United Community Banks delivered a strong close to 2025, demonstrating significant financial improvements across key metrics. The institution achieved substantial revenue growth and margin expansion, supported by strategic initiatives aimed at enhancing shareholder value and preparing for evolving interest rate landscapes. These results underscore a successful year characterized by careful financial management and targeted growth efforts.
Fiscal Performance Highlights of Q4 2025
In the final quarter of 2025, United Community Banks showcased impressive financial strength, with an 11% increase in revenue compared to the previous year. This growth was primarily fueled by an expanding net interest margin and a healthy 4.4% annualized growth in its loan portfolio. Operating earnings per share reached $0.71, marking a 13% increase year-over-year. The bank also achieved a return on assets of 1.22% and a return on tangible common equity of 13.3%, reflecting efficient capital utilization and solid profitability.
For the entire fiscal year, the bank reported an 18% surge in operating earnings per share, reaching $2.71. Key operational enhancements included a 23-basis-point increase in net interest margin, a 264-basis-point improvement in the efficiency ratio, and a reduction in credit losses. The bank's annual revenue surpassed $1 billion, representing a 12% growth from the prior year. Loan growth was particularly strong in Commercial & Industrial (C&I) and Home Equity Line of Credit (HELOC) segments, with the fourth quarter setting a new record for bank production. The Novitas equipment finance division also saw originations exceed $1 billion for the first time, though management aims to cap its total loan exposure at 10%.
Strategic Capital Management and Future Outlook
United Community Banks actively managed its capital throughout the year, increasing its dividend to an annualized rate of $1 per share in the third quarter and repurchasing 1 million shares in the fourth quarter. The bank also redeemed its preferred stock, reflecting a commitment to returning value to shareholders. Looking ahead to 2026, management plans to be more assertive with share buybacks, citing robust capital generation, stable credit quality, and a less competitive M&A environment.
The bank's deposit strategy effectively navigated seasonal fluctuations, with a notable increase of $293 million in public funds in Q4. The cost of deposits improved by 21 basis points to 1.76%, and the cumulative total deposit beta rose to 40%. The net interest margin increased by four basis points to 3.62% in the quarter, with expectations for an additional two to four basis point rise in Q1 2026. Management anticipates continued growth and improvement in 2026, supported by strong market economies, ongoing investments in talent and systems, and a sustained focus on organic growth initiatives. Despite minor charge-offs from two C&I loans, the bank's credit quality remains strong, with an expected loss rate of 20-25 basis points for 2026.