Atlantic Union Bankshares Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

SEGMENT REPORTING AND REVENUE (Tables)

SEGMENT REPORTING AND REVENUE (Tables)

9 Months Ended

Sep. 30, 2023

Revenue from Contract with Customer [Abstract]

The following tables present the Company’s operating segment results for the three months and nine months ended September 30, 2023 and 2022 (dollars in thousands):


	Wholesale Banking		Consumer Banking		Corporate Other ⁽¹⁾		Total
Three Months Ended September 30, 2023
Net interest income	$	68,049	$	63,912	$	19,980	$	151,941
Provision for credit losses		9,310		(4,319)		—		4,991
Net interest income after provision for credit losses		58,739		68,231		19,980		146,950
Noninterest income		9,468		13,722		3,904		27,094
Noninterest expenses		40,039		54,994		13,475		108,508
Income before income taxes	$	28,168	$	26,959	$	10,409	$	65,536
Three Months Ended September 30, 2022 ⁽²⁾
Net interest income	$	77,625	$	58,749	$	14,341	$	150,715
Provision for credit losses		8,470		(2,058)		—		6,412
Net interest income after provision for credit losses		69,155		60,807		14,341		144,303
Noninterest income		8,453		11,939		5,192		25,584
Noninterest expenses		40,164		54,740		5,019		99,923
Income before income taxes	$	37,444	$	18,006	$	14,514	$	69,964



	Wholesale Banking		Consumer Banking		Corporate Other ⁽¹⁾		Total
Nine Months Ended September 30, 2023
Net interest income	$	201,722	$	190,806	$	64,941	$	457,469
Provision for credit losses		25,853		(2,947)		5		22,911
Net interest income after provision for credit losses		175,869		193,753		64,936		434,558
Noninterest income		25,743		38,188		(3,013)		60,918
Noninterest expenses		123,207		168,971		30,264		322,442
Income before income taxes	$	78,405	$	62,970	$	31,659	$	173,034
Nine Months Ended September 30, 2022 ⁽²⁾
Net interest income	$	221,979	$	157,918	$	40,516	$	420,413
Provision for credit losses		12,844		(100)		27		12,771
Net interest income after provision for credit losses		209,135		158,018		40,489		407,642
Noninterest income		25,967		45,135		22,921		94,023
Noninterest expenses		118,216		165,523		20,273		304,012
Income before income taxes	$	116,886	$	37,630	$	43,137	$	197,653

⁽¹⁾ For the three and nine months ended September 30, 2023, noninterest expenses include $8.7 million ($8.7 million included within other expenses and ($67,000) included within salaries and benefits) and $12.6 million ($9.8 million included within other expenses and $2.8 million included within salaries and benefits), respectively, in expenses associated with strategic cost saving initiatives, principally composed of severance costs related to headcount reductions, costs related to modifying certain third-party vendor contracts, and charges for exiting certain leases.

⁽²⁾ As discussed above, the segment operating results for the three and nine months ended September 30, 2022 include a reallocation from Consumer Banking to Wholesale Banking.

Schedule of operating segment results - balance sheet metrics

The following table presents the Company’s operating segment results for key balance sheet metrics as of September 30, 2023 and December 31, 2022 (dollars in thousands):


	Wholesale Banking		Consumer Banking		Corporate Other		Total
As of September 30, 2023
LHFI, net of deferred fees and costs ⁽¹⁾	$	12,343,799	$	2,953,367	$	(13,546)	$	15,283,620
Goodwill		639,180		286,031		—		925,211
Deposits		6,537,472		9,726,079		522,954		16,786,505
As of December 31, 2022
LHFI, net of deferred fees and costs ⁽¹⁾⁽²⁾	$	11,476,258	$	2,990,017	$	(17,133)	$	14,449,142
Goodwill ⁽³⁾		639,180		286,031		—		925,211
Deposits ⁽⁴⁾		6,128,729		9,724,598		78,350		15,931,677

⁽¹⁾Corporate Other includes acquisition accounting fair value adjustments.

⁽²⁾Wholesale Banking includes a $136.6 million reallocation from Consumer Banking due to the January 1, 2023 organizational change discussed above.

⁽³⁾Wholesale Banking includes a $9.6 million reallocation from Consumer Banking due to the January 1, 2023 organizational change discussed above.

⁽⁴⁾Wholesale Banking includes a $258.7 million reallocation from Consumer Banking due to the January 1, 2023 organizational change discussed above.

Schedule of Disaggregation of Revenue

Noninterest income disaggregated by major source for the three and nine months ended September 30, 2023 and 2022, consisted of the following (dollars in thousands):


	Three Months Ended				Nine Months Ended
	September 30,		September 30,		September 30,		September 30,
	2023		2022		2023		2022
Noninterest income:
Deposit Service Charges ⁽¹⁾:
Overdraft fees	$	5,210	$	3,831	$	14,873	$	14,130
Maintenance fees & other		3,347		2,953		9,704		8,291
Other service charges, commissions, and fees ⁽¹⁾		2,632		1,770		6,071		5,134
Interchange fees⁽¹⁾		2,314		2,461		7,098		6,539
Fiduciary and asset management fees ⁽¹⁾:
Trust asset management fees		3,120		3,035		9,329		9,726
Registered advisor management fees		—		—		—		5,088
Brokerage management fees		1,429		1,099		3,840		3,515
Mortgage banking income		666		1,390		1,969		6,707
Loss on sale of securities		(27,594)		—		(40,992)		(2)
Bank owned life insurance income		2,973		3,445		8,671		8,858
Loan-related interest rate swap fees		2,695		2,050		6,450		8,510
Other operating income ⁽²⁾		30,302		3,550		33,905		17,527
Total noninterest income	$	27,094	$	25,584	$	60,918	$	94,023

⁽¹⁾ Income within scope of ASC 606, Revenue from Contracts with Customers.

⁽²⁾ Includes a $27.7 million gain related to the sale-leaseback transaction for the three and nine months ended September 30, 2023, and a $9.1 million gain related to the sale of DHFB for the nine months ended September 30, 2022.

Disaggregated noninterest income by segment

The following tables present noninterest income disaggregated by reportable operating segment for the three and nine months ended September 30, 2023 and 2022 (dollars in thousands):


	Wholesale Banking		Consumer Banking		Corporate Other ⁽¹⁾⁽²⁾		Total
Three Months Ended September 30, 2023
Noninterest income:
Deposit service charges	$	2,184	$	6,373	$	—	$	8,557
Other service charges and fees		399		2,233		—		2,632
Fiduciary and asset management fees		3,050		1,499		—		4,549
Mortgage banking income		—		666		—		666
Other income		3,835		2,951		3,904		10,690
Total noninterest income	$	9,468	$	13,722	$	3,904	$	27,094
Three Months Ended September 30, 2022 ⁽³⁾
Noninterest income:
Deposit service charges	$	1,783	$	5,001	$	—	$	6,784
Other service charges and fees		513		1,257		—		1,770
Fiduciary and asset management fees		2,960		1,174		—		4,134
Mortgage banking income		—		1,390		—		1,390
Other income		3,197		3,117		5,192		11,506
Total noninterest income	$	8,453	$	11,939	$	5,192	$	25,584



	Wholesale Banking		Consumer Banking		Corporate Other ⁽¹⁾⁽²⁾		Total
Nine Months Ended September 30, 2023
Noninterest income:
Deposit service charges	$	6,268	$	18,309	$	—	$	24,577
Other service charges and fees		1,140		4,931		—		6,071
Fiduciary and asset management fees		9,118		4,051		—		13,169
Mortgage banking income		—		1,969		—		1,969
Other income		9,217		8,928		(3,013)		15,132
Total noninterest income	$	25,743	$	38,188	$	(3,013)	$	60,918
Nine Months Ended September 30, 2022 ⁽³⁾
Noninterest income:
Deposit service charges	$	4,990	$	17,431	$	—	$	22,421
Other service charges and fees		1,342		3,792		—		5,134
Fiduciary and asset management fees		9,501		8,828		—		18,329
Mortgage banking income		—		6,707		—		6,707
Other income		10,134		8,377		22,921		41,432
Total noninterest income	$	25,967	$	45,135	$	22,921	$	94,023

⁽¹⁾ For the three and nine months ended September 30, 2022, other income primarily includes a $9.1 million gain related to the sale of DHFB and income from BOLI.

⁽²⁾ For the three and nine months ended September 30, 2023, other income primarily includes a $27.7 million gain related to the sale-leaseback transaction, losses incurred on the sale of AFS securities ($27.6 million and $41.0 million, respectively), and income from BOLI.

⁽³⁾ As discussed above, noninterest income for the three and nine months ended September 30, 2022 includes a reallocation from Consumer Banking to Wholesale Banking.