UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(MARK ONE)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from          to         

Commission file number001-38481

UMB FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

Missouri	43-0903811
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

1010 Grand Boulevard, Kansas City, Missouri	64106
(Address of principal executive offices)	(Zip Code)

(Registrant's telephone number, including area code): (816) 860-7000

Securities Registered Pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $1.00 Par Value	UMBF	The NASDAQ Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non- accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ☐    No  ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

As of April 24, 2023, UMB Financial Corporation had 48,508,939 shares of common stock outstanding.

UMB FINANCIAL CORPORATION

FORM 10-Q

INDEX

PART I – FINANCIAL INFORMATION		3
ITEM 1.	FINANCIAL STATEMENTS (UNAUDITED)	3
CONSOLIDATED BALANCE SHEETS		3
CONSOLIDATED STATEMENTS OF INCOME		4
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME		5
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY		6
CONSOLIDATED STATEMENTS OF CASH FLOWS		7
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS		9
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	56
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	72
ITEM 4.	CONTROLS AND PROCEDURES	77
PART II - OTHER INFORMATION		78
ITEM 1.	LEGAL PROCEEDINGS	78
ITEM 1A.	RISK FACTORS	78
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	78
ITEM 6.	EXHIBITS	79
SIGNATURES		80

2

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

UMB FINANCIAL CORPORATION

CONSOLIDATED BALANCE SHEETS

(dollars in thousands, except share and per share data)

	March 31,			December 31,
	2023			2022
	(unaudited)			(audited)
ASSETS
Loans	$	21,812,972		$	21,031,189
Allowance for credit losses on loans		(210,509	)		(191,836	)
Net loans		21,602,463			20,839,353
Loans held for sale		1,422			1,978
Securities:
Available for sale (amortized cost of $7,585,599 and $7,777,950, respectively)		6,907,897			7,006,347
Held to maturity, net of allowance for credit losses of $2,341 and $2,407, respectively (fair value of $5,371,862 and $5,280,659, respectively)		5,859,323			5,859,192
Trading securities		19,823			17,980
Other securities		416,337			349,758
Total securities		13,203,380			13,233,277
Federal funds sold and securities purchased under agreements to resell		368,158			958,597
Interest-bearing due from banks		3,121,323			1,179,105
Cash and due from banks		472,248			500,682
Premises and equipment, net		260,623			263,649
Accrued income		181,586			189,231
Goodwill		207,385			207,385
Other intangibles, net		76,426			78,724
Other assets		1,112,176			1,060,480
Total assets	$	40,607,190		$	38,512,461
LIABILITIES
Deposits:
Noninterest-bearing demand	$	12,488,803		$	13,260,363
Interest-bearing demand and savings		16,760,603			18,461,632
Time deposits under $250,000		456,129			379,087
Time deposits of $250,000 or more		2,226,369			538,051
Total deposits		31,931,904			32,639,133
Federal funds purchased and repurchase agreements		2,160,808			2,222,167
Short-term debt		2,800,000			—
Long-term debt		381,796			381,311
Accrued expenses and taxes		207,633			239,624
Other liabilities		310,390			363,133
Total liabilities		37,792,531			35,845,368
SHAREHOLDERS' EQUITY
Common stock, $1.00 par value; 80,000,000 shares authorized; 55,056,730 shares issued, 48,507,116 and 48,319,404 shares outstanding, respectively		55,057			55,057
Capital surplus		1,120,877			1,125,949
Retained earnings		2,609,928			2,536,086
Accumulated other comprehensive loss, net		(626,776	)		(702,735	)
Treasury stock, 6,549,614 and 6,737,326 shares, at cost, respectively		(344,427	)		(347,264	)
Total shareholders' equity		2,814,659			2,667,093
Total liabilities and shareholders' equity	$	40,607,190		$	38,512,461

 See Notes to Consolidated Financial Statements.

3

UMB FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(unaudited, dollars in thousands, except share and per share data)

	Three Months Ended
	March 31,
	2023			2022
INTEREST INCOME
Loans	$	308,441		$	149,470
Securities:
Taxable interest		53,049			43,382
Tax-exempt interest		25,306			23,855
Total securities income		78,355			67,237
Federal funds and resell agreements		5,651			2,450
Interest-bearing due from banks		16,166			2,457
Trading securities		134			185
Total interest income		408,747			221,799
INTEREST EXPENSE
Deposits		127,899			6,173
Federal funds and repurchase agreements		23,302			2,148
Other		15,850			3,123
Total interest expense		167,051			11,444
Net interest income		241,696			210,355
Provision for credit losses		23,250			(6,500	)
Net interest income after provision for credit losses		218,446			216,855
NONINTEREST INCOME
Trust and securities processing		62,359			59,528
Trading and investment banking		5,308			5,440
Service charges on deposit accounts		21,159			24,642
Insurance fees and commissions		274			259
Brokerage fees		13,676			3,456
Bankcard fees		18,172			16,635
Investment securities losses, net		(5,324	)		(522	)
Other		14,576			14,240
Total noninterest income		130,200			123,678
NONINTEREST EXPENSE
Salaries and employee benefits		142,498			130,634
Occupancy, net		12,177			12,232
Equipment		17,849			18,164
Supplies and services		3,875			3,262
Marketing and business development		5,335			4,932
Processing fees		23,240			18,443
Legal and consulting		7,285			6,911
Bankcard		7,133			6,567
Amortization of other intangible assets		2,298			1,071
Regulatory fees		5,551			3,482
Other		9,811			9,080
Total noninterest expense		237,052			214,778
Income before income taxes		111,594			125,755
Income tax expense		19,157			19,792
NET INCOME	$	92,437		$	105,963
PER SHARE DATA
Net income – basic	$	1.91		$	2.19
Net income – diluted		1.90			2.17
Dividends		0.38			0.37
Weighted average shares outstanding – basic		48,435,016			48,406,840
Weighted average shares outstanding – diluted		48,746,562			48,832,177

See Notes to Consolidated Financial Statements.

4

UMB FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited, dollars in thousands)

	Three Months Ended
	March 31,
	2023			2022
Net income	$	92,437		$	105,963
Other comprehensive income (loss), before tax:
Unrealized gains and losses on debt securities:
Change in unrealized holding gains and losses, net		93,657			(622,910	)
Less:  Reclassification adjustment for net losses included in net income		433			—
Amortization of net unrealized loss on securities transferred from available-for-sale to held-to-maturity		9,983			582
Change in unrealized gains and losses on debt securities		104,073			(622,328	)
Unrealized gains and losses on derivative hedges:
Change in unrealized gains and losses on derivative hedges, net		(1,527	)		4,680
Less: Reclassification adjustment for net gains included in net income		(2,561	)		(851	)
Change in unrealized gains and losses on derivative hedges		(4,088	)		3,829
Other comprehensive income (loss), before tax		99,985			(618,499	)
Income tax (expense) benefit		(24,026	)		149,057
Other comprehensive income (loss)		75,959			(469,442	)
Comprehensive income (loss)	$	168,396		$	(363,479	)

See Notes to Consolidated Financial Statements.

5

UMB FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

(unaudited, dollars in thousands, except per share data)

	Common Stock		Capital Surplus		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total
Balance – January 1, 2022	$	55,057	$	1,110,520	$	2,176,998		$	126,314		$	(323,465	)	$	3,145,424
Total comprehensive income (loss)		—		—		105,963			(469,442	)		—			(363,479	)
Dividends ($0.37 per share)		—		—		(17,832	)		—			—			(17,832	)
Purchase of treasury stock		—		—		—			—			(