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Atlantic Union Bankshares Reports Second Quarter Financial Results

Atlantic Union Bankshares Corporation (the “Company” or “Atlantic Union”) (NYSE: AUB) reported net income available to common shareholders of $22.2 million and basic and diluted earnings per common share of $0.25 for the second quarter of 2024 and adjusted operating earnings available to common shareholders(1) of $56.4 million and adjusted diluted operating earnings per common share(1) of $0.63 for the second quarter of 2024.

Merger with American National Bankshares Inc. (“American National”)

On April 1, 2024, the Company completed its acquisition of American National. American National’s results of operations are included in the Company’s consolidated results since the date of acquisition, and, therefore, the Company’s second quarter and first half of 2024 results reflect increased levels of average balances, net interest income, and expense compared to its prior quarter and first half of 2023 results. After purchase accounting fair value adjustments, the acquisition added $2.9 billion of total assets, including $2.2 billion of loans held for investment (“LHFI”), and $2.7 billion of total liabilities, including $2.6 billion in total deposits. The Company recorded preliminary goodwill of $282.3 million related to the acquisition.

In connection with the acquisition, the Company recorded an initial allowance for credit losses (“ACL”) of $18.5 million that consisted of an allowance for loan and lease losses (“ALLL”) of $17.1 million, which included a $3.9 million reserve on acquired loans that experienced a more-than insignificant amount of credit deterioration since origination (“PCD” loans), and a reserve for unfunded commitments (“RUC”) discussed below. The Company also recorded a $13.2 million reserve on purchased non-credit deteriorated loans (“non-PCD” loans) established through provision expense, which represents the CECL “double count” of the non-PCD credit mark, and a $1.4 million RUC through the provision for credit losses.

The Company incurred pre-tax merger costs of approximately $29.8 million during the second quarter of 2024 related to the American National acquisition.

“Atlantic Union delivered solid operating metrics in the second quarter, which is the first to include the financial impact of our merger with American National, which closed on April 1st,” said John C. Asbury, president and chief executive officer of Atlantic Union. “During the second quarter, we successfully completed the core systems integration over Memorial Day weekend, and now operate as one brand across our footprint. We believe the combination positions us well to deliver differentiated financial performance, increases our density and market power in central and western Virginia, and expands our franchise into contiguous markets in southern Virginia and in North Carolina.

Operating under the mantra of soundness, profitability, and growth – in that order of priority – Atlantic Union remains committed to generating sustainable, profitable growth, and building long-term value for our shareholders.”

NET INTEREST INCOME

For the second quarter of 2024, net interest income was $184.5 million, an increase of $36.7 million from $147.8 million in the first quarter of 2024. Net interest income (FTE)(1) was $188.3 million in the second quarter of 2024, an increase of $36.8 million from $151.5 million in the first quarter of 2024. The increases in both net interest income and net interest income (FTE)(1) were primarily the result of a $2.8 billion increase in average interest earning assets, partially offset by a $2.2 billion increase in average interest bearing liabilities, in each case primarily related to the acquisition of American National. For the second quarter of 2024, the Company’s net interest margin increased 28 basis points to 3.39% and the net interest margin (FTE)(1) increased 27 basis points to 3.46% compared to the prior quarter, primarily due to the impacts associated with the American National acquisition. Earning asset yields for the second quarter of 2024 increased 34 basis points to 5.96% compared to the first quarter of 2024, and the cost of funds increased by 7 basis points to 2.50%, due to changes in deposit mix as depositors continued to move to higher yielding deposit products.

The Company’s net interest margin (FTE) (1) includes the impact of acquisition accounting fair value adjustments. Net accretion income related to acquisition accounting was $14.3 million for the quarter ended June 30, 2024, compared to $602,000 for the quarter ended March 31, 2024, with the increase due to the American National acquisition. The impact of accretion and amortization for the periods presented are reflected in the following table (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loan

 

Deposit

 

Borrowings

 

 

 

 

 

Accretion

 

Amortization

 

Amortization

 

Total

For the quarter ended March 31, 2024

 

$

819

 

$

(1)

 

$

(216)

 

$

602

For the quarter ended June 30, 2024

 

 

15,660

 

 

(1,035)

 

 

(285)

 

 

14,340

ASSET QUALITY

Overview

At June 30, 2024, nonperforming assets (“NPAs”) as a percentage of total LHFI was 0.20%, a decrease of 3 basis points from the prior quarter and included nonaccrual loans of $35.9 million. This decline in the NPA ratio was primarily due to the effects of the American National acquisition, and the approximately $2.2 billion of LHFI acquired in that transaction. Accruing past due loans as a percentage of total LHFI totaled 22 basis points at June 30, 2024, a decrease of 10 basis points from March 31, 2024, and an increase of 6 basis points from June 30, 2023. Net charge-offs were 0.04% of total average LHFI (annualized) for the second quarter of 2024, a decrease of 9 basis points from March 31, 2024, and consistent with June 30, 2023. The ACL totaled $175.7 million at June 30, 2024, an increase of $23.9 million from the prior quarter and included the initial ACL related to the American National acquisition of $18.5 million, as well as the impact of loan growth and the impact of continued uncertainty in the economic outlook on certain portfolios.

Nonperforming Assets

At June 30, 2024, NPAs totaled $36.1 million, compared to $36.4 million in the prior quarter. The following table shows a summary of NPA balances at the quarters ended (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

 

2024

 

2024

 

2023

 

2023

 

2023

Nonaccrual loans

 

$

35,913

 

$

36,389

 

$

36,860

 

$

28,626

 

$

29,105

Foreclosed properties

 

 

230

 

 

29

 

 

29

 

 

149

 

 

50

Total nonperforming assets

 

$

36,143

 

$

36,418

 

$

36,889

 

$

28,775

 

$

29,155

The following table shows the activity in nonaccrual loans for the quarters ended (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

 

2024

 

2024

 

2023

 

2023

 

2023

Beginning Balance

 

$

36,389

 

 

$

36,860

 

 

$

28,626

 

 

$

29,105

 

 

$

29,082

 

Net customer payments

 

 

(6,293

)

 

 

(1,583

)

 

 

(2,198

)

 

 

(1,947

)

 

 

(5,950

)

Additions

 

 

6,831

 

 

 

5,047

 

 

 

10,604

 

 

 

1,651

 

 

 

6,685

 

Charge-offs

 

 

(759

)

 

 

(3,935

)

 

 

(172

)

 

 

(64

)

 

 

(712

)

Loans returning to accruing status

 

 

(54

)

 

 

 

 

 

 

 

 

(119

)

 

 

 

Transfers to foreclosed property

 

 

(201

)

 

 

 

 

 

 

 

 

 

 

 

 

Ending Balance

 

$

35,913

 

 

$

36,389

 

 

$

36,860

 

 

$

28,626

 

 

$

29,105

 

Past Due Loans

At June 30, 2024, past due loans still accruing interest totaled $40.2 million or 0.22% of total LHFI, compared to $50.7 million or 0.32% of total LHFI at March 31, 2024, and $24.1 million or 0.16% of total LHFI at June 30, 2023. The decrease in past due loan levels at June 30, 2024 from March 31, 2024 was primarily within the 30-59 days past due category and driven by decreases in past due relationships within the other commercial, residential 1-4 family consumer, and commercial and industrial portfolios. Of the total past due loans still accruing interest, $15.6 million or 0.09% of total LHFI were past due 90 days or more at June 30, 2024, compared to $11.4 million or 0.07% of total LHFI at March 31, 2024, and $10.1 million or 0.07% of total LHFI at June 30, 2023. The increase in loans past due 90 days or more at June 30, 2024 from both March 31, 2024 and June 30, 2023 was primarily due to one credit relationship within the other commercial portfolio.

Allowance for Credit Losses

At June 30, 2024, the ACL was $175.7 million and included an ALLL of $158.1 million and a RUC of $17.6 million. At April 1, 2024, the initial ACL related to American National was $18.5 million, consisting of an ALLL of $17.1 million, which included a $3.9 million reserve on PCD loans, and a RUC of $1.4 million. Outside of the initial ACL related to the American National acquisition, the ACL at June 30, 2024 increased $5.4 million from March 31, 2024, primarily due to loan growth in the second quarter of 2024 and the impact of continued uncertainty in the economic outlook on certain portfolios.

The ACL as a percentage of total LHFI was 0.96% at June 30, 2024 and March 31, 2024. The ALLL as a percentage of total LHFI was 0.86% at June 30, 2024 and March 31, 2024.

Net Charge-offs

Net charge-offs were $1.7 million or 0.04% of total average LHFI on an annualized basis for the second quarter of 2024, compared to $4.9 million or 0.13% (annualized) for the first quarter of 2024, and $1.6 million or 0.04% (annualized) for the second quarter of 2023.

Provision for Credit Losses

For the second quarter of 2024, the Company recorded a provision for credit losses of $21.8 million, compared to a provision for credit losses of $8.2 million in the prior quarter, and a provision for credit losses of $6.1 million in the second quarter of 2023. Included in the provision for credit losses for the second quarter of 2024 was $13.2 million initial provision expense on non-PCD loans and $1.4 million on unfunded commitments, each acquired from American National. As compared to the prior quarter, the decrease in provision for credit losses, outside of the initial provision expense recorded on non-PCD loans and unfunded commitments acquired from American National, primarily reflects the impact of lower net charge-offs in the second quarter of 2024. As compared to the same period in the prior year, the increase in provision for credit losses, outside of the initial provision expense recorded on non-PCD loans and unfunded commitments acquired from American National, primarily reflects the impact of loan growth and the impact of continued uncertainty in the economic outlook on certain portfolios.

NONINTEREST INCOME

Noninterest income decreased $1.8 million to $23.8 million for the second quarter of 2024 from $25.6 million in the prior quarter, primarily driven by $6.5 million of pre-tax losses incurred on the sale of available for sale (“AFS”) securities as part of the Company’s restructuring of the American National securities portfolio, partially offset by increases in noninterest income due to the full quarter impact of the American National acquisition that closed on April 1, 2024.

Adjusted operating noninterest income,(1) which excludes losses and gains on sale of AFS securities (losses of $6.5 million in the second quarter and gains of $3,000 in the first quarter), increased $4.8 million to $30.3 million for the second quarter from $25.5 million in the prior quarter, primarily due to the impact of the American National acquisition, which drove the majority of the $2.1 million increase in fiduciary and asset management fees, the $832,000 increase in interchange fees, the $517,000 increase in service charges on deposit accounts, the $418,000 increase in loan-related interest rate swap fees, and the $236,000 increase in other service charges, commissions, and fees. In addition to the acquisition impact, BOLI income increased $546,000 compared to the prior quarter, primarily driven by a death benefit received in the second quarter, and mortgage banking income increased $326,000.

NONINTEREST EXPENSE

Noninterest expense increased $44.7 million to $150.0 million for the second quarter of 2024 from $105.3 million in the prior quarter, primarily driven by a $27.9 million increase in pre-tax merger-related expenses, as well as other increases in noninterest expense due to the full quarter impact of the American National acquisition.

Adjusted operating noninterest expense,(1) which excludes merger-related costs ($29.8 million in the second quarter and $1.9 million in the first quarter), amortization of intangible assets ($6.0 million in the second quarter and $1.9 million in the first quarter), and a FDIC special assessment ($840,000 in the first quarter), increased $13.5 million to $114.2 million for the second quarter from $100.7 million in the prior quarter, primarily due to the impact of the American National acquisition, which drove the majority of the $6.6 million increase in salaries and benefits, the $2.1 million increase in technology and data processing, the $1.2 million increase in occupancy expenses, and the $512,000 increase in franchise and other taxes compared to the prior quarter. In addition to the acquisition impact, professional services increased $1.3 million, primarily due to fees associated with various strategic projects, and marketing and advertising expense increased $665,000 compared to the prior quarter.

INCOME TAXES

As of each reporting date, the Company considers existing evidence, both positive and negative, that could impact the future realization of deferred tax assets. The Company’s bank subsidiary, Atlantic Union Bank, is subject to a bank franchise tax but not state income tax in Virginia, its primary place of business. The Company, its subsidiaries, and Atlantic Union Bank’s non-bank subsidiaries are subject to income taxes and may be able to utilize state deferred tax assets, depending on a number of factors including those entities’ financial results. During the quarter ended June 30, 2024, the Company reviewed its business plans considering the American National acquisition and other business changes and noted shifts within its state income tax footprint and other factors that impacted projected future realization of state deferred tax items, including those attributable to operations in Virginia. As a result, the Company concluded it is more likely than not that the benefit for certain state net operating loss carryforwards will not be realized, and the Company recorded a valuation allowance of $4.8 million via a non-cash charge to income tax expense for the second quarter of 2024.

The Company’s effective tax rate for the three months ended June 30, 2024 and 2023 was 31.2% and 14.4%, respectively, and the effective tax rate for the six months ended June 30, 2024 and 2023 was 22.3% and 15.5%. respectively. The increases in the effective tax rate for both the three and six months ended June 30, 2024 were primarily due to the valuation allowance established on June 30, 2024, which resulted in a 13 and 5 percentage point increase, respectively, in the effective tax rate.

BALANCE SHEET

At June 30, 2024, the Company’s consolidated balance sheet includes the impact of the American National acquisition, which closed April 1, 2024, as discussed above. ASC 805, Business Combinations, allows for a measurement period of 12 months beyond the acquisition date to finalize the fair value measurements of the acquired Company’s net assets as additional information existing as of the acquisition date becomes available. Any future measurement period adjustments will be recorded through goodwill upon identification. Below is a summary of the related impact of the acquisition on the Company's consolidated balance sheet as of the acquisition date.

  • The fair value of assets acquired totaled $2.9 billion and included total loans of $2.2 billion with an initial loan discount of $164.6 million.
  • The fair value of the liabilities assumed totaled $2.7 billion and included total deposits of $2.6 billion with an initial deposit mark related to time deposits of $4.1 million.
  • Core deposit intangibles and other intangibles acquired totaled $84.7 million.
  • Preliminary goodwill totaled $282.3 million.

At June 30, 2024, total assets were $24.8 billion, an increase of $3.4 billion from March 31, 2024 and $4.2 billion or approximately 20.2% from June 30, 2023. The increases in total assets from the prior quarter and prior year were primarily driven by growth in LHFI (net of deferred fees and costs) and the AFS securities portfolio, primarily due to the American National acquisition.

At June 30, 2024, LHFI (net of deferred fees and costs) totaled $18.3 billion, an increase of $2.5 billion from $15.9 billion at March 31, 2024, and an increase of $3.3 billion or 21.8% from June 30, 2023. LHFI increased from the prior quarter and prior year primarily due to the American National acquisition, as well as loan growth.

At June 30, 2024, total investments were $3.5 billion, an increase of $350.1 million from March 31, 2024, and an increase of $348.2 million or 11.1% from June 30, 2023. AFS securities totaled $2.6 billion at June 30, 2024 and $2.2 billion at both March 31, 2024 and June 30, 2023. The increases compared to the prior quarter and prior year were primarily due to the acquisition of American National. Total net unrealized losses on the AFS securities portfolio were $420.7 million at June 30, 2024, compared to $410.9 million at March 31, 2024 and $450.1 million at June 30, 2023. Held to maturity securities are carried at cost and totaled $810.5 million at June 30, 2024, $828.9 million at March 31, 2024, and $849.6 million at June 30, 2023 and had net unrealized losses of $44.0 million at June 30, 2024, $37.6 million at March 31, 2024, and $41.8 million at June 30, 2023.

At June 30, 2024, total deposits were $20.0 billion, an increase of $2.7 billion from the prior quarter, and an increase of $3.6 billion or 21.9% from June 30, 2023. The increases in deposit balances from the prior quarter and prior year are primarily due to increases in interest bearing customer deposits and demand deposits, primarily related to the addition of the American National acquired deposits, as well as increases in brokered deposits.

At June 30, 2024, total borrowings were $1.2 billion, an increase of $149.0 million from March 31, 2024 and a decrease of $113.6 million or 8.6% from June 30, 2023. At June 30, 2024 average borrowings were $1.0 billion, consistent with March 31, 2024, and a decrease of $53.3 million from June 30, 2023. The increase in borrowings from the prior quarter was primarily driven by increased use of short-term borrowings to fund loan growth, as well as increases associated with the American National acquisition, while the decrease from the same period in the prior year was due to paydowns of short-term borrowings due to deposit growth.

The following table shows the Company’s capital ratios at the quarters ended:

 

 

June 30,

 

March 31,

 

June 30,

 

 

 

2024

 

2024

 

2023

 

Common equity Tier 1 capital ratio (2)

 

9.47

%

9.86

%

9.86

%

Tier 1 capital ratio (2)

 

10.27

%

10.77

%

10.81

%

Total capital ratio (2)

 

13.00

%

13.62

%

13.64

%

Leverage ratio (Tier 1 capital to average assets) (2)

 

9.05

%

9.62

%

9.64

%

Common equity to total assets

 

11.62

%

11.14

%

10.96

%

Tangible common equity to tangible assets (1)

 

6.71

%

7.05

%

6.66

%

_______________________________

(1) These are financial measures not calculated in accordance with generally accepted accounting principles (“GAAP”). For a reconciliation of these non-GAAP financial measures, see the “Alternative Performance Measures (non-GAAP)” section of the Key Financial Results.

(2) All ratios at June 30, 2024 are estimates and subject to change pending the Company’s filing of its FR Y9-C. All other periods are presented as filed.

During the second quarter of 2024, the Company declared and paid a quarterly dividend on the outstanding shares of Series A Preferred Stock of $171.88 per share (equivalent to $0.43 per outstanding depositary share), consistent with the first quarter of 2024 and the second quarter of 2023. During the second quarter of 2024, the Company also declared and paid cash dividends of $0.32 per common share, consistent with the first quarter of 2024 and a $0.02 increase or approximately 6.7% from the second quarter of 2023.

ABOUT ATLANTIC UNION BANKSHARES CORPORATION

Headquartered in Richmond, Virginia, Atlantic Union Bankshares Corporation (NYSE: AUB) is the holding company for Atlantic Union Bank. Atlantic Union Bank had 129 branches and approximately 150 ATMs located throughout Virginia and in portions of Maryland and North Carolina as of June 30, 2024. Certain non-bank financial services affiliates of Atlantic Union Bank include: Atlantic Union Equipment Finance, Inc., which provides equipment financing; Atlantic Union Financial Consultants, LLC, which provides brokerage services; and Union Insurance Group, LLC, which offers various lines of insurance products.

SECOND QUARTER 2024 EARNINGS RELEASE CONFERENCE CALL

The Company will hold a conference call and webcast for investors at 9:00 a.m. Eastern Time on Thursday, July 25, 2024, during which management will review our financial results for the second quarter 2024 and provide an update on our recent activities.

The listen-only webcast and the accompanying slides can be accessed at: https://edge.media-server.com/mmc/p/ct8s95ox.

For analysts who wish to participate in the conference call, please register at the following URL: https://register.vevent.com/register/BI670b5991ba5d495ea7c519f17cf6b388. To participate in the conference call, you must use the link to receive an audio dial-in number and an Access PIN.

A replay of the webcast, and the accompanying slides, will be available on the Company’s website for 90 days at: https://investors.atlanticunionbank.com/.

NON-GAAP FINANCIAL MEASURES

In reporting the results as of and for the period ended June 30, 2024, the Company has provided supplemental performance measures determined by methods other than in accordance with GAAP. These non-GAAP financial measures are a supplement to GAAP, which is used to prepare the Company’s financial statements, and should not be considered in isolation or as a substitute for comparable measures calculated in accordance with GAAP. In addition, the Company’s non-GAAP financial measures may not be comparable to non-GAAP financial measures of other companies. The Company uses the non-GAAP financial measures discussed herein in its analysis of the Company’s performance. The Company’s management believes that these non-GAAP financial measures provide additional understanding of ongoing operations, enhance comparability of results of operations with prior periods and show the effects of significant gains and charges in the periods presented without the impact of items or events that may obscure trends in the Company’s underlying performance. For a reconciliation of these measures to their most directly comparable GAAP measures and additional information about these non-GAAP financial measures, see “Alternative Performance Measures (non-GAAP)” in the tables within the section “Key Financial Results.”

FORWARD-LOOKING STATEMENTS

This press release and statements by our management may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include, without limitation, statements made in Mr. Asbury’s quotations, statements regarding our expectations with regard to the benefits of the American National acquisition, statements regarding our future ability to recognize the benefits of certain tax assets, our business, financial and operating results, including our deposit base and funding, the impact of future economic conditions, changes in economic conditions, our asset quality, our customer relationships, and statements that include other projections, predictions, expectations, or beliefs about future events or results or otherwise are not statements of historical fact. Such forward-looking statements are based on certain assumptions as of the time they are made, and are inherently subject to known and unknown risks, uncertainties, and other factors, some of which cannot be predicted or quantified, that may cause actual results, performance, or achievements to be materially different from those expressed or implied by such forward-looking statements. Forward-looking statements are often characterized by the use of qualified words (and their derivatives) such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” “intend,” “will,” “may,” “view,” “opportunity,” “potential,” “continue,” “confidence,” or words of similar meaning or other statements concerning opinions or judgment of the Company and our management about future events. Although we believe that our expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of our existing knowledge of our business and operations, there can be no assurance that actual future results, performance, or achievements of, or trends affecting, us will not differ materially from any projected future results, performance, achievements or trends expressed or implied by such forward-looking statements. Actual future results, performance, achievements or trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to, the effects of or changes in:

  • market interest rates and their related impacts on macroeconomic conditions, customer and client behavior, our funding costs and our loan and securities portfolios;
  • inflation and its impacts on economic growth and customer and client behavior;
  • adverse developments in the financial industry generally, such as bank failures, responsive measures to mitigate and manage such developments, related supervisory and regulatory actions and costs, and related impacts on customer and client behavior;
  • the sufficiency of liquidity and changes in our capital positions;
  • general economic and financial market conditions, in the United States generally and particularly in the markets in which we operate and which our loans are concentrated, including the effects of declines in real estate values, an increase in unemployment levels and slowdowns in economic growth;
  • the impact of purchase accounting with respect to the American National acquisition, or any change in the assumptions used regarding the assets acquired and liabilities assumed to determine the fair value and credit marks;
  • the possibility that the anticipated benefits of the American National acquisition, including anticipated cost savings and strategic gains, are not realized when expected or at all, including as a result of the impact of, or problems arising from, the recent integration of the two companies or as a result of the strength of the economy, competitive factors in the areas where we do business, or as a result of other unexpected factors or events;
  • potential adverse reactions or changes to business or employee relationships, including those resulting from the American National acquisition;
  • monetary and fiscal policies of the U.S. government, including policies of the U.S. Department of the Treasury and the Federal Reserve;
  • the quality or composition of our loan or investment portfolios and changes therein;
  • demand for loan products and financial services in our market areas;
  • our ability to manage our growth or implement our growth strategy;
  • the effectiveness of expense reduction plans;
  • the introduction of new lines of business or new products and services;
  • our ability to recruit and retain key employees;
  • real estate values in our lending area;
  • changes in accounting principles, standards, rules, and interpretations, and the related impact on our financial statements;
  • an insufficient ACL or volatility in the ACL resulting from the CECL methodology, either alone or as that may be affected by changing economic conditions, credit concentrations, inflation, changing interest rates, or other factors;
  • concentrations of loans secured by real estate, particularly commercial real estate;
  • the effectiveness of our credit processes and management of our credit risk;
  • our ability to compete in the market for financial services and increased competition from fintech companies;
  • technological risks and developments, and cyber threats, attacks, or events;
  • operational, technological, cultural, regulatory, legal, credit, and other risks associated with the exploration, consummation and integration of potential future acquisitions, whether involving stock or cash considerations;
  • the potential adverse effects of unusual and infrequently occurring events, such as weather-related disasters, terrorist acts, geopolitical conflicts or public health events (such as pandemics), and of governmental and societal responses thereto; these potential adverse effects may include, without limitation, adverse effects on the ability of our borrowers to satisfy their obligations to us, on the value of collateral securing loans, on the demand for our loans or our other products and services, on supply chains and methods used to distribute products and services, on incidents of cyberattack and fraud, on our liquidity or capital positions, on risks posed by reliance on third-party service providers, on other aspects of our business operations and on financial markets and economic growth;
  • performance by our counterparties or vendors;
  • deposit flows;
  • the availability of financing and the terms thereof;
  • the level of prepayments on loans and mortgage-backed securities;
  • the effects of legislative or regulatory changes and requirements, including changes in federal, state or local tax laws;
  • actual or potential claims, damages, and fines related to litigation or government actions, which may result in, among other things, additional costs, fines, penalties, restrictions on our business activities, reputational harm, or other adverse consequences;
  • any event or development that would cause us to conclude that there was an impairment of any asset, including intangible assets, such as goodwill; and
  • other factors, many of which are beyond our control.

Please also refer to such other factors as discussed throughout Part I, Item 1A. “Risk Factors” and Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10‑K for the year ended December 31, 2023 and related disclosures in other filings, which have been filed with the U.S. Securities and Exchange Commission (“SEC”) and are available on the SEC’s website at www.sec.gov. All risk factors and uncertainties described herein and therein should be considered in evaluating forward-looking statements, and all of the forward-looking statements are expressly qualified by the cautionary statements contained or referred to herein and therein. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on the Company or our businesses or operations. Readers are cautioned not to rely too heavily on forward-looking statements. Forward-looking statements speak only as of the date they are made. We do not intend or assume any obligation to update, revise or clarify any forward-looking statements that may be made from time to time by or on behalf of the Company, whether as a result of new information, future events or otherwise, except as required by law.

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of & For Three Months Ended

 

As of & For Six Months Ended

 

 

6/30/24

 

3/31/24

 

6/30/23

 

6/30/24

 

6/30/23

 

Results of Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income

$

320,888

 

$

262,915

 

$

230,247

 

$

583,802

 

$

447,793

 

Interest expense

 

136,354

 

 

115,090

 

 

78,163

 

 

251,444

 

 

142,265

 

Net interest income

 

184,534

 

 

147,825

 

 

152,084

 

 

332,358

 

 

305,528

 

Provision for credit losses

 

21,751

 

 

8,239

 

 

6,069

 

 

29,989

 

 

17,920

 

Net interest income after provision for credit losses

 

162,783

 

 

139,586

 

 

146,015

 

 

302,369

 

 

287,608

 

Noninterest income

 

23,812

 

 

25,552

 

 

24,197

 

 

49,365

 

 

33,824

 

Noninterest expenses

 

150,005

 

 

105,273

 

 

105,661

 

 

255,279

 

 

213,934

 

Income before income taxes

 

36,590

 

 

59,865

 

 

64,551

 

 

96,455

 

 

107,498

 

Income tax expense

 

11,429

 

 

10,096

 

 

9,310

 

 

21,525

 

 

16,604

 

Net income

 

25,161

 

 

49,769

 

 

55,241

 

 

74,930

 

 

90,894

 

Dividends on preferred stock

 

2,967

 

 

2,967

 

 

2,967

 

 

5,934

 

 

5,934

 

Net income available to common shareholders

$

22,194

 

$

46,802

 

$

52,274

 

$

68,996

 

$

84,960

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest earned on earning assets (FTE) (1)

$

324,702

 

$

266,636

 

$

233,913

 

$

591,339

 

$

455,248

 

Net interest income (FTE) (1)

 

188,348

 

 

151,546

 

 

155,750

 

 

339,895

 

 

312,983

 

Total revenue (FTE) (1)

 

212,160

 

 

177,098

 

 

179,947

 

 

389,260

 

 

346,807

 

Pre-tax pre-provision adjusted operating earnings (7)

 

94,635

 

 

70,815

 

 

74,553

 

 

165,449

 

 

147,751

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Key Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share, diluted

$

0.25

 

$

0.62

 

$

0.70

 

$

0.84

 

$

1.13

 

Return on average assets (ROA)

 

0.41

%

 

0.94

%

 

1.10

%

 

0.66

%

 

0.90

%

Return on average equity (ROE)

 

3.35

%

 

7.79

%

 

9.00

%

 

5.39

%

 

7.51

%

Return on average tangible common equity (ROTCE) (2) (3)

 

6.99

%

 

13.32

%

 

16.11

%

 

10.06

%

 

13.46

%

Efficiency ratio

 

72.00

%

 

60.72

%

 

59.94

%

 

66.88

%

 

63.04

%

Efficiency ratio (FTE) (1)

 

70.70

%

 

59.44

%

 

58.72

%

 

65.58

%

 

61.69

%

Net interest margin

 

3.39

%

 

3.11

%

 

3.37

%

 

3.26

%

 

3.39

%

Net interest margin (FTE) (1)

 

3.46

%

 

3.19

%

 

3.45

%

 

3.33

%

 

3.47

%

Yields on earning assets (FTE) (1)

 

5.96

%

 

5.62

%

 

5.19

%

 

5.80

%

 

5.05

%

Cost of interest-bearing liabilities

 

3.33

%

 

3.23

%

 

2.42

%

 

3.28

%

 

2.22

%

Cost of deposits

 

2.46

%

 

2.39

%

 

1.61

%

 

2.43

%

 

1.44

%

Cost of funds

 

2.50

%

 

2.43

%

 

1.74

%

 

2.47

%

 

1.58

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Measures (4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted operating earnings

$

59,319

 

$

51,994

 

$

58,348

 

$

111,312

 

$

108,537

 

Adjusted operating earnings available to common shareholders

 

56,352

 

 

49,027

 

 

55,381

 

 

105,378

 

 

102,603

 

Adjusted operating earnings per common share, diluted

$

0.63

 

$

0.65

 

$

0.74

 

$

1.28

 

$

1.37

 

Adjusted operating ROA

 

0.97

%

 

0.99

%

 

1.16

%

 

0.98

%

 

1.08

%

Adjusted operating ROE

 

7.90

%

 

8.14

%

 

9.51

%

 

8.01

%

 

8.96

%

Adjusted operating ROTCE (2) (3)

 

15.85

%

 

13.93

%

 

17.03

%

 

14.92

%

 

16.14

%

Adjusted operating efficiency ratio (FTE) (1)(6)

 

52.24

%

 

56.84

%

 

55.30

%

 

54.30

%

 

55.66

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Share Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share, basic

$

0.25

 

$

0.62

 

$

0.70

 

$

0.84

 

$

1.13

 

Earnings per common share, diluted

 

0.25

 

 

0.62

 

 

0.70

 

 

0.84

 

 

1.13

 

Cash dividends paid per common share

 

0.32

 

 

0.32

 

 

0.30

 

 

0.64

 

 

0.60

 

Market value per share

 

32.85

 

 

35.31

 

 

25.95

 

 

32.85

 

 

25.95

 

Book value per common share

 

32.30

 

 

31.88

 

 

30.31

 

 

32.30

 

 

30.31

 

Tangible book value per common share (2)

 

17.67

 

 

19.27

 

 

17.58

 

 

17.67

 

 

17.58

 

Price to earnings ratio, diluted

 

33.04

 

 

14.11

 

 

9.28

 

 

19.53

 

 

11.35

 

Price to book value per common share ratio

 

1.02

 

 

1.11

 

 

0.86

 

 

1.02

 

 

0.86

 

Price to tangible book value per common share ratio (2)

 

1.86

 

 

1.83

 

 

1.48

 

 

1.86

 

 

1.48

 

Weighted average common shares outstanding, basic

 

89,768,466

 

 

75,197,113

 

 

74,995,450

 

 

82,482,790

 

 

74,914,247

 

Weighted average common shares outstanding, diluted

 

89,768,466

 

 

75,197,376

 

 

74,995,557

 

 

82,482,921

 

 

74,915,977

 

Common shares outstanding at end of period

 

89,769,734

 

 

75,381,740

 

 

74,998,075

 

 

89,769,734

 

 

74,998,075

 

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of & For Three Months Ended

 

As of & For Six Months Ended

 

 

6/30/24

 

3/31/24

 

6/30/23

 

6/30/24

 

6/30/23

 

Capital Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

Common equity Tier 1 capital ratio (5)

 

9.47

%

 

9.86

%

 

9.86

%

 

9.47

%

 

9.86

%

Tier 1 capital ratio (5)

 

10.27

%

 

10.77

%

 

10.81

%

 

10.27

%

 

10.81

%

Total capital ratio (5)

 

13.00

%

 

13.62

%

 

13.64

%

 

13.00

%

 

13.64

%

Leverage ratio (Tier 1 capital to average assets) (5)

 

9.05

%

 

9.62

%

 

9.64

%

 

9.05

%

 

9.64

%

Common equity to total assets

 

11.62

%

 

11.14

%

 

10.96

%

 

11.62

%

 

10.96

%

Tangible common equity to tangible assets (2)

 

6.71

%

 

7.05

%

 

6.66

%

 

6.71

%

 

6.66

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial Condition

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

$

24,761,413

 

$

21,378,120

 

$

20,602,332

 

$

24,761,413

 

$

20,602,332

 

LHFI (net of deferred fees and costs)

 

18,347,190

 

 

15,851,628

 

 

15,066,930

 

 

18,347,190

 

 

15,066,930

 

Securities

 

3,491,481

 

 

3,141,416

 

 

3,143,236

 

 

3,491,481

 

 

3,143,236

 

Earning Assets

 

22,067,549

 

 

19,236,100

 

 

18,452,007

 

 

22,067,549

 

 

18,452,007

 

Goodwill

 

1,207,484

 

 

925,211

 

 

925,211

 

 

1,207,484

 

 

925,211

 

Amortizable intangibles, net

 

95,980

 

 

17,288

 

 

23,469

 

 

95,980

 

 

23,469

 

Deposits

 

20,000,877

 

 

17,278,435

 

 

16,411,987

 

 

20,000,877

 

 

16,411,987

 

Borrowings

 

1,206,734

 

 

1,057,724

 

 

1,320,301

 

 

1,206,734

 

 

1,320,301

 

Stockholders' equity

 

3,043,686

 

 

2,548,928

 

 

2,424,470

 

 

3,043,686

 

 

2,424,470

 

Tangible common equity (2)

 

1,573,865

 

 

1,440,072

 

 

1,309,433

 

 

1,573,865

 

 

1,309,433

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans held for investment, net of deferred fees and costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction and land development

$

1,454,545

 

$

1,246,251

 

$

1,231,720

 

$

1,454,545

 

$

1,231,720

 

Commercial real estate - owner occupied

 

2,397,700

 

 

1,981,613

 

 

1,952,189

 

 

2,397,700

 

 

1,952,189

 

Commercial real estate - non-owner occupied

 

4,906,285

 

 

4,225,018

 

 

4,113,318

 

 

4,906,285

 

 

4,113,318

 

Multifamily real estate

 

1,353,024

 

 

1,074,957

 

 

788,895

 

 

1,353,024

 

 

788,895

 

Commercial & Industrial

 

3,944,723

 

 

3,561,971

 

 

3,373,148

 

 

3,944,723

 

 

3,373,148

 

Residential 1-4 Family - Commercial

 

737,687

 

 

515,667

 

 

518,317

 

 

737,687

 

 

518,317

 

Residential 1-4 Family - Consumer

 

1,251,033

 

 

1,081,094

 

 

1,017,698

 

 

1,251,033

 

 

1,017,698

 

Residential 1-4 Family - Revolving

 

718,491

 

 

616,951

 

 

600,339

 

 

718,491

 

 

600,339

 

Auto

 

396,776

 

 

440,118

 

 

585,756

 

 

396,776

 

 

585,756

 

Consumer

 

115,541

 

 

113,414

 

 

134,709

 

 

115,541

 

 

134,709

 

Other Commercial

 

1,071,385

 

 

994,574

 

 

750,841

 

 

1,071,385

 

 

750,841

 

Total LHFI

$

18,347,190

 

$

15,851,628

 

$

15,066,930

 

$

18,347,190

 

$

15,066,930

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest checking accounts

$

5,044,503

 

$

4,753,485

 

$

4,824,192

 

$

5,044,503

 

$

4,824,192

 

Money market accounts

 

4,330,928

 

 

4,104,282

 

 

3,413,936

 

 

4,330,928

 

 

3,413,936

 

Savings accounts

 

1,056,474

 

 

895,213

 

 

986,081

 

 

1,056,474

 

 

986,081

 

Customer time deposits of $250,000 and over

 

1,015,032

 

 

721,155

 

 

578,739

 

 

1,015,032

 

 

578,739

 

Other customer time deposits

 

2,691,600

 

 

2,293,800

 

 

1,813,031

 

 

2,691,600

 

 

1,813,031

 

Time deposits

 

3,706,632

 

 

3,014,955

 

 

2,391,770

 

 

3,706,632

 

 

2,391,770

 

Total interest-bearing customer deposits

 

14,138,537

 

 

12,767,935

 

 

11,615,979

 

 

14,138,537

 

 

11,615,979

 

Brokered deposits

 

1,335,092

 

 

665,309

 

 

485,702

 

 

1,335,092

 

 

485,702

 

Total interest-bearing deposits

$

15,473,629

 

$

13,433,244

 

$

12,101,681

 

$

15,473,629

 

$

12,101,681

 

Demand deposits

 

4,527,248

 

 

3,845,191

 

 

4,310,306

 

 

4,527,248

 

 

4,310,306

 

Total deposits

$

20,000,877

 

$

17,278,435

 

$

16,411,987

 

$

20,000,877

 

$

16,411,987

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Averages

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

$

24,620,198

 

$

21,222,756

 

$

20,209,687

 

$

22,921,478

 

$

20,296,536

 

LHFI (net of deferred fees and costs)

 

18,154,673

 

 

15,732,599

 

 

14,746,218

 

 

16,943,636

 

 

14,626,579

 

Loans held for sale

 

12,392

 

 

9,142

 

 

14,413

 

 

10,767

 

 

10,168

 

Securities

 

3,476,890

 

 

3,153,556

 

 

3,176,662

 

 

3,315,223

 

 

3,321,308

 

Earning assets

 

21,925,128

 

 

19,089,393

 

 

18,091,809

 

 

20,507,261

 

 

18,164,545

 

Deposits

 

20,033,678

 

 

17,147,181

 

 

16,280,154

 

 

18,590,430

 

 

16,348,304

 

Time deposits

 

4,243,344

 

 

3,459,138

 

 

2,500,966

 

 

3,851,241

 

 

2,396,827

 

Interest-bearing deposits

 

15,437,549

 

 

13,311,837

 

 

11,903,004

 

 

14,374,693

 

 

11,813,929

 

Borrowings

 

1,043,297

 

 

1,012,797

 

 

1,071,171

 

 

1,028,047

 

 

1,096,567

 

Interest-bearing liabilities

 

16,480,846

 

 

14,324,634

 

 

12,974,175

 

 

15,402,740

 

 

12,910,496

 

Stockholders' equity

 

3,021,929

 

 

2,568,243

 

 

2,460,741

 

 

2,795,086

 

 

2,442,273

 

Tangible common equity (2)

 

1,549,876

 

 

1,458,478

 

 

1,345,426

 

 

1,504,178

 

 

1,326,043

 

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of & For Three Months Ended

 

As of & For Six Months Ended

 

 

6/30/24

 

3/31/24

 

6/30/23

 

6/30/24

 

6/30/23

 

Asset Quality

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Credit Losses (ACL)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance, Allowance for loan and lease losses (ALLL)

$

136,190

 

$

132,182

 

$

116,512

 

$

132,182

 

$

110,768

 

Add: Recoveries

 

1,348

 

 

977

 

 

1,035

 

 

2,325

 

 

2,202

 

Less: Charge-offs

 

3,088

 

 

5,894

 

 

2,602

 

 

8,982

 

 

8,328

 

Add: Initial Allowance - PCD American National loans

 

3,896

 

 

 

 

 

 

3,896

 

 

 

Add: Initial Provision - Non-PCD American National loans

 

13,229

 

 

 

 

 

 

13,229

 

 

 

Add: Provision for loan losses

 

6,556

 

 

8,925

 

 

5,738

 

 

15,481

 

 

16,041

 

Ending balance, ALLL

$

158,131

 

$

136,190

 

$

120,683

 

$

158,131

 

$

120,683

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance, Reserve for unfunded commitment (RUC)

$

15,582

 

$

16,269

 

$

15,199

 

$

16,269

 

$

13,675

 

Add: Initial Provision - RUC American National loans

 

1,353

 

 

 

 

 

 

1,353

 

 

 

Add: Provision for unfunded commitments

 

622

 

 

(687)

 

 

349

 

 

(65)

 

 

1,873

 

Ending balance, RUC

$

17,557

 

$

15,582

 

$

15,548

 

$

17,557

 

$

15,548

 

Total ACL

$

175,688

 

$

151,772

 

$

136,231

 

$

175,688

 

$

136,231

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ACL / total LHFI

 

0.96

%

 

0.96

%

 

0.90

%

 

0.96

%

 

0.90

%

ALLL / total LHFI

 

0.86

%

 

0.86

%

 

0.80

%

 

0.86

%

 

0.80

%

Net charge-offs / total average LHFI (annualized)

 

0.04

%

 

0.13

%

 

0.04

%

 

0.08

%

 

0.08

%

Provision for loan losses/ total average LHFI (annualized)

 

0.44

%

 

0.23

%

 

0.16

%

 

0.34

%

 

0.22

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonperforming Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction and land development

$

1,144

 

$

342

 

$

284

 

$

1,144

 

$

284

 

Commercial real estate - owner occupied

 

4,651

 

 

2,888

 

 

3,978

 

 

4,651

 

 

3,978

 

Commercial real estate - non-owner occupied

 

10,741

 

 

10,335

 

 

6,473

 

 

10,741

 

 

6,473

 

Multifamily real estate

 

1

 

 

 

 

 

 

1

 

 

 

Commercial & Industrial

 

3,408

 

 

6,480

 

 

2,738

 

 

3,408

 

 

2,738

 

Residential 1-4 Family - Commercial

 

1,783

 

 

1,790

 

 

1,844

 

 

1,783

 

 

1,844

 

Residential 1-4 Family - Consumer

 

10,799

 

 

10,990

 

 

10,033

 

 

10,799

 

 

10,033

 

Residential 1-4 Family - Revolving

 

3,028

 

 

3,135

 

 

3,461

 

 

3,028

 

 

3,461

 

Auto

 

354

 

 

429

 

 

291

 

 

354

 

 

291

 

Consumer

 

4

 

 

 

 

3

 

 

4

 

 

3

 

Nonaccrual loans

$

35,913

 

$

36,389

 

$

29,105

 

$

35,913

 

$

29,105

 

Foreclosed property

 

230

 

 

29

 

 

50

 

 

230

 

 

50

 

Total nonperforming assets (NPAs)

$

36,143

 

$

36,418

 

$

29,155

 

$

36,143

 

$

29,155

 

Construction and land development

$

764

 

$

171

 

$

24

 

$

764

 

$

24

 

Commercial real estate - owner occupied

 

1,047

 

 

3,634

 

 

2,463

 

 

1,047

 

 

2,463

 

Commercial real estate - non-owner occupied

 

1,309

 

 

1,197

 

 

2,763

 

 

1,309

 

 

2,763

 

Multifamily real estate

 

141

 

 

144

 

 

 

 

141

 

 

 

Commercial & Industrial

 

684

 

 

1,860

 

 

810

 

 

684

 

 

810

 

Residential 1-4 Family - Commercial

 

678

 

 

1,030

 

 

693

 

 

678

 

 

693

 

Residential 1-4 Family - Consumer

 

1,645

 

 

1,641

 

 

1,716

 

 

1,645

 

 

1,716

 

Residential 1-4 Family - Revolving

 

1,449

 

 

1,343

 

 

1,259

 

 

1,449

 

 

1,259

 

Auto

 

263

 

 

284

 

 

243

 

 

263

 

 

243

 

Consumer

 

176

 

 

141

 

 

74

 

 

176

 

 

74

 

Other Commercial

 

7,464

 

 

 

 

66

 

 

7,464

 

 

66

 

LHFI ≥ 90 days and still accruing

$

15,620

 

$

11,445

 

$

10,111

 

$

15,620

 

$

10,111

 

Total NPAs and LHFI ≥ 90 days

$

51,763

 

$

47,863

 

$

39,266

 

$

51,763

 

$

39,266

 

NPAs / total LHFI

 

0.20

%

 

0.23

%

 

0.19

%

 

0.20

%

 

0.19

%

NPAs / total assets

 

0.15

%

 

0.17

%

 

0.14

%

 

0.15

%

 

0.14

%

ALLL / nonaccrual loans

 

440.32

%

 

374.26

%

 

414.65

%

 

440.32

%

 

414.65

%

ALLL/ nonperforming assets

 

437.51

%

 

373.96

%

 

413.94

%

 

437.51

%

 

413.94

%

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of & For Three Months Ended

 

As of & For Six Months Ended

 

 

6/30/24

 

3/31/24

 

6/30/23

 

6/30/24

 

6/30/23

 

Past Due Detail

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction and land development

$

1,689

 

$

2,163

 

$

295

 

$

1,689

 

$

295

 

Commercial real estate - owner occupied

 

3,450

 

 

3,663

 

 

602

 

 

3,450

 

 

602

 

Commercial real estate - non-owner occupied

 

1,316

 

 

2,271

 

 

 

 

1,316

 

 

 

Multifamily real estate

 

1,694

 

 

 

 

 

 

1,694

 

 

 

Commercial & Industrial

 

2,154

 

 

5,540

 

 

254

 

 

2,154

 

 

254

 

Residential 1-4 Family - Commercial

 

873

 

 

1,407

 

 

1,076

 

 

873

 

 

1,076

 

Residential 1-4 Family - Consumer

 

1,331

 

 

6,070

 

 

1,504

 

 

1,331

 

 

1,504

 

Residential 1-4 Family - Revolving

 

2,518

 

 

1,920

 

 

1,729

 

 

2,518

 

 

1,729

 

Auto

 

3,463

 

 

3,192

 

 

2,877

 

 

3,463

 

 

2,877

 

Consumer

 

385

 

 

418

 

 

334

 

 

385

 

 

334

 

Other Commercial

 

289

 

 

8,187

 

 

23

 

 

289

 

 

23

 

LHFI 30-59 days past due

$

19,162

 

$

34,831

 

$

8,694

 

$

19,162

 

$

8,694

 

Construction and land development

$

155

 

$

1,097

 

$

 

 

155

 

 

 

Commercial real estate - owner occupied

 

72

 

 

 

 

10

 

 

72

 

 

10

 

Commercial real estate - non-owner occupied

 

 

 

558

 

 

 

 

 

 

 

Multifamily real estate

 

632

 

 

 

 

 

 

632

 

 

 

Commercial & Industrial

 

192

 

 

348

 

 

400

 

 

192

 

 

400

 

Residential 1-4 Family - Commercial

 

689

 

 

98

 

 

189

 

 

689

 

 

189

 

Residential 1-4 Family - Consumer

 

1,960

 

 

204

 

 

2,813

 

 

1,960

 

 

2,813

 

Residential 1-4 Family - Revolving

 

795

 

 

1,477

 

 

1,114

 

 

795

 

 

1,114

 

Auto

 

565

 

 

330

 

 

564

 

 

565

 

 

564

 

Consumer

 

309

 

 

197

 

 

214

 

 

309

 

 

214

 

Other Commercial

 

 

 

102

 

 

 

 

 

 

 

LHFI 60-89 days past due

$

5,369

 

$

4,411

 

$

5,304

 

$

5,369

 

$

5,304

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Past Due and still accruing

$

40,151

 

$

50,687

 

$

24,109

 

$

40,151

 

$

24,109

 

Past Due and still accruing / total LHFI

 

0.22

%

 

0.32

%

 

0.16

%

 

0.22

%

 

0.16

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alternative Performance Measures (non-GAAP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income (FTE) (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income (GAAP)

$

184,534

 

$

147,825

 

$

152,084

 

$

332,358

 

$

305,528

 

FTE adjustment

 

3,814

 

 

3,721

 

 

3,666

 

 

7,537

 

 

7,455

 

Net interest income (FTE) (non-GAAP)

$

188,348

 

$

151,546

 

$

155,750

 

$

339,895

 

$

312,983

 

Noninterest income (GAAP)

 

23,812

 

 

25,552

 

 

24,197

 

 

49,365

 

 

33,824

 

Total revenue (FTE) (non-GAAP)

$

212,160

 

$

177,098

 

$

179,947

 

$

389,260

 

$

346,807

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average earning assets

$

21,925,128

 

$

19,089,393

 

$

18,091,809

 

$

20,507,261

 

$

18,164,545

 

Net interest margin

 

3.39

%

 

3.11

%

 

3.37

%

 

3.26

%

 

3.39

%

Net interest margin (FTE)

 

3.46

%

 

3.19

%

 

3.45

%

 

3.33

%

 

3.47

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible Assets (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending assets (GAAP)

$

24,761,413

 

$

21,378,120

 

$

20,602,332

 

$

24,761,413

 

$

20,602,332

 

Less: Ending goodwill

 

1,207,484

 

 

925,211

 

 

925,211

 

 

1,207,484

 

 

925,211

 

Less: Ending amortizable intangibles

 

95,980

 

 

17,288

 

 

23,469

 

 

95,980

 

 

23,469

 

Ending tangible assets (non-GAAP)

$

23,457,949

 

$

20,435,621

 

$

19,653,652

 

$

23,457,949

 

$

19,653,652

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible Common Equity (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending equity (GAAP)

$

3,043,686

 

$

2,548,928

 

$

2,424,470

 

$

3,043,686

 

$

2,424,470

 

Less: Ending goodwill

 

1,207,484

 

 

925,211

 

 

925,211

 

 

1,207,484

 

 

925,211

 

Less: Ending amortizable intangibles

 

95,980

 

 

17,288

 

 

23,469

 

 

95,980

 

 

23,469

 

Less: Perpetual preferred stock

 

166,357

 

 

166,357

 

 

166,357

 

 

166,357

 

 

166,357

 

Ending tangible common equity (non-GAAP)

$

1,573,865

 

$

1,440,072

 

$

1,309,433

 

$

1,573,865

 

$

1,309,433

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average equity (GAAP)

$

3,021,929

 

$

2,568,243

 

$

2,460,741

 

$

2,795,086

 

$

2,442,273

 

Less: Average goodwill

 

1,208,588

 

 

925,211

 

 

925,211

 

 

1,066,899

 

 

925,211

 

Less: Average amortizable intangibles

 

97,109

 

 

18,198

 

 

23,748

 

 

57,653

 

 

24,663

 

Less: Average perpetual preferred stock

 

166,356

 

 

166,356

 

 

166,356

 

 

166,356

 

 

166,356

 

Average tangible common equity (non-GAAP)

$

1,549,876

 

$

1,458,478

 

$

1,345,426

 

$

1,504,178

 

$

1,326,043

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ROTCE (2)(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income available to common shareholders (GAAP)

$

22,194

 

$

46,802

 

$

52,274

 

$

68,996

 

$

84,960

 

Plus: Amortization of intangibles, tax effected

 

4,736

 

 

1,497

 

 

1,751

 

 

6,232

 

 

3,550

 

Net income available to common shareholders before amortization of intangibles (non-GAAP)

$

26,930

 

$

48,299

 

$

54,025

 

$

75,228

 

$

88,510

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average tangible common equity (ROTCE)

 

6.99

%

 

13.32

%

 

16.11

%

 

10.06

%

 

13.46

%

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of & For Three Months Ended

 

As of & For Six Months Ended

 

 

6/30/24

 

3/31/24

 

6/30/23

 

6/30/24

 

6/30/23

 

Operating Measures (4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (GAAP)

$

25,161

 

$

49,769

 

$

55,241

 

$

74,930

 

$

90,894

 

Plus: Merger-related costs, net of tax

 

24,236

 

 

1,563

 

 

 

 

25,799

 

 

 

Plus: Strategic cost saving initiatives, net of tax

 

 

 

 

 

3,109

 

 

 

 

3,109

 

Plus: FDIC special assessment, net of tax

 

 

 

664

 

 

 

 

664

 

 

 

Plus: Legal reserve, net of tax

 

 

 

 

 

 

 

 

 

3,950

 

Plus: Deferred tax asset write-down

 

4,774

 

 

 

 

 

 

4,774

 

 

 

Less: (Loss) gain on sale of securities, net of tax

 

(5,148)

 

 

2

 

 

2

 

 

(5,145)

 

 

(10,584)

 

Adjusted operating earnings (non-GAAP)

 

59,319

 

 

51,994

 

 

58,348

 

 

111,312

 

 

108,537

 

Less: Dividends on preferred stock

 

2,967

 

 

2,967

 

 

2,967

 

 

5,934

 

 

5,934

 

Adjusted operating earnings available to common shareholders (non-GAAP)

$

56,352

 

$

49,027

 

$

55,381

 

$

105,378

 

$

102,603

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Efficiency Ratio (1)(6)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense (GAAP)

$

150,005

 

$

105,273

 

$

105,661

 

$

255,279

 

$

213,934

 

Less: Amortization of intangible assets

 

5,995

 

 

1,895

 

 

2,216

 

 

7,889

 

 

4,494

 

Less: Merger-related costs

 

29,778

 

 

1,874

 

 

 

 

31,652

 

 

 

Less: FDIC special assessment

 

 

 

840

 

 

 

 

840

 

 

 

Less: Strategic cost saving initiatives

 

 

 

 

 

3,935

 

 

 

 

3,935

 

Less: Legal reserve

 

 

 

 

 

 

 

 

 

5,000

 

Adjusted operating noninterest expense (non-GAAP)

$

114,232

 

$

100,664

 

$

99,510

 

$

214,898

 

$

200,505

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income (GAAP)

$

23,812

 

$

25,552

 

$

24,197

 

$

49,365

 

$

33,824

 

Less: (Loss) gain on sale of securities

 

(6,516)

 

 

3

 

 

2

 

 

(6,513)

 

 

(13,398)

 

Adjusted operating noninterest income (non-GAAP)

$

30,328

 

$

25,549

 

$

24,195

 

$

55,878

 

$

47,222

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income (FTE) (non-GAAP) (1)

$

188,348

 

$

151,546

 

$

155,750

 

$

339,895

 

$

312,983

 

Adjusted operating noninterest income (non-GAAP)

 

30,328

 

 

25,549

 

 

24,195

 

 

55,878

 

 

47,222

 

Total adjusted revenue (FTE) (non-GAAP) (1)

$

218,676

 

$

177,095

 

$

179,945

 

$

395,773

 

$

360,205

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency ratio

 

72.00

%

 

60.72

%

 

59.94

%

 

66.88

%

 

63.04

%

Efficiency ratio (FTE) (1)

 

70.70

%

 

59.44

%

 

58.72

%

 

65.58

%

 

61.69

%

Adjusted operating efficiency ratio (FTE) (1)(6)

 

52.24

%

 

56.84

%

 

55.30

%

 

54.30

%

 

55.66

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating ROA & ROE (4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted operating earnings (non-GAAP)

$

59,319

 

$

51,994

 

$

58,348

 

$

111,312

 

$

108,537

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average assets (GAAP)

$

24,620,198

 

$

21,222,756

 

$

20,209,687

 

$

22,921,478

 

$

20,296,536

 

Return on average assets (ROA) (GAAP)

 

0.41

%

 

0.94

%

 

1.10

%

 

0.66

%

 

0.90

%

Adjusted operating return on average assets (ROA) (non-GAAP)

 

0.97

%

 

0.99

%

 

1.16

%

 

0.98

%

 

1.08

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average equity (GAAP)

$

3,021,929

 

$

2,568,243

 

$

2,460,741

 

$

2,795,086

 

$

2,442,273

 

Return on average equity (ROE) (GAAP)

 

3.35

%

 

7.79

%

 

9.00

%

 

5.39

%

 

7.51

%

Adjusted operating return on average equity (ROE) (non-GAAP)

 

7.90

%

 

8.14

%

 

9.51

%

 

8.01

%

 

8.96

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating ROTCE (2)(3)(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted operating earnings available to common shareholders (non-GAAP)

$

56,352

 

$

49,027

 

$

55,381

 

$

105,378

 

$

102,603

 

Plus: Amortization of intangibles, tax effected

 

4,736

 

 

1,497

 

 

1,751

 

 

6,232

 

 

3,550

 

Adjusted operating earnings available to common shareholders before amortization of intangibles (non-GAAP)

$

61,088

 

$

50,524

 

$

57,132

 

$

111,610

 

$

106,153

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average tangible common equity (non-GAAP)

$

1,549,876

 

$

1,458,478

 

$

1,345,426

 

$

1,504,178

 

$

1,326,043

 

Adjusted operating return on average tangible common equity (non-GAAP)

 

15.85

%

 

13.93

%

 

17.03

%

 

14.92

%

 

16.14

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-tax pre-provision adjusted operating earnings (7)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (GAAP)

$

25,161

 

$

49,769

 

$

55,241

 

$

74,930

 

$

90,894

 

Plus: Provision for credit losses

 

21,751

 

 

8,239

 

 

6,069

 

 

29,989

 

 

17,920

 

Plus: Income tax expense

 

11,429

 

 

10,096

 

 

9,310

 

 

21,525

 

 

16,604

 

Plus: Merger-related costs

 

29,778

 

 

1,874

 

 

 

 

31,652

 

 

 

Plus: Strategic cost saving initiatives

 

 

 

 

 

3,935

 

 

 

 

3,935

 

Plus: FDIC special assessment

 

 

 

840

 

 

 

 

840

 

 

 

Plus: Legal reserve

 

 

 

 

 

 

 

 

 

5,000

 

Less: (Loss) gain on sale of securities, net of tax

 

(6,516)

 

 

3

 

 

2

 

 

(6,513)

 

 

(13,398)

 

Pre-tax pre-provision adjusted operating earnings (non-GAAP)

$

94,635

 

$

70,815

 

$

74,553

 

$

165,449

 

$

147,751

 

Less: Dividends on preferred stock

 

2,967

 

 

2,967

 

 

2,967

 

 

5,934

 

 

5,934

 

Pre-tax pre-provision adjusted operating earnings available to common shareholders (non-GAAP)

$

91,668

 

$

67,848

 

$

71,586

 

$

159,515

 

$

141,817

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding, diluted

 

89,768,466

 

 

75,197,376

 

 

74,995,557

 

 

82,482,921

 

 

74,915,977

 

Pre-tax pre-provision earnings per common share, diluted

$

1.02

 

$

0.90

 

$

0.95

 

$

1.93

 

$

1.89

 

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of & For Three Months Ended

 

As of & For Six Months Ended

 

 

6/30/24

 

3/31/24

 

6/30/23

 

6/30/24

 

6/30/23

 

Mortgage Origination Held for Sale Volume

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Refinance Volume

$

4,234

 

$

5,638

 

$

4,076

 

$

9,872

 

$

7,528

 

Purchase Volume

 

48,487

 

 

31,768

 

 

32,168

 

 

80,255

 

 

64,361

 

Total Mortgage loan originations held for sale

$

52,721

 

$

37,406

 

$

36,244

 

$

90,127

 

$

71,889

 

% of originations held for sale that are refinances

 

8.0

%

 

15.1

%

 

11.2

%

 

11.0

%

 

10.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wealth

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets under management

$

6,487,087

 

$

5,258,880

 

$

4,774,501

 

$

6,487,087

 

$

4,774,501

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

End of period full-time employees

 

2,083

 

 

1,745

 

 

1,878

 

 

2,083

 

 

1,878

 

Number of full-service branches

 

129

 

 

109

 

 

109

 

 

129

 

 

109

 

Number of automatic transaction machines (ATMs)

 

149

 

 

123

 

 

123

 

 

149

 

 

123

 

____________________________

(1)

These are non-GAAP financial measures. The Company believes net interest income (FTE), total revenue (FTE), and total adjusted revenue (FTE), which are used in computing net interest margin (FTE), efficiency ratio (FTE) and adjusted operating efficiency ratio (FTE), provide valuable additional insight into the net interest margin and the efficiency ratio by adjusting for differences in tax treatment of interest income sources. The entire FTE adjustment is attributable to interest income on earning assets, which is used in computing the yield on earning assets. Interest expense and the related cost of interest-bearing liabilities and cost of funds ratios are not affected by the FTE components.

(2)

These are non-GAAP financial measures. Tangible assets and tangible common equity are used in the calculation of certain profitability, capital, and per share ratios. The Company believes tangible assets, tangible common equity and the related ratios are meaningful measures of capital adequacy because they provide a meaningful base for period-to-period and company-to-company comparisons, which the Company believes will assist investors in assessing the capital of the Company and its ability to absorb potential losses. The Company believes tangible common equity is an important indication of its ability to grow organically and through business combinations as well as its ability to pay dividends and to engage in various capital management strategies.

(3)

These are non-GAAP financial measures. The Company believes that ROTCE is a meaningful supplement to GAAP financial measures and is useful to investors because it measures the performance of a business consistently across time without regard to whether components of the business were acquired or developed internally.

(4)

These are non-GAAP financial measures. Adjusted operating measures exclude, as applicable, merger-related costs, strategic cost saving initiatives (principally composed of severance charges related to headcount reductions and charges for exiting leases), FDIC special assessments, legal reserves associated with our previously disclosed settlement with the CFPB, deferred tax asset write-down, and (loss) gain on sale of securities. The Company believes these non-GAAP adjusted measures provide investors with important information about the continuing economic results of the Company’s operations.

(5)

All ratios at June 30, 2024 are estimates and subject to change pending the Company’s filing of its FR Y9‑C. All other periods are presented as filed.

(6)

The adjusted operating efficiency ratio (FTE) excludes, as applicable, the amortization of intangible assets, merger-related costs, FDIC special assessments, strategic cost saving initiatives (principally composed of severance charges related to headcount reductions and charges for exiting leases), legal reserves associated with our previously disclosed settlement with the CFPB, and (loss) gain on sale of securities. This measure is similar to the measure used by the Company when analyzing corporate performance and is also similar to the measure used for incentive compensation. The Company believes this adjusted measure provides investors with important information about the continuing economic results of the Company’s operations.

(7)

These are non-GAAP financial measures. Pre-tax pre-provision adjusted earnings excludes, as applicable, the provision for credit losses, which can fluctuate significantly from period-to-period under the CECL methodology, income tax expense, merger-related costs, strategic cost saving initiatives (principally composed of severance charges related to headcount reductions and charges for exiting leases), FDIC special assessments, legal reserves associated with our previously disclosed settlement with the CFPB, and (loss) gain on sale of securities. The Company believes this adjusted measure provides investors with important information about the continuing economic results of the Company’s operations.

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

June 30,

 

December 31,

 

June 30,

 

2024

 

2023

 

2023

ASSETS

(unaudited)

 

(audited)

 

(unaudited)

Cash and cash equivalents:

 

 

 

 

 

 

 

 

Cash and due from banks

$

233,065

 

$

196,754

 

$

199,778

Interest-bearing deposits in other banks

 

207,129

 

 

167,601

 

 

227,015

Federal funds sold

 

5,820

 

 

13,776

 

 

1,474

Total cash and cash equivalents

 

446,014

 

 

378,131

 

 

428,267

Securities available for sale, at fair value

 

2,555,723

 

 

2,231,261

 

 

2,182,448

Securities held to maturity, at carrying value

 

810,450

 

 

837,378

 

 

849,610

Restricted stock, at cost

 

125,308

 

 

115,472

 

 

111,178

Loans held for sale

 

12,906

 

 

6,710

 

 

10,327

Loans held for investment, net of deferred fees and costs

 

18,347,190

 

 

15,635,043

 

 

15,066,930

Less: allowance for loan and lease losses

 

158,131

 

 

132,182

 

 

120,683

Total loans held for investment, net

 

18,189,059

 

 

15,502,861

 

 

14,946,247

Premises and equipment, net

 

114,987

 

 

90,959

 

 

114,786

Goodwill

 

1,207,484

 

 

925,211

 

 

925,211

Amortizable intangibles, net

 

95,980

 

 

19,183

 

 

23,469

Bank owned life insurance

 

489,550

 

 

452,565

 

 

446,441

Other assets

 

713,952

 

 

606,466

 

 

564,348

Total assets

$

24,761,413

 

$

21,166,197

 

$

20,602,332

LIABILITIES

 

 

 

 

 

 

 

 

Noninterest-bearing demand deposits

$

4,527,248

 

$

3,963,181

 

$

4,310,306

Interest-bearing deposits

 

15,473,629

 

 

12,854,948

 

 

12,101,681

Total deposits

 

20,000,877

 

 

16,818,129

 

 

16,411,987

Securities sold under agreements to repurchase

 

64,585

 

 

110,833

 

 

130,461

Other short-term borrowings

 

725,500

 

 

810,000

 

 

799,400

Long-term borrowings

 

416,649

 

 

391,025

 

 

390,440

Other liabilities

 

510,116

 

 

479,883

 

 

445,574

Total liabilities

 

21,717,727

 

 

18,609,870

 

 

18,177,862

Commitments and contingencies

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

Preferred stock, $10.00 par value

 

173

 

 

173

 

 

173

Common stock, $1.33 par value

 

118,475

 

 

99,147

 

 

99,088

Additional paid-in capital

 

2,273,312

 

 

1,782,286

 

 

1,776,494

Retained earnings

 

1,034,313

 

 

1,018,070

 

 

959,582

Accumulated other comprehensive loss

 

(382,587)

 

 

(343,349)

 

 

(410,867)

Total stockholders' equity

 

3,043,686

 

 

2,556,327

 

 

2,424,470

Total liabilities and stockholders' equity

$

24,761,413

 

$

21,166,197

 

$

20,602,332

 

 

 

 

 

 

 

 

 

Common shares outstanding

 

89,769,734

 

 

75,023,327

 

 

74,998,075

Common shares authorized

 

200,000,000

 

 

200,000,000

 

 

200,000,000

Preferred shares outstanding

 

17,250

 

 

17,250

 

 

17,250

Preferred shares authorized

 

500,000

 

 

500,000

 

 

500,000

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(Dollars in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

March 31,

 

June 30,

 

June 30,

 

June 30,

 

2024

 

2024

 

2023

 

2024

 

2023

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

$

285,198

 

$

234,600

 

$

205,172

 

$

519,796

 

$

395,165

Interest on deposits in other banks

 

2,637

 

 

1,280

 

 

1,014

 

 

3,918

 

 

2,507

Interest and dividends on securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

24,886

 

 

18,879

 

 

15,565

 

 

43,765

 

 

32,317

Nontaxable

 

8,167

 

 

8,156

 

 

8,496

 

 

16,323

 

 

17,804

Total interest and dividend income

 

320,888

 

 

262,915

 

 

230,247

 

 

583,802

 

 

447,793

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

122,504

 

 

101,864

 

 

65,267

 

 

224,368

 

 

117,100

Interest on short-term borrowings

 

8,190

 

 

8,161

 

 

8,044

 

 

16,351

 

 

15,607

Interest on long-term borrowings

 

5,660

 

 

5,065

 

 

4,852

 

 

10,725

 

 

9,558

Total interest expense

 

136,354

 

 

115,090

 

 

78,163

 

 

251,444

 

 

142,265

Net interest income

 

184,534

 

 

147,825

 

 

152,084

 

 

332,358

 

 

305,528

Provision for credit losses

 

21,751

 

 

8,239

 

 

6,069

 

 

29,989

 

 

17,920

Net interest income after provision for credit losses

 

162,783

 

 

139,586

 

 

146,015

 

 

302,369

 

 

287,608

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges on deposit accounts

 

9,086

 

 

8,569

 

 

8,118

 

 

17,655

 

 

16,020

Other service charges, commissions and fees

 

1,967

 

 

1,731

 

 

1,693

 

 

3,698

 

 

3,439

Interchange fees

 

3,126

 

 

2,294

 

 

2,459

 

 

5,420

 

 

4,784

Fiduciary and asset management fees

 

6,907

 

 

4,838

 

 

4,359

 

 

11,745

 

 

8,620

Mortgage banking income

 

1,193

 

 

867

 

 

449

 

 

2,060

 

 

1,303

(Loss) gain on sale of securities

 

(6,516)

 

 

3

 

 

2

 

 

(6,513)

 

 

(13,398)

Bank owned life insurance income

 

3,791

 

 

3,245

 

 

2,870

 

 

7,037

 

 

5,698

Loan-related interest rate swap fees

 

1,634

 

 

1,216

 

 

2,316

 

 

2,850

 

 

3,755

Other operating income

 

2,624

 

 

2,789

 

 

1,931

 

 

5,413

 

 

3,603

Total noninterest income

 

23,812

 

 

25,552

 

 

24,197

 

 

49,365

 

 

33,824

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and benefits

 

68,531

 

 

61,882

 

 

62,019

 

 

130,413

 

 

122,547

Occupancy expenses

 

7,836

 

 

6,625

 

 

6,094

 

 

14,462

 

 

12,450

Furniture and equipment expenses

 

3,805

 

 

3,309

 

 

3,565

 

 

7,114

 

 

7,317

Technology and data processing

 

10,274

 

 

8,127

 

 

8,566

 

 

18,401

 

 

16,708

Professional services

 

4,377

 

 

3,081

 

 

4,433

 

 

7,458

 

 

7,847

Marketing and advertising expense

 

2,983

 

 

2,318

 

 

2,817

 

 

5,301

 

 

5,168

FDIC assessment premiums and other insurance

 

4,675

 

 

5,143

 

 

4,074

 

 

9,818

 

 

7,973

Franchise and other taxes

 

5,013

 

 

4,501

 

 

4,499

 

 

9,514

 

 

8,997

Loan-related expenses

 

1,275

 

 

1,323

 

 

1,619

 

 

2,598

 

 

3,171

Amortization of intangible assets

 

5,995

 

 

1,895

 

 

2,216

 

 

7,889

 

 

4,494

Merger-related costs

 

29,778

 

 

1,874

 

 

 

 

31,652

 

 

Other expenses

 

5,463

 

 

5,195

 

 

5,759

 

 

10,659

 

 

17,262

Total noninterest expenses

 

150,005

 

 

105,273

 

 

105,661

 

 

255,279

 

 

213,934

Income before income taxes

 

36,590

 

 

59,865

 

 

64,551

 

 

96,455

 

 

107,498

Income tax expense

 

11,429

 

 

10,096

 

 

9,310

 

 

21,525

 

 

16,604

Net Income

$

25,161

 

$

49,769

 

$

55,241

 

$

74,930

 

$

90,894

Dividends on preferred stock

 

2,967

 

 

2,967

 

 

2,967

 

 

5,934

 

 

5,934

Net income available to common shareholders

$

22,194

 

$

46,802

 

$

52,274

 

$

68,996

 

$

84,960

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

$

0.25

 

$

0.62

 

$

0.70

 

$

0.84

 

$

1.13

Diluted earnings per common share

$

0.25

 

$

0.62

 

$

0.70

 

$

0.84

 

$

1.13

AVERAGE BALANCES, INCOME AND EXPENSES, YIELDS AND RATES (TAXABLE EQUIVALENT BASIS) (UNAUDITED)

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Quarter Ended

 

June 30, 2024

 

March 31, 2024

Average

Balance

 

Interest

Income /

Expense (1)

 

Yield /

Rate (1)(2)

 

Average

Balance

 

Interest

Income /

Expense (1)

 

Yield /

Rate (1)(2)

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

$

2,221,486

 

$

24,886

 

4.51%

 

$

1,895,820

 

$

18,879

 

4.01%

Tax-exempt

 

1,255,404

 

 

10,338

 

3.31%

 

 

1,257,736

 

 

10,324

 

3.30%

Total securities

 

3,476,890

 

 

35,224

 

4.07%

 

 

3,153,556

 

 

29,203

 

3.72%

LHFI, net of deferred fees and costs (3)(4)

 

18,154,673

 

 

286,391

 

6.34%

 

 

15,732,599

 

 

235,832

 

6.03%

Other earning assets

 

293,565

 

 

3,087

 

4.23%

 

 

203,238

 

 

1,601

 

3.17%

Total earning assets

 

21,925,128

 

$

324,702

 

5.96%

 

 

19,089,393

 

$

266,636

 

5.62%

Allowance for loan and lease losses

 

(157,204)

 

 

 

 

 

 

 

(133,090)

 

 

 

 

 

Total non-earning assets

 

2,852,274

 

 

 

 

 

 

 

2,266,453

 

 

 

 

 

Total assets

$

24,620,198

 

 

 

 

 

 

$

21,222,756

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transaction and money market accounts

$

10,117,794

 

$

74,833

 

2.97%

 

$

8,952,119

 

$

65,254

 

2.93%

Regular savings

 

1,076,411

 

 

555

 

0.21%

 

 

900,580

 

 

501

 

0.22%

Time deposits (5)

 

4,243,344

 

 

47,116

 

4.47%

 

 

3,459,138

 

 

36,109

 

4.20%

Total interest-bearing deposits

 

15,437,549

 

 

122,504

 

3.19%

 

 

13,311,837

 

 

101,864

 

3.08%

Other borrowings (6)

 

1,043,297

 

 

13,850

 

5.34%

 

 

1,012,797

 

 

13,226

 

5.25%

Total interest-bearing liabilities

$

16,480,846

 

$

136,354

 

3.33%

 

$

14,324,634

 

$

115,090

 

3.23%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

4,596,129

 

 

 

 

 

 

 

3,835,344

 

 

 

 

 

Other liabilities

 

521,294

 

 

 

 

 

 

 

494,535

 

 

 

 

 

Total liabilities

 

21,598,269

 

 

 

 

 

 

 

18,654,513

 

 

 

 

 

Stockholders' equity

 

3,021,929

 

 

 

 

 

 

 

2,568,243

 

 

 

 

 

Total liabilities and stockholders' equity

$

24,620,198

 

 

 

 

 

 

$

21,222,756

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income (FTE)

 

 

 

$

188,348

 

 

 

 

 

 

$

151,546

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate spread

 

 

 

 

 

 

2.63%

 

 

 

 

 

 

 

2.39%

Cost of funds

 

 

 

 

 

 

2.50%

 

 

 

 

 

 

 

2.43%

Net interest margin (FTE)

 

 

 

 

 

 

3.46%

 

 

 

 

 

 

 

3.19%

_______________________________

(1)

Income and yields are reported on a taxable equivalent basis using the statutory federal corporate tax rate of 21%.

(2)

Rates and yields are annualized and calculated from rounded amounts in thousands, which appear above.

(3)

Nonaccrual loans are included in average loans outstanding.

(4)

Interest income on loans includes $15.7 million and $819,000 for the three months ended June 30, 2024 and March 31, 2024, respectively, in accretion of the fair market value adjustments related to acquisitions.

(5)

Interest expense on time deposits includes $1.0 million and $1,000 for the three months ended June 30, 2024 and March 31, 2024, respectively, in accretion of the fair market value adjustments related to acquisitions.

(6)

Interest expense on borrowings includes $285,000 and $216,000 for the three months ended June 30, 2024 and March 31, 2024, respectively, in amortization of the fair market value adjustments related to acquisitions.

 

Contacts

Robert M. Gorman - (804) 523‑7828

Executive Vice President / Chief Financial Officer

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