Market Overview

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

Share:

Metropolitan Bank Holding Corp. (NYSE: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,
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

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

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,
      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,
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. (NYSE:MCB) is the holding company for
Metropolitan Commercial Bank. The Bank provides a broad range of
business, commercial and personal banking products and services to small
and middle-market businesses, public entities and affluent individuals
in the New York metropolitan area. Founded in 1999, the Bank is
headquartered in New York City and operates six locations in Manhattan,
Brooklyn and Great Neck, Long Island. The Bank is also an active issuer
of debit cards for third-party debit card programs. 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,
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)                        
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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