Financial Performance - For the nine months ended September 30, 2023, net income was $279.1 million, compared to $331.5 million for the same period in 2022, reflecting a decrease of approximately 15.8%[152]. - For the three months ended September 30, 2023, net interest income was $222.3 million, a decrease from $233.5 million in the same period of 2022[151]. - Total noninterest income for the nine months ended September 30, 2023, was $401.6 million, compared to $428.7 million for the same period in 2022, indicating a decrease of approximately 6.3%[166]. - Total noninterest income for the three months ended September 30, 2023, was $133.3 million, an increase from $128.7 million for the same period in 2022, representing a growth of approximately 3.9%[165]. - The Company aims to grow noninterest income through fee-based products and services, which are less affected by interest rate fluctuations[255]. Loan Portfolio and Credit Quality - As of September 30, 2023, total loans amounted to $22,840.4 million, a slight decrease from $21,001.5 million on December 31, 2022[41]. - The total past due loans amounted to $41,212 million as of September 30, 2023, compared to $29,661 million at December 31, 2022[41]. - Nonaccrual loans with no related allowance for credit losses totaled $14.6 million as of September 30, 2023, down from $16.7 million at December 31, 2022[42]. - The company monitors credit quality indicators including net charge-offs and non-performing loans to assess the loan portfolio's health[47]. - The overall risk profile shows a decrease in watch-list loans, suggesting improved asset quality[65]. Allowance for Credit Losses - The allowance for credit losses (ACL) for the total loans is $224,348,000 as of September 30, 2023, compared to $224,989,000 at the beginning of the period[99]. - The provision for credit losses for the nine months ended September 30, 2023, was $39,227 million, compared to $28,400 million for the same period in 2022, reflecting an increase in reserves[100]. - The allowance for credit losses increased to $224,348 million as of September 30, 2023, up from $187,432 million at the end of the previous period[100]. - Net charge-offs for the nine-month period ended September 30, 2023, were $9.1 million, significantly lower than $37.7 million for the same period in 2022, indicating improved credit quality[252]. Securities and Investments - Securities available for sale totaled $7.2 billion as of September 30, 2023, with gross unrealized losses of $918.4 million[109]. - The total amortized cost of securities available for sale was $7.2 billion as of September 30, 2023[110]. - The fair value of U.S. Treasury securities was $779.4 million as of September 30, 2023, with unrealized losses of $17.9 million[114]. - The Company recorded unrealized losses of $773.39 million across its investment portfolio due to changes in interest rates, not credit declines[115]. Borrowings and Debt - The Company’s total borrowed funds amounted to $2,682,768 thousand as of September 30, 2023, significantly higher than $381,311 thousand as of December 31, 2022[138]. - The Company had two short-term advances of $1.0 billion and $500.0 million outstanding at FHLB of Des Moines as of September 30, 2023, with a borrowing capacity of $436.7 million[142]. - The Company had an $800.0 million short-term borrowing outstanding with the Federal Reserve Bank's Bank Term Funding Program (BTFP) as of September 30, 2023, with remaining borrowing capacity of $20.0 million[143]. Risk Management - The Company actively monitors credit quality indicators, which include updated financial records and credit scores, to adjust the current estimates of expected credit losses[95]. - The risk grading matrix categorizes loans into Non-watch list, Watch, Special Mention, Substandard, and Doubtful, with ongoing monitoring for changes in credit risk[48]. - Credit risk is managed through formal risk management practices, including consistent underwriting standards and thorough client analysis[40]. Strategic Initiatives - The company plans to expand its market presence through strategic acquisitions and new product developments in the upcoming quarters[65]. - The Company has a robust credit risk monitoring process, including pre-purchase and ongoing post-purchase credit reviews[126].
UMB Financial Corporation(UMBFP) - 2023 Q3 - Quarterly Report