#USA #Atlanta #Earnings #MetroCity Bank

MetroCity Bankshares, Inc. Third Quarter 2024 Earnings Report

On January 21, 2025, MetroCity Bankshares, Inc. reported its financial performance for the fourth quarter and the year ending December 31, 2024. The holding company for Metro City Bank, listed on NASDAQ under the symbol MCBS, has shown significant resilience and growth in its financial metrics despite a variable economic landscape.

Fourth Quarter Highlights

For the fourth quarter of 2024, the company reported a net income of $16.2 million, translating to $0.63 per diluted share. This reflects a slight decrease from the third quarter's income of $16.7 million or $0.65 per share, but a notable increase when compared to $11.3 million or $0.44 per share from the same quarter last year.

Key performance indicators include:

• - Annualized return on average assets: 1.82%, down from 1.86% in Q3 2024, yet higher than 1.29% in Q4 2023.
• - Annualized return on average equity: 15.84%, a decrease from 16.26% in Q3 but a rise from 11.71% in Q4 2023.
• - Efficiency ratio: 40.5%, up from 37.0% in the prior quarter but lower than 45.1% from a year earlier.
• - Net interest margin: Stable at 3.57%, slightly down from 3.58% in Q3 2024, yet a significant improvement compared to 3.17% from Q4 2023.
• - Loans held for investment increased to $3.16 billion, a 2.3% rise from the previous quarter.

Year-End Performance

The full-year results were equally impressive, showcasing a net income of $64.5 million, or $2.52 per diluted share, compared to $51.6 million or $2.02 per diluted share in 2023. This represented a robust year-on-year growth driven by:

• - Increased net interest income, which surged by $16.7 million.
• - A profit margin improvement indicated by a return on average assets of 1.81% and a return on average equity of 16.16%, up from 14.10% in 2023.
• - Total assets also increased by 2.6%, amounting to $3.59 billion.

Operations Breakdown

Delving deeper into the operational figures reveals:

• - Interest Income reached $52.6 million for Q4, down 2.3% from Q3, but up 3.8% year-on-year.
• - Interest Expense dropped by 4.2% from the previous quarter, chiefly due to decreasing deposit costs.
• - The total noninterest income of $5.3 million for Q4 represented a 19.6% decrease from Q3, impacted particularly by lower sales from SBA and mortgage loans, despite higher servicing income.
• - Noninterest Expense rose to $14.3 million, primarily driven by higher employee salaries and benefits.

Income Tax and Balance Sheet Insights

The effective tax rate for Q4 2024 was reported at 22.1%, down from 26.3% in the prior quarter. The balance sheet also portrayed a strong foundation with total assets rising significantly and a controlled allowance for credit losses, reflecting robust asset quality.

Total nonperforming assets accounted for 0.51% of total assets, where the allowance for credit losses stood at 0.59% of total loans, providing a solid buffer against potential loan defaults.

Company Outlook

Metro City Bank has established itself as a stable player within its markets, with a notable presence across several states including Georgia, Alabama, Florida, and Texas. Analysts and stakeholders remain optimistic about its growth strategy, particularly in multi-ethnic communities, which can be pivotal for future growth.

In conclusion, MetroCity Bank has exhibited commendable financial health and management effectiveness throughout 2024, setting a promising trajectory as it moves forward into the next fiscal year.