UMB Financial Corporation
10/29/2026 | Press release | Distributed by Public on 10/29/2026 07:02
Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Management's Discussion and Analysis of Financial Condition and Results of Operations highlights the material changes in the results of operations and changes in financial condition of the Company for the three and nine months ended September 30, 2026. It should be read in conjunction with the accompanying Consolidated Financial Statements, Notes to Consolidated Financial Statements and other financial information appearing elsewhere in this Form 10-Q and the Form 10-K. Results of operations for the periods included in this review are not necessarily indicative of results to be attained during any future period.
CAUTIONARY NOTICE ABOUT FORWARD-LOOKING STATEMENTS
From time to time the Company has made, and in the future will make, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as "believe," "expect," "anticipate," "intend," "estimate," "project," "outlook," "forecast," "target," "trend," "plan," "goal," or other words of comparable meaning or future-tense or conditional verbs such as "may," "will," "should," "would," or "could." Forward-looking statements convey the Company's expectations, intentions, or forecasts about future events, circumstances, results, or aspirations, in each case as of the date such forward-looking statements are made.
This Form 10-Q, including any information incorporated by reference in this Form 10-Q, contains forward-looking statements. The Company also may make forward-looking statements in other documents that are filed or furnished with the Securities and Exchange Commission. In addition, the Company may make forward-looking statements orally or in writing to investors, analysts, members of the media, or others.
All forward-looking statements, by their nature, are subject to assumptions, risks, and uncertainties, which may change over time and many of which are beyond the Company's control. You should not rely on any forward-looking statement as a prediction or guarantee about the future. Actual future objectives, strategies, plans, prospects, performance, conditions, or results may differ materially from those set forth in any forward-looking statement. While no list of assumptions, risks, or uncertainties could be complete, some of the factors that may cause actual results or other future events, circumstances, or aspirations to differ from those in forward-looking statements include:
•
local, regional, national, or international business, economic, or political conditions or events;
•
changes in laws or the regulatory environment, including as a result of financial-services legislation or regulation;
•
changes in monetary, fiscal, or trade laws or policies, including as a result of actions by central banks or supranational authorities;
•
the pace and magnitude of interest rate movements;
•
changes in accounting standards or policies;
•
shifts in investor sentiment or behavior in the securities, capital, or other financial markets, including changes in market liquidity or volatility or changes in interest or currency rates;
•
changes in spending, borrowing, or saving by businesses or households;
•
the Company's ability to effectively manage capital or liquidity or to effectively attract or deploy deposits;
•
changes in any credit rating assigned to the Company or its affiliates;
•
adverse publicity or other reputational harm to the Company;
•
changes in the Company's corporate strategies, the composition of its assets, or the way in which it funds those assets;
•
the Company's ability to develop, maintain, or market products or services or to absorb unanticipated costs or liabilities associated with those products or services;
•
the Company's ability to innovate to anticipate the needs of current or future customers, to successfully compete in its chosen business lines, to increase or hold market share in changing competitive environments, or to deal with pricing or other competitive pressures;
•
changes in the credit, liquidity, or other condition of the Company's customers, counterparties, or competitors;
•
the Company's ability to effectively deal with economic, business, or market slowdowns or disruptions;
•
judicial, regulatory, or administrative investigations, proceedings, disputes, or rulings that create uncertainty for, or are adverse to, the Company or the financial-services industry;
•
the Company's ability to address changing or stricter regulatory or other governmental supervision or requirements;
•
the Company's ability to maintain secure and functional financial, accounting, technology, data processing, or other operating systems or facilities, including its capacity to withstand cyber-attacks;
•
the adequacy of the Company's corporate governance, risk-management framework, compliance programs, or internal controls, including its ability to control lapses or deficiencies in financial reporting or to effectively mitigate or manage operational risk;
•
the efficacy of the Company's methods or models in assessing business strategies or opportunities or in valuing, measuring, monitoring, or managing positions or risk;
•
the Company's ability to keep pace with changes in technology that affect the Company or its customers, counterparties, or competitors, including technology changes with respect to digital assets;
•
an increase of competitors that provide products or services offered by the Company, including competitors that may be subject to different regulatory standards or requirements;
•
mergers, acquisitions, or dispositions, including the Company's ability to integrate acquisitions and divest assets;
•
the Company's ability to manage the expenses associated with the merger with HTLF and the impact these expenses may have on the Company's financial results;
•
the benefits from the merger with HTLF may not be fully realized or may take longer to realize than expected;
•
the Company's ability to promptly and effectively integrate the merger of HTLF;
•
the adequacy of the Company's succession planning for key executives or other personnel;
•
the Company's ability to grow revenue, control expenses, or attract and retain qualified employees;
•
natural disasters, war, terrorist activities, including instability in the Middle East and Russia's military action in Ukraine and developments in Latin America, pandemics, and their effects on economic and business environments in which the Company operates;
•
macroeconomic and adverse developments and uncertainties related to the collateral effects of the collapse of, and challenges for, domestic and international banks, including the impacts to the U.S. and global economies and reputational harm to the U.S. banking system; or
•
other assumptions, risks, or uncertainties described in the Notes to Consolidated Financial Statements (Item 1) and Management's Discussion and Analysis of Financial Condition and Results of Operations (Item 2) in this Form 10-Q, in the Risk Factors (Item 1A) in the Form 10-K, or in any of the Company's quarterly or current reports.
Any forward-looking statement made by the Company or on its behalf speaks only as of the date that it was made. The Company does not undertake to update any forward-looking statement to reflect the impact of events, circumstances, or results that arise after the date that the statement was made, except as required by applicable
securities laws. You, however, should consult further disclosures (including disclosures of a forward-looking nature) that the Company may make in any subsequent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, or Current Report on Form 8-K.
Overview
On January 31, 2025, UMBF completed its acquisition of Heartland Financial, USA, Inc. (HTLF). The acquisition added assets with a fair value of approximately $16.1 billion, $9.7 billion of loans, net of the allowance for credit losses, and $14.3 billion of deposits. The combined company retains its #1 deposit market share in Missouri and now ranks in the top 10 in Colorado, New Mexico, Kansas, and Arizona.
The Company focuses on the following four core financial objectives. Management believes these objectives will guide its efforts to achieve its vision, to deliver the Unparalleled Customer Experience, all while seeking to improve net income and strengthen the balance sheet while undertaking prudent risk management.
The first financial objective is to continuously improve operating efficiencies. The Company has focused on identifying efficiencies that simplify its organizational and reporting structures, streamline back-office functions, and take advantage of synergies and newer technologies among various platforms and distribution networks. The Company has identified and expects to continue identifying ongoing efficiencies through the normal course of business that, when combined with increased revenue, will contribute to improved operating leverage. During the third quarter of 2026, total revenue increased $94.0 million, or 13.9%, as compared to the third quarter of 2025, while noninterest expense decreased $19.8 million, or 4.7%, for the same period. Included in noninterest expense for the third quarter of 2025 is $35.6 million in acquisition-related expense compared to $0.1 million in the third quarter of 2026. Revenue is also impacted by accretion and amortization of the fair value adjustments discussed in Note 13, "Acquisition" above. As part of the initiative to improve operating efficiencies, the Company continues to invest in technological advances that it believes will help management drive operating leverage in the future through improved data analysis and automation. The Company also continues to evaluate core systems and will invest in enhancements that it believes will yield operating efficiencies.
The second financial objective is to increase net interest income through profitable loan and deposit growth and the optimization of the balance sheet. During the third quarter of 2026, the Company had an increase in net interest income of $65.0 million, or 13.7%, from the same period in 2025. The change in net interest income was primarily driven by increases of $4.6 billion, or 12.4%, in average loans and $722.9 million, or 3.8%, in average securities, as well as favorable repricing of deposits in conjunction with lower short-term interest rates. These increases were partially offset by a decrease of $3.1 billion, or 49.0%, in average interest-bearing due from banks and $7.5 million in lower purchase accounting accretion income. The funding for these assets was driven by an increase in average interest-bearing deposits of 3.5%, compared to the third quarter of 2025. Net interest margin, on a tax-equivalent basis, increased 28 basis points compared to the same period in 2025, primarily driven by favorable repricing of deposits in conjunction with lower short-term interest rates. Net interest spread increased 39 basis points during the same period. The Company expects to see continued volatility in the economic markets resulting from governmental responses to inflation and recessionary signs in the economy, as well as uncertainty about the impacts of the conflict in Iran and tariffs. These changing conditions could have impacts on the balance sheet and income statement of the Company for the remainder of the year.
The third financial objective is to grow the Company's revenue from noninterest sources. The Company seeks to grow noninterest revenues throughout all economic and interest rate cycles, while positioning itself to benefit in periods of economic growth. Noninterest income increased $29.1 million, or 14.3%, to $232.4 million for the three months ended September 30, 2026, compared to the same period in 2025. See greater detail below under Noninterest Income. The Company continues to emphasize its asset management, brokerage, bankcard services, healthcare services, and treasury management businesses. For the three months ended September 30, 2026, noninterest income represented 30.1% of total revenue, compared to 30.0% for the same period in 2025. The recent economic changes have impacted fee income, especially those with assets tied to market values and interest rates.
The fourth financial objective is effective capital management. The Company places a significant emphasis on maintaining a strong capital position, which management believes promotes investor confidence, provides access to funding sources under favorable terms, and enhances the Company's ability to capitalize on business growth and
acquisition opportunities. The Company continues to maximize shareholder value through a mix of reinvesting in organic growth, evaluating acquisition opportunities that complement the Company's strategies, increasing dividends over time, and appropriately utilizing a share repurchase program. At September 30, 2026, the Company had $7.9 billion in total shareholders' equity. This is an increase of $408.9 million, or 5.5%, compared to total shareholders' equity at September 30, 2025. At September 30, 2026, the Company had a total risk-based capital ratio of 13.52%. The Company did not repurchase shares of common stock during the third quarter of 2026, other than shares acquired pursuant to the Company's share-based incentive programs.
On October 27, 2026, the Company announced that it entered into a merger agreement with El Dorado Savings Bank, F.S.B. ("El Dorado") headquartered in Placerville, CA, under which the Company will acquire El Dorado in a 52% cash, 48% stock transaction valued at approximately $506 million. As of September 30, 2026, El Dorado has $2.4 billion in assets, $2.1 billion in total deposits, and $0.5 billion in total loans. The merger has been approved by the board of directors of each company and will close subject to the satisfaction of customary closing conditions, including the receipt of regulatory approvals and approval by the shareholders of El Dorado.
Earnings Summary
The following is a summary regarding the Company's earnings for the third quarter of 2026. The changes identified in the summary are explained in greater detail below. The Company recorded net income available to common shareholders of $272.3 million for the three-month period ended September 30, 2026, compared to net income available to common shareholders of $180.4 million for the same period a year earlier. Basic earnings per common share for the third quarter of 2026 were $3.58 per share ($3.56 per share fully-diluted) compared to $2.38 per common share ($2.36 per share fully-diluted) for the third quarter of 2025. Return on average assets and return on average common shareholders' equity for the three-month period ended September 30, 2026 were 1.53% and 13.83%, respectively, compared to 1.04% and 10.14%, respectively, for the three-month period ended September 30, 2025.
The Company recorded net income available to common shareholders of $799.7 million for the nine-month period ended September 30, 2026, compared to net income available to common shareholders of $475.1 million for the same period a year earlier. Basic earnings per common share for the nine-month period ended September 30, 2026 were $10.52 per share ($10.46 per share fully-diluted) compared to $6.57 per share ($6.53 per share fully-diluted) for the same period in 2025. Return on average assets and return on average common shareholders' equity for the nine-month period ended September 30, 2026 were 1.52% and 13.90%, respectively, compared to 0.98% and 9.84%, respectively, for the nine-month period ended September 30, 2025.
Net interest income for the three and nine-month periods ended September 30, 2026 increased $65.0 million, or 13.7%, and increased $267.2 million, or 19.9%, respectively, compared to the same periods in 2025. For the three-month period ended September 30, 2026, average earning assets increased by $2.5 billion, or 4.0%, and for the nine-month period ended September 30, 2026, they increased by $5.3 billion, or 8.9%, compared to the same periods in 2025. Net interest margin, on a tax-equivalent basis, increased to 3.32% and 3.34%, respectively, for the three and nine-month periods ended September 30, 2026, compared to 3.04% and 3.04%, respectively, for the same periods in 2025.
The provision for credit losses increased by $8.5 million for the three-month period ended September 30, 2026 and decreased by $43.5 million for the nine-month period ended September 30, 2026, as compared to the same periods in 2025. Provision expense for the nine-month period in 2025 included $62.0 million to establish an allowance for credit losses on the acquired loans designated as non-PCD loans at the close of the transaction. See Note 13, "Acquisition" above. The remainder of the increase in provision was driven by loan growth, general portfolio trends, and ongoing recalibrations of econometric loss models in the current period as compared to the prior periods. The Company's nonperforming loans decreased $14.1 million to $117.9 million at September 30, 2026, compared to September 30, 2025. The ACL on loans as a percentage of total loans decreased to 1.06% as of September 30, 2026, compared to 1.07% at September 30, 2025. For a description of the Company's methodology for computing the ACL, please see the summary discussion in the "Provision and Allowance for Credit Losses" section included below.
Noninterest income increased by $29.1 million, or 14.3%, for the three-month period ended September 30, 2026, and increased by $91.0 million, or 15.4%, for the nine-month period ended September 30, 2026, compared to the same periods in 2025. These changes are discussed in greater detail below under Noninterest Income.
Noninterest expense decreased by $19.8 million, or 4.7%, for the three-month period ended September 30, 2026, and decreased by $17.3 million, or 1.4%, for the nine-month period ended September 30, 2026, compared to the same periods in 2025. These changes are discussed in greater detail below under Noninterest Expense.
Net Interest Income
Net interest income is a significant source of the Company's earnings and represents the amount by which interest income on earning assets exceeds the interest expense paid on liabilities. The volume of interest-earning assets and the related funding sources, the overall mix of these assets and liabilities, and the rates paid on each affect net interest income. Net interest income for the three and nine-month periods ended September 30, 2026 increased $65.0 million, or 13.7%, and increased $267.2 million, or 19.9%, compared to the same periods in 2025. The change in net interest income was primarily driven by favorable repricing of deposits in conjunction with lower short-term interest rates, and increases in average loans and average securities. These increases were partially offset by decreases in average interest-bearing due from banks and purchase accounting accretion income.
Table 1 shows the impact of earning asset rate changes compared to changes in the cost of interest-bearing liabilities. As illustrated in this table, net interest spread for the three months ended September 30, 2026 increased 39 basis points as compared to the same period in 2025. Net interest margin for the three months ended September 30, 2026 increased 28 basis points compared to the same period in 2025. Net interest spread for the nine-month period ended September 30, 2026 increased by 43 basis points as compared to the same period in 2025. Net interest margin for the nine-month period ended September 30, 2026 increased by 30 basis points compared to the same period in 2025. The change is driven by favorable repricing of deposits in conjunction with lower short-term interest rates. The cost of interest-bearing liabilities decreased 51 basis points from the third quarter of 2025 while the yield on earning assets decreased 12 basis points compared to the same period. The cost of interest-bearing liabilities decreased 54 basis points for the nine-month period ended September 30, 2026 as compared to the same period in 2025 while the yield on earning assets decreased 11 basis points compared to the same period. Earning asset balance increases have been primarily driven by higher average loans and increased securities balances, partially offset by decreased interest-bearing due from banks balances. These variances have led to an increase in the Company's net interest income during 2026, as compared to results for the same periods in 2025. The Company expects to see continued volatility in the economic markets and governmental responses to changes in the economy. These changing conditions could have impacts on the balance sheet and income statement of the Company for the remainder of the year. For the impact of the contribution from free funds, see the Analysis of Net Interest Margin within Table 2 below. Table 2 also illustrates how the changes in volume and interest rates have resulted in an increase in net interest income.
Table 1
AVERAGE BALANCE SHEETS/YIELDS AND RATES (tax-equivalent basis) (unaudited, dollars in thousands)
The following table presents, for the periods indicated, the average earning assets and resulting yields, as well as the average interest-bearing liabilities and resulting yields, expressed in both dollars and rates. All average balances are daily average balances. The average yield on earning assets without the tax-equivalent basis adjustment would have been 5.41% for the three-month period ended September 30, 2026, and 5.53% for the same period in 2025. The average yield on earning assets without the tax-equivalent basis adjustment would have been 5.39% for the nine-month period ended September 30, 2026, and 5.49% for the same period in 2025.
|
Three Months Ended September 30, |
|||||||||||||||||
|
2026 |
2025 |
||||||||||||||||
|
Average |
Average |
Average |
Average |
||||||||||||||
|
Balance |
Yield/Rate |
Balance |
Yield/Rate |
||||||||||||||
|
ASSETS |
|||||||||||||||||
|
Loans, net of unearned interest |
$ |
41,749,588 |
6.36 |
% |
$ |
37,138,511 |
6.72 |
% |
|||||||||
|
Securities: |
|||||||||||||||||
|
Taxable |
15,340,425 |
3.84 |
14,798,834 |
3.70 |
|||||||||||||
|
Tax-exempt |
4,369,928 |
4.07 |
4,207,894 |
3.89 |
|||||||||||||
|
Total securities |
19,710,353 |
3.89 |
19,006,728 |
3.75 |
|||||||||||||
|
Federal funds and resell agreements |
978,399 |
4.45 |
727,473 |
5.11 |
|||||||||||||
|
Interest-bearing due from banks |
3,172,756 |
3.71 |
6,223,615 |
4.40 |
|||||||||||||
|
Other earning assets |
31,366 |
6.72 |
12,098 |
10.72 |
|||||||||||||
|
Total earning assets |
65,642,462 |
5.46 |
63,108,425 |
5.58 |
|||||||||||||
|
Allowance for credit losses |
(438,567 |
) |
(388,761 |
) |
|||||||||||||
|
Other assets |
5,610,758 |
5,775,638 |
|||||||||||||||
|
Total assets |
$ |
70,814,653 |
$ |
68,495,302 |
|||||||||||||
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||||||||||||||||
|
Interest-bearing deposits |
$ |
44,401,744 |
2.84 |
% |
$ |
42,904,766 |
3.36 |
% |
|||||||||
|
Federal funds and repurchase agreements |
3,096,558 |
3.33 |
2,863,481 |
3.97 |
|||||||||||||
|
Borrowed funds |
448,907 |
9.85 |
627,827 |
7.80 |
|||||||||||||
|
Total interest-bearing liabilities |
47,947,209 |
2.94 |
46,396,074 |
3.45 |
|||||||||||||
|
Noninterest-bearing demand deposits |
13,819,642 |
13,858,827 |
|||||||||||||||
|
Other liabilities |
957,438 |
879,659 |
|||||||||||||||
|
Shareholders' equity |
8,090,364 |
7,360,742 |
|||||||||||||||
|
Total liabilities and shareholders' equity |
$ |
70,814,653 |
$ |
68,495,302 |
|||||||||||||
|
Net interest spread |
2.52 |
% |
2.13 |
% |
|||||||||||||
|
Net interest margin |
3.32 |
3.04 |
|||||||||||||||
|
Nine Months Ended September 30, |
|||||||||||||||||
|
2026 |
2025 |
||||||||||||||||
|
Average |
Average |
Average |
Average |
||||||||||||||
|
Balance |
Yield/Rate |
Balance |
Yield/Rate |
||||||||||||||
|
ASSETS |
|||||||||||||||||
|
Loans, net of unearned interest |
$ |
40,594,251 |
6.41 |
% |
$ |
35,302,675 |
6.70 |
% |
|||||||||
|
Securities: |
|||||||||||||||||
|
Taxable |
15,523,910 |
3.79 |
13,312,899 |
3.60 |
|||||||||||||
|
Tax-exempt |
4,353,801 |
4.05 |
4,201,302 |
3.82 |
|||||||||||||
|
Total securities |
19,877,711 |
3.85 |
17,514,201 |
3.65 |
|||||||||||||
|
Federal funds and resell agreements |
1,181,976 |
4.33 |
656,637 |
5.10 |
|||||||||||||
|
Interest-bearing due from banks |
3,688,901 |
3.68 |
6,562,011 |
4.44 |
|||||||||||||
|
Other earning assets |
25,203 |
6.47 |
16,519 |
8.00 |
|||||||||||||
|
Total earning assets |
65,368,042 |
5.44 |
60,052,043 |
5.55 |
|||||||||||||
|
Allowance for credit losses |
(425,183 |
) |
(359,267 |
) |
|||||||||||||
|
Other assets |
5,614,390 |
5,449,485 |
|||||||||||||||
|
Total assets |
$ |
70,557,249 |
$ |
65,142,261 |
|||||||||||||
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||||||||||||||||
|
Interest-bearing deposits |
$ |
43,255,400 |
2.81 |
% |
$ |
40,357,901 |
3.34 |
% |
|||||||||
|
Federal funds and repurchase agreements |
3,408,806 |
3.32 |
2,775,160 |
3.94 |
|||||||||||||
|
Borrowed funds |
467,563 |
9.36 |
618,153 |
7.88 |
|||||||||||||
|
Total interest-bearing liabilities |
47,131,769 |
2.91 |
43,751,214 |
3.45 |
|||||||||||||
|
Noninterest-bearing demand deposits |
14,540,507 |
13,898,325 |
|||||||||||||||
|
Other liabilities |
904,745 |
856,522 |
|||||||||||||||
|
Shareholders' equity |
7,980,228 |
6,636,200 |
|||||||||||||||
|
Total liabilities and shareholders' equity |
$ |
70,557,249 |
$ |
65,142,261 |
|||||||||||||
|
Net interest spread |
2.53 |
% |
2.10 |
% |
|||||||||||||
|
Net interest margin |
3.34 |
3.04 |
|||||||||||||||
Table 2 presents the dollar amount of change in net interest income and margin due to volume and rate. Table 2 also reflects the effect that interest-free funds have on net interest margin. The average balance of interest-free funds (total earning assets less interest-bearing liabilities) increased $1.0 billion and $1.9 billion for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025. The benefit from interest-free funds decreased 11 basis points and 13 basis points in the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025.
Table 2
ANALYSIS OF CHANGES IN NET INTEREST INCOME AND MARGIN (unaudited, dollars in thousands)
ANALYSIS OF CHANGES IN NET INTEREST INCOME
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||||||||||
|
September 30, 2026 vs. 2025 |
September 30, 2026 vs. 2025 |
|||||||||||||||||||||||
|
Volume |
Rate |
Total |
Volume |
Rate |
Total |
|||||||||||||||||||
|
Change in interest earned on: |
||||||||||||||||||||||||
|
Loans |
$ |
75,222 |
$ |
(34,609 |
) |
$ |
40,613 |
$ |
256,345 |
$ |
(78,477 |
) |
$ |
177,868 |
||||||||||
|
Securities: |
||||||||||||||||||||||||
|
Taxable |
5,149 |
5,031 |
10,180 |
61,952 |
19,587 |
81,539 |
||||||||||||||||||
|
Tax-exempt |
1,441 |
1,720 |
3,161 |
3,645 |
6,164 |
9,809 |
||||||||||||||||||
|
Federal funds sold and resell agreements |
2,929 |
(1,310 |
) |
1,619 |
17,502 |
(4,246 |
) |
13,256 |
||||||||||||||||
|
Interest-bearing due from banks |
(29,799 |
) |
(9,488 |
) |
(39,287 |
) |
(83,643 |
) |
(32,651 |
) |
(116,294 |
) |
||||||||||||
|
Trading |
369 |
(157 |
) |
212 |
457 |
(211 |
) |
246 |
||||||||||||||||
|
Interest income |
55,311 |
(38,813 |
) |
16,498 |
256,258 |
(89,834 |
) |
166,424 |
||||||||||||||||
|
Change in interest incurred on: |
||||||||||||||||||||||||
|
Interest-bearing deposits |
12,302 |
(56,959 |
) |
(44,657 |
) |
68,886 |
(168,802 |
) |
(99,916 |
) |
||||||||||||||
|
Federal funds purchased and repurchase agreements |
2,205 |
(4,820 |
) |
(2,615 |
) |
16,944 |
(14,121 |
) |
2,823 |
|||||||||||||||
|
Other borrowed funds |
(3,998 |
) |
2,805 |
(1,193 |
) |
(9,814 |
) |
6,140 |
(3,674 |
) |
||||||||||||||
|
Interest expense |
10,509 |
(58,974 |
) |
(48,465 |
) |
76,016 |
(176,783 |
) |
(100,767 |
) |
||||||||||||||
|
Net interest income |
$ |
44,802 |
$ |
20,161 |
$ |
64,963 |
$ |
180,242 |
$ |
86,949 |
$ |
267,191 |
||||||||||||
ANALYSIS OF NET INTEREST MARGIN
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||||||||||
|
2026 |
2025 |
Change |
2026 |
2025 |
Change |
|||||||||||||||||||
|
Average earning assets |
$ |
65,642,462 |
$ |
63,108,425 |
$ |
2,534,037 |
$ |
65,368,042 |
$ |
60,052,043 |
$ |
5,315,999 |
||||||||||||
|
Interest-bearing liabilities |
47,947,209 |
46,396,074 |
1,551,135 |
47,131,769 |
43,751,214 |
3,380,555 |
||||||||||||||||||
|
Interest-free funds |
$ |
17,695,253 |
$ |
16,712,351 |
$ |
982,902 |
$ |
18,236,273 |
$ |
16,300,829 |
$ |
1,935,444 |
||||||||||||
|
Free funds ratio (interest-free funds to average earning assets) |
26.96 |
% |
26.48 |
% |
0.48 |
% |
27.90 |
% |
27.14 |
% |
0.76 |
% |
||||||||||||
|
Tax-equivalent yield on earning assets |
5.46 |
5.58 |
(0.12 |
) |
5.44 |
5.55 |
(0.11 |
) |
||||||||||||||||
|
Cost of interest-bearing liabilities |
2.94 |
3.45 |
(0.51 |
) |
2.91 |
3.45 |
(0.54 |
) |
||||||||||||||||
|
Net interest spread |
2.52 |
2.13 |
0.39 |
2.53 |
2.10 |
0.43 |
||||||||||||||||||
|
Benefit of interest-free funds |
0.80 |
0.91 |
(0.11 |
) |
0.81 |
0.94 |
(0.13 |
) |
||||||||||||||||
|
Net interest margin |
3.32 |
% |
3.04 |
% |
0.28 |
% |
3.34 |
% |
3.04 |
% |
0.30 |
% |
||||||||||||
Provision and Allowance for Credit Losses
The ACL represents management's judgment of the total expected losses included in the Company's loan portfolio as of the balance sheet date. The Company's process for recording the ACL is based on the evaluation of the Company's lifetime historical loss experience, management's understanding of the credit quality inherent in the loan portfolio, and the impact of the current economic environment, coupled with reasonable and supportable economic forecasts.
A mathematical calculation of an estimate is made to assist in determining the adequacy and reasonableness of management's recorded ACL. To develop the estimate, the Company follows the guidelines in ASC 326, Financial Instruments - Credit Losses. The estimate reserves for assets held at amortized cost and any related credit deterioration in the Company's available-for-sale debt security portfolio. Assets held at amortized cost include the Company's loan book and held-to-maturity security portfolio.
The process involves the consideration of quantitative and qualitative factors relevant to the specific segmentation of loans. These factors have been established over decades of financial institution experience and include economic observation and loan loss characteristics. This process is designed to produce a lifetime estimate of the losses, at a reporting date, that includes evaluation of historical loss experience, current economic conditions, reasonable and supportable forecasts, and the qualitative framework outlined by the Office of the Comptroller of the Currency in the published 2020 Interagency Policy Statement. This process allows management to take a holistic view of the recorded ACL reserve and ensure that all significant and pertinent information is considered.
The Company considers a variety of factors to ensure the safety and soundness of its estimate including a strong internal control framework, extensive methodology documentation, credit underwriting standards which encompass the Company's desired risk profile, model validation, and ratio analysis. If the Company's total ACL estimate, as determined in accordance with the approved ACL methodology, is either outside a reasonable range based on review of economic indicators or by comparison of historical ratio analysis, the ACL estimate is an outlier and management will investigate the underlying reason(s). Based on that investigation, issues or factors that previously had not been considered may be identified in the estimation process, which may warrant adjustments to estimated credit losses.
The end result of this process is a recorded consolidated ACL that represents management's best estimate of the total expected losses included in the loan portfolio, held-to-maturity securities, and credit deterioration in available-for-sale securities.
Based on the factors above, management of the Company recorded $31.0 million as provision for credit losses for the three-month period ended September 30, 2026, as compared to $22.5 million for the same period in 2025. For the nine-month period ended September 30, 2026, management of the Company recorded $86.0 million as provision for credit losses, as compared to $129.5 million for the same period in 2025. As noted above, $62.0 million was recorded to establish an allowance for credit losses on the acquired loans designated as non-PCD loans at the close of the HTLF acquisition in the first quarter of 2025. See Note 13, "Acquisition" above. The increase in the three-month period and the remaining $18.5 million increase in provision in the nine-month period is the result of applying the methodology for computing the ACL, coupled with the impacts of the current and forecasted economic environment. As illustrated in Table 3 below, the ACL was 1.06% of total loans as of September 30, 2026, compared to 1.07% as of September 30, 2025.
Table 3 presents a summary of the Company's ACL for the nine-month periods ended September 30, 2026 and 2025, and for the year ended December 31, 2025. Net charge-offs were $48.8 million for the nine-month period ended September 30, 2026, compared to $69.7 million for the same period in 2025. See "Credit Risk Management" under "Item 3. Quantitative and Qualitative Disclosures About Market Risk" in this report for information relating to nonaccrual loans, past due loans, restructured loans and other credit risk matters.
Table 3
ANALYSIS OF ALLOWANCE FOR CREDIT LOSSES (unaudited, dollars in thousands)
|
Nine Months Ended |
Year Ended |
|||||||||||
|
September 30, |
December 31, |
|||||||||||
|
2026 |
2025 |
2025 |
||||||||||
|
Allowance - January 1 |
$ |
421,162 |
$ |
261,734 |
$ |
261,734 |
||||||
|
PCD allowance for credit loss at acquisition |
- |
85,299 |
85,299 |
|||||||||
|
Provision for credit losses |
84,000 |
129,500 |
156,500 |
|||||||||
|
Charge-offs: |
||||||||||||
|
Commercial and industrial |
(16,519 |
) |
(38,035 |
) |
(44,645 |
) |
||||||
|
Specialty lending |
- |
- |
- |
|||||||||
|
Commercial real estate |
(16,592 |
) |
(11,074 |
) |
(11,792 |
) |
||||||
|
Consumer real estate |
(1,433 |
) |
(2,050 |
) |
(2,041 |
) |
||||||
|
Consumer |
(3,259 |
) |
(2,253 |
) |
(3,538 |
) |
||||||
|
Credit cards |
(17,615 |
) |
(20,020 |
) |
(25,676 |
) |
||||||
|
Leases and other |
(17 |
) |
(7 |
) |
(27 |
) |
||||||
|
Total charge-offs |
(55,435 |
) |
(73,439 |
) |
(87,719 |
) |
||||||
|
Recoveries: |
||||||||||||
|
Commercial and industrial |
2,010 |
254 |
507 |
|||||||||
|
Specialty lending |
- |
- |
- |
|||||||||
|
Commercial real estate |
29 |
184 |
196 |
|||||||||
|
Consumer real estate |
279 |
238 |
275 |
|||||||||
|
Consumer |
711 |
420 |
845 |
|||||||||
|
Credit cards |
3,593 |
2,620 |
3,519 |
|||||||||
|
Leases and other |
20 |
6 |
6 |
|||||||||
|
Total recoveries |
6,642 |
3,722 |
5,348 |
|||||||||
|
Net charge-offs |
(48,793 |
) |
(69,717 |
) |
(82,371 |
) |
||||||
|
Allowance for credit losses - end of period |
$ |
456,369 |
$ |
406,816 |
$ |
421,162 |
||||||
|
Allowance for credit losses on loans |
$ |
452,414 |
$ |
404,971 |
$ |
419,478 |
||||||
|
Allowance for credit losses on held-to-maturity securities |
3,955 |
1,845 |
1,684 |
|||||||||
|
Loans at end of period, net of unearned interest |
42,530,123 |
37,706,507 |
38,779,408 |
|||||||||
|
Held-to-maturity securities at end of period |
5,706,307 |
5,654,232 |
5,724,227 |
|||||||||
|
Total assets at amortized cost |
48,236,430 |
43,360,739 |
44,503,635 |
|||||||||
|
Average loans, net of unearned interest |
40,590,247 |
35,299,314 |
36,065,953 |
|||||||||
|
Allowance for credit losses on loans to loans at end of period |
1.06 |
% |
1.07 |
% |
1.08 |
% |
||||||
|
Allowance for credit losses - end of period to total assets at amortized cost |
0.95 |
% |
0.94 |
% |
0.95 |
% |
||||||
|
Allowance as a multiple of net charge-offs |
7.00x |
4.36x |
5.11x |
|||||||||
|
Net charge-offs to average loans |
0.16 |
% |
0.26 |
% |
0.23 |
% |
||||||
Noninterest Income
A key objective of the Company is the growth of noninterest income to provide a diverse source of revenue not directly tied to interest rates. Fee-based services are typically non-credit related and are not generally affected by fluctuations in interest rates.
The Company offers multiple fee-based products and services, which management believes will more closely align with customer demands. The Company is currently emphasizing fee-based products and services including trust and securities processing, bankcard, securities trading and brokerage, and cash and treasury management. Management believes that it can offer these products and services both efficiently and profitably, as most have common platforms and support structures.
Table 4
SUMMARY OF NONINTEREST INCOME (unaudited, dollars in thousands)
|
Three Months Ended |
Dollar |
Percent |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2026 |
2025 |
26-25 |
26-25 |
|||||||||||||
|
Trust and securities processing |
$ |
104,033 |
$ |
87,926 |
$ |
16,107 |
18.3 |
% |
||||||||
|
Trading and investment banking |
5,269 |
7,026 |
(1,757 |
) |
(25.0 |
) |
||||||||||
|
Service charges on deposits |
31,460 |
29,150 |
2,310 |
7.9 |
||||||||||||
|
Insurance fees and commissions |
148 |
307 |
(159 |
) |
(51.8 |
) |
||||||||||
|
Brokerage fees |
24,181 |
20,470 |
3,711 |
18.1 |
||||||||||||
|
Bankcard fees |
29,453 |
29,561 |
(108 |
) |
(0.4 |
) |
||||||||||
|
Investment securities gains (losses), net |
11,009 |
(4,093 |
) |
15,102 |
369.0 |
|||||||||||
|
Other |
26,830 |
32,951 |
(6,121 |
) |
(18.6 |
) |
||||||||||
|
Total noninterest income |
$ |
232,383 |
$ |
203,298 |
$ |
29,085 |
14.3 |
% |
||||||||
|
Nine Months Ended |
Dollar |
Percent |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2026 |
2025 |
26-25 |
26-25 |
|||||||||||||
|
Trust and securities processing |
$ |
296,995 |
$ |
250,970 |
$ |
46,025 |
18.3 |
% |
||||||||
|
Trading and investment banking |
18,323 |
19,107 |
(784 |
) |
(4.1 |
) |
||||||||||
|
Service charges on deposits |
90,522 |
85,472 |
5,050 |
5.9 |
||||||||||||
|
Insurance fees and commissions |
610 |
674 |
(64 |
) |
(9.5 |
) |
||||||||||
|
Brokerage fees |
70,670 |
59,097 |
11,573 |
19.6 |
||||||||||||
|
Bankcard fees |
88,285 |
84,872 |
3,413 |
4.0 |
||||||||||||
|
Investment securities gains, net |
41,142 |
28,810 |
12,332 |
42.8 |
||||||||||||
|
Other |
76,134 |
62,679 |
13,455 |
21.5 |
||||||||||||
|
Total noninterest income |
$ |
682,681 |
$ |
591,681 |
$ |
91,000 |
15.4 |
% |
||||||||
Noninterest income increased by $29.1 million, or 14.3%, during the three-month period ended September 30, 2026, and increased $91.0 million, or 15.4%, during the nine-month period ended September 30, 2026, compared to the same periods in 2025. Table 4 above summarizes the components of noninterest income and the respective year-over-year comparison for each category.
Trust and securities processing income consists of fees earned on personal and corporate trust accounts, custody of securities services, trust investments and wealth management services, mutual fund assets, and alternative asset servicing. The increase in these fees for the three and nine-month periods ended September 30, 2026, compared to the same periods in 2025, was primarily due to an increase in fund services revenue, corporate trust revenue, and trust services revenue. For the three-month period ended September 30, 2026, fund services revenue increased $12.0 million, or 25.5%, corporate trust revenue increased $2.9 million, or 15.0%, and trust services income increased $1.2 million, or 5.5%, compared to the same period in 2025. For the nine-month period ended September 30, 2026, fund services revenue increased $30.0 million, or 22.1%, corporate trust revenue increased $10.2 million, or 18.6%, and trust services revenue increased $5.8 million, or 9.6%, compared to the same period in 2025. The recent volatile markets have impacted the income in this category. Since trust and securities processing fees are primarily asset-based, which are highly correlated to the change in market value of the assets, the related income for the remainder of the year will be affected by changes in the securities markets. Management continues to emphasize sales of services to both new and existing clients as well as increasing and improving the distribution channels.
Service charges on deposit accounts for the three-month period ended September 30, 2026 increased $2.3 million, or 7.9%, and increased $5.1 million, or 5.9%, for the nine-month period ended September 30, 2026, compared to the same periods in 2025. The changes in the three-month and nine-month periods were driven by corporate service charges.
Brokerage fees for the three-month period ended September 30, 2026 increased $3.7 million, or 18.1%, and increased $11.6 million, or 19.6%, for the nine-month period ended September 30, 2026, compared to the same periods in 2025. The changes in the three-month and nine-month periods were driven by increased 12b-1 fees and money market share revenue.
Investment securities gains, net for the three and nine-month periods ended September 30, 2026 increased $15.1 million, or 369.0%, and increased $12.3 million, or 42.8%, respectively, compared to the same periods in 2025. The increase for the three-month period ended September 30, 2026, was primarily driven by increases of $7.2 million in valuation of the Company's securities without readily determinable fair value, as well as $7.1 million in net losses on the Company's securities with readily determinable fair value during the third quarter of 2025. The increase for the nine-month period ended September 30, 2026 was driven by a $17.9 million gain on the sale of a security without readily determinable fair value and increases of $16.4 million in valuation of the Company's securities without readily determinable fair value, both during 2026, offset by $20.9 million in net gains on the Company's investment in Voyager Technologies, Inc. in 2025, which completed its initial public offering in June 2025. The income in this category is highly correlated to the change in market value of the assets, and the related income for the remainder of the year will be affected by changes in the securities markets. The Company's investment portfolio is continually evaluated for opportunities to improve its performance and risk profile relative to market conditions and the Company's interest rate expectations. This can result in differences from quarter to quarter in the amount of realized gains or losses on this portfolio.
Other noninterest income for the three-month period ended September 30, 2026, decreased $6.1 million, or 18.6%, compared to the same period in 2025, primarily driven by a $5.5 million decrease in company-owned life insurance income and a $2.0 million decrease in bank-owned life insurance income, partially offset by an increase of $1.3 million in syndication income. For the nine-month period, other noninterest income increased $13.5 million, or 21.5%, compared to the same period in 2025. This increase is driven by increases of $3.1 million in syndication income, $2.7 million in derivative income, $2.2 million in bank-owned life insurance income, and $2.1 million in company-owned life insurance income.
Table 5
SUMMARY OF NONINTEREST EXPENSE (unaudited, dollars in thousands)
|
Three Months Ended |
Dollar |
Percent |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2026 |
2025 |
26-25 |
26-25 |
|||||||||||||
|
Salaries and employee benefits |
$ |
221,240 |
$ |
220,329 |
$ |
911 |
0.4 |
% |
||||||||
|
Occupancy, net |
21,210 |
19,149 |
2,061 |
10.8 |
||||||||||||
|
Equipment |
14,052 |
16,563 |
(2,511 |
) |
(15.2 |
) |
||||||||||
|
Supplies and services |
7,685 |
10,492 |
(2,807 |
) |
(26.8 |
) |
||||||||||
|
Marketing and business development |
15,286 |
11,094 |
4,192 |
37.8 |
||||||||||||
|
Processing fees |
44,256 |
45,008 |
(752 |
) |
(1.7 |
) |
||||||||||
|
Legal and consulting |
14,882 |
21,616 |
(6,734 |
) |
(31.2 |
) |
||||||||||
|
Bankcard |
11,426 |
11,775 |
(349 |
) |
(3.0 |
) |
||||||||||
|
Amortization of other intangible assets |
23,243 |
25,317 |
(2,074 |
) |
(8.2 |
) |
||||||||||
|
Regulatory fees |
8,918 |
8,091 |
827 |
10.2 |
||||||||||||
|
Other |
17,259 |
29,851 |
(12,592 |
) |
(42.2 |
) |
||||||||||
|
Total noninterest expense |
$ |
399,457 |
$ |
419,285 |
$ |
(19,828 |
) |
(4.7 |
)% |
|||||||
|
Nine Months Ended |
Dollar |
Percent |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2026 |
2025 |
26-25 |
26-25 |
|||||||||||||
|
Salaries and employee benefits |
$ |
668,083 |
$ |
655,278 |
$ |
12,805 |
2.0 |
% |
||||||||
|
Occupancy, net |
59,562 |
53,789 |
5,773 |
10.7 |
||||||||||||
|
Equipment |
41,314 |
49,937 |
(8,623 |
) |
(17.3 |
) |
||||||||||
|
Supplies and services |
18,793 |
21,660 |
(2,867 |
) |
(13.2 |
) |
||||||||||
|
Marketing and business development |
42,994 |
30,436 |
12,558 |
41.3 |
||||||||||||
|
Processing fees |
129,388 |
129,496 |
(108 |
) |
(0.1 |
) |
||||||||||
|
Legal and consulting |
38,384 |
68,690 |
(30,306 |
) |
(44.1 |
) |
||||||||||
|
Bankcard |
35,140 |
36,933 |
(1,793 |
) |
(4.9 |
) |
||||||||||
|
Amortization of other intangible assets |
70,163 |
68,067 |
2,096 |
3.1 |
||||||||||||
|
Regulatory fees |
26,285 |
25,587 |
698 |
2.7 |
||||||||||||
|
Other |
49,867 |
57,367 |
(7,500 |
) |
(13.1 |
) |
||||||||||
|
Total noninterest expense |
$ |
1,179,973 |
$ |
1,197,240 |
$ |
(17,267 |
) |
(1.4 |
)% |
|||||||
Noninterest expense decreased $19.8 million, or 4.7%, and decreased $17.3 million, or 1.4%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025. Table 5 above summarizes the components of noninterest expense and the respective year-over-year comparison for each category. For the first nine months of 2026, noninterest expense included $6.1 million in total acquisition-related and other nonrecurring costs, compared to $102.3 million in the same period in 2025.
Salaries and employee benefits increased by $0.9 million, or 0.4%, and increased $12.8 million, or 2.0%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025. Salaries and wages expense increased $3.0 million, or 2.4%, and increased $17.5 million, or 4.8%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025. The increases in salaries and wages are due to higher employee salaries. Bonus and commission expense increased $2.8 million, or 5.3%, and decreased $18.4 million, or 10.2%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025. The increase in bonus and commission expense for the three-month period is due to higher company performance, while the decrease for the nine-month period is primarily related to severance, retention bonuses, and change in control payments made to HTLF associates in 2025. Employee benefits expense decreased $4.9 million, or 12.5%, and increased $13.7 million, or 12.4%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025. The decrease in employee benefits for the three-month period is primarily driven by a decrease in deferred compensation expense, while the increase for the nine-month period is due to higher medical insurance expense.
Occupancy expense increased $2.1 million, or 10.8%, and $5.8 million, or 10.7%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025, primarily due to increased depreciation expense related to assets acquired from the HTLF acquisition and increased building repair expense.
Equipment expense decreased $2.5 million, or 15.2%, and $8.6 million, or 17.3%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025, primarily due to lower software maintenance and amortization expense.
Supplies and services expense decreased $2.8 million, or 26.8%, and $2.9 million, or 13.2%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025, primarily due to printing and mailing of conversion notices to legacy HTLF customers during the third quarter of 2025.
Marketing and business development expense increased $4.2 million, or 37.8%, and $12.6 million, or 41.3%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025, primarily due to the timing of various advertising campaigns and increased travel and entertainment expense.
Legal and consulting expense decreased $6.7 million, or 31.2%, and $30.3 million, or 44.1%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025. The decrease in both periods is primarily due to decreases in non-recurring transaction costs associated with the HTLF acquisition in 2025.
Amortization of other intangible assets decreased $2.1 million, or 8.2%, and increased $2.1 million, or 3.1%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025. The decrease in the three-month period ended September 30, 2026 is primarily due to a decrease of amortization related to the core deposit intangible recognized from the HTLF acquisition. The increase in the nine-month period ended September 30, 2026 is related to the timing of the HTLF acquisition in the first quarter of 2025.
Other expense decreased $12.6 million, or 42.2%, and $7.5 million, or 13.1%, for the three and nine-month periods ended September 30, 2026, respectively, compared to the same periods in 2025. The decrease in both periods is primarily due to decreases in non-recurring transaction costs associated with the HTLF acquisition in 2025.
Income Tax Expense
The Company's effective tax rate was 20.2% for the nine months ended September 30, 2026, compared to 19.4% for the same period in 2025. The increase in the effective tax rate in 2026 is mainly due to more favorable discrete tax items in 2025, including a benefit from remeasuring deferred tax assets after the HTLF acquisition increased the state marginal tax rate. Additionally, a smaller proportion of pre-tax income in 2026 was earned from tax-exempt municipal securities.
Strategic Lines of Business
The Company has strategically aligned its operations into the following three reportable Business Segments: Commercial Banking, Institutional Banking, and Personal Banking. The Company's senior executive officers regularly evaluate Business Segment financial results produced by the Company's internal reporting system in deciding how to allocate resources and assess performance for individual Business Segments. For comparability purposes, amounts in all periods are based on methodologies in effect at September 30, 2026. Previously reported results have been reclassified in this Form 10-Q to conform to the Company's current organizational structure.
Table 6
Commercial Banking Operating Results (unaudited, dollars in thousands)
|
Three Months Ended |
Dollar |
Percent |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2026 |
2025 |
26-25 |
26-25 |
|||||||||||||
|
Net interest income |
$ |
375,919 |
$ |
331,555 |
$ |
44,364 |
13.4 |
% |
||||||||
|
Provision for credit losses |
27,946 |
19,465 |
8,481 |
43.6 |
||||||||||||
|
Noninterest income |
51,395 |
56,089 |
(4,694 |
) |
(8.4 |
) |
||||||||||
|
Noninterest expense |
170,606 |
187,031 |
(16,425 |
) |
(8.8 |
) |
||||||||||
|
Income before taxes |
228,762 |
181,148 |
47,614 |
26.3 |
||||||||||||
|
Income tax expense |
42,715 |
36,940 |
5,775 |
15.6 |
||||||||||||
|
Net income |
$ |
186,047 |
$ |
144,208 |
$ |
41,839 |
29.0 |
% |
||||||||
|
Nine Months Ended |
Dollar |
Percent |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2026 |
2025 |
26-25 |
26-25 |
|||||||||||||
|
Net interest income |
$ |
1,103,836 |
$ |
928,091 |
$ |
175,745 |
18.9 |
% |
||||||||
|
Provision for credit losses |
76,456 |
104,550 |
(28,094 |
) |
(26.9 |
) |
||||||||||
|
Noninterest income |
149,623 |
136,527 |
13,096 |
9.6 |
||||||||||||
|
Noninterest expense |
505,311 |
530,691 |
(25,380 |
) |
(4.8 |
) |
||||||||||
|
Income before taxes |
671,692 |
429,377 |
242,315 |
56.4 |
||||||||||||
|
Income tax expense |
135,513 |
83,513 |
52,000 |
62.3 |
||||||||||||
|
Net income |
$ |
536,179 |
$ |
345,864 |
$ |
190,315 |
55.0 |
% |
||||||||
For the nine-month period ended September 30, 2026, Commercial Banking net income increased $190.3 million, or 55.0%, to $536.2 million, compared to the same period in 2025. Net interest income increased $175.7 million, or 18.9%, for the nine-month period ended September 30, 2026, compared to the same period in 2025, primarily driven by organic loan growth, an additional month of activity from the acquisition of HTLF, and earning asset mix changes. Provision for credit losses decreased $28.1 million for the period, driven by the acquisition of HTLF as well as portfolio metric changes and ongoing recalibrations of economic loss models in 2026 as compared to 2025. Noninterest income increased $13.1 million, or 9.6%, compared to the same period in 2025, primarily due to increases of $6.6 million in other income driven by increased syndication income, derivative income, and life insurance income, coupled with increases of $3.6 million in deposit service charges and $2.4 million in bankcard fees. Noninterest expense decreased $25.4 million, or 4.8%, to $505.3 million for the nine-month period ended September 30, 2026, compared to the same period in 2025. This decrease was driven by a decrease of $42.6 million in technology, service, and overhead expenses, partially offset by increases of $5.8 million in marketing and business development, $5.8 million in other noninterest expense driven by operational losses and expense on other real estate owned, and $5.3 million in salaries and employee benefits.
Table 7
Institutional Banking Operating Results (unaudited, dollars in thousands)
|
Three Months Ended |
Dollar |
Percent |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2026 |
2025 |
26-25 |
26-25 |
|||||||||||||
|
Net interest income |
$ |
73,716 |
$ |
60,997 |
$ |
12,719 |
20.9 |
% |
||||||||
|
Provision for credit losses |
575 |
460 |
115 |
25.0 |
||||||||||||
|
Noninterest income |
133,279 |
115,379 |
17,900 |
15.5 |
||||||||||||
|
Noninterest expense |
122,672 |
110,613 |
12,059 |
10.9 |
||||||||||||
|
Income before taxes |
83,748 |
65,303 |
18,445 |
28.2 |
||||||||||||
|
Income tax expense |
15,637 |
13,317 |
2,320 |
17.4 |
||||||||||||
|
Net income |
$ |
68,111 |
$ |
51,986 |
$ |
16,125 |
31.0 |
% |
||||||||
|
Nine Months Ended |
Dollar |
Percent |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2026 |
2025 |
26-25 |
26-25 |
|||||||||||||
|
Net interest income |
$ |
230,053 |
$ |
188,487 |
$ |
41,566 |
22.1 |
% |
||||||||
|
Provision for credit losses |
1,700 |
1,325 |
375 |
28.3 |
||||||||||||
|
Noninterest income |
384,298 |
327,171 |
57,127 |
17.5 |
||||||||||||
|
Noninterest expense |
358,130 |
323,015 |
35,115 |
10.9 |
||||||||||||
|
Income before taxes |
254,521 |
191,318 |
63,203 |
33.0 |
||||||||||||
|
Income tax expense |
51,349 |
37,211 |
14,138 |
38.0 |
||||||||||||
|
Net income |
$ |
203,172 |
$ |
154,107 |
$ |
49,065 |
31.8 |
% |
||||||||
For the nine-month period ended September 30, 2026, Institutional Banking net income increased $49.1 million, or 31.8%, to $203.2 million, compared to the same period in 2025. Net interest income increased $41.6
million, or 22.1%, compared to the same period in 2025, due to an increase in funds transfer pricing resulting from higher deposit balances. Provision for credit losses increased $0.4 million for the period, driven by portfolio metric changes and ongoing recalibrations of economic loss models in 2026 compared to 2025. Noninterest income increased $57.1 million, or 17.5%, to $384.3 million for the nine-month period ended September 30, 2026, compared to the same period in 2025. This increase was due to increases of $40.3 million in trust and securities processing income driven by higher fund services and corporate trust revenue, $12.1 million in brokerage income due to increased 12b-1 and money market revenue, $3.2 million in other income due to increased foreign currency valuation changes and reverse repurchase commitment fees, and $1.4 million in bankcard fees. Noninterest expense increased $35.1 million, or 10.9%, primarily driven by increases of $15.6 million in salaries and employee benefits expense, $11.9 million in technology, service, and overhead expense, $2.8 million in processing fees driven by software subscription fees, $1.7 million in marketing and business development, $1.4 million in legal and consulting expense, and $1.3 million in other noninterest expense driven by operational losses.
Table 8
Personal Banking Operating Results (unaudited, dollars in thousands)
|
Three Months Ended |
Dollar |
Percent |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2026 |
2025 |
26-25 |
26-25 |
|||||||||||||
|
Net interest income |
$ |
90,370 |
$ |
82,490 |
$ |
7,880 |
9.6 |
% |
||||||||
|
Provision for credit losses |
2,479 |
2,575 |
(96 |
) |
(3.7 |
) |
||||||||||
|
Noninterest income |
47,709 |
31,830 |
15,879 |
49.9 |
||||||||||||
|
Noninterest expense |
106,179 |
121,641 |
(15,462 |
) |
(12.7 |
) |
||||||||||
|
Income (loss) before taxes |
29,421 |
(9,896 |
) |
39,317 |
397.3 |
|||||||||||
|
Income tax expense (benefit) |
5,494 |
(2,018 |
) |
7,512 |
372.2 |
|||||||||||
|
Net income (loss) |
$ |
23,927 |
$ |
(7,878 |
) |
$ |
31,805 |
403.7 |
% |
|||||||
|
Nine Months Ended |
Dollar |
Percent |
||||||||||||||
|
September 30, |
Change |
Change |
||||||||||||||
|
2026 |
2025 |
26-25 |
26-25 |
|||||||||||||
|
Net interest income |
$ |
273,007 |
$ |
223,127 |
$ |
49,880 |
22.4 |
% |
||||||||
|
Provision for credit losses |
7,844 |
23,625 |
(15,781 |
) |
(66.8 |
) |
||||||||||
|
Noninterest income |
148,760 |
127,983 |
20,777 |
16.2 |
||||||||||||
|
Noninterest expense |
316,532 |
343,534 |
(27,002 |
) |
(7.9 |
) |
||||||||||
|
Income (loss) before taxes |
97,391 |
(16,049 |
) |
113,440 |
706.8 |
|||||||||||
|
Income tax expense (benefit) |
19,649 |
(3,121 |
) |
22,770 |
729.6 |
|||||||||||
|
Net income (loss) |
$ |
77,742 |
$ |
(12,928 |
) |
$ |
90,670 |
701.3 |
% |
|||||||
For the nine-month period ended September 30, 2026, Personal Banking net income improved $90.7 million, or 701.3%, to net income of $77.7 million, as compared to a net loss of $12.9 million in the same period in 2025. Net interest income increased $49.9 million, or 22.4%, compared to the same period in 2025 driven by organic loan growth, an additional month of activity from the acquisition of HTLF, and earning asset mix changes. Provision for credit losses decreased $15.8 million for the period, driven by the acquisition of HTLF as well as by portfolio metric changes and ongoing recalibrations of economic loss models in 2026 as compared to 2025. Noninterest income increased $20.8 million, or 16.2%, for the same period, primarily driven by increases of $14.5 million in investment securities gains, $5.1 million in trust and securities processing income, and $0.6 million in other income driven by increased life insurance income. Noninterest expense decreased $27.0 million, or 7.9%, primarily due to decreases of $26.6 million in technology, service, and overhead expenses, $2.4 million in bankcard expenses, $2.2 million in other noninterest expense driven by reduced charitable contributions, and $2.1 million in supplies and services expenses, partially offset by increases of $4.2 million in marketing and business development and $2.5 million in salaries and employee benefits expense.
Balance Sheet Analysis
Total assets of the Company decreased $356.0 million, or 0.5%, as of September 30, 2026, compared to December 31, 2025, primarily due to decreases of $2.6 billion, or 38.1%, and $239.9 million, or 25.2%, in interest-bearing due from banks and cash and due from banks, respectively, coupled with decreases of $700.8 million, or 5.1%, in securities available for sale and $596.9 million, or 38.6%, in securities purchased under agreements to resell. These decreases were partially offset by an increase of $3.8 billion, or 9.7%, in loan balances.
Total assets of the Company increased $856.9 million, or 1.2%, as of September 30, 2026, compared to September 30, 2025, primarily due to increases of $4.8 billion, or 12.8%, in loan balances and $186.1 million, or 24.3%, in securities purchased under agreements to resell, partially offset by decreases of $3.6 billion, or 45.6%, in interest-bearing due from banks, $370.0 million, or 2.8%, in securities available for sale, and $360.3 million, or 33.6%, in cash and due from banks balances.
Table 9
SELECTED FINANCIAL INFORMATION (unaudited, dollars in thousands)
|
September 30, |
December 31, |
|||||||||||
|
2026 |
2025 |
2025 |
||||||||||
|
Total assets |
$ |
72,738,046 |
$ |
71,881,181 |
$ |
73,094,090 |
||||||
|
Loans, net of unearned interest |
42,533,399 |
37,709,677 |
38,781,438 |
|||||||||
|
Total securities |
19,514,688 |
19,787,898 |
20,131,999 |
|||||||||
|
Interest-bearing due from banks |
4,296,685 |
7,892,392 |
6,940,535 |
|||||||||
|
Total earning assets |
67,298,622 |
66,155,080 |
67,402,065 |
|||||||||
|
Total deposits |
60,169,345 |
60,135,843 |
60,656,790 |
|||||||||
|
Total borrowed funds |
3,570,422 |
3,309,928 |
3,799,167 |
|||||||||
Loans represent the Company's largest source of interest income. In addition to growing the commercial loan portfolio, management believes its middle market commercial business and its consumer business, including home equity and credit card loan products, are the market niches that represent its best opportunity to cross-sell fee-related services and generate additional noninterest income for the Company.
Actual loan balances totaled $42.5 billion as of September 30, 2026, and increased $3.8 billion, or 9.7%, compared to December 31, 2025, and increased $4.8 billion, or 12.8%, compared to September 30, 2025. Compared to December 31, 2025, commercial and industrial loans increased $3.0 billion, or 18.3%, leases and other loans increased $228.2 million, or 95.7%, specialty lending increased $211.6 million, or 40.8%, and commercial real estate loans increased $210.8 million, or 1.3%. Compared to September 30, 2025, commercial and industrial loans increased $4.1 billion, or 26.7%, leases and other loans increased $358.5 million, or 331.6%, and consumer real estate loans increased $198.9 million, or 4.6%.
As of September 30, 2026 and December 31, 2025, commercial real estate loans comprised approximately 39.0% and 42.2%, respectively, of the Company's loan portfolio. Commercial real estate loans generally involve a greater degree of credit risk than consumer real estate loans because they typically have larger balances and are more affected by adverse conditions in the economy. Because payments on loans secured by commercial real estate often depend upon the successful operation and management of the properties and the businesses which operate from within them, repayment of such loans may be affected by factors outside the borrower's control, such as adverse conditions in the real estate market or the economy or changes in government regulations. In recent years, commercial real estate markets have been particularly impacted by the economic disruption and the evolution of various remote work options, which could impact the long-term performance of some types of office properties within our commercial real estate portfolio. Due to these risks, the Company is actively monitoring its exposure to commercial real estate.
Generally, these loans are made for investment and real estate development or working capital and business expansion purposes and are primarily secured by real estate with a maximum loan-to-value of 80%. Most of these properties are non-owner occupied and have guarantees as additional security. The Company's investment CRE portfolio (which includes non-owner occupied and construction loans) totaled 24.7% and 27.5% of total Company
loans as of September 30, 2026 and December 31, 2025, respectively. The average investment CRE loan was approximately $4.0 million and $3.6 million, as of September 30, 2026 and December 31, 2025, respectively.
The properties securing the commercial real estate portfolio are diverse in terms of type and geographic location. This diversity helps reduce exposure to adverse economic events that affect any single market or industry. Notwithstanding, commercial real estate loans, in general, may be more adversely impacted by conditions in the real estate market or the economy.
The following table presents the Company's investment CRE (which includes non-owner occupied and construction loans) by industry. The table separately discloses the top five industries as a percentage of the Company's loan portfolio as of either period presented, while the remainder are included in "Other."
Table 10
|
Investment CRE loans by industry as a percentage of total Company Loans |
||||||||
|
September 30, 2026 |
December 31, 2025 |
|||||||
|
Industrial |
7.0 |
% |
8.1 |
% |
||||
|
Multifamily |
6.6 |
6.7 |
||||||
|
Office building |
2.8 |
3.6 |
||||||
|
Retail |
2.1 |
2.3 |
||||||
|
Hotel |
1.9 |
2.0 |
||||||
|
Other |
4.3 |
4.8 |
||||||
|
Total Investment CRE |
24.7 |
% |
27.5 |
% |
||||
The following table presents the Company's investment CRE (which includes non-owner occupied and construction loans) by state. The table separately discloses all states that represent at least 5.0% of the Company's investment CRE portfolio as of either period presented, while the remainder are included in "All Others."
Table 11
|
Investment CRE loans by State |
||||||||
|
September 30, 2026 |
December 31, 2025 |
|||||||
|
Colorado |
12.9 |
% |
11.7 |
% |
||||
|
Arizona |
12.5 |
12.2 |
||||||
|
Texas |
12.0 |
12.0 |
||||||
|
Missouri |
12.0 |
12.5 |
||||||
|
Utah |
5.4 |
4.9 |
||||||
|
California |
5.2 |
5.1 |
||||||
|
All others |
40.0 |
41.6 |
||||||
|
Total Investment CRE |
100.0 |
% |
100.0 |
% |
||||
Nonaccrual, past due and restructured loans are discussed under "Credit Risk Management" within "Item 3. Quantitative and Qualitative Disclosures About Market Risk" in this report.
Investment Securities
The Company's investment portfolio contains trading, AFS, and HTM securities, as well as FRB stock, FHLB stock, and other miscellaneous investments. Investment securities totaled $19.5 billion as of September 30, 2026, $20.1 billion as of December 31, 2025, and $19.8 billion as of September 30, 2025, and comprised 29.0%, 29.9%, and 29.9% of the Company's earning assets, respectively, as of those dates.
The Company's AFS securities portfolio comprised 66.7% of the Company's total securities portfolio at September 30, 2026 , 68.1% at December 31, 2025, and 67.6% at September 30, 2025. The Company's AFS securities portfolio provides liquidity as a result of the composition and average life of the underlying securities.
This liquidity can be used to fund loan growth or to offset the outflow of traditional funding sources. The average life of the AFS securities portfolio was 70.3 months at September 30, 2026, compared to 74.8 months at December 31, 2025, and 78.3 months at September 30, 2025. In addition to providing a potential source of liquidity, the AFS securities portfolio can be used as a tool to manage interest rate sensitivity. The Company's goal in the management of its AFS securities portfolio is to maximize return within the Company's parameters of liquidity goals, interest rate risk, and credit risk.
Management expects collateral pledging requirements for public funds, loan demand, and deposit funding to be the primary factors impacting changes in the level of AFS securities. There were $12.3 billion and $13.4 billion of securities pledged to secure U.S. Government deposits, other public deposits, certain trust deposits, derivative transactions, and repurchase agreements at September 30, 2026 and December 31, 2025, respectively.
The Company's HTM securities portfolio consists of U.S. Treasury securities, mortgage-backed securities, general obligation bonds, and private placement bonds. The HTM portfolio, net of the ACL, totaled $5.7 billion at each September 30, 2026, December 31, 2025, and September 30, 2025. The average life of the HTM portfolio was 8.6 years at September 30, 2026, compared to 8.5 years at December 31, 2025, and 8.6 years at September 30, 2025.
The securities portfolio generates the Company's second largest component of interest income. The securities portfolio achieved an average yield on a tax-equivalent basis of 3.85% for the nine-month period ended September 30, 2026, compared to 3.66% for the same period in 2025.
At September 30, 2026, the unrealized pre-tax net loss on the AFS securities portfolio was $953.1 million, or 6.8% of the $14.0 billion amortized cost value, compared to $290.8 million at December 31, 2025. At September 30, 2026, the unrealized pre-tax net loss on the securities designated as HTM was $806.2 million, or 14.1% of the $5.7 billion amortized cost value, compared to $473.8 million at December 31, 2025. During 2022, the Company transferred securities with an amortized cost balance of $4.1 billion and a fair value of $3.8 billion from the AFS category to the HTM category. The transfer of securities was made at fair value at the time of transfer. The remaining balance of unrealized pre-tax losses related to transferred securities was $117.5 million as of September 30, 2026, and $139.2 million as of December 31, 2025, and was included in the amortized cost balance of HTM securities. See further information in Note 5, "Securities" in the Notes to Consolidated Financial Statements.
Deposits and Borrowed Funds
Deposits decreased $487.4 million, or 0.8%, from December 31, 2025 to September 30, 2026 and increased $33.5 million, or 0.1%, from September 30, 2025 to September 30, 2026. Total interest-bearing balances increased $2.1 billion and noninterest-bearing deposits decreased $2.6 billion from December 31, 2025 to September 30, 2026. Total interest-bearing deposits increased $1.6 billion and noninterest-bearing deposits decreased $1.6 billion from September 30, 2025 to September 30, 2026. Noninterest-bearing deposits were 24.2%, 28.3%, and 26.9% of total deposits at September 30, 2026, December 31, 2025, and September 30, 2025, respectively.
Deposits represent the Company's primary funding source for its asset base. In addition to the core deposits garnered by the Company's retail branch structure, the Company continues to focus on its cash management services, as well as its trust and investment company servicing businesses, in order to attract and retain additional deposits. Management believes a strong core deposit composition is one of the Company's key strengths given its competitive product mix.
As of September 30, 2026, there were an estimated $39.2 billion of uninsured deposits, a decrease of $450.3 million as compared to December 31, 2025, and a decrease of $754.1 million as compared to September 30, 2025. Estimated uninsured deposits comprised approximately 65.2%, 65.4%, and 66.5% of total deposits as of September 30, 2026, December 31, 2025, and September 30, 2025, respectively. A portion of these uninsured deposits represent affiliate deposits and collateralized deposits. Affiliate deposits represent deposit accounts owned by the wholly owned subsidiaries of UMB Financial Corporation that are on deposit at UMB Bank, n.a. Collateralized deposits are public fund deposits or corporate trust deposits that are collateralized by high quality securities within the investment portfolio. Excluding affiliate deposits of $3.3 billion and collateralized deposits of $5.7 billion, the adjusted estimated uninsured deposits were $30.3 billion as of September 30, 2026. The adjusted ratio of estimated uninsured deposits, excluding affiliate and collateralized deposits, as a percentage of total deposits
was approximately 50.3% as of September 30, 2026, 48.1% as of December 31, 2025, and 52.7% as of September 30, 2025.
The Company participates in the IntraFi Cash Service program, which allows its customers to place deposits into the program to receive reciprocal FDIC insurance coverage. The Company had $4.4 billion, $3.5 billion, and $3.4 billion of deposits in the program as of September 30, 2026, December 31, 2025, and September 30, 2025, respectively.
Long-term debt totaled $333.1 million as of September 30, 2026, compared to $474.2 million as of December 31, 2025, and $471.3 million as of September 30, 2025.
In September 2022, the Company issued $110.0 million in aggregate subordinated notes due in September 2032. The Company received $107.9 million, after deducting underwriting discounts and commissions and offering expenses, and used the proceeds from the offering for general corporate purposes, including, among other uses, contributing Tier 1 capital into the Bank. The subordinated notes were issued with a fixed-to-fixed rate of 6.25% and an effective rate of 6.64%, due to issuance costs, with an interest rate reset date of September 2027.
As part of the acquisition of HTLF, the Company acquired $150.0 million in aggregate subordinated notes due in September 2031. The subordinated notes had a fixed interest rate of 2.75% until September 2026. The subordinated notes had an acquired fair value of $138.8 million as of January 31, 2025. During the third quarter of 2026, the Company redeemed all of these outstanding subordinated notes.
The remainder of the Company's long-term debt was assumed from the acquisitions of Marquette Financial Companies in 2015 and HTLF in 2025 and consists of debt obligations payable to 19 unconsolidated trusts that previously issued trust preferred securities. These long-term debt obligations have an aggregate contractual balance of $262.9 million and a carrying value of $223.5 million as of September 30, 2026 and $220.0 million at December 31, 2025. Interest rates on trust preferred securities are tied to the three-month term SOFR rate with spreads ranging from 133 basis points to 365 basis points and reset quarterly. The trust preferred securities have maturity dates ranging from September 2032 to September 2037.
Federal funds purchased and securities sold under agreements to repurchase totaled $3.2 billion as of September 30, 2026, $3.3 billion at December 31, 2025, and $2.8 billion at September 30, 2025. Repurchase agreements are transactions involving the exchange of investment funds by the customer for securities by the Company under an agreement to repurchase the same or similar issues at an agreed-upon price and date.
Capital and Liquidity
The Company places a significant emphasis on the maintenance of a strong capital position, which promotes investor confidence, provides access to funding sources under favorable terms, and enhances the Company's ability to capitalize on business growth and acquisition opportunities. Higher levels of liquidity, however, bear corresponding costs, measured in terms of lower yields on short-term, more liquid earning assets and higher expenses for extended liability maturities. The Company manages capital for each subsidiary based upon the subsidiary's respective risks and growth opportunities as well as regulatory requirements.
Total shareholders' equity was $7.9 billion at September 30, 2026, a $159.3 million increase as compared to December 31, 2025, and a $408.9 million increase compared to September 30, 2025. Total common shareholders' equity was $7.6 billion as of September 30, 2026, compared to $7.4 billion at December 31, 2025 and $7.2 billion at September 30, 2025. Total accumulated other comprehensive loss was $793.2 million at September 30, 2026. This is a decline of $531.7 million as compared to December 31, 2025, and a decline of $468.4 million as compared to September 30, 2025.
At its April 28, 2026 meeting, the Company's Board of Directors authorized the repurchase of up to two million shares of the Company's common stock during the twelve months following the meeting (a Repurchase Authorization). On April 29, 2025 and April 30, 2024, the Board authorized the repurchase of up to one million shares of the Company's common stock during the twelve months following each meeting. During the nine-month period ended September 30, 2026, the Company repurchased 178,429 common shares pursuant to the 2025 Repurchase Authorization and 38,158 common shares pursuant to the 2026 Repurchase Authorization. The
Company also acquired common shares pursuant to its share-based incentive programs. During the nine-month period ended September 30, 2025, the Company did not repurchase shares of common stock pursuant to any of its announced Repurchase Authorizations, but did acquire shares pursuant to its share-based incentive programs.
At the Company's quarterly board meeting, the Board of Directors declared a $0.50 per common share quarterly cash dividend payable on January 4, 2027, to common shareholders of record at the close of business on December 10, 2026. Additionally, the Board of Directors declared a dividend of $193.75 per share of the Company's Series B Preferred Stock, which results in a dividend of $0.484375 per depositary share. The Series B Preferred Stock dividend is payable on January 15, 2027 to stockholders of record of the Series B Preferred Stock as of the close of business on December 31, 2026.
The Company is a member bank of the FHLB and through this relationship, the Company owns FHLB stock and has access to additional liquidity and funding sources through FHLB advances. The Company's borrowing capacity is dependent upon the amount of collateral the Company places at the FHLB. As of September 30, 2026 and December 31, 2025, the Company owned $10.1 million and $10.3 million, respectively, of FHLB stock. As of September 30, 2026, the Company had three letters of credit outstanding with the FHLB of Des Moines to secure deposits. These letters of credit have an aggregate amount of $53.0 million and have various maturity dates through December 10, 2026. The Company's remaining borrowing capacity with the FHLB was $2.7 billion as of September 30, 2026. The Company had no outstanding FHLB advances with the FHLB of Des Moines as of September 30, 2026.
In addition to the borrowing capacity with the FHLB as described above, the Company had additional liquidity of $34.7 billion available via cash, unpledged bond collateral, the federal funds market, the Federal Reserve Discount Window, and the IntraFi Cash Service program as of September 30, 2026.
Risk-based capital guidelines established by regulatory agencies set minimum capital standards based on the level of risk associated with a financial institution's assets. The Company has implemented the Basel III regulatory capital rules adopted by the FRB. Basel III capital rules include a minimum ratio of Common Equity Tier 1 capital to risk-weighted assets of 4.5% and a minimum Tier 1 risk-based capital ratio of 6%. A financial institution's total capital is also required to equal at least 8% of risk-weighted assets.
The risk-based capital guidelines indicate the specific risk weightings by type of asset. Certain off-balance sheet items (such as standby letters of credit and binding loan commitments) are multiplied by credit conversion factors to translate them into balance sheet equivalents before assigning them specific risk weightings. The Company is also required to maintain a leverage ratio equal to or greater than 4%. The leverage ratio is calculated as the ratio of Tier 1 core capital to total average assets, less goodwill and intangibles.
The Company's capital position as of September 30, 2026 is summarized in the table below and exceeded regulatory requirements.
Table 12
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||
|
September 30, |
September 30, |
|||||||||||||||
|
RATIOS |
2026 |
2025 |
2026 |
2025 |
||||||||||||
|
Common Equity Tier 1 capital ratio |
11.50 |
% |
10.70 |
% |
11.50 |
% |
10.70 |
% |
||||||||
|
Tier 1 risk-based capital ratio |
12.04 |
11.30 |
12.04 |
11.30 |
||||||||||||
|
Total risk-based capital ratio |
13.52 |
13.11 |
13.52 |
13.11 |
||||||||||||
|
Leverage ratio |
9.41 |
8.33 |
9.41 |
8.33 |
||||||||||||
|
Return on average assets |
1.53 |
1.04 |
1.52 |
0.98 |
||||||||||||
|
Return on average common equity |
13.83 |
10.14 |
13.90 |
9.84 |
||||||||||||
|
Average common equity to assets |
11.03 |
10.30 |
10.90 |
9.90 |
||||||||||||
The Company's per common share data is summarized in the table below.
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||
|
September 30, |
September 30, |
|||||||||||||||
|
Per Share Data |
2026 |
2025 |
2026 |
2025 |
||||||||||||
|
Earnings per common share - basic |
$ |
3.58 |
$ |
2.38 |
$ |
10.52 |
$ |
6.57 |
||||||||
|
Earnings per common share - diluted |
3.56 |
2.36 |
10.46 |
6.53 |
||||||||||||
|
Cash dividends per common share |
0.50 |
0.40 |
1.36 |
1.20 |
||||||||||||
|
Dividend payout ratio |
14.0 |
% |
16.8 |
% |
12.9 |
% |
18.3 |
% |
||||||||
|
Book value per common share |
$ |
99.75 |
$ |
94.29 |
$ |
99.75 |
$ |
94.29 |
||||||||
Off-balance Sheet Arrangements
The Company's main off-balance sheet arrangements are loan commitments, commercial and standby letters of credit, futures contracts and forward exchange contracts, which have maturity dates rather than payment due dates. See Note 10, "Commitments, Contingencies and Guarantees" in the Notes to Consolidated Financial Statements for detailed information on these arrangements. The level of the outstanding commitments could be impacted by volatility in the economic markets and governmental responses to inflation, geopolitical tensions, and supply chain constraints. These changing conditions could have impacts on the consolidated balance sheets of the Company for the remainder of the year.
Critical Accounting Policies and Estimates
The preparation of these Consolidated Financial Statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates and judgments, including those related to customers and suppliers, allowance for credit losses, bad debts, investments, financing operations, long-lived assets, taxes, other contingencies, and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which have formed the basis for making such judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Under different assumptions or conditions, actual results may differ from the recorded estimates.
A summary of critical accounting policies is listed in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" section of the Form 10-K.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Risk Management
Market risk is a broad term for the risk of economic loss due to adverse changes in the fair value of a financial instrument. These changes may be the result of various factors, including interest rates, foreign exchange prices, commodity prices, or equity prices. Financial instruments that are subject to market risk can be classified either as held for trading or held for purposes other than trading.
The Company is subject to market risk primarily through the effect of changes in interest rates of its assets held for purposes other than trading. The following discussion of interest rate risk, however, combines instruments held for trading and instruments held for purposes other than trading because the instruments held for trading represent such a small portion of the Company's portfolio that the interest rate risk associated with them is immaterial.
Interest Rate Risk
In the banking industry, a major risk exposure is changing interest rates. To minimize the effects of interest rate changes on net interest income and exposure levels to economic losses, the Company manages its exposure to changes in interest rates through asset and liability management within guidelines established by its Asset Liability Committee (ALCO) and approved by the Board. The ALCO is responsible for approving and ensuring compliance with asset/liability management policies, including interest rate exposure. The Company's primary method for measuring and analyzing consolidated interest rate risk is the Net Interest Income Simulation Analysis. The Company also uses a Net Portfolio Value model to measure market value risk under various rate change scenarios and a gap analysis to measure maturity and repricing relationships between interest-earning assets and interest-bearing liabilities at specific points in time. On a limited basis, the Company uses hedges such as swaps, rate floors, floor spreads, and futures contracts to manage interest rate risk on certain loans, securities, and trust preferred securities. See further information in Note 11 "Derivatives and Hedging Activities" in the Notes to the Consolidated Financial Statements.
Overall, the Company manages interest rate risk by positioning the balance sheet to maximize net interest income while maintaining an acceptable level of interest rate and credit risk, remaining mindful of the relationship among profitability, liquidity, interest rate risk, and credit risk.
Net Interest Income Modeling
The Company's primary interest rate risk tool, the Net Interest Income Simulation Analysis, measures interest rate risk and the effect of interest rate changes on net interest income and net interest margin. This analysis incorporates all of the Company's assets and liabilities together with assumptions that reflect the current interest rate environment. Through these simulations, management estimates the impact on net interest income of a 200-basis-point upward or a 300-basis-point downward gradual change (e.g. ramp) and immediate change (e.g. shock) of market interest rates over a two year period. In ramp scenarios, rates change gradually for a one-year period and remain constant in year two. In shock scenarios, rates change immediately and the change is sustained for the remainder of the two-year scenario horizon. Assumptions are made to project rates for new loans and deposits based on historical analysis, management outlook and repricing strategies. Asset prepayments and other market risks are developed from industry estimates of prepayment speeds and other market changes. The results of these simulations can be significantly influenced by assumptions utilized and management evaluates the sensitivity of the simulation results on a regular basis.
Table 13 shows the net interest income increase or decrease over the next two years as of September 30, 2026 and 2025 based on hypothetical changes in interest rates and a constant sized balance sheet with runoff being replaced.
Table 13
MARKET RISK (unaudited)
|
Hypothetical change in interest rate - Rate Ramp |
||||||||||||||||
|
Year One |
Year Two |
|||||||||||||||
|
September 30, 2026 |
September 30, 2025 |
September 30, 2026 |
September 30, 2025 |
|||||||||||||
|
Change in basis points |
Percentage |
Percentage |
Percentage |
Percentage |
||||||||||||
|
200 |
(1.0 |
)% |
(1.0 |
)% |
3.8 |
% |
5.2 |
% |
||||||||
|
100 |
(0.7 |
) |
(0.8 |
) |
1.4 |
2.0 |
||||||||||
|
Static |
- |
- |
- |
- |
||||||||||||
|
(100) |
1.2 |
1.1 |
(0.8 |
) |
(1.7 |
) |
||||||||||
|
(200) |
2.6 |
2.4 |
(2.0 |
) |
(3.4 |
) |
||||||||||
|
(300) |
4.0 |
3.8 |
(3.0 |
) |
(5.4 |
) |
||||||||||
|
Hypothetical change in interest rate - Rate Shock |
||||||||||||||||
|
Year One |
Year Two |
|||||||||||||||
|
September 30, 2026 |
September 30, 2025 |
September 30, 2026 |
September 30, 2025 |
|||||||||||||
|
Change in basis points |
Percentage |
Percentage |
Percentage |
Percentage |
||||||||||||
|
200 |
1.1 |
% |
1.6 |
% |
5.0 |
% |
6.4 |
% |
||||||||
|
100 |
(0.0 |
) |
0.1 |
2.0 |
2.6 |
|||||||||||
|
Static |
- |
- |
- |
- |
||||||||||||
|
(100) |
0.9 |
0.2 |
(1.7 |
) |
(2.6 |
) |
||||||||||
|
(200) |
1.6 |
0.6 |
(3.9 |
) |
(5.5 |
) |
||||||||||
|
(300) |
2.8 |
0.9 |
(6.0 |
) |
(8.9 |
) |
||||||||||
The Company is positioned relatively neutral to changes in interest rates in the next year. In year one, net interest income is predicted to decrease in all upward rate scenarios, except for 200bps rate shock scenario. In down rate scenarios, net interest income is predicted to increase in all scenarios. In year two, net interest income is predicted to increase in rising rate scenarios and decrease in falling rate scenarios. The Company's ability to price deposits consistent with its historical approach is a key assumption in these scenarios.
Trading Account
The Company carries securities in a trading account that is maintained according to Board-approved policy and procedures. The policy limits the amount and type of securities that can be carried in the trading account, requires compliance with any limits under applicable law and regulations, and mandates the use of a value-at-risk methodology to manage price volatility risks within financial parameters. The risk associated with the carrying of trading securities is offset by utilizing financial instruments including exchange-traded financial futures as well as short sales of U.S. Treasury and Corporate securities. The trading securities and related hedging instruments are marked-to-market daily. The trading account had a balance of $49.8 million as of September 30, 2026, $22.3 million as of December 31, 2025, and $35.8 million as of September 30, 2025. Securities sold not yet purchased (i.e., short positions) totaled $17.5 million at September 30, 2026, $4.1 million as of December 31, 2025, and $13.0 million at September 30, 2025 and are classified within the Other liabilities line of the Company's Consolidated Balance Sheets.
The Company is subject to market risk primarily through the effect of changes in interest rates of its assets held for purposes other than trading. The discussion in Table 13 above of interest rate risk, however, combines instruments held for trading and instruments held for purposes other than trading, because the instruments held for trading represent such a small portion of the Company's portfolio that the interest rate risk associated with them is immaterial.
Other Market Risk
The Company has minimal foreign currency risk as a result of foreign exchange contracts. See Note 10 "Commitments, Contingencies and Guarantees" in the notes to the Consolidated Financial Statements.
Credit Risk Management
Credit risk represents the risk that a customer or counterparty may not perform in accordance with contractual terms. The Company utilizes a centralized credit administration function, which provides information on the Bank's risk levels, delinquencies, an internal ranking system and overall credit exposure. Loan requests are centrally reviewed to ensure the consistent application of the loan policy and standards. In addition, the Company has an internal loan review staff that operates independently of the Bank. This review team performs periodic examinations of the Bank's loans for credit quality, documentation and loan administration. The respective regulatory authorities governing the Bank also review loan portfolios.
A primary indicator of credit quality and risk management is the level of nonperforming loans. Nonperforming loans include both nonaccrual loans and restructured loans on nonaccrual. The Company's nonperforming loans decreased $14.1 million to $117.9 million at September 30, 2026, compared to September 30, 2025, and decreased $26.8 million compared to December 31, 2025.
The Company had $3.4 million, $4.8 million, and $4.6 million of other real estate owned as of September 30, 2026, December 31, 2025, and September 30, 2025, respectively. Other repossessed assets totaled $26.8 million as of September 30, 2025. Loans past due more than 90 days and still accruing interest totaled $15.6 million as of September 30, 2026, compared to $18.4 million as of December 31, 2025 and $6.1 million as of September 30, 2025.
A loan is generally placed on nonaccrual status when payments are past due 90 days or more and/or when management has considerable doubt about the borrower's ability to repay on the terms originally contracted. The accrual of interest is discontinued and recorded thereafter only when received in cash.
Certain loans are restructured to provide a reduction or deferral of interest or principal due to deterioration in the financial condition of the respective borrowers. The Company had $149 thousand of restructured loans at September 30, 2026, $177 thousand at September 30, 2025, and $169 thousand at December 31, 2025.
Table 14
LOAN QUALITY (unaudited, dollars in thousands)
|
September 30, |
December 31, |
|||||||||||
|
2026 |
2025 |
2025 |
||||||||||
|
Nonaccrual loans |
$ |
117,869 |
$ |
131,934 |
$ |
144,640 |
||||||
|
Restructured loans on nonaccrual |
16 |
31 |
26 |
|||||||||
|
Total nonperforming loans |
117,885 |
131,965 |
144,666 |
|||||||||
|
Other real estate owned |
3,391 |
4,649 |
4,800 |
|||||||||
|
Other repossessed assets |
- |
26,779 |
- |
|||||||||
|
Total nonperforming assets |
$ |
121,276 |
$ |
163,393 |
$ |
149,466 |
||||||
|
Loans past due 90 days or more |
$ |
15,648 |
$ |
6,131 |
$ |
18,403 |
||||||
|
Restructured loans accruing |
133 |
146 |
143 |
|||||||||
|
Allowance for credit losses on loans |
452,414 |
404,971 |
419,478 |
|||||||||
|
Ratios: |
||||||||||||
|
Nonperforming loans as a percent of loans |
0.28 |
% |
0.35 |
% |
0.37 |
% |
||||||
|
Nonperforming assets as a percent of loans plus other real estate owned |
0.29 |
0.43 |
0.39 |
|||||||||
|
Nonperforming assets as a percent of total assets |
0.17 |
0.23 |
0.20 |
|||||||||
|
Loans past due 90 days or more as a percent of loans |
0.04 |
0.02 |
0.05 |
|||||||||
|
Allowance for credit losses on loans as a percent of loans |
1.06 |
1.07 |
1.08 |
|||||||||
|
Allowance for credit losses on loans as a multiple of nonperforming loans |
3.84x |
3.07x |
2.90x |
|||||||||
Liquidity Risk
Liquidity represents the Company's ability to meet financial commitments through the maturity and sale of existing assets or availability of additional funds. The Company believes that the most important factor in the preservation of liquidity is maintaining public confidence that facilitates the retention and growth of a large, stable supply of core deposits and wholesale funds. Ultimately, the Company believes public confidence is generated through profitable operations, sound credit quality and a strong capital position. The primary source of liquidity for the Company is regularly scheduled payments on and maturity of assets, which include $13.0 billion of high-quality securities available for sale as of September 30, 2026. The liquidity of the Company and the Bank is also enhanced by its activity in the federal funds market and by its core deposits. Additionally, management believes it can raise debt or equity capital in the future, should the need arise.
Another factor affecting liquidity is the amount of deposits and customer repurchase agreements that have pledging requirements. All customer repurchase agreements require collateral in the form of a security. The U.S. Government, other public entities, and certain trust depositors require the Company to pledge securities if their deposit balances are greater than the FDIC-insured deposit limitations. These pledging requirements affect liquidity risk in that the related security cannot otherwise be disposed of due to the pledging restriction. There were $12.3 billion and $13.4 billion of securities pledged to secure U.S. Government deposits, other public deposits, certain trust deposits, derivative transactions, and repurchase agreements at September 30, 2026 and December 31, 2025, respectively.
The Company also has other commercial commitments that may impact liquidity. These commitments include unused commitments to extend credit, standby letters of credit and financial guarantees, and commercial letters of credit. The total amount of these commercial commitments at September 30, 2026 was $26.8 billion. Since many of these commitments expire without being drawn upon, the total amount of these commercial commitments does not necessarily represent the future cash requirements of the Company.
The Company's cash requirements consist primarily of dividends to shareholders, debt service, operating expenses, and treasury stock purchases. Management fees and dividends received from bank and non-bank subsidiaries traditionally have been sufficient to satisfy these requirements and are expected to be sufficient in the future. The Bank is subject to various rules regarding payment of dividends to the Company. For the most part, the Bank can pay dividends at least equal to its current year's earnings without seeking prior regulatory approval. The Company also uses cash to inject capital into its bank and non-bank subsidiaries to maintain adequate capital as well as fund strategic initiatives.
In September 2022, the Company issued $110.0 million in aggregate subordinated notes due in September 2032. The Company received $107.9 million, after deducting underwriting discounts and commissions and offering expenses, and used the proceeds from the offering for general corporate purposes, including, among other uses, contributing Tier 1 capital into the Bank. The subordinated notes were issued with a fixed-to-fixed rate of 6.25% and an effective rate of 6.64%, due to issuance costs, with an interest rate reset date of September 2027.
As part of the acquisition of HTLF, the Company acquired $150.0 million in aggregate subordinated notes due September 2031. The subordinated notes had a fixed interest rate of 2.75% until September 2026. The subordinated notes had an acquired fair value of $138.8 million as of January 31, 2025. During the third quarter of 2026, the Company redeemed all of these outstanding subordinated notes.
The Company is a member bank of the FHLB. The Company owns $10.1 million of FHLB stock and has access to additional liquidity and funding sources through FHLB advances. The Company's borrowing capacity is dependent upon the amount of collateral the Company places at the FHLB. As of September 30, 2026 the Company has three letters of credit outstanding with the FHLB of Des Moines to secure deposits. These letters of credit have an aggregate amount of $53.0 million and have various maturity dates through December 10, 2026. The Company's remaining borrowing capacity with the FHLB was $2.7 billion as of September 30, 2026. The Company had no outstanding FHLB advances with the FHLB of Des Moines as of September 30, 2026.
In addition to borrowing capacity with the FHLB as described above, the Company had additional liquidity of $34.7 billion available via cash, unpledged bond collateral, the federal funds market, the Federal Reserve Discount Window, and the IntraFi Cash Service program as of September 30, 2026.
Operational Risk
Operational risk generally refers to the risk of loss resulting from the Company's operations, including those operations performed for the Company by third parties. This would include but is not limited to the risk of fraud by employees or persons outside the Company, the execution of unauthorized transactions by employees or others, errors relating to transaction processing, breaches of the internal control system and compliance requirements, and unplanned interruptions in service. This risk of loss also includes the potential legal or regulatory actions that could arise as a result of an operational deficiency, or as a result of noncompliance with applicable regulatory standards. The Company must comply with a number of legal and regulatory requirements.
The Company operates in many markets and relies on the ability of its employees and systems to properly process a high number of transactions. In the event of a breakdown in internal control systems, improper operation of systems or improper employee actions, the Company could suffer financial loss, face regulatory action and suffer damage to its reputation. In order to address this risk, management maintains a system of internal controls with the objective of providing proper transaction authorization and execution, safeguarding of assets from misuse or theft, and ensuring the reliability of financial and other data.
The Company maintains systems of internal controls that provide management with timely and accurate information about the Company's operations. These systems have been designed to manage operational risk at appropriate levels given the Company's financial strength, the environment in which it operates, and considering factors such as competition and regulation. The Company has also established procedures that are designed to ensure that policies relating to conduct, ethics, and business practices are followed on a uniform basis. In certain cases, the Company has experienced losses from operational risk. Such losses have included the effects of operational errors that the Company has discovered and included as expense in the statement of income. While there can be no assurance that the Company will not suffer such losses in the future, management continually monitors and works to improve its internal controls, systems, and corporate-wide processes and procedures.
ITEM 4. CONTROLS AND PROCEDURES
The Sarbanes-Oxley Act of 2002, as amended, requires the Chief Executive Officer and the Chief Financial Officer to make certain certifications under this Form 10-Q with respect to the Company's disclosure controls and procedures and internal control over financial reporting. The Company has a Code of Ethics that expresses the values that drive employee behavior and maintains the Company's commitment to the highest standards of ethics.
Disclosure Controls and Procedures
The Company's management, with the participation of the Company's Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company's "disclosure controls and procedures" (as such term is defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)) as of the end of the period covered by this Form 10-Q. Based on such evaluation, the Company's Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this Form 10-Q, the Company's disclosure controls and procedures were effective for ensuring that the Company's SEC filings are recorded, processed, summarized, and reported within the time period required and that information required to be disclosed by the Company is accumulated and communicated to the Company's management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosures.
Internal Control Over Financial Reporting
There has been no change in the Company's internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) during the three months ended September 30, 2026 that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
In the normal course of business, the Company and its subsidiaries are named defendants in various legal proceedings. In the opinion of management, after consultation with legal counsel, none of these lawsuits are expected to have a materially adverse effect on the financial position, results of operations, or cash flows of the Company.
ITEM 1A. RISK FACTORS
There were no material changes to the risk factors as previously disclosed in response to Item 1A to Part I of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2025.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
The table below sets forth the information with respect to purchases made by or on behalf of the Company or any "affiliated purchaser" (as defined in Rule 10b-18(a)(3) under the Exchange Act) of our common stock during the three-month period ended September 30, 2026.
ISSUER PURCHASE OF EQUITY SECURITIES
|
Period |
Total Number of Shares (or Units) Purchased (1) |
Average Price Paid per Share (or Unit) |
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs (2) |
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs |
||||||||||||
|
July 1 - July 31, 2026 |
38 |
$ |
141.98 |
- |
1,961,842 |
|||||||||||
|
August 1 - August 31, 2026 |
- |
- |
- |
1,961,842 |
||||||||||||
|
September 1 - September 30, 2026 |
- |
- |
- |
1,961,842 |
||||||||||||
|
Total |
38 |
$ |
141.98 |
- |
||||||||||||
(1) Includes shares acquired pursuant to the Company's share-based incentive programs. Under the terms of the Company's share-based incentive programs, the Company accepts previously owned shares of common stock surrendered to satisfy tax withholding obligations associated with equity compensation. These purchases do not count against the maximum value of shares remaining available for purchase under Repurchase Authorizations.
(2) Includes shares acquired under the Board of Directors approved Repurchase Authorization(s).
On April 29, 2025, the Company announced a plan to repurchase up to one million shares of common stock, which terminated on April 28, 2026. On April 28, 2026, the Company announced a plan to repurchase up to two million shares of common stock, which will terminate on April 27, 2027. The Company has not made any repurchases other than through the Repurchase Authorizations, but did acquire shares pursuant to the Company's share-based incentive programs. All share purchases pursuant to the Repurchase Authorizations are intended to be within the scope of Rule 10b-18 promulgated under the Exchange Act. Rule 10b-18 provides a safe harbor for purchases in a given day if the Company satisfies the manner, timing and volume conditions of the rule when purchasing its own shares of common stock.
ITEM 5. OTHER INFORMATION
On August 25, 2026, three foundations and trusts that are related interests of Chairman and Chief Executive Officer J. Mariner Kemper adopted a single, pre-arranged stock sale plan in accordance with Rule 10b5-1(c) (Rule 10b5-1) under the Exchange Act for the sale of shares of the Company's common stock (the 2027 Plan). The 2027 Plan was entered into during an open trading window in accordance with the Company's requirements regarding transactions in the Company's securities and is intended to satisfy the affirmative defense conditions of Rule 10b5-1. The 2027 Plan provides for the monthly sale of an initial number of shares of the Company's common stock on the
first business day of each month. In addition, the 2027 Plan provides for the sale of an additional number of shares once the market price of the Company's common stock meets or exceeds certain minimum threshold prices as specified in the 2027 Plan. Should the market price of the Company's shares meet or exceed secondary and tertiary pricing thresholds as specified in the 2027 Plan, up to one and a half and double the initial number of shares in the aggregate may be sold in that month, respectively. Sales under the 2027 Plan may occur beginning in January of 2027 (after conclusion of the applicable cooling off period following adoption of the 2027 Plan) and end no later than December 31, 2027. The aggregate number of shares of common stock of the Company that will be sold under the 2027 Plan will vary depending on the market price achieved but will not exceed a maximum of 105,024 shares in aggregate.
UMB Financial Corporation published this content on October 29, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on October 29, 2026 at 13:06 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]