Quality endures. First Quarter 2014 UMB Financial Exhibit 99.3 |
Cautionary Notice about Forward-Looking Statements 2 This presentation 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 Securities and Exchange Commission (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. |
Earnings Summary $ in thousands, except per-share data; unaudited 3 1Q14 4Q13 1Q13 vs. 4Q13 vs. 1Q13 Net Interest Income 85,445 $ 85,914 $ 79,483 $ (0.5) 7.5 Noninterest Income 122,964 135,607 121,016 (9.3) 1.6 Total Revenue 208,409 221,521 200,499 (5.9) 3.9 Noninterest Expense 172,241 170,426 150,378 1.1 14.5 Operating Income 36,168 51,095 50,121 (29.2) (27.8) Provision for loan losses 4,500 4,000 2,000 12.5 125.0 Income before Taxes 31,668 47,095 48,121 (32.8) (34.2) Income Tax Expense 8,255 12,432 13,180 (33.6) (37.4) Net Income 23,413 $ 34,663 $ 34,941 $ (32.5) (33.0) Diluted EPS 0.52 $ 0.77 $ 0.87 $ (32.5) (40.2) Dividends per share 0.225 0.225 0.215 - 4.7 WASO 44,742,068 44,511,742 39,881,505 0.5 12.2 % variance |
Net Interest Income 4 +7.5% Net Interest Income 1Q’14 vs. 1Q’13 • Loan Growth • Improved deposit pricing $78.4 $79.9 $79.1 $79.5 $79.1 $80.4 $80.4 $80.2 $79.5 $82.3 $85.5 $85.9 $85.4 2.90% 2.98% 2.98% 2.91% 2.75% 2.82% 2.80% 2.64% 2.51% 2.56% 2.61% 2.51% 2.39% $65.0 $70.0 $75.0 $80.0 $85.0 $90.0 1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Net Interest Income NIM% |
Noninterest Income Highlights 5 Year CAGR 23.5% Trust & Securities Processing Revenue Trust & Securities Processing Composition: Equity Earnings/Alternatives Trading & Investment Banking Other Deposit Service Charges Trust & Securities Processing Brokerage Fees Gains on Sale of Securities Bankcard Fees $71.6 million in 1Q14 Primary components: Insurance Fees 5 58.2% 17.5% 12.7% 3.5% 2.8% 2.1% 1.5% 1.2% 0.5% $24.9 $35.6 $51.7 $54.7 $62.3 $71.6 the Bank segment •$16.9M – Personal & Institutional Asset Mgmt in •$20.9M – Asset Servicing •$33.8M - Institutional Investment Management |
NI Expense CAGR 10.1% Noninterest Expense Noninterest expense increased 14.5% to $172.2 million vs. 1Q’13 • Salary and benefit expense increased $5.2 million or 6.2% compared to 1Q’13 • Expense for contingent consideration liabilities on acquisitions was $4.5 million in 1Q’14 compared to just $3.3 million a year ago • Expense for a contingency reserve related to Prairie Capital Management added $15 million to expense in 1Q’14 Salary CAGR 8.9% NI Income CAGR 12.3% Managed FTE Costs; Growing Noninterest Income 6 * Noninterest Income/Noninterest Expense 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% $40 $60 $80 $100 $120 $140 $160 $180 Salary/Benefit Expense Noninterest Income Total Noninterest Expense Coverage Ratio* |
Select Balance Sheet Items 7 $ in thousands, average balances; unaudited vs. 4Q13 vs. 1Q13 Avg. Balance Avg. Balance Avg. Balance Assets Loans, net of unearned interest 6,678,932 $ 3.58 6,483,711 $ 3.62 5,814,855 $ 3.82 3.0 14.9 Total securities 6,997,052 1.98 6,969,863 1.97 6,866,546 1.98 0.4 1.9 Total earning assets 15,438,211 2.48 14,453,720 2.60 13,731,068 2.64 6.8 12.4 Allowance for loan losses (74,997) (75,135) (71,504) (0.2) 4.9 Total assets 16,504,251 $ 15,533,761 $ 14,783,017 $ 6.2 11.6 Liabilities and Shareholders' Equity Interest-bearing deposits 7,968,400 $ 0.16 7,795,495 $ 0.15 7,018,471 $ 0.22 2.2 13.5 Total interest-bearing liabilities 9,641,869 0.15 8,973,635 0.14 8,696,925 0.21 7.4 10.9 Noninterest-bearing demand deposits 5,167,513 4,903,429 4,626,556 5.4 11.7 Shareholders' Equity 1,547,722 1,514,145 1,282,397 2.2 20.7 Total liabilities and shareholders' equity 16,504,251 $ 15,533,761 $ 14,783,017 $ 6.2 11.6 Net interest spread 2.33 2.47 2.43 Net interest margin 2.39 2.51 2.51 % variance 1Q14 4Q13 1Q13 Avg Yield / Rate % Avg Yield / Rate % Avg Yield / Rate % |
Consistent Loan Growth 5 Year CAGR 8.6% 8 $4.4 $4.6 $5.1 $5.8 $6.7 3.0% 3.5% 4.0% 4.5% 5.0% 5.5% 6.0% 6.5% 7.0% Average Net Loans Average Loan Yield |
Average Balance, AFS: $6.7 billion Average Yield: 1.89% Investment Mix Securities Available for Sale, At March 31, 2014 Agencies High Quality Investment Portfolio 9 Securities Gains $ in thousands 1Q13 5,893 $ 2Q13 1,519 $ 3Q13 1,140 $ 4Q13 (10) $ 1Q14 1,470 $ Roll off Purchased ($ millions) Yield ($ millions) Yield 2Q13 $340 2.13% $815 1.41% 3Q13 $265 1.85% $77 1.02% 4Q13 $308 2.04% $355 0.64% 1Q14 $528 1.53% $618 1.26% Scheduled Cash Flow 2Q14 $263 2.03% Next 12 months $1,058 2.01% CDs & Corporates Municipals Mortgage-Backed Securities Treasuries AFS Portfolio Statistics 45.8% 29.1% 15.1% 6.3% 3.7% Duration/Life (in months) at 03/31/14 Avg. Life Total 46.66 47.55 Duration Total 43.03 44.12 at 12/31/13 |
Key Metrics Credit Quality $ in thousands Performance Metrics Net Charge-Offs Nonperforming Loans ROAE/ROAA Efficiency Ratio/NIM 10 11.05% 9.31% 10.84% 9.08% 6.13% 0.96% 0.81% 0.92% 0.89% 0.58% 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Return on Avg Equity Return on Avg Assets 73.46% 73.50% 70.77% 73.64% 79.67% 2.51% 2.56% 2.61% 2.51% 2.39% 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Efficiency Ratio Net Interest Margin $3,545 $3,234 $3,209 $4,187 $3,737 0.25% 0.21% 0.20% 0.26% 0.23% 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Net Charge-offs NCOs/Avg Loans $27,580 $25,489 $31,260 $30,706 $30,153 0.46% 0.40% 0.48% 0.47% 0.45% 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Nonperforming Loans NPLs/Loans |
Business Segment Updates |
Bank Quarter 2014 Highlights $8.4 $9.5 $10.3 $11.6 $13.1 32.7% 32.3% 38.7% 39.7% 39.3% 1Q'10 1Q'11 1Q'12 1Q'13 1Q'14 Interest Bearing Non-Interest Bearing $4.4 $4.6 $5.1 $5.8 $6.7 1Q'10 1Q'11 1Q'12 1Q'13 1Q'14 Average Net Loans $ in billions Average Deposits $ in billions Bank Operating Results $ 3 mos Ended Dec 31, Y/Y Q/Q 2014 2013 2013 Net interest income 71,121 $ 67,260 $ 73,874 $ 5.7% -3.7% Provision for loan losses 2,426 309 1,340 685.1% 81.0% Noninterest income 47,420 52,748 62,405 -10.1% -24.0% Noninterest expense 107,753 91,536 99,139 17.7% 8.7% NI before taxes 8,362 28,163 35,800 -70.3% -76.6% Income tax expense 1,942 7,705 8,905 -74.8% -78.2% Net income 6,420 $ 20,458 $ 26,895 $ -68.6% -76.1% pre-tax profit margin 7.1% 23.5% 26.3% 3 mos Ended % Change March 31, in 000s, unaudited 5 yr CAGR 8.6% 5 yr CAGR 15.2% 12 1 st Default workouts in corporate trust continue to grow, with revenue of $761K in the quarter, an increase of 163% Expense for a contingency reserve related to Prairie Capital Mgmt added $15 million to expense in 1Q’14 Average net loans grew for the 16 th consecutive quarter, year-over-year, increasing 14.9% to $6.7 billion |
Bank - Lending Diverse Loan Book (Actual Loan Balances at March 31) 13 10.3% 2.2% 8.6% 4.5% 8.4% 0.9% 6.2% 4.4% 46.7% 54.7% 27.7% 25.4% $4.7 $5.1 $6.0 $6.8 1Q'11 1Q'12 1Q'13 1Q'14 Commercial & Industrial Commercial Real Estate Consumer Real Estate Credit Card Consumer - Other Home Equity |
Bank - Deposits Diverse Sources of Deposits (Average Deposits for Three Months Ended March 31) 14 2.7% 4.1% 2.7% 7.7% 5.8% 4.2% 4.2% 5.6% 6.9% 6.9% 29.4% 32.7% 35.7% 24.5% 11.9% 15.0% $8.4 $9.5 $10.3 $11.6 1Q'11 1Q'12 1Q'13 1Q'14 Commercial/Treasury Mgmt Consumer Banking Asset Servicing Private Wealth Mgmt Institutional Asset Mgmt Healthcare Svcs Small Business Banking Inst. Banking & Investor Services |
Bank – Commercial Banking High Growth Regions 1Q’14 vs. 1Q’13 • Arizona +48.6% Commercial Loans By Region • St. Louis +28.3% • Oklahoma +18.4% Loan Balances $ in billions, Average C&I and CRE Loan Balances for Three Months Ended March 31 15 47.2% 45.9% 44.1% 42.8% 41.6% 0% 50% 100% 1Q'10 1Q'11 1Q'12 1Q'13 1Q'14 KC CO STL Greater MO KS OK AZ NE TX $3.41 $3.61 $4.03 $4.71 $5.52 1Q'10 1Q'11 1Q'12 1Q'13 1Q'14 5 yr CAGR 1Q ‘09–1Q’14 10.2% |
Bank – Private Wealth Mgmt. & Consumer Banking 16 Assets Under Management $ in billions Home Equity Lines of Credit $ in billions $10.2B $10.9B $5,490 $5,366 $6,390 $7,044 $7,376 $1,744 $2,035 $2,219 $2,853 $3,195 $152 $188 $226 $351 $364 2010 2011 2012 2013 1Q14 Private Wealth & Institutional Asset Mgmt Prairie Capital Management Brokerage Assets $901 $971 $1,096 $1,173 $1,250 $444 $468 $531 $543 $559 49.3% 48.2% 48.5% 46.3% 44.7% 1Q '10 1Q '11 1Q '12 1Q '13 1Q '14 Commitments Balances Utilization $7.4B $7.6B $8.8B |
A B x C E AUM increased 25% year-over-year to $32.2 billion The Scout Equity Opportunity Fund was launched on March 28. Scout received approval for a UCITS structure during the quarter, allowing greater international distribution capabilities Institutional Investment Management 17 Total Scout Assets Under Management $ in billions 1 Quarter 2014 Highlights $25.7 $26.3 $29.3 $31.2 $32.2 1Q'13 2Q13 3Q13 4Q13 1Q14 st C E Institutional Investment Management Operating Results $ in 000s, unaudited 3 mos Ended Dec 31, Y/Y Q/Q 2014 2013 2013 Net Interest income (2) $ - $ (10) $ -80.0% Noninterest income 34,095 28,552 34,893 19.4% -2.3% Noninterest expense 25,894 18,845 29,583 37.4% -12.5% NI before taxes 8,199 9,707 5,300 -15.5% 54.7% Income tax expense 2,184 2,667 1,127 -18.1% 93.8% Net income 6,015 $ 7,040 $ 4,173 $ -14.6% 44.1% pre-tax profit margin 24.0% 34.0% 15.2% March 31, % Change 3 mos Ended |
AUM Drivers $ in millions $2,204.5 $996.1 Total Change ($millions) $25,746.8 $32,163.5 Total AUM ($millions) $567.3 $26,314.1 Institutional Investment Management 18 $2,994.8 $29,308.9 $1,858.5 $31,167.4 |
Total AUM $19.9B $19.7B $23.5B Institutional Investment Management 19 $31.2B $32.2B |
Equity Strategies International Mid Cap International ADR Emerging Markets Global Small Cap Other: 20 Fixed Income Strategies Core Plus Low Duration Long Duration Core Intermediate Unconstrained Global Aggregate Real Return Equity Fixed Income 52% 48% 66.2% 29.0% 2 .8% 1.8% 0.2% 32.4% 23.1% 20.2% 13.8% 5.9% 2.7% 1.8% 0.1% AUM by Strategy – As of 1Q’14 |
$1.04 $1.10 $1.06 $1.08 $1.31 $1.36 $1.29 $1.26 $1.58 $1.48 $1.37 $1.38 $1.79 $1.72 $1.64 $1.63 $2.10 $11.7 $14.7 $15.3 $16.6 $16.7 Purchase Volume ($ billions) Interchange ($ millions) Payment Solutions A B Total debit and credit purchase volume increased by 17% year-over-year to surpass $2 billion Balances in our FDIC sweep product have grown at a CAGR of 109% over the past 5 years, ending March at $23.7 billion 1 st Quarter 2014 Highlights 21 Durbin effective Healthcare deposits grew to $751M and healthcare assets grew to $57.1M, for a combined increase of 33.0% over 1Q’13 Payment Solutions Operating Results $ in 000s, unaudited 3 mos Ended Dec 31, Y/Y Q/Q 2014 2013 2013 Net interest income 12,388 $ 11,548 $ 11,505 $ 7.3% 7.7% Provision for loan losses 2,074 1,691 2,660 22.6% -22.0% Noninterest income 20,235 19,437 17,737 4.1% 14.1% Noninterest expense 21,015 20,117 23,121 4.5% -9.1% NI before taxes 9,534 9,177 3,461 3.9% 175.5% Income tax expense 2,609 2,534 1,271 3.0% 105.3% Net income 6,925 $ 6,643 $ 2,190 $ 4.2% 216.2% pre-tax profit margin 29.2% 29.6% 11.8% % Change March 31, 3 mos Ended Total Card Purchase Volume & Interchange Revenue |
Payment Solutions 22 Annual Purchase Volume by Card Type 43.6% 21.5% 18.6% 11.8% 2.0% 2.5% 27.1% 35.9% 19.2% 11.1% 3.5% 3.2% |
Asset Servicing A B Total AUA increased by 18% to $195.5 billion year-over-year UMB Fund Services was recognized as the Best Administrator in North America as part of the 2014 Hedgeweek Awards 1 st Quarter 2014 Highlights 23 Assets Under Administration $billions Asset Servicing Operating Results $ in 000s, unaudited 3 mos Ended Dec 31, Y/Y Q/Q 2014 2013 2013 Net interest income 1,938 $ 675 $ 545 $ 187.1% 255.6% Noninterest income 21,214 20,279 20,572 4.6% 3.1% Noninterest expense 17,579 19,880 18,583 -11.6% -5.4% NI before taxes 5,573 1,074 2,534 418.9% 119.9% Income tax expense 1,520 274 1,129 454.7% 34.6% Net income 4,053 $ 800 $ 1,405 $ 406.6% 188.5% pre-tax profit margin 24.1% 5.1% 12.0% % Change March 31, 3 mos Ended |
Asset Servicing Fund Accounting & Administration Alternative Asset Servicing Custody Transfer Agency 24 |
Building a company for the next 100 years. UMB Financial First Quarter 2014 |