F.N.B. CORPORATION PITTSBURGH, April 25, 2017 /PRNewswire/ -- F.N.B. Corporation (NYSE: FNB) reported earnings for the first quarter of 2017 with net income available to common stockholders of $21.0 million, or $0.09 per diluted common share, including $0.15 of merger-related expense and $0.01 of merger-related net securities gains. Comparatively, fourth quarter of 2016 net income available to common stockholders totaled $49.3 million, or $0.23 per diluted common share, and first quarter of 2016 net income available to common stockholders totaled $24.1 million, or $0.12 per diluted common share.
"We are very pleased with our first quarter financial results, which were achieved while successfully integrating our transformational merger with Yadkin," said Vincent J. Delie, Jr., President and Chief Executive Officer. "Our first quarter financial performance was highlighted by continued organic growth and solid contributions from our fee-based businesses. We are also pleased with the outstanding execution of our conversion teams whose goal was a seamless transition for our new customers and employees. The success of our past acquisitions demonstrates that we can generate positive operating leverage and bring our innovative products and services to new markets to win clients and gain market share. The addition of Yadkin is a great opportunity for FNB to expand in attractive Southeast markets and grow revenue. With our largest and most complex merger completed, we are well-positioned to deliver significant value to our shareholders."
Quarterly Results Summary 1Q17 4Q16 1Q16
---- ---- ----
Reported results
Net income available to common stockholders (millions) $21.0 $49.3 $24.1
Net income per diluted common share $0.09 $0.23 $0.12
Book value per common share (period-end) $13.16 $11.68 $11.50
Operating results (non-GAAP)
Operating net income available to common stockholders (millions) $54.4 $50.6 $40.6
Operating net income per diluted common share $0.23 $0.24 $0.21
Tangible common equity to tangible assets (period-end) 6.80% 6.64% 6.93%
Tangible book value per common share (period-end) $5.86 $6.53 $6.36
Average Diluted Common Shares Outstanding (in 000's) 239,255 212,748 194,878
Significant items influencing earnings1 (millions)
Pre-tax merger-related expenses ($52.7) ($1.6) ($24.9)
After-tax impact of merger-related expenses ($35.1) ($1.3) ($16.5)
Pre-tax merger-related net securities gains $2.6 $ - $ -
After-tax impact of net merger-related securities gains $1.7 $ - $ -
(1) Favorable (unfavorable) impact on earnings
Non-GAAP measures 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 GAAP to non-GAAP operating measures to the most directly comparable GAAP financial measures are included in the tables at the end of this release. Organic
growth refers to growth excluding the benefit of initial balances from acquisitions. Purchase accounting related to net interest margin refers to the accretable yield and any cash recoveries associated with
acquired loans.
First Quarter 2017 Highlights
(All comparisons refer to the fourth quarter of 2016, except as noted)
-- On March 11, 2017, we successfully closed and converted our acquisition
of Yadkin Financial Corporation (Yadkin), which included 98 branches and
over 100 ATMs. Additionally, total loans and deposits with preliminary
estimated fair values of $5.0 billion and $5.2 billion, respectively,
were added to our balance sheet.
-- Organic growth in total average loans was $194 million, or 5.3%
annualized, with average consumer loan growth of $117 million, or 7.8%
annualized (including residential mortgage, direct and indirect
installment and home-equity related products), and average commercial
loan growth of $89 million, or 4.2% annualized.
-- On an organic basis, average total deposits decreased $41 million and
were impacted by seasonal declines in business demand balances.
-- The net interest margin (FTE) (non-GAAP) remained stable at 3.35% and
the net interest margin excluding purchase accounting (FTE) (non-GAAP)
expanded 2 basis points to 3.28%.
-- The efficiency ratio on an operating basis (non-GAAP) was 57.2%,
compared to 55.4% in the prior quarter and 56.4% in the year-ago
quarter.
-- Credit quality results were satisfactory. Annualized net originated net
charge-offs were 0.25% of total average originated loans, compared to
0.38% annualized in the fourth quarter of 2016 and 0.21% annualized in
the year-ago quarter.
-- The tangible common equity to tangible assets ratio (non-GAAP) was 6.80%
at March 31, 2017, compared to 6.64% at December 31, 2016. The tangible
book value per common share (non-GAAP) was $5.86 at March 31, 2017, a
decline of $0.67 from December 31, 2016, due to the impact of the Yadkin
acquisition.
First Quarter 2017 Results - Comparison to Prior Quarter
Net Interest Income/Loans/Deposits
Net interest income totaled $172.8 million, increasing $13.5 million or 8.5%. The net interest margin (FTE) (non-GAAP) remained stable at 3.35% and included $3.0 million of purchase accounting accretion and $0.3 million of cash recoveries. Excluding the impact of purchase accounting, the net interest margin (FTE) (non-GAAP) expanded two basis points to 3.28%. Total average earning assets increased $2.0 billion or 10.2%, mostly due to the benefit of acquired Yadkin balances, as well as organic loan growth of $194 million and a $612 million increase in the securities portfolio in anticipation of the Yadkin closing and some planned growth.
Average loans totaled $16.2 billion and increased $1.4 billion, or 9.2%, reflecting the acquired Yadkin balances and the solid organic loan growth in the commercial and consumer portfolios. Average organic commercial loan growth totaled $89 million or 4.2% annualized, with much of the growth concentrated in the Pittsburgh, Maryland, and Cleveland markets. Average organic consumer loan growth was $117 million, or 7.8% annualized, led by strong demand and increased origination volume for indirect auto loans and continued growth in the residential mortgage portfolio.
Average deposits totaled $17.1 billion and increased $1.2 billion, or 7.3%, primarily reflecting the acquired Yadkin deposits. Noninterest bearing deposits grew slightly, as growth in personal demand accounts were offset by seasonal declines in interest checking and business demand accounts.
Non-Interest Income
Non-interest income totaled $55.1 million, increasing $4.1 million, or 7.9%, and included $2.6 million in net securities gains related to the sale of certain acquired Yadkin securities after the closing of the acquisition to align the portfolio with FNB's investment profile. The increase in non-interest income was due to positive performance in capital markets, insurance, and wealth management, as well as a slight benefit from a partial quarter of Yadkin activities. Capital markets benefited from fees earned on increased interest rate swap activity with commercial customers across our existing and newly acquired markets. Wealth management showed positive organic growth results and was supported in-part by favorable stock market conditions.
Non-Interest Expense
Non-interest expense totaled $187.6 million, increasing $63.7 million and included a $51.1 million increase in merger expense compared to the prior quarter. Excluding merger-related expenses, expenses would have increased $12.7 million. The efficiency ratio (non-GAAP) was 57.2%, compared to 55.4%. The increase was primarily due to infrastructure investments, pre-hiring in advance of the acquisition close, as well as seasonally higher expenses.
Credit Quality
The ratio of non-performing loans and OREO to total loans and OREO improved 2 basis points to 0.77%. For the originated portfolio, the ratio of non-performing loans and OREO to total loans and OREO increased 21 basis points to 1.12% and the increase was mostly driven by an estimated fair value of $19.4 million of acquired Yadkin OREO. The increase in total delinquency levels reflects the addition of the acquired Yadkin balances. Total originated delinquency, defined as total past due and non-accrual originated loans as a percentage of total originated loans, decreased 10 basis points to 0.94%, compared to 1.04% at December 31, 2016.
Net charge-offs totaled $8.1 million, or 0.20% annualized of total average loans, compared to $11.5 million, or 0.31% annualized. For the originated portfolio, net charge-offs were $7.9 million, or 0.25% annualized of total average originated loans, compared to $11.8 million or 0.38% annualized. The ratio of the allowance for loan losses to total loans and leases decreased 26 basis points from December 31, 2016, to 0.80% at March 31, 2017, with the decrease primarily due to the preliminary estimated fair value of $5.0 billion in loans from the Yadkin acquisition without a corresponding allowance for loan losses in accordance with accounting for business combinations. For the originated portfolio, the allowance for loan losses to total originated loans was 1.19%, compared to 1.20% at December 31, 2016. The total provision for loan losses totaled $10.9 million, compared to $12.7 million in the prior quarter.
First Quarter 2017 Results - Comparison to Prior-Year Quarter
Net Interest Income/Loans/Deposits
Net interest income totaled $172.8 million, increasing $32.4 million, or 23.1%, reflecting average earning asset growth of $4.4 billion, or 25.9%. The net interest margin (FTE) (non-GAAP) narrowed 5 basis points to 3.35% and included $0.8 million of higher purchase accounting accretion and $0.2 million of lower cash recoveries. Excluding purchase accounting, the net interest margin (FTE) (non-GAAP) narrowed 5 basis points to 3.28%.
Average loans totaled $16.2 billion, an increase of $2.9 billion, or 22.3%, due to the benefit from continued organic loan growth and previous acquired balances. Organic growth in total average loans equaled $786 million, or 5.6%. Total average organic consumer loan growth of $594 million, or 10.7%, was led by strong growth in residential mortgage and indirect auto loans. Organic growth in average commercial loans totaled $193 million, or 2.3%. Organic commercial loan growth compared to the year-ago quarter was somewhat offset by accelerated prepayment activity in the commercial acquired loan portfolio experienced in the second half of 2016. Average deposits totaled $17.1 billion and increased $2.9 billion, or 20.7% due to the benefit of previous acquired balances and average organic growth of $317 million or 2.1%. On an organic basis, average total transaction deposits increased $426 million or 3.4%. Total loans as a percentage of deposits was 94.6% at March 31, 2017.
Non-Interest Income
Non-interest income totaled $55.1 million, increasing $9.1 million or 19.7%. Non-interest income reflects the benefit of previous acquisitions and continued expansion of our fee-based businesses of capital markets, mortgage banking and insurance for our existing and acquired customer base.
Non-Interest Expense
Non-interest expense totaled $187.6 million, increasing $50.9 million, or 37.3%. First quarter 2017 included merger-related expenses of $52.7 million, compared to $24.9 million. Excluding merger-related expenses, total adjusted non-interest expense increased $23.1 million, or 20.7%, with the increase primarily attributable to the expanded operations from previous acquisitions. The efficiency ratio (non-GAAP) was 57.2%, compared to 56.4% in the first quarter of 2016.
Credit Quality
Credit quality results remained at satisfactory levels. For the originated portfolio, non-performing loans and OREO to total loans and OREO was 1.12%, compared to 1.18%. Total originated delinquency was 0.94% at March 31, 2017, a 1 basis point increase from March 31, 2016.
Net charge-offs for the first quarter of 2017 totaled $8.1 million, or 0.20% annualized of total average loans, compared to 0.18% annualized. Net originated charge-offs were 0.25% annualized of total average originated loans, compared to 0.21% annualized. For the originated portfolio, the allowance for loan losses to total originated loans was 1.19%, compared to 1.26% at March 31, 2016. The ratio of the allowance for loan losses to total loans decreased 24 basis points to 0.80%, with the movement due to additional loan balances from acquisitions which were initially recorded at fair value without a corresponding allowance for loan losses in accordance with accounting for business combinations. The total provision for loan losses was $10.9 million, compared to $11.8 million in the prior year.
Capital Position
The tangible common equity to tangible assets ratio (non-GAAP) was 6.80%, compared to 6.93% at March 31, 2016. Book value per common share increased to $13.16, from $11.50 at March 31, 2016. Tangible book value per common share (non-GAAP) was $5.86, compared to $6.36 at March 31, 2016.
Non-GAAP Financial Measures and Key Performance Indicators
We use non-GAAP financial measures, such as operating net income available to common stockholders, operating net income per diluted common share, 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, efficiency ratio, and net interest margin 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 measure their performance and trends. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, our reported results prepared in accordance with GAAP. Reconciliations of GAAP to non-GAAP operating measures to the most directly comparable GAAP financial measures are included in the tables at the end of this release.
We believe merger expenses are not organic costs to run our operations and facilities. These charges represent expenses to satisfy contractual obligations of acquired entities without any useful benefit to us and to convert and consolidate the entity's records onto our platforms. These costs are specific to each individual transaction and may vary significantly based on the size and complexity of the transaction.
For the calculation of net interest margin and the efficiency ratio, net interest income amounts are reflected on a fully taxable equivalent (FTE) basis which adjusts for the tax benefit of income on certain tax-exempt loans and investments using the federal statutory tax rate of 35.0% for each period presented. We use these measures to provide an economic view believed to be the preferred industry measurement for these items and provides relevant comparison between taxable and non-taxable amounts.
Conference Call
The Company's President and Chief Executive Officer, Vincent J. Delie, Jr., Chief Financial Officer, Vincent J. Calabrese, Jr., and Chief Credit Officer, Gary L. Guerrieri, will host a conference call to discuss the Company's financial results on Tuesday, April 25, 2017, at 10:30 AM ET.
Participants are encouraged to pre-register for the conference call at http://dpregister.com/10101511. Callers who pre-register will be provided a conference passcode and unique PIN to gain immediate access to the call and bypass the live operator. 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 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 "Shareholder and Investor Relations" section of the Corporation's website at www.fnbcorporation.com. 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 on the "About Us" section of our corporate website at www.fnbcorporation.com.
A replay of the call will be available shortly after the completion of the call until midnight ET on Tuesday, May 2, 2017. The replay can be accessed by dialing (877) 344-7529 or (412) 317-0088 for international callers; the conference replay access code is 10101511. Following the call, a transcript and the related presentation materials will be posted to the "Shareholder and Investor Relations" section of F.N.B. Corporation's website at www.fnbcorporation.com.
About F.N.B. Corporation
F.N.B. Corporation (NYSE:FNB), headquartered in Pittsburgh, Pennsylvania, is a diversified financial services company operating in eight states. FNB holds a significant retail deposit market share in attractive markets including: Pittsburgh, Pennsylvania; Baltimore, Maryland; Cleveland, Ohio; and Charlotte, Raleigh, Durham and the Piedmont Triad (Winston-Salem, Greensboro and High Point) in North Carolina. The Company has total assets of $30 billion, and more than 400 banking offices throughout Pennsylvania, Ohio, Maryland, West Virginia, North Carolina and South Carolina.
FNB provides a full range of commercial banking, consumer banking and wealth management solutions through its subsidiary network which is led by its largest affiliate, First National Bank of Pennsylvania, founded in 1864. Commercial banking solutions include corporate banking, small business banking, investment real estate financing, international banking, business credit, capital markets and lease financing. The consumer banking segment provides a full line of consumer banking products and services, including deposit products, mortgage lending, consumer lending and a complete suite of mobile and online banking services. FNB's wealth management services include asset management, private banking and insurance. The Company also operates Regency Finance Company, which has more than 75 consumer finance offices in Pennsylvania, Ohio, Kentucky and Tennessee. The common stock of F.N.B. Corporation trades on the New York Stock Exchange under the symbol "FNB" and is included in Standard & Poor's MidCap 400 Index with the Global Industry Classification Standard (GICS) Regional Banks Sub-Industry Index. Customers, shareholders and investors can learn more about this regional financial institution by visiting the F.N.B. Corporation website at www.fnbcorporation.com.
F.N.B. CORPORATION
------------------
(Unaudited)
(Dollars in thousands, except per share data)
Percent Variance
----------------
1Q17 - 1Q17 -
Statement of earnings 1Q17 4Q16 1Q16 4Q16 1Q16
--------------------- ----
Interest income $194,693 $177,168 $155,754 9.9 25.0
Interest expense 21,941 17,885 15,400 22.7 42.5
Net interest income 172,752 159,283 140,354 8.5 23.1
Non-interest income:
Service charges 24,807 25,175 21,134 -1.5 17.4
Trust income 5,747 5,218 5,282 10.1 8.8
Insurance commissions and fees 5,141 4,436 4,921 15.9 4.5
Securities commissions and fees 3,623 3,068 3,374 18.1 7.4
Capital markets income 3,847 3,978 2,849 -3.3 35.0
Mortgage banking operations 3,790 4,194 1,595 -9.7 137.5
Net securities gains (losses) 2,625 116 71 n/m n/m
Other 5,536 4,881 6,818 13.4 -18.8
Total non-interest income 55,116 51,066 46,044 7.9 19.7
Total revenue 227,868 210,349 186,398 8.3 22.2
Provision for credit losses 10,850 12,705 11,768 -14.6 -7.8
Non-interest expense:
Salaries and employee benefits 73,578 61,117 56,425 20.4 30.4
Occupancy and equipment 20,979 19,736 17,822 6.3 17.7
FDIC insurance 5,387 4,858 3,968 10.9 35.7
Amortization of intangibles 3,098 1,602 2,649 93.3 16.9
Other real estate owned 983 2,401 1,409 -59.1 -30.2
Merger-related 52,724 1,649 24,940 n/m n/m
Other 30,806 32,443 29,435 -5.0 4.7
Total non-interest expense 187,555 123,806 136,648 51.5 37.3
Income before income taxes 29,463 73,838 37,982 -60.1 -22.4
Income taxes 6,484 22,547 11,850 -71.2 -45.3
Net income 22,979 51,291 26,132 -55.2 -12.1
Preferred stock dividends 2,010 2,011 2,010
Net income available to common stockholders $20,969 $49,280 $24,122 -57.4 -13.1
======= ======= =======
Earnings per common share:
Basic $0.09 $0.23 $0.12 -60.9 -25.0
Diluted $0.09 $0.23 $0.12 -60.9 -25.0
Reconciliation of Operating Net Income (non-GAAP):
--------------------------------------------------
Net income available to common stockholders $20,969 $49,280 $24,122
Merger-related expense 52,724 1,649 24,940
Tax benefit of merger-related expense (17,579) (341) (8,411)
Merger-related net securities gains (2,609) 0 0
Tax expense of merger-related net securities gains 913 0 0
--- --- ---
Operating net income available to common stockholders (non-GAAP) $54,418 $50,588 $40,651 7.6 33.9
======= ======= =======
Earnings per diluted common share $0.09 $0.23 $0.12
Merger-related expense 0.22 0.01 0.13
Tax benefit of merger-related expense (0.07) (0.00) (0.04)
Merger-related net securities gains (0.01) 0.00 0.00
Tax expense of merger-related net securities gains 0.00 0.00 0.00
---- ---- ----
Operating earnings per diluted common share (non-GAAP) $0.23 $0.24 $0.21 -4.2 9.5
===== ===== =====
Common stock data
-----------------
Average diluted shares outstanding 239,254,649 212,748,337 194,877,922 12.5 22.8
Period end shares outstanding 322,906,763 211,059,547 209,733,291 53.0 54.0
Book value per common share $13.16 $11.68 $11.50 12.7 14.5
Tangible book value per common share (1) $5.86 $6.53 $6.36 -10.3 -7.8
Dividend payout ratio (common) 121.83% 51.82% 104.86%
F.N.B. CORPORATION
------------------
(Unaudited)
(Dollars in thousands, except per share data)
Percent Variance
----------------
1Q17 - 1Q17 -
Balance Sheet (at period end) 1Q17 4Q16 1Q16 4Q16 1Q16
---------------------------- ----
Assets
Cash and due from banks $381,416 $303,526 $260,426 25.7 46.5
Interest bearing deposits with banks 68,967 67,881 85,519 1.6 -19.4
------ ------ ------
Cash and cash equivalents 450,383 371,407 345,945 21.3 30.2
Securities available for sale 2,638,815 2,231,987 2,099,343 18.2 25.7
Securities held to maturity 2,922,152 2,337,342 1,776,020 25.0 64.5
Loans held for sale 75,270 11,908 7,683 532.1 879.6
Loans and leases, net of unearned income 20,177,650 14,896,943 14,165,599 35.4 42.4
Allowance for credit losses (160,782) (158,059) (147,800) 1.7 8.8
-------- -------- --------
Net loans and leases 20,016,868 14,738,884 14,017,799 35.8 42.8
Premises and equipment, net 355,435 243,956 208,672 45.7 70.3
Goodwill 2,250,305 1,032,129 1,006,934 118.0 123.5
Core deposit and other intangible assets, net 134,699 67,327 80,116 100.1 68.1
Bank owned life insurance 467,457 330,152 310,106 41.6 50.7
Other assets 879,310 479,725 471,906 83.3 86.3
------- -------
Total Assets $30,190,695 $21,844,817 $20,324,524 38.2 48.5
=========== =========== ===========
Liabilities
Deposits:
Non-interest bearing demand $5,537,679 $4,205,337 $3,896,782 31.7 42.1
Interest bearing demand 9,285,393 6,931,381 6,512,461 34.0 42.6
Savings 2,623,531 2,352,434 2,291,656 11.5 14.5
Certificates and other time deposits 3,879,669 2,576,495 2,689,584 50.6 44.2
--------- --------- ---------
Total Deposits 21,326,272 16,065,647 15,390,483 32.7 38.6
Short-term borrowings 3,585,963 2,503,010 1,563,888 43.3 129.3
Long-term borrowings 696,206 539,494 657,445 29.0 5.9
Other liabilities 226,459 165,049 194,687 37.2 16.3
------- ------- -------
Total Liabilities 25,834,900 19,273,200 17,806,503 34.0 45.1
Stockholders' Equity
Preferred Stock 106,882 106,882 106,882 0.0 0.0
Common stock 3,246 2,125 2,112 52.7 53.7
Additional paid-in capital 4,020,527 2,234,366 2,214,959 79.9 81.5
Retained earnings 299,818 304,397 242,045 -1.5 23.9
Accumulated other comprehensive loss (56,969) (61,369) (33,651) -7.2 69.3
Treasury stock (17,709) (14,784) (14,326) 19.8 23.6
------- -------
Total Stockholders' Equity 4,355,795 2,571,617 2,518,021 69.4 73.0
--------- --------- ---------
Total Liabilities and Stockholders' Equity $30,190,695 $21,844,817 $20,324,524 38.2 48.5
=========== =========== ===========
Selected average balances
-------------------------
Total assets $24,062,099 $21,609,635 $18,916,639 11.3 27.2
Earning assets 21,272,715 19,299,292 16,898,563 10.2 25.9
Interest bearing deposits with banks 90,242 93,481 123,445 -3.5 -26.9
Securities 4,979,645 4,363,935 3,526,198 14.1 41.2
Loans held for sale 12,358 21,639 6,128 -42.9 101.7
Loans and leases, net of unearned income 16,190,470 14,820,237 13,242,792 9.2 22.3
Allowance for credit losses 161,371 158,542 142,943 1.8 12.9
Goodwill and intangibles 1,398,635 1,101,797 974,672 26.9 43.5
Deposits 17,132,627 15,967,990 14,195,761 7.3 20.7
Short-term borrowings 3,202,033 2,316,169 1,559,504 38.2 105.3
Long-term borrowings 534,762 544,236 648,490 -1.7 -17.5
Total stockholders' equity 3,007,853 2,573,768 2,329,715 16.9 29.1
Preferred stockholders' equity 106,882 106,882 106,882 0.0 0.0
F.N.B. CORPORATION
------------------
(Unaudited)
(Dollars in thousands)
Percent Variance
----------------
1Q17 - 1Q17 -
1Q17 4Q16 1Q16 4Q16 1Q16
---- ---- ---- ---- ----
Performance ratios
------------------
Return on average equity 3.10% 7.93% 4.51%
Return on average tangible equity (1) 6.35% 14.14% 8.32%
Return on average tangible common equity (1) 6.26% 14.66% 8.39%
Return on average assets 0.39% 0.94% 0.56%
Return on average tangible assets (1) 0.46% 1.02% 0.63%
Net interest margin (FTE) (1) (2) 3.35% 3.35% 3.40%
Yield on earning assets (FTE) (1) (2) 3.77% 3.72% 3.76%
Cost of interest-bearing liabilities 0.54% 0.48% 0.48%
Cost of funds 0.43% 0.38% 0.38%
Efficiency ratio (1) 57.15% 55.38% 56.38%
Effective tax rate 22.01% 30.54% 31.20%
Capital ratios
--------------
Equity / assets (period end) 14.43% 11.77% 12.39%
Common equity / assets (period end) 14.07% 11.28% 11.86%
Leverage ratio 9.62% 7.70% 8.50%
Tangible equity / tangible assets (period end) (1) 7.18% 7.16% 7.48%
Tangible common equity / tangible assets (period end) (1) 6.80% 6.64% 6.93%
Balances at period end
----------------------
Loans and Leases:
-----------------
Commercial real estate $8,768,357 $5,435,162 $5,253,660 61.3 66.9
Commercial and industrial 3,792,679 3,042,781 3,046,267 24.6 24.5
Commercial leases 197,071 196,636 202,605 0.2 -2.7
------- ------- -------
Commercial loans and leases 12,758,107 8,674,579 8,502,532 47.1 50.1
Direct installment 1,965,118 1,844,399 1,790,802 6.5 9.7
Residential mortgages 2,342,167 1,844,574 1,531,379 27.0 52.9
Indirect installment 1,259,947 1,196,313 1,025,727 5.3 22.8
Consumer LOC 1,805,996 1,301,200 1,261,493 38.8 43.2
Other 46,315 35,878 53,666 29.1 -13.7
Total loans and leases $20,177,650 $14,896,943 $14,165,599 35.4 42.4
===========
Deposits:
---------
Non-interest bearing deposits $5,537,679 $4,205,337 $3,896,782 31.7 42.1
Interest bearing demand 9,285,393 6,931,381 6,512,461 34.0 42.6
Savings 2,623,531 2,352,434 2,291,656 11.5 14.5
Certificates of deposit and other time deposits 3,879,669 2,576,495 2,689,584 50.6 44.2
Total deposits $21,326,272 $16,065,647 $15,390,483 32.7 38.6
Average balances
----------------
Loans and Leases:
-----------------
Commercial real estate $6,222,381 $5,390,877 $4,751,188 15.4 31.0
Commercial and industrial 3,245,732 3,065,593 2,823,995 5.9 14.9
Commercial leases 196,159 194,111 204,220 1.1 -3.9
------- ------- -------
Commercial loans and leases 9,664,272 8,650,581 7,779,403 11.7 24.2
Direct installment 1,869,218 1,837,505 1,748,350 1.7 6.9
Residential mortgages 1,969,374 1,807,086 1,458,402 9.0 35.0
Indirect installment 1,226,488 1,169,559 1,006,943 4.9 21.8
Consumer LOC 1,416,184 1,299,832 1,205,762 9.0 17.5
Other 44,934 55,674 43,932 -19.3 2.3
Total loans and leases $16,190,470 $14,820,237 $13,242,792 9.2 22.3
Deposits:
---------
Non-interest bearing deposits $4,414,354 $4,123,539 $3,449,230 7.1 28.0
Interest bearing demand 7,416,346 6,972,890 6,116,380 6.4 21.3
Savings 2,412,798 2,310,901 2,053,764 4.4 17.5
Certificates of deposit and other time deposits 2,889,129 2,560,660 2,576,387 12.8 12.1
Total deposits $17,132,627 $15,967,990 $14,195,761 7.3 20.7
=========== =========== ===========
F.N.B. CORPORATION
------------------
(Unaudited)
(Dollars in thousands)
Percent Variance
----------------
1Q17 - 1Q17 -
Asset Quality Data 1Q17 4Q16 1Q16 4Q16 1Q16
------------------ ----
Non-Performing Assets
---------------------
Non-performing loans (3)
Non-accrual loans $81,390 $65,479 $63,036 24.3 29.1
Restructured loans 23,988 20,428 21,453 17.4 11.8
------ ------ ------
Non-performing loans 105,378 85,907 84,489 22.7 24.7
Other real estate owned (OREO) (4) 50,088 32,490 50,526 54.2 -0.9
------ ------ ------
Total non-performing assets $155,466 $118,397 $135,015 31.3 15.1
======== ======== ========
Non-performing loans / total loans and leases 0.52% 0.58% 0.60%
Non-performing loans / total originated loans
and leases (5) 0.77% 0.66% 0.74%
Non-performing loans + OREO / total loans and
leases + OREO 0.77% 0.79% 0.95%
Non-performing loans + OREO / total originated
loans and leases + OREO (5) 1.12% 0.91% 1.18%
Non-performing assets / total assets 0.51% 0.54% 0.66%
Allowance Rollforward
---------------------
Allowance for credit losses (originated portfolio) (5)
Balance at beginning of period $150,792 $150,514 $135,285 0.2 11.5
Provision for credit losses 11,336 12,126 12,840 -6.5 -11.7
Net loan charge-offs (7,914) (11,848) (5,905) -33.2 34.0
Allowance for credit losses (originated portfolio) (5) 154,214 150,792 142,220 2.3 8.4
Allowance for credit losses (acquired portfolio) (6)
Balance at beginning of period 7,267 6,380 6,727 13.9 8.0
Provision for credit losses (486) 579 (1,072) -183.9 -54.7
Net loan (charge-offs)/recoveries (213) 308 (75) -169.2 184.0
---- --- ---
Allowance for credit losses (acquired portfolio) (6) 6,568 7,267 5,580 -9.6 17.7
Total allowance for credit losses $160,782 $158,059 $147,800 1.7 8.8
======== ======== ========
Allowance for credit losses / total loans and leases 0.80% 1.06% 1.04%
Allowance for credit losses (originated loans and leases) /
total originated loans and leases (5) 1.19% 1.20% 1.26%
Allowance for credit losses (originated loans and leases) /
total non-performing loans (3) 153.78% 182.75% 170.43%
Net loan charge-offs (annualized) / total average loans
and leases 0.20% 0.31% 0.18%
Net loan charge-offs on originated loans and leases
(annualized) / total average originated loans and
leases (5) 0.25% 0.38% 0.21%
Delinquency - Originated Portfolio (5)
-------------------------------------
Loans 30-89 days past due $38,398 $59,850 $36,711 -35.8 4.6
Loans 90+ days past due 6,932 9,113 6,120 -23.9 13.3
Non-accrual loans 76,294 62,083 61,997 22.9 23.1
------ ------ ------
Total past due and non-accrual loans $121,624 $131,046 $104,828 -7.2 16.0
======== ======== ========
Total past due and non-accrual loans / total originated loans 0.94% 1.04% 0.93%
Memo item:
Delinquency - Acquired Portfolio (6) (7)
---------------------------------------
Loans 30-89 days past due $85,170 $24,210 $44,651 251.8 90.7
Loans 90+ days past due 69,213 40,524 47,913 70.8 44.5
Non-accrual loans 5,096 3,396 1,039 n/m n/m
Total past due and non-accrual loans $159,479 $68,130 $93,603 134.1 70.4
======== ======= =======
F.N.B. CORPORATION
------------------
(Unaudited)
(Dollars in thousands, except per share data)
1Q17 4Q16
Interest Average Interest Average
Average Earned Yield Average Earned Yield
Outstanding or Paid or Rate Outstanding or Paid or Rate
Assets
Interest bearing deposits with banks $85,663 $180 0.83% $93,481 $87 0.37%
Federal funds sold 4,579 8 0.72% 0 0 0.00%
Taxable investment securities (8) 4,479,439 22,479 2.01% 3,975,670 18,952 1.91%
Non-taxable investment securities (2) 500,206 5,190 4.15% 388,265 4,000 4.12%
Loans held for sale 12,358 163 5.61% 21,639 222 4.10%
Loans and leases (2) (9) 16,190,470 170,195 4.26% 14,820,237 157,006 4.22%
Total Interest Earning Assets (2) 21,272,715 198,215 3.77% 19,299,292 180,267 3.72%
----------
Cash and due from banks 294,739 281,314
Allowance for loan losses (161,371) (158,542)
Premises and equipment 273,908 234,783
Other assets 2,382,108 1,952,788
Total Assets $24,062,099 $21,609,635
Liabilities
Deposits:
Interest-bearing demand $7,416,346 4,831 0.26% $6,972,890 4,429 0.25%
Savings 2,412,798 521 0.09% 2,310,901 434 0.07%
Certificates and other time 2,889,129 6,388 0.90% 2,560,660 5,989 0.93%
Short-term borrowings 3,202,033 6,674 0.84% 2,316,169 3,656 0.63%
Long-term borrowings 534,762 3,527 2.68% 544,236 3,377 2.47%
Total Interest Bearing Liabilities 16,455,068 21,941 0.53% 14,704,856 17,885 0.48%
----------
Non-interest bearing demand deposits 4,414,354 4,123,539
Other liabilities 184,824 207,472
Total Liabilities 21,054,246 19,035,867
Stockholders' equity 3,007,853 2,573,768
Total Liabilities and Stockholders' Equity $24,062,099 $21,609,635
Net Interest Earning Assets $4,817,647 $4,594,436
========== ==========
Net Interest Income (FTE) (2) 176,274 162,382
Tax Equivalent Adjustment (3,522) (3,099)
------ ------
Net Interest Income $172,752 $159,283
======== ========
Net Interest Spread 3.24% 3.24%
==== ====
Net Interest Margin (2) 3.35% 3.35%
==== ====
F.N.B. CORPORATION
------------------
(Unaudited)
(Dollars in thousands, except per share data)
1Q16
Interest Average
Average Earned Yield
Outstanding or Paid or Rate
Assets
Interest bearing deposits with banks $123,445 $117 0.38%
Federal funds sold 0 0 0.00%
Taxable investment securities (8) 3,254,474 16,493 2.03%
Non-taxable investment securities (2) 271,724 3,092 4.55%
Loans held for sale 6,128 77 5.06%
Loans and leases (2) (9) 13,242,792 138,438 4.20%
Total Interest Earning Assets (2) 16,898,563 158,217 3.76%
----------
Cash and due from banks 248,949
Allowance for loan losses (142,943)
Premises and equipment 191,543
Other assets 1,720,527
Total Assets $18,916,639
Liabilities
Deposits:
Interest-bearing demand $6,116,380 3,456 0.22%
Savings 2,053,764 364 0.07%
Certificates and other time 2,576,387 5,666 0.88%
Short-term borrowings 1,559,504 2,361 0.60%
Long-term borrowings 648,490 3,553 2.20%
Total Interest Bearing Liabilities 12,954,525 15,400 0.47%
----------
Non-interest bearing demand deposits 3,449,230
Other liabilities 183,169
Total Liabilities 16,586,924
Stockholders' equity 2,329,715
Total Liabilities and Stockholders' Equity $18,916,639
Net Interest Earning Assets $3,944,038
==========
Net Interest Income (FTE) (2) 142,817
Tax Equivalent Adjustment (2,463)
------
Net Interest Income $140,354
========
Net Interest Spread 3.29%
====
Net Interest Margin (2) 3.40%
====
F.N.B. CORPORATION
------------------
(Unaudited)
(Dollars in thousands, except per share data)
NON-GAAP FINANCIAL MEASURES AND KEY PERFORMANCE INDICATORS
----------------------------------------------------------
We believe the following non-GAAP financial measures provide information useful to investors in understanding our operating performance and trends, and facilitate comparisons with the performance of our peers. The non-GAAP financial measures we use may differ from
the non-GAAP financial measures other financial institutions use to measure their results of operations. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, our reported results prepared in accordance with U.S. GAAP. The
following tables summarize the non-GAAP financial measures included in this press release and derived from amounts reported in our financial statements.
1Q17 4Q16 1Q16
---- ---- ----
Return on average tangible equity:
----------------------------------
Net income (annualized) $93,191 $204,050 $105,101
Amortization of intangibles, net of tax (annualized) 10,071 5,857 8,404
------ ----- -----
Tangible net income (annualized) 103,262 209,907 113,505
Average total stockholders' equity 3,007,853 2,573,768 2,329,715
Less: Average intangibles (1,381,712) (1,089,216) (965,595)
---------- ---------- --------
Average tangible stockholders' equity 1,626,141 1,484,552 1,364,120
Return on average tangible equity (non-GAAP) 6.35% 14.14% 8.32%
==== ===== ====
Return on average tangible common equity:
-----------------------------------------
Net income available to common stockholders (annualized) $85,042 $196,049 $97,020
Amortization of intangibles, net of tax (annualized) 10,071 5,857 8,404
------ ----- -----
Tangible net income available to common stockholders (annualized) 95,113 201,906 105,424
Average total stockholders' equity 3,007,853 2,573,768 2,329,715
Less: Average preferred stockholders' equity (106,882) (106,882) (106,882)
Less: Average intangibles (1,381,712) (1,089,216) (965,595)
---------- ---------- --------
Average tangible common equity 1,519,259 1,377,670 1,257,238
Return on average tangible common equity (non-GAAP) 6.26% 14.66% 8.39%
==== ===== ====
Return on average tangible assets:
----------------------------------
Net income (annualized) $93,191 $204,050 $105,101
Amortization of intangibles, net of tax (annualized) 10,071 5,857 8,404
------ ----- -----
Tangible net income (annualized) 103,262 209,907 113,505
Average total assets 24,062,099 21,609,635 18,916,639
Less: Average intangibles (1,381,712) (1,089,216) (965,595)
---------- ---------- --------
Average tangible assets 22,680,387 20,520,419 17,951,044
Return on average tangible assets (non-GAAP) 0.46% 1.02% 0.63%
==== ==== ====
Tangible book value per common share:
-------------------------------------
Total stockholders' equity $4,355,795 $2,571,617 $2,518,021
Less: preferred stockholders' equity (106,882) (106,882) (106,882)
Less: intangibles (2,356,800) (1,085,935) (1,077,809)
---------- ---------- ----------
Tangible common equity 1,892,113 1,378,800 1,333,330
Common shares outstanding 322,906,763 211,059,547 209,733,291
Tangible book value per common share (non-GAAP) $5.86 $6.53 $6.36
===== ===== =====
F.N.B. CORPORATION
------------------
(Unaudited)
(Dollars in thousands)
1Q17 4Q16 1Q16
----
Tangible equity / tangible assets (period end):
-----------------------------------------------
Total shareholders' equity $4,355,795 $2,571,617 $2,518,021
Less: intangibles (2,356,800) (1,085,935) (1,077,809)
---------- ---------- ----------
Tangible equity 1,998,995 1,485,682 1,440,212
Total assets 30,190,695 21,844,817 20,324,524
Less: intangibles (2,356,800) (1,085,935) (1,077,809)
---------- ---------- ----------
Tangible assets 27,833,895 20,758,882 19,246,713
Tangible equity / tangible assets (period end) (non-GAAP) 7.18% 7.16% 7.48%
==== ==== ====
Tangible common equity / tangible assets (period end):
------------------------------------------------------
Total stockholders' equity $4,355,795 $2,571,617 $2,518,021
Less: preferred stockholders' equity (106,882) (106,882) (106,882)
Less: intangibles (2,356,800) (1,085,935) (1,077,809)
---------- ---------- ----------
Tangible common equity 1,892,113 1,378,800 1,333,330
Total assets 30,190,695 21,844,817 20,324,524
Less: intangibles (2,356,800) (1,085,935) (1,077,809)
---------- ---------- ----------
Tangible assets 27,833,895 20,758,882 19,246,715
Tangible common equity / tangible assets (period end) (non-GAAP) 6.80% 6.64% 6.93%
==== ==== ====
KEY PERFORMANCE INDICATORS
--------------------------
Efficiency Ratio (FTE):
-----------------------
Total non-interest expense $187,555 $123,806 $136,648
Less: amortization of intangibles (3,098) (1,602) (2,649)
Less: OREO expense (983) (2,401) (1,409)
Less: merger-related expense (52,724) (1,649) (24,940)
Less: impairment charge on other assets 0 0 (2,585)
--- --- ------
Adjusted non-interest expense 130,750 118,154 105,065
Net interest income 172,752 159,283 140,354
Taxable equivalent adjustment 3,522 3,099 2,463
Non-interest income 55,116 51,066 46,044
Less: net securities gains (2,625) (116) (71)
Less: gain on redemption of trust preferred securities 0 0 (2,422)
--- --- ------
Adjusted net interest income (FTE) + non-interest income 228,765 213,332 186,368
Efficiency ratio (FTE) (non-GAAP) 57.15% 55.38% 56.38%
===== ===== =====
Net Interest Margin:
--------------------
Net interest margin (FTE) (non-GAAP) (2) 3.35% 3.35% 3.40%
Purchase accounting impact -0.07% -0.09% -0.07%
----- ----- -----
Net interest margin, excluding purchase accounting
impact (FTE) (non-GAAP)(2) 3.28% 3.26% 3.33%
==== ==== ====
(1) See non-GAAP financial measures
section of this Press Release
for additional information
relating to the calculation of
this item.
(2) The net interest margin and
yield on earning assets (all
non-GAAP measures) are
presented on a fully taxable
equivalent (FTE) basis, which
adjusts for the
tax benefit of income on certain
tax-exempt loans and
investments using the federal
statutory tax rate of 35% for
each period presented.
(3) Does not include loans acquired
at fair value ("acquired
portfolio").
(4) Includes all other real estate
owned, including those balances
acquired through business
combinations that have been in
acquired loans prior to
foreclosure.
(5) "Originated Portfolio" or
"Originated Loans and Leases"
equals loans and leases not
included by definition in the
Acquired Portfolio.
(6) "Acquired Portfolio" or
"Acquired Loans" equals loans
acquired at fair value,
accounted for in accordance
with ASC 805 which was
effective January 1, 2009.
The risk of credit loss on these
loans has been considered by
virtue of our estimate of
acquisition-date fair value
and these loans are considered
accruing as
we primarily recognize interest
income through accretion of the
difference between the carrying
value of these loans and their
expected cash flows. Because
acquired loans are initially
recorded at an amount estimated
to be collectible, losses on
such loans, when incurred, are
first applied against the non-
accretable
difference established in
purchase accounting and then to
any allowance for loan losses
recognized subsequent to
acquisition.
(7) Represents contractual balances.
(8) The average balances and yields
earned on taxable investment
securities are based on
historical cost.
(9) Average balances for loans
include non-accrual loans.
Loans and leases consist of
average total loans and leases
less average unearned income.
The amount
of loan fees included in
interest income is immaterial.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/fnb-corporation-reports-first-quarter-2017-earnings-300444806.html
SOURCE F.N.B. Corporation
