EXHIBIT 99.1
News Release
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[LOGO] UNITED
BANKSHARES, INC.
For Immediate Release Contact: Steven E. Wilson
January 22, 2002 Chief Financial Officer
(304) 424-8704
United Bankshares, Inc. Announces Record Earnings
For the Year 2001
United Bankshares, Inc. (NASDAQ: UBSI), today reported record earnings for
the year 2001. Fourth quarter earnings were $21.1 million or 49c per share while
earnings for the year 2001 were $80.0 million or $1.90 per share. Fourth quarter
2001 earnings per share of 49c increased 14% over operating earnings per share
of 43c for the fourth quarter of 2000. Earnings per share for the year 2001
increased 10% from operating earnings per share of $1.72 for the year 2000. On
an as reported basis, United earned $4.3 million or 11c per share and $59.0
million or $1.40 per share for the fourth quarter and year of 2000,
respectively. United's fourth quarter 2000 earnings included significant
restructuring and other one-time charges. Excluding these charges, United's
operating earnings were $17.8 million or 43c per share and $72.5 million or
$1.72 per share for the fourth quarter and year of 2000, respectively.
"2001 was the best earnings year in our company's history," said Richard M.
Adams, Chairman and CEO, "accomplished in a year in which our country was
suffering through an economic recession and the tragic events of September 11."
The 2001 results represented a return on average assets of 1.59% and a
return on shareholders' equity of 17.51%. These key financial performance
indicators are reflective of United's earnings strength as United continues to
be one of the best performing regional banking companies in the nation.
Tax-equivalent net interest income for the fourth quarter of 2001 was $51.0
million, an increase of $4.4 million and $1.5 million from the fourth quarter of
2000 and third quarter of 2001, respectively. The net interest margin for the
fourth quarter of 2001 was 4.07%, which represented a 4 basis points increase
over the fourth quarter of 2000's net interest margin of 4.03%. United's tax-
equivalent net interest margin for the year of 2001 was 4.12% compared to 4.11%
for the year of 2000.
Although weakening economic conditions caused an increase in nonperforming
loans during the fourth quarter and the year of 2001, United's credit quality
continues to compare favorably with peer and industry averages. Nonperforming
loans were $17.6 million or 0.50% of loans, net of unearned income at December
31, 2001 compared to $12.8 million or 0.40% of loans, net of unearned income at
December 31, 2000. Net charge-offs also increased during the fourth quarter of
2001, but for the year of 2001 remained below the prior year level. Net charge-
offs were $3.9 million for the fourth quarter of 2001, compared to $3.8 million
for the fourth quarter of 2000. Net charge-offs were $10.6 million for the year
of 2001, down $4.2 million from net charge-offs of $14.8 million for the year of
2000. For the quarters ended December 31, 2001 and 2000, the provision for loan
losses was $4.0 million and $4.9 million, respectively, while the provision for
the year was $12.8 million for 2001 as compared to $15.7 million for 2000. As of
December 31, 2001, the allowance for loan losses was $47.4 million or 1.35% of
loans, net of unearned income, compared to 1.29% at December 31, 2000.
United Bankshares, Inc. Announces...
January 22, 2002
Page Two
Noninterest income, excluding security transactions, for the fourth quarter
of 2001 rose 38.5% from the fourth quarter of 2000 and 3.0% over the third
quarter of 2001. Income from mortgage banking operations and deposit services
increased 97.7% and 19.7%, respectively for the fourth quarter of 2001 as
compared to the fourth quarter of 2000. On a linked-quarter basis, deposit
services income increased by 6.4%. Noninterest income, excluding security
transactions, for the year of 2001 was up 31.6% from the year of 2000 due mainly
to a 62.3% increase in mortgage banking income.
Noninterest expense, on an operating basis, increased 18.2% for the quarter
compared to the prior year's fourth quarter and was up 8.8% for the year due
mainly to higher sales activity in the mortgage banking segment as compensation
and incentives for its personnel are significantly tied to activity levels. On a
linked-quarter basis, noninterest expense increased 5.3% due mainly to expenses
related to the Century Bancshares merger and planning initiatives. The
efficiency ratio was still a low 43.21% and 43.09% for the fourth quarter and
year of 2001, respectively compared to 48.95% and 44.78% for the fourth quarter
and year of 2000. This ratio compares very favorably to regional and national
peer group banking companies.
At the close of business on December 7, 2001, United acquired 100% of the
outstanding common stock of Century Bancshares, Inc., Washington, D.C. in a
transaction valued at approximately $63.8 million. At consummation, Century had
assets of approximately $414 million, loans of $295 million, deposits of $330
million and shareholders' equity of $20 million. Century added 11 full service
offices to United's existing presence in northern Virginia, Washington, D.C.,
and Montgomery County, Maryland.
Including the acquisition of Century, United's total assets as of December
31, 2001 increased $727.2 million or 14.8% from year-end 2000. Total loans,
including loans held for sale, increased $474.6 million or 13.98% while total
deposits increased $396.3 million or 11.69% during the year. Shareholders'
equity increased $75.7 million or 17.6% from December 31, 2000 translating into
a book value per share of $11.80. United is categorized as well capitalized
based on the regulatory risk-based capital ratio, considerably exceeding the
regulatory minimum requirement. These measures are additional evidence of
United's financial strength.
United's stock price closed the year at $28.86 per share, up 35.82% for the
year of 2001 while the Dow Jones Industrial, NASDAQ Composite, and S&P 500
Indexes closed down 7.11%, 21.06%, and 13.05%, respectively, for the year.
During the fourth quarter of 2001, United's Board of Directors declared a cash
dividend of 23c per share, a 10% increase over the 21c per share declared in the
fourth quarter of 2000. The 2001 dividend of 91c per share represents the
twenty-eighth consecutive year of dividend increases for United shareholders.
United Bankshares, with $5.6 billion in assets, has 86 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 and evolving banking industry
standards.
UNITED BANKSHARES, INC. AND SUBSIDIARIES
FINANCIAL SUMMARY
(In Thousands Except for Per Share Data)
Three Months Ended Year Ended
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December 31 December 31 December 31 December 31
2001 2000 2001 2000
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EARNINGS SUMMARY:
Interest income, taxable equivalent $ 89,575 $ 98,061 $ 372,248 $ 388,940
Interest expense 38,542 51,427 175,507 197,766
Net interest income, taxable equivalent 51,033 46,634 196,741 191,174
Taxable equivalent adjustment 2,954 2,843 11,638 11,903
Net interest income 48,079 43,791 185,103 180,081
Provision for loan losses 4,046 4,908 12,833 15,745
Income from mortgage banking operations 7,481 3,784 26,518 16,340
Gain (loss) on security transactions 705 (15,011) (518) (13,864)
Other noninterest income 9,422 8,424 36,205 31,310
Noninterest expenses 30,414 29,710 115,745 110,422
Income taxes 10,152 2,066 38,739 28,724
Net income 21,075 4,304 79,991 58,976
Cash dividends paid 9,892 8,872 38,096 35,285
PER COMMON SHARE:
Net income:
Basic 0.51 0.11 1.93 1.41
Diluted 0.49 0.11 1.90 1.40
Diluted - cash basis (A) 0.50 0.12 1.95 1.45
Cash dividends paid 0.23 0.21 0.91 0.84
Book value 11.80 10.32
Closing market price 28.86 21.25
Common shares outstanding:
Actual, net of treasury shares 42,926,511 41,765,271
Average basic 41,559,161 41,775,776 41,497,304 41,958,956
Average diluted 42,217,513 42,072,051 42,064,919 42,260,270
FINANCIAL RATIOS:
Return on average assets 1.58% 0.35% 1.59% 1.19%
Return on average shareholders' equity 17.36% 4.03% 17.51% 14.41%
Average equity to average assets 9.11% 8.69% 9.06% 8.29%
Net interest margin 4.07% 4.03% 4.12% 4.11%
December 31 December 31
2001 2000
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PERIOD END BALANCES:
Assets $ 5,631,775 $ 4,904,547
Earning assets 5,303,004 4,643,668
Loans, net of unearned income 3,502,334 3,192,494
Loans held for sale 368,625 203,831
Investment securities 1,430,709 1,245,334
Total deposits 3,787,793 3,391,449
Shareholders' equity 506,529 430,870
(A) Excludes the amortization of goodwill and other intangible assets.