Atlantic Union earnings for the third quarter of 2026 reflected growing loan balances alongside pressure from funding costs. The bank reported net income available to common shareholders of $133.7 million, or $0.94 per diluted share, on October 20. Net interest income increased from the preceding quarter even as its net interest margin narrowed.
Key Takeaways
- Net interest income rose $3.3 million to $328.4 million, while net interest margin fell seven basis points to 3.82%.
- Lower fee income and a $2.7 million debt-redemption charge weighed on quarterly performance.
- Credit measures were mixed, with fewer nonperforming assets but more past-due loans still accruing interest.
Table of Contents
- Atlantic Union earnings reflect higher funding costs
- Fees and expenses complicate the quarterly comparison
- Credit performance shows improvement and pockets of strain
- Debt refinancing accompanies share repurchases
- Conclusion
Atlantic Union earnings reflect higher funding costs
The company’s third-quarter results announcement showed adjusted operating earnings available to common shareholders of $135.6 million, or $0.96 per diluted share. These company-defined non-GAAP measures exclude the effect of the subordinated-debt redemption expense.
Net interest income increased from $325.1 million in the second quarter to $328.4 million. Atlantic Union attributed the improvement primarily to loan growth and higher loan accretion income, partially offset by increased deposit and borrowing costs.
Loans held for investment reached $29.297 billion at September 30, up $624 million from June 30. But the cost of funds rose seven basis points to 2.01%, helping push net interest margin down from 3.89% to 3.82%. The figures show how a larger loan portfolio can generate more interest income even when the spread earned on assets narrows.
| Item | Details |
|---|---|
| Total assets | $38.352 billion at September 30, 2026, versus $38.100 billion at June 30. |
| Total deposits | $30.966 billion, up $498 million from June 30. |
| Allowance for credit losses | $334.2 million, up $3.3 million from the preceding quarter. |
| Common equity Tier 1 capital ratio | Estimated at 10.39%, compared with 10.41% at June 30; the September figure remained subject to change. |
Fees and expenses complicate the quarterly comparison
Noninterest income fell to $54.8 million from $90.2 million in the second quarter. Most of that decline reflected the absence of a $32.3 million pre-tax gain on the sale of Atlantic Union’s equity interest in Bearing Insurance Group, recognized in the preceding quarter.
Excluding that gain and small securities-sale gains, adjusted operating noninterest income declined $3.1 million. Lower loan-related interest-rate swap fees, mortgage banking income, and fiduciary and asset management fees contributed to the decrease.
Noninterest expense increased $5.2 million to $204.3 million, including the $2.7 million pre-tax loss on debt extinguishment. Adjusted operating noninterest expense also rose, with higher marketing, staffing and technology costs partly offset by lower other expenses.
Credit performance shows improvement and pockets of strain
Nonperforming assets declined to 0.37% of loans held for investment from 0.39% at June 30. Annualized net charge-offs remained unchanged sequentially at 0.03% of average loans.
However, past-due loans still accruing interest increased to $98.9 million, or 0.34% of loans, from $80.4 million, or 0.28%. The increase was concentrated in commercial real estate and commercial and industrial portfolios.
The provision for credit losses fell to $5.7 million from $11.7 million. Atlantic Union attributed the sequential reduction primarily to lower reserve requirements associated with a modest decline in coverage and slower loan growth.
Debt refinancing accompanies share repurchases
During the quarter, Atlantic Union issued $250 million of subordinated notes due August 1, 2036, initially carrying a 6.25% interest rate. It used part of the proceeds to redeem $168 million of outstanding notes due in 2029, with the remainder available for general corporate purposes.
The company also repurchased approximately 1.5 million shares for $62.5 million at an average price of $41.38. About $177.5 million remained under its repurchase authorization at September 30.
Conclusion
Loan growth supported interest income, but higher funding costs and weaker fees limited the benefit. Atlantic Union’s remaining buyback capacity is authorized through May 5, 2027; the unused amount does not represent a commitment to complete further purchases.
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