F.N.B. Corp ((FNB)) has held its Q4 earnings call. Read on for the main highlights of the call.
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F.N.B. Corp’s recent earnings call was marked by a predominantly positive sentiment, reflecting strong financial performance and impressive growth metrics. The company showcased record noninterest income, significant loan and deposit growth, and an optimized balance sheet. Despite challenges related to deposit costs and increased noninterest expenses, F.N.B. has managed to improve its capital position and continue its expansion in digital capabilities while maintaining robust credit quality.
Strong Financial Performance
F.N.B. Corp reported an impressive fourth-quarter operating net income of $136.7 million, translating to $0.38 per diluted common share. For the full year 2024, the operating earnings per share (EPS) stood at $1.39. This financial achievement underscores the successful execution of the company’s strategic objectives, setting a solid foundation for future growth.
Record Noninterest Income
The earnings call highlighted F.N.B.’s record noninterest income, which reached an unparalleled $350 million. This milestone underscores the strength and diversification of F.N.B.’s business model, contributing significantly to its overall financial stability.
Loan and Deposit Growth
F.N.B. demonstrated robust loan and deposit growth, with loans increasing by 5% and deposits by 6.9% year-over-year. These figures not only outpace industry averages but also reflect the company’s strong market position and customer trust.
Balance Sheet Optimization
The company completed a strategic sale of low-yielding securities, reinvesting into higher-yield options. This move led to a 337 basis point improvement, showcasing F.N.B.’s proactive approach to optimizing its financial structure.
Improved Capital Position
F.N.B. achieved a record Common Equity Tier 1 (CET1) ratio of 10.6% and saw its tangible book value per share rise by 11% to a record $10.49. These metrics indicate a strengthened capital foundation, enhancing the company’s financial resilience.
Expansion of Digital and Fintech Capabilities
Investments in fintech have allowed F.N.B. to enhance consumer onboarding and expand its financial product offerings. This strategic focus is driving improved customer acquisition and fostering deeper customer relationships.
Credit Quality and Risk Management
The company maintained stable asset quality metrics, reflecting strong credit performance and effective risk management practices. F.N.B.’s proactive approach to credit risk ensures that it remains well-positioned in changing market conditions.
Higher Noninterest Expenses
The fourth quarter saw a rise in noninterest expenses, driven by renewable energy tax credit transaction costs and increased healthcare expenses. While these costs have grown, they align with the company’s broader strategic investments.
Deposit Cost Challenges
Despite strong deposit growth, managing the overall cost of funds remains a challenge for F.N.B., with total deposit costs at 2.2%. The company is working to address these challenges to maintain its competitive edge.
Forward-Looking Guidance
Looking ahead, F.N.B. Corp’s guidance for 2025 anticipates mid-single-digit growth in both loans and deposits. The company expects net interest income to range between $1.345 billion and $1.385 billion, with noninterest income projected between $350 million and $370 million. Noninterest expenses are expected to fall between $965 million and $985 million, with an effective tax rate of 21% to 22%. These forecasts take into account expected Federal Reserve rate cuts, underscoring F.N.B.’s strategic focus on optimizing its balance sheet, enhancing shareholder value, and expanding its market and technology offerings.
In summary, F.N.B. Corp’s earnings call reflects a strong and positive sentiment, with the company making notable strides in financial performance and strategic growth areas. Key takeaways include record noninterest income, significant loan and deposit growth, and a strengthened capital position, all of which position F.N.B. well for continued success in the financial sector.
