UMB Financial's Loan Growth Cools From Second Quarter

The Tip Desk · November 8, 2026 · 4 min read

Net interest income reached $540.0 million as average loans rose 11.1% annualized, slower than the 12.6% pace in the second quarter.

UMB Financial Corporation (UMBF), a financial services company, reported net interest income of $540.0 million for the third quarter of 2026, up 13.7% from the year-earlier quarter, as average loans rose 11.1% on a linked-quarter annualized basis to $41.7 billion — a slower pace than the 12.6% annualized increase recorded in the second quarter.

GAAP net income available to common shareholders was $272.3 million, or $3.56 a share, up 51.0% from $180.4 million, or $2.36 a share, in the third quarter of 2025. Net operating income available to common shareholders was $272.4 million, or $3.56 a share. Operating pre-tax, pre-provision income was $373.0 million, or $4.88 a share, down 1.8% from the linked quarter.

The company said the year-over-year rise in net interest income of $65.0 million was driven by increases of $4.6 billion, or 12.4%, in average loans and $722.9 million, or 3.8%, in average securities, as well as favorable repricing of deposits in conjunction with lower short-term interest rates. Those gains were partially offset by a $3.1 billion, or 49.0%, decrease in average interest-bearing due from banks and $7.5 million in lower purchase accounting accretion income. Net interest margin on a fully taxable equivalent basis was 3.32%, up 28 basis points from the third quarter of 2025 and unchanged from the linked quarter.

Average commercial and industrial loan balances increased 21.5% on a linked-quarter annualized basis to $18.5 billion, and 24.9% from the third quarter of 2025. Chairman and chief executive officer Mariner Kemper said average C&I balances increased approximately 22% on a linked-quarter annualized basis, driving an 11% annualized increase in total average loans. Gross loan production reached a record $3.1 billion, compared with $2.6 billion in the linked quarter; net loan growth after payoffs and paydowns totaled $1.4 billion. End-of-period loans were $42.5 billion at September 30, 2026.

Average deposits increased 4.4% on a linked-quarter annualized basis to $58.2 billion and 2.6% from the third quarter of 2025. Average noninterest-bearing demand deposits declined 6.1% from the linked quarter, which the company said reflected expected seasonal disbursements within the institutional banking segment. Noninterest-bearing deposits comprised 23.7% of total deposits, compared with 25.5% in the linked quarter.

Noninterest income was $232.4 million, up 14.3% from the third quarter of 2025. Versus the linked quarter, noninterest income fell $13.1 million, or 5.3%, largely due to a $16.1 million net decrease in investment securities gains after a $17.9 million gain on the sale of a non-marketable security in the second quarter. Trust and securities processing rose $4.8 million on fund services and $0.6 million on corporate trust.

GAAP noninterest expense was $399.5 million, down 4.7% from the third quarter of 2025, when the company recorded $35.6 million in acquisition-related and other nonrecurring costs, including $19.2 million in fees for termination of legacy Heartland Financial USA contracts. Third-quarter 2026 acquisition-related and other nonrecurring costs were $0.1 million. The GAAP efficiency ratio improved to 48.71% from 58.09% a year earlier. Return on average assets was 1.53% and return on average common equity was 13.83%.

Net charge-offs totaled $14.0 million, or 13 basis points of average loans, compared with 16 basis points in the linked quarter and 20 basis points in the third quarter of 2025. Nonperforming loans declined 7.6% to $117.9 million, or 28 basis points of total loans, from 31 basis points at June 30, 2026. The provision for credit losses was $31.0 million, up $3.0 million from the linked quarter; the company said the change reflected continued loan growth, ongoing recalibration of econometric loss models, and general portfolio trends.

The common equity Tier 1 capital ratio was 11.50% at September 30, 2026. In mid-September the company redeemed $150.0 million of 2.75% fixed-to-floating subordinated notes due 2031. Kemper said persistent inflation, the conflict in the Middle East, and higher short- and long-term interest rates may create headwinds, and that the company’s interest-rate-neutral balance sheet and diversified financial services model position it to navigate the anticipated environment.