UMBF UMB Financial Corporation

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): 10/28/2014

 

 

UMB FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

 

 

Commission File Number : 0-4887

 

MO		43-0903811
(State or other jurisdiction of incorporation)		(IRS Employer Identification No.)

1010 Grand Blvd., Kansas City, MO 64106

(Address of principal executive offices, including zip code)

(816) 860-7000

(Registrant’s telephone number, including area code)

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

 

 

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

 

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

 

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

 

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

 

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

 

 

 

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Item 2.02

Results of Operations and Financial Condition

On October 28, 2014, UMB Financial Corporation (the “Company”) issued a press release announcing the financial results for the Company for the quarter ending September 30, 2014. A copy of the press release is attached as Exhibit 99.1.

The information contained in Item 2.02 of this Current Report and in Exhibit 99.1 is being furnished and shall not be deemed to be “filed” with the SEC for the purposes of Section 18 of the Exchange Act of 1934, as amended or otherwise subject to the liabilities of that section.

 

Item 7.01

Regulation FD Disclosure

The information provided under Item 7.01 of this Current Report on Form 8-K is being furnished and is not deemed to be “filed” with the SEC for the purposes of Section 18 of the Exchange Act of 1934, as amended or otherwise subject to the liabilities of that section.

The Company is furnishing a copy of materials that will be used in the Company’s shareholder conference call on October 29, 2014, at 8:30 a.m. (CST). A copy of the materials is attached as Exhibit 99.2 and will be available on the Company’s website at www.umbfinancial.com. The materials are dated October 28, 2014, and the Company disclaims any obligation to correct or update any of the materials in the future.

The Company’s October 28, 2014, press release that is attached as Exhibit 99.1 also announced that the Board of Directors declared an increase in its regular quarterly dividend from $0.225 per share to $0.235 per share. The $0.235 per share dividend will be payable on January 2, 2015, to shareholders of record on December 10, 2014.

 

Item 9.01

Financial Statements and Exhibits

 

Exhibit 99.1		Press Release announcing financial results for quarter ending September 30, 2014, and announcing dividend declaration
Exhibit 99.2		Investor Presentation Materials, dated October 28, 2014.

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SIGNATURES

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

 

Date: October 28, 2014

Exhibit 99.1

 

 

UMB Financial Corporation 1010 Grand Boulevard Kansas City, MO 64106 816.860.7000 umb.com				News Release

//FOR IMMEDIATE RELEASE//

Media Contact: Kelli Christman: 816.860.5088

Investor Relations Contact: Abby Wendel: 816.860.1685

UMB Financial Corporation Reports Third Quarter 2014 Earnings of $35.6 million, or $0.78 per Diluted Share

Selected third quarter financial highlights:

 

•

Net loans for the three months ended September 30, 2014 increased 9.2 percent to $7.0 billion compared to the three months ended September 30, 2013

 

•

Nonperforming loans decreased to 0.46 percent of loans as of September 30, 2014, from 0.48 percent of loans as of September 30, 2013

 

•

Total assets under management stood at $42.1 billion as of September 30, 2014, an increase of 7.9 percent compared to the third quarter of 2013

 

•

Company-wide noninterest income was 59.1 percent of total revenue

 

•

Tier 1 capital ratio remains strong at 13.72 percent

KANSAS CITY, Mo. (October 28, 2014) – UMB Financial Corporation (Nasdaq: UMBF), a diversified financial holding company, announced earnings for the three months ended September 30, 2014 of $35.6 million or $0.79 per share ($0.78 diluted). This is an increase of $1.2 million, or 3.5 percent, compared to third quarter 2013 earnings of $34.4 million or $0.85 per share ($0.83 diluted). Earnings for the nine months ended September 30, 2014, were $93.7 million or $2.09 per share ($2.06 diluted) or a decrease of $5.6 million, or 5.6 percent, compared to the prior year-to-date earnings of $99.3 million or $2.47 per share ($2.44 diluted).

“In the third quarter, UMB delivered sound results against our business model that emphasizes diverse revenue sources, high quality credit, a strong balance sheet and low-cost funding,” said Mariner Kemper, Chairman and Chief Executive Officer. “Noninterest income growth was diversified across our lines of business, allowing us to remain well-positioned in the existing low interest rate environment.

“Average loans and deposits grew, profit margins for our nonbank segments improved, and total company revenue expanded in the third quarter, year-over-year,” continued Kemper. “Our strategy to shift our earning asset mix to loans remains a top priority. Commercial lending teams in Kansas City, Dallas/Ft. Worth and Phoenix led the way with loan growth resulting in an average loan-to-deposit ratio of 55.9 percent for the third quarter compared to 54.4 percent in the third quarter 2013. Margin was flat on a linked quarter basis.”

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Net Interest Income and Margin

Net interest income for the third quarter of 2014 increased $2.0 million, or 2.3 percent, compared to the same period in 2013. Average earning assets increased by $719.9 million, or 5.2 percent, compared to the third quarter of 2013. This increase was due to a $578.0 million, or 9.0 percent, increase in average loans, and a $158.9 million, or 46.4 percent, increase in interest-bearing due from banks. Net interest margin decreased eight basis points to 2.53 percent for the three months ended September 30, 2014, compared to the same quarter in 2013.

Noninterest Income and Expense

Noninterest income increased $4.9 million, or 4.0 percent, for the three months ended September 30, 2014, compared to the same period in 2013. This increase is attributable to increased trust and securities processing income of $5.6 million, or 8.2 percent, for the three months ended September 30, 2014, compared to the same period in 2013. The increase in trust and securities processing income was primarily due to a $4.1 million, or 20.0 percent, increase in fees related to institutional and personal investment management services, and a $2.3 million, or 11.1 percent, increase in fund administration and custody services, offset by a $1.6 million, or 6.6 percent decrease, in advisory fee income from the Scout Funds. Bankcard fees increased $1.9 million, or 12.7 percent, due to an increase in interchange income. These increases were offset by a decrease in gains on sales of securities available for sale of $1.1 million, a decrease in equity earnings on alternative investments related to Prairie Capital Management (“PCM”) equity method investments of $1.4 million, and a decrease in other noninterest income of $1.2 million for the three months ended September 30, 2014, compared to the same period in 2013.

In discussing fee businesses, Kemper said, “total assets under management grew to $42.1 billion, assets under administration totaled $210.6 billion, and card purchase volume topped $2.1 billion. Our differentiated business model – with more than half of revenue coming from fee businesses – provides us an enviable position among our peers and the industry.”

Noninterest expense increased $8.4 million, or 5.5 percent, for the three months ended September 30, 2014, compared to the same period in 2013. This increase is driven by higher salaries and employee benefits expense of $6.3 million due to increases in salaries and wages of $3.2 million, or 5.9 percent, and an increase in commissions and bonuses of $3.2 million or 20.3 percent. Equipment expense increased by $1.2 million, or 9.9 percent, due to an increase in computer hardware and software expenses.

Balance Sheet

Average total assets for the three months ended September 30, 2014, were $15.6 billion compared to $14.9 billion for the same period in 2013, an increase of $0.7 billion, or 4.8 percent. Average earning assets increased by $0.7 billion for the period, or 5.2 percent.

Average loan balances for the three months ended September 30, 2014, increased $578.0 million, or 9.0 percent, to $7.0 billion compared to the same period in 2013. Actual loan balances on September 30, 2014, were $7.1 billion, an increase of $0.6 billion, or 9.2 percent, compared to September 30, 2013. This increase was primarily driven by an increase in commercial real estate loans of $171.7 million, or 10.5 percent, an increase in commercial loans of $162.9 million, or 4.8 percent, and an increase in construction loans of $123.2 million. Nonperforming loans, defined as nonaccrual loans and restructured loans, increased to $32.7 million on September 30, 2014, from $31.3 million on September 30, 2013. As a percentage of loans, nonperforming loans decreased to 0.46 percent as of September 30, 2014, compared to 0.48 percent as of September 30, 2013. The company’s allowance for loan losses totaled $77.3 million, or 1.09 percent of loans, as of September 30, 2014, compared to $74.9 million, or 1.15 percent of loans, as of September 30, 2013.

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For the three months ended September 30, 2014, average securities, including trading securities, totaled $7.0 billion. This is a decrease of $31.5 million, or 0.4 percent, from the same period in 2013.

Average total deposits increased $717.1 million, or 6.1 percent, to $12.5 billion for the three months ended September 30, 2014, compared to the same period in 2013. Average noninterest-bearing demand deposits increased $390.9 million, or 8.4 percent, compared to 2013. Average interest-bearing deposits increased by $326.2 million, or 4.6 percent, in 2014 as compared to 2013. Total deposits as of September 30, 2014, were $12.8 billion, compared to $13.0 billion as of September 30, 2013, a 2.2 percent decrease. Also, as of September 30, 2014, noninterest-bearing demand deposits were 42.9 percent of total deposits, compared to 43.2 percent as of September 30, 2014.

As of September 30, 2014, UMB had total shareholders’ equity of $1.6 billion, an increase of 10.4 percent as compared to the same period in 2013.

Year-to-Date

Earnings for the nine months ended September 30, 2014, were $93.7 million or $2.09 per share ($2.06 diluted). This is a decrease of $5.6 million, or 5.6 percent, compared to the prior year-to-date earnings of $99.3 million or $2.47 per share ($2.44 diluted).

Net interest income for the nine months ended September 30, 2014, increased $11.8 million, or 4.8 percent, compared to the same period in 2013. Average earning assets increased by $1.1 billion, or 7.7 percent, compared to the same period in 2013. This increase was due to a $726.0 million, or 11.8 percent, increase in average loans, and a $354.2 million, or 61.0 percent, increase in interest-bearing due from banks. Net interest margin decreased eight basis points to 2.48 percent for the nine months ended September 30, 2014, compared to the same period in 2013.

Noninterest income increased $27.2 million, or 7.6 percent, to $383.4 million for the nine months ended September 30, 2014, as compared to the same period in 2013. The increase in noninterest income is primarily driven by increased trust and securities processing income of $24.7 million, or 12.7 percent. The increase in trust and securities processing income was primarily due to a $10.9 million, or 18.1 percent, increase in fees related to institutional and personal investment management services, a $6.7 million, or 11.4 percent, increase in fund administration and custody services, and a $4.8 million, or 7.1 percent, increase in advisory fee income from the Scout Funds. Additional increases in noninterest income include a $4.6 million increase in equity earnings on alternative investments due to unrealized gains on PCM equity method investments and a $2.9 million, or 28.1 percent, increase in other noninterest income. The increase in other noninterest income is driven by a $2.8 million gain on the sale of a branch property during the first nine months of 2014 compared to the same period in 2013. These increases were offset by a decrease in gains on sales of securities available for sale of $4.5 million in the first nine months of 2014 compared to the same period in 2013.

Noninterest expense increased $46.5 million, or 10.2 percent, for the nine months ended September 30, 2014, compared to the same period in 2013. This increase is driven by an increase in salaries and employee benefits expense of $17.5 million, or 7.0 percent, a $20.3 million increase in the contingency reserve, and a $5.0 million, or 24.1 percent, increase in other noninterest expense. Other noninterest expense increased $3.0 million due to fair value adjustments on contingent consideration liabilities on acquisitions and $1.3 million due to fair value adjustments on interest rate swap transactions.

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Dividend Declaration

At the company’s quarterly board meeting, the Board of Directors declared a $0.235 quarterly cash dividend, which represents a 4.4 percent increase compared to the last quarterly dividend, payable on January 2, 2015, to shareholders of record at the close of business on December 10, 2014.

Conference Call

The company plans to host a conference call to discuss its 2014 third quarter earnings results on Oct. 29, 2014, at 8:30 a.m. (CT).

Interested parties may access the call by dialing (toll-free) 888-337-8169 or (U.S.) 719-325-2144 and entering conference identification number 8835300. The live call can also be accessed by visiting the investor relations area of umb.com or by using the following the link:

http://event.on24.com/r.htm?e=861949&s=1&k=BF04BE655704A30A88C6CEEF87C86D48

A replay of the conference call may be heard until Nov. 12, 2014, by calling (toll-free) 888-203-1112 or (U.S.) 719-457-0820. The replay pass code required for playback is 8835300. The call replay may also be accessed via the company’s website umb.com by visiting the investor relations area.

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. 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, 2013, 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 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. 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.

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

 

		September 30,
		2014				2013
Assets
Loans		$	7,103,163			$	6,506,902
Allowance for loan losses			(77,316	)			(74,938	)
Net loans			7,025,847				6,431,964
Loans held for sale			1,718				3,033
Investment securities:
Available for sale			6,759,803				6,697,997
Held to maturity			237,961				175,993
Trading securities			31,790				54,994
Federal Reserve Bank Stock and other			71,192				31,478
Total investment securities			7,100,746				6,960,462
Federal funds and resell agreements			65,255				54,434
Interest-bearing due from banks			986,428				1,357,881
Cash and due from banks			395,956				604,592
Bank premises and equipment, net			257,341				247,827
Accrued income			77,263				72,030
Goodwill			209,758				209,758
Other intangibles			46,966				58,749
Other assets			116,750				183,503
Total assets		$	16,284,028			$	16,184,233
Liabilities
Deposits:
Noninterest-bearing demand		$	5,467,810			$	5,628,258
Interest-bearing demand and savings			6,324,535				6,248,189
Time deposits under $100,000			434,863				593,275
Time deposits of $100,000 or more			526,229				571,322
Total deposits			12,753,437				13,041,044
Federal funds and repurchase agreements			1,711,809				1,527,964
Short-term debt			—				211
Long-term debt			7,067				5,130
Accrued expenses and taxes			161,194				130,398
Other liabilities			35,172				15,831
Total liabilities			14,668,679				14,720,578
Shareholders’ Equity
Common stock			55,057				55,057
Capital surplus			891,353				862,153
Retained earnings			947,664				860,138
Accumulated other comprehensive income (loss)			1,827				(15,678	)
Treasury stock			(280,552	)			(298,015	)
Total shareholders’ equity			1,615,349				1,463,655
Total liabilities and shareholders’ equity		$	16,284,028			$	16,184,233

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Consolidated Statements of Income		UMB Financial Corporation
(unaudited, dollars in thousands except share and per share data)

 

		Three Months Ended September 30,								Nine Months Ended September 30,
		2014				2013				2014				2013
Interest Income
Loans		$	61,636			$	59,125			$	180,844			$	170,459
Securities:
Taxable Interest			18,884				19,017				56,866				56,325
Tax-exempt interest			9,745				10,338				29,450				30,216
Total securities income			28,629				29,355				86,316				86,541
Federal funds and resell agreements			87				62				166				126
Interest bearing due from banks			426				276				2,015				1,276
Trading securities			39				278				311				808
Total interest income			90,817				89,096				269,653				259,210
Interest Expense
Deposits			3,015				3,097				9,166				10,222
Federal funds and repurchase agreements			358				385				1,293				1,443
Other			(82	)			69				53				190
Total interest expense			3,291				3,551				10,512				11,855
Net interest income			87,526				85,545				259,141				247,355
Provision for loan losses			4,500				6,500				14,000				13,500
Net interest income after provision for loan losses			83,026				79,045				245,141				233,855
Noninterest Income
Trust and securities processing			74,062				68,465				218,982				194,263
Trading and investment banking			3,826				3,792				14,558				16,324
Service charges on deposits			21,634				21,036				63,819				63,441
Insurance fees and commissions			911				869				2,246				3,066
Brokerage fees			3,276				2,895				8,166				8,727
Bankcard fees			17,121				15,196				49,929				47,666
Gains on sales of securities available for sale			26				1,140				4,065				8,552
Equity earnings on alternative investments			2,470				3,876				8,462				3,876
Other			3,149				4,356				13,213				10,311
Total noninterest income			126,475				121,625				383,440				356,226
Noninterest Expense
Salaries and employee benefits			90,041				83,733				268,454				251,000
Occupancy, net			10,475				10,016				29,885				29,175
Equipment			13,408				12,205				38,991				36,012
Supplies, postage and telephone			4,817				4,761				15,008				14,611
Marketing and business development			6,057				5,536				16,966				15,514
Processing fees			14,085				14,471				42,553				42,854
Legal and consulting			4,496				4,433				12,500				12,877
Bankcard			4,097				4,561				12,782				13,817
Amortization of other intangibles			3,043				3,245				9,219				10,054
Regulatory fees			2,577				2,670				7,802				7,066
Contingency Reserve			—				—				20,272				—
Other			8,365				7,432				25,781				20,772
Total noninterest expense			161,461				153,063				500,213				453,752
Income before income taxes			48,040				47,607				128,368				136,329
Income tax provision			12,410				13,175				34,653				37,027
Net income		$	35,630			$	34,432			$	93,715			$	99,302
Per Share Data
Net income- Basic		$	0.79			$	0.85			$	2.09			$	2.47
Net income- Diluted			0.78				0.83				2.06				2.44
Dividends			0.225				0.215				0.675				0.645
Weighted average shares outstanding			44,890,309				40,698,700				44,819,125				40,185,351

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Statements of Consolidated Comprehensive Income (Loss)		UMB Financial Corporation
(unaudited, dollars in thousands, except per share data)

 

		Three Months Ended September 30,								Six Months Ended September 30,
		2014				2013				2014				2013
Net Income		$	35,630			$	34,432			$	93,715			$	99,302
Other comprehensive (loss) income, net of tax:
Unrealized (losses) gains on securities:
Change in unrealized holding (losses) gains, net			(24,213	)			11,694				59,156				(151,721	)
Less: Reclassifications adjustment for gains included in net income			(26	)			(1,140	)			(4,065	)			(8,552	)
Change in unrealized (losses) gains on securities during the period			(24,239	)			10,554				55,091				(160,273	)
Income tax expense (benefit)			9,165				(4,005	)			(20,624	)			59,007
Other comprehensive (loss) income			(15,074	)			6,549				34,467				(101,266	)
Comprehensive income (loss)		$	20,556			$	40,981			$	128,182			$	(1,964	)

 

Consolidated Statements of Shareholders’ Equity		UMB Financial Corporation
(unaudited, dollars in thousands, except per share data)

 

		Common Stock				Capital Surplus				Retained Earnings				Accumulated Other Comprehensive Income (Loss)				Treasury Stock				Total
Balance—January 1, 2013		$	55,057			$	732,069			$	787,015			$	85,588			$	(380,384	)		$	1,279,345
Total comprehensive income (loss)			—				—				99,302				(101,266	)			—				(1,964	)
Cash dividends ($0.645 per share)			—				—				(26,179	)			—				—				(26,179	)
Purchase of treasury stock			—				—				—				—				(2,551	)			(2,551	)
Issuance of equity awards			—				(2,189	)			—				—				2,638				449
Recognition of equity based compensation			—				6,319				—				—				—				6,319
Net tax benefit related to equity compensation plans			—				963				—				—				—				963
Sale of treasury stock			—				367				—				—				172				539
Exercise of stock options			—				2,916				—				—				2,641				5,557
Common stock issuance			—				121,708				—				—				79,469				201,177
Balance – September 30, 2013		$	55,057			$	862,153			$	860,138			$	(15,678	)		$	(298,015	)		$	1,463,655
Balance—January 1, 2014		$	55,057			$	882,407			$	884,630			$	(32,640	)		$	(283,389	)		$	1,506,065
Total comprehensive income			—				—				93,715				34,467				—				128,182
Cash dividends ($0.675 per share)			—				—				(30,681	)			—				—				(30,681	)
Purchase of treasury stock			—				—				—				—				(3,858	)			(3,858	)
Issuance of equity awards			—				(2,624	)			—				—				3,114				490
Recognition of equity based compensation			—				7,224				—				—				—				7,224
Net tax benefit related to equity compensation plans			—				1,507				—				—				—				1,507
Sale of treasury stock			—				455				—				—				244				699
Exercise of stock options			—				2,384				—				—				3,337				5,721
Balance – September 30, 2014		$	55,057			$	891,353			$	947,664			$	1,827			$	(280,552	)		$	1,615,349

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Average Balances / Yields and Rates		UMB Financial Corporation
(tax—equivalent basis) (unaudited, dollars in thousands)

 

		Three Months Ended September 30,
		2014								2013
		Average Balance				Average Yield/Rate				Average Balance				Average Yield/Rate
Assets
Loans, net of unearned interest		$	6,996,363				3.50	%		$	6,418,368				3.65	%
Securities:
Taxable			4,864,337				1.54				4,835,235				1.56
Tax-exempt			2,128,281				2.80				2,150,108				2.95
Total securities			6,992,618				1.92				6,985,343				1.99
Federal funds and resell agreements			61,161				0.56				46,593				0.53
Interest-bearing due from banks			501,157				0.34				342,307				0.32
Trading securities			24,550				0.95				63,302				1.85
Total earning assets			14,575,849				2.62				13,855,913				2.71
Allowance for loan losses			(77,347	)							(72,792	)
Other assets			1,139,820								1,140,648
Total assets		$	15,638,322							$	14,923,769
Liabilities and Shareholders’ Equity
Interest-bearing deposits		$	7,444,093				0.16	%		$	7,117,927				0.17	%
Federal funds and repurchase agreements			1,347,665				0.11				1,764,082				0.09
Borrowed funds			5,728				(5.68	)			4,688				5.84
Total interest-bearing liabilities			8,797,486				0.15				8,886,697				0.16
Noninterest-bearing demand deposits			5,060,662								4,669,742
Other liabilities			167,704								107,000
Shareholders’ equity			1,612,470								1,260,330
Total liabilities and shareholders’ equity		$	15,638,322							$	14,923,769
Net interest spread							2.47	%							2.55	%
Net interest margin							2.53								2.61
		Nine Months Ended September 30,
		2014								2013
		Average Balance				Average Yield/Rate				Average Balance				Average Yield/Rate
Assets
Loans, net of unearned interest		$	6,858,874				3.53	%		$	6,132,892				3.72	%
Securities:
Taxable			4,862,439				1.56				4,894,956				1.54
Tax-exempt			2,114,251				2.87				2,086,482				2.99
Total securities			6,976,690				1.96				6,981,438				1.97
Federal funds and resell agreements			40,461				0.55				31,519				0.53
Interest-bearing due from banks			934,532				0.29				580,309				0.29
Trading securities			33,257				1.46				62,470				1.89
Total earning assets			14,843,814				2.57				13,788,628				2.67
Allowance for loan losses			(76,100	)							(71,438	)
Other assets			1,153,074								1,144,064
Total assets		$	15,920,788							$	14,861,254
Liabilities and Shareholders’ Equity
Interest-bearing deposits		$	7,511,115				0.16	%		$	7,026,963				0.19	%
Federal funds and repurchase agreements			1,534,966				0.11				1,762,087				0.11
Borrowed funds			5,735				1.24				4,888				5.20
Total interest-bearing liabilities			9,051,816				0.16				8,793,938				0.18
Noninterest-bearing demand deposits			5,126,660								4,644,338
Other liabilities			160,140								145,533
Shareholders’ equity			1,582,172								1,277,445
Total liabilities and shareholders’ equity		$	15,920,788							$	14,861,254
Net interest spread							2.41	%							2.49	%
Net interest margin							2.48								2.56

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THIRD QUARTER 2014 FINANCIAL HIGHLIGHTS		UMB Financial Corporation
(unaudited, dollars in thousands, except share and per share data)

 

Nine Months Ended September 30		2014				2013
Net interest income		$	259,141			$	247,355
Provision for loan losses			14,000				13,500
Noninterest income			383,440				356,226
Noninterest expense			500,213				453,752
Income before income taxes			128,368				136,329
Net income			93,715				99,302
Net income per share—Basic			2.09				2.47
Net income per share—Diluted			2.06				2.44
Return on average assets			0.79	%			0.89	%
Return on average equity			7.92	%			10.39	%
Three Months Ended September 30
Net interest income		$	87,526			$	85,545
Provision for loan losses			4,500				6,500
Noninterest income			126,475				121,625
Noninterest expense			161,461				153,063
Income before income taxes			48,040				47,607
Net income			35,630				34,432
Net income per share—Basic			0.79				0.85
Net income per share—Diluted			0.78				0.83
Return on average assets			0.90	%			0.92	%
Return on average equity			8.77	%			10.84	%
At September 30
Assets		$	16,284,028			$	16,184,233
Loans, net of unearned interest			7,103,163				6,506,902
Securities			7,100,746				6,960,462
Deposits			12,753,437				13,041,044
Shareholders’ equity			1,615,349				1,463,655
Book value per share			35.51				32.85
Market price per share			54.55				54.34
Equity to assets			9.92	%			9.04	%
Allowance for loan losses		$	77,316			$	74,938
As a % of loans			1.09	%			1.15	%
Nonaccrual and restructured loans		$	32,662			$	31,260
As a % of loans			0.46	%			0.48	%
Loans over 90 days past due		$	4,678			$	3,780
As a % of loans			0.07	%			0.06	%
Other real estate owned		$	1,369			$	1,441
Net loan charge-offs quarter-to-date		$	3,985			$	3,209
As a % of average loans			0.23	%			0.20	%
Net loan charge-offs year-to-date		$	11,434			$	9,988
As a % of average loans			0.22	%			0.22	%
Common shares outstanding			45,485,313				44,554,834
Average Balances Nine Months Ended September 30
Assets		$	15,920,788			$	14,861,254
Loans, net of unearned interest			6,858,874				6,132,892
Securities			7,009,947				7,043,908
Deposits			12,637,775				11,671,301
Shareholders’ equity			1,582,172				1,277,445

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Business Segment Information		UMB Financial Corporation
(unaudited, dollars in thousands)

 

		Three Months Ended September 30, 2014
		Bank				Payment Solutions				Institutional Investment Management				Asset Servicing				Total
Net interest income		$	72,906			$	13,442			$	—			$	1,178			$	87,526
Provision for loan losses			2,446				2,054				—				—				4,500
Noninterest income			48,385				21,579				33,919				22,592				126,475
Noninterest expense			99,307				22,056				20,910				19,188				161,461
Income before taxes			19,538				10,911				13,009				4,582				48,040
Income tax expense			5,081				2,795				3,350				1,184				12,410
Net income		$	14,457			$	8,116			$	9,659			$	3,398			$	35,630
Average assets		$	11,639,000			$	2,823,000			$	74,000			$	1,102,000			$	15,638,000
		Three Months Ended September 30, 2013
		Bank				Payment Solutions				Institutional Investment Management				Asset Servicing				Total
Net interest income		$	73,419			$	11,587			$	(11	)		$	550			$	85,545
Provision for loan losses			1,833				4,667				—				—				6,500
Noninterest income			48,945				18,409				33,842				20,429				121,625
Noninterest expense			93,150				21,658				21,054				17,201				153,063
Income before taxes			27,381				3,671				12,777				3,778				47,607
Income tax expense			6,922				1,283				3,506				1,464				13,175
Net income		$	20,459			$	2,388			$	9,271			$	2,314			$	34,432
Average assets		$	11,128,000			$	1,727,000			$	76,000			$	1,993,000			$	14,924,000
		Nine Months Ended September 30, 2014
		Bank				Payment Solutions				Institutional Investment Management				Asset Servicing				Total
Net interest income		$	216,508			$	38,220			$	(3	)		$	4,416			$	259,141
Provision for loan losses			7,558				6,442				—				—				14,000
Noninterest income			151,843				62,998				102,014				66,585				383,440
Noninterest expense			308,013				67,680				68,848				55,672				500,213
Income before taxes			52,780				27,096				33,163				15,329				128,368
Income tax expense			14,326				7,272				8,887				4,168				34,653
Net income		$	38,454			$	19,824			$	24,276			$	11,161			$	93,715
Average assets		$	11,914,000			$	2,350,000			$	74,000			$	1,583,000			$	15,921,000
		Nine Months Ended September 30, 2013
		Bank				Payment Solutions				Institutional Investment Management				Asset Servicing				Total
Net interest income		$	211,238			$	34,327			$	(22	)		$	1,812			$	247,355
Provision for loan losses			3,770				9,730				—				—				13,500
Noninterest income			148,129				56,486				91,550				60,061				356,226
Noninterest expense			277,226				63,626				58,754				54,146				453,752
Income before taxes			78,371				17,457				32,774				7,727				136,329
Income tax expense			19,629				5,464				8,880				3,054				37,027
Net income		$	58,742			$	11,993			$	23,894			$	4,673			$	99,302
Average assets		$	11,145,000			$	1,770,000			$	79,000			$	1,867,000			$	14,861,000

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