UMB Financial Corp. (UMBF) filed Quarterly Report for the period ended 2010-09-30.

Umb Financial Corp. has a market cap of $1.5 billion; its shares were traded at around $36.94 with a P/E ratio of 15.5 and P/S ratio of 2.1. The dividend yield of Umb Financial Corp. stocks is 2.1%. Umb Financial Corp. had an annual average earning growth of 5.1% over the past 10 years.

Highlight of Business Operations:

The first strategy is to grow the Company’s fee-based businesses. The emphasis on fee-based operations helps reduce the Company’s exposure to changes in interest rates. During the third quarter of 2010, noninterest income increased $9.6 million, or 11.9 percent, compared to the same period of 2009. The Company continues to emphasize its asset management, bankcard services, health care services, and treasury management solution businesses. In particular, during the third quarter of 2010, the increase in noninterest income is primarily attributable to increased trust and securities processing income. The increase in these fees for the three month period compared to the same period last year was primarily attributable to an increase in fee income from Scout Funds, fund administration and custody services, and revenues from the acquisition of Prairie Capital Management, LLC. Fee income from the Scout Funds increased by $3.2 million, or 36.0 percent, fund administration and custody services fees increased by $1.8 million, or 12.9 percent, and $1.6 million in increased fee revenues due to the acquisition.

The second strategy is a focus on net interest income through loan and deposit growth, which includes a focus on rate, volume and mix. Net interest income increased $2.5 million for the three months ended September 30, 2010, compared to one year ago. Total loans increased $268.6 million, or 6.2 percent, compared to third quarter of 2009. Total deposits increased $711.6 million, or 9.0 percent, compared to third quarter of 2009. , Of the total deposit growth, 25.9 percent came from non-interest-bearing deposits and is a primary driver of the decrease in total interest expense of $4.5 million, or 34.7 percent. Average earning assets increased by $1.1 billion, or 11.8 percent, compared to the third quarter of 2009 due to the increased deposit funding.

The fourth strategy is a focus on capital management. Specifically, the Company continues to invest in organic growth; acquisition opportunities that make sense strategically, financially, operationally, and culturally; and focus on returning capital to shareholders. As an example of the Company putting capital to work, bankcard fees increased by $2.9 million, or 24.7 percent, for the three months ended September 30, 2010, compared to the same periods one year ago. This increase is directly associated with the acquisition of credit card portfolios since third quarter 2009. The Company repurchased 70,799 shares of common stock at an average price of $33.98 per share during the third quarter of 2010. The Company places a significant emphasis on the maintenance of a strong capital position, which management believes promotes investor confidence, provides access to funding sources under favorable terms, and enhances the Company’s ability to capitalize on business growth and acquisition opportunities. At September 30, 2010, the Company had $1.1 billion in shareholders equity, which resulted in a total risk-based capital ratio of 13.78 percent. This capital ratio is substantially higher than the 10 percent regulatory minimum to be considered well-capitalized.

The Company recorded consolidated net income of $22.8 million for the three-month period ended September 30, 2010, compared to $24.0 million for the same period a year earlier. This represents a 5.1 percent decrease over the three-month period ended September 30, 2009. Basic earnings per share for the third quarter of 2010 were $0.57 per share ($0.57 per share fully-diluted) compared to $0.60 per share ($0.59 per share fully-diluted) for the third quarter of 2009. Return on average assets and return on average common shareholders’ equity for the three-month period ended September 30, 2010 were 0.82 and 8.31 percent, respectively, compared to 0.97 and 9.43 percent for the three-month period ended September 30, 2009.

The Company recorded consolidated net income of $72.0 million for the nine-month period ended September 30, 2010, compared to $65.6 million for the same period a year earlier. This represents a 9.7 percent increase over the nine-month period ended September 30, 2009. Basic earnings per share for the nine-month period ended September 30, 2010 were $1.80 per share ($1.78 per share fully-diluted) compared to $1.62 per share ($1.61 per share fully-diluted) for the period in 2009. Return on average assets and return on average common shareholders’ equity for the nine-month period ended September 30, 2010 were 0.88 and 9.09 percent, respectively, compared to 0.87 and 8.78 percent for the same period in 2009.

Net interest income for the three and nine-month periods ended September 30, 2010 increased $2.5 million, or 3.3 percent, and $6.5 million, or 2.9 percent, respectively, compared to the same period in 2009. These increases are primarily due to the reduced level of interest expense on deposits, which outpaced the reduction in interest income during both periods. For the three-month period ended September 30, 2010, average earning assets increased by $1.1 billion, or 11.8 percent, and for the nine-month period ended September 30, 2010, they increased by $839.6, or 9.1 percent, compared to the same periods in 2009. Net interest margin, on a tax-equivalent basis, decreased to 3.23 percent and 3.24 percent for the three and nine-months periods ended September 30, 2010, compared to 3.51 percent and 3.44 percent for the same periods in 2009. These changes are discussed in greater detail below under Net Interest Income.

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