Atlantic Union Bankshares Corporation (the “Company” or
“Atlantic Union”) (NYSE: AUB) reported net income available to
common shareholders of $53.9 million and basic and diluted earnings
per common share of $0.72 for the fourth quarter of 2023 and
adjusted operating earnings available to common shareholders(1) of
$58.9 million and adjusted diluted operating earnings per common
share(1) of $0.78 for the fourth quarter of 2023.
Net income available to common shareholders was $190.0 million
and basic and diluted earnings per common share were $2.53 for the
year ended December 31, 2023. Adjusted operating earnings available
to common shareholders(1) were $221.2 million and adjusted diluted
operating earnings per common share(1) were $2.95 for the year
ended December 31, 2023.
In the fourth quarter of 2023, the Company’s adjusted operating
earnings(1) included the following main pre-tax adjustments:
- a $3.4 million Federal Deposit Insurance Corporation (“FDIC“)
special assessment;
- an additional $3.3 million legal reserve related to the
previously disclosed settlement with the Consumer Financial
Protection Bureau (“CFPB”);
- $1.0 million in merger related costs associated with our
pending merger with American National Bankshares Inc. (“American
National”); and
- $1.9 million gain related to a sale-leaseback transaction
executed in the quarter.
“Looking back at 2023, it was a successful year for Atlantic
Union, as we made good progress against our strategic plan,
successfully responded to challenges within the banking industry,
and delivered strong operating results,” said John C. Asbury,
president and chief executive officer of Atlantic Union. “We
undertook important actions that we believe will better position
Atlantic Union for the future and preserve positive operating
leverage, including a meaningful reduction to our structural
expense base, our pending acquisition of American National Bank in
Danville, Virginia, and balance sheet restructuring. Additionally,
our strong customer relationships, our stable deposit base, and
strong asset quality have served us well in this demanding
operating environment.”
“We believe that our model of a diversified, traditional,
full-service bank that delivers the products and services that our
customers want and need, combined with local decision making,
responsiveness, and client service orientation positively sets us
apart from other banks, both larger and smaller. Operating under
the mantra of soundness, profitability, and growth – in that order
of priority – Atlantic Union remains committed to generating
sustainable, profitable growth, and building long-term value for
our shareholders.”
NET INTEREST INCOME
For the fourth quarter of 2023, net interest income was $153.5
million, an increase of $1.6 million from $151.9 million in the
third quarter of 2023. Net interest income (FTE)(1) was $157.3
million in the fourth quarter of 2023, an increase of $1.6 million
from $155.7 million in the third quarter of 2023. The increases in
net interest income and net interest income (FTE)( 1) were driven
by higher yields on both available for sale (“AFS”) securities and
the loan portfolio, as well as growth in average loans held for
investment (“LHFI”). These increases were partially offset by
higher deposit costs driven by continued competition for deposits,
which drove higher customer deposit rates, changes in the deposit
mix, as depositors continue to migrate to higher costing interest
bearing deposit accounts, and growth in average deposit balances.
Our net interest margin decreased 1 basis point from the prior
quarter to 3.26% for the quarter ended December 31, 2023, and our
net interest margin (FTE)(1) decreased 1 basis point to 3.34% for
the quarter ended December 31, 2023. Earning asset yields for the
fourth quarter of 2023 increased 20 basis points to 5.59% compared
to the third quarter of 2023, primarily due to higher yields on
loans and investments, as well as loan growth. Our cost of funds
increased by 21 basis points to 2.25% at December 31, 2023 compared
to the prior quarter, due primarily to higher deposit costs driven
by higher rates and changes in the deposit mix as noted above.
The Company’s net interest margin (FTE) (1) includes the impact
of acquisition accounting fair value adjustments. Net accretion
related to acquisition accounting was $718,000 for the quarter
ended December 31, 2023, representing a decrease of $361,000. The
impact of net accretion in the third and fourth quarters of 2023
are reflected in the following table (dollars in thousands):
Loan
Deposit
Borrowings
Accretion
Amortization
Amortization
Total
For the quarter ended September 30,
2023
$
1,300
$
(6
)
$
(215
)
$
1,079
For the quarter ended December 31,
2023
937
(4
)
(215
)
718
ASSET QUALITY
Overview
At December 31, 2023, nonperforming assets (“NPAs”) as a
percentage of total LHFI was 0.24%, an increase of 5 basis points
from the prior quarter and included nonaccrual loans of $36.9
million. The increase in NPAs was primarily due to two new
nonaccrual loans within the commercial real estate – non owner
occupied and commercial and industrial portfolios. Accruing past
due loans as a percentage of total LHFI totaled 31 basis points at
December 31, 2023, an increase of 4 basis points from September 30,
2023, and an increase of 10 basis points from December 31, 2022.
The increase in past due loan levels from September 30, 2023 was
primarily within the 30-59 days past due category, primarily driven
by a seasonal increase in residential 1-4 family – consumer loans
that were 30 days past due as of year-end, the majority of which
subsequently became current. Net charge-offs were 0.03% of total
average LHFI (annualized) for the fourth quarter of 2023, an
increase of 2 basis points from September 30, 2023, and an increase
of 1 basis point from December 31, 2022. The allowance for credit
losses (“ACL”) totaled $148.5 million at December 31, 2023, a $7.5
million increase from the prior quarter.
Nonperforming Assets
At December 31, 2023, NPAs totaled $36.9 million, compared to
$28.8 million in the prior quarter. The following table shows a
summary of NPA balances at the quarter ended (dollars in
thousands):
December 31,
September 30,
June 30,
March 31,
December 31,
2023
2023
2023
2023
2022
Nonaccrual loans
$
36,860
$
28,626
$
29,105
$
29,082
$
27,038
Foreclosed properties
29
149
50
29
76
Total nonperforming assets
$
36,889
$
28,775
$
29,155
$
29,111
$
27,114
The following table shows the activity in nonaccrual loans for
the quarter ended (dollars in thousands):
December 31,
September 30,
June 30,
March 31,
December 31,
2023
2023
2023
2023
2022
Beginning Balance
$
28,626
$
29,105
$
29,082
$
27,038
$
26,500
Net customer payments
(2,198
)
(1,947
)
(5,950
)
(1,755
)
(1,805
)
Additions
10,604
1,651
6,685
4,151
2,935
Charge-offs
(172
)
(64
)
(712
)
(39
)
(461
)
Loans returning to accruing status
—
(119
)
—
(313
)
(131
)
Ending Balance
$
36,860
$
28,626
$
29,105
$
29,082
$
27,038
Past Due Loans
At December 31, 2023, past due loans still accruing interest
totaled $48.4 million or 0.31% of total LHFI, compared to $40.6
million or 0.27% of total LHFI at September 30, 2023, and $30.0
million or 0.21% of total LHFI at December 31, 2022. The increase
in past due loan levels at December 31, 2023 from September 30,
2023 was primarily within the 30-59 days past due category,
primarily driven by a seasonal increase related to residential 1-4
family – consumer loans that were 30 days past due at year-end, the
majority of which subsequently became current. Of the total past
due loans still accruing interest, $13.9 million or 0.09% of total
LHFI were loans past due 90 days or more at December 31, 2023,
compared to $11.9 million or 0.08% of total LHFI at September 30,
2023, and $7.5 million or 0.05% of total LHFI at December 31, 2022.
The increase in loans past due 90 days or more at December 31, 2023
from both September 30, 2023 was primarily due to one credit
relationship within the residential 1-4 family – commercial
portfolio and two credit relationships within the residential 1-4
family – consumer portfolio.
Allowance for Credit Losses
At December 31, 2023, the ACL was $148.5 million and included an
allowance for loan and lease losses (“ALLL”) of $132.2 million and
a reserve for unfunded commitments of $16.3 million. The ACL at
December 31, 2023 increased $7.5 million from September 30, 2023
primarily due to loan growth in the fourth quarter of 2023 and an
increase in the allowance on two individually assessed loans due to
changes in borrower-specific circumstances. The reserve for
unfunded commitments at December 31, 2023 increased $967,000 from
September 30, 2023, primarily driven by an increase in unfunded
commitments.
The ACL as a percentage of total LHFI was 0.95% at December 31,
2023, an increase of 3 basis points from September 30, 2023. The
ALLL as a percentage of total LHFI was 0.85% at December 31, 2023,
compared to 0.82% at September 30, 2023.
Net Charge-offs
Net charge-offs were $1.2 million or 0.03% of total average LHFI
on an annualized basis for the fourth quarter of 2023, compared to
$294,000 or 0.01% (annualized) for the third quarter of 2023, and
$810,000 or 0.02% (annualized) for the fourth quarter of 2022. The
majority of net charge-offs in the fourth quarter of 2023 were
related to overdrawn deposit accounts and third-party lending loans
within the consumer portfolio.
Provision for Credit Losses
For the fourth quarter of 2023, the Company recorded a provision
for credit losses of $8.7 million, compared to a provision for
credit losses of $5.0 million in the prior quarter, and a provision
for credit losses of $6.3 million in the fourth quarter of
2022.
NONINTEREST INCOME
Noninterest income increased $2.9 million to $30.0 million for
the fourth quarter of 2023 from $27.1 million in the prior quarter,
primarily driven by a $1.9 million gain related to a sale-leaseback
transaction associated with one branch location executed during the
fourth quarter, a $893,000 increase in loan-related interest rate
swap fees in the fourth quarter due to several new swap
transactions, and a $679,000 increase in loan syndication revenue
in the fourth quarter (included in other operating income). In
addition, other service charges, commissions, and fees decreased
$843,000 in the fourth quarter, primarily due to a merchant vendor
contract signing bonus realized in the prior quarter. Noninterest
income in the prior quarter also included a $27.7 million gain
related to the sale-leaseback transaction, included in other
operating income, which was almost wholly offset by $27.6 million
of losses incurred on the sale of AFS securities.
NONINTEREST EXPENSE
Noninterest expense decreased $579,000 to $107.9 million for the
fourth quarter of 2023 from $108.5 million in the prior quarter,
primarily driven by a decrease in other expenses due to costs
associated with our strategic cost savings initiatives in the third
quarter and lower merger-related costs associated with our pending
merger with American National in the fourth quarter, partially
offset by an increase in FDIC assessment premiums and other
insurance due to a special assessment fee incurred in the fourth
quarter and an increase in legal reserve related to our previously
disclosed settlement with the CFPB (included in other
expenses).
Adjusted operating noninterest expense,(1) which excludes
amortization of intangible assets ($2.1 million in the fourth
quarter and $2.2 million in the third quarter), a FDIC special
assessment ($3.4 million recognized in the fourth quarter), the
legal reserve related to our previously disclosed settlement with
the CFPB ($3.3 million in the fourth quarter), merger-related costs
associated with our pending merger with American National ($1.0
million in the fourth quarter and $2.0 million in the third
quarter), and expenses associated with strategic cost savings
initiatives ($8.7 million in the third quarter), increased $2.5
million to $98.2 million for the fourth quarter from $95.7 million
in the prior quarter, primarily due to a $1.2 million increase in
other expenses reflecting an increase in OREO and credit related
expenses, higher teammate training and travel expenses, and annual
debit card inventory purchases, a $1.1 million increase in
professional services expense primarily in support of strategic
initiatives in the fourth quarter and higher legal fees, a $799,000
increase in marketing and advertising expense primarily due to
annual customer disclosure mailings, and a $591,000 increase in
occupancy expense driven by the increased lease payments related to
the sale-leaseback transaction executed in the third quarter. These
increases were partially offset by a $763,000 decrease in salaries
and benefits, reflecting the impact of headcount reductions from
our strategic cost savings initiatives.
INCOME TAXES
The effective tax rate for the three months ended December 31,
2023 and 2022 was 14.9% and 14.3%, respectively, and the effective
tax rate for the years ended December 31, 2023 and 2022 was 15.9%
and 16.2%, respectively. The changes in the effective tax rate for
the quarter ended and year ended December 31, 2023, compared to
December 31, 2022 are primarily driven by the changes in the
proportion of tax-exempt income to pre-tax income.
BALANCE SHEET
At December 31, 2023, total assets were $21.2 billion, an
increase of $430.0 million or approximately 8.2% (annualized) from
September 30, 2023, and an increase of $705.1 million or
approximately 3.4% from December 31, 2022. Total assets increased
from the prior quarter primarily due to a $351.4 million increase
in LHFI (net of deferred fees and costs). In addition, investment
securities increased $151.1 million primarily due to a decrease in
unrealized losses in the AFS securities portfolio due to the impact
of declining market interest rates. Total assets increased from the
same period in the prior year primarily due to a $1.2 billion
increase in LHFI (net of deferred fees and costs), partially offset
by a $525.7 million decrease in investment securities due primarily
to the sale of AFS securities in the first quarter of 2023.
At December 31, 2023, LHFI (net of deferred fees and costs)
totaled $15.6 billion, an increase of $351.4 million or 9.1%
(annualized) from $15.3 billion at September 30, 2023, and an
increase of $1.2 billion or 8.2% from December 31, 2022. Quarterly
average LHFI (net of deferred fees and costs) totaled $15.4 billion
at December 31, 2023, an increase of $254.7 million or 6.7%
(annualized) from the prior quarter, and an increase of $1.3
billion or 9.0% from December 31, 2022. LHFI (net of deferred fees
and costs) increased from both the prior quarter and the prior
year, primarily due to increases in the commercial and industrial
and the multifamily real estate portfolios.
At December 31, 2023, total investments were $3.2 billion, an
increase of $151.1 million from September 30, 2023 and a decrease
of $525.7 million from December 31, 2022. AFS securities totaled
$2.2 billion at December 31, 2023, $2.1 billion at September 30,
2023, and $2.7 billion at December 31, 2022. Total net unrealized
losses on the AFS securities portfolio were $384.3 million at
December 31, 2023, compared to $523.1 million at September 30, 2023
and $462.5 million at December 31, 2022. Held to maturity
securities are carried at cost and totaled $837.4 million at
December 31, 2023, $843.3 million at September 30, 2023, and $847.7
million at December 31, 2022 and had net unrealized losses of $29.3
million at December 31, 2023, compared to $81.2 million at
September 30, 2023 and $45.8 million at December 31, 2022.
At December 31, 2023, total deposits were $16.8 billion, a
slight increase compared to the prior quarter. Average deposits at
December 31, 2023 increased from the prior quarter by $317.8
million or 7.5% (annualized). Total deposits at December 31, 2023
increased $886.5 million or 5.6% from December 31, 2022, and
quarterly average deposits at December 31, 2023 increased $501.6
million or 3.0% from the same period in the prior year. Total
deposits increased from the prior quarter and the same period in
the prior year primarily due to increases in interest bearing
customer deposits and brokered deposits, partially offset by
decreases in demand deposits.
At December 31, 2023, total borrowings were $1.3 billion, an
increase of $291.2 million from September 30, 2023, and a decrease
of $396.8 million from December 31, 2022. Total borrowings
increased from the prior quarter primarily due to increased
short-term borrowings used to fund loan growth and decreased from
the same period in the prior year due to paydowns of short-term
borrowings due to deposit growth.
The following table shows the Company’s capital ratios at the
quarters ended:
December 31,
September 30,
December 31,
2023
2023
2022
Common equity Tier 1 capital ratio (2)
9.84
%
9.94
%
9.95
%
Tier 1 capital ratio (2)
10.76
%
10.88
%
10.93
%
Total capital ratio (2)
13.55
%
13.70
%
13.70
%
Leverage ratio (Tier 1 capital to average
assets) (2)
9.63
%
9.62
%
9.42
%
Common equity to total assets
11.29
%
10.72
%
10.78
%
Tangible common equity to tangible assets
(1)
7.15
%
6.45
%
6.43
%
_________________________
During the fourth quarter of 2023, the Company declared and paid
a quarterly dividend on the outstanding shares of Series A
Preferred Stock of $171.88 per share (equivalent to $0.43 per
outstanding depositary share), consistent with the third quarter of
2023 and the fourth quarter of 2022. During the fourth quarter of
2023, the Company also declared and paid cash dividends of $0.32
per common share, a $0.02 increase or approximately 6.7% from both
the third quarter of 2023 and the fourth quarter of 2022.
_________________________
(1) These are financial measures not
calculated in accordance with generally accepted accounting
principles (“GAAP”). For a reconciliation of these non-GAAP
financial measures, see the “Alternative Performance Measures
(non-GAAP)” section of the Key Financial Results.
(2) All ratios at December 31, 2023 are
estimates and subject to change pending the Company’s filing of its
FR Y9-C. All other periods are presented as filed.
ABOUT ATLANTIC UNION BANKSHARES CORPORATION
Headquartered in Richmond, Virginia, Atlantic Union Bankshares
Corporation (NYSE: AUB) is the holding company for Atlantic Union
Bank. Atlantic Union Bank has 109 branches and 123 ATMs located
throughout Virginia and in portions of Maryland and North Carolina
as of December 31, 2023. Certain non-bank financial services
affiliates of Atlantic Union Bank include: Atlantic Union Equipment
Finance, Inc., which provides equipment financing; Atlantic Union
Financial Consultants, LLC, which provides brokerage services; and
Union Insurance Group, LLC, which offers various lines of insurance
products.
FOURTH QUARTER AND FULL YEAR 2023 EARNINGS RELEASE CONFERENCE
CALL
The Company will hold a conference call and webcast for
investors at 9:00 a.m. Eastern Time on Tuesday, January 23, 2024,
during which the Company’s management will review the Company’s
financial results for the fourth quarter and full year 2023 and
provide an update on recent activities.
The listen-only webcast and the accompanying slides can be
accessed at:
https://edge.media-server.com/mmc/p/7yyvrwjv.
For analysts who wish to participate in the conference call,
please register at the following URL:
https://register.vevent.com/register/BIfcd55f61c1d2456f9533b66bb36886b9.
To participate in the conference call, you must use the link to
receive an audio dial-in number and an Access PIN.
A replay of the webcast, and the accompanying slides, will be
available on the Company’s website for 90 days at:
https://investors.atlanticunionbank.com/.
NON-GAAP FINANCIAL MEASURES
In reporting the results as of and for the period ended December
31, 2023, the Company has provided supplemental performance
measures on a tax-equivalent, tangible, operating, adjusted or
pre-tax pre-provision basis. These non-GAAP financial measures are
a supplement to GAAP, which is used to prepare the Company’s
financial statements, and should not be considered in isolation or
as a substitute for comparable measures calculated in accordance
with GAAP. In addition, the Company’s non-GAAP financial measures
may not be comparable to non-GAAP financial measures of other
companies. The Company uses the non-GAAP financial measures
discussed herein in its analysis of the Company’s performance. The
Company’s management believes that these non-GAAP financial
measures provide additional understanding of ongoing operations,
enhance comparability of results of operations with prior periods
and show the effects of significant gains and charges in the
periods presented without the impact of items or events that may
obscure trends in the Company’s underlying performance. For a
reconciliation of these measures to their most directly comparable
GAAP measures and additional information about these non-GAAP
financial measures, see “Alternative Performance Measures
(non-GAAP)” in the tables within the section “Key Financial
Results.”
FORWARD-LOOKING STATEMENTS
This press release and statements by our management may
constitute “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements are statements that include, without limitation,
statements made in Mr. Asbury’s quotations, statements regarding
our expectations with regard to our business, financial and
operating results, including our deposit base and funding, the
impact of future economic conditions, changes in economic
conditions, our asset quality, our customer relationships, the
expected impact of our cost saving measures initiated in the second
quarter of 2023, and statements that include other projections,
predictions, expectations, or beliefs about future events or
results or otherwise are not statements of historical fact. Such
forward-looking statements are based on certain assumptions as of
the time they are made, and are inherently subject to known and
unknown risks, uncertainties, and other factors, some of which
cannot be predicted or quantified, that may cause actual results,
performance, or achievements to be materially different from those
expressed or implied by such forward-looking statements.
Forward-looking statements are often characterized by the use of
qualified words (and their derivatives) such as “expect,”
“believe,” “estimate,” “plan,” “project,” “anticipate,” “intend,”
“will,” “may,” “view,” “opportunity,” “potential,” “continue,”
“confidence,” or words of similar meaning or other statements
concerning opinions or judgment of the Company and our management
about future events. Although we believe that our expectations with
respect to forward-looking statements are based upon reasonable
assumptions within the bounds of our existing knowledge of our
business and operations, there can be no assurance that actual
future results, performance, or achievements of, or trends
affecting, us will not differ materially from any projected future
results, performance, achievements or trends expressed or implied
by such forward-looking statements. Actual future results,
performance, achievements or trends may differ materially from
historical results or those anticipated depending on a variety of
factors, including, but not limited to, the effects of or changes
in:
- market interest rates and their related impacts on
macroeconomic conditions, customer and client behavior, our funding
costs and our loan and securities portfolios;
- inflation and its impacts on economic growth and customer and
client behavior;
- adverse developments in the financial industry generally, such
as bank failures, responsive measures to mitigate and manage such
developments, related supervisory and regulatory actions and costs,
and related impacts on customer and client behavior;
- the sufficiency of liquidity;
- general economic and financial market conditions, in the United
States generally and particularly in the markets in which we
operate and which our loans are concentrated, including the effects
of declines in real estate values, an increase in unemployment
levels and slowdowns in economic growth;
- the failure to close our previously announced merger with
American National when expected or at all because required
regulatory approvals and other conditions to closing are not
received or satisfied on a timely basis or at all, and the risk
that any regulatory approvals may result in the imposition of
conditions that could adversely affect the combined company or the
expected benefits of the proposed merger;
- the occurrence of any event, change or other circumstances that
could give rise to the right of one or both of the parties to
terminate the merger agreement between the Company and American
National;
- any change in the purchase accounting assumptions used
regarding the American National assets acquired and liabilities
assumed to determine the fair value and credit marks, particularly
in light of the current interest rate environment;
- the possibility that the anticipated benefits of the proposed
merger, including anticipated cost savings and strategic gains, are
not realized when expected or at all;
- the proposed merger being more expensive or taking longer to
complete than anticipated, including as a result of unexpected
factors or events;
- the diversion of management’s attention from ongoing business
operations and opportunities do to the proposed merger;
- potential adverse reactions or changes to business or employee
relationships, including those resulting from the announcement or
completion of the proposed merger;
- the dilutive effect of shares of the Company’s common stock to
be issued at the completion of the proposed merger;
- changes in the Company’s or American National’s share price
before closing;
- monetary and fiscal policies of the U.S. government, including
policies of the U.S. Department of the Treasury and the Federal
Reserve;
- the quality or composition of our loan or investment portfolios
and changes therein;
- demand for loan products and financial services in our market
areas;
- our ability to manage our growth or implement our growth
strategy;
- the effectiveness of expense reduction plans;
- the introduction of new lines of business or new products and
services;
- our ability to recruit and retain key employees;
- real estate values in our lending area;
- changes in accounting principles, standards, rules, and
interpretations, and the related impact on our financial
statements;
- an insufficient ACL or volatility in the ACL resulting from the
CECL methodology, either alone or as that may be affected by
inflation, changing interest rates, or other factors;
- our liquidity and capital positions;
- concentrations of loans secured by real estate, particularly
commercial real estate;
- the effectiveness of our credit processes and management of our
credit risk;
- our ability to compete in the market for financial services and
increased competition from fintech companies;
- technological risks and developments, and cyber threats,
attacks, or events;
- operational, technological, cultural, regulatory, legal,
credit, and other risks associated with the exploration,
consummation and integration of potential future acquisitions,
whether involving stock or cash considerations;
- the potential adverse effects of unusual and infrequently
occurring events, such as weather-related disasters, terrorist
acts, geopolitical conflicts or public health events, and of
governmental and societal responses thereto; these potential
adverse effects may include, without limitation, adverse effects on
the ability of our borrowers to satisfy their obligations to us, on
the value of collateral securing loans, on the demand for our loans
or our other products and services, on supply chains and methods
used to distribute products and services, on incidents of
cyberattack and fraud, on our liquidity or capital positions, on
risks posed by reliance on third-party service providers, on other
aspects of our business operations and on financial markets and
economic growth;
- performance by our counterparties or vendors;
- deposit flows;
- the availability of financing and the terms thereof;
- the level of prepayments on loans and mortgage-backed
securities;
- legislative or regulatory changes and requirements;
- actual or potential claims, damages, and fines related to
litigation or government actions, which may result in, among other
things, additional costs, fines, penalties, restrictions on our
business activities, reputational harm, or other adverse
consequences;
- the effects of changes in federal, state or local tax laws and
regulations;
- any event or development that would cause us to conclude that
there was an impairment of any asset, including intangible assets,
such as goodwill; and
- other factors, many of which are beyond our control.
Please also refer to such other factors as discussed throughout
Part I, Item 1A. “Risk Factors” and Part II, Item 7. “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations” of our Annual Report on Form 10‑K for the year ended
December 31, 2022, Part II, Item 1A. Risk Factors in our Quarterly
Reports on Form 10-Q for the quarters ended June 30, 2023 and March
31, 2023, and related disclosures in other filings, which have been
filed with the U.S. Securities and Exchange Commission (“SEC”) and
are available on the SEC’s website at www.sec.gov. All risk factors
and uncertainties described herein and therein should be considered
in evaluating forward-looking statements, and all of the
forward-looking statements are expressly qualified by the
cautionary statements contained or referred to herein and therein.
The actual results or developments anticipated may not be realized
or, even if substantially realized, they may not have the expected
consequences to or effects on the Company or our businesses or
operations. Readers are cautioned not to rely too heavily on the
forward-looking statements, and undue reliance should not be placed
on such forward-looking statements. Forward-looking statements
speak only as of the date they are made. We do not intend or assume
any obligation to update, revise or clarify any forward-looking
statements that may be made from time to time by or on behalf of
the Company, whether as a result of new information, future events
or otherwise.
ATLANTIC UNION BANKSHARES CORPORATION
AND SUBSIDIARIES
KEY FINANCIAL RESULTS
(Dollars in thousands, except share
data)
As of & For Three Months
Ended
As of & For Year
Ended
12/31/23
09/30/23
12/31/22
12/31/23
12/31/22
(unaudited)
(unaudited)
(unaudited)
(unaudited)
(audited)
Results of
Operations
Interest and dividend income
$
259,497
$
247,159
$
202,068
$
954,450
$
660,435
Interest expense
105,953
95,218
38,220
343,437
76,174
Net interest income
153,544
151,941
163,848
611,013
584,261
Provision for credit losses
8,707
4,991
6,257
31,618
19,028
Net interest income after provision for
credit losses
144,837
146,950
157,591
579,395
565,233
Noninterest income
29,959
27,094
24,500
90,877
118,523
Noninterest expenses
107,929
108,508
99,790
430,371
403,802
Income before income taxes
66,867
65,536
82,301
239,901
279,954
Income tax expense
9,960
11,519
11,777
38,083
45,444
Net income
56,907
54,017
70,524
201,818
234,510
Dividends on preferred stock
2,967
2,967
2,967
11,868
11,868
Net income available to common
shareholders
$
53,940
$
51,050
$
67,557
$
189,950
$
222,642
Interest earned on earning assets (FTE)
(1)
$
263,209
$
250,903
$
206,186
$
969,360
$
675,308
Net interest income (FTE) (1)
157,256
155,685
167,966
625,923
599,134
Total revenue (FTE) (1)
187,215
182,779
192,466
716,800
717,657
Pre-tax pre-provision adjusted operating
earnings (7)
81,356
81,086
88,559
310,193
295,411
Key
Ratios
Earnings per common share, diluted
$
0.72
$
0.68
$
0.90
$
2.53
$
2.97
Return on average assets (ROA)
1.08
%
1.04
%
1.39
%
0.98
%
1.18
%
Return on average equity (ROE)
9.29
%
8.76
%
12.05
%
8.27
%
9.51
%
Return on average tangible common equity
(ROTCE) (2) (3)
16.72
%
15.71
%
22.92
%
14.85
%
17.33
%
Efficiency ratio
58.82
%
60.61
%
52.98
%
61.32
%
57.46
%
Efficiency ratio (FTE) (1)
57.65
%
59.37
%
51.85
%
60.04
%
56.27
%
Net interest margin
3.26
%
3.27
%
3.61
%
3.33
%
3.27
%
Net interest margin (FTE) (1)
3.34
%
3.35
%
3.70
%
3.41
%
3.36
%
Yields on earning assets (FTE) (1)
5.59
%
5.39
%
4.54
%
5.28
%
3.78
%
Cost of interest-bearing liabilities
3.04
%
2.80
%
1.24
%
2.59
%
0.64
%
Cost of deposits
2.23
%
1.97
%
0.72
%
1.78
%
0.34
%
Cost of funds
2.25
%
2.04
%
0.84
%
1.87
%
0.42
%
Operating
Measures (4)
Adjusted operating earnings
$
61,820
$
62,749
$
70,525
$
233,106
$
230,879
Adjusted operating earnings available to
common shareholders
58,853
59,782
67,558
221,238
219,011
Adjusted operating earnings per common
share, diluted
$
0.78
$
0.80
$
0.90
$
2.95
$
2.92
Adjusted operating ROA
1.18
%
1.21
%
1.39
%
1.14
%
1.16
%
Adjusted operating ROE
10.09
%
10.17
%
12.05
%
9.55
%
9.37
%
Adjusted operating ROTCE (2) (3)
18.20
%
18.31
%
22.92
%
17.21
%
17.06
%
Adjusted operating efficiency ratio (FTE)
(1)(6)
52.97
%
52.36
%
50.61
%
54.15
%
54.68
%
Per Share
Data
Earnings per common share, basic
$
0.72
$
0.68
$
0.90
$
2.53
$
2.97
Earnings per common share, diluted
0.72
0.68
0.90
2.53
2.97
Cash dividends paid per common share
0.32
0.30
0.30
1.22
1.16
Market value per share
36.54
28.78
35.14
36.54
35.14
Book value per common share
32.06
29.82
29.68
32.06
29.68
Tangible book value per common share
(2)
19.39
17.12
16.87
19.39
16.87
Price to earnings ratio, diluted
12.80
10.65
9.79
14.42
11.83
Price to book value per common share
ratio
1.14
0.97
1.18
1.14
1.18
Price to tangible book value per common
share ratio (2)
1.88
1.68
2.08
1.88
2.08
Weighted average common shares
outstanding, basic
75,016,402
74,999,128
74,712,040
74,961,390
74,949,109
Weighted average common shares
outstanding, diluted
75,016,858
74,999,128
74,713,972
74,962,363
74,953,398
Common shares outstanding at end of
period
75,023,327
74,997,132
74,712,622
75,023,327
74,712,622
ATLANTIC UNION BANKSHARES CORPORATION
AND SUBSIDIARIES
KEY FINANCIAL RESULTS
(Dollars in thousands, except share
data)
As of & For Three Months
Ended
As of & For Year
Ended
12/31/23
09/30/23
12/31/22
12/31/23
12/31/22
(unaudited)
(unaudited)
(unaudited)
(unaudited)
(audited)
Capital
Ratios
Common equity Tier 1 capital ratio (5)
9.84
%
9.94
%
9.95
%
9.84
%
9.95
%
Tier 1 capital ratio (5)
10.76
%
10.88
%
10.93
%
10.76
%
10.93
%
Total capital ratio (5)
13.55
%
13.70
%
13.70
%
13.55
%
13.70
%
Leverage ratio (Tier 1 capital to average
assets) (5)
9.63
%
9.62
%
9.42
%
9.63
%
9.42
%
Common equity to total assets
11.29
%
10.72
%
10.78
%
11.29
%
10.78
%
Tangible common equity to tangible assets
(2)
7.15
%
6.45
%
6.43
%
7.15
%
6.43
%
Financial
Condition
Assets
$
21,166,197
$
20,736,236
$
20,461,138
$
21,166,197
$
20,461,138
LHFI (net of deferred fees and costs)
15,635,043
15,283,620
14,449,142
15,635,043
14,449,142
Securities
3,184,111
3,032,982
3,709,761
3,184,111
3,709,761
Earning Assets
19,010,309
18,491,561
18,271,430
19,010,309
18,271,430
Goodwill
925,211
925,211
925,211
925,211
925,211
Amortizable intangibles, net
19,183
21,277
26,761
19,183
26,761
Deposits
16,818,129
16,786,505
15,931,677
16,818,129
15,931,677
Borrowings
1,311,858
1,020,669
1,708,700
1,311,858
1,708,700
Stockholders' equity
2,556,327
2,388,801
2,372,737
2,556,327
2,372,737
Tangible common equity (2)
1,445,576
1,275,956
1,254,408
1,445,576
1,254,408
LHFI, net of
deferred fees and costs
Construction and land development
$
1,107,850
$
1,132,940
$
1,101,260
$
1,107,850
$
1,101,260
Commercial real estate - owner
occupied
1,998,787
1,975,281
1,982,608
1,998,787
1,982,608
Commercial real estate - non-owner
occupied
4,172,401
4,148,218
3,996,130
4,172,401
3,996,130
Multifamily real estate
1,061,997
947,153
802,923
1,061,997
802,923
Commercial & Industrial
3,589,347
3,432,319
2,983,349
3,589,347
2,983,349
Residential 1-4 Family - Commercial
522,580
517,034
538,063
522,580
538,063
Residential 1-4 Family - Consumer
1,078,173
1,057,294
940,275
1,078,173
940,275
Residential 1-4 Family - Revolving
619,433
599,282
585,184
619,433
585,184
Auto
486,926
534,361
592,976
486,926
592,976
Consumer
120,641
126,151
152,545
120,641
152,545
Other Commercial
876,908
813,587
773,829
876,908
773,829
Total LHFI
$
15,635,043
$
15,283,620
$
14,449,142
$
15,635,043
$
14,449,142
Deposits
Interest checking accounts
$
4,697,819
$
5,055,464
$
4,186,505
$
4,697,819
$
4,186,505
Money market accounts
3,850,679
3,472,953
3,922,533
3,850,679
3,922,533
Savings accounts
909,223
950,363
1,130,899
909,223
1,130,899
Customer time deposits of $250,000 and
over
674,939
634,950
405,060
674,939
405,060
Other customer time deposits
2,173,904
2,011,106
1,396,011
2,173,904
1,396,011
Time deposits
2,848,843
2,646,056
1,801,071
2,848,843
1,801,071
Total interest-bearing customer
deposits
12,306,564
12,124,836
11,041,008
12,306,564
11,041,008
Brokered deposits
548,384
516,720
7,430
548,384
7,430
Total interest-bearing deposits
$
12,854,948
$
12,641,556
$
11,048,438
$
12,854,948
$
11,048,438
Demand deposits
3,963,181
4,144,949
4,883,239
3,963,181
4,883,239
Total deposits
$
16,818,129
$
16,786,505
$
15,931,677
$
16,818,129
$
15,931,677
Averages
Assets
$
20,853,306
$
20,596,189
$
20,174,152
$
20,512,402
$
19,949,388
LHFI (net of deferred fees and costs)
15,394,500
15,139,761
14,117,433
14,949,487
13,671,714
Loans held for sale
6,470
10,649
7,809
9,357
14,519
Securities
3,031,475
3,101,658
3,644,196
3,192,891
3,896,337
Earning assets
18,676,967
18,462,505
18,000,596
18,368,806
17,853,216
Deposits
17,113,369
16,795,611
16,611,749
16,653,888
16,451,718
Time deposits
3,128,048
2,914,004
1,764,596
2,711,491
1,735,983
Interest-bearing deposits
13,026,138
12,576,776
11,415,032
12,311,751
11,172,759
Borrowings
792,629
905,170
816,818
971,715
700,271
Interest-bearing liabilities
13,818,767
13,481,946
12,231,850
13,283,466
11,873,030
Stockholders' equity
2,430,711
2,446,902
2,321,208
2,440,525
2,465,049
Tangible common equity (2)
1,318,952
1,332,993
1,201,732
1,326,007
1,333,751
ATLANTIC UNION BANKSHARES CORPORATION
AND SUBSIDIARIES
KEY FINANCIAL RESULTS
(Dollars in thousands, except share
data)
As of & For Three Months
Ended
As of & For Year
Ended
12/31/23
09/30/23
12/31/22
12/31/23
12/31/22
(unaudited)
(unaudited)
(unaudited)
(unaudited)
(audited)
Asset
Quality
Allowance for
Credit Losses (ACL)
Beginning balance, Allowance for loan and
lease losses (ALLL)
$
125,627
$
120,683
$
108,009
$
110,768
$
99,787
Add: Recoveries
853
1,335
1,332
4,390
5,076
Less: Charge-offs
2,038
1,629
2,142
11,995
7,409
Add: Provision for loan losses
7,740
5,238
3,569
29,019
13,314
Ending balance, ALLL
$
132,182
$
125,627
$
110,768
$
132,182
$
110,768
Beginning balance, Reserve for unfunded
commitment (RUC)
$
15,302
$
15,548
$
11,000
$
13,675
$
8,000
Add: Provision for unfunded
commitments
967
(246)
2,675
2,594
5,675
Ending balance, RUC
$
16,269
$
15,302
$
13,675
$
16,269
$
13,675
Total ACL
$
148,451
$
140,929
$
124,443
$
148,451
$
124,443
ACL / total LHFI
0.95
%
0.92
%
0.86
%
0.95
%
0.86
%
ALLL / total LHFI
0.85
%
0.82
%
0.77
%
0.85
%
0.77
%
Net charge-offs / total average LHFI
(annualized)
0.03
%
0.01
%
0.02
%
0.05
%
0.02
%
Provision for loan losses/ total average
LHFI (annualized)
0.20
%
0.14
%
0.10
%
0.19
%
0.10
%
Nonperforming
Assets
Construction and land development
$
348
$
355
$
307
$
348
$
307
Commercial real estate - owner
occupied
3,001
3,882
7,178
3,001
7,178
Commercial real estate - non-owner
occupied
12,616
5,999
1,263
12,616
1,263
Commercial & Industrial
4,556
2,256
1,884
4,556
1,884
Residential 1-4 Family - Commercial
1,804
1,833
1,904
1,804
1,904
Residential 1-4 Family - Consumer
11,098
10,368
10,846
11,098
10,846
Residential 1-4 Family - Revolving
3,087
3,572
3,453
3,087
3,453
Auto
350
361
200
350
200
Consumer
—
—
3
—
3
Nonaccrual loans
$
36,860
$
28,626
$
27,038
$
36,860
$
27,038
Foreclosed property
29
149
76
29
76
Total nonperforming assets (NPAs)
$
36,889
$
28,775
$
27,114
$
36,889
$
27,114
Construction and land development
$
25
$
25
$
100
$
25
$
100
Commercial real estate - owner
occupied
2,579
2,395
2,167
2,579
2,167
Commercial real estate - non-owner
occupied
2,967
2,835
607
2,967
607
Commercial & Industrial
782
792
459
782
459
Residential 1-4 Family - Commercial
1,383
817
275
1,383
275
Residential 1-4 Family - Consumer
4,470
3,632
1,955
4,470
1,955
Residential 1-4 Family - Revolving
1,095
1,034
1,384
1,095
1,384
Auto
410
229
344
410
344
Consumer
152
97
108
152
108
Other Commercial
—
15
91
—
91
LHFI ≥ 90 days and still accruing
$
13,863
$
11,871
$
7,490
$
13,863
$
7,490
Total NPAs and LHFI ≥ 90 days
$
50,752
$
40,646
$
34,604
$
50,752
$
34,604
NPAs / total LHFI
0.24
%
0.19
%
0.19
%
0.24
%
0.19
%
NPAs / total assets
0.17
%
0.14
%
0.13
%
0.17
%
0.13
%
ALLL / nonaccrual loans
358.61
%
438.86
%
409.68
%
358.61
%
409.68
%
ALLL/ nonperforming assets
358.32
%
436.58
%
408.53
%
358.32
%
408.53
%
ATLANTIC UNION BANKSHARES CORPORATION
AND SUBSIDIARIES
KEY FINANCIAL RESULTS
(Dollars in thousands, except share
data)
As of & For Three Months
Ended
As of & For Year
Ended
12/31/23
09/30/23
12/31/22
12/31/23
12/31/22
(unaudited)
(unaudited)
(unaudited)
(unaudited)
(audited)
Past Due
Detail
Construction and land development
$
270
$
—
$
1,253
$
270
$
1,253
Commercial real estate - owner
occupied
1,575
3,501
2,305
1,575
2,305
Commercial real estate - non-owner
occupied
545
4,573
1,121
545
1,121
Commercial & Industrial
4,303
3,049
824
4,303
824
Residential 1-4 Family - Commercial
567
744
1,231
567
1,231
Residential 1-4 Family - Consumer
7,546
1,000
5,951
7,546
5,951
Residential 1-4 Family - Revolving
2,238
2,326
1,843
2,238
1,843
Auto
4,737
2,703
2,747
4,737
2,747
Consumer
770
517
351
770
351
Other Commercial
6,569
3,545
—
6,569
—
LHFI 30-59 days past due
$
29,120
$
21,958
$
18,855
$
29,120
$
18,855
Construction and land development
$
24
$
386
$
45
$
24
$
45
Commercial real estate - owner
occupied
—
1,902
635
—
635
Commercial real estate - non-owner
occupied
184
797
48
184
48
Multifamily real estate
146
150
—
146
—
Commercial & Industrial
49
576
174
49
174
Residential 1-4 Family - Commercial
676
67
—
676
—
Residential 1-4 Family - Consumer
1,804
1,775
1,690
1,804
1,690
Residential 1-4 Family - Revolving
1,429
602
511
1,429
511
Auto
872
339
450
872
450
Consumer
232
164
125
232
125
LHFI 60-89 days past due
$
5,416
$
6,758
$
3,678
$
5,416
$
3,678
Past Due and still accruing
$
48,399
$
40,587
$
30,023
$
48,399
$
30,023
Past Due and still accruing / total
LHFI
0.31
%
0.27
%
0.21
%
0.31
%
0.21
%
Alternative
Performance Measures (non-GAAP)
Net interest
income (FTE) (1)
Net interest income (GAAP)
$
153,544
$
151,941
$
163,848
$
611,013
$
584,261
FTE adjustment
3,712
3,744
4,118
14,910
14,873
Net interest income (FTE) (non-GAAP)
$
157,256
$
155,685
$
167,966
$
625,923
$
599,134
Noninterest income (GAAP)
29,959
27,094
24,500
90,877
118,523
Total revenue (FTE) (non-GAAP)
$
187,215
$
182,779
$
192,466
$
716,800
$
717,657
Average earning assets
$
18,676,967
$
18,462,505
$
18,000,596
$
18,368,806
$
17,853,216
Net interest margin
3.26
%
3.27
%
3.61
%
3.33
%
3.27
%
Net interest margin (FTE)
3.34
%
3.35
%
3.70
%
3.41
%
3.36
%
Tangible
Assets (2)
Ending assets (GAAP)
$
21,166,197
$
20,736,236
$
20,461,138
$
21,166,197
$
20,461,138
Less: Ending goodwill
925,211
925,211
925,211
925,211
925,211
Less: Ending amortizable intangibles
19,183
21,277
26,761
19,183
26,761
Ending tangible assets (non-GAAP)
$
20,221,803
$
19,789,748
$
19,509,166
$
20,221,803
$
19,509,166
Tangible Common
Equity (2)
Ending equity (GAAP)
$
2,556,327
$
2,388,801
$
2,372,737
$
2,556,327
$
2,372,737
Less: Ending goodwill
925,211
925,211
925,211
925,211
925,211
Less: Ending amortizable intangibles
19,183
21,277
26,761
19,183
26,761
Less: Perpetual preferred stock
166,357
166,357
166,357
166,357
166,357
Ending tangible common equity
(non-GAAP)
$
1,445,576
$
1,275,956
$
1,254,408
$
1,445,576
$
1,254,408
Average equity (GAAP)
$
2,430,711
$
2,446,902
$
2,321,208
$
2,440,525
$
2,465,049
Less: Average goodwill
925,211
925,211
925,211
925,211
930,315
Less: Average amortizable intangibles
20,192
22,342
27,909
22,951
34,627
Less: Average perpetual preferred
stock
166,356
166,356
166,356
166,356
166,356
Average tangible common equity
(non-GAAP)
$
1,318,952
$
1,332,993
$
1,201,732
$
1,326,007
$
1,333,751
ROTCE
(2)(3)
Net income available to common
shareholders (GAAP)
$
53,940
$
51,050
$
67,557
$
189,950
$
222,642
Plus: Amortization of intangibles, tax
effected
1,654
1,732
1,881
6,937
8,544
Net income available to common
shareholders before amortization of intangibles (non-GAAP)
$
55,594
$
52,782
$
69,438
$
196,887
$
231,186
Return on average tangible common equity
(ROTCE)
16.72
%
15.71
%
22.92
%
14.85
%
17.33
%
ATLANTIC UNION BANKSHARES CORPORATION
AND SUBSIDIARIES
KEY FINANCIAL RESULTS
(Dollars in thousands, except share
data)
As of & For Three Months
Ended
As of & For Year
Ended
12/31/23
09/30/23
12/31/22
12/31/23
12/31/22
(unaudited)
(unaudited)
(unaudited)
(unaudited)
(audited)
Operating
Measures (4)
Net income (GAAP)
$
56,907
$
54,017
$
70,524
$
201,818
$
234,510
Plus: Strategic cost saving initiatives,
net of tax
—
6,851
—
9,959
—
Plus: Merger-related costs, net of tax
884
1,965
—
2,850
—
Plus: Legal reserve, net of tax
2,859
—
—
6,809
—
Plus: FDIC special assessment, net of
tax
2,656
—
—
2,656
—
Plus: Strategic branch closing and
facility consolidation costs, net of tax
—
—
—
—
4,351
Less: Gain (loss) on sale of securities,
net of tax
2
(21,799
)
(1
)
(32,381
)
(2
)
Less: Gain on sale-leaseback transaction,
net of tax
1,484
21,883
—
23,367
—
Less: Gain on sale of DHFB, net of tax
—
—
—
—
7,984
Adjusted operating earnings (non-GAAP)
61,820
62,749
70,525
233,106
230,879
Less: Dividends on preferred stock
2,967
2,967
2,967
11,868
11,868
Adjusted operating earnings available to
common shareholders (non-GAAP)
$
58,853
$
59,782
$
67,558
$
221,238
$
219,011
Operating
Efficiency Ratio (1)(6)
Noninterest expense (GAAP)
$
107,929
$
108,508
$
99,790
$
430,371
$
403,802
Less: Amortization of intangible
assets
2,094
2,193
2,381
8,781
10,815
Less: Strategic cost saving
initiatives
—
8,672
—
12,607
—
Less: Merger-related costs
1,002
1,993
—
2,995
—
Less: Legal reserve
3,300
—
—
8,300
—
Less: FDIC special assessment
3,362
—
—
3,362
—
Less: Strategic branch closing and
facility consolidation costs
—
—
—
—
5,508
Adjusted operating noninterest expense
(non-GAAP)
$
98,171
$
95,650
$
97,409
$
394,326
$
387,479
Noninterest income (GAAP)
$
29,959
$
27,094
$
24,500
$
90,877
$
118,523
Less: Gain (loss) on sale of
securities
3
(27,594
)
(1
)
(40,989
)
(3
)
Less: Gain on sale-leaseback
transaction
1,879
27,700
—
29,579
—
Less: Gain on sale of DHFB
—
—
—
—
9,082
Adjusted operating noninterest income
(non-GAAP)
$
28,077
$
26,988
$
24,501
$
102,287
$
109,444
Net interest income (FTE) (non-GAAP)
(1)
$
157,256
$
155,685
$
167,966
$
625,923
$
599,134
Adjusted operating noninterest income
(non-GAAP)
28,077
26,988
24,501
102,287
109,444
Total adjusted revenue (FTE) (non-GAAP)
(1)
$
185,333
$
182,673
$
192,467
$
728,210
$
708,578
Efficiency ratio
58.82
%
60.61
%
52.98
%
61.32
%
57.46
%
Efficiency ratio (FTE) (1)
57.65
%
59.37
%
51.85
%
60.04
%
56.27
%
Adjusted operating efficiency ratio (FTE)
(1)(6)
52.97
%
52.36
%
50.61
%
54.15
%
54.68
%
Operating ROA
& ROE (4)
Adjusted operating earnings (non-GAAP)
$
61,820
$
62,749
$
70,525
$
233,106
$
230,879
Average assets (GAAP)
$
20,853,306
$
20,596,189
$
20,174,152
$
20,512,402
$
19,949,388
Return on average assets (ROA) (GAAP)
1.08
%
1.04
%
1.39
%
0.98
%
1.18
%
Adjusted operating return on average
assets (ROA) (non-GAAP)
1.18
%
1.21
%
1.39
%
1.14
%
1.16
%
Average equity (GAAP)
$
2,430,711
$
2,446,902
$
2,321,208
$
2,440,525
$
2,465,049
Return on average equity (ROE) (GAAP)
9.29
%
8.76
%
12.05
%
8.27
%
9.51
%
Adjusted operating return on average
equity (ROE) (non-GAAP)
10.09
%
10.17
%
12.05
%
9.55
%
9.37
%
Operating
ROTCE (2)(3)(4)
Adjusted operating earnings available to
common shareholders (non-GAAP)
$
58,853
$
59,782
$
67,558
$
221,238
$
219,011
Plus: Amortization of intangibles, tax
effected
1,654
1,732
1,881
6,937
8,544
Adjusted operating earnings available to
common shareholders before amortization of intangibles
(non-GAAP)
$
60,507
$
61,514
$
69,439
$
228,175
$
227,555
Average tangible common equity
(non-GAAP)
$
1,318,952
$
1,332,993
$
1,201,732
$
1,326,007
$
1,333,751
Adjusted operating return on average
tangible common equity (non-GAAP)
18.20
%
18.31
%
22.92
%
17.21
%
17.06
%
Pre-tax
pre-provision adjusted operating earnings (7)
Net income (GAAP)
$
56,907
$
54,017
$
70,524
$
201,818
$
234,510
Plus: Provision for credit losses
8,707
4,991
6,257
31,618
19,028
Plus: Income tax expense
9,960
11,519
11,777
38,083
45,444
Plus: Strategic cost saving
initiatives
—
8,672
—
12,607
—
Plus: Merger-related costs
1,002
1,993
—
2,995
—
Plus: Legal reserve
3,300
—
—
8,300
—
Plus: FDIC special assessment, net of
tax
3,362
—
—
3,362
—
Plus: Strategic branch closing and
facility consolidation costs
—
—
—
—
5,508
Less: Gain (loss) on sale of
securities
3
(27,594
)
(1
)
(40,989
)
(3
)
Less: Gain on sale-leaseback
transaction
1,879
27,700
—
29,579
—
Less: Gain on sale of DHFB
—
—
—
—
9,082
Pre-tax pre-provision adjusted operating
earnings (non-GAAP)
$
81,356
$
81,086
$
88,559
$
310,193
$
295,411
Less: Dividends on preferred stock
2,967
2,967
2,967
11,868
11,868
Pre-tax pre-provision adjusted operating
earnings available to common shareholders (non-GAAP)
$
78,389
$
78,119
$
85,592
$
298,325
$
283,543
Weighted average common shares
outstanding, diluted
75,016,858
74,999,128
74,713,972
74,962,363
74,953,398
Pre-tax pre-provision earnings per common
share, diluted
$
1.04
$
1.04
$
1.15
$
3.98
$
3.78
ATLANTIC UNION BANKSHARES CORPORATION
AND SUBSIDIARIES
KEY FINANCIAL RESULTS
(Dollars in thousands, except share
data)
As of & For Three Months
Ended
As of & For Year
Ended
12/31/23
09/30/23
12/31/22
12/31/23
12/31/22
(unaudited)
(unaudited)
(unaudited)
(unaudited)
(audited)
Mortgage
Origination Held for Sale Volume
Refinance Volume
$
3,972
$
2,239
$
2,312
$
13,740
$
55,725
Purchase Volume
27,871
35,815
29,262
128,046
238,310
Total Mortgage loan originations held for
sale
$
31,843
$
38,054
$
31,574
$
141,786
$
294,035
% of originations held for sale that are
refinances
12.5
%
5.9
%
7.3
%
9.7
%
19.0
%
Wealth
Assets under management
$
5,014,208
$
4,675,523
$
4,271,728
$
5,014,208
$
4,271,728
Other
Data
End of period full-time employees
1,804
1,788
1,877
1,804
1,877
Number of full-service branches
109
109
114
109
114
Number of automatic transaction machines
("ATMs")
123
123
131
123
131
__________________________________
(1)
These are non-GAAP financial measures. The
Company believes net interest income (FTE), total revenue (FTE),
and total adjusted revenue (FTE), which are used in computing net
interest margin (FTE), efficiency ratio (FTE) and adjusted
operating efficiency ratio (FTE), provide valuable additional
insight into the net interest margin and the efficiency ratio by
adjusting for differences in tax treatment of interest income
sources. The entire FTE adjustment is attributable to interest
income on earning assets, which is used in computing yield on
earning assets. Interest expense and the related cost of
interest-bearing liabilities and cost of funds ratios are not
affected by the FTE components.
(2)
These are non-GAAP financial measures.
Tangible assets and tangible common equity are used in the
calculation of certain profitability, capital, and per share
ratios. The Company believes tangible assets, tangible common
equity and the related ratios are meaningful measures of capital
adequacy because they provide a meaningful base for
period-to-period and company-to-company comparisons, which the
Company believes will assist investors in assessing the capital of
the Company and its ability to absorb potential losses. The Company
believes tangible common equity is an important indication of its
ability to grow organically and through business combinations as
well as its ability to pay dividends and to engage in various
capital management strategies.
(3)
These are non-GAAP financial measures. The
Company believes that ROTCE is a meaningful supplement to GAAP
financial measures and is useful to investors because it measures
the performance of a business consistently across time without
regard to whether components of the business were acquired or
developed internally.
(4)
These are non-GAAP financial measures.
Adjusted operating measures exclude, as applicable, strategic cost
saving initiatives (principally composed of severance charges
related to headcount reductions, costs related to modifying certain
third party vendor contracts, and charges for exiting certain
leases), merger-related costs, a legal reserve associated with our
previously disclosed settlement with the CFPB, a FDIC special
assessment, strategic branch closing and related facility
consolidation costs (principally composed of real estate, leases
and other assets write downs, as well as severance and expense
reduction initiatives), gain (loss) on sale of securities, gain on
sale-leaseback transaction, and gain on sale of DHFB. The Company
believes these non-GAAP adjusted measures provide investors with
important information about the continuing economic results of the
organization’s operations.
(5)
All ratios at December 31, 2023 are
estimates and subject to change pending the Company’s filing of its
FR Y9‑C. All other periods are presented as filed.
(6)
The adjusted operating efficiency ratio
(FTE) excludes, as applicable, the amortization of intangible
assets, strategic cost saving initiatives, merger-related costs, a
legal reserve associated with our previously disclosed settlement
with the CFPB, a FDIC special assessment, strategic branch closing
and related facility consolidation costs, gain (loss) on sale of
securities, gain on sale-leaseback transaction, and gain on sale of
DHFB. This measure is similar to the measure utilized by the
Company when analyzing corporate performance and is also similar to
the measure utilized for incentive compensation. The Company
believes this adjusted measure provides investors with important
information about the continuing economic results of the
organization’s operations.
(7)
These are non-GAAP financial measures.
Pre-tax pre-provision adjusted earnings excludes, as applicable,
the provision for credit losses, which can fluctuate significantly
from period-to-period under the CECL methodology, income tax
expense, strategic cost saving initiatives, merger-related costs, a
legal reserve associated with our previously disclosed settlement
with the CFPB, a FDIC special assessment, strategic branch closure
initiatives and related facility consolidation costs, gain (loss)
on sale of securities, gain on sale-leaseback transaction, and gain
on sale of DHFB. The Company believes this adjusted measure
provides investors with important information about the continuing
economic results of the Company’s operations.
ATLANTIC UNION BANKSHARES CORPORATION
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share
data)
December 31,
September 30,
December 31,
2023
2023
2022
ASSETS
(unaudited)
(unaudited)
(audited)
Cash and cash equivalents:
Cash and due from banks
$
196,754
$
233,526
$
216,384
Interest-bearing deposits in other
banks
167,601
159,718
102,107
Federal funds sold
13,776
5,701
1,457
Total cash and cash equivalents
378,131
398,945
319,948
Securities available for sale, at fair
value
2,231,261
2,084,928
2,741,816
Securities held to maturity, at
carrying value
837,378
843,269
847,732
Restricted stock, at cost
115,472
104,785
120,213
Loans held for sale
6,710
6,608
3,936
Loans held for investment, net of
deferred fees and costs
15,635,043
15,283,620
14,449,142
Less: allowance for loan and lease
losses
132,182
125,627
110,768
Total loans held for investment,
net
15,502,861
15,157,993
14,338,374
Premises and equipment, net
90,959
94,510
118,243
Goodwill
925,211
925,211
925,211
Amortizable intangibles, net
19,183
21,277
26,761
Bank owned life insurance
452,565
449,452
440,656
Other assets
606,466
649,258
578,248
Total assets
$
21,166,197
$
20,736,236
$
20,461,138
LIABILITIES
Noninterest-bearing demand
deposits
$
3,963,181
$
4,144,949
$
4,883,239
Interest-bearing deposits
12,854,948
12,641,556
11,048,438
Total deposits
16,818,129
16,786,505
15,931,677
Securities sold under agreements to
repurchase
110,833
134,936
142,837
Other short-term borrowings
810,000
495,000
1,176,000
Long-term borrowings
391,025
390,733
389,863
Other liabilities
479,883
540,261
448,024
Total liabilities
18,609,870
18,347,435
18,088,401
Commitments and contingencies
STOCKHOLDERS'
EQUITY
Preferred stock, $10.00 par
value
173
173
173
Common stock, $1.33 par value
99,147
99,120
98,873
Additional paid-in capital
1,782,286
1,779,281
1,772,440
Retained earnings
1,018,070
988,133
919,537
Accumulated other comprehensive
loss
(343,349
)
(477,906
)
(418,286
)
Total stockholders' equity
2,556,327
2,388,801
2,372,737
Total liabilities and stockholders'
equity
$
21,166,197
$
20,736,236
$
20,461,138
Common shares outstanding
75,023,327
74,997,132
74,712,622
Common shares authorized
200,000,000
200,000,000
200,000,000
Preferred shares outstanding
17,250
17,250
17,250
Preferred shares authorized
500,000
500,000
500,000
ATLANTIC UNION BANKSHARES CORPORATION
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
INCOME
(Dollars in thousands, except share
data)
Three Months Ended
Year Ended
December 31,
September 30,
December 31,
December 31,
December 31,
2023
2023
2022
2023
2022
(unaudited)
(unaudited)
(unaudited)
(unaudited)
(audited)
Interest and dividend income:
Interest and fees on loans
$
230,378
$
221,380
$
173,475
$
846,923
$
555,614
Interest on deposits in other banks
2,255
1,309
1,383
6,071
2,612
Interest and dividends on securities:
Taxable
18,703
16,055
16,196
67,075
59,306
Nontaxable
8,161
8,415
11,014
34,381
42,903
Total interest and dividend
income
259,497
247,159
202,068
954,450
660,435
Interest expense:
Interest on deposits
95,998
83,590
30,236
296,689
56,201
Interest on short-term borrowings
5,043
6,499
3,588
27,148
5,393
Interest on long-term borrowings
4,912
5,129
4,396
19,600
14,580
Total interest expense
105,953
95,218
38,220
343,437
76,174
Net interest income
153,544
151,941
163,848
611,013
584,261
Provision for credit losses
8,707
4,991
6,257
31,618
19,028
Net interest income after provision for
credit losses
144,837
146,950
157,591
579,395
565,233
Noninterest income:
Service charges on deposit accounts
8,662
8,557
7,631
33,240
30,052
Other service charges, commissions and
fees
1,789
2,632
1,631
7,860
6,765
Interchange fees
2,581
2,314
2,571
9,678
9,110
Fiduciary and asset management fees
4,526
4,549
4,085
17,695
22,414
Mortgage banking income
774
666
379
2,743
7,085
Gain (loss) on sale of securities
3
(27,594
)
(1
)
(40,989
)
(3
)
Bank owned life insurance income
3,088
2,973
2,649
11,759
11,507
Loan-related interest rate swap fees
3,588
2,695
3,664
10,037
12,174
Other operating income
4,948
30,302
1,891
38,854
19,419
Total noninterest income
29,959
27,094
24,500
90,877
118,523
Noninterest expenses:
Salaries and benefits
56,686
57,449
58,723
236,682
228,926
Occupancy expenses
6,644
6,053
6,328
25,146
26,013
Furniture and equipment expenses
3,517
3,449
3,978
14,282
14,838
Technology and data processing
7,853
7,923
9,442
32,484
33,372
Professional services
4,346
3,291
4,456
15,483
16,730
Marketing and advertising expense
3,018
2,219
2,228
10,406
9,236
FDIC assessment premiums and other
insurance
7,630
4,258
1,896
19,861
10,241
Franchise and other taxes
4,505
4,510
4,500
18,013
18,006
Loan-related expenses
1,060
1,388
1,356
5,619
6,574
Amortization of intangible assets
2,094
2,193
2,381
8,781
10,815
Other expenses
10,576
15,775
4,502
43,614
29,051
Total noninterest expenses
107,929
108,508
99,790
430,371
403,802
Income before income taxes
66,867
65,536
82,301
239,901
279,954
Income tax expense
9,960
11,519
11,777
38,083
45,444
Net income
$
56,907
$
54,017
$
70,524
201,818
234,510
Dividends on preferred stock
2,967
2,967
2,967
11,868
11,868
Net income available to common
shareholders
$
53,940
$
51,050
$
67,557
$
189,950
$
222,642
Basic earnings per common share
$
0.72
$
0.68
$
0.90
$
2.53
$
2.97
Diluted earnings per common share
$
0.72
$
0.68
$
0.90
$
2.53
$
2.97
AVERAGE BALANCES, INCOME AND EXPENSES,
YIELDS AND RATES (TAXABLE EQUIVALENT BASIS) (UNAUDITED)
(Dollars in thousands)
For the Quarter Ended
December 31, 2023
September 30, 2023
Average Balance
Interest Income / Expense
(1)
Yield / Rate (1)(2)
Average Balance
Interest Income / Expense
(1)
Yield / Rate (1)(2)
Assets:
Securities:
Taxable
$
1,771,312
$
18,703
4.19%
$
1,799,675
$
16,055
3.54%
Tax-exempt
1,260,163
10,330
3.25%
1,301,983
10,653
3.25%
Total securities
3,031,475
29,033
3.80%
3,101,658
26,708
3.42%
LHFI, net of deferred fees and costs
(3)
15,394,500
231,687
5.97%
15,139,761
222,698
5.84%
Other earning assets
250,992
2,489
3.93%
221,086
1,497
2.69%
Total earning assets
18,676,967
$
263,209
5.59%
18,462,505
$
250,903
5.39%
Allowance for loan and lease losses
(123,954
)
(121,229
)
Total non-earning assets
2,300,293
2,254,913
Total assets
$
20,853,306
$
20,596,189
Liabilities and
Stockholders' Equity:
Interest-bearing deposits:
Transaction and money market accounts
$
8,974,437
$
64,456
2.85%
$
8,697,801
$
57,378
2.62%
Regular savings
923,653
509
0.22%
964,971
499
0.21%
Time deposits
3,128,048
31,033
3.94%
2,914,004
25,713
3.50%
Total interest-bearing deposits
13,026,138
95,998
2.92%
12,576,776
83,590
2.64%
Other borrowings
792,629
9,955
4.98%
905,170
11,628
5.10%
Total interest-bearing
liabilities
$
13,818,767
$
105,953
3.04%
$
13,481,946
$
95,218
2.80%
Noninterest-bearing
liabilities:
Demand deposits
4,087,231
4,218,835
Other liabilities
516,597
448,506
Total liabilities
18,422,595
18,149,287
Stockholders' equity
2,430,711
2,446,902
Total liabilities and stockholders'
equity
$
20,853,306
$
20,596,189
Net interest income (FTE)
$
157,256
$
155,685
Interest rate spread
2.55%
2.59%
Cost of funds
2.25%
2.04%
Net interest margin (FTE)
3.34%
3.35%
________________________
(1)
Income and yields are reported on a
taxable equivalent basis using the statutory federal corporate tax
rate of 21%.
(2)
Rates and yields are annualized and
calculated from rounded amounts in thousands, which appear
above.
(3)
Nonaccrual loans are included in average
loans outstanding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240123265061/en/
Robert M. Gorman - (804) 523‑7828 Executive Vice President /
Chief Financial Officer
Grafico Azioni Atlantic Union Bankshares (NYSE:AUB)
Storico
Da Ago 2024 a Set 2024
Grafico Azioni Atlantic Union Bankshares (NYSE:AUB)
Storico
Da Set 2023 a Set 2024