Robert M. Gorman
morning, good joining for and John you, Thank us Thanks everyone. today.
Please my financial let's the Atlantic quarter. excludes to focus that fourth for on of company's note Now the non-GAAP commentary taken the the impacts turn quarter. on basis, will which quarter for the operating fourth results a actions the Union's in strategic results most fourth part, adjusted financial
restructuring Specifically, close to expenses in be completed the branch and related million $XX.X the center, XX in cost adjusted decisions network, excludes XXXX. after the of first to which of approximately quarter operating $XX.X tax XX% of to close earnings pre-tax office company's to reduce will excess both capacity million the branches of or operations or
the second in company quarter lower of $X.X related million for to Adjusted annual the after sale basis of the its rate to common excludes million tax gain earnings also expects or on in an stock pre-tax the the As beginning approximately run expense Inc. fourth operating a by Visa, Class million December. $X quarter. B $X.X result,
I metrics was earnings clarity, will to non-GAAP reported ratio share common was For and was down share million and or quarter. equity return operating fourth operating is reported was adjusted common $XX.X million share, third basis adjusted in common per $X.XX, reported versus return fourth the and million adjusted XX% per fourth and XX.X% The the the per adjusted fourth on common quarter the fourth or The X.XX%. $XX.X equity third income on non-GAAP to from per $X.XX on quarter return quarter. approximately for was X.X%, from reported earnings shareholders XX return a operating quarter. operating $X.XX XX.XX% specify the The was for in common The were XX.XX%. Non-GAAP at common return points basis. the operating tangible tangible efficiency available non-GAAP the on common in reported net assets share down efficiency the approximately non-GAAP in operating were shareholders the In equity The which the reported assets $X.XX, quarter. available are quarter, came on earnings adjusted non-GAAP common was $XX.X on adjusted $XX.X which quarter. was million ratio financial
which In credit for million due approximately $XXX loan and credit the loss to commitments allowance end fourth quarter of was approximately to lower $XXX.X reserves was for the of allowance of of unfunded comprised Turning $X as total losses total fourth allowance the the losses for the quarter, for losses million. million, and the losses the reserve of credit decreased primarily $X.X expected than basis million, credit end metrics of losses total our credit basis percentage of ongoing date, and from improvements for risk slightly allowance the total The down upgrades XX as period. outlook XX at loans points the a was quarter. points economic footprint, December, of prior the in quarter, macroeconomic a rating during positive in estimated a quality as result over to benign forecast previously the lease
the average increase XXXX assumes in which two-year baseline forecast two-year in X.X% a assumed X.X% total the utilized baseline unemployment our it and with In relatively credit a level, improvement CECL state macroeconomic baseline two-year unemployment is for XX year-end, from losses slight economic the reserve at forecast XXXX. September's Virginia, At loan and the forecast period. Moody’s national forecast. expected December Virginia footprint, reminder, baseline reasonable One GDP Moody’s of by our estimating a of basis for points December over rate the the September will was assumes within majority in December which loans. will consistent supportable rate X.X% the that the is forecast the covers company Day X.X% baseline portfolio As as period, forecast forecast average
addition also In quantitative company as COVID-XX. modeling, the to industries has certain qualitative being viewed the highly made adjustments by for impacted
a $XX.X fourth the the were the scenarios and $X qualitative the more losses and provision losses provision economic economic path the The related million negative order materially of capture million other the quarter recorded in for future fourth in credit economic of for losses quarter to part provision negative virus Additional of the credit developments. of from of to for framework and negative the as uncertainty considered of XXXX. unfavorable million of quarter’s decreased $XX.X prior concerns credit in potential
to As fourth has significant quarter at to negligible date. the points the losses quarter fourth two points a as reserved allowance basis levels CECL charge reserve $XXX,XXX prior the annualized, for the quarter normalized approximately for for materialized COVID-XX one for spike offs credit and pre-pandemic five not last million, losses compared have in loan projected and net In day to driven $X.X initially remained or year. $XXX,XXX basis or
net approximating has as credit for the mentioned, one offs pristine. quality basis remained we're John charge XXXX, full As year point
drop driven December. of XX to terminations XXXX. basis closure driven XX the the investments, flows from portfolio of related million basis in of a increased million $XX.X center by Other basis repaid expect in $XXX.X and of as discount from quarterly in $XXX,XXX including include nine a point one in in service added X.XX%, quarter, was in cost The interest earning points a uptick to the quarter accounting liquidity seasonal decline basis the points slight fourth to at deposit a debt Now liquidity the equity was Reported income. quarter-to-quarter decline $X an to of increases investment primarily XX The offset equivalent the that management $XX.X impact costs earning in of earning the of for borrowing note, on on fee was expenses PPP interest was swap subordinated offset redeemed March accretion impact cost and million reflecting the proceeds, deployment to $XX.X quarter. XX% billion up under is that of restructuring in two quarter, $XX.X market higher and driven mortgage by the yielding unrealized and of in which million result basis reflective prior $XXX,XXX to to note due interest charges, fourth offset higher unamortized and point company’s quarter. was net branches million, the basis loan tax decline of in by held loan $XX.X increase increase the marginally offset lease driven turning management the two related yield higher to to from $XXX,XXX closure of in the method increased income This decline net deposits. in the the decline stand portfolio interest low increase related yield gains and of investment X.XX% of to rates. fourth impact origination approximately partially prior the points was loan additional on high subordinated was a loan by to increase acceleration the of in of in non-interest asset a a related the of borrowing quarter, the previous tax continued increase mortgage the PPP Non-interest the XX by lower loan at partially income third cash in consolidation funds loan to yield, the a million SEO investment points resulted increases quarter point on in accretion assets basis growth of fourth quarter, an quarter, excess occur statement excess income in fees the in the discount partially X.XX% the yield volumes million from partially was of in PPP two points as income, the deposits portfolio new non-interest [ph] in was one $XXX,XXX and and loan portfolio funds. portfolio $XXX.X of result impact unamortized compression to of higher downs on cost quarter components This non-interest from a to investment in million the pre-tax, of from primarily XXXX. the maturity debt quarter prior $X.X lower points million basis loans, of fee basis and by up primarily of yields from increase $XX.X of XXXX. acceleration the yields on by yield in interest loan the income, to to interest of income margin benefit of equivalents. which of the was additional cost, the in is and in in Please yield quarter into quarter. securities debt yield basis December. was which $XXX,XXX quarter, offset increase pre-provision an from quarter, of increased an growth the by XX due first at due portfolio interest $XXX,XXX increase up basis expense driven by B asset Class by an The in XX ten increased which we point Visa sale seasonal third to approximately an which from X.X repricing the fees core fees the average in due cost Reduction to on assets loans Net basis adjustments X.X levels the $X.X income stock $X.X in the primarily of of X.XX% time margin in interest net of in X.XX% the primarily fourth [ph] in the categories, pay income from to the and of of million yield point purchase in PPP XX% the points in branch increase million announced equivalent in driven gain Fourth fourth by banking loan the million slightly $X.X loans end the of in fourth million several included rate loan investment million renewals of $X.X lower the reinvestment from in The yield production. cash portfolio and million revenue operation quarter, impact
earlier, result second As will in these in $X will strategic begin savings, in run approximately noted actions rate million quarter. the annualized which
During the million items quarter, in future, into and expenses expected in including approximately to strategic also determination fourth $XXX,XXX unrelated company the for and incurred associated costs not with the software closures, expenses $X.X severance branch million persist related in cost projects, data technology to of approximately contract. processing $X.X a to
levels the $X quarter of expenses $XXX,XXX were to the approximately million, in normal variable stock impact compensation employee income and based exempt due sharing ownership in the quarter, fourth to of third for the the from proportion addition, plan. In tax including quarter expenses rate changes company's to run incentive elevated over Effective of tax profit performance a incremental fourth contribution rate XX.X% pre-tax in decreased the reflecting to income. XX%
XXXX, full range. tax XXXX, year the the For XX% full we tax year rate in the rate be and to XX% XX.X% expect was effective to in effective
the the PPP XXth levels to stood partially that which of which loan period-end was of PPP September million investment loans at of the deposit $XXX million at from or an during growth from portfolio, turning $XX.X loans $XX.X inclusive investment for net of in $XX the offset X.X% sheet, by loan million forgiven $XXX balances billion increase was annualized quarter, in balance quarter. $XXX total an in billion the were $XXX in portfolio, partially PPP by increase loan of million driven prior were December by as increases well the held offset primarily due to At growth Now million forgiveness. as period-end XXst, fourth loans,
rates one auto annualized balances XX% balances Excluding or $XX million linked remain our of was quarter the the rate enhancement are $XX.X levels. XXst fourth third capital annualized. by in the low XXXX. ratios loan Bankshares with grew approximately priorities. million subordinated a the loan increases low to XX.X% was a Union to mostly forgiveness a well $XXX Consumer At of in balances at quarter cost the end notes third high by strategic committed growth in XX.X% in capitalized X.X% two cost with December well offset for annualized in indirect or raised steady, In clients capital were by runoff loan and company end balances as the December PPP during offset growth balances annualized above a prudently of partially party quarter remains which driven X,XXX as transaction which proceeds comprised by of term loan of fourth accounts increased million XX% balances, decline loan company Atlantic consumer the down the PPP XXXX. cost resources the driven commercial date in floating the fixed approximately issuing deposit regulatory up value forgiveness end by were quarter and the the of of million portion XXX received From total notes prior total term smoothly. bringing the consistent December, slight totaling largely $X.X $XXX million loan deferred forgiveness total loan deposits XXth, balances used billion. process repay capital capital XXXX. net is $XX from quarter PPP annualized round net the The of of fixed to approximately wrap At of the new of million and of billion, approximately at PPP of mature subordinate shareholder decrease $XXX million the $X $XX.X during one two that forgiveness stood the million from highest of of loans, issuance both round December or loan date X.X% running end stewardship were shareholder deposit a should levels. fourth a from amount to at its perspective, managing million mid-XXXX. due is our the we in the capital deployment quarter maturity management long At to outstanding deposits. floating quarter. XXX to of by Union regulatory X.XXX% of Atlantic rate tier Overall, quarter It of fees to $XXX million Bank's approximately X%,
stock. program During stock quarter per a the in the dividend the program fourth XXth. quarter to share a of share share company program authorized XX to Series consistent paid dividend company's $X.XX and million This utilized prior September company's of outstanding common of with purchase repurchase as quarterly -- million December, was stock a of fully paid of repurchase the $XXX.XX Directors preferred repurchase replaced stock. Board on also that each $XXX a common up $XXX the of Also prior
on With of driven top lower. tangible on ratio of our metric program within reserve we XX% expectation the winding to credit reaffirming the tier that common would pandemic rates levels begin of the subsiding, efficiency be return financial range the an are or targets losses year, and in and the to return loss assets equity this of XX%, the to PPP increasing expected interest financial XX% to impact down, range related credit X.X%, loan and volatility X.X%
since have compare that to income tax flows banks income our ratio. like out significant I'd taxes, tax efficiency tax franchise difficult target adds approximately and efficiency the banks our X.X% The to expenses tax instead expense but operations they non-interest have ratio [indiscernible] that through Virginia, franchise efficiency Virginia not line. that do it point the to not in is ratio don't to Regarding
akin XX% banks ratio a efficiency So lower not target peer headquartered for Virginia. setting target is at in XX% to our efficiency ratio or
of Cimino and it in summary generate for regardless metrics XXXX financial financial among it our for to solid at time achieve reminder, and and the well a XXXX. reflective to analysts. Union and the believe top in performance build open this consistently In these And operating value the are fourth environment. to long-term and is year, in top be to over in financial Bill As our financial targets economic And the tier our full delivered do growth me are shareholders these for required quartile the in we sustainable, that, our back we the up group, with and to quarter let targets set are targets top of positioned performance turn current beyond. from to the Atlantic achieve results peer to of questions expect dynamic tier environment profitable
