Metropolitan Bank Holding Corp. Reports Record 2018 Earnings of $25.6 Million or $3.06 per Diluted Common Share Led by Growth in Loans, Deposits and Net Interest Margin - Metropolitan Bank Holding (NYSE:MCB)

Metropolitan Bank Holding Corp. MCB, the holding company (the "Company") for Metropolitan Commercial Bank (the "Bank"), today reported net income of $6.3 million or $0.75 per diluted common share for the fourth quarter of 2018 as compared to $3.3 million, or $0.49 per diluted common share, for the fourth quarter of 2017.

For the year ended December 31, 2018, the Company reported net income of $25.6 million, or $3.06 per diluted common share, as compared to $12.4 million, or $2.34 per diluted common share, for the year ended December 31, 2017.

Financial Highlights for the fourth quarter of 2018 include:

Total assets increased 24% to $2.18 billion at December 31, 2018 as compared to $1.76 billion at December 31, 2017.
Total loans, net of deferred fees and unamortized costs increased 32% to $1.87 billion at December 31, 2018, as compared to $1.42 billion at December 31, 2017. During the three and twelve-month periods ended December 31, 2018, the Bank's loan production was $283.0 million and $823.9 million, respectively as compared to $111.8 million and $446.4 million for the same periods in 2017.
Total deposits increased 18% to $1.66 billion at December 31, 2018 as compared to $1.40 billion at December 31, 2017.
Net interest margin increased 29 basis points to 3.77% for the fourth quarter of 2018 from 3.48% for the fourth quarter of 2017. For the year ended December 31, 2018, net interest margin increased 18 basis points to 3.70% as compared to 3.52% in 2017.
Non-interest-bearing demand accounts decreased 1.7% to $798.6 million at December 31, 2018 as compared to $812.6 million at December 31, 2017.
Interest-bearing deposits increased 45.7% to $862.0 million at December 31, 2018 as compared to $591.7 million at December 31, 2017.
Annualized return on average assets for the fourth quarter of 2018 was 1.25%, an increase of 52 basis points as compared to 0.73% for the fourth quarter of 2017.
Annualized return on average equity was 9.59% for the fourth quarter of 2018 as compared to 7.44% for the fourth quarter of 2017. Annualized return on average common equity was 9.80% for the fourth quarter of 2018 as compared to 7.68% for the fourth quarter of 2017. The Company completed its initial public offering in November 2017 raising net proceeds of $114.8 million.
The Company's efficiency ratio in the fourth quarter of 2018 was 54.9%, compared to 44.8% for the same quarter in 2017. For the year ended December 31, 2018, the efficiency ratio was 52.1% as compared to 51.7% for 2017.

Mark DeFazio, the Company's President and Chief Executive Officer commented, "We just completed a very successful year – our first as a public company. The loan portfolio grew by 32% and deposits grew by 18%. These results are a testament to the Bank's relationship-based business model, the strength of our lending and retail teams and the Bank's various deposit verticals. Most notably, earnings doubled in 2018 compared to 2017. These results exceeded our internal projections and provide the Company with a strong jumping-off point for 2019. As a team, we remain focused on delivering sustainable results for our shareholders."

Mr. DeFazio continued, "The success of Metropolitan Commercial Bank is the result of a very talented and focused group of people operating in a market that holds many opportunities. We are looking forward to a very exciting 2019 as we continue to leverage the capital we raised. The Bank's loan pipeline is strong, and we will continue to implement our branch-light strategy of funding this growth with diversified deposit verticals."

Balance Sheet

The Company had total assets of $2.18 billion at December 31, 2018, compared with $1.76 billion on December 31, 2017. Loans, net of deferred fees and unamortized costs increased to $1.9 billion at December 31, 2018 as compared to $1.4 billion at December 31, 2017. For the three and twelve months ended December 31, 2018, the Bank's loan production was $283.0 million and $823.9 million, respectively as compared to $111.8 million and $446.4 million for the same periods in 2017.

Total deposits increased $256.2 million, or 18%, to $1.7 billion at December 31, 2018 as compared to $1.4 billion at December 31, 2017. This was due to an increase of $270.3 million in interest-bearing demand deposits partially offset by a decrease of $14.1 million in non-interest-bearing deposits.

Total borrowings increased by $142.9 million to $230.2 million at December 31, 2018 as compared to $87.3 million at December 31, 2017. This was due to an increase of $142.8 million in Federal Home Loan Bank advances, which were used to support the Bank's loan growth.

Total stockholders' equity was $264.5 million on December 31, 2018 compared to $236.9 million at December 31, 2017. The Company completed an Initial Public Offering (IPO) in November 2017. Total proceeds from the IPO, net of issuance costs, were $114.8 million. Metropolitan Commercial Bank meets all the requirements to be considered "Well-Capitalized" under applicable regulatory guidelines. At December 31, 2018, total Commercial Real Estate Loans ("CRE") were 312.4% of risk-based capital, compared to 267.7% at December 31, 2017.

Income Statement

(Dollars in thousands, except per share data)	Quarter Ended Dec. 31,						Year Ended Dec. 31,
(Dollars in thousands, except per share data)	2018			2017			2018			2017
Net income	$	6,285		$	3,326		$	25,554		$	12,369
Diluted earnings per common share		0.75			0.49			3.06			2.34
Annualized return on average assets		1.25	%		0.73	%		1.31	%		0.81	%
Annualized return on average equity		9.59	%		7.44	%		10.18	%		9.27	%
Annualized return on average common equity*		9.80	%		7.68	%		10.41	%		9.67	%

*Common equity excludes Class B preferred stock. See reconciliation to GAAP measures on page 12.

Net income increased $3.0 million to $6.3 million for the fourth quarter of 2018 as compared to $3.3 million for the same period in 2017. This increase was due primarily to a $3.3 million increase in net interest income, a $2.7 million decrease in the provision for loan losses and a $2.8 million decrease in income tax expense, partially offset by a $4.0 million decrease in non-interest income and a $1.8 million increase in non-interest expense.

For the year ended December 31, 2018, net income increased $13.2 million to $25.6 million as compared to $12.4 million for 2017. This increase was due primarily to a $19.0 million increase in net interest income, a $3.9 million decrease in the provision for loan losses and a $1.0 million increase in non-interest income, partially offset by a $10.8 million increase in non-interest expense.


Net Interest Margin Analysis	Three months ended
(dollars in thousands)	December 31, 2018							December 31, 2017
(dollars in thousands)	Average Outstanding Balance			Interest		Yield/Rate (annualized)		Average Outstanding Balance			Interest		Yield/Rate (annualized)
Assets:
Interest-earning assets:
Loans ⁽¹⁾	$	1,760,937		$	21,875	4.93	%	$	1,397,700		$	16,375	4.65	%
Available-for-sale securities		30,671			178	2.28	%		33,322			172	2.02	%
Held-to-maturity securities		4,668			24	2.01	%		5,559			28	1.97	%
Overnight deposits		177,539			1,028	2.30	%		314,244			1,117	1.41	%
Other interest-earning assets		19,634			237	4.79	%		34,959			243	2.76	%
Total interest-earning assets		1,993,449			23,342	4.65	%		1,785,784			17,935	3.98	%
Non-interest-earning assets		41,101							43,323
Allowance for loan and lease losses		(18,719	)						(15,322	)
Total assets	$	2,015,831						$	1,813,785

Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Money market and savings accounts	$	701,042		$	2,773	1.57	%	$	559,339		$	1,277	0.91	%
Certificates of deposit		99,008			528	2.12	%		82,020			280	1.36	%
Total interest-bearing deposits		800,050			3,301	1.64	%		641,359			1,557	0.96	%
Borrowed funds		116,678			1,080	3.62	%		88,488			736	3.25	%
Total interest-bearing liabilities		916,728			4,381	1.90	%		729,847			2,293	1.25	%
Non-interest-bearing liabilities:
Non-interest-bearing deposits		812,415							868,117
Other non-interest-bearing liabilities		24,658							37,074
Total liabilities		1,753,801							1,635,038

Stockholders' Equity		262,030							178,747
Total liabilities and equity	$	2,015,831						$	1,813,785

Net interest income				$	18,961						$	15,642
Net interest rate spread ⁽²⁾						2.75	%						2.74	%
Net interest-earning assets	$	1,076,721						$	1,055,937
Net interest margin ⁽³⁾						3.77	%						3.48	%
Ratio of interest earning assets to interest bearing liabilities						2.17x							2.45x

(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.


Net Interest Margin Analysis	Year ended
(dollars in thousands)	December 31, 2018							December 31, 2017
(dollars in thousands)	Average Outstanding Balance			Interest		Yield/Rate		Average Outstanding Balance			Interest		Yield/Rate
Assets:
Interest-earning assets:
Loans ⁽¹⁾	$	1,604,624		$	77,342	4.82	%	$	1,244,194		$	57,186	4.60	%
Available-for-sale securities		30,663			668	2.15	%		35,085			720	2.02	%
Held-to-maturity securities		4,987			104	2.06	%		5,963			123	2.03	%
Overnight deposits		257,841			4,838	1.88	%		166,640			2,074	1.24	%
Other interest-earning assets		27,962			993	3.55	%		29,165			761	2.61	%
Total interest-earning assets		1,926,077			83,945	4.36	%		1,481,047			60,864	4.11	%
Non-interest-earning assets		43,206							58,477
Allowance for loan and lease losses		(17,301	)						(15,322	)
Total assets	$	1,951,982						$	1,524,202

Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Money market and savings accounts	$	600,334		$	7,511	1.25	%	$	561,733		$	4,840	0.86	%
Certificates of deposit		87,966			1,592	1.81	%		80,130			1,033	1.29	%
Total interest-bearing deposits		688,300			9,103	1.32	%		641,863			5,873	0.92	%
Borrowed funds		96,905			3,614	3.68	%		105,684			2,798	2.61	%
Total interest-bearing liabilities		785,205			12,717	1.62	%		747,547			8,671	1.16	%
Non-interest-bearing liabilities:
Non-interest-bearing deposits		884,604							607,743
Other non-interest-bearing liabilities		31,143							35,450
Total liabilities		1,700,952							1,390,740

Stockholders' Equity		251,030							133,462
Total liabilities and equity	$	1,951,982						$	1,524,202

Net interest income				$	71,228						$	52,193
Net interest rate spread ⁽²⁾						2.74	%						2.95	%
Net interest-earning assets	$	1,140,872						$	733,500
Net interest margin ⁽³⁾						3.70	%						3.52	%
Ratio of interest earning assets to interest bearing liabilities						2.45x							1.98x

(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.

Net Interest Income

Net interest margin increased 29 basis points to 3.77% for the fourth quarter of 2018 from 3.48% for the fourth quarter of 2017. This increase was mainly the result of a 28 basis point increase in average loan yields to 4.93% for the fourth quarter of 2018 as compared to 4.65% for the same period in 2017, and an increase of 89 basis points in the average yield on overnight deposits to 2.30% as compared to 1.41% for the same period in 2017. Total average interest-earning assets increased $207.7 million for the fourth quarter of 2018 as compared to the fourth quarter of 2017, due primarily to a $363.2 million increase in average loans, which was partially offset by a decrease of $136.7 million in overnight funds. The total yield on average interest-earning assets increased 67 basis points to 4.65% in the fourth quarter of 2018 as compared to 3.98% in the same period on 2017.

For the year ended December 31, 2018, net interest margin increased 18 basis points to 3.70% as compared to 3.52% for 2017. This increase was primarily the result of an increase of 22 basis points in average loan yields to 4.82% for 2018 as compared to 4.60% in 2017. Net interest margin also benefited from the effect of an increase in average non-interest-bearing deposits as a percentage of total average deposits at December 31, 2018 as compared to the same period in 2017. Average non-interest-bearing deposits increased $276.9 million to $884.6 million for 2018, compared to $607.7 million in 2017 and accounted for 56.0% of average total deposits in 2018 as compared to 49.0% for the same period in 2017. Average interest-earning assets increased $445.0 million for the year ended December 31, 2018 as compared to the same period in 2017 due primarily to an increase of $360.4 million in average loans and a $91.2 million increase in average overnight deposits.

Asset Quality

Non-performing assets consist of non-accrual loans, accruing loans that are 90 days or more past due, non-accrual troubled debt restructurings and real estate owned ("REO") that has been acquired in partial or full satisfaction of loan obligations or upon foreclosure. The Bank had no REO properties at December 31, 2018 and 2017.


(dollars in thousands)	As of December 31,
(dollars in thousands)	2018			2017
Non-performing assets:
Non-accrual loans:
Commercial	$	-		$	787
One-to-four family		-			2,447
Commercial and industrial		-			-
Consumer		50			155
Total non-accrual loans	$	50		$	3,389
Accruing loans 90 days or more past due		239			-
Total non-performing assets	$	289		$	3,389
Nonaccrual loans as % of loans outstanding		0.00	%		0.24	%

Allowance for loan losses	$	(18,942	)	$	(14,887	)
Allowance for loan losses as % of loans outstanding		1.02	%		1.05	%


	Quarter Ended December 31,						Year Ended December 31,
(dollars in thousands)	2018			2017			2018			2017
Provision for loan losses	$	844		$	3,499		$	3,138		$	7,059
Charge-offs	$	504		$	3,687		$	783		$	3,987
Recoveries	$	(109	)	$	-		$	(1,700	)	$	-
Net charge-offs as % of average loans (annualized)		0.09	%		1.06	%		(0.06	)%		0.32	%

The provision for loan losses was $844,000 for the fourth quarter of 2018 as compared to $3.5 million for the fourth quarter of 2017. This decrease was due primarily to a provision of $3.6 million related to taxi medallion loans in the fourth quarter of 2017. The charge-offs related to these loans amounted to $3.7 million. In 2018, the Bank had a $1.7 million recovery related to the medallion loans. The provision for loan losses for the year ended December 31, 2018 was $3.1 million as compared to $7.1 million for the same period in 2017. This decrease reflects the loan loss recovery in 2018 as well as the taxi medallion charge-off in 2017.


Non-Interest Income
	Quarter Ended December 31,				Year Ended December 31,
(dollars in thousands)	2018		2017		2018			2017
Service charges on deposit accounts	$	826	$	1,820	$	4,248		$	3,452
Prepaid debit card income		1,133		929		4,640			3,369
Other service charges and fees		229		3,429		3,305			4,368
Losses on call of securities		-		-		(37	)		-
Total non-interest income	$	2,188	$	6,178	$	12,156		$	11,189

Non-interest income decreased by $4.0 million to $2.2 million in the fourth quarter of 2018 as compared to the fourth quarter of 2017, primarily due to decreases of $1.0 million in service charges on deposits and $3.2 million in other charges and fees, offset by an increase in debit card income of $204,000. The decrease in service charges on deposits was primarily due to a decline of $0.8 million in wire fees related to transactions by digital currency customers. The decrease in other service charges and fees was due to a decrease in foreign currency conversion fees, which were at an elevated level during the fourth quarter of 2017 and the first quarter of 2018, as customers, particularly those in the digital currency business, were transferring funds from their global corporate accounts back into their U.S. dollar accounts with the Bank.

For the year ended December 31, 2018, non-interest income increased $1.0 million to $12.2 million from $11.2 million in 2017. This increase was primarily due to increases of $0.8 million in service charges on deposits, $1.3 million in prepaid debit card income, offset by a $1.1 million decrease in other service charges and fees when compared to the same period in 2017. The increase in service charges on money market accounts was due primarily to an increase in the number of these accounts. The increase in the prepaid debit card income reflects the growth in the debit card business and a termination fee of $500,000 received in 2018 for a discontinued relationship. The decrease in other service charges and fees was primarily due to a decrease of $1.2 million in foreign currency conversion fees related to digital currency.


Non-interest Expense
(dollars in thousands)	Quarter Ended December 31,				Year Ended December 31,
(dollars in thousands)	2018		2017		2018		2017
Compensation and benefits	$	6,962	$	5,478	$	25,658	$	19,165
Bank premises and equipment		1,324		1,200		5,063		4,385
Professional fees		715		744		2,922		2,544
Data processing fees		1,025		605		3,987		1,592
Other expenses		1,576		1,752		5,841		5,059
Total non-interest expense	$	11,602	$	9,779	$	43,471	$	32,745

Non-interest expense increased $1.8 million to $11.6 million during the fourth quarter of 2018 as compared to $9.8 million for the fourth quarter of 2017. Compensation and benefits increased $1.5 million to $7.0 million for the fourth quarter of 2018 as compared to $5.5 million for the fourth quarter of 2017. This increase was due primarily to an increase of 28 full-time equivalent employees in 2018. In addition, the fourth quarter of 2018 included $353,000 in placement fees related to the hiring of new employees. There were no placement fees incurred in the fourth quarter of 2017. Data processing fees increased $420,000 to $1.0 million for the fourth quarter of 2018 as compared to the fourth quarter of 2017, primarily due to technology costs to support the growth in various deposit verticals.

For the year ended December 31, 2018, non-interest expense increased $10.7 million to $43.5 million as compared to the same period in 2017. Compensation and benefits increased $6.5 million to $25.7 million for the year ended December 31, 2018 as compared to $19.2 million for the same period in 2017. For those same periods, data processing fees increased $2.4 million to $4.0 million due primarily to costs related to wire transfer activity as well as technology costs to support the growth in various deposit verticals.

About Metropolitan Bank Holding Corporation

Metropolitan Bank Holding Corp. 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. Metropolitan Commercial Bank is a New York State chartered commercial bank, 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 certain "forward-looking statements" about the Company which, to the extent applicable, are intended to be covered by the safe harbor for forward-looking statements provided under Federal securities laws and, regardless of such coverage, you are cautioned about. 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 those discussed under the heading "Risk Factors" in our Annual Report on Form 10-K, as well as 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 and unanticipated adverse changes in our customers' economic conditions or economic conditions in our local area in general.

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, whether the result of new information, future events or otherwise.


Consolidated Balance Sheet
(In thousands)	December 31, 2018			December 31, 2017
Assets
Cash and due from banks	$	9,246		$	6,790
Overnight deposits		223,704			254,441
Total cash and cash equivalents		232,950			261,231
Investment securities available for sale		32,549			32,157
Investment securities held to maturity		4,571			5,428
Total securities		37,120			37,585
Other investments		22,287			13,677
Loans, net of deferred fees and unamortized costs		1,865,216			1,419,896
Allowance for loan losses		(18,942	)		(14,887	)
Net loans		1,846,274			1,405,009
Receivable from prepaid card programs, net		8,218			9,579
Accrued interest receivable		5,507			4,421
Premises and equipment, net		6,877			6,268
Prepaid expenses and other assets		8,158			5,751
Goodwill		9,733			9,733
Accounts receivable, net		5,520			6,601
Total assets	$	2,182,644		$	1,759,855
Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing demand deposits	$	798,563		$	812,616
Interest-bearing deposits		861,991			591,739
Total deposits		1,660,554			1,404,355
Federal Home Loan Bank of New York advances		185,000			42,198
Trust preferred securities		20,620			20,620
Subordinated debts, net of issuance cost		24,545			24,489
Accounts payable, accrued expenses and other liabilities		18,439			21,678
Accrued interest payable		1,282			749
Prepaid debit cardholder balances		7,687			8,882
Total liabilities		1,918,127			1,522,971

Class B preferred stock		3			3
Common stock		82			81
Additional paid in capital		213,490			211,145
Retained earnings		51,415			25,861
Accumulated other comprehensive loss, net of tax effect		(473	)		(206	)
Total stockholders' equity		264,517			236,884
Total liabilities and stockholders' equity	$	2,182,644		$	1,759,855


Consolidated Statement of Income (unaudited)
(In thousands, except per share data)	Quarter ended Dec. 31,				Year ended Dec. 31,
(In thousands, except per share data)	2018		2017		2018			2017
Total interest income	$	23,342	$	17,935	$	83,945		$	60,864
Total interest expense		4,381		2,293		12,717			8,671
Net interest income		18,961		15,642		71,228			52,193
Provision for loan losses		844		3,499		3,138			7,059

Net interest income after provision for loan losses		18,117		12,143		68,090			45,134

Non-interest income:
Service charges on deposit accounts		826		1,820		4,248			3,452
Prepaid debit card income		1,133		929		4,640			3,369
Other service charges and fees		229		3,429		3,305			4,368
Losses on call of securities		-		-		(37	)		-
Total non-interest income		2,188		6,178		12,156			11,189

Non-interest expense:
Compensation and benefits		6,962		5,478		25,658			19,165
Bank premises and equipment		1,324		1,200		5,063			4,385
Professional fees		715		744		2,922			2,544
Data processing fees		1,025		605		3,987			1,592
Other expenses		1,576		1,752		5,841			5,059
Total non-interest expense		11,602		9,779		43,471			32,745

Net income before income tax expense		8,703		8,542		36,775			23,578
Income tax expense		2,418		5,216		11,221			11,209
Net income	$	6,285	$	3,326	$	25,554		$	12,369

Earnings per common share:
Basic earnings	$	0.77	$	0.50	$	3.12		$	2.40
Diluted earnings	$	0.75	$	0.49	$	3.06		$	2.34


Summary of Income and Performance Measures Five Quarter Trend (unaudited)

	Quarter Ended
	Dec. 31, 2018			Sept. 30, 2018			June 30, 2018			Mar. 31, 2018			Dec. 31, 2017
(Dollars in thousands, except per share data)
Net interest income	$	18,961		$	18,351		$	17,395		$	16,516		$	15,642
Provision (credit) for loan losses		844			(453	)		1,270			1,477			3,499
Net interest income after provision for loan losses		18,117			18,804			16,125			15,039			12,143
Non-interest income		2,188			2,012			2,649			5,312			6,178
Non-interest expense:
Compensation and benefits		6,962			6,253			6,126			6,317			5,478
Other Expense		4,640			4,102			4,149			4,921			4,301
Total non-interest expense		11,602			10,355			10,275			11,238			9,779

Income before income tax expense		8,703			10,461			8,499			9,113			8,542
Income tax expense		2,418			3,348			2,634			2,822			5,216
Net income		6,285			7,113			5,865			6,291			3,326

Performance Measures:
Net income available to common shareholders		6,238			7,057			5,816			6,238			3,143
Per common share:
Basic earnings	$	0.77		$	0.87		$	0.72		$	0.77		$	0.50
Diluted earnings	$	0.75		$	0.85		$	0.70		$	0.75		$	0.49
Common shares outstanding:
Average - diluted		8,273,220			8,292,385			8,290,048			8,275,243			6,768,753
Period end		8,217,274			8,207,234			8,205,234			8,194,925			8,196,310
Return on (annualized):
Average total assets		1.25	%		1.45	%		1.20	%		1.35	%		0.73	%
Average common equity		9.80	%		11.47	%		9.75	%		10.78	%		7.68	%
Yield on average earning assets		4.65	%		4.49	%		4.13	%		4.17	%		3.98	%
Cost of interest-bearing liabilities		1.90	%		1.69	%		1.46	%		1.31	%		1.25	%
Net interest spread		2.75	%		2.80	%		2.67	%		2.85	%		2.74	%
Net interest margin		3.77	%		3.76	%		3.59	%		3.68	%		3.48	%
Net charge-offs (recoveries) as % of average loans (annualized)		0.09	%		(0.36	)%		0.02	%		0.04	%		1.06	%
Efficiency ratio		54.86	%		50.85	%		51.26	%		51.48	%		44.82	%

Consolidated Balance Sheet Summary Five Quarter Trend (unaudited)
(dollars in thousands)
(dollars in thousands)	Dec. 31, 2018			Sept. 30, 2018			June. 30, 2018			Mar. 31, 2018			Dec. 31, 2017
Assets
Total Assets	$	2,182,644		$	1,930,714		$	1,924,495		$	1,968,886		$	1,759,855
Overnight deposits		223,704			148,260			240,994			363,887			254,441
Total securities		37,120			32,247			33,974			35,488			37,585
Other investments		22,287			16,645			16,770			16,566			13,677
Loans, net of deferred fees and unamortized costs		1,865,216			1,698,929			1,599,647			1,526,166			1,419,896

Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing demand deposits	$	798,563		$	772,754		$	878,703		$	1,012,250		$	812,616
Interest-bearing deposits		861,991			761,177			661,779			604,866			591,739
Total deposits		1,660,554			1,533,931			1,540,482			1,617,116			1,404,355
Borrowings		230,165			105,151			108,137			78,123			87,307
Total stockholders' Equity		264,517			257,269			249,584			243,041			236,884

Asset Quality
Total non-accrual loans	$	50		$	79		$	192		$	85		$	3,389
Total non-performing assets	$	289		$	407		$	192		$	85		$	3,389
Non-accrual loans to total loans		0.00	%		0.00	%		0.01	%		0.01	%		0.24	%
Non-performing loans to total loans		0.02	%		0.02	%		0.01	%		0.01	%		0.24	%
Allowance for loan losses		(18,942	)		(18,493	)		(17,463	)		(16,260	)		(14,887	)
Allowance for loan losses to total loans		1.02	%		1.09	%		1.09	%		1.07	%		1.05	%
Provision for loan losses		844			(453	)		1,270			1,477			3,499
Net charge-offs		395			1,483			67			104			3,687

Regulatory Capital
Tier 1 Leverage:
Metropolitan Bank Holding Corp.		13.7	%		13.8	%		13.5	%		13.7	%		13.7	%
Metropolitan Commercial Bank		14.7			14.8			14.5			14.7			14.7

Common Equity Tier 1 Risk-Based (CET1):
Metropolitan Bank Holding Corp.		13.2			13.9			14.3			14.9			15.3
Metropolitan Commercial Bank		15.7			16.5			17.0			17.7			18.4

Tier 1 Risk-Based:
Metropolitan Bank Holding Corp.		14.6			15.4			15.8			16.5			17.1
Metropolitan Commercial Bank		15.7			16.5			17.0			17.7			18.4

Total Risk-Based:
Metropolitan Bank Holding Corp.		16.9			17.9			18.4			19.2			19.9
Metropolitan Commercial Bank		16.7			17.6			18.1			18.8			19.4

Reconciliation of Quarterly GAAP to Non-GAAP Measures, Five Quarter Trend

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 accompanying tables.


Balance sheet data
Dollars in thousands, except per share data	Dec. 31, 2018		Sept. 30, 2018		June 30, 2018		Mar. 31, 2018		Dec. 31, 2017
Average assets	$	2,015,831	$	1,960,318	$	1,946,910	$	1,869,251	$	1,813,785
Less: average intangible assets		9,733		9,733		9,733		9,733		9,733
Average tangible assets	$	2,006,098	$	1,950,585	$	1,937,177	$	1,859,518	$	1,804,052

Average equity	$	262,030	$	253,516	$	246,108	$	240,250	$	178,747
Less: Average preferred equity		5,502		5,502		5,502		5,502		5,502
Average common equity	$	256,528	$	248,014	$	240,606	$	234,748	$	173,245
Less: average intangible assets		9,733		9,733		9,733		9,733		9,733
Average tangible common equity	$	246,795	$	238,281	$	230,873	$	225,015	$	163,512

Total assets	$	2,182,644	$	1,930,714	$	1,924,495	$	1,968,886	$	1,759,855
Less: intangible assets		9,733		9,733		9,733		9,733		9,733
Tangible assets	$	2,172,911	$	1,920,981	$	1,914,762	$	1,959,153	$	1,750,122

Total Equity	$	264,517	$	257,270	$	249,584	$	243,039	$	236,884
Less: preferred equity		5,502		5,502		5,502		5,502		5,502
Common Equity	$	259,015	$	251,768	$	244,082	$	237,537	$	231,382
Less: intangible assets		9,733		9,733		9,733		9,733		9,733
Tangible common equity (book value)	$	249,282	$	242,035	$	234,349	$	227,804	$	221,649

Common shares outstanding		8,217,274		8,207,234		8,205,234		8,194,925		8,196,310

Book value per share (GAAP)	$	31.52	$	30.68	$	29.75	$	29.23	$	28.23
Tangible book value per common share (non-GAAP)*	$	30.34	$	29.49	$	28.56	$	28.03	$	27.04

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

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