A Look Back at Regional Banks Stocks' Q2 Earnings: United Community Banks (NYSE:UCB) Vs The Rest Of The Pack

The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how United Community Banks (NYSE:UCB) and the rest of the regional banks stocks fared in Q2.

Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.

The 98 regional banks stocks we track reported a satisfactory Q2. As a group, revenues were in line with analysts’ consensus estimates.

While some regional banks stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 4.4% since the latest earnings results.

United Community Banks (NYSE:UCB)

Starting as a small community bank in 1950 and expanding through strategic acquisitions across the Southeast, United Community Banks (NYSE:UCB) is a regional bank holding company that provides financial services including loans, deposits, wealth management, and merchant services across the southeastern United States.

United Community Banks reported revenues of $260.2 million, up 6.1% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with a decent beat of analysts’ EPS estimates.

Chairman and CEO Lynn Harton stated, “This was a great quarter, with strong financial results and continued strategic accomplishments. Tangible book value per share grew by $0.42 and we successfully completed the acquisition of American National Bank on May 1. Excluding loans and deposits received from the American National Bank acquisition, loans grew by $194 million, or 4.2% annualized, while customer deposits, excluding the expected seasonal outflow of public funds, were up $64 million or 1.3% annualized. Second quarter loan growth was funded by cash flow from securities, creating a more favorable earning asset mix. Our net interest margin improved by 14 basis points, contributing to growth in our net interest income of $13.5 million when compared to the first quarter. Operating efficiency and operating leverage also both improved from the first quarter.”

Unsurprisingly, the stock is down 3.7% since reporting and currently trades at $30.13.

Is now the time to buy United Community Banks? Access our full analysis of the earnings results here, it’s free.

Best Q2: UMB Financial (NASDAQ:UMBF)

With roots dating back to 1913 and a name derived from "United Missouri Bank," UMB Financial (NASDAQ:UMBF) is a financial holding company that provides banking, asset management, and fund services to commercial, institutional, and individual customers.

UMB Financial reported revenues of $689.2 million, up 76.7% year on year, outperforming analysts’ expectations by 8.6%. The business had a stunning quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ tangible book value per share estimates.

The market seems content with the results as the stock is up 1.4% since reporting. It currently trades at $111.26.

Is now the time to buy UMB Financial? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Coastal Financial (NASDAQ:CCB)

Pioneering the intersection of traditional banking and financial technology in the Pacific Northwest, Coastal Financial (NASDAQ:CCB) operates as a bank holding company that provides traditional banking services and Banking-as-a-Service (BaaS) solutions to consumers and businesses.

Coastal Financial reported revenues of $119.4 million, down 11.7% year on year, falling short of analysts’ expectations by 21.5%. It was a disappointing quarter as it posted a significant miss of analysts’ net interest income estimates and a significant miss of analysts’ EPS estimates.

As expected, the stock is down 6.4% since the results and currently trades at $95.

Read our full analysis of Coastal Financial’s results here.

Webster Financial (NYSE:WBS)

Founded during the Great Depression in 1935 and evolving into a major Northeastern financial institution, Webster Financial (NYSE:WBS) is a bank holding company that provides commercial banking, consumer banking, and employee benefits solutions through its Webster Bank and HSA Bank division.

Webster Financial reported revenues of $715.8 million, up 16.5% year on year. This number met analysts’ expectations. It was a satisfactory quarter as it also recorded a narrow beat of analysts’ tangible book value per share estimates.

The stock is down 3.1% since reporting and currently trades at $56.66.

Read our full, actionable report on Webster Financial here, it’s free.

Banner Bank (NASDAQ:BANR)

Founded in 1890 in Walla Walla, Washington, and evolving through more than a century of economic cycles, Banner Corporation (NASDAQ:BANR) operates Banner Bank, providing commercial banking services, loans, and financial products to individuals and businesses across Washington, Oregon, California, Idaho, and Utah.

Banner Bank reported revenues of $162.2 million, up 8.3% year on year. This print came in 1% below analysts' expectations. It was a slower quarter as it also logged a slight miss of analysts’ net interest income estimates and EPS in line with analysts’ estimates.

The stock is down 5.3% since reporting and currently trades at $63.17.

Read our full, actionable report on Banner Bank here, it’s free.

Market Update

Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.

Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Growth Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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