FNB Reports Q1 Net Income of $45.4M

PITTSBURGH, Pa. — F.N.B. Corp., the holding company of First National Bank of Pennsylvania, reports first-quarter net income of $45.4 million, or 14 cents per diluted common share.

That’s down from $93.2 million, or 29 cents per diluted common share in the fourth quarter of 2019, as well as from $92.1 million, or 28 centers per diluted common share, in net income from the first quarter of last year.

According to a company release, the results reflect a provision for credit losses of $37.9 million (9 cents per share) “related to the COVID-19 macroeconomic impacts under the newly adopted Current Expected Credit Losses Standard.” They also reflect branch consolidation costs of $8.3 million (2 cents per share), mortgage servicing rights impairment of $7.7 million (2 cents per share), accelerated vesting of certain 2020 stock grants of $5.6 million (1 cent per share), and $2 million in COVID-19-related expenses.

“Today’s COVID-19 pandemic and economic environment present all businesses, employees, customers and communities with new challenges,” FNB Corp. President, Chairman and CEO Vincent Delie Jr. said in the release. “As an essential business, FNB is committed to being there for our customers when they need us the most, while at the same time, protecting the health and safety of our employees.

“Our ongoing investments in technology and our digital platforms, including online appointment setting, enabled FNB to quickly meet customers’ needs in a new pandemic environment,” Delie continued. “We were able to develop an online application system in a week’s time to capture and process nearly 15,000 applications and $2.1 billion in the first allocation of funding to small businesses through participation in the SBA’s Paycheck Protection Program.”

The company also committed $1 million in relief assistance to community, benefiting food banks and providing funding for essential medical supplies, he noted.

Among the first-quarter highlights for F.N.B. are:

• Growth in total average loans was $1.1 billion, or 5.0%, with average commercial loan growth of $963 million and average consumer loan growth of $167 million with minimal average balance growth due to COVID-19.
• Total average deposits increased $1.2 billion, or 5.2%, primarily due to an increase in interest-bearing demand deposits of $1.4 billion, or 14.3%, and an increase in average non-interest-bearing deposits of $404 million, or 6.9%, partially offset by a decrease in average time deposits of $678 million, or 12.7%, largely from a managed decline in brokered CD balances.
• The loan to deposit ratio was 96.5% at March 31, 2020, compared to 94.7% at March 31, 2019, which includes a $249 million increase in commercial line utilization primarily due to COVID-19 related activity as of March 31, 2020.

The bank’s key performance ratios for 1Q2020, 4Q19 and 1Q19 include:

• Return on average equity: 3.91%, 7.78%, 8.21%
• Return on average assets: 0.55%, 1.10%, 1.14%
• Net interest margin: 3.14%, 3.07%, 3.26%
• Efficiency ratio: 59.03%, 55.99%, 53.45%

Net interest income for the first quarter was $232.6 million, up $2 million or 0.9% from the same quarter a year ago, and up $6.2 million, or 2.7%, from $226.4 million in the fourth quarter of 2019.

Total noninterest expenses, which includes salary, equipment, Federal Deposit Insurance Corp. premiums, marketing and data processing, was $194.9 million, an increase of $29.2 million from the first quarter of 2019. It also increased by $17.5 million, or 9.9%, from the fourth quarter of last year.

Nonperforming assets totaled $154 million, up from $129 million in the fourth quarter of 2019, and up from $132 million year-over-year.

Total assets were $35.04 billion, up from $34.6 billion in the fourth quarter of 2019, and up from $33.6 billion in last year’s first quarter.

Published by The Business Journal, Youngstown, Ohio.