Yahoo Finance F N B Corp (FNB) (Q1 2024) Earnings Call Transcript Highlights: Key Financial Metrics and ...
Operating Earnings Per Share (EPS): $0.34
Operating Net Income: $123 million
Tangible Common Equity Ratio: 8%
Loan Growth: 6% year-over-year
Deposit Growth: 2% year-over-year
Total Deposit Cost: Less than 2%
Tangible Book Value Per Share: $9.64, up 11% year-over-year
Noninterest Income: $87.9 million
Liquidity and Coverage Ratio: Uninsured and non-collateralized deposit coverage ratio at 162%
Nonowner-Occupied CRE Portfolio Delinquency: 19 basis points
Nonowner-Occupied CRE Portfolio NPLs: 13 basis points
Net Charge-Offs: 16 basis points
Total Loans and Leases: $32.6 billion
Total Deposits: $34.7 billion
Net Interest Margin: 3.18%
Net Interest Income: $319 million
Wealth Management Revenues: $19.6 million
Mortgage Banking Operations: $7.9 million
Operating Noninterest Expense: $234.1 million
Release Date: April 18, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: On the NII guide and also on the loan-to-deposit ratio, could you discuss potential actions to mitigate reaching a 100% loan-to-deposit ratio? A: Vincent J. Calabrese, CFO, explained that historically, actions are taken when the ratio approaches 97%, such as generating close to $1 billion in CDs previously. The focus remains on generating deposits organically across the company, adjusting pricing strategies, and managing loan origination volumes. Vincent J. Delie, CEO, added that they have various strategies for both assets and liabilities to maintain a balanced approach.
Q: Can you provide details on what drove the improvement in delinquency and NPLs for office loans this quarter? A: Gary Lee Guerrieri, Chief Credit Officer, noted a slight increase in criticized office loans due to one specific credit, which is not a concern and is well-secured. The overall office loan portfolio saw a decrease in exposure and balance, indicating active management and solid performance.
Q: Regarding the fee income guidance update to the upper half of the range, which areas are performing better than expected? A: Vincent J. Delie, CEO, attributed this to diversification across fee-based businesses, including capital markets, syndications, derivatives, mortgage banking, and treasury management. The focus on building out services like merchant services and enhancing small business offerings contributes to this positive outlook.
Q: How are the swap agreements expiring in 2025 expected to impact the margin? A: Vincent J. Calabrese, CFO, mentioned that $1 billion of swaps will mature throughout 2025, which are currently a drag on earnings. The expiration of these swaps, starting with $250 million in January, will be beneficial for the financials moving forward.
Q: Could you discuss the trends in criticized and classified levels across the portfolio this quarter? A: Gary Lee Guerrieri, Chief Credit Officer, reported a slight increase in criticized credits, mainly in special mention categories due to softer performance. However, there are no concerns regarding losses, and proactive risk management is expected to improve these positions within 6 to 18 months.
Q: What is the outlook for commercial loan pipelines and mortgage banking strategy for the rest of the year? A: Vincent J. Delie, CEO, noted that commercial loan pipelines are up 15%, with strong activity in various regions. The mortgage banking strategy will continue to focus on purchase money mortgage loans, with an aggressive approach to selling loans to manage the balance sheet effectively. Seasonality affects mortgage revenue, but overall activity is expected to increase in the coming quarters.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
