United Bankshares, Inc. · NASDAQ:UBSI
United Bankshares — Q1 2018 Earnings Presentation
17 slides from United Bankshares's earnings presentation, Apr 26, 2018
Slide 1: First Quarter 2018 Earnings Review
United Bankshares, Inc. First Quarter 2018 Earnings Review April 26, 2018 EXHIBIT 99.2
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation and statements made by United Bankshares, Inc. (“United”) and its management may contain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified
Slide 3: 1Q18 Highlights
1Q18 HIGHLIGHTS Record Net Income of $61.7 million with diluted earnings per share of $0.59 Generated return on average assets of 1.35%, return on equity of 7.65%, and return on tangible equity of 14.30% Quarterly dividend of $0.34 per share equates to a yield of 3.85% based upon recent stock price
Slide 4: Earnings Summary
EARNINGS SUMMARY Linked Quarter (LQ) Net Income increased from $18.0 million in 4Q17 to $61.7 million in 1Q18. The increase in Net Income was primarily due to lower tax expense, partially offset by lower loan accretion and two fewer days in the quarter. Diluted EPS were $0.59 in 1Q18 compared to $0.
Slide 5: Performance Ratios
PERFORMANCE RATIOS Strong and consistent profitability and expense control. 2Q17 was impacted by $23.2 million in pre-tax merger-related expenses. 4Q17 was impacted by $37.7 million in additional tax expense related to the Tax Act. *Non GAAP measure. Refer to appendix.
Slide 6: Net Interest Income and Margin
NET INTEREST INCOME AND MARGIN Reported Net Interest Margin decreased from 3.77% to 3.61% LQ. Decrease in Net Interest Margin LQ was primarily driven by decreased loan accretion (down $6.0 million). Net Interest Income linked quarter was impacted by 2 fewer days in the quarter and the aforementioned
Slide 7: Loan Summary
LOAN SUMMARY (excludes Loans Held for Sale) Strong loan pipeline heading into 2Q18. Residential real estate growth LQ driven by production from George Mason Mortgage Company. Loans consist of ARM products underwritten to agency guidelines. Non Owner Occupied CRE to Total Risk Based Capital was 279%
Slide 8: Deposit Summary
DEPOSIT SUMMARY UBSI maintains a strong core deposit base with 32% of deposits in Demand. Overall decrease in deposits primarily a result of fluctuations in large corporate accounts. Maintain the #7 deposit market share position in the Washington D.C. MSA. Maintain the #2 deposit market share positi
Slide 9: Enhancing Franchise Value
ENHANCING FRANCHISE VALUE Source: SNL Financial Deposit Market Share: Washington D.C. MSA Since 2014, United has completed 3 acquisitions in the Washington D.C. MSA, significantly increasing franchise value (Cardinal, Bank of Georgetown, & Virginia Commerce). Washington D.C. is ranked the 6th larges
Slide 10: Credit Quality
CREDIT QUALITY End of Period Balances (000s) 12/31/17 3/31/18 Non Accrual Loans $108,803 $100,172 90-Day Past Due Loans $9,803 $9,165 Restructured Loans $50,129 $48,271 Total Non Performing Loans $168,735 $157,608 Other Real Estate Owned $24,348 $22,778 Total Non Performing Assets $193,083 $180,386
Slide 11: Capital Ratios & Per Share Data
CAPITAL RATIOS & PER SHARE DATA End of Period Ratios / Values 12/31/17 3/31/18** Common Equity Tier 1 Ratio 12.0% 12.4% Tier 1 Capital Ratio 12.0% 12.4% Total Risk Based Capital Ratio 14.2% 14.6% Leverage Ratio 10.1% 10.5% Total Equity to Total Assets 17.0% 17.5% *Tangible Equity to Tangible Assets
Slide 12: George Mason Mortgage
GEORGE MASON MORTGAGE GMM remains the #1 purchase money lender in the Washington D.C. MSA. GMM originated portfolio ARM products for United Bank during 1Q18. This change in the mix of originations impacted gain on sale revenue for the business unit during the quarter. GMM gain on sale revenue and bu
Slide 13: 2018 Outlook
2018 OUTLOOK Loans & Deposits: Annual loan and deposit growth rate in 2018 expected in the low to mid single digits. Net Interest Margin: Stable core NIM (excluding purchase accounting related loan accretion). Asset Quality: Stable asset quality metrics (following improvement in 1Q18). Non Interest
Slide 14: UBSI Investment Thesis
UBSI INVESTMENT THESIS Excellent franchise with strong growth prospects Experienced management team with a proven track record of execution High level of insider ownership High-performance bank with a low-risk profile 44 consecutive years of dividend increases evidences United’s strong profitability
Slide 15: The Challenge to Be the Best Never Ends
THE CHALLENGE TO BE THE BEST NEVER ENDS www.ubsi-inc.com
Slide 16: Reconciliation of non-GAAP Items
Reconciliation of non-GAAP Items April 2018 (dollars in thousands) 3/31/2017 6/30/2017 9/30/2017 12/31/2017 3/31/2018 (1) Return on Average Tangible Equity (A) Net Income (GAAP) $38,809 $37,059 $56,738 $17,975 $61,706 (B) Number of Days in the Quarter 90 91 92 92 90 Average Total Shareholders' Equit
Slide 17: Reconciliation of non-GAAP Items (cont.)
Reconciliation of non-GAAP Items (cont.) April 2018 (dollars in thousands) 12/31/2017 3/31/2018 (2) Tangible Equity to Tangible Assets Total Assets (GAAP) $ 19,058,959 $ 18,619,702 Less: Total Intangibles (GAAP) (1,523,366) (1,521,556) Tangible Assets (non-GAAP) $ 17,535,593 $ 17,098,146 Total Share