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United reports 2nd quarter earnings jump after bringing Cardinal into fold

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United Bankshares weathered acquisition expenses to post improved second quarter and first half earnings compared to 2016, according to the bank’s most recent earnings report.

The bank, dual-headquartered in Charleston and Washington, D.C., announced earnings of $75.9 million for the first half of 2017, compared to earnings of $66.5 million for the first half of 2016. Net interest income for the 2017 second quarter was $136.2 million, a 33 percent jump from the 2016 second quarter.

It’s United’s first earnings report to include the consolidated results of Cardinal Financial Corporation, which the bank completed its acquisition of in April. The $912 million acquisition is the largest in company history and expands its footprint in Washington, D.C., according to a United news release.

Cardinal, a financial services holding company, has $4.3 billion in assets, according to the report, bumping up the value of United’s consolidated assets to $19 billion as of June 30.

However, United did see $24.5 million in expenses relating to the merger in the first half of 2017. It also saw a $28.6 million increase in noninterest expense from the 2016 second quarter to the 2017 second quarter. The additional employees and branch offices acquired as part of the Cardinal deal were the primary driver behind this, the report said.

“Despite significant merger expenses related to the acquisition of Cardinal, our core earnings remain strong,” said Richard M. Adams, the bank’s chairman of the board and chief executive officer, in a news release.

United more than doubled its noninterest income, increasing from $22.5 million in the second quarter of 2016 to $40.5 million in the second quarter of 2017. United attributed the drastic jump to increased production and sales of mortgage loans in the secondary market after acquiring mortgage banking subsidiary George Mason in the Cardinal deal.

United’s earnings per share for the second quarter dropped from 44 cents in 2016 to 37 cents in 2017. United also experienced this from the 2016 first quarter to 2017 first quarter, saying in a previous earnings report that it was due to the issuance of 4.3 million common shares in a $199.9 million public offering in December.

Reach Max Garland at max.garland@wvgazettemail.com, 304-348-4886 or follow @MaxGarlandTypes on Twitter.

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