UMB Financial Corporation (NASDAQ:UMBF) Q3 2023 Earnings Conference Call October 25, 2023 9:30 AM ET Company Participants Kay Gregory - IR Mariner Kemper - President and CEO Ram Shankar - CFO Tom Terry - Chief Credit Officer Conference Call Participants Nathan Race - Piper Sandler Chris McGratty - KBW Timur Braziler - Wells Fargo Securities Nathan Race - Piper Sandler Operator Hello, and welcome to today's UMB Financial Third Quarter 2023 Financial Results Conference Call. My name is Elliot, and I'll be coo ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (MARK ONE) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-38481 UMB FINANCIAL CORPORATION (Exact name of registrant as specified in its charter) | Missouri | 43-0903811 | | --- | --- | | ...

Financial Data and Key Metrics Changes - GAAP net income for Q2 2023 was $90.1 million or $1.85 per share, while operating net income was $93.8 million or $1.93 per share [7] - Net interest income decreased from the first quarter due to increased deposit costs and liability mix shifts, despite strong loan growth and improved asset yields [7][8] - Net interest margin for Q2 was 2.44%, a decrease of 32 basis points from the linked quarter [14] Business Line Data and Key Metrics Changes - Average quarterly loan growth was 17.3% on a linked quarter annualized basis, with strong asset quality reflected in net recoveries of $139,000 for the quarter [8] - Nonperforming loans were just 0.09% of total loans as of June 30, with a provision for credit losses of $13 million for the quarter [8][9] - Total top line loan production was $986 million, with commercial and industrial lending being a significant driver of growth [10] Market Data and Key Metrics Changes - Average total deposits decreased by $87 million or 1.1% on an annualized basis from the first quarter to $31.5 billion [12] - Deposits stood at $33.5 billion at the end of June, an increase of 5% from March 31 [14] - The cost of total deposits for the quarter was 2.17%, compared to 1.62% in the first quarter [15] Company Strategy and Development Direction - The company aims to maintain flexibility on the asset side of the balance sheet, with a lower loan-to-deposit ratio compared to peers [5] - Focus remains on disciplined pricing of loans and controlling operating expenses while navigating the elevated interest rate environment [6] - The company is pursuing growth opportunities in various lending verticals while maintaining a strong capital and liquidity position [22] Management's Comments on Operating Environment and Future Outlook - Management noted that the economy remains resilient, with expectations that the bulk of the tightening cycle may be behind [6] - There is uncertainty regarding how long the Federal Reserve will maintain elevated rates, but the company remains focused on growth [6] - Management anticipates some modest margin compression in the third quarter due to the timing of the July rate hike [17] Other Important Information - The effective tax rate for Q2 was 18.1%, down from 20.8% in the same period last year, primarily due to a larger portion of income on tax-exempt securities [19] - The company recorded $7.4 million in additional salary and bonus expenses, largely driven by severance costs and higher salaries [18] Q&A Session Summary Question: What is the outlook for net interest income (NII) growth? - Management indicated mid-single-digit growth for NII is reasonable, but many variables could affect this outlook [25][26] Question: How is the company managing deposit pricing pressures? - Management believes they have experienced most of the pain from deposit pricing increases and expects the rate of increase to level off [33] Question: What is the company's strategy regarding capital return? - The company has share repurchase authorization but currently prioritizes loan growth over capital return [30][31] Question: How does the company view the competitive landscape for lending? - Management noted that competitors are pulling back, creating opportunities for the company, which continues to see a strong pipeline [42]

| --- | --- | --- | --- | |-----------------|--------|--------------|---------------| | | | | | | | 2nd | | | | | Update | Quarter 2023 | | | | | | | | Kansas City, MO | | | July 25, 2023 | Presentation Index Corporate Overview 3 Opportunity – Our Investment Thesis 8 2nd Quarter 2023 Results 17 Line of Business Updates 34 Appendix 45 Board of Directors Forward-Looking Statements Non-GAAP Reconciliations Peer Group Please refer to the Forward-Looking Statements on slide 47 for important disclosures about inf ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (MARK ONE) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-38481 UMB FINANCIAL CORPORATION (Exact name of registrant as specified in its charter) | Missouri | 43-0903811 | | --- | --- | | ...

Financial Data and Key Metrics Changes - Net income for Q1 2023 was $92.4 million or $1.90 per share, with operating pre-tax pre-provision EPS at $2.78, up from $2.44 in Q1 2022 [12][20] - Net interest income decreased by 1.4% compared to the previous quarter, with a net interest margin of 2.76%, down seven basis points [13][14] - Average deposit growth was 2.4% and average loan growth was 19.3% on a linked quarter annualized basis [6][9] Business Line Data and Key Metrics Changes - Total loan production for the quarter was $934 million, with commercial real estate and construction growth primarily from industrial and multi-family categories [7][8] - Non-interest income was reported at $130.2 million, with significant contributions from corporate trust and private wealth services [16][48] - Non-performing loans improved to 0.07% of total loans, with net charge-offs at just 0.09% of average loans [6][18] Market Data and Key Metrics Changes - The company reported a liquidity coverage of approximately 116% of uninsured deposits as of April 20 [11][23] - The average size of office credits in the portfolio is $8.2 million, with 82% being recourse loans and a weighted average loan-to-value of approximately 65% [8][52] Company Strategy and Development Direction - The company aims to maintain a disciplined approach to pricing and emphasize lending that comes with deposit relationships [9][15] - There is a focus on enhancing asset pricing discipline and leveraging the diverse deposit base to mitigate risks associated with rising deposit costs [11][15] - The company is positioned to benefit from a flattening yield curve and anticipates mid-single digit growth in net interest income year-over-year [16][41] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by inflation, changes in the yield curve, and deposit beta acceleration due to recent market volatility [4][5] - The company expects to continue seeing opportunities across various verticals despite anticipated economic slowdowns [9][41] - Management expressed confidence in the quality of the loan portfolio and the proactive measures taken to manage credit risk [6][18] Other Important Information - The effective tax rate for Q1 2023 was 17.2%, up from 15.7% in Q1 2022, primarily due to excess tax benefits related to equity-based compensation [20] - The company has a diverse deposit base, with 55% of deposit accounts spanning 10 years or more, and plans to further reduce uninsured deposits [11][12] Q&A Session Summary Question: What is the expected floor for DDA as a percentage of total deposits? - Management expects to maintain overall balances, with a potential slight movement from the current 38% due to higher interest rates, but does not anticipate significant changes [24][25][26] Question: What is the expected peak beta for overall cost of deposits? - The company anticipates the total cost of beta to be around 40% [27] Question: How quickly can rate cuts pass through to margin? - Historically, deposits move faster on the way down, which could benefit the company in future rate cuts [29] Question: What is the outlook for the office CRE portfolio? - The office portfolio is only 4.5% of total loans, with strong borrowers and low loan-to-values, and management does not foresee significant issues [30][31][52] Question: How does the recent ratings boundary affect deposits? - There was a brief disruption post-SVB failure, but the company has since recovered and does not expect long-term impacts [36] Question: What are the growth assumptions for net interest income in 2023? - The guidance includes one more Fed rate hike in May, with expectations for mid-single digit growth in net interest income [37][43] Question: What are the dynamics behind the recent short-term debt increase? - The increase in short-term debt was a precautionary measure, with plans to evaluate and normalize levels based on the current environment [43][44] Question: What are the growth drivers in fund services and corporate trust? - Growth is driven by multi-year investments and strong performance in private equity and corporate trust services [47][48]

| --- | --- | --- | |-----------------|--------------|----------------| | | | | | | Quarter 2023 | | | | | | | Kansas City, MO | | April 25, 2023 | Presentation Index Corporate Overview 3 Opportunity – Our Investment Thesis 8 1st Quarter 2023 Results 17 Line of Business Updates 34 Appendix 45 Board of Directors Forward-Looking Statements Non-GAAP Reconciliations Peer Group Please refer to the Forward-Looking Statements on slide 47 for important disclosures about information contained in this presentation. 2 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended: December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-38481 UMB FINANCIAL CORPORATION (Exact name of registrant as specified in its charter) | Missouri | 43-0903811 | | --- | --- | | (S ...

Financial Data and Key Metrics Changes - Net income for Q4 2022 was $100.2 million or $2.06 per share, with full-year net income of $431.7 million or $8.86 per share, representing a 22.3% increase compared to 2021 [4] - Operating pre-tax, pre-provision EPS for the year was $11.73 per share, up from $9.26 per share in the prior year [5] - Net interest income for Q4 increased by 5% sequentially, driven by over $1 billion increase in average loans, a 21% annualized increase [5][6] Business Line Data and Key Metrics Changes - Total loan production for Q4 was $1.3 billion, bringing full-year 2022 originations to a record $5 billion [7] - C&I lending contributed nearly half of the average loan growth for the quarter, with balances increasing 21% on a linked quarter annualized basis [8] - Average residential mortgage balances increased 21% year-over-year despite rising rates [9] Market Data and Key Metrics Changes - Average total deposits for Q4 increased by 5.3% or 21% on an annualized basis compared to Q3 [10] - DDA balances represented 40% of average deposits, down from 42% in Q3 [10] - Non-performing assets comprised a modest 5 basis points of total assets, indicating strong credit quality [9] Company Strategy and Development Direction - The company aims to maintain positive operating leverage and expects to generate leverage of 6.7% for the full year of 2022 [7] - Focus on commercial and institutional customers, with a unique funding mix that allows for different pacing in the current repricing environment [5][6] - The company is optimistic about growth opportunities in 2023, despite the unpredictability of the current rate environment [11] Management's Comments on Operating Environment and Future Outlook - Management noted that customers are cautiously optimistic about the economic environment, with strong pipelines for the first quarter [22] - The company does not anticipate significant changes in the need for HSAs following the recent acquisition, maintaining a competitive position in the market [23][24] - Management expects net interest income to continue growing, driven by loan growth and market share gains [34] Other Important Information - The effective tax rate was 19.1% for Q4 and 18.9% for the full year, with expectations for 2023 to be around 19% to 20% [18] - Total fee income for Q4 was $125.5 million, a slight decrease from $128.7 million in Q3, with a full-year increase of 18.6% in fee income [15][16] Q&A Session Summary Question: Thoughts on tightening credit in a recessionary environment - Management stated they do not change their approach based on economic conditions and focus on quality opportunities [21] Question: Outlook for HSA acquisition and competitive positioning - Management expressed confidence in their competitive platform and strong pipeline following the HSA acquisition [23][24] Question: Insights on balance sheet and deposit runoff - Management clarified they expect rotation rather than runoff in deposits, with a strong pipeline for growth [28][29] Question: Expectations for margin trajectory and loan growth - Management anticipates continued net interest income growth and stable margins, driven by market share gains [34] Question: Trends in charge-offs and credit quality - Management expects to maintain performance levels without significant changes in charge-off guidance [42]

| --- | --- | --- | |-----------------|----------------------------|------------------| | | | | | | 4 th Quarter 2022 Update | | | Kansas City, MO | | January 24, 2023 | Presentation Index Corporate Overview 3 Opportunity – Our Investment Thesis 8 4th Quarter 2022 Results 16 Line of Business Updates 30 Appendix 40 Board of Directors Forward-Looking Statements Non-GAAP Reconciliations Peer Group Please refer to the Forward-Looking Statements on slide 42 for important disclosures about information contained i ...