F.N.B. Corporation Reports First Quarter Earnings

F.N.B. Corporation Reports First Quarter Earnings
Record CET1 Ratio of 10.7% with Strong Tangible Book Value per Share (non-GAAP) Growth of 12.3% and Net Interest Income Growth of 1.5%

F.N.B. Corporation (NYSE: FNB) reported earnings for the first quarter of 2025 with net income available to common shareholders of $116.5 million, or $0.32 per diluted common share. Comparatively, first quarter of 2024 net income available to common shareholders totaled $116.3 million, or $0.32 per diluted common share, and fourth quarter of 2024 net income available to common shareholders totaled $109.9 million, or $0.30 per diluted common share.

On an operating basis, first quarter of 2025 earnings per diluted common share (non-GAAP) was $0.32, with no significant items impacting earnings. By comparison, the first quarter of 2024 was $0.34 per diluted common share (non-GAAP) on an operating basis, excluding $0.02 per diluted common share of significant items impacting earnings, and the fourth quarter of 2024 was $0.38 per diluted common share (non-GAAP) on an operating basis, excluding $0.08 per diluted common share of significant items impacting earnings.

“F.N.B. Corporation’s first quarter earnings per diluted common share totaled $0.32 with positive momentum on several key metrics, including tangible book value per share growth (non-GAAP) of 12.3% to $10.83, record CET1 regulatory capital ratio at 10.7% and tangible common equity to tangible assets (non-GAAP) at 8.4%,” said F.N.B. Corporation Chairman, President and Chief Executive Officer, Vincent J. Delie, Jr. “During the first quarter, we generated sequential and year-over-year revenue growth with net interest income expansion and solid non-interest income which benefited from the continuous strategic investments made to develop and expand high-value advisory businesses. The first quarter’s annualized loan and deposit growth of 3.5% and 1.4%, respectively, in a seasonally slower quarter, demonstrates our successful focus on leveraging our technology and digital banking platform to enhance the customer experience and drive primacy. Our comprehensive and conservative approach to credit risk management has led to strong and stable asset quality with net-charge-offs at a solid 0.15%. FNB remains prepared for a broad range of economic scenarios given our diversified and granular deposit base, consistent and conservative underwriting, solid capital and liquidity levels and sound risk management policies and governance.”

First Quarter 2025 Highlights
(All comparisons refer to the first quarter of 2024, except as noted)

• Period-end total loans and leases increased $1.7 billion, or 5.1%. Consumer loans increased $964.6 million, or 8.0%, net of a $431 million indirect auto loan sale that closed in the third quarter of 2024, and commercial loans and leases increased $686.6 million, or 3.3%. 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 $296.4 million, or 3.5% annualized, with an increase of $224.3 million in consumer loans and $72.1 million in commercial loans and leases.
• Period-end total deposits increased $2.5 billion, or 7.2%, driven by an increase of $2.2 billion in interest-bearing demand deposits and $0.6 billion in shorter-term time deposits, offsetting the decline of $0.2 billion in savings deposits and $0.1 billion in non-interest-bearing demand deposits, as customers continued to opt for higher-yielding deposit products.
• On a linked-quarter basis, period-end total deposits increased $131.7 million, or 1.4% annualized, with increases in interest-bearing demand deposits of $251.9 million and non-interest-bearing demand deposits of $105.8 million in a seasonally slow quarter, more than offsetting the decline in time deposits of $194.8 million. The ratio of non-interest-bearing demand deposits to total deposits was stable at 26% at March 31, 2025 compared to the prior quarter end.
• The loan-to-deposit ratio was 92% at March 31, 2025, compared to 91% at December 31, 2024, and 94% at March 31, 2024.
• Net interest income totaled $323.8 million, an increase of $1.6 million, or 0.5%, from the prior quarter, primarily due to lower cost of funds more than offsetting the impact of lower yields on earning assets (non-GAAP) and two less days in the current quarter. The Federal Open Market Committee (FOMC) lowered the target federal funds rate by 100 basis points in the latter half of 2024.
• Net interest margin (FTE) (non-GAAP) equaled 3.03%, stable with the prior quarter, reflecting a 10 basis point decline in the total cost of funds and an 11 basis point decline in the total yield on earning assets (non-GAAP).
• Provision for credit losses was $17.5 million, a decrease of $4.8 million from the prior quarter with net charge-offs of $12.5 million, or 0.15% annualized of total average loans, compared to $20.6 million, or 0.24% annualized, in the prior quarter. The ratio of non-performing loans and other real estate owned (OREO) to total loans and leases and OREO was consistent with the prior quarter at 0.48%, and total delinquency decreased 8 basis points from the prior quarter to 0.75%. Overall, asset quality metrics continue to remain at solid levels.
• Record capital levels with the CET1 regulatory capital ratio at 10.7% (estimated), compared to 10.2% at March 31, 2024, and 10.6% at December 31, 2024. The tangible common equity to tangible asset ratio (non-GAAP) equaled 8.4%, compared to 8.0% at March 31, 2024, and 8.2% at December 31, 2024.
• Tangible book value per common share (non-GAAP) of $10.83 increased $1.19, or 12.3%, compared to March 31, 2024, and $0.34, or 3.2%, compared to December 31, 2024. Accumulated other comprehensive income/loss (AOCI) reduced the tangible book value per common share (non-GAAP) by $0.34 as of March 31, 2025, primarily due to the impact of quarter-end interest rates on the fair value of AFS securities, compared to a reduction of $0.70 as of March 31, 2024, and $0.47 as of December 31, 2024.
• During the first quarter of 2025, the Company repurchased 0.7 million shares of common stock at a weighted average share price of $13.48 while maintaining capital 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.}

First Quarter 2025 Results – Comparison to Prior-Year Quarter
(All comparisons refer to the first quarter of 2024, except as noted)

Net interest income totaled $323.8 million, an increase of $4.8 million, or 1.5%, reflecting growth in earning assets partially offset by higher deposit costs resulting from balance growth in higher yielding deposit products.

The net interest margin (FTE) (non-GAAP) decreased 15 basis points to 3.03%. The yield on earning assets (non-GAAP) decreased 17 basis points to 5.23% driven by a 25 basis point decline in yields on loans to 5.68%, offset by a 33 basis point increase in yields on investment securities to 3.51%. Total cost of funds decreased 1 basis point to 2.32%, with a decrease of 8 basis points in total borrowing costs and a 6 basis point decrease in interest-bearing deposit costs to 2.76%.

Average loans and leases totaled $34.1 billion, an increase of $1.7 billion, or 5.2%, including growth of $943.9 million in consumer loans and $725.9 million in commercial loans and leases. Commercial real estate increased $430.7 million, or 3.5%, commercial and industrial loans increased $174.6 million, or 2.4%, and commercial leases increased $107.5 million, or 16.3%. The increase in average commercial loans and leases was driven by activity across the footprint, including the South Carolina and eastern North Carolina markets with strong contributions from our commercial leasing team. The increase in commercial real estate included fundings on previously originated construction 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 and long-standing strategy of serving the purchase market. Average indirect auto loans decreased $378.7 million, due to a sale of $431 million that closed in the third quarter of 2024, partially offset by new organic growth in the portfolio.

Average deposits totaled $37.0 billion, an increase of $2.8 billion, or 8.1%. The growth in average interest-bearing demand deposits of $2.3 billion and average time deposits of $924.6 million more than offset the decline in average non-interest-bearing demand deposits of $291.4 million and average savings deposits of $215.5 million as customers continued to migrate balances into higher-yielding products. The funding mix has slightly shifted compared to the year-ago quarter with non-interest-bearing demand deposits comprising 26% of total deposits at March 31, 2025, compared to 29% a year ago. The loan-to-deposit ratio was 92% at March 31, 2025, compared to 94% at March 31, 2024.

Non-interest income totaled $87.8 million, compared to $87.9 million. Service charges increased $1.8 million, or 8.7%, primarily due to strong Treasury Management activity and higher consumer transaction volumes. Wealth Management revenues increased $1.6 million, or 8.4%, to a record $21.2 million as trust income and securities commissions and fees increased 8.5% and 8.2%, respectively, through continued strong contributions across the geographic footprint. Bank-owned life insurance increased $2.0 million due to elevated life insurance claims.

Non-interest expense totaled $246.8 million, increasing $9.7 million, or 4.1%. When adjusting for $3.0 million^[1] of significant items in the first quarter of 2024, operating non-interest expense (non-GAAP) increased $12.7 million, or 5.4%. Salaries and employee benefits increased $6.0 million, or 4.7%, primarily reflecting strategic hiring associated with our efforts to grow market share and continued investments in our risk management infrastructure as well as higher performance and production-related compensation. Outside services increased $3.5 million, or 15.1%, due to higher volume-related technology and third-party costs associated with ongoing investments in our enterprise risk management framework. Net occupancy and equipment increased $2.3 million, or 5.2%, largely from technology-related investments and increased occupancy costs.

The ratio of non-performing loans and OREO to total loans and OREO increased 15 basis points to 0.48%. Total delinquency increased 11 basis points to 0.75%, compared to 0.64%. Overall, asset quality metrics continue to remain at solid levels.

The provision for credit losses was $17.5 million, compared to $13.9 million. The first quarter of 2025 reflected net charge-offs of $12.5 million, or 0.15% annualized of total average loans, compared to $12.8 million, or 0.16% annualized. The allowance for credit losses (ACL) was $428.9 million, an increase of $22.6 million, with the ratio of the ACL to total loans and leases stable at 1.25%.

The effective tax rate was 20.9%, compared to 21.5% in the first quarter of 2024.

The CET1 regulatory capital ratio was 10.7% (estimated) at March 31, 2025, and 10.2% at March 31, 2024. Tangible book value per common share (non-GAAP) was $10.83 at March 31, 2025, an increase of $1.19, or 12.3%, from $9.64 at March 31, 2024. AOCI reduced the current quarter tangible book value per common share (non-GAAP) by $0.34, compared to a reduction of $0.70 at the end of the year-ago quarter.

First Quarter 2025 Results – Comparison to Prior Quarter
(All comparisons refer to the fourth quarter of 2024, except as noted)

Net interest income totaled $323.8 million, an increase of $1.6 million, or 0.5%, from the prior quarter total of $322.2 million, reflecting lower cost of interest-bearing deposits, partially offset by lower earning asset yields and the impact of two less days in the quarter. The total yield on earning assets (non-GAAP) declined 11 basis points to 5.23%, reflecting the impact of the FOMC interest rate cuts on loan yields. The total cost of funds decreased 10 basis points to 2.32%, as the cost of interest-bearing deposits decline of 24 basis points to 2.76% was partially offset by the long-term borrowing costs increasing 7 basis points to 5.11%, inclusive of the December 2024 offering of $500 million aggregate principal amount of senior notes due in 2030. The resulting net interest margin (FTE) (non-GAAP) was stable at 3.03%.

Average loans and leases totaled $34.1 billion, an increase of $220.4 million, or 2.6% annualized, as average consumer loans increased $186.7 million, or 6.0% annualized, and average commercial loans and leases increased $33.7 million, or 0.6% annualized. The increase in average commercial loans and leases included growth of $48.5 million in commercial leases and $43.5 million in commercial and industrial loans, partially offset by a decline of $60.0 million in commercial real estate. For consumer lending, average residential mortgages increased $152.0 million and average indirect auto loans increased $41.1 million.

Average deposits totaled $37.0 billion, a slight increase of $0.3 million, due to organic growth in new and existing customer relationships more than offsetting the normal seasonal outflows in the first quarter of the year. The increase in average interest-bearing demand deposits of $529.6 million was partially offset by declines in average time deposits of $304.2 million and average non-interest-bearing deposit balances of $214.5 million, resulting from customers' preferences for higher-yielding deposit products. The mix of non-interest-bearing demand deposits to total deposits was stable at 26% for March 31, 2025 and December 31, 2024. The loan-to-deposit ratio was 92% at March 31, 2025, compared to 91% at December 31, 2024.

Non-interest income totaled $87.8 million, an increase of $36.8 million, or 72.4%, from the prior quarter. When adjusting for the fourth quarter 2024 significant item of $34.0 million^[2], operating non-interest income (non-GAAP) increased $2.9 million, or 3.4%. Wealth Management revenues totaled a record $21.2 million, an increase of $2.7 million, or 14.4%, reflecting 7.3% and 26.1% increases in trust income and securities commissions and fees, respectively. Bank-owned life insurance increased $1.8 million, due to elevated life insurance claims. Insurance commissions and fees increased $1.3 million, or 28.0%, largely driven by seasonal contingent revenues. Capital markets income totaled $5.3 million, a decrease of $1.2 million, or 19.0%, given the lower commercial customer activity in the current macroeconomic environment.

Non-interest expense totaled $246.8 million, a decrease of $1.4 million, or 0.6% compared to the prior quarter. Salaries and employee benefits increased $7.1 million, primarily due to normal seasonal long-term compensation expense of $7.6 million in the first quarter of 2025, as well as seasonally higher employer-paid payroll taxes which increased $4.4 million linked-quarter, offset by lower employer-paid healthcare costs. Bank shares and franchise tax expense increased $2.5 million due to charitable contributions that qualified for Pennsylvania bank shares tax credits in the prior quarter. Other non-interest expense declined $11.8 million, or 34.3%, as the Company recognized a financing receivable non-credit impairment of $10.4 million (pre-tax) in the fourth quarter of 2024 from a renewable energy investment tax credit transaction. The related renewable energy investment tax credits were recognized during the fourth quarter as a benefit to income taxes. The efficiency ratio (non-GAAP) totaled 58.5%, seasonally higher than 56.9% for the prior quarter.

The ratio of non-performing loans and OREO to total loans and OREO remained stable at 0.48%, and delinquency decreased 8 basis points to 0.75%. Overall, asset quality metrics continue to remain at solid levels. The provision for credit losses was $17.5 million, compared to $22.3 million. The first quarter of 2025 reflected net charge-offs of $12.5 million, or 0.15% annualized of total average loans, compared to $20.6 million, or 0.24% annualized. The ACL was $428.9 million, an increase of $6.1 million, with the ratio of the ACL to total loans and leases stable at 1.25%.

The effective tax rate was 20.9%, compared to (7.0)%, with the prior quarter rate favorably impacted by renewable energy investment tax credits recognized as part of a solar project financing transaction.

The CET1 regulatory capital ratio was 10.7% (estimated), compared to 10.6% at December 31, 2024. Tangible book value per common share (non-GAAP) was $10.83 at March 31, 2025, an increase of $0.34 per share. AOCI reduced the current quarter-end tangible book value per common share (non-GAAP) by $0.34, compared to a reduction of $0.47 at the end of the prior quarter.

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 shareholders, 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 income, 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. 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 certain items (e.g., FDIC special assessment, realized loss on investment securities restructuring and merger expenses) are not organic to running 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 2025 and 2024 were calculated using a federal statutory income tax rate of 21%.

Cautionary Statement Regarding Forward-Looking Information
This document contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward‑looking statements are those that do not relate to historical facts and that are based on current assumptions, beliefs, estimates, expectations and projections, many of which, by their nature, are inherently uncertain and beyond our control. Forward-looking statements may relate to various matters, including our financial condition, results of operations, plans, objectives, future performance, business or industry, and usually can be identified by the use of forward-looking words, such as “anticipates,” “assumes,” “believes,” “can,” “continues,” “could,” “estimates,” “expects,” “forecasts,” “goal,” “intends,” “likely,” “may,” “might,” “objective,” “plans,” “potential,” “projects,” “remains,” “should,” “target,” “trend,” “will,” “would,” or similar words or expressions or variations thereof, and the negative thereof, but these terms are not the exclusive means of identifying such statements. You should not place undue reliance on forward-looking statements, as they are subject to risks and uncertainties, including, but not limited to, those described below. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements we may make.

There are various important factors that could cause future results to differ materially from historical performance and any forward-looking statements. Factors that might cause such differences, include, but are not limited to:

• the credit risk associated with the substantial amount of commercial loans and leases in our loan portfolio;
• the volatility of the mortgage banking business;
• changes in market interest rates and the unpredictability of monetary, tax and other policies of government agencies, including tariffs or the imposition of new tariffs, trade wars, barriers or restrictions, or threats of such actions;
• the impact of changes in interest rates on the value of our securities portfolios;
• changes in our ability to obtain liquidity as and when needed to fund our obligations as they come due, including as a result of adverse changes to our credit ratings;
• the risk associated with uninsured deposit account balances;
• regulatory limits on our ability to receive dividends from our subsidiaries and pay dividends to our shareholders;
• our ability to recruit and retain qualified banking professionals;
• the financial soundness of other financial institutions and the impact of volatility in the banking sector on us;
• changes and instability in economic conditions and financial markets, in the regions in which we operate or otherwise, including a contraction of economic activity and economic downturn;
• our ability to continue to invest in technological improvements as they become appropriate or necessary;
• any interruption in or breach in security of our information systems, or other cybersecurity risks;
• risks associated with reliance on third-party vendors;
• risks associated with the use of models, estimations and assumptions in our business;
• the effects of adverse weather events and public health emergencies;
• the risks associated with acquiring other banks and financial services businesses, including integration into our existing operations;
• the extensive federal and state regulations, supervision and examination governing almost every aspect of our operations, and potential expenses associated with complying with such regulations;
• our ability to comply with the consent orders entered into by First National Bank of Pennsylvania with the Department of Justice and the North Carolina State Department of Justice, and related costs and potential reputational harm;
• changes in federal, state or local tax rules and regulations or interpretations, or accounting policies, standards and interpretations;
• the effects of climate change and related legislative and regulatory initiatives; and
• any reputation, credit, interest rate, market, operational, litigation, legal, liquidity, regulatory and compliance risk resulting from developments related to any of the risks discussed above.

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 2024 Annual Report on Form 10-K (including the MD&A section), our subsequent 2025 Quarterly Reports on Form 10-Q (including the risk factors and risk management discussions) and our other 2025 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.

You should treat forward-looking statements as speaking only as of the date they are made and based only on information then actually known to FNB. FNB does not undertake, and specifically disclaims any obligation to update or revise any forward-looking statements to reflect the occurrence of events or circumstances after the date of such statements except as required by law.

Conference Call
F.N.B. Corporation (NYSE: FNB) announced the financial results for the first quarter of 2025 after the market close on Wednesday, April 16, 2025. 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, April 17, 2025 at 8:30 AM ET.

Participants are encouraged to pre-register for the conference call at: https://dpregister.com/sreg/10198322/fed3b79bbe. 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, April 24, 2025. 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 9469352. 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.