United Community Banks, Inc. (NYSE: UCB) saw its stock price surge 5.00% in pre-market trading on Tuesday, April 22, 2025, following the release of its first-quarter earnings report that exceeded analyst expectations. The regional bank reported strong loan growth, improved net interest margin, and better-than-anticipated earnings per share, showcasing its resilience in a challenging economic environment.

For the first quarter of 2025, United Community Banks reported operating earnings of $0.59 per diluted share, surpassing the consensus estimate of $0.56 and marking a significant 13% increase from $0.52 in the same quarter last year. The bank's total revenue rose to $247.7 million, up 3.7% year-over-year and slightly above the analyst expectations of $246.9 million.

Chairman and CEO Lynn Harton commented on the results, stating, "The first quarter was a strong start to the year. Our teams delivered solid loan and deposit growth in what has typically been a seasonally weak quarter. Loans grew by $249 million, or 5.6% annualized, and customer deposits increased $309 million, or 5.4% annualized." This robust growth in both loans and deposits demonstrates the bank's ability to expand its business even in traditionally slower periods.

A key driver of the bank's performance was the expansion of its net interest margin, which increased by 10 basis points to 3.36% from the previous quarter. This improvement was attributed to the bank's success in lowering its cost of funds through reduced deposit rates and debt instrument redemptions. The higher margin contributed to a $1.7 million increase in net interest income compared to the fourth quarter of 2024, despite having two fewer accruing days in the period.

Credit quality remained stable, with net charge-offs holding steady at 0.21% of average loans. The bank increased its provision for credit losses by $4.0 million from the previous quarter, covering both net charge-offs and loan growth. This prudent approach slightly increased the allowance for credit losses to 1.21% of loans, up from 1.20% at the end of 2024.

United Community Banks also made progress in controlling expenses, with noninterest expenses improving on both a GAAP and operating basis compared to the previous quarter and the same period last year. The efficiency ratio improved to 56.2% on an operating basis, reflecting the bank's focus on cost management while driving growth.

Looking ahead, the bank announced its planned acquisition of American National Bank in Oakland Park, Florida, which is expected to close on May 1. This strategic move will strengthen United Community Banks' presence in the fast-growing South Florida market, potentially driving future growth and expansion opportunities.

The strong quarterly results and positive outlook have clearly resonated with investors, as reflected in the stock's 5% pre-market surge. As United Community Banks continues to execute its growth strategy and maintain solid financial performance, it appears well-positioned to navigate the evolving banking landscape and deliver value to its shareholders.