Atlantic Union Bankshares Reports Third Quarter Financial Results

Source: Nasdaq GlobeNewswire / 20 Oct 2022 07:30:01 America/New_York

RICHMOND, Va., Oct. 20, 2022 (GLOBE NEWSWIRE) -- Atlantic Union Bankshares Corporation (the “Company” or “Atlantic Union”) (Nasdaq: AUB) reported net income available to common shareholders of $55.1 million and basic and diluted earnings per common share of $0.74 for the third quarter ended September 30, 2022. Adjusted operating earnings available to common shareholders⁽¹⁾ were $55.1 million, diluted adjusted operating earnings per common share⁽¹⁾ were $0.74, and pre-tax pre-provision adjusted operating earnings available to common shareholders⁽¹⁾ were $73.4 million for the third quarter ended September 30, 2022.

“We believe the third quarter financial results show that Atlantic Union Bankshares is delivering on what we said we would do - with upper single digit annualized loan growth, double digit deposit growth, strong credit quality, an expanding net interest margin and positive operating leverage,” said John C. Asbury, president and chief executive officer of Atlantic Union. “We continue to see resiliency and positive market dynamics in our footprint, which combined with our asset sensitivity, gives us confidence in our ability to achieve our top tier financial targets.”

“Operating under the mantra of soundness, profitability and growth – in that order of priority - Atlantic Union remains committed to generating sustainable, profitable growth and building long term value for our shareholders.”

NET INTEREST INCOME

For the third quarter of 2022, net interest income was $150.7 million, an increase of $11.9 million from $138.8 million for the second quarter of 2022. Net interest income (FTE)⁽¹⁾ was $154.6 million in the third quarter of 2022, an increase of $12.2 million from the second quarter of 2022. The increases in net interest income and net interest income (FTE)⁽¹⁾ were primarily driven by increases in loan yields on the Company’s variable rate loans due to higher market interest rates, higher interest income due to average loan growth from the prior quarter, and the additional day count in the third quarter, compared to the second quarter. These increases were partially offset by decreases in Paycheck Protection Program (“PPP)” and fair value accretion interest income and increases in deposit and borrowing costs as a result of increases in short-term market rates and average deposit growth from the prior quarter. The third quarter net interest margin increased 19 basis points from the prior quarter to 3.34% at September 30, 2022, and the net interest margin (FTE)⁽¹⁾ increased 19 basis points during the same period to 3.43%. Earning asset yields increased by 42 basis points in the third quarter of 2022 compared to the second quarter due to the impact of rising market interest rates on loans and investment securities yields. The cost of funds increased from the prior quarter by 23 basis points to 45 basis points at September 30, 2022, driven by higher deposit and borrowing costs as noted above.

The Company’s net interest margin (FTE) ⁽¹⁾ includes the impact of acquisition accounting fair value adjustments. Net accretion related to acquisition accounting was $1.1 million for the quarter ended September 30, 2022, representing a decrease of $1.6 million from the prior quarter. The first, second, and third quarters of 2022 and the remaining estimated net accretion impact are reflected in the following table (dollars in thousands):



	Loan		Deposit			Borrowings
	Accretion		Amortization			Amortization			Total
For the quarter ended March 31, 2022	$	2,253	$	(10	)	$	(203	)	$	2,040
For the quarter ended June 30, 2022		2,879		(11	)		(207	)		2,661
For the quarter ended September 30, 2022		1,326		(11	)		(209	)		1,106
For the remaining three months of 2022 (estimated)		945		(12	)		(208	)		725
For the years ending (estimated):
2023		3,338		(31	)		(852	)		2,455
2024		2,714		(4	)		(877	)		1,833
2025		2,123		(1	)		(900	)		1,222
2026		1,707		—			(926	)		781
2027		1,306		—			(953	)		353
Thereafter		6,469		—			(7,994	)		(1,525	)
Total remaining acquisition accounting fair value adjustments at September 30, 2022	$	18,602	$	(48	)	$	(12,710	)	$	5,844

ASSET QUALITY

Overview
During the third quarter of 2022, nonperforming assets (“NPAs”) as a percentage of loans remained low at 0.21% at September 30, 2022. Accruing past due loan levels as a percentage of total loans held for investment at September 30, 2022 totaled 21 basis points, which was a 6 basis point increase from June 30, 2022, and a 9 basis point decrease from September 30, 2021. Net charge-off levels remained low at 0.02% of total average loans (annualized) for the third quarter of 2022. The allowance for credit losses (“ACL”) totaled $119.0 million at September 30, 2022, a $5.8 million increase from the prior quarter.

Nonperforming Assets
At September 30, 2022, NPAs totaled $28.6 million, a decrease of $2.5 million from June 30, 2022. The following table shows a summary of NPA balances at the quarter ended (dollars in thousands):


	September 30,		June 30,		March 31,		December 31,		September 30,
	2022		2022		2022		2021		2021
Nonaccrual loans	$	26,500	$	29,070	$	29,032	$	31,100	$	35,472
Foreclosed properties		2,087		2,065		1,696		1,696		1,696
Total nonperforming assets	$	28,587	$	31,135	$	30,728	$	32,796	$	37,168

The following table shows the activity in nonaccrual loans for the quarter ended (dollars in thousands):


	September 30,			June 30,			March 31,			December 31,			September 30,
	2022			2022			2022			2021			2021
Beginning Balance	$	29,070		$	29,032		$	31,100		$	35,472		$	36,399
Net customer payments		(3,725	)		(2,472	)		(4,132	)		(5,068	)		(4,719	)
Additions		1,302			3,203			2,087			1,294			4,177
Charge-offs		(125	)		(311	)		(23	)		(598	)		(385	)
Transfers to foreclosed property		(22	)		(382	)		—			—			—
Ending Balance	$	26,500		$	29,070		$	29,032		$	31,100		$	35,472

Past Due Loans
Past due loans still accruing interest totaled $29.0 million or 0.21% of total loans held for investment at September 30, 2022, compared to $20.4 million or 0.15% of total loans held for investment at June 30, 2022, and $38.8 million or 0.30% of total loans held for investment at September 30, 2021. The increase in past due loan levels in the third quarter of 2022 as compared to the second quarter of 2022 was primarily due to increases in past due credit relationships within the commercial real estate – owner occupied and commercial and industrial portfolios. Of the total past due loans still accruing interest, $7.4 million or 0.05% of total loans held for investment were loans past due 90 days or more at September 30, 2022, compared to $4.6 million or 0.03% of total loans held for investment at June 30, 2022, and $11.0 million or 0.08% of total loans held for investment at September 30, 2021.

Allowance for Credit Losses
At September 30, 2022, the ACL was $119.0 million and included an allowance for loan and lease losses (“ALLL”) of $108.0 million and a reserve for unfunded commitments (“RUC”) of $11.0 million. The ACL at September 30, 2022 increased $5.8 million from June 30, 2022, primarily due to increased uncertainty in the macroeconomic outlook and the impact of loan growth in the third quarter of 2022.

The ACL as a percentage of total loans increased to 0.86% at September 30, 2022, compared to 0.83% at June 30, 2022. The ALLL as a percentage of total loans was 0.78% at September 30, 2022, compared to 0.76% at June 30, 2022.

Net Charge-offs
Net charge-offs were $587,000 or 0.02% of total average loans on an annualized basis for the quarter ended September 30, 2022, compared to $939,000 or 0.03% (annualized) for the second quarter of 2022, and $113,000 or less than 0.01% (annualized) for the third quarter of 2021. On a year-to-date basis through September 30, 2022, net charge-offs totaled $1.5 million or 0.02% of total average loans (annualized).

Provision for Credit Losses
For the quarter ended September 30, 2022, the Company recorded a provision for credit losses of $6.4 million, compared to a provision for credit losses of $3.6 million in the previous quarter, and a negative provision for credit losses of $18.8 million recorded during the same quarter in 2021. The provision for credit losses for the third quarter of 2022 reflected a provision of $4.4 million for loan and lease losses and a $2.0 million reserve for unfunded commitments.

NONINTEREST INCOME

Noninterest income decreased $12.7 million to $25.6 million for the quarter ended September 30, 2022 from $38.3 million in the prior quarter, primarily due to the impact of the sale of Dixon, Hubard, Feinour & Brown, Inc. (“DHFB”), as the prior quarter included a $9.1 million pre-tax gain on the transaction within other operating income. In addition, the current quarter’s fiduciary and asset management fees decreased $2.8 million from the prior quarter due to a decrease in assets under management primarily driven by the DHFB sale. Other decreases from the prior quarter include a $1.3 million decrease in service charges on deposit accounts, reflective of the changes to the Company’s overdraft policy, a $810,000 decrease in mortgage banking income due to a decline in mortgage origination volumes and lower gain on sales margins, and a $550,000 reduction in loan related interest rate swap fee income driven by a decrease in average transaction swap fees. These noninterest income category decreases were partially offset by increases of $819,000 primarily related to syndication, foreign exchange, and other capital market transaction fees, included in other operating income, an increase of $729,000 in bank owned life insurance income due to mortality benefits, and an increase of $193,000 in interchange fees.

NONINTEREST EXPENSE

Noninterest expense increased to $99.9 million for the quarter ended September 30, 2022 from $98.8 million in the prior quarter, primarily driven by a $1.3 million increase in salaries and benefits expense due primarily to elevated new hire recruiting expenses and lower deferred loan origination costs resulting from changes in loan originations production mix from the prior quarter. In addition, other expenses increased from the prior quarter by $1.1 million primarily driven by OREO gains of $631,000 realized in the prior quarter. The increases to noninterest expense were partially offset by a $1.2 million decline in professional services expense primarily driven by lower strategic project costs.

INCOME TAXES

The effective tax rate for the three months ended September 30, 2022 was 17.0%, compared to 16.7% for the three months ended June 30, 2022, as the prior quarter reflected the impact of discrete items related to the sale of DHFB.

BALANCE SHEET

At September 30, 2022, total assets were $20.0 billion, an increase of $288.4 million or approximately 5.8% (annualized) from June 30, 2022, and an increase of $14.6 million or approximately 0.1% from September 30, 2021. Total assets increased from the prior quarter due to the increase in total loans held for investment (net of deferred fees and costs) of $263.3 million driven by loan growth, as well as an increase in cash and cash equivalents of $150.0 million due to deposit growth, partially offset by a decline in the investment securities portfolio of $179.4 million primarily related to the impact of market interest rate increases on the market value of the available for sale securities portfolio.

At September 30, 2022, loans held for investment (net of deferred fees and costs) totaled $13.9 billion, including $12.1 million in PPP loans, an increase of $263.3 million or 7.7% (annualized) from $13.7 billion, including $21.7 million in PPP loans, at June 30, 2022. Average loans held for investment (net of deferred fees and costs) totaled $13.7 billion at September 30, 2022, an increase of $207.9 million or 6.1% (annualized) from the prior quarter. Excluding the effects of the PPP⁽¹⁾, adjusted loans held for investment (net of deferred fees and costs) at September 30, 2022 increased $272.9 million or 7.9% (annualized) from June 30, 2022 and adjusted average loans increased $237.0 million or 7.0% (annualized) from the prior quarter. At September 30, 2022, loans held for investment (net of deferred fees and costs) increased $779.1 million or 5.9% from September 30, 2021, and quarterly average loans increased $281.8 million or 2.1% from the same period in the prior year. Excluding the effects of the PPP⁽¹⁾, adjusted loans held for investment (net of deferred fees and costs) at September 30, 2022 increased $1.2 billion or 9.7% from the same period in the prior year, and adjusted quarterly average loans during the third quarter of 2022 increased $954.8 million or 7.5% from the same period in the prior year.

At September 30, 2022, total deposits were $16.5 billion, an increase of $417.6 million or approximately 10.3% (annualized) from June 30, 2022. Average deposits at September 30, 2022 also increased from the prior quarter by $297.2 million or 7.3% (annualized). Total deposits at September 30, 2022 decreased $75.9 million or 0.5% from September 30, 2021, and quarterly average deposits at September 30, 2022 decreased $229.9 million or 1.4% from the same period in the prior year. The decrease in total deposits from the prior year was primarily due to maturing high cost time deposits.

The following table shows the Company’s capital ratios at the quarters ended:


	September 30,		June 30,		September 30,
	2022		2022		2021
Common equity Tier 1 capital ratio ⁽²⁾	9.96	%	9.96	%	10.37	%
Tier 1 capital ratio ⁽²⁾	10.98	%	11.00	%	11.49	%
Total capital ratio ⁽²⁾	13.80	%	13.86	%	13.78	%
Leverage ratio (Tier 1 capital to average assets) ⁽²⁾	9.32	%	9.26	%	8.97	%
Common equity to total assets	10.60	%	11.32	%	12.68	%
Tangible common equity to tangible assets ⁽¹⁾	6.11	%	6.78	%	8.16	%

For the quarter ended September 30, 2022, the Company’s common equity to total assets capital ratio and the tangible common equity to tangible assets capital ratio decreased from the prior quarter and prior year primarily due to the unrealized losses on the available for sale securities portfolio recorded in other comprehensive income due to market interest rate increases in the third quarter of 2022.

During the third quarter of 2022, the Company declared and paid a quarterly dividend on the outstanding shares of Series A Preferred Stock of $171.88 per share (equivalent to $0.43 per outstanding depositary share), consistent with the second quarter of 2022 and the third quarter of 2021. During the third quarter of 2022, the Company also declared and paid cash dividends of $0.30 per common share, an increase of $0.02 or approximately 7.1% from the second quarter of 2022 and the third quarter of 2021.

⁽¹⁾ These are financial measures not calculated in accordance with generally accepted accounting principles (“GAAP”). For a reconciliation of these non-GAAP financial measures, see Alternative Performance Measures (non-GAAP) section of the Key Financial Results.

⁽²⁾ All ratios at September 30, 2022 are estimates and subject to change pending the Company’s filing of its FR Y9-C. All other periods are presented as filed.

ABOUT ATLANTIC UNION BANKSHARES CORPORATION

Headquartered in Richmond, Virginia, Atlantic Union Bankshares Corporation (Nasdaq: AUB) is the holding company for Atlantic Union Bank. Atlantic Union Bank has 114 branches and approximately 130 ATMs located throughout Virginia, and in portions of Maryland and North Carolina. Certain non-bank financial services affiliates of Atlantic Union Bank include: Atlantic Union Equipment Finance, Inc., which provides equipment financing; Atlantic Union Financial Consultants, LLC, which provides brokerage services; and Union Insurance Group, LLC, which offers various lines of insurance products.

THIRD QUARTER 2022 EARNINGS RELEASE CONFERENCE CALL

The Company will hold a conference call and webcast for investors at 9:00 a.m. Eastern Time on Thursday, October 20, 2022 during which management will review the financial results for the three and nine months ended September 30, 2022 and provide an update on recent activities.

The listen-only webcast and the accompanying slides can be accessed at:
https://edge.media-server.com/mmc/p/st4hi3qy.

For analysts who wish to participate in the call, please register at the following URL:
https://register.vevent.com/register/BI0d0b7ad4bc21407885cc5e244e5d623f. To participate in the conference call, you must use the link to receive an audio dial-in number and an Access PIN.

A replay of the webcast, and the accompanying slides, will be available on the Company’s website for 90 days at: https://investors.atlanticunionbank.com/.
NON-GAAP FINANCIAL MEASURES

In reporting the results as of and for the periods ended September 30, 2022, the Company has provided supplemental performance measures on a tax-equivalent, tangible, operating, adjusted or pre-tax pre-provision basis. These non-GAAP financial measures are a supplement to GAAP, which is used to prepare the Company’s financial statements, and should not be considered in isolation or as a substitute for comparable measures calculated in accordance with GAAP. In addition, the Company’s non-GAAP financial measures may not be comparable to non-GAAP financial measures of other companies. The Company uses the non-GAAP financial measures discussed herein in its analysis of the Company’s performance. The Company’s management believes that these non-GAAP financial measures provide additional understanding of ongoing operations, enhance comparability of results of operations with prior periods and show the effects of significant gains and charges in the periods presented without the impact of items or events that may obscure trends in the Company’s underlying performance. For a reconciliation of these measures to their most directly comparable GAAP measures and additional information about these non-GAAP financial measures, see “Alternative Performance Measures (non-GAAP)” in the tables within the section “Key Financial Results.”

FORWARD-LOOKING STATEMENTS

Certain statements in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include, without limitation, statements made in Mr. Asbury’s quotes, statements regarding the Company’s outlook on future economic conditions and the impacts of the current economic uncertainties, estimates with respect to the remaining net accretion related to acquisition accounting, statements that include, projections, predictions, expectations, or beliefs about future events or results, including the Company’s ability to meet its top tier financial targets, or otherwise that are not statements of historical fact. Such forward-looking statements are based on certain assumptions as of the time they are made, and are inherently subject to known and unknown risks, uncertainties, and other factors, some of which cannot be predicted or quantified, that may cause actual results, performance, or achievements to be materially different from those expressed or implied by such forward-looking statements. Such statements are often characterized by the use of qualified words (and their derivatives) such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” “intend,” “will,” “may,” “view,” “opportunity,” “potential,” “continue,” “confidence,” or words of similar meaning or other statements concerning opinions or judgment of the Company and its management about future events. Although the Company believes that its expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of its existing knowledge of its business and operations, there can be no assurance that actual future results, performance, or achievements of, or trends affecting, the Company will not differ materially from any projected future results, performance, achievements or trends expressed or implied by such forward-looking statements. Actual future results, performance, achievements or trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to the effects of or changes in:

market interest rates and the impacts on macroeconomic conditions, customer and client behavior, the Company’s funding costs and the Company’s loan and securities portfolio;
inflation and its impacts on economic growth and customer and client behavior;
general economic and financial market conditions, in the United States generally and particularly in the markets in which the Company operates and which its loans are concentrated, including the effects of declines in real estate values, an increase in unemployment levels and slowdowns in economic growth;
monetary and fiscal policies of the U.S. government, including policies of the U.S. Department of the Treasury and the Federal Reserve;
the quality or composition of the Company’s loan or investment portfolios and changes therein;
demand for loan products and financial services in the Company’s market areas;
the Company’s ability to manage its growth or implement its growth strategy;
the effectiveness of expense reduction plans;
the introduction of new lines of business or new products and services;
the Company’s ability to recruit and retain key employees;
real estate values in the Company’s lending area;
an insufficient ACL;
changes in accounting principles, standards, rules, and interpretations, and the related impact on the Company’s financial statements;
volatility in the ACL resulting from the CECL methodology, either alone or as that may be affected by conditions arising out of the COVID-19 pandemic, inflation, changing interest rates, or other factors;
the Company’s liquidity and capital positions;
concentrations of loans secured by real estate, particularly commercial real estate;
the effectiveness of the Company’s credit processes and management of the Company’s credit risk;
the Company’s ability to compete in the market for financial services and increased competition from fintech companies;
technological risks and developments, and cyber threats, attacks, or events;
operational, technological, cultural, regulatory, legal, credit, and other risks associated with the exploration, consummation and integration of potential future acquisitions, whether involving stock or cash considerations;
the potential adverse effects of unusual and infrequently occurring events, such as weather-related disasters, terrorist acts, geopolitical conflicts (such as the ongoing conflict between Russia and Ukraine) or public health events (such as COVID-19), and of governmental and societal responses thereto; these potential adverse effects may include, without limitation, adverse effects on the ability of the Company's borrowers to satisfy their obligations to the Company, on the value of collateral securing loans, on the demand for the Company's loans or its other products and services, on supply chains and methods used to distribute products and services, on incidents of cyberattack and fraud, on the Company’s liquidity or capital positions, on risks posed by reliance on third-party service providers, on other aspects of the Company's business operations and on financial markets and economic growth;
the effect of steps the Company takes in response to the COVID-19 pandemic, the severity and duration of the pandemic, the uncertainty regarding new variants of COVID-19 that have emerged, the speed and efficacy of vaccine and treatment developments, the impact of loosening or tightening of government restrictions, the pace of recovery when the pandemic subsides and the heightened impact it has on many of the risks described herein;
the discontinuation of LIBOR and its impact on the financial markets, and the Company’s ability to manage operational, legal, and compliance risks related to the discontinuation of LIBOR and implementation of one or more alternate reference rates;
performance by the Company’s counterparties or vendors;
deposit flows;
the availability of financing and the terms thereof;
the level of prepayments on loans and mortgage-backed securities;
legislative or regulatory changes and requirements;
potential claims, damages, and fines related to litigation or government actions;
the effects of changes in federal, state or local tax laws and regulations;
any event or development that would cause the Company to conclude that there was an impairment of any asset, including intangible assets, such as goodwill; and
other factors, many of which are beyond the control of the Company.

Please also refer to such other factors as discussed throughout Part I, Item 1A. “Risk Factors” and Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and related disclosures in other filings, which have been filed with the U.S. Securities and Exchange Commission (“SEC”) and are available on the SEC’s website at www.sec.gov. All risk factors and uncertainties described herein and therein should be considered in evaluating forward-looking statements, all forward-looking statements made in this press release are expressly qualified by the cautionary statements contained or referred to herein and therein. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on the Company or its businesses or operations. Readers are cautioned not to rely too heavily on the forward-looking statements contained in the press release, and undue reliance should not be placed on such forward-looking statements. Forward-looking statements speak only as of the date they are made. The Company does not intend or assume any obligation to update, revise or clarify any forward-looking statements that may be made from time to time by or on behalf of the Company, whether as a result of new information, future events or otherwise.

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES
KEY FINANCIAL RESULTS (UNAUDITED)
(Dollars in thousands, except share data)


	As of & For Three Months Ended										As of & For Nine Months Ended
	09/30/22			06/30/22			09/30/21				09/30/22			09/30/21
Results of Operations
Interest and dividend income	$	171,156		$	148,755		$	146,379			$	458,367		$	444,904
Interest expense		20,441			9,988			8,891				37,954			31,970
Net interest income		150,715			138,767			137,488				420,413			412,934
Provision for credit losses		6,412			3,559			(18,850	)			12,771			(59,888	)
Net interest income after provision for credit losses		144,303			135,208			156,338				407,642			472,822
Noninterest income		25,584			38,286			29,938				94,023			89,388
Noninterest expenses		99,923			98,768			95,343				304,012			299,251
Income before income taxes		69,964			74,726			90,933				197,653			262,959
Income tax expense		11,894			12,500			16,368				33,667			46,821
Net income		58,070			62,226			74,565				163,986			216,138
Dividends on preferred stock		2,967			2,967			2,967				8,901			8,901
Net income available to common shareholders	$	55,103		$	59,259		$	71,598			$	155,085		$	207,237

Interest earned on earning assets (FTE) ⁽¹⁾	$	174,998		$	152,332		$	149,543			$	469,122		$	454,265
Net interest income (FTE) ⁽¹⁾		154,557			142,344			140,652				431,168			422,295
Total revenue (FTE) ⁽¹⁾		180,141			180,630			170,590				525,191			511,683
Pre-PPP total adjusted revenue (FTE) ^{(1) (10)}		179,687			170,204			159,408				511,325			474,790
Pre-tax pre-provision adjusted operating earnings ⁽⁸⁾		76,376			69,205			72,074				206,852			218,581
Pre-PPP pre-tax pre-provision adjusted operating earnings ^{(8) (10)}		75,922			67,859			60,901				202,066			181,775

Key Ratios
Earnings per common share, diluted	$	0.74		$	0.79		$	0.94			$	2.07		$	2.66
Return on average assets (ROA)		1.15	%		1.27	%		1.47		%		1.10	%		1.45		%
Return on average equity (ROE)		9.45	%		10.21	%		10.88		%		8.72	%		10.59		%
Return on average tangible common equity (ROTCE) ^{(2) (3)}		17.21	%		18.93	%		18.79		%		15.69	%		18.31		%
Efficiency ratio		56.68	%		55.78	%		56.95		%		59.10	%		59.57		%
Efficiency ratio (FTE) ⁽¹⁾		55.47	%		54.68	%		55.89		%		57.89	%		58.48		%
Net interest margin		3.34	%		3.15	%		3.05		%		3.16	%		3.10		%
Net interest margin (FTE) ⁽¹⁾		3.43	%		3.24	%		3.12		%		3.24	%		3.17		%
Yields on earning assets (FTE) ⁽¹⁾		3.88	%		3.46	%		3.31		%		3.52	%		3.41		%
Cost of interest-bearing liabilities		0.68	%		0.35	%		0.30		%		0.43	%		0.36		%
Cost of deposits		0.37	%		0.15	%		0.14		%		0.21	%		0.18		%
Cost of funds		0.45	%		0.22	%		0.19		%		0.28	%		0.24		%

Operating Measures⁽⁴⁾
Adjusted operating earnings	$	58,070		$	54,244		$	74,558			$	160,355		$	228,391
Adjusted operating earnings available to common shareholders		55,103			51,277			71,591				151,454			219,490
Adjusted operating earnings per common share, diluted	$	0.74		$	0.69		$	0.94			$	2.02		$	2.81
Adjusted operating ROA		1.15	%		1.10	%		1.47		%		1.08	%		1.54		%
Adjusted operating ROE		9.45	%		8.90	%		10.88		%		8.53	%		11.19		%
Adjusted operating ROTCE ^{(2) (3)}		17.21	%		16.47	%		18.79		%		15.34	%		19.35		%
Adjusted operating efficiency ratio (FTE) ⁽¹⁾⁽⁷⁾		54.09	%		55.88	%		53.91		%		56.20	%		53.36		%

Per Share Data
Earnings per common share, basic	$	0.74		$	0.79		$	0.94			$	2.07		$	2.66
Earnings per common share, diluted		0.74			0.79			0.94				2.07			2.66
Cash dividends paid per common share		0.30			0.28			0.28				0.86			0.81
Market value per share		30.38			33.92			36.85				30.38			36.85
Book value per common share		28.46			29.95			33.60				28.46			33.60
Tangible book value per common share ⁽²⁾		15.61			17.07			20.55				15.61			20.55
Price to earnings ratio, diluted		10.37			10.68			9.88				10.99			10.36
Price to book value per common share ratio		1.07			1.13			1.10				1.07			1.10
Price to tangible book value per common share ratio ⁽²⁾		1.95			1.99			1.79				1.95			1.79
Weighted average common shares outstanding, basic		74,703,699			74,847,899			76,309,355				75,029,000			77,988,151
Weighted average common shares outstanding, diluted		74,705,054			74,849,871			76,322,736				75,034,084			78,007,543
Common shares outstanding at end of period		74,703,774			74,688,314			75,645,031				74,703,774			75,645,031

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES
KEY FINANCIAL RESULTS (UNAUDITED)
(Dollars in thousands, except share data)


	As of & For Three Months Ended									As of & For Nine Months Ended
	09/30/22			06/30/22			09/30/21			09/30/22			09/30/21
Capital Ratios
Common equity Tier 1 capital ratio ⁽⁵⁾		9.96	%		9.96	%		10.37	%		9.96	%		10.37	%
Tier 1 capital ratio ⁽⁵⁾		10.98	%		11.00	%		11.49	%		10.98	%		11.49	%
Total capital ratio ⁽⁵⁾		13.80	%		13.86	%		13.78	%		13.80	%		13.78	%
Leverage ratio (Tier 1 capital to average assets) ⁽⁵⁾		9.32	%		9.26	%		8.97	%		9.32	%		8.97	%
Common equity to total assets		10.60	%		11.32	%		12.68	%		10.60	%		12.68	%
Tangible common equity to tangible assets ⁽²⁾		6.11	%		6.78	%		8.16	%		6.11	%		8.16	%

Financial Condition
Assets	$	19,950,231		$	19,661,799		$	19,935,657		$	19,950,231		$	19,935,657
Loans held for investment (net of deferred fees and costs)		13,918,720			13,655,408			13,139,586			13,918,720			13,139,586
Securities		3,640,722			3,820,078			3,807,723			3,640,722			3,807,723
Earning Assets		17,790,324			17,578,979			17,795,784			17,790,324			17,795,784
Goodwill		925,211			925,211			935,560			925,211			935,560
Amortizable intangibles, net		29,142			31,621			46,537			29,142			46,537
Deposits		16,546,216			16,128,635			16,622,160			16,546,216			16,622,160
Borrowings		669,558			797,948			385,765			669,558			385,765
Stockholders' equity		2,281,150			2,391,476			2,694,439			2,281,150			2,694,439
Tangible common equity ⁽²⁾		1,160,440			1,268,287			1,545,985			1,160,440			1,545,985

Loans held for investment, net of deferred fees and costs
Construction and land development	$	1,068,201		$	988,379		$	877,351		$	1,068,201		$	877,351
Commercial real estate - owner occupied		1,953,872			1,965,702			2,027,299			1,953,872			2,027,299
Commercial real estate - non-owner occupied		3,900,325			3,860,819			3,730,720			3,900,325			3,730,720
Multifamily real estate		774,970			762,502			776,287			774,970			776,287
Commercial & Industrial		2,709,047			2,595,891			2,580,190			2,709,047			2,580,190
Residential 1-4 Family - Commercial		542,612			553,771			624,347			542,612			624,347
Residential 1-4 Family - Consumer		891,353			865,174			822,971			891,353			822,971
Residential 1-4 Family - Revolving		588,452			583,073			557,803			588,452			557,803
Auto		561,277			525,301			425,436			561,277			425,436
Consumer		172,776			180,045			182,039			172,776			182,039
Other Commercial		755,835			774,751			535,143			755,835			535,143
Total loans held for investment	$	13,918,720		$	13,655,408		$	13,139,586		$	13,918,720		$	13,139,586

Deposits
Interest checking accounts	$	4,354,351		$	3,943,303		$	4,016,505		$	4,354,351		$	4,016,505
Money market accounts		3,962,473			3,956,050			4,152,986			3,962,473			4,152,986
Savings accounts		1,173,566			1,165,577			1,079,735			1,173,566			1,079,735
Time deposits of $250,000 and over		415,984			360,158			546,199			415,984			546,199
Other time deposits		1,348,904			1,342,009			1,497,897			1,348,904			1,497,897
Time deposits		1,764,888			1,702,167			2,044,096			1,764,888			2,044,096
Total interest-bearing deposits	$	11,255,278		$	10,767,097		$	11,293,322		$	11,255,278		$	11,293,322
Demand deposits		5,290,938			5,361,538			5,328,838			5,290,938			5,328,838
Total deposits	$	16,546,216		$	16,128,635		$	16,622,160		$	16,546,216		$	16,622,160

Averages
Assets	$	19,980,500		$	19,719,402		$	20,056,570		$	19,873,644		$	19,890,155
Loans held for investment (net of deferred fees and costs)		13,733,447			13,525,529			13,451,674			13,521,507			13,827,002
Loans held for sale		15,063			20,634			30,035			16,779			43,162
Securities		3,818,607			3,930,912			3,679,977			3,981,308			3,438,285
Earning assets		17,879,222			17,646,470			17,910,389			17,803,550			17,824,607
Deposits		16,488,224			16,191,056			16,718,144			16,397,790			16,433,470
Time deposits		1,745,224			1,667,378			2,109,131			1,726,341			2,288,530
Interest-bearing deposits		11,163,945			10,824,465			11,512,825			11,091,115			11,483,654
Borrowings		703,272			765,886			395,984			660,995			456,184
Interest-bearing liabilities		11,867,217			11,590,351			11,908,809			11,752,110			11,939,838
Stockholders' equity		2,436,999			2,445,045			2,718,032			2,513,522			2,728,605
Tangible common equity ⁽²⁾		1,315,085			1,304,536			1,567,937			1,378,240			1,574,961

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES
KEY FINANCIAL RESULTS (UNAUDITED)
(Dollars in thousands, except share data)


	As of & For Three Months Ended										As of & For Nine Months Ended
	09/30/22			06/30/22			09/30/21				09/30/22			09/30/21
Asset Quality
Allowance for Credit Losses (ACL)
Beginning balance, Allowance for loan and lease losses (ALLL)	$	104,184		$	102,591		$	118,261			$	99,787		$	160,540
Add: Recoveries		1,214			1,018			2,153				3,745			6,498
Less: Charge-offs		1,801			1,957			2,266				5,267			7,852
Add: Provision for loan losses		4,412			2,532			(16,350	)			9,744			(57,388	)
Ending balance, ALLL	$	108,009		$	104,184		$	101,798			$	108,009		$	101,798

Beginning balance, Reserve for unfunded commitment (RUC)	$	9,000		$	8,000		$	10,000			$	8,000		$	10,000
Add: Provision for unfunded commitments		2,000			1,000			(2,500	)			3,000			(2,500	)
Ending balance, RUC	$	11,000		$	9,000		$	7,500			$	11,000		$	7,500
Total ACL	$	119,009		$	113,184		$	109,298			$	119,009		$	109,298

ACL / total outstanding loans		0.86	%		0.83	%		0.83		%		0.86	%		0.83		%
ACL / total adjusted loans⁽⁹⁾		0.86	%		0.83	%		0.86		%		0.86	%		0.86		%
ALLL / total outstanding loans		0.78	%		0.76	%		0.77		%		0.78	%		0.77		%
ALLL / total adjusted loans⁽⁹⁾		0.78	%		0.76	%		0.80		%		0.78	%		0.80		%
Net charge-offs / total average loans		0.02	%		0.03	%		0.00		%		0.02	%		0.01		%
Net charge-offs / total adjusted average loans⁽⁹⁾		0.02	%		0.03	%		0.00		%		0.02	%		0.01		%
Provision for loan losses/ total average loans		0.13	%		0.08	%		(0.48	)	%		0.10	%		(0.55	)	%
Provision for loan losses/ total adjusted average loans⁽⁹⁾		0.13	%		0.08	%		(0.51	)	%		0.10	%		(0.60	)	%

Nonperforming Assets ⁽⁶⁾
Construction and land development	$	421		$	581		$	2,710			$	421		$	2,710
Commercial real estate - owner occupied		4,883			4,996			7,786				4,883			7,786
Commercial real estate - non-owner occupied		1,923			3,301			4,174				1,923			4,174
Multifamily real estate		—			—			113				—			113
Commercial & Industrial		2,289			2,728			2,062				2,289			2,062
Residential 1-4 Family - Commercial		1,962			2,031			2,445				1,962			2,445
Residential 1-4 Family - Consumer		11,121			12,084			12,150				11,121			12,150
Residential 1-4 Family - Revolving		3,583			3,069			3,723				3,583			3,723
Auto		318			279			255				318			255
Consumer		—			1			54				—			54
Nonaccrual loans	$	26,500		$	29,070		$	35,472			$	26,500		$	35,472
Foreclosed property		2,087			2,065			1,696				2,087			1,696
Total nonperforming assets (NPAs)	$	28,587		$	31,135		$	37,168			$	28,587		$	37,168
Construction and land development	$	115		$	1		$	304			$	115		$	304
Commercial real estate - owner occupied		3,517			792			1,886				3,517			1,886
Commercial real estate - non-owner occupied		621			642			1,175				621			1,175
Commercial & Industrial		526			322			1,256				526			1,256
Residential 1-4 Family - Commercial		308			184			1,091				308			1,091
Residential 1-4 Family - Consumer		680			1,112			2,462				680			2,462
Residential 1-4 Family - Revolving		1,255			997			2,474				1,255			2,474
Auto		148			134			209				148			209
Consumer		86			79			173				86			173
Other Commercial		95			329			—				95			—
Loans ≥ 90 days and still accruing	$	7,351		$	4,592		$	11,030			$	7,351		$	11,030
Total NPAs and loans ≥ 90 days	$	35,938		$	35,727		$	48,198			$	35,938		$	48,198
NPAs / total outstanding loans		0.21	%		0.23	%		0.28		%		0.21	%		0.28		%
NPAs / total adjusted loans⁽⁹⁾		0.21	%		0.23	%		0.29		%		0.21	%		0.29		%
NPAs / total assets		0.14	%		0.16	%		0.19		%		0.14	%		0.19		%
ALLL / nonaccrual loans		407.58	%		358.39	%		286.98		%		407.58	%		286.98		%
ALLL/ nonperforming assets		377.83	%		334.62	%		273.89		%		377.83	%		273.89		%

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES
KEY FINANCIAL RESULTS (UNAUDITED)
(Dollars in thousands, except share data)


	As of & For Three Months Ended									As of & For Nine Months Ended
	09/30/22			06/30/22			09/30/21			09/30/22			09/30/21
Past Due Detail ⁽⁶⁾
Construction and land development	$	120		$	645		$	744		$	120		$	744
Commercial real estate - owner occupied		7,337			1,374			735			7,337			735
Commercial real estate - non-owner occupied		—			511			1,302			—			1,302
Commercial & Industrial		796			2,581			11,089			796			11,089
Residential 1-4 Family - Commercial		1,410			1,944			807			1,410			807
Residential 1-4 Family - Consumer		1,123			594			406			1,123			406
Residential 1-4 Family - Revolving		1,115			1,368			1,092			1,115			1,092
Auto		1,876			1,841			1,548			1,876			1,548
Consumer		409			361			790			409			790
Other Commercial		—			11			631			—			631
Loans 30-59 days past due	$	14,186		$	11,230		$	19,144		$	14,186		$	19,144
Construction and land development	$	107		$	—		$	58		$	107		$	58
Commercial real estate - owner occupied		763			807			61			763			61
Commercial real estate - non-owner occupied		457			—			570			457			570
Commercial & Industrial		3,128			546			3,328			3,128			3,328
Residential 1-4 Family - Commercial		97			474			698			97			698
Residential 1-4 Family - Consumer		1,449			1,646			2,188			1,449			2,188
Residential 1-4 Family - Revolving		1,081			731			587			1,081			587
Auto		257			213			202			257			202
Consumer		101			210			317			101			317
Other Commercial		—			—			600			—			600
Loans 60-89 days past due	$	7,440		$	4,627		$	8,609		$	7,440		$	8,609

Past Due and still accruing	$	28,977		$	20,449		$	38,783		$	28,977		$	38,783
Past Due and still accruing / total loans		0.21	%		0.15	%		0.30	%		0.21	%		0.30	%

Troubled Debt Restructurings
Performing	$	10,333		$	10,662		$	11,335		$	10,333		$	11,335
Nonperforming		5,298			7,298			7,365			5,298			7,365
Total troubled debt restructurings	$	15,631		$	17,960		$	18,700		$	15,631		$	18,700

Alternative Performance Measures (non-GAAP)
Net interest income (FTE) ⁽¹⁾
Net interest income (GAAP)	$	150,715		$	138,767		$	137,488		$	420,413		$	412,934
FTE adjustment		3,842			3,577			3,164			10,755			9,361
Net interest income (FTE) (non-GAAP)	$	154,557		$	142,344		$	140,652		$	431,168		$	422,295
Noninterest income (GAAP)		25,584			38,286			29,938			94,023			89,388
Total revenue (FTE) (non-GAAP)	$	180,141		$	180,630		$	170,590		$	525,191		$	511,683

Average earning assets	$	17,879,222		$	17,646,470		$	17,910,389		$	17,803,550		$	17,824,607
Net interest margin		3.34	%		3.15	%		3.05	%		3.16	%		3.10	%
Net interest margin (FTE)		3.43	%		3.24	%		3.12	%		3.24	%		3.17	%

Tangible Assets ⁽²⁾
Ending assets (GAAP)	$	19,950,231		$	19,661,799		$	19,935,657		$	19,950,231		$	19,935,657
Less: Ending goodwill		925,211			925,211			935,560			925,211			935,560
Less: Ending amortizable intangibles		29,142			31,621			46,537			29,142			46,537
Ending tangible assets (non-GAAP)	$	18,995,878		$	18,704,967		$	18,953,560		$	18,995,878		$	18,953,560

Tangible Common Equity ⁽²⁾
Ending equity (GAAP)	$	2,281,150		$	2,391,476		$	2,694,439		$	2,281,150		$	2,694,439
Less: Ending goodwill		925,211			925,211			935,560			925,211			935,560
Less: Ending amortizable intangibles		29,142			31,621			46,537			29,142			46,537
Less: Perpetual preferred stock		166,357			166,357			166,357			166,357			166,357
Ending tangible common equity (non-GAAP)	$	1,160,440		$	1,268,287		$	1,545,985		$	1,160,440		$	1,545,985

Average equity (GAAP)	$	2,436,999		$	2,445,045		$	2,718,032		$	2,513,522		$	2,728,605
Less: Average goodwill		925,211			935,446			935,560			932,035			935,560
Less: Average amortizable intangibles		30,347			38,707			48,179			36,891			51,728
Less: Average perpetual preferred stock		166,356			166,356			166,356			166,356			166,356
Average tangible common equity (non-GAAP)	$	1,315,085		$	1,304,536		$	1,567,937		$	1,378,240		$	1,574,961

ROTCE ⁽²⁾⁽³⁾
Net income available to common shareholders (GAAP)	$	55,103		$	59,259		$	71,598		$	155,085		$	207,237
Plus: Amortization of intangibles, tax effected		1,959			2,303			2,671			6,663			8,436
Net income available to common shareholders before amortization of intangibles (non-GAAP)	$	57,062		$	61,562		$	74,269		$	161,748		$	215,673

Return on average tangible common equity (ROTCE)		17.21	%		18.93	%		18.79	%		15.69	%		18.31	%

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES
KEY FINANCIAL RESULTS (UNAUDITED)
(Dollars in thousands, except share data)


	As of & For Three Months Ended											As of & For Nine Months Ended
	09/30/22			06/30/22				09/30/21				09/30/22				09/30/21
Operating Measures⁽⁴⁾
Net income (GAAP)	$	58,070		$	62,226			$	74,565			$	163,986			$	216,138
Plus: Net loss related to balance sheet repositioning, net of tax		—			—				—				—				11,609
Less: (Loss) gain on sale of securities, net of tax		—			(2	)			7				(2	)			69
Less: Gain on sale of DHFB, net of tax		—			7,984				—				7,984				—
Plus: Branch closing and facility consolidation costs, net of tax		—			—				—				4,351				713
Adjusted operating earnings (non-GAAP)		58,070			54,244				74,558				160,355				228,391
Less: Dividends on preferred stock		2,967			2,967				2,967				8,901				8,901
Adjusted operating earnings available to common shareholders (non-GAAP)	$	55,103		$	51,277			$	71,591			$	151,454			$	219,490

Noninterest expense (GAAP)	$	99,923		$	98,768			$	95,343			$	304,012			$	299,251
Less: Amortization of intangible assets		2,480			2,915				3,381				8,434				10,679
Less: Losses related to balance sheet repositioning		—			—				—				—				14,695
Less: Branch closing and facility consolidation costs		—			—				—				5,508				902
Adjusted operating noninterest expense (non-GAAP)	$	97,443		$	95,853			$	91,962			$	290,070			$	272,975

Noninterest income (GAAP)	$	25,584		$	38,286			$	29,938			$	94,023			$	89,388
Less: (Loss) gain on sale of securities		—			(2	)			9				(2	)			87
Less: Gain on sale of DHFB		—			9,082				—				9,082				—
Adjusted operating noninterest income (non-GAAP)	$	25,584		$	29,206			$	29,929			$	84,943			$	89,301

Net interest income (FTE) (non-GAAP)⁽¹⁾	$	154,557		$	142,344			$	140,652			$	431,168			$	422,295
Adjusted operating noninterest income (non-GAAP)		25,584			29,206				29,929				84,943				89,301
Total adjusted revenue (FTE) (non-GAAP) ⁽¹⁾		180,141			171,550				170,581				516,111				511,596
Less: PPP accretion interest income and fees		454			1,346				11,173				4,786				36,806
Pre-PPP total adjusted revenue (FTE) (non-GAAP) ^{(1) (10)}	$	179,687		$	170,204			$	159,408			$	511,325			$	474,790

Efficiency ratio		56.68	%		55.78		%		56.95		%		59.10		%		59.57		%
Efficiency ratio (FTE) ⁽¹⁾		55.47	%		54.68		%		55.89		%		57.89		%		58.48		%
Adjusted operating efficiency ratio (FTE) ⁽¹⁾⁽⁷⁾		54.09	%		55.88		%		53.91		%		56.20		%		53.36		%

Operating ROA & ROE ⁽⁴⁾
Adjusted operating earnings (non-GAAP)	$	58,070		$	54,244			$	74,558			$	160,355			$	228,391

Average assets (GAAP)	$	19,980,500		$	19,719,402			$	20,056,570			$	19,873,644			$	19,890,155
Return on average assets (ROA) (GAAP)		1.15	%		1.27		%		1.47		%		1.10		%		1.45		%
Adjusted operating return on average assets (ROA) (non-GAAP)		1.15	%		1.10		%		1.47		%		1.08		%		1.54		%

Average equity (GAAP)	$	2,436,999		$	2,445,045			$	2,718,032			$	2,513,522			$	2,728,605
Return on average equity (ROE) (GAAP)		9.45	%		10.21		%		10.88		%		8.72		%		10.59		%
Adjusted operating return on average equity (ROE) (non-GAAP)		9.45	%		8.90		%		10.88		%		8.53		%		11.19		%

Operating ROTCE ^(2)(3)(4)
Adjusted operating earnings available to common shareholders (non-GAAP)	$	55,103		$	51,277			$	71,591			$	151,454			$	219,490
Plus: Amortization of intangibles, tax effected		1,959			2,303				2,671				6,663				8,436
Adjusted operating earnings available to common shareholders before amortization of intangibles (non-GAAP)	$	57,062		$	53,580			$	74,262			$	158,117			$	227,926

Average tangible common equity (non-GAAP)	$	1,315,085		$	1,304,536			$	1,567,937			$	1,378,240			$	1,574,961
Adjusted operating return on average tangible common equity (non-GAAP)		17.21	%		16.47		%		18.79		%		15.34		%		19.35		%

Pre-tax pre-provision adjusted operating earnings ⁽⁸⁾
Net income (GAAP)	$	58,070		$	62,226			$	74,565			$	163,986			$	216,138
Plus: Provision for credit losses		6,412			3,559				(18,850	)			12,771				(59,888	)
Plus: Income tax expense		11,894			12,500				16,368				33,667				46,821
Plus: Net loss related to balance sheet repositioning		—			—				—				—				14,695
Less: (Loss) gain on sale of securities		—			(2	)			9				(2	)			87
Less: Gain on sale of DHFB		—			9,082				—				9,082				—
Plus: Branch closing and facility consolidation costs		—			—				—				5,508				902
Pre-tax pre-provision adjusted operating earnings (non-GAAP)	$	76,376		$	69,205			$	72,074			$	206,852			$	218,581
Less: Dividends on preferred stock		2,967			2,967				2,967				8,901				8,901
Pre-tax pre-provision adjusted operating earnings available to common shareholders (non-GAAP)	$	73,409		$	66,238			$	69,107			$	197,951			$	209,680

Pre-tax pre-provision adjusted operating earnings (non-GAAP)	$	76,376		$	69,205			$	72,074			$	206,852			$	218,581
Less: PPP accretion interest income and fees		454			1,346				11,173				4,786				36,806
Pre-PPP pre-tax pre-provision adjusted operating earnings (non-GAAP) ⁽¹⁰⁾	$	75,922		$	67,859			$	60,901			$	202,066			$	181,775

Weighted average common shares outstanding, diluted		74,705,054			74,849,871				76,322,736				75,034,084				78,007,543
Pre-tax pre-provision earnings per common share, diluted	$	0.98		$	0.88			$	0.91			$	2.64			$	2.69

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES
KEY FINANCIAL RESULTS (UNAUDITED)
(Dollars in thousands, except share data)


	As of & For Three Months Ended									As of & For Nine Months Ended
	09/30/22			06/30/22			09/30/21			09/30/22			09/30/21
Adjusted Loans ⁽⁹⁾
Loans held for investment (net of deferred fees and costs) (GAAP)	$	13,918,720		$	13,655,408		$	13,139,586		$	13,918,720		$	13,139,586
Less: PPP adjustments (net of deferred fees and costs)		12,146			21,749			466,609			12,146			466,609
Total adjusted loans (non-GAAP)	$	13,906,574		$	13,633,659		$	12,672,977		$	13,906,574		$	12,672,977

Average loans held for investment (net of deferred fees and costs) (GAAP)	$	13,733,447		$	13,525,529		$	13,451,674		$	13,521,507		$	13,827,002
Less: Average PPP adjustments (net of deferred fees and costs)		14,280			43,391			687,259			53,246			1,059,130
Total adjusted average loans (non-GAAP)	$	13,719,167		$	13,482,138		$	12,764,415		$	13,468,261		$	12,767,872

Mortgage Origination Held for Sale Volume
Refinance Volume	$	5,637		$	14,916		$	49,154		$	53,753		$	241,401
Purchase Volume		66,360			84,551			93,819			209,206			250,523
Total Mortgage loan originations held for sale	$	71,997		$	99,467		$	142,973		$	262,959		$	491,924
% of originations held for sale that are refinances		7.8	%		15.0	%		34.4	%		20.4	%		49.1	%

Wealth
Assets under management ("AUM")	$	4,065,059		$	4,415,537		$	6,377,518		$	4,065,059		$	6,377,518

Other Data
End of period full-time employees		1,890			1,856			1,918			1,890			1,918
Number of full-service branches		114			114			130			114			130
Number of automatic transaction machines ("ATMs")		131			131			149			131			149

(1)   These are non-GAAP financial measures. Net interest income (FTE) and total adjusted revenue (FTE), which are used in computing net interest margin (FTE), efficiency ratio (FTE) and adjusted operating efficiency ratio (FTE), provide valuable additional insight into the net interest margin and the efficiency ratio by adjusting for differences in tax treatment of interest income sources. The entire FTE adjustment is attributable to interest income on earning assets, which is used in computing yield on earning assets. Interest expense and the related cost of interest-bearing liabilities and cost of funds ratios are not affected by the FTE components.
(2)   These are non-GAAP financial measures. Tangible assets and tangible common equity are used in the calculation of certain profitability, capital, and per share ratios. The Company believes tangible assets, tangible common equity and the related ratios are meaningful measures of capital adequacy because they provide a meaningful base for period-to-period and company-to-company comparisons, which the Company believes will assist investors in assessing the capital of the Company and its ability to absorb potential losses.
(3)   These are non-GAAP financial measures. The Company believes that ROTCE is a meaningful supplement to GAAP financial measures and useful to investors because it measures the performance of a business consistently across time without regard to whether components of the business were acquired or developed internally.
(4)   These are non-GAAP financial measures. Adjusted operating measures exclude the losses related to balance sheet repositioning (principally composed of losses on debt extinguishment), gains or losses on sale of securities, gain on the sale of DHFB, as well as branch closing and facility consolidation costs (principally composed of real estate, leases and other assets write downs, as well as severance associated with branch closing and corporate expense reduction initiatives). The Company believes these non-GAAP adjusted measures provide investors with important information about the continuing economic results of the organization’s operations. Prior periods reflect adjustments for previously announced branch closing and corporate expense reduction initiatives.

(5)   All ratios at September 30, 2022 are estimates and subject to change pending the Company’s filing of its FR Y9-C. All other periods are presented as filed.
(6)   These balances reflect the impact of the CARES Act and the joint guidance issued by the five federal bank regulatory agencies and the Conference of State Bank Supervisors on March 22, 2020, as subsequently revised on April 7, 2020, which provides relief for TDR designations and also provides guidance on past due reporting for modified loans.
(7)   The adjusted operating efficiency ratio (FTE) excludes the amortization of intangible assets, gains or losses on sale of securities, gain on the sale of DHFB, losses related to balance sheet repositioning (principally composed of losses on debt extinguishment), as well as branch closing and facility consolidation costs. This measure is similar to the measure utilized by the Company when analyzing corporate performance and is also similar to the measure utilized for incentive compensation. The Company believes this adjusted measure provides investors with important information about the combined economic results of the organization’s operations. Prior periods reflect adjustments for previously announced branch closing and corporate expense reduction initiatives.
(8)   These are non-GAAP financial measures. Pre-tax pre-provision adjusted earnings excludes the provision for credit losses, which can fluctuate significantly from period-to-period under the CECL methodology, income tax expense, losses related to balance sheet repositioning (principally composed of losses on debt extinguishment), gains or losses on sale of securities, gain on the sale of DHFB, as well as branch closing and facility consolidation costs. The Company believes this adjusted measure provides investors with important information about the combined economic results of the organization’s operations. Prior periods reflect adjustments for previously announced branch closing and corporate expense reduction initiatives.
(9)   These are non-GAAP financial measures. PPP adjustment impact excludes the unforgiven portion of PPP loans. The Company believes loans held for investment (net of deferred fees and costs), excluding PPP is useful to investors as it provides more clarity on the Company’s organic growth. The Company also believes that the related non-GAAP financial measures of past due loans still accruing interest as a percentage of total loans held for investment (net of deferred fees and costs), excluding PPP, are useful to investors as loans originated under the PPP carry a Small Business Administration (“SBA”) guarantee. The Company believes that the ALLL as a percentage of loans held for investment (net of deferred fees and costs), excluding PPP, is useful to investors because of the size of the Company’s PPP originations and the impact of the embedded credit enhancement provided by the SBA guarantee.
(10)   These are non-GAAP financial measures. The Company believes excluding PPP accretion interest income and fees from operating earnings is useful to investors as it provides more clarity on the Company’s non-PPP related income.

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share data)


	September 30,			December 31,		September 30,
	2022			2021		2021
ASSETS		(unaudited)			(audited)		(unaudited)
Cash and cash equivalents:
Cash and due from banks	$	177,969		$	180,963	$	255,648
Interest-bearing deposits in other banks		211,785			618,714		807,225
Federal funds sold		1,188			2,824		377
Total cash and cash equivalents		390,942			802,501		1,063,250
Securities available for sale, at fair value		2,717,323			3,481,650		3,195,176
Securities held to maturity, at carrying value		841,349			628,000		535,722
Restricted stock, at cost		82,050			76,825		76,825
Loans held for sale, at fair value		12,889			20,861		35,417
Loans held for investment, net of deferred fees and costs		13,918,720			13,195,843		13,139,586
Less: allowance for loan and lease losses		108,009			99,787		101,798
Total loans held for investment, net		13,810,711			13,096,056		13,037,788
Premises and equipment, net		126,374			134,808		159,588
Goodwill		925,211			935,560		935,560
Amortizable intangibles, net		29,142			43,312		46,537
Bank owned life insurance		437,988			431,517		430,341
Other assets		576,252			413,706		419,453
Total assets	$	19,950,231		$	20,064,796	$	19,935,657
LIABILITIES
Noninterest-bearing demand deposits	$	5,290,938		$	5,207,324	$	5,328,838
Interest-bearing deposits		11,255,278			11,403,744		11,293,322
Total deposits		16,546,216			16,611,068		16,622,160
Securities sold under agreements to repurchase		146,182			117,870		95,181
Other short-term borrowings		133,800			—		—
Long-term borrowings		389,576			388,724		290,584
Other liabilities		453,307			237,063		233,293
Total liabilities		17,669,081			17,354,725		17,241,218
Commitments and contingencies
STOCKHOLDERS' EQUITY
Preferred stock, $10.00 par value		173			173		173
Common stock, $1.33 par value		98,845			100,101		100,062
Additional paid-in capital		1,769,858			1,807,368		1,804,617
Retained earnings		874,393			783,794		760,164
Accumulated other comprehensive income (loss)		(462,119	)		18,635		29,423
Total stockholders' equity		2,281,150			2,710,071		2,694,439
Total liabilities and stockholders' equity	$	19,950,231		$	20,064,796	$	19,935,657

Common shares outstanding		74,703,774			75,663,648		75,645,031
Common shares authorized		200,000,000			200,000,000		200,000,000
Preferred shares outstanding		17,250			17,250		17,250
Preferred shares authorized		500,000			500,000		500,000

ATLANTIC UNION BANKSHARES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Dollars in thousands, except share data)


	Three Months Ended							Nine Months Ended
	September 30,		June 30,		September 30,			September 30,		September 30,
	2022		2022		2021			2022		2021
Interest and dividend income:
Interest and fees on loans	$	144,673	$	123,266	$	124,999		$	382,139	$	383,575
Interest on deposits in other banks		941		157		291			1,229		454
Interest and dividends on securities:
Taxable		14,750		14,695		11,230			43,110		32,102
Nontaxable		10,792		10,637		9,859			31,889		28,773
Total interest and dividend income		171,156		148,755		146,379			458,367		444,904
Interest expense:
Interest on deposits		15,386		6,097		5,837			25,966		22,203
Interest on short-term borrowings		1,229		555		22			1,805		91
Interest on long-term borrowings		3,826		3,336		3,032			10,183		9,676
Total interest expense		20,441		9,988		8,891			37,954		31,970
Net interest income		150,715		138,767		137,488			420,413		412,934
Provision for credit losses		6,412		3,559		(18,850	)		12,771		(59,888	)
Net interest income after provision for credit losses		144,303		135,208		156,338			407,642		472,822
Noninterest income:
Service charges on deposit accounts		6,784		8,040		7,198			22,421		19,314
Other service charges, commissions and fees		1,770		1,709		1,534			5,134		4,970
Interchange fees		2,461		2,268		2,203			6,539		6,252
Fiduciary and asset management fees		4,134		6,939		7,029			18,329		20,323
Mortgage banking income		1,390		2,200		4,818			6,707		17,692
Bank owned life insurance income		3,445		2,716		2,727			8,858		8,202
Loan-related interest rate swap fees		2,050		2,600		1,102			8,510		4,176
Other operating income		3,550		11,814		3,327			17,525		8,459
Total noninterest income		25,584		38,286		29,938			94,023		89,388
Noninterest expenses:
Salaries and benefits		56,600		55,305		53,534			170,203		156,959
Occupancy expenses		6,408		6,395		7,251			19,685		21,705
Furniture and equipment expenses		3,673		3,590		4,040			10,860		11,919
Technology and data processing		8,273		7,862		7,534			23,930		21,657
Professional services		3,504		4,680		3,792			12,274		13,161
Marketing and advertising expense		2,343		2,502		2,548			7,008		7,330
FDIC assessment premiums and other insurance		3,094		2,765		2,172			8,344		6,798
Franchise and other taxes		4,507		4,500		4,432			13,506		13,303
Loan-related expenses		1,575		1,867		1,503			5,218		5,289
Amortization of intangible assets		2,480		2,915		3,381			8,434		10,679
Loss on debt extinguishment		—		—		—			—		14,695
Other expenses		7,466		6,387		5,156			24,550		15,756
Total noninterest expenses		99,923		98,768		95,343			304,012		299,251
Income before income taxes		69,964		74,726		90,933			197,653		262,959
Income tax expense		11,894		12,500		16,368			33,667		46,821
Net income	$	58,070	$	62,226	$	74,565			163,986		216,138
Dividends on preferred stock		2,967		2,967		2,967			8,901		8,901
Net income available to common shareholders	$	55,103	$	59,259	$	71,598		$	155,085	$	207,237

Basic earnings per common share	$	0.74	$	0.79	$	0.94		$	2.07	$	2.66
Diluted earnings per common share	$	0.74	$	0.79	$	0.94		$	2.07	$	2.66

AVERAGE BALANCES, INCOME AND EXPENSES, YIELDS AND RATES (TAXABLE EQUIVALENT BASIS) (UNAUDITED)
(Dollars in thousands)


	For the Quarter Ended
	September 30, 2022							June 30, 2022
	Average Balance			Interest Income / Expense ⁽¹⁾		Yield / Rate ⁽¹⁾⁽²⁾		Average Balance			Interest Income / Expense ⁽¹⁾		Yield / Rate ⁽¹⁾⁽²⁾
Assets:
Securities:
Taxable	$	2,193,279		$	14,750	2.67	%	$	2,322,024		$	14,695	2.54	%
Tax-exempt		1,625,328			13,661	3.33	%		1,608,888			13,465	3.36	%
Total securities		3,818,607			28,411	2.95	%		3,930,912			28,160	2.87	%
Loans, net ⁽³⁾		13,733,447			145,433	4.20	%		13,525,529			123,764	3.67	%
Other earning assets		327,168			1,154	1.40	%		190,029			408	0.86	%
Total earning assets	$	17,879,222		$	174,998	3.88	%	$	17,646,470		$	152,332	3.46	%
Allowance for loan and lease losses		(104,746	)						(103,211	)
Total non-earning assets		2,206,024							2,176,143
Total assets	$	19,980,500						$	19,719,402

Liabilities and Stockholders' Equity:
Interest-bearing deposits:
Transaction and money market accounts	$	8,247,650		$	11,342	0.55	%	$	7,987,888		$	3,082	0.15	%
Regular savings		1,171,071			64	0.02	%		1,169,199			55	0.02	%
Time deposits		1,745,224			3,980	0.90	%		1,667,378			2,960	0.71	%
Total interest-bearing deposits		11,163,945			15,386	0.55	%		10,824,465			6,097	0.23	%
Other borrowings		703,272			5,055	2.85	%		765,886			3,891	2.04	%
Total interest-bearing liabilities	$	11,867,217		$	20,441	0.68	%	$	11,590,351		$	9,988	0.35	%

Noninterest-bearing liabilities:
Demand deposits		5,324,279							5,366,591
Other liabilities		352,005							317,415
Total liabilities	$	17,543,501						$	17,274,357
Stockholders' equity		2,436,999							2,445,045
Total liabilities and stockholders' equity	$	19,980,500						$	19,719,402
Net interest income				$	154,557						$	142,344

Interest rate spread						3.20	%						3.11	%
Cost of funds						0.45	%						0.22	%
Net interest margin						3.43	%						3.24	%

⁽¹⁾Income and yields are reported on a taxable equivalent basis using the statutory federal corporate tax rate of 21%.

⁽²⁾Rates and yields are annualized and calculated from actual, not rounded amounts in thousands, which appear above.
⁽³⁾Nonaccrual loans are included in average loans outstanding.

Contact:
Robert M. Gorman - (804) 523-7828
Executive Vice President / Chief Financial Officer

Atlantic Union Bankshares Reports Third Quarter Financial Results

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