Accelerating Growth Ahead; Specific Investment of Navitas Proceeds Still TBD

研报英文原文证据摘录

Accelerating Growth Ahead; Specific Investment of Navitas Proceeds Still TBD

C O M PA N Y N O T E

J u l y 2 1 , 2 0 2 6

• Upward NIM Trajectory Expected Post Navitas Close - The NIM has expanded for the

last six consecutive quarters, however the NIM is expected to contract by 20-25 bps into

4Q26 (impact in 3Q dependent on deal close), as the Navitas transaction creates a static

NIM headwind. Positively, the core NIM should widen as loan growth accelerates, back-book

repricing continues, and the Navitas proceeds are used to pay down borrowings, shrinking

the balance sheet modestly. Beyond that, the underlying widening trend is expected to fully

offset that headwind over the following 2 quarters, putting 4Q26 bank on the expansion path.

That said, loan yields are expected to decline ~30 bps with Navitas's exit, but new production

is coming on at rates above that lower base, supporting an increasing loan yield trajectory off

the reset. On the liability side, deposit costs are expected to drift slightly higher in 2H due an

increasing competitive landscape.

• Loan Growth & Capital Deployment - Excluding Navitas, loan growth of 6.4% LQA was

solid, led by strong growth in HELOC (+18% LQA), C&I (+13%) and owner-occupied CRE

(+8%), while residential was weaker (-3% LQA). Management plans to drive further organic

loan growth across C&I and CRE segments through strategic hiring. On the capital front, UCB

has $63M remaining under its repurchase authorization and reaffirmed its intent to repurchase

the remaining $50M of Peach State stock consideration this year, but we are modeling for

additional repurchases in lieu of definitive clarity around other actions from the Navitas capital

and liquidity. Management is open to exploring further M&A opportunities, targeting smaller