EXHIBIT 99.1
News Release
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[LOGO OF UNITED BANKSHARES, INC.]
For Immediate Release Contact: Steven E. Wilson (304) 424-8704
July 18, 2001 Chief Financial Officer
United Bankshares, Inc. Announces Record Earnings for
Second Quarter and First Half of 2001
United Bankshares, Inc., today reported record earnings for the second
quarter and the first half of 2001. Diluted earnings per share improved by 9%
for the second quarter and first half of 2001 to 47cents and 93cents as compared
to 43cents and 85cents for the same periods of 2000, respectively. Quarterly net
income was $19.8 million compared with $18.1 million a year earlier. Net income
for the first six months of 2001 was $39.1 million compared to $36.1 million for
the prior year's first six months. Cash earnings per share were 49cents and
96cents for the second quarter and first half of 2001, respectively.
United's key performance ratios were strong for the three months and six
months ended June 30, 2001, United's return on average assets was 1.60% and
1.61%, respectively while the return on average equity was 17.54% and 17.70%,
respectively. On a cash basis, return on average tangible assets was 1.66% and
1.67% for the second quarter and first half of 2001, respectively while return
on average tangible equity was 19.67% and 19.91%, respectively for the same
periods of time. These key financial performance ratios are indicative of
United's earnings strength and balanced capital levels. United continues to be
one of the best performing regional banking companies in the nation.
Tax-equivalent net interest income for the second quarter was $49.1 million
with a net interest margin of 4.18%; an increase of 8 basis points from the
preceding quarter due to the cost of United's short-term borrowed funds
declining 92 basis points for the quarter. The level of earning assets
increased approximately 3% from the end of the first quarter of 2001.
Noninterest income, excluding security transactions, for the second quarter
of 2001 increased 30.6% from the second quarter of 2000 and 13.1% over the first
quarter of 2001. These increased revenues were the result of an expanded volume
of trust and mortgage banking services for the quarter. Income from mortgage
banking and trust operations increased 55.5% and 25.2%, respectively for the
second quarter of 2001 as compared to the second quarter of 2000. On a linked-
quarter basis, mortgage banking income increased by 23.8% while trust fees grew
8.9%.
Noninterest expense for the quarter increased 8.7% compared to the second
quarter of 2000 and was up 9.1% over the first quarter of 2001 due mainly to
higher sales activity in the mortgage banking segment as compensation and
incentives for its personnel are significantly tied to activity levels. The
efficiency ratio was still a low 43.97% and 43.42% for the second quarter and
first half of 2001, respectively. This ratio compares very favorably to regional
and national peer group banking companies.
United Bankshares, Inc. Announces...
July 18, 2001
Page Two
United's asset quality remains sound with the nonperforming asset level at
0.27% of total assets improving from 0.29% and 0.30% at the end of the first
quarter 2001 and year end 2000, respectively. Nonperforming loans were $11.2
million at June 30, 2001 as compared to $12.3 million at March 31, 2001 and
$12.8 million at December 31, 2000. Net charge-offs were $2.1 million for the
second quarter of 2001 as compared to net charge-offs of $4.0 million for the
previous year quarter. Net charge-offs for the first half of 2001 were $4.0
million as compared to $6.7 million for the first half of 2000. As of June 30,
2001, the allowance for loan losses was $41.2 million or 1.29% of loans, net of
unearned income.
Total assets have grown $190.1 million or 4% since year end 2000.
Shareholders' equity has increased $14.1 million or 3% since year end resulting
in a book value per share of $10.77. United is categorized as well capitalized
based on the risk-based capital ratio, considerably exceeding the regulatory
minimum requirement. These measures provide evidence that United's financial
position is strong.
During the quarter, United's Board of Directors declared a cash dividend of
23(cents) per share, a 10% increase over the 21(cents) per share paid in the
second quarter of 2000. The annualized first half dividend of 45(cents) per
share equals 90(cents) which would represent the twenty-eighth consecutive year
of dividend increases for United shareholders.
United recently signed a definitive merger agreement with Century
Bancshares, Inc. of Washington, D.C., with assets of approximately $415 million.
The transaction, which is expected to close during the fourth quarter of 2001,
will increase United's Virginia franchise to more than $2 billion in assets and
will rank United as the ninth largest bank in the Virginia and Washington, D.C.
MSA. Following completion of the proposed merger with Century, United will have
consolidated assets over $5.4 billion with 86 full service offices in West
Virginia, Virginia, Maryland, Ohio and Washington, D.C. Consummation of the
transaction is subject to approval of the shareholders of United and Century and
the receipt of all regulatory approvals, as well as other customary conditions.
United Bankshares, with $5 billion in assets, presently has 75 full-service
offices in West Virginia, Virginia, Maryland, Ohio, and Washington, D.C. United
Bankshares stock is traded on the NASDAQ (National Association of Securities
Dealers Quotation System) National Market System under the quotation symbol
"UBSI".
This press release contains certain forward-looking statements, including
certain plans, expectations, goals and projections, which are subject to
numerous assumptions, risks and uncertainties. Actual results could differ
materially from those contained in or implied by such statements for a variety
of factors including: changes in economic conditions; movements in interest
rates; competitive pressures on product pricing and services; success and timing
of business strategies; the nature and extent of governmental actions and
reforms; and rapidly changing technology evolving banking industry standards.
[LOGO OF UNITED BANKSHARES, INC.]
UNITED BANKSHARES, INC. AND SUBSIDIARIES
FINANCIAL SUMMARY
(In Thousands Except for Per Share Data)
Three Months Ended Six Months Ended
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June 30 June 30 June 30 June 30
2001 2000 2001 2000
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EARNINGS SUMMARY:
Interest income, taxable equivalent $ 94,593 $ 96,577 $ 189,458 $ 192,721
Interest expense 45,467 48,632 93,244 95,174
Net interest income, taxable equivalent 49,126 47,945 96,214 97,547
Taxable equivalent adjustment 2,897 2,514 5,765 5,390
Net interest income 46,229 45,431 90,449 92,157
Provision for loan losses 2,143 3,851 4,642 6,398
Income (loss) from mortgage banking operations 6,469 4,159 11,694 7,542
Gain (loss) on security transactions (718) 505 (576) 823
Other noninterest income 9,145 7,800 17,723 14,900
Noninterest expenses 29,453 27,106 56,449 55,249
Income taxes 9,745 8,815 19,063 17,664
Net income 19,784 18,123 39,136 36,111
Cash dividends paid 9,530 8,812 18,705 17,691
PER COMMON SHARE:
Net income:
Basic 0.48 0.43 0.94 0.86
Diluted 0.47 0.43 0.93 0.85
Diluted - cash basis 0.49 0.44 0.96 0.88
Cash dividends paid 0.23 0.21 0.45 0.42
Book value 10.77 9.60
Closing market price 26.800 18.188
Common shares outstanding:
Actual, net of treasury shares 41,308,168 41,910,723
Average basic 41,466,564 41,931,050 41,584,502 42,110,730
Average diluted 41,823,411 42,264,141 41,914,814 42,449,089
FINANCIAL RATIOS:
Return on average assets 1.60% 1.47% 1.61% 1.46%
Return on average shareholders' equity 17.54% 18.19% 17.70% 18.12%
Average equity to average assets 9.12% 8.11% 9.09% 8.08%
Net interest margin 4.18% 4.13% 4.14% 4.18%
June 30 June 30 December 31 March 31
2001 2000 2000 2001
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PERIOD END BALANCES:
Assets 5,094,607 4,991,051 4,904,547 4,984,804
Earning assets 4,858,310 4,740,443 4,643,668 4,762,807
Loans, net of unearned income 3,204,163 3,221,646 3,192,494 3,171,846
Loans held for sale 198,591 153,701 203,831 239,148
Investment securities 1,450,917 1,353,317 1,245,334 1,303,613
Total deposits 3,450,939 3,270,925 3,391,449 3,462,701
Shareholders' equity 444,967 402,135 430,870 445,084