On April 24, 2025, Atlantic Union Bankshares Corp (AUB, Financial) released its 8-K filing detailing its financial performance for the first quarter of 2025. The company reported net income available to common shareholders of $46.9 million, with basic and diluted earnings per share of $0.53 and $0.52, respectively. This performance fell short of analyst estimates, which projected earnings per share of $0.67. The company's revenue for the quarter was not explicitly stated, but the net interest income was reported at $184.2 million.
Company Background
Atlantic Union Bankshares Corp is a financial holding company and a bank holding company. Through its community bank subsidiary, the company provides a wide range of financial services, including banking, trust, and wealth management. It operates through two main segments: Wholesale Banking and Consumer Banking, with the majority of its revenue derived from Wholesale Banking.
Performance and Challenges
The first quarter of 2025 was marked by significant events for Atlantic Union Bankshares Corp, including the completion of its merger with Sandy Spring Bancorp, Inc. on April 1, 2025. This merger, which was completed ahead of schedule, is expected to enhance the company's presence in Virginia and Maryland. However, the quarter also presented challenges, as the economic outlook became more uncertain, leading to increased volatility in financial markets and abrupt changes in governmental policies. These factors prompted the company to bolster its loan loss reserves.
Financial Achievements
Despite missing earnings estimates, Atlantic Union Bankshares Corp achieved several financial milestones. The company reported a net interest margin increase of 12 basis points to 3.38%, driven by lower deposit costs following a decrease in the federal funds rate. Additionally, the company experienced growth in average loan and customer deposit balances, contributing to its overall financial stability.
Key Financial Metrics
Atlantic Union Bankshares Corp's net interest income for the first quarter was $184.2 million, a slight increase from the previous quarter. The company's net interest margin (FTE) rose to 3.45%, reflecting improved cost management. Nonperforming assets as a percentage of total loans held for investment increased to 0.38%, primarily due to a new nonaccrual loan within the commercial and industrial portfolio.
| Metric | Q1 2025 | Q4 2024 |
|---|---|---|
| Net Interest Income | $184.2 million | $183.2 million |
| Net Interest Margin (FTE) | 3.45% | 3.33% |
| Nonperforming Assets | 0.38% | 0.32% |
Analysis and Commentary
John C. Asbury, President and CEO of Atlantic Union, commented on the quarter's developments, stating,
It was an eventful first quarter for Atlantic Union. We were pleased to close our acquisition of Sandy Spring on April 1st, a full quarter ahead of our original expectations due to our receipt of required regulatory approvals earlier than anticipated. The earlier close is expected to accelerate the achievement of our anticipated cost savings from the transaction."This strategic acquisition is expected to bolster the company's market position and drive future growth.
Conclusion
Atlantic Union Bankshares Corp's first quarter of 2025 was characterized by strategic growth initiatives and financial challenges. While the company fell short of earnings expectations, its proactive measures to strengthen its financial position and expand its market presence through the Sandy Spring merger highlight its commitment to long-term growth and stability. As the economic landscape continues to evolve, Atlantic Union remains focused on soundness, profitability, and growth.
Explore the complete 8-K earnings release (here) from Atlantic Union Bankshares Corp for further details.
