AUB — Atlantic Union Bankshares Corporation

Atlantic Union Bankshares (AUB) Q2 2026 Earnings Call Summary

1. Key Financial Results and Metrics

• Net Income: Reported net income available to common shareholders was $158 million, with adjusted operating earnings at $134 million ($0.94 per share).
• Return Metrics: Adjusted operating return on tangible common equity (ROTCE) was 20.11%, and return on assets (ROA) was 1.47%.
• Loan Growth: Average loans reached $28.2 billion, growing approximately 6% annualized in Q2, with period-end loans at $28.7 billion (10.4% annualized growth from Q1).
• Deposits: Total deposits increased by 1% annualized to $30.5 billion, with average deposits down 2.4% for the quarter.
• Net Interest Margin (NIM): Reported NIM increased by 9 basis points to 3.94%, with core NIM (excluding accretion income) at 3.46%.
• Credit Quality: Net charge-offs were low at 3 basis points, with nonperforming assets at 39 basis points of loans held for investment.

2. Strategic Updates and Business Highlights

• Merger Costs: For the first time in two years, no merger-related costs were incurred.
• Capital Generation: The bank reported a $32.3 million pre-tax gain from the sale of equity interest in Bearing Insurance, contributing to overall capital generation.
• Expansion Plans: The bank is focusing on organic growth, particularly in North Carolina, with plans to open 10 new branches by 2027.
• Commercial Lending: Strong client activity in commercial lending and construction led to record loan production, exceeding expectations.

3. Forward Guidance and Outlook

• Loan Growth: Full-year loan growth is expected to finish at the higher end of the mid-single-digit range, with projections for loan balances between $29 billion and $30 billion.
• NIM Guidance: The NIM is projected to be between 3.90% and 3.95%, factoring in a potential Federal Reserve rate hike.
• Noninterest Income: Expected to be between $220 million and $230 million for the full year.
• Expense Management: Adjusted operating noninterest expense is estimated to be between $742 million and $752 million.

4. Bad News, Challenges, or Points of Concern

• Deposit Competition: There is increasing competition for deposits, leading to higher funding costs, particularly in interest-bearing accounts.
• Economic Uncertainty: Geopolitical tensions, particularly around Iran, and potential economic slowdowns could impact customer confidence and loan demand.
• Credit Quality Risks: Although current metrics are strong, there is a cautious outlook regarding potential upticks in unemployment and its impact on credit quality.

5. Notable Q&A Insights

• Loan Yields: New loan production yields are around 200 basis points, with expectations for improved yields as variable rate loans mature.
• Deposit Mix: The bank is experiencing a shift towards higher-yielding interest-bearing deposits, impacting overall funding costs.
• Buyback Strategy: The bank plans to utilize its share repurchase authorization, contingent on share price and capital needs for loan growth.
• Balance Sheet Management: A focus on funding loan growth through core deposits rather than relying on the securities portfolio.

Overall, Atlantic Union Bankshares reported strong Q2 results with solid loan growth and improved margins, while navigating challenges related to deposit competition and economic uncertainty. The bank remains focused on strategic expansion and maintaining strong credit quality.