Atlantic Union Bankshares (AUB) Q1 2025 earnings summary

Executive summary

• Closed the Sandy Spring Bancorp acquisition on April 1, 2025, ahead of schedule, adding 53 branches and expanding presence in Virginia and Maryland, accelerating integration and cost savings initiatives.

• Pro forma assets reached $38.4 billion, making the bank the largest regional bank in the Mid-Atlantic, Maryland, and Virginia.

• Delivered Q1 2025 net income available to common shareholders of $46.9 million and adjusted operating earnings of $51.6 million.

• Net interest margin expanded to 3.38% (GAAP) and 3.45% (FTE), with deposit and loan growth despite economic uncertainty.

• Asset quality remained solid with negligible net charge-offs, but loan loss reserves were increased due to macroeconomic uncertainty.

Financial highlights

• Net interest income was $184.2 million, up $0.9 million sequentially and $36.3 million year-over-year; net interest margin (FTE) was 3.45%, up 12 bps sequentially.

• Noninterest income decreased by $6 million to $29.2 million, mainly due to lower swap fees and investment income.

• Noninterest expense rose $4.5 million to $134.2 million, driven by higher salaries, benefits, technology costs, and merger-related expenses.

• Provision for credit losses was $17.6 million, reflecting increased economic uncertainty.

• Basic and diluted EPS were $0.53 and $0.52, respectively; adjusted diluted operating EPS was $0.57.

Outlook and guidance

• 2025 outlook includes Sandy Spring impact: year-end loans projected at $28–$29 billion, deposits at $31–$32 billion.

• Net interest income expected between $1.15–$1.25 billion; net interest margin projected at 3.75–4%.

• Allowance for credit losses to loans expected at 1.2–1.3%; net charge-off ratio forecasted at 15–25 basis points.

• Assumes three Fed rate cuts in 2025 and no recession, with unemployment in core markets below national average.

• Management expects to close the sale of approximately $2.0 billion of CRE loans by June 30, 2025.