<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1995
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 number 0-4887
UMB FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
Missouri 43-0903811
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization Identification No.)
1010 Grand Avenue, Kansas City, Missouri 64106
(Address of principal executive offices and Zip Code)
(816) 860-7000
(Registrant's telephone number, including area code)
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 X No
At June 30, 1995, UMB Financial Corporation had 18,819,453 shares of common
stock outstanding. This is the only class of stock of the Company.
<PAGE>
UMB FINANCIAL CORPORATION
FORM 10-Q
INDEX
PART I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets
as of June 30, 1995 and 1994 and December 31, 1994 3
Consolidated Statements of Income for the Three and Six Months
Ended June 30, 1995 and 1994 4
Consolidated Statements of Cash Flows for the Six Months
Ended June 30, 1995 and 1994 5
Consolidated Statements of Shareholders' Equity
Ended June 30, 1995 and 1994 6
Notes to Consolidated Financial Statements 7-8
Supplemental Financial Data
Average Balances/ Yields and Rates 9
Analysis of Changes in Net Interest Income and Margin 10
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 11-13
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K 14
Signatures 15
<PAGE>
UMB FINANCIAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands)
<TABLE>
<CAPTION>
June 30, December 31,
ASSETS 1995 1994 1994
Loans:
<S> <C> <C> <C>
Commercial, financial and agricultural $1,191,302 $1,116,181 $1,135,827
Consumer (net of unearned interest) 710,738 619,375 687,068
Real estate 446,460 456,012 444,565
Leases 1,428 1,411 2,157
Allowance for loan losses (31,758) (32,977) (32,527)
_________ _________ _________
Net Loans 2,318,170 2,160,002 2,237,090
Securities available for sale:
U.S. Treasury and agencies 1,833,461 2,467,105 2,267,188
Equity securities and other 6,256 10,753 8,025
_________ _________ _________
Total securities available for sale 1,839,717 2,477,858 2,275,213
Securities held to maturity:
State and political subdivisions 317,452 285,239 298,556
U.S. Agencies 86,234 86,448 86,278
_________ _________ _________
Total securities held to maturity (market value
of $401,823, $368,097 & $373,644, respectively) 403,686 371,687 384,834
Federal funds and resell agreements 153,638 304,860 534,099
Trading securities and other earning assets 42,768 42,868 30,982
_________ _________ _________
Total earning assets 4,757,979 5,357,275 5,462,218
Cash and due from banks 572,411 535,768 770,813
Bank premises and equipment, net 137,629 129,659 130,261
Accrued income 74,328 73,525 81,219
Premium on and intangibles of purchased banks 74,541 81,751 78,091
Other Assets 51,401 62,552 76,418
_________ _________ _________
Total assets $5,668,289 $6,240,530 $6,599,020
========= ========= =========
LIABILITIES
Deposits:
Noninterest-bearing demand $1,342,765 $1,474,066 $1,570,478
Interest-bearing demand and savings 1,890,974 2,381,824 2,421,149
Time deposits under $100,000 946,161 992,334 949,728
Time deposits of $100,000 or more 178,390 189,565 191,479
_________ _________ _________
Total deposits 4,358,290 5,037,789 5,132,834
Federal funds and repurchase agreements 605,157 515,727 801,003
Short-term debt 2,104 3,222 872
Long-term debt 46,172 51,453 46,330
Accrued expenses and taxes 40,241 33,230 38,638
Other liabilities 14,932 30,960 22,037
_________ _________ _________
Total liabilities $5,066,896 $5,672,381 $6,041,714
SHAREHOLDERS' EQUITY
Common stock, $1.00 par value; authorized
23,000,000 shares; 20,677,558 shares issued $20,678 $20,678 $20,678
Capital surplus 442,579 442,753 442,606
Retained Earnings 199,539 166,419 182,159
Net unrealized loss on securities available for sale (2,661) (17,606) (35,211)
Treasury stock, 1,858,105, 1,406,178 and
1,676,451 shares, at cost, respectively (58,742) (44,095) (52,926)
________ _________ _________
Total shareholders' equity 601,393 568,149 557,306
_________ _________ _________
Total liabilities and shareholders' equity $5,668,289 $6,240,530 $6,599,020
========= ========= =========
<FN>
See Notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
UMB FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(unaudited in thousands)
<TABLE>
<CAPTION>
Three Months Six Months
Ended June 30, Ended June 30,
INTEREST INCOME 1995 1994 1995 1994
<S> <C> <C> <C> <C>
Loans $54,946 $41,716 $105,344 $80,392
Securities:
Taxable interest 27,086 31,405 56,121 61,860
Tax-exempt interest 3,604 3,067 7,092 6,005
______ ______ ______ ______
Total securities income $30,690 $34,472 $ 63,213 $67,865
Federal funds and resell agreements 2,329 3,077 7,010 6,248
Trading securities and other 897 824 1,869 1,703
______ ______ _______ _______
Total interest income 88,862 80,089 177,436 156,208
INTEREST EXPENSE
Deposits 30,958 26,015 62,610 51,537
Federal funds and repurchase
agreements 7,334 5,994 15,179 10,332
Short-term debt 9 7 21 15
Long-term debt 907 1,020 1,824 2,038
______ ______ ______ ______
Total interest expense 39,208 33,036 79,634 63,922
Net interest income 49,654 47,053 97,802 92,286
Provision for loan losses 925 516 1,851 898
______ ______ ______ ______
Net interest income after provision 48,729 46,537 95,951 91,388
NONINTEREST INCOME
Trust income 8,967 9,079 17,378 17,539
Securities processing 2,980 2,667 5,590 5,789
Trading and investment banking 2,767 2,413 5,518 5,403
Service charges on deposits 7,729 8,185 15,983 16,379
Other service charges and fees 4,234 4,253 7,656 7,915
Bankcard fees 7,571 6,940 13,696 12,254
Net investment security gains 866 288 1,283 3,315
Other 1,365 1,698 5,362 3,051
______ ______ ______ ______
Total noninterest income 36,479 35,523 72,466 71,645
NONINTEREST EXPENSE
Salaries and employee benefits 30,981 30,029 62,022 59,858
Occupancy, net 3,824 3,723 7,627 7,525
Equipment 5,259 4,990 10,448 10,089
Supplies and services 4,670 4,998 9,267 9,636
Bankcard processing 7,808 5,965 13,136 10,500
Marketing and business development 4,634 4,021 8,223 7,583
FDIC and regulatory fees 3,127 3,051 6,154 6,046
Other 7,071 8,068 14,512 15,497
______ ______ _______ _______
Total noninterest expense 67,374 64,845 131,389 126,734
Income before income taxes $17,834 $17,215 $ 37,028 $ 36,299
Income tax provision 5,739 6,107 12,078 11,844
______ ______ ______ ______
NET INCOME $12,095 $11,108 $24,950 $24,455
====== ====== ====== ======
PER SHARE DATA
Net income $0.64 $0.58 $1.32 1.27
Dividends $0.20 $0.18 $0.40 0.36
Weighted average shares outstanding 18,930,222 19,281,838 18,960,655 19,303,050
<FN>
See Notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
UMB FINANCIAL CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited in thousands)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
1995 1994
Operating Activities
<S> <C> <C>
Net Income $24,950 $24,455
Adjustments to reconcile net income to
net cash provided by operating activities:
Provision for loan losses 1,851 898
Depreciation and amortizaton 11,329 10,889
Deferred income taxes and investment tax credits (2,518) (646)
Net (increase) decrease in trading securities (11,786) 40,878
Investment security gains (2,794) (3,360)
Investment security losses 1,511 45
Amortization of securities premium,
net of discount accretion 18,028 21,606
Increase (decrease) in interest receivable 6,891 (974)
Decrease in interest payable (438) (1,935)
Other, net 2,349 (29,242)
------ ------
Net cash provided by operating activities $49,373 $62,614
Investing Activities
Proceeds from maturities of investment securities $50,572 $65,967
Proceeds from sales of securities available for sale 231,136 120,988
Proceeds from maturities of securities available for sale 677,943 457,656
Purchases of investment securities (70,642) (73,376)
Purchases of securities available for sale (436,438) (511,393)
Net decrease in loans (82,931) (36,729)
Net decrease in federal funds and resell agreements 380,461 34,315
Purchases of bank premises and equipment (15,211) (8,065)
Proceeds from sales of bank premises and equipment 64 35
------- ------
Net cash provided by investing activities $734,954 $49,398
Financing Activities
Net increase (decrease) in demand and savings deposits ($757,888) $3,271
Net decrease in time deposits (16,656) (127,211)
Net decrease in federal funds and repurchase agreements (195,846) (109,355)
Net increase in short term borrowings 1,232 1,769
Repayment of long term debt (158) (76)
Cash dividends (7,570) (7,050)
Proceeds from exercise of stock options 64 122
Purchases of treasury stock (5,907) (4,082)
_______ _______
Net cash used by financing activities ($982,729) ($242,612)
Decrease in cash and due from banks (198,402) (130,600)
Cash and due from banks at beginning of year 770,813 666,368
_______ _______
Cash and due from banks at end of period $572,411 $535,768
======= =======
<FN>
See Notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
UMB FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(in thousands)
<TABLE>
<CAPTION>
Net
Unrealized
Common Capital Retained Holding Treasury
Stock Surplus Earnings Gain (Loss) Stock
<S> <C> <C> <C> <C> <C>
Balance - December 31, 1993 $236,579 $167,368 $208,557 $14,333 ($40,194)
Net income 0 0 24,455 0 0
Cash Dividends 0 0 (7,050) 0 0
10% stock dividend 1,751 57,792 (59,543) 0 0
Adjust par value (217,652) 217,652 0 0 0
Purchase of treasury stock 0 0 0 0 (4,082)
Exercise of stock options 0 (59) 0 0 181
Net unrealized loss on securities available for sale 0 0 0 (31,939) 0
______ _______ _______ ______ ______
Balance - June 30, 1994 $20,678 $442,753 $166,419 ($17,606) ($44,095)
====== ======= ======= ======
Balance - December 31, 1994 $20,678 $442,606 $182,159 ($35,211) ($52,926)
Net income 0 0 24,950 0 0
Cash dividends 0 0 (7,570) 0 0
Purchase of treasury stock 0 0 0 0 (5,907)
Exercise of stock options 0 (27) 0 0 91
Net unrealized gain on securities available for sale 0 0 0 32,550 0
______ _______ _______ _____ ______
Balance - June 30, 1995 $20,678 $442,579 $199,539 ($2,661) ($58,742)
====== ======= ======= ===== ======
<FN>
See Notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
UMB FINANCIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SIX MONTHS ENDED JUNE 30, 1995
1. Change of Company Name and Par Value of Common Stock:
On April 21, 1994 the Company's shareholders approved changing the Company's
name from United Missouri Bancshares, Inc. to UMB Financial Corporation. The
name change was made in order to have a corporate identity which was not
geographically restrictive and which was consistent with the broad range of
financial services and products provided by the Company. On this same date the
shareholders approved an amendment to the Company's Articles of Incorporation to
reduce the par value of the Company's common stock per share to $1.00 per share.
2. Financial Statement Presentation:
The consolidated financial statements include the accounts of the Company and
its subsidiaries after elimination of all material intercompany transactions.
In the opinion of management of the Company, all adjustments, which were of a
normal recurring nature, necessary for a fair presentation of the financial
position and results of operations have been made. The financial statements
should be read in conjunction with the Management's Discussion and Analysis of
Financial Condition and results of Operations and with reference to the 1994
Annual Report to Shareholders.
3. Earnings Per Share:
Earnings per share are based on the weighted average number of shares of common
stock outstanding during the interim periods. All share and per share data has
been adjusted to reflect a 10% stock dividend paid on July 1, 1994.
4. Allowance for Loan Losses:
The following is a summary of the Allowance for Loan Losses for the six months
ended June 30, 1995 and 1994 (in thousands):
1995 1994
Balance January 1 $32,527 $35,590
Additions:
Provision for loan losses 1,851 898
------ ------
34,378 36,488
Deductions:
Charge-offs (3,632) (4,828)
Less recoveries on loans
previously charged-off 1,012 1,317
------ ------
Net charge-offs (2,620) (3,511)
------ ------
Balance, June 30 $31,758 $32,977
====== ======
At June 30, 1995 the amount of loans that are considered to be impaired under
SFAS No. 114 was $996,000. All of these loans are currently on a nonaccrual
basis. Included in the impaired loans is $613,000 of loans for which the
related allowance for loan losses is $240,000. The remaining $383,000 of
impaired loans do not have an allowance for loan loss as a result of write-downs
and supporting collateral value. The average recorded investment in impaired
loans during the period ended June 31, 1995 was approximately $988,000. The
Company has recorded no interest income on its impaired loans for the six months
ended June 30, 1995
<PAGE>
UMB FINANCIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SIX MONTHS ENDED JUNE 30, 1995
5. Commitments and Contingencies:
In the normal course of business, the Company and its subsidiaries are named
defendants in various lawsuits and counterclaims. In the opinion of management
after consultation with legal counsel, none of the suits will have a materially
adverse effect on the financial position or results of operations of the
Company.
6. Subsequent Events:
On August 2, 1995 the Company entered into an agreement to purchase 100% of the
outstanding shares of First Sooner Bancshares, Inc., a one bank holding company
headquartered in Oklahoma City, Oklahoma. First Sooner Bancshares is the sole
owner of the Oklahoma Bank, a $129 million-asset bank with three locations in
Oklahoma City. The acquisition, which is structured as a cash transaction,
is expected to close by the first quarter of 1996.
The Comapny also announced that it will adopt a dividend reinvestment plan for
shareholders. The Company anticipates implementing the dividend reinvestment
plan later this year after obatining the necessary regulatory approvals. The
dividend reinvestment plan will be offered by means of an effective prospectus.
<PAGE>
UMB FINANCIAL CORPORATION
AVERAGE BALANCES/YIELDS AND RATES
(tax-equivalent basis) (in thousands)
<TABLE>
<CAPTION>
Six Months Ended June 30,
1995 1994
Average Average Average Average
Assets Balance Yield/Rate Balance Yield/Rate
<S> <C> <C> <C> <C>
Loans, net of unearned interest $2,339,472 9.13% $2,111,143 7.74%
Securities:
Taxable 2,161,735 5.24% 2,681,683 4.65%
Tax-exempt 307,109 6.81% 280,513 6.29%
--------- ----
Total securities 2,468,844 5.43% 2,962,196 4.81%
Federal funds and resell agreements 239,706 5.90% 359,693 3.5%
Other earning assets 61,903 6.40% 67,612 5.22%
--------- ---- --------- ----
Total earning assets 5,109,925 7.16% 5,500,644 5.85%
Allowance for loan losses (32,259) (35,441)
Other assets 992,608 1,055,132
--------- ---------
Total assets $6,070,274 $6,520,335
========= =========
Liabilities and Shareholders' Equity
Interest-bearing deposits $3,410,253 3.70% $3,651,586 2.85%
Federal funds and repurchase agreements 574,377 5.33% 652,722 3.19%
Borrowed funds 47,384 7.85% 53,077 7.80%
--------- ---- --------- ----
Total interest-bearing liabilities 4,032,014 3.98% 4,357,385 2.95%
Noninterest-bearing demand deposits 1,389,933 1,516,935
Other liabilities 63,635 66,674
Shareholders' equity 584,692 579,341
--------- ---------
Total liabilities and shareholders' equity $6,070,274 $6,520,335
========= =========
Net Interest spread 3.18% 2.90%
Net interest margin 4.02% 3.51%
</TABLE>
<PAGE>
UMB FINANCIAL CORPORATION
ANALYSIS OF CHANGES IN NET INTEREST INCOME AND MARGIN
(tax-equivalent basis) (in thousands)
<TABLE>
<CAPTION>
ANALYSIS OF CHANGES IN NET INTEREST INCOME
Three Months Ended Six Months Ended
June 30, 1995 vs. 1994 June 30, 1995 vs. 1994
Volume Rate Total Volume Rate Total
Change in interest earned on:
<S> <C> <C> <C> <C> <C> <C>
Loans $5,668 $7,601 $13,269 $9,358 $15,566 $24,924
Securities:
Taxable (7,650) 3,329 (4,321) (12,907) 7,167 (5,740)
Tax-exempt 338 607 945 867 745 1,612
Federal funds sold (1,997) 1,251 (746) (2,551) 3,313 762
Other (32) 136 104 (157) 372 215
----- ------ ----- ----- ----- ------
Interest income ($3,673) $12,924 $9,251 ($5,390) $27,163 $21,773
Change in interest paid on:
Interest-bearing deposits (2,430) 7,372 4,942 (3,591) 14,663 11,072
Federal funds purchased ($1,523) $2,863 $1,340 ($1,366) $6,213 $4,847
Borrowed funds (115) 4 (111) (222) 14 (208)
------ ------ ----- ----- ------ ------
Interest expense (4,068) 10,239 6,171 (5,179) 20,890 15,711
----- ------ ----- ----- ------ ------
Net interest income $395 $2,685 $3,080 ($211) $6,273 $ 6,062
===== ===== ===== ====== ===== ======
ANALYSIS OF NET INTEREST MARGIN
Three Months Ended Six Months Ended
June 30, 1995 June 30, 1995
1995 1994 Change 1995 1994 Change
Average earning assets $4,959,382 $5,439,161 ($479,779) $5,109,925 $5,500,644 ($390,719)
Interest-bearing liabilities 3,883,837 4,357,804 (473,967) 4,032,014 4,357,385 (325,371)
--------- --------- ------- --------- --------- --------
Interest free funds $1,078,545 $1,081,357 $ (5,812) $1,077,911 $1,143,259 $(65,348)
Free funds ratio 21.69% 19.88% 1.81% 21.09% 20.78% .31%
(free funds to earning assets)
Tax-equivalent yield on earning assets 7.37% 6.04% 1.33% 7.16% 5.85% 1.31%
Cost of interest-bearing liabilities 4.05% 3.04% 1.01% 3.98% 2.95% 1.03%
Net interest spread 3.32% 3.00% .32% 3.18% 2.90% .28%
Benefit of interest free funds .88% .60% .28% .84% .61% .23%
Net interest margin 4.20% 3.60% .60% 4.02% 3.51% .51%
</TABLE>
<PAGE>
UMB FINANCIAL CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS FOR THE
SIX MONTHS ENDED JUNE 30, 1995
SUMMARY
UMB Financial Corporation, (the Company) earned net income of $12,095,000 for
the three months ended June 30, 1995, compared to $11,108,000 for the same
period a year earlier. This represents per share earnings of $0.64 for the
second quarter of 1995 compared to $0.58 for the second quarter of 1994.
On a year to date basis, 1995 earnings were $24,950,000 or $1.32 per share
compared to $24,455,000 or $1.27 per share for the prior year.
The Company's net interest income increased on a quarterly and year to date
basis as a result of an increase in lending activity and the effect of higher
interest rates. Non interest income increased only marginally for the second
quarter and for the year while non interest expense increased by approximately
4% during both periods.
RESULTS OF OPERATIONS
Net interest income totaled $49,654,000 for the second quarter of 1995, a 5.5%
increase over 1994 second quarter net interest income of $47,053,000. This
change is consistent with the year to date increase in net interest income
which totaled $97,802,000 for the first half of 1995 compared to $92,286,000
for the same period in 1994. The improvement in the Company's net interest
incomewas fueled by an increase in loans and higher interest rates. During the
second quarter of 1995 loans represented 48% of the Company's interest earning
assets compared to 39% during the second quarter of 1994. This change in asset
mix is a continuation of a trend resulting from an increased emphasis on lending
activity. During the twelve months ended June 30, 1995, the Company's consumer
and commercial loans increased 15% and 7%, respectively. The Company
also benefited from the overall increase in interest rates in 1995 as compared
to 1994. The effect of this benefit can be seen in the effect of interest free
funds on the Company's net interest margin. The benefit the Company receives
on interest free deposits represented 21% of net interest margin for both the
three and six month periods ended June 30, 1995, compared to approximately 17%
for the comparable periods in 1994. The Company's net interest income was also
effected by a reduction in earning assets which averaged $5.0 billion during the
second quarter of 1995 compared to $5.4 billion during the same period in 1994.
This decrease was the result of a deposit reduction, primarily during 1994,
caused by a very competitive rate environment and the loss of certain deposits
associated with a security processing customer in May of 1995.
The Company's loan loss provision for the second quarter of 1995 was $925,000
compared to $516,000 for the same period of 1994. The 1995 year to date loan
loss provision for the Company was $1,851,000 compared to $898,000 for 1994.
The Company's net losses for the first six months of 1995 were $2,620,000
compared to $3,511,000 for the first half of 1994. Approximately 75% of the net
losses for 1995 were attributable to bankcard loans.
<PAGE>
UMB FINANCIAL CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS FOR THE
SIX MONTHS ENDED JUNE 30, 1995
Non interest income totaled $36,479,000 for the three months ended
June 30, 1995, compared to $35,523,000 for the same period in 1994. Trust
income decreased marginally on a quarterly and year to date basis. The pricing
of trust services, especially in the employee benefits area, continues to be
very competitive. Income related to trading and investment banking activities
increased for the quarter and on a year to date basis. Transaction volumes for
1995 have increased compared to last year when volumes declined significantly.
Bankcard fees have increased significantly due to a larger volume of merchant
transactions. The Company's second quarter security gains resulted from the
sale of various assets held by the parent company and a non bank subsidiary.
Non interest expense totaled $67,374,000 for the second quarter of 1995
compared to $64,845,000 for the second quarter of 1994. Staffing related costs
increased approximately 3% in second quarter 1995 compared to 1994. Staffing
levels decreased during the first six months of the year which should result in
decreased expenses as this trend continues. Expenses related to
bankcard processing increased as a result of an increase in processed
transactions and costs associated with converting to a new third party
processing system. Marketing and business development expense also increased
during the second quarter, primarily as a result of increased promotion of
lending products and non deposit retail products. The decrease in other
expenses was caused by a number of factors associated with the Company's
increased emphasis on cost containment. Specific decreases occurred in outside
service fees, franchise taxes and costs related to other real estate. Changes
for the second quarter are consistent with results on a year to date basis.
FINANCIAL CONDITION
Total assets at June 30, 1995, were $5.668 billion compared to $6.241 billion
at June 30, 1994, and $6.599 billion at December 31, 1994. The decrease in
assets during the twelve months ended June 30, 1995, was the result of a
reduction in securities available for sale. The proceeds of this reduction
were used to fund a similar reduction in Company deposits. The decline in
deposits has been primarily the result of two factors. A reduction of
retail transaction accounts due to interest rate competition. This decrease
primarily occurred during the second half of 1994 and to a lesser extent
during the first quarter of 1995. In addition, there was a decline in deposits
of approximately $300 million related to a security processing customer.
Total deposits at June 30, 1995, declined $375 million from the previous
quarter. This decline was primarily the result of the previously noted deposits
related to security processing.
Net loans at June 30, 1995, were $2.318 billion compared to $2.160 billion a
year earlier and $2.237 billion at year end 1994. The Company has experienced
significant growth in its consumer loan portfolio as these loans have increased
by 15% during the twelve months ended June 30, 1995. During the six months
ended June 30, 1995, loans increased by approximately 4%. Managements
objective is to exceed this growth rate during the second half of the year.
The Company's non accrual and restructured loans totaled $4.5 million at
June 30, 1995, a 47% decrease from the previous year. Loans over ninety
days past due amounted to $5.3 million compared to $3.9 million a year earlier.
Other real estate owned decreased to $4.5 million from a total of $6.4 million
at June 30, 1994. Management does not expect any significant increases in the
above classification of assets.
<PAGE>
UMB FINANCIAL CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS FOR THE
SIX MONTHS ENDED JUNE 30, 1995
LIQUIDITY AND CAPITAL RESOURCES
The Company has a high level of liquidity as evidenced by the funding of the
recent reduction of deposits. The average maturity of the investment portfolio
(both held to maturity and available for sale) at June 30, 1995, was 18 months.
The Company's loan to deposit ratio has increased to 53.9% from 43.5% at
June 30, 1994. This increase was the result of both an increase in loans
and a reduction of deposits. The Company has access to various borrowing
markets should there be a need for additional funding.
Shareholders' equity totaled $601 million at June 30, 1995, compared to
$568 million at June 30, 1994 and $557 million at year end 1994. During the
twelve months ended June 30, 1995, the Company increased its treasury stock
holdings by $14.6 million. Management will continue to consider treasury
stock purchases depending on price, availability and alternative uses of funds.
At June 30, 1995, the net unrealized loss on securities available for sale was
$2.6 million, compared to a loss of $35.2 million at December 31, 1994.
The Company's capital position is summarized in the table below and far
exceeds regulatory requirements.
Six Months Ended
June 30,
1995 1994
RATIOS
Return on average assets 0.83 0.76
Return on average equity 8.61 8.51
Average equity to assets 9.63 8.89
Tier 1 risk-based capital ratio 17.08 17.56
Total risk-based capital ratio 18.13 18.87
Leverage ratio 9.47 8.18
PER SHARE DATA
Earnings 1.32 1.27
Cash dividends 0.40 0.36
Dividend payout ratio 30.30 28.35
Book value 31.96 29.48
<PAGE>
UMB FINANCIAL CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS FOR THE
SIX MONTHS ENDED JUNE 30, 1995
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K
a) The following exhibit is filed herewith:
27-Article 9 of Regulation S-X Financial Data Schedule for
June 30, 1995 Form 10-Q.
b) Reports on Form 8-K:
The Company filed no reports on Form 8-K during the quarter ended
June 30, 1995.
<PAGE>
UMB FINANCIAL CORPORATION
FORM 10-Q
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
UMB FINANCIAL CORPORATION
/s/ R. Crosby Kemper
R. Crosby Kemper
Chairman
/s/ Timothy M. Connealy
Timothy M. Connealy
Chief Financial Officer
Date: August 14, 1995
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