Atlantic Union Bankshares 8K Reports Third Quarter Financial Results | AUB 19 Oct 23

Exhibit 99.1

Contact: Robert M. Gorman - (804) 523-7828

Executive Vice President / Chief Financial Officer

ATLANTIC UNION BANKSHARES REPORTS THIRD QUARTER FINANCIAL RESULTS

Richmond, Va., October 19, 2023 – Atlantic Union Bankshares Corporation (the “Company” or “Atlantic Union”) (NYSE: AUB) reported net income available to common shareholders of $51.1 million and basic and diluted earnings per common share of $0.68 for the third quarter of 2023 and adjusted operating earnings available to common shareholders⁽¹⁾ of $59.8 million and adjusted diluted operating earnings per common share⁽¹⁾ of $0.80 for the third quarter of 2023.

“Atlantic Union delivered strong operating results in the third quarter,” said John C. Asbury, president and chief executive officer of Atlantic Union. “We were especially pleased with our customer deposit growth that more than funded loan growth during the quarter, negligible charge-offs, and the impact of our expense reduction actions taken earlier in the year. The proactive measures we have taken to manage this challenging environment are serving us well.”

“We believe that our model of a diversified, traditional, full-service bank that delivers the products and services that our customers want and need combined with local decision making, responsiveness, and client service orientation positively sets us apart from other banks, both larger and smaller. Operating under the mantra of soundness, profitability, and growth – in that order of priority – Atlantic Union remains committed to generating sustainable, profitable growth and building long term value for our shareholders.”

STRATEGIC ACTIONS

Merger with American National Bankshares Inc. (“American National”)

On July 25, 2023, the Company announced that it entered into a merger agreement to acquire American National. During the third quarter of 2023, the Company incurred pre-tax merger costs of approximately $2.0 million.

Cost Saving Initiatives

As previously disclosed, the Company initiated a series of strategic cost savings measures during the second quarter of 2023 that is expected to reduce the annual expense run rate by approximately $17 million. As a result of these measures, the Company incurred pre-tax expenses of $8.7 million in the third quarter of 2023 and $3.9 million in the second quarter of 2023, principally composed of severance charges related to headcount reductions, costs related to modifying certain third-party vendor contracts, and charges for exiting certain leases.

Sale-Leaseback Transaction

On September 20, 2023, Atlantic Union Bank (the “Bank”) executed a sale-leaseback transaction and sold 27 properties, which consisted of 25 branches and a drive thru and parking lot, each adjacent to a sold branch, to a single purchaser for an aggregate purchase price of $45.8 million. Concurrently, the Bank entered into absolute net lease agreements with the purchaser under which the Bank will lease each of the properties for an initial term of 17 years with specified renewal options. The sale-leaseback transaction resulted in a pre-tax gain of approximately $27.7 million during the third quarter of 2023, after transaction-related expenses.

Available for Sale (“AFS”) Securities Sale

Concurrent with the sale-leaseback transaction, also on September 20, 2023, the Company restructured a portion of its investment portfolio by selling low yielding AFS securities with a book value of $228.3 million, resulting in a pre-tax net loss of $27.7 million. The net proceeds from the securities sale transaction were reinvested into higher yielding AFS securities at the end of the third quarter of 2023.

NET INTEREST INCOME

For the third quarter of 2023, net interest income was $151.9 million, a decrease of $143,000 from $152.1 million in the second quarter of 2023. Net interest income (FTE)⁽¹⁾was $155.7 million in the third quarter of 2023, a decrease of $65,000 from $155.8 million in the second quarter of 2023 due to higher deposit costs driven by increases in market interest rates, changes in the deposit mix as depositors continue to migrate to higher costing interest bearing deposit accounts, and growth in average deposit balances, partially offset by an increase in loan yields on variable rate loans due to increases in short-term interest rates during the quarter, as well as growth in average loans held for investment (“LHFI”). Our net interest margin decreased 10 basis points from the prior quarter to 3.27% at September 30, 2023, and our net interest margin (FTE)⁽¹⁾ decreased 10 basis points during the same period to 3.35%. Earning asset yields increased by 20 basis points to 5.39% in the third quarter of 2023 compared to the second quarter of 2023, primarily due to the impact of increases in market interest rates on loans and loan growth. Our cost of funds increased by 30 basis points to 2.04% at September 30, 2023 compared to the prior quarter, due primarily to higher deposit costs driven by higher rates and changes in the deposit mix as noted above.

The Company’s net interest margin (FTE)⁽¹⁾ includes the impact of acquisition accounting fair value adjustments. Net accretion related to acquisition accounting was $1.1 million for the third quarter of 2023. The impact of net accretion in the second and third quarters of 2023 are reflected in the following table (dollars in thousands):



	Loan		Deposit		Borrowings
	Accretion		Amortization		Amortization		Total
For the quarter ended June 30, 2023	$	1,073	$	(7)	$	(213)	$	853
For the quarter ended September 30, 2023		1,300		(6)		(215)		1,079

ASSET QUALITY

Overview

At September 30, 2023, nonperforming assets (“NPAs”) as a percentage of total LHFI was 0.19% and was unchanged from the prior quarter and included nonaccrual loans of $28.6 million. Accruing past due loans as a percentage of total LHFI totaled 27 basis points at September 30, 2023, an increase of 11 basis points from June 30, 2023, and an increase of 6 basis points from September 30, 2022. The increase in past due loan levels from June 30, 2023 was primarily within the 30-59 days past due category and resulted primarily from increases in past due credit relationships within the commercial real estate and commercial and industrial portfolios. Net charge-offs were 0.01% of total average LHFI (annualized) for the third quarter of 2023, a decrease of 3 basis points from June 30, 2023, and a decrease of 1 basis point from September 30, 2022. The allowance for credit losses (“ACL”) totaled $140.9 million at September 30, 2023, a $4.7 million increase from the prior quarter.

Nonperforming Assets

At September 30, 2023, NPAs totaled $28.8 million, compared to $29.2 million in the prior quarter. The following table shows a summary of NPA balances at the quarter ended (dollars in thousands):


	September 30,		June 30,		March 31,		December 31,		September 30,
	2023		2023		2023		2022		2022
Nonaccrual loans	$	28,626	$	29,105	$	29,082	$	27,038	$	26,500
Foreclosed properties		149		50		29		76		2,087
Total nonperforming assets	$	28,775	$	29,155	$	29,111	$	27,114	$	28,587

The following table shows the activity in nonaccrual loans for the quarter ended (dollars in thousands):


	September 30,		June 30,		March 31,		December 31,		September 30,
	2023		2023		2023		2022		2022
Beginning Balance	$	29,105	$	29,082	$	27,038	$	26,500	$	29,070
Net customer payments		(1,947)		(5,950)		(1,755)		(1,805)		(3,725)
Additions		1,651		6,685		4,151		2,935		1,302
Charge-offs		(64)		(712)		(39)		(461)		(125)
Loans returning to accruing status		(119)		—		(313)		(131)		—
Transfers to foreclosed property		—		—		—		—		(22)
Ending Balance	$	28,626	$	29,105	$	29,082	$	27,038	$	26,500

Past Due Loans

At September 30, 2023, past due loans still accruing interest totaled $40.6 million or 0.27% of total LHFI, compared to $24.1 million or 0.16% of total LHFI at June 30, 2023, and $29.0 million or 0.21% of total LHFI at September 30, 2022. The increase in past due loan levels from June 30, 2023 was primarily within the 30-59 days past due category and driven by increases in past due credit relationships within the commercial real estate and commercial and industrial portfolios. Of the total past due loans still accruing interest, $11.9 million or 0.08% of total LHFI were loans past due 90 days or more at September 30, 2023, compared to $10.1 million or 0.07% of total LHFI at June 30, 2023, and $7.4 million or 0.05% of total LHFI at September 30, 2022.

Allowance for Credit Losses

At September 30, 2023, the ACL was $140.9 million and included an allowance for loan and lease losses (“ALLL”) of $125.6 million and a reserve for unfunded commitments of $15.3 million. The ACL at September 30, 2023 increased $4.7 million from June 30, 2023 due to loan growth in the third quarter of 2023 and the impact of continued uncertainty in the economic outlook.

The ACL as a percentage of total LHFI was 0.92% at September 30, 2023, an increase of 2 basis points from June 30, 2023. The ALLL as a percentage of total LHFI was 0.82% at September 30, 2023, compared to 0.80% at June 30, 2023.

Net Charge-offs

Net charge-offs were $294,000 or 0.01% of total average LHFI on an annualized basis for the third quarter of 2023, compared to $1.6 million or 0.04% (annualized) for the second quarter of 2023, and $587,000 or 0.02% (annualized) for the third quarter of 2022.

Provision for Credit Losses

For the third quarter of 2023, the Company recorded a provision for credit losses of $5.0 million, compared to a provision for credit losses of $6.1 million in the prior quarter, and a provision for credit losses of $6.4 million in the third quarter of 2022.

NONINTEREST INCOME

Noninterest income increased $2.9 million to $27.1 million for the third quarter of 2023 from $24.2 million in the prior quarter, primarily driven by a $939,000 increase in other service charges, commissions and fees primarily due to a merchant services vendor contract signing bonus, a $714,000 increase in equity method investment income (included within other operating income), a $439,000 increase in service charges on deposits accounts, and a $379,000 increase in loan-related interest rate swap fees due to several new swap transactions. Noninterest income in the third quarter also included a $27.7 million gain related to the sale-leaseback transaction, included in other operating income, which was almost wholly offset by $27.6 million of losses incurred on the sale of AFS securities in the third quarter of 2023.

NONINTEREST EXPENSE

Noninterest expense increased $2.8 million to $108.5 million for the third quarter of 2023 from $105.7 million in the prior quarter, primarily driven by a $10.0 million increase in other expenses, which includes $8.7 million in expenses associated with strategic cost saving initiatives and $2.0 million in merger-related costs. Adjusted operating noninterest expense,⁽¹⁾ which excludes amortization of intangible assets ($2.2 million in both the third quarter and second quarter of 2023), expenses associated with strategic cost savings initiatives ($8.7 million in the third quarter and $3.9 million in the second quarter of 2023), and merger-related costs associated with the American National merger ($2.0 million in the third quarter of 2023), decreased $3.9 million to $95.7 million for the third quarter of 2023 from $99.5 million in the prior quarter. The decrease in adjusted operating noninterest expense⁽¹⁾ was primarily due to a $1.6 million decrease in salaries and benefits expense reflecting the impact of strategic cost saving initiatives, a $1.1 million decrease in professional services expense related to strategic projects in the prior quarter, a $643,000 decrease in technology and data processing expense, and a $598,000 decrease in marketing and advertising expense.

INCOME TAXES

The effective tax rate for the three months ended September 30, 2023 and 2022 was 17.6% and 17.0%, respectively, and the effective tax rate for the nine months ended September 30, 2023 and 2022 was 16.3% and 17.0%, respectively.

BALANCE SHEET

At September 30, 2023, total assets were $20.7 billion, an increase of $133.9 million or approximately 2.6% (annualized) from June 30, 2023, and an increase of $786.0 million or approximately 3.9% from September 30, 2022. Total assets increased from the prior quarter primarily due to a $216.7 million increase in LHFI (net of deferred fees and costs), partially offset by a $110.3 million decrease in investment securities due primarily to the decline in market value of the AFS securities portfolio due to the impact of market interest rates. Total assets increased from the prior year period primarily due to a $1.4 billion increase in LHFI (net of deferred fees and costs), partially offset by a $607.7 million decrease in investment securities due primarily to the sale of AFS securities in the first and third quarters of 2023.

At September 30, 2023, LHFI (net of deferred fees and costs) totaled $15.3 billion, an increase of $216.7 million or 5.7% (annualized) from $15.1 billion at June 30, 2023. Average LHFI (net of deferred fees and costs) totaled $15.1 billion at September 30, 2023, an increase of $393.5 million or 10.6% (annualized) from the prior quarter. At September 30, 2023, both LHFI (net of deferred fees and costs) and average LHFI (net of deferred fees and costs) increased $1.4 billion from September 30, 2022. LHFI (net of deferred fees and costs) increased from the prior quarter primarily due to increases in the multifamily real estate and other commercial portfolios and increased from the same period in the prior year primarily due to increases in the commercial and industrial and commercial real estate non-owner occupied portfolios.

At September 30, 2023, total investments were $3.0 billion, a decrease of $110.3 million from June 30, 2023 and a decrease of $607.7 million from September 30, 2022. AFS securities totaled $2.1 billion at September 30, 2023, $2.2 billion at June 30, 2023, and $2.7 billion at September 30, 2022. At September 30, 2023, total net unrealized losses on the AFS securities portfolio were $523.1 million, compared to $450.1 million at June 30, 2023 and $507.7 million at September 30, 2022. Held to maturity (“HTM”) securities are carried at cost and totaled $843.3 million at September 30, 2023, $849.6 million at June 30, 2023, and $841.3 million at September 30, 2022 and had net unrealized losses of $81.2 million at September 30, 2023, compared to $41.8 million at June 30, 2023 and $75.9 million at September 30, 2022.

At September 30, 2023, total deposits were $16.8 billion, an increase of $374.5 million or approximately 9.1% (annualized) from June 30, 2023. Average deposits at September 30, 2023 increased from the prior quarter by $515.5 million or 12.6% (annualized). Total deposits at September 30, 2023 increased $240.3 million or 1.5% from September 30, 2022, and quarterly average deposits at September 30, 2023 increased $307.4 million or 1.9% from the same period in the prior year. Total deposits increased from the prior quarter and the prior year period primarily due to increases in interest bearing customer deposits and brokered deposits, partially offset by decreases in demand deposits.

At September 30, 2023, total borrowings were $1.0 billion, a decrease of $299.6 million from June 30, 2023, and an increase of $351.1 million from September 30, 2022. Total borrowings decreased from the prior quarter primarily due to

paydowns of short-term borrowings due to deposit growth and increased from the prior year period due to increased short-term borrowings used to fund loan growth.

The following table shows the Company’s capital ratios at the quarters ended:


	September 30,		June 30,		September 30,
	2023		2023		2022
Common equity Tier 1 capital ratio ⁽²⁾	9.94	%	9.86	%	9.96	%
Tier 1 capital ratio ⁽²⁾	10.88	%	10.81	%	10.98	%
Total capital ratio ⁽²⁾	13.70	%	13.64	%	13.80	%
Leverage ratio (Tier 1 capital to average assets) ⁽²⁾	9.62	%	9.64	%	9.32	%
Common equity to total assets	10.72	%	10.96	%	10.60	%
Tangible common equity to tangible assets ⁽¹⁾	6.45	%	6.66	%	6.11	%

During the third quarter of 2023, the Company declared and paid a quarterly dividend on the outstanding shares of Series A Preferred Stock of $171.88 per share (equivalent to $0.43 per outstanding depositary share), consistent with the second quarter of 2023 and the third quarter of 2022. During the third quarter of 2023, the Company also declared and paid cash dividends of $0.30 per common share, consistent with the second quarter of 2023 and the third quarter of 2022.

⁽¹⁾ These are financial measures not calculated in accordance with generally accepted accounting principles (“GAAP”). For a reconciliation of these non-GAAP financial measures, see the “Alternative Performance Measures (non-GAAP)” section of the Key Financial Results.

⁽²⁾ All ratios at September 30, 2023 are estimates and subject to change pending the Company’s filing of its FR Y9-C. All other periods are presented as filed.

ABOUT ATLANTIC UNION BANKSHARES CORPORATION

Headquartered in Richmond, Virginia, Atlantic Union Bankshares Corporation (NYSE: AUB) is the holding company for Atlantic Union Bank. Atlantic Union Bank has 109 branches and 123 ATMs located throughout Virginia and in portions of Maryland and North Carolina as of September 30, 2023. Certain non-bank financial services affiliates of Atlantic Union Bank include: Atlantic Union Equipment Finance, Inc., which provides equipment financing; Atlantic Union Financial Consultants, LLC, which provides brokerage services; and Union Insurance Group, LLC, which offers various lines of insurance products.

THIRD QUARTER 2023 EARNINGS RELEASE CONFERENCE CALL

The Company will hold a conference call and webcast for investors at 9:00 a.m. Eastern Time on Thursday, October 19, 2023 during which the Company’s management will review the Company’s financial results for the third quarter 2023 and provide an update on recent activities.

The listen-only webcast and the accompanying slides can be accessed at:

https://edge.media-server.com/mmc/p/xamg8swa.

For analysts who wish to participate in the conference call, please register at the following URL:

https://register.vevent.com/register/BI2b71d4244e9e49b393decce9c92d4054. To participate in the conference call, you must use the link to receive an audio dial-in number and an Access PIN.

A replay of the webcast, and the accompanying slides, will be available on the Company’s website for 90 days at: https://investors.atlanticunionbank.com/.

NON-GAAP FINANCIAL MEASURES

In reporting the results as of and for the period ended September 30, 2023, the Company has provided supplemental performance measures on a tax-equivalent, tangible, operating, adjusted or pre-tax pre-provision basis. These non-GAAP

financial measures are a supplement to GAAP, which is used to prepare the Company’s financial statements, and should not be considered in isolation or as a substitute for comparable measures calculated in accordance with GAAP. In addition, the Company’s non-GAAP financial measures may not be comparable to non-GAAP financial measures of other companies. The Company uses the non-GAAP financial measures discussed herein in its analysis of the Company’s performance. The Company’s management believes that these non-GAAP financial measures provide additional understanding of ongoing operations, enhance comparability of results of operations with prior periods and show the effects of significant gains and charges in the periods presented without the impact of items or events that may obscure trends in the Company’s underlying performance. For a reconciliation of these measures to their most directly comparable GAAP measures and additional information about these non-GAAP financial measures, see “Alternative Performance Measures (non-GAAP)” in the tables within the section “Key Financial Results.”

FORWARD-LOOKING STATEMENTS

This press release and statements by our management may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include, without limitation, statements made in Mr. Asbury’s quotations, statements regarding our expectations with regard to our business, financial and operating results, including our deposit base, the impact of future economic conditions, the expected impact of our cost saving measures initiative in the second quarter of 2023, and statements that include other projections, predictions, expectations, or beliefs about future events or results or otherwise are not statements of historical fact. Such forward-looking statements are based on certain assumptions as of the time they are made, and are inherently subject to known and unknown risks, uncertainties, and other factors, some of which cannot be predicted or quantified, that may cause actual results, performance, or achievements to be materially different from those expressed or implied by such forward-looking statements. Forward-looking statements are often characterized by the use of qualified words (and their derivatives) such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” “intend,” “will,” “may,” “view,” “opportunity,” “potential,” “continue,” “confidence,” or words of similar meaning or other statements concerning opinions or judgment of the Company and our management about future events. Although we believe that our expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of our existing knowledge of our business and operations, there can be no assurance that actual future results, performance, or achievements of, or trends affecting, us will not differ materially from any projected future results, performance, achievements or trends expressed or implied by such forward-looking statements. Actual future results, performance, achievements or trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to, the effects of or changes in:

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market interest rates and their related impacts on macroeconomic conditions, customer and client behavior, our funding costs and our loan and securities portfolios;

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inflation and its impacts on economic growth and customer and client behavior;

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adverse developments in the financial industry generally, such as bank failures, responsive measures to mitigate and manage such developments, related supervisory and regulatory actions and costs, and related impacts on customer and client behavior;

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the sufficiency of liquidity;

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general economic and financial market conditions, in the United States generally and particularly in the markets in which we operate and which our loans are concentrated, including the effects of declines in real estate values, an increase in unemployment levels and slowdowns in economic growth;

●

the failure to close our previously announced merger with American National when expected or at all because required regulatory, American National shareholder or other approvals and other conditions to closing are not received or satisfied on a timely basis or at all, and the risk that any regulatory approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the proposed merger;

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the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the merger agreement between the Company and American National;

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any change in the purchase accounting assumptions used regarding the American National assets acquired and liabilities assumed to determine the fair value and credit marks, particularly in light of the current rising interest rate environment;

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the possibility that the anticipated benefits of the proposed merger, including anticipated cost savings and strategic gains, are not realized when expected or at all;

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the proposed merger being more expensive or taking longer to complete than anticipated, including as a result of unexpected factors or events;

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the diversion of management’s attention from ongoing business operations and opportunities do to the proposed merger;

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potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement or completion of the proposed merger;

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the dilutive effect of shares of the Company’s common stock to be issued at the completion of the proposed merger;

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changes in the Company’s or American National’s share price before closing;

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monetary and fiscal policies of the U.S. government, including policies of the U.S. Department of the Treasury and the Federal Reserve;

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the quality or composition of our loan or investment portfolios and changes therein;

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demand for loan products and financial services in our market areas;

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our ability to manage our growth or implement our growth strategy;

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the effectiveness of expense reduction plans;

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the introduction of new lines of business or new products and services;

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our ability to recruit and retain key employees;

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real estate values in our lending area;

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changes in accounting principles, standards, rules, and interpretations, and the related impact on our financial statements;

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an insufficient ACL or volatility in the ACL resulting from the CECL methodology, either alone or as that may be affected by inflation, changing interest rates, or other factors;

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our liquidity and capital positions;

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concentrations of loans secured by real estate, particularly commercial real estate;

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the effectiveness of our credit processes and management of our credit risk;

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our ability to compete in the market for financial services and increased competition from fintech companies;

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technological risks and developments, and cyber threats, attacks, or events;

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operational, technological, cultural, regulatory, legal, credit, and other risks associated with the exploration, consummation and integration of potential future acquisitions, whether involving stock or cash considerations;

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the potential adverse effects of unusual and infrequently occurring events, such as weather-related disasters, terrorist acts, geopolitical conflicts or public health events, and of governmental and societal responses thereto; these potential adverse effects may include, without limitation, adverse effects on the ability of our borrowers to satisfy their obligations to us, on the value of collateral securing loans, on the demand for our loans or our other products and services, on supply chains and methods used to distribute products and services, on incidents of cyberattack and fraud, on our liquidity or capital positions, on risks posed by reliance on third-party service providers, on other aspects of our business operations and on financial markets and economic growth;

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the discontinuation of LIBOR and its impact on the financial markets, and our ability to manage operational, legal, and compliance risks related to the discontinuation of LIBOR and implementation of one or more alternate reference rates;

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performance by our counterparties or vendors;

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deposit flows;

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the availability of financing and the terms thereof;

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the level of prepayments on loans and mortgage-backed securities;

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legislative or regulatory changes and requirements;

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actual or potential claims, damages, and fines related to litigation or government actions, which may result in, among other things, additional costs, fines, penalties, restrictions on our business activities, reputational harm, or other adverse consequences;

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the effects of changes in federal, state or local tax laws and regulations;

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any event or development that would cause us to conclude that there was an impairment of any asset, including intangible assets, such as goodwill; and

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other factors, many of which are beyond our control.

Please also refer to such other factors as discussed throughout Part I, Item 1A. “Risk Factors” and Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2022, Part II, Item 1A. Risk Factors in our Quarterly Reports on Form 10-Q for the quarters ended June 30, 2023 and March 31, 2023, and related disclosures in other filings, which have been filed with the U.S. Securities and Exchange Commission (“SEC”) and are available on the SEC’s website at www.sec.gov. All risk factors and uncertainties described herein and therein should be considered in evaluating forward-looking statements, and all of the forward-looking statements are expressly qualified by the cautionary statements

contained or referred to herein and therein. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on the Company or our businesses or operations. Readers are cautioned not to rely too heavily on the forward-looking statements, and undue reliance should not be placed on such forward-looking statements. Forward-looking statements speak only as of the date they are made. We do not intend or assume any obligation to update, revise or clarify any forward-looking statements that may be made from time to time by or on behalf of the Company, whether as a result of new information, future events or otherwise.

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)


	As of & For Three Months Ended									As of & For Nine Months Ended
	09/30/23			06/30/23			09/30/22			09/30/23			09/30/22
Results of Operations
Interest and dividend income	$	247,159		$	230,247		$	171,156		$	694,952		$	458,367
Interest expense		95,218			78,163			20,441			237,483			37,954
Net interest income		151,941			152,084			150,715			457,469			420,413
Provision for credit losses		4,991			6,069			6,412			22,911			12,771
Net interest income after provision for credit losses		146,950			146,015			144,303			434,558			407,642
Noninterest income		27,094			24,197			25,584			60,918			94,023
Noninterest expenses		108,508			105,661			99,923			322,442			304,012
Income before income taxes		65,536			64,551			69,964			173,034			197,653
Income tax expense		11,519			9,310			11,894			28,123			33,667
Net income		54,017			55,241			58,070			144,911			163,986
Dividends on preferred stock		2,967			2,967			2,967			8,901			8,901
Net income available to common shareholders	$	51,050		$	52,274		$	55,103		$	136,010		$	155,085

Interest earned on earning assets (FTE) ⁽¹⁾	$	250,903		$	233,913		$	174,998		$	706,150		$	469,122
Net interest income (FTE) ⁽¹⁾		155,685			155,750			154,557			468,667			431,168
Total revenue (FTE) ⁽¹⁾		182,779			179,947			180,141			529,585			525,191
Pre-tax pre-provision adjusted operating earnings ⁽⁷⁾		81,086			74,553			76,376			228,837			206,852

Key Ratios
Earnings per common share, diluted	$	0.68		$	0.70		$	0.74		$	1.81		$	2.07
Return on average assets (ROA)		1.04	%		1.10	%		1.15	%		0.95	%		1.10	%
Return on average equity (ROE)		8.76	%		9.00	%		9.45	%		7.93	%		8.72	%
Return on average tangible common equity (ROTCE) ^{(2) (3)}		15.71	%		16.11	%		17.21	%		14.22	%		15.69	%
Efficiency ratio		60.61	%		59.94	%		56.68	%		62.20	%		59.10	%
Efficiency ratio (FTE) ⁽¹⁾		59.37	%		58.72	%		55.47	%		60.89	%		57.89	%
Net interest margin		3.27	%		3.37	%		3.34	%		3.35	%		3.16	%
Net interest margin (FTE) ⁽¹⁾		3.35	%		3.45	%		3.43	%		3.43	%		3.24	%
Yields on earning assets (FTE) ⁽¹⁾		5.39	%		5.19	%		3.88	%		5.17	%		3.52	%
Cost of interest-bearing liabilities		2.80	%		2.42	%		0.68	%		2.42	%		0.43	%
Cost of deposits		1.97	%		1.61	%		0.37	%		1.63	%		0.21	%
Cost of funds		2.04	%		1.74	%		0.45	%		1.74	%		0.28	%

Operating Measures⁽⁴⁾
Adjusted operating earnings	$	62,749		$	58,348		$	58,070		$	171,286		$	160,355
Adjusted operating earnings available to common shareholders		59,782			55,381			55,103			162,385			151,454
Adjusted operating earnings per common share, diluted	$	0.80		$	0.74		$	0.74		$	2.17		$	2.02
Adjusted operating ROA		1.21	%		1.16	%		1.15	%		1.12	%		1.08	%
Adjusted operating ROE		10.17	%		9.51	%		9.45	%		9.37	%		8.53	%
Adjusted operating ROTCE ^{(2) (3)}		18.31	%		17.03	%		17.21	%		16.88	%		15.34	%
Adjusted operating efficiency ratio (FTE) ⁽¹⁾⁽⁶⁾		52.36	%		55.30	%		54.09	%		54.55	%		56.20	%

Per Share Data
Earnings per common share, basic	$	0.68		$	0.70		$	0.74		$	1.81		$	2.07
Earnings per common share, diluted		0.68			0.70			0.74			1.81			2.07
Cash dividends paid per common share		0.30			0.30			0.30			0.90			0.86
Market value per share		28.78			25.95			30.38			28.78			30.38
Book value per common share		29.82			30.31			28.46			29.82			28.46
Tangible book value per common share ⁽²⁾		17.12			17.58			15.61			17.12			15.61
Price to earnings ratio, diluted		10.65			9.28			10.37			11.86			10.99
Price to book value per common share ratio		0.97			0.86			1.07			0.97			1.07
Price to tangible book value per common share ratio ⁽²⁾		1.68			1.48			1.95			1.68			1.95
Weighted average common shares outstanding, basic		74,999,128			74,995,450			74,703,699			74,942,851			75,029,000
Weighted average common shares outstanding, diluted		74,999,128			74,995,557			74,705,054			74,943,999			75,034,084
Common shares outstanding at end of period		74,997,132			74,998,075			74,703,774			74,997,132			74,703,774

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)


	As of & For Three Months Ended									As of & For Nine Months Ended
	09/30/23			06/30/23			09/30/22			09/30/23			09/30/22
Capital Ratios
Common equity Tier 1 capital ratio ⁽⁵⁾		9.94	%		9.86	%		9.96	%		9.94	%		9.96	%
Tier 1 capital ratio ⁽⁵⁾		10.88	%		10.81	%		10.98	%		10.88	%		10.98	%
Total capital ratio ⁽⁵⁾		13.70	%		13.64	%		13.80	%		13.70	%		13.80	%
Leverage ratio (Tier 1 capital to average assets) ⁽⁵⁾		9.62	%		9.64	%		9.32	%		9.62	%		9.32	%
Common equity to total assets		10.72	%		10.96	%		10.60	%		10.72	%		10.60	%
Tangible common equity to tangible assets ⁽²⁾		6.45	%		6.66	%		6.11	%		6.45	%		6.11	%

Financial Condition
Assets	$	20,736,236		$	20,602,332		$	19,950,231		$	20,736,236		$	19,950,231
LHFI (net of deferred fees and costs)		15,283,620			15,066,930			13,918,720			15,283,620			13,918,720
Securities		3,032,982			3,143,235			3,640,722			3,032,982			3,640,722
Earning Assets		18,491,561			18,452,007			17,790,324			18,491,561			17,790,324
Goodwill		925,211			925,211			925,211			925,211			925,211
Amortizable intangibles, net		21,277			23,469			29,142			21,277			29,142
Deposits		16,786,505			16,411,987			16,546,216			16,786,505			16,546,216
Borrowings		1,020,669			1,320,301			669,558			1,020,669			669,558
Stockholders' equity		2,388,801			2,424,470			2,281,150			2,388,801			2,281,150
Tangible common equity ⁽²⁾		1,275,956			1,309,433			1,160,440			1,275,956			1,160,440

LHFI, net of deferred fees and costs
Construction and land development	$	1,132,940		$	1,231,720		$	1,068,201		$	1,132,940		$	1,068,201
Commercial real estate - owner occupied		1,975,281			1,952,189			1,953,872			1,975,281			1,953,872
Commercial real estate - non-owner occupied		4,148,218			4,113,318			3,900,325			4,148,218			3,900,325
Multifamily real estate		947,153			788,895			774,970			947,153			774,970
Commercial & Industrial		3,432,319			3,373,148			2,709,047			3,432,319			2,709,047
Residential 1-4 Family - Commercial		517,034			518,317			542,612			517,034			542,612
Residential 1-4 Family - Consumer		1,057,294			1,017,698			891,353			1,057,294			891,353
Residential 1-4 Family - Revolving		599,282			600,339			588,452			599,282			588,452
Auto		534,361			585,756			561,277			534,361			561,277
Consumer		126,151			134,709			172,776			126,151			172,776
Other Commercial		813,587			750,841			755,835			813,587			755,835
Total LHFI	$	15,283,620		$	15,066,930		$	13,918,720		$	15,283,620		$	13,918,720

Deposits
Interest checking accounts	$	5,055,464		$	4,824,192		$	4,354,351		$	5,055,464		$	4,354,351
Money market accounts		3,472,953			3,413,936			3,962,470			3,472,953			3,962,470
Savings accounts		950,363			986,081			1,173,566			950,363			1,173,566
Customer time deposits of $250,000 and over		634,950			578,739			391,332			634,950			391,332
Other customer time deposits		2,011,106			1,813,031			1,352,440			2,011,106			1,352,440
Time deposits		2,646,056			2,391,770			1,743,772			2,646,056			1,743,772
Total interest-bearing customer deposits		12,124,836			11,615,979			11,234,159			12,124,836			11,234,159
Brokered deposits		516,720			485,702			21,119			516,720			21,119
Total interest-bearing deposits	$	12,641,556		$	12,101,681		$	11,255,278		$	12,641,556		$	11,255,278
Demand deposits		4,144,949			4,310,306			5,290,938			4,144,949			5,290,938
Total deposits	$	16,786,505		$	16,411,987		$	16,546,216		$	16,786,505		$	16,546,216

Averages															��
Assets	$	20,596,189		$	20,209,687		$	19,980,500		$	20,397,518		$	19,873,644
LHFI (net of deferred fees and costs)		15,139,761			14,746,218			13,733,447			14,799,520			13,521,507
Loans held for sale		10,649			14,413			15,063			10,330			16,779
Securities		3,101,658			3,176,662			3,818,607			3,247,287			3,981,308
Earning assets		18,462,505			18,091,809			17,879,222			18,264,957			17,803,550
Deposits		16,795,611			16,280,154			16,488,224			16,499,045			16,397,790
Time deposits		2,914,004			2,500,966			1,745,224			2,571,114			1,726,341
Interest-bearing deposits		12,576,776			11,903,004			11,163,945			12,071,006			11,091,115
Borrowings		905,170			1,071,171			703,272			1,032,067			660,995
Interest-bearing liabilities		13,481,946			12,974,175			11,867,217			13,103,073			11,752,110
Stockholders' equity		2,446,902			2,460,741			2,436,999			2,443,833			2,513,522
Tangible common equity ⁽²⁾		1,332,993			1,345,426			1,315,085			1,328,385			1,378,240

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)


	As of & For Three Months Ended									As of & For Nine Months Ended
	09/30/23			06/30/23			09/30/22			09/30/23			09/30/22
Asset Quality
Allowance for Credit Losses (ACL)
Beginning balance, Allowance for loan and lease losses (ALLL)	$	120,683		$	116,512		$	104,184		$	110,768		$	99,787
Add: Recoveries		1,335			1,035			1,214			3,537			3,745
Less: Charge-offs		1,629			2,602			1,801			9,957			5,267
Add: Provision for loan losses		5,238			5,738			4,412			21,279			9,744
Ending balance, ALLL	$	125,627		$	120,683		$	108,009		$	125,627		$	108,009

Beginning balance, Reserve for unfunded commitment (RUC)	$	15,548		$	15,199		$	9,000		$	13,675		$	8,000
Add: Provision for unfunded commitments		(246)			349			2,000			1,627			3,000
Ending balance, RUC	$	15,302		$	15,548		$	11,000		$	15,302		$	11,000
Total ACL	$	140,929		$	136,231		$	119,009		$	140,929		$	119,009

ACL / total LHFI		0.92	%		0.90	%		0.86	%		0.92	%		0.86	%
ALLL / total LHFI		0.82	%		0.80	%		0.78	%		0.82	%		0.78	%
Net charge-offs / total average LHFI (annualized)		0.01	%		0.04	%		0.02	%		0.06	%		0.02	%
Provision for loan losses/ total average LHFI (annualized)		0.14	%		0.16	%		0.13	%		0.19	%		0.10	%

Nonperforming Assets
Construction and land development	$	355		$	284		$	421		$	355		$	421
Commercial real estate - owner occupied		3,882			3,978			4,883			3,882			4,883
Commercial real estate - non-owner occupied		5,999			6,473			1,923			5,999			1,923
Commercial & Industrial		2,256			2,738			2,289			2,256			2,289
Residential 1-4 Family - Commercial		1,833			1,844			1,962			1,833			1,962
Residential 1-4 Family - Consumer		10,368			10,033			11,121			10,368			11,121
Residential 1-4 Family - Revolving		3,572			3,461			3,583			3,572			3,583
Auto		361			291			318			361			318
Consumer		—			3			—			—			—
Nonaccrual loans	$	28,626		$	29,105		$	26,500		$	28,626		$	26,500
Foreclosed property		149			50			2,087			149			2,087
Total nonperforming assets (NPAs)	$	28,775		$	29,155		$	28,587		$	28,775		$	28,587
Construction and land development	$	25		$	24		$	115		$	25		$	115
Commercial real estate - owner occupied		2,395			2,463			3,517			2,395			3,517
Commercial real estate - non-owner occupied		2,835			2,763			621			2,835			621
Commercial & Industrial		792			810			526			792			526
Residential 1-4 Family - Commercial		817			693			308			817			308
Residential 1-4 Family - Consumer		3,632			1,716			680			3,632			680
Residential 1-4 Family - Revolving		1,034			1,259			1,255			1,034			1,255
Auto		229			243			148			229			148
Consumer		97			74			86			97			86
Other Commercial		15			66			95			15			95
LHFI ≥ 90 days and still accruing	$	11,871		$	10,111		$	7,351		$	11,871		$	7,351
Total NPAs and LHFI ≥ 90 days	$	40,646		$	39,266		$	35,938		$	40,646		$	35,938
NPAs / total LHFI		0.19	%		0.19	%		0.21	%		0.19	%		0.21	%
NPAs / total assets		0.14	%		0.14	%		0.14	%		0.14	%		0.14	%
ALLL / nonaccrual loans		438.86	%		414.65	%		407.58	%		438.86	%		407.58	%
ALLL/ nonperforming assets		436.58	%		413.94	%		377.83	%		436.58	%		377.83	%

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)


	As of & For Three Months Ended									As of & For Nine Months Ended
	09/30/23			06/30/23			09/30/22			09/30/23			09/30/22
Past Due Detail
Construction and land development	$	—		$	295		$	120		$	—		$	120
Commercial real estate - owner occupied		3,501			602			7,337			3,501			7,337
Commercial real estate - non-owner occupied		4,573			—			—			4,573			—
Commercial & Industrial		3,049			254			796			3,049			796
Residential 1-4 Family - Commercial		744			1,076			1,410			744			1,410
Residential 1-4 Family - Consumer		1,000			1,504			1,123			1,000			1,123
Residential 1-4 Family - Revolving		2,326			1,729			1,115			2,326			1,115
Auto		2,703			2,877			1,876			2,703			1,876
Consumer		517			334			409			517			409
Other Commercial		3,545			23			—			3,545			—
LHFI 30-59 days past due	$	21,958		$	8,694		$	14,186		$	21,958		$	14,186
Construction and land development	$	386		$	—		$	107		$	386		$	107
Commercial real estate - owner occupied		1,902			10			763			1,902			763
Commercial real estate - non-owner occupied		797			—			457			797			457
Multifamily real estate		150			—			—			150			—
Commercial & Industrial		576			400			3,128			576			3,128
Residential 1-4 Family - Commercial		67			189			97			67			97
Residential 1-4 Family - Consumer		1,775			2,813			1,449			1,775			1,449
Residential 1-4 Family - Revolving		602			1,114			1,081			602			1,081
Auto		339			564			257			339			257
Consumer		164			214			101			164			101
LHFI 60-89 days past due	$	6,758		$	5,304		$	7,440		$	6,758		$	7,440

Past Due and still accruing	$	40,587		$	24,109		$	28,977		$	40,587		$	28,977
Past Due and still accruing / total LHFI		0.27	%		0.16	%		0.21	%		0.27	%		0.21	%

Alternative Performance Measures (non-GAAP)
Net interest income (FTE) ⁽¹⁾
Net interest income (GAAP)	$	151,941		$	152,084		$	150,715		$	457,469		$	420,413
FTE adjustment		3,744			3,666			3,842			11,198			10,755
Net interest income (FTE) (non-GAAP)	$	155,685		$	155,750		$	154,557		$	468,667		$	431,168
Noninterest income (GAAP)		27,094			24,197			25,584			60,918			94,023
Total revenue (FTE) (non-GAAP)	$	182,779		$	179,947		$	180,141		$	529,585		$	525,191

Average earning assets	$	18,462,505		$	18,091,809		$	17,879,222		$	18,264,957		$	17,803,550
Net interest margin		3.27	%		3.37	%		3.34	%		3.35	%		3.16	%
Net interest margin (FTE)		3.35	%		3.45	%		3.43	%		3.43	%		3.24	%

Tangible Assets ⁽²⁾
Ending assets (GAAP)	$	20,736,236		$	20,602,332		$	19,950,231		$	20,736,236		$	19,950,231
Less: Ending goodwill		925,211			925,211			925,211			925,211			925,211
Less: Ending amortizable intangibles		21,277			23,469			29,142			21,277			29,142
Ending tangible assets (non-GAAP)	$	19,789,748		$	19,653,652		$	18,995,878		$	19,789,748		$	18,995,878

Tangible Common Equity ⁽²⁾
Ending equity (GAAP)	$	2,388,801		$	2,424,470		$	2,281,150		$	2,388,801		$	2,281,150
Less: Ending goodwill		925,211			925,211			925,211			925,211			925,211
Less: Ending amortizable intangibles		21,277			23,469			29,142			21,277			29,142
Less: Perpetual preferred stock		166,357			166,357			166,357			166,357			166,357
Ending tangible common equity (non-GAAP)	$	1,275,956		$	1,309,433		$	1,160,440		$	1,275,956		$	1,160,440

Average equity (GAAP)	$	2,446,902		$	2,460,741		$	2,436,999		$	2,443,833		$	2,513,522
Less: Average goodwill		925,211			925,211			925,211			925,211			932,035
Less: Average amortizable intangibles		22,342			23,748			30,347			23,881			36,891
Less: Average perpetual preferred stock		166,356			166,356			166,356			166,356			166,356
Average tangible common equity (non-GAAP)	$	1,332,993		$	1,345,426		$	1,315,085		$	1,328,385		$	1,378,240

ROTCE ⁽²⁾⁽³⁾
Net income available to common shareholders (GAAP)	$	51,050		$	52,274		$	55,103		$	136,010		$	155,085
Plus: Amortization of intangibles, tax effected		1,732			1,751			1,959			5,283			6,663
Net income available to common shareholders before amortization of intangibles (non-GAAP)	$	52,782		$	54,025		$	57,062		$	141,293		$	161,748

Return on average tangible common equity (ROTCE)		15.71	%		16.11	%		17.21	%		14.22	%		15.69	%

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)


	As of & For Three Months Ended									As of & For Nine Months Ended
	09/30/23			06/30/23			09/30/22			09/30/23				09/30/22
Operating Measures⁽⁴⁾
Net income (GAAP)	$	54,017		$	55,241		$	58,070		$	144,911		$	163,986
Plus: Strategic cost saving initiatives, net of tax		6,851			3,109			—			9,959			—
Plus: Merger-related costs, net of tax		1,965			—			—			1,965			—
Plus: Legal reserve, net of tax		—			—			—			3,950			—
Plus: Strategic branch closing and facility consolidation costs, net of tax		—			—			—			—			4,351
Less: (Loss) gain on sale of securities, net of tax		(21,799)			2			—			(32,384)			(2)
Less: Gain on sale-leaseback transaction, net of tax		21,883			—			—			21,883			—
Less: Gain on sale of DHFB, net of tax		—			—			—			—			7,984
Adjusted operating earnings (non-GAAP)		62,749			58,348			58,070			171,286			160,355
Less: Dividends on preferred stock		2,967			2,967			2,967			8,901			8,901
Adjusted operating earnings available to common shareholders (non-GAAP)	$	59,782		$	55,381		$	55,103		$	162,385		$	151,454

Operating Efficiency Ratio⁽¹⁾⁽⁶⁾
Noninterest expense (GAAP)	$	108,508		$	105,661		$	99,923		$	322,442		$	304,012
Less: Amortization of intangible assets		2,193			2,216			2,480			6,687			8,434
Less: Strategic cost saving initiatives		8,672			3,935			—			12,607			—
Less: Merger-related costs		1,993			—			—			1,993			—
Less: Legal reserve		—			—			—			5,000			—
Less: Strategic branch closing and facility consolidation costs		—			—			—			—			5,508
Adjusted operating noninterest expense (non-GAAP)	$	95,650		$	99,510		$	97,443		$	296,155		$	290,070

Noninterest income (GAAP)	$	27,094		$	24,197		$	25,584		$	60,918		$	94,023
Less: (Loss) gain on sale of securities		(27,594)			2			—			(40,992)			(2)
Less: Gain on sale-leaseback transaction		27,700			—			—			27,700			—
Less: Gain on sale of DHFB		—			—			—			—			9,082
Adjusted operating noninterest income (non-GAAP)	$	26,988		$	24,195		$	25,584		$	74,210		$	84,943

Net interest income (FTE) (non-GAAP)⁽¹⁾	$	155,685		$	155,750		$	154,557		$	468,667		$	431,168
Adjusted operating noninterest income (non-GAAP)		26,988			24,195			25,584			74,210			84,943
Total adjusted revenue (FTE) (non-GAAP) ⁽¹⁾	$	182,673		$	179,945		$	180,141		$	542,877		$	516,111

Efficiency ratio		60.61	%		59.94	%		56.68	%		62.20	%		59.10	%
Efficiency ratio (FTE) ⁽¹⁾		59.37	%		58.72	%		55.47	%		60.89	%		57.89	%
Adjusted operating efficiency ratio (FTE) ⁽¹⁾⁽⁶⁾		52.36	%		55.30	%		54.09	%		54.55	%		56.20	%

Operating ROA & ROE ⁽⁴⁾
Adjusted operating earnings (non-GAAP)	$	62,749		$	58,348		$	58,070		$	171,286		$	160,355

Average assets (GAAP)	$	20,596,189		$	20,209,687		$	19,980,500		$	20,397,518		$	19,873,644
Return on average assets (ROA) (GAAP)		1.04	%		1.10	%		1.15	%		0.95	%		1.10	%
Adjusted operating return on average assets (ROA) (non-GAAP)		1.21	%		1.16	%		1.15	%		1.12	%		1.08	%

Average equity (GAAP)	$	2,446,902		$	2,460,741		$	2,436,999		$	2,443,833		$	2,513,522
Return on average equity (ROE) (GAAP)		8.76	%		9.00	%		9.45	%		7.93	%		8.72	%
Adjusted operating return on average equity (ROE) (non-GAAP)		10.17	%		9.51	%		9.45	%		9.37	%		8.53	%

Operating ROTCE ^(2)(3)(4)
Adjusted operating earnings available to common shareholders (non-GAAP)	$	59,782		$	55,381		$	55,103		$	162,385		$	151,454
Plus: Amortization of intangibles, tax effected		1,732			1,751			1,959			5,283			6,663
Adjusted operating earnings available to common shareholders before amortization of intangibles (non-GAAP)	$	61,514		$	57,132		$	57,062		$	167,668		$	158,117

Average tangible common equity (non-GAAP)	$	1,332,993		$	1,345,426		$	1,315,085		$	1,328,385		$	1,378,240
Adjusted operating return on average tangible common equity (non-GAAP)		18.31	%		17.03	%		17.21	%		16.88	%		15.34	%

Pre-tax pre-provision adjusted operating earnings ⁽⁷⁾
Net income (GAAP)	$	54,017		$	55,241		$	58,070		$	144,911		$	163,986
Plus: Provision for credit losses		4,991			6,069			6,412			22,911			12,771
Plus: Income tax expense		11,519			9,310			11,894			28,123			33,667
Plus: Strategic cost saving initiatives		8,672			3,935			—			12,607			—
Plus: Merger-related costs		1,993			—			—			1,993			—
Plus: Legal reserve		—			—			—			5,000			—
Plus: Strategic branch closing and facility consolidation costs		—			—			—			—			5,508
Less: (Loss) gain on sale of securities		(27,594)			2			—			(40,992)			(2)
Less: Gain on sale-leaseback transaction		27,700			—			—			27,700			—
Less: Gain on sale of DHFB		—			—			—			—			9,082
Pre-tax pre-provision adjusted operating earnings (non-GAAP)	$	81,086		$	74,553		$	76,376		$	228,837		$	206,852
Less: Dividends on preferred stock		2,967			2,967			2,967			8,901			8,901
Pre-tax pre-provision adjusted operating earnings available to common shareholders (non-GAAP)	$	78,119		$	71,586		$	73,409		$	219,936		$	197,951

Weighted average common shares outstanding, diluted		74,999,128			74,995,557			74,705,054			74,943,999			75,034,084
Pre-tax pre-provision earnings per common share, diluted	$	1.04		$	0.95		$	0.98		$	2.93		$	2.64

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS (UNAUDITED)

(Dollars in thousands, except share data)


	As of & For Three Months Ended									As of & For Nine Months Ended
	09/30/23			06/30/23			09/30/22			09/30/23			09/30/22
Mortgage Origination Held for Sale Volume
Refinance Volume	$	2,239		$	4,076		$	5,637		$	9,767		$	53,753
Purchase Volume		35,815			32,168			66,360			100,175			209,206
Total Mortgage loan originations held for sale	$	38,054		$	36,244		$	71,997		$	109,942		$	262,959
% of originations held for sale that are refinances		5.9	%		11.2	%		7.8	%		8.9	%		20.4	%

Wealth
Assets under management	$	4,675,523		$	4,774,501		$	4,065,059		$	4,675,523		$	4,065,059

Other Data
End of period full-time employees		1,788			1,878			1,890			1,788			1,890
Number of full-service branches		109			109			114			109			114
Number of automatic transaction machines ("ATMs")		123			123			131			123			131

(1)

These are non-GAAP financial measures. The Company believes net interest income (FTE), total revenue (FTE), and total adjusted revenue (FTE), which are used in computing net interest margin (FTE), efficiency ratio (FTE) and adjusted operating efficiency ratio (FTE), provide valuable additional insight into the net interest margin and the efficiency ratio by adjusting for differences in tax treatment of interest income sources. The entire FTE adjustment is attributable to interest income on earning assets, which is used in computing yield on earning assets. Interest expense and the related cost of interest-bearing liabilities and cost of funds ratios are not affected by the FTE components.

(2)

These are non-GAAP financial measures. Tangible assets and tangible common equity are used in the calculation of certain profitability, capital, and per share ratios. The Company believes tangible assets, tangible common equity and the related ratios are meaningful measures of capital adequacy because they provide a meaningful base for period-to-period and company-to-company comparisons, which the Company believes will assist investors in assessing the capital of the Company and its ability to absorb potential losses. The Company believes tangible common equity is an important indication of its ability to grow organically and through business combinations as well as its ability to pay dividends and to engage in various capital management strategies.

(3)

These are non-GAAP financial measures. The Company believes that ROTCE is a meaningful supplement to GAAP financial measures and is useful to investors because it measures the performance of a business consistently across time without regard to whether components of the business were acquired or developed internally.

(4)

These are non-GAAP financial measures. Adjusted operating measures exclude, as applicable, strategic cost saving initiatives (principally composed of severance charges related to headcount reductions, costs related to modifying certain third party vendor contracts, and charges for exiting certain leases), merger-related costs, a legal reserve associated with an ongoing regulatory matter previously disclosed, strategic branch closing and related facility consolidation costs (principally composed of real estate, leases and other assets write downs, as well as severance and expense reduction initiatives), (loss) gain on sale of securities, gain on sale-leaseback transaction, and gain on sale of DHFB. The Company believes these non-GAAP adjusted measures provide investors with important information about the continuing economic results of the organization’s operations.

(5)	All ratios at September 30, 2023 are estimates and subject to change pending the Company’s filing of its FR Y9-C. All other periods are presented as filed.

(6)

The adjusted operating efficiency ratio (FTE) excludes, as applicable, the amortization of intangible assets, strategic cost saving initiatives, merger-related costs, a legal reserve associated with an ongoing regulatory matter previously disclosed, strategic branch closing and related facility consolidation costs, (loss) gain on sale of securities, gain on sale-leaseback transaction, and gain on sale of DHFB. This measure is similar to the measure utilized by the Company when analyzing corporate performance and is also similar to the measure utilized for incentive compensation. The Company believes this adjusted measure provides investors with important information about the continuing economic results of the organization’s operations.

(7)

These are non-GAAP financial measures. Pre-tax pre-provision adjusted earnings excludes, as applicable, the provision for credit losses, which can fluctuate significantly from period-to-period under the CECL methodology, income tax expense, strategic cost saving initiatives, merger-related costs, a legal reserve associated with an ongoing regulatory matter previously disclosed, strategic branch closure initiatives and related facility consolidation costs, (loss) gain on sale of securities, gain on sale-leaseback transaction, and gain on sale of DHFB. The Company believes this adjusted measure provides investors with important information about the continuing economic results of the Company’s operations.

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except share data)


	September 30,		December 31,		September 30,
	2023		2022		2022
ASSETS		(unaudited)		(audited)		(unaudited)
Cash and cash equivalents:
Cash and due from banks	$	233,526	$	216,384	$	177,969
Interest-bearing deposits in other banks		159,718		102,107		211,785
Federal funds sold		5,701		1,457		1,188
Total cash and cash equivalents		398,945		319,948		390,942
Securities available for sale, at fair value		2,084,928		2,741,816		2,717,323
Securities held to maturity, at carrying value		843,269		847,732		841,349
Restricted stock, at cost		104,785		120,213		82,050
Loans held for sale		6,608		3,936		12,889
Loans held for investment, net of deferred fees and costs		15,283,620		14,449,142		13,918,720
Less: allowance for loan and lease losses		125,627		110,768		108,009
Total loans held for investment, net		15,157,993		14,338,374		13,810,711
Premises and equipment, net		94,510		118,243		126,374
Goodwill		925,211		925,211		925,211
Amortizable intangibles, net		21,277		26,761		29,142
Bank owned life insurance		449,452		440,656		437,988
Other assets		649,258		578,248		576,252
Total assets	$	20,736,236	$	20,461,138	$	19,950,231
LIABILITIES
Noninterest-bearing demand deposits	$	4,144,949	$	4,883,239	$	5,290,938
Interest-bearing deposits		12,641,556		11,048,438		11,255,278
Total deposits		16,786,505		15,931,677		16,546,216
Securities sold under agreements to repurchase		134,936		142,837		146,182
Other short-term borrowings		495,000		1,176,000		133,800
Long-term borrowings		390,733		389,863		389,576
Other liabilities		540,261		448,024		453,307
Total liabilities		18,347,435		18,088,401		17,669,081
Commitments and contingencies
STOCKHOLDERS' EQUITY
Preferred stock, $10.00 par value		173		173		173
Common stock, $1.33 par value		99,120		98,873		98,845
Additional paid-in capital		1,779,281		1,772,440		1,769,858
Retained earnings		988,133		919,537		874,393
Accumulated other comprehensive loss		(477,906)		(418,286)		(462,119)
Total stockholders' equity		2,388,801		2,372,737		2,281,150
Total liabilities and stockholders' equity	$	20,736,236	$	20,461,138	$	19,950,231

Common shares outstanding		74,997,132		74,712,622		74,703,774
Common shares authorized		200,000,000		200,000,000		200,000,000
Preferred shares outstanding		17,250		17,250		17,250
Preferred shares authorized		500,000		500,000		500,000

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(Dollars in thousands, except share data)


	Three Months Ended						Nine Months Ended
	September 30,		June 30,		September 30,		September 30,		September 30,
	2023		2023		2022		2023		2022
Interest and dividend income:
Interest and fees on loans	$	221,380	$	205,172	$	144,673	$	616,544	$	382,139
Interest on deposits in other banks		1,309		1,014		941		3,815		1,229
Interest and dividends on securities:
Taxable		16,055		15,565		14,750		48,373		43,110
Nontaxable		8,415		8,496		10,792		26,220		31,889
Total interest and dividend income		247,159		230,247		171,156		694,952		458,367
Interest expense:
Interest on deposits		83,590		65,267		15,386		200,690		25,966
Interest on short-term borrowings		6,499		8,044		1,229		22,106		1,805
Interest on long-term borrowings		5,129		4,852		3,826		14,687		10,183
Total interest expense		95,218		78,163		20,441		237,483		37,954
Net interest income		151,941		152,084		150,715		457,469		420,413
Provision for credit losses		4,991		6,069		6,412		22,911		12,771
Net interest income after provision for credit losses		146,950		146,015		144,303		434,558		407,642
Noninterest income:
Service charges on deposit accounts		8,557		8,118		6,784		24,577		22,421
Other service charges, commissions and fees		2,632		1,693		1,770		6,071		5,134
Interchange fees		2,314		2,459		2,461		7,098		6,539
Fiduciary and asset management fees		4,549		4,359		4,134		13,169		18,329
Mortgage banking income		666		449		1,390		1,969		6,707
(Loss) gain on sale of securities		(27,594)		2		—		(40,992)		(2)
Bank owned life insurance income		2,973		2,870		3,445		8,671		8,858
Loan-related interest rate swap fees		2,695		2,316		2,050		6,450		8,510
Other operating income		30,302		1,931		3,550		33,905		17,527
Total noninterest income		27,094		24,197		25,584		60,918		94,023
Noninterest expenses:
Salaries and benefits		57,449		62,019		56,600		179,996		170,203
Occupancy expenses		6,053		6,094		6,408		18,503		19,685
Furniture and equipment expenses		3,449		3,565		3,673		10,765		10,860
Technology and data processing		7,923		8,566		8,273		24,631		23,930
Professional services		3,291		4,433		3,504		11,138		12,274
Marketing and advertising expense		2,219		2,817		2,343		7,387		7,008
FDIC assessment premiums and other insurance		4,258		4,074		3,094		12,231		8,344
Franchise and other taxes		4,510		4,499		4,507		13,508		13,506
Loan-related expenses		1,388		1,619		1,575		4,560		5,218
Amortization of intangible assets		2,193		2,216		2,480		6,687		8,434
Other expenses		15,775		5,759		7,466		33,036		24,550
Total noninterest expenses		108,508		105,661		99,923		322,442		304,012
Income before income taxes		65,536		64,551		69,964		173,034		197,653
Income tax expense		11,519		9,310		11,894		28,123		33,667
Net income	$	54,017	$	55,241	$	58,070		144,911		163,986
Dividends on preferred stock		2,967		2,967		2,967		8,901		8,901
Net income available to common shareholders	$	51,050	$	52,274	$	55,103	$	136,010	$	155,085

Basic earnings per common share	$	0.68	$	0.70	$	0.74	$	1.81	$	2.07
Diluted earnings per common share	$	0.68	$	0.70	$	0.74	$	1.81	$	2.07

AVERAGE BALANCES, INCOME AND EXPENSES, YIELDS AND RATES (TAXABLE EQUIVALENT BASIS) (UNAUDITED)

(Dollars in thousands)


	For the Quarter Ended
	September 30, 2023					June 30, 2023
	Average Balance		Interest Income / Expense ⁽¹⁾		Yield / Rate ⁽¹⁾⁽²⁾	Average Balance		Interest Income / Expense ⁽¹⁾		Yield / Rate ⁽¹⁾⁽²⁾
Assets:
Securities:
Taxable	$	1,799,675	$	16,055	3.54%	$	1,865,193	$	15,565	3.35%
Tax-exempt		1,301,983		10,653	3.25%		1,311,469		10,755	3.29%
Total securities		3,101,658		26,708	3.42%		3,176,662		26,320	3.32%
LHFI, net of deferred fees and costs ⁽³⁾		15,139,761		222,698	5.84%		14,746,218		206,452	5.62%
Other earning assets		221,086		1,497	2.69%		168,929		1,141	2.71%
Total earning assets		18,462,505	$	250,903	5.39%		18,091,809	$	233,913	5.19%
Allowance for loan and lease losses		(121,229)					(117,643)
Total non-earning assets		2,254,913					2,235,521
Total assets	$	20,596,189				$	20,209,687

Liabilities and Stockholders' Equity:
Interest-bearing deposits:
Transaction and money market accounts	$	8,697,801	$	57,378	2.62%	$	8,387,473	$	46,953	2.25%
Regular savings		964,971		499	0.21%		1,014,565		430	0.17%
Time deposits		2,914,004		25,713	3.50%		2,500,966		17,884	2.87%
Total interest-bearing deposits		12,576,776		83,590	2.64%		11,903,004		65,267	2.20%
Other borrowings		905,170		11,628	5.10%		1,071,171		12,896	4.83%
Total interest-bearing liabilities	$	13,481,946	$	95,218	2.80%	$	12,974,175	$	78,163	2.42%

Noninterest-bearing liabilities:
Demand deposits		4,218,835					4,377,150
Other liabilities		448,506					397,621
Total liabilities		18,149,287					17,748,946
Stockholders' equity		2,446,902					2,460,741
Total liabilities and stockholders' equity	$	20,596,189				$	20,209,687
Net interest income			$	155,685				$	155,750

Interest rate spread					2.59%					2.77%
Cost of funds					2.04%					1.74%
Net interest margin					3.35%					3.45%

(1)	Income and yields are reported on a taxable equivalent basis using the statutory federal corporate tax rate of 21%.

(2)	Rates and yields are annualized and calculated from actual, not rounded amounts in thousands, which appear above.

(3)	Nonaccrual loans are included in average loans outstanding.

Atlantic Union Bankshares (AUB) 8-KAtlantic Union Bankshares Reports Third Quarter Financial Results