PARKERSBURG - United Bankshares Inc. on Thursday reported an increase in earnings for the first quarter of 2012 as compared to the first quarter of 2011.
Earnings for the first quarter of 2012 were $21 million or 42 cents per diluted share while earnings for the first quarter of 2011 were $17.9 million or 41 cents per diluted share.
United's first quarter of 2012 results produced an annualized return on average assets of 1 percent and an annualized return on average equity of 8.63 percent. These returns favorably compare to United's most recently reported peer group banking companies' (bank holding companies with total assets between $3 and $10 billion) average return on assets of .81 percent and average return on equity of 7.26 percent for 2011. United's annualized returns on average assets and average equity were 1.02 percent and 9.04 percent, respectively, for the first quarter of 2011.
United's asset quality also continues to outperform its peers. United's percentage of nonperforming loans to loans, net of unearned income of 1.23 percent at March 31 compares favorably to the most recently reported percentage of 3.37 percent at Dec. 31 for United's Federal Reserve peer group. At March 31, nonperforming loans were $76.2 million as compared to nonperforming loans of $79.7 million or 1.28 percent of loans, net of unearned income, at Dec. 31, 2011. As of March 31, the allowance for loan losses was $74 million or 1.19 percent of loans, net of unearned income, as compared to $73.9 million or 1.18 percent of loans, net of unearned income, at Dec. 31, 2011. United's coverage ratio of its allowance for loan losses to nonperforming loans also compares favorably to its peers.
The coverage ratio for United was 97.1 percent and 92.7 percent at March 31 and Dec. 31 respectively. The coverage ratio for United's Federal Reserve peer group was 93.3 percent at Dec. 31. Total nonperforming assets of $126.1 million, including OREO of $49.9 million at March 31 represented 1.48 percent of total assets which also favorably compares to the most recently reported percentage of 2.87 percent at Dec. 31 for United's Federal Reserve peer group.
United continues to be well-capitalized based upon regulatory guidelines. United's estimated risk-based capital ratio is 14.1 percent at March 31 while its estimated Tier I capital and leverage ratios are 12.8 percent and 10.4 percent, respectively. The regulatory requirements for a well-capitalized financial institution are a risk-based capital ratio of 10 percent, a Tier I capital ratio of 6 percent and a leverage ratio of 5 percent.
"United's earnings continue to be strong with solid asset quality favorable to peers," said Richard M. Adams, United's chairman of the board and chief executive officer. "United also continues to be well-capitalized based upon regulatory guidelines."
Tax-equivalent net interest income for the first quarter of 2012 was $70.6 million, an increase of $9.8 million or 16 percent from the first quarter of 2011. This increase in tax-equivalent net interest income was primarily attributable to an increase in average earning assets from the Centra acquisition. Average earning assets increased $1.2 billion or 20 percent from the first quarter of 2011. Average net loans increased $994.8 million or 19 percent for the first quarter of 2012. In addition, the average cost of funds declined 31 basis points from the first quarter of 2011. Partially offsetting the increases to tax-equivalent net interest income for the first quarter of 2012 was a decline of 39 basis points in the average yield on earning assets for the first quarter of 2012 as compared to the same quarter in 2011. The net interest margin for the first quarter of 2012 was 3.78 percent, which was a decrease of 14 basis points from a net interest margin of 3.92 percent for the first quarter of 2011.