United Bankshares, Inc. (NASDAQ: UBSI), today reported an increase in earnings for the second quarter and the first half of 2012 as compared to the same time periods in 2011. Earnings for the second quarter of 2012 were $21.0 million or $0.42 per diluted share, up $3.6 million or 21% from earnings of $17.5 million or $0.40 per diluted share for the second quarter of 2011. Earnings for the first half of 2012 were $42.1 million or $0.84 per diluted share, an increase of $6.7 million or 19% from earnings of $35.3 million or $0.81 per diluted share for the first half of 2011.
Second quarter of 2012 results produced a return on average assets of 1.00% and a return on average equity of 8.58%, respectively. For the first half of 2012, United’s return on average assets was 1.00% while the return on average equity was 8.60%. These returns compare favorably to United’s most recently reported Federal Reserve peer group’s (bank holding companies with total assets between $3 and $10 billion) average return on assets of 0.93% and average return on equity of 8.54% for the first quarter of 2012. United’s annualized returns on average assets and average equity were 0.98% and 8.66%, respectively, for the second quarter of 2011 while the returns on average assets and average equity was 1.00% and 8.85%, respectively, for the first half of 2011.
The results for the second quarter and first half of 2012 included noncash, before-tax, other-than-temporary impairment charges of $1.7 million and $3.1 million, respectively, on certain investment securities. The results for the second quarter and first half of 2011 included noncash, before-tax, other-than-temporary impairment charges of $4.1 million and $6.2 million, respectively, on certain investment securities.
United’s asset quality also continues to outperform its peers. United’s percentage of nonperforming loans to loans, net of unearned income of 1.23% at June 30, 2012 compares favorably to the most recently reported percentage of 3.33% at March 31, 2012 for United’s Federal Reserve peer group. At June 30, 2012, nonperforming loans were $77.6 million, down from nonperforming loans of $79.7 million or 1.28% of loans, net of unearned income, at December 31, 2011. As of June 30, 2012, the allowance for loan losses was $73.4 million or 1.16% of loans, net of unearned income, which was comparable to $73.9 million or 1.18% of loans, net of unearned income, at December 31, 2011. United’s coverage ratio of its allowance for loan losses to nonperforming loans also compares favorably to its peers. The coverage ratio for United was 94.64% and 92.73% at June 30, 2012 and December 31, 2011, respectively. The coverage ratio for United’s Federal Reserve peer group was 85.99% at March 31, 2012. Total nonperforming assets of $126.2 million, including OREO of $48.6 million at June 30, 2012, represented 1.49% of total assets which also compares favorably to the most recently reported percentage of 2.62% at March 31, 2012 for United’s Federal Reserve peer group.
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