Market Overview

John Marshall Bancorp, Inc. Reports Mid-Year Financial Results

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John Marshall Bancorp, Inc. (OTCQB:JMSB) (the "Company") reported net
income of $3.1 million for the three months ended June 30, 2018, an
increase of $396 thousand, or 14.6%, as compared to net income of $2.7
million for the three months ended June 30, 2017. Net income per diluted
share was $0.23 per share during the second quarter of 2018, compared to
$0.20 per diluted share during the same period in 2017, as adjusted for
the 5 for 4 stock split in the form of a 25% dividend paid September 5,
2017. For the three months ended June 30, 2018, the Company produced a
0.99% return on average assets and 9.30% on average equity, compared to
1.00% and 8.74%, for the second quarter of 2017.

The Company reported net income of $6.3 million for the six months ended
June 30, 2018, an increase of $1.1 million, or 21.6%, compared to $5.2
million for the six months ended June 30, 2017. Net income per diluted
share was $0.47 during the first six months of 2018, compared to $0.38
per diluted share during the same period in 2017, as adjusted for the 5
for 4 stock split in the form of a 25% dividend paid September 5, 2017.
For the six months ended June 30, 2018, the Company produced a 1.04%
return on average assets and 9.68% on average equity, compared to 0.97%
and 8.59%, during the same period in 2017.

As of June 30, 2018, the Company's tangible book value per share was
$10.49, up 7.6% compared to $9.75 as of June 30, 2017, as adjusted for
the 5 for 4 stock split in the form of a 25% dividend paid September 5,
2017. The Company's effective income tax rate decreased 38.5% for the
six months ended June 30, 2018, compared to the six months ended June
30, 2017, due to the federal corporate tax rate reduction that was
effective January 1, 2018.

The Company's capital ratios remain well above regulatory minimums for
well capitalized banks. As of June 30, 2018, the Company's total
risk-based capital ratio was 14.9%, compared to 12.3% at June 30, 2017.

Balance Sheet Review

Total assets were $1.23 billion at June 30, 2018, $1.18 billion at
December 31, 2017 and $1.12 billion at June 30, 2017. During the first
six months of 2018 assets increased $53.1 million, or 4.5%.
Year-over-year asset growth, from June 30, 2017 to June 30, 2018, was
$109.7 million, or 9.8%. Gross loans were $1.040 billion at June 30,
2018, $1.009 billion at December 31, 2017 and $942.5 million at June 30,
2017. During the first six months of 2018 gross loans increased $31.5
million, or 3.1%. Year-over-year gross loans increased $97.8 million, or
10.4% from June 30, 2017 to June 30, 2018. Loan originations were strong
with $28.0 million of net growth in gross loans during the second
quarter of 2018.

The Company's investment portfolio comprised of held-to-maturity and
available-for-sale securities was $95.6 million at June 30, 2018, $96.3
million at December 31, 2017 and $83.8 million at June 30, 2017.
Year-over-year the investment portfolio growth, from June 30, 2017 to
June 30, 2018, was $11.8 million, or 14.1%. The growth in the investment
portfolio was due to strong deposit growth discussed below. As of June
30, 2018, the Company held $39.9 million of its investment portfolio as
held-to-maturity, and $55.7 million as available-for-sale. The Company
also had restricted securities totaling $8.1 million at June 30, 2018,
$8.4 million at December 31, 2017 and $8.1 million at June 30, 2017.
Interest-bearing deposits in banks were $54.6 million at June 30, 2018,
$30.9 million at December 31, 2017 and $49.4 million at June 30, 2017.
At June 30, 2018, the estimated fair value of bank owned life insurance
was $19.4 million, compared to $19.1 million at December 31, 2017 and
$18.8 million at June 30, 2017.

Total deposits were $974.4 million at June 30, 2018, $896.9 million at
December 31, 2017 and $878.8 million at June 30, 2017. During the first
six months of 2018, deposits increased $77.5 million, or 8.6%.
Year-over-year deposit growth, from June 30, 2017 to June 30, 2018, was
$95.6 million, or 10.9%. Core customer funding was $906.0 million at
June 30, 2018, $829.8 million at December 31, 2017 and $816.1 million at
June 30, 2017. Year-over-year core customer funding sources, which
include deposits, customer repurchase agreements, ICS and CDARs,
increased by $89.9 million, or 11.0%, from June 30, 2017 to June 30,
2018. Over the past year, the Company has implemented several strategic
initiatives to grow core deposits and loans, including new locations and
additional staff, as discussed in the non-interest expense section.

CDARs were $98.1 million at June 30, 2018, $77.5 million at December 31,
2017 and $83.6 million at June 30, 2017. Year-over-year CDARs increased
$14.5 million. Brokered deposits were $43.0 million at June 30, 2018,
$42.4 million at December 31, 2017 and $43.0 million at June 30, 2017.
The Company had $81.1 million in ICS deposits as of June 30, 2018, $65.3
million at December 31, 2017 and $60.9 million as of June 30, 2017.

QwickRate certificates of deposit were $25.5 million at June 30, 2018,
$24.7 million at December 31, 2017 and $22.4 million at June 30, 2017.
Year-over-year QwickRate certificates of deposit increased $3.0 million
from June 30, 2017 to June 30, 2018. Year-over-year, brokered deposits
were unchanged from June 30, 2017 to June 30, 2018. There were no
customer repurchase agreements at June 30, 2018 and December 31, 2017
and $2.7 million at June 30, 2017.

Total borrowings, consisting of Federal Home Loan Bank advances,
customer repurchase agreements and Federal funds purchased, were $89.5
million at June 30, 2018, $118.5 million at December 31, 2017 and $109.7
million at June 30, 2017. Year-over-year total borrowings decreased
$20.2 million, or 18.4% from June 30, 2017 to June 30, 2018. Federal
Home Loan Bank advances were $89.5 million at June 30, 2018, $108.5
million at December 31, 2017 and $107.0 million at June 30, 2017.
Year-over-year Federal Home Loan Bank advances decreased $17.5 million
or 16.4%, from June 30, 2017 to June 30, 2018. The Company decreased
borrowings as a result of the significant growth in core customer
deposits. The Company had subordinated notes with a balance of $24.6
million at June 30, 2018 and $24.5 million at December 31, 2017. The
notes qualify as Tier 2 capital for the Company for regulatory purposes.

Total shareholders' equity was $135.0 million at June 30, 2018, $128.9
million at December 31, 2017 and $124.8 million at June 30, 2017.
Year-over-year shareholders' equity increased by $10.1 million, or 8.1%.
Total common shares outstanding increased from 10,243,141, including
67,020 unvested shares, at June 30, 2017, to 12,871,125, including
86,125 unvested shares, at June 30, 2018. The majority of the increase
in shares year-over-year was related to the 5 for 4 stock split in the
form of a 25% dividend paid September 5, 2017.

Income Statement Review

Net interest income

Net interest income, the Company's primary source of revenue, was $10.8
million for the three months ended June 30, 2018, up 7.0% from $10.1
million for the three months ended June 30, 2017. The net interest
margin was 3.52% for the three months ended June 30, 2018 as compared to
3.82% for the three months ended June 30, 2017. Average net loans
increased $80.6 million with a 14 basis point increase in yield and
average interest-bearing deposits in other banks increased $77.9 million
with a 71 basis point increase in yield when comparing the quarter ended
June 30, 2017 to the quarter ended June 30, 2018. While the higher
interest-bearing deposit balances impacted the margin during the second
quarter of 2018, the Company anticipates that these funds will be
deployed into higher earning assets. The average cost of interest
bearing liabilities increased 41 basis points when comparing the quarter
ended June 30, 2017 to the quarter ended June 30, 2018. The increase in
the cost of interest bearing liabilities year-over-year was primarily
related to the Company's issuance of subordinated debt which contributed
13 basis points to the increase as well as the higher costs of time
deposits and money market accounts. During the twelve months ended June
30, 2018, the Federal Reserve increased rates by 100 basis points to a
target of 2.0%.

For the six months ended June 30, 2018, net interest income was $21.2
million, up 7.7% from $19.7 million for the six months ended June 30,
2017. The net interest margin was 3.56% during the first six months of
2018, compared to 3.78% during the first six months of 2017. Despite the
decline in the net interest margin over the past year, net interest
income increased by 7.7% during the first six months of 2018, compared
to the first six months of 2017, resulting primarily from a $151.0
million, or 14.4%, increase in average earning assets during the first
six months of 2018, compared to the first six months of 2017.

Provision for loan losses

The Company had no provision for loan losses for the three months ended
June 30, 2018, compared to a provision of $380 thousand for the same
period in 2017. The Company reported net loan charge-offs of $85
thousand in the second quarter of 2018, compared to net loan recoveries
of $8 thousand in the second quarter of 2017. During the second quarter
2018, the need for additional provisions for loan losses on new loan
volume were offset when one non-accrual loan with a specific reserve was
paid down.

During the first six months of 2018, the Company recognized a provision
for loan losses of $190 thousand, compared to a provision of $645
thousand during the first six months of 2017. The Company reported $86
thousand in net loan charge-offs during the first six months of 2018,
compared to $14 thousand in net loan recoveries during the first six
months of 2017.

Noninterest income

The Company's noninterest income consists primarily of bank owned life
insurance income and service charges on deposit accounts. Loan fees are
included in interest income on the loan portfolio and not reported as
noninterest income.

For the three months ended June 30, 2018, the Company reported total
noninterest income of $294 thousand, compared to $310 thousand during
the three months ended June 30, 2017, a decrease of $16 thousand, or
5.2%.

For the six months ended June 30, 2018, the Company reported total
noninterest income of $628 thousand, compared to $658 thousand during
the first six months of 2017, a decrease of $30 thousand, or 4.6%.

The year-over-year decrease for both the three and six month periods
ended June 30, 2018 was primarily attributable to gains on sales of
securities totaling $130 thousand during the first and second quarters
of 2017. There was no gain on sale of securities during the first six
months of 2018. Service charges on deposit accounts increased $25
thousand, or 27.5%, for the three months ended June 30, 2018 and $42
thousand, or 22.3%, for the six months ended June 30, 2018 as compared
to the same periods in the prior year. The increase in other service
charges and fees for both the three and six month periods ended June 30,
2018 was related to higher fees earned on the higher CDARs balances.

Noninterest expense

The Company reached $1.2 billion in total assets in a little over 12
years solely through organic growth. One of the key platforms of the
Company's growth strategy is to hire experienced local banking
professionals with successful track records and established customer
relationships. The Company made several investments in its future growth
over the past six months. The Company expects that the increases in
noninterest expenses will drive significant growth in assets and
profitability.

For the three months ended June 30, 2018, salaries and employee benefits
expense increased 30.4% to $4.6 million, compared to $3.5 million for
the same period in 2017. All other noninterest expenses increased by
8.3% during the second quarter of 2018, compared to the same period in
2017.

During the first six months of 2018, salaries and employee benefits
expense increased by 22.1%, to $8.7 million, compared to $7.2 million
during the first six months of 2017. All other operating expenses
increased by 5.1%, or $238 thousand, to $4.9 million, during the first
six months of 2018, compared to $4.6 million during the first six months
of 2017.

The increase in salaries and benefits for both the three and six month
periods ended June 30, 2018 was primarily attributable to the addition
of 10 staff positions year-over-year including staff for our loan
production office in Arlington, Virginia that opened in December 2017,
our full service branch in Washington, DC which opened in January 2018,
the Tysons Corner, Virginia loan production office converting to a full
service branch in the fall of 2018 and a loan production office in
Prince William County, Virginia to open in the fall of 2018 as well. In
addition to the staff needed at our new locations, we hired key
executives, loan and business development officers as well as support
staff in our operations office. The new employees are complementary to
the overall growth initiatives for the Company. The increase in
occupancy and furniture and equipment expenses was mostly related to
additional rent and furniture expense related to the new full service
branch in Washington, DC and the additional loan production office in
Arlington, Virginia.

Asset Quality Review

As of June 30, 2018, non-performing assets were 0.06% of total assets,
compared to 0.30% at June 30, 2017. The Company's allowance for loan
losses covered non-performing loans by 23.2 times as of June 30, 2018,
compared to 2.6 times as of June 30, 2017. As of June 30, 2018,
non-accrual loans totaled $390 thousand, an 88.5% decrease from $3.4
million at June 30, 2017. As of June 30, 2018, there were $726 thousand
in loans 30-89 days past due and still accruing interest and $108
thousand as of June 30, 2017. The $726 thousand past due balance was
comprised of two loans that matured and were in the process of renewal.

Troubled debt restructurings were $488 thousand at June 30, 2018, a
decrease of $13 thousand, or 2.6%, from $501 thousand at June 30, 2017.
All troubled debt restructurings were performing in accordance with
modified terms as of June 30, 2018. The Company had $379 thousand in
other real estate owned as of June 30, 2018 and December 31, 2017 and no
other real estate owned as of June 30, 2017.

John Marshall Bancorp, Inc. is the bank holding company for John
Marshall Bank. John Marshall Bank is headquartered in Reston, Virginia
and has six full-service banking centers located in Reston, Leesburg,
Arlington and Alexandria, Virginia; Rockville, Maryland; Washington,
DC., and a seventh branch in Tysons Corner scheduled to open late fall.
A loan production office is scheduled to open in Prince William County
in the fall of 2018 as well. Virginia. Further information on the Bank
can be obtained by visiting its website at www.johnmarshallbank.com.

This press release contains forward-looking statements within the
meaning of the Securities and Exchange Act of 1934, as amended,
including statements of goals, intentions, and expectations as to future
trends, plans, events or results of Company operations and policies and
regarding general economic conditions. In some cases, forward-looking
statements can be identified by use of words such as "may," "will,"
"anticipates," "believes," "expects," "plans," "estimates," "potential,"
"continue," "should," and similar words or phrases. These statements are
based upon current and anticipated economic conditions, nationally and
in the Company's market, interest rates and interest rate policy,
competitive factors, and other conditions which by their nature, are not
susceptible to accurate forecast, and are subject to significant
uncertainty. Because of these uncertainties and the assumptions on which
this discussion and the forward-looking statements are based, actual
future operations and results may differ materially from those indicated
herein. Readers are cautioned against placing undue reliance on any such
forward-looking statements. The Company's past results are not
necessarily indicative of future performance.

   
John Marshall Bancorp, Inc.
     
Consolidated Balance Sheets
(Dollar amounts in thousands, except per share data)
 
% Change
June 30, December 31, June 30, Last Six Year Over
2018 2017 2017 Months Year
Assets (Unaudited) (Unaudited) (Unaudited)
 
Cash and due from banks $ 5,482 $ 7,256 $ 9,998 -24.4 % -45.2 %
Federal funds sold 76 40 60 90.0 % 26.7 %
Interest-bearing deposits in banks 54,593 30,873 49,390 76.8 % 10.5 %
Securities available-for-sale, at fair value 55,654 54,699 42,006 1.7 % 32.5 %

Securities held-to-maturity, fair value of $39,066 at 6/30/2018,
$41,500 at 12/31/2017 and $42,096 at 6/30/2017

39,931 41,570 41,791 -3.9 % -4.5 %
Restricted securities, at cost 8,115 8,447 8,071 -3.9 % 0.5 %

Loans, net of allowance for loan losses of $9,031 at 6/30/2018,
$8,927 at 12/31/2017 and $8,861 at 6/30/2017

1,029,408 997,945 931,885 3.2 % 10.5 %
Bank premises and equipment, net 2,496 2,480 2,760 0.6 % -9.6 %
Accrued interest receivable 3,282 3,263 2,818 0.6 % 16.5 %
Bank owned life insurance 19,353 19,093 18,814 1.4 % 2.9 %
Other real estate owned 379 379 - - 0.0 % N/M
Other assets   9,366     8,980     10,824   4.3 % -13.5 %
 
Total assets $ 1,228,135   $ 1,175,025   $ 1,118,417   4.5 % 9.8 %
 
Liabilities and Shareholders' Equity
 
Liabilities
Deposits:
Non-interest bearing demand deposits $ 206,098 $ 174,686 $ 167,920 18.0 % 22.7 %
Interest bearing demand deposits 288,918 258,306 267,585 11.9 % 8.0 %
Savings deposits 6,697 6,709 7,436 -0.2 % -9.9 %
Time deposits   472,727     457,240     435,893   3.4 % 8.5 %
Total deposits 974,440 896,941 878,834 8.6 % 10.9 %
Federal funds purchased - - 10,001 - - N/M N/M
Repurchase agreements - - - - 2,723 N/M N/M
Federal Home Loan Bank advances 89,500 108,500 107,000 -17.5 % -16.4 %
Subordinated debt 24,556 24,531 - - 0.1 % N/M
Accrued interest payable 1,149 996 255 15.4 % 350.6 %
Other liabilities   3,509     5,189     4,760   -32.4 % -26.3 %
Total liabilities   1,093,154     1,046,158     993,572   4.5 % 10.0 %
 
Shareholders' Equity

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

- - - - - - - - - -

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

- - - - - - - - - -

Common stock, voting, par value $0.01 per share; authorized
20,000,000 shares; issued and outstanding, 12,871,125 at 6/30/2018
including 86,125 unvested shares, 12,824,233 shares at 12/31/2017
including 85,007 unvested shares and 10,243,141 at 6/30/17,
including 67,020 unvested shares

128 127 102 0.8 % 25.5 %
Additional paid-in capital 84,469 83,867 83,386 0.7 % 1.3 %
Retained earnings 51,774 45,544 41,669 13.7 % 24.3 %
Accumulated other comprehensive loss   (1,390 )   (671 )   (312 ) -107.2 % -345.5 %
 
Total shareholders' equity   134,981     128,867     124,845   4.7 % 8.1 %
 
Total liabilities and shareholders' equity $ 1,228,135   $ 1,175,025   $ 1,118,417   4.5 % 9.8 %
 
 
John Marshall Bancorp, Inc.
Consolidated Statements of Income
           
(Dollar amounts in thousands, except per share data)
 
Three Months Ended Six Months Ended
June 30, June 30,
2018 2017 % Change 2018 2017 % Change
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Interest and Dividend Income
Interest and fees on loans $ 12,733 $ 11,398 11.7 % $ 25,169 $ 22,210 13.3 %
Interest on investment securities, taxable 418 336 24.4 % 832 697 19.4 %
Interest on investment securities, tax-exempt 83 53 56.6 % 168 105 60.0 %
Dividends 128 105 21.9 % 242 203 19.2 %
Interest on deposits in banks   474   74 540.5 %   706   153 361.4 %
Total interest and dividend income   13,836   11,966 15.6 %   27,117   23,368 16.0 %
 
Interest Expense
Deposits 2,343 1,563 49.9 % 4,411 3,037 45.2 %
Federal Home Loan Bank advances 363 341 6.5 % 774 642 20.6 %
Subordinated debt 371 - - N/M 743 - - N/M
Other short-term borrowings   - -   8 N/M     2   20 -90.0 %
Total interest expense   3,077   1,912 60.9 %   5,930   3,699 60.3 %
 
Net interest income 10,759 10,054 7.0 % 21,187 19,669 7.7 %
 
Provision for loan losses   - -   380 N/M     190   645 -70.5 %
 
Net interest income after provision for loan losses   10,759   9,674 11.2 %   20,997   19,024 10.4 %
 
Noninterest Income
Service charges on deposit accounts 116 91 27.5 % 230 188 22.3 %
Bank owned life insurance 130 135 -3.7 % 261 275 -5.1 %
Other service charges and fees 41 30 36.7 % 122 54 125.9 %
Gain on sale of securities - - 54 N/M - - 130 N/M
Other real estate owned 5 - - N/M 11 - - N/M
Gain on sale of fixed assets - - - - N/M - - 1 N/M
Other operating income   2   - - N/M     4   10 -60.0 %
Total noninterest income   294   310 -5.2 %   628   658 -4.6 %
 
Noninterest Expenses
Salaries and employee benefits 4,584 3,516 30.4 % 8,732 7,152 22.1 %
Occupancy expense of premises 476 463 2.8 % 987 898 9.9 %
Furniture and equipment expenses 323 286 12.9 % 625 563 11.0 %
Other operating expenses   1,735   1,590 9.1 %   3,259   3,172 2.7 %
Total noninterest expenses   7,118   5,855 21.6 %   13,603   11,785 15.4 %
 
Income before income taxes 3,935 4,129 -4.7 % 8,022 7,897 1.6 %
 
Income tax expense   835

 

  1,425 -41.4 %   1,678

 

  2,682 -37.4 %
 
Net income $ 3,100 $ 2,704 14.6 % $ 6,344 $ 5,215 21.6 %
 
Earnings Per Share
Basic $ 0.24 $ 0.21 14.3 % $ 0.49 $ 0.41 19.5 %
Diluted $ 0.23 $ 0.20 15.0 % $ 0.47 $ 0.38 23.7 %
 
               
John Marshall Bancorp, Inc.
 
Loan, Deposit and Borrowing Detail (Unaudited)
(Dollar amounts in thousands)
 
June 30, 2018 December 31, 2017 June 30, 2017 Percentage Change
Loans $ Amount % of Total $ Amount % of Total $ Amount % of Total Last 6 Mos Last 12 Mos
Mortgage loans on real estate
Commercial $ 648,004 62.3 % $ 577,016 57.1 % $ 552,960 58.7 % 12.3 % 17.2 %
Construction and land development 199,787 19.2 % 218,538 21.7 % 190,090 20.2 % -8.6 % 5.1 %
Residential   135,689   13.0 %   135,791   13.5 %   118,087   12.5 % -0.1 % 14.9 %
Total mortgage loans on real estate $ 983,480 94.5 % $ 931,345 92.3 % $ 861,137 91.4 % 5.6 % 14.2 %
Commercial loans 55,201 5.4 % 76,573 7.6 % 79,960 8.5 % -27.9 % -31.0 %
Consumer loans   1,524   0.1 %   777   0.1 %   1,358   0.1 % 96.1 % 12.2 %
Total loans $ 1,040,205 100.0 % $ 1,008,695 100.0 % $ 942,455 100.0 % 3.1 % 10.4 %
Less: Allowance for loan losses (9,031 ) (8,927 ) (8,861 )
Net deferred loan fees   (1,766 )   (1,823 )   (1,709 )
Net loans $ 1,029,408   $ 997,945   $ 931,885  
 
 
June 30, 2018 December 31, 2017 June 30, 2017 Percentage Change
Deposits $ Amount % of Total $ Amount % of Total $ Amount % of Total Last 6 Mos Last 12 Mos
Noninterest-bearing demand deposits $ 206,098 21.2 % $ 174,686 19.5 % $ 167,920 19.1 % 18.0 % 22.7 %
Interest-bearing demand deposits:
NOW accounts 37,205 3.8 % 33,505 3.7 % 40,511 4.6 % 11.0 % -8.2 %
Money market accounts 170,643 17.5 % 159,508 17.8 % 156,201 17.8 % 7.0 % 9.2 %
Savings accounts 6,697 0.7 % 6,709 0.8 % 7,436 0.9 % -0.2 % -9.9 %
Certificates of deposit
$250,000 or more 195,830 20.1 % 199,161 22.2 % 190,210 21.6 % -1.7 % 3.0 %
Less than $250,000 110,357 11.3 % 113,374 12.6 % 106,683 12.1 % -2.7 % 3.4 %
QwickRate® Certificates of deposit 25,471 2.6 % 24,735 2.8 % 22,434 2.6 % 3.0 % 13.5 %
ICS® 81,071 8.3 % 65,293 7.3 % 60,852 6.9 % 24.2 % 33.2 %
CDARS® 98,089 10.1 % 77,531 8.6 % 83,573 9.5 % 26.5 % 17.4 %
Brokered deposits   42,979   4.4 %   42,439   4.7 %   43,014   4.9 % 1.3 % -0.1 %
Total deposits $ 974,440   100.0 % $ 896,941   100.0 % $ 878,834   100.0 % 8.6 % 10.9 %
 
Borrowings
Federal funds purchased $ - - N/M $ 10,001 7.0 % $ - - N/M N/M N/M
Customer repurchase agreements - - N/M - - N/M 2,723 2.5 % N/M N/M
Federal Home Loan Bank advances 89,500 78.5 % 108,500 75.9 % 107,000 97.5 % -17.5 % -16.4 %
Subordinated debt   24,556   21.5 %   24,531   17.1 %   - -   N/M   0.1 % N/M  
Total borrowings $ 114,056   100.0 % $ 143,032   100.0 % $ 109,723   100.0 % -20.3 % 3.9 %
 
Total deposits and borrowings $ 1,088,496   $ 1,039,973   $ 988,557   4.7 % 10.1 %
 
Core customer funding sources (1) $ 905,990 83.2 % $ 829,767 79.8 % $ 816,109 82.6 % 9.2 % 11.0 %
Wholesale funding sources (2) 157,950 14.5 % 185,675 17.9 % 172,448 17.4 % -14.9 % -8.4 %
Subordinated debt (3)   24,556   2.3 %   24,531   2.3 %   - -   N/M   0.1 % N/M  
Total funding sources $ 1,088,496   100.0 % $ 1,039,973   100.0 % $ 988,557   100.0 % 4.7 % 10.1 %
 
(1)   Includes ICS and CDARS(r), which are all reciprocal deposits
maintained by customers, and repurchase agreements, which represent
sweep accounts tied to customer operating accounts.
(2) Consists of QwickRate(r) certificates of deposit, brokered deposits
and Federal Home Loan Bank advances.
(3) Subordinated debt obligation qualifies as Tier 2 capital.
 
 
John Marshall Bancorp, Inc.
Average Balance Sheets, Interest and Rates (unaudited)
(Dollar amounts in thousands)
           
Three Months Ended June 30, 2018 Three Months Ended June 30, 2017
Interest Average Interest Average
Average Income- Yields Average Income- Yields
Balance Expense /Rates Balance Expense /Rates
Assets
Securities $ 103,833 $ 629 2.43 % $ 93,167 $ 494 2.13 %
Loans, net of unearned income 1,016,173 12,733 5.03 % 935,582 11,398 4.89 %
Interest-bearing deposits in other banks 104,798 474 1.81 % 26,937 74 1.10 %
Federal funds sold   65   - - N/M     58   - - N/M  
Total interest-earning assets $ 1,224,869 $ 13,836 4.53 % $ 1,055,743 $ 11,966 4.55 %
Other assets   32,346   32,421
Total assets $ 1,257,215 $ 1,088,164
Liabilities & Shareholders' equity
Interest-bearing deposits
NOW accounts $ 70,471 $ 81 0.46 % $ 50,386 $ 41 0.33 %
Money market accounts 221,677 441 0.80 % 192,987 268 0.56 %
Savings accounts 7,096 4 0.23 % 7,385 4 0.22 %
Time deposits   478,612   1,817 1.52 %   423,612   1,250 1.18 %
Total interest-bearing deposits $ 777,856 $ 2,343 1.21 % $ 674,371 $ 1,563 0.93 %

Securities sold under agreement to repurchase and federal funds
purchased

$ - - $ - - N/M $ 5,622 $ 8 0.57 %
Subordinated debt 24,548 371 6.06 % - - - - N/M
Other borrowed funds   93,616   363 1.56 %   110,374   341 1.24 %
Total interest-bearing liabilities $ 896,020 $ 3,077 1.38 % $ 790,367 $ 1,912 0.97 %
Demand deposits and other liabilities   227,553   173,734
Total liabilities $ 1,123,573 $ 964,101
Shareholders' equity   133,642   124,063
Total liabilities and shareholders' equity $ 1,257,215 $ 1,088,164
Interest rate spread 3.15 % 3.58 %
Net interest income and margin $ 10,759 3.52 % $ 10,054 3.82 %
 
 
Six Months Ended June 30, 2018 Six Months Ended June 30, 2017
Interest Average Interest Average
Average Income- Yields Average Income- Yields
Balance Expense /Rates Balance Expense /Rates
Assets
Securities $ 104,418 $ 1,242 2.40 % $ 94,523 $ 1,005 2.14 %
Loans, net of unearned income 1,012,771 25,169 5.01 % 921,842 22,210 4.86 %
Interest-bearing deposits in other banks 82,537 706 1.72 % 32,366 153 0.95 %
Federal funds sold   63   - - N/M     57   - - N/M  
Total interest-earning assets $ 1,199,789 $ 27,117 4.56 % $ 1,048,788 $ 23,368 4.49 %
Other assets   31,760   32,152
Total assets $ 1,231,549 $ 1,080,940
Liabilities & Shareholders' equity
Interest-bearing deposits
NOW accounts $ 64,346 $ 136 0.43 % $ 38,813 $ 56 0.29 %
Money market accounts 216,078 825 0.77 % 200,433 522 0.53 %
Savings accounts 6,975 8 0.23 % 7,312 8 0.23 %
Time deposits   473,980   3,442 1.46 %   423,982   2,450 1.17 %
Total interest-bearing deposits $ 761,379 $ 4,411 1.17 % $ 670,540 $ 3,037 0.91 %

Securities sold under agreement to repurchase and federal funds
purchased

$ 166 $ 2 2.43 % $ 9,229 $ 20 0.44 %
Subordinated debt 24,542 743 6.11 % - - - - N/M
Other borrowed funds   103,815   774 1.50 %   106,840   642 1.21 %
Total interest-bearing liabilities $ 889,902 $ 5,930 1.34 % $ 786,609 $ 3,699 0.95 %
Demand deposits and other liabilities   209,467   171,865
Total liabilities $ 1,099,369 $ 958,474
Shareholders' equity   132,180   122,466
Total liabilities and shareholders' equity $ 1,231,549 $ 1,080,940
Interest rate spread 3.22 % 3.54 %
Net interest income and margin $ 21,187 3.56 % $ 19,669 3.78 %
 
 
John Marshall Bancorp, Inc.
Financial Highlights (Unaudited)
(Dollar amounts in thousands, except per share data)
       
At or For the Three Months Ended At or For the Six Months Ended
June 30, June 30,
2018 2017 2018 2017
Per share Data and Shares Outstanding(1)
Earnings per share - basic $ 0.24 $ 0.21 $ 0.49 $ 0.41
Earnings per share - diluted $ 0.23 $ 0.20 $ 0.47 $ 0.38
Tangible book value per share $ 10.49 $ 9.75 $ 10.49 $ 9.75
Weighted average common shares (basic) 12,777,343 12,713,798 12,771,488 12,700,987
Weighted average common shares (diluted) 13,537,089 13,421,654 13,524,384 13,485,320
Common shares outstanding at end of period 12,871,125 12,803,926 12,871,125 12,803,926
 
Performance Ratios
Return on average assets (annualized) 0.99 % 1.00 % 1.04 % 0.97 %
Return on average equity (annualized) 9.30 % 8.74 % 9.68 % 8.59 %
Yield on earning assets (annualized) 4.53 % 4.55 % 4.56 % 4.49 %
Cost of interest bearing liabilities (annualized) 1.38 % 0.97 % 1.34 % 0.95 %
Net interest spread 3.15 % 3.58 % 3.22 % 3.54 %
Net interest margin 3.52 % 3.82 % 3.56 % 3.78 %
Noninterest income as a percentage of average assets (annualized) 0.09 % 0.11 % 0.10 % 0.12 %
Noninterest expense to average assets (annualized) 2.27 % 2.16 % 2.23 % 2.20 %
Efficiency ratio 64.4 % 56.5 % 62.4 % 58.0 %
 
Asset Quality
Loans 30-89 days past due and accruing interest $ 726 $ 108 $ 726 $ 108
Non-accrual loans $ 390 $ 3,396 $ 390 $ 3,396
Other real estate owned $ 379 $ - - $ 379 $ - -
Non-performing assets (2) $ 769 $ 3,396 $ 769 $ 3,396
Non-performing assets to total assets 0.06 % 0.30 % 0.06 % 0.30 %
Allowance for loan losses to total loans 0.87 % 0.94 % 0.87 % 0.94 %
Allowance for loan losses to non-performing loans 23.2 2.6 23.2 2.6
Net loan chargeoffs (recoveries) $ 85 $ (8 ) $ 86 $ (14 )
Net charge-offs to average loans (annualized) 0.03 % 0.00 % 0.02 % 0.00 %
Troubled debt restructurings (total) $ 488 $ 501 $ 488 $ 501
Performing in accordance with modified terms $ 488 $ 501 $ 488 $ 501
Not performing in accordance with modified terms $ - - $ - - $ - - $ - -
 
Regulatory Capital Ratios
Total risk-based capital ratio 14.9 % 12.3 % 14.9 % 12.3 %
Tier 1 risk-based capital ratio 12.0 % 11.5 % 12.0 % 11.5 %
Leverage ratio 10.8 % 11.5 % 10.8 % 11.5 %
Common equity tier 1 ratio 12.0 % 11.5 % 12.0 % 11.5 %
 
Other Information
Effective income tax rate 21.2 % 34.5 % 20.9 % 34.0 %
Tangible equity / tangible assets 11.0 % 11.2 % 11.0 % 11.2 %
Average tangible equity / average tangible assets 10.6 % 11.4 % 10.7 % 11.3 %
Number of full time equivalent employees 133 123 133 123
# Full service branch offices 6 5 6 5
# Loan production or limited service branch offices 2 2 2 2
 
(1)   Shares and per share amounts for all periods have been adjusted to
reflect a 5 for 4 stock split in the form of a 25% stock dividend
paid September 5, 2017.
(2) Non-performing assets consist of non-accrual loans, loans 90 day or
more past due and still accruing interest, and other real estate
owned. Does not include troubled debt restructurings ("TDRs") which
were accruing interest at the date indicated.
 

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