United Bankshares, Inc. Announces Earnings for the Third Quarter and First Nine Months of 2022

Rhea-AI Summary

United Bankshares, Inc. (NASDAQ: UBSI) reported third-quarter 2022 earnings of $102.6 million, or $0.76 per diluted share, up from $95.6 million in Q2 2022. This performance was driven by a 16% annualized loan growth and a net interest margin of 3.78%, reflecting a 40 basis point increase. Non-performing loans improved to 0.35% of total loans. However, noninterest income fell by 25%, mainly due to decreased mortgage banking activities. The company remains well-capitalized with a risk-based capital ratio of 14.4%.

Positive

• Earnings increased by 7% from Q2 2022.
• Net interest income rose by 12% from Q2 2022.
• Non-performing loans dropped to 0.35% of total loans.
• Annualized return on average tangible equity reached 15.46%.

Negative

• Noninterest income declined by 25% from Q2 2022.
• Provision for credit losses rose to $7.7 million from a net benefit of $1.8 million in Q2 2022.

WASHINGTON & CHARLESTON, W.V.--(BUSINESS WIRE)-- United Bankshares, Inc. (NASDAQ: UBSI) (“United”), today reported earnings for the third quarter of 2022 of $102.6 million, or $0.76 per diluted share, as compared to earnings of $95.6 million, or $0.71 per diluted share, for the second quarter of 2022. The quarter was highlighted by continued broad-based loan growth, net interest margin expansion and strong credit quality metrics.

Annualized loan growth, excluding Paycheck Protection Program (“PPP”) loans, for the third quarter and first nine months of 2022 was 16% and 15%, respectively. Third quarter 2022 net interest margin of 3.78% increased 40 basis points from the second quarter of 2022. Non-performing loans as a percentage of loans and leases, net of unearned income was a low 0.35% at September 30, 2022.

Third quarter 2022 results produced annualized returns on average assets, average equity and average tangible equity, a non-GAAP measure, of 1.41%, 8.96% and 15.46%, respectively, compared to annualized returns on average assets, average equity and average tangible equity of 1.32%, 8.33% and 14.23%, respectively, for the second quarter of 2022.

“The third quarter of 2022 was another great quarter for UBSI,” stated Richard M. Adams, Jr., United’s Chief Executive Officer. “The company delivered strong results related to loan growth, margin expansion, expense control and asset quality. The vitality of our markets, the strength of our deposit franchise and our conservative and disciplined approach to running our business have served us well in this environment and will provide us opportunities going forward.”

Third quarter of 2022 compared to the second quarter of 2022

Net interest income for the third quarter of 2022 increased $25.7 million, or 12%, from the second quarter of 2022. Tax-equivalent net interest income, a non-GAAP measure which adjusts for the tax-favored status of income from certain loans and investments, for the third quarter of 2022 also increased $25.7 million, or 12%, from the second quarter of 2022. The increase in net interest income and tax-equivalent net interest income was primarily due to higher interest income on earning assets driven by rising market interest rates and a change in the asset mix to higher earning assets. This increase in net interest income and tax-equivalent net interest income was partially offset by higher interest expense primarily driven by deposit rate repricing as well as due to lower PPP loan fee income and lower acquired loan accretion. The interest rate spread of 3.52% for the third quarter of 2022 increased 28 basis points from the second quarter of 2022 due to a 56 basis point increase in the average yield on earning assets partially offset by a 28 basis point increase in the average cost of funds. A decrease in average earning assets of $188.1 million, or 1%, from the second quarter of 2022 was driven by a decrease of $818.5 million in short-term investments partially offset by increases in higher yielding average net loans and loans held for sale of $627.6 million. Net PPP loan fee income decreased $1.9 million to $1.6 million for the third quarter of 2022. Acquired loan accretion income decreased $1.3 million to $4.1 million for the third quarter of 2022. The net interest margin of 3.78% for the third quarter of 2022 was an increase of 40 basis points from the net interest margin of 3.38% for the second quarter of 2022.

The provision for credit losses was $7.7 million for the third quarter of 2022 as compared to a net benefit of $1.8 million for the second quarter of 2022. The increase in the provision for credit losses was primarily due to loan growth.

Noninterest income for the third quarter of 2022 decreased $10.9 million, or 25%, from the second quarter of 2022. The decrease in noninterest income was primarily due to decreases of $6.0 million in income from mortgage banking activities, $2.6 million in income from bank-owned life insurance (“BOLI”), $1.4 million in net (losses) gains on investment securities and $761 thousand in fees from deposit services. The decrease in income from mortgage banking activities was mainly due to lower mortgage loan origination and sale volume driven by the rising rate environment and a lower margin on loans sold in the secondary market. The decrease in BOLI income was primarily due to lower death benefits from the second quarter of 2022 and the impact of lower market values of underlying investments in the third quarter of 2022. The decrease in fees from deposit services reflects changes to United’s overdraft policy implemented during the third quarter of 2022.

Noninterest expense for the third quarter of 2022 decreased $4.0 million, or 3%, from the second quarter of 2022. The decrease in noninterest expense was primarily due to decreases of $8.8 million in the expense for the reserve for unfunded loan commitments and $3.0 million in employee compensation partially offset by an increase of $6.1 million in other noninterest expense. The decrease in the reserve for unfunded loan commitments reflects a decrease in the outstanding balance of loan commitments at quarter-end driven by loan fundings. The decrease in employee compensation was primarily due to lower employee commissions related to mortgage banking production. Other noninterest expense for the third quarter of 2022 included an accrual of $5.0 million related to a litigation matter with a former commercial customer.

For the third quarter of 2022, income tax expense was $25.9 million as compared to $23.5 million for the second quarter of 2022. The increase of $2.4 million was due to higher earnings and a higher effective tax rate. United’s effective tax rate was 20.2% and 19.8% for the third and second quarter of 2022, respectively.

Third quarter of 2022 compared to the third quarter of 2021

Earnings for the third quarter of 2022 were $102.6 million, or $0.76 per diluted share, as compared to earnings of $92.2 million, or $0.71 per diluted share, for the third quarter of 2021.

Net interest income for the third quarter of 2022 increased $59.0 million, or 33%, from the third quarter of 2021. Tax-equivalent net interest income for the third quarter of 2022 increased $59.1 million, or 32%, from the third quarter of 2021. United completed its acquisition of Community Bankers Trust Corporation (“Community Bankers Trust”) on December 3, 2021. The increase in net interest income and tax-equivalent net interest income was primarily due to the impact of higher average earning assets, driven by the Community Bankers Trust acquisition and organic loan growth, the impact of rising market interest rates on earning assets and a change in the asset mix to higher earning assets. These increases were partially offset by higher interest expense primarily driven by deposit rate repricing, lower PPP loan fee income and lower acquired loan accretion income. Average earning assets for the third quarter of 2022 increased $1.1 billion, or 4%, from the third quarter of 2021 due to a $2.5 billion increase in average net loans and loans held for sale and a $1.5 billion increase in average investment securities partially offset by a $2.9 billion decrease in average short-term investments. The interest rate spread for the third quarter of 2022 increased 69 basis points from the third quarter of 2021 to 3.52% due to a 96 basis point increase in the average yield on earning assets partially offset by a 27 basis point increase in the average cost of funds. Net PPP loan fee income was $1.6 million and $7.8 million for the third quarter of 2022 and 2021, respectively, a decrease of $6.2 million. Acquired loan accretion income was $4.1 million and $8.2 million for the third quarter of 2022 and 2021, respectively, a decrease of $4.1 million. The net interest margin of 3.78% for the third quarter of 2022 was an increase of 80 basis points from the net interest margin of 2.98% for the third quarter of 2021.

The provision for credit losses was $7.7 million for the third quarter of 2022 as compared to a net benefit of $7.8 million for the third quarter of 2021. The increase in the provision for credit losses in the third quarter of 2022 was primarily due to loan growth.

Noninterest income for the third quarter of 2022 was $32.7 million, which was a decrease of $35.9 million, or 52%, from the third quarter of 2021. The decrease in noninterest income was driven by a $35.6 million decrease in income from mortgage banking activities mainly due to lower mortgage loan origination and sale volume driven by the rising rate environment and a lower margin on loans sold in the secondary market.

Noninterest expense for the third quarter of 2022 was $137.2 million, a decrease of $5.1 million, or 4%, from the third quarter of 2021 primarily due to decreases of $7.8 million in employee compensation and $7.2 million in the expense for the reserve for unfunded loan commitments partially offset by an increase of $8.8 million in other noninterest expense. The decrease in employee compensation was primarily due to lower employee commissions related to mortgage banking production partially offset by additional employees from the Community Bankers Trust acquisition. The increase in other noninterest expense resulted from the previously mentioned litigation accrual in the third quarter of 2022 and higher amounts of certain general operating expenses.

For the third quarter of 2022, income tax expense was $25.9 million as compared to $23.6 million for the third quarter of 2021. The increase of $2.3 million was primarily due to higher earnings partially offset by a slightly lower effective tax rate. United’s effective tax rate was 20.2% for the third quarter of 2022 and 20.4% for the third quarter of 2021.

First nine months of 2022 compared to the first nine months of 2021

Earnings for the first nine months of 2022 were $279.9 million, or $2.06 per diluted share, as compared to earnings of $293.9 million, or $2.27 per diluted share, for the first nine months of 2021.

Net interest income for the first nine months of 2022 increased $88.0 million, or 16%, from the first nine months of 2021. Tax-equivalent net interest income for the first nine months of 2022 increased $88.1 million, or 16%, from the first nine months of 2021. The increase in net interest income and tax-equivalent net interest income was primarily due to the impact of rising market interest rates on earning assets, an increase in average earning assets from the Community Bankers Trust acquisition and organic loan growth and a change in the asset mix to higher earning assets. These increases were partially offset by lower PPP loan fee income, lower acquired loan accretion income and the impact of rising market interest rates on interest-bearing liabilities. Average earning assets for the first nine months of 2022 increased $1.8 billion, or 7%, from the first nine months of 2021 due to a $1.5 billion increase in average investment securities and a $1.3 billion increase in average net loans and loans held for sale partially offset by a $1.1 billion decrease in average short-term investments. The interest rate spread for the first nine months of 2022 increased 22 basis points from the first nine months of 2021 due to a 26 basis point increase in the average yield on earning assets partially offset by a 4 basis point increase in the average cost of funds. Net PPP loan fee income was $9.3 million and $28.2 million for the first nine months of 2022 and 2021, respectively, a decrease of $18.9 million. Acquired loan accretion income was $13.6 million and $27.6 million for the first nine months of 2022 and 2021, respectively, a decrease of $14.0 million. The net interest margin of 3.38% for the first nine months of 2022 was an increase of 24 basis points from the net interest margin of 3.14% for the first nine months of 2021.

The provision for credit losses was $2.5 million for the first nine months of 2022 as compared to a net benefit of $16.6 million for the first nine months of 2021.

Noninterest income for the first nine months of 2022 was $122.4 million, which was a decrease of $101.7 million, or 45%, from the first nine months of 2021. The decrease was driven by a $106.3 million decrease in income from mortgage banking activities mainly due to lower mortgage loan origination and sale volume driven by the rising rate environment and a lower margin on loans sold in the secondary market. Fees from deposit services for the first nine months of 2022 were $31.0 million, an increase of $2.9 million from the first nine months of 2021. BOLI income for the first nine months of 2022 was $7.8 million, an increase of $2.2 million from the first nine months of 2021 due to increased death benefits.

Noninterest expense for the first nine months of 2022 was $417.5 million, a decrease of $12.6 million, or 3%, from the first nine months of 2021 driven by decreases in employee compensation of $23.6 million and employee benefits of $7.4 million partially offset by an increase in other noninterest expense of $13.3 million. The decrease in employee compensation was due to lower employee commissions, incentives and overtime related to mortgage banking production partially offset by additional employees from the Community Bankers Trust acquisition. Employee benefits decreased primarily due to changes in deferred compensation plans resulting from market fluctuations. The increase in other noninterest expense resulted from the previously mentioned litigation accrual in the third quarter of 2022 and higher amounts of certain general operating expenses.

For the first nine months of 2022, income tax expense was $69.6 million as compared to $75.6 million for the first nine months of 2021 due to lower earnings and a lower effective tax rate. United’s effective tax rate was 19.9% for the first nine months of 2022 and 20.5% for the first nine months of 2021.

Credit Quality

United’s asset quality continues to be sound. At September 30, 2022, non-performing loans were $69.7 million, or 0.35% of loans & leases, net of unearned income, down from $90.8 million, or 0.50% of loans & leases, net of unearned income, at December 31, 2021. Total non-performing assets of $80.4 million, including OREO of $10.8 million at September 30, 2022, represented 0.28% of total assets as compared to non-performing assets of $105.6 million, including OREO of $14.8 million, or 0.36% of total assets at December 31, 2021.

As of September 30, 2022, the allowance for loan & lease losses was $219.6 million, or 1.11% of loans & leases, net of unearned income, as compared to $216.0 million, or 1.20% of loans & leases, net of unearned income, at December 31, 2021. Net charge-offs were $1.8 million for the third quarter of 2022 compared to net recoveries of $1.2 million for the third quarter of 2021. Net recoveries were $1.1 million for the first nine months of 2022 compared to net charge-offs of $8.6 million for the first nine months of 2021. Annualized net charge-offs (recoveries) as a percentage of average loans & leases, net of unearned income were 0.04% and (0.03)% for the third quarter of 2022 and 2021, respectively. Annualized net (recoveries) charge-offs as a percentage of average loans & leases, net of unearned income were (0.01)% and 0.07% for the for the first nine months of 2022 and 2021, respectively.

Capital

United continues to be well-capitalized based upon regulatory guidelines. United’s estimated risk-based capital ratio is 14.4% at September 30, 2022, while estimated Common Equity Tier 1 capital, Tier 1 capital and leverage ratios are 12.4%, 12.4% and 10.7%, respectively. The September 30, 2022 ratios reflect United’s election of a five-year transition provision, allowed by the Federal Reserve Board and other federal banking agencies in response to the COVID-19 pandemic, to delay for two years the full impact of CECL on regulatory capital, followed by a three-year transition period. The regulatory requirements for a well-capitalized financial institution are a risk-based capital ratio of 10.0%, a Common Equity Tier 1 capital ratio of 6.5%, a Tier 1 capital ratio of 8.0% and a leverage ratio of 5.0%.

During the first nine months of 2022 and 2021, United repurchased, under a previously announced stock repurchase plan, shares of its common stock. United did not repurchase any shares of its common stock during the third quarter of 2022 or 2021. During the first nine months of 2022, United repurchased approximately 2.3 million shares of its common stock at an average price per share of $34.69. During the first nine months of 2021, United repurchased approximately 306 thousand shares of its common stock at an average price per share of $32.52.

About United Bankshares, Inc.

As of September 30, 2022, United had consolidated assets of approximately $29.0 billion. United is the parent company of United Bank which comprises nearly 250 offices in Virginia, Maryland, Washington, D.C., North Carolina, South Carolina, Georgia, Pennsylvania, West Virginia, and Ohio. United’s stock is traded on the NASDAQ Global Select Market under the quotation symbol "UBSI".

Cautionary Statements

The Company is required under generally accepted accounting principles to evaluate subsequent events through the filing of its September 30, 2022 consolidated financial statements on Form 10-Q. As a result, the Company will continue to evaluate the impact of any subsequent events on critical accounting assumptions and estimates made as of September 30, 2022 and will adjust amounts preliminarily reported, if necessary.

Use of non-GAAP Financial Measures

This press release contains certain financial measures that are not recognized under U.S. generally accepted accounting principles ("GAAP"). Generally, United has presented these “non-GAAP” financial measures because it believes that these measures provide meaningful additional information to assist in the evaluation of United’s results of operations or financial position. Presentation of these non-GAAP financial measures is consistent with how United’s management evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the banking industry.

Specifically, this press release contains certain references to financial measures identified as tax-equivalent (FTE) net interest income, average tangible equity, return on average tangible equity and tangible book value per share. Management believes these non-GAAP financial measures to be helpful in understanding United’s results of operations or financial position.

Net interest income is presented in this press release on a tax-equivalent basis. The tax-equivalent basis adjusts for the tax-favored status of income from certain loans and investments. Although this is a non-GAAP measure, United’s management believes this measure is more widely used within the financial services industry and provides better comparability of net interest income arising from taxable and tax-exempt sources. United uses this measure to monitor net interest income performance and to manage its balance sheet composition. The tax-equivalent adjustment combines amounts of interest income on federally nontaxable loans and investment securities using the statutory federal income tax rate of 21%.

Tangible equity is calculated as GAAP total shareholders’ equity minus total intangible assets. Tangible equity can thus be considered the most conservative valuation of the company. Tangible equity is also presented on a per common share basis and considering net income, a return on average tangible equity. Management provides these amounts to facilitate the understanding of as well as to assess the quality and composition of United’s capital structure. By removing the effect of intangible assets that result from merger and acquisition activity, the “permanent” items of equity are presented. These measures, along with others, are used by management to analyze capital adequacy and performance.

Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as reconciliation to that comparable GAAP financial measure can be found in the attached financial information tables to this press release. Investors should recognize that United’s presentation of these non-GAAP financial measures might not be comparable to similarly titled measures at other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and United strongly encourages a review of its condensed consolidated financial statements in their entirety.

Forward-Looking Statements

In this report, we have made various statements regarding current expectations or forecasts of future events, which speak only as of the date the statements are made. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are also made from time-to-time in press releases and in oral statements made by the officers of the Company. Forward-looking statements can be identified by the use of the words “expect,” “may,” “could,” “intend,” “project,” “estimate,” “believe,” “anticipate,” and other words of similar meaning. Such forward-looking statements are based on assumptions and estimates, which although believed to be reasonable, may turn out to be incorrect. Therefore, undue reliance should not be placed upon these estimates and statements. United cannot assure that any of these statements, estimates, or beliefs will be realized and actual results may differ from those contemplated in these “forward-looking statements.” The following factors, among others, could cause the actual results of United’s operations to differ materially from its expectations: the uncertainty as to the extent of the duration, scope and impacts of the COVID-19 pandemic on United, its colleagues, the communities United serves, and the domestic and global economy; uncertainty in U.S. fiscal and monetary policies, including the interest rate policies of the Federal Reserve Board; volatility and disruptions in global capital and credit markets, interest rate, securities market and monetary supply fluctuations; increasing rates of inflation and slower growth rates; reform of LIBOR; the nature, extent, timing, and results of governmental actions, examinations, reviews, reforms, regulations, and interpretations, including those involving the Federal Reserve, FDIC, and CFPB; the effect of changes in the level of checking or savings account deposits on United’s funding costs and net interest margin; future provisions for credit losses on loans and debt securities; changes in nonperforming assets; competition; and changes in legislation or regulatory requirements. For more information about factors that could cause actual results to differ materially from United’s expectations, refer to its reports filed with the Securities and Exchange Commission, including the discussion under “Risk Factors” in the Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the Securities and Exchange Commission and available on its website at www.sec.gov. Further, any forward-looking statement speaks only as of the date on which it is made, and United undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise. You are advised to consult further disclosures United may make on related subjects in our filings with the SEC.

UNITED BANKSHARES, INC. AND SUBSIDIARIES Washington, D.C. and Charleston, WV Stock Symbol: UBSI (In Thousands Except for Per Share Data)
		Three Months Ended													Nine Months Ended
EARNINGS SUMMARY:		September 2022				September 2021				June 2022					September 2022				September 2021
Interest income		$	263,683			$	194,080			$		227,771			$	694,249			$	599,923
Interest expense			23,061				12,501					12,868				47,222				40,867
Net interest income			240,622				181,579					214,903				647,027				559,056
Provision for credit losses			7,671				(7,829	)				(1,807	)			2,454				(16,565	)
Noninterest income			32,749				68,631					43,608				122,382				224,075
Noninterest expense			137,196				142,283					141,174				417,545				430,186
Income before income taxes			128,504				115,756					119,144				349,410				369,510
Income taxes			25,919				23,604					23,531				69,548				75,624
Net income		$	102,585			$	92,152			$		95,613			$	279,862			$	293,886
PER COMMON SHARE:
Net income:
Basic		$	0.76			$	0.71			$		0.71			$	2.07			$	2.28
Diluted			0.76				0.71					0.71				2.06				2.27
Cash dividends		$	0.36			$	0.35					0.36				1.08				1.05
Book value												33.34				32.98				34.29
Closing market price										$		35.07			$	35.75			$	36.38
Common shares outstanding:
Actual at period end, net of treasury shares												134,580,646				134,631,647				129,203,774
Weighted average-basic			134,182,248				128,762,815					134,623,061				134,947,674				128,716,450
Weighted average-diluted			134,553,565				128,960,220					134,863,650				135,251,299				128,934,282
FINANCIAL RATIOS:
Return on average assets			1.41	%			1.33	%				1.32	%			1.29	%			1.46	%
Return on average shareholders’ equity			8.96	%			8.23	%				8.33	%			8.07	%			8.95	%
Return on average tangible equity (non-GAAP)(1)			15.46	%			14.03	%				14.23	%			13.73	%			15.36	%
Average equity to average assets			15.75	%			16.18	%				15.88	%			15.95	%			16.27	%
Net interest margin			3.78	%			2.98	%				3.38	%			3.38	%			3.14	%
PERIOD END BALANCES:						September 30:2022				December 31 2021					September 30 2021				June 30 2022
Assets						$	29,048,475			$		29,328,902			$	27,507,517			$	28,777,896
Earning assets							25,648,264					26,083,089				24,415,973				25,356,669
Loans & leases, net of unearned income							19,700,080					18,023,648				16,743,629				18,970,395
Loans held for sale							210,075					504,416				493,299				220,689
Investment securities							4,923,694					4,295,749				3,646,065				5,073,618
Total deposits							22,863,377					23,350,263				21,822,609				23,026,649
Shareholders’ equity							4,440,086					4,718,628				4,430,766				4,487,050

Note: (1) See information under the “Selected Financial Ratios” table for a reconciliation of non-GAAP measure.

UNITED BANKSHARES, INC. AND SUBSIDIARIES Washington, D.C. and Charleston, WV Stock Symbol: UBSI (In Thousands Except for Per Share Data)
Consolidated Statements of Income	Three Months Ended																Nine Months Ended
	September				September				June				March				September				September
	2022				2021				2022				2022				2022				2021
Interest & Loan Fees Income (GAAP)	$	263,683			$	194,080			$	227,771			$	202,795			$	694,249			$	599,923
Tax equivalent adjustment		1,105				1,059				1,104				1,109				3,318				3,181
Interest & Fees Income (FTE) (non-GAAP)		264,788				195,139				228,875				203,904				697,567				603,104
Interest Expense		23,061				12,501				12,868				11,293				47,222				40,867
Net Interest Income (FTE) (non-GAAP)		241,727				182,638				216,007				192,611				650,345				562,237
Provision for Credit Losses		7,671				(7,829	)			(1,807	)			(3,410	)			2,454				(16,565	)
Noninterest Income:
Fees from trust services		4,384				4,269				4,294				4,127				12,805				12,225
Fees from brokerage services		4,016				3,883				4,115				4,552				12,683				11,860
Fees from deposit services		10,069				9,888				10,830				10,148				31,047				28,180
Bankcard fees and merchant discounts		1,857				1,473				1,671				1,379				4,907				3,905
Other charges, commissions, and fees		918				703				785				759				2,462				2,237
Income from bank-owned life insurance		1,472				2,556				4,120				2,194				7,786				5,617
Income from mortgage banking activities		6,422				42,012				12,445				19,203				38,070				144,350
Mortgage loan servicing income		2,302				2,429				2,328				2,387				7,017				7,170
Net (losses) gains on investment securities		(206	)			82				1,182				(251	)			725				2,715
Other noninterest income		1,515				1,336				1,838				1,527				4,880				5,816
Total Noninterest Income		32,749				68,631				43,608				46,025				122,382				224,075
Noninterest Expense:
Employee compensation		59,618				67,459				62,632				62,621				184,871				208,428
Employee benefits		10,750				13,132				12,047				12,851				35,648				43,052
Net occupancy		11,281				10,339				11,206				11,187				33,674				31,381
Data processing		7,614				6,612				7,549				7,371				22,534				20,594
Amortization of intangibles		1,379				1,466				1,379				1,379				4,137				4,399
OREO expense		1,708				428				46				182				1,936				4,483
Net losses (gains) on the sale of OREO properties		125				(34	)			(454	)			(33	)			(362	)			(67	)
Equipment expense		7,807				7,286				7,310				7,335				22,452				19,160
FDIC insurance expense		3,063				1,920				3,004				2,673				8,740				5,720
Mortgage loan servicing expense and impairment		1,847				3,253				1,783				1,643				5,273				10,029
Expense for the reserve for unfunded loan commitments		(2,881	)			4,294				5,899				5,237				8,255				5,941
Other noninterest expense		34,885				26,128				28,773				26,729				90,387				77,066
Total Noninterest Expense		137,196				142,283				141,174				139,175				417,545				430,186
Income Before Income Taxes (FTE) (non-GAAP)		129,609				116,815				120,248				102,871				352,728				372,691
Tax equivalent adjustment		1,105				1,059				1,104				1,109				3,318				3,181
Income Before Income Taxes (GAAP)		128,504				115,756				119,144				101,762				349,410				369,510
Taxes		25,919				23,604				23,531				20,098				69,548				75,624
Net Income	$	102,585			$	92,152			$	95,613			$	81,664			$	279,862			$	293,886
MEMO: Effective Tax Rate		20.17	%			20.39	%			19.75	%			19.75	%			19.90	%			20.47	%

UNITED BANKSHARES, INC. AND SUBSIDIARIES Washington, D.C. and Charleston, WV Stock Symbol: UBSI (In Thousands Except for Per Share Data)
Consolidated Balance Sheets
		September 2022				September 2021				September 30				December 31				September 30				June 30
		Q-T-D Average				Q-T-D Average				2022				2021				2021				2022
Cash & Cash Equivalents		$	1,260,311			$	4,132,702			$	1,356,347			$	3,758,170			$	4,033,561			$	1,658,486
Securities Available for Sale			4,826,072				3,344,196				4,648,087				4,042,699				3,409,984				4,812,704
Less: Allowance for credit losses			0				0				0				0				0				0
Net available for sale securities			4,826,072				3,344,196				4,648,087				4,042,699				3,409,984				4,812,704
Securities Held to Maturity			1,020				1,020				1,020				1,020				1,020				1,020
Less: Allowance for credit losses			(18	)			(31	)			(19	)			(19	)			(27	)			(18	)
Net held to maturity securities			1,002				989				1,001				1,001				993				1,002
Equity Securities			9,449				11,735				7,314				12,404				11,984				13,513
Other Investment Securities			251,405				222,765				267,292				239,645				223,104				246,399
Total Securities			5,087,928				3,579,685				4,923,694				4,295,749				3,646,065				5,073,618
Total Cash and Securities			6,348,239				7,712,387				6,280,041				8,053,919				7,679,626				6,732,104
Loans held for sale			203,420				445,983				210,075				504,416				493,299				220,689
Commercial Loans & Leases			14,410,508				12,621,706				14,531,221				13,809,735				12,657,238				14,136,614
Mortgage Loans			3,613,613				2,916,877				3,756,692				3,008,410				2,884,542				3,481,064
Consumer Loans			1,442,240				1,221,578				1,434,572				1,233,162				1,229,552				1,376,447
Gross Loans			19,466,361				16,760,161				19,722,485				18,051,307				16,771,332				18,994,125
Unearned income			(24,295	)			(31,288	)			(22,405	)			(27,659	)			(27,703	)			(23,730	)
Loans & Leases, net of unearned income			19,442,066				16,728,873				19,700,080				18,023,648				16,743,629				18,970,395
Allowance for Loan & Lease Losses			(213,824	)			(217,472	)			(219,611	)			(216,016	)			(210,891	)			(213,729	)
Net Loans			19,228,242				16,511,401				19,480,469				17,807,632				16,532,738				18,756,666
Mortgage Servicing Rights			22,369				22,479				21,908				23,144				22,836				22,593
Goodwill			1,888,889				1,810,040				1,888,889				1,886,494				1,810,040				1,888,889
Other Intangibles			21,165				23,409				20,276				24,413				22,524				21,655
Operating Lease Right-of-Use Asset			74,734				68,373				74,043				81,942				75,593				75,143
Other Real Estate Owned			13,508				17,618				10,779				14,823				16,696				13,847
Bank Owned Life Insurance			477,654				432,593				478,518				478,067				446,110				473,470
Other Assets			556,215				393,427				583,477				454,052				408,055				572,840
Total Assets		$	28,834,435			$	27,437,710			$	29,048,475			$	29,328,902			$	27,507,517			$	28,777,896
MEMO: Interest-earning Assets		$	25,438,281			$	24,362,333			$	25,648,264			$	26,083,089			$	24,415,973			$	25,356,669
Interest-bearing Deposits		$	13,756,151			$	13,361,016			$	13,533,152			$	14,369,716			$	13,332,418			$	13,995,710
Noninterest-bearing Deposits			9,216,058				8,471,744				9,330,225				8,980,547				8,490,191				9,030,939
Total Deposits			22,972,209				21,832,760				22,863,377				23,350,263				21,822,609				23,026,649
Short-term Borrowings			137,985				123,526				142,476				128,844				123,018				128,242
Long-term Borrowings			894,940				813,976				1,297,308				817,394				813,851				796,961
Total Borrowings			1,032,925				937,502				1,439,784				946,238				936,869				925,203
Operating Lease Liability			79,409				72,389				78,748				86,703				80,518				79,787
Other Liabilities			207,792				154,952				226,480				227,070				236,755				259,207
Total Liabilities			24,292,335				22,997,603				24,608,389				24,610,274				23,076,751				24,290,846
Preferred Equity			0				0				0				0				0				0
Common Equity			4,542,100				4,440,107				4,440,086				4,718,628				4,430,766				4,487,050
Total Shareholders' Equity			4,542,100				4,440,107				4,440,086				4,718,628				4,430,766				4,487,050
Total Liabilities & Equity		$	28,834,435			$	27,437,710			$	29,048,475			$	29,328,902			$	27,507,517			$	28,777,896
MEMO: Interest-bearing Liabilities		$	14,789,076			$	14,298,518			$	14,972,936			$	15,315,954			$	14,269,287			$	14,920,913

UNITED BANKSHARES, INC. AND SUBSIDIARIES Washington, D.C. and Charleston, WV Stock Symbol: UBSI (In Thousands Except for Per Share Data)
	Three Months Ended																Nine Months Ended
	September				September				June				March				September				September
Quarterly/Year-to-Date Share Data:	2022				2021				2022				2022				2022				2021
Earnings Per Share:
Basic	$	0.76			$	0.71			$	0.71			$	0.60			$	2.07			$	2.28
Diluted	$	0.76			$	0.71			$	0.71			$	0.60			$	2.06			$	2.27
Common Dividend Declared Per Share	$	0.36			$	0.35			$	0.36			$	0.36			$	1.08			$	1.05
High Common Stock Price	$	40.85			$	37.12			$	37.81			$	39.80			$	40.85			$	42.50
Low Common Stock Price	$	33.67			$	31.74			$	33.11			$	33.58			$	33.11			$	31.57
Average Shares Outstanding (Net of Treasury Stock):
Basic		134,182,248				128,762,815				134,623,061				136,058,328				134,947,674				128,716,450
Diluted		134,553,565				128,960,220				134,863,650				136,435,229				135,251,299				128,934,282
Common Dividends	$	48,564			$	45,271			$	48,544			$	49,266			$	146,374			$	135,793
Dividend Payout Ratio		47.34	%			49.13	%			50.77	%			60.33	%			52.30	%			46.21	%
									September 30				September 30				June 30				March 31
EOP Share Data:									2022				2021				2022				2022
Book Value Per Share									$	32.98			$	34.29			$	33.34			$	33.77
Tangible Book Value Per Share (non-GAAP) (1)									$	18.80			$	20.11			$	19.14			$	19.72
52-week High Common Stock Price									$	40.85			$	42.50			$	39.80			$	42.50
Date									8/16/22				05/18/21				01/13/22				05/18/21
52-week Low Common Stock Price									$	33.11			$	21.19			$	31.74			$	31.74
Date									5/2/22				10/01/20				09/20/21				9/20/21
EOP Shares Outstanding (Net of Treasury Stock):										134,631,647				129,203,774				134,580,646				136,068,439
Memorandum Items:
EOP Employees (full-time equivalent)										2,915				2,986				2,988				3,090
Note:
(1) Tangible Book Value Per Share:
Total Shareholders' Equity (GAAP)									$	4,440,086			$	4,430,766			$	4,487,050			$	4,595,140
Less: Total Intangibles										(1,909,165	)			(1,832,564	)			(1,910,544	)			(1,912,278	)
Tangible Equity (non-GAAP)									$	2,530,921			$	2,598,202			$	2,576,506			$	2,682,862
÷ EOP Shares Outstanding (Net of Treasury Stock)										134,631,647				129,203,774				134,580,646				136,068,439
Tangible Book Value Per Share (non-GAAP)									$	18.80			$	20.11			$	19.14			$	19.72

UNITED BANKSHARES, INC. AND SUBSIDIARIES Washington, D.C. and Charleston, WV Stock Symbol: UBSI (In Thousands Except for Per Share Data)
		Three Months Ended September 2022										Three Months Ended September 2021										Three Months Ended June 2022
Selected Average Balances and Yields:		Average							Average			Average							Average			Average							Average
ASSETS:		Balance				Interest(1)			Rate(1)			Balance				Interest(1)			Rate(1)			Balance				Interest(1)			Rate(1)
Earning Assets:
Federal funds sold and securities purchased under agreements to resell and other short-term investments		$	918,691			$	6,834		2.95	%		$	3,825,264			$	2,548		0.26	%		$	1,737,146			$	4,841		1.12	%
Investment securities:
Taxable			4,687,528				29,149		2.49	%			3,215,719				12,999		1.62	%			4,665,307				24,558		2.11	%
Tax-exempt			400,400				2,783		2.78	%			363,966				2,327		2.56	%			419,865				2,794		2.66	%
Total securities			5,087,928				31,932		2.51	%			3,579,685				15,326		1.71	%			5,085,172				27,352		2.15	%
Loans and loans held for sale, net of unearned income (2)			19,645,486				226,022		4.57	%			17,174,856				177,265		4.10	%			19,018,717				196,682		4.15	%
Allowance for loan losses			(213,824	)									(217,472	)									(214,624	)
Net loans and loans held for sale			19,431,662						4.62	%			16,957,384						4.15	%			18,804,093						4.19	%
Total earning assets			25,438,281			$	264,788		4.14	%			24,362,333			$	195,139		3.18	%			25,626,411			$	228,875		3.58	%
Other assets			3,396,154										3,075,377										3,383,037
TOTAL ASSETS		$	28,834,435									$	27,437,710									$	29,009,448
LIABILITIES:
Interest-Bearing Liabilities:
Interest-bearing deposits		$	13,756,151			$	17,660		0.51	%		$	13,361,016			$	9,803		0.29	%		$	14,136,707			$	9,751		0.28	%
Short-term borrowings			137,985				493		1.42	%			123,526				167		0.54	%			136,025				237		0.70	%
Long-term borrowings			894,940				4,908		2.18	%			813,976				2,531		1.23	%			811,924				2,880		1.42	%
Total interest-bearing liabilities			14,789,076				23,061		0.62	%			14,298,518				12,501		0.35	%			15,084,656				12,868		0.34	%
Noninterest-bearing deposits			9,216,058										8,471,744										9,038,947
Accrued expenses and other liabilities			287,201										227,341										279,659
TOTAL LIABILITIES			24,292,335										22,997,603										24,403,262
SHAREHOLDERS’ EQUITY			4,542,100										4,440,107										4,606,186
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	28,834,435									$	27,437,710									$	29,009,448
NET INTEREST INCOME						$	241,727									$	182,638									$	216,007
INTEREST RATE SPREAD									3.52	%									2.83	%									3.24	%
NET INTEREST MARGIN									3.78	%									2.98	%									3.38	%
(1) The interest income and the yields on federally nontaxable loans and investment securities are presented on a tax-equivalent basis using the statutory federal income tax rate of 21%.
(2) Nonaccruing loans are included in the daily average loan amounts outstanding.

UNITED BANKSHARES, INC. AND SUBSIDIARIES Washington, D.C. and Charleston, WV Stock Symbol: UBSI (In Thousands Except for Per Share Data)
		Nine Months Ended September 2022										Nine Months Ended September 2021
Selected Average Balances and Yields:		Average							Average			Average							Average
ASSETS:		Balance				Interest(1)			Rate(1)			Balance				Interest(1)			Rate(1)
Earning Assets:
Federal funds sold and securities purchased under agreements to resell and other short-term investments		$	1,887,158			$	14,004		0.99	%		$	3,012,429			$	6,198		0.28	%
Investment securities:
Taxable			4,540,767				71,212		2.09	%			3,085,050				40,371		1.74	%
Tax-exempt			421,440				8,266		2.62	%			337,590				6,639		2.62	%
Total securities			4,962,207				79,478		2.14	%			3,422,640				47,010		1.83	%
Loans and loans held for sale, net of unearned income (2)			19,068,898				604,085		4.23	%			17,742,054				549,896		4.14	%
Allowance for loan losses			(214,813	)									(228,163	)
Net loans and loans held for sale			18,854,085						4.28	%			17,513,891						4.20	%
Total earning assets			25,703,450			$	697,567		3.63	%			23,948,960			$	603,104		3.37	%
Other assets			3,358,118										3,032,927
TOTAL ASSETS		$	29,061,568									$	26,981,887
LIABILITIES:
Interest-Bearing Liabilities:
Interest-bearing deposits		$	14,089,933			$	35,972		0.34	%		$	13,255,751			$	32,800		0.33	%
Short-term borrowings			136,014				911		0.90	%			134,092				527		0.53	%
Long-term borrowings			841,693				10,339		1.64	%			820,426				7,540		1.23	%
Total interest-bearing liabilities			15,067,640				47,222		0.42	%			14,210,269				40,867		0.38	%
Noninterest-bearing deposits			9,082,869										8,147,540
Accrued expenses and other liabilities			275,201										234,991
TOTAL LIABILITIES			24,425,710										22,592,800
SHAREHOLDERS’ EQUITY			4,635,858										4,389,087
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	29,061,568									$	26,981,887
NET INTEREST INCOME						$	650,345									$	562,237
INTEREST RATE SPREAD									3.21	%									2.99	%
NET INTEREST MARGIN									3.38	%									3.14	%
(1) The interest income and the yields on federally nontaxable loans and investment securities are presented on a tax-equivalent basis using the statutory federal income tax rate of 21%.
(2) Nonaccruing loans are included in the daily average loan amounts outstanding.

UNITED BANKSHARES, INC. AND SUBSIDIARIES Washington, D.C. and Charleston, WV Stock Symbol: UBSI (In Thousands Except for Per Share Data)
		Three Months Ended																Nine Months Ended
		September				September				June				March				September				September
Selected Financial Ratios:		2022				2021				2022				2022				2022				2021
Return on Average Assets			1.41	%			1.33	%			1.32	%			1.13	%			1.29	%			1.46	%
Return on Average Shareholders’ Equity			8.96	%			8.23	%			8.33	%			6.96	%			8.07	%			8.95	%
Return on Average Tangible Equity (non-GAAP) (1)			15.46	%			14.03	%			14.23	%			11.63	%			13.73	%			15.36	%
Efficiency Ratio			50.19	%			56.87	%			54.61	%			58.59	%			54.27	%			54.93	%
Note:
(1) Return on Average Tangible Equity:
(a) Net Income (GAAP)		$	102,585			$	92,152			$	95,613			$	81,664			$	279,862			$	293,886
(b) Number of Days			92				92				91				90				273				273
Average Total Shareholders' Equity (GAAP)		$	4,542,100			$	4,440,107			$	4,606,186			$	4,759,780			$	4,635,858			$	4,389,087
Less: Average Total Intangibles			(1,910,054	)			(1,833,449	)			(1,911,705	)			(1,911,125	)			(1,910,957	)			(1,831,364	)
(c) Average Tangible Equity (non-GAAP)		$	2,632,046			$	2,606,658			$	2,694,481			$	2,848,655			$	2,724,901			$	2,557,723
Return on Average Tangible Equity (non-GAAP)\[(a) / (b)] x 365 / (c)			15.46	%			14.03	%			14.23	%			11.63	%			13.73	%			15.36	%
Selected Financial Ratios:										September 30 2022				December 31 2021				September 30 2021				June 30 2022
Loans & Leases, net of unearned income / Deposit Ratio											86.16	%			77.19	%			76.73	%			82.38	%
Allowance for Loan & Lease Losses/ Loans & Leases, net of unearned income											1.11	%			1.20	%			1.26	%			1.13	%
Allowance for Credit Losses (2)/ Loans & Leases, net of unearned income											1.32	%			1.37	%			1.41	%			1.35	%
Nonaccrual Loans / Loans & Leases, net of unearned income											0.14	%			0.20	%			0.23	%			0.15	%
90-Day Past Due Loans/ Loans & Leases, net of unearned income											0.09	%			0.10	%			0.09	%			0.09	%
Non-performing Loans/ Loans & Leases, net of unearned income											0.35	%			0.50	%			0.54	%			0.37	%
Non-performing Assets/ Total Assets											0.28	%			0.36	%			0.39	%			0.29	%
Primary Capital Ratio											16.03	%			16.79	%			16.82	%			16.34	%
Shareholders' Equity Ratio											15.29	%			16.09	%			16.11	%			15.59	%
Price / Book Ratio											1.08		x		1.05		x		1.06		x		1.05		x
Price / Earnings Ratio											11.75		x		12.82		x		12.76		x		12.37		x
Note:
(2) Includes allowances for loan losses and lending-related commitments.

UNITED BANKSHARES, INC. AND SUBSIDIARIES Washington, D.C. and Charleston, WV Stock Symbol: UBSI (In Thousands Except for Per Share Data)
		Three Months Ended																Nine Months Ended
		September				September				June				March				September				September
Mortgage Banking Segment Data:		2022				2021				2022				2022				2022				2021
Applications		$	785,529			$	1,893,870			$	1,159,102			$	1,696,504			$	3,641,135			$	6,554,142
Loans originated			552,487				1,385,871				955,152				1,006,363				2,514,002				4,954,618
Loans sold		$	564,267			$	1,470,928			$	1,072,623			$	1,170,124			$	2,807,014			$	5,166,584
Purchase money % of loans closed			86	%			69	%			86	%			73	%			81	%			59	%
Realized gain on sales and fees as a % of loans sold			2.13	%			3.00	%			2.40	%			2.98	%			2.49	%			3.37	%
Net interest income		$	2,758			$	2,367			$	2,870			$	2,317			$	7,945			$	7,888
Other income			13,749				45,023				21,468				23,397				58,614				152,295
Other expense			20,662				31,787				25,776				25,448				71,886				109,361
Income taxes			(820	)			3,179				(285	)			57				(1,048	)			10,399
Net (loss) income		$	(3,335	)		$	12,424			$	(1,153	)		$	209			$	(4,279	)		$	40,423
						September 30				December 31				September 30				June 30				March 31
Period End Mortgage Banking Segment Data:						2022				2021				2021				2022				2022
Locked pipeline						$	131,846			$	448,889			$	648,706			$	206,246			$	412,809
Balance of loans serviced						$	3,459,781			$	3,698,998			$	3,723,206			$	3,534,607			$	3,623,207
Number of loans serviced							23,859				25,198				25,583				24,226				24,677
						September 30				December 31				September 30				June 30				March 31
Asset Quality Data:						2022				2021				2021				2022				2022
EOP Non-Accrual Loans						$	28,244			$	36,028			$	37,689			$	28,386			$	34,093
EOP 90-Day Past Due Loans							18,254				18,879				14,827				16,443				15,179
EOP Restructured Loans (1)							23,155				35,856				37,752				25,504				30,582
Total EOP Non-performing Loans						$	69,653			$	90,763			$	90,268			$	70,333			$	79,854
EOP Other Real Estate Owned							10,779				14,823				16,696				13,847				13,641
Total EOP Non-performing Assets						$	80,432			$	105,586			$	106,964			$	84,180			$	93,495
		Three Months Ended																Nine Months Ended
		September				September				June				March				September				September
Allowance for Loan & Lease Losses:		2022				2021				2022				2022				2022				2021
Beginning Balance		$	213,729			$	217,545			$	214,594			$	216,016			$	216,016			$	235,830
Gross Charge-offs			(3,087	)			(2,004	)			(2,119	)			(1,476	)			(6,682	)			(15,092	)
Recoveries			1,299				3,173				3,060				3,456				7,815				6,498
Net (Charge-offs) Recoveries			(1,788	)			1,169				941				1,980				1,133				(8,594	)
Provision for Loan & Lease Losses			7,670				(7,823	)			(1,806	)			(3,402	)			2,462				(16,345	)
Ending Balance		$	219,611			$	210,891			$	213,729			$	214,594			$	219,611			$	210,891
Reserve for lending-related commitments			39,698				25,191				42,579				36,679				39,698				25,191
Allowance for Credit Losses (2)		$	259,309			$	236,082			$	256,308			$	251,273			$	259,309			$	236,082
Notes:
(1) Restructured loans with an aggregate balance of $10,336, $24,662, $22,421, $11,298 and $13,568 at September 30, 2022, September 30, 2021, December 31, 2021, June 30, 2022 and March 31, 2022 respectively, were on nonaccrual status, but are not included in “EOP Non-Accrual Loans” above. Restructured loans with an aggregate balance of $2,941, $102 and $3,162 at September 30, 2022, December 31, 2021 and June 30, 2022, respectively, were 90 days past due, but not included in "EOP Non-Accrual Loans" above.
(2) Includes allowances for loan losses and lending-related commitments.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20221027005187/en/

W. Mark Tatterson

Chief Financial Officer

(800) 445-1347 ext. 8716

Source: United Bankshares, Inc.

FAQ

What were United Bankshares' earnings for Q3 2022?

United Bankshares reported earnings of $102.6 million, or $0.76 per diluted share for Q3 2022.

How did United Bankshares' net interest margin perform in Q3 2022?

The net interest margin increased to 3.78%, up 40 basis points from Q2 2022.

What is the latest loan growth rate for United Bankshares?

United Bankshares reported an annualized loan growth of 16% for Q3 2022.

What was the provision for credit losses for Q3 2022?

The provision for credit losses for Q3 2022 was $7.7 million.

How much did noninterest income decrease in Q3 2022?

Noninterest income decreased by 25% compared to Q2 2022.