Atlantic Union Bankshares in Richmond, Va., said a series of balance sheet moves, a legal reserve and a higher loan-loss provision cut into quarterly profit.
The $21 billion-asset company’s first-quarter net income available for shareholders fell by 19.7% from a year earlier, to $32.7 million.
Atlantic Union said that it sold $505.7 million of securities between Jan. 18 and March 9 at a pretax loss of $13.4 million. Net proceeds were used to reduce Federal Home Loan Bank borrowings.
The company should earn back the loss in roughly two years.
Atlantic Union also created a $5 million legal reserve during the first quarter tied to an ongoing regulatory matter. The company had previously disclosed that the Consumer Financial Protection Bureau is considering legal action tied to its overdraft practices and policies.
The company’s loan-loss provision jumped to $11.9 million in the first quarter from $2.8 million a year earlier.
Net interest income increased by 17%, to $153 million. The net interest margin widened by 44 basis points, to 3.41%.
Deposits fell slightly, to $16.5 billion, while loans held for investment increased by 8%, to $14.6 billion.