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Section 1: 8-K (UMBF YE 2018 EARNINGS RELEASE)

umbf-8k_20190129.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported):  1/29/2019

 

 

UMB FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

 

 

Commission File Number: 001-38481

 

MO

  

43-0903811

(State or other jurisdiction of

  

(IRS Employer

incorporation)

  

Identification No.)

 

1010 Grand Blvd., Kansas City, MO 64106

(Address of principal executive offices, including zip code)

 

(816) 860-7000

(Registrant’s telephone number, including area code)

 

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13c-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 

 


Item 2.02Results of Operations and Financial Condition

 

On January 29, 2019, UMB Financial Corporation (the “Company”) issued a press release announcing the financial results for the Company for the quarter and year ended December 31, 2018.  A copy of the press release is attached as Exhibit 99.1.

 

The information contained in Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1 hereto, is being furnished and shall not be deemed to be “filed” with the Securities and Exchange Commission (“SEC”) for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section and are not incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, whether made before or after the date hereof, except as shall be expressly set forth by specific reference to this Current Report on Form 8-K in such a filing.

 

Item 7.01    Regulation FD Disclosure

 

On January 29, 2019, the Company announced in the same press release that the Board of Directors of the Company (the “Board”) had declared a quarterly dividend of $0.30 per share that is payable on April 1, 2019 to shareholders of record of the Company on March 11, 2019.  This press release is attached as Exhibit 99.1, and the information is hereby incorporated herein by reference.

 

The Company is furnishing a copy of materials that will be used in the Company’s shareholder conference call on January 30, 2019 at 8:30 a.m. (CT).  A copy of the materials is attached as Exhibit 99.2 and will also be available on the Company’s website at www.umb.com.  The materials are dated January 29, 2019, and the Company disclaims any obligation to correct or update any of the materials in the future, except as required by applicable securities laws.

 

The information provided under Item 7.01 of this Current Report on Form 8-K, including Exhibits 99.1 and 99.2 hereto, is being furnished and is not deemed to be “filed” with the SEC for the purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section and are not incorporated by reference into any filing of the Company under the Securities Act or the Exchange Act, whether made before or after the date hereof, except as shall be expressly set forth by specific reference to this Current Report on Form 8-K in such a filing.

                                       

Item 9.01    Financial Statements and Exhibits

 

99.1

Press Release announcing financial results for quarter and year ended December 31, 2018, and announcing dividend declaration.

99.2

Investor Presentation Materials, dated January 29, 2019.

 

 


SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

UMB FINANCIAL CORPORATION

 

 

By:

 

 

/s/ Ram Shankar

 

Ram Shankar

Chief Financial Officer

Date: January 29, 2019

 

 

 

(Back To Top)

Section 2: EX-99.1 (EX-99.1)

umbf-ex991_6.htm

Exhibit 99.1

  

UMB Financial Corporation                                                      News Release

1010 Grand Boulevard

Kansas City, MO 64106

816.860.7000

umb.com

 

//FOR IMMEDIATE RELEASE//

Media Contact: Stephanie Hague: 816.860.5088

Investor Relations Contact: Kay Gregory: 816.860.7106

 

UMB Financial Corporation Reports Earnings of $196.3 Million for the Full-Year 2018

 

KANSAS CITY, Mo. (January 29, 2019) – UMB Financial Corporation (Nasdaq: UMBF), a financial services company, announced results for the fourth quarter and year ended December 31, 2018.  

 

“Results for the fourth quarter 2018 included 8.5 percent annualized average loan growth, 9.9 percent deposit growth and margin expansion of six basis points on a linked-quarter basis,” said Mariner Kemper, chairman and chief executive officer. “However, our results for the quarter were significantly impacted by the charge off of a single $48.1 million factoring relationship. Strong asset quality has long been a hallmark of UMB and this event is certainly not typical for us. After a thorough review, we believe that the issues specific to this credit were isolated and that this charge-off does not point to deterioration in any particular sector. We will continue to evaluate our internal controls.”

 

Income from continuing operations for the fourth quarter 2018 was $25.5 million, or $0.52 per diluted share, compared to $57.8 million, or $1.16 per diluted share, in the third quarter 2018 (linked quarter) and $47.4 million, or $0.95 per diluted share, in the fourth quarter 2017. The reported GAAP income from continuing operations represents decreases of 56.0 percent on a linked-quarter basis and 46.3 percent compared to the fourth quarter 2017. For the year ended December 31, 2018, income from continuing operations was $196.3, million or $3.94 per diluted share, which is an increase of 7.3 percent compared to $183.0 million, or $3.67 per diluted share, for the year ended December 31, 2017.

 

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 $27.6 million, or $0.56 per diluted share, for the fourth quarter 2018, compared to $58.0 million, or $1.16 per diluted share, for the linked quarter and $47.5 million, or $0.95 per diluted share, for the fourth quarter 2017. These results represent decreases of 52.5 percent on a linked-quarter basis and 42.0 percent compared to the fourth quarter 2017. For the year ended December 31, 2018, net operating income from continuing operations was $200.7 million, or $4.03 per diluted share, compared to $183.7 million, or $3.69 per diluted share, for the year ended December 31, 2017.

 


Summary of quarterly financial results

 

UMB Financial Corporation

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q4

 

 

Q3

 

 

Q4

 

 

 

2018

 

 

2018

 

 

2017

 

Income from continuing operations

 

$

25,454

 

 

$

57,849

 

 

$

47,357

 

Income from discontinued operations

 

 

 

 

 

 

 

 

64,604

 

Net income

 

 

25,454

 

 

 

57,849

 

 

 

111,961

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share from continuing operations (diluted)

 

 

0.52

 

 

 

1.16

 

 

 

0.95

 

Earnings per share from discontinued operations (diluted)

 

 

 

 

 

 

 

 

1.30

 

Earnings per share (diluted)

 

 

0.52

 

 

 

1.16

 

 

 

2.25

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net operating income from continuing operations

 

 

27,578

 

 

 

58,024

 

 

 

47,533

 

Operating earnings per share from continuing operations (diluted)

 

 

0.56

 

 

 

1.16

 

 

 

0.95

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP - continuing operations

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets

 

 

0.46

%

 

 

1.11

%

 

 

0.91

%

Return on average equity

 

 

4.57

 

 

 

10.32

 

 

 

8.72

 

Efficiency ratio

 

 

71.26

 

 

 

71.27

 

 

 

71.70

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP - continuing operations

 

 

 

 

 

 

 

 

 

 

 

 

Operating return on average assets

 

 

0.50

%

 

 

1.11

%

 

 

0.91

%

Operating return on average equity

 

 

4.95

 

 

 

10.35

 

 

 

8.75

 

Operating efficiency ratio

 

 

70.19

 

 

 

71.18

 

 

 

71.59

 

 

Summary of year-to-date financial results

 

UMB Financial Corporation

 

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

 

December

 

 

December

 

 

 

YTD

 

 

YTD

 

 

 

2018

 

 

2017

 

Income from continuing operations

 

$

196,260

 

 

$

182,976

 

(Loss) income from discontinued operations

 

 

(747

)

 

 

64,129

 

Net income

 

 

195,513

 

 

 

247,105

 

 

 

 

 

 

 

 

 

 

Earnings per share from continuing operations (diluted)

 

 

3.94

 

 

 

3.67

 

(Losses) earnings per share from discontinued operations (diluted)

 

 

(0.01

)

 

 

1.29

 

Earnings per share (diluted)

 

 

3.93

 

 

 

4.96

 

 

 

 

 

 

 

 

 

 

Net operating income from continuing operations

 

 

200,743

 

 

 

183,688

 

Operating earnings per share from continuing operations (diluted)

 

 

4.03

 

 

 

3.69

 

 

 

 

 

 

 

 

 

 

GAAP - continuing operations

 

 

 

 

 

 

 

 

Return on average assets

 

 

0.93

%

 

 

0.90

%

Return on average equity

 

 

8.94

 

 

 

8.79

 

Efficiency ratio

 

 

70.39

 

 

 

71.33

 

 

 

 

 

 

 

 

 

 

Non-GAAP - continuing operations

 

 

 

 

 

 

 

 

Operating return on average assets

 

 

0.96

%

 

 

0.90

%

Operating return on average equity

 

 

9.15

 

 

 

8.83

 

Operating efficiency ratio

 

 

69.82

 

 

 

71.22

 

 

 

 

 

 

 

 


Discussion of results from continuing operations

 

Summary of revenue

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q4

 

 

Q3

 

 

Q4

 

 

CQ vs.

 

 

CQ vs.

 

 

 

2018

 

 

2018

 

 

2017

 

 

LQ

 

 

PY

 

Net interest income

 

$

161,808

 

 

$

150,490

 

 

$

146,346

 

 

$

11,318

 

 

$

15,462

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trust and securities processing

 

 

41,891

 

 

 

43,425

 

 

 

44,234

 

 

 

(1,534

)

 

 

(2,343

)

Trading and investment banking

 

 

3,119

 

 

 

3,711

 

 

 

5,015

 

 

 

(592

)

 

 

(1,896

)

Service charges on deposit accounts

 

 

20,733

 

 

 

20,927

 

 

 

21,364

 

 

 

(194

)

 

 

(631

)

Insurance fees and commissions

 

 

312

 

 

 

339

 

 

 

388

 

 

 

(27

)

 

 

(76

)

Brokerage fees

 

 

6,761

 

 

 

6,402

 

 

 

6,127

 

 

 

359

 

 

 

634

 

Bankcard fees

 

 

16,375

 

 

 

16,838

 

 

 

17,617

 

 

 

(463

)

 

 

(1,242

)

Gains on sales of securities available for sale, net

 

 

 

 

 

211

 

 

 

54

 

 

 

(211

)

 

 

(54

)

Other

 

 

5,808

 

 

 

9,032

 

 

 

11,234

 

 

 

(3,224

)

 

 

(5,426

)

        Total noninterest income

 

$

94,999

 

 

$

100,885

 

 

$

106,033

 

 

$

(5,886

)

 

$

(11,034

)

Total revenue

 

$

256,807

 

 

$

251,375

 

 

$

252,379

 

 

$

5,432

 

 

$

4,428

 

Net interest margin

 

 

3.24

%

 

 

3.18

%

 

 

3.21

%

 

 

 

 

 

 

 

 

Total noninterest income as a % of total revenue

 

 

36.99

 

 

 

40.13

 

 

 

42.01

 

 

 

 

 

 

 

 

 

 

Following the enactment of the Tax Cuts and Jobs Act, beginning in the first quarter of 2018, net interest margin is computed using net interest income adjusted to a fully taxable equivalent (FTE) basis assuming a statutory federal income tax rate of 21 percent and, where applicable, state income taxes; prior period net interest margins are computed using the then-statutory federal income tax rate of 35 percent and, where applicable, state income taxes.

 

Net interest income

 

Net interest income totaled $161.8 million, an increase of $11.3 million, or 7.5 percent, from linked quarter levels, impacted by a $249.4 million, or 2.1 percent, increase in average loans, as well as a six-basis-point improvement in net interest margin.

 

Earning asset yields improved 14 basis points from the linked quarter, primarily due to improved loan yields of 24 basis points to 5.11 percent, in part driven by favorable re-pricing from recent increases in short-term interest rates. The cost of interest-bearing liabilities increased 14 basis points to 1.21 percent, driven by a 19-basis point increase in cost of interest-bearing deposits. Total cost of deposits, including noninterest-bearing deposits, was 75 basis points, an increase of 13 basis points from the linked quarter.

 

On a year-over-year basis, the increase in net interest income was driven by an 8.0 percent, or $883.2 million, increase in average loans, as well as higher average loan yields, which increased 71 basis points from 2017, primarily driven by higher short-term interest rates, volume, and asset mix changes.

 

For the fourth quarter 2018, average earning assets stood at $20.5 billion, an increase of 5.8 percent over the fourth quarter 2017.

Noninterest income

 

Fourth quarter 2018 noninterest income decreased $5.9 million, or 5.8 percent, on a linked quarter basis, largely due to:

 

o

Decreases of $5.7 million and $1.3 million in company-owned life insurance income and derivative income, respectively, both of which are recorded in other income. These decreases were partially offset by $2.9 million in gains on sales of assets and $0.9 million in loss recoveries.  

 

o

A decrease in trust and securities processing due to a $1.5 million decline in alternative investment revenue.


 

o

A $0.6 million decrease in trading and investment banking due to decreased bond trading income.

 

 

Compared to prior year, noninterest income in the fourth quarter of 2018 decreased $11.0 million, or 10.4 percent, primarily driven by:

 

o

Decreases of $6.6 million and $0.9 million in company-owned life insurance and derivative income, respectively, both of which are recorded in other income. These decreases were partially offset by $2.9 million in gains on sales of assets.  

 

o

A $3.5 million decline in fund servicing revenue due to customer repricing and losses, which was partially offset by an increase of $1.4 million in corporate trust income, both recorded in trust and securities processing.

 

o

A $1.9 million decrease in trading and investment banking income due to decreased trading volume.

 

o

A $1.7 million increase in rewards and rebates expense recorded as an offset to bankcard fees driven by increased purchase volume, partially offset by a $0.4 million increase in interchange income.

 

o

A $0.6 million decrease in service charges on deposits primarily due to customer repricing.

Noninterest expense

 

Summary of noninterest expense

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q4

 

 

Q3

 

 

Q4

 

 

CQ vs.

 

 

CQ vs.

 

 

 

2018

 

 

2018

 

 

2017

 

 

LQ

 

 

PY

 

Salaries and employee benefits

 

$

103,992

 

 

$

102,956

 

 

$

107,656

 

 

$

1,036

 

 

$

(3,664

)

Occupancy, net

 

 

11,845

 

 

 

11,628

 

 

 

11,148

 

 

 

217

 

 

 

697

 

Equipment

 

 

18,983

 

 

 

18,533

 

 

 

18,690

 

 

 

450

 

 

 

293

 

Supplies and services

 

 

3,669

 

 

 

4,528

 

 

 

4,211

 

 

 

(859

)

 

 

(542

)

Marketing and business development

 

 

6,483

 

 

 

6,671

 

 

 

6,540

 

 

 

(188

)

 

 

(57

)

Processing fees

 

 

11,948

 

 

 

12,331

 

 

 

11,238

 

 

 

(383

)

 

 

710

 

Legal and consulting

 

 

11,085

 

 

 

8,470

 

 

 

6,045

 

 

 

2,615

 

 

 

5,040

 

Bankcard

 

 

4,316

 

 

 

4,407

 

 

 

4,405

 

 

 

(91

)

 

 

(89

)

Amortization of other intangible assets

 

 

1,332

 

 

 

1,385

 

 

 

1,641

 

 

 

(53

)

 

 

(309

)

Regulatory fees

 

 

2,681

 

 

 

3,337

 

 

 

3,825

 

 

 

(656

)

 

 

(1,144

)

Other

 

 

7,987

 

 

 

6,139

 

 

 

7,160

 

 

 

1,848

 

 

 

827

 

        Total noninterest expense

 

$

184,321

 

 

$

180,385

 

 

$

182,559

 

 

$

3,936

 

 

$

1,762

 

 

 

GAAP noninterest expense for the fourth quarter of 2018 was $184.3 million, an increase of $3.9 million, or 2.2 percent, from the linked quarter and an increase of $1.8 million, or 1.0 percent, from the fourth quarter of 2017.

 

On a non-GAAP basis, operating noninterest expense (as reconciled later in this release) was $181.6 million for the fourth quarter 2018, an increase of $1.4 million, or 0.8 percent, compared to the linked quarter, and a decrease of $0.7 million, or 0.4 percent, compared to the fourth quarter 2017.

 

The linked quarter increase in noninterest expense was driven by:

 

o

A $1.8 million increase in other noninterest expense, largely driven by a $0.9 million contribution made to the UMB Financial Corporation Charitable Foundation and an increase of $0.7 million in derivative expense.

 

o

A $1.7 million increase in consulting expense incurred in conjunction with the company’s ongoing investments in digital channel and integrated platform solutions to support business growth and the continued modernization of its core systems.


 

o

A $1.0 million increase in salaries and employee benefits, largely due to increased severance during the fourth quarter of 2018 and increased salary and wage expense driven by one additional business day in the fourth quarter compared to the third quarter. These increases were offset by a decrease in deferred compensation expense.  

 

The year-over-year increase in noninterest expense was driven by:

 

o

A $5.0 million increase in legal and consulting expense due to investments in digital channel and integrated platform solutions to support business growth and the continued ongoing modernization of the company’s core systems.

 

o

An increase of $0.7 million in derivative expense recorded in other noninterest expense.

 

o

These increases were partially offset by a decrease of $3.7 million in salaries and employee benefits, largely due to decreased deferred compensation expense and bonus expense.

Full year 2018 financial discussion

 

 

The 9.2 percent year-over-year increase in net interest income was driven by benefits from higher short-term interest rates, favorable pricing and increased loan balances. In 2018, average loan balances increased $762.9 million and average loan yields increased 57 basis points. Average interest-bearing liabilities increased $620.4 million, while the cost of interest-bearing liabilities increased 47 basis points.

 

Full-year noninterest income decreased $21.9 million, or 5.2 percent, due to:

 

o

An $8.1 million increase in rewards and rebates expense recorded as an offset to bankcard fees driven by increased purchase volume, partially offset by a $4.8 million increase in interchange income.

 

o

A $7.6 million decrease in trading and investment banking due to decreased bond trading income and due to market adjustments from the company’s seed investments in certain Scout funds following the liquidation of such investments in 2017.

 

o

A $7.5 million decrease in fund servicing revenue and a $1.0 million decrease in wealth management revenue, partially offset by a $4.0 million increase in corporate trust revenue, all recorded in trust and securities processing.

 

o

A $3.6 million decrease in gains on sales of available-for-sale securities.

 

o

A $3.4 million decrease in service charges on deposits, primarily due to repricing.

 

o

These decreases were partially offset by an increase of $2.6 million in brokerage fees, primarily driven by higher 12b-1 income.

 

Full-year noninterest expense increased $12.7 million, or 1.8 percent, primarily due to:

 

o

A $5.3 million increase in salary and employee benefit expense driven by increased bonus and sales commission expense and one additional business day in 2018 as compared to 2017, partially offset by a decrease in deferred compensation expense.  

 

o

A $6.5 million increase in legal and consulting expense and a $4.6 million increase in processing fees expense due to investments in digital channel and integrated platform solutions to support business growth and the continued ongoing modernization of the company’s core systems.

 

o

These increases were partially offset by a decrease of $3.1 million in other noninterest expense due to lower operational losses during 2018 as compared to 2017.

 

On a non-GAAP basis, operating noninterest expense, which excludes the impact of acquisition expenses and other items as reconciled later in this release, was $712.0 million for full-year 2018, an increase of $8.0 million, or 1.1 percent, compared to the full-year 2017.

 

 


Income taxes

 

The company’s effective tax rate was 12.2 percent for the year ended December 31, 2018, compared to 22.6 percent for the same period in 2017. The decrease is primarily a result of the Tax Cuts and Jobs Act, which lowered the federal corporate income tax rate to 21 percent from 35 percent, effective January 1, 2018. The decrease is also attributable to a discrete tax benefit of $5.1 million related to provision-to-return adjustments.

 

Balance sheet

 

Average total assets for the fourth quarter 2018 were $21.9 billion compared to $20.7 billion for both the linked quarter and the same period in 2017.

Summary of average loans and leases - QTD Average

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q4

 

 

Q3

 

 

Q4

 

 

CQ vs.

 

 

CQ vs.

 

 

 

2018

 

 

2018

 

 

2017

 

 

LQ

 

 

PY

 

Commercial

 

$

4,977,907

 

 

$

4,717,530

 

 

$

4,438,241

 

 

$

260,377

 

 

$

539,666

 

Asset-based loans

 

 

381,477

 

 

 

382,672

 

 

 

326,845

 

 

 

(1,195

)

 

 

54,632

 

Factoring loans

 

 

300,265

 

 

 

264,414

 

 

 

212,123

 

 

 

35,851

 

 

 

88,142

 

Commercial credit card

 

 

178,772

 

 

 

199,730

 

 

 

172,193

 

 

 

(20,958

)

 

 

6,579

 

Real estate - construction

 

 

826,310

 

 

 

814,053

 

 

 

835,715

 

 

 

12,257

 

 

 

(9,405

)

Real estate - commercial

 

 

3,663,610

 

 

 

3,701,072

 

 

 

3,394,232

 

 

 

(37,462

)

 

 

269,378

 

Real estate - residential

 

 

697,927

 

 

 

688,097

 

 

 

619,985

 

 

 

9,830

 

 

 

77,942

 

Real estate - HELOC

 

 

555,161

 

 

 

566,460

 

 

 

649,268

 

 

 

(11,299

)

 

 

(94,107

)

Consumer credit card

 

 

248,309

 

 

 

222,223

 

 

 

247,284

 

 

 

26,086

 

 

 

1,025

 

Consumer other

 

 

132,812

 

 

 

152,894

 

 

 

164,667

 

 

 

(20,082

)

 

 

(31,855

)

Leases

 

 

5,386

 

 

 

9,407

 

 

 

24,163

 

 

 

(4,021

)

 

 

(18,777

)

Total loans

 

$

11,967,936

 

 

$

11,718,552

 

 

$

11,084,716

 

 

$

249,384

 

 

$

883,220

 

 

 

Average loans for the fourth quarter 2018 increased 2.1 percent on a linked-quarter basis and 8.0 percent compared to fourth quarter 2017.

Summary of average securities - QTD Average

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q4

 

 

Q3

 

 

Q4

 

 

CQ vs.

 

 

CQ vs.

 

 

 

2018

 

 

2018

 

 

2017

 

 

LQ

 

 

PY

 

Securities available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    U.S. Treasury

 

$

105,509

 

 

$

38,044

 

 

$

38,776

 

 

$

67,465

 

 

$

66,733

 

    U.S. Agencies

 

 

198

 

 

 

198

 

 

 

14,753

 

 

 

-

 

 

 

(14,555

)

    Mortgage-backed

 

 

3,703,212

 

 

 

3,590,703

 

 

 

3,484,304

 

 

 

112,509

 

 

 

218,908

 

    State and political subdivisions

 

 

2,353,816

 

 

 

2,290,906

 

 

 

2,555,462

 

 

 

62,910

 

 

 

(201,646

)

    Corporates

 

 

 

 

 

718

 

 

 

15,880

 

 

 

(718

)

 

 

(15,880

)

Total securities available for sale

 

$

6,162,735

 

 

$

5,920,569

 

 

$

6,109,175

 

 

$

242,166

 

 

$

53,560

 

Securities held to maturity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

State and political subdivisions

 

 

1,180,061

 

 

 

1,205,007

 

 

 

1,269,058

 

 

 

(24,946

)

 

 

(88,997

)

Trading securities

 

 

61,629

 

 

 

45,476

 

 

 

43,388

 

 

 

16,153

 

 

 

18,241

 

Other securities

 

 

66,760

 

 

 

65,962

 

 

 

63,543

 

 

 

798

 

 

 

3,217

 

Total securities

 

$

7,471,185

 

 

$

7,237,014

 

 

$

7,485,164

 

 

$

234,171

 

 

$

(13,979

)

 

Average securities available for sale increased 4.1 percent on a linked-quarter basis and remained flat compared to the fourth quarter of 2017.


Summary of average deposits - QTD Average

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q4

 

 

Q3

 

 

Q4

 

 

CQ vs.

 

 

CQ vs.

 

 

 

2018

 

 

2018

 

 

2017

 

 

LQ

 

 

PY

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Noninterest-bearing demand

 

$

6,052,011

 

 

$

5,547,880

 

 

$

6,180,293

 

 

$

504,131

 

 

$

(128,282

)

    Interest-bearing demand and savings

 

 

11,057,273

 

 

 

9,954,008

 

 

 

9,439,202

 

 

 

1,103,265

 

 

 

1,618,071

 

    Time deposits

 

 

1,060,838

 

 

 

1,030,411

 

 

 

1,230,303

 

 

 

30,427

 

 

 

(169,465

)

        Total deposits

 

$

18,170,122

 

 

$

16,532,299

 

 

$

16,849,798

 

 

$

1,637,823

 

 

$

1,320,324

 

Noninterest bearing deposits as % of total

 

 

33.31

%

 

 

33.56

%

 

 

36.68

%

 

 

 

 

 

 

 

 

 

 

Average deposits increased 9.9 percent on a linked-quarter basis and 7.8 percent as compared to the fourth quarter of 2017, primarily driven by the seasonal influx of public fund deposits as well as recent deposit campaigns.

Capital

 

Capital information

 

UMB Financial Corporation

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2018

 

 

September 30, 2018

 

 

December 31, 2017

 

Total equity

 

$

2,228,470

 

 

$

2,203,464

 

 

$

2,181,531

 

Book value per common share

 

 

45.37

 

 

 

44.20

 

 

 

43.72

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regulatory capital:

 

 

 

 

 

 

 

 

 

 

 

 

Common equity Tier 1 capital

 

$

2,142,469

 

 

$

2,175,700

 

 

$

2,041,504

 

Tier 1 capital

 

 

2,142,469

 

 

 

2,175,700

 

 

 

2,041,504

 

Total capital

 

 

2,318,145

 

 

 

2,348,731

 

 

 

2,213,050

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regulatory capital ratios:

 

 

 

 

 

 

 

 

 

 

 

 

Common equity Tier 1 capital ratio

 

 

12.89

%

 

 

13.47

%

 

 

12.95

%

Tier 1 risk-based capital ratio

 

 

12.89

 

 

 

13.47

 

 

 

12.95

 

Total risk-based capital ratio

 

 

13.95

 

 

 

14.54

 

 

 

14.04

 

Tier 1 leverage ratio

 

 

9.87

 

 

 

10.58

 

 

 

9.94

 

 

 

On December 17, 2018, the company completed its previously announced accelerated share repurchase (ASR) program with Bank of America Merrill Lynch.

 

Under the ASR, the company repurchased a total of 780,321 shares of its common stock (or approximately 1.6 percent of its outstanding common stock on October 23, 2018, the date the agreement governing the ASR was entered into) for an aggregate purchase price of $50.0 million.

 

At December 31, 2018, the regulatory capital ratios presented in the foregoing table reflect the impact of this ASR, and exceeded all “well-capitalized” regulatory thresholds.

 


Asset Quality

Credit quality

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q4

 

 

Q3

 

 

Q2

 

 

Q1

 

 

Q4

 

 

 

2018

 

 

2018

 

 

2018

 

 

2018

 

 

2017

 

Net charge-offs - Commercial loans

 

$

44,010

 

 

$

624

 

 

$

6,137

 

 

$

6,847

 

 

$

2,248

 

Net charge-offs (recoveries) - Real estate loans

 

 

28

 

 

 

408

 

 

 

1,035

 

 

 

1,512

 

 

 

(242

)

Net charge-offs - Consumer credit card loans

 

 

1,606

 

 

 

1,632

 

 

 

1,786

 

 

 

1,849

 

 

 

1,612

 

Net charge-offs - Consumer other loans

 

 

23

 

 

 

82

 

 

 

46

 

 

 

94

 

 

 

167

 

Net charge-offs - Total loans

 

 

45,667

 

 

 

2,746

 

 

 

9,004

 

 

 

10,302

 

 

 

3,785

 

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

 

 

1.51

%

 

 

0.09

%

 

 

0.32

%

 

 

0.37

%

 

 

0.14

%

Loans over 90 days past due

 

$

6,009

 

 

$

1,927

 

 

$

2,883

 

 

$

5,650

 

 

$

3,091

 

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

 

 

0.05

%

 

 

0.02

%

 

 

0.02

%

 

 

0.05

%

 

 

0.03

%

Nonaccrual and restructured loans

 

$