UMB Financial Corporation Reports Second Quarter Net Income of $101.3 Million and Net Operating Income(i) of $105.9 Million.

Second Quarter 2024 Financial Highlights

  • GAAP net income of $101.3 million, or $2.07 per diluted share.
  • Net operating income(i) of $105.9 million, or $2.16 per diluted share.
  • Average loans increased 7.7% on a linked-quarter, annualized basis, to $23.8 billion.
  • Average loans increased $1.6 billion, or 7.3%, as compared to the second quarter of 2023.
  • Average deposits increased 9.7% on a linked-quarter, annualized basis, to $34.3 billion.
  • Net interest margin was 2.51%, an increase of three basis points from the linked quarter.
  • Credit quality remained strong, with net charge-offs of just 0.05% of average loans in both the second quarter and the six months ended June 30, 2024.

UMB Financial Corporation (Nasdaq: UMBF), a financial services company, announced net income for the second quarter of 2024 of $101.3 million, or $2.07 per diluted share, compared to $110.3 million, or $2.25 per diluted share, in the first quarter (linked quarter) and $90.1 million, or $1.85 per diluted share, in the second quarter of 2023.

Net operating income, a non-GAAP financial measure reconciled later in this release to net income, the nearest comparable GAAP measure, was $105.9 million, or $2.16 per diluted share, for the second quarter of 2024, compared to $120.7 million, or $2.47 per diluted share, for the linked quarter and $93.8 million, or $1.93 per diluted share, for the second quarter of 2023. Operating pre-tax, pre-provision income (operating PTPP), a non-GAAP measure reconciled later in this release to the components of net income before taxes, the nearest comparable GAAP measure, was $146.8 million, or $3.00 per diluted share, for the second quarter of 2024, compared to $157.5 million, or $3.22 per diluted share, for the linked quarter, and $127.9 million, or $2.63 per diluted share, for the second quarter of 2023. These operating PTPP results represent a decrease of 6.7% on a linked-quarter basis and an increase of 14.8% compared to the second quarter of 2023.

“We are pleased with our second quarter financial results, including continued net interest income growth driven by balance sheet growth and net interest margin expansion, and solid credit metrics,” said Mariner Kemper, UMB Financial Corporation chairman and chief executive officer.

“In the second quarter, average loans increased 7.3% to $23.8 billion, and average deposits increased $2.9 billion or 9.1% from one year ago. Our borrowers remain cautiously optimistic, with some continuing concerns around the geopolitical environment, inflation, and the timing of potential rate cuts. Competition for good deals remains robust, however, our focus on relationships and service are our differentiators, allowing us to continue to take market share.

"Credit quality remains very strong, with net charge-offs just 0.05% of average loans for both the second quarter and year-to-date. Net charge-offs have averaged a mere four basis points over the past eight quarters. Non-performing loans fell to just 0.06% of loans for the second quarter.

"Our teams excel at building and maintaining strong relationships across our footprint, and we’re focused on continuing our long track record of growth. We remain excited about the future, including our pending acquisition of Heartland Financial and the opportunity we see as a combined company.”

(i) A non-GAAP financial measure reconciled later in this release to net income, the nearest comparable GAAP measure.

Second Quarter 2024 earnings discussion

Summary of quarterly financial results

 

UMB Financial Corporation

 

(unaudited, dollars in thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

Q2

 

 

Q1

 

 

Q2

 

 

 

2024

 

 

2024

 

 

2023

 

Net income (GAAP)

 

$

101,345

 

 

$

110,258

 

 

$

90,110

 

Earnings per share - diluted (GAAP)

2.07

2.25

1.85

 

Operating pre-tax, pre-provision income (Non-GAAP)(i)

 

 

146,840

 

 

 

157,451

 

 

 

127,929

 

Operating pre-tax, pre-provision earnings per share - diluted (Non-GAAP)(i)

3.00

3.22

2.63

 

 

 

 

 

 

 

 

 

Operating pre-tax, pre-provision income - FTE (Non-GAAP)(i)

 

 

153,247

 

 

 

163,967

 

 

 

134,504

 

Operating pre-tax, pre-provision earnings per share - FTE - diluted (Non-GAAP)(i)

3.13

3.35

2.77

 

 

 

 

 

 

 

 

 

 

Net operating income (Non-GAAP)(i)

 

 

105,873

 

 

 

120,712

 

 

 

93,841

 

Operating earnings per share - diluted (Non-GAAP)(i)

2.16

2.47

1.93

 

 

 

 

 

 

 

 

 

 

GAAP

 

 

 

 

 

 

 

 

 

Return on average assets

 

 

0.96

%

 

 

1.06

%

 

 

0.90

%

Return on average equity

 

 

12.73

 

 

 

14.11

 

 

 

12.56

 

Efficiency ratio

 

 

63.37

 

 

 

63.44

 

 

 

65.59

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP(i)

 

 

 

 

 

 

 

 

 

Operating return on average assets

 

 

1.00

%

 

 

1.16

%

 

 

0.93

%

Operating return on average equity

 

 

13.30

 

 

 

15.44

 

 

 

13.08

 

Operating efficiency ratio

 

 

61.86

 

 

 

60.04

 

 

 

64.24

 

(i)

 

See reconciliation of Non-GAAP measures to their nearest comparable GAAP measures later in this release.

Summary of year-to-date financial results

 

UMB Financial Corporation

 

(unaudited, dollars in thousands, except per share data)

 

June

 

 

June

 

 

 

YTD

 

 

YTD

 

 

 

2024

 

 

2023

 

Net income (GAAP)

 

$

211,603

 

 

$

182,547

 

Earnings per share - diluted (GAAP)

 

 

4.32

 

 

 

3.75

 

 

 

 

 

 

 

 

Operating pre-tax, pre-provision income (Non-GAAP)(i)

 

 

304,291

 

 

 

263,298

 

Operating pre-tax, pre-provision earnings per share - diluted (Non-GAAP)(i)

 

 

6.22

 

 

 

5.41

 

 

 

 

 

 

 

 

Operating pre-tax, pre-provision income - FTE (Non-GAAP)(i)

 

 

317,214

 

 

 

276,428

 

Operating pre-tax, pre-provision earnings per share - FTE - diluted (Non-GAAP)(i)

 

 

6.48

 

 

 

5.68

 

 

 

 

 

 

 

 

Net operating income (Non-GAAP)(i)

 

 

226,585

 

 

 

186,677

 

Operating earnings per share - diluted (Non-GAAP)(i)

 

 

4.63

 

 

 

3.83

 

 

 

 

 

 

 

 

GAAP

 

 

 

 

 

 

Return on average assets

 

 

1.01

%

 

 

0.93

%

Return on average equity

 

 

13.41

 

 

 

13.14

 

Efficiency ratio

 

 

63.41

 

 

 

64.34

 

 

 

 

 

 

 

 

Non-GAAP(i)

 

 

 

 

 

 

Operating return on average assets

 

 

1.08

%

 

 

0.95

%

Operating return on average equity

 

 

14.36

 

 

 

13.44

 

Operating efficiency ratio

 

 

60.94

 

 

 

63.61

 

Summary of revenue

 

UMB Financial Corporation

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Q2

 

Q1

 

Q2

 

CQ vs.

 

CQ vs.

 

 

2024

 

2024

 

2023

 

LQ

 

PY

Net interest income

 

$

245,108

 

 

$

239,434

 

 

$

225,611

 

 

$

5,674

 

 

$

19,497

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

Trust and securities processing

 

 

70,010

 

 

 

69,478

 

 

 

61,589

 

 

 

532

 

 

 

8,421

 

Trading and investment banking

 

 

5,461

 

 

 

5,462

 

 

 

4,800

 

 

 

(1

)

 

 

661

 

Service charges on deposit accounts

 

 

22,261

 

 

 

20,757

 

 

 

21,381

 

 

 

1,504

 

 

 

880

 

Insurance fees and commissions

 

 

267

 

 

 

283

 

 

 

225

 

 

 

(16

)

 

 

42

 

Brokerage fees

 

 

14,020

 

 

 

13,160

 

 

 

13,604

 

 

 

860

 

 

 

416

 

Bankcard fees

 

 

22,346

 

 

 

21,968

 

 

 

18,579

 

 

 

378

 

 

 

3,767

 

Investment securities (losses) gains, net

 

 

(1,867

)

 

 

9,371

 

 

 

900

 

 

 

(11,238

)

 

 

(2,767

)

Other

 

 

12,421

 

 

 

18,765

 

 

 

17,004

 

 

 

(6,344

)

 

 

(4,583

)

Total noninterest income

 

$

144,919

 

 

$

159,244

 

 

$

138,082

 

 

$

(14,325

)

 

$

6,837

 

Total revenue

 

$

390,027

 

 

$

398,678

 

 

$

363,693

 

 

$

(8,651

)

 

$

26,334

 

Net interest income (FTE)

 

$

251,515

 

 

$

245,950

 

 

$

232,186

 

 

 

 

 

Net interest margin (FTE)

 

 

2.51

%

 

 

2.48

%

 

 

2.44

%

 

 

 

 

Total noninterest income as a % of total revenue

 

 

37.2

 

 

 

39.9

 

 

 

38.0

 

 

 

 

 

Net interest income

  • Second quarter 2024 net interest income totaled $245.1 million, an increase of $5.7 million, or 2.4%, from the linked quarter, driven primarily by continued growth in average loans and higher levels of liquidity, partially offset by higher interest expense.
  • Average earning assets increased $359.7 million, or 0.9%, from the linked quarter, largely driven by an increase of $451.8 million in average loans and an increase of $182.8 million in interest-bearing due from banks, partially offset by a decrease of $314.6 million in average securities.
  • Average interest-bearing liabilities increased $375.9 million, or 1.3%, from the linked quarter, primarily driven by an increase of $778.0 million in interest-bearing deposits, partially offset by a decrease of $439.0 million in borrowed funds. Average noninterest-bearing demand deposits increased $36.6 million, or 0.4%, as compared to the linked quarter.
  • Net interest margin for the second quarter was 2.51%, an increase of three basis points from the linked quarter, driven by increased loan yields, the benefit of free funds, and earning asset mix changes, partially offset by the increased cost of interest-bearing liabilities. The cost of interest-bearing liabilities increased 12 basis points to 4.15%. Total cost of funds increased 10 basis points from the linked quarter to 3.06%. Both average loan yields and earning asset yields increased 13 basis points from the linked quarter.
  • On a year-over-year basis, net interest income increased $19.5 million, or 8.6%, driven by a $1.6 billion, or 7.3%, increase in average loans, partially offset by higher interest costs due to unfavorable mix shift in the composition of liabilities as well as the impact of higher short-term interest rates.
  • Compared to the second quarter of 2023, average earning assets increased $2.0 billion, or 5.2%, largely driven by the increase in average loans noted above and an increase of $779.2 million in interest-bearing due from banks, partially offset by a decrease of $360.3 million in average securities.
  • Average deposits increased 9.1% compared to the second quarter of 2023. Average noninterest-bearing demand deposit balances decreased 4.1% compared to the second quarter of 2023, driven by migration to rate-bearing deposit categories, as expected in a higher interest rate environment. Average demand deposit balances comprised 29.4% of total deposits, compared to 30.0% in the linked quarter and 33.5% in the second quarter of 2023.
  • Average borrowed funds decreased $439.0 million as compared to the linked quarter and $1.4 billion as compared to the second quarter of 2023, driven by short-term borrowings with the Federal Home Loan Bank and the Federal Reserve.

Noninterest income

  • Second quarter 2024 noninterest income decreased $14.3 million, or 9.0%, on a linked-quarter basis, largely due to:
    • $11.2 million in lower investment securities gains, primarily driven by a net $8.6 million gain on disposition of two of the company's non-marketable securities recognized in the first quarter and a $2.6 million reduction in value of one of the company's non-marketable securities during the second quarter.
    • A decrease of $5.8 million in other miscellaneous income, recorded in other income, related to a $4.0 million legal settlement and a $1.8 million gain on sale of land, both recorded during the first quarter of 2024.
    • These decreases were partially offset by an increase of $1.6 million in derivative income, recorded in other income, and an increase of $1.5 million in service charges on deposit accounts primarily due to higher healthcare income related to customer transfer and conversion.
  • Compared to the prior year, noninterest income in the second quarter of 2024 increased $6.8 million, or 5.0%, primarily driven by:
    • Increases of $5.6 million in fund services income, $1.5 million in corporate trust income, and $1.3 million in trust income, all recorded in trust and securities processing.
    • An increase of $3.8 million in bankcard income primarily driven by higher interchange revenue and lower rebates and rewards expense as compared to the prior year.
    • An increase of $1.0 million in healthcare income related to customer transfer and conversion, recorded in service charges on deposit accounts.
    • Increases of $0.5 million in bank-owned life insurance income and $0.5 million in derivative income, both recorded in other income.
    • These increases were partially offset by the following decreases:
      • A decrease of $4.3 million in other miscellaneous income driven by a $4.0 million gain on sale of other assets recorded in the second quarter of 2023.
      • $2.8 million in lower investment securities gains, primarily driven by a $2.6 million reduction in value of one of the company's non-marketable securities during the second quarter of 2024.

Noninterest expense

Summary of noninterest expense

 

UMB Financial Corporation

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q2

 

Q1

 

Q2

 

CQ vs.

 

CQ vs.

 

 

2024

 

2024

 

2023

 

LQ

 

PY

Salaries and employee benefits

 

$

142,861

 

 

$

143,006

 

 

$

143,312

 

 

$

(145

)

 

$

(451

)

Occupancy, net

 

 

11,723

 

 

 

12,270

 

 

 

11,746

 

 

 

(547

)

 

 

(23

)

Equipment

 

 

15,603

 

 

 

16,503

 

 

 

17,086

 

 

 

(900

)

 

 

(1,483

)

Supplies and services

 

 

3,404

 

 

 

3,301

 

 

 

4,195

 

 

 

103

 

 

 

(791

)

Marketing and business development

 

 

6,598

 

 

 

6,025

 

 

 

7,124

 

 

 

573

 

 

 

(526

)

Processing fees

 

 

29,701

 

 

 

27,936

 

 

 

26,572

 

 

 

1,765

 

 

 

3,129

 

Legal and consulting

 

 

16,566

 

 

 

7,894

 

 

 

7,059

 

 

 

8,672

 

 

 

9,507

 

Bankcard

 

 

11,818

 

 

 

10,567

 

 

 

8,307

 

 

 

1,251

 

 

 

3,511

 

Amortization of other intangible assets

 

 

1,911

 

 

 

1,960

 

 

 

2,117

 

 

 

(49

)

 

 

(206

)

Regulatory fees

 

 

2,568

 

 

 

19,395

 

 

 

6,123

 

 

 

(16,827

)

 

 

(3,555

)

Other

 

 

6,314

 

 

 

5,947

 

 

 

7,032

 

 

 

367

 

 

 

(718

)

Total noninterest expense

 

$

249,067

 

 

$

254,804

 

 

$

240,673

 

 

$

(5,737

)

 

$

8,394

 

  • GAAP noninterest expense for the second quarter of 2024 was $249.1 million, a decrease of $5.7 million, or 2.3%, from the linked quarter and an increase of $8.4 million, or 3.5% from the second quarter of 2023. Operating noninterest expense, a non-GAAP financial measure reconciled later in this release to noninterest expense, the nearest comparable GAAP measure, was $243.2 million for the second quarter of 2024, an increase of $2.0 million, or 0.8%, from the linked quarter and an increase of $7.4 million, or 3.1%, from the second quarter of 2023.
  • The linked-quarter decrease in GAAP noninterest expense was driven by:
    • A decrease of $16.8 million in regulatory fees expense, driven by the lower industry-wide FDIC special assessment levied on banks to recoup the losses related to two of the bank failures in March 2023. The results for the second quarter of 2024 include a reduction of $3.8 million in pre-tax FDIC special assessment expense while the first quarter included pre-tax expense of $13.0 million, both related to changes made in the loss estimates by the FDIC.
    • This decrease was partially offset by the following increases:
      • An increase of $8.7 million in legal and consulting expense driven by expense related to the announced acquisition of Heartland Financial USA, Inc.
      • An increase of $1.8 million in processing fees expense due to increased software subscription costs.
      • An increase of $1.3 million in bankcard expense driven by higher administrative expense.
  • The year-over-year increase in GAAP noninterest expense was driven by:
    • An increase of $9.5 million in legal and consulting expense, primarily driven by expense related to the announced acquisition of Heartland Financial USA, Inc.
    • An increase of $3.5 million in bankcard expense driven by higher administrative expense.
    • These increases were partially offset by a decrease of $3.6 million in regulatory fees expense driven by the aforementioned reduction of $3.8 million in FDIC special assessment expense recorded in the second quarter of 2024.

Income taxes

  • The company’s effective tax rate was 18.9% for the six months ended June 30, 2024, compared to 17.6% for the same period in 2023. The increase in the effective tax rate in 2024 is primarily attributable to a smaller portion of income being earned from tax-exempt municipal securities and a decrease in excess tax benefits associated with stock compensation recorded in 2024 as compared to the prior year.

Balance sheet

  • Average total assets for the second quarter of 2024 were $42.5 billion compared to $42.0 billion for the linked quarter and $40.4 billion for the same period in 2023.

Summary of average loans and leases - QTD Average

UMB Financial Corporation

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q2

 

 

Q1

 

 

Q2

 

 

CQ vs.

 

CQ vs.

 

 

2024

 

 

2024

 

 

2023

 

 

LQ

 

PY

Commercial and industrial

 

$

9,926,855

 

 

$

9,942,457

 

 

$

9,724,300

 

 

$

(15,602

)

 

$

202,555

 

Specialty lending

 

 

502,646

 

 

 

485,989

 

 

 

574,220

 

 

 

16,657

 

 

 

(71,574

)

Commercial real estate

 

 

9,360,991

 

 

 

9,026,511

 

 

 

8,178,463

 

 

 

334,480

 

 

 

1,182,528

 

Consumer real estate

 

 

2,998,560

 

 

 

2,968,320

 

 

 

2,833,739

 

 

 

30,240

 

 

 

164,821

 

Consumer

 

 

159,743

 

 

 

154,062

 

 

 

139,705

 

 

 

5,681

 

 

 

20,038

 

Credit cards

 

 

617,502

 

 

 

489,546

 

 

 

485,749

 

 

 

127,956

 

 

 

131,753

 

Leases and other

 

 

239,532

 

 

 

287,158

 

 

 

255,425

 

 

 

(47,626

)

 

 

(15,893

)

Total loans

 

$

23,805,829

 

 

$

23,354,043

 

 

$

22,191,601

 

 

$

451,786

 

 

$

1,614,228

 

  • Average loans for the second quarter of 2024 increased $451.8 million, or 1.9%, on a linked-quarter basis and $1.6 billion, or 7.3%, compared to the second quarter of 2023.

Summary of average securities - QTD Average

 

UMB Financial Corporation

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q2

 

 

Q1

 

 

Q2

 

 

CQ vs.

 

CQ vs.

 

 

2024

 

 

2024

 

 

2023

 

 

LQ

 

PY

Securities available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury

 

$

900,348

 

 

$

1,127,611

 

 

$

797,104

 

 

$

(227,263

)

 

$

103,244

 

U.S. Agencies

 

 

210,151

 

 

 

199,719

 

 

 

189,091

 

 

 

10,432

 

 

 

21,060

 

Mortgage-backed

 

 

3,667,289

 

 

 

3,595,619

 

 

 

3,813,234

 

 

 

71,670

 

 

 

(145,945

)

State and political subdivisions

 

 

1,213,000

 

 

 

1,254,148

 

 

 

1,319,398

 

 

 

(41,148

)

 

 

(106,398

)

Corporates

 

 

323,751

 

 

 

341,142

 

 

 

349,318

 

 

 

(17,391

)

 

 

(25,567

)

Collateralized loan obligations

 

 

336,273

 

 

 

347,063

 

 

 

348,078

 

 

 

(10,790

)

 

 

(11,805

)

Total securities available for sale

 

$

6,650,812

 

 

$

6,865,302

 

 

$

6,816,223

 

 

$

(214,490

)

 

$

(165,411

)

Securities held to maturity:

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Agencies

 

$

120,563

 

 

$

123,225

 

 

$

123,135

 

 

$

(2,662

)

 

$

(2,572

)

Mortgage-backed

 

 

2,656,096

 

 

 

2,707,780

 

 

 

2,878,657

 

 

 

(51,684

)

 

 

(222,561

)

State and political subdivisions

 

 

2,798,371

 

 

 

2,821,799

 

 

 

2,822,218

 

 

 

(23,428

)

 

 

(23,847

)

Total securities held to maturity

 

$

5,575,030

 

 

$

5,652,804

 

 

$

5,824,010

 

 

$

(77,774

)

 

$

(248,980

)

Trading securities

 

$

26,381

 

 

$

17,893

 

 

$

12,538

 

 

$

8,488

 

 

$

13,843

 

Other securities

 

 

448,015

 

 

 

478,805

 

 

 

407,754

 

 

 

(30,790

)

 

 

40,261

 

Total securities

 

$

12,700,238

 

 

$

13,014,804

 

 

$

13,060,525

 

 

$

(314,566

)

 

$

(360,287

)

  • Average total securities decreased 2.4% on a linked-quarter basis and 2.8% compared to the second quarter of 2023.
  • At June 30, 2024, the unrealized pre-tax net loss on the available-for-sale securities portfolio was $678.7 million, or 8.7% of the $7.8 billion amortized cost balance. At June 30, 2024, the unrealized pre-tax net loss on the securities designated as held to maturity was $636.2 million, or 11.5% of the $5.5 billion amortized cost value.

Summary of average deposits - QTD Average

UMB Financial Corporation

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q2

 

 

Q1

 

 

Q2

 

 

CQ vs.

 

CQ vs.

 

 

2024

 

 

2024

 

 

2023

 

 

LQ

 

PY

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand

 

$

10,103,035

 

 

$

10,066,409

 

 

$

10,535,325

 

 

$

36,626

 

 

$

(432,290

)

Interest-bearing demand and savings

 

 

21,914,116

 

 

 

20,701,659

 

 

 

17,463,022

 

 

 

1,212,457

 

 

 

4,451,094

 

Time deposits

 

 

2,323,610

 

 

 

2,758,064

 

 

 

3,476,616

 

 

 

(434,454

)

 

 

(1,153,006

)

Total deposits

 

$

34,340,761

 

 

$

33,526,132

 

 

$

31,474,963

 

 

$

814,629

 

 

$

2,865,798

 

Noninterest bearing deposits as % of total

 

 

29.4

%

 

 

30.0

%

 

 

33.5

%

 

 

 

 

  • Average deposits increased 2.4% on a linked-quarter basis and 9.1% compared to the second quarter of 2023.

Capital

Capital information

 

UMB Financial Corporation

 

(unaudited, dollars in thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

June 30, 2024

 

 

March 31, 2024

 

 

June 30, 2023

 

Total equity

 

$

3,227,347

 

 

$

3,152,816

 

 

$

2,831,628

 

Accumulated other comprehensive loss, net

 

 

(605,634

)

 

 

(594,538

)

 

 

(685,831

)

Book value per common share

 

 

66.21

 

 

 

64.68

 

 

 

58.36

 

Tangible book value per common share (Non-GAAP)(i)

 

 

60.58

 

 

 

59.01

 

 

 

52.54

 

 

 

 

 

 

 

 

 

 

 

Regulatory capital:

 

 

 

 

 

 

 

 

 

Common equity Tier 1 capital

 

$

3,591,755

 

 

$

3,503,837

 

 

$

3,273,841

 

Tier 1 capital

 

 

3,591,755

 

 

 

3,503,837

 

 

 

3,273,841

 

Total capital

 

 

4,214,712

 

 

 

4,115,097

 

 

 

3,870,101

 

 

 

 

 

 

 

 

 

 

 

Regulatory capital ratios:

 

 

 

 

 

 

 

 

 

Common equity Tier 1 capital ratio

 

 

11.14

%

 

 

11.09

%

 

 

10.65

%

Tier 1 risk-based capital ratio

 

 

11.14

 

 

 

11.09

 

 

 

10.65

 

Total risk-based capital ratio

 

 

13.08

 

 

 

13.03

 

 

 

12.59

 

Tier 1 leverage ratio

 

 

8.50

 

 

 

8.39

 

 

 

8.16

 

(i)

 

See reconciliation of Non-GAAP measures to their nearest comparable GAAP measures later in this release.

  • At June 30, 2024, 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

 

 

 

2024

 

 

2024

 

 

2023

 

 

2023

 

 

2023

 

Net charge-offs (recoveries) - total loans

 

$

2,856

 

 

$

3,017

 

 

$

1,352

 

 

$

4,618

 

 

$

(139

)

Net loan charge-offs (recoveries) as a % of total average loans

 

 

0.05

%

 

 

0.05

%

 

 

0.02

%

 

 

0.08

%

 

 

(0.00

)%

Loans over 90 days past due

 

$

5,644

 

 

$

3,076

 

 

$

3,111

 

 

$

3,044

 

 

$

10,675

 

Loans over 90 days past due as a % of total loans

 

 

0.02

%

 

 

0.01

%

 

 

0.01

%

 

 

0.01

%

 

 

0.05

%

Nonaccrual and restructured loans

 

$

13,743

 

 

$

17,756

 

 

$

13,212

 

 

$

17,042

 

 

$

19,347

 

Nonaccrual and restructured loans as a % of total loans

 

 

0.06

%

 

 

0.08

%

 

 

0.06

%

 

 

0.07

%

 

 

0.09

%

Provision for credit losses

 

$

14,050

 

 

$

10,000

 

 

$

 

 

$

4,977

 

 

$

13,000

 

  • Provision for credit losses for the second quarter increased $4.1 million from the linked quarter and $1.1 million from the second quarter of 2023. These changes are driven largely by ongoing re-calibrations of econometric loss models and underlying macro-economic drivers for certain loan portfolios and $0.6 billion increase in end-of-period loans from March 31, 2024, as well as general portfolio trends in the current period as compared to the prior periods.
  • Net charge-offs for the second quarter totaled $2.9 million, or 0.05% of average loans, compared to $3.0 million, or 0.05% of average loans in the linked quarter, and net recoveries of $0.1 million for the second quarter of 2023.

Dividend Declaration

At the company’s quarterly board meeting, the Board of Directors declared a $0.39 per share quarterly cash dividend, payable on October 1, 2024, to shareholders of record at the close of business on September 10, 2024.

Conference Call

The company will host a conference call to discuss its second quarter 2024 earnings results on Wednesday, July 31, 2024, at 8:30 a.m. (CT).

Interested parties may access the call by dialing (toll-free) 833-470-1428 or (international) 404-975-4839 and requesting to join the UMB Financial call with access code 944750. The live call may also be accessed by visiting investorrelations.umb.com or by using the following link:

UMB Financial 2Q 2024 Conference Call

A replay of the conference call may be heard through August 14, 2024, by calling (toll-free) 866-813-9403 or (international) 929-458-6194. The replay access code required for playback is 435652. 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, operating earnings per share – diluted (operating EPS), operating return on average equity (operating ROE), operating return on average assets (operating ROA), operating noninterest expense, operating efficiency ratio, operating pre-tax, pre-provision income (operating PTPP), operating pre-tax, pre-provision earnings per share – diluted (operating PTPP EPS), operating pre-tax, pre-provision income on a fully tax equivalent basis (operating PTPP-FTE), operating pre-tax, pre-provision FTE earnings per share – diluted (operating PTPP-FTE EPS), tangible shareholders’ equity, and tangible book value per share, 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, operating efficiency ratio, operating PTPP, operating PTPP EPS, operating PTPP-FTE, operating PTPP-FTE EPS, tangible shareholders’ equity, and tangible book value per share – 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- and severance-related items, and the FDIC special assessment 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, severance expense, the FDIC special assessment, 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, divided by the company’s average total shareholders’ equity for the relevant period. Operating ROA is calculated as net operating income, 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).

Operating PTPP income for the relevant period is defined as GAAP net interest income plus GAAP noninterest income, less noninterest expense, adjusted to reflect the impact of excluding expenses related to acquisitions and severance, and the FDIC special assessment.

Operating PTPP-FTE for the relevant period is defined as GAAP net interest income on a fully tax equivalent basis plus GAAP noninterest income, less noninterest expense, adjusted to reflect the impact of excluding expenses related to acquisitions and severance, and the FDIC special assessment.

Tangible shareholders’ equity for the relevant period is defined as GAAP shareholders’ equity, net of intangible assets. Tangible book value per share is defined as tangible shareholders’ equity divided by the Company’s total shares outstanding.

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, 2023, 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). In addition to such factors that have been disclosed previously: macroeconomic and adverse developments and uncertainties related to the collateral effects of the collapse of, and challenges for, domestic and international banks, including the impacts to the U.S. and global economies; sustained levels of high inflation and the potential for an economic recession on the heels of aggressive quantitative tightening by the Federal Reserve; and impacts related to or resulting from instability in the Middle East and Russia’s military action in Ukraine, such as the broader impacts to financial markets and the global macroeconomic and geopolitical environments, may also cause actual results or other future events, circumstances, or aspirations to differ from our forward-looking statements. 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, Missouri. UMB offers commercial banking, which includes comprehensive deposit, lending and investment services, personal banking, which includes wealth management and financial planning services, and institutional banking, which includes asset servicing, corporate trust solutions, investment banking, and healthcare services. UMB operates branches throughout Missouri, Illinois, Colorado, Kansas, Oklahoma, Nebraska, Arizona and Texas. As the company’s reach continues to grow, it also serves business clients nationwide and institutional clients in several countries. For more information, visit UMB.com, UMB Blog, UMB Facebook and UMB LinkedIn.

Consolidated Balance Sheets

 

UMB Financial Corporation

(unaudited, dollars in thousands)

 

 

 

 

 

 

June 30,

 

 

2024

 

2023

ASSETS

 

 

 

 

Loans

 

$

24,197,462

 

 

$

22,483,542

 

Allowance for credit losses on loans

 

 

(239,167

)

 

 

(222,161

)

Net loans

 

 

23,958,295

 

 

 

22,261,381

 

Loans held for sale

 

 

4,211

 

 

 

3,819

 

Securities:

 

 

 

 

Available for sale

 

 

7,107,373

 

 

 

6,668,615

 

Held to maturity, net of allowance for credit losses

 

 

5,546,634

 

 

 

5,807,763

 

Trading securities

 

 

28,981

 

 

 

28,887

 

Other securities

 

 

447,650

 

 

 

428,149

 

Total securities

 

 

13,130,638

 

 

 

12,933,414

 

Federal funds sold and resell agreements

 

 

247,462

 

 

 

319,838

 

Interest-bearing due from banks

 

 

4,640,418

 

 

 

3,369,911

 

Cash and due from banks

 

 

464,719

 

 

 

431,527

 

Premises and equipment, net

 

 

226,860

 

 

 

255,127

 

Accrued income

 

 

237,874

 

 

 

190,387

 

Goodwill

 

 

207,385

 

 

 

207,385

 

Other intangibles, net

 

 

67,141

 

 

 

75,184

 

Other assets

 

 

1,284,411

 

 

 

1,195,069

 

Total assets

 

$

44,469,414

 

 

$

41,243,042

 

 

 

 

 

 

LIABILITIES

 

 

 

 

Deposits:

 

 

 

 

Noninterest-bearing demand

 

$

12,034,606

 

 

$

12,142,906

 

Interest-bearing demand and savings

 

 

22,400,255

 

 

 

18,184,063

 

Time deposits under $250,000

 

 

1,421,513

 

 

 

2,665,166

 

Time deposits of $250,000 or more

 

 

661,196

 

 

 

528,326

 

Total deposits

 

 

36,517,570

 

 

 

33,520,461

 

Federal funds purchased and repurchase agreements

 

 

2,217,033

 

 

 

2,050,583

 

Short-term debt

 

 

1,300,000

 

 

 

1,800,000

 

Long-term debt

 

 

384,245

 

 

 

382,280

 

Accrued expenses and taxes

 

 

352,778

 

 

 

256,845

 

Other liabilities

 

 

470,441

 

 

 

401,245

 

Total liabilities

 

 

41,242,067

 

 

 

38,411,414

 

 

 

 

 

 

SHAREHOLDERS' EQUITY

 

 

 

 

Common stock

 

 

55,057

 

 

 

55,057

 

Capital surplus

 

 

1,132,301

 

 

 

1,124,977

 

Retained earnings

 

 

2,984,152

 

 

 

2,681,448

 

Accumulated other comprehensive loss, net

 

 

(605,634

)

 

 

(685,831

)

Treasury stock

 

 

(338,529

)

 

 

(344,023

)

Total shareholders' equity

 

 

3,227,347

 

 

 

2,831,628

 

Total liabilities and shareholders' equity

 

$

44,469,414

 

 

$

41,243,042

 

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,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

INTEREST INCOME

 

 

 

 

 

 

 

 

 

 

 

 

Loans

 

$

400,351

 

 

$

342,994

 

 

$

785,917

 

 

$

651,435

 

Securities:

 

 

 

 

 

 

 

 

 

 

 

 

Taxable interest

 

 

61,582

 

 

 

54,587

 

 

 

122,693

 

 

 

107,636

 

Tax-exempt interest

 

 

25,077

 

 

 

25,550

 

 

 

50,410

 

 

 

50,856

 

Total securities income

 

 

86,659

 

 

 

80,137

 

 

 

173,103

 

 

 

158,492

 

Federal funds and resell agreements

 

 

3,674

 

 

 

3,889

 

 

 

6,736

 

 

 

9,540

 

Interest-bearing due from banks

 

 

47,174

 

 

 

34,206

 

 

 

91,862

 

 

 

50,372

 

Trading securities

 

 

424

 

 

 

154

 

 

 

729

 

 

 

288

 

Total interest income

 

 

538,282

 

 

 

461,380

 

 

 

1,058,347

 

 

 

870,127

 

INTEREST EXPENSE

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

240,525

 

 

 

170,550

 

 

 

464,400

 

 

 

298,449

 

Federal funds and repurchase agreements

 

 

28,081

 

 

 

24,745

 

 

 

55,743

 

 

 

48,047

 

Other

 

 

24,568

 

 

 

40,474

 

 

 

53,662

 

 

 

56,324

 

Total interest expense

 

 

293,174

 

 

 

235,769

 

 

 

573,805

 

 

 

402,820

 

Net interest income

 

 

245,108

 

 

 

225,611

 

 

 

484,542

 

 

 

467,307

 

Provision for credit losses

 

 

14,050

 

 

 

13,000

 

 

 

24,050

 

 

 

36,250

 

Net interest income after provision for credit losses

 

 

231,058

 

 

 

212,611

 

 

 

460,492

 

 

 

431,057

 

NONINTEREST INCOME

 

 

 

 

 

 

 

 

 

 

 

 

Trust and securities processing

 

 

70,010

 

 

 

61,589

 

 

 

139,488

 

 

 

123,948

 

Trading and investment banking

 

 

5,461

 

 

 

4,800

 

 

 

10,923

 

 

 

10,108

 

Service charges on deposit accounts

 

 

22,261

 

 

 

21,381

 

 

 

43,018

 

 

 

42,540

 

Insurance fees and commissions

 

 

267

 

 

 

225

 

 

 

550

 

 

 

499

 

Brokerage fees

 

 

14,020

 

 

 

13,604

 

 

 

27,180

 

 

 

27,280

 

Bankcard fees

 

 

22,346

 

 

 

18,579

 

 

 

44,314

 

 

 

36,751

 

Investment securities (losses) gains, net

 

 

(1,867

)

 

 

900

 

 

 

7,504

 

 

 

(4,424

)

Other

 

 

12,421

 

 

 

17,004

 

 

 

31,186

 

 

 

31,580

 

Total noninterest income

 

 

144,919

 

 

 

138,082

 

 

 

304,163

 

 

 

268,282

 

NONINTEREST EXPENSE

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

142,861

 

 

 

143,312

 

 

 

285,867

 

 

 

285,810

 

Occupancy, net

 

 

11,723

 

 

 

11,746

 

 

 

23,993

 

 

 

23,923

 

Equipment

 

 

15,603

 

 

 

17,086

 

 

 

32,106

 

 

 

34,935

 

Supplies and services

 

 

3,404

 

 

 

4,195

 

 

 

6,705

 

 

 

8,070

 

Marketing and business development

 

 

6,598

 

 

 

7,124

 

 

 

12,623

 

 

 

12,459

 

Processing fees

 

 

29,701

 

 

 

26,572

 

 

 

57,637

 

 

 

49,812

 

Legal and consulting

 

 

16,566

 

 

 

7,059

 

 

 

24,460

 

 

 

14,344

 

Bankcard

 

 

11,818

 

 

 

8,307

 

 

 

22,385

 

 

 

15,440

 

Amortization of other intangible assets

 

 

1,911

 

 

 

2,117

 

 

 

3,871

 

 

 

4,415

 

Regulatory fees

 

 

2,568

 

 

 

6,123

 

 

 

21,963

 

 

 

11,674

 

Other

 

 

6,314

 

 

 

7,032

 

 

 

12,261

 

 

 

16,843

 

Total noninterest expense

 

 

249,067

 

 

 

240,673

 

 

 

503,871

 

 

 

477,725

 

Income before income taxes

 

 

126,910

 

 

 

110,020

 

 

 

260,784

 

 

 

221,614

 

Income tax expense

 

 

25,565

 

 

 

19,910

 

 

 

49,181

 

 

 

39,067

 

NET INCOME

 

$

101,345

 

 

$

90,110

 

 

$

211,603

 

 

$

182,547

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PER SHARE DATA

 

 

 

 

 

 

 

 

 

 

 

 

Net income – basic

 

$

2.08

 

 

$

1.86

 

 

$

4.34

 

 

$

3.77

 

Net income – diluted

 

 

2.07

 

 

 

1.85

 

 

 

4.32

 

 

 

3.75

 

Dividends

 

 

0.39

 

 

 

0.38

 

 

 

0.78

 

 

 

0.76

 

Weighted average shares outstanding – basic

 

 

48,744,636

 

 

 

48,514,277

 

 

 

48,704,075

 

 

 

48,474,865

 

Weighted average shares outstanding – diluted

 

 

48,974,265

 

 

 

48,668,413

 

 

 

48,952,054

 

 

 

48,707,487

 

Consolidated Statements of Comprehensive Income

 

UMB Financial Corporation

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

June 30,

 

 

2024

 

2023

 

2024

 

2023

Net income

 

$

101,345

 

 

$

90,110

 

 

$

211,603

 

 

$

182,547

 

Other comprehensive (loss) income, before tax:

 

 

 

 

 

 

 

 

Unrealized gains and losses on debt securities:

 

 

 

 

 

 

 

 

Change in unrealized holding gains and losses, net

 

 

(12,727

)

 

 

(87,505

)

 

 

(54,280

)

 

 

6,152

 

Less: Reclassification adjustment for net (gains) losses included in net income

 

 

 

 

 

 

 

 

(139

)

 

 

433

 

Amortization of net unrealized loss on securities transferred from available-for-sale to held-to-maturity

 

 

8,938

 

 

 

10,312

 

 

 

17,727

 

 

 

20,295

 

Change in unrealized gains and losses on debt securities

 

 

(3,789

)

 

 

(77,193

)

 

 

(36,692

)

 

 

26,880

 

Unrealized gains and losses on derivative hedges:

 

 

 

 

 

 

 

 

Change in unrealized gains and losses on derivative hedges, net

 

 

(8,775

)

 

 

1,848

 

 

 

(22,433

)

 

 

321

 

Less: Reclassification adjustment for net gains included in net income

 

 

(2,066

)

 

 

(2,660

)

 

 

(5,726

)

 

 

(5,221

)

Change in unrealized gains and losses on derivative hedges

 

 

(10,841

)

 

 

(812

)

 

 

(28,159

)

 

 

(4,900

)

Other comprehensive (loss) income, before tax

 

 

(14,630

)

 

 

(78,005

)

 

 

(64,851

)

 

 

21,980

 

Income tax benefit (expense)

 

 

3,534

 

 

 

18,950

 

 

 

16,152

 

 

 

(5,076

)

Other comprehensive (loss) income

 

 

(11,096

)

 

 

(59,055

)

 

 

(48,699

)

 

 

16,904

 

Comprehensive income

 

$

90,249

 

 

$

31,055

 

 

$

162,904

 

 

$

199,451

 

Consolidated Statements of Shareholders' Equity

UMB Financial Corporation

(unaudited, dollars in thousands except per share data)

 

 

 

 

 

 

 

 

 

 

 

Common

Stock

 

 

Capital

Surplus

 

Retained

Earnings

 

 

Accumulated

Other

Comprehensive

(Loss) Income

 

Treasury

Stock

 

Total

Balance - January 1, 2023

 

$

55,057

 

 

$

1,125,949

 

 

$

2,536,086

 

 

$

(702,735

)

 

$

(347,264

)

 

$

2,667,093

 

Total comprehensive income

 

 

 

 

 

 

 

 

182,547

 

 

 

16,904

 

 

 

 

 

 

199,451

 

Dividends ($0.76 per share)

 

 

 

 

 

 

 

 

(37,185

)

 

 

 

 

 

 

 

 

(37,185

)

Purchase of treasury stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(7,902

)

 

 

(7,902

)

Issuances of equity awards, net of forfeitures

 

 

 

 

 

(9,764

)

 

 

 

 

 

 

 

 

10,483

 

 

 

719

 

Recognition of equity-based compensation

 

 

 

 

 

8,455

 

 

 

 

 

 

 

 

 

 

 

 

8,455

 

Sale of treasury stock

 

 

 

 

 

115

 

 

 

 

 

 

 

 

 

140

 

 

 

255

 

Exercise of stock options

 

 

 

 

 

222

 

 

 

 

 

 

 

 

 

520

 

 

 

742

 

Balance - June 30, 2023

 

$

55,057

 

 

$

1,124,977

 

 

$

2,681,448

 

 

$

(685,831

)

 

$

(344,023

)

 

$

2,831,628

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - January 1, 2024

 

$

55,057

 

 

$

1,134,363

 

 

$

2,810,824

 

 

$

(556,935

)

 

$

(342,890

)

 

$

3,100,419

 

Total comprehensive income (loss)

 

 

 

 

 

 

 

 

211,603

 

 

 

(48,699

)

 

 

 

 

 

162,904

 

Dividends ($0.78 per share)

 

 

 

 

 

 

 

 

(38,275

)

 

 

 

 

 

 

 

 

(38,275

)

Purchase of treasury stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(7,537

)

 

 

(7,537

)

Issuances of equity awards, net of forfeitures

 

 

 

 

 

(10,964

)

 

 

 

 

 

 

 

 

11,667

 

 

 

703

 

Recognition of equity-based compensation

 

 

 

 

 

10,040

 

 

 

 

 

 

 

 

 

 

 

 

10,040

 

Sale of treasury stock

 

 

 

 

 

125

 

 

 

 

 

 

 

 

 

107

 

 

 

232

 

Exercise of stock options

 

 

 

 

 

54

 

 

 

 

 

 

 

 

 

124

 

 

 

178

 

Common stock issuance costs

 

 

 

 

 

(1,317

)

 

 

 

 

 

 

 

 

 

 

 

(1,317

)

Balance - June 30, 2024

 

$

55,057

 

 

$

1,132,301

 

 

$

2,984,152

 

 

$

(605,634

)

 

$

(338,529

)

 

$

3,227,347

 

Average Balances / Yields and Rates

 

UMB Financial Corporation

 

(tax - equivalent basis)

 

 

 

 

 

 

 

 

 

 

 

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

 

 

2024

 

 

2023

 

 

 

Average

 

 

Average

 

 

Average

 

 

Average

 

 

 

Balance

 

 

Yield/Rate

 

 

Balance

 

 

Yield/Rate

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Loans, net of unearned interest

 

$

23,805,829

 

 

 

6.77

%

 

$

22,191,601

 

 

 

6.20

%

Securities:

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

9,033,829

 

 

 

2.74

 

 

 

9,228,103

 

 

 

2.37

 

Tax-exempt

 

 

3,640,028

 

 

 

3.47

 

 

 

3,819,884

 

 

 

3.36

 

Total securities

 

 

12,673,857

 

 

 

2.95

 

 

 

13,047,987

 

 

 

2.66

 

Federal funds and resell agreements

 

 

246,132

 

 

 

6.00

 

 

 

276,459

 

 

 

5.64

 

Interest bearing due from banks

 

 

3,486,907

 

 

 

5.44

 

 

 

2,707,740

 

 

 

5.07

 

Trading securities

 

 

26,381

 

 

 

6.95

 

 

 

12,538

 

 

 

5.37

 

Total earning assets

 

 

40,239,106

 

 

 

5.44

 

 

 

38,236,325

 

 

 

4.91

 

Allowance for credit losses

 

 

(228,369

)

 

 

 

 

 

(216,876

)

 

 

 

Other assets

 

 

2,465,492

 

 

 

 

 

 

2,345,714

 

 

 

 

Total assets

 

$

42,476,229

 

 

 

 

 

$

40,365,163

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

$

24,237,726

 

 

 

3.99

%

 

$

20,939,638

 

 

 

3.27

%

Federal funds and repurchase agreements

 

 

2,421,727

 

 

 

4.66

 

 

 

2,336,929

 

 

 

4.25

 

Borrowed funds

 

 

1,744,448

 

 

 

5.66

 

 

 

3,137,267

 

 

 

5.17

 

Total interest-bearing liabilities

 

 

28,403,901

 

 

 

4.15

 

 

 

26,413,834

 

 

 

3.58

 

Noninterest-bearing demand deposits

 

 

10,103,035

 

 

 

 

 

 

10,535,325

 

 

 

 

Other liabilities

 

 

767,687

 

 

 

 

 

 

539,172

 

 

 

 

Shareholders' equity

 

 

3,201,606

 

 

 

 

 

 

2,876,832

 

 

 

 

Total liabilities and shareholders' equity

 

$

42,476,229

 

 

 

 

 

$

40,365,163

 

 

 

 

Net interest spread

 

 

 

 

 

1.29

%

 

 

 

 

 

1.33

%

Net interest margin

 

 

 

 

 

2.51

 

 

 

 

 

 

2.44

 

Average Balances / Yields and Rates

 

UMB Financial Corporation

 

(tax - equivalent basis)

 

 

 

 

 

 

 

 

 

 

 

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30,

 

 

 

2024

 

 

2023

 

 

 

Average

 

 

Average

 

 

Average

 

 

Average

 

 

 

Balance

 

 

Yield/Rate

 

 

Balance

 

 

Yield/Rate

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Loans, net of unearned interest

 

$

23,579,936

 

 

 

6.70

%

 

$

21,734,142

 

 

 

6.05

%

Securities:

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

9,149,309

 

 

 

2.70

 

 

 

9,288,392

 

 

 

2.34

 

Tax-exempt

 

 

3,686,075

 

 

 

3.44

 

 

 

3,832,505

 

 

 

3.36

 

Total securities

 

 

12,835,384

 

 

 

2.91

 

 

 

13,120,897

 

 

 

2.64

 

Federal funds and resell agreements

 

 

226,288

 

 

 

5.99

 

 

 

363,341

 

 

 

5.29

 

Interest bearing due from banks

 

 

3,395,466

 

 

 

5.44

 

 

 

2,127,343

 

 

 

4.77

 

Trading securities

 

 

22,137

 

 

 

7.10

 

 

 

10,907

 

 

 

5.77

 

Total earning assets

 

 

40,059,211

 

 

 

5.38

 

 

 

37,356,630

 

 

 

4.77

 

Allowance for credit losses

 

 

(225,243

)

 

 

 

 

 

(206,559

)

 

 

 

Other assets

 

 

2,411,681

 

 

 

 

 

 

2,292,479

 

 

 

 

Total assets

 

$

42,245,649

 

 

 

 

 

$

39,442,550

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

$

23,848,724

 

 

 

3.92

%

 

$

20,294,984

 

 

 

2.97

%

Federal funds and repurchase agreements

 

 

2,403,240

 

 

 

4.66

 

 

 

2,399,090

 

 

 

4.04

 

Borrowed funds

 

 

1,963,971

 

 

 

5.49

 

 

 

2,174,157

 

 

 

5.22

 

Total interest-bearing liabilities

 

 

28,215,935

 

 

 

4.09

 

 

 

24,868,231

 

 

 

3.27

 

Noninterest-bearing demand deposits

 

 

10,084,722

 

 

 

 

 

 

11,223,478

 

 

 

 

Other liabilities

 

 

772,430

 

 

 

 

 

 

549,787

 

 

 

 

Shareholders' equity

 

 

3,172,562

 

 

 

 

 

 

2,801,054

 

 

 

 

Total liabilities and shareholders' equity

 

$

42,245,649

 

 

 

 

 

$

39,442,550

 

 

 

 

Net interest spread

 

 

 

 

 

1.29

%

 

 

 

 

 

1.50

%

Net interest margin

 

 

 

 

 

2.50

 

 

 

 

 

 

2.59

 

Business Segment Information

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2024

 

 

 

Commercial

Banking

 

 

Institutional

Banking

 

 

Personal

Banking

 

Total

 

Net interest income

 

$

160,487

 

 

$

51,502

 

 

$

33,119

 

 

$

245,108

 

Provision for credit losses

 

 

11,480

 

 

 

846

 

 

 

1,724

 

 

 

14,050

 

Noninterest income

 

 

27,720

 

 

 

95,092

 

 

 

22,107

 

 

 

144,919

 

Noninterest expense

 

 

85,780

 

 

 

95,531

 

 

 

67,756

 

 

 

249,067

 

Income (loss) before taxes

 

 

90,947

 

 

 

50,217

 

 

 

(14,254

)

 

 

126,910

 

Income tax expense (benefit)

 

 

17,858

 

 

 

9,297

 

 

 

(1,590

)

 

 

25,565

 

Net income (loss)

 

$

73,089

 

 

$

40,920

 

 

$

(12,664

)

 

$

101,345

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2023

 

 

 

Commercial

Banking

 

 

Institutional

Banking

 

 

Personal

Banking

 

Total

 

Net interest income

 

$

144,389

 

 

$

50,397

 

 

 

30,825

 

 

$

225,611

 

Provision for credit losses

 

 

11,055

 

 

 

234

 

 

 

1,711

 

 

 

13,000

 

Noninterest income

 

 

25,666

 

 

 

86,813

 

 

 

25,603

 

 

 

138,082

 

Noninterest expense

 

 

85,896

 

 

 

91,591

 

 

 

63,186

 

 

 

240,673

 

Income (loss) before taxes

 

 

73,104

 

 

 

45,385

 

 

 

(8,469

)

 

 

110,020

 

Income tax expense (benefit)

 

 

12,996

 

 

 

8,011

 

 

 

(1,097

)

 

 

19,910

 

Net income (loss)

 

$

60,108

 

 

$

37,374

 

 

$

(7,372

)

 

$

90,110

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2024

 

 

 

Commercial

Banking

 

 

Institutional

Banking

 

 

Personal

Banking

 

Total

 

Net interest income

 

$

317,734

 

 

$

101,362

 

 

$

65,446

 

 

$

484,542

 

Provision for credit losses

 

 

19,000

 

 

 

1,325

 

 

 

3,725

 

 

 

24,050

 

Noninterest income

 

 

70,686

 

 

 

187,808

 

 

 

45,669

 

 

 

304,163

 

Noninterest expense

 

 

178,199

 

 

 

195,907

 

 

 

129,765

 

 

 

503,871

 

Income (loss) before taxes

 

 

191,221

 

 

 

91,938

 

 

 

(22,375

)

 

 

260,784

 

Income tax expense (benefit)

 

 

35,153

 

 

 

16,828

 

 

 

(2,800

)

 

 

49,181

 

Net income (loss)

 

$

156,068

 

 

$

75,110

 

 

$

(19,575

)

 

$

211,603

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2023

 

 

 

Commercial

Banking

 

 

Institutional

Banking

 

 

Personal

Banking

 

Total

 

Net interest income

 

$

295,416

 

 

$

105,482

 

 

$

66,409

 

 

$

467,307

 

Provision for credit losses

 

 

32,099

 

 

 

331

 

 

 

3,820

 

 

 

36,250

 

Noninterest income

 

 

48,568

 

 

 

171,051

 

 

 

48,663

 

 

 

268,282

 

Noninterest expense

 

 

169,900

 

 

 

180,962

 

 

 

126,863

 

 

 

477,725

 

Income (loss) before taxes

 

 

141,985

 

 

 

95,240

 

 

 

(15,611

)

 

 

221,614

 

Income tax expense (benefit)

 

 

24,638

 

 

 

16,523

 

 

 

(2,094

)

 

 

39,067

 

Net income (loss)

 

$

117,347

 

 

$

78,717

 

 

$

(13,517

)

 

$

182,547

 

The company has strategically aligned its operations into the following three reportable segments: Commercial Banking, Institutional Banking, and Personal Banking. 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, 2024.

Non-GAAP Financial Measures

Net operating income Non-GAAP reconciliations:

 

UMB Financial Corporation

(unaudited, dollars in thousands except per share data)

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2024

 

2023

 

2024

 

2023

Net income (GAAP)

 

$

101,345

 

 

$

90,110

 

 

$

211,603

 

 

$

182,547

 

Adjustments:

 

 

 

 

 

 

 

 

Acquisition expense

 

 

9,550

 

 

 

18

 

 

 

9,981

 

 

 

57

 

Severance expense

 

 

130

 

 

 

4,891

 

 

 

276

 

 

 

5,377

 

FDIC special assessment

 

 

(3,800

)

 

 

 

 

 

9,200

 

 

 

 

Tax-impact of adjustments (i)

 

 

(1,352

)

 

 

(1,178

)

 

 

(4,475

)

 

 

(1,304

)

Total Non-GAAP adjustments (net of tax)

 

 

4,528

 

 

 

3,731

 

 

 

14,982

 

 

 

4,130

 

Net operating income (Non-GAAP)

 

$

105,873

 

 

$

93,841

 

 

$

226,585

 

 

$

186,677

 

 

 

 

 

 

 

 

 

 

Earnings per share - diluted (GAAP)

 

$

2.07

 

 

$

1.85

 

 

$

4.32

 

 

$

3.75

 

Acquisition expense

 

 

0.19

 

 

 

 

 

 

0.20

 

 

 

 

Severance expense

 

 

0.01

 

 

 

0.10

 

 

 

0.01

 

 

 

0.11

 

FDIC special assessment

 

 

(0.08

)

 

 

 

 

 

0.19

 

 

 

 

Tax-impact of adjustments (i)

 

 

(0.03

)

 

 

(0.02

)

 

 

(0.09

)

 

 

(0.03

)

Operating earnings per share - diluted (Non-GAAP)

 

$

2.16

 

 

$

1.93

 

 

$

4.63

 

 

$

3.83

 

 

 

 

 

 

 

 

 

 

GAAP

 

 

 

 

 

 

 

 

Return on average assets

 

 

0.96

%

 

 

0.90

%

 

 

1.01

%

 

 

0.93

%

Return on average equity

 

 

12.73

 

 

 

12.56

 

 

 

13.41

 

 

 

13.14

 

 

 

 

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

 

 

Operating return on average assets

 

 

1.00

%

 

 

0.93

%

 

 

1.08

%

 

 

0.95

%

Operating return on average equity

 

 

13.30

 

 

 

13.08

 

 

 

14.36

 

 

 

13.44

 

(i)

 

Calculated using the company’s marginal tax rate of 23.0% for 2024 and 24.0% for 2023.

Operating noninterest expense and operating efficiency ratio Non-GAAP reconciliations:

 

UMB Financial Corporation

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

2024

 

2023

 

 

2024

 

 

2023

Noninterest expense

 

$

249,067

 

 

$

240,673

 

 

$

503,871

 

 

$

477,725

 

Adjustments to arrive at operating noninterest expense (pre-tax):

 

 

 

 

 

 

 

 

 

 

Acquisition expense

 

 

9,550

 

 

 

18

 

 

 

9,981

 

 

 

57

 

Severance expense

 

 

130

 

 

 

4,891

 

 

 

276

 

 

 

5,377

 

FDIC special assessment

 

 

(3,800

)

 

 

 

 

 

9,200

 

 

 

 

Total Non-GAAP adjustments (pre-tax)

 

 

5,880

 

 

 

4,909

 

 

 

19,457

 

 

 

5,434

 

Operating noninterest expense (Non-GAAP)

 

$

243,187

 

 

$

235,764

 

 

$

484,414

 

 

$

472,291

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense

 

$

249,067

 

 

$

240,673

 

 

$

503,871

 

 

$

477,725

 

Less: Amortization of other intangibles

 

 

1,911

 

 

 

2,117

 

 

 

3,871

 

 

 

4,415

 

Noninterest expense, net of amortization of other intangibles (Non-GAAP) (numerator A)

 

$

247,156

 

 

$

238,556

 

 

$

500,000

 

 

$

473,310

 

 

 

 

 

 

 

 

 

 

 

 

Operating noninterest expense

 

$

243,187

 

 

$

235,764

 

 

$

484,414

 

 

$

472,291

 

Less: Amortization of other intangibles

 

 

1,911

 

 

 

2,117

 

 

 

3,871

 

 

 

4,415

 

Operating expense, net of amortization of other intangibles (Non-GAAP) (numerator B)

 

$

241,276

 

 

$

233,647

 

 

$

480,543

 

 

$

467,876

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

245,108

 

 

$

225,611

 

 

$

484,542

 

 

$

467,307

 

Noninterest income

 

 

144,919

 

 

 

138,082

 

 

 

304,163

 

 

 

268,282

 

Less: Gains (losses) on sales of securities available for sale, net

 

 

 

 

 

 

 

 

139

 

 

 

(2

)

Total Non-GAAP Revenue (denominator A)

 

$

390,027

 

 

$

363,693

 

 

$

788,566

 

 

$

735,591

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency ratio (numerator A/denominator A)

 

 

63.37

%

 

 

65.59

%

 

 

63.41

%

 

 

64.34

%

Operating efficiency ratio (Non-GAAP) (numerator B/denominator A)

 

 

61.86

 

 

 

64.24

 

 

 

60.94

 

 

 

63.61

 

Operating pre-tax, pre-provision income non-GAAP reconciliations:

UMB Financial Corporation

 

(unaudited, dollars in thousands except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2024

 

2023

 

 

2024

 

 

2023

 

Net interest income (GAAP)

 

$

245,108

 

 

$

225,611

 

 

$

484,542

 

 

$

467,307

 

Noninterest income (GAAP)

 

 

144,919

 

 

 

138,082

 

 

 

304,163

 

 

 

268,282

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense (GAAP)

 

 

249,067

 

 

 

240,673

 

 

 

503,871

 

 

 

477,725

 

Adjustments to arrive at operating noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

Acquisition expense

 

 

9,550

 

 

 

18

 

 

 

9,981

 

 

 

57

 

Severance expense

 

 

130

 

 

 

4,891

 

 

 

276

 

 

 

5,377

 

FDIC special assessment

 

 

(3,800

)

 

 

 

 

 

9,200

 

 

 

 

Total Non-GAAP adjustments

 

 

5,880

 

 

 

4,909

 

 

 

19,457

 

 

 

5,434

 

Operating noninterest expense (Non-GAAP)

 

 

243,187

 

 

 

235,764

 

 

 

484,414

 

 

 

472,291

 

Operating pre-tax, pre-provision income (Non-GAAP)

 

$

146,840

 

 

$

127,929

 

 

$

304,291

 

 

$

263,298

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income earnings per share - diluted (GAAP)

 

$

5.00

 

 

$

4.64

 

 

$

9.90

 

 

$

9.60

 

Noninterest income (GAAP)

 

 

2.96

 

 

 

2.84

 

 

 

6.21

 

 

 

5.51

 

Noninterest expense (GAAP)

 

 

5.08

 

 

 

4.95

 

 

 

10.29

 

 

 

9.81

 

Acquisition expense

 

 

0.19

 

 

 

 

 

 

0.20

 

 

 

 

Severance expense

 

 

0.01

 

 

 

0.10

 

 

 

0.01

 

 

 

0.11

 

FDIC special assessment

 

 

(0.08

)

 

 

 

 

 

0.19

 

 

 

 

Operating pre-tax, pre-provision earnings per share - diluted (Non-GAAP)

 

$

3.00

 

 

$

2.63

 

 

$

6.22

 

 

$

5.41

 

Operating pre-tax, pre-provision income - FTE Non-GAAP reconciliations:

 

UMB Financial Corporation

 

(unaudited, dollars in thousands except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2024

 

2023

 

 

2024

 

 

2023

 

Net interest income (GAAP)

 

$

245,108

 

 

$

225,611

 

 

$

484,542

 

 

$

467,307

 

Adjustments to arrive at net interest income - FTE:

 

 

 

 

 

 

 

 

 

 

 

Tax equivalent interest

 

 

6,407

 

 

 

6,575

 

 

 

12,923

 

 

 

13,130

 

Net interest income - FTE (Non-GAAP)

 

 

251,515

 

 

 

232,186

 

 

 

497,465

 

 

 

480,437

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income (GAAP)

 

 

144,919

 

 

 

138,082

 

 

 

304,163

 

 

 

268,282

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense (GAAP)

 

 

249,067

 

 

 

240,673

 

 

 

503,871

 

 

 

477,725

 

Adjustments to arrive at operating noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

Acquisition expense

 

 

9,550

 

 

 

18

 

 

 

9,981

 

 

 

57

 

Severance expense

 

 

130

 

 

 

4,891

 

 

 

276

 

 

 

5,377

 

FDIC special assessment

 

 

(3,800

)

 

 

 

 

 

9,200

 

 

 

 

Total Non-GAAP adjustments

 

 

5,880

 

 

 

4,909

 

 

 

19,457

 

 

 

5,434

 

Operating noninterest expense (Non-GAAP)

 

 

243,187

 

 

 

235,764

 

 

 

484,414

 

 

 

472,291

 

Operating pre-tax, pre-provision income - FTE (Non-GAAP)

 

$

153,247

 

 

$

134,504

 

 

$

317,214

 

$

276,428

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income earnings per share - diluted (GAAP)

 

$

5.00

 

 

$

4.64

 

 

$

9.90

 

 

$

9.60

 

Tax equivalent interest

 

 

0.13

 

 

 

0.14

 

 

 

0.26

 

 

 

0.27

 

Net interest income - FTE (Non-GAAP)

 

 

5.13

 

 

 

4.78

 

 

 

10.16

 

 

 

9.87

 

Noninterest income (GAAP)

 

 

2.96

 

 

 

2.84

 

 

 

6.21

 

 

 

5.51

 

Noninterest expense (GAAP)

 

 

5.08

 

 

 

4.95

 

 

 

10.29

 

 

 

9.81

 

Acquisition expense

 

 

0.19

 

 

 

 

 

 

0.20

 

 

 

 

Severance expense

 

 

0.01

 

 

 

0.10

 

 

 

0.01

 

 

 

0.11

 

FDIC special assessment

 

 

(0.08

)

 

 

 

 

 

0.19

 

 

 

 

Operating pre-tax, pre-provision income - FTE earnings per share - diluted (Non-GAAP)

 

$

3.13

 

 

$

2.77

 

 

$

6.48

 

 

$

5.68

 

Tangible book value non-GAAP reconciliations:

UMB Financial Corporation

 

(unaudited, dollars in thousands except share and per share data)

 

 

 

 

 

 

 

 

As of June 30,

 

 

 

2024

 

 

2023

 

Total shareholders' equity (GAAP)

 

$

3,227,347

 

 

$

2,831,628

 

Less: Intangible assets

 

 

 

 

 

 

Goodwill

 

 

207,385

 

 

 

207,385

 

Other intangibles, net

 

 

67,141

 

 

 

75,184

 

Total intangibles, net

 

 

274,526

 

 

 

282,569

 

Total tangible shareholders' equity (Non-GAAP)

 

$

2,952,821

 

 

$

2,549,059

 

 

 

 

 

 

 

 

Total shares outstanding

 

 

48,745,090

 

 

 

48,517,750

 

 

 

 

 

 

 

 

Ratio of total shareholders' equity (book value) per share

 

$

66.21

 

 

$

58.36

 

Ratio of total tangible shareholders' equity (tangible book value) per share (Non-GAAP)

 

 

60.58

 

 

 

52.54

 

 

Contacts

Media Contact: Stephanie Hague: 816.729.1027

Investor Relations Contact: Kay Gregory: 816.860.7106

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