EX-99.1 2 umbf-ex99_1.htm EX-99.1

Exhibit 99.1

UMB Financial Corporation News Release

1010 Grand Boulevard

Kansas City, MO 64106

816.860.7000

umb.com

//FOR IMMEDIATE RELEASE//

Media Contact: Stephanie Hague: 816.860.5088

Investor Relations Contact: Kay Gregory: 816.860.7106

UMB Financial Corp Reports Fourth Quarter Net Income of $70.9 Million, or $1.45 Per Diluted Share & Net Operating Income of $112.0 Million, or $2.29 Per Diluted Share.

Full-Year 2023 Earnings of $350.0 Million; Net Operating Income of $397.1 Million.

Fourth Quarter 2023 Financial Highlights

•
GAAP net income of $70.9 million, or $1.45 per diluted share.
•
Net operating income(i) of $112.0 million, or $2.29 per diluted share.
•
Average loans increased 6.3% on a linked-quarter, annualized basis, to $23.1 billion.
•
Average loans increased $2.8 billion, or 13.9%, as compared to the fourth quarter of 2022.
•
Average deposits increased 17.2% on a linked-quarter, annualized basis, to $32.7 billion.
•
Net interest income increased 3.7% from the linked quarter.
•
Noninterest income increased 11.8% from the fourth quarter of 2022, equal to 37.8% of total revenue.
•
Net interest margin was 2.46%, an increase of three basis points from the linked quarter.
•
Credit quality remained strong, with net charge-offs of just 0.02% of average loans.

KANSAS CITY, Mo. (January 30, 2024) – UMB Financial Corporation (Nasdaq: UMBF), a financial services company, announced net income for the fourth quarter of 2023 of $70.9 million, or $1.45 per diluted share, compared to $96.6 million, or $1.98 per diluted share, in the third quarter of 2023 (linked quarter) and $100.2 million, or $2.06 per diluted share, in the fourth quarter of 2022. The results for the fourth quarter of 2023 include a pre-tax expense of $52.8 million for the industry-wide FDIC special assessment.

Net operating income, a non-GAAP financial measure reconciled later in this release to net income, the nearest comparable GAAP measure, was $112.0 million, or $2.29 per diluted share, for the fourth quarter of 2023, compared to $98.4 million, or $2.02 per diluted share, for the linked quarter and $101.1 million, or $2.07 per diluted share, for the fourth quarter of 2022. Operating pre-tax, pre-provision income (operating PTPP), a non-GAAP measure reconciled later in this release to the components of net income before taxes, the nearest comparable GAAP measure, was $134.9 million, or $2.76 per diluted share, for the fourth quarter of 2023, compared to $126.6 million, or $2.60 per diluted share, for the linked quarter, and $134.1 million, or $2.75 per diluted share, for the fourth quarter of 2022. These operating PTPP results represent increases of 6.6% on a linked-quarter basis and 0.6% compared to the fourth quarter of 2022.

“We closed 2023 with strong fourth quarter performance, demonstrating the power and resilience of our diversified business model. Results were accentuated by continued loan and deposit growth, expanding net interest margin and net interest income, solid fee income growth and exceptional asset quality,” said Mariner Kemper, chairman, president and chief executive officer. “Our strong business performance and

financial results were unfortunately muted by our share of the FDIC special assessment levied on banks to recoup the losses related to two of the bank failures in March 2023. I am incredibly proud of our associates who drove this performance, and deeply grateful for our loyal client base that grew with us through the much-exaggerated industry noise following the bank failures. While this was a challenging time for the industry, it was extremely rewarding to see how our company and customers came together to support each other, and the resulting positive growth and performance.”

Mr. Kemper continued, “Key highlights from our fourth quarter results included a 3.7% increase in net interest income from the linked quarter, facilitated by a 6.3% annualized increase in average loans, three basis points of net interest margin expansion, a 4.3% linked-quarter increase in average deposits, a 5.2% increase in fee income, and just 0.02% in net charge-offs. At December 31, 2023, our total deposits – which we describe as our raw material for growth – increased $3.2 billion to $35.8 billion compared to year-end 2022, and were $2.4 billion above September 30, 2023 balances. Looking ahead into 2024, we see a muted but resilient macro-economic environment, and we remain well-positioned with an attractive average loan-to-deposit ratio of 70.7%, strong capital levels, and a high-quality loan portfolio.”

(i) A non-GAAP financial measure reconciled later in this release to net income, the nearest comparable GAAP measure.

Fourth Quarter 2023 earnings discussion

Summary of quarterly financial results |  | UMB Financial Corporation |
(unaudited, dollars in thousands, except per share data) |  |  |  |  |  |  |  |  |
|  | Q4 |  |  | Q3 |  |  | Q4 |
|  | 2023 |  |  | 2023 |  |  | 2022 |
Net income (GAAP) |  | $ | 70,923 |  |  | $ | 96,554 |  |  | $ | 100,173 |
Earnings per share - diluted (GAAP) |  |  | 1.45 |  |  |  | 1.98 |  |  |  | 2.06 |
Operating pre-tax, pre-provision income (Non-GAAP)(i) |  |  | 134,901 |  |  |  | 126,592 |  |  |  | 134,054 |
Operating pre-tax, pre-provision earnings per share - diluted (Non-GAAP)(i) |  |  | 2.76 |  |  |  | 2.60 |  |  |  | 2.75 |
Operating pre-tax, pre-provision income - FTE (Non-GAAP)(i) |  |  | 141,571 |  |  |  | 133,151 |  |  |  | 140,717 |
Operating pre-tax, pre-provision earnings per share - FTE - diluted (Non-GAAP)(i) |  |  | 2.90 |  |  |  | 2.73 |  |  |  | 2.89 |
Net operating income (Non-GAAP)(i) |  |  | 112,038 |  |  |  | 98,400 |  |  |  | 101,092 |
Operating earnings per share - diluted (Non-GAAP)(i) |  |  | 2.29 |  |  |  | 2.02 |  |  |  | 2.07 |
GAAP |  |  |  |  |  |  |  |  |
Return on average assets |  |  | 0.69 | % |  |  | 0.97 | % |  |  | 1.06 | %
Return on average equity |  |  | 9.52 |  |  |  | 13.25 |  |  |  | 15.16 |
Efficiency ratio |  |  | 77.65 |  |  |  | 64.51 |  |  |  | 63.72 |
Non-GAAP(i) |  |  |  |  |  |  |  |  |
Operating return on average assets |  |  | 1.10 | % |  |  | 0.99 | % |  |  | 1.07 | %
Operating return on average equity |  |  | 15.04 |  |  |  | 13.50 |  |  |  | 15.30 |
Operating return on average tangible equity excluding AOCI |  |  | 13.05 |  |  |  | 11.77 |  |  |  | 12.85 |
Operating efficiency ratio |  |  | 63.06 |  |  |  | 63.83 |  |  |  | 63.39 |

(i) See reconciliation of Non-GAAP measures to their nearest comparable GAAP measures later in this release.

Summary of revenue |  | UMB Financial Corporation |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Q4 |  |  | Q3 |  |  | Q4 |  |  | CQ vs. |  |  | CQ vs. |
|  | 2023 |  |  | 2023 |  |  | 2022 |  |  | LQ |  |  | PY |
Net interest income |  | $ | 230,522 |  |  | $ | 222,287 |  |  | $ | 245,166 |  |  | $ | 8,235 |  |  | $ | (14,644 | )
Noninterest income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Trust and securities processing |  |  | 66,584 |  |  |  | 66,668 |  |  |  | 59,207 |  |  |  | (84 | ) |  |  | 7,377 |
Trading and investment banking |  |  | 5,751 |  |  |  | 3,771 |  |  |  | 5,251 |  |  |  | 1,980 |  |  |  | 500 |
Service charges on deposit accounts |  |  | 21,330 |  |  |  | 21,080 |  |  |  | 19,758 |  |  |  | 250 |  |  |  | 1,572 |
Insurance fees and commissions |  |  | 238 |  |  |  | 272 |  |  |  | 459 |  |  |  | (34 | ) |  |  | (221 | )
Brokerage fees |  |  | 13,439 |  |  |  | 13,400 |  |  |  | 13,332 |  |  |  | 39 |  |  |  | 107 |
Bankcard fees |  |  | 18,672 |  |  |  | 19,296 |  |  |  | 19,597 |  |  |  | (624 | ) |  |  | (925 | )
Investment securities gains (losses), net |  |  | 1,014 |  |  |  | 271 |  |  |  | (409 | ) |  |  | 743 |  |  |  | 1,423 |
Other |  |  | 13,226 |  |  |  | 8,559 |  |  |  | 8,302 |  |  |  | 4,667 |  |  |  | 4,924 |
Total noninterest income |  | $ | 140,254 |  |  | $ | 133,317 |  |  | $ | 125,497 |  |  | $ | 6,937 |  |  | $ | 14,757 |
Total revenue |  | $ | 370,776 |  |  | $ | 355,604 |  |  | $ | 370,663 |  |  | $ | 15,172 |  |  | $ | 113 |
Net interest income (FTE) |  | $ | 237,192 |  |  | $ | 228,846 |  |  | $ | 251,829 |  |  |  |  |  |  |
Net interest margin (FTE) |  |  | 2.46 | % |  |  | 2.43 | % |  |  | 2.83 | % |  |  |  |  |  |
Total noninterest income as a % of total revenue |  |  | 37.8 |  |  |  | 37.5 |  |  |  | 33.9 |  |  |  |  |  |  |

Net interest income

•
Fourth quarter 2023 net interest income totaled $230.5 million, an increase of $8.2 million, or 3.7%, from the linked quarter, driven primarily by continued growth in average loans and higher levels of liquidity, partially offset by higher interest expense.
•
Average earning assets increased $933.7 million, or 2.5%, from the linked quarter, largely driven by an increase of $823.9 million in interest-bearing due from banks and $357.6 million in average loans, partially offset by a decrease of $179.2 million in average securities.
•
Average interest-bearing liabilities increased $777.1 million, or 3.0%, from the linked quarter, primarily driven by an increase of $1.2 billion in interest-bearing deposits, partially offset by decreases of $319.6 million in borrowed funds and $144.0 million in federal funds and repurchase agreements. Average noninterest-bearing demand deposits increased $104.1 million, or 1.0%, as compared to the linked quarter.
•
Net interest margin for the fourth quarter was 2.46%, an increase of three basis points from the linked quarter, driven by increased loan yields, the benefit of free funds, and earning asset mix changes, partially offset by the increased cost of interest-bearing liabilities. The cost of interest-bearing liabilities increased 13 basis points to 3.95%. Total cost of funds increased 12 basis points from the linked quarter to 2.87%. Both average loan yields and earning asset yields increased 13 basis points from the linked quarter.
•
On a year-over-year basis, net interest income decreased $14.6 million, or 6.0%, driven by higher interest expense primarily due to an unfavorable mix shift in the composition of liabilities, as well as the impact of higher short-term interest rates on deposit costs. This decrease was partially offset by a $2.8 billion, or 13.9%, increase in average loans as well as the benefit from higher short-term interest rates on loan pricing and yields.
•
Compared to the fourth quarter of 2022, average earning assets increased $3.0 billion, or 8.6%, largely driven by the increase in average loans noted above and an increase of $1.2 billion in interest-bearing due from banks, partially offset by a decrease of $611.9 million in average securities.

•
Average deposits increased 4.1% compared to the fourth quarter of 2022. Average noninterest-bearing demand deposit balances decreased 18.8% compared to the fourth quarter of 2022, driven by migration to rate-bearing deposit categories, as expected in a higher interest rate environment. Average demand deposit balances comprised 31.0% of total deposits, compared to 32.0% in the linked quarter and 39.7% in the fourth quarter of 2022.
•
Average borrowed funds decreased $319.6 million as compared to the linked quarter and increased $1.9 billion as compared to the fourth quarter of 2022, driven by short-term borrowings with the Federal Home Loan Bank and the Federal Reserve.

Noninterest income

•
Fourth quarter 2023 noninterest income increased $6.9 million, or 5.2%, on a linked-quarter basis, largely due to:
o
Increases of $3.7 million in company-owned life insurance income and $0.6 million in derivative income, both recorded in other income. The increase in company-owned life insurance was offset by a proportionate increase in deferred compensation expense as noted below.
o
An increase of $2.0 million in trading and investment banking due to increased trading volume.
•
Compared to the prior year, noninterest income in the fourth quarter of 2023 increased $14.8 million, or 11.8%, primarily driven by:
o
Increases of $4.9 million in fund services income, $2.0 million in corporate trust income, and $0.5 million in trust servicing income, all recorded in trust and securities processing.
o
Increases of $3.3 million in company-owned life insurance income and $0.6 million in bank-owned life insurance income, both recorded in other income. The increase in company-owned life insurance was offset by a proportionate increase in deferred compensation expense as noted below.
o
An increase of $1.6 million in service charges on deposits primarily due to increased corporate service charge income.
o
An increase of $1.4 million in investment securities gains, primarily driven by increased valuations in the company's non-marketable securities.

Noninterest expense

Summary of noninterest expense |  | UMB Financial Corporation |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Q4 |  |  | Q3 |  |  | Q4 |  |  | CQ vs. |  |  | CQ vs. |
|  | 2023 |  |  | 2023 |  |  | 2022 |  |  | LQ |  |  | PY |
Salaries and employee benefits |  | $ | 134,231 |  |  | $ | 133,380 |  |  | $ | 135,940 |  |  | $ | 851 |  |  | $ | (1,709 | )
Occupancy, net |  |  | 12,296 |  |  |  | 12,283 |  |  |  | 12,409 |  |  |  | 13 |  |  |  | (113 | )
Equipment |  |  | 16,579 |  |  |  | 17,204 |  |  |  | 18,969 |  |  |  | (625 | ) |  |  | (2,390 | )
Supplies and services |  |  | 5,546 |  |  |  | 3,213 |  |  |  | 3,697 |  |  |  | 2,333 |  |  |  | 1,849 |
Marketing and business development |  |  | 6,659 |  |  |  | 6,631 |  |  |  | 8,788 |  |  |  | 28 |  |  |  | (2,129 | )
Processing fees |  |  | 27,271 |  |  |  | 26,016 |  |  |  | 23,545 |  |  |  | 1,255 |  |  |  | 3,726 |
Legal and consulting |  |  | 8,424 |  |  |  | 7,230 |  |  |  | 10,664 |  |  |  | 1,194 |  |  |  | (2,240 | )
Bankcard |  |  | 8,677 |  |  |  | 8,852 |  |  |  | 7,369 |  |  |  | (175 | ) |  |  | 1,308 |
Amortization of other intangible assets |  |  | 2,048 |  |  |  | 2,124 |  |  |  | 1,649 |  |  |  | (76 | ) |  |  | 399 |
Regulatory fees |  |  | 59,183 |  |  |  | 6,153 |  |  |  | 4,232 |  |  |  | 53,030 |  |  |  | 54,951 |
Other |  |  | 9,060 |  |  |  | 8,355 |  |  |  | 10,556 |  |  |  | 705 |  |  |  | (1,496 | )
Total noninterest expense |  | $ | 289,974 |  |  | $ | 231,441 |  |  | $ | 237,818 |  |  | $ | 58,533 |  |  | $ | 52,156 |

•
GAAP Noninterest expense for the fourth quarter of 2023 was $290.0 million, an increase of $58.5 million, or 25.3%, from the linked quarter and an increase of $52.2 million, or 21.9% from the fourth quarter of 2022. Operating noninterest expense, a non-GAAP financial measure reconciled later in this release to noninterest expense, the nearest comparable GAAP measure, was $235.9 million for the fourth quarter of 2023, an increase of $6.9 million, or 3.0%, from the linked quarter and a decrease of $0.7 million, or 0.3%, from the fourth quarter of 2022.
•
The linked-quarter increase in GAAP noninterest expense was driven by:
o
An increase of $53.0 million in regulatory fees expense, primarily driven by the $52.8 million FDIC special assessment in the fourth quarter of 2023.
o
An increase of $2.7 million in deferred compensation expense, recorded in salaries and employee benefits. The increase in deferred compensation expense was offset by the increase in company-owned life insurance income noted above.
o
An increase of $2.3 million in supplies driven by purchases of computers during the fourth quarter.
o
An increase of $1.5 million in charitable contribution expense, recorded in other expense.
o
An increase of $1.3 million in processing fees expense due to the ongoing modernization of the company’s core systems and the timing of multiple software projects.
o
These increases were partially offset by decreases of $1.6 million in payroll taxes, insurance, and 401(k) expense and $0.5 million in bonus and commission expense, both recorded in salaries and employee benefits.
•
The year-over-year increase in GAAP noninterest expense was driven by:
o
An increase of $55.0 million in regulatory fees, primarily driven by the $52.8 million FDIC special assessment recorded in the fourth quarter of 2023.
o
An increase of $3.7 million in processing fees expense due to the ongoing modernization of the company’s core systems and the timing of multiple software projects.
o
Increases of $2.4 million in deferred compensation expense and $0.7 million in salary and wage expense, both recorded in salaries and employee benefits. The increase in

deferred compensation expense was offset by the increase in company-owned life insurance income noted above.
o
These increases were partially offset by the following decreases:
▪
A decrease of $5.1 million in bonus and commission expense, recorded in salaries and employee benefits.
▪
A decrease of $2.4 million in equipment expense driven by reduced software expense.
▪
A decrease of $2.2 million in legal and consulting expense due to the timing of multiple projects.

Full Year 2023 earnings discussion

Net income for the year ended December 31, 2023 was $350.0 million, or $7.18 per diluted share, compared to $431.7 million, or $8.86 per diluted share in 2022. The results for 2023 include $52.8 million in pre-tax expense for the FDIC special assessment. Net operating income, a non-GAAP financial measure reconciled to net income, the nearest comparable GAAP measure, later in this release, was $397.1 million, or $8.14 per diluted share, compared to $433.0 million, or $8.88 per diluted share in 2022. The decrease in net income from the prior year was driven by the pre-tax gain of $66.2 million recognized in 2022 on the sale of the company's Visa Inc. Class B common shares. Operating PTPP, a non-GAAP financial measure reconciled later in this release to the components of net income before taxes, the nearest comparable GAAP measure, was $524.8 million, or $10.76 per diluted share, compared to $571.7 million, or $11.73 per diluted share in 2022. These results represent a decrease of 8.2% as compared to 2022.

Summary of year-to-date financial results |  | UMB Financial Corporation |
(unaudited, dollars in thousands, except per share data) |  | December |  |  | December |
|  | YTD |  |  | YTD |
|  | 2023 |  |  | 2022 |
Net income (GAAP) |  | $ | 350,024 |  |  | $ | 431,682 |
Earnings per share - diluted (GAAP) |  |  | 7.18 |  |  |  | 8.86 |
Operating pre-tax, pre-provision income (Non-GAAP)(i) |  |  | 524,791 |  |  |  | 571,671 |
Operating pre-tax, pre-provision earnings per share - diluted (Non-GAAP)(i) |  |  | 10.76 |  |  |  | 11.73 |
Operating pre-tax, pre-provision income - FTE (Non-GAAP)(i) |  |  | 551,150 |  |  |  | 597,465 |
Operating pre-tax, pre-provision earnings per share - FTE - diluted (Non-GAAP)(i) |  |  | 11.30 |  |  |  | 12.26 |
Net operating income (Non-GAAP)(i) |  |  | 397,115 |  |  |  | 433,020 |
Operating earnings per share - diluted (Non-GAAP)(i) |  |  | 8.14 |  |  |  | 8.88 |
GAAP |  |  |  |  |  |
Return on average assets |  |  | 0.88 | % |  |  | 1.15 | %
Return on average equity |  |  | 12.23 |  |  |  | 15.83 |
Efficiency ratio |  |  | 67.76 |  |  |  | 60.84 |
Non-GAAP (i) |  |  |  |  |  |
Operating return on average assets |  |  | 1.00 | % |  |  | 1.15 | %
Operating return on average equity |  |  | 13.87 |  |  |  | 15.88 |
Operating return on average tangible equity excluding AOCI |  |  | 12.17 |  |  |  | 14.38 |
Operating efficiency ratio |  |  | 63.52 |  |  |  | 60.72 |

(i) See reconciliation of Non-GAAP measures to their nearest comparable GAAP measures later in this release.

•
Net interest income increased $6.3 million, or 0.7%, year-over-year due to a $1.9 billion, or 5.3%, increase in average earning assets, coupled with the impacts from increased short-term and long-term interest rates. The increase in earning assets was driven by an increase of $3.5 billion, or 18.7%, in average loans, partially offset by decreases of $649.8 million in federal funds and resell agreements and $611.9 million in average securities from 2022. Average interest-bearing liabilities increased $4.5 billion, or 21.1%, while noninterest-bearing demand deposits decreased $2.6 billion, or 19.8%, as expected in a higher interest rate environment. The yield on earning assets increased 170 basis points, while the cost of interest-bearing liabilities increased 253 basis points. Net interest margin for 2023 was 2.52%, compared to 2.63% in 2022.
•
Full-year noninterest income decreased $12.4 million, or 2.2%, due to:
o
A decrease of $61.6 million in investment securities gains, largely driven by the gain on the sale of the company's Visa Inc. Class B common shares during the second quarter of 2022, partially offset by an increase in valuation of the company's marketable securities.
o
A decrease of $3.6 million in trading and investment banking due to decreased trading volume.
o
These decreases were offset by the following increases:
▪
Increases of $18.4 million in company-owned life insurance and $1.7 million in bank-owned life insurance income, both recorded in other income. The increase in company-owned life insurance was offset by a proportionate increase in deferred compensation expense as noted below.
▪
Increases of $12.2 million in fund services income and $7.7 million in corporate trust income, both recorded in trust and securities processing.
▪
An increase of $11.1 million in brokerage income, primarily driven by higher 12b-1 fees and money market income.
▪
An increase of $1.3 million in bankcard income, driven by increased interchange income, partially offset by increased rewards and rebates expense.
•
Full-year GAAP noninterest expense increased $101.0 million, or 11.2%, due to:
o
An increase of $61.6 million in regulatory fees, primarily driven by the $52.8 million industry-wide FDIC special assessment recorded in the fourth quarter of 2023.
o
An increase of $29.0 million in salaries and employee benefits, driven by increases of $23.8 million in salary and wage expense, $14.7 million in deferred compensation expense, and $6.5 million in payroll taxes, insurance, and 401(k) expense, partially offset by a decrease of $15.3 million in bonus and commission expense. The increase in deferred compensation expense was offset by the increase in company-owned life insurance income noted above.
o
An increase of $20.9 million in processing fees due to the ongoing modernization of the company’s core systems and the timing of multiple software projects.
o
These increases were partially offset by a decrease of $9.1 million in legal and consulting expense due to the timing of multiple projects.

Income taxes

•
The company’s effective tax rate was 17.0% for the year ended December 31, 2023, compared to 18.9% for the same period in 2022. The decrease in the effective tax rate in 2023 is primarily

attributable to a larger portion of income being earned from tax-exempt municipal securities and excludable life insurance policy gains.

Balance sheet

•
Average total assets for the fourth quarter of 2023 were $40.5 billion compared to $39.5 billion for the linked quarter and $37.3 billion for the same period in 2022.

Summary of average loans and leases - QTD Average | UMB Financial Corporation |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Q4 |  |  | Q3 |  |  | Q4 |  |  | CQ vs. |  |  | CQ vs. |
|  | 2023 |  |  | 2023 |  |  | 2022 |  |  | LQ |  |  | PY |
Commercial and industrial |  | $ | 9,825,043 |  |  | $ | 9,852,335 |  |  | $ | 8,891,356 |  |  | $ | (27,292 | ) |  | $ | 933,687 |
Specialty lending |  |  | 496,816 |  |  |  | 526,711 |  |  |  | 559,200 |  |  |  | (29,895 | ) |  |  | (62,384 | )
Commercial real estate |  |  | 8,890,057 |  |  |  | 8,545,206 |  |  |  | 7,323,877 |  |  |  | 344,851 |  |  |  | 1,566,180 |
Consumer real estate |  |  | 2,945,114 |  |  |  | 2,922,753 |  |  |  | 2,678,771 |  |  |  | 22,361 |  |  |  | 266,343 |
Consumer |  |  | 153,791 |  |  |  | 139,384 |  |  |  | 145,811 |  |  |  | 14,407 |  |  |  | 7,980 |
Credit cards |  |  | 495,502 |  |  |  | 477,904 |  |  |  | 457,043 |  |  |  | 17,598 |  |  |  | 38,459 |
Leases and other |  |  | 302,740 |  |  |  | 287,174 |  |  |  | 238,603 |  |  |  | 15,566 |  |  |  | 64,137 |
Total loans |  | $ | 23,109,063 |  |  | $ | 22,751,467 |  |  | $ | 20,294,661 |  |  | $ | 357,596 |  |  | $ | 2,814,402 |

•
Average loans for the fourth quarter of 2023 increased $357.6 million, or 1.6%, on a linked-quarter basis and $2.8 billion, or 13.9%, compared to the fourth quarter of 2022.

Summary of average securities - QTD Average |  | UMB Financial Corporation |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Q4 |  |  | Q3 |  |  | Q4 |  |  | CQ vs. |  |  | CQ vs. |
|  | 2023 |  |  | 2023 |  |  | 2022 |  |  | LQ |  |  | PY |
Securities available for sale: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury |  | $ | 859,114 |  |  | $ | 786,136 |  |  | $ | 752,339 |  |  | $ | 72,978 |  |  | $ | 106,775 |
U.S. Agencies |  |  | 169,723 |  |  |  | 172,832 |  |  |  | 171,171 |  |  |  | (3,109 | ) |  |  | (1,448 | )
Mortgage-backed |  |  | 3,466,152 |  |  |  | 3,611,305 |  |  |  | 4,027,120 |  |  |  | (145,153 | ) |  |  | (560,968 | )
State and political subdivisions |  |  | 1,218,176 |  |  |  | 1,275,591 |  |  |  | 1,353,307 |  |  |  | (57,415 | ) |  |  | (135,131 | )
Corporates |  |  | 345,634 |  |  |  | 345,026 |  |  |  | 366,131 |  |  |  | 608 |  |  |  | (20,497 | )
Collateralized loan obligations |  |  | 349,149 |  |  |  | 346,426 |  |  |  | 328,475 |  |  |  | 2,723 |  |  |  | 20,674 |
Total securities available for sale |  | $ | 6,407,948 |  |  | $ | 6,537,316 |  |  | $ | 6,998,543 |  |  | $ | (129,368 | ) |  | $ | (590,595 | )
Securities held to maturity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Agencies |  | $ | 123,195 |  |  | $ | 123,165 |  |  | $ | 123,077 |  |  | $ | 30 |  |  | $ | 118 |
Mortgage-backed |  |  | 2,756,528 |  |  |  | 2,814,467 |  |  |  | 2,983,489 |  |  |  | (57,939 | ) |  |  | (226,961 | )
State and political subdivisions |  |  | 2,825,138 |  |  |  | 2,828,029 |  |  |  | 2,765,717 |  |  |  | (2,891 | ) |  |  | 59,421 |
Total securities held to maturity |  | $ | 5,704,861 |  |  | $ | 5,765,661 |  |  | $ | 5,872,283 |  |  | $ | (60,800 | ) |  | $ | (167,422 | )
Trading securities |  | $ | 16,880 |  |  | $ | 17,327 |  |  | $ | 11,799 |  |  | $ | (447 | ) |  | $ | 5,081 |
Other securities |  |  | 456,758 |  |  |  | 445,380 |  |  |  | 315,748 |  |  |  | 11,378 |  |  |  | 141,010 |
Total securities |  | $ | 12,586,447 |  |  | $ | 12,765,684 |  |  | $ | 13,198,373 |  |  | $ | (179,237 | ) |  | $ | (611,926 | )

•
Average total securities decreased 1.4% on a linked-quarter basis and 4.6% compared to the fourth quarter of 2022.
•
At December 31, 2023, the unrealized pre-tax net loss on the available-for-sale securities portfolio was $624.2 million, or 8.1% of the $7.7 billion amortized cost balance. At December 31, 2023, the unrealized pre-tax net loss on the securities designated as held to maturity was $508.5 million, or 8.9% of the $5.7 billion amortized cost value.
•
During 2022, the company transferred securities with an amortized cost balance of $4.1 billion and a fair value of $3.8 billion from the available-for-sale category to the held-to-maturity

category. The remaining balance of unrealized pre-tax net losses related to transferred securities was $207.2 million as of December 31, 2023 and was included in the amortized cost balance of held-to-maturity securities.
•
At December 31, 2023, an after-tax gain of $55.0 million was included in accumulated other comprehensive income (AOCI) related to the company’s fair value hedges of municipal securities. During 2021, the company entered into ten of these hedge transactions, all of which have since been terminated. The gain on the terminated hedges is being amortized over the remaining life of the underlying bonds.

Summary of average deposits - QTD Average | UMB Financial Corporation |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Q4 |  |  | Q3 |  |  | Q4 |  |  | CQ vs. |  |  | CQ vs. |
|  | 2023 |  |  | 2023 |  |  | 2022 |  |  | LQ |  |  | PY |
Deposits: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Noninterest-bearing demand |  | $ | 10,118,748 |  |  | $ | 10,014,686 |  |  | $ | 12,454,413 |  |  | $ | 104,062 |  |  | $ | (2,335,665 | )
Interest-bearing demand and savings |  |  | 19,457,878 |  |  |  | 18,142,212 |  |  |  | 17,952,568 |  |  |  | 1,315,666 |  |  |  | 1,505,310 |
Time deposits |  |  | 3,098,636 |  |  |  | 3,173,549 |  |  |  | 966,969 |  |  |  | (74,913 | ) |  |  | 2,131,667 |
Total deposits |  | $ | 32,675,262 |  |  | $ | 31,330,447 |  |  | $ | 31,373,950 |  |  | $ | 1,344,815 |  |  | $ | 1,301,312 |
Noninterest bearing deposits as % of total |  |  | 31.0 | % |  |  | 32.0 | % |  |  | 39.7 | % |  |  |  |  |  |

•
Average deposits increased 4.3% on a linked-quarter basis and 4.1% compared to the fourth quarter of 2022.
•
As of December 31, 2023, total estimated uninsured deposits were $24.4 billion, or approximately 68.2% of total deposits. Estimated uninsured deposits, when adjusted to exclude affiliate (company-owned) and collateralized deposits, were $16.2 billion, and represented approximately 45.3% of total deposits.

Capital

Capital information |  | UMB Financial Corporation |
(unaudited, dollars in thousands, except per share data) |  |  |  |  |  |  |  |  |
|  | December 31, 2023 |  |  | September 30, 2023 |  |  | December 31, 2022 |
Total equity |  | $ | 3,100,419 |  |  | $ | 2,806,659 |  |  | $ | 2,667,093 |
Accumulated other comprehensive loss, net |  |  | (556,935 | ) |  |  | (792,371 | ) |  |  | (702,735 | )
Book value per common share |  |  | 63.85 |  |  |  | 57.83 |  |  |  | 55.20 |
Tangible book value per common share (Non-GAAP)(i) |  |  | 58.12 |  |  |  | 52.06 |  |  |  | 49.28 |
Regulatory capital: |  |  |  |  |  |  |  |  |
Common equity Tier 1 capital |  | $ | 3,418,676 |  |  | $ | 3,357,986 |  |  | $ | 3,129,030 |
Tier 1 capital |  |  | 3,418,676 |  |  |  | 3,357,986 |  |  |  | 3,129,030 |
Total capital |  |  | 4,014,910 |  |  |  | 3,955,093 |  |  |  | 3,682,619 |
Regulatory capital ratios: |  |  |  |  |  |  |  |  |
Common equity Tier 1 capital ratio |  |  | 10.94 | % |  |  | 10.77 | % |  |  | 10.62 | %
Tier 1 risk-based capital ratio |  |  | 10.94 |  |  |  | 10.77 |  |  |  | 10.62 |
Total risk-based capital ratio |  |  | 12.85 |  |  |  | 12.68 |  |  |  | 12.50 |
Tier 1 leverage ratio |  |  | 8.49 |  |  |  | 8.55 |  |  |  | 8.43 |

(i) See reconciliation of Non-GAAP measures to their nearest comparable GAAP measures later in this release.

•
At December 31, 2023, the regulatory capital ratios presented in the foregoing table exceeded all “well-capitalized” regulatory thresholds.

Asset Quality

Credit quality |  | UMB Financial Corporation |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Q4 |  |  | Q3 |  |  | Q2 |  |  | Q1 |  |  | Q4 |
|  | 2023 |  |  | 2023 |  |  | 2023 |  |  | 2023 |  |  | 2022 |
Net charge-offs (recoveries) - total loans |  | $ | 1,352 |  |  | $ | 4,618 |  |  | $ | (139 | ) |  | $ | 4,643 |  |  | $ | 2,189 |
Net loan charge-offs (recoveries) as a % of total average loans |  |  | 0.02 | % |  |  | 0.08 | % |  |  | (0.00 | )% |  |  | 0.09 | % |  |  | 0.04 | %
Loans over 90 days past due |  | $ | 3,111 |  |  | $ | 3,044 |  |  | $ | 10,675 |  |  | $ | 1,723 |  |  | $ | 1,617 |
Loans over 90 days past due as a % of total loans |  |  | 0.01 | % |  |  | 0.01 | % |  |  | 0.05 | % |  |  | 0.01 | % |  |  | 0.01 | %
Nonaccrual and restructured loans |  | $ | 13,212 |  |  | $ | 17,042 |  |  | $ | 19,347 |  |  | $ | 15,480 |  |  | $ | 19,269 |
Nonaccrual and restructured loans as a % of total loans |  |  | 0.06 | % |  |  | 0.07 | % |  |  | 0.09 | % |  |  | 0.07 | % |  |  | 0.09 | %
Provision for credit losses |  | $ | — |  |  | $ | 4,977 |  |  | $ | 13,000 |  |  | $ | 23,250 |  |  | $ | 9,000 |

•
Provision for credit losses for the fourth quarter decreased $5.0 million from the linked quarter and $9.0 million from the fourth quarter of 2022. These decreases were driven largely by favorable changes in macro-economic variables and credit metrics in the current period as compared to the prior periods, partially offset by loan growth.
•
Net charge-offs for the fourth quarter totaled $1.4 million, or 0.02%, of average loans, compared to $4.6 million, or 0.08% of average loans in the linked quarter, and $2.2 million, or 0.04% of average loans for the fourth quarter of 2022. On a year-to-date basis, net charge-offs totaled $10.5 million, or 0.05% of average loans, compared to $39.9 million, or 0.21% of average loans, for the same period in 2022.

Dividend Declaration

At the company’s quarterly board meeting, the Board of Directors declared a $0.39 per share quarterly cash dividend, payable on April 1, 2024, to shareholders of record at the close of business on March 11, 2024.

Conference Call

The company plans to host a conference call to discuss its fourth quarter 2023 earnings results on Wednesday, January 31, 2024, at 8:30 a.m. (CT).

Interested parties may access the call by dialing (toll-free) 833-470-1428 or (international) 404-975-4839 and requesting to join the UMB Financial call with access code 269364. The live call may also be accessed by visiting investorrelations.umb.com or by using the following link:

UMB Financial 4Q 2023 Conference Call

A replay of the conference call may be heard through February 14, 2024, by calling (toll-free)

866-813-9403 or (international) 929-458-6194. The replay access code required for playback is 190379. The call replay may also be accessed at investorrelations.umb.com.

Non-GAAP Financial Information

In this release, we may provide information about net operating income, operating earnings per share – diluted (operating EPS), operating return on average equity (operating ROE), operating return on average assets (operating ROA), operating noninterest expense, operating efficiency ratio, operating pre-tax, pre-provision income (operating PTPP), operating pre-tax, pre-provision earnings per share – diluted (operating PTPP EPS), operating pre-tax, pre-provision income on a fully tax equivalent basis (operating PTPP-FTE), operating pre-tax, pre-provision FTE earnings per share – diluted (operating PTPP-FTE EPS), tangible shareholders’ equity, tangible book value per share, and operating return on average tangible equity excluding AOCI, all of which are non-GAAP financial measures. This information

supplements the results that are reported according to generally accepted accounting principles in the United States (GAAP) and should not be viewed in isolation from, or as a substitute for, GAAP results. The differences between the non-GAAP financial measures – net operating income, operating EPS, operating ROE, operating ROA, operating noninterest expense, operating efficiency ratio, operating PTPP, operating PTPP EPS, operating PTPP-FTE, operating PTPP-FTE EPS, tangible shareholders’ equity, tangible book value per share, and operating return on average tangible equity excluding AOCI – and the nearest comparable GAAP financial measures are reconciled later in this release. The company believes that these non-GAAP financial measures and the reconciliations may be useful to investors because they adjust for acquisition- and severance-related items, and the FDIC special assessment that management does not believe reflect the company’s fundamental operating performance.

Net operating income for the relevant period is defined as GAAP net income, adjusted to reflect the impact of excluding expenses related to acquisitions, severance expense, the FDIC special assessment, and the cumulative tax impact of these adjustments.

Operating EPS (diluted) is calculated as earnings per share as reported, adjusted to reflect, on a per share basis, the impact of excluding the non-GAAP adjustments described above for the relevant period. Operating ROE is calculated as net operating income, divided by the company’s average total shareholders’ equity for the relevant period. Operating ROA is calculated as net operating income, divided by the company’s average assets for the relevant period. Operating noninterest expense for the relevant period is defined as GAAP noninterest expense, adjusted to reflect the pre-tax impact of non-GAAP adjustments described above. Operating efficiency ratio is calculated as the company’s operating noninterest expense, net of amortization of other intangibles, divided by the company’s total non-GAAP revenue (calculated as net interest income plus noninterest income, less gains on sales of securities available for sale, net).

Operating PTPP income for the relevant period is defined as GAAP net interest income plus GAAP noninterest income, less noninterest expense, adjusted to reflect the impact of excluding expenses related to acquisitions, severance expense, and the FDIC special assessment.

Operating PTPP-FTE for the relevant period is defined as GAAP net interest income on a fully tax equivalent basis plus GAAP noninterest income, less noninterest expense, adjusted to reflect the impact of excluding expenses related to acquisitions, severance expense, and the FDIC special assessment.

Tangible shareholders’ equity for the relevant period is defined as GAAP shareholders’ equity, net of intangible assets. Tangible book value per share is defined as tangible shareholders’ equity divided by the Company’s total shares outstanding.

Operating return on average tangible equity excluding AOCI is calculated as net operating income, divided by the company’s average tangible shareholders’ equity exclusive of AOCI for the relevant period.

Forward-Looking Statements:

This press release contains, and our other communications may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as “believe,” “expect,” “anticipate,” “intend,” “estimate,” “project,” “outlook,” “forecast,” “target,” “trend,” “plan,” “goal,” or other words of comparable meaning or future-tense or conditional verbs such as “may,” “will,” “should,” “would,” or “could.” Forward-looking statements convey our expectations, intentions, or forecasts about future events, circumstances, results, or aspirations. All forward-looking statements are subject to assumptions, risks, and uncertainties, which may change over time and many of which are beyond our control. You should not rely on any forward-looking statement as a prediction or guarantee about the future. Our actual future objectives, strategies, plans, prospects, performance, condition, or results may differ materially from those set forth in any forward-looking statement. Some of the factors that may cause actual results or other future events,

circumstances, or aspirations to differ from those in forward-looking statements are described in our Annual Report on Form 10-K for the year ended December 31, 2022, our subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K, or other applicable documents that are filed or furnished with the U.S. Securities and Exchange Commission (SEC). In addition to such factors that have been disclosed previously: macroeconomic and adverse developments and uncertainties related to the collateral effects of the collapse of, and challenges for, domestic and international banks, including the impacts to the U.S. and global economies; sustained levels of high inflation and the potential for an economic recession on the heels of aggressive quantitative tightening by the Federal Reserve, and impacts related to or resulting from instability in the Middle East and Russia’s military action in Ukraine, such as the broader impacts to financial markets and the global macroeconomic and geopolitical environments, may also cause actual results or other future events, circumstances, or aspirations to differ from our forward-looking statements. Any forward-looking statement made by us or on our behalf speaks only as of the date that it was made. We do not undertake to update any forward-looking statement to reflect the impact of events, circumstances, or results that arise after the date that the statement was made, except to the extent required by applicable securities laws. You, however, should consult further disclosures (including disclosures of a forward-looking nature) that we may make in any subsequent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K, or other applicable document that is filed or furnished with the SEC.

About UMB:

UMB Financial Corporation (Nasdaq: UMBF) is a financial services company headquartered in Kansas City, Missouri. UMB offers commercial banking, which includes comprehensive deposit, lending and investment services, personal banking, which includes wealth management and financial planning services, and institutional banking, which includes asset servicing, corporate trust solutions, investment banking, and healthcare services. UMB operates branches throughout Missouri, Illinois, Colorado, Kansas, Oklahoma, Nebraska, Arizona and Texas. As the company’s reach continues to grow, it also serves business clients nationwide and institutional clients in several countries. For more information, visit UMB.com, UMB Blog, UMB Facebook and UMB LinkedIn.

Consolidated Balance Sheets |  | UMB Financial Corporation |
(dollars in thousands) |  |  |  |  |  |
|  | December 31, |
|  | 2023 |  |  | 2022 |
|  | (unaudited) |  |  | (audited) |
ASSETS |  |  |  |  |  |
Loans |  | $ | 23,172,484 |  |  | $ | 21,031,189 |
Allowance for credit losses on loans |  |  | (219,738 | ) |  |  | (191,836 | )
Net loans |  |  | 22,952,746 |  |  |  | 20,839,353 |
Loans held for sale |  |  | 4,420 |  |  |  | 1,978 |
Securities: |  |  |  |  |  |
Available for sale |  |  | 7,068,613 |  |  |  | 7,006,347 |
Held to maturity, net of allowance for credit losses |  |  | 5,688,610 |  |  |  | 5,859,192 |
Trading securities |  |  | 18,093 |  |  |  | 17,980 |
Other securities |  |  | 492,935 |  |  |  | 349,758 |
Total securities |  |  | 13,268,251 |  |  |  | 13,233,277 |
Federal funds sold and resell agreements |  |  | 245,344 |  |  |  | 958,597 |
Interest-bearing due from banks |  |  | 5,159,802 |  |  |  | 1,179,105 |
Cash and due from banks |  |  | 447,201 |  |  |  | 500,682 |
Premises and equipment, net |  |  | 241,700 |  |  |  | 263,649 |
Accrued income |  |  | 220,306 |  |  |  | 189,231 |
Goodwill |  |  | 207,385 |  |  |  | 207,385 |
Other intangibles, net |  |  | 71,012 |  |  |  | 78,724 |
Other assets |  |  | 1,193,507 |  |  |  | 1,060,480 |
Total assets |  | $ | 44,011,674 |  |  | $ | 38,512,461 |
LIABILITIES |  |  |  |  |  |
Deposits: |  |  |  |  |  |
Noninterest-bearing demand |  | $ | 12,130,662 |  |  | $ | 13,260,363 |
Interest-bearing demand and savings |  |  | 20,588,606 |  |  |  | 18,461,632 |
Time deposits under $250,000 |  |  | 2,292,899 |  |  |  | 379,087 |
Time deposits of $250,000 or more |  |  | 780,692 |  |  |  | 538,051 |
Total deposits |  |  | 35,792,859 |  |  |  | 32,639,133 |
Federal funds purchased and repurchase agreements |  |  | 2,119,644 |  |  |  | 2,222,167 |
Short-term debt |  |  | 1,800,000 |  |  |  | — |
Long-term debt |  |  | 383,247 |  |  |  | 381,311 |
Accrued expenses and taxes |  |  | 389,860 |  |  |  | 239,624 |
Other liabilities |  |  | 425,645 |  |  |  | 363,133 |
Total liabilities |  |  | 40,911,255 |  |  |  | 35,845,368 |
SHAREHOLDERS' EQUITY |  |  |  |  |  |
Common stock |  |  | 55,057 |  |  |  | 55,057 |
Capital surplus |  |  | 1,134,363 |  |  |  | 1,125,949 |
Retained earnings |  |  | 2,810,824 |  |  |  | 2,536,086 |
Accumulated other comprehensive loss, net |  |  | (556,935 | ) |  |  | (702,735 | )
Treasury stock |  |  | (342,890 | ) |  |  | (347,264 | )
Total shareholders' equity |  |  | 3,100,419 |  |  |  | 2,667,093 |
Total liabilities and shareholders' equity |  | $ | 44,011,674 |  |  | $ | 38,512,461 |

Consolidated Statements of Income |  | UMB Financial Corporation |
(dollars in thousands except share and per share data) |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended |  |  | Year Ended |
|  | December 31, |  |  | December 31, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
|  | (unaudited) |  |  | (unaudited) |  |  | (unaudited) |  |  | (audited) |
INTEREST INCOME |  |  |  |  |  |  |  |  |  |  |  |
Loans |  | $ | 381,041 |  |  | $ | 273,648 |  |  | $ | 1,399,961 |  |  | $ | 810,007 |
Securities: |  |  |  |  |  |  |  |  |  |  |  |
Taxable interest |  |  | 53,890 |  |  |  | 51,441 |  |  |  | 214,981 |  |  |  | 192,121 |
Tax-exempt interest |  |  | 25,637 |  |  |  | 25,105 |  |  |  | 102,197 |  |  |  | 97,190 |
Total securities income |  |  | 79,527 |  |  |  | 76,546 |  |  |  | 317,178 |  |  |  | 289,311 |
Federal funds and resell agreements |  |  | 3,540 |  |  |  | 7,106 |  |  |  | 17,647 |  |  |  | 19,109 |
Interest-bearing due from banks |  |  | 32,267 |  |  |  | 9,373 |  |  |  | 103,190 |  |  |  | 18,582 |
Trading securities |  |  | 227 |  |  |  | 139 |  |  |  | 729 |  |  |  | 511 |
Total interest income |  |  | 496,602 |  |  |  | 366,812 |  |  |  | 1,838,705 |  |  |  | 1,137,520 |
INTEREST EXPENSE |  |  |  |  |  |  |  |  |  |  |  |
Deposits |  |  | 213,842 |  |  |  | 97,484 |  |  |  | 704,210 |  |  |  | 167,553 |
Federal funds and repurchase agreements |  |  | 21,903 |  |  |  | 18,848 |  |  |  | 93,026 |  |  |  | 40,703 |
Other |  |  | 30,335 |  |  |  | 5,314 |  |  |  | 121,353 |  |  |  | 15,467 |
Total interest expense |  |  | 266,080 |  |  |  | 121,646 |  |  |  | 918,589 |  |  |  | 223,723 |
Net interest income |  |  | 230,522 |  |  |  | 245,166 |  |  |  | 920,116 |  |  |  | 913,797 |
Provision for credit losses |  |  | — |  |  |  | 9,000 |  |  |  | 41,227 |  |  |  | 37,900 |
Net interest income after provision for credit losses |  |  | 230,522 |  |  |  | 236,166 |  |  |  | 878,889 |  |  |  | 875,897 |
NONINTEREST INCOME |  |  |  |  |  |  |  |  |  |  |  |
Trust and securities processing |  |  | 66,584 |  |  |  | 59,207 |  |  |  | 257,200 |  |  |  | 237,207 |
Trading and investment banking |  |  | 5,751 |  |  |  | 5,251 |  |  |  | 19,630 |  |  |  | 23,201 |
Service charges on deposit accounts |  |  | 21,330 |  |  |  | 19,758 |  |  |  | 84,950 |  |  |  | 85,167 |
Insurance fees and commissions |  |  | 238 |  |  |  | 459 |  |  |  | 1,009 |  |  |  | 1,338 |
Brokerage fees |  |  | 13,439 |  |  |  | 13,332 |  |  |  | 54,119 |  |  |  | 43,019 |
Bankcard fees |  |  | 18,672 |  |  |  | 19,597 |  |  |  | 74,719 |  |  |  | 73,451 |
Investment securities gains (losses), net |  |  | 1,014 |  |  |  | (409 | ) |  |  | (3,139 | ) |  |  | 58,444 |
Other |  |  | 13,226 |  |  |  | 8,302 |  |  |  | 53,365 |  |  |  | 32,406 |
Total noninterest income |  |  | 140,254 |  |  |  | 125,497 |  |  |  | 541,853 |  |  |  | 554,233 |
NONINTEREST EXPENSE |  |  |  |  |  |  |  |  |  |  |  |
Salaries and employee benefits |  |  | 134,231 |  |  |  | 135,940 |  |  |  | 553,421 |  |  |  | 524,431 |
Occupancy, net |  |  | 12,296 |  |  |  | 12,409 |  |  |  | 48,502 |  |  |  | 48,848 |
Equipment |  |  | 16,579 |  |  |  | 18,969 |  |  |  | 68,718 |  |  |  | 74,259 |
Supplies and services |  |  | 5,546 |  |  |  | 3,697 |  |  |  | 16,829 |  |  |  | 13,590 |
Marketing and business development |  |  | 6,659 |  |  |  | 8,788 |  |  |  | 25,749 |  |  |  | 25,699 |
Processing fees |  |  | 27,271 |  |  |  | 23,545 |  |  |  | 103,099 |  |  |  | 82,227 |
Legal and consulting |  |  | 8,424 |  |  |  | 10,664 |  |  |  | 29,998 |  |  |  | 39,095 |
Bankcard |  |  | 8,677 |  |  |  | 7,369 |  |  |  | 32,969 |  |  |  | 26,367 |
Amortization of other intangible assets |  |  | 2,048 |  |  |  | 1,649 |  |  |  | 8,587 |  |  |  | 5,037 |
Regulatory fees |  |  | 59,183 |  |  |  | 4,232 |  |  |  | 77,010 |  |  |  | 15,378 |
Other |  |  | 9,060 |  |  |  | 10,556 |  |  |  | 34,258 |  |  |  | 43,188 |
Total noninterest expense |  |  | 289,974 |  |  |  | 237,818 |  |  |  | 999,140 |  |  |  | 898,119 |
Income before income taxes |  |  | 80,802 |  |  |  | 123,845 |  |  |  | 421,602 |  |  |  | 532,011 |
Income tax expense |  |  | 9,879 |  |  |  | 23,672 |  |  |  | 71,578 |  |  |  | 100,329 |
NET INCOME |  | $ | 70,923 |  |  | $ | 100,173 |  |  | $ | 350,024 |  |  | $ | 431,682 |
PER SHARE DATA |  |  |  |  |  |  |  |  |  |  |  |
Net income – basic |  | $ | 1.46 |  |  | $ | 2.07 |  |  | $ | 7.22 |  |  | $ | 8.93 |
Net income – diluted |  |  | 1.45 |  |  |  | 2.06 |  |  |  | 7.18 |  |  |  | 8.86 |
Dividends |  |  | 0.39 |  |  |  | 0.38 |  |  |  | 1.53 |  |  |  | 1.49 |
Weighted average shares outstanding – basic |  |  | 48,538,127 |  |  |  | 48,310,993 |  |  |  | 48,503,643 |  |  |  | 48,340,922 |
Weighted average shares outstanding – diluted |  |  | 48,860,020 |  |  |  | 48,735,088 |  |  |  | 48,763,820 |  |  |  | 48,747,399 |

Consolidated Statements of Comprehensive Income |  | UMB Financial Corporation |
(dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended |  |  | Year Ended |
|  | December 31, |  |  | December 31, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
|  | (unaudited) |  |  | (unaudited) |  |  | (unaudited) |  |  | (audited) |
Net income |  | $ | 70,923 |  |  | $ | 100,173 |  |  | $ | 350,024 |  |  | $ | 431,682 |
Other comprehensive income (loss), before tax: |  |  |  |  |  |  |  |  |  |  |  |
Unrealized gains and losses on debt securities: |  |  |  |  |  |  |  |  |  |  |  |
Change in unrealized holding gains and losses, net |  |  | 293,578 |  |  |  | 64,924 |  |  |  | 147,977 |  |  |  | (1,137,417 | )
Less: Reclassification adjustment for net losses included in net income |  |  | — |  |  |  | — |  |  |  | 279 |  |  |  | — |
Amortization of net unrealized loss on securities transferred from available-for-sale to held-to-maturity |  |  | 9,288 |  |  |  | 11,186 |  |  |  | 39,851 |  |  |  | 36,894 |
Change in unrealized gains and losses on debt securities |  |  | 302,866 |  |  |  | 76,110 |  |  |  | 188,107 |  |  |  | (1,100,523 | )
Unrealized gains and losses on derivative hedges: |  |  |  |  |  |  |  |  |  |  |  |
Change in unrealized gains and losses on derivative hedges, net |  |  | 10,767 |  |  |  | 170 |  |  |  | 15,015 |  |  |  | 12,608 |
Less: Reclassification adjustment for net gains included in net income |  |  | (2,589 | ) |  |  | (1,942 | ) |  |  | (10,654 | ) |  |  | (5,353 | )
Change in unrealized gains and losses on derivative hedges |  |  | 8,178 |  |  |  | (1,772 | ) |  |  | 4,361 |  |  |  | 7,255 |
Other comprehensive income (loss), before tax |  |  | 311,044 |  |  |  | 74,338 |  |  |  | 192,468 |  |  |  | (1,093,268 | )
Income tax (expense) benefit |  |  | (75,608 | ) |  |  | (17,813 | ) |  |  | (46,668 | ) |  |  | 264,219 |
Other comprehensive income (loss) |  |  | 235,436 |  |  |  | 56,525 |  |  |  | 145,800 |  |  |  | (829,049 | )
Comprehensive income (loss) |  | $ | 306,359 |  |  | $ | 156,698 |  |  | $ | 495,824 |  |  | $ | (397,367 | )

Consolidated Statements of Shareholders' Equity | UMB Financial Corporation |
(dollars in thousands except per share data) |  |  |  |  |  |  |  |  |  |  |  |  |
(audited) |  | Common Stock |  |  | Capital Surplus |  |  | Retained Earnings |  |  | Accumulated Other Comprehensive Income (Loss) |  |  | Treasury Stock |  |  | Total |
Balance - January 1, 2022 |  | $ | 55,057 |  |  | $ | 1,110,520 |  |  | $ | 2,176,998 |  |  | $ | 126,314 |  |  | $ | (323,465 | ) |  | $ | 3,145,424 |
Total comprehensive income (loss) |  |  | — |  |  |  | — |  |  |  | 431,682 |  |  |  | (829,049 | ) |  |  | — |  |  |  | (397,367 | )
Dividends ($1.49 per share) |  |  | — |  |  |  | — |  |  |  | (72,594 | ) |  |  | — |  |  |  | — |  |  |  | (72,594 | )
Purchase of treasury stock |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (31,997 | ) |  |  | (31,997 | )
Issuances of equity awards, net of forfeitures |  |  | — |  |  |  | (6,143 | ) |  |  | — |  |  |  | — |  |  |  | 6,822 |  |  |  | 679 |
Recognition of equity-based compensation |  |  | — |  |  |  | 20,812 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 20,812 |
Sale of treasury stock |  |  | — |  |  |  | 351 |  |  |  | — |  |  |  | — |  |  |  | 245 |  |  |  | 596 |
Exercise of stock options |  |  | — |  |  |  | 409 |  |  |  | — |  |  |  | — |  |  |  | 1,131 |  |  |  | 1,540 |
Balance - December 31, 2022 |  | $ | 55,057 |  |  | $ | 1,125,949 |  |  | $ | 2,536,086 |  |  | $ | (702,735 | ) |  | $ | (347,264 | ) |  | $ | 2,667,093 |
(unaudited) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance - January 1, 2023 |  | $ | 55,057 |  |  | $ | 1,125,949 |  |  | $ | 2,536,086 |  |  | $ | (702,735 | ) |  | $ | (347,264 | ) |  | $ | 2,667,093 |
Total comprehensive income |  |  | — |  |  |  | — |  |  |  | 350,024 |  |  |  | 145,800 |  |  |  | — |  |  |  | 495,824 |
Dividends ($1.53 per share) |  |  | — |  |  |  | — |  |  |  | (75,286 | ) |  |  | — |  |  |  | — |  |  |  | (75,286 | )
Purchase of treasury stock |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (8,367 | ) |  |  | (8,367 | )
Issuances of equity awards, net of forfeitures |  |  | — |  |  |  | (10,385 | ) |  |  | — |  |  |  | — |  |  |  | 11,104 |  |  |  | 719 |
Recognition of equity-based compensation |  |  | — |  |  |  | 17,975 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 17,975 |
Sale of treasury stock |  |  | — |  |  |  | 220 |  |  |  | — |  |  |  | — |  |  |  | 296 |  |  |  | 516 |
Exercise of stock options |  |  | — |  |  |  | 604 |  |  |  | — |  |  |  | — |  |  |  | 1,341 |  |  |  | 1,945 |
Balance - December 31, 2023 |  | $ | 55,057 |  |  | $ | 1,134,363 |  |  | $ | 2,810,824 |  |  | $ | (556,935 | ) |  | $ | (342,890 | ) |  | $ | 3,100,419 |

Average Balances / Yields and Rates |  | UMB Financial Corporation |
(tax - equivalent basis) |  |  |  |  |  |  |  |  |  |  |  |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended December 31, |
|  | 2023 |  |  | 2022 |
|  | Average |  |  | Average |  |  | Average |  |  | Average |
|  | Balance |  |  | Yield/Rate |  |  | Balance |  |  | Yield/Rate |
Assets |  |  |  |  |  |  |  |  |  |  |  |
Loans, net of unearned interest |  | $ | 23,109,063 |  |  |  | 6.54 | % |  | $ | 20,294,661 |  |  |  | 5.35 | %
Securities: |  |  |  |  |  |  |  |  |  |  |  |
Taxable |  |  | 8,853,426 |  |  |  | 2.41 |  |  |  | 9,382,837 |  |  |  | 2.18 |
Tax-exempt |  |  | 3,716,141 |  |  |  | 3.44 |  |  |  | 3,803,737 |  |  |  | 3.31 |
Total securities |  |  | 12,569,567 |  |  |  | 2.72 |  |  |  | 13,186,574 |  |  |  | 2.50 |
Federal funds and resell agreements |  |  | 235,284 |  |  |  | 5.97 |  |  |  | 656,092 |  |  |  | 4.30 |
Interest bearing due from banks |  |  | 2,372,767 |  |  |  | 5.40 |  |  |  | 1,135,356 |  |  |  | 3.28 |
Trading securities |  |  | 16,880 |  |  |  | 5.83 |  |  |  | 11,799 |  |  |  | 5.31 |
Total earning assets |  |  | 38,303,561 |  |  |  | 5.21 |  |  |  | 35,284,482 |  |  |  | 4.20 |
Allowance for credit losses |  |  | (223,668 | ) |  |  |  |  |  | (188,299 | ) |  |  |
Other assets |  |  | 2,435,687 |  |  |  |  |  |  | 2,243,437 |  |  |  |
Total assets |  | $ | 40,515,580 |  |  |  |  |  | $ | 37,339,620 |  |  |  |
Liabilities and Shareholders' Equity |  |  |  |  |  |  |  |  |  |  |  |
Interest-bearing deposits |  | $ | 22,556,514 |  |  |  | 3.76 | % |  | $ | 18,919,537 |  |  |  | 2.04 | %
Federal funds and repurchase agreements |  |  | 1,883,392 |  |  |  | 4.61 |  |  |  | 2,424,171 |  |  |  | 3.08 |
Borrowed funds |  |  | 2,286,271 |  |  |  | 5.26 |  |  |  | 396,874 |  |  |  | 5.31 |
Total interest-bearing liabilities |  |  | 26,726,177 |  |  |  | 3.95 |  |  |  | 21,740,582 |  |  |  | 2.22 |
Noninterest-bearing demand deposits |  |  | 10,118,748 |  |  |  |  |  |  | 12,454,413 |  |  |  |
Other liabilities |  |  | 715,688 |  |  |  |  |  |  | 522,932 |  |  |  |
Shareholders' equity |  |  | 2,954,967 |  |  |  |  |  |  | 2,621,693 |  |  |  |
Total liabilities and shareholders' equity |  | $ | 40,515,580 |  |  |  |  |  | $ | 37,339,620 |  |  |  |
Net interest spread |  |  |  |  |  | 1.26 | % |  |  |  |  |  | 1.98 | %
Net interest margin |  |  |  |  |  | 2.46 |  |  |  |  |  |  | 2.83 |

Average Balances / Yields and Rates |  | UMB Financial Corporation |
(tax - equivalent basis) |  |  |  |  |  |  |  |  |  |  |  |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |
|  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |
|  | Average |  |  | Average |  |  | Average |  |  | Average |
|  | Balance |  |  | Yield/Rate |  |  | Balance |  |  | Yield/Rate |
Assets |  |  |  |  |  |  |  |  |  |  |  |
Loans, net of unearned interest |  | $ | 22,337,119 |  |  |  | 6.27 | % |  | $ | 18,823,810 |  |  |  | 4.30 | %
Securities: |  |  |  |  |  |  |  |  |  |  |  |
Taxable |  |  | 9,097,110 |  |  |  | 2.36 |  |  |  | 9,616,691 |  |  |  | 2.00 |
Tax-exempt |  |  | 3,790,921 |  |  |  | 3.38 |  |  |  | 3,885,153 |  |  |  | 3.16 |
Total securities |  |  | 12,888,031 |  |  |  | 2.66 |  |  |  | 13,501,844 |  |  |  | 2.33 |
Federal funds and resell agreements |  |  | 316,072 |  |  |  | 5.58 |  |  |  | 965,911 |  |  |  | 1.98 |
Interest bearing due from banks |  |  | 2,046,349 |  |  |  | 5.04 |  |  |  | 2,408,468 |  |  |  | 0.77 |
Trading securities |  |  | 14,030 |  |  |  | 5.65 |  |  |  | 12,076 |  |  |  | 4.96 |
Total earning assets |  |  | 37,601,601 |  |  |  | 4.96 |  |  |  | 35,712,109 |  |  |  | 3.26 |
Allowance for credit losses |  |  | (216,245 | ) |  |  |  |  |  | (184,072 | ) |  |  |
Other assets |  |  | 2,344,911 |  |  |  |  |  |  | 2,050,976 |  |  |  |
Total assets |  | $ | 39,730,267 |  |  |  |  |  | $ | 37,579,013 |  |  |  |
Liabilities and Shareholders' Equity |  |  |  |  |  |  |  |  |  |  |  |
Interest-bearing deposits |  | $ | 21,122,305 |  |  |  | 3.33 | % |  | $ | 18,063,498 |  |  |  | 0.93 | %
Federal funds and repurchase agreements |  |  | 2,175,415 |  |  |  | 4.28 |  |  |  | 2,777,089 |  |  |  | 1.47 |
Borrowed funds |  |  | 2,311,238 |  |  |  | 5.25 |  |  |  | 309,204 |  |  |  | 5.00 |
Total interest-bearing liabilities |  |  | 25,608,958 |  |  |  | 3.59 |  |  |  | 21,149,791 |  |  |  | 1.06 |
Noninterest-bearing demand deposits |  |  | 10,640,344 |  |  |  |  |  |  | 13,264,146 |  |  |  |
Other liabilities |  |  | 618,230 |  |  |  |  |  |  | 438,772 |  |  |  |
Shareholders' equity |  |  | 2,862,735 |  |  |  |  |  |  | 2,726,304 |  |  |  |
Total liabilities and shareholders' equity |  | $ | 39,730,267 |  |  |  |  |  | $ | 37,579,013 |  |  |  |
Net interest spread |  |  |  |  |  | 1.37 | % |  |  |  |  |  | 2.20 | %
Net interest margin |  |  |  |  |  | 2.52 |  |  |  |  |  |  | 2.63 |

Business Segment Information |  | UMB Financial Corporation |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended December 31, 2023 |
|  | Commercial Banking |  |  | Institutional Banking |  |  | Personal Banking |  |  | Total |
Net interest income |  | $ | 154,289 |  |  | $ | 44,150 |  |  | $ | 32,083 |  |  | $ | 230,522 |
Provision for credit losses |  |  | (1,926 | ) |  |  | 653 |  |  |  | 1,273 |  |  |  | — |
Noninterest income |  |  | 25,956 |  |  |  | 90,361 |  |  |  | 23,937 |  |  |  | 140,254 |
Noninterest expense |  |  | 114,190 |  |  |  | 114,306 |  |  |  | 61,478 |  |  |  | 289,974 |
Income (loss) before taxes |  |  | 67,981 |  |  |  | 19,552 |  |  |  | (6,731 | ) |  |  | 80,802 |
Income tax expense |  |  | 5,321 |  |  |  | 2,913 |  |  |  | 1,645 |  |  |  | 9,879 |
Net income (loss) |  | $ | 62,660 |  |  | $ | 16,639 |  |  | $ | (8,376 | ) |  | $ | 70,923 |
|  | Three Months Ended December 31, 2022 |
|  | Commercial Banking |  |  | Institutional Banking |  |  | Personal Banking |  |  | Total |
Net interest income |  | $ | 151,856 |  |  | $ | 55,063 |  |  |  | 38,247 |  |  | $ | 245,166 |
Provision for credit losses |  |  | 7,668 |  |  |  | 93 |  |  |  | 1,239 |  |  |  | 9,000 |
Noninterest income |  |  | 22,233 |  |  |  | 80,055 |  |  |  | 23,209 |  |  |  | 125,497 |
Noninterest expense |  |  | 86,682 |  |  |  | 86,791 |  |  |  | 64,345 |  |  |  | 237,818 |
Income (loss) before taxes |  |  | 79,739 |  |  |  | 48,234 |  |  |  | (4,128 | ) |  |  | 123,845 |
Income tax expense (benefit) |  |  | 15,176 |  |  |  | 9,264 |  |  |  | (768 | ) |  |  | 23,672 |
Net income (loss) |  | $ | 64,563 |  |  | $ | 38,970 |  |  | $ | (3,360 | ) |  | $ | 100,173 |
|  | Year Ended December 31, 2023 |
|  | Commercial Banking |  |  | Institutional Banking |  |  | Personal Banking |  |  | Total |
Net interest income |  | $ | 598,371 |  |  | $ | 192,765 |  |  | $ | 128,980 |  |  | $ | 920,116 |
Provision for credit losses |  |  | 33,184 |  |  |  | 1,406 |  |  |  | 6,637 |  |  |  | 41,227 |
Noninterest income |  |  | 97,614 |  |  |  | 347,933 |  |  |  | 96,306 |  |  |  | 541,853 |
Noninterest expense |  |  | 365,856 |  |  |  | 382,770 |  |  |  | 250,514 |  |  |  | 999,140 |
Income (loss) before taxes |  |  | 296,945 |  |  |  | 156,522 |  |  |  | (31,865 | ) |  |  | 421,602 |
Income tax expense (benefit) |  |  | 48,403 |  |  |  | 26,838 |  |  |  | (3,663 | ) |  |  | 71,578 |
Net income (loss) |  | $ | 248,542 |  |  | $ | 129,684 |  |  | $ | (28,202 | ) |  | $ | 350,024 |
|  | Year Ended December 31, 2022 |
|  | Commercial Banking |  |  | Institutional Banking |  |  | Personal Banking |  |  | Total |
Net interest income |  | $ | 596,031 |  |  | $ | 159,679 |  |  | $ | 158,087 |  |  | $ | 913,797 |
Provision for credit losses |  |  | 32,851 |  |  |  | 495 |  |  |  | 4,554 |  |  |  | 37,900 |
Noninterest income |  |  | 122,614 |  |  |  | 323,794 |  |  |  | 107,825 |  |  |  | 554,233 |
Noninterest expense |  |  | 332,912 |  |  |  | 320,976 |  |  |  | 244,231 |  |  |  | 898,119 |
Income before taxes |  |  | 352,882 |  |  |  | 162,002 |  |  |  | 17,127 |  |  |  | 532,011 |
Income tax expense |  |  | 67,134 |  |  |  | 31,889 |  |  |  | 1,306 |  |  |  | 100,329 |
Net income |  | $ | 285,748 |  |  | $ | 130,113 |  |  | $ | 15,821 |  |  | $ | 431,682 |

The company has strategically aligned its operations into the following three reportable segments: Commercial Banking, Institutional Banking, and Personal Banking. Senior executive officers regularly evaluate business segment financial results produced by the company’s internal reporting system in deciding how to allocate resources and assess performance for individual business segments. The company’s reportable segments include certain corporate overhead, technology and service costs that are allocated based on methodologies that are applied consistently between periods. For comparability purposes, amounts in all periods are based on methodologies in effect at December 31, 2023.

Non-GAAP Financial Measures

Net operating income Non-GAAP reconciliations: |  | UMB Financial Corporation |
(unaudited, dollars in thousands except per share data) |  |  |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended December 31, |  |  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Net income (GAAP) |  | $ | 70,923 |  |  | $ | 100,173 |  |  | $ | 350,024 |  |  | $ | 431,682 |
Adjustments: |  |  |  |  |  |  |  |  |  |  |  |
Acquisition expense |  |  | 52 |  |  |  | 851 |  |  |  | 179 |  |  |  | 922 |
Severance expense |  |  | 1,207 |  |  |  | 358 |  |  |  | 8,943 |  |  |  | 838 |
FDIC special assessment |  |  | 52,840 |  |  |  | — |  |  |  | 52,840 |  |  |  | — |
Tax-impact of adjustments (i) |  |  | (12,984 | ) |  |  | (290 | ) |  |  | (14,871 | ) |  |  | (422 | )
Total Non-GAAP adjustments (net of tax) |  |  | 41,115 |  |  |  | 919 |  |  |  | 47,091 |  |  |  | 1,338 |
Net operating income (Non-GAAP) |  | $ | 112,038 |  |  | $ | 101,092 |  |  | $ | 397,115 |  |  | $ | 433,020 |
Earnings per share - diluted (GAAP) |  | $ | 1.45 |  |  | $ | 2.06 |  |  | $ | 7.18 |  |  | $ | 8.86 |
Acquisition expense |  |  | — |  |  |  | 0.02 |  |  |  | — |  |  |  | 0.02 |
Severance expense |  |  | 0.02 |  |  |  | 0.01 |  |  |  | 0.18 |  |  |  | 0.02 |
FDIC special assessment |  |  | 1.08 |  |  |  | — |  |  |  | 1.08 |  |  |  | — |
Tax-impact of adjustments (i) |  |  | (0.26 | ) |  |  | (0.02 | ) |  |  | (0.30 | ) |  |  | (0.02 | )
Operating earnings per share - diluted (Non-GAAP) |  | $ | 2.29 |  |  | $ | 2.07 |  |  | $ | 8.14 |  |  | $ | 8.88 |
GAAP |  |  |  |  |  |  |  |  |  |  |  |
Return on average assets |  |  | 0.69 | % |  |  | 1.06 | % |  |  | 0.88 | % |  |  | 1.15 | %
Return on average equity |  |  | 9.52 |  |  |  | 15.16 |  |  |  | 12.23 |  |  |  | 15.83 |
Non-GAAP |  |  |  |  |  |  |  |  |  |  |  |
Operating return on average assets |  |  | 1.10 | % |  |  | 1.07 | % |  |  | 1.00 | % |  |  | 1.15 | %
Operating return on average equity |  |  | 15.04 |  |  |  | 15.30 |  |  |  | 13.87 |  |  |  | 15.88 |

(i) Calculated using the company’s marginal tax rate of 24.0%.

Operating noninterest expense and operating efficiency ratio Non-GAAP reconciliations: |  | UMB Financial Corporation |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended December 31, |  |  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Noninterest expense |  | $ | 289,974 |  |  | $ | 237,818 |  |  | $ | 999,140 |  |  | $ | 898,119 |
Adjustments to arrive at operating noninterest expense (pre-tax): |  |  |  |  |  |  |  |  |  |  |  |
Acquisition expense |  |  | 52 |  |  |  | 851 |  |  |  | 179 |  |  |  | 922 |
Severance expense |  |  | 1,207 |  |  |  | 358 |  |  |  | 8,943 |  |  |  | 838 |
FDIC special assessment |  |  | 52,840 |  |  |  | — |  |  |  | 52,840 |  |  |  | — |
Total Non-GAAP adjustments (pre-tax) |  |  | 54,099 |  |  |  | 1,209 |  |  |  | 61,962 |  |  |  | 1,760 |
Operating noninterest expense (Non-GAAP) |  | $ | 235,875 |  |  | $ | 236,609 |  |  | $ | 937,178 |  |  | $ | 896,359 |
Noninterest expense |  | $ | 289,974 |  |  | $ | 237,818 |  |  | $ | 999,140 |  |  | $ | 898,119 |
Less: Amortization of other intangibles |  |  | 2,048 |  |  |  | 1,649 |  |  |  | 8,587 |  |  |  | 5,037 |
Noninterest expense, net of amortization of other intangibles (Non-GAAP) (numerator A) |  | $ | 287,926 |  |  | $ | 236,169 |  |  | $ | 990,553 |  |  | $ | 893,082 |
Operating noninterest expense |  | $ | 235,875 |  |  | $ | 236,609 |  |  | $ | 937,178 |  |  | $ | 896,359 |
Less: Amortization of other intangibles |  |  | 2,048 |  |  |  | 1,649 |  |  |  | 8,587 |  |  |  | 5,037 |
Operating expense, net of amortization of other intangibles (Non-GAAP) (numerator B) |  | $ | 233,827 |  |  | $ | 234,960 |  |  | $ | 928,591 |  |  | $ | 891,322 |
Net interest income |  | $ | 230,522 |  |  | $ | 245,166 |  |  | $ | 920,116 |  |  | $ | 913,797 |
Noninterest income |  |  | 140,254 |  |  |  | 125,497 |  |  |  | 541,853 |  |  |  | 554,233 |
Less: Gains on sales of securities available for sale, net |  |  | — |  |  |  | — |  |  |  | 152 |  |  |  | — |
Total Non-GAAP Revenue (denominator A) |  | $ | 370,776 |  |  | $ | 370,663 |  |  | $ | 1,461,817 |  |  | $ | 1,468,030 |
Efficiency ratio (numerator A/denominator A) |  |  | 77.65 | % |  |  | 63.72 | % |  |  | 67.76 | % |  |  | 60.84 | %
Operating efficiency ratio (Non-GAAP) (numerator B/denominator A) |  |  | 63.06 |  |  |  | 63.39 |  |  |  | 63.52 |  |  |  | 60.72 |

Operating pre-tax, pre-provision income non-GAAP reconciliations: | UMB Financial Corporation |
(unaudited, dollars in thousands except per share data) |  |  |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended December 31, |  |  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Net interest income (GAAP) |  | $ | 230,522 |  |  | $ | 245,166 |  |  | $ | 920,116 |  |  | $ | 913,797 |
Noninterest income (GAAP) |  |  | 140,254 |  |  |  | 125,497 |  |  |  | 541,853 |  |  |  | 554,233 |
Noninterest expense (GAAP) |  |  | 289,974 |  |  |  | 237,818 |  |  |  | 999,140 |  |  |  | 898,119 |
Adjustments to arrive at operating noninterest expense: |  |  |  |  |  |  |  |  |  |  |  |
Acquisition expense |  |  | 52 |  |  |  | 851 |  |  |  | 179 |  |  |  | 922 |
Severance expense |  |  | 1,207 |  |  |  | 358 |  |  |  | 8,943 |  |  |  | 838 |
FDIC special assessment |  |  | 52,840 |  |  |  | — |  |  |  | 52,840 |  |  |  | — |
Total Non-GAAP adjustments |  |  | 54,099 |  |  |  | 1,209 |  |  |  | 61,962 |  |  |  | 1,760 |
Operating noninterest expense (Non-GAAP) |  |  | 235,875 |  |  |  | 236,609 |  |  |  | 937,178 |  |  |  | 896,359 |
Operating pre-tax, pre-provision income (Non-GAAP) |  | $ | 134,901 |  |  | $ | 134,054 |  |  | $ | 524,791 |  |  | $ | 571,671 |
Net interest income earnings per share - diluted (GAAP) |  | $ | 4.72 |  |  | $ | 5.03 |  |  | $ | 18.87 |  |  | $ | 18.75 |
Noninterest income (GAAP) |  |  | 2.87 |  |  |  | 2.57 |  |  |  | 11.11 |  |  |  | 11.37 |
Noninterest expense (GAAP) |  |  | 5.93 |  |  |  | 4.88 |  |  |  | 20.48 |  |  |  | 18.43 |
Acquisition expense |  |  | — |  |  |  | 0.02 |  |  |  | — |  |  |  | 0.02 |
Severance expense |  |  | 0.02 |  |  |  | 0.01 |  |  |  | 0.18 |  |  |  | 0.02 |
FDIC special assessment |  |  | 1.08 |  |  |  | — |  |  |  | 1.08 |  |  |  | — |
Operating pre-tax, pre-provision earnings per share - diluted (Non-GAAP) |  | $ | 2.76 |  |  | $ | 2.75 |  |  | $ | 10.76 |  |  | $ | 11.73 |

Operating pre-tax, pre-provision income - FTE Non-GAAP reconciliations: |  | UMB Financial Corporation |
(unaudited, dollars in thousands except per share data) |  |  |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended December 31, |  |  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Net interest income (GAAP) |  | $ | 230,522 |  |  | $ | 245,166 |  |  | $ | 920,116 |  |  | $ | 913,797 |
Adjustments to arrive at net interest income - FTE: |  |  |  |  |  |  |  |  |  |  |  |
Tax equivalent interest |  |  | 6,670 |  |  |  | 6,663 |  |  |  | 26,359 |  |  |  | 25,794 |
Net interest income - FTE (Non-GAAP) |  |  | 237,192 |  |  |  | 251,829 |  |  |  | 946,475 |  |  |  | 939,591 |
Noninterest income (GAAP) |  |  | 140,254 |  |  |  | 125,497 |  |  |  | 541,853 |  |  |  | 554,233 |
Noninterest expense (GAAP) |  |  | 289,974 |  |  |  | 237,818 |  |  |  | 999,140 |  |  |  | 898,119 |
Adjustments to arrive at operating noninterest expense: |  |  |  |  |  |  |  |  |  |  |  |
Acquisition expense |  |  | 52 |  |  |  | 851 |  |  |  | 179 |  |  |  | 922 |
Severance expense |  |  | 1,207 |  |  |  | 358 |  |  |  | 8,943 |  |  |  | 838 |
FDIC special assessment |  |  | 52,840 |  |  |  | — |  |  |  | 52,840 |  |  |  | — |
Total Non-GAAP adjustments |  |  | 54,099 |  |  |  | 1,209 |  |  |  | 61,962 |  |  |  | 1,760 |
Operating noninterest expense (Non-GAAP) |  |  | 235,875 |  |  |  | 236,609 |  |  |  | 937,178 |  |  |  | 896,359 |
Operating pre-tax, pre-provision income - FTE (Non-GAAP) |  | $ | 141,571 |  |  | $ | 140,717 |  |  | $ | 551,150 |  |  | $ | 597,465 |
Net interest income earnings per share - diluted (GAAP) |  | $ | 4.72 |  |  | $ | 5.03 |  |  | $ | 18.87 |  |  | $ | 18.75 |
Tax equivalent interest |  |  | 0.14 |  |  |  | 0.14 |  |  |  | 0.54 |  |  |  | 0.53 |
Net interest income - FTE (Non-GAAP) |  |  | 4.86 |  |  |  | 5.17 |  |  |  | 19.41 |  |  |  | 19.28 |
Noninterest income (GAAP) |  |  | 2.87 |  |  |  | 2.57 |  |  |  | 11.11 |  |  |  | 11.37 |
Noninterest expense (GAAP) |  |  | 5.93 |  |  |  | 4.88 |  |  |  | 20.48 |  |  |  | 18.43 |
Acquisition expense |  |  | — |  |  |  | 0.02 |  |  |  | — |  |  |  | 0.02 |
Severance expense |  |  | 0.02 |  |  |  | 0.01 |  |  |  | 0.18 |  |  |  | 0.02 |
FDIC special assessment |  |  | 1.08 |  |  |  | — |  |  |  | 1.08 |  |  |  | — |
Operating pre-tax, pre-provision income - FTE earnings per share - diluted (Non-GAAP) |  | $ | 2.90 |  |  | $ | 2.89 |  |  | $ | 11.30 |  |  | $ | 12.26 |

Tangible book value non-GAAP reconciliations: | UMB Financial Corporation |
(unaudited, dollars in thousands except share and per share data) |  |  |  |  |  |
|  | As of December 31, |
|  | 2023 |  |  | 2022 |
Total shareholders' equity (GAAP) |  | $ | 3,100,419 |  |  | $ | 2,667,093 |
Less: Intangible assets |  |  |  |  |  |
Goodwill |  |  | 207,385 |  |  |  | 207,385 |
Other intangibles, net |  |  | 71,012 |  |  |  | 78,724 |
Total intangibles, net |  |  | 278,397 |  |  |  | 286,109 |
Total tangible shareholders' equity (Non-GAAP) |  | $ | 2,822,022 |  |  | $ | 2,380,984 |
Total shares outstanding |  |  | 48,554,127 |  |  |  | 48,319,404 |
Ratio of total shareholders' equity (book value) per share |  | $ | 63.85 |  |  | $ | 55.20 |
Ratio of total tangible shareholders' equity (tangible book value) per share (Non-GAAP) |  |  | 58.12 |  |  |  | 49.28 |

Operating return on average tangible equity excluding AOCI non-GAAP reconciliations: | UMB Financial Corporation |
(unaudited, dollars in thousands) |  |  |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended December 31, |  |  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Average total shareholders' equity (GAAP) |  | $ | 2,954,967 |  |  | $ | 2,621,693 |  |  | $ | 2,862,735 |  |  | $ | 2,726,304 |
Less: Average intangible assets |  |  |  |  |  |  |  |  |  |  |  |
Average goodwill |  |  | 207,385 |  |  |  | 194,805 |  |  |  | 207,385 |  |  |  | 183,512 |
Average other intangibles, net |  |  | 72,322 |  |  |  | 46,243 |  |  |  | 74,868 |  |  |  | 22,414 |
Average total intangibles, net |  |  | 279,707 |  |  |  | 241,049 |  |  |  | 282,254 |  |  |  | 205,926 |
Average total tangible shareholders' equity (Non-GAAP) |  |  | 2,675,260 |  |  |  | 2,380,644 |  |  |  | 2,580,481 |  |  |  | 2,520,378 |
Less: Average accumulated other comprehensive loss (AOCI) |  |  | (730,891 | ) |  |  | (741,438 | ) |  |  | (681,436 | ) |  |  | (490,058 | )
Average total tangible shareholders' equity excluding AOCI (Non-GAAP) |  | $ | 3,406,151 |  |  | $ | 3,122,082 |  |  | $ | 3,261,918 |  |  | $ | 3,010,436 |
Net operating income (Non-GAAP) |  | $ | 112,038 |  |  | $ | 101,092 |  |  | $ | 397,115 |  |  | $ | 433,020 |
Operating return on average tangible equity excluding AOCI (Non-GAAP) |  |  | 13.05 | % |  |  | 12.85 | % |  |  | 12.17 | % |  |  | 14.38 | %