Exhibit 99.1

Contact:              Robert M. Gorman - (804) 523‑7828

Executive Vice President / Chief Financial Officer

ATLANTIC UNION BANKSHARES REPORTS FOURTH QUARTER AND FULL YEAR  RESULTS

Richmond, Va., January 21, 2020 – Atlantic Union Bankshares Corporation (the “Company” or “Atlantic Union”) (Nasdaq: AUB) today reported net income of $55.8 million and earnings per share of $0.69 for its fourth quarter ended December 31, 2019. Net operating earnings(1) were $57.3 million and operating earnings per share(1) were $0.71  for its fourth quarter ended December 31, 2019; these operating results exclude $709,000 in after-tax merger and $713,000 in after-tax rebranding-related costs.

Net income was $193.5 million and earnings per share were $2.41 for the year ended December 31, 2019. Net operating earnings(1) were $220.9 million and operating earnings per share(1) were $2.75 for the year ended December 31, 2019; these operating results exclude $22.3 million in after-tax merger and $5.1 million in after-tax rebranding-related costs but include after tax losses from discontinued operations of $170,000 and approximately $1.0 million in after-tax expenses related to branch closure costs.

“Atlantic Union closed out an eventful 2019 with a solid fourth quarter - continuing to execute on our strategic plan and further improving performance against our key financial metrics despite the challenging interest rate environment,” said John C. Asbury, CEO of Atlantic Union Bankshares.  “As we begin 2020 we continue to believe we have a great opportunity before us to create something uniquely valuable for our shareholders and the communities we serve and remain keenly focused on reaching the full potential of this powerful franchise.”

 

Select highlights for the fourth quarter of 2019

 

Select highlights for the full year 2019

 

 

(1) These are financial measures not calculated in accordance with generally accepted accounting principles (“GAAP”). For a reconciliation of these non-GAAP financial measures, see Alternative Performance Measures (non-GAAP) section of the Key Financial Results.

 

 

NET INTEREST INCOME

For the fourth quarter of 2019, net interest income was $135.1 million, a decrease of $1.5 million from the third quarter of 2019. Net interest income (FTE)(1) was $137.8 million in the fourth quarter of 2019, a decrease of $1.6 million from the third quarter of 2019. The decreases in both net interest income and net interest income (FTE) were primarily driven by lower earning asset yields during the three months ended December 31, 2019 compared to the three months ended September 30, 2019. The fourth quarter net interest margin decreased 9 basis points to 3.48% from 3.57% in the previous quarter, while the net interest margin (FTE)(1) decreased 9 basis points to 3.55% from 3.64% during the same periods. The decreases in the net interest margin and net interest margin (FTE) were principally due to an 18 basis point decrease in the yield on earning assets, partially offset by a 9 basis point decrease in the cost of funds.

The Company’s net interest margin (FTE) includes the impact of acquisition accounting fair value adjustments. During the fourth quarter of 2019, net accretion related to acquisition accounting increased $1.5 million from the prior quarter to $6.6 million for the quarter ended December 31, 2019. The third and fourth quarters of 2019, and the remaining estimated net accretion impact are reflected in the following table (dollars in thousands):

 

 

ASSET QUALITY/LOAN LOSS PROVISION

Overview

During the fourth quarter of 2019, the Company experienced decreases  in nonperforming assets (“NPA”) primarily due to nonaccrual customer payments and sales of foreclosed properties. Past due loan levels as a percentage of total loans held for investment at December 31, 2019 were higher than past due loan levels at September 30, 2019 and down from past due loan levels at December 31, 2018. The increase in past due loans from the prior quarter was primarily driven by a seasonal increase related to residential 1-4 family – consumer loans that were 30 days past due as of year-end of which the majority subsequently became current. Net charge-off levels  decreased from the third quarter of 2019 and were primarily related to the third party consumer loan portfolio; as a result, the provision for loan losses decreased from the third quarter of 2019.

All nonaccrual and past due loan metrics discussed below exclude purchased credit impaired (“PCI”) loans totaling $86.7 million  (net of fair value mark of $18.2 million) at December 31, 2019.

 

 

Nonperforming Assets

At December 31, 2019, NPAs totaled $32.9 million, a decrease of $3.5 million or 9.6%, from September 30, 2019 and a decrease of $735,000 or 2.2%, from December 31, 2018. NPAs as a percentage of total outstanding loans at December 31, 2019 were 0.26%, a decline of 4 basis points from 0.30% at September 30, 2019 and a  decline of 9 basis points from 0.35% at December 31, 2018. As the Company’s NPAs have been at or near historic lows over the last several quarters, certain changes from quarter to quarter might stand out in comparison to one another but do not have a significant impact on the Company’s overall asset quality position. 

 

The following table shows a summary of nonperforming asset balances at the quarter ended (dollars in thousands):

 

 

The following table shows the activity in nonaccrual loans for the quarter ended (dollars in thousands):

 

 

The following table shows the activity in foreclosed properties for the quarter ended (dollars in thousands):

 

Past Due Loans

Past due loans still accruing interest totaled $76.6 million or 0.61% of total loans held for investment at December 31, 2019,  compared to $55.1 million or 0.45% of total loans held for investment at September 30, 2019, and $61.9 million or 0.64% of total loans held for investment at December 31, 2018.  Of the total past due loans still accruing interest $13.4 million or 0.11% of total loans held for investment were loans past due 90 days or more at December 31, 2019, compared to $12.0 million or 0.10% of total loans held for investment at September 30, 2019, and $8.9 million or 0.09% of total loans held for investment at December 31, 2018. The increase in past due loans was primarily driven by a seasonal increase related to residential 1-4 family - consumer loans that were 30 days past due as of year-end of which the majority subsequently became current.

Net Charge-offs

For the fourth quarter of 2019, net charge-offs were $4.6 million or 0.15% of total average loans on an annualized basis, compared to $7.7 million or 0.25% for the prior quarter, and $5.0 million or 0.21% for the fourth quarter last year. The majority of net charge-offs in the fourth quarter of 2019 were related to consumer loans. For the year ended December 31, 2019, net charge-offs were $20.9 million or 0.17% of total average loans compared to $11.1 million or 0.12%, for the year ended 2018.

Provision for Loan Losses

The provision for loan losses for the fourth quarter of 2019 was $3.1 million, a decrease of $6.0 million compared to the previous quarter and  a decrease of $1.7 million compared to the fourth quarter in 2018. The decrease in the provision for loan losses from the previous quarter and from the prior year were primarily driven by lower levels of net charge-offs.

Allowance for Loan Losses (“ALL”)

The ALL decreased $1.5 million from September 30, 2019 to $42.3 million at  December 31, 2019, primarily due to lower incurred losses embedded in the third party consumer portfolio as it continues to pay down and an improved economic environment, partially offset by loan growth during the quarter. The ALL as a percentage of the total loan portfolio was 0.34% at December 31, 2019, 0.36% at September 30, 2019, and 0.42% at December 31, 2018.  

The ratio of the ALL to nonaccrual loans was 149.8% at December 31, 2019, compared to 145.9% at September 30, 2019 and 152.3% at December 31, 2018.  The current level of the allowance for loan losses reflects specific reserves related to nonperforming loans, current risk ratings on loans, net charge-off activity, loan growth, delinquency trends, and other credit risk factors that the Company considers important in assessing the adequacy of the allowance for loan losses.

NONINTEREST INCOME

Noninterest income decreased $18.9 million to $29.2 million for the quarter ended December 31, 2019 from $48.1 million in the prior quarter. The decrease from prior quarter was primarily driven by approximately $9.3 million in life insurance proceeds received during the third quarter related to a Xenith-acquired loan that had been charged off prior to the Company’s acquisition of Xenith and a gain on sale of investment securities of approximately $7.1 million recorded during the third quarter. In addition, the fourth quarter noninterest income included a decline of approximately $2.0 million in loan related interest rate swap income due to lower transaction volumes and seasonally lower mortgage banking revenue of $685,000.  

NONINTEREST EXPENSE

Noninterest expense decreased $17.4 million for the quarter ended December 31, 2019 from $111.7 million in the prior quarter. Excluding merger-related costs, amortization of intangible assets, and rebranding-related costs, operating noninterest expense(1) decreased $15.4 million or 14.9%, in the fourth quarter of 2019. The decrease in operating noninterest expense was primarily due to the recognition of approximately $16.4 million loss on debt extinguishment in the third quarter resulting from the repayment of approximately $140.0 million in FHLB advances and the termination of the related cash flow hedges. Salaries and benefits declined by $2.5 million, primarily due to lower incentive compensation expense and higher deferred costs related to new loan originations.  These decreases were partially offset by increases in marketing expense of approximately $1.1 million, professional fees of $955,000 related to higher consulting costs, FDIC and other insurance expenses of $873,000 primarily due to a lower FDIC small bank assessment credit earned in the fourth quarter, and OREO and credit-related expense of approximately $542,000 due to OREO valuation adjustments driven by updated appraisals received during the quarter.  

 

(1) For a reconciliation of this non-GAAP financial measure, see Alternative Performance Measures (non-GAAP) section of the Key Financial Results

 

 

INCOME TAXES

The effective tax rate for the three months ended December 31, 2019 was 16.7% compared to 16.8% for the three months ended September 30, 2019.  

BALANCE SHEET

At December 31, 2019, total assets were $17.6 billion, an increase of $122.0 million, or approximately 2.8% (annualized), from September 30, 2019, and an increase of $3.8 billion, or approximately 27.6% from December 31, 2018. The increase in assets from the previous quarter was primarily due to loan growth during the fourth quarter of 2019. The increase from the prior year was primarily a result of the Access acquisition and loan growth.

At December 31, 2019, loans held for investment (net of deferred fees and costs) were $12.6 billion, an increase of $303.9 million, or 9.9% (annualized), from September 30, 2019, while average loans increased $87.4 million, or 2.9% (annualized), from the prior quarter. Loans held for investment increased $2.9 billion, or 29.8% from December 31, 2018, while quarterly average loans increased $2.8 billion, or 29.0% from the prior year. The increase from the prior year was primarily a result of the Access acquisition.

 

At December 31, 2019, total deposits were $13.3 billion, an increase of $260.3 million, or approximately 8.0% (annualized), from September 30, 2019, while average deposits increased $490.7 million, or 15.3% (annualized), from prior quarter.  Deposits increased $3.3 billion, or 33.4% from December 31, 2018, while quarterly average deposits increased $3.4 billion, or 33.7% from the prior year. The increase from the prior year was primarily a result of the Access acquisition.

The following table shows the Company’s capital ratios at the quarters ended:

 

During the fourth quarter of 2019, the Company declared and paid cash dividends of $0.25 per common share, consistent with the third quarter of 2019 and an increase of $0.02, or 8.7% compared to the fourth quarter of 2018. On July 10, 2019, the Company announced that its Board of Directors has authorized a share repurchase program to purchase up to $150 million of the Company’s common stock through June 30, 2021 in open market transactions or privately negotiated transactions. As of December 31, 2019, authority remained to repurchase approximately $70 million of the Company’s common stock.

ABOUT ATLANTIC UNION BANKSHARES CORPORATION

Headquartered in Richmond, Virginia, Atlantic Union Bankshares Corporation (Nasdaq: AUB) is the holding company for Atlantic Union Bank. Atlantic Union Bank has 149 branches and approximately 170 ATMs located throughout Virginia, and in portions of Maryland and North Carolina. Middleburg Financial is a brand name used by Atlantic Union Bank and certain affiliates when providing trust, wealth management, private banking, and investment advisory products and services. Certain non-bank affiliates of Atlantic Union Bank include: Old Dominion Capital Management, Inc., and its subsidiary, Outfitter Advisors, Ltd., Dixon, Hubard, Feinour, & Brown, Inc., and Middleburg Investment Services, LLC, which provide investment advisory and/or brokerage services; and Union Insurance Group, LLC, which offers various lines of insurance products.

FOURTH QUARTER AND FULL YEAR 2019 EARNINGS RELEASE CONFERENCE CALL

Atlantic Union Bank will hold a conference call on Tuesday,  January 21, 2020 at 9:00 a.m. Eastern Time during which management will review the fourth quarter and full year 2019 financial results and provide an update on recent activities. Interested parties may participate in the call toll-free by dialing (877) 668‑4908; international callers wishing to participate may do so by dialing (973) 453‑3058. The conference ID number is 2394624.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

NON-GAAP FINANCIAL MEASURES

In reporting the results of the quarter and full year ended December 31, 2019, the Company has provided supplemental performance measures on a tax-equivalent, tangible, or operating basis.  These non-GAAP financial measures are a

supplement to GAAP, which is used to prepare the Company’s financial statements, and should not be considered in isolation or as a substitute for comparable measures calculated in accordance with GAAP.  In addition, the Company’s non-GAAP financial measures may not be comparable to non-GAAP financial measures of other companies.  The Company uses the non-GAAP financial measures discussed herein in its analysis of the Company’s performance. The Company’s management believes that these non-GAAP financial measures provide additional understanding of ongoing operations, enhance comparability of results of operations with prior periods and show the effects of significant gains and charges in the periods presented without the impact of items or events that may obscure trends in the Company’s underlying performance.  For a reconciliation of these measures to their most directly comparable GAAP measures and additional information about these non-GAAP financial measures, see Alternative Performance Measures (non-GAAP) section of the Key Financial Results.

FORWARD-LOOKING STATEMENTS

Certain statements in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements include, without limitation, projections, predictions, expectations, or beliefs about future events or results that are not statements of historical fact. Such forward-looking statements are based on various assumptions as of the time they are made, and are inherently subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those expressed or implied by such forward-looking statements.  Forward-looking statements are often accompanied by words that convey projected future events or outcomes such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” “intend,” “will,” “may,” “view,” “opportunity,” “potential,” or words of similar meaning or other statements concerning opinions or judgment of the Company and its management about future events.  Although the Company believes that its expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of its existing knowledge of its business and operations, there can be no assurance that actual results, performance, or achievements of, or trends affecting, the Company will not differ materially from any projected future results, performance, or achievements expressed or implied by such forward-looking statements.  Actual future results, performance, achievements or trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to:

Please refer to the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Annual Report on Form 10‑K for the year ended December 31, 2018 and comparable “Risk Factors” sections of the Company’s Quarterly Reports on Form 10‑Q and related disclosures in other filings, which have been filed with the SEC and are available on the SEC’s website at www.sec.gov. All of the forward-looking statements made in this press release are expressly qualified by the cautionary statements contained or referred to herein. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on the Company or its businesses or operations. Readers are cautioned not to rely too heavily on the forward-looking statements contained in this press release. Forward-looking statements speak only as of the date they are made and the Company does not undertake any obligation to update, revise or clarify these forward-looking statements, whether as a result of new information, future events or otherwise.

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

KEY FINANCIAL RESULTS

(Dollars in thousands, except share data)