AUB earnings call for the time scale December that is ending 31 2019.
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Atlantic Union Bankshares Corporation (NASDAQ: AUB)
Q4 2019 profits Call
Jan 21, 2020, 9:00 a.m. ET
- Ready Remarks
- Concerns and responses
- Phone Individuals
Prepared Remarks:
Operator
Women and men, many thanks for standing by and welcome to your Atlantic Union Bankshares Fourth Quarter and Comprehensive 12 months 2019 profits Call. Operator Guidelines
I’d now want to control the seminar up to your presenter today, Mr. Bill Cimino. You might start.
William P. Cimino — Senior Vice President and Director of Investor Relations
Many thanks. Carl, and good early morning everybody else. You enjoyed the brief bit of news with this program, I do want to say that we’ll probably next time go with music instead of the news on the hold while I hope. We have Atlantic Union Bankshares’ President and CEO, John Asbury beside me today; and Executive Vice President and CFO, Rob Gorman. We also provide other users of us for the question-and-answer period to our Executive Management team.
Take note that today’s profits launch can be obtained to down load on our Investor site, investors. Atlanticunionbank.com. Throughout the call today, we shall touch upon our performance that is financial using GAAP metrics and non-GAAP economic measures. Important info about these non-GAAP monetary measures, including reconciliations to comparable GAAP measures is roofed within our earnings launch when it comes to fourth quarter and full-year 2019.
Before we turn the call up to John, I wish to remind every person that on today’s call we shall make forward-looking statements, that are not statements of historic reality as they are at the mercy of dangers and money key loans uncertainties. There may be no assurance that real performance will not vary materially from any future outcomes expressed or suggested by these statements that are forward-looking.
We undertake no responsibility to publicly revise any forward-looking statements. Please relate to our earnings launch for the quarter that is fourth complete year 2019 and our other SEC filings for further conversation of this business’s risk facets as well as other important info regarding our forward-looking statements, including facets which could cause real leads to vary. All opinions made during today’s call are at the mercy of that secure Harbor declaration. During the final end associated with call, we shall just just take concerns through the research analyst community.
And today we’ll turn the phone call up to John Asbury.
John C. Asbury — President and Ceo
Many thanks, Bill. Compliment of all for joining us today and delighted year that is new Atlantic Union Bankshares Corporation. I want to explain i am fighting a cold, and so I apologize ahead of time when it comes to rough vocals and periodic cough.
We shut out an eventful 2018 with a good 4th quarter by continuing to perform on our strategic plan and hitting the mortgage and deposit growth targets we revised final quarter. Once we start 2020, we continue steadily to think we now have a fantastic possibility before us to produce one thing uniquely valuable for the shareholders and also the communities we provide and stay keenly dedicated to attaining the full potential for this effective franchise.
Atlantic Union accomplished much in 2019. To start out, we shut the Access nationwide Bank purchase on 1st and converted their core systems in May; successfully and uneventful rebranded the Company to Atlantic Union and changed the stock trading symbol to AUB; delivered 8% deposit growth while loan growth was 6% for the year february.
The year-end loan to deposit ratio was at line 95% target right where it must be; we finished the change associated with Executive Leadership group, utilizing the hiring of David Zimmerman within the 4th quarter to head our Wealth Management Group up Middleburg Financial; authorized and rolled away our brand brand new three-year strategic want to our teammates; included a proven equipment financing group to shut the commercial banking item space; launched Zelle and included nCino to handle electronic item gaps; won lots of a client experience honors, such as the much coveted number 1 position for the J.D. Energy Retail Banking Satisfaction Survey for the Mid-Atlantic region in 2019, aided by the Mid-Atlantic region defined by J.D. Energy as Virginia to New York State, there was none better; last a concentrated effort to make use of the coming market disruption through the Truist merger.
Rob will give you more information regarding the monetary performance in the part, however for running metrics when it comes to fourth quarter, our running return on concrete equity had been 16.01%, that will be a 37 foundation point enhance through the quarter that is third. For the full-year, our operating ROTCE was 16.14%.
Running return on assets had been 1.30percent, up 1 basis points through the quarter that is prior. When it comes to operating that is full-year had been 1.31percent. Running effectiveness ratio ended up being 52.65%, which can be a 247 foundation point decrease through the previous quarter. In belated 2018, we communicated that individuals had updated our top-tier economic objectives towards the after; operating ROTCE between 16% and 18%; operating ROA between 1.4% and 1.6%; plus a running efficiency ratio of 50% or below. We made those updates then hoping to run in a increasing price environment and stepped up our top-tier economic metrics properly.
Given that financial and environment that is geopolitical changed during the period of 2019, we shifted objectives for the Federal Reserve to cut prices. Also then your price environment ended up being below our expectations, and there clearly was a sustained inversion of this yield bend that negatively impacted our web interest margin and revenue development throughout every season. Regardless of the changes that are adverse the price environment, we did work against our initial 2018 goals.
Offered the challenging current and expected running environment for banks Rob will touch upon our revised economic targets for 2020 and 2021 in their remarks to spotlight keeping top tier financial performance no matter what the running environment.
Loan growth ended up being 10% annualized for the quarter point-to-point, while normal loans expanded 3%. Q4 is predictably a stronger seasonally in loan development, therefore we saw growth that is significant belated when you look at the quarter. Headwinds to development in Q4 had been a persistent trend of commercial real-estate pay downs staying at elevated amounts, and our decision to run-off the third-party customer loan portfolio, C&I line utilization at about 40% and total commitments both found through the 3rd quarter.