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UMB Financial Corporation Reports Second Quarter 2015 Earnings of $30.2 million, or $0.65 per Diluted Share

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KANSAS CITY, Mo.--(BUSINESS WIRE)--

UMB Financial Corporation (Nasdaq: UMBF), a diversified financial holding company, announced earnings for the three months ended June 30, 2015 of $30.2 million or $0.65 per share ($0.65 diluted). This is a decrease of $4.5 million, or 12.9 percent, compared to second quarter 2014 earnings of $34.7 million or $0.77 per share ($0.76 diluted). Earnings for the six months ended June 30, 2015, were $64.0 million or $1.40 per share ($1.39 diluted). This is an increase of $5.9 million, or 10.1 percent, compared to the earnings for the six months ended June 30, 2014 of $58.1 million or $1.30 per share ($1.28 diluted).

On May 31, 2015, the company completed its previously announced acquisition of Marquette Financial Companies (Marquette). This acquisition resulted in assets with an acquired value of $1.3 billion being added to the company's balance sheet on that date.

"The highlight of the second quarter was closing on our acquisition of Marquette Financial Companies," said Mariner Kemper, Chairman and Chief Executive Officer. "The combination is already producing positive results, helping drive a $2.0 billion, or 28.8 percent, end-of-period increase in total loan balances compared to the second quarter of 2014. At June 30, the acquired loans plus production in the legacy Marquette channels comprised $1.0 billion of the increase in total loan balances. The remaining increase of $1.0 billion was generated by legacy UMB lenders, for a year-over-year increase of 14.4 percent, and a linked-quarter increase of 5.6 percent. This is a testament to the strength of our commercial-lending franchise.

"While we experienced solid net-interest-income growth in the second quarter, noninterest income contracted, primarily due to continued revenue headwinds from Scout Investments. To address ongoing revenue and expense pressures, we remain focused on revenue growth but have increased attention on our expense structure as well. In the second quarter, we consolidated several customer-facing lines of business—primarily in the bank—to more efficiently deliver our customer-service strategy. Additionally, we reorganized our technology, operations, and related support groups. These and related actions are a strategic first step to improve our efficiency ratio and are expected to provide an annualized cost savings of approximately $3.6 million. We have already begun to engage in additional planning and are committed to sharing details later in 2015."

Net Interest Income and Margin

Net interest income for the second quarter of 2015 increased $11.2 million, or 13.0 percent, compared to the same period in 2014. Average earning assets increased $1.4 billion, or 10.0 percent, compared to the second quarter of 2014. This increase was primarily due to a $1.2 billion, or 17.0 percent, increase in average loans. Marquette added earning assets with an acquired value of $1.3 billion including loan balances with an acquired value of $980.3 million on May 31, 2015. Net interest margin increased six basis points to 2.59 percent for the three months ended June 30, 2015, compared to the same quarter in 2014.

Noninterest Income and Expense

Noninterest income decreased $14.5 million, or 10.8 percent, for the three months ended June 30, 2015, compared to the same period in 2014. This decrease is largely attributable to decreased trust and securities processing income of $6.0 million, or 8.1 percent, for the three months ended June 30, 2015, compared to the same period in 2014. This decrease in trust and securities processing income was primarily due to an $8.5 million, or 34.9 percent, decrease in advisory fee income from the Scout Funds. This decrease was offset by an increase in fees related to institutional and personal investment management services of $1.5 million, or 6.6 percent, an increase in fund administration and custody services of $0.5 million, or 2.2 percent, and an increase in corporate trust fees of $0.5 million, or 15.8 percent. Equity earnings on alternative investments decreased $4.6 million due to a decline in unrealized gains on Prairie Capital Management (PCM) equity method investments for the three months ended June 30, 2015, compared to the same period in 2014. Other noninterest income decreased $3.0 million primarily driven by a gain on the sale of a branch property of $2.8 million that was recorded in the second quarter of 2014.

Noninterest expense increased $5.8 million, or 3.5 percent, for the three months ended June 30, 2015, compared to the same period in 2014. Salary and benefits expense increased $10.1 million, or 11.2 percent, due to increases in salaries and wages of $7.4 million, or 13.4 percent, a $1.9 million, or 9.9 percent, increase in commissions and bonuses, and a $0.8 million, or 5.0 percent, increase in employee benefits expense. The acquisition of Marquette added approximately $3.4 million of salary and benefits expense for the second quarter of 2015. Equipment expense increased $2.5 million, or 19.3 percent, due to increased computer and hardware costs related to investments for regulatory requirements, cyber security and the ongoing modernization of our core systems. These increases were offset by a decrease in processing fees of $2.2 million, or 14.6 percent, due to decreased fees paid by the advisor to distributors of the Scout Funds. The second quarter of 2014 included an additional $5.3 million of contingency reserve expense related to the earn-out amount and related incentive bonus compensation for the employees of PCM that was not repeated in the second quarter of 2015. Total acquisition expenses recognized in noninterest expense during the second quarter totaled $0.7 million.

Balance Sheet

Average total assets for the three months ended June 30, 2015 were $17.4 billion compared to $15.6 billion for the same period in 2014, an increase of $1.8 billion, or 11.5 percent. Average earning assets increased by $1.4 billion for the period, or 10.0 percent.

Average loan balances for the three months ended June 30, 2015, increased $1.2 billion, or 17.0 percent, to $8.1 billion compared to the same period in 2014. Actual loan balances on June 30, 2015, were $8.9 billion, an increase of $2.0 billion, or 28.8 percent, compared to June 30, 2014. The overall actual loan increase at June 30, 2015 was driven by an increase in commercial real estate loans of $658.2 million, or 38.1 percent, a $593.3 million, or 16.8 percent, increase in commercial loans, a $211.3 million, or 100.0 percent, increase in asset-based loans, a $163.9 million, or 70.7 percent, increase in construction real estate loans, a $134.2 million, or 44.9 percent, increase in residential real estate loans, and a $109.2 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 with an acquired value of $980.3 million at May 31, 2015. These acquired Marquette loans and loans originated through the legacy Marquette channels had an actual balance at June 30, 2015 of $1.0 billion. This total includes $343.4 million in commercial real estate loans, $211.3 million in asset-based loans, $109.2 million in factoring loans, $105.7 million in commercial loans, and $98.3 million in residential real estate loans. The remaining increase in loans of $1.0 billion compared to June 30, 2014 is comprised of loans originated through the legacy UMB channels. This increase was primarily driven by an increase in commercial loans of $487.6 million and a $314.8 million increase in commercial real estate loans.

Nonperforming loans increased to $37.6 million on June 30, 2015, from $27.2 million on June 30, 2014. Nonperforming loans are defined as nonaccrual loans and restructured loans. As a percentage of loans, nonperforming loans increased to 0.42 percent as of June 30, 2015, compared to 0.39 percent on June 30, 2014. The company's allowance for loan losses totaled $77.7 million, or 0.87 percent of loans, as of June 30, 2015, compared to $76.8 million, or 1.11 percent of loans, as of June 30, 2014.

For the three months ended June 30, 2015, average securities, including trading securities, totaled $7.4 billion. This is an increase of $442.3 million, or 6.3 percent, from the same period in 2014.

Average total deposits increased $1.1 billion, or 9.4 percent, to $13.4 billion for the three months ended June 30, 2015, compared to the same period in 2014. Deposit balances with an acquired value of $944.1 million at May 31, 2015 were acquired as part of the Marquette acquisition. Average noninterest-bearing demand deposits increased $351.4 million, or 6.8 percent, in the period compared to the same one in 2014. Average interest-bearing deposits increased by $798.1 million, or 11.2 percent, in the second quarter of 2015 as compared to the same period in 2014. Total actual deposits as of June 30, 2015, were $14.5 billion, compared to $12.2 billion as of June 30, 2014, a 19.1 percent increase. Also, for the three months ended June 30, 2015, average noninterest-bearing demand deposits were 41.0 percent of average total deposits.

As of June 30, 2015, UMB had total shareholders' equity of $1.9 billion, an increase of 16.0 percent as compared to June 30, 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.

"The acquisition of Marquette furthers our strategy to shift the mix of earning assets," said Brian Walker, Chief Financial Officer. "This continued shift, along with solid loan growth across our footprint, resulted in a 60.1 percent average loan-to-deposit ratio compared to 56.2 percent for the quarter ended June 30, 2014, and a net interest margin of 2.59 percent, an increase from 2.53 percent a year ago."

Year-to-Date

Earnings for the six months ended June 30, 2015, were $64.0 million or $1.40 per share ($1.39 diluted). This is an increase of $5.9 million, or 10.1 percent, compared to earnings for the six months ended June 30, 2014, of $58.1 million or $1.30 per share ($1.28 diluted).

Net interest income for the six months ended June 30, 2015, increased $16.1 million, or 9.4 percent, compared to the same period in 2014. Net interest margin increased to 2.53 percent for the six months ended June 30, 2015, as compared to 2.45 percent for the same period in 2014.

Noninterest income decreased $12.2 million, or 4.8 percent, to $244.8 million for the six months ended June 30, 2015, as compared to the same period in 2014. The decrease in noninterest income is primarily driven by decreased trust and securities processing income of $10.2 million, or 7.1 percent. The decrease in trust and securities processing income was primarily due to a $17.4 million, or 35.2 percent, decrease in advisory fee income from the Scout Funds, partially offset by an increase of $3.7 million, or 8.1 percent, in fees related to institutional and personal investment management services and a $2.6 million, or 5.9 percent, increase in fund administration and custody services. Equity earnings on alternative investments decreased $8.0 million compared to the same period in 2014. Gains on securities available for sale of $8.3 million were recognized in the first six months of 2015 compared to $4.0 million for the same period in 2014, a $4.3 million increase.

Noninterest expense decreased $1.8 million, or 0.5 percent, for the six months ended June 30, 2015, compared to the same period in 2014. This decrease was driven by a $20.3 million contingency reserve expense recognized in 2014 in conjunction with the settlement agreement entered into on June 30, 2014, to resolve the PCM dispute. Of this amount $15.0 million was recognized in the first quarter of 2014 and $5.3 million was recognized in the second quarter of 2014. This decrease was largely offset by an increase in salaries and employee benefits of $19.7 million, or 11.0 percent, compared to the same period in 2014. The drivers of this increase include an increase in salary and wage expense of $12.2 million, or 11.3 percent, an increase in bonus and commission expense of $5.1 million, or 13.7 percent, and an increase in employee benefits expense of $2.4 million, or 7.2 percent. The acquisition of Marquette added approximately $3.4 million of salary and benefits expense for the first six months of 2015. Total acquisition expenses recognized in noninterest expense during the first six months of 2015 totaled $1.5 million.

Dividend Declaration

The Board of Directors declared during the company's quarterly board meeting a $0.235 quarterly cash dividend, payable on Oct. 1, 2015, to shareholders of record at the close of business on Sept. 10, 2015.

Conference Call

The company plans to host a conference call to discuss its 2015 second quarter earnings results on July 29, 2015, at 8:30 a.m. (CDT).

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 2Q 2015 Conference Call

A replay of the conference call may be heard through August 12, 2015, by calling (toll-free) 877-344-7529 or (U.S.) 412-317-0088. The replay pass code required for playback is 10068556. The call replay may also be accessed via the company's website umbfinancial.com by visiting the investor relations area.

Forward-Looking Statements and Non-GAAP Reconciliation:

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. 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.

In this release, we provide information using the tangible book value (TBV) of Marquette Financial Companies (MFC). This table is being provided as an update to materials furnished on December 15, 2014 in relation to our announcement of the agreement to acquire MFC. 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 difference between the TBV of MFC and the comparable GAAP measure is reconciled later in this release. We believe that this information and the reconciliation may be useful to investors because TBV is commonly used by investors as an additional measure of a company's total value and the strength and adequacy of its capital-management strategies.

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.

 
Consolidated Balance Sheets     UMB Financial Corporation
(unaudited, dollars in thousands)  
June 30,

Assets

  2015       2014  
 
Loans $ 8,916,128 $ 6,920,683
Allowance for loan losses   (77,721 )     (76,802 )
Net loans   8,838,407       6,843,881  
Loans held for sale 2,819 3,156
Investment securities:
Available for sale 6,925,115 6,700,623
Held to maturity 446,881 238,799
Trading securities 36,616 26,484
Other securities   77,800       67,527  
Total investment securities   7,486,412       7,033,433  
Federal funds and resell agreements 91,326 82,652
Interest-bearing due from banks 698,940 255,453
Cash and due from banks 490,171 639,878
Bank premises and equipment, net 279,996 250,655
Accrued income 84,979 73,805
Goodwill 228,217 209,758
Other intangibles 53,649 49,888
Other assets   163,811       120,131  
Total assets $ 18,418,727     $ 15,562,690  
 
 

Liabilities

Deposits:
Noninterest-bearing demand $ 5,887,525 $ 5,399,733
Interest-bearing demand and savings 7,303,306 5,754,573
Time deposits under $100,000 479,820 442,361
Time deposits of $100,000 or more   825,995       577,622  
Total deposits   14,496,646       12,174,289  
Federal funds and repurchase agreements 1,774,435 1,607,294
Long-term debt 88,346 5,745
Accrued expenses and taxes 155,246 131,996
Other liabilities   46,998       42,024  
Total liabilities   16,561,671       13,961,348  
 

Shareholders' Equity

Common stock 55,057 55,057
Capital surplus 1,009,965 887,086
Retained earnings 1,005,563 922,268
Accumulated other comprehensive (loss) income (2,141 ) 16,901
Treasury stock   (211,388 )     (279,970 )
Total shareholders' equity   1,857,056       1,601,342  
Total liabilities and shareholders' equity $ 18,418,727     $ 15,562,690  
 
     
Consolidated Statements of Income                 UMB Financial Corporation
(unaudited, dollars in thousands except share and per share data)  
Three Months Ended Six Months Ended
June 30, June 30,

Interest Income

  2015       2014     2015       2014
Loans $ 71,396 $ 60,309 $ 135,628 $ 119,209
Securities:
Taxable interest 19,163 19,021 37,971 37,982
Tax-exempt interest 10,607       9,798     20,522       19,705
Total securities income 29,770 28,819 58,493 57,687
Federal funds and resell agreements 151 46 202 79
Interest-bearing due from banks 434 466 1,286 1,589
Trading securities 133       149     228       272
Total interest income 101,884       89,789     195,837       178,836
 

Interest Expense

Deposits 3,522 3,092 6,570 6,151
Federal funds and repurchase agreements 470 454 962 935
Other 532       73     587       135
Total interest expense 4,524       3,619     8,119       7,221
Net interest income 97,360 86,170 187,718 171,615
Provision for loan losses 5,000       5,000     8,000       9,500
Net interest income after provision for loan losses 92,360       81,170     179,718       162,115
 

Noninterest Income

Trust and securities processing 67,381 73,357 134,680 144,920
Trading and investment banking 5,568 6,409 11,690 10,732
Service charges on deposits 21,625 20,627 43,166 42,185
Insurance fees and commissions 586 732 1,156 1,335
Brokerage fees 2,936 3,075 5,790 4,890
Bankcard fees 18,035 17,185 34,218 32,808
Gains on sale of securities available for sale, net 967 2,569 8,303 4,039
Equity (loss) earnings on alternative investments (1,125 ) 3,462 (1,967 ) 5,992
Other 3,577       6,585     7,721       10,064
Total noninterest income 119,550       134,001     244,757       256,965
 

Noninterest Expense

Salaries and employee benefits 99,585 89,532 198,122 178,413
Occupancy, net 10,312 9,705 20,322 19,410
Equipment 15,410 12,920 29,582 25,583
Supplies, postage and telephone 4,603 5,554 8,928 10,191
Marketing and business development 6,530 6,307 11,148 10,909
Processing fees 12,654 14,817 25,437 28,468
Legal and consulting 5,917 4,632 10,295 8,004
Bankcard 4,953 4,997 9,721 8,685
Amortization of other intangibles 2,569 3,074 5,324 6,176
Regulatory fees 2,873 2,709 5,629 5,225
Contingency reserve - 5,272 - 20,272
Other 6,558       6,682     11,869       16,796
Total noninterest expense 171,964 166,201 336,377 338,132
 
Income before income taxes 39,946 48,970 88,098 80,948
Income tax provision 9,732       14,298     24,119       22,863
Net income $ 30,214     $ 34,672   $ 63,979     $ 58,085
 

Per Share Data

Net income - basic $ 0.65 $ 0.77 $ 1.40 $ 1.30
Net income – diluted 0.65 0.76 1.39 1.28
Dividends 0.235 0.225 0.470 0.450
Weighted average shares outstanding 46,240,869 44,823,370 45,624,276 44,782,944
Weighted average shares outstanding - diluted 46,611,096 45,421,148 46,029,978 45,409,289
 
 

Consolidated Statements of Comprehensive Income

  UMB Financial Corporation
(unaudited, dollars in thousands, except per share data)      
Three Months Ended

June 30,

Six Months Ended

June 30,

2015     2014     2015     2014  
Net Income $ 30,214   $ 34,672 $ 63,979 $ 58,085
Other comprehensive income, net of tax:
Unrealized (losses) gains on securities:
Change in unrealized holding (losses) gains, net (45,553 ) 50,910 (12,877 ) 83,369
Less: Reclassifications adjustment for gains included in net income   (967 )     (2,569 )     (8,303 )     (4,039 )
Change in unrealized (losses) gains on securities during the period (46,520 ) 48,341 (21,180 ) 79,330
Income tax benefit (expense)   17,569       (18,143 )     8,033       (29,789 )
Other comprehensive (loss) income   (28,951 )     30,198       (13,147 )     49,541  
Comprehensive income $ 1,263     $ 64,870     $ 50,832     $ 107,626  
 
           
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     Income (Loss)     Stock     Total
Balance - January 1, 2014 $ 55,057 $ 882,407 $ 884,630 $ (32,640 ) $ (283,389 ) $ 1,506,065
Total comprehensive income - - 58,085 49,541 - 107,626
Cash dividends ($0.45 per share) - - (20,447 ) - - (20,447 )
Purchase of treasury stock - - - - (3,165 ) (3,165 )
Issuance of equity awards - (3,395 ) - - 3,865 470
Recognition of equity based compensation - 4,733 - - - 4,733
Net tax benefit related to equity compensation plans - 1,202 - - - 1,202
Sale of treasury stock - 300 - - 159 459
Exercise of stock options   -     1,839       -       -       2,560       4,399  
Balance – June 30, 2014 $ 55,057   $ 887,086     $ 922,268     $ 16,901     $ (279,970 )   $ 1,601,342  
 
Balance - January 1, 2015 $ 55,057 $ 894,602 $ 963,911 $ 11,006 $ (280,818 ) $ 1,643,758
Total comprehensive income (loss) - - 63,979 (13,147 ) - 50,832
Cash dividends ($0.47 per share) - - (22,327 ) - - (22,327 )
Purchase of treasury stock - - - - (5,379 ) (5,379 )
Issuance of equity awards - (5,509 ) - - 5,969 460
Recognition of equity based compensation - 5,779 - - - 5,779
Net tax benefit related to equity compensation plans - 664 - - - 664
Sale of treasury stock - 306 - - 197 503
Exercise of stock options - 1,488 - - 1,541 3,029
Common stock issuance for

acquisition

  -     112,635       -       -       67,102       179,737  
Balance – June 30, 2015 $ 55,057   $ 1,009,965     $ 1,005,563     $ (2,141 )   $ (211,388 )   $ 1,857,056  
 
   
Average Balances / Yields and Rates           UMB Financial Corporation  
(tax - equivalent basis)    
(unaudited, dollars in thousands) Three Months Ended June 30,
  2015     2014
Average Average Average Average
Assets   Balance   Yield/Rate       Balance   Yield/Rate  
Loans, net of unearned interest $ 8,071,991 3.55 % $ 6,897,840 3.51 %
Securities:
Taxable 4,974,668 1.55 4,836,080 1.58
Tax-exempt 2,407,759     2.72 2,104,368     2.88
Total securities 7,382,427 1.93 6,940,448 1.97
Federal funds and resell agreements 69,053 0.88 32,692 0.56
Interest-bearing due from banks 414,446 0.42 619,094 0.30
Trading securities 37,063     1.70 36,785     1.80
Total earning assets 15,974,980 2.70 14,526,859 2.63
Allowance for loan losses (77,667 ) (75,929 )
Other assets   1,515,687     1,167,262  
Total assets $ 17,413,000   $ 15,618,192  
 
 
Liabilities and Shareholders' Equity
Interest-bearing deposits $ 7,924,696 0.18 % $ 7,126,614 0.17 %
Federal funds and repurchase agreements 1,715,836 0.11 1,592,986 0.11
Borrowed funds 49,827     4.28 5,771     5.07
Total interest-bearing liabilities 9,690,359 0.19 8,725,371 0.17
Noninterest-bearing demand deposits 5,504,333 5,152,980
Other liabilities 473,676 154,229
Shareholders' equity   1,744,632     1,585,612  
Total liabilities and shareholders' equity $ 17,413,000   $ 15,618,192  
Net interest spread 2.51 % 2.46 %
Net interest margin 2.59 2.53
 
 
Six Months Ended June 30,
  2015     2014
Average Average Average Average
Assets   Balance   Yield/Rate       Balance   Yield/Rate  
Loans, net of unearned interest $ 7,772,709 3.52 % $ 6,788,991 3.54 %
Securities:
Taxable 4,921,907 1.56 4,861,475 1.58
Tax-exempt 2,331,422     2.73 2,107,119     2.90
Total securities 7,253,329 1.93 6,968,594 1.98
Federal funds and resell agreements 51,793 0.79 29,939 0.53
Interest-bearing due from banks 759,238 0.34 1,154,811 0.28
Trading securities 33,661     1.76 37,682     1.63
Total earning assets 15,870,730 2.63 14,980,017 2.55
Allowance for loan losses (77,124 ) (75,466 )
Other assets   1,330,476     1,160,124  
Total assets $ 17,124,082   $ 16,064,675  
 
 
Liabilities and Shareholders' Equity
Interest-bearing deposits $ 7,764,368 0.17 % $ 7,545,182 0.16 %
Federal funds and repurchase agreements 1,713,386 0.11 1,630,169 0.12
Borrowed funds 29,193     4.05 5,738     4.74
Total interest-bearing liabilities 9,506,947 0.17 9,181,089 0.16
Noninterest-bearing demand deposits 5,582,180 5,160,206
Other liabilities 325,066 156,608
Shareholders' equity   1,709,889     1,566,772  
Total liabilities and shareholders' equity $ 17,124,082   $ 16,064,675  
Net interest spread 2.46 % 2.39 %
Net interest margin 2.53 2.45
 
 
SECOND QUARTER 2015
FINANCIAL HIGHLIGHTS     UMB Financial Corporation

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

 
Six Months Ended June 30 2015 2014
Net interest income $ 187,718 $ 171,615
Provision for loan losses 8,000 9,500
Noninterest income 244,757 256,965
Noninterest expense 336,377 338,132
Income before income taxes 88,098 80,948
Net income 63,979 58,085
Net income per share - Basic 1.40 1.30
Net income per share - Diluted 1.39 1.28
Return on average assets 0.75 % 0.73 %
Return on average equity 7.55 % 7.48 %
 
Three Months Ended June 30
Net interest income $ 97,360 $ 86,170
Provision for loan losses 5,000 5,000
Noninterest income 119,550 134,001
Noninterest expense 171,964 166,201
Income before income taxes 39,946 48,970
Net income 30,214 34,672
Net income per share - Basic 0.65 0.77
Net income per share - Diluted 0.65 0.76
Return on average assets 0.70 % 0.89 %
Return on average equity 6.95 % 8.77 %
 
At June 30
Assets $ 18,418,727 $ 15,562,690
Loans, net of unearned interest 8,916,128 6,920,683
Securities 7,486,412 7,033,433
Deposits 14,496,646 12,174,289
Shareholders' equity 1,857,056 1,601,342
Book value per share 37.68 35.21
Market price per share 57.02 63.39
Equity to assets 10.08 % 10.29 %
Allowance for loan losses $ 77,721 $ 76,802
As a % of loans 0.87 % 1.11 %
Nonaccrual and restructured loans $ 37,649 $ 27,175
As a % of loans 0.42 % 0.39 %
Loans over 90 days past due $ 7,645 $ 4,522
As a % of loans 0.09 % 0.07 %
Other real estate owned $ 2,553 $ 1,455
Net loan charge-offs quarter-to-date $ 4,758 $ 3,713
As a % of average loans 0.24 % 0.22 %
Net loan charge-offs year-to-date $ 6,419 $ 7,449
As a % of average loans 0.17 % 0.22 %
 
Common shares outstanding 49,288,971 45,475,197
Average Balances
 
Six Months Ended June 30
Assets $ 17,124,082 $ 16,064,675
Loans, net of unearned interest 7,772,709 6,788,991
Securities 7,286,990 7,006,276
Deposits 13,346,548 12,705,388
Shareholders' equity 1,709,889 1,566,772
 
       
Business Segment Information          

 

 

UMB Financial Corporation

(unaudited, dollars in thousands)  
Three Months Ended June 30, 2015
Bank  

Payment
Solutions

 

Institutional
Investment
Management

 

Asset
Servicing

  Total
Net interest income $ 82,758 $ 13,599 $ - $ 1,003 $ 97,360
Provision for loan losses 2,612 2,388 - - 5,000
Noninterest income 47,548 23,293 25,684 23,025 119,550
Noninterest expense   107,293     26,399     18,285     19,987     171,964
Income before taxes 20,401 8,105 7,399 4,041 39,946
Income tax expense   4,915     2,046     1,785     986     9,732
Net income $ 15,486   $ 6,059   $ 5,614   $ 3,055   $ 30,214
 
Average assets $ 13,423,000 $ 2,980,000 $ 70,000 $ 940,000 $ 17,413,000
 
 
Three Months Ended June 30, 2014
Bank  

Payment
Solutions

 

Institutional
Investment
Management

 

Asset
Servicing

  Total
Net interest income $ 72,481 $ 12,390 $

(1)

$ 1,300 $ 86,170
Provision for loan losses 2,686 2,314 - - 5,000
Noninterest income 56,024 21,201 33,999 22,777 134,001
Noninterest expense   100,788     24,506     22,053     18,854     166,201
Income before taxes 25,031 6,771 11,945 5,223 48,970
Income tax expense   7,482     1,931     3,389     1,496     14,298
Net income $ 17,549   $ 4,840   $ 8,556   $ 3,727   $ 34,672
 
Average assets $ 12,008,000 $ 2,148,000 $ 69,000 $ 1,393,000 $ 15,618,000
 
 
Six Months Ended June 30, 2015
Bank  

Payment
Solutions

 

Institutional
Investment
Management

 

Asset
Servicing

  Total
Net interest income $ 158,085 $ 27,632 $

1

$

2,000

$

187,718
Provision for loan losses 4,211 3,789 - - 8,000
Noninterest income 99,099 46,432 52,768 46,458 244,757
Noninterest expense   207,861   51,062     36,227     41,227     336,377
Income before taxes 45,112 19,213 16,542 7,231 88,098
Income tax expense   12,313     5,373     4,511     1,922     24,119
Net income $ 32,799   $ 13,840   $

12,031

 

$

5,309

 

$

63,979
 
Average assets $ 13,089,000 $ 3,031,000 $

72,000

$

932,000

$

17,124,000
 
Six Months Ended June 30, 2014
Bank  

Payment
Solutions

 

Institutional
Investment
Management

 

Asset
Servicing

  Total
Net interest income $ 143,602 $ 24,778 $

(3)

$

3,238

$

171,615
Provision for loan losses 5,112 4,388 - - 9,500
Noninterest income 103,458 41,420 68,094 43,993 256,965
Noninterest expense   208,337     45,453     47,943     36,399     338,132
Income before taxes 33,611 16,357 20,148 10,832 80,948
Income tax expense   9,801     4,524     5,532     3,006     22,863
Net income $ 23,810   $ 11,833   $

14,616

 

$

7,826

 

$

58,085
 
Average assets $ 12,204,000 $ 2,023,000 $

71,000

$

1,767,000

$

16,065,000
 
   
Non-GAAP Reconciliation Schedule UMB Financial Corporation
(unaudited, dollars in thousands)
 
Price to MFC Tangible Book Value at May 31, 2015  
 

GAAP Total Shareholders' Equity (1)

$127,277
Deduct: Goodwill and Other Intangibles

 (7,626)

Tangible Book Value $119,651

Total Consideration (2)

$179,737
Price to Tangible Book Value 150%
Price to GAAP Total Shareholders' Equity 141%
(1) Source: MFC financial statements as of May 31, 2015.
(2) Based on UMBF 05/29/15 closing price per share of $51.79 and consideration of 3.47 million shares

of UMBF stock, subject to post-closing adjustments.

 

UMB Financial Corporation
Media Contact:
Kelli Christman, 816-860-5088
or
Investor Relations Contact:
Kay Gregory, 816-860-7106

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