May 26, 2017
VIA EDGAR
Mr. Marc Thomas
Mr. Gus Rodriguez
Division of Corporation Finance
Securities and Exchange Commission
100 F Street, N.E.
Washington, DC 20549
Mail Stop 4720
Re: | United Bankshares, Inc. |
Form 10-K for Fiscal Year Ended December 31, 2016
Filed March 1, 2017
File Number 002-86947
Gentlemen:
This letter is provided on behalf of United Bankshares, Inc. (“United” or the “Company”) in response to your letter of May 15, 2017 regarding the Company’s Form 10-K for the fiscal year ended December 31, 2016. In accordance with your request, we have responded to each of the comments included in your letter.
Set forth below in italics are each of the comments contained in the staff’s letter, together with the Company’s responses. The items are set forth in the order in which they appear in the staff’s letter.
Form 10-K for Fiscal Year Ended December 31, 2016
Management’s Discussion and Analysis of Financial Condition and Results of Operations
2016 Compared to 2015
Loans, page 44
1. | Due to the increase in acquired loans from recent acquisitions please revise in future filings to disclose detailed information on the amount of loans acquired and outstanding by loan type for each period presented. |
United Bankshares, Inc.
Form 10-K for Fiscal Year Ended December 31, 2016
Page 2
Response:
In future filings of United’s Form 10-K, we will include the following additional tabular disclosure:
December 31, 20xx | ||||||||||||||||||||
(In thousands) | Commercial, financial and agricultural | Residential real estate | Construction & land development | Consumer | Total | |||||||||||||||
Originated | $ | x,xxx,xxx | $ | xxx,xxx | $ | xxx,xxx | $ | xxx,xxx | $ | x,xxx,xxx | ||||||||||
Acquired | xxx,xxx | xxx,xxx | xxx,xxx | xxx,xxx | x,xxx,xxx | |||||||||||||||
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Total gross loans | $ | x,xxx,xxx | $ | x,xxx,xxx | $ | x,xxx,xxx | $ | x,xxx,xxx | $ | x,xxx,xxx | ||||||||||
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December 31, 20xx | ||||||||||||||||||||
(In thousands) | Commercial, financial and agricultural | Residential real estate | Construction & land development | Consumer | Total | |||||||||||||||
Originated | $ | x,xxx,xxx | $ | xxx,xxx | $ | xxx,xxx | $ | xxx,xxx | $ | x,xxx,xxx | ||||||||||
Acquired | xxx,xxx | xxx,xxx | xxx,xxx | xxx,xxx | x,xxx,xxx | |||||||||||||||
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Total gross loans | $ | x,xxx,xxx | $ | x,xxx,xxx | $ | x,xxx,xxx | $ | x,xxx,xxx | $ | x,xxx,xxx | ||||||||||
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Provision for Loan Losses, page 50
2. | Due to the significant increase in acquired loans please revise in future filings to disclose the remaining credit marks outstanding for each period presented. |
Response:
We interpret the term “credit mark” to be synonymous with the accounting concept of “non-accretable difference.” Therefore, in future filings of United’s Form 10-K, we propose to provide the following additional disclosure:
Acquired impaired loans are accounted for under ASC Subtopic 310-30. The contractual principal balance of the acquired impaired loans was $xxx,xxx,xxx and $xxx,xxx,xxx at December 31, 20xx and 20xx, respectively. For acquired impaired loans accounted for under ASC 310-30, the difference between the contractually required payments due and the cash flows expected to be collected, considering the impact of prepayments, is referred to as the non-accretable difference. The non-accretable difference is not recognized in income. The remaining non-accretable difference was $xx,xxx,xxx and $xx,xxx,xxx at December 31, 20xx and 20xx, respectively.
United Bankshares, Inc.
Form 10-K for Fiscal Year Ended December 31, 2016
Page 3
Provision for Loan Losses, page 50
3. | Please tell us and revise, in future filings, the tabular disclosures for nonperforming assets on page 51 to disclose information which enables the reader to more clearly understand the impact of acquired loans on the level of nonaccrual loans, loans contractually past due 90 days and accruing and restructured loans for each period presented. |
Response:
The table below reflects the information requested by the staff and will be included in future filings of United’s Form 10-K.
December 31, | ||||||||||||||||||||
(In thousands) | 2016 | 2015 | 2014 | 2013 | 2012 | |||||||||||||||
Nonaccrual Loans | ||||||||||||||||||||
Originated | $ | 77,111 | $ | 83,146 | $ | 64,312 | $ | 58,121 | $ | 66,711 | ||||||||||
Acquired | 6,414 | 8,043 | 10,739 | 3,807 | 4,848 | |||||||||||||||
Loans which are contractually past due 90 days or more as to interest or principal, and are still accruing interest | ||||||||||||||||||||
Originated | 7,763 | 11,462 | 10,868 | 10,015 | 13,819 | |||||||||||||||
Acquired | 823 | 166 | 807 | 1,029 | 4,249 | |||||||||||||||
Restructured loans | ||||||||||||||||||||
Originated | 21,115 | 23,890 | 22,234 | 8,157 | 3,175 | |||||||||||||||
Acquired | 37 | 0 | 0 | 0 | 0 | |||||||||||||||
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Total nonperforming loans | $ | 113,263 | $ | 126,707 | $ | 108,960 | $ | 81,129 | $ | 92,802 | ||||||||||
Other real estate owned | 31,510 | 32,228 | 38,778 | 38,182 | 49,484 | |||||||||||||||
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TOTAL NONPERFORMING ASSETS | $ | 144,773 | $ | 158,935 | $ | 147,738 | $ | 119,311 | $ | 142,286 | ||||||||||
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Provision for Loan Losses, page 50
4. | We note the disclosure of the non-GAAP measure “Allowance for Loan Losses/Non-acquired Loans, net of unearned income.” In determining this ratio, you have eliminated “acquired loans.” Please tell us whether the amounts disclosed are representative of all of the remaining “acquired loans” at each respective reporting period or are they representative of the “acquired loans” which have a remaining credit mark. |
United Bankshares, Inc.
Form 10-K for Fiscal Year Ended December 31, 2016
Page 4
Response:
In determining the ratio “Allowance for Loan Losses/Non-acquired Loans, net of unearned income,” we have eliminated all remaining acquired loans at each respective reporting period. In future filings, we will clarify that the ratio eliminates all remaining acquired loans.
If you should have any further questions regarding these filings, please do not hesitate to contact the undersigned at (304) 424-8716.
Sincerely,
/s/ W. Mark Tatterson
W. Mark Tatterson
Chief Financial Officer
514 Market Street, Parkersburg, WV 26102