Atlantic Union Bankshares Corp AUB

Atlantic Union Bankshares emphasized its disciplined execution and strategic investments over the past two years, which are now translating into stronger earnings capacity and capital generation. The company highlighted its robust presence in attractive markets, reinforcing its status as a premier regional bank in the Lower Mid-Atlantic. Management reiterated its commitment to soundness, profitability, and growth, in that order, with no additional acquisitions planned in this phase.

The bank achieved record loan production, exceeding Q4 2025 levels by 8%, with period-end loans growing 10.4% annualized to $28.7 billion. Growth was broad-based across commercial, construction, multifamily, and select consumer categories. Deposits saw low single-digit annualized growth, concentrated in interest-bearing accounts, while brokered deposits were significantly reduced by $53 million in Q2 and $571 million year-to-date. The loan-to-deposit ratio ended at 94.1%, within the preferred 90%-95% range.

Reported fully tax equivalent net interest margin expanded by 9 basis points to 3.94%, primarily due to higher accretion income and loan yields. Core net interest margin, excluding purchase accounting adjustments, increased by 1 basis point to 3.46%. However, the company noted increased funding costs driven by customer migration to higher-yielding deposit products, with deposit costs rising 3 bps in Q2 and 2 bps in June, which informed the updated NII and NIM guidance.

Credit quality remained strong, with annualized net charge-offs at a low 3 basis points for the quarter and year-to-date. Nonperforming assets increased modestly but stayed low at 39 basis points of loans held for investment, and criticized and classified assets improved to 4.4% of total loans, down from 4.5% in the prior quarter. The allowance for credit losses remained stable at 115 basis points, and the full-year net charge-off guidance was lowered to 5-10 basis points.

The company's regulatory capital ratios remained comfortably above well-capitalized levels, with a CET1 ratio of 10.41%, within the target range of 10% to 10.5%. Tangible book value per share grew 4.2% linked quarter and 13% year-over-year. Atlantic Union repurchased $10 million of common shares at an average price of $37.76, with $240 million remaining under authorization, demonstrating a commitment to capital return and long-term shareholder value creation.

The company detailed its 'densification strategy' in Raleigh and Wilmington, North Carolina, with the first of 10 new branches opening in Raleigh this month. Two more Raleigh branches are planned for October and November, with the remaining branches expected by 2027-2028. The commercial banking teams in North Carolina are also seeing double-digit loan balance growth and successful talent acquisition, working closely with the consumer segment.