AUB — Atlantic Union Bankshares Corporation

Atlantic Union Bankshares (AUB) Q4 2025 Earnings Call Summary

1. Key Financial Results and Metrics

• Net Income: $109 million for Q4 2025; $261.8 million for the full year.
• Earnings per Share (EPS): $0.77 for Q4; $2.03 for the full year.
• Adjusted Operating Earnings: $138.4 million ($0.97 per share) for Q4; $444.8 million ($3.44 per share) for the full year.
• Return on Tangible Common Equity: 22.1% for Q4; 20.4% for the full year.
• Return on Assets: 1.5% for Q4; 1.33% for the full year.
• Efficiency Ratio: 47.8% for Q4; 49.7% for the full year.
• Net Interest Margin: Increased to 3.96%, up 13 basis points from Q3.
• Loan Growth: 6.3% annualized growth, ending the year at $27.8 billion.
• Deposits: Decreased by 2.5% annualized to $30.5 billion, primarily due to seasonal fluctuations.

2. Strategic Updates and Business Highlights

• Successful integration of the Sandy Springs acquisition, with core systems conversion completed in October 2025.
• Loan production reached record highs in Q4, with a strong pipeline indicating continued growth into 2026.
• Fee income was robust, driven by loan-related interest rate swap fees and fiduciary and asset management fees.
• Credit quality remained strong, with a net charge-off ratio of 1 basis point for Q4 and 17 basis points for the full year.
• Continued focus on organic growth opportunities in Virginia and North Carolina, with plans to open 10 branches in Raleigh and Wilmington over the next two years.

3. Forward Guidance and Outlook

• 2026 Loan Balances: Expected to range between $29 billion and $30 billion.
• Deposit Growth: Projected at 3% to 4% for 2026.
• Net Interest Income: Expected between $1.35 billion and $1.375 billion for 2026.
• Net Charge-Off Ratio: Anticipated to fall between 10 and 15 basis points in 2026.
• Tangible Book Value Growth: Projected annual growth of 12-15%.

4. Challenges and Points of Concern

• Deposit Decline: The decrease in deposits was attributed to seasonal fluctuations and the return of large commercial depositors.
• Economic Uncertainty: Ongoing economic challenges and potential increases in unemployment rates could impact loan growth.
• Merger-Related Expenses: Continued impact from merger-related costs, though expected to decline in 2026.
• Credit Losses: Noted episodic increases in noncredit-related customer losses due to fraud, which could pose risks if they recur.

5. Notable Q&A Insights

• Loan Pipeline: Increased modestly in Q4, with positive feedback from market leaders indicating strong demand.
• Deposit Costs: Expected to remain below 2%, with a beta forecast in the mid-50s for interest-bearing deposits.
• Accretion Income: Projected to decrease in 2026, with a baseline estimate of $150-$160 million.
• North Carolina Expansion: Progressing well with plans for branch openings and hiring, although hiring may be cautious due to seasonal bonus payments.
• Share Repurchase Plans: Potential for share buybacks in late Q2 or Q3 2026, contingent on capital levels exceeding 10.5% CET1.

Overall, Atlantic Union Bankshares demonstrated strong financial performance in Q4 2025, with positive growth indicators and strategic initiatives in place, despite facing some challenges related to economic conditions and deposit fluctuations.