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F.N.B. Corporation Reports Second Quarter 2024 Earnings

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F.N.B. (NYSE: FNB) reported Q2 2024 earnings with a net income of $123.0 million, or $0.34 per diluted share, compared to $140.4 million, or $0.39 per share, in Q2 2023. Linked-quarter net income increased from $116.3 million, or $0.32 per share, in Q1 2024. Loan and deposit growth were 3.6% and 0.7%, respectively.

Pre-provision net revenue (non-GAAP) grew by 4% compared to Q1 2024. Tangible book value per share rose 12% YoY to $9.88. Net interest income dropped by $13.4 million YoY due to higher deposit costs and increased borrowings. Non-interest income improved by 9.5% YoY, with service charges and mortgage banking operations income rising. Non-interest expense increased by 6.9% YoY due to higher salaries and tech investments.

The CET1 ratio remained stable at 10.2%. The efficiency ratio stood at 54.4%, and the provision for credit losses rose to $20.2 million to support strong loan growth. The company repurchased 250,000 shares at $13.56 per share. The effective tax rate was 21.6%.

Positive
  • Net income increased to $123.0 million QoQ.
  • Pre-provision net revenue (non-GAAP) rose by 4%.
  • Tangible book value per share grew 12% YoY.
  • Non-interest income increased by 9.5%.
  • Non-performing loans and OREO ratio at 0.33%, a multiyear low.
  • Repurchased 250,000 shares.
Negative
  • Net income decreased to $123.0 million YoY.
  • Net interest income dropped by $13.4 million YoY.
  • Non-interest expense increased by 6.9% YoY.
  • Provision for credit losses rose to $20.2 million.

Insights

F.N.B. Corporation's second quarter 2024 earnings report reveals mixed performance metrics. Although net income decreased year-over-year from $140.4 million to $123.0 million, there was sequential growth from the previous quarter's $116.3 million. This fluctuation emphasizes the challenge of maintaining profitability amidst rising costs and changing interest rates. The earnings per diluted common share stood at $0.34, consistent with previous quarters but a decline from last year’s $0.39. Notably, the bank's tangible book value per share rose 12% year-over-year to $9.88, showing robust internal value growth.

The report highlights growth in both loans and deposits, with loans increasing by 7.7% year-over-year. This signifies successful customer acquisition and retention, bolstered by strategic investments. However, the net interest income slightly decreased due to rising deposit costs, underscoring the impact of a high-interest-rate environment. The efficiency ratio remained solid at 54.4%, indicating effective expense management despite increased non-interest expenses related to salaries and technology investments.

For retail investors, this report presents a complex picture. While loan and deposit growth reflects operational strength, the decreasing net income could be concerning. Investors should weigh the bank's solid asset quality and capital position against the pressures of rising costs and interest rates.

Examining F.N.B. Corporation's market strategies, the report shows effective customer engagement and market share growth. The bank's investments in the eStore® platform and experienced banking teams have paid off, as evidenced by increases in both commercial loans and consumer loans. The 3.6% linked-quarter growth in loans and 0.7% growth in deposits highlight the bank’s dynamic market presence.

The non-interest income growth of 9.5% year-over-year is noteworthy, driven by treasury management services, mortgage banking operations and wealth management. This diversified income stream can help mitigate the impact of fluctuating interest rates on core banking income. Additionally, the increase in time deposits signifies customers’ trust in F.N.B. Corporation's long-term financial products, although it also reflects a shift towards higher-yielding deposits due to the current interest rate environment.

Retail investors should appreciate the bank's strategic initiatives and diversified income sources. However, it’s important to monitor how these factors influence profitability amidst broader economic trends.

From a credit risk perspective, F.N.B. Corporation's second quarter report is reassuring. The bank maintained a low ratio of non-performing loans (NPLs) and other real estate owned (OREO) at 0.33%, among multi-year lows. The provision for credit losses was $20.2 million, reflecting robust loan growth support while keeping delinquencies at a minimal 0.63%.

Despite broadening their loan portfolio, F.N.B. Corporation has managed to keep its asset quality stable. The company’s approach to credit risk management and maintaining a strong capital position with a CET1 ratio of 10.2% is commendable. Their strategies seem effective in mitigating potential risks while promoting growth, important in a competitive banking landscape.

For retail investors, the solid asset quality and stringent risk management practices provide a sense of security. The stable credit metrics indicate that the bank’s growth is not coming at the cost of increased risk.

Continues to Gain Market Share with Loan and Deposit Linked-Quarter Growth of 3.6% and 0.7%, Respectively

PITTSBURGH, July 17, 2024 /PRNewswire/ -- F.N.B. Corporation (NYSE: FNB) reported earnings for the second quarter of 2024 with net income available to common stockholders of $123.0 million, or $0.34 per diluted common share. Comparatively, second quarter of 2023 net income available to common stockholders totaled $140.4 million, or $0.39 per diluted common share, and first quarter of 2024 net income available to common stockholders totaled $116.3 million, or $0.32 per diluted common share.

On an operating basis, second quarter of 2024 earnings per diluted common share (non-GAAP) was $0.34, excluding less than $0.01 of significant items impacting earnings per diluted common share. By comparison, the second quarter of 2023 was $0.39 per diluted common share (non-GAAP) on an operating basis, excluding less than $0.01 of significant items impacting earnings per diluted common share. The first quarter of 2024 was $0.34 per diluted common share (non-GAAP) on an operating basis, excluding $0.02 of significant items impacting earnings per diluted common share.

"Through the continued execution of our disciplined business model, F.N.B. Corporation produced solid second quarter results with earnings per diluted common share (non-GAAP) totaling $0.34. Pre-provision net revenue (non-GAAP) increased over 4%, on a linked-quarter basis, supported by our well-managed expenses and continued strong non-interest income levels. Tangible book value per share grew 12% year-over-year to reach a record high at $9.88," said F.N.B. Corporation Chairman, President and Chief Executive Officer, Vincent J. Delie, Jr. "FNB's linked-quarter loan and deposit growth of 3.6% and 0.7%, respectively, including non-interest-bearing deposits growth of 0.8%, demonstrates our ability to execute on our strategy to steadily increase market share by leveraging our investments in eStore® and our experienced banking teams. FNB's capital position remained strong as we were able to support robust loan growth and maintain the tangible common equity ratio near 8% and CET1 ratio at 10.2%. Our comprehensive approach to credit risk management has led to strong and stable asset quality results with NPLs and OREO ending at 0.33%, a multiyear low, and net charge-offs at a very solid 0.09%. We remain well-positioned for a better rate environment as we move into 2025."

Second Quarter 2024 Highlights
(All comparisons refer to the second quarter of 2023, except as noted)

  • Period-end total loans and leases increased $2.4 billion, or 7.7%. Commercial loans and leases increased $1.4 billion, or 7.2%, and consumer loans increased $989.5 million, or 8.5%. FNB's loan growth was driven by the continued success of our strategy to grow high-quality loans and deepen customer relationships across our diverse geographic footprint.
  • On a linked-quarter basis, period-end total loans and leases increased $1.2 billion, or 3.6%, with an increase in consumer loans of $632.7 million and commercial loans and leases of $540.1 million, including healthy growth in commercial and industrial loans and equipment finance, as well as the seasonal peak for residential mortgage originations.
  • Period-end total deposits increased $1.2 billion, or 3.5%, driven by an increase of $1.6 billion in time deposits with customers continuing to opt for higher-yielding deposit products.
  • On a linked-quarter basis, period-end total deposits increased $258.6 million, or 0.7%, with an increase in non-interest-bearing deposits of 0.8%. The mix of non-interest-bearing deposits to total deposits equaled 29% at June 30, 2024, consistent with the prior quarter-end.
  • Net interest income totaled $315.9 million, a decrease of $3.1 million, or 1.0%, from the prior quarter, primarily due to higher cost of funds from increased average borrowings and higher cost of interest-bearing deposits, partially offset by improved earning asset yields and loan growth.
  • Net interest margin (FTE) (non-GAAP) decreased 9 basis points to 3.09% from the prior quarter, largely due to increased short-term borrowings to fund the strong loan growth in the quarter as a 3 basis point increase in the total yield on earning assets (non-GAAP) to 5.43% was more than offset by a 13 basis point increase in the total cost of funds to 2.46%.
  • Non-interest income totaled $87.9 million, an increase of 9.5% from the year-ago quarter, benefiting from our diversified business model.
  • Pre-provision net revenue (non-GAAP) totaled $177.2 million, a 4.4% increase from the prior quarter. On an operating basis, pre-provision net revenue (non-GAAP) totaled $178.0 million, a 3.0% increase from the prior quarter, driven by a decrease in non-interest expense and continued strong non-interest income generation. Reported non-interest expense included an additional FDIC insurance special assessment expense (pre-tax) of $0.8 million due to last year's bank failures, bringing the year-to-date FDIC special assessment expense to $5.2 million.
  • The efficiency ratio (non-GAAP) remained at a solid level of 54.4%, compared to 50.0% at June 30, 2023, and 56.0% at March 31, 2024.
  • The provision for credit losses was $20.2 million, an increase of $6.3 million from the prior quarter to support the strong loan growth. The ratio of non-performing loans and other real estate owned (OREO) to total loans and OREO was stable at 0.33%. Total delinquency decreased 1 basis point to 0.63%. Both measures continue to remain at or near historically low levels.
  • The Common Equity Tier 1 (CET1) regulatory capital ratio was 10.2% (estimated), compared to 10.1% at June 30, 2023, and 10.2% at March 31, 2024. Tangible book value per common share (non-GAAP) of $9.88 increased $1.09, or 12.4%, compared to June 30, 2023, and $0.24, or 2.5%, compared to March 31, 2024. Accumulated other comprehensive income/loss (AOCI) reduced the tangible book value per common share (non-GAAP) by $0.67 as of June 30, 2024, primarily due to the impact of interest rates on the fair value of available-for-sale (AFS) securities, compared to a reduction of $0.99 as of June 30, 2023, and $0.70 as of March 31, 2024.
  • During the second quarter of 2024, the Company repurchased 250,000 shares of common stock at a weighted average share price of $13.56 while maintaining capital at or above stated operating levels and supporting loan growth in the quarter.

Non-GAAP measures referenced in this release are used by management to measure performance in operating the business that management believes enhances investors' ability to better understand the underlying business performance and trends related to core business activities. Reconciliations of non-GAAP operating measures to the most directly comparable GAAP financial measures are included in the tables at the end of this release. For more information regarding our use of non-GAAP measures, please refer to the discussion herein under the caption, Use of Non-GAAP Financial Measures and Key Performance Indicators.

Quarterly Results Summary

2Q24


1Q24


2Q23

Reported results






Net income available to common stockholders (millions)

$      123.0


$      116.3


$      140.4

Net income per diluted common share

0.34


0.32


0.39

Book value per common share

16.94


16.71


15.92

Pre-provision net revenue (non-GAAP) (millions)

177.2


169.8


197.6

Operating results (non-GAAP)






Operating net income available to common stockholders (millions)

$      123.7


$      122.7


$      140.5

Operating net income per diluted common share

0.34


0.34


0.39

Operating pre-provision net revenue (millions)

178.0


172.8


197.8

Average diluted common shares outstanding (thousands)

362,701


362,619


362,626

Significant items impacting earnings1 (millions)






Preferred dividend equivalent at redemption

$            —


$        (4.0)


$            —

Pre-tax merger-related expenses



(0.2)

After-tax impact of merger-related expenses



(0.1)

Pre-tax branch consolidation costs


(1.2)


After-tax impact of branch consolidation costs


(0.9)


Pre-tax FDIC special assessment

(0.8)


(4.4)


After-tax FDIC special assessment

(0.6)


(3.5)


Pre-tax loss on indirect auto loan sale


2.6


After-tax loss on indirect auto loan sale


2.1


Total significant items after-tax

$        (0.6)


$        (6.3)


$        (0.1)

Capital measures






Common equity tier 1 (2)

10.2 %


10.2 %


10.1 %

Tangible common equity to tangible assets (non-GAAP)

7.86


7.99


7.47

Tangible book value per common share (non-GAAP)

$        9.88


$        9.64


$        8.79







(1) Favorable (unfavorable) impact on earnings.

(2) Estimated for 2Q24.

 

Second Quarter 2024 Results – Comparison to Prior-Year Quarter
(All comparisons refer to the second quarter of 2023, except as noted)

Net interest income totaled $315.9 million, a decrease of $13.4 million, or 4.1%, primarily due to higher deposit costs resulting from balance migration to higher yielding deposit products, as well as increased total average borrowings, partially offset by growth in earning assets and higher earning asset yields. Total average earning assets increased $1.9 billion, or 4.8%, driven by an increase in average loans and leases from solid origination activity. Total average borrowings increased $761.7 million to support strong loan growth.

The net interest margin (FTE) (non-GAAP) decreased 28 basis points to 3.09%. The yield on earning assets (non-GAAP) increased 49 basis points to 5.43%, reflecting the higher interest rate environment. The increase was driven by a 65 basis point increase on investment securities to 3.14% which benefited from the balance sheet restructuring in late 2023 and a 43 basis point increase on loans to 5.96%. Total cost of funds increased 82 basis points to 2.46% with a 96 basis point increase in interest-bearing deposit costs to 2.93%, and an increase of 122 basis points in short-term borrowing costs to fund the strong loan growth. Since the current interest rate increases began in March 2022, our total cumulative spot deposit beta equaled 38% at June 30, 2024, consistent with our expectations. 

Average loans and leases totaled $33.3 billion, an increase of $2.2 billion, or 7.1%, including growth of $1.3 billion in commercial loans and leases and $943.7 million in consumer loans. Commercial real estate increased $970.6 million, or 8.3%, commercial and industrial loans increased $224.7 million, or 3.1%, and commercial leases increased $68.3 million, or 11.6%. The increase in average commercial loans and leases was driven by activity across the footprint, with double-digit year-over-year growth across the Carolinas. The Pittsburgh and Cleveland regions and commercial equipment finance also posted strong contributions. The increase in commercial real estate included fundings on previously originated projects. The increase in average consumer loans included a $1.3 billion increase in residential mortgages largely due to the continued successful execution in key markets by our expanded mortgage banker team and long-standing strategy of serving the purchase market. This growth was partially offset by a decrease in indirect auto loans of $363.0 million reflecting the sale of $332 million of such loans that closed in the first quarter of 2024.

Average deposits totaled $34.6 billion, an increase of $813.8 million, or 2.4%, from the prior-year quarter. The growth in average time deposits of $1.6 billion and average interest-bearing demand deposits of $740.0 million more than offset the decline in average non-interest-bearing demand deposits of $1.1 billion and average savings deposits of $483.2 million as customers continued to migrate balances into higher-yielding products. While the funding mix has shifted compared to the year-ago quarter with non-interest-bearing deposits comprising 29% of total deposits at June 30, 2024, compared to 32% a year ago, it has remained stable compared to both March 31, 2024, and December 31, 2023.

Non-interest income totaled $87.9 million, a 9.5% increase compared to $80.3 million in the second quarter of 2023. Service charges increased $2.8 million, or 13.6%, primarily due to strong Treasury Management activity and higher consumer transaction levels. Mortgage banking operations income increased $2.0 million, driven by improved gain on sale from strong production volumes. Wealth Management revenues increased $1.8 million, or 10.2%, as securities commissions and fees and trust income increased 13.7% and 7.9%, respectively, through continued strong contributions across the geographic footprint. Dividends on non-marketable equity securities increased $1.4 million, reflecting higher Federal Home Loan Bank (FHLB) dividends due to additional borrowings.

Non-interest expense totaled $226.6 million, increasing $14.7 million, or 6.9%. When adjusting for $0.8 million1 of significant items in the second quarter of 2024 and $0.2 million2 in the second quarter of 2023, operating non-interest expense (non-GAAP) totaled $225.8 million, an increase of $14.0 million, or 6.6%. Salaries and benefits increased $7.0 million, or 6.1%, primarily from normal annual merit increases and higher production-related commissions given the strong non-interest income activity. Net occupancy and equipment increased $4.9 million, or 13.0%, largely from technology-related investments. Outside services increased $2.7 million, or 13.2%, with higher third-party and volume-related technology costs.

The ratio of non-performing loans and OREO to total loans and OREO decreased 14 basis points to 0.33%. Total delinquency decreased 12 basis points to 0.63%, compared to 0.75% at June 30, 2023. Both measures continue to remain at or near historically low levels.

The provision for credit losses was $20.2 million, compared to $18.5 million in the second quarter of 2023. The second quarter of 2024 reflected net charge-offs of $7.8 million, or 0.09% annualized of total average loans, compared to $8.7 million, or 0.11% annualized. The allowance for credit losses (ACL) was $418.8 million, an increase of $6.0 million, with the ratio of the ACL to total loans and leases decreasing 8 basis points to 1.24% reflecting net loan growth and charge-off activity.

The effective tax rate was 21.6%, compared to 20.5% in the second quarter of 2023.

The CET1 regulatory capital ratio was 10.2% (estimated) at June 30, 2024, and 10.1% at June 30, 2023. Tangible book value per common share (non-GAAP) was $9.88 at June 30, 2024, an increase of $1.09, or 12.4%, from $8.79 at June 30, 2023. AOCI reduced the current quarter tangible book value per common share (non-GAAP) by $0.67, compared to a reduction of $0.99 at the end of the year-ago quarter.

________________________________
1
Second quarter 2024 non-interest expense significant items included $0.8 million (pre-tax) of additional FDIC special assessment related to the prior year's bank failures.

2 Second quarter 2023 non-interest expense significant items included $0.2 million (pre-tax) of merger expenses.

Second Quarter 2024 Results – Comparison to Prior Quarter
(All comparisons refer to the first quarter of 2024, except as noted)

Net interest income totaled $315.9 million, a decrease of $3.1 million, or 1.0%, from the prior quarter total of $319.0 million, primarily due to higher cost of funds from incremental short-term borrowings and continued balance growth in higher yielding deposit products, largely offset by higher earning assets. The total yield on earning assets (non-GAAP) increased 3 basis points to 5.43% due to higher yields on both loans and investment securities. The total cost of funds increased 13 basis points to 2.46%, as the total cost of borrowings increased 26 basis points to 5.13% and the cost of interest-bearing deposits increased 11 basis points to 2.93%. The resulting net interest margin (FTE) (non-GAAP) decreased 9 basis points to 3.09%, largely due to increased borrowings to fund the strong loan growth in the quarter.

 

Average loans and leases totaled $33.3 billion, an increase of $874.8 million, or 2.7%, as average commercial loans and leases increased $454.5 million, or 2.2%, and average consumer loans increased $420.3 million, or 3.5%. The increase in average commercial loans and leases included growth of $389.0 million, or 3.2%, in commercial real estate loans and growth of $57.5 million, or 0.8%, in commercial and industrial loans. The quarterly growth of commercial loans and leases was led by the Pittsburgh, Charlotte and Charleston markets. The increase in commercial real estate included fundings on previously originated projects. For consumer lending, average residential mortgages increased $392.5 million, driven by the seasonal growth in mortgage originations.

Average deposits totaled $34.6 billion, increasing $385.2 million, or 1.1%, due to organic growth in new and existing customer relationships. Average certificates of deposits increased $346.4 million and interest-bearing demand deposits increased $108.3 million, which were partially offset by declines in savings balances of $51.3 million, resulting from customers' preferences for higher-yielding deposit products. Period-end non-interest-bearing deposits increased $80.0 million, or 0.8%, and the mix of non-interest-bearing deposits to total deposits was 29% at both June 30, 2024 and March 31, 2024. The loan-to-deposit ratio was 96% at June 30, 2024, compared to 94%, driven by the strong seasonal loan growth.

Non-interest income totaled $87.9 million, stable with the strong prior quarter's result. Service charges increased $2.8 million, or 13.4%, primarily due to strong Treasury Management activity and seasonally higher consumer transaction levels. Capital markets income totaled $5.1 million, a decrease of $1.2 million, or 18.8%, due to lower commercial customer transaction activity. Mortgage banking operations income decreased $1.0 million, or 12.1%, driven by a slight decline in sold loan volume and net fair value adjustments from pipeline hedging activity.

Non-interest expense totaled $226.6 million, compared to $237.1 million in the prior quarter. When adjusting for significant items of $0.8 million3 in the second quarter of 2024 and $3.0 million4 in the first quarter of 2024, non-interest expense decreased $8.3 million, or 3.5%, on an operating basis (non-GAAP). Salaries and employee benefits decreased $8.2 million, primarily related to normal seasonal long-term compensation expense of $6.9 million in the first quarter of 2024, as well as seasonally higher employer-paid payroll taxes in the prior quarter. Marketing expenses decreased $1.4 million, or 26.2%, due to the timing of marketing campaigns. On an operating basis, net occupancy and equipment increased $0.8 million, or 1.9%, largely due to technology-related investments.

The ratio of non-performing loans and OREO to total loans and OREO remained stable at 0.33% and delinquency decreased 1 basis point to 0.63%. Both measures continue to remain at or near historically low levels. The provision for credit losses was $20.2 million, compared to $13.9 million, to support the strong loan growth. The second quarter of 2024 reflected net charge-offs of $7.8 million, or 0.09% annualized of total average loans, compared to $12.8 million, or 0.16% annualized. The ACL was $418.8 million, an increase of $12.5 million, with the ratio of the ACL to total loans and leases equaling 1.24% at June 30, 2024, compared to 1.25% at March 31, 2024.

The effective tax rate was 21.6%, compared to 21.5%.

The CET1 regulatory capital ratio was 10.2% (estimated), stable with March 31, 2024. Tangible book value per common share (non-GAAP) was $9.88 at June 30, 2024, an increase of $0.24 per share, or 10.0% annualized. AOCI reduced the current quarter-end tangible book value per common share (non-GAAP) by $0.67 compared to a reduction of $0.70 at the end of the prior quarter.

______________________________
3
Second quarter 2024 non-interest expense significant item included $0.8 million (pre-tax) of FDIC special assessment expense related to last year's bank failures.

4 First quarter 2024 non-interest expense significant items of $3.0 million included $1.2 million (pre-tax) of branch consolidation costs and $4.4 million (pre-tax) of FDIC special assessment expense, partially offset by a ($2.6 million) (pre-tax) reduction to the previously estimated loss on the indirect auto loan sale.

Use of Non-GAAP Financial Measures and Key Performance Indicators
To supplement our Consolidated Financial Statements presented in accordance with GAAP, we use certain non-GAAP financial measures, such as operating net income available to common stockholders, operating earnings per diluted common share, return on average tangible equity, return on average tangible common equity, operating return on average tangible common equity, return on average tangible assets, tangible book value per common share, the ratio of tangible common equity to tangible assets, pre-provision net revenue (reported), operating pre-provision net revenue, operating non-interest expense, efficiency ratio, and net interest margin (FTE) to provide information useful to investors in understanding our operating performance and trends, and to facilitate comparisons with the performance of our peers. Management uses these measures internally to assess and better understand our underlying business performance and trends related to core business activities. The non-GAAP financial measures and key performance indicators we use may differ from the non-GAAP financial measures and key performance indicators other financial institutions use to assess their performance and trends.

These non-GAAP financial measures should be viewed as supplemental in nature, and not as a substitute for, or superior to, our reported results prepared in accordance with GAAP. When non-GAAP financial measures are disclosed, the Securities and Exchange Commission's (SEC) Regulation G requires: (i) the presentation of the most directly comparable financial measure calculated and presented in accordance with GAAP and (ii) a reconciliation of the differences between the non-GAAP financial measure presented and the most directly comparable financial measure calculated and presented in accordance with GAAP. Reconciliations of non-GAAP operating measures to the most directly comparable GAAP financial measures are included later in this release under the heading "Reconciliations of Non-GAAP Financial Measures and Key Performance Indicators to GAAP."

Management believes items such as merger expenses, FDIC special assessment, loss on indirect auto loan sale, preferred deemed dividend at redemption and branch consolidation costs are not organic to run our operations and facilities. These items are considered significant items impacting earnings as they are deemed to be outside of ordinary banking activities. These costs are specific to each individual transaction and may vary significantly based on the size and complexity of the transaction.

To facilitate peer comparisons of net interest margin and efficiency ratio, we use net interest income on a taxable-equivalent basis in calculating net interest margin by increasing the interest income earned on tax-exempt assets (loans and investments) to make it fully equivalent to interest income earned on taxable investments (this adjustment is not permitted under GAAP). Taxable-equivalent amounts for 2024 and 2023 were calculated using a federal statutory income tax rate of 21%.

Cautionary Statement Regarding Forward-Looking Information
This document may contain statements regarding F.N.B. Corporation's outlook for earnings, revenues, expenses, tax rates, capital and liquidity levels and ratios, asset quality levels, financial position and other matters regarding or affecting our current or future business and operations. These statements can be considered "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve various assumptions, risks and uncertainties which can change over time. Actual results or future events may be different from those anticipated in our forward-looking statements and may not align with historical performance and events. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance upon such statements. Forward-looking statements are typically identified by words such as "believe," "plan," "expect," "anticipate," "intend," "outlook," "estimate," "forecast," "will," "should," "project," "goal," and other similar words and expressions. We do not assume any duty to update forward-looking statements, except as required by federal securities laws.

FNB's forward-looking statements are subject to the following principal risks and uncertainties:

  • Our business, financial results and balance sheet values are affected by business, economic and political circumstances, including, but not limited to: (i) developments with respect to the U.S. and global financial markets; (ii) supervision, regulation, enforcement and other actions by several governmental agencies, including the Federal Reserve Board, Federal Deposit Insurance Corporation, Financial Stability Oversight Council, U.S. Department of Justice (DOJ), Consumer Financial Protection Bureau, U.S. Treasury Department, Office of the Comptroller of the Currency and Department of Housing and Urban Development, state attorney generals and other governmental agencies, whose actions may affect, among other things, our consumer and mortgage lending and deposit practices, capital structure, investment practices, dividend policy, annual FDIC insurance premium assessment and growth, money supply, market interest rates or otherwise affect business activities of the financial services industry; (iii) a slowing of the U.S. economy in general and regional and local economies within our market area; (iv) inflation concerns; (v) the impacts of tariffs or other trade policies of the U.S. or its global trading partners; and (vi) the sociopolitical environment in the U.S.
  • Business and operating results are affected by our ability to identify and effectively manage risks inherent in our businesses, including, where appropriate, through effective use of systems and controls, third-party insurance, derivatives, and capital management techniques, and to meet evolving regulatory capital and liquidity standards.
  • Competition can have an impact on customer acquisition, growth and retention, and on credit spreads, deposit gathering and product pricing, which can affect market share, loans, deposits and revenues. Our ability to anticipate, react quickly and continue to respond to technological changes and significant adverse industry and economic events can also impact our ability to respond to customer needs and meet competitive demands.
  • Business and operating results can also be affected by difficult to predict uncertainties, such as widespread natural and other disasters, wars, pandemics, including post-pandemic return to normalcy, global events and geopolitical instability, including the Ukraine-Russia conflict and the military conflict in Israel and Gaza, shortages of labor, supply chain disruptions and shipping delays, terrorist activities, system failures, security breaches, significant political events, cyber-attacks, international hostilities or other extraordinary events which are beyond FNB's control and may significantly impact the U.S. or global economy and financial markets generally, or us or our counterparties, customers or third-party vendors specifically.
  • Legal, regulatory and accounting developments could have an impact on our ability to operate and grow our businesses, financial condition, results of operations, competitive position, and reputation. Reputational impacts could affect matters such as business generation and retention, liquidity, funding, and the ability to attract and retain talent. These developments could include:
    • Policies and priorities of the current U.S. presidential administration, including legislative and regulatory reforms, more aggressive approaches to supervisory or enforcement priorities with consumer and anti-discrimination lending laws by the federal banking regulatory agencies and the DOJ, changes affecting oversight of the financial services industry, regulatory obligations or restrictions, consumer protection, taxes, employee benefits, compensation practices, pension, bankruptcy and other industry aspects, and changes in accounting policies and principles.
    • Ability to continue to attract, develop and retain key talent.
    • Changes to regulations or accounting standards governing bank capital requirements, loan loss reserves and liquidity standards.
    • Changes in monetary and fiscal policies, including interest rate policies and strategies of the FOMC.
    • Unfavorable resolution of legal proceedings or other claims and regulatory and other governmental investigations or inquiries. These matters may result in monetary judgments or settlements, enforcement actions or other remedies, including fines, penalties, restitution or alterations in our business practices, including financial and other types of commitments, and in additional expenses and collateral costs, and may cause reputational harm to us.
    • Results of the regulatory examination and supervision process, including our failure to satisfy requirements imposed by the federal bank regulatory agencies or other governmental agencies.
    • Business and operating results are affected by our ability to effectively identify and manage risks inherent in our businesses, including, where appropriate, through effective use of policies, processes, systems and controls, third-party insurance, derivatives, and capital and liquidity management techniques.
    • The impact on our financial condition, results of operations, financial disclosures and future business strategies related to the impact on the allowance for credit losses due to changes in forecasted macroeconomic conditions as a result of applying the "current expected credit loss" accounting standard, or CECL.
    • A failure or disruption in or breach of our operational or security systems or infrastructure, or those of third parties, including as a result of cyber-attacks or campaigns.
    • Increased funding costs and market volatility due to market illiquidity and competition for funding.

FNB cautions that the risks identified here are not exhaustive of the types of risks that may adversely impact FNB and actual results may differ materially from those expressed or implied as a result of these risks and uncertainties, including, but not limited to, the risk factors and other uncertainties described under Item 1A. Risk Factors and the Risk Management sections of our 2023 Annual Report on Form 10-K (including the MD&A section), our subsequent 2024 Quarterly Reports on Form 10-Q (including the risk factors and risk management discussions) and our other 2024 filings with the SEC, which are available on our corporate website at https://www.fnb-online.com/about-us/investor-information/reports-and-filings or the SEC's website at www.sec.gov. We have included our web address as an inactive textual reference only. Information on our website is not part of our SEC filings.

Conference Call
F.N.B. Corporation (NYSE: FNB) announced the financial results for the second quarter of 2024 on Wednesday, July 17, 2024. Chairman, President and Chief Executive Officer, Vincent J. Delie, Jr., Chief Financial Officer, Vincent J. Calabrese, Jr., and Chief Credit Officer, Gary L. Guerrieri, plan to host a conference call to discuss the Company's financial results on Thursday, July 18, 2024, at 8:30 AM ET.

Participants are encouraged to pre-register for the conference call at https://dpregister.com/sreg/10190236/fce8da90f0. Callers who pre-register will be provided a conference passcode and unique PIN to bypass the live operator and gain immediate access to the call. Participants may pre-register at any time, including up to and after the call start time.

Dial-in Access: The conference call may be accessed by dialing (844) 802-2440 (for domestic callers) or (412) 317-5133 (for international callers). Participants should ask to be joined into the F.N.B. Corporation call.

Webcast Access: The audio-only call and related presentation materials may be accessed via webcast through the "About Us" tab of the Corporation's website at www.fnbcorporation.com and clicking on "Investor Relations" then "Investor Conference Calls." Access to the live webcast will begin approximately 30 minutes prior to the start of the call.

Presentation Materials: Presentation slides and the earnings release will also be available on the Corporation's website at www.fnbcorporation.com by accessing the "About Us" tab and clicking on "Investor Relations" then "Investor Conference Calls."

A replay of the call will be available shortly after the completion of the call until midnight ET on Thursday, July 25, 2024. The replay can be accessed by dialing 877-344-7529 (for domestic callers) or 412-317-0088 (for international callers); the conference replay access code is 2016205. Following the call, a link to the webcast and the related presentation materials will be posted to the "Investor Relations" section of F.N.B. Corporation's website at www.fnbcorporation.com

About F.N.B. Corporation
F.N.B. Corporation (NYSE: FNB), headquartered in Pittsburgh, Pennsylvania, is a diversified financial services company operating in seven states and the District of Columbia. FNB's market coverage spans several major metropolitan areas including: Pittsburgh, Pennsylvania; Baltimore, Maryland; Cleveland, Ohio; Washington, D.C.; Charlotte, Raleigh, Durham and the Piedmont Triad (Winston-Salem, Greensboro and High Point) in North Carolina; and Charleston, South Carolina. The Company has total assets of nearly $48 billion and approximately 350 banking offices throughout Pennsylvania, Ohio, Maryland, West Virginia, North Carolina, South Carolina, Washington, D.C. and Virginia.

FNB provides a full range of commercial banking, consumer banking and wealth management solutions through its subsidiary network which is led by its largest affiliate, First National Bank of Pennsylvania, founded in 1864. Commercial banking solutions include corporate banking, small business banking, investment real estate financing, government banking, business credit, capital markets and lease financing. The consumer banking segment provides a full line of consumer banking products and services, including deposit products, mortgage lending, consumer lending and a complete suite of mobile and online banking services. FNB's wealth management services include asset management, private banking and insurance.

The common stock of F.N.B. Corporation trades on the New York Stock Exchange under the symbol "FNB" and is included in Standard & Poor's MidCap 400 Index with the Global Industry Classification Standard (GICS) Regional Banks Sub-Industry Index. Customers, shareholders and investors can learn more about this regional financial institution by visiting the F.N.B. Corporation website at www.fnbcorporation.com

F.N.B. CORPORATION AND SUBSIDIARIES













CONSOLIDATED STATEMENTS OF INCOME











(Dollars in thousands, except per share data)













(Unaudited)







% Variance














2Q24


2Q24


For the Six Months Ended
June 30,


%


2Q24


1Q24


2Q23


1Q24


2Q23


2024


2023


Var.

Interest Income
















Loans and leases, including fees

$ 494,119


$ 481,159


$ 428,361


2.7


15.4


$     975,278


$     822,354


18.6

Securities:
















   Taxable

47,795


46,055


35,481


3.8


34.7


93,850


71,194


31.8

   Tax-exempt

7,067


7,105


7,227


(0.5)


(2.2)


14,172


14,371


(1.4)

Other

8,207


9,178


13,131


(10.6)


(37.5)


17,385


19,784


(12.1)

     Total Interest Income 

557,188


543,497


484,200


2.5


15.1


1,100,685


927,703


18.6

Interest Expense
















Deposits

179,960


170,398


111,798


5.6


61.0


350,358


195,890


78.9

Short-term borrowings

32,837


27,701


22,041


18.5


49.0


60,538


31,785


90.5

Long-term borrowings

28,501


26,390


21,117


8.0


35.0


54,891


34,130


60.8

     Total Interest Expense

241,298


224,489


154,956


7.5


55.7


465,787


261,805


77.9

       Net Interest Income

315,890


319,008


329,244


(1.0)


(4.1)


634,898


665,898


(4.7)

Provision for credit losses

20,189


13,890


18,516


45.3


9.0


34,079


32,577


4.6

      Net Interest Income After

      Provision for Credit Losses

295,701


305,118


310,728


(3.1)


(4.8)


600,819


633,321


(5.1)

Non-Interest Income
















Service charges

23,332


20,569


20,534


13.4


13.6


43,901


40,798


7.6

Interchange and card transaction fees

13,005


12,700


13,522


2.4


(3.8)


25,705


25,898


(0.7)

Trust services

11,475


11,424


10,630


0.4


7.9


22,899


21,241


7.8

Insurance commissions and fees

5,973


6,752


5,996


(11.5)


(0.4)


12,725


13,783


(7.7)

Securities commissions and fees

7,980


8,155


7,021


(2.1)


13.7


16,135


14,403


12.0

Capital markets income

5,143


6,331


5,884


(18.8)


(12.6)


11,474


12,677


(9.5)

Mortgage banking operations

6,956


7,914


4,907


(12.1)


41.8


14,870


9,762


52.3

Dividends on non-marketable equity securities

6,895


6,193


5,467


11.3


26.1


13,088


9,575


36.7

Bank owned life insurance

3,419


3,343


2,995


2.3


14.2


6,762


5,820


16.2

Net securities gains (losses)

(3)



(6)




(3)


(23)


Other

3,747


4,481


3,359


(16.4)


11.6


8,228


5,764


42.7

     Total Non-Interest Income

87,922


87,862


80,309


0.1


9.5


175,784


159,698


10.1

Non-Interest Expense
















Salaries and employee benefits

120,917


129,126


113,946


(6.4)


6.1


250,043


234,193


6.8

Net occupancy

18,632


19,595


16,689


(4.9)


11.6


38,227


34,059


12.2

Equipment

24,335


23,772


21,345


2.4


14.0


48,107


43,417


10.8

Amortization of intangibles

4,379


4,442


5,044


(1.4)


(13.2)


8,821


10,163


(13.2)

Outside services

23,250


22,880


20,539


1.6


13.2


46,130


39,937


15.5

Marketing

4,006


5,431


3,943


(26.2)


1.6


9,437


7,644


23.5

FDIC insurance

9,954


12,662


7,717


(21.4)


29.0


22,616


14,836


52.4

Bank shares and franchise taxes

3,930


4,126


3,926


(4.8)


0.1


8,056


8,098


(0.5)

Merger-related



163



(100.0)



2,215


(100.0)

Other

17,209


15,062


18,643


14.3


(7.7)


32,271


37,310


(13.5)

     Total Non-Interest Expense

226,612


237,096


211,955


(4.4)


6.9


463,708


431,872


7.4

Income Before Income Taxes

157,011


155,884


179,082


0.7


(12.3)


312,895


361,147


(13.4)

Income taxes

33,974


33,553


36,690


1.3


(7.4)


67,527


72,250


(6.5)

Net Income

123,037


122,331


142,392


0.6


(13.6)


245,368


288,897


(15.1)

Preferred stock dividends


6,005


2,010


(100.0)


(100.0)


6,005


4,020


49.4

Net Income Available to Common Stockholders

$ 123,037


$ 116,326


$ 140,382


5.8


(12.4)


$     239,363


$     284,877


(16.0)

Earnings per Common Share
















Basic

$       0.34


$       0.32


$       0.39


6.3


(12.8)


$           0.66


$           0.79


(16.5)

Diluted

0.34


0.32


0.39


6.3


(12.8)


0.66


0.78


(15.4)

Cash Dividends per Common Share

0.12


0.12


0.12




0.24


0.24


 

F.N.B. CORPORATION AND SUBSIDIARIES










CONSOLIDATED BALANCE SHEETS










(Dollars in millions)










(Unaudited)







% Variance








2Q24


2Q24


2Q24


1Q24


2Q23


1Q24


2Q23

Assets










Cash and due from banks

$          448


$          351


$          449


27.6


(0.2)

Interest-bearing deposits with banks

1,432


1,136


1,255


26.1


14.1

Cash and Cash Equivalents

1,880


1,487


1,704


26.4


10.3

Securities available for sale

3,364


3,226


3,177


4.3


5.9

Securities held to maturity

3,893


3,893


3,988



(2.4)

Loans held for sale

132


107


94


23.4


40.4

Loans and leases, net of unearned income

33,757


32,584


31,354


3.6


7.7

Allowance for credit losses on loans and leases

(419)


(406)


(413)


3.2


1.5

Net Loans and Leases

33,338


32,178


30,941


3.6


7.7

Premises and equipment, net

489


474


465


3.2


5.2

Goodwill

2,477


2,477


2,477



Core deposit and other intangible assets, net

60


65


79


(7.7)


(24.1)

Bank owned life insurance

667


663


657


0.6


1.5

Other assets

1,415


1,326


1,196


6.7


18.3

Total Assets

$    47,715


$    45,896


$    44,778


4.0


6.6

Liabilities










Deposits:










Non-interest-bearing demand

$    10,062


$      9,982


$    10,914


0.8


(7.8)

Interest-bearing demand

14,697


14,679


13,818


0.1


6.4

Savings

3,348


3,389


3,758


(1.2)


(10.9)

Certificates and other time deposits

6,887


6,685


5,335


3.0


29.1

Total Deposits

34,994


34,735


33,825


0.7


3.5

Short-term borrowings

3,616


2,074


2,391


74.3


51.2

Long-term borrowings

2,016


2,121


1,981


(5.0)


1.8

Other liabilities

999


960


763


4.1


30.9

Total Liabilities

41,625


39,890


38,960


4.3


6.8

Stockholders' Equity










Preferred stock



107



(100.0)

Common stock

4


4


4



Additional paid-in capital

4,690


4,694


4,686


(0.1)


0.1

Retained earnings

1,820


1,740


1,564


4.6


16.4

Accumulated other comprehensive loss

(243)


(250)


(355)


(2.8)


(31.5)

Treasury stock

(181)


(182)


(188)


(0.5)


(3.7)

Total Stockholders' Equity

6,090


6,006


5,818


1.4


4.7

Total Liabilities and Stockholders' Equity

$    47,715


$    45,896


$    44,778


4.0


6.6

 

F.N.B. CORPORATION AND SUBSIDIARIES


2Q24


1Q24


2Q23

(Dollars in thousands)




Interest






Interest






Interest



(Unaudited)


Average


Income/


Yield/


Average


Income/


Yield/


Average


Income/


Yield/



Balance


Expense


Rate


Balance


Expense


Rate


Balance


Expense


Rate

Assets



















Interest-bearing deposits with banks


$     868,390


$    8,207


3.80 %


$     872,353


$    9,178


4.23 %


$  1,234,026


$  13,131


4.27 %

Taxable investment securities (2)


6,154,907


47,564


3.09


6,121,568


45,825


2.99


6,084,971


35,244


2.32

Non-taxable investment securities (1)


1,033,552


8,911


3.45


1,041,224


8,971


3.45


1,059,893


9,207


3.47

Loans held for sale


110,855


2,519


9.09


237,106


4,287


7.25


102,187


1,844


7.23

Loans and leases (1) (3)


33,255,738


492,902


5.96


32,380,951


478,146


5.93


31,048,352


428,043


5.53

Total Interest Earning Assets (1)


41,423,442


560,103


5.43


40,653,202


546,407


5.40


39,529,429


487,469


4.94

Cash and due from banks


387,374






410,680






427,287





Allowance for credit losses


(414,372)






(409,865)






(410,566)





Premises and equipment


484,851






469,516






459,966





Other assets


4,590,486






4,554,056






4,404,196





Total Assets


$  46,471,781






$  45,677,589






$ 44,410,312





Liabilities



















Deposits:



















Interest-bearing demand


$  14,662,774


98,211


2.69


$  14,554,457


94,742


2.62


$ 13,922,773


63,861


1.84

Savings


3,360,593


10,136


1.21


3,411,870


9,999


1.18


3,843,785


9,117


0.95

Certificates and other time


6,645,682


71,613


4.33


6,299,280


65,657


4.19


5,003,024


38,820


3.11

Total interest-bearing deposits


24,669,049


179,960


2.93


24,265,607


170,398


2.82


22,769,582


111,798


1.97

Short-term borrowings


2,640,985


32,837


4.99


2,400,104


27,701


4.63


2,340,603


22,041


3.77

Long-term borrowings


2,164,983


28,501


5.29


2,057,817


26,390


5.16


1,703,667


21,117


4.97

Total Interest-Bearing Liabilities  


29,475,017


241,298


3.29


28,723,528


224,489


3.14


26,813,852


154,956


2.32

Non-interest-bearing demand deposits


9,921,073






9,939,350






11,006,705





Total Deposits and Borrowings


39,396,090




2.46


38,662,878




2.33


37,820,557




1.64

Other liabilities


1,037,452






975,138






756,569





Total Liabilities


40,433,542






39,638,016






38,577,126





Stockholders' Equity


6,038,239






6,039,573






5,833,186





Total Liabilities and Stockholders' Equity


$  46,471,781






$  45,677,589






$ 44,410,312





Net Interest Earning Assets


$  11,948,425






$  11,929,674






$ 12,715,577





Net Interest Income (FTE) (1)




318,805






321,918






332,513



Tax Equivalent Adjustment




(2,915)






(2,910)






(3,269)



Net Interest Income




$  315,890






$  319,008






$  329,244



Net Interest Spread






2.14 %






2.26 %






2.62 %

Net Interest Margin  (1)






3.09 %






3.18 %






3.37 %



(1)

The net interest margin and yield on earning assets (all non-GAAP measures) are presented on a fully taxable equivalent (FTE) basis, which adjusts for the tax benefit of income on certain tax-exempt loans and investments using the federal statutory tax rate of 21%

(2)

The average balances and yields earned on taxable investment securities are based on historical cost.

(3)

Average balances for loans include non-accrual loans.  Loans and leases consist of average total loans and leases less average unearned income. 

 

F.N.B. CORPORATION AND SUBSIDIARIES


Six Months Ended June 30,

(Dollars in thousands)


2024


2023

(Unaudited)




Interest






Interest





Average


Income/


Yield/


Average


Income/


Yield/



Balance


Expense


Rate


Balance


Expense


Rate

Assets













Interest-bearing deposits with banks


$     870,372


$      17,385


4.02 %


$  1,027,117


$      19,784


3.88 %

Taxable investment securities (2)


6,138,237


93,388


3.04


6,149,284


70,719


2.30

Non-taxable investment securities (1)


1,037,388


17,883


3.45


1,057,554


18,366


3.47

Loans held for sale


173,981


6,805


7.84


109,137


3,438


6.32

Loans and leases (1) (3)


32,818,345


971,049


5.94


30,731,126


821,939


5.39

Total Interest Earning Assets (1)


41,038,323


1,106,510


5.41


39,074,218


934,246


4.81

Cash and due from banks


399,027






434,956





Allowance for credit losses


(412,119)






(408,149)





Premises and equipment


477,183






451,252





Other assets


4,572,271






4,366,564





Total Assets


$  46,074,685






$  43,918,841





Liabilities













Deposits:













Interest-bearing demand


$  14,608,616


192,953


2.66


$  14,258,082


116,151


1.64

Savings


3,386,231


20,135


1.20


3,932,627


16,958


0.87

Certificates and other time


6,472,481


137,270


4.26


4,595,128


62,781


2.76

Total interest-bearing deposits


24,467,328


350,358


2.88


22,785,837


195,890


1.73

Short-term borrowings


2,520,544


60,538


4.82


1,953,125


31,785


3.28

Long-term borrowings


2,111,400


54,891


5.23


1,394,571


34,130


4.94

Total Interest-Bearing Liabilities  


29,099,272


465,787


3.22


26,133,533


261,805


2.02

Non-interest-bearing demand deposits


9,930,212






11,207,490





Total Deposits and Borrowings


39,029,484




2.40


37,341,023




1.41

Other liabilities


1,006,295






795,124





Total Liabilities


40,035,779






38,136,147





Stockholders' Equity


6,038,906






5,782,694





Total Liabilities and Stockholders' Equity


$  46,074,685






$  43,918,841





Net Interest Earning Assets


$  11,939,051






$  12,940,685





Net Interest Income (FTE) (1)




640,723






672,441



Tax Equivalent Adjustment




(5,825)






(6,543)



Net Interest Income




$    634,898






$   665,898



Net Interest Spread






2.19 %






2.79 %

Net Interest Margin (1)






3.13 %






3.46 %



(1)

The net interest margin and yield on earning assets (all non-GAAP measures) are presented on a fully taxable equivalent (FTE) basis, which adjusts for the tax benefit of income on certain tax-exempt loans and investments using the federal statutory tax rate of 21%

(2)

The average balances and yields earned on taxable investment securities are based on historical cost.

(3)

Average balances for loans include non-accrual loans.  Loans and leases consist of average total loans and leases less average unearned income. 

 

F.N.B. CORPORATION AND SUBSIDIARIES









(Unaudited)



























For the Six Months Ended
June 30,


2Q24


1Q24


2Q23


2024


2023

Performance Ratios










Return on average equity

8.20 %


8.15 %


9.79 %


8.17 %


10.07 %

Return on average tangible equity (1) 

14.54


14.48


17.93


14.51


18.59

Return on average tangible

common equity (1) 

14.54


14.00


18.28


14.27


18.96

Return on average assets

1.06


1.08


1.29


1.07


1.33

Return on average tangible assets (1) 

1.16


1.17


1.40


1.17


1.45

Net interest margin (FTE) (2)

3.09


3.18


3.37


3.13


3.46

Yield on earning assets (FTE) (2)

5.43


5.40


4.94


5.41


4.81

Cost of interest-bearing deposits

2.93


2.82


1.97


2.88


1.73

Cost of interest-bearing liabilities 

3.29


3.14


2.32


3.22


2.02

Cost of funds 

2.46


2.33


1.64


2.40


1.41

Efficiency ratio (1)

54.39


56.00


49.96


55.20


50.28

Effective tax rate

21.64


21.52


20.49


21.58


20.01

Capital Ratios










Equity / assets (period end)

12.76


13.09


12.99





Common equity / assets (period end)

12.76


13.09


12.75





Common equity tier 1 (3)

10.2


10.2


10.1





Leverage ratio

8.63


8.62


8.68





Tangible common equity / tangible assets (period end) (1)

7.86


7.99


7.47





Common Stock Data










Average diluted common shares outstanding

362,701,233


362,619,278


362,626,182


362,660,259


363,776,559

Period end common shares outstanding

359,558,026


359,366,316


358,820,568





Book value per common share

$          16.94


$          16.71


$          15.92





Tangible book value per common share (1)

9.88


9.64


8.79





Dividend payout ratio (common)

35.42 %


37.76 %


30.88 %


36.56 %


30.59 %



(1)

See non-GAAP financial measures section of this Press Release for additional information relating to the calculation of this item.

(2)

The net interest margin and yield on earning assets (all non-GAAP measures) are presented on a fully taxable equivalent (FTE) basis, which adjusts for the tax benefit of income on certain tax-exempt loans and investments using the federal statutory tax rate of 21%

(3)

June 30, 2024 Common Equity Tier 1 ratio is an estimate and reflects the election of a five-year transition to delay the full impact of CECL on regulatory capital for two years, followed by a three-year transition period.

 

F.N.B. CORPORATION AND SUBSIDIARIES













(Dollars in millions)
















(Unaudited)























% Variance














2Q24


2Q24








2Q24


1Q24


2Q23


1Q24


2Q23







Balances at period end
















Loans and Leases:
















Commercial real estate (1)

$   12,664


$    12,447


$    11,689


1.7


8.3







Commercial and industrial 

7,597


7,347


7,248


3.4


4.8







Commercial leases

683


615


618


11.1


10.5







Other

145


140


121


3.6


19.8







Commercial loans and leases

21,089


20,549


19,676


2.6


7.2







Direct installment

2,700


2,712


2,747


(0.4)


(1.7)







Residential mortgages

7,459


6,887


6,089


8.3


22.5







Indirect installment

1,188


1,142


1,539


4.0


(22.8)







Consumer LOC

1,321


1,294


1,303


2.1


1.4







Consumer loans

12,668


12,035


11,678


5.3


8.5







Total loans and leases

$   33,757


$    32,584


$    31,354


3.6


7.7







Note: Loans held for sale were $132, $107 and $94 at 2Q24, 1Q24, and 2Q23, respectively.







(1) Commercial real estate is made up of 71% non-owner occupied and 29% owner-occupied at June 30, 2024.












% Variance







Average balances







2Q24


2Q24


For the Six Months Ended
June 30,


%

Loans and Leases:

2Q24


1Q24


2Q23


1Q24


2Q23


2024


2023


Var.

Commercial real estate 

$   12,663


$    12,274


$    11,693


3.2


8.3


$        12,437


$        11,616


7.1

Commercial and industrial

7,472


7,414


7,247


0.8


3.1


7,475


7,208


3.7

Commercial leases

659


658


591


0.1


11.6


659


562


17.1

Other

142


135


142


5.4


0.1


139


137


1.5

Commercial loans and leases

20,936


20,482


19,672


2.2


6.4


20,709


19,523


6.1

Direct installment

2,704


2,727


2,742


(0.8)


(1.4)


2,715


2,752


(1.3)

Residential mortgages

7,137


6,745


5,805


5.8


22.9


6,941


5,615


23.6

Indirect installment

1,168


1,138


1,531


2.7


(23.7)


1,153


1,536


(24.9)

Consumer LOC

1,310


1,290


1,297


1.6


1.0


1,300


1,304


(0.4)

Consumer loans

12,320


11,899


11,376


3.5


8.3


12,110


11,208


8.0

Total loans and leases

$   33,256


$    32,381


$    31,048


2.7


7.1


$        32,818


$        30,731


6.8

 

F.N.B. CORPORATION AND SUBSIDIARIES










(Dollars in millions)







% Variance

(Unaudited)







2Q24


2Q24

Asset Quality Data

2Q24


1Q24


2Q23


1Q24


2Q23

Non-Performing Assets










Non-performing loans

$    108


$    105


$    143


2.9


(24.5)

Other real estate owned (OREO)

3


3


5



(40.0)

Non-performing assets

$    111


$    108


$    148


2.8


(25.0)

Non-performing loans / total loans and leases

0.32 %


0.32 %


0.45 %





Non-performing assets plus 90+ days past due / total loans and leases
plus OREO

0.36


0.38


0.50





Delinquency










Loans 30-89 days past due

$       95


$       87


$       83


9.2


14.5

Loans 90+ days past due

11


17


8


(35.3)


37.5

Non-accrual loans

108


105


143


2.9


(24.5)

Past due and non-accrual loans

$    214


$    209


$    234


2.4


(8.5)

Past due and non-accrual loans / total loans and leases

0.63 %


0.64 %


0.75 %





 

F.N.B. CORPORATION AND SUBSIDIARIES
















(Dollars in millions)







% Variance







(Unaudited)







2Q24


2Q24


For the Six Months Ended
June 30,


%

Allowance on Loans and Leases and Allowance for
Unfunded Loan Commitments Rollforward

2Q24


1Q24


2Q23


1Q24


2Q23


2024


2023


Var.

Allowance for Credit Losses on Loans and Leases
















Balance at beginning of period

$  406.3


$  405.6


$  403.4


0.2


0.7


$        405.6


$       401.7


1.0

Provision for credit losses 

20.3


13.5


18.0


50.4


12.7


33.8


32.9


2.7

Net loan (charge-offs)/recoveries

(7.8)


(12.8)


(8.7)


(38.6)


(9.8)


(20.6)


(21.9)


(5.8)

Allowance for credit losses on loans and leases

$  418.8


$  406.3


$  412.7


3.1


1.5


$        418.8


$       412.7


1.5

Allowance for Unfunded Loan Commitments
















Allowance for unfunded loan commitments balance at beginning
of period

$    21.9


$    21.5


$    20.5


1.8


6.9


$          21.5


$         21.4


0.5

Provision (reduction in allowance) for unfunded loan
commitments / other adjustments

(0.1)


0.4


0.5


(130.7)


(124.3)


0.3


(0.4)


161.8

Allowance for unfunded loan commitments

$    21.8


$    21.9


$    21.0


(0.5)


3.8


$          21.8


$         21.0


3.8

Total allowance for credit losses on loans and
leases and allowance for unfunded loan commitments

$  440.5


$  428.2


$  433.7


2.9


1.6


$        440.5


$       433.7


1.6

Allowance for credit losses on loans and leases / total loans and
leases

1.24 %


1.25 %


1.32 %











Allowance for credit losses on loans and leases / total non-
performing loans

388.1


388.6


289.5











Net loan charge-offs (annualized) / total average loans and
leases

0.09


0.16


0.11






0.13 %


0.14 %



 

F.N.B. CORPORATION AND SUBSIDIARIES















(Unaudited)
































RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES AND KEY PERFORMANCE INDICATORS TO GAAP

We believe the following non-GAAP financial measures provide information useful to investors in understanding our operating performance and trends, and facilitate comparisons with the performance of our peers. The non-GAAP financial measures we use may differ from the non-GAAP financial measures other financial institutions use to measure their results of operations.  Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, our reported results prepared in accordance with U.S. GAAP. The following tables summarize the non-GAAP financial measures included in this press release and derived from amounts reported in our financial statements.








% Variance














2Q24


2Q24


For the Six Months Ended
June 30,


%


2Q24


1Q24


2Q23


1Q24


2Q23


2024


2023


Var.

Operating net income available to common stockholders:
















(Dollars in thousands)
















Net income available to common stockholders

$  123,037


$  116,326


$  140,382






$  239,363


$ 284,877



Preferred dividend at redemption


3,995







3,995




Merger-related expense



163







2,215



Tax benefit of merger-related expense



(34)







(465)



Branch consolidation costs


1,194







1,194




Tax benefit of branch consolidation costs


(251)







(251)




FDIC special assessment

804


4,408







5,212




Tax benefit of FDIC special assessment

(169)


(926)







(1,095)




Loss on indirect auto loan sale


(2,603)







(2,603)




Tax expense (benefit) of loss on indirect auto loan sale


547







547




Operating net income available to common stockholders (non-GAAP)

$  123,672


$  122,690


$  140,511


0.8


(12.0)


$  246,362


$ 286,627


(14.0)

















Operating earnings per diluted common share:
















Earnings per diluted common share

$       0.34


$       0.32


$       0.39






$        0.66


$        0.78



Preferred dividend at redemption


0.01







0.01




Merger-related expense









0.01



Tax benefit of merger-related expense











Branch consolidation costs











Tax benefit of branch consolidation costs











FDIC special assessment


0.01







0.01




Tax benefit of FDIC special assessment











Loss on indirect auto loan sale


(0.01)







(0.01)




Tax expense (benefit) of loss on indirect auto loan sale











Operating earnings per diluted common share (non-GAAP)

$       0.34


$       0.34


$       0.39



(12.8)


$        0.68


$        0.79


(13.9)

 

F.N.B. CORPORATION AND SUBSIDIARIES





(Unaudited)

















For the Six Months Ended
June 30,


2Q24


1Q24


2Q23


2024


2023

Return on average tangible equity:










(Dollars in thousands)










Net income (annualized)

$     494,851


$     492,012


$     571,131


$      493,431


$     582,582

Amortization of intangibles, net of
tax (annualized)

13,913


14,115


15,984


14,014


16,190

Tangible net income (annualized)
(non-GAAP)

$     508,764


$     506,127


$     587,115


$      507,445


$     598,772











Average total stockholders' equity

$  6,038,239


$  6,039,573


$  5,833,186


$   6,038,906


$  5,782,694

Less: Average intangible assets (1)

(2,539,710)


(2,544,032)


(2,558,631)


(2,541,871)


(2,561,087)

Average tangible stockholders'
equity (non-GAAP)

$  3,498,529


$  3,495,541


$  3,274,555


$   3,497,035


$  3,221,607











Return on average tangible equity
(non-GAAP)

14.54 %


14.48 %


17.93 %


14.51 %


18.59 %

Return on average tangible
common equity:










(Dollars in thousands)










Net income available to common
stockholders (annualized)

$     494,851


$     467,859


$     563,073


$      481,357


$     574,476

Amortization of intangibles, net of
tax (annualized)

13,913


14,115


15,984


14,014


16,190

Tangible net income available to
common stockholders (annualized)
(non-GAAP)

$     508,764


$     481,974


$     579,057


$      495,371


$     590,666











Average total stockholders' equity

$  6,038,239


$  6,039,573


$  5,833,186


$   6,038,906


$  5,782,694

Less:  Average preferred
stockholders' equity


(52,854)


(106,882)


(26,427)


(106,882)

Less: Average intangible assets (1)

(2,539,710)


(2,544,032)


(2,558,631)


(2,541,871)


(2,561,087)

Average tangible common equity
(non-GAAP)

$  3,498,529


$  3,442,687


$  3,167,673


$   3,470,608


$  3,114,725











Return on average tangible
common equity (non-GAAP)

14.54 %


14.00 %


18.28 %


14.27 %


18.96 %

(1) Excludes loan servicing rights.










Operating return on average
tangible common equity:










(Dollars in thousands)










Operating net income available to
common stockholders (annualized)

$     497,406


$     493,456


$     563,588


$      495,431


$     578,005

Amortization of intangibles, net of
tax (annualized)

13,913


14,115


15,984


14,014


16,190

Tangible operating net income
available to common stockholders
(annualized) (non-GAAP)

$     511,319


$     507,571


$     579,572


$      509,445


$     594,195











Average total stockholders' equity

$  6,038,239


$  6,039,573


$  5,833,186


$   6,038,906


$  5,782,694

Less:  Average preferred
stockholders' equity


(52,854)


(106,882)


(26,427)


(106,882)

Less: Average intangible assets (1)

(2,539,710)


(2,544,032)


(2,558,631)


(2,541,871)


(2,561,087)

Average tangible common equity
(non-GAAP)

$  3,498,529


$  3,442,687


$  3,167,673


$   3,470,608


$  3,114,725











Operating return on average
tangible common equity (non-
GAAP)

14.62 %


14.74 %


18.30 %


14.68 %


19.08 %











Return on average tangible assets:










(Dollars in thousands)










Net income (annualized)

$     494,851


$     492,012


$     571,131


$      493,431


$     582,582

Amortization of intangibles, net of
tax (annualized)

13,913


14,115


15,984


14,014


16,190

Tangible net income (annualized)
(non-GAAP)

$     508,764


$     506,127


$     587,115


$      507,445


$     598,772











Average total assets

$  46,471,781


$  45,677,589


$  44,410,312


$ 46,074,685


$  43,918,841

Less: Average intangible assets (1)

(2,539,710)


(2,544,032)


(2,558,631)


(2,541,871)


(2,561,087)

Average tangible assets (non-
GAAP)

$  43,932,071


$  43,133,557


$  41,851,681


$ 43,532,814


$  41,357,754











Return on average tangible assets
(non-GAAP)

1.16 %


1.17 %


1.40 %


1.17 %


1.45 %

(1) Excludes loan servicing rights.










 

F.N.B. CORPORATION AND SUBSIDIARIES

(Unaudited)







2Q24


1Q24


2Q23

Tangible book value per common share:






(Dollars in thousands, except per share data)






Total stockholders' equity

$     6,089,634


$     6,005,562


$     5,817,749

Less:  Preferred stockholders' equity



(106,882)

Less:  Intangible assets (1)

(2,537,532)


(2,541,911)


(2,556,307)

Tangible common equity (non-GAAP)

$     3,552,102


$     3,463,651


$     3,154,560







Common shares outstanding

359,558,026


359,366,316


358,820,568







Tangible book value per common share (non-GAAP)

$              9.88


$              9.64


$              8.79

Tangible common equity to tangible assets:






(Dollars in thousands)






Total stockholders' equity

$     6,089,634


$     6,005,562


$     5,817,749

Less:  Preferred stockholders' equity



(106,882)

Less:  Intangible assets (1)

(2,537,532)


(2,541,911)


(2,556,307)

Tangible common equity (non-GAAP)

$     3,552,102


$     3,463,651


$     3,154,560







Total assets

$   47,714,742


$   45,895,574


$   44,777,964

Less:  Intangible assets (1)

(2,537,532)


(2,541,911)


(2,556,307)

Tangible assets (non-GAAP)

$   45,177,210


$   43,353,663


$   42,221,657







Tangible common equity to tangible assets (non-GAAP)

7.86 %


7.99 %


7.47 %

(1) Excludes loan servicing rights.






 

Operating non-interest expense






(dollars in thousands)






Non-interest expense

$           226,612


$           237,096


$           211,955

Branch consolidations


(1,194)


Merger-related



(163)

FDIC special assessment

(804)


(4,408)


Loss on indirect auto loan sale


2,603


Operating non-interest expense (non-GAAP)

$           225,808


$           234,097


$           211,792

 

F.N.B. CORPORATION AND SUBSIDIARIES









(Unaudited)

















For the Six Months Ended
June 30,


2Q24


1Q24


2Q23


2024


2023

KEY PERFORMANCE INDICATORS










Pre-provision net revenue:










(Dollars in thousands)










Net interest income

$   315,890


$   319,008


$   329,244


$   634,898


$   665,898

Non-interest income

87,922


87,862


80,309


175,784


159,698

Less: Non-interest expense

(226,612)


(237,096)


(211,955)


(463,708)


(431,872)

Pre-provision net revenue (reported) (non-
GAAP)

$   177,200


$   169,774


$   197,598


$   346,974


$   393,724

Pre-provision net revenue (reported)
(annualized) (non-GAAP)

$   712,695


$   682,825


$   792,559


$   697,760


$   793,973

Adjustments:










Add: Merger-related expense (non-interest
expense)



163



2,215

Add: Branch consolidation costs (non-
interest expense)


1,194



1,194


Add: FDIC special assessment (non-interest
expense)

804


4,408



5,212


(Less) / Add: Loss on indirect auto loan sale
(non-interest expense)


(2,603)



(2,603)


Operating pre-provision net revenue (non-
GAAP)

$   178,004


$   172,773


$   197,761


$   350,777


$   395,939

Operating pre-provision net revenue
(annualized) (non-GAAP)

$   715,928


$   694,887


$   793,213


$   705,408


$   798,440











Efficiency ratio (FTE):










(Dollars in thousands)










Total non-interest expense

$   226,612


$   237,096


$   211,955


$   463,708


$   431,872

Less: Amortization of intangibles

(4,379)


(4,442)


(5,044)


(8,821)


(10,163)

Less: OREO expense

(200)


(190)


(492)


(390)


(1,049)

Less: Merger-related expense



(163)



(2,215)

Less: Branch consolidation costs


(1,194)



(1,194)


Less: FDIC special assessment

(804)


(4,408)



(5,212)


Add / (Less): Loss on indirect auto loan sale


2,603



2,603


Adjusted non-interest expense

$   221,229


$   229,465


$   206,256


$   450,694


$   418,445











Net interest income

$   315,890


$   319,008


$   329,244


$   634,898


$   665,898

Taxable equivalent adjustment

2,915


2,910


3,269


5,825


6,543

Non-interest income

87,922


87,862


80,309


175,784


159,698

Less:  Net securities losses (gains)

3



6


3


23

Adjusted net interest income (FTE) + non-
interest income

$   406,730


$   409,780


$   412,828


$   816,510


$   832,162











Efficiency ratio (FTE) (non-GAAP)

54.39 %


56.00 %


49.96 %


55.20 %


50.28 %

 

(PRNewsfoto/F.N.B. Corporation)

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/fnb-corporation-reports-second-quarter-2024-earnings-302199834.html

SOURCE F.N.B. Corporation

FAQ

What were FNB's earnings for Q2 2024?

FNB reported earnings for Q2 2024 with net income of $123.0 million, or $0.34 per diluted share.

How did FNB's net income for Q2 2024 compare to Q2 2023?

Net income for Q2 2024 was $123.0 million, down from $140.4 million in Q2 2023.

What was the loan and deposit growth for FNB in Q2 2024?

Loans grew by 3.6% and deposits by 0.7% in Q2 2024.

How did FNB's tangible book value per share change in Q2 2024?

Tangible book value per share increased 12% YoY to $9.88.

What is FNB's CET1 ratio as of Q2 2024?

FNB's CET1 ratio was 10.2% in Q2 2024.

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