Selected highlights:
- Loans at December 31, 2015, increased
26.3 percent to $9.4 billion with legacy UMB loans having increased
13.2 percent to $8.4 billion compared to December 31, 2014
- Total deposits at December 31, 2015,
increased 10.8 percent to $15.1 billion with legacy UMB deposits
having increased 5.0 percent to $14.3 billion compared to December
31, 2014
- Fourth quarter 2015 earnings were $29.6
million, or $0.60 per diluted share, an increase of $2.7 million
compared to fourth quarter 2014 earnings
- Full-year 2015 earnings were $116.1
million, or $2.44 per diluted share, a decrease of $4.6 million
compared to full-year 2014 earnings
- Common equity Tier 1 capital ratio
remains strong at 11.70 percent
UMB Financial Corporation (Nasdaq: UMBF), a diversified
financial holding company, announced earnings for the three months
ended December 31, 2015, of $29.6 million or $0.61 per share ($0.60
diluted). This is an increase of $2.7 million, or 10.0 percent,
compared to fourth quarter 2014 earnings of $26.9 million or $0.60
per share ($0.59 diluted). Earnings for the year ended December 31,
2015, were $116.1 million or $2.46 per share ($2.44 diluted) or a
decrease of $4.6 million, or 3.8 percent, compared to the prior
year-end earnings of $120.7 million or $2.69 per share ($2.65
diluted).
The company is introducing the non-GAAP financial measure of net
operating income to facilitate the evaluation of its fundamental
operating performance. Net operating income, which is reconciled to
earnings (GAAP net income) later in this release, excludes (net of
tax) the contingency reserve expense related to an acquisition,
fair value adjustments to contingent consideration for
acquisitions, expenses related to an acquisition, and
non-acquisition severance expense. Net operating income for the
fourth quarter 2015 was $34.2 million or $0.70 per share ($0.70
diluted). This is an increase of $6.4 million, or 23.1 percent,
compared to fourth quarter 2014 net operating income of $27.8
million or $0.62 per share ($0.61 diluted). Net operating income
for the year ended December 31, 2015, was $123.4 million or $2.62
per share ($2.59 diluted) or a decrease of $16.2 million, or 11.6
percent, compared to the prior year-end net operating income of
$139.6 million or $3.11 per share ($3.07 diluted).
“2015 was a year of change for UMB, with an increased focus on
maximizing efficiencies” said Mariner Kemper, chairman and chief
executive officer. “Total loan balances increased 26.3 percent from
December 31, 2014 to December 31, 2015. Loans produced by legacy
UMB lenders increased 13.2 percent during that period, once again
outpacing industry averages. During the year, we implemented
several organizational changes, and while we have faced some
headwinds, we have a lot to be excited about. We have a
long-standing track record of strong loan and deposit growth, and
our focus on improving metrics will push more of that momentum to
the bottom line.”
Net Interest Income and Margin for the
Fourth Quarter 2015
Net interest income for the fourth quarter of 2015 increased
$23.5 million, or 25.9 percent, compared to the same period in
2014. Net interest margin increased 24 basis points to 2.76 percent
for the three months ended December 31, 2015, compared to the same
period in 2014.
Average earning assets increased $2.2 billion, or 14.7 percent,
compared to the fourth quarter of 2014. This increase was largely
due to an increase in average loans of $1.9 billion, or 25.7
percent, and an increase in average total securities, including
trading securities, of $217.6 million, or 3.0 percent. The
acquisition of Marquette Financial Companies (Marquette) added
earning assets with an acquired value of $1.3 billion on May 31,
2015. Acquired Marquette loans and loans originated through the
legacy Marquette channels had an actual balance at December 31,
2015 of $1.0 billion.
Noninterest Income and Expense for the
Fourth Quarter 2015
Noninterest income decreased $2.6 million, or 2.3 percent, for
the three months ended December 31, 2015, compared to the same
period in 2014. This decrease is primarily attributable to a
decrease in trust and securities processing income of $6.9 million,
or 10.0 percent, driven by a $7.9 million, or 41.6 percent,
decrease in advisory fee income from the Scout Funds. Equity
earnings on alternative investments had an unrealized loss of $5.2
million at December 31, 2015 compared to an unrealized loss of $4.5
million at December 31, 2014. This is a year-over-year change of
$0.7 million, or 15.6 percent. Gains on sales of securities
increased $1.9 million, and other noninterest income increased $1.5
million, compared to the same period in 2014. The increase in other
noninterest income was driven by $1.8 million of income generated
from bank-owned life insurance investments purchased in 2015.
Noninterest expense increased $15.7 million, or 9.4 percent, for
the three months ended December 31, 2015, compared to the same
period in 2014. Salaries and employee benefits expense increased
$13.5 million, or 15.0 percent, compared to the same period in
2014,due to an increase in salaries and wages of $8.0 million, or
13.8 percent, an increase in bonus and commission expense of $4.0
million, or 20.6 percent, and an increase in employee benefits
expense of $1.5 million, or 11.9 percent. Included in the increase
of salaries and employee benefits is $9.0 million of Marquette
salaries and benefits, including $0.6 million in Marquette-related
severance, and $3.3 million of non-Marquette severance.
Equipment expense increased $2.1 million, or 14.4 percent,
compared to the same period in 2014, due to increased computer and
hardware costs related to investments for regulatory requirements,
cyber security and the ongoing modernization of our core systems.
Occupancy expenses increased $1.5 million, or 14.3 percent, and
other noninterest expense increased $1.5 million, or 29.8 percent,
compared to the same period in 2014. The increase in other
noninterest expense was driven by a $1.3 million increase in fair
value adjustments on contingent consideration for acquisitions.
Supplies and postage decreased $1.1 million, or 20.8 percent, and
bankcard expenses decreased $1.5 million, or 22.2 percent, compared
to the same period in 2014.
Total acquisition expenses recognized in noninterest expense
during the fourth quarter of 2015 totaled $3.4 million primarily
related to $0.6 million of severance expense included in salaries
and employee benefits and $2.0 million of consulting expense
related to core system conversions projects. Total acquisition
expenses for the same period in 2014 were $1.9 million, or a
comparable quarterly period increase of $1.5 million or 76.5
percent.
Balance Sheet for the Fourth Quarter
2015
Average total assets for the three months ended December 31,
2015 were $18.8 billion compared to $16.2 billion for the same
period in 2014, an increase of $2.5 billion, or 15.6 percent.
Average earning assets increased $2.2 billion for the period, or
14.7 percent.
Average loan balances for the three months ended December 31,
2015, increased $1.9 billion, or 25.7 percent, to $9.2 billion
compared to the same period in 2014. Actual loan balances on
December 31, 2015, were $9.4 billion, an increase of $2.0 billion,
or 26.3 percent, compared to December 31, 2014. The overall actual
loan increase at December 31, 2015 was driven by a $796.5 million,
or 42.7 percent, increase in commercial real estate loans, a $391.7
million, or 10.3 percent, increase in commercial loans, a $219.2
million, or 100.0 percent, increase in asset-based loans, a $172.4
million, or 53.9 percent, increase in residential real estate
loans, a $160.6 million, or 62.7 percent, increase in construction
real estate loans, and a $90.7 million, or 100.0 percent, increase
in factoring loans.
A significant driver in the increase in loans was the
acquisition of Marquette and its loan portfolio. These acquired
Marquette loans and loans originated through the legacy Marquette
channels had an actual balance at December 31, 2015 of $1.0
billion. This total includes $325.2 million in commercial real
estate loans, $219.2 million in asset-based loans, $111.8 million
in construction real estate loans, $90.7 million in factoring
loans, $99.6 million in commercial loans, and $99.4 million in
residential real estate loans. The remaining increase in loans of
$1.0 billion compared to December 31, 2014 is comprised of loans
originated through the legacy UMB channels. This increase was
primarily driven by an increase in commercial real estate loans of
$471.3 million and an increase in commercial loans of $292.1
million.
Nonperforming loans increased to $61.2 million on December 31,
2015, from $27.4 million on December 31, 2014. Nonperforming loans
are defined as nonaccrual loans and restructured loans. As a
percentage of loans, nonperforming loans increased to 0.65 percent
at December 31, 2015, compared to 0.37 percent on December 31,
2014. The company’s allowance for loan losses totaled $81.1
million, or 0.86 percent of loans, at December 31, 2015, compared
to $76.1 million, or 1.02 percent of loans, at December 31,
2014.
For the three months ended December 31, 2015, average
securities, including trading securities, totaled $7.4 billion.
This is an increase of $217.6 million, or 3.0 percent, from the
same period in 2014.
Average total deposits increased $2.4 billion, or 18.8 percent,
to $15.3 billion for the three months ended December 31, 2015,
compared to the same period in 2014. Deposit balances from the
legacy Marquette channels totaled $798.6 million at December 31,
2015.
Average noninterest-bearing demand deposits increased $1.3
billion, or 24.6 percent, compared to the same period in 2014.
Average interest-bearing deposits increased $1.1 billion, or 14.5
percent, compared to the same period in 2014. Total actual deposits
as of December 31, 2015, were $15.1 billion, compared to $13.6
billion as of December 31, 2014, a 10.8 percent increase.
Additionally, for the three months ended December 31, 2015, average
noninterest-bearing demand deposits were 44.1 percent of average
total deposits.
As of December 31, 2015, UMB had total shareholders’ equity of
$1.9 billion, an increase of 15.2 percent compared to December 31,
2014. This increase is primarily attributable to the common stock
issuance associated with the acquisition of Marquette of $179.7
million at May 31, 2015.
Year Ended December 31,
2015
Earnings for the year ended December 31, 2015, were $116.1
million or $2.46 per share ($2.44 diluted). This is a decrease of
$4.6 million, or 3.8 percent, compared to the prior year-end
earnings of $120.7 million or $2.69 per share ($2.65 diluted).
Net interest income for the year ended December 31, 2015,
increased $62.0 million, or 17.7 percent, compared to the same
period in 2014. Average earning assets increased $1.6 billion, or
10.6 percent, compared to the same period in 2014. This increase
was due primarily to a $1.4 billion, or 20.8 percent, increase in
average loans. Net interest margin increased 15 basis points to
2.64 percent, compared to the same period in 2014.
Noninterest income decreased $32.2 million, or 6.5 percent, to
$466.5 million for the year ended December 31, 2015, compared to
the same period in 2014. The decrease in noninterest income was
primarily driven by decreased trust and securities processing
income of $26.0 million, or 9.0 percent. The decrease in trust and
securities processing income was primarily due to a $35.6 million,
or 38.9 percent, decrease in advisory fee income from the Scout
Funds, partially offset by a $5.3 million, or 5.5 percent, increase
in fees related to institutional and personal investment management
services, and a $2.9 million, or 3.3 percent, increase in fund
administration and custody services. Equity earnings on alternative
investments had an unrealized loss of $12.2 million at December 31,
2015 compared to an unrealized gain of $4.0 million at December 31,
2014, resulting in a year-over-year decrease of $16.2 million.
These decreases in noninterest income were partially offset by an
increase in gains on sales of securities of $6.3 million for the
year ended December 31, 2015 compared to December 31, 2014.
Noninterest expense increased $38.1 million, or 5.7 percent, for
the year ended December 31, 2015, compared to the same period in
2014. This increase was driven by an increase in salaries and
employee benefits expense of $47.9 million, or 13.4 percent, an
increase in equipment expense of $9.9 million, or 18.5 percent, and
an increase in legal and consulting expense of $6.0 million, or
29.3 percent. These increases were partially offset by a $20.3
million contingency reserve recorded for the year ended December
31, 2014. Marquette salaries and employee benefits expense,
including $2.4 million of Marquette-related severance, totaled
$23.2 million and non-Marquette severance totaled $4.6 million for
the year ended December 31, 2015.
Total acquisition expenses recognized in noninterest expense
were $9.8 million during the year-ended December 31, 2015, compared
to $1.9 million during the year-ended December 31, 2014.
Efficiency Initiatives
In 2015, the company announced efficiency initiatives with cost
savings expected to be recognized as follows: $6.8 million in 2015,
$22.6 million in 2016, and annualized savings of $32.9 million in
2017 and beyond. As an update, we recognized $9.5 million of these
cost savings in 2015 and now expect to recognize $21.1 million in
2016 and annualized savings of $32.9 million beginning in 2017.
Dividend Declaration
At the company’s quarterly board meeting, the Board of Directors
declared a $0.245 per share quarterly cash dividend, payable on
April 1, 2016, to shareholders of record at the close of business
on March 10, 2016.
Conference Call
The company plans to host a conference call to discuss its 2015
fourth quarter and full-year 2015 earnings results on January 27,
2016 at 8:30 a.m. (CT). Interested parties may access the call by
dialing (toll-free) 877-267-8760 or (U.S.) 412-542-4148 and
requesting to join the UMB Financial call. The live call can also
be accessed by visiting the investor relations area of
umbfinancial.com or by using the following the link:
UMB Financial 4Q 2015 Conference Call
A replay of the conference call may be heard through February
10, 2016, by calling (toll-free) 877-344-7529 or (U.S.)
412-317-0088. The replay pass code required for playback is
10078224. The call replay may also be accessed via the company's
website umbfinancial.com by visiting the investor relations
area.
Non-GAAP Financial
Information
In this release, we provide information using net operating
income, operating earnings per share (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
(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 comparable GAAP financial measures are
reconciled later in this release. The company believes that these
non-GAAP financial measures and the reconciliations may be useful
to investors because they adjust for acquisition- and
severance-related items 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 after-tax impact of excluding
the following: (i) the contingency reserve expense related to the
acquisition of Prairie Capital Management, LLC, (ii) fair value
adjustments to contingent consideration for the acquisitions of
Prairie Capital Management, LLC and Reams Asset Management Company,
(iii) expenses related to the acquisition of Marquette Financial
Companies, and (iv) non-acquisition severance expense. Operating
EPS (basic and diluted) is calculated as net operating income,
divided by the company’s average number of shares outstanding
(basic and diluted) for the relevant period. Operating ROE is
calculated as net operating income, divided by the company’s
average total shareholders’ equity for the relevant period.
Operating ROA is calculated as net operating income, divided by the
company’s average assets for the relevant period. Operating
noninterest expense for the relevant period is defined as GAAP
noninterest expense, adjusted to reflect the pre-tax impact of
non-GAAP adjustments described in clauses i-iv above. Operating
efficiency ratio is calculated as the company’s operating
noninterest expense, less amortization of other intangibles,
divided by the company’s tax equivalent net interest income plus
noninterest income less gains on sales of securities available for
sale.
Forward-Looking
Statements:
This 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—such as our statements about expected
cost savings and other results of efficiency initiatives and our
statements about asset sensitivity. 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, 2014, 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 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. 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 diversified
financial holding company headquartered in Kansas City, Mo.,
offering complete banking services, payment solutions, asset
servicing and institutional investment management to customers. UMB
operates banking and wealth management centers throughout Missouri,
Illinois, Colorado, Kansas, Oklahoma, Nebraska, Arizona and Texas,
as well as two national specialty-lending businesses. Subsidiaries
of the holding company include companies that offer services to
mutual funds and alternative-investment entities and registered
investment advisors that offer equity and fixed income strategies
to institutions and individual investors. For more information,
visit umb.com, umbfinancial.com, blog.umb.com or follow us on
Twitter at @UMBBank, Facebook at facebook.com/UMBBank and LinkedIn
at linkedin.com/company/umb-bank.
Non-GAAP Financial Measures UMB Financial
Corporation Net operating income non-GAAP
reconciliation: (unaudited, dollars in thousands, except per
share data)
Three Months Ended Year Ended December 31,
December 31, 2015
2014 2015
2014 Net income (GAAP) $ 29,643 $ 26,940 $ 116,073 $
120,655
Adjustments (net of tax): Contingency reserve
expense (i) - - - 12,974 Fair value adjustments on contingent
consideration (ii) 300 (543) (1,925) 4,264 Acquisition expenses
(iii) 2,193 1,243 6,293 1,243 Non-acquisition severance expense
(iv) 2,098 181
2,919 465 Total Non-GAAP adjustments (net of
tax) 4,591 881
7,287 18,946
Net operating income
(Non-GAAP) $ 34,234 $ 27,821 $
123,360 $ 139,601
GAAP
Earnings per share - Basic $ 0.61 $ 0.60 $ 2.46 $ 2.69 Earnings per
share - Diluted 0.60 0.59 2.44 2.65 Return on average assets 0.63%
0.66% 0.65% 0.75% Return on average equity 6.15% 6.47% 6.43% 7.54%
Non-GAAP
Operating earnings per share - Basic $ 0.70 $ 0.62 $ 2.62 $ 3.11
Operating earnings per share - Diluted 0.70 0.61 2.59 3.07
Operating return on average assets 0.72% 0.68% 0.69% 0.87%
Operating return on average equity 7.10% 6.68% 6.83% 8.73%
Operating noninterest expense and operating efficiency
ratio non-GAAP reconciliation: (unaudited, dollars in
thousands)
Three Months Ended
Year Ended
December 31,
December 31,
December 31,
December 31,
2015
2014 2015
2014 Noninterest expense (GAAP) $
182,080 $ 166,397 $ 703,736 $ 665,680 Adjustments
(pre-tax): Contingency reserve expense (i) - - - 20,272 Fair value
adjustments on contingent consideration (ii) 469 (848) (3,008)
6,662 Acquisition expenses (iii) 3,427 1,942 9,833 1,942
Non-acquisition severance expense (iv) 3,278
282 4,561 726
Total Non-GAAP adjustments (pre-tax) 7,174
1,376 11,386
29,602 Operating noninterest expense 174,906
165,021 692,350
636,078 Noninterest expense 182,080 166,397 703,736 665,680
Less: Amortization of other intangibles 3,283
2,974 12,090
12,193 Noninterest expense, net of amortization of other
intangibles (numerator A) 178,797
163,423 691,646 653,487
Operating noninterest expense (Non-GAAP) 174,906 165,021
692,350 636,078 Less: Amortization of other intangibles
3,283 2,974 12,090
12,193 Operating expense, net of amortization of
other intangibles (numerator B) 171,623
162,047 680,260 623,885
Net interest income (tax equivalent) (v) 120,966 96,200
435,852 371,289 Noninterest income 112,599 115,248 466,454 498,688
Less: Gains on sales of securities available for sale, net
1,998 62 10,402
4,127 Total (denominator A) 231,567
211,386 891,904
865,850 Efficiency ratio (numerator A/denominator A)
77.21% 77.31% 77.55% 75.47% Operating efficiency ratio (numerator
B/denominator A) 74.11% 76.66% 76.27% 72.05% (i) Represents the
company's 2014 contingency reserve for the settlement of disputes
related to the acquisition of Prairie Capital Management, LLC
(PCM). (ii) Represents fair value adjustments to contingent
consideration for the acquisitions of PCM and Reams Asset
Management Company. (iii) Represents expenses related to the
acquisition of Marquette Financial Companies (MFC). (iv) Represents
non-acquisition severance expense related to UMB-legacy employees.
Severance expense for MFC-legacy employees is included in item
(iii). (v) Tax-exempt interest income has been adjusted to a tax
equivalent basis. The amount of such adjustment was an addition to
net interest income of $6.5 million and $5.3 million for the three
months ended December 31, 2015 and 2014, respectively, and an
addition to net interest income of $23.8 million and $21.2 million
for the year-ended December 31, 2015 and 2014, respectively.
Consolidated Balance Sheets
UMB Financial Corporation (unaudited, dollars in
thousands)
December 31,
Assets
2015 2014 Loans $
9,430,761 $ 7,465,794 Allowance for loan losses (81,143)
(76,140) Net loans 9,349,618
7,389,654 Loans held for sale 589 624 Investment
securities: Available for sale 6,806,949 6,911,936 Held to maturity
667,106 278,054 Trading securities 29,617 27,203 Other securities
65,198 68,474 Total investment
securities 7,568,870 7,285,667 Federal
funds and resell agreements 173,627 118,105 Interest-bearing due
from banks 522,877 1,539,386 Cash and due from banks 458,217
444,299 Bank premises and equipment, net 281,471 257,835 Accrued
income 90,127 79,297 Goodwill 228,346 209,758 Other intangibles
46,782 43,991 Other assets 373,721
132,344 Total assets $ 19,094,245 $ 17,500,960
Liabilities
Deposits: Noninterest-bearing demand $ 6,306,895 $ 5,643,989
Interest-bearing demand and savings 7,529,972 6,709,281 Time
deposits under $250,000 771,973 636,507 Time deposits of $250,000
or more 483,912 627,082 Total deposits
15,092,752 13,616,859 Federal funds and
repurchase agreements 1,818,062 2,025,132 Short-term debt 5,009 -
Long-term debt 86,070 8,810 Accrued expenses and taxes 161,245
180,074 Other liabilities 37,413 26,327
Total liabilities 17,200,551 15,857,202
Shareholders'
Equity
Common stock 55,057 55,057 Capital surplus 1,019,889 894,602
Retained earnings 1,033,990 963,911 Accumulated other comprehensive
(loss) income (3,718) 11,006 Treasury stock (211,524)
(280,818) Total shareholders' equity 1,893,694
1,643,758 Total liabilities and shareholders'
equity $ 19,094,245 $ 17,500,960
Consolidated Statements of
Income UMB Financial
Corporation (unaudited, dollars in thousands except share and
per share data)
Three Months Ended
Year Ended December 31, December 31,
Interest
Income
2015 2014
2015 2014 Loans $ 88,011
$ 64,433 $ 308,325 $ 245,278 Securities: Taxable interest 18,858
19,338 75,327 76,204 Tax-exempt interest 11,756
9,759 43,598
39,209 Total securities income 30,614 29,097 118,925 115,413
Federal funds and resell agreements 320 93 697 259 Interest-bearing
due from banks 595 510 2,356 2,525 Trading securities 75
85 378 396
Total interest income 119,615 94,218
430,681 363,871
Interest
Expense
Deposits 3,836 3,076 14,269 12,242 Federal funds and repurchase
agreements 396 323 1,785 1,616 Other 929 (95)
2,560 (42) Total interest
expense 5,161 3,304
18,614 13,816 Net interest income 114,454
90,914 412,067 350,055 Provision for loan losses 5,000
3,000 15,500
17,000 Net interest income after provision for loan losses
109,454 87,914 396,567
333,055
Noninterest
Income
Trust and securities processing 62,194 69,072 262,056 288,054
Trading and investment banking 5,559 4,840 20,218 19,398 Service
charges on deposits 21,631 21,480 86,460 85,299 Insurance fees and
commissions 894 765 2,530 3,011 Brokerage fees 3,005 2,595 11,753
10,761 Bankcard fees 17,369 17,321 69,211 67,250 Gains on sale of
securities available for sale, net 1,998 62 10,402 4,127 Equity
(loss) earnings on alternative investments (5,189) (4,487) (12,188)
3,975 Other 5,138 3,600
16,012 16,813 Total noninterest income 112,599
115,248 466,454
498,688
Noninterest
Expense
Salaries and employee benefits 103,617 90,115 406,472 358,569
Occupancy, net 11,791 10,312 43,861 40,197 Equipment 16,723 14,618
63,533 53,609 Supplies, postage and telephone 4,280 5,403 18,579
20,411 Marketing and business development 6,816 7,182 23,730 24,148
Processing fees 13,096 13,496 51,328 56,049 Legal and consulting
7,447 7,907 26,390 20,407 Bankcard 5,301 6,812 20,288 19,594
Amortization of other intangibles 3,283 2,974 12,090 12,193
Regulatory fees 3,320 2,643 12,125 10,445 Contingency reserve - - -
20,272 Other 6,406 4,935
25,340 29,786 Total noninterest expense
182,080 166,397 703,736 665,680 Income before income taxes
39,973 36,765 159,285 166,063 Income tax provision 10,330
9,825 43,212
45,408
Net income $ 29,643 $ 26,940
$ 116,073 $ 120,655
Per Share
Data
Net income - basic $ 0.61 $ 0.60 $ 2.46 $ 2.69 Net income – diluted
0.60 0.59 2.44 2.65 Dividends 0.245 0.235 0.950 0.910 Weighted
average shares outstanding - basic 48,630,195 44,920,106 47,126,252
44,844,578 Weighted average shares outstanding - diluted 49,066,566
45,465,760 47,579,334 45,445,283
Consolidated Statements
of Comprehensive (Loss) Income UMB Financial
Corporation
(unaudited, dollars in thousands)
Three Months EndedDecember
31,
Year EndedDecember 31,
2015 2014 2015
2014 Net Income $ 29,643 $
26,940 $ 116,073 $ 120,655 Other comprehensive (loss) income, net
of tax: Unrealized (losses) gains on securities: Change in
unrealized holding (losses) gains, net (46,682) 14,991 (13,393)
74,147 Less: Reclassifications adjustment for gains included in net
income (1,998) (62)
(10,402) (4,127) Net unrealized holding
(losses) gains (48,680) 14,929 (23,795) 70,020 Change in unrealized
losses on derivatives (10) -
(10) - Income tax benefit
(expense) 18,442 (5,750)
9,081 (26,374) Other comprehensive
(loss) income (30,248) 9,179
(14,724) 43,646 Comprehensive
(loss) income $ (605) $ 36,119 $
101,349 $ 164,301
Consolidated Statements of
Shareholders' Equity
UMB Financial Corporation (unaudited, dollars
in thousands, except per share data)
Accumulated Other Common Capital
Retained Comprehensive Treasury
Stock Surplus
Earnings (Loss) Income
Stock Total Balance - January 1, 2014 $
55,057 $ 882,407 $ 884,630 $ (32,640) $ (283,389) $ 1,506,065 Total
comprehensive income - - 120,655 43,646 - 164,301 Cash dividends
($0.91 per share) - - (41,374) - - (41,374) Purchase of treasury
stock - - - - (5,741) (5,741) Issuance of equity awards - (2,338) -
- 2,827 489 Recognition of equity based compensation - 9,172 - - -
9,172 Net tax benefit related to equity compensation plans - 1,880
- - - 1,880 Sale of treasury stock - 596 - - 340 936 Exercise of
stock options - 2,885 -
- 5,145 8,030 Balance – December
31, 2014 $ 55,057 $ 894,602 $ 963,911 $ 11,006
$ (280,818) $ 1,643,758 Balance - January 1,
2015 $ 55,057 $ 894,602 $ 963,911 $ 11,006 $ (280,818) $ 1,643,758
Total comprehensive income - - 116,073 (14,724) - 101,349 Cash
dividends ($0.95 per share) - - (45,994) - - (45,994) Purchase of
treasury stock - - - - (8,457) (8,457) Issuance of equity awards -
(3,278) - - 3,737 459 Recognition of equity based compensation -
10,292 - - - 10,292 Net tax benefit related to equity compensation
plans - 944 - - - 944 Sale of treasury stock - 611 - - 445 1,056
Exercise of stock options - 4,083 - - 6,467 10,550 Common stock
issuance for
Acquisition
- 112,635 - -
67,102 179,737 Balance – December 31,
2015 $ 55,057 $ 1,019,889 $ 1,033,990 $
(3,718) $ (211,524) $ 1,893,694
Average Balances / Yields and Rates
UMB Financial
Corporation (tax - equivalent basis)
(unaudited, dollars in thousands)
Three Months
Ended December 31, 2015
2014 Average Average Average
Average
Assets
Balance Yield/Rate
Balance Yield/Rate
Loans, net of unearned interest $ 9,199,961 3.80 % $ 7,320,930 3.49
% Securities: Taxable 4,704,102 1.59 5,006,800 1.53 Tax-exempt
2,670,130 2.71 2,148,256 2.77 Total
securities 7,374,232 2.00 7,155,056 1.91 Federal funds and resell
agreements 117,005 1.09 73,821 0.50 Interest-bearing due from banks
662,036 0.36 571,921 0.35 Trading securities 27,439
1.29 29,019 1.46 Total earning assets 17,380,673 2.88
15,150,747 2.61 Allowance for loan losses (78,906) (77,527) Other
assets 1,453,790 1,158,402 Total assets $ 18,755,557
$ 16,231,622
Liabilities and
Shareholders' Equity
Interest-bearing deposits $ 8,528,207 0.18 % $ 7,446,164 0.16 %
Federal funds and repurchase agreements 1,305,939 0.12 1,535,253
0.08 Borrowed funds 88,862 4.15 7,021 (5.37) Total interest-bearing
liabilities 9,923,008 0.21 8,988,438 0.15 Noninterest-bearing
demand deposits 6,734,309 5,403,856 Other liabilities 185,586
187,359 Shareholders' equity 1,912,654 1,651,969
Total liabilities and shareholders' equity $ 18,755,557 $
16,231,622 Net interest spread 2.67 % 2.46 % Net interest margin
2.76 2.52
Year Ended December 31,
2015 2014 Average
Average Average Average
Assets
Balance Yield/Rate
Balance Yield/Rate
Loans, net of unearned interest $ 8,425,107 3.66 % $ 6,975,338 3.52
% Securities: Taxable 4,823,710 1.56 4,898,826 1.56 Tax-exempt
2,473,811 2.72 2,122,822 2.84 Total
securities 7,297,521 1.95 7,021,648 1.94 Federal funds and resell
agreements 76,108 0.92 48,869 0.53 Interest-bearing due from banks
664,752 0.35 843,134 0.30 Trading securities 32,725
1.46 32,189 1.46 Total earning assets 16,496,213 2.75
14,921,178 2.58 Allowance for loan losses (77,899) (76,459) Other
assets 1,368,128 1,154,174 Total assets $ 17,786,442
$ 15,998,893
Liabilities and
Shareholders' Equity
Interest-bearing deposits $ 8,150,588 0.18 % $ 7,494,744 0.16 %
Federal funds and repurchase agreements 1,590,776 0.11 1,535,038
0.11 Borrowed funds 59,174 4.33 6,059
(0.69) Total interest-bearing liabilities 9,800,538 0.19 9,035,841
0.15 Noninterest-bearing demand deposits 5,927,702 5,196,529 Other
liabilities 252,346 166,758 Shareholders' equity 1,805,856
1,599,765 Total liabilities and shareholders' equity $
17,786,442 $ 15,998,893 Net interest spread 2.56 % 2.43 % Net
interest margin 2.64 2.49
FOURTH QUARTER 2015 FINANCIAL HIGHLIGHTS
UMB Financial Corporation (unaudited, dollars
in thousands, except share and per share data)
Year Ended
December 31 2015
2014 Net interest income $ 412,067 $ 350,055
Provision for loan losses 15,500 17,000 Noninterest income 466,454
498,688 Noninterest expense 703,736 665,680 Income before income
taxes 159,285 166,063 Net income 116,073 120,655 Net income per
share - Basic 2.46 2.69 Net income per share - Diluted 2.44 2.65
Return on average assets 0.65 % 0.75 % Return on average equity
6.43 % 7.54 %
Three Months Ended December 31 Net
interest income $ 114,454 $ 90,914 Provision for loan losses 5,000
3,000 Noninterest income 112,599 115,248 Noninterest expense
182,080 166,397 Income before income taxes 39,973 36,765 Net income
29,643 26,940 Net income per share - Basic 0.61 0.60 Net income per
share - Diluted 0.60 0.59 Return on average assets 0.63 % 0.66 %
Return on average equity 6.15 % 6.47 %
At December 31
Assets $ 19,094,245 $ 17,500,960 Loans, net of unearned interest
9,430,761 7,465,794 Securities 7,568,870 7,285,667 Deposits
15,092,752 13,616,859 Shareholders' equity 1,893,694 1,643,758 Book
value per share 38.34 36.10 Market price per share 46.55 56.89
Equity to assets 9.92 % 9.39 % Allowance for loan losses $ 81,143 $
76,140 As a % of loans 0.86 % 1.02 % Nonaccrual and restructured
loans $ 61,152 $ 27,382 As a % of loans 0.65 % 0.37 % Loans over 90
days past due $ 7,324 $ 3,830 As a % of loans 0.08 % 0.05 % Other
real estate owned $ 3,307 $ 394 Net loan charge-offs
quarter-to-date $ 1,886 $ 4,176 As a % of average loans 0.08 % 0.23
% Net loan charge-offs year-to-date $ 10,497 $ 15,610 As a % of
average loans 0.12 % 0.22 % Common shares outstanding
49,396,366 45,532,188
Average Balances Year Ended
December 31 Assets $ 17,786,442 $ 15,998,893 Loans, net of
unearned interest 8,425,107 6,975,338 Securities 7,330,246
7,053,837 Deposits 14,078,290 12,691,273 Shareholders' equity
1,805,856 1,599,765
Business Segment Information
UMB Financial Corporation (unaudited, dollars in thousands)
Three Months Ended December 31, 2015
Bank
PaymentSolutions
InstitutionalInvestmentManagement
AssetServicing
Total Net interest income $ 96,658 $
16,028 $ - $ 1,768 $ 114,454 Provision for loan
losses 2,997 2,003 - - 5,000 Noninterest income 46,400 22,802
20,880 22,517 112,599 Noninterest expense 116,710
27,887 18,636 18,847
182,080 Income before taxes 23,351 8,940 2,244 5,438 39,973
Income tax expense 6,016 2,325
583 1,406 10,330 Net income $ 17,335
$ 6,615 $ 1,661 $ 4,032 $ 29,643
Average assets $ 14,494,000 $ 3,183,000 $ 64,000 $ 1,015,000 $
18,756,000
Three Months Ended December 31,
2014 Bank
PaymentSolutions
InstitutionalInvestmentManagement
AssetServicing
Total Net interest income $ 75,861 $ 14,003 $
1 $ 1,049 $ 90,914 Provision for loan losses 1,617 1,383 - - 3,000
Noninterest income 42,380 21,479 29,212 22,177 115,248 Noninterest
expense 96,803 26,473 23,183
19,938 166,397 Income before taxes
19,821 7,626 6,030 3,288 36,765 Income tax expense 5,427
1,967
1,559 872 9,825 Net
income $ 14,394 $ 5,659 $ 4,471 $ 2,416
$ 26,940 Average assets $ 12,323,000 $ 2,949,000 $ 72,000 $
888,000 $ 16,232,000
Year Ended December
31, 2015
Bank
PaymentSolutions
InstitutionalInvestmentManagement
AssetServicing
Total Net interest income $ 348,701 $
58,288 $ 2 $ 5,076 $ 412,067 Provision for
loan losses 8,541 6,959 - - 15,500 Noninterest income 188,444
91,326 95,097 91,587 466,454 Noninterest expense 446,656
106,016 71,413 79,651
703,736 Income before taxes 81,948 36,639 23,686
17,012 159,285 Income tax expense 22,127
10,043 6,490 4,552 43,212
Net income $ 59,821 $ 26,596 $ 17,196 $ 12,460
$ 116,073 Average assets $ 13,706,000 $ 3,044,000 $
68,000 $ 968,000 $ 17,786,000
Year Ended December 31,
2014 Bank
PaymentSolutions
InstitutionalInvestmentManagement
AssetServicing
Total Net interest income $ 292,356 $ 52,251 $
(3) $ 5,451 $ 350,055 Provision for loan losses 9,175 7,825 - -
17,000 Noninterest income 194,223 84,478 131,225 88,762 498,688
Noninterest expense 404,203 93,915
92,048 75,514 665,680 Income
before taxes 73,201 34,989 39,174 18,699 166,063 Income tax expense
24,095 7,791 10,093
3,429 45,408 Net income $ 49,106 $
27,198 $ 29,081 $ 15,270 $ 120,655
Average assets $ 12,099,000 $ 2,456,000 $ 72,000 $ 1,372,000 $
15,999,000
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UMB Financial CorporationKelli Christman,
816-916-3240
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