FNB(US:FNB)2025-08-06 16:47PART I – FINANCIAL INFORMATION Item 1. Financial Statements This section presents F.N.B. Corporation's unaudited consolidated financial statements, including balance sheets, income statements, and notes Consolidated Balance Sheets Total assets increased to $49.7 billion by June 30, 2025, driven by loan growth, with liabilities and equity also rising Consolidated Balance Sheet Summary (in millions) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $49,725 | $48,625 | | Net Loans and Leases | $34,247 | $33,516 | | Investment Securities (AFS & HTM) | $7,695 | $7,445 | | Goodwill | $2,480 | $2,478 | | Total Liabilities | $43,201 | $42,323 | | Total Deposits | $37,748 | $37,107 | | Total Borrowings (Short & Long-term) | $4,568 | $4,268 | | Total Shareholders' Equity | $6,524 | $6,302 | Consolidated Statements of Income Q2 2025 net income increased to $130 million ($0.36 diluted EPS), driven by a rise in net interest income Income Statement Highlights (in millions, except per share data) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Total Interest Income | $583 | $557 | $1,142 | $1,100 | | Net Interest Income | $348 | $316 | $671 | $635 | | Provision for credit losses | $26 | $20 | $43 | $34 | | Total Non-Interest Income | $91 | $88 | $179 | $176 | | Total Non-Interest Expense | $247 | $227 | $493 | $464 | | Net Income | $130 | $123 | $247 | $245 | | Diluted EPS | $0.36 | $0.34 | $0.68 | $0.66 | Notes to Consolidated Financial Statements This section details accounting policies and financial data, covering investment securities, loans, credit losses, and more - F.N.B. Corporation is a diversified financial services company with 351 branches across seven states and the District of Columbia, offering commercial banking, consumer banking, and wealth management solutions1617 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses F.N.B. Corporation's strong Q2 2025 financial performance, covering operations, condition, liquidity, and capital Financial Summary Q2 2025 saw strong financial results, including record revenue, high capital levels, and significant balance sheet growth - The company reported strong Q2 2025 results, including record revenue of $438.2 million, a CET1 ratio of 10.8%, and a 13% year-over-year increase in tangible book value per common share (non-GAAP)180182 - Balance sheet highlights for Q2 2025 include linked-quarter annualized average loan and deposit growth of 5.3% and 1.7%, respectively, and a significant decline in non-performing loans by $44 million (27.5%) from the prior quarter180182 Results of Operations Q2 2025 saw net interest income grow 9.9% to $347.2 million, while non-interest expense increased 8.7% Q2 2025 vs Q2 2024 Performance (in thousands) | Metric | Q2 2025 | Q2 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $347,196 | $315,890 | $31,306 | 9.9% | | Provision for Credit Losses | $25,601 | $20,189 | $5,412 | 26.8% | | Non-Interest Income | $91,015 | $87,922 | $3,093 | 3.5% | | Non-Interest Expense | $246,225 | $226,612 | $19,613 | 8.7% | | Net Income | $130,670 | $123,037 | $7,633 | 6.2% | - Net interest margin (FTE, non-GAAP) increased 10 basis points year-over-year to 3.19% in Q2 2025, benefiting from growth in earning assets and lower interest-bearing deposit costs185191 - Non-interest expense increased primarily due to a 7.4% rise in salaries and benefits from strategic hiring and a 10.1% increase in occupancy and equipment costs from technology investments and branch expansion185206 Financial Condition Total assets reached $49.7 billion by June 30, 2025, with growth in loans and deposits, and improved asset quality Loan Portfolio Composition (in millions) | Loan Type | June 30, 2025 | Dec 31, 2024 | $ Change | | :--- | :--- | :--- | :--- | | Total commercial loans and leases | $21,198 | $21,164 | $34 | | Total consumer loans | $13,481 | $12,775 | $706 | | Total loans and leases | $34,679 | $33,939 | $740 | Non-Performing Assets (in millions) | Category | June 30, 2025 | Dec 31, 2024 | $ Change | | :--- | :--- | :--- | :--- | | Total non-performing loans | $117 | $159 | ($42) | | Other real estate owned | $2 | $3 | ($1) | | Total non-performing assets | $119 | $162 | ($43) | - The Allowance for Credit Losses (ACL) on loans and leases increased to $432.1 million, representing a stable coverage ratio of 1.25% of total loans242 Capital Resources and Regulatory Matters The company maintains a strong capital position, exceeding regulatory thresholds, with a record CET1 ratio of 10.8% F.N.B. Corporation Capital Ratios | Ratio | June 30, 2025 | Minimum + Buffer | | :--- | :--- | :--- | | CET1 | 10.79% | 7.00% | | Tier 1 capital | 10.79% | 8.50% | | Total capital | 12.50% | 10.50% | | Leverage | 8.78% | 4.00% | - The company repurchased 0.7 million shares of common stock for $10.0 million during the second quarter of 2025250 Liquidity The company maintains a strong liquidity position with $755.7 million cash on hand and significant wholesale credit availability - Parent company cash on hand stood at $755.7 million as of June 30, 2025, with liquidity metrics well above internal limits262264 - The bank (FNBPA) has significant unused wholesale credit availability of $15.9 billion and $3.1 billion in cash and salable unpledged government securities, representing 6.4% of total assets269 Market Risk The company manages interest rate risk, with a slightly asset-sensitive balance sheet, actively reducing sensitivity through various strategies Net Interest Income Sensitivity (Rate Ramps) | Rate Change | NII Change over 12 months | | :--- | :--- | | +200 bps | +2.3% | | +100 bps | +1.2% | | -100 bps | -1.2% | | -200 bps | -2.5% | - The company's interest rate risk position is slightly asset sensitive, but management has taken actions to move it closer to a neutral position, reducing the 12-month cumulative repricing gap to 3.3% of assets from 4.5% at year-end 2024279281282 - In Q2 2025, the company executed $250 million notional of receive-fixed interest rate swaps to hedge variable rate commercial loans and lower asset sensitivity283 Quantitative and Qualitative Disclosures About Market Risk This section incorporates by reference the detailed discussion on market risk from Management's Discussion and Analysis - The information regarding market risk is provided in the Market Risk section of the MD&A and is incorporated here by reference310 Controls and Procedures Management concluded that FNB's disclosure controls and procedures were effective as of June 30, 2025, with no material changes - Management concluded that disclosure controls and procedures were effective as of the end of the period covered by the report311 - No changes occurred during the fiscal quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting313 PART II – OTHER INFORMATION Legal Proceedings This section details a settlement with the DOJ and North Carolina regarding fair lending concerns, involving mortgage subsidies - The company reached a settlement with the DOJ and North Carolina regarding fair lending concerns related to a predecessor bank's activities prior to a 2017 merger. The settlement includes a $11.75 million commitment for mortgage subsidies, which is part of an existing community program and did not include civil money penalties137314 Risk Factors No material changes to the risk factors previously disclosed in the 2024 Annual Report on Form 10-K and Q1 2025 Form 10-Q - There have been no material changes to the risk factors described in the company's 2024 Annual Report on Form 10-K and the Q1 2025 Form 10-Q315 Unregistered Sales of Equity Securities and Use of Proceeds F.N.B. Corporation repurchased 725,000 shares of common stock at $13.85 per share during Q2 2025 as part of its program Common Stock Purchases - Q2 2025 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | — | $— | | May 2025 | — | $— | | June 2025 | 725,000 | $13.85 | | Total | 725,000 | $13.85 | Other Information No director or officer adopted, modified, or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements in Q2 2025 - No director or officer adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2025320