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UMB Financial (UMBF) Restructures Investment Banking Business

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UMB Financial Corporation (UMBF - Free Report) recently restructured its investment banking division and renamed it Capital Markets Division. The unit will provide a full range of capital solutions such as fixed income sales and trading, public finance, corporate bond underwriting and private placements along with municipal advisory solutions.

The company expects its broad and diverse investor base of bank and non-bank institutional networks in the United States to support this new division. Further, the move reflects UMB Financial’s confidence in its investment banking business, which is currently booming due to the rebound in IPOs and rising M&A deal announcements.

"We are excited to announce the Capital Markets Division, which continues to deliver our full range of innovative capital solutions and fully conveys the extensive amount of services UMB Bank can offer clients," said Jim Cornelius, president of Institutional Banking, UMB Bank.

He added, "Our service-first approach, paired with our market insight, strong underwriting capabilities and consistent capital backing uniquely positions the Capital Markets Division to serve financial institutions, municipalities, corporations, higher education institutions and other public and not-for-profit organizations across the country."

Among services, it will provide fixed income sales and trading solutions to financial institutions and corporations, both in the primary and secondary market, so as to meet liquidity and investment goals. Also, public finance groupwill offer multiple financing structures that allow issuers to efficiently access the marketplace to meet capital needs.

Corporate bond underwriting and private placements solutions will guide clients to raise capital through the bond market to support their growth. Lastly, municipal advisoryservices,launched in July 2020, help higher education institutions secure financial solutions for their capital needs and manage their debt portfolios, utilizing UMB Financial’s municipal advisory capabilities.

Our Viewpoint

Restructuring of businesses is always good news as it reflects management’s focus on improving the company’s performance. Thus, UMB Financial’s initiatives are expected to support profitability and help counter the slowdown due to the pandemic.

Shares of UMB Financial have gained 42.3% over the past six months compared with 31.3% growth recorded by the industry.

Currently, the stock carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Stocks to Consider

Some other top-ranked finance stocks are Investors Bancorp, Inc. , First Hawaiian, Inc. (FHB - Free Report) and Northrim BanCorp Inc (NRIM - Free Report) . All these companies currently sport a Zacks Rank #1.

Earnings estimates for Investors Bancorp have been revised upward for 2020 over the past 60 days. Its share price has rallied 28.9% over the past six months.

First Hawaiian’s earnings estimates have been revised upward for 2020 over the past 60 days. Also, in six months’ time, its share price has increased 41.5%.

Northrim has witnessed an upward earnings estimate revision for 2020 over the past 60 days. Also, its share price has seen a 42.8% rise over the past six months.

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