PARKERSBURG - United Bankshares Inc. reported an increase in earnings for the second quarter and the first half of 2012 as compared to the same time periods in 2011. Earnings for the second quarter of 2012 were $21 million or 42 cents per diluted share, up $3.6 million or 21 percent from earnings of $17.5 million or 40 cents per diluted share for the second quarter of 2011. Earnings for the first half of 2012 were $42.1 million or 84 cents per diluted share, an increase of $6.7 million or 19 percent from earnings of $35.3 million or 81 cents per diluted share for the first half of 2011.
Second quarter of 2012 results produced a return on average assets of 1 percent and a return on average equity of 8.58 percent, respectively. For the first half of 2012, United's return on average assets was 1 percent while the return on average equity was 8.60 percent. These returns compare favorably to United's most recently reported Federal Reserve peer group's (bank holding companies with total assets of $3-$10 billion) average return on assets of 0.93 percent and average return on equity of 8.54 percent for the first quarter of 2012. United's annualized returns on average assets and average equity were 0.98 percent and 8.66 percent, respectively, for the second quarter of 2011 while the returns on average assets and average equity was 1.00 percent and 8.85 percent, respectively, for the first half of 2011.
The results for the second quarter and first half of 2012 included noncash, before-tax, other-than-temporary impairment charges of $1.7 million and $3.1 million, respectively, on certain investment securities. The results for the second quarter and first half of 2011 included noncash, before-tax, other-than-temporary impairment charges of $4.1 million and $6.2 million, respectively, on certain investment securities.
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 June 30 compares favorably to the most recently reported percentage of 3.33 percent at March 31 for United's Federal Reserve peer group. At June 30, nonperforming loans were $77.6 million, down from nonperforming loans of $79.7 million or 1.28 percent of loans, net of unearned income, at Dec. 31, 2011. As of June 30, the allowance for loan losses was $73.4 million or 1.16 percent of loans, net of unearned income, which was comparable 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 94.64 percent and 92.73 percent at June 30 and Dec. 31, 2011, respectively. The coverage ratio for United's Federal Reserve peer group was 85.99 percent at March 31. Total nonperforming assets of $126.2 million, including OREO of $48.6 million at June 30, 2012, represented 1.49 percent of total assets, which also compares favorably to the most recently reported percentage of 2.62 percent at March 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 percent at June 30 while its Tier I capital and leverage ratios are 12.8 percent and 10.5 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," stated Richard M. Adams, United's chairman and chief executive officer. "United also continues to be well-capitalized based upon regulatory guidelines."