CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has affirmed UMB Financial Corporation (UMBF) and its principal banking subsidiary, UMB Bank N.A., long-term Issuer Default Ratings (IDR) of 'A+' and the short-term IDRs of 'F1+'. The Rating Outlook remains Stable. A full list of ratings follows at the end of this release.

Today's rating affirmation reflects UMB's long history as a conservatively managed company under control of the Kemper family. This has fostered a culture that has helped the bank to maintain strong asset quality, high capital levels, and good financial flexibility over many years. This has been particularly noteworthy over the last few years, as the company avoided many of the pitfalls that have plagued the rest of the banking industry. Instead, the company has been able to continue to execute on strategies to grow both its diverse set of businesses while maintaining a solid balance sheet, thereby helping its overall performance far exceed that of many of its regional bank peers.

Given this positioning, UMB has gathered additional low-cost deposits, which have helped to boost the company's overall spread income. Furthermore, the company has not wavered from its conservative underwriting standards, which has caused the company to experience relatively flat loan growth, although excellent credit quality. Moreover, while the company has successfully grown deposits, much of this increase has been directed toward the investment portfolio, which is now the largest earning asset on the balance sheet. Fitch expects this lack of loan growth and the short duration of the investment portfolio to continue to pressure the company's net interest margin in the near term, although this is less concerning given UMB's strong and diverse fee-based revenues, which account for 53% of total revenues.

Fitch believes that additional near-term revenue growth for the company will come primarily in its fee-based businesses both organically and via acquisition, while balance sheet growth is likely to come through growth in home equity loans and credit cards. UMB's strong fee-based revenues are balanced by the view that these expose the company to equity markets risk via the asset servicing, wealth management, and asset management businesses, and thus may be more volatile. To date, Fitch believes this risk has been well controlled, though overall earnings will be more sensitive to changes in equity market values. While UMB has grown its credit card business and home equity portfolios, which should help overall net interest margins, these products could produce higher credit costs as they season.

Fitch notes that UMB's ratings are solidly situated at the higher end of their potential range. Although not anticipated, ratings could be affected if there were material changes in ownership or management. In addition, although volatility in either equity markets or interest rates could negatively affect earnings, Fitch believes UMBF's solid balance sheet would remain intact, supporting the Stable Rating Outlook.

Fitch has affirmed the following ratings:

UMB Financial Corporation
--Long-term Issuer Default Rating (IDR) at 'A+';
--Short-term IDR at 'F1+';
--Individual at 'B';
--Support at '5';
--Support floor at 'NF'.

UMB Bank, National Association
--Long-term deposits at 'AA-';
--Long-term IDR at 'A+';
--Short-term deposits at 'F1+';
--Short-term IDR at 'F1+';
--Individual at 'B';
--Support at '5';
--Support floor 'NF'.

Additional information is available at www.fitchratings.com.

Applicable Criteria
--'Global Financial Institutions Rating Criteria', Aug. 16, 2010;
--'Bank Holding Company Criteria', Dec. 30, 2009.

Related Research:
Global Financial Institutions Rating Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=547685
Bank Holding Companies
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=493324

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CONTACT:

Fitch Ratings
Primary Analyst:
Justin Fuller, CFA, +1-312-368-2057
Director
70 West Madison
Chicago, IL 60602
or
Secondary Analyst:
Julie Solar, +1-312-368-5472
Senior Director
or
Committee Chairperson:
Thomas Abruzzo, +1-212-908-0793
Managing Director
or
Media Relations:
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brian.bertsch@fitchratings.com

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