federal Reserve System and the Federal Deposit Insurance
Corporation, and an equal housing lender.
For more information, please visit the Bank’s website at
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 future 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 are
difficult to predict and are generally beyond our control and 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 the following: the interest rate policies of the
Board of Governors of the Federal Reserve System; inflation; an
unexpected deterioration in our loan or securities portfolios;
changes in liquidity, including the size and composition of our
deposit portfolio, including the percentage of uninsured deposits
in the portfolio; further deterioration in the financial condition
or stock prices of financial institutions generally; unexpected
increases in our expenses; different than anticipated growth and
our ability to manage our growth; the lingering effects of the
COVID-19 pandemic on our business and results of operation;
unanticipated regulatory action or changes in regulations;
potential recessionary conditions; unanticipated volatility in
deposits; unexpected increases in credit losses or in the level of
delinquent, nonperforming, classified and criticized loans; our
ability to absorb the amount of actual losses inherent in our
existing loan portfolio; an unanticipated loss of key personnel or
existing customers; competition from other institutions resulting
in unanticipated changes in our loan or deposit rates; an
unexpected adverse financial, regulatory or bankruptcy event
experienced by our non-bank financial service partners;
unanticipated increases in FDIC costs; changes in regulations,
legislation or tax or accounting rules, monetary and fiscal
policies of the U.S. Government including policies of the U.S.
Treasury; impacts related to or resulting from recent bank
failures; an unexpected failure to successfully manage our credit
risk and the sufficiency of our allowance, the credit and other
risks from borrower and depositor concentrations (by geographic
area and by industry); the current or anticipated impact of
military conflict, terrorism or other geopolitical events; the
costs, including possibly incurring fines, penalties or other
negative effects (including reputational harm), of any adverse
judicial, administrative, or arbitral rulings or proceedings,
regulatory enforcement actions, or other legal actions; a failure
in or breach of the Company’s operational or security systems or
infrastructure, including cyberattacks; the failure to maintain
current technologies, or to implement new technologies; the failure
to maintain effective internal controls over financial reporting;
the failure to retain or attract employees; and unanticipated
adverse changes in our customers’ economic conditions or general
economic conditions, 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 which have been filed with the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as
amended.
Forward-looking statements speak only as of the date of this
release. We do not undertake (and expressly disclaim) any
obligation to update or revise any forward-looking statement,
except as may be required by law.
Consolidated Balance Sheet
(unaudited)
Dec. 31,
Sept. 30,
Jun. 30,
Mar. 31,
Dec. 31,
(in thousands)
2023
2023
2023
2023
2022
Assets
Cash and due from banks
$
31,973
$
36,438
$
33,534
$
32,525
$
26,780
Overnight deposits
237,492
140,929
168,242
266,978
230,638
Total cash and cash equivalents
269,465
177,367
201,776
299,503
257,418
Investment securities
available-for-sale
461,207
429,850
426,068
444,169
445,747
Investment securities held-to-maturity
468,860
478,886
515,613
501,525
510,425
Equity investment securities, at fair
value
2,123
2,015
2,066
2,087
2,048
Total securities
932,190
910,751
943,747
947,781
958,220
Other investments
38,966
35,015
28,040
27,099
22,110
Loans, net of deferred fees and
unamortized costs
5,624,797
5,354,487
5,149,546
4,851,694
4,840,523
Allowance for credit losses
(57,965
)
(52,298
)
(51,650
)
(47,752
)
(44,876
)
Net loans
5,566,832
5,302,189
5,097,896
4,803,942
4,795,647
Receivables from global payments business,
net
87,648
79,892
84,919
83,787
85,605
Other assets
172,571
178,145
165,772
147,870
148,337
Total assets
$
7,067,672
$
6,683,359
$
6,522,150
$
6,309,982
$
6,267,337
Liabilities and Stockholders'
Equity
Deposits
Non-interest-bearing demand deposits
$
1,837,874
$
1,746,626
$
1,730,380
$
2,122,606
$
2,422,151
Interest-bearing deposits
3,899,418
3,774,963
3,558,185
3,009,182
2,855,761
Total deposits
5,737,292
5,521,589
5,288,565
5,131,788
5,277,912
Federal funds purchased
99,000
—
243,000
195,000
150,000
Federal Home Loan Bank of New York
advances
440,000
355,000
200,000
200,000
100,000
Trust preferred securities
20,620
20,620
20,620
20,620
20,620
Secured borrowings
7,585
7,621
7,655
7,689
7,725
Prepaid third-party debit cardholder
balances
10,178
10,297
10,772
11,102
10,579
Other liabilities
93,976
133,322
130,263
135,896
124,604
Total liabilities
6,408,651
6,048,449
5,900,875
5,702,095
5,691,440
Common stock
111
110
110
112
109
Additional paid in capital
395,871
393,544
392,742
394,124
389,276
Retained earnings
315,975
301,407
279,344
263,783
240,810
Accumulated other comprehensive gain
(loss), net of tax effect
(52,936
)
(60,151
)
(50,921
)
(50,132
)
(54,298
)
Total stockholders’ equity
659,021
634,910
621,275
607,887
575,897
Total liabilities and stockholders’
equity
$
7,067,672
$
6,683,359
$
6,522,150
$
6,309,982
$
6,267,337
Consolidated Statement of Income
(unaudited)
Three months ended
Year ended
Dec. 31,
Sept. 30,
Dec. 31,
Dec. 31,
Dec. 31,
(dollars in thousands, except per share
data)
2023
2023
2022
2023
2022
Total interest income
$
105,267
$
97,897
$
80,554
$
375,405
$
260,739
Total interest expense
48,273
44,340
16,655
152,569
31,581
Net interest income
56,994
53,557
63,899
222,836
229,158
Provision for credit losses
6,541
791
2,309
12,283
10,116
Net interest income after provision for
credit losses
50,453
52,766
61,590
210,553
219,042
Non-interest income
Service charges on deposit accounts
1,671
1,463
1,458
6,071
5,747
Global Payments Group revenue
4,177
4,247
4,343
19,005
19,341
Other income
713
803
549
2,827
1,505
Total non-interest income
6,561
6,513
6,350
27,903
26,593
Non-interest expense
Compensation and benefits
18,210
17,208
15,886
66,961
57,290
Bank premises and equipment
2,317
2,396
2,247
9,344
8,855
Professional fees
5,031
3,873
5,171
18,064
14,423
Technology costs
974
1,171
1,186
4,940
4,713
Licensing fees
3,638
3,504
2,674
12,818
10,477
FDIC assessments
2,639
1,984
1,030
9,077
4,625
Regulatory settlement reserve
—
(3,021
)
35,000
(5,521
)
35,000
Other expenses
4,338
3,809
3,465
15,855
13,354
Total non-interest expense
37,147
30,924
66,659
131,538
148,737
Net income before income tax expense
19,867
28,355
1,281
106,918
96,898
Income tax expense
5,299
6,292
9,021
29,650
37,473
Net income (loss)
$
14,568
$
22,063
$
(7,740
)
$
77,268
$
59,425
Earnings per common share:
Average common shares outstanding:
Basic
11,062,729
11,039,363
10,932,952
11,060,110
10,929,021
Diluted
11,366,463
11,136,873
11,183,862
11,129,900
11,200,184
Basic earnings (loss)
$
1.31
$
1.99
$
(0.71
)
$
6.95
$
5.42
Diluted earnings (loss)
$
1.28
$
1.97
$
(0.71
)
$
6.91
$
5.29
Loan Production, Asset Quality &
Regulatory Capital
Dec. 31,
Sept. 30,
Jun. 30,
Mar. 31,
Dec. 31,
2023
2023
2023
2023
2022
LOAN PRODUCTION (in millions)
$
342.5
$
333.5
$
425.4
$
265.4
$
411.3
ASSET QUALITY (in thousands)
Non-accrual loans:
Commercial real estate
$
44,939
$
24,000
$
24,000
$
24,000
$
—
Commercial and industrial
6,934
6,934
—
—
—
Consumer
24
24
24
24
24
Total non-accrual loans
$
51,897
$
30,958
$
24,024
$
24,024
$
24
Non-accrual loans to total loans
0.92
%
0.58
%
0.47
%
0.50
%
—
%
Allowance for credit losses
$
57,965
$
52,298
$
51,650
$
47,752
$
44,876
Allowance for credit losses to total
loans
1.03
%
0.98
%
1.00
%
0.98
%
0.93
%
Charge-offs
$
(946
)
$
(129
)
$
(44
)
$
(100
)
$
—
Recoveries
$
—
$
—
$
—
$
—
$
25
Net charge-offs/(recoveries) to average
loans (annualized)
0.07
%
0.01
%
—
%
0.01
%
—
%
REGULATORY CAPITAL
Tier 1 Leverage:
Metropolitan Bank Holding Corp.
10.6
%
10.7
%
10.8
%
10.8
%
10.2
%
Metropolitan Commercial Bank
10.3
%
10.5
%
10.5
%
10.4
%
10.0
%
Common Equity Tier 1 Risk-Based
(CET1):
Metropolitan Bank Holding Corp.
11.5
%
11.8
%
11.9
%
12.3
%
12.1
%
Metropolitan Commercial Bank
11.6
%
11.9
%
11.9
%
12.3
%
12.3
%
Tier 1 Risk-Based:
Metropolitan Bank Holding Corp.
11.9
%
12.2
%
12.2
%
12.7
%
12.5
%
Metropolitan Commercial Bank
11.6
%
11.9
%
11.9
%
12.3
%
12.3
%
Total Risk-Based:
Metropolitan Bank Holding Corp.
12.8
%
13.1
%
13.2
%
13.6
%
13.4
%
Metropolitan Commercial Bank
12.5
%
12.8
%
12.9
%
13.2
%
13.1
%
Performance Measures
Three months ended
Year ended
Dec. 31,
Sept. 30,
Dec. 31,
Dec. 31,
Dec. 31,
(dollars in thousands, except per share
data)
2023
2023(1)
2022(2)
2023(3)
2022(2)
Net income per consolidated statements of
income
$
14,568
$
22,063
$
(7,740
)
$
77,268
$
59,425
Less: Earnings allocated to participating
securities
(78
)
(118
)
—
(365
)
(141
)
Net income (loss) available to common
shareholders
$
14,490
$
21,945
$
(7,740
)
$
76,903
$
59,284
Per common share:
Basic earnings (loss)
$
1.31
$
1.99
$
(0.71
)
$
6.95
$
5.42
Diluted earnings (loss)
$
1.28
$
1.97
$
(0.71
)
$
6.91
$
5.29
Common shares outstanding:
Period end
11,062,729
11,062,729
10,949,965
11,062,729
10,949,965
Average fully diluted
11,366,463
11,136,873
11,183,862
11,129,900
11,200,184
Return on:(4)
Average total assets
0.84
%
1.33
%
N.M.
%
1.19
%
0.90
%
Average equity
9.0
%
13.9
%
N.M.
%
12.4
%
10.3
%
Average tangible common equity(5)
9.1
%
14.1
%
N.M.
%
12.6
%
10.4
%
Yield on average earning assets(4)
6.21
%
5.99
%
5.12
%
5.88
%
3.97
%
Total cost of deposits(4)
2.98
%
2.74
%
1.11
%
2.43
%
0.49
%
Net interest spread(4)
1.81
%
1.67
%
2.79
%
1.85
%
2.82
%
Net interest margin(4)
3.36
%
3.27
%
4.05
%
3.49
%
3.49
%
Net charge-offs as % of average
loans(4)
0.07
%
0.01
%
—
%
0.02
%
—
%
Efficiency ratio(6)
58.4
%
51.5
%
94.9
%
52.46
%
58.16
%
____________________ (1) Includes a $3.0 million reversal of the
regulatory settlement reserve recorded in the fourth quarter of
2022. (2) Includes a $35.0 million regulatory settlement reserve.
(3) Includes a $5.5 million reversal of the regulatory settlement
reserve recorded in the fourth quarter of 2022. (4) For periods
less than a year, ratios are annualized. (5) Net income divided by
average tangible common equity. Non-GAAP financial measure. See
Reconciliation of Non-GAAP Measures on page 13. (6) Total
non-interest expense divided by total revenues.
Interest Margin Analysis
Three months ended
Dec. 31, 2023
Sept. 30, 2023
Dec. 31, 2022
Average
Yield /
Average
Yield /
Average
Yield /
(dollars in thousands)
Balance
Interest
Rate (1)
Balance
Interest
Rate (1)
Balance
Interest
Rate (1)
Assets:
Interest-earning assets:
Loans (2)
$
5,538,095
$
97,897
7.01
%
$
5,283,114
$
90,666
6.80
%
$
4,796,001
$
72,560
5.98
%
Available-for-sale securities
532,970
2,430
1.82
527,673
2,261
1.71
527,523
1,979
1.50
Held-to-maturity securities
474,475
2,217
1.87
497,682
2,412
1.94
518,822
2,422
1.87
Equity investments
2,401
14
2.30
2,387
13
2.20
2,351
10
1.70
Overnight deposits
139,009
1,966
5.53
124,211
1,783
5.62
362,244
3,291
3.55
Other interest-earning assets
35,718
743
8.32
36,952
762
8.24
18,689
292
6.26
Total interest-earning assets
6,722,668
105,267
6.21
6,472,019
97,897
5.99
6,225,630
80,554
5.12
Non-interest-earning assets
192,237
170,195
101,826
Allowance for credit losses
(53,570
)
(52,357
)
(43,643
)
Total assets
$
6,861,335
$
6,589,857
$
6,283,813
Liabilities and Stockholders'
Equity:
Interest-bearing liabilities:
Money market and savings accounts
$
3,891,476
42,395
4.32
$
3,465,347
35,969
4.12
$
2,683,653
15,241
2.25
Certificates of deposit
34,179
272
3.16
38,937
265
2.70
49,470
207
1.66
Total interest-bearing deposits
3,925,655
42,667
4.31
3,504,284
36,234
4.10
2,733,123
15,448
2.24
Borrowed funds
427,250
5,606
5.25
572,456
8,106
5.66
101,600
1,207
4.75
Total interest-bearing liabilities
4,352,905
48,273
4.40
4,076,740
44,340
4.32
2,834,723
16,655
2.33
Non-interest-bearing liabilities:
Non-interest-bearing deposits
1,748,178
1,734,956
2,792,370
Other non-interest-bearing liabilities
116,995
146,956
60,951
Total liabilities
6,218,078
5,958,652
5,688,044
Stockholders' equity
643,257
631,205
595,769
Total liabilities and equity
$
6,861,335
$
6,589,857
$
6,283,813
Net interest income
$
56,994
$
53,557
$
63,899
Net interest rate spread (3)
1.81
%
1.67
%
2.79
%
Net interest margin (4)
3.36
%
3.27
%
4.05
%
Total cost of deposits (5)
2.98
%
2.74
%
1.11
%
Total cost of funds (6)
3.14
%
3.03
%
1.17
%
________________________ (1) Ratios are annualized. (2) Amount
includes deferred loan fees and non-performing loans. (3)
Determined by subtracting the annualized average cost of total
interest-bearing liabilities from the annualized average yield on
total interest-earning assets. (4) Determined by dividing
annualized net interest income by total average interest-earning
assets. (5) Determined by dividing annualized interest expense on
deposits by total average interest-bearing and non-interest bearing
deposits. (6) Determined by dividing annualized interest expense by
the sum of total average interest-bearing liabilities and total
average non-interest-bearing deposits.
Interest Margin Analysis,
continued
Year ended
Dec. 31, 2023
Dec. 31, 2022
Average
Yield /
Average
Yield /
(dollars in thousands)
Balance
Interest
Rate
Balance
Interest
Rate
Assets:
Interest-earning assets:
Loans (1)
$
5,147,653
$
345,039
6.70
%
$
4,361,412
$
231,851
5.32
%
Available-for-sale securities
527,873
8,865
1.68
538,425
$
6,921
1.29
Held-to-maturity securities
499,379
9,608
1.92
495,812
$
8,682
1.75
Equity investments
2,381
52
2.17
2,339
$
32
1.37
Overnight deposits
176,813
9,319
5.20
1,156,468
$
12,314
1.05
Other interest-earning assets
33,061
2,522
7.63
16,700
$
939
5.62
Total interest-earning assets
6,387,160
375,405
5.88
6,571,156
260,739
3.97
Non-interest-earning assets
169,377
90,495
Allowance for credit losses
(49,923
)
(40,020
)
Total assets
$
6,506,614
$
6,621,631
Liabilities and Stockholders'
Equity:
Interest-bearing liabilities:
Money market and savings accounts
$
3,299,427
$
127,494
3.86
$
2,652,502
$
28,694
1.08
Certificates of deposit
42,926
1,183
2.76
59,645
$
590
0.99
Total interest-bearing deposits
3,342,353
128,677
3.85
2,712,147
29,284
1.08
Borrowed funds
445,061
23,892
5.37
45,878
2,297
5.00
Total interest-bearing liabilities
3,787,414
152,569
4.03
2,758,025
31,581
1.15
Non-interest-bearing liabilities:
Non-interest-bearing deposits
1,960,469
3,223,606
Other non-interest-bearing liabilities
137,725
61,213
Total liabilities
5,885,608
6,042,844
Stockholders' equity
621,006
578,787
Total liabilities and equity
$
6,506,614
$
6,621,631
Net interest income
$
222,836
$
229,158
Net interest rate spread (2)
1.85
%
2.82
%
Net interest margin (3)
3.49
%
3.49
%
Total cost of deposits (4)
2.43
%
0.49
%
Total cost of funds (5)
2.65
%
0.53
%
_________________________ (1) Amount includes deferred loan fees
and non-performing loans. (2) Determined by subtracting the
annualized average cost of total interest-bearing liabilities from
the annualized 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 on deposits by total average
interest-bearing and non-interest bearing deposits. (5) Determined
by dividing annualized interest expense by the sum of total average
interest-bearing liabilities and total average non-interest-bearing
deposits.
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 tables:
Quarterly Data
Year ended
(dollars in thousands,
Dec. 31,
Sept. 30,
Jun. 30,
Mar. 31,
Dec. 31,
Dec. 31,
Dec. 31,
except per share data)
2023
2023
2023
2023
2022
2023
2022
Average assets
$
6,861,335
$
6,589,857
$
6,354,597
$
6,212,624
$
6,283,813
$
6,506,614
$
6,621,631
Less: average intangible assets
9,733
9,733
9,733
9,733
9,733
9,733
9,733
Average tangible assets (non-GAAP)
$
6,851,602
$
6,580,124
$
6,344,864
$
6,202,891
$
6,274,080
$
6,496,881
$
6,611,898
Average common equity
$
643,257
$
631,205
$
616,370
$
592,521
$
595,769
$
621,006
$
578,787
Less: average intangible assets
9,733
9,733
9,733
9,733
9,733
9,733
9,733
Average tangible common equity
(non-GAAP)
$
633,524
$
621,472
$
606,637
$
582,788
$
586,036
$
611,273
$
569,054
Total assets
$
7,067,672
$
6,683,359
$
6,522,150
$
6,309,982
$
6,267,337
$
7,067,672
$
6,267,337
Less: intangible assets
9,733
9,733
9,733
9,733
9,733
9,733
9,733
Tangible assets (non-GAAP)
$
7,057,939
$
6,673,626
$
6,512,417
$
6,300,249
$
6,257,604
$
7,057,939
$
6,257,604
Common equity
$
659,021
$
634,910
$
621,275
$
607,887
$
575,897
$
659,021
$
575,897
Less: intangible assets
9,733
9,733
9,733
9,733
9,733
9,733
9,733
Tangible common equity (book value)
(non-GAAP)
$
649,288
$
625,177
$
611,542
$
598,154
$
566,164
$
649,288
$
566,164
Common shares outstanding
11,062,729
11,062,729
10,991,074
11,211,274
10,949,965
11,062,729
10,949,965
Book value per share (GAAP)
$
59.57
$
57.39
$
56.53
$
54.22
$
52.59
$
59.57
$
52.59
Tangible book value per share (non-GAAP)
(1)
$
58.69
$
56.51
$
55.64
$
53.35
$
51.70
$
58.69
$
51.70
________________________ (1) Tangible book value divided by
common shares outstanding at period-end.
Explanatory Note
Some amounts presented within this document may not recalculate
due to rounding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240118969889/en/
Daniel F. Dougherty EVP & Chief Financial Officer
Metropolitan Commercial Bank (212) 365-6721 IR@MCBankNY.com
Metropolitan Bank (NYSE:MCB)
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Metropolitan Bank (NYSE:MCB)
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