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FC

FNB CORP/PA/ (FNB)·Q3 2025 Earnings Summary

Executive Summary

  • Record Q3 2025 results: diluted EPS $0.41 and total revenue $457.4M, both up sequentially, with positive operating leverage and a 52.4% efficiency ratio .
  • EPS beat Wall Street by ~11% (consensus $0.371), and revenue beat by ~$10.8M (consensus $446.7M). Bold beats reflect NIM expansion, deposit mix, and fee-income strength from capital markets and mortgage banking; S&P Global estimates used*.
  • CET1 reached 11.0% (estimated) and TBV/share rose 11% YoY to $11.48, enabling buybacks while supporting growth .
  • FY 2025 guidance raised for net interest income ($1.390–$1.405B) and non-interest income ($365–$370M), with provision trimmed ($85–$95M), and OpEx maintained ($975–$985M), reinforcing continued operating leverage into Q4 .
  • Key catalysts: continued deposit growth and stable NIB mix, disciplined CRE de-risking, and investment in AI/data science to drive revenue and efficiency .

What Went Well and What Went Wrong

What Went Well

  • Margin expansion and record revenue: NIM (FTE) rose to 3.25% (+6 bps QoQ), total revenue hit $457.4M, and non-interest income reached a record $98.2M .
  • Fee engines fired: Capital markets income +14% QoQ and +27% YoY; mortgage banking up +46% QoQ and +66% YoY on sold volumes and hedging gains .
  • Management tone on tech: “Our investments in digital capabilities, data analytics and Artificial Intelligence enable us to broaden household penetration…” — Vincent J. Delie, Jr. .

What Went Wrong

  • Commercial loan attrition: Average commercial balances fell linked-quarter, impacted by elevated secondary market attrition; CRE balances reduced intentionally .
  • Asset quality mixed sequentially: NPLs+OREO/Loans+OREO increased to 0.37% (+3 bps QoQ), and delinquency rose to 0.65% (+3 bps QoQ), though metrics remain solid .
  • Insurance commissions softened YoY and QoQ (-12% YoY/-12% QoQ), offset by strength elsewhere in fees .

Financial Results

Quarterly Trend (oldest → newest)

MetricQ1 2025Q2 2025Q3 2025
Total Revenue ($USD Millions)$411.6 (Net Interest $323.8 + Non-Interest $87.8) $438.2 $457.4
Net Interest Income ($USD Millions)$323.8 $347.2 $359.3
Non-Interest Income ($USD Millions)$87.8 $91.0 $98.2
Diluted EPS ($USD)$0.32 $0.36 $0.41
Net Income to Common ($USD Millions)$116.5 $130.7 $149.5
Net Interest Margin (FTE) (%)3.03 3.19 3.25
Efficiency Ratio (FTE) (%)58.50 54.83 52.38

Year-over-Year (Q3 2024 vs Q3 2025)

MetricQ3 2024Q3 2025
Total Revenue ($USD Millions)$413.0 $457.4
Net Interest Income ($USD Millions)$323.3 $359.3
Non-Interest Income ($USD Millions)$89.7 $98.2
Diluted EPS ($USD)$0.30 $0.41
NIM (FTE) (%)3.08 3.25
Efficiency Ratio (FTE) (%)55.16 52.38
CET1 (%) (est.)10.4 11.0
TBV per Share ($)$10.33 $11.48

Non-Interest Income Breakdown (Q3 2025)

Category ($USD Thousands)Q3 2025
Service charges23,191
Interchange & card13,424
Trust services11,647
Insurance commissions & fees4,495
Securities commissions & fees8,868
Capital markets income7,875
Mortgage banking operations9,183
Dividends on non-marketable equity6,110
Bank owned life insurance4,208
Net securities gains (losses)0
Other9,169
Total Non-Interest Income98,170

KPIs and Balance Sheet

KPIQ1 2025Q2 2025Q3 2025
Avg Loans & Leases ($B)34.05 34.50 34.81
Avg Deposits ($B)37.0 37.1 37.9
Loan-to-Deposit Ratio (%) (period-end)92 92 91
Provision for Credit Losses ($M)17.5 25.6 24.0
Net Charge-offs ($M)12.5 21.8 19.7
ACL / Loans (%)1.25 1.25 1.25
NPLs + OREO / Loans + OREO (%)0.48 0.34 0.37
CET1 (%) (est.)10.7 10.8 11.0
TBV/share ($)10.83 11.14 11.48

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Interest Income (GAAP)FY 2025n/a†$1.390–$1.405B Raised
Non-Interest IncomeFY 2025n/a†$365–$370M Raised
Provision ExpenseFY 2025n/a†$85–$95M Lowered high-end
Non-Interest ExpenseFY 2025n/a†$975–$985M Maintained
Effective Tax RateFY 2025n/a†21–22% Maintained
Spot Loans GrowthFY 2025n/a†Mid-single digits (lower end expected) Maintained (lower end)
Spot Deposits GrowthFY 2025n/a†Mid-single digits Maintained

†Prior-period specific ranges not disclosed in the Q1/Q2 press releases we reviewed; CFO stated ranges were raised for the second consecutive quarter .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
AI/Data science & digital platformEmphasis on digital tools (eStore), tech investments, “Clicks-to-Bricks”, margin/cost benefits Formed AI/innovation team; hired AI/Data leaders; using AI leads and pricing; investor day to showcase tech Expanding scope and execution
Deposits & betasNIB stable at ~26%; deposit growth and mix improvements Down-cycle terminal deposit beta mid-30s; year-end low/mid-20s depending on Fed cuts Improving cost dynamics
CRE risk managementIntentional CRE reduction; portfolio stress/testing NOO-CRE exposure reduced; criticized loans down 7.3%; office metrics disclosed De-risking continues
Capital & buybacksCET1 at record levels; buybacks initiated CET1 11%; continued buyback activity; dividend under discussion Ample capacity
Mortgage dynamicsPurchase-oriented; sold conforming; refi risk monitored Prepayment risk manageable; redeploy into C&I; retain servicing Stable to favorable
Macro (tariffs, gov’t)Monitored; no material portfolio impact cited in earlier periods No material impacts; monitoring shutdown/tariffs; asset quality solid Stable risk backdrop

Management Commentary

  • CEO strategic message: “Record earnings per diluted common share of $0.41… revenue of $457 million… peer-leading efficiency ratio (non-GAAP) of 52%… investments in digital capabilities, data analytics and Artificial Intelligence enable us to broaden household penetration…” — Vincent J. Delie, Jr. .
  • Credit stance: “Criticized loans were down 7.3%… NPL coverage remains strong… we continue to aggressively manage [non-owner] CRE… ending at 214% of capital.” — Gary L. Guerrieri .
  • Guidance and operating leverage: “Revised full-year net interest income $1.39–$1.405B… non-interest income $365–$370M… provision $85–$95M… efficiency ratio down nearly 280 bps YoY to 52.4%.” — Vincent J. Calabrese .
  • Organic expansion: Plan to add 30 new branches by 2030 across Carolinas/Mid-Atlantic to deepen client engagement using AI-driven e-store platform .

Q&A Highlights

  • Deposit betas and cost trajectory: Target mid-30% terminal down-cycle deposit beta; year-end low/mid-20% dependent on the timing of Fed cuts .
  • Capital deployment: CET1 at 11%; continued buybacks likely; dividend flexibility under review given sub-30% payout .
  • CRE and portfolio risk: Criticized down $113M QoQ; NOO-CRE delinquency/NPLs improved; continued exits/renewals to reduce concentration .
  • Mortgage refi risk: Prepayments viewed as redeployment opportunity into higher ROE C&I; retain servicing/cross-sell .
  • Investor day focus: Showcase new building and tech stack (AI, data science) to underpin revenue/efficiency growth .

Estimates Context

  • EPS vs consensus: Actual $0.41 vs consensus $0.371 → bold beat driven by NIM expansion and fee strength; 7 estimates*.
  • Revenue vs consensus: Actual $457.4M vs consensus $446.7M → bold beat on net interest and capital markets/mortgage banking; 5 estimates*.
  • Prior periods: Q2 2025 actual EPS $0.36 vs consensus $0.339*; revenue $438.2M vs $424.2M*; Q3 2024 actual EPS $0.30 vs $0.348*; revenue $413.0M vs $409.2M*.

*Values retrieved from S&P Global.

Estimates vs Actuals

MetricQ3 2024Q2 2025Q3 2025
Primary EPS Consensus Mean ($)0.348*0.339*0.371*
Diluted EPS Actual ($)0.30 0.36 0.41
Revenue Consensus Mean ($USD Millions)409.18*424.17*446.68*
Total Revenue Actual ($USD Millions)413.02 438.21 457.44
EPS # of Estimates8*8*7*
Revenue # of Estimates5*6*5*

Key Takeaways for Investors

  • Bold EPS and revenue beats reflect NIM expansion (3.25%) and diversified fee growth; expect continued positive operating leverage into Q4 .
  • Deposit growth and a stable 26% NIB mix support funding costs; down-cycle deposit betas suggest further cost tailwinds as rates decline .
  • CRE concentration reduction and stronger coverage (ACL/NPL ~350%) mitigate credit risk; criticized loans down QoQ .
  • Capital strength (CET1 11%, TBV $11.48) enables buybacks and potential dividend actions while funding growth; watch capital deployment pace .
  • Guidance raised for NII and non-interest income with provision trimmed; indicates confidence in margin and fee trajectory .
  • Near-term trading: Momentum from beats and guidance; watch investor day/AI initiatives and Q4 fee cadence as catalysts .
  • Medium-term thesis: Tech-driven deposit primacy, diversified fee growth (capital markets, mortgage, wealth), and disciplined credit underwriting underpin ROE expansion .