UMB Financial Q4 Earnings Beat on Higher NII & Non-Interest Income

Core Viewpoint - UMB Financial Corp. reported strong fourth-quarter 2024 results, with operating earnings per share of $2.49, exceeding estimates and showing year-over-year growth [1][2]. Financial Performance - Fourth-quarter net income on a GAAP basis was $119.9 million, reflecting a 69.2% increase year over year [2]. - For the full year 2024, operating earnings per share reached $12.75, surpassing the consensus estimate of $9.23 and increasing from $10.76 in 2023 [3]. - Total net income for 2024 was $441.2 million, up 26% from the previous year [3]. Revenue and Expenses - Quarterly revenues amounted to $440.5 million, a 16.7% increase year over year, and exceeded the Zacks Consensus Estimate by 6.4% [4]. - For 2024, total revenue was $1.65 billion, surpassing the consensus estimate of $1.62 billion and rising 10.7% year over year [4]. - Non-interest income for the fourth quarter was $165.2 million, up 17.8% year over year, driven by increases in various fee income components [5]. - Non-interest expenses decreased to $270.4 million, down 6.8% year over year, primarily due to lower regulatory fees [6]. Loans and Deposits - As of December 31, 2024, average loans and leases were $25.3 billion, up 3.7% sequentially, while average deposits increased 7.7% to $38.1 billion [7]. Credit Quality - The ratio of net charge-offs to average loans was 0.14%, up from 0.02% in the prior-year quarter, indicating a decline in credit quality [8]. - Total non-accrual and restructured loans rose to $19.3 million, a 45.9% increase year over year [8]. - The provision for credit losses for the fourth quarter was $19 million, compared to no provision in the year-ago quarter [8]. Capital Ratios - As of December 31, 2024, the Tier 1 risk-based capital ratio was 11.29%, up from 10.94% a year earlier [9]. - The Tier 1 leverage ratio increased to 8.50% from 8.49% as of December 31, 2023 [9]. - The total risk-based capital ratio grew to 13.21%, up from 12.85% in the prior year [9]. Profitability Ratios - Return on average assets at the end of the quarter was 1.06%, an increase from 0.69% in the year-ago quarter [10]. - The operating return on average equity was 13.82%, down from 15.04% in the prior-year quarter [10]. Overall Assessment - UMB Financial benefits from strong revenue growth driven by rising loan and deposit balances, alongside diversified fee income, although concerns remain regarding deteriorating asset quality [11].