Reports UMB Financial Q4 Net Income of $120M and Full-Year Net Income of $441.2M
UMB Financial Corporation (Nasdaq: UMBF), a leading financial services provider, reports net income of $120.0 million, or $2.44 per diluted share, for the fourth quarter of 2024. This marks an increase from $109.6 million, or $2.23 per diluted share, in the third quarter of 2024 and a significant rise from $70.9 million, or $1.45 per diluted share, in the fourth quarter of 2023.
UMB Financial reports a strong performance in Q4 2024, reflecting solid growth across both sides of its balance sheet, sustained momentum in fee-based businesses, and strategic investments that have bolstered its operating fundamentals. For the quarter, the company reports net operating income of $122.6 million, or $2.49 per diluted share, representing an increase from $110.4 million, or $2.25 per diluted share, in the previous quarter and a slight decrease from $112.0 million, or $2.29 per diluted share, in Q4 2023. Net operating income is a non-GAAP measure, which will be reconciled to net income later in this report.
Operating pre-tax, pre-provision income (operating PTPP), another key non-GAAP metric, reports $166.9 million, or $3.39 per diluted share. This represents an 8.0% increase from the linked quarter and a 23.7% increase compared to the same quarter in the previous year. Operating PTPP highlights the company’s strong operational performance before tax and provision for credit losses, offering insights into the strength of its underlying business.
Mariner Kemper, Chairman and CEO of UMB Financial Corporation, emphasized the success of the company’s efforts throughout 2024, noting, “Our results for the fourth quarter capped an exceptional year for UMB Financial, underpinned by solid operating fundamentals that have consistently driven shareholder value.” He added that 2024 was a record-breaking year, with the company reporting annual net income of $441.2 million and net operating income of $461.7 million. These records were further complemented by surpassing $1.0 billion in net interest income and $628.1 million in noninterest income.
Revenue and Loan Growth
In Q4 2024, UMB Financial reports net interest income of $269.0 million, up 8.7% from the previous quarter. This increase was driven by a combination of strong balance sheet growth, improved reinvestment yields, and a reduction in interest expense due to favorable changes in the funding composition, particularly in deposits. The company’s average earning assets grew by $1.6 billion, or 3.9%, compared to the prior quarter, with key increases in loans, securities, and federal funds sold and resell agreements.
The company reports robust loan growth, with average loan balances increasing by 14.8% on a linked-quarter annualized basis. UMB Financial produced $1.6 billion in new loans during the quarter, setting a new record for loan production.
UMB reports a net interest margin (NIM) for Q4 of 2.57%, reflecting an 11 basis point increase from the prior quarter, driven by a decrease in the cost of interest-bearing liabilities and favorable shifts in the funding mix. This was partially offset by a decrease in loan yields, which reflects broader market rate changes.
Fee-Based Income Growth
Noninterest income also reports strong performance in Q4 2024, increasing 4.1% from the previous quarter, totaling $165.2 million. Key contributors included a $4.1 million gain from the sale of UMB Distribution Services and a $2.9 million increase in brokerage income, driven by higher fees and money market income. Trust and securities processing revenue also saw a solid increase of $2.6 million, benefiting from robust activity in corporate trust, private wealth management, and other services.
Noninterest income for the quarter increased $25.0 million, or 17.8%, compared to the same period in the previous year. Significant year-over-year growth was seen across brokerage income, fund services income, corporate trust income, and gains from asset sales, including $4.1 million from the sale of UMB Distribution Services.
Annual and Quarterly Performance
For the full year 2024, UMB Financial reports record net income of $441.2 million and net operating income of $461.7 million, a testament to its strong business strategy and effective execution. The company also reports a substantial rise in average earning assets, which grew by $4.3 billion or 11.3% from the fourth quarter of 2023. This increase was driven by significant growth in loan balances and securities holdings.
UMB Financial reports a notable increase in average deposits, rising by 16.3% year-over-year. Interest-bearing deposits grew by 21.4%, while noninterest-bearing demand deposits saw a 5.1% increase. These deposit trends reflect the company’s success in attracting and retaining a diverse customer base.
Looking Ahead: Strategic Merger with Heartland Financial
Looking ahead, UMB Financial reports that it is poised to close its merger with Heartland Financial on January 31, 2025, following the receipt of necessary approvals. Kemper expressed his excitement about the merger, stating that both companies have been working diligently to ensure a smooth integration of their businesses. This merger is expected to further strengthen UMB’s market position and operational scale.
Conclusion
UMB Financial reports an impressive performance for the fourth quarter and full year of 2024, reflecting strong growth across both interest income and fee-based revenue. The company’s strategic initiatives have continued to bolster its financial position, and with the upcoming merger with Heartland Financial, UMB is well-positioned for further expansion and value creation in the years ahead.
