UMB Financial Corporation Reports Second Quarter Income from Continuing Operations of $57.0 Million or $1.16 per Diluted Share
KANSAS CITY, Mo.--(BUSINESS WIRE)-- UMB Financial Corporation (Nasdaq: UMBF), a financial services company, announced income from continuing operations for the second quarter 2019 of $57.0 million, or $1.16 per diluted share, compared to $57.7 million, or $1.18 per diluted share, in the first quarter 2019 (linked quarter) and $55.4 million, or $1.11 per diluted share, in the second quarter 2018. The reported GAAP income from continuing operations represents a decrease of 1.4 percent on a linked-quarter basis and an increase of 2.8 percent compared to the second quarter 2018.
Net operating income from continuing operations, a non-GAAP financial measure reconciled to income from continuing operations, the nearest comparable GAAP measure, later in this release, was $57.2 million, or $1.17 per diluted share, for the second quarter 2019, compared to $58.2 million, or $1.19 per diluted share, for the linked quarter and $56.1 million, or $1.12 per diluted share, for the second quarter 2018. These results represent a decrease of 1.7 percent on a linked-quarter basis and an increase of 2.1 percent compared to second quarter 2018.
Summary of quarterly financial results |
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UMB Financial Corporation |
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(unaudited, dollars in thousands, except per share data) |
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Q2 |
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Q1 |
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Q2 |
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2019 |
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2019 |
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2018 |
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|||
Income from continuing operations |
|
$ |
56,959 |
|
|
$ |
57,744 |
|
|
$ |
55,424 |
|
Loss from discontinued operations |
|
|
— |
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|
|
— |
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|
|
— |
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Net income |
|
|
56,959 |
|
|
|
57,744 |
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|
|
55,424 |
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|
|
|
|
|
|
|
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|
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|
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|
Earnings per share from continuing operations (diluted) |
|
|
1.16 |
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|
|
1.18 |
|
|
|
1.11 |
|
Losses per share from discontinued operations (diluted) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Earnings per share (diluted) |
|
|
1.16 |
|
|
|
1.18 |
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|
1.11 |
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|
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|
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|
|
|
Net operating income from continuing operations |
|
|
57,245 |
|
|
|
58,208 |
|
|
|
56,079 |
|
Operating earnings per share from continuing operations (diluted) |
|
|
1.17 |
|
|
|
1.19 |
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|
1.12 |
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GAAP - continuing operations |
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Return on average assets |
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|
0.98 |
% |
|
|
1.02 |
% |
|
|
1.08 |
% |
Return on average equity |
|
|
9.46 |
|
|
|
10.48 |
|
|
|
10.18 |
|
Efficiency ratio |
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|
70.32 |
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|
70.00 |
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|
70.21 |
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|
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Non-GAAP - continuing operations |
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Operating return on average assets |
|
|
0.99 |
% |
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|
1.03 |
% |
|
|
1.09 |
% |
Operating return on average equity |
|
|
9.51 |
|
|
|
10.56 |
|
|
|
10.30 |
|
Operating efficiency ratio |
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|
70.19 |
|
|
|
69.78 |
|
|
|
69.88 |
|
Summary of year-to-date financial results |
|
UMB Financial Corporation |
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|||||
(unaudited, dollars in thousands, except per share data) |
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June |
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June |
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YTD |
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YTD |
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2019 |
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2018 |
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Income from continuing operations |
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$ |
114,703 |
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|
$ |
112,957 |
|
Loss from discontinued operations |
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|
— |
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|
|
(747 |
) |
Net income |
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|
114,703 |
|
|
|
112,210 |
|
|
|
|
|
|
|
|
|
|
Earnings per share from continuing operations (diluted) |
|
|
2.34 |
|
|
|
2.26 |
|
Losses per share from discontinued operations (diluted) |
|
|
— |
|
|
|
(0.01 |
) |
Earnings per share (diluted) |
|
|
2.34 |
|
|
|
2.25 |
|
|
|
|
|
|
|
|
|
|
Net operating income from continuing operations |
|
|
115,453 |
|
|
|
115,141 |
|
Operating earnings per share from continuing operations (diluted) |
|
|
2.36 |
|
|
|
2.30 |
|
|
|
|
|
|
|
|
|
|
GAAP - continuing operations |
|
|
|
|
|
|
|
|
Return on average assets |
|
|
1.00 |
% |
|
|
1.10 |
% |
Return on average equity |
|
|
9.95 |
|
|
|
10.49 |
|
Efficiency ratio |
|
|
70.16 |
|
|
|
69.51 |
|
|
|
|
|
|
|
|
|
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Non-GAAP - continuing operations |
|
|
|
|
|
|
|
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Operating return on average assets |
|
|
1.01 |
% |
|
|
1.12 |
% |
Operating return on average equity |
|
|
10.01 |
|
|
|
10.69 |
|
Operating efficiency ratio |
|
|
69.98 |
|
|
|
68.95 |
|
“Our results in the second quarter were driven by fee income and balance sheet expansion, which included average loan growth of 10.3 percent on an annualized basis,” said Mariner Kemper, chairman, president and chief executive officer. “Average total assets for the second quarter were $23.3 billion, an increase of 1.8 percent compared to first quarter and 12.9 percent compared to the second quarter 2018.”
Discussion of results from continuing operations
Summary of revenue |
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UMB Financial Corporation |
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(unaudited, dollars in thousands) |
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Q2 |
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|
Q1 |
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|
Q2 |
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CQ vs. |
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CQ vs. |
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|||||
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|
2019 |
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|
2019 |
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|
2018 |
|
|
LQ |
|
|
PY |
|
|||||
Net interest income |
|
$ |
166,414 |
|
|
$ |
163,868 |
|
|
$ |
150,226 |
|
|
$ |
2,546 |
|
|
$ |
16,188 |
|
Noninterest income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trust and securities processing |
|
|
42,903 |
|
|
|
41,957 |
|
|
|
42,845 |
|
|
|
946 |
|
|
|
58 |
|
Trading and investment banking |
|
|
5,453 |
|
|
|
5,581 |
|
|
|
4,653 |
|
|
|
(128 |
) |
|
|
800 |
|
Service charges on deposit accounts |
|
|
20,747 |
|
|
|
21,281 |
|
|
|
20,722 |
|
|
|
(534 |
) |
|
|
25 |
|
Insurance fees and commissions |
|
|
465 |
|
|
|
338 |
|
|
|
340 |
|
|
|
127 |
|
|
|
125 |
|
Brokerage fees |
|
|
7,077 |
|
|
|
7,243 |
|
|
|
6,291 |
|
|
|
(166 |
) |
|
|
786 |
|
Bankcard fees |
|
|
16,439 |
|
|
|
17,067 |
|
|
|
17,184 |
|
|
|
(628 |
) |
|
|
(745 |
) |
(Losses) gains on sales of securities available for sale, net |
|
|
(1,403 |
) |
|
|
809 |
|
|
|
228 |
|
|
|
(2,212 |
) |
|
|
(1,631 |
) |
Other |
|
|
13,717 |
|
|
|
13,106 |
|
|
|
8,026 |
|
|
|
611 |
|
|
|
5,691 |
|
Total noninterest income |
|
$ |
105,398 |
|
|
$ |
107,382 |
|
|
$ |
100,289 |
|
|
$ |
(1,984 |
) |
|
$ |
5,109 |
|
Total revenue |
|
$ |
271,812 |
|
|
$ |
271,250 |
|
|
$ |
250,515 |
|
|
$ |
562 |
|
|
$ |
21,297 |
|
Net interest margin |
|
|
3.19 |
% |
|
|
3.20 |
% |
|
|
3.24 |
% |
|
|
|
|
|
|
|
|
Total noninterest income as a % of total revenue |
|
|
38.78 |
|
|
|
39.59 |
|
|
|
40.03 |
|
|
|
|
|
|
|
|
|
Net interest income
- Net interest income totaled $166.4 million, an increase of $2.5 million, or 1.6 percent, from linked-quarter levels, impacted by a $317.8 million, or 2.6 percent, increase in average loans, a $303.6 million, or 3.8 percent, increase in average securities and one additional day in the second quarter.
- Net interest margin for the second quarter was 3.19 percent, down one basis point from the linked quarter, in large part due to lower short-term interest rates. Earning asset yields improved one basis point from the linked quarter in part driven by improved yields in the securities portfolio. The cost of interest-bearing liabilities increased five basis points to 1.39 percent, driven by an increase of $174.2 million in federal funds and repurchase agreements, and a four-basis-point increase in cost of interest-bearing deposits.
- On a year-over-year basis, the increase in net interest income was driven by a 10.3 percent, or $1.2 billion, increase in average loans, as well as higher average loan yields, which increased 40 basis points compared to 2018, primarily driven by higher short-term interest rates, volume and asset mix changes.
- For the second quarter 2019, average earning assets stood at $21.7 billion, an increase of 12.9 percent over the second quarter 2018.
Noninterest income
-
Second quarter 2019 noninterest income decreased $2.0 million, or 1.8 percent, on a linked-quarter basis, largely due to:
- A decrease of $2.2 million in gains on sales of available-for-sale securities. This decrease includes losses of $1.4 million realized in the second quarter of 2019.
- A decrease of $0.6 million in bankcard fees primarily driven by an increase of $1.7 million in rebates expense recorded as contra-revenue, offset by an increase of $0.8 million in interchange income.
- A decrease in company-owned life insurance of $3.4 million, recorded in other income, which is offset by a proportionate decrease in deferred compensation expense noted below.
- These decreases were partially offset by increases of $1.1 million in equity earnings on alternative investments, recorded in other income, and $0.7 million in corporate trust income, recorded in trust and securities processing.
-
Compared to the prior year, noninterest income in the second quarter of 2019 increased $5.1 million, or 5.1 percent, primarily driven by:
- Increases of $1.4 million in derivative income, $1.2 million in equity earnings on alternative investments, and $0.8 million in company-owned life insurance, all of which are recorded in other income. The increase in company-owned life insurance is offset by a proportionate increase in deferred compensation expense noted below.
- A $0.8 million increase in trading and investment banking income due to increased trading volume.
Noninterest expense
Summary of noninterest expense |
|
UMB Financial Corporation |
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(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
Q2 |
|
|
Q1 |
|
|
Q2 |
|
|
CQ vs. |
|
|
CQ vs. |
|
|||||
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
LQ |
|
|
PY |
|
|||||
Salaries and employee benefits |
|
$ |
114,454 |
|
|
$ |
116,032 |
|
|
$ |
104,175 |
|
|
$ |
(1,578 |
) |
|
$ |
10,279 |
|
Occupancy, net |
|
|
11,539 |
|
|
|
11,743 |
|
|
|
10,813 |
|
|
|
(204 |
) |
|
|
726 |
|
Equipment |
|
|
18,824 |
|
|
|
19,684 |
|
|
|
18,842 |
|
|
|
(860 |
) |
|
|
(18 |
) |
Supplies and services |
|
|
4,285 |
|
|
|
3,873 |
|
|
|
4,146 |
|
|
|
412 |
|
|
|
139 |
|
Marketing and business development |
|
|
7,304 |
|
|
|
4,913 |
|
|
|
6,184 |
|
|
|
2,391 |
|
|
|
1,120 |
|
Processing fees |
|
|
13,096 |
|
|
|
12,132 |
|
|
|
11,537 |
|
|
|
964 |
|
|
|
1,559 |
|
Legal and consulting |
|
|
7,496 |
|
|
|
5,633 |
|
|
|
6,460 |
|
|
|
1,863 |
|
|
|
1,036 |
|
Bankcard |
|
|
4,701 |
|
|
|
4,345 |
|
|
|
4,165 |
|
|
|
356 |
|
|
|
536 |
|
Amortization of other intangible assets |
|
|
1,251 |
|
|
|
1,327 |
|
|
|
1,485 |
|
|
|
(76 |
) |
|
|
(234 |
) |
Regulatory fees |
|
|
2,910 |
|
|
|
2,890 |
|
|
|
3,772 |
|
|
|
20 |
|
|
|
(862 |
) |
Other |
|
|
7,527 |
|
|
|
8,054 |
|
|
|
5,639 |
|
|
|
(527 |
) |
|
|
1,888 |
|
Total noninterest expense |
|
$ |
193,387 |
|
|
$ |
190,626 |
|
|
$ |
177,218 |
|
|
$ |
2,761 |
|
|
$ |
16,169 |
|
- GAAP noninterest expense for the second quarter of 2019 was $193.4 million, an increase of $2.8 million, or 1.4 percent, from the linked quarter and an increase of $16.2 million, or 9.1 percent, from the second quarter of 2018.
- On a non-GAAP basis, operating noninterest expense (as reconciled later in this release) was $193.0 million for the second quarter 2019, an increase of $3.0 million, or 1.6 percent, compared to the linked quarter and an increase of $16.6 million, or 9.4 percent, compared to the second quarter 2018.
-
The linked quarter increase in noninterest expense was driven by:
- An increase of $2.4 million in marketing and development expense and an increase of $1.9 million in legal and consulting expense, due to the timing of multiple technology and product initiatives.
- These increases were partially offset by a decrease of $1.6 million in salaries and employee benefits, largely driven by lower payroll taxes and deferred compensation expense, partially offset by increased employee salaries and bonus and commission expense, as compared to the first quarter of 2019.
-
The year-over-year increase in noninterest expense was driven by:
- A $10.3 million increase in salaries and employee benefits, largely due to increases of $4.2 million in bonus and commission expense, $4.0 million in salaries and wages expense, and $0.9 million in deferred compensation expense, which is offset by the increase in company-owned life insurance noted above.
- An increase of $1.6 million in derivative expense, recorded in other noninterest expense.
- A $1.6 million increase in processing fees expense due to investments in digital channel and integrated platform solutions to support business growth and the ongoing modernization of the company’s core systems.
- An increase of $1.1 million in marketing and development expense and an increase of $1.0 million in legal and consulting expense, due to the timing of multiple technology and product initiatives.
Income taxes
- The company’s effective tax rate was 15.5 percent for the six months ended June 30, 2019, compared to 15.6 percent for the same period in 2018.
Balance sheet
- Average total assets for the second quarter 2019 were $23.3 billion compared to $22.9 billion for the linked quarter and $20.6 billion for the same period in 2018.
Summary of average loans and leases - QTD Average |
UMB Financial Corporation |
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(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q2 |
|
|
Q1 |
|
|
Q2 |
|
|
CQ vs. |
|
|
CQ vs. |
|
|||||
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
LQ |
|
|
PY |
|
|||||
Commercial |
|
$ |
5,427,498 |
|
|
$ |
5,270,130 |
|
|
$ |
4,478,829 |
|
|
$ |
157,368 |
|
|
$ |
948,669 |
|
Asset-based loans |
|
|
387,983 |
|
|
|
378,508 |
|
|
|
336,710 |
|
|
|
9,475 |
|
|
|
51,273 |
|
Factoring loans |
|
|
261,041 |
|
|
|
263,093 |
|
|
|
231,035 |
|
|
|
(2,052 |
) |
|
|
30,006 |
|
Commercial credit card |
|
|
196,313 |
|
|
|
195,872 |
|
|
|
191,009 |
|
|
|
441 |
|
|
|
5,304 |
|
Real estate - construction |
|
|
889,233 |
|
|
|
787,483 |
|
|
|
823,169 |
|
|
|
101,750 |
|
|
|
66,064 |
|
Real estate - commercial |
|
|
3,831,818 |
|
|
|
3,797,206 |
|
|
|
3,711,417 |
|
|
|
34,612 |
|
|
|
120,401 |
|
Real estate - residential |
|
|
744,750 |
|
|
|
714,534 |
|
|
|
669,177 |
|
|
|
30,216 |
|
|
|
75,573 |
|
Real estate - HELOC |
|
|
514,044 |
|
|
|
528,468 |
|
|
|
596,025 |
|
|
|
(14,424 |
) |
|
|
(81,981 |
) |
Consumer credit card |
|
|
230,863 |
|
|
|
217,570 |
|
|
|
230,971 |
|
|
|
13,293 |
|
|
|
(108 |
) |
Consumer other |
|
|
132,662 |
|
|
|
145,100 |
|
|
|
153,427 |
|
|
|
(12,438 |
) |
|
|
(20,765 |
) |
Leases |
|
|
4,776 |
|
|
|
5,190 |
|
|
|
22,679 |
|
|
|
(414 |
) |
|
|
(17,903 |
) |
Total loans |
|
$ |
12,620,981 |
|
|
$ |
12,303,154 |
|
|
$ |
11,444,448 |
|
|
$ |
317,827 |
|
|
$ |
1,176,533 |
|
- Average loans for the second quarter 2019 increased 2.6 percent on a linked-quarter basis and 10.3 percent compared to the second quarter of 2018.
Summary of average securities - QTD Average |
|
UMB Financial Corporation |
|
|||||||||||||||||
(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q2 |
|
|
Q1 |
|
|
Q2 |
|
|
CQ vs. |
|
|
CQ vs. |
|
|||||
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
LQ |
|
|
PY |
|
|||||
Securities available for sale: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Treasury |
|
$ |
256,949 |
|
|
$ |
256,672 |
|
|
$ |
37,982 |
|
|
$ |
277 |
|
|
$ |
218,967 |
|
U.S. Agencies |
|
|
91,822 |
|
|
|
53,458 |
|
|
|
2,946 |
|
|
|
38,364 |
|
|
|
88,876 |
|
Mortgage-backed |
|
|
3,926,164 |
|
|
|
3,841,449 |
|
|
|
3,679,835 |
|
|
|
84,715 |
|
|
|
246,329 |
|
State and political subdivisions |
|
|
2,659,397 |
|
|
|
2,534,438 |
|
|
|
2,330,454 |
|
|
|
124,959 |
|
|
|
328,943 |
|
Corporates |
|
|
84,910 |
|
|
|
6,424 |
|
|
|
1,476 |
|
|
|
78,486 |
|
|
|
83,434 |
|
Commercial Paper |
|
|
— |
|
|
|
— |
|
|
|
7,138 |
|
|
|
— |
|
|
|
(7,138 |
) |
Total securities available for sale |
|
$ |
7,019,242 |
|
|
$ |
6,692,441 |
|
|
$ |
6,059,831 |
|
|
$ |
326,801 |
|
|
$ |
959,411 |
|
Securities held to maturity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
State and political subdivisions |
|
|
1,128,526 |
|
|
|
1,157,126 |
|
|
|
1,228,849 |
|
|
|
(28,600 |
) |
|
|
(100,323 |
) |
Trading securities |
|
|
61,565 |
|
|
|
46,408 |
|
|
|
45,538 |
|
|
|
15,157 |
|
|
|
16,027 |
|
Other securities |
|
|
80,097 |
|
|
|
74,718 |
|
|
|
66,345 |
|
|
|
5,379 |
|
|
|
13,752 |
|
Total securities |
|
$ |
8,289,430 |
|
|
$ |
7,970,693 |
|
|
$ |
7,400,563 |
|
|
$ |
318,737 |
|
|
$ |
888,867 |
|
- Average securities available for sale increased 4.9 percent on a linked-quarter basis and increased 15.8 percent compared to the second quarter of 2018.
Summary of average deposits - QTD Average |
UMB Financial Corporation |
|
||||||||||||||||||
(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q2 |
|
|
Q1 |
|
|
Q2 |
|
|
CQ vs. |
|
|
CQ vs. |
|
|||||
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
LQ |
|
|
PY |
|
|||||
Deposits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing demand |
|
$ |
6,078,520 |
|
|
$ |
5,989,215 |
|
|
$ |
5,666,364 |
|
|
$ |
89,305 |
|
|
$ |
412,156 |
|
Interest-bearing demand and savings |
|
|
11,740,634 |
|
|
|
11,698,351 |
|
|
|
9,768,015 |
|
|
|
42,283 |
|
|
|
1,972,619 |
|
Time deposits |
|
|
966,719 |
|
|
|
1,034,763 |
|
|
|
1,032,000 |
|
|
|
(68,044 |
) |
|
|
(65,281 |
) |
Total deposits |
|
$ |
18,785,873 |
|
|
$ |
18,722,329 |
|
|
$ |
16,466,379 |
|
|
$ |
63,544 |
|
|
$ |
2,319,494 |
|
Noninterest bearing deposits as % of total |
|
|
32.36 |
% |
|
|
31.99 |
% |
|
|
34.41 |
% |
|
|
|
|
|
|
|
|
- Average deposits increased 0.3 percent on a linked-quarter basis and 14.1 percent compared to the second quarter of 2018.
Capital
Capital information |
|
UMB Financial Corporation |
|
|||||||||
(unaudited, dollars in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2019 |
|
|
March 31, 2019 |
|
|
June 30, 2018 |
|
|||
Total equity |
|
$ |
2,477,790 |
|
|
$ |
2,350,843 |
|
|
$ |
2,201,812 |
|
Book value per common share |
|
|
50.50 |
|
|
|
47.92 |
|
|
|
43.96 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regulatory capital: |
|
|
|
|
|
|
|
|
|
|
|
|
Common equity Tier 1 capital |
|
$ |
2,236,930 |
|
|
$ |
2,188,521 |
|
|
$ |
2,145,617 |
|
Tier 1 capital |
|
|
2,236,930 |
|
|
|
2,188,521 |
|
|
|
2,145,617 |
|
Total capital |
|
|
2,411,510 |
|
|
|
2,364,465 |
|
|
|
2,315,483 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regulatory capital ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
Common equity Tier 1 capital ratio |
|
|
12.65 |
% |
|
|
12.70 |
% |
|
|
13.56 |
% |
Tier 1 risk-based capital ratio |
|
|
12.65 |
|
|
|
12.70 |
|
|
|
13.56 |
|
Total risk-based capital ratio |
|
|
13.63 |
|
|
|
13.72 |
|
|
|
14.63 |
|
Tier 1 leverage ratio |
|
|
9.69 |
|
|
|
9.65 |
|
|
|
10.50 |
|
- At June 30, 2019, the regulatory capital ratios presented in the foregoing table exceeded all “well-capitalized” regulatory thresholds.
Asset Quality
Credit quality |
|
UMB Financial Corporation |
|
|||||||||||||||||
(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q2 |
|
|
Q1 |
|
|
Q4 |
|
|
Q3 |
|
|
Q2 |
|
|||||
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
2018 |
|
|
2018 |
|
|||||
Net charge-offs - Commercial loans |
|
$ |
11,790 |
|
|
$ |
10,537 |
|
|
$ |
44,010 |
|
|
$ |
624 |
|
|
$ |
6,137 |
|
Net (recoveries) charge-offs - Real estate loans |
|
|
(714 |
) |
|
|
41 |
|
|
|
28 |
|
|
|
408 |
|
|
|
1,035 |
|
Net charge-offs - Consumer credit card loans |
|
|
1,336 |
|
|
|
1,676 |
|
|
|
1,606 |
|
|
|
1,632 |
|
|
|
1,786 |
|
Net charge-offs - Consumer other loans |
|
|
157 |
|
|
|
70 |
|
|
|
23 |
|
|
|
82 |
|
|
|
46 |
|
Net charge-offs - Total loans |
|
|
12,569 |
|
|
|
12,324 |
|
|
|
45,667 |
|
|
|
2,746 |
|
|
|
9,004 |
|
Net loan charge-offs as a % of total average loans |
|
|
0.40 |
% |
|
|
0.41 |
% |
|
|
1.51 |
% |
|
|
0.09 |
% |
|
|
0.32 |
% |
Loans over 90 days past due |
|
$ |
1,825 |
|
|
$ |
1,874 |
|
|
$ |
6,009 |
|
|
$ |
1,927 |
|
|
$ |
2,883 |
|
Loans over 90 days past due as a % of total loans |
|
|
0.01 |
% |
|
|
0.01 |
% |
|
|
0.05 |
% |
|
|
0.02 |
% |
|
|
0.02 |
% |
Nonaccrual and restructured loans |
|
$ |
53,395 |
|
|
$ |
63,270 |
|
|
$ |
43,018 |
|
|
$ |
50,568 |
|
|
$ |
56,030 |
|
Nonaccrual and restructured loans as a % of total loans |
|
|
0.41 |
% |
|
|
0.50 |
% |
|
|
0.35 |
% |
|
|
0.42 |
% |
|
|
0.48 |
% |
Provision for loan losses |
|
$ |
11,000 |
|
|
$ |
12,350 |
|
|
$ |
48,000 |
|
|
$ |
5,750 |
|
|
$ |
7,000 |
|
- Nonperforming loans, defined as restructured loans on nonaccrual and all other nonaccrual loans, decreased $9.9 million from the linked quarter and decreased $2.6 million from the second quarter of 2018.
- Net charge-offs were $12.6 million, or 0.40 percent, of average loans, compared to $12.3 million, or 0.41 percent, of average loans in the linked quarter, and $9.0 million, or 0.32 percent, of average loans in the second quarter of 2018.
- Provision for loan losses decreased $1.4 million from the linked quarter, and increased $4.0 million from the second quarter of 2018, consistent with the company’s methodology, which considers the inherent risk in the loan portfolio, as well as other qualitative factors, such as macroeconomic conditions, loan growth, loan impairment changes, loan risk grading changes and net charge-off levels.
Dividend Declaration
At the company’s quarterly board meeting, the Board of Directors declared a $0.30 per share quarterly cash dividend, payable on October 1, 2019, to shareholders of record at the close of business on September 10, 2019.
Conference Call
The company plans to host a conference call to discuss its second quarter 2019 earnings results on Wednesday, July 31, 2019, at 8:30 a.m. (CT).
Interested parties may access the call by dialing (toll-free) 877-267-8760 or (international) 412-542-4148 and requesting to join the UMB Financial call. The live call may also be accessed by visiting investorrelations.umb.com or by using the following link:
UMB Financial 2Q 2019 Conference Call
A replay of the conference call may be heard through August 14, 2019 by calling (toll-free) 877-344-7529 or (international) 412-317-0088. The replay access code required for playback is 10133170. The call replay may also be accessed at investorrelations.umb.com.
Non-GAAP Financial Information
In this release, we provide information about net operating income from continuing operations (net operating income), operating earnings per share from continuing operations - diluted (operating EPS), operating return on average equity (operating ROE), operating return on average assets (operating ROA), operating noninterest expense, and operating efficiency ratio, all of which are non-GAAP financial measures. This information supplements the results that are reported according to generally accepted accounting principles in the United States (GAAP) and should not be viewed in isolation from, or as a substitute for, GAAP results. The differences between the non-GAAP financial measures – net operating income, operating EPS, operating ROE, operating ROA, operating noninterest expense, and operating efficiency ratio – and the nearest comparable GAAP financial measures are reconciled later in this release. The company believes that these non-GAAP financial measures and the reconciliations may be useful to investors because they adjust for acquisition-, divestiture-, and severance-related items that management does not believe reflect the company’s fundamental operating performance.
Net operating income for the relevant period is defined as GAAP net income, adjusted to reflect the impact of excluding expenses related to acquisitions and divestitures, severance expense, and the cumulative tax impact of these adjustments.
Operating EPS (diluted) is calculated as earnings per share as reported, adjusted to reflect, on a per share basis, the impact of excluding the non-GAAP adjustments described above for the relevant period. Operating ROE is calculated as net operating income from continuing operations, divided by the company’s average total shareholders’ equity for the relevant period. Operating ROA is calculated as net operating income from continuing operations, divided by the company’s average assets for the relevant period. Operating noninterest expense for the relevant period is defined as GAAP noninterest expense, adjusted to reflect the pre-tax impact of non-GAAP adjustments described above. Operating efficiency ratio is calculated as the company’s operating noninterest expense, net of amortization of other intangibles, divided by the company’s total non-GAAP revenue (calculated as net interest income plus noninterest income, less gains on sales of securities available for sale, net).
Forward-Looking Statements:
This press release contains, and our other communications may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as “believe,” “expect,” “anticipate,” “intend,” “estimate,” “project,” “outlook,” “forecast,” “target,” “trend,” “plan,” “goal,” or other words of comparable meaning or future-tense or conditional verbs such as “may,” “will,” “should,” “would,” or “could.” Forward-looking statements convey our expectations, intentions, or forecasts about future events, circumstances, results, or aspirations. All forward-looking statements are subject to assumptions, risks, and uncertainties, which may change over time and many of which are beyond our control. You should not rely on any forward-looking statement as a prediction or guarantee about the future. Our actual future objectives, strategies, plans, prospects, performance, condition, or results may differ materially from those set forth in any forward-looking statement. Some of the factors that may cause actual results or other future events, circumstances, or aspirations to differ from those in forward-looking statements are described in our Annual Report on Form 10-K for the year ended December 31, 2018, our subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K, or other applicable documents that are filed or furnished with the U.S. Securities and Exchange Commission (SEC). Any forward-looking statement made by us or on our behalf speaks only as of the date that it was made. We do not undertake to update any forward-looking statement to reflect the impact of events, circumstances, or results that arise after the date that the statement was made, except to the extent required by applicable securities laws. You, however, should consult further disclosures (including disclosures of a forward-looking nature) that we may make in any subsequent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K, or other applicable document that is filed or furnished with the SEC.
About UMB:
UMB Financial Corporation (Nasdaq: UMBF) is a financial services company headquartered in Kansas City, Mo. UMB offers personal banking, commercial banking, healthcare services and institutional banking, which includes services to mutual funds and alternative-investment entities and registered investment advisors. UMB operates banking and wealth management centers throughout Missouri, Illinois, Colorado, Kansas, Oklahoma, Nebraska, Arizona and Texas. For more information, visit UMB.com, UMB Blog or follow us on Twitter at @UMBBank, UMB Facebook and UMB LinkedIn.
Consolidated Balance Sheets |
|
UMB Financial Corporation |
|
|||||
(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|||||
|
|
2019 |
|
|
2018 |
|
||
ASSETS |
|
|
|
|
|
|
|
|
Loans |
|
$ |
12,900,269 |
|
|
$ |
11,631,628 |
|
Allowance for loan losses |
|
|
(102,092 |
) |
|
|
(98,298 |
) |
Net loans |
|
|
12,798,177 |
|
|
|
11,533,330 |
|
Loans held for sale |
|
|
2,771 |
|
|
|
3,482 |
|
Investment Securities: |
|
|
|
|
|
|
|
|
Available for sale |
|
|
7,176,351 |
|
|
|
6,011,684 |
|
Held to maturity |
|
|
1,112,773 |
|
|
|
1,204,582 |
|
Trading securities |
|
|
81,381 |
|
|
|
67,091 |
|
Other securities |
|
|
89,302 |
|
|
|
66,547 |
|
Total investment securities |
|
|
8,459,807 |
|
|
|
7,349,904 |
|
Federal funds sold and resell agreements |
|
|
283,603 |
|
|
|
70,346 |
|
Interest-bearing due from banks |
|
|
876,551 |
|
|
|
113,875 |
|
Cash and due from banks |
|
|
422,648 |
|
|
|
379,433 |
|
Premises and equipment, net |
|
|
278,725 |
|
|
|
274,408 |
|
Accrued income |
|
|
124,396 |
|
|
|
100,133 |
|
Goodwill |
|
|
180,867 |
|
|
|
180,867 |
|
Other intangibles, net |
|
|
12,425 |
|
|
|
17,210 |
|
Other assets |
|
|
576,306 |
|
|
|
508,482 |
|
Total assets |
|
$ |
24,016,276 |
|
|
$ |
20,531,470 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
|
Noninterest-bearing demand |
|
$ |
6,524,428 |
|
|
$ |
5,994,426 |
|
Interest-bearing demand and savings |
|
|
11,870,782 |
|
|
|
9,471,698 |
|
Time deposits under $250,000 |
|
|
610,711 |
|
|
|
512,446 |
|
Time deposits of $250,000 or more |
|
|
394,309 |
|
|
|
407,508 |
|
Total deposits |
|
|
19,400,230 |
|
|
|
16,386,078 |
|
Federal funds purchased and repurchase agreements |
|
|
1,708,884 |
|
|
|
1,666,158 |
|
Long-term debt |
|
|
88,569 |
|
|
|
78,692 |
|
Accrued expenses and taxes |
|
|
198,141 |
|
|
|
147,608 |
|
Other liabilities |
|
|
142,662 |
|
|
|
51,122 |
|
Total liabilities |
|
|
21,538,486 |
|
|
|
18,329,658 |
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Common stock |
|
|
55,057 |
|
|
|
55,057 |
|
Capital surplus |
|
|
1,065,301 |
|
|
|
1,050,660 |
|
Retained earnings |
|
|
1,573,586 |
|
|
|
1,434,342 |
|
Accumulated other comprehensive income (loss), net |
|
|
62,617 |
|
|
|
(128,959 |
) |
Treasury stock |
|
|
(278,771 |
) |
|
|
(209,288 |
) |
Total shareholders' equity |
|
|
2,477,790 |
|
|
|
2,201,812 |
|
Total liabilities and shareholders' equity |
|
$ |
24,016,276 |
|
|
$ |
20,531,470 |
|
Consolidated Statements of Income |
|
UMB Financial Corporation |
|
|||||||||||||
(unaudited, dollars in thousands except share and per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||
INTEREST INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans |
|
$ |
161,838 |
|
|
$ |
135,150 |
|
|
$ |
319,099 |
|
|
$ |
261,284 |
|
Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable interest |
|
|
26,700 |
|
|
|
20,523 |
|
|
|
52,091 |
|
|
|
40,303 |
|
Tax-exempt interest |
|
|
21,988 |
|
|
|
18,290 |
|
|
|
42,685 |
|
|
|
36,993 |
|
Total securities income |
|
|
48,688 |
|
|
|
38,813 |
|
|
|
94,776 |
|
|
|
77,296 |
|
Federal funds and resell agreements |
|
|
2,526 |
|
|
|
752 |
|
|
|
6,151 |
|
|
|
1,790 |
|
Interest-bearing due from banks |
|
|
2,768 |
|
|
|
1,056 |
|
|
|
6,667 |
|
|
|
2,636 |
|
Trading securities |
|
|
842 |
|
|
|
709 |
|
|
|
1,276 |
|
|
|
1,139 |
|
Total interest income |
|
|
216,662 |
|
|
|
176,480 |
|
|
|
427,969 |
|
|
|
344,145 |
|
INTEREST EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
39,516 |
|
|
|
18,334 |
|
|
|
77,350 |
|
|
|
32,169 |
|
Federal funds and repurchase agreements |
|
|
9,347 |
|
|
|
6,666 |
|
|
|
17,611 |
|
|
|
11,398 |
|
Other |
|
|
1,385 |
|
|
|
1,254 |
|
|
|
2,726 |
|
|
|
2,430 |
|
Total interest expense |
|
|
50,248 |
|
|
|
26,254 |
|
|
|
97,687 |
|
|
|
45,997 |
|
Net interest income |
|
|
166,414 |
|
|
|
150,226 |
|
|
|
330,282 |
|
|
|
298,148 |
|
Provision for loan losses |
|
|
11,000 |
|
|
|
7,000 |
|
|
|
23,350 |
|
|
|
17,000 |
|
Net interest income after provision for loan losses |
|
|
155,414 |
|
|
|
143,226 |
|
|
|
306,932 |
|
|
|
281,148 |
|
NONINTEREST INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trust and securities processing |
|
|
42,903 |
|
|
|
42,845 |
|
|
|
84,860 |
|
|
|
86,847 |
|
Trading and investment banking |
|
|
5,453 |
|
|
|
4,653 |
|
|
|
11,034 |
|
|
|
8,754 |
|
Service charges on deposit accounts |
|
|
20,747 |
|
|
|
20,722 |
|
|
|
42,028 |
|
|
|
42,627 |
|
Insurance fees and commissions |
|
|
465 |
|
|
|
340 |
|
|
|
803 |
|
|
|
641 |
|
Brokerage fees |
|
|
7,077 |
|
|
|
6,291 |
|
|
|
14,320 |
|
|
|
12,644 |
|
Bankcard fees |
|
|
16,439 |
|
|
|
17,184 |
|
|
|
33,506 |
|
|
|
35,307 |
|
(Losses) gains on sales of securities available for sale, net |
|
|
(1,403 |
) |
|
|
228 |
|
|
|
(594 |
) |
|
|
367 |
|
Other |
|
|
13,717 |
|
|
|
8,026 |
|
|
|
26,823 |
|
|
|
18,627 |
|
Total noninterest income |
|
|
105,398 |
|
|
|
100,289 |
|
|
|
212,780 |
|
|
|
205,814 |
|
NONINTEREST EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
|
|
114,454 |
|
|
|
104,175 |
|
|
|
230,486 |
|
|
|
212,143 |
|
Occupancy, net |
|
|
11,539 |
|
|
|
10,813 |
|
|
|
23,282 |
|
|
|
21,766 |
|
Equipment |
|
|
18,824 |
|
|
|
18,842 |
|
|
|
38,508 |
|
|
|
37,668 |
|
Supplies and services |
|
|
4,285 |
|
|
|
4,146 |
|
|
|
8,158 |
|
|
|
7,906 |
|
Marketing and business development |
|
|
7,304 |
|
|
|
6,184 |
|
|
|
12,217 |
|
|
|
11,218 |
|
Processing fees |
|
|
13,096 |
|
|
|
11,537 |
|
|
|
25,228 |
|
|
|
22,698 |
|
Legal and consulting |
|
|
7,496 |
|
|
|
6,460 |
|
|
|
13,129 |
|
|
|
10,304 |
|
Bankcard |
|
|
4,701 |
|
|
|
4,165 |
|
|
|
9,046 |
|
|
|
8,791 |
|
Amortization of other intangible assets |
|
|
1,251 |
|
|
|
1,485 |
|
|
|
2,578 |
|
|
|
3,047 |
|
Regulatory fees |
|
|
2,910 |
|
|
|
3,772 |
|
|
|
5,800 |
|
|
|
6,677 |
|
Other |
|
|
7,527 |
|
|
|
5,639 |
|
|
|
15,581 |
|
|
|
10,876 |
|
Total noninterest expense |
|
|
193,387 |
|
|
|
177,218 |
|
|
|
384,013 |
|
|
|
353,094 |
|
Income before income taxes |
|
|
67,425 |
|
|
|
66,297 |
|
|
|
135,699 |
|
|
|
133,868 |
|
Income tax expense |
|
|
10,466 |
|
|
|
10,873 |
|
|
|
20,996 |
|
|
|
20,911 |
|
Income from continuing operations |
|
|
56,959 |
|
|
|
55,424 |
|
|
|
114,703 |
|
|
|
112,957 |
|
Discontinued Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations before income taxes |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(917 |
) |
Income tax benefit |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(170 |
) |
Loss from discontinued operations |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(747 |
) |
NET INCOME |
|
$ |
56,959 |
|
|
$ |
55,424 |
|
|
$ |
114,703 |
|
|
$ |
112,210 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PER SHARE DATA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations |
|
$ |
1.17 |
|
|
$ |
1.12 |
|
|
$ |
2.35 |
|
|
$ |
2.28 |
|
Loss from discontinued operations |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.01 |
) |
Net income – basic |
|
|
1.17 |
|
|
|
1.12 |
|
|
|
2.35 |
|
|
|
2.27 |
|
Diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations |
|
|
1.16 |
|
|
|
1.11 |
|
|
|
2.34 |
|
|
|
2.26 |
|
Loss from discontinued operations |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.01 |
) |
Net income - diluted |
|
|
1.16 |
|
|
|
1.11 |
|
|
|
2.34 |
|
|
|
2.25 |
|
Dividends |
|
|
0.30 |
|
|
|
0.29 |
|
|
|
0.60 |
|
|
|
0.58 |
|
Weighted average shares outstanding - basic |
|
|
48,777,732 |
|
|
|
49,551,920 |
|
|
|
48,745,124 |
|
|
|
49,486,626 |
|
Weighted average shares outstanding - diluted |
49,039,692 |
50,007,022 |
|
|
49,018,787 |
|
|
|
49,973,992 |
|
||||||
|
||||||||||||||||
Consolidated Statements of Comprehensive Income |
|
UMB Financial Corporation |
|
|||||||||||||
(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||
Net income |
|
$ |
56,959 |
|
|
$ |
55,424 |
|
|
$ |
114,703 |
|
|
$ |
112,210 |
|
Other comprehensive income (loss), net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gains and losses on debt securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in unrealized holding gains and losses, net |
|
|
107,484 |
|
|
|
(16,020 |
) |
|
|
213,918 |
|
|
|
(96,682 |
) |
Less: Reclassification adjustment for losses (gains) included in net income |
|
|
1,403 |
|
|
|
(228 |
) |
|
|
594 |
|
|
|
(367 |
) |
Change in unrealized gains and losses on debt securities during the period |
|
|
108,887 |
|
|
|
(16,248 |
) |
|
|
214,512 |
|
|
|
(97,049 |
) |
Change in unrealized gains and losses on derivative hedges |
|
|
(3,041 |
) |
|
|
910 |
|
|
|
(5,134 |
) |
|
|
3,112 |
|
Income tax (expense) benefit |
|
|
(25,590 |
) |
|
|
3,770 |
|
|
|
(50,979 |
) |
|
|
23,552 |
|
Other comprehensive income (loss) before reclassifications |
|
|
80,256 |
|
|
|
(11,568 |
) |
|
|
158,399 |
|
|
|
(70,385 |
) |
Amounts reclassified from accumulated other comprehensive income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(13,049 |
) |
Net current-period other comprehensive income (loss) |
|
|
80,256 |
|
|
|
(11,568 |
) |
|
|
158,399 |
|
|
|
(83,434 |
) |
Comprehensive income |
|
$ |
137,215 |
|
|
$ |
43,856 |
|
|
$ |
273,102 |
|
|
$ |
28,776 |
|
Consolidated Statements of Shareholders' Equity |
UMB Financial Corporation |
|
||||||||||||||||
(unaudited, dollars in thousands except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Common
Stock |
Capital
Surplus |
|
Retained
Earnings |
|
Accumulated
|
|
Treasury
Stock |
|
Total |
|
|||||||
Balance - January 1, 2018 |
$ |
55,057 |
$ |
1,046,095 |
|
$ |
1,338,110 |
|
$ |
(45,525 |
) |
$ |
(212,206 |
) |
$ |
2,181,531 |
|
|
Total comprehensive income (loss) |
|
— |
|
— |
|
|
112,210 |
|
|
(83,434 |
) |
|
— |
|
|
28,776 |
|
|
Reclassification of certain tax effects |
|
— |
|
— |
|
|
12,917 |
|
|
— |
|
|
— |
|
|
12,917 |
|
|
Dividends ($0.58 per share) |
|
— |
|
— |
|
|
(29,040 |
) |
|
— |
|
|
— |
|
|
(29,040 |
) |
|
Purchase of treasury stock |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
(6,211 |
) |
|
(6,211 |
) |
|
Issuance of equity awards, net of forfeitures |
|
— |
|
(2,457 |
) |
|
— |
|
|
— |
|
|
2,951 |
|
|
494 |
|
|
Recognition of equity-based compensation |
|
— |
|
5,201 |
|
|
— |
|
|
— |
|
|
— |
|
|
5,201 |
|
|
Sale of treasury stock |
|
— |
|
278 |
|
|
— |
|
|
— |
|
|
275 |
|
|
553 |
|
|
Exercise of stock options |
|
— |
|
1,543 |
|
|
— |
|
|
— |
|
|
5,903 |
|
|
7,446 |
|
|
Cumulative effect adjustments |
|
— |
|
— |
|
|
145 |
|
|
— |
|
|
— |
|
|
145 |
|
|
Balance - June 30, 2018 |
$ |
55,057 |
$ |
1,050,660 |
|
$ |
1,434,342 |
|
$ |
(128,959 |
) |
$ |
(209,288 |
) |
$ |
2,201,812 |
|
|
Balance - January 1, 2019 |
$ |
55,057 |
$ |
1,054,601 |
|
$ |
1,488,421 |
|
$ |
(95,782 |
) |
$ |
(273,827 |
) |
$ |
2,228,470 |
|
|
Total comprehensive income |
|
— |
|
— |
|
|
114,703 |
|
|
158,399 |
|
|
— |
|
|
273,102 |
|
|
Dividends ($0.60 per share) |
|
— |
|
— |
|
|
(29,538 |
) |
|
— |
|
|
— |
|
|
(29,538 |
) |
|
Purchase of treasury stock |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
(4,114 |
) |
|
(4,114 |
) |
|
Issuance of equity awards, net of forfeitures |
|
— |
|
3,107 |
|
|
— |
|
|
— |
|
|
(2,503 |
) |
|
604 |
|
|
Recognition of equity-based compensation |
|
— |
|
7,006 |
|
|
— |
|
|
— |
|
|
— |
|
|
7,006 |
|
|
Sale of treasury stock |
|
— |
|
185 |
|
|
— |
|
|
— |
|
|
274 |
|
|
459 |
|
|
Exercise of stock options |
|
— |
|
402 |
|
|
— |
|
|
— |
|
|
1,399 |
|
|
1,801 |
|
|
Balance - June 30, 2019 |
$ |
55,057 |
$ |
1,065,301 |
|
$ |
1,573,586 |
|
$ |
62,617 |
|
$ |
(278,771 |
) |
$ |
2,477,790 |
|
|
Average Balances / Yields and Rates |
|
UMB Financial Corporation |
|
|||||||||||||
(tax - equivalent basis) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
|||||||||||||
|
|
2019 |
|
|
2018 |
|
||||||||||
|
|
Average |
|
|
Average |
|
|
Average |
|
|
Average |
|
||||
|
|
Balance |
|
|
Yield/Rate |
|
|
Balance |
|
|
Yield/Rate |
|
||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, net of unearned interest |
|
$ |
12,620,981 |
|
|
|
5.14 |
% |
|
$ |
11,444,448 |
|
|
|
4.74 |
% |
Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable |
|
|
4,502,680 |
|
|
|
2.38 |
|
|
|
3,862,378 |
|
|
|
2.13 |
|
Tax-exempt |
|
|
3,725,185 |
|
|
|
2.99 |
|
|
|
3,492,647 |
|
|
|
2.66 |
|
Total securities |
|
|
8,227,865 |
|
|
|
2.65 |
|
|
|
7,355,025 |
|
|
|
2.38 |
|
Federal funds and resell agreements |
|
|
329,064 |
|
|
|
3.08 |
|
|
|
107,343 |
|
|
|
2.81 |
|
Interest bearing due from banks |
|
|
450,032 |
|
|
|
2.47 |
|
|
|
252,292 |
|
|
|
1.68 |
|
Trading securities |
|
|
61,565 |
|
|
|
6.07 |
|
|
|
45,538 |
|
|
|
6.83 |
|
Total earning assets |
|
|
21,689,507 |
|
|
|
4.11 |
|
|
|
19,204,646 |
|
|
|
3.79 |
|
Allowance for loan losses |
|
|
(109,463 |
) |
|
|
|
|
|
|
(101,801 |
) |
|
|
|
|
Other assets |
|
|
1,690,423 |
|
|
|
|
|
|
|
1,516,801 |
|
|
|
|
|
Total assets |
|
$ |
23,270,467 |
|
|
|
|
|
|
$ |
20,619,646 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits |
|
$ |
12,707,353 |
|
|
|
1.25 |
% |
|
$ |
10,800,015 |
|
|
|
0.68 |
% |
Federal funds and repurchase agreements |
|
|
1,728,748 |
|
|
|
2.17 |
|
|
|
1,737,383 |
|
|
|
1.54 |
|
Borrowed funds |
|
|
81,742 |
|
|
|
6.80 |
|
|
|
78,583 |
|
|
|
6.40 |
|
Total interest-bearing liabilities |
|
|
14,517,843 |
|
|
|
1.39 |
|
|
|
12,615,981 |
|
|
|
0.83 |
|
Noninterest-bearing demand deposits |
|
|
6,078,520 |
|
|
|
|
|
|
|
5,666,364 |
|
|
|
|
|
Other liabilities |
|
|
259,810 |
|
|
|
|
|
|
|
152,491 |
|
|
|
|
|
Shareholders' equity |
|
|
2,414,294 |
|
|
|
|
|
|
|
2,184,810 |
|
|
|
|
|
Total liabilities and shareholders' equity |
|
$ |
23,270,467 |
|
|
|
|
|
|
$ |
20,619,646 |
|
|
|
|
|
Net interest spread |
|
|
|
|
|
|
2.72 |
% |
|
|
|
|
|
|
2.96 |
% |
Net interest margin |
|
|
|
|
|
|
3.19 |
|
|
|
|
|
|
|
3.24 |
|
Average Balances / Yields and Rates |
|
UMB Financial Corporation |
|
|||||||||||||
(tax - equivalent basis) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
|
|||||||||||||
|
|
2019 |
|
|
2018 |
|
||||||||||
|
|
Average |
|
|
Average |
|
|
Average |
|
|
Average |
|
||||
|
|
Balance |
|
|
Yield/Rate |
|
|
Balance |
|
|
Yield/Rate |
|
||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, net of unearned interest |
|
$ |
12,462,946 |
|
|
|
5.16 |
% |
|
$ |
11,365,921 |
|
|
|
4.64 |
% |
Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable |
|
|
4,402,458 |
|
|
|
2.39 |
|
|
|
3,865,660 |
|
|
|
2.10 |
|
Tax-exempt |
|
|
3,674,456 |
|
|
|
2.96 |
|
|
|
3,563,715 |
|
|
|
2.65 |
|
Total securities |
|
|
8,076,914 |
|
|
|
2.65 |
|
|
|
7,429,375 |
|
|
|
2.37 |
|
Federal funds and resell agreements |
|
|
424,712 |
|
|
|
2.92 |
|
|
|
134,009 |
|
|
|
2.69 |
|
Interest bearing due from banks |
|
|
554,551 |
|
|
|
2.42 |
|
|
|
341,469 |
|
|
|
1.56 |
|
Trading securities |
|
|
54,029 |
|
|
|
5.36 |
|
|
|
45,068 |
|
|
|
5.65 |
|
Total earning assets |
|
|
21,573,152 |
|
|
|
4.11 |
|
|
|
19,315,842 |
|
|
|
3.70 |
|
Allowance for loan losses |
|
|
(107,465 |
) |
|
|
|
|
|
|
(101,652 |
) |
|
|
|
|
Other assets |
|
|
1,597,444 |
|
|
|
|
|
|
|
1,468,793 |
|
|
|
|
|
Total assets |
|
$ |
23,063,131 |
|
|
|
|
|
|
$ |
20,682,983 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits |
|
$ |
12,729,813 |
|
|
|
1.23 |
% |
|
$ |
10,754,187 |
|
|
|
0.60 |
% |
Federal funds and repurchase agreements |
|
|
1,642,140 |
|
|
|
2.16 |
|
|
|
1,649,758 |
|
|
|
1.39 |
|
Borrowed funds |
|
|
82,077 |
|
|
|
6.70 |
|
|
|
78,773 |
|
|
|
6.22 |
|
Total interest-bearing liabilities |
|
|
14,454,030 |
|
|
|
1.36 |
|
|
|
12,482,718 |
|
|
|
0.74 |
|
Noninterest-bearing demand deposits |
|
|
6,028,259 |
|
|
|
|
|
|
|
5,857,618 |
|
|
|
|
|
Other liabilities |
|
|
255,405 |
|
|
|
|
|
|
|
170,374 |
|
|
|
|
|
Shareholders' equity |
|
|
2,325,437 |
|
|
|
|
|
|
|
2,172,273 |
|
|
|
|
|
Total liabilities and shareholders' equity |
|
$ |
23,063,131 |
|
|
|
|
|
|
$ |
20,682,983 |
|
|
|
|
|
Net interest spread |
|
|
|
|
|
|
2.75 |
% |
|
|
|
|
|
|
2.96 |
% |
Net interest margin |
|
|
|
|
|
|
3.19 |
|
|
|
|
|
|
|
3.22 |
|
Business Segment Information |
|
UMB Financial Corporation |
|
|||||||||||||||||
(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2019 |
|
|||||||||||||||||
|
|
Commercial
|
|
|
Institutional
|
|
|
Personal
|
|
|
Healthcare
|
|
|
Total |
|
|||||
Net interest income |
|
$ |
102,579 |
|
|
$ |
19,164 |
|
|
$ |
33,334 |
|
|
$ |
11,337 |
|
|
$ |
166,414 |
|
Provision for loan losses |
|
|
9,306 |
|
|
|
181 |
|
|
|
1,513 |
|
|
|
— |
|
|
|
11,000 |
|
Noninterest income |
|
|
20,387 |
|
|
|
46,777 |
|
|
|
29,385 |
|
|
|
8,849 |
|
|
|
105,398 |
|
Noninterest expense |
|
|
68,511 |
|
|
|
52,415 |
|
|
|
60,024 |
|
|
|
12,437 |
|
|
|
193,387 |
|
Income before taxes |
|
|
45,149 |
|
|
|
13,345 |
|
|
|
1,182 |
|
|
|
7,749 |
|
|
|
67,425 |
|
Income tax expense |
|
|
7,008 |
|
|
|
2,071 |
|
|
|
184 |
|
|
|
1,203 |
|
|
|
10,466 |
|
Income from continuing operations |
|
$ |
38,141 |
|
|
$ |
11,274 |
|
|
$ |
998 |
|
|
$ |
6,546 |
|
|
$ |
56,959 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2018 |
|
|||||||||||||||||
|
|
Commercial
|
|
|
Institutional
|
|
|
Personal
|
|
|
Healthcare
|
|
|
Total |
|
|||||
Net interest income |
|
$ |
93,145 |
|
|
$ |
16,226 |
|
|
$ |
31,043 |
|
|
$ |
9,812 |
|
|
$ |
150,226 |
|
Provision for loan losses |
|
|
5,139 |
|
|
|
322 |
|
|
|
1,539 |
|
|
|
— |
|
|
|
7,000 |
|
Noninterest income |
|
|
19,169 |
|
|
|
43,414 |
|
|
|
28,724 |
|
|
|
8,982 |
|
|
|
100,289 |
|
Noninterest expense |
|
|
62,850 |
|
|
|
47,554 |
|
|
|
54,263 |
|
|
|
12,551 |
|
|
|
177,218 |
|
Income before taxes |
|
|
44,325 |
|
|
|
11,764 |
|
|
|
3,965 |
|
|
|
6,243 |
|
|
|
66,297 |
|
Income tax expense |
|
|
7,269 |
|
|
|
1,929 |
|
|
|
650 |
|
|
|
1,025 |
|
|
|
10,873 |
|
Income from continuing operations |
|
$ |
37,056 |
|
|
$ |
9,835 |
|
|
$ |
3,315 |
|
|
$ |
5,218 |
|
|
$ |
55,424 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2019 |
|
|||||||||||||||||
|
|
Commercial
|
|
|
Institutional
|
|
|
Personal
|
|
|
Healthcare
|
|
|
Total |
|
|||||
Net interest income |
|
$ |
202,393 |
|
|
$ |
39,872 |
|
|
$ |
65,637 |
|
|
$ |
22,380 |
|
|
$ |
330,282 |
|
Provision for loan losses |
|
|
19,635 |
|
|
|
467 |
|
|
|
3,248 |
|
|
|
— |
|
|
|
23,350 |
|
Noninterest income |
|
|
43,568 |
|
|
|
92,564 |
|
|
|
57,736 |
|
|
|
18,912 |
|
|
|
212,780 |
|
Noninterest expense |
|
|
135,331 |
|
|
|
105,027 |
|
|
|
118,433 |
|
|
|
25,222 |
|
|
|
384,013 |
|
Income before taxes |
|
|
90,995 |
|
|
|
26,942 |
|
|
|
1,692 |
|
|
|
16,070 |
|
|
|
135,699 |
|
Income tax expense |
|
|
14,079 |
|
|
|
4,169 |
|
|
|
262 |
|
|
|
2,486 |
|
|
|
20,996 |
|
Income from continuing operations |
|
$ |
76,916 |
|
|
$ |
22,773 |
|
|
$ |
1,430 |
|
|
$ |
13,584 |
|
|
$ |
114,703 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2018 |
|
|||||||||||||||||
|
|
Commercial
|
|
|
Institutional
|
|
|
Personal
|
|
|
Healthcare
|
|
|
Total |
|
|||||
Net interest income |
|
$ |
185,061 |
|
|
$ |
31,990 |
|
|
$ |
61,988 |
|
|
$ |
19,109 |
|
|
$ |
298,148 |
|
Provision for loan losses |
|
|
13,117 |
|
|
|
672 |
|
|
|
3,211 |
|
|
|
— |
|
|
|
17,000 |
|
Noninterest income |
|
|
39,766 |
|
|
|
88,833 |
|
|
|
59,439 |
|
|
|
17,776 |
|
|
|
205,814 |
|
Noninterest expense |
|
|
124,975 |
|
|
|
94,433 |
|
|
|
109,317 |
|
|
|
24,369 |
|
|
|
353,094 |
|
Income before taxes |
|
|
86,735 |
|
|
|
25,718 |
|
|
|
8,899 |
|
|
|
12,516 |
|
|
|
133,868 |
|
Income tax expense |
|
|
13,549 |
|
|
|
4,017 |
|
|
|
1,390 |
|
|
|
1,955 |
|
|
|
20,911 |
|
Income from continuing operations |
|
$ |
73,186 |
|
|
$ |
21,701 |
|
|
$ |
7,509 |
|
|
$ |
10,561 |
|
|
$ |
112,957 |
|
The company has strategically aligned its operations into the following four reportable segments: Commercial Banking, Institutional Banking, Personal Banking, and Healthcare Services. Senior executive officers regularly evaluate business segment financial results produced by the company’s internal reporting system in deciding how to allocate resources and assess performance for individual business segments. The company’s reportable segments include certain corporate overhead, technology and service costs that are allocated based on methodologies that are applied consistently between periods. For comparability purposes, amounts in all periods are based on methodologies in effect at June 30, 2019.
Non-GAAP Financial Measures |
|
UMB Financial Corporation |
|
|||||||||||||
Net operating income Non-GAAP reconciliations: |
|
|
|
|||||||||||||
(unaudited, dollars in thousands except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
||||||||||
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||
Income from continuing operations (GAAP) |
|
$ |
56,959 |
|
|
$ |
55,424 |
|
|
$ |
114,703 |
|
|
$ |
112,957 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition and divestiture expense (income) |
|
|
70 |
|
|
|
(24 |
) |
|
|
97 |
|
|
|
(6 |
) |
Severance expense |
|
|
297 |
|
|
|
867 |
|
|
|
867 |
|
|
|
2,814 |
|
Tax-impact of adjustments (i) |
|
|
(81 |
) |
|
|
(188 |
) |
|
|
(214 |
) |
|
|
(624 |
) |
Total Non-GAAP adjustments (net of tax) |
|
|
286 |
|
|
|
655 |
|
|
|
750 |
|
|
|
2,184 |
|
Net operating income from continuing operations (Non-GAAP) |
|
$ |
57,245 |
|
|
$ |
56,079 |
|
|
$ |
115,453 |
|
|
$ |
115,141 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share from continuing operations - diluted (GAAP) |
|
$ |
1.16 |
|
|
$ |
1.11 |
|
|
$ |
2.34 |
|
|
$ |
2.26 |
|
Acquisition and divestiture expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Severance expense |
|
|
0.01 |
|
|
|
0.01 |
|
|
|
0.02 |
|
|
|
0.05 |
|
Tax-impact of adjustments (i) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.01 |
) |
Operating earnings per share from continuing operations - diluted (Non-GAAP) |
|
$ |
1.17 |
|
|
$ |
1.12 |
|
|
$ |
2.36 |
|
|
$ |
2.30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets |
|
|
0.98 |
% |
|
|
1.08 |
% |
|
|
1.00 |
% |
|
|
1.10 |
% |
Return on average equity |
|
|
9.46 |
|
|
|
10.18 |
|
|
|
9.95 |
|
|
|
10.49 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating return on average assets |
|
|
0.99 |
% |
|
|
1.09 |
% |
|
|
1.01 |
% |
|
|
1.12 |
% |
Operating return on average equity |
|
|
9.51 |
|
|
|
10.30 |
|
|
|
10.01 |
|
|
|
10.69 |
|
(i) Calculated using the company’s marginal tax rate of 22.2 percent. |
||||||||||||||||
Operating noninterest expense and operating efficiency ratio Non-GAAP reconciliations: |
|
UMB Financial Corporation |
|
|||||||||||||
(unaudited, dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
||||||||||
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||
Noninterest expense |
|
$ |
193,387 |
|
|
$ |
177,218 |
|
|
$ |
384,013 |
|
|
$ |
353,094 |
|
Adjustments to arrive at operating noninterest expense (pre-tax): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition and divestiture expense (income) |
|
|
70 |
|
|
|
(24 |
) |
|
|
97 |
|
|
|
(6 |
) |
Severance expense |
|
|
297 |
|
|
|
867 |
|
|
|
867 |
|
|
|
2,814 |
|
Total Non-GAAP adjustments (pre-tax) |
|
|
367 |
|
|
|
843 |
|
|
|
964 |
|
|
|
2,808 |
|
Operating noninterest expense (Non-GAAP) |
|
$ |
193,020 |
|
|
$ |
176,375 |
|
|
$ |
383,049 |
|
|
$ |
350,286 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest expense |
|
$ |
193,387 |
|
|
$ |
177,218 |
|
|
$ |
384,013 |
|
|
$ |
353,094 |
|
Less: Amortization of other intangibles |
|
|
1,251 |
|
|
|
1,485 |
|
|
|
2,578 |
|
|
|
3,047 |
|
Noninterest expense, net of amortization of other intangibles (Non-GAAP) (numerator A) |
|
$ |
192,136 |
|
|
$ |
175,733 |
|
|
$ |
381,435 |
|
|
$ |
350,047 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating noninterest expense |
|
$ |
193,020 |
|
|
$ |
176,375 |
|
|
$ |
383,049 |
|
|
$ |
350,286 |
|
Less: Amortization of other intangibles |
|
|
1,251 |
|
|
|
1,485 |
|
|
|
2,578 |
|
|
|
3,047 |
|
Operating expense, net of amortization of other intangibles (Non-GAAP) (numerator B) |
|
$ |
191,769 |
|
|
$ |
174,890 |
|
|
$ |
380,471 |
|
|
$ |
347,239 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ |
166,414 |
|
|
$ |
150,226 |
|
|
$ |
330,282 |
|
|
$ |
298,148 |
|
Noninterest income |
|
|
105,398 |
|
|
|
100,289 |
|
|
|
212,780 |
|
|
|
205,814 |
|
Less: (Losses) gains on sales of securities available for sale, net |
|
|
(1,403 |
) |
|
|
228 |
|
|
|
(594 |
) |
|
|
367 |
|
Total Non-GAAP Revenue (denominator A) |
|
$ |
273,215 |
|
|
$ |
250,287 |
|
|
$ |
543,656 |
|
|
$ |
503,595 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency ratio (numerator A/denominator A) |
|
|
70.32 |
% |
|
|
70.21 |
% |
|
|
70.16 |
% |
|
|
69.51 |
% |
Operating efficiency ratio (Non-GAAP) (numerator B/denominator A) |
|
|
70.19 |
|
|
|
69.88 |
|
|
|
69.98 |
|
|
|
68.95 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20190730005050/en/
Media Contact: Stephanie Hague: 816.860.5088
Investor Relations Contact: Kay Gregory: 816.860.7106
Source: UMB Financial Corporation