MetroCity Bankshares, Inc. Reports Earnings For Fourth Quarter And Year Ended 2020

·24 min read

ATLANTA, Jan. 22, 2021 /PRNewswire/ -- MetroCity Bankshares, Inc. ("MetroCity" or the "Company") (NASDAQ: MCBS), holding company for Metro City Bank (the "Bank"), today reported net income of $9.5 million, or $0.37 per diluted share, for the fourth quarter of 2020, compared to $9.4 million, or $0.36 per diluted share, for the third quarter of 2020, and $10.7 million, or $0.42 per diluted share, for the fourth quarter of 2019. For the year ended December 31, 2020, the Company reported net income of $36.4 million, or $1.41 per diluted share, compared to $44.7 million, or $1.81 per diluted share, for the year ended December 31, 2019.

MetroCity Logo (PRNewsfoto/MetroCity Bankshares)
MetroCity Logo (PRNewsfoto/MetroCity Bankshares)

Fourth Quarter 2020 Highlights:

  • Annualized return on average assets was 2.14%, compared to 2.20% for the third quarter of 2020 and 2.57% for the fourth quarter of 2019.

  • Annualized return on average equity was 15.78%, compared to 16.22% for the third quarter of 2020 and 20.40% for the fourth quarter of 2019.

  • Efficiency ratio of 45.1%, compared to 42.5% for the third quarter of 2020 and 40.5% for the fourth quarter of 2019.

  • Total assets increased by $156.3 million, or 9.0%, to $1.90 billion from the previous quarter.

  • Total loans increased by $170.4 million, or 11.7%, to $1.63 billion from the previous quarter.

  • Total deposits increased by $142.1 million, or 10.6%, to $1.48 billion from the previous quarter.

  • Net interest margin increased to 4.46%, compared to 3.97% for the third quarter of 2020 and 3.82% for the fourth quarter of 2019.

Full Year 2020 Highlights:

  • Return on average assets was 2.17%, compared to 2.87% for 2019.

  • Return on average equity was 16.02%, compared to 24.23% for 2019.

  • Efficiency ratio was 44.0%, compared to 39.7% for 2019.

  • Total assets increased by $264.3 million, or 16.2%, to $1.90 billion from $1.63 billion at December 31, 2019.

  • Total loans, excluding loans held for sale, increased by $469.2 million, or 40.4%, to $1.63 billion from $1.16 billion at December 31, 2019.

  • Total deposits increased by $172.5 million, or 13.2%, to $1.48 billion from $1.31 billion at December 31, 2019.

  • Net interest margin increased to 4.18% compared to 4.15% in 2019.

COVID-19 Pandemic

The Company prioritizes the health and safety of its employees and customers, and continues to take protective measures during the ongoing coronavirus (COVID-19) pandemic, such as implementing remote work arrangements to the fullest extent possible and by adjusting banking center hours and operational measures to promote social distancing. At the same time, the Company continues to closely monitor the effects of the COVID-19 pandemic on our loan and deposit customers, and is assessing the risks in our loan portfolio and working with our customers to reduce the pandemic's impact on them while minimizing losses for the Company. Meanwhile, the Company remains focused on improving shareholder value, managing credit exposure, monitoring expenses, enhancing the customer experience and supporting the communities it serves.

We have implemented loan programs to allow customers who are experiencing hardships from the COVID-19 pandemic to defer loan principal and interest payments for up to nine months. The Small Business Administration (the "SBA") made debt relief payments for the principal, interest and fee payments of all our SBA loan customers for six months through the end of September 2020. As of December 31, 2020, we had 14 non-SBA commercial customers with outstanding loan balances totaling $42.0 million who were approved for a third round of payment deferrals. This is a decline from the second round of payment deferrals that were granted to 24 non-SBA commercial customers with outstanding balances totaling $82.5 million as of September 30, 2020. Included in the third round of non-SBA payment deferrals were eight loans totaling $24.2 million with a weighted average loan-to-value ("LTV") of 44.2% in the hotel industry and no loans in the restaurant industry, which are two industries heavily impacted by the COVID-19 pandemic. As of December 31, 2020 and following the expiration of the SBA debt relief payments mentioned above, we had approved three month payment deferrals for 18 SBA loans with outstanding gross loan balances totaling $25.5 million ($6.4 million unguaranteed book balance). Of these SBA payment deferrals, four loans totaling $6.0 million ($1.5 million unguaranteed book balance) were in the restaurant industry and no loans were in the hotel industry. As of December 31, 2020, the Company had 51 loans totaling $141.2 million in the hotel industry and 116 loans totaling $36.1 million in the restaurant industry.

As of December 31, 2020, our residential real estate loan portfolio made up 59.6% of our total loan portfolio and had a weighted average amortized LTV of approximately 55.6%. As of December 31, 2020, 1.0% of our residential mortgages remain on hardship payment deferral covering principal and interest payments for three to six months. This is a significant decrease from the first round of payment deferrals granted during the second quarter of 2020, which made up 19.2% of our residential mortgage balances as of June 30, 2020, and a slight decrease from the second round of payment deferrals granted during the third quarter of 2020, which made up 1.7% of our residential mortgage balances as of September 30, 2020.

As a preferred SBA lender, we are participating in the Paycheck Protection Program ("PPP") created under the Coronavirus Aid, Relief and Economic Security Act and implemented by the SBA to help provide loans to our business customers in need. As of December 31, 2020, the Company approved and funded over 1,800 PPP loans totaling $96.9 million. These PPP loans were funded with our current cash balances and all PPP loans are fully guaranteed by the SBA. As of January 20, 2020, the SBA had granted forgiveness for PPP loans totaling $8.4 million.

The Economic Aid Act, signed into law on December 27, 2020, authorized an additional $284.5 billion in new PPP funding and extends the authority of lenders to make PPP loans through March 31, 2021. We are participating in this new round of PPP loan funding by offering first and second draw loans.

Based on the Company's capital levels as of December 31, 2020, conservative underwriting policies, low LTV ratios, and strong liquidity position, management expects to be able to continue to assist the Company's customers and communities during these difficult times, manage the economic risks and uncertainties associated with the COVID-19 pandemic and remain well capitalized.

Results of Operations

Net Income

Net income was $9.5 million for the fourth quarter of 2020, a slight increase of $69,000, or 0.7%, from $9.4 million for the third quarter of 2020. This increase was primarily due to an increase in net interest income of $2.5 million and a decrease in provision for loan losses of $494,000, offset by a decrease in noninterest income of $1.8 million and an increase in noninterest expense of $927,000. Net income decreased $1.2 million, or 11.4%, in the fourth quarter of 2020 compared to net income of $10.7 million for the fourth quarter of 2019. This decrease was primarily due to a decrease in noninterest income of $3.2 million, an increase in noninterest expense of $1.2 million and an increase in provision for loan losses of $1.0 million, offset by an increase in net interest income of $3.5 million and a decrease in provision for income taxes of $715,000.

Net Interest Income and Net Interest Margin

Interest income totaled $19.8 million for the fourth quarter of 2020, an increase of $1.7 million, or 9.4%, from the previous quarter, primarily due to a nine basis points increase in the yield on average loans and a $114.5 million increase in average loan balances. We also recognized PPP loan fee income of $518,000 during the fourth quarter of 2020. During the third quarter of 2020, we reevaluated the estimated life of our PPP loan fee amortization period, extending it from nine months to 24 months due to the uncertainty in the PPP loan forgiveness process. As compared to the fourth quarter of 2019, interest income for the fourth quarter of 2020 decreased by $786,000, or 3.8%, primarily due to a 90 basis points decrease in the yield on average loans.

Interest expense totaled $1.4 million for the fourth quarter of 2020, a decrease of $781,000, or 35.6%, from the previous quarter, primarily due to a 39 basis points decrease in deposit costs and a $64.5 million decrease in higher cost average time deposits. As compared to the fourth quarter of 2019, interest expense for the fourth quarter of 2020 decreased by $4.3 million, or 75.2%, primarily due to a 160 basis points decrease in deposit costs coupled with a $324.6 million decrease in higher cost average time deposits.

The net interest margin for the fourth quarter of 2020 was 4.46% compared to 3.97% for the previous quarter, an increase of 49 basis points. The cost of interest-bearing liabilities for the fourth quarter of 2020 decreased by 35 basis points to 0.56% compared with the previous quarter, while the yield on interest-earning assets for the fourth quarter of 2020 increased by 29 basis points to 4.80% from 4.51% for the previous quarter. Average earning assets increased by $46.6 million from the previous quarter, primarily due to an increase in average loans of $114.5 million, partially offset by a $35.6 million decrease in average interest-earning cash accounts and a $32.2 million decrease in average securities purchased under agreements to resell. Average interest-bearing liabilities increased by $40.5 million from the previous quarter as average interest-bearing deposits increased by $36.9 million and average borrowings increased by $3.6 million. The inclusion of PPP loan average balances, interest and fees had a 12 basis points impact on the yield on average loans and a seven basis points impact on the net interest margin for the fourth quarter of 2020.

As compared to the same period in 2019, the net interest margin for the fourth quarter of 2020 increased by 64 basis points to 4.46% from 3.82%, primarily due to a 150 basis point decrease in the cost of interest-bearing liabilities of $995.3 million and a decrease of 47 basis points in the yield on average interest-earning assets of $1.65 billion. Average earning assets for the fourth quarter of 2020 increased by $92.7 million from the fourth quarter of 2019, primarily due to a $242.9 million increase in average loans, partially offset by a $145.2 million decrease in interest-earning cash accounts. Average interest-bearing liabilities for the fourth quarter of 2020 decreased by $98.6 million from the fourth quarter of 2019, primarily driven by a decrease in average interest-bearing deposits of $124.2 million, offset by an increase in average borrowings of $25.6 million.

Noninterest Income

Noninterest income for the fourth quarter of 2020 was $6.1 million, a decrease of $1.8 million, or 22.9%, from the third quarter of 2020, primarily due to lower mortgage and SBA servicing income and gains on sale of SBA loans, partially offset by higher mortgage loan fees as mortgage volume significantly increased during the quarter. During the fourth quarter of 2020, we recorded a $524,000 fair value adjustment charge on our SBA servicing asset and a $199,000 fair value impairment charge on our mortgage servicing asset. These servicing asset adjustments had a $0.02 per share impact on our diluted earnings per share for the quarter.

Compared to the same period in 2019, noninterest income for the fourth quarter of 2020 decreased by $3.2 million, or 34.4%, primarily due to the decrease in mortgage servicing income and gains earned from the sales of mortgage loans. There were no mortgage loan sales during the fourth quarter of 2020 compared to mortgage loan sales of $106.5 million during the same period in 2019.

Noninterest Expense

Noninterest expense for the fourth quarter of 2020 totaled $11.1 million, an increase of $927,000, or 9.1%, from $10.2 million for the third quarter of 2020. This increase was primarily attributable to higher salaries and employee benefits and loan related expenses. Compared to the fourth quarter of 2019, noninterest expense during the fourth quarter of 2020 increased by $1.2 million, or 12.6%, primarily due to higher salaries and employee benefits.

The Company's efficiency ratio was 45.1% for the fourth quarter of 2020 compared to 42.5% and 40.5% for the third quarter of 2020 and fourth quarter of 2019, respectively. For the year ended December 31, 2020, the efficiency ratio was 44.0% compared with 39.7% for the same period in 2019.

Income Tax Expense

The Company's effective tax rate for the fourth quarter of 2020 was 24.6%, compared to 23.7% for the third quarter of 2020 and 26.2% for the fourth quarter of 2019. The effective tax rate for the year ended December 31, 2020 was 25.4% compared to 26.5% for the year ended December 31, 2019.

Balance Sheet

Total Assets

Total assets were $1.90 billion at December 31, 2020, an increase of $156.3 million, or 9.0%, from $1.74 billion at September 30, 2020, and an increase of $264.3 million, or 16.2%, from $1.63 billion at December 31, 2019. The $156.3 million increase in total assets from at December 31, 2020 compared to September 30, 2020 was primarily due to increases in loans of $170.4 million and cash and due from banks of $31.5 million, partially offset by a $40.0 million decrease in securities purchased under agreements to resell. The $264.3 million increase in total assets at December 31, 2020 compared to December 31, 2019 was primarily due to increases in loans held for investment of $469.2 million and bank owned life insurance of $15.6 million, partially offset by decreases in cash and due from banks of $129.8 million, securities purchased under agreements to resell of $15.0 million and loans held for sale of $85.8 million.

Loans

Loans held for investment were $1.63 billion at December 31, 2020, an increase of $170.4 million, or 11.7%, compared to $1.46 billion at September 30, 2020, and an increase of $469.2 million, or 40.4%, compared to $1.16 billion at December 31, 2019. The increase in loans held for investment at December 31, 2020 compared to September 30, 2020 was primarily due to a $143.1 million increase in residential mortgages, a $29.8 million increase in commercial real estate loans and a $7.0 million increase in construction and development loans, offset by a $9.6 million decrease in commercial and industrial loans. Included in commercial and industrial loans are PPP loans totaling $92.4 million as of December 31, 2020. There were no loans classified as held for sale at December 31, 2020 and September 30, 2020. Loans held for sale were $85.8 million at December 31, 2019.

Deposits

Total deposits were $1.48 billion at December 31, 2020, an increase of $142.1 million, or 10.6%, compared to total deposits of $1.34 billion at September 30, 2020, and an increase of $172.5 million, or 13.2%, compared to total deposits of $1.31 billion at December 31, 2019. The increase in total deposits at December 31, 2020 compared to September 30, 2020 was primarily due to the $147.2 million increase in money market accounts and a $7.7 million increase in interest-bearing demand deposits, partially offset by a $16.5 million decrease in time deposits. The increase in money market accounts was partially due to the addition of $122.3 million in brokered money market accounts during the quarter.

Noninterest-bearing deposits were $462.9 million at December 31, 2020, compared to $460.7 million at September 30, 2020 and $292.0 million at December 31, 2019. Noninterest-bearing deposits constituted 31.3% of total deposits at December 31, 2020, compared to 34.4% at September 30, 2020 and 22.3% at December 31, 2019. Interest-bearing deposits were $1.0 billion at December 31, 2020, compared to $877.1 million at September 30, 2020 and $1.0 billion at December 31, 2019. Interest-bearing deposits constituted 68.7% of total deposits at December 31, 2020, compared to 65.6% at September 30, 2020 and 77.7% at December 31, 2019.

Asset Quality

The Company recorded a provision for loan losses of $956,000 during the fourth quarter of 2020. Annualized net charge-offs to average loans for the fourth quarter of 2020 was 0.04%, compared to 0.00% for both the third quarter of 2020 and fourth quarter of 2019. We continue to include qualitative factors in our allowance for loan losses calculation in light of the continued economic uncertainties caused by the ongoing COVID-19 pandemic, resulting in the increased provision expense recorded during the fourth quarter of 2020. The Company is not required to implement the provisions of the current expected credit losses accounting standard issued by the Financial Accounting Standards Board in the Accounting Standards Update No. 2016-13 until January 1, 2023, and is continuing to account for the allowance for loan losses under the incurred loss model.

Nonperforming assets totaled $16.9 million, or 0.89% of total assets, at December 31, 2020, a decrease of $561,000 from $17.5 million, or 1.01% of total assets, at September 30, 2020, and an increase of $1.8 million from $15.1 million, or 0.93% of total assets, at December 31, 2019. The decrease in nonperforming assets at December 31, 2020 compared to September 30, 2020 was primarily due to a $4.6 million decrease in accruing troubled debt restructured loans, partially offset by a $473,000 increase in nonaccrual loans and $3.6 million increase in other real estate owned.

Allowance for loan losses as a percentage of total loans was 0.62% at December 31, 2020, compared to 0.64% at September 30, 2020 and 0.59% at December 31, 2019. Excluding outstanding PPP loans of $92.4 million as of December 31, 2020 and $96.9 million as of September 30, 2020, the allowance for loan losses as a percentage of total loans was 0.66% at December 31, 2020 and 0.68% at September 30, 2020. Allowance for loan losses as a percentage of nonperforming loans was 77.40% at December 31, 2020, compared to 54.24% and 46.54% at September 30, 2020 and December 31, 2019, respectively.

About MetroCity Bankshares, Inc.

MetroCity Bankshares, Inc. is a Georgia corporation and a registered bank holding company for its wholly-owned banking subsidiary, Metro City Bank, which is headquartered in the Atlanta, Georgia metropolitan area. Founded in 2006, Metro City Bank currently operates 19 full-service branch locations in multi-ethnic communities in Alabama, Florida, Georgia, New York, New Jersey, Texas and Virginia. To learn more about Metro City Bank, visit www.metrocitybank.bank.

Forward-Looking Statements

Statements in this press release regarding future events and our expectations and beliefs about our future financial performance and financial condition, as well as trends in our business and markets, including statements regarding the potential effects of the ongoing COVID-19 pandemic on our business and financial results and conditions, constitute "forward-looking statements" within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are not historical in nature and may be identified by references to a future period or periods of by the use of the words "believe," "expect," "anticipate," "intend," "plan," "estimate," "project," "outlook," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." The forward-looking statements in this press release should not be relied on because they are based on current information and on assumptions that we make about future events and circumstances that are subject to a number of known and unknown risks and uncertainties that are often difficult to predict and beyond our control. As a result of those risks and uncertainties, and other factors, our actual financial results in the future could differ, possibly materially, from those expressed in or implied by the forward-looking statements contained in this press release and could cause us to make changes to our future plans. Factors that might cause such differences include, but are not limited to: general business and economic conditions, particularly those affecting the financial services; the impact of the ongoing COVID-19 pandemic on the Company's assets, business, cash flows, financial condition, liquidity, prospects and results of operations; potential increases in the provision for loan losses resulting from the ongoing COVID-19 pandemic; changes in the interest rate environment, including changes to the federal funds rate; competition in our markets that may result in increased funding costs or reduced earning assets yields, thus reducing margins and net interest income; interest rate fluctuations, which could have an adverse effect on the Company's profitability; legislation or regulatory changes which could adversely affect the ability of the consolidated Company to conduct business combinations or new operations, including changes to statutes, regulations or regulatory policies or practices as a result of, or in response to, the ongoing COVID-19 pandemic; changes in tax laws; and adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions, including as a result of the Company's participation in and execution of government programs related to the ongoing COVID-19 pandemic. Therefore, the Company can give no assurance that the results contemplated in the forward-looking statements will be realized. Additional information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained in the sections titled "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors" in the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q on file with the U.S. Securities and Exchange Commission (the "SEC"), and in other documents that we file with the SEC from time to time, which are available on the SEC's website, http://www.sec.gov. In addition, our actual financial results in the future may differ from those currently expected due to additional risks and uncertainties of which we are not currently aware or which we do not currently view as, but in the future may become, material to our business or operating results. Due to these and other possible uncertainties and risks, readers are cautioned not to place undue reliance on the forward-looking statements contained in this press release or to make predictions based solely on historical financial performance. Any forward-looking statement speaks only as of the date on which it is made, and we do not undertake any obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. All forward-looking statements, express or implied, included in this press release are qualified in their entirety by this cautionary statement.

Contacts




Farid Tan

Lucas Stewart

President & Chief Financial Officer

Chief Accounting Officer

770-455-4978

678-580-6414

faridtan@metrocitybank.bank

lucasstewart@metrocitybank.bank


METROCITY BANKSHARES, INC.

SELECTED FINANCIAL DATA


























As of and for the Three Months Ended


As of and for the Year Ended




December 31,


September 30,


June 30,


March 31,


December 31,


December 31,


December 31,


(Dollars in thousands, except per share data)


2020


2020


2020


2020


2019


2020


2019


Selected income statement data:























Interest income


$

19,839


$

18,131


$

19,083


$

20,556


$

20,625


$

77,609


$

83,213


Interest expense



1,411



2,192



3,240



4,646



5,681



11,489



22,238


Net interest income



18,428



15,939



15,843



15,910



14,944



66,120



60,975


Provision for loan losses



956



1,450



1,061







3,467




Noninterest income



6,138



7,964



5,500



7,509



9,360



27,211



39,896


Noninterest expense



11,077



10,150



9,724



10,049



9,840



41,100



40,003


Income tax expense



3,079



2,918



2,819



3,554



3,794



12,370



16,150


Net income



9,454



9,385



7,739



9,816



10,670



36,394



44,718


Per share data:























Basic income per share


$

0.37


$

0.37


$

0.30


$

0.38


$

0.42


$

1.42


$

1.82


Diluted income per share


$

0.37


$

0.36


$

0.30


$

0.38


$

0.42


$

1.41


$

1.81


Dividends per share


$

0.09


$

0.09


$

0.11


$

0.11


$

0.11


$

0.40


$

0.42


Book value per share (at period end)


$

9.54


$

9.23


$

8.94


$

8.76


$

8.49


$

9.54


$

8.49


Shares of common stock outstanding



25,674,573



25,674,067



25,674,067



25,529,891



25,529,891



25,674,573



25,529,891


Weighted average diluted shares



25,870,885



25,858,741



25,717,339



25,736,435



25,586,733



25,798,549



24,729,535


Performance ratios:























Return on average assets



2.14

%


2.20

%


1.89

%


2.44

%


2.57

%


2.17

%


2.87

%

Return on average equity



15.78



16.22



13.92



18.21



20.40



16.02



24.23


Dividend payout ratio



24.60



24.78



36.53



28.80



26.49



28.32



23.26


Yield on total loans



5.14



5.05



5.69



6.11



6.04



5.47



6.14


Yield on average earning assets



4.80



4.51



4.93



5.42



5.27



4.91



5.66


Cost of average interest bearing liabilities



0.56



0.91



1.32



1.78



2.06



1.15



2.15


Cost of deposits



0.55



0.94



1.38



1.86



2.15



1.20



2.19


Net interest margin



4.46



3.97



4.09



4.19



3.82



4.18



4.15


Efficiency ratio(1)



45.09



42.46



45.56



42.91



40.49



44.04



39.66


Asset quality data (at period end):























Net charge-offs/(recoveries) to average loans held for investment



0.04

%


0.00

%


0.01

%


(0.01)

%


0.00

%


0.02

%


(0.02)

%

Nonperforming assets to gross loans and OREO



1.03



1.19



1.00



1.13



1.30



1.03



1.30


ALL to nonperforming loans



77.40



54.24



59.66



49.47



46.54



77.40



46.54


ALL to loans held for investment



0.62



0.64



0.58



0.54



0.59



0.62



0.59


Balance sheet and capital ratios:























Gross loans held for investment to deposits



110.48

%


109.50

%


101.48

%


101.67

%


88.97

%


110.48

%


88.97

%

Noninterest bearing deposits to deposits



31.28



34.44



33.28



25.83



22.34



31.28



22.34


Common equity to assets



12.91



13.63



13.32



13.94



13.28



12.91



13.28


Leverage ratio



13.44



13.44



13.44



13.40



12.70



13.44



12.70


Common equity tier 1 ratio



20.02



21.09



21.75



21.75



21.31



20.02



21.31


Tier 1 risk-based capital ratio



20.02



21.09



21.75



21.75



21.31



20.02



21.31


Total risk-based capital ratio



20.88



21.96



22.53



22.44



22.01



20.88



22.01


Mortgage and SBA loan data:























Mortgage loans serviced for others


$

961,670


$

1,063,500


$

1,136,824


$

1,186,825


$

1,168,601


$

961,670


$

1,168,601


Mortgage loan production



194,951



120,337



48,850



120,076



112,259



484,214



644,465


Mortgage loan sales









92,737



106,548



92,737



520,067


SBA loans serviced for others



507,442



500,047



476,629



464,576



441,593



507,442



441,593


SBA loan production



34,631



52,742



114,899



43,447



30,763



245,719



155,035


SBA loan sales



25,505



37,923



35,247



29,958



30,065



128,633



118,405


_______________________________________

(1) Represents noninterest expense divided by the sum of net interest income plus noninterest income.


METROCITY BANKSHARES, INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)














...






As of the Quarter Ended



December 31,


September 30,


June 30,


March 31,


December 31,

(Dollars in thousands, except per share data)


2020


2020


2020


2020


2019

ASSETS
















Cash and due from banks


$

140,744


$

109,263


$

208,325


$

201,020


$

270,496

Federal funds sold



9,944



17,268



7,444



6,618



5,917

Cash and cash equivalents



150,688



126,531



215,769



207,638



276,413

Securities purchased under agreements to resell





40,000



40,000



40,000



15,000

Securities available for sale (at fair value)



18,117



18,204



18,415



18,182



15,695

Loans



1,630,344



1,459,899



1,364,989



1,261,603



1,161,162

Allowance for loan losses



(10,135)



(9,339)



(7,894)



(6,859)



(6,839)

Loans less allowance for loan losses



1,620,209



1,450,560



1,357,095



1,254,744



1,154,323

Loans held for sale











85,793

Accrued interest receivable



9,320



7,999



8,270



5,534



5,101

Federal Home Loan Bank stock



6,147



5,723



4,873



4,873



3,842

Premises and equipment, net



13,854



14,083



14,231



14,344



14,460

Operating lease right-of-use asset



10,348



10,786



11,220



11,663



11,957

Foreclosed real estate, net



3,844



282



423



423



423

SBA servicing asset, net



9,643



10,173



8,446



7,598



8,188

Mortgage servicing asset, net



12,991



14,599



16,064



16,791



18,068

Bank owned life insurance



35,806



35,578



20,450



20,335



20,219

Other assets



5,171



5,355



6,501



2,417



2,376

Total assets


$

1,896,138


$

1,739,873


$

1,721,757


$

1,604,542


$

1,631,858

















LIABILITIES
















Noninterest-bearing deposits


$

462,909


$

460,679


$

449,185


$

320,982


$

292,008

Interest-bearing deposits



1,016,980



877,112



900,713



921,899



1,015,369

Total deposits



1,479,889



1,337,791



1,349,898



1,242,881



1,307,377

Federal Home Loan Bank advances



110,000



100,000



80,000



80,000



60,000

Other borrowings



483



491



3,060



3,097



3,129

Operating lease liability



10,910



11,342



11,769



12,198



12,476

Accrued interest payable



222



310



549



760



890

Other liabilities



49,803



52,843



47,060



41,871



31,262

Total liabilities


$

1,651,307


$

1,502,777


$

1,492,336


$

1,380,807


$

1,415,134

















SHAREHOLDERS' EQUITY
















Preferred stock











Common stock



257



257



257



255



255

Additional paid-in capital



55,674



55,098



54,524



54,142



53,854

Retained earnings



188,705



181,576



174,518



169,606



162,616

Accumulated other comprehensive income (loss)



195



165



122



(268)



(1)

Total shareholders' equity



244,831



237,096



229,421



223,735



216,724

Total liabilities and shareholders' equity


$

1,896,138


$

1,739,873


$

1,721,757


$

1,604,542


$

1,631,858

METROCITY BANKSHARES, INC.

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

























Three Months Ended


Year Ended



December 31,


September 30,


June 30,


March 31,


December 31,


December 31,


December 31,

(Dollars in thousands, except per share data)


2020


2020


2020


2020


2019


2020


2019

Interest and dividend income:






















Loans, including Fees


$

19,658


$

17,880


$

18,826


$

19,508


$

19,483


$

75,872


$

79,338

Other investment income



164



187



196



882



1,023



1,429



3,294

Federal funds sold



17



64



61



166



119



308



581

Total interest income



19,839



18,131



19,083



20,556



20,625



77,609



83,213























Interest expense:






















Deposits



1,262



2,046



3,096



4,514



5,576



10,918



21,951

FHLB advances and other borrowings



149



146



144



132



105



571



287

Total interest expense



1,411



2,192



3,240



4,646



5,681



11,489



22,238























Net interest income



18,428



15,939



15,843



15,910



14,944



66,120



60,975























Provision for loan losses



956



1,450



1,061







3,467

























Net interest income after provision for loan losses



17,472



14,489



14,782



15,910



14,944



62,653



60,975























Noninterest income:






















Service charges on deposit accounts



350



309



277



376



386



1,312



1,462

Other service charges, commissions and fees



3,223



2,076



990



2,256



2,290



8,545



10,121

Gain on sale of residential mortgage loans









2,529



2,687



2,529



9,141

Mortgage servicing income, net



(82)



235



783



372



2,046



1,308



9,294

Gain on sale of SBA loans



1,625



2,265



1,276



1,301



1,148



6,467



5,444

SBA servicing income, net



724



2,931



1,959



516



665



6,130



3,745

Other income



298



148



215



259



138



920



689

Total noninterest income



6,138



7,964



5,500



7,609



9,360



27,211



39,896























Noninterest expense:






















Salaries and employee benefits



6,822



6,416



5,749



6,513



5,997



25,500



24,923

Occupancy



1,293



1,302



1,277



1,211



1,202



5,083



4,749

Data Processing



313



287



201



277



264



1,078



1,029

Advertising



138



127



140



161



194



566



649

Other expenses



2,511



2,018



2,357



1,987



2,183



8,873



8,653

Total noninterest expense



11,077



10,150



9,724



10,149



9,840



41,100



40,003























Income before provision for income taxes



12,533



12,303



10,558



13,370



14,464



48,764



60,868

Provision for income taxes



3,079



2,918



2,819



3,554



3,794



12,370



16,150

Net income available to common shareholders


$

9,454


$

9,385


$

7,739


$

9,816


$

10,670


$

36,394


$

44,718


METROCITY BANKSHARES, INC.

AVERAGE BALANCES AND YIELDS/RATES





























Three Months Ended




December 31, 2020


September 30, 2020


December 31, 2019




Average


Interest and


Yield /


Average


Interest and


Yield /


Average


Interest and


Yield /


(Dollars in thousands)


Balance


Fees


Rate


Balance


Fees


Rate


Balance


Fees


Rate


Earning Assets:


























Federal funds sold and other investments(1)


$

97,228


$

70


0.29

%

$

132,781


$

87


0.26

%

$

242,388


$

954


1.56

%

Securities purchased under agreements to resell



7,826



13


0.66



40,000



61


0.61



15,000



87


2.30


Securities available for sale



17,983



98


2.17



18,161



103


2.26



15,823



101


2.53


Total investments



123,037



181


0.59



190,942



251


0.52



273,211



1,142


1.66


Construction and development



34,145



453


5.28



33,587



414


4.90



30,508



472


6.14


Commercial real estate



488,746



6,779


5.52



476,174



6,547


5.47



471,667



8,069


6.79


Commercial and industrial



138,021



1,376


3.97



139,083



870


2.49



48,664



820


6.69


Residential real estate



860,977



11,018


5.09



757,982



10,002


5.25



726,671



10,075


5.50


Consumer and other



261



32


48.78



844



47


22.15



1,778



47


10.49


Gross loans(2)



1,522,150



19,658


5.14



1,407,670



17,880


5.05



1,279,288



19,483


6.04


Total earning assets



1,645,187



19,839


4.80



1,598,612



18,131


4.51



1,552,499



20,625


5.27


Noninterest-earning assets



111,078








96,234








94,805







Total assets



1,756,265








1,694,846








1,647,304







Interest-bearing liabilities:


























NOW and savings deposits



78,697



41


0.21



73,299



42


0.23



51,259



40


0.31


Money market deposits



346,193



328


0.38



250,200



341


0.54



173,223



773


1.77


Time deposits



482,162



893


0.74



546,648



1,663


1.21



806,764



4,763


2.34


Total interest-bearing deposits



907,052



1,262


0.55



870,147



2,046


0.94



1,031,246



5,576


2.15


Borrowings



88,208



149


0.67



84,564



146


0.69



62,610



105


0.67


Total interest-bearing liabilities



995,260



1,411


0.56



954,711



2,192


0.91



1,093,856



5,681


2.06


Noninterest-bearing liabilities:


























Noninterest-bearing deposits



453,984








445,970








291,260







Other noninterest-bearing liabilities



68,702








64,045








54,652







Total noninterest-bearing liabilities



522,686








510,015








345,912







Shareholders' equity



238,319








230,120








207,536







Total liabilities and shareholders' equity


$

1,756,265







$

1,694,846







$

1,647,304







Net interest income





$

18,428







$

15,939







$

14,944




Net interest spread








4.24








3.60








3.21


Net interest margin








4.46








3.97








3.82


______________________________________

(1)

Includes income and average balances for term federal funds sold, interest-earning cash accounts and other miscellaneous interest-earning assets.

(2)

Average loan balances include nonaccrual loans and loans held for sale.

METROCITY BANKSHARES, INC.

AVERAGE BALANCES AND YIELDS/RATES





















Year Ended




December 31, 2020


December 31, 2019




Average


Interest and


Yield /


Average


Interest and


Yield /


(Dollars in thousands)


Balance


Fees


Rate


Balance


Fees


Rate


Earning Assets:


















Federal funds sold and other investments(1)


$

147,431


$

1,056


0.72

%

$

145,096


$

3,010


2.07

%

Securities purchased under agreements to resell



29,932



271


0.91



15,000



421


2.81


Securities available for sale



17,806



410


2.30



17,413



444


2.55


Total investments



195,169



1,737


0.89



177,509



3,875


2.18


Construction and development



31,658



1,685


5.32



33,567



2,193


6.53


Commercial real estate



478,481



27,316


5.71



458,259



31,927


6.97


Commercial and industrial



112,313



5,301


4.72



43,003



3,049


7.09


Residential real estate



763,136



41,391


5.42



755,244



41,962


5.56


Consumer and other



989



179


18.10



2,310



207


8.96


Gross loans(2)



1,386,577



75,872


5.47



1,292,383



79,338


6.14


Total earning assets



1,581,746



77,609


4.91



1,469,892



83,213


5.66


Noninterest-earning assets



98,504








86,106







Total assets



1,680,250








1,555,998







Interest-bearing liabilities:


















NOW and savings deposits



68,610



166


0.24



51,818



172


0.33


Money market deposits



248,633



1,731


0.70



133,363



2,730


2.05


Time deposits



596,325



9,021


1.51



816,298



19,049


2.33


Total interest-bearing deposits



913,568



10,918


1.20



1,001,479



21,951


2.19


Borrowings



82,955



571


0.69



31,884



287


0.90


Total interest-bearing liabilities



996,523



11,489


1.15



1,033,363



22,238


2.15


Noninterest-bearing liabilities:


















Noninterest-bearing deposits



394,338








297,174







Other noninterest-bearing liabilities



62,153








40,924







Total noninterest-bearing liabilities



456,491








338,098







Shareholders' equity



227,236








184,537







Total liabilities and shareholders' equity


$

1,680,250







$

1,555,998







Net interest income





$

66,120







$

60,975




Net interest spread








3.76








3.51


Net interest margin








4.18








4.15


_______________________________________

(1)

Includes income and average balances for term federal funds sold, interest-earning cash accounts and other miscellaneous interest-earning assets.

(2)

Average loan balances include nonaccrual loans and loans held for sale.

METROCITY BANKSHARES, INC.

LOAN DATA