UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q



☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2024

OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-39325

ATLANTIC UNION BANKSHARES CORPORATION

(Exact name of registrant as specified in its charter)


Virginia	54-1598552
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

4300 Cox Road

Glen Allen, Virginia 23060

(Address of principal executive offices) (Zip Code)

(804) 633-5031

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, par value $1.33 per share	AUB	The New York Stock Exchange
Depositary Shares, Each Representing a 1/400^th Interest in a Share of 6.875% Perpetual Non-Cumulative Preferred Stock, Series A	AUB.PRA	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐
		Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).


	Yes ☐ No ☒

The number of shares of common stock outstanding as of April 25, 2024 was 89,766,691.

Table of Contents

ATLANTIC UNION BANKSHARES CORPORATION

FORM 10-Q

INDEX


ITEM		PAGE

	PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements

	Consolidated Balance Sheets as of March 31, 2024 (unaudited) and December 31, 2023 (audited)	2

	Consolidated Statements of Income (unaudited) for the three months ended March 31, 2024 and 2023	3

	Consolidated Statements of Comprehensive Income (Loss) (unaudited) for the three months ended March 31, 2024 and 2023	4

	Consolidated Statements of Changes in Stockholders’ Equity (unaudited) for the three months ended March 31, 2024 and 2023	5

	Consolidated Statements of Cash Flows (unaudited) for the three months ended March 31, 2024 and 2023	6

	Notes to Consolidated Financial Statements (unaudited)	8

	Report of Independent Registered Public Accounting Firm	42

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	43

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	69

Item 4.	Controls and Procedures	71

	PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	72

Item 1A.	Risk Factors	72

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	72

Item 5.	Other Information	73

Item 6.	Exhibits	74

	Signatures	75

Table of Contents

Glossary of Acronyms and Defined Terms

In this Quarterly Report on Form 10-Q, unless the context suggests otherwise, the terms “we”, “us”, and “our” refer to Atlantic Union Bankshares Corporation and its direct and indirect subsidiaries, including Atlantic Union Bank.


2023 Form 10-K	–	Annual Report on Form 10-K for the year ended December 31, 2023
ACL	–	Allowance for credit losses
AFS	–	Available for sale
ALCO	–	Asset liability management committee
ALLL	–	Allowance for loan and lease losses, a component of ACL
American National	–	American National Bankshares Inc.
AOCI	–	Accumulated other comprehensive income (loss)
ASC	–	Accounting Standards Codification
ASU	–	Accounting Standards Update
AUB	–	Atlantic Union Bankshares Corporation
the Bank	–	Atlantic Union Bank
BOLI	–	Bank-owned life insurance
bps	–	Basis points
BTFP	–	Bank Term Funding Program
CECL	–	Current expected credit losses
CFPB	–	Consumer Financial Protection Bureau
CME SOFR	–	Chicago Mercantile Exchange Secured Overnight Financing Rate
the Company	–	Atlantic Union Bankshares Corporation and its subsidiaries
depositary shares	–	Depositary shares, each representing a 1/400th ownership interest in a share of the Company’s Series A preferred stock, with a liquidation preference of $10,000 per share of Series A preferred stock (equivalent to $25 per depositary share)
EPS	–	Earnings per common share
Exchange Act	–	Securities Exchange Act of 1934, as amended
FASB	–	Financial Accounting Standards Board
FDIC	–	Federal Deposit Insurance Corporation
Federal Reserve	–	Board of Governors of the Federal Reserve System
FHLB	–	Federal Home Loan Bank of Atlanta
FHLMC	–	Federal Home Loan Mortgage Corporation
FNB	–	FNB Corporation
FNMA	–	Federal National Mortgage Association
FOMC	–	Federal Open Market Committee
FRB	–	Federal Reserve Bank of Richmond
FR Y9-C	–	Consolidated financial statements for a U.S. bank holding company, a savings and loan holding company, a U.S. intermediate holding company, and a securities holding company
FTE	–	Fully taxable equivalent
GAAP	–	Accounting principles generally accepted in the United States
GNMA	–	Government National Mortgage Association
HTM	–	Held to maturity
LHFI	–	Loans held for investment
LHFS	–	Loans held for sale
MBS	–	Mortgage-Backed Securities
merger agreement	–	Agreement and Plan of Merger dated July 24, 2023 by and between Atlantic Union Bankshares Corporation and American National Bankshares Inc.
merger	–	Proposed merger of American National Bankshares Inc. with and into Atlantic Union Bankshares Corporation pursuant to the merger agreement
MFC	–	Middleburg Financial Corporation
NPA	–	Nonperforming assets

Table of Contents

NYSE	–	New York Stock Exchange
OCI	–	Other comprehensive (loss) income
ROU asset	–	Right of Use Asset
RPAs	–	Risk Participation Agreements
SEC	–	Securities and Exchange Commission
Series A preferred stock	–	6.875% Perpetual Non-Cumulative Preferred Stock, Series A, par value $10.00 per share
SOFR	–	Secured Overnight Financing Rate
TLM	–	Troubled loan modification
VFG	–	Virginia Financial Group, Inc.

Table of Contents

PART I – FINANCIAL INFORMATION

ITEM 1 – FINANCIAL STATEMENTS

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2024 AND DECEMBER 31, 2023

(Dollars in thousands, except share data)


	March 31,		December 31,
	2024		2023
ASSETS		(unaudited)		(audited)
Cash and cash equivalents:
Cash and due from banks	$	168,850	$	196,754
Interest-bearing deposits in other banks		225,386		167,601
Federal funds sold		2,434		13,776
Total cash and cash equivalents		396,670		378,131
Securities available for sale, at fair value		2,202,216		2,231,261
Securities held to maturity, at carrying value		828,928		837,378
Restricted stock, at cost		110,272		115,472
Loans held for sale		12,200		6,710
Loans held for investment, net of deferred fees and costs		15,851,628		15,635,043
Less: allowance for loan and lease losses		136,190		132,182
Total loans held for investment, net		15,715,438		15,502,861
Premises and equipment, net		90,126		90,959
Goodwill		925,211		925,211
Amortizable intangibles, net		17,288		19,183
Bank owned life insurance		455,885		452,565
Other assets		623,886		606,466
Total assets	$	21,378,120	$	21,166,197
LIABILITIES
Noninterest-bearing demand deposits	$	3,845,191	$	3,963,181
Interest-bearing deposits		13,433,244		12,854,948
Total deposits		17,278,435		16,818,129
Securities sold under agreements to repurchase		66,405		110,833
Other short-term borrowings		600,000		810,000
Long-term borrowings		391,319		391,025
Other liabilities		493,033		479,883
Total liabilities		18,829,192		18,609,870
Commitments and contingencies (Note 7)
STOCKHOLDERS' EQUITY
Preferred stock, $10.00 par value		173		173
Common stock, $1.33 par value		99,399		99,147
Additional paid-in capital		1,782,809		1,782,286
Retained earnings		1,040,845		1,018,070
Accumulated other comprehensive loss		(374,298)		(343,349)
Total stockholders' equity		2,548,928		2,556,327
Total liabilities and stockholders' equity	$	21,378,120	$	21,166,197

Common shares outstanding		75,381,740		75,023,327
Common shares authorized		200,000,000		200,000,000
Preferred shares outstanding		17,250		17,250
Preferred shares authorized		500,000		500,000

See accompanying notes to consolidated financial statements.

-2-

Table of Contents

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

THREE MONTHS ENDED MARCH 31, 2024 AND 2023

(Dollars in thousands, except share and per share data)


	Three Months Ended
	March 31,		March 31,
	2024		2023
Interest and dividend income:
Interest and fees on loans	$	234,600	$	189,992
Interest on deposits in other banks		1,280		1,493
Interest and dividends on securities:
Taxable		18,879		16,753
Nontaxable		8,156		9,308
Total interest and dividend income		262,915		217,546
Interest expense:
Interest on deposits		101,864		51,834
Interest on short-term borrowings		8,161		7,563
Interest on long-term borrowings		5,065		4,706
Total interest expense		115,090		64,103
Net interest income		147,825		153,443
Provision for credit losses		8,239		11,850
Net interest income after provision for credit losses		139,586		141,593
Noninterest income:
Service charges on deposit accounts		8,569		7,902
Other service charges, commissions and fees		1,731		1,746
Interchange fees		2,294		2,325
Fiduciary and asset management fees		4,838		4,262
Mortgage banking income		867		854
Gain (loss) on sale of securities		3		(13,400)
Bank owned life insurance income		3,245		2,828
Loan-related interest rate swap fees		1,216		1,439
Other operating income		2,789		1,672
Total noninterest income		25,552		9,628
Noninterest expenses:
Salaries and benefits		61,882		60,529
Occupancy expenses		6,625		6,356
Furniture and equipment expenses		3,309		3,752
Technology and data processing		8,127		8,142
Professional services		3,081		3,413
Marketing and advertising expense		2,318		2,351
FDIC assessment premiums and other insurance		5,143		3,899
Franchise and other taxes		4,501		4,498
Loan-related expenses		1,323		1,552
Amortization of intangible assets		1,895		2,279
Other expenses		7,069		11,503
Total noninterest expenses		105,273		108,274
Income before income taxes		59,865		42,947
Income tax expense		10,096		7,294
Net Income	$	49,769	$	35,653
Dividends on preferred stock		2,967		2,967
Net income available to common shareholders		46,802		32,686

Basic earnings per common share	$	0.62	$	0.44
Diluted earnings per common share	$	0.62	$	0.44
Dividends declared per common share	$	0.32	$	0.30
Basic weighted average number of common shares outstanding		75,197,113		74,832,141
Diluted weighted average number of common shares outstanding		75,197,376		74,835,514

See accompanying notes to consolidated financial statements.

-3-

Table of Contents

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (UNAUDITED)

THREE MONTHS ENDED MARCH 31, 2024 AND 2023

(Dollars in thousands)


	Three Months Ended
	March 31,
	2024		2023
Net income	$	49,769	$	35,653
Other comprehensive (loss) income:
Cash flow hedges:
Change in fair value of cash flow hedges (net of tax, $2,726 and $3,645 for the three months ended March 31, 2024 and 2023, respectively)		(10,253)		13,714
AFS securities:
Unrealized holding (losses) gains arising during period (net of tax, $5,450 and $8,525 for the three months ended March 31, 2024 and 2023, respectively)		(20,501)		32,068
Reclassification adjustment for (gains) losses included in net income (net of tax, $1 and $2,814 for the three months ended March 31, 2024 and 2023, respectively) ⁽¹⁾		(2)		10,586
HTM securities:
Reclassification adjustment for accretion of unrealized gain on AFS securities transferred to HTM (net of tax) ⁽²⁾		(2)		(3)
Bank owned life insurance:
Unrealized holding (losses) gains arising during the period (net of tax)		(16)		10
Reclassification adjustment for gains included in net income ⁽³⁾		(175)		(22)
Other comprehensive (loss) income:		(30,949)		56,353
Comprehensive income	$	18,820	$	92,006

⁽¹⁾ The gross amounts reclassified into earnings are reported as "Other operating income" on the Company’s Consolidated Statements of Income with the corresponding income tax effect being reflected as a component of income tax expense.

⁽²⁾ The gross amounts reclassified into earnings are reported within interest income on the Company’s Consolidated Statements of Income with the corresponding income tax effect being reflected as a component of income tax expense.

⁽³⁾ Reclassifications in earnings are reported in "Salaries and benefits" expense on the Company’s Consolidated Statements of Income.

See accompanying notes to consolidated financial statements.

-4-

Table of Contents

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED)

THREE MONTHS ENDED MARCH 31, 2024 AND 2023

(Dollars in thousands, except share and per share amounts)

Accumulated

Additional

Other

Common

Preferred

Paid-In

Retained

Comprehensive

Stock

Capital

Earnings

Income (Loss)

Total

Balance - December 31, 2023

99,147

173

1,782,286

1,018,070

(343,349)

2,556,327

Net Income

49,769

Other comprehensive income (net of taxes of $8,182)

(30,949)

Dividends on common stock ($0.32 per share)

(24,027)

Dividends on preferred stock ($171.88 per share)

(2,967)

Issuance of common stock under Equity Compensation Plans, stock issuance for services rendered, and vesting of restricted stock, net of shares held for taxes (189,503 shares)

252

(2,458)

(2,206)

Stock-based compensation expense

2,981

Balance - March 31, 2024

99,399

173

1,782,809

1,040,845

(374,298)

2,548,928


									Accumulated
					Additional				Other
	Common		Preferred		Paid-In		Retained		Comprehensive
	Stock		Stock		Capital		Earnings		Income (Loss)		Total
Balance - December 31, 2022	$	98,873	$	173	$	1,772,440	$	919,537	$	(418,286)	$	2,372,737
Net Income								35,653				35,653
Other comprehensive income (net of taxes of $14,983)										56,353		56,353
Dividends on common stock ($0.30 per share)								(22,417)				(22,417)
Dividends on preferred stock ($171.88 per share)								(2,967)				(2,967)
Issuance of common stock under Equity Compensation Plans, stock issuance for services rendered, and vesting of restricted stock, net of shares held for taxes (149,684 shares)		199				(1,654)						(1,455)
Stock-based compensation expense						2,332						2,332
Balance - March 31, 2023	$	99,072	$	173	$	1,773,118	$	929,806	$	(361,933)	$	2,440,236

See accompanying notes to consolidated financial statements.

-5-

Table of Contents

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

THREE MONTHS ENDED MARCH 31, 2024 AND 2023

(Dollars in thousands)


	2024		2023
Operating activities:
Net income	$	49,769	$	35,653
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses		8,239		11,850
Depreciation of premises and equipment		2,961		3,427
Amortization, net		6,542		6,417
Amortization related to acquisitions, net		2,869		1,288
(Gains) losses on securities sales, net		(3)		13,400
BOLI income		(3,245)		(2,828)
Writedown of ROU assets, foreclosed properties, and equipment		—		112
Loans held for sale:
Originations and purchases		(41,244)		(286,526)
Proceeds from sales		35,770		283,316
Changes in operating assets and liabilities:
Net (increase) decrease in other assets		(11,368)		18,840
Net increase (decrease) in other liabilities		6,721		(22,441)
Net cash provided by operating activities		57,011		62,508
Investing activities:
Securities available for sale and restricted stock:
Purchases		(115,674)		(45,633)
Proceeds from sales		61,943		558,466
Proceeds from maturities, calls, and paydowns		60,985		47,338
Securities held to maturity:
Purchases		—		(13,826)
Proceeds from maturities, calls, and paydowns		7,374		5,218
Net change in other investments		(6,724)		(2,941)
Net increase in LHFI		(220,677)		(145,260)
Net purchases of premises and equipment		(2,124)		(1,624)
Proceeds from BOLI settlements		—		353
Proceeds from sales of foreclosed properties and former bank premises		—		533
Net cash (used in) provided by investing activities		(214,897)		402,624
Financing activities:
Net increase (decrease) in:
Non-interest-bearing deposits		(117,990)		(305,230)
Interest-bearing deposits		578,294		829,449
Short-term borrowings		(254,428)		(910,077)
Common stock:
Issuance		227		474
Dividends paid		(26,994)		(25,384)
Vesting of restricted stock, net of shares held for taxes		(2,684)		(2,116)
Net cash provided by (used in) financing activities		176,425		(412,884)
Increase in cash and cash equivalents		18,539		52,248
Cash, cash equivalents and restricted cash at beginning of the period		378,131		319,948
Cash, cash equivalents and restricted cash at end of the period	$	396,670	$	372,196

-6-

Table of Contents

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

THREE MONTHS ENDED MARCH 31, 2024 AND 2023

(Dollars in thousands)


	2024		2023
Supplemental Disclosure of Cash Flow Information
Cash payments for:
Interest	$	109,148	$	58,678

Supplemental schedule of noncash investing and financing activities
Transfer from LHFI to LHFS		—		7,087

See accompanying notes to consolidated financial statements.

-7-

Table of Contents

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Unaudited)

1.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company

Headquartered in Richmond, Virginia, Atlantic Union Bankshares Corporation (NYSE: AUB) is the holding company for Atlantic Union Bank, which provides banking and related financial products and services to consumers and businesses.

Basis of Financial Information

The accounting policies and practices of Atlantic Union Bankshares Corporation and subsidiaries conform to GAAP and follow general practices within the banking industry. The consolidated financial statements include the accounts of the Company, which is a financial holding company and a bank holding company that owns all of the outstanding common stock of its banking subsidiary, Atlantic Union Bank, which owns Union Insurance Group, LLC, Atlantic Union Financial Consultants, LLC, and Atlantic Union Equipment Finance, Inc.

The unaudited consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. The preparation of the unaudited consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the ACL and the fair value of financial instruments. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other period.

The unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s 2023 Form 10-K. Certain prior period amounts have been reclassified to conform to current period presentation. None of these reclassifications had a material effect on the Company’s financial statements. See Note 1 “Summary of Significant Accounting Policies” in the “Notes to the Consolidated Financial Statements” contained in Item 8 “Financial Statements and Supplementary Data” in the Company’s 2023 Form 10-K for additional information on the Company’s accounting policies. There have not been any significant changes to the Company’s accounting policies from those disclosed in the Company’s 2023 Form 10-K that could have a material effect on the Company’s financial statements.

-8-

Table of Contents

2. SECURITIES AND OTHER INVESTMENTS

Available for Sale

The amortized cost, gross unrealized gains and losses, and estimated fair values of AFS securities for the periods ended are as follows (dollars in thousands):

Amortized

Gross Unrealized

Estimated

Cost

Gains

(Losses)

Fair Value

March 31, 2024

U.S. government and agency securities

62,561

208

(33)

62,736

Obligations of states and political subdivisions

585,749

(123,913)

461,850

Corporate and other bonds ⁽¹⁾