Mtg Takeaways: Challenger Bank Enters Next Growth Phase; NC Expansion Deep Dive

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Mtg Takeaways: Challenger Bank Enters Next Growth Phase; NC Expansion Deep Dive

, and sustainably top-tier ROTCE profiles (in the high teens).

2. Sandy Spring a key source of revenue synergies and LT growth opportunities,

particularly across treasury management, capital markets, and C&I lending.

The most significant opportunity appears to be leveraging expanded market

presence from Sandy Spring while elevating productivity closer to AUB's

standards, supported by a strong sales culture and execution framework.

Treasury management remains one of the clearest fee growth opportunities post

the Sandy Spring integration with AUB has had meaningful success in

monetizing this platform historically relative to Sandy Spring. Case in point,

legacy AUB generates ~3x the treasury management fees of Sandy Spring

despite operating with a relatively similar TM FTE base. As AUB further monetizes

treasury management services across the Sandy Spring footprint, aided by a

more robust product set alongside a more strategic emphasis on deepening full-

relationship banking, this should support incremental fee growth over time. In

addition, capital markets activity is improving, including increased swap activity

and FX-related opportunities, with additional upside potential as the legacy

Sandy Spring franchise is more deeply integrated into Atlantic Union’s broader

swap platform (given Sandy Spring previously had limited swap capabilities). On

the lending side, while Sandy Spring historically operated with a greater CRE

concentration, AUB is applying the same commercial banking playbook that has

driven success in Virginia and is now extending it into Maryland. While Sandy

Spring's balance sheet had been somewhat constrained from the elevated CRE