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Section 1: 8-K (FORM 8-K)

umbf-8k_20190423.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):  4/23/2019

 

 

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 April 23, 2019, UMB Financial Corporation (the “Company”) issued a press release announcing the financial results for the Company for the quarter ended March 31, 2019.  A copy of the press release is attached as Exhibit 99.1 and the information is hereby incorporated by reference herein.

 

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 is 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

 

The Company is furnishing a copy of materials that will be used in the presentation delivered by the Company’s representatives at the 2019 Annual Meeting of Shareholders that will be held at 9:00 a.m. (CT) on April 23, 2019 in the Company’s auditorium.  A copy of the materials is attached as Exhibit 99.2 and will be available on the Company’s website at www.umb.com.  The materials are dated April 23, 2019, and the Company disclaims any obligation to correct or update any of the materials in the future.

 

In addition, the Company is furnishing a copy of materials that will be used in the Company’s shareholder conference call at 8:30 a.m. (CT) on April 24, 2019.  A copy of the materials is attached as Exhibit 99.3 and will be available on the Company’s website at www.umb.com.  The materials are dated April 23, 2019, and the Company disclaims any obligation to correct or update any of the materials in the future.

 

The information provided under Item 7.01 of this Current Report on Form 8-K, including Exhibits 99.2 and 99.3 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 is 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 ended March 31, 2019.

 

 

99.2

Presentation for 2019 Annual Meeting of Shareholders.

 

 

99.3

Investor Presentation Materials, dated April 23, 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: April 23, 2019

 

 

 

(Back To Top)

Section 2: EX-99.1 (EX-99.1)

umbf-ex991_7.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 First Quarter Income from Continuing Operations of $57.7 Million or $1.18 per Diluted Share

 

KANSAS CITY, Mo. (April 23, 2019) – UMB Financial Corporation (Nasdaq: UMBF), a financial services company, announced income from continuing operations for the first quarter of 2019 of $57.7 million, or $1.18 per diluted share, compared to $25.5 million, or $0.52 per diluted share, in the fourth quarter 2018 (linked quarter) and $57.5 million, or $1.15 per diluted share, in the first quarter 2018. The reported GAAP income from continuing operations represents an increase of 126.9 percent on a linked-quarter basis and a 0.4 percent increase compared to the first quarter 2018.  

 

Net operating income from continuing operations, a non-GAAP financial measure reconciled to income from continuing operations, the nearest comparable GAAP measure, later in this release, was $58.2 million, or $1.19 per diluted share, for the first quarter 2019, compared to $27.6 million, or $0.56 per diluted share, for the linked quarter and $59.1 million, or $1.18 per diluted share, for the first quarter 2018. These results represent an increase of 111.1 percent on a linked-quarter basis and a decrease of 1.4 percent compared to first quarter 2018.

Summary of quarterly financial results

 

UMB Financial Corporation

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1

 

 

Q4

 

 

Q1

 

 

 

2019

 

 

2018

 

 

2018

 

Income from continuing operations

 

$

57,744

 

 

$

25,454

 

 

$

57,533

 

Loss from discontinued operations

 

 

 

 

 

 

 

 

(747

)

Net income

 

 

57,744

 

 

 

25,454

 

 

 

56,786

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share from continuing operations (diluted)

 

 

1.18

 

 

 

0.52

 

 

 

1.15

 

Losses per share from discontinued operations (diluted)

 

 

 

 

 

 

 

 

(0.01

)

Earnings per share (diluted)

 

 

1.18

 

 

 

0.52

 

 

 

1.14

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net operating income from continuing operations

 

 

58,208

 

 

 

27,578

 

 

 

59,062

 

Operating earnings per share from continuing operations (diluted)

 

 

1.19

 

 

 

0.56

 

 

 

1.18

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP - continuing operations

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets

 

 

1.02

%

 

 

0.46

%

 

 

1.12

%

Return on average equity

 

 

10.48

 

 

 

4.57

 

 

 

10.80

 

Efficiency ratio

 

 

70.00

 

 

 

71.26

 

 

 

68.82

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP - continuing operations

 

 

 

 

 

 

 

 

 

 

 

 

Operating return on average assets

 

 

1.03

%

 

 

0.50

%

 

 

1.15

%

Operating return on average equity

 

 

10.56

 

 

 

4.95

 

 

 

11.09

 

Operating efficiency ratio

 

 

69.78

 

 

 

70.19

 

 

 

68.04

 


 

 

 

2019 is off to a good start, and I’m pleased with the first quarter’s results,” said Mariner Kemper, chairman, president and chief executive officer. “We posted strong balance sheet growth, with average loan balances increasing 2.8 percent, or 11.2 percent on a linked-quarter annualized basis, and average deposits growing by 3.0 percent. Additionally, noninterest income represented 39.6 percent of our revenue for the quarter, and we saw positive trends in several of our lines of business.” 

 

Discussion of results from continuing operations

 

Summary of revenue

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1

 

 

Q4

 

 

Q1

 

 

CQ vs.

 

 

CQ vs.

 

 

 

2019

 

 

2018

 

 

2018

 

 

LQ

 

 

PY

 

Net interest income

 

$

163,868

 

 

$

161,808

 

 

$

147,922

 

 

$

2,060

 

 

$

15,946

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trust and securities processing

 

 

41,957

 

 

 

41,891

 

 

 

44,002

 

 

 

66

 

 

 

(2,045

)

Trading and investment banking

 

 

5,581

 

 

 

3,119

 

 

 

4,101

 

 

 

2,462

 

 

 

1,480

 

Service charges on deposit accounts

 

 

21,281

 

 

 

20,733

 

 

 

21,905

 

 

 

548

 

 

 

(624

)

Insurance fees and commissions

 

 

338

 

 

 

312

 

 

 

301

 

 

 

26

 

 

 

37

 

Brokerage fees

 

 

7,243

 

 

 

6,761

 

 

 

6,353

 

 

 

482

 

 

 

890

 

Bankcard fees

 

 

17,067

 

 

 

16,375

 

 

 

18,123

 

 

 

692

 

 

 

(1,056

)

Gains on sales of securities available for sale, net

 

 

809

 

 

 

 

 

 

139

 

 

 

809

 

 

 

670

 

Other

 

 

13,106

 

 

 

5,808

 

 

 

10,601

 

 

 

7,298

 

 

 

2,505

 

        Total noninterest income

 

$

107,382

 

 

$

94,999

 

 

$

105,525

 

 

$

12,383

 

 

$

1,857

 

Total revenue

 

$

271,250

 

 

$

256,807

 

 

$

253,447

 

 

$

14,443

 

 

$

17,803

 

Net interest margin

 

 

3.20

%

 

 

3.24

%

 

 

3.19

%

 

 

 

 

 

 

 

 

Total noninterest income as a % of total revenue

 

 

39.59

 

 

 

36.99

 

 

 

41.64

 

 

 

 

 

 

 

 

 

 

Net interest income

 

Net interest income totaled $163.9 million, an increase of $2.1 million, or 1.3 percent, from linked quarter levels, impacted by a $335.2 million, or 2.8 percent, increase in average loans and higher short-term interest rates.

 

Earning asset yields improved seven basis points from the linked quarter, due to improved loan yields of seven basis points to 5.18 percent, in part driven by favorable re-pricing from higher short-term interest rates and improved yields in the securities portfolio. The cost of interest-bearing liabilities increased 13 basis points to 1.34 percent, driven by an increase of $348.4 million in federal funds and repurchase agreements, and a nine-basis point increase in cost of interest-bearing deposits.

 

On a year-over-year basis, the increase in net interest income was driven by a 9.0 percent, or $1.0 billion, increase in average loans, as well as higher average loan yields, which increased 65 basis points compared to 2018, primarily driven by higher short-term interest rates, volume and asset mix changes.

 

For the first quarter 2019, average earning assets stood at $21.5 billion, an increase of 10.4 percent over the first quarter 2018.

Noninterest income

 

First quarter 2019 noninterest income increased $12.4 million, or 13.0 percent, on a linked quarter basis, largely due to:

 

o

Increases of $9.4 million and $2.0 million in company-owned life insurance income and derivative income, respectively, both of which are recorded in other income. These increases were partially offset by decreases of $2.6 million in gains on sales of assets and $0.9 million in loss recoveries, as compared to the fourth quarter 2018.  


 

o

An increase of $2.5 million in trading and investment banking due to increased trading volume and increased market values of trading assets held.

 

o

An increase of $0.7 million in bankcard fees due to a decrease of $0.9 million in rebates expense recorded as contra-revenues.

 

o

An increase of $0.8 million in gains on sales of available-for-sale securities.

 

 

Compared to the prior year, noninterest income in the first quarter of 2019 increased $1.9 million, or 1.8 percent, primarily driven by:

 

o

Increases of $3.1 million and $1.1 million in company-owned life insurance and derivative income, respectively, both of which are recorded in other income. These increases were partially offset by a decrease of $1.8 million in equity earnings on alternative investments.  

 

o

A $1.5 million increase in trading and investment banking income due to increased trading volume.

 

o

A $0.8 million increase in money market revenue recorded in brokerage fees.

 

o

These increases were offset by a decrease of $2.5 million in fund servicing revenue due to previously announced customer repricing and losses, which was partially offset by an increase of $1.2 million in corporate trust income, both recorded in trust and securities processing.

 

o

A $1.1 million decrease in bankcard fees primarily driven by an increase of $0.4 million in rewards expense recorded as contra-revenues, coupled with a decrease of $0.4 million in interchange income.

Noninterest expense

 

Summary of noninterest expense

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1

 

 

Q4

 

Q1

 

 

CQ vs.

 

 

CQ vs.

 

 

 

2019

 

 

2018

 

2018

 

 

LQ

 

 

PY

 

Salaries and employee benefits

 

$

116,032

 

 

$

103,992

 

$

107,968

 

 

$

12,040

 

 

$

8,064

 

Occupancy, net

 

 

11,743

 

 

 

11,845

 

 

10,953

 

 

 

(102

)

 

 

790

 

Equipment

 

 

19,684

 

 

 

18,983

 

 

18,826

 

 

 

701

 

 

 

858

 

Supplies and services

 

 

3,873

 

 

 

3,669

 

 

3,760

 

 

 

204

 

 

 

113

 

Marketing and business development

 

 

4,913

 

 

 

6,483

 

 

5,034

 

 

 

(1,570

)

 

 

(121

)

Processing fees

 

 

12,132

 

 

 

11,948

 

 

11,161

 

 

 

184

 

 

 

971

 

Legal and consulting

 

 

5,633

 

 

 

11,085

 

 

3,844

 

 

 

(5,452

)

 

 

1,789

 

Bankcard

 

 

4,345

 

 

 

4,316

 

 

4,626

 

 

 

29

 

 

 

(281

)

Amortization of other intangible assets

 

 

1,327

 

 

 

1,332

 

 

1,562

 

 

 

(5

)

 

 

(235

)

Regulatory fees

 

 

2,890

 

 

 

2,681

 

 

2,905

 

 

 

209

 

 

 

(15

)

Other

 

 

8,054

 

 

 

7,987

 

 

5,237

 

 

 

67

 

 

 

2,817

 

        Total noninterest expense

 

$

190,626

 

 

$

184,321

 

$

175,876

 

 

$

6,305

 

 

$

14,750

 

 

 

GAAP noninterest expense for the first quarter of 2019 was $190.6 million, an increase of $6.3 million, or 3.4 percent, from the linked quarter and an increase of $14.8 million, or 8.4 percent, from the first quarter of 2018.

 

On a non-GAAP basis, operating noninterest expense (as reconciled later in this release) was $190.0 million for the first quarter 2019, an increase of $8.4 million, or 4.6 percent, compared to the linked quarter and an increase of $16.1 million, or 9.3 percent, compared to the first quarter 2018.

 

The linked quarter increase in noninterest expense was driven by:


 

o

A $12.0 million increase in salaries and employee benefits, largely due to increased deferred compensation expense of $9.9 million and higher payroll taxes and 401(k) expense recognized in the first quarter of 2019.

 

o

A $0.7 million increase in equipment expense driven by higher software expense in the first quarter of 2019.

 

o

These increases were partially offset by decreases of $5.5 million in legal and consulting expense and $1.6 million in marketing and business development expense due to the timing of multiple projects.  

 

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

 

o

An $8.1 million increase in salaries and employee benefits, largely due to increased deferred compensation expense of $3.3 million, and increases of $1.8 million in bonus and incentives expense and $1.7 million in salaries and wages expense.  

 

o

An increase in other noninterest expense of $2.8 million primarily driven by an operational loss of $1.5 million and an increase of $1.2 million in derivative expense.

 

o

A $1.8 million increase in legal and consulting expense and an increase of $1.0 million 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

An increase of $0.9 million in equipment expense primarily driven by higher equipment maintenance and software expense in the first quarter of 2019.

Income taxes

 

The company’s effective tax rate was 15.4 percent for the quarter ended March 31, 2019, compared to 14.9 percent for the same period in 2018. This increase was primarily a result of a decrease in excess tax benefits associated with stock compensation recorded in the first quarter of 2019 as compared to the same period in 2018.

 

Balance sheet

 

Average total assets for the first quarter 2019 were $22.9 billion compared to $21.9 billion for the linked quarter and $20.7 billion for the same period in 2018.

Summary of average loans and leases - QTD Average

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1

 

 

Q4

 

 

Q1

 

 

CQ vs.

 

 

CQ vs.

 

 

 

2019

 

 

2018

 

 

2018

 

 

LQ

 

 

PY

 

Commercial

 

$

5,270,130

 

 

$

4,977,907

 

 

$

4,456,176

 

 

$

292,223

 

 

$

813,954

 

Asset-based loans

 

 

378,508

 

 

 

381,477

 

 

 

336,146

 

 

 

(2,969

)

 

 

42,362

 

Factoring loans

 

 

263,093

 

 

 

300,265

 

 

 

223,031

 

 

 

(37,172

)

 

 

40,062

 

Commercial credit card

 

 

195,872

 

 

 

178,772

 

 

 

189,891

 

 

 

17,100

 

 

 

5,981

 

Real estate - construction

 

 

787,483

 

 

 

826,310

 

 

 

763,867

 

 

 

(38,827

)

 

 

23,616

 

Real estate - commercial

 

 

3,797,206

 

 

 

3,663,610

 

 

 

3,635,455

 

 

 

133,596

 

 

 

161,751

 

Real estate - residential

 

 

714,534

 

 

 

697,927

 

 

 

645,803

 

 

 

16,607

 

 

 

68,731

 

Real estate - HELOC

 

 

528,468

 

 

 

555,161

 

 

 

630,617

 

 

 

(26,693

)

 

 

(102,149

)

Consumer credit card

 

 

217,570

 

 

 

248,309

 

 

 

223,725

 

 

 

(30,739

)

 

 

(6,155

)

Consumer other

 

 

145,100

 

 

 

132,812

 

 

 

158,131

 

 

 

12,288

 

 

 

(13,031

)

Leases

 

 

5,190

 

 

 

5,386

 

 

 

23,680

 

 

 

(196

)

 

 

(18,490

)

Total loans

 

$

12,303,154

 

 

$

11,967,936

 

 

$

11,286,522

 

 

$

335,218

 

 

$

1,016,632

 

 

 

Average loans for the first quarter 2019 increased 2.8 percent on a linked-quarter basis and 9.0 percent compared to the first quarter of 2018.


Summary of average securities - QTD Average

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1

 

 

Q4

 

 

Q1

 

 

CQ vs.

 

 

CQ vs.

 

 

 

2019

 

 

2018

 

 

2018

 

 

LQ

 

 

PY

 

Securities available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    U.S. Treasury

 

$

256,672

 

 

$

105,509

 

 

$

38,197

 

 

$

151,163

 

 

$

218,475

 

    U.S. Agencies

 

 

53,458

 

 

 

198

 

 

 

10,360

 

 

 

53,260

 

 

 

43,098

 

    Mortgage-backed

 

 

3,841,449

 

 

 

3,703,212

 

 

 

3,645,891

 

 

 

138,237

 

 

 

195,558

 

    State and political subdivisions

 

 

2,534,438

 

 

 

2,353,816

 

 

 

2,453,334

 

 

 

180,622

 

 

 

81,104

 

    Corporates

 

 

6,424

 

 

 

 

 

 

8,482

 

 

 

6,424

 

 

 

(2,058

)

    Commercial Paper

 

 

 

 

 

 

 

 

30,955

 

 

 

 

 

 

(30,955

)

Total securities available for sale

 

$

6,692,441

 

 

$

6,162,735

 

 

$

6,187,219

 

 

$

529,706

 

 

$

505,222

 

Securities held to maturity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

State and political subdivisions

 

 

1,157,126

 

 

 

1,180,061

 

 

 

1,251,771

 

 

 

(22,935

)

 

 

(94,645

)

Trading securities

 

 

46,408

 

 

 

61,629

 

 

 

44,592

 

 

 

(15,221

)

 

 

1,816

 

Other securities

 

 

74,718

 

 

 

66,760

 

 

 

65,560

 

 

 

7,958

 

 

 

9,158

 

Total securities

 

$

7,970,693

 

 

$

7,471,185

 

 

$

7,549,142

 

 

$

499,508

 

 

$

421,551

 

 

Average securities available for sale increased 8.6 percent on a linked-quarter basis and increased 8.2 percent compared to the first quarter of 2018.

Summary of average deposits - QTD Average

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1

 

 

Q4

 

 

Q1

 

 

CQ vs.

 

 

CQ vs.

 

 

 

2019

 

 

2018

 

 

2018

 

 

LQ

 

 

PY

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Noninterest-bearing demand

 

$

5,989,215

 

 

$

6,052,011

 

 

$

6,050,997

 

 

$

(62,796

)

 

$

(61,782

)

    Interest-bearing demand and savings

 

 

11,698,351

 

 

 

11,057,273

 

 

 

9,660,150

 

 

 

641,078

 

 

 

2,038,201

 

    Time deposits

 

 

1,034,763

 

 

 

1,060,838

 

 

 

1,047,700

 

 

 

(26,075

)

 

 

(12,937

)

        Total deposits

 

$

18,722,329

 

 

$

18,170,122

 

 

$

16,758,847

 

 

$

552,207

 

 

$

1,963,482

 

Noninterest bearing deposits as % of total

 

 

31.99

%

 

 

33.31

%

 

 

36.11

%

 

 

 

 

 

 

 

 

 

 

Average deposits increased 3.0 percent on a linked-quarter basis and 11.7 percent compared to the first quarter of 2018.

Capital

Capital information

 

UMB Financial Corporation

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2019

 

 

December 31, 2018

 

 

March 31, 2018

 

Total equity

 

$

2,350,843

 

 

$

2,228,470

 

 

$

2,167,386

 

Book value per common share

 

 

47.92

 

 

 

45.37

 

 

 

43.31

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regulatory capital:

 

 

 

 

 

 

 

 

 

 

 

 

Common equity Tier 1 capital

 

$

2,188,521

 

 

$

2,142,469

 

 

$

2,097,691

 

Tier 1 capital

 

 

2,188,521

 

 

 

2,142,469

 

 

 

2,097,691

 

Total capital

 

 

2,364,465

 

 

 

2,318,145

 

 

 

2,269,315

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regulatory capital ratios:

 

 

 

 

 

 

 

 

 

 

 

 

Common equity Tier 1 capital ratio

 

 

12.70

%

 

 

12.89

%

 

 

13.36

%

Tier 1 risk-based capital ratio

 

 

12.70

 

 

 

12.89

 

 

 

13.36

 

Total risk-based capital ratio

 

 

13.72

 

 

 

13.95

 

 

 

14.45

 

Tier 1 leverage ratio

 

 

9.65

 

 

 

9.87

 

 

 

10.20

 

 

 

At March 31, 2019, the regulatory capital ratios presented in the foregoing table exceeded all “well-capitalized” regulatory thresholds.


 

Asset Quality

Credit quality

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1

 

 

Q4

 

 

Q3

 

 

Q2

 

 

Q1

 

 

 

2019

 

 

2018

 

 

2018

 

 

2018

 

 

2018

 

Net charge-offs - Commercial loans

 

$

10,537

 

 

$

44,010

 

 

$

624

 

 

$

6,137

 

 

$

6,847

 

Net charge-offs - Real estate loans

 

 

41

 

 

 

28

 

 

 

408

 

 

 

1,035

 

 

 

1,512

 

Net charge-offs - Consumer credit card loans

 

 

1,676

 

 

 

1,606

 

 

 

1,632

 

 

 

1,786

 

 

 

1,849

 

Net charge-offs - Consumer other loans

 

 

70

 

 

 

23

 

 

 

82

 

 

 

46

 

 

 

94

 

Net charge-offs - Total loans

 

 

12,324

 

 

 

45,667

 

 

 

2,746

 

 

 

9,004

 

 

 

10,302

 

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

 

 

0.41

%

 

 

1.51

%

 

 

0.09

%

 

 

0.32

%

 

 

0.37

%

Loans over 90 days past due

 

$

1,874

 

 

$

6,009

 

 

$

1,927

 

 

$

2,883

 

 

$

5,650

 

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

 

 

0.01

%

 

 

0.05

%

 

 

0.02

%

 

 

0.02

%

 

 

0.05

%

Nonaccrual and restructured loans

 

$

63,270

 

 

$

43,018

 

 

$

50,568

 

 

$

56,030

 

 

$

67,604

 

Nonaccrual and restructured loans as a % of total loans

 

 

0.50

%

 

 

0.35

%

 

 

0.42

%

 

 

0.48

%

 

 

0.59

%

Provision for loan losses

 

$

12,350

 

 

$

48,000

 

 

$

5,750

 

 

$

7,000

 

 

$

10,000

 

 

 

Nonperforming loans, defined as restructured loans on nonaccrual and all other nonaccrual loans, increased $20.3 million from the linked quarter and decreased $4.3 million from the prior year.

 

Net charge-offs were $12.3 million, or 0.41 percent, of average loans, compared to $45.7 million, or 1.51 percent, of average loans in the linked quarter, and $10.3 million, or 0.37 percent, of average loans in the first quarter of 2018.

 

Provision for loan losses decreased $35.7 million from the linked quarter, and increased $2.4 million from the first quarter of 2018. This decrease was driven by higher provision during the linked quarter to cover the loss related to a $48.1 million factoring credit relationship, as well as other qualitative factors, such as macroeconomic conditions, loan growth, loan impairment changes, loan risk grading changes and net charge-off levels.

Conference Call

The company plans to host a conference call to discuss its first quarter 2019 earnings results on Wednesday, April 24, 2019, at 8:30 a.m. (CT).

 

Interested parties may access the call by dialing (toll-free) 877-267-8760 or (international) 412-542-4148 and requesting to join the UMB Financial call. The live call may also be accessed by visiting investorrelations.umb.com or by using the following link:

 

UMB Financial 1Q 2019 Conference Call

A replay of the conference call may be heard through May 10, 2019 by calling (toll-free)

877-344-7529 or (international) 412-317-0088. The replay access code required for playback is 10130187. The call replay may also be accessed at investorrelations.umb.com.

 

Non-GAAP Financial Information

In this release, we provide information about net operating income from continuing operations (net operating income), operating earnings per share from continuing operations - diluted (operating EPS), operating return on average equity (operating ROE), operating return on average assets (operating ROA), operating noninterest expense, and operating efficiency ratio, all of which are non-GAAP financial measures. This information supplements the results that are reported according to generally accepted accounting principles in the United States (GAAP) and should not be viewed in isolation from, or as a substitute for, GAAP results. The differences between the non-GAAP financial measures – net operating income, operating EPS, operating ROE, operating ROA, operating noninterest expense, and operating efficiency ratio – and the nearest comparable GAAP financial measures are reconciled later in this release. The company believes that these non-GAAP financial measures and the reconciliations may be


useful to investors because they adjust for acquisition-, divestiture-, and severance-related items that management does not believe reflect the company’s fundamental operating performance.

 

Net operating income for the relevant period is defined as GAAP net income, adjusted to reflect the impact of excluding expenses related to acquisitions and divestitures, severance expense, and the cumulative tax impact of these adjustments.

 

Operating EPS (diluted) is calculated as earnings per share as reported, adjusted to reflect, on a per share basis, the impact of excluding the non-GAAP adjustments described above for the relevant period. Operating ROE is calculated as net operating income from continuing operations, divided by the company’s average total shareholders’ equity for the relevant period. Operating ROA is calculated as net operating income from continuing operations, divided by the company’s average assets for the relevant period. Operating noninterest expense for the relevant period is defined as GAAP noninterest expense, adjusted to reflect the pre-tax impact of non-GAAP adjustments described above. Operating efficiency ratio is calculated as the company’s operating noninterest expense, net of amortization of other intangibles, divided by the company’s total non-GAAP revenue (calculated as net interest income plus noninterest income, less gains on sales of securities available for sale, net).

 

Forward-Looking Statements:

This press release contains, and our other communications may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as “believe,” “expect,” “anticipate,” “intend,” “estimate,” “project,” “outlook,” “forecast,” “target,” “trend,” “plan,” “goal,” or other words of comparable meaning or future-tense or conditional verbs such as “may,” “will,” “should,” “would,” or “could.” Forward-looking statements convey our expectations, intentions, or forecasts about future events, circumstances, results, or aspirations. All forward-looking statements are subject to assumptions, risks, and uncertainties, which may change over time and many of which are beyond our control. You should not rely on any forward-looking statement as a prediction or guarantee about the future. Our actual future objectives, strategies, plans, prospects, performance, condition, or results may differ materially from those set forth in any forward-looking statement. Some of the factors that may cause actual results or other future events, circumstances, or aspirations to differ from those in forward-looking statements are described in our Annual Report on Form 10-K for the year ended December 31, 2018, our subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K, or other applicable documents that are filed or furnished with the U.S. Securities and Exchange Commission (SEC). Any forward-looking statement made by us or on our behalf speaks only as of the date that it was made. We do not undertake to update any forward-looking statement to reflect the impact of events, circumstances, or results that arise after the date that the statement was made, except to the extent required by applicable securities laws. You, however, should consult further disclosures (including disclosures of a forward-looking nature) that we may make in any subsequent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K, or other applicable document that is filed or furnished with the SEC.

 

About UMB:

UMB Financial Corporation (Nasdaq: UMBF) is a financial services company headquartered in Kansas City, Mo. UMB offers personal banking, commercial banking, healthcare services and institutional banking, which includes services to mutual funds and alternative-investment entities and registered investment advisors. UMB operates banking and wealth management centers throughout Missouri, Illinois, Colorado, Kansas, Oklahoma, Nebraska, Arizona and Texas. For more information, visit UMB.com, UMB Blog or follow us on Twitter at @UMBBank, UMB Facebook and UMB LinkedIn.

 

 

 

 

 

 


Consolidated Balance Sheets

 

UMB Financial Corporation

 

(unaudited, dollars in thousands)

 

 

 

 

 

 

 

 

 

 

March 31,

 

 

 

2019

 

 

2018

 

ASSETS

 

 

 

 

 

 

 

 

Loans

 

$

12,549,732

 

 

$

11,458,794

 

Allowance for loan losses

 

 

(103,661

)

 

 

(100,302

)

Net loans

 

 

12,446,071

 

 

 

11,358,492

 

Loans held for sale

 

 

1,267

 

 

 

4,586

 

Investment Securities:

 

 

 

 

 

 

 

 

Available for sale

 

 

6,891,869

 

 

 

6,139,346

 

Held to maturity

 

 

1,147,947

 

 

 

1,246,466

 

Trading securities

 

 

56,025

 

 

 

65,389

 

Other securities

 

 

75,357

 

 

 

67,408

 

Total investment securities

 

 

8,171,198

 

 

 

7,518,609

 

Federal funds sold and resell agreements

 

 

264,772

 

 

 

127,208

 

Interest-bearing due from banks

 

 

1,113,470

 

 

 

671,163

 

Cash and due from banks

 

 

399,387