John Marshall Bank’s Financial Condition Remains Strong
Excellent Asset Quality, Robust Liquidity and Well-Capitalized Balance Sheet
RESTON, Va. — John Marshall Bancorp, Inc. (Nasdaq: JMSB) (the “Company”), parent company of John Marshall Bank (the “Bank”) is providing an update on certain unaudited information pertaining to the Bank’s financial condition.
On Friday, March 10, 2023, Silicon Valley Bank (“SVB”) was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation (“FDIC”) as receiver. The Company is issuing this release to inform our shareholders as well as the customers and employees of the Bank that we are of sound financial condition, our business model differs materially from that of SVB’s and, from what we have deduced from Call Report data and SVB reports, the factors related to their being placed into receivership by the FDIC are, we believe, a function of their unique business model.
SVB was headquartered in Santa Clara, California. Among other segments, SVB provided financial services to startup (early-stage) and venture capital companies. As disclosed in SVB’s Strategic Actions/Q1’23 Mid-Quarter Update published March 8, 2023, venture capital investing slowed dramatically over the past three quarters. Absent capital inflows and in the face of rising interest rates, SVB’s client cash consumption was approximately twice as high as pre-2021 levels. SVB’s deposits declined 12.5% from March 31, 2022 to December 31, 2022. During that same period of time, SVB’s borrowings increased from less than 1% of equity to greater than 100% of equity.
John Marshall Bank has a long history of financial strength with a conservative operating philosophy. As of February 28, 2023, the Bank was well-capitalized with a 16.0% total risk-based capital ratio, up from 15.6% at December 31, 2022 and well in excess of the highest 10.5% regulatory requirement (inclusive of the capital conservation buffer). For the past thirteen consecutive quarters, the Bank has had no non-performing assets or loans which were more than 30 days past due. Our asset quality remains excellent. As of February 28, 2023, the Bank continued to have no non-performing assets or loans which were more than 30 days past due. The Bank increased deposits 4.3% from March 31, 2022 to December 31, 2022. Deposits have increased from $2.071 billion as of December 31, 2022 to $2.076 billion as of March 10, 2023. As of March 10, 2023, the Bank had no borrowings. At December 31, 2022, the Bank had approximately $735 million in liquidity defined as the sum of available cash, unencumbered securities and available secured borrowing capacity at the Federal Home Loan Bank of Atlanta. From December 31, 2022 to March 10, 2023, the Bank’s liquidity position increased 3.0% to approximately $760 million.
The John Marshall Bank team remains prepared to assist existing, new and SVB customers in our market area with our competitive financial products and services and our well known, outstanding customer service. We are at the ready to continue to assist businesses and individuals where needed and when appropriate.
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