Shares little changed after quarterly results
United Community Banks, Inc. (NYSE:UCB) reported second-quarter results on Tuesday that fell short of Wall Street expectations, with earnings and revenue both narrowly missing analyst forecasts despite continued loan growth and expanding margins.
Shares were little changed in after-hours trading following the announcement.
Adjusted earnings came in at $0.71 per share, below the consensus estimate of $0.81. Revenue totaled $279.3 million, slightly under analyst expectations of $280.25 million.
Compared with the second quarter of 2025, adjusted earnings per share increased 8% from $0.66, while revenue rose 7% from $260.2 million.
GAAP earnings boosted by provision release
On a GAAP basis, earnings per share increased 51% year over year to $0.95.
The improvement was primarily driven by a $38.5 million pre-tax provision release following the reclassification of Navitas equipment finance loans as held for sale.
Net interest margin expanded to 3.68%, rising 18 basis points from a year earlier and three basis points from the previous quarter, marking the sixth consecutive quarter of margin improvement.
“Our second quarter results reflect strong loan growth and a strategic emphasis on our core banking business,” said Chairman and CEO Lynn Harton.
“Our loan portfolio grew $332 million in the second quarter, an annualized rate of 6.8%, reflecting the demographic strength of our geographic footprint and the diligence of our bankers.”
Loan growth offsets seasonal deposit decline
Total loans increased by $332 million during the quarter, representing annualised growth of 6.8% from the first quarter.
Excluding the pending sale of the Navitas business, loan production exceeded $1 billion, with annualised growth of 6.4%.
Customer deposits declined by $295 million from the previous quarter, largely reflecting seasonal outflows of public funds.
Capital position remains strong
Net charge-offs totaled $7.9 million, or 0.16% of average loans on an annualised basis, including $3.7 million related to the Navitas portfolio.
The allowance for credit losses represented 1.04% of total loans.
Noninterest expenses included a $4.5 million charge tied to a settlement with California regulators related to obtaining a lender’s licence for Navitas.
United Community Banks ended the quarter with a preliminary Common Equity Tier 1 ratio of 13.5% and declared a quarterly dividend of $0.25 per share, a 4% increase from the prior year.
United Community Banks stock price
