• Net Income: $116.5 million or $0.32 per share.
• Tangible Book Value Per Share: Increased by 12% to $10.83.
• CET1 Ratio: 10.7%.
• Tangible Common Equity to Tangible Assets: 8.4%.
• Total Revenue: $411.2 million.
• Noninterest Income: $87.8 million.
• Annualized Loan Growth: 3.5%.
• Annualized Deposit Growth: 1.4%.
• Total Loans and Leases: $34.2 billion.
• Total Deposits: $37.2 billion.
• Net Interest Margin: 3.03%.
• Net Interest Income: Nearly $324 million.
• Noninterest Expense: $246.8 million.
• Efficiency Ratio: 58.5%.
• Provision Expense: $18.6 million.
• Ending Funded Reserve: $429 million, 1.25% of total loans.
• NPL Coverage: 267%.
• Delinquency Rate: 75 basis points.
• Net Charge-Offs: 15 basis points.

• Warning! GuruFocus has detected 4 Warning Signs with FNB.

Release Date: April 17, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• F N B Corp (NYSE:FNB) reported a net income of $116.5 million or $0.32 per share, indicating strong financial performance.
• The company achieved a 12% growth in tangible book value per share, reaching $10.83.
• FNB maintained record capital levels with a CET1 ratio of 10.7% and tangible common equity to tangible assets of 8.4%.
• The company demonstrated modest revenue growth, with total revenue reaching $411.2 million, driven by net interest income and solid noninterest income.
• FNB's strategic investments in high-value business units and digital banking enhancements, such as automated direct deposit switch capabilities, are expected to drive client acquisition and engagement.

Negative Points

• The macroeconomic environment remains uncertain, with potential impacts from tariffs and economic volatility posing risks to FNB's operations.
• Loan growth was modest, with annualized growth rates of 3.5% for loans and 1.4% for deposits, reflecting a slower pace in a seasonally weaker period.
• The company's capital markets income was impacted by lower commercial customer activity due to the current economic environment.
• FNB's noninterest expense increased due to higher salaries and employee benefits, driven by seasonal compensation expenses and strategic hiring.
• The company faces potential risks from tariffs, with less than 5% of its C&I and owner-occupied loan portfolio identified as at risk of greater impact.

Q & A Highlights

Q: Can you provide an overview of the net interest income (NII) outlook and the impact of swap maturities on NII this quarter? A: Vincent Calabrese, Chief Financial Officer, explained that the NII guidance remains consistent with expectations of rate cuts in June and September. The swap maturities had an $8 million drag in the first quarter, expected to decrease to $6 million in the second quarter, and further reduce in subsequent quarters. The second quarter NII is projected to be in the upper half of the guidance range, with potential upside in both NII and noninterest income.

Q: What are the expectations for loan growth, and how might tariffs impact this? A: Vincent Delie, CEO, noted that while pipelines are softer year-over-year, there is optimism for demand to pick up in the second half of the year. The company has assessed the impact of tariffs, finding less than 5% of exposures at risk. The diverse geographic footprint and focus on manufacturing provide resilience, and the company remains confident in achieving mid-single-digit loan growth.

Q: How is FNB managing expenses, and what initiatives are in place to improve operating leverage? A: Vincent Calabrese highlighted a history of disciplined expense management, targeting $15 million to $20 million in cost savings through renegotiated contracts, space optimization, and leveraging AI and machine learning. The company expects improved performance with positive operating leverage in the second half of 2025.

Q: Can you elaborate on the potential impact of tariffs on credit risk and reserves? A: Gary Guerrieri, Chief Credit Officer, stated that proactive measures have been taken to assess tariff impacts, with less than 5% of the C&I portfolio at higher risk. Frequent communication with clients and monitoring of financial performance are ongoing. Stress tests indicate manageable reserve levels even in a recessionary scenario.

Q: What are the strategic benefits of the Raptor Partners acquisition, and how does it fit into FNB's broader M&A strategy? A: Vincent Delie explained that the acquisition of Raptor Partners enhances FNB's capabilities in investment banking, particularly in the middle market. The acquisition aligns with FNB's strategy to support businesses throughout their lifecycle and diversify noninterest income. The company remains open to further M&A opportunities that align with its strategic goals and provide significant cost savings and earnings accretion.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.