F.N.B. (FNB) 20 Jul 232023 Q2 Earnings call transcript

Good morning and welcome to the F.N.B. Corporation Second Quarter 2023 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded.

to Investor conference Relations. like Constantine, to now of Manager would turn over the Lisa I Please ahead. go

Thank you. the Good contain call. the This morning and forward-looking and welcome call Securities financial F.N.B. to statements of and Corporation measures. Commission and Exchange reported non-GAAP with conference files also our earnings

directly of in to Non-GAAP reported accordance in results viewed and GAAP GAAP non-GAAP as measures addition compatible Reconciliations operating to financial most are in measures our should an measures not the prepared material with to presentation be our included alternative our financial GAAP. for release. earnings in and

on Please related corporate of replay call and materials posted non-GAAP with webcast website. forward-looking will our registration this until About Thursday, be of will be and the contained to available our statements Investor and filed in the Exchange refer July Us our to corporate reports section website. link and XXth the A statement these Securities available disclosures and Relations Commission

will I call Delie, Vince CEO. to President over and Chairman, turn now the

Thank our earnings second you to call. quarter welcome and

Vince today Calabrese, Chief and Gary Financial are Guerrieri, Officer. our me Joining Officer; Chief Credit our

over South loan benefited increased production, X.X% in operating Harrisburg year-to-date Average loan I to income common on of quarter the equity diluted resulting year-to-date increase net the operating and solid available pre-provision revenue million, to XX% a Carolina to quarter second share tangible XX.X%. North stockholders $X.XX, ratio reported to per and an think same in improvement an XX% return Operating from $XX common increase over balance or brings in efficiency to $X.XX operating and increased on an primarily the XXXX. total reported $XXX.X share period in and we Commercial This markets. net the XX% totaled Pittsburg, basis. earnings is billion. in linked per common

caused competition deposit clients. due payments by the quarter macroeconomic deposit end. deposits Average our disruption, decrease of June X.X% from quarter stable of XX%. XX.X% first impact was the banking at of seasonal acceleration deposits by total ratio totaled to Despite relatively XX to at noninterest-bearing and -deposit over remained the $XX caused outflows largely The recent at inflationary the tax on billion, loan-to a environment mix the related the deposits

strong deposit Our and a customers the primary relationships serving bank. our of mix as their was on focus result with fostering

our for build Over deposit bankers, past grown market we've enhanced product convenience, digital that the and expanded our presence years, our and exceptional customers suite trust, a of experiences best-in-class several offer and strategically our stable team capabilities, to mix.

For multiple to capabilities specific example, intend award-winning technology, products that delivers single products universal and intelligence be where customers and eStore advanced efficient ability data the offer recommendations apply simultaneously. sophisticated Utilizing secure customer Common App cater including enabling a the process with launched recently we our for artificial application application product majority Account to Common Common needs. learning, of in to to and bank customized offer to machine eStore, first the services, we with the the our a App, for application, more

Common for application Application and multiple amount numerous products. to minimizes pre-filling the keystrokes of complete time By reduces fields, needed an significantly the customer

XXXX, be shortly last month, first will after The consumer Consumer added the and half we will the Common first products Application, phase in which products. the follow deposit business by of XXXX. launched products loan of includes of all end

the have we in fee-based month compared ago, digital, online Outside process has of of offering. increase our invest actively The capability. for to continued XXX% over to continue of expect year the a increase applications and streamlined we we to an June, services this to as led promote in to number

increase growth, platform Management now drive organic are low-cost our deposits. award-winning Treasury generate We expanding strategic revenue, with and to priorities

reduced clients of billion from new payment, outsourcing quarter while simultaneously This and Solutions alone, benefiting $X check Integrated Payable nearly executed risk. fraud our product of

providing annual leveraged three has clients. of FMB with in grow and high-value through continue share. over fee-based also product compounded which our have the These and diversify rate integrated commercial We deposit payables to help noninterest-bearing and to income expand services. comprehensive growth years, business commercial card continues to to accounts increase services investments market our steadily past to deeper continues XX% set continue FMB a grow our penetration further and with streams, small customers revenue,

spot our an been underwriting remains guidelines. This loan while conservative part our and growth year-over-year has quarter's XX% of culture. integral consistent management Risk achieved adhering to

over more in turn Gary? asset now risks. our on and comment call I’ll the detail to quality Gary credit to

everyone. ended We metrics you, asset morning, near levels. historically quarter and good remaining with quality our the Thank Vince, low

XX point loans for office at assets XX the points. basis I the basis asset performance down period total more delinquency points, at quality and of quarter down for OREO XX an Our by end portfolio. were and quarter Criticized classified these on basis and update cover one our NPLs reflects quarter-over-quarter, were at followed basis highlights in net charge-offs basis XX the the points. at will points, detail,

nine to in Let's up loans increase now primary as was quarter. Net primarily walk delinquency with on This our OREO eight million, and reserves. reserved the quarter points through basis XX end, and totaled attributed non-performing an the points to based points exposure. points single basis use the business loan, C&I increased we NPLs $X.X percent our in specific previously prior the credit of of basis, were The At OREO the annualized and emerging quarter for Total at reflecting total our of a $XX quarter approximately compared or million quarter, status. credit NPLs surfaced right end basis on a the for charge-offs basis XX results. and borrower established an from partner. of between XX% their issue

reduction loan offset growth the in in mentioned loans. providing Total million, classified reserve, specific for the provision for releases quarter the $XX.X from stood expense previously at by

a consistent portfolios the strong increased test position peers. our economic and funded or reserve in committed strong and discounts. unamortized management balanced, reflecting When solid the at unamortized proactively credit company-wide remain quarter, loan consistent where ongoing review throughout including position $XXX an underwriting million, NPL acquired to reserve a our current We to with risk Our our $X.X we the remains X.XX% XXX%, to at portfolio relative test prior stands at million loan X.XX%, cycles. our and We inclusive including stress loans, maintain basis, discounts, and a stress of well-positioned quarter, years. performed full stands in of ending on coverage strong

the pleased of confirms that downturn We our enables the results, credit as withstand outcome management proactive to it portfolio diversified scenarios. economic with us various and were risk

remains estate office at XX loans below matured the loans very and XX%, delinquency by the Regarding required. renewed remain in office all basis no secured with negative with commercial We criticized quarter. low points, properties the real migration portfolio, quarter in downgrades that no

continue this We have as we manage basis, in-depth to will loan-by-loan part reviews the on a and regularly of portfolio proactively perform.

throughout as our trends closely loan to of we in remain we'll in has footprint, In We markets closing, metrics credit and asset markets. philosophy, diversified served continue attractive historical economic various continue growth core macroeconomic and our which aggressively proactively the cycles. part individual and to generate manage risk us and quality well monitor near lows,

his Vince to turn call now Calabrese, remarks. over Officer, the Chief our will Financial I for

I morning. good updates will XXXX. and financial for Gary, on the and Thanks, the results of focus offer quarter's Today, second remainder guidance

a and basis. Second quarter diluted share for $XX basis, leases spot quarter reported on net an $X.XX both shareholders On common at the income Bringing linked million $XXX totaled operating million, operating X.X% to to year-to-date $XXX.X billion, common available growing earnings and to or ended share. loans $X.XX quarter. per total

million, Physicians we cash for as duration The remains support and XX% available and strong leases to and loan HTM, redeployed spreads the quarter growth. securities at First billion mortgage years the from with even $XXX between seasonal portfolio investment from increased in portfolio slightly X.X with grew at to sale, The loans program. X.X%, fairly decreased quarter contributions of end. first improving levels. total with loans Consumer AFS $XXX million split to a loan a $X.X Commercial

partially mix shift quarter this due to impact the or deposits, the demand continued and decline at The quarter, deposits, the deposits of $XX.X a billion, linked of as interest-bearing primarily and $XXX in million deposit the seasonal payments, demand noninterest offsetting environment. of tax-related quarter macroeconomic outflows million million time $XXX Total -bearing customers in inflationary deposit X.X%, to $XXX million deposits. $XXX ended into decrease moved and

XXth, June at March XXst. noninterest-bearing deposits, XX% of demand comprised As of compared total XX% to deposits

pre of industry the While noninterest clearly the expect deposit above -COVID still banking deposits -bearing competition, to we accelerated mix demand to levels. total disruptions remain

growth million, loan stable ratio -deposit on net million, quarter, Revenue during our driven effect loan-to and tax seasonal diversified $XXX XX.X% and income, strong increased payments of our deposits. income interest to the reflecting of fee from $XXX businesses. benefitting totaled the by noninterest The

quarter's to Second X.XX% The yields due with was X.XX%, deposits on yield earning and with basis month the at points quarterly margin increased expected to interest assets X.XX%. slow, decline on to interest-bearing banks. was net of securities, June the higher loans, XX investment

X.XX% of cost funds deposits to as of increased points increased the XX basis basis points XX the to cost While X.XX%. interest-bearing

to quarter actively total manage XX%. We bringing to the data X.XX%, which ended deposit total at costs, deposit the continue our cumulative

mid-XXs. We expect to end the XXXX in

the solid practice reflecting in noninterest income dividends to decreased a services the first quarter. million, million, interchange due or F.N.B Dividends on level. XX%, increased production Service XX%, borrowings. the totaled million, of offsetting Turning seasonality fees, the from strong and to normal $X.X noninterest securities and expense, and million, first XXXX. quarter commissions strong in changes FHLB income increased due to that X%, implemented higher first increase $XX.X or X% $X.X overall or and Treasury $X.X quarter Management reflecting charges additional non-marketable fees Insurance overdraft

decrease increases the and mortgage quarter. $X.X strong to combined generate from management nearly with and XX% fee-based contributions, totaled the offset higher XX.X%, expenses. $XXX strong of ratio of that basis. employee The annual expense compensation in quarter, driven decreased continued commissions year-over-year given partially normal Noninterest merit better revenue expected efficiency first second equaled well-managed wealth occurred benefits up our by contributions on last businesses. primarily million, a the and Our quarter, or million, and in business than by banking million, X%, million, a Salaries from $XX.X from $X revenue seasonal

capital CETX remained Our quarter, targeted level. the ratio solid ratios a XX% at with our throughout

and maturity quarter higher investment which marks, X.X%, Our and when TCE our levels. adjusting ended remain peer to equaled median we expect for health the at X.XX%, than

$X We quarter per from share weighted during March June at average value X.X of $XX.XX. XXth, $X.XX .XX higher of shares for XXst, of share $X.XX AOCI, impact the was reduced Tangible prior level common the the book a $X.XX book compared from at by also to share increased per million of offsetting end largely quarter. the of increase repurchased price value the which tangible an at earnings,

at look end XXXX, to XXst, low with spot objectives guide maintain year-over-year. year now XXXX balance On digits the revised for to sheet. balances. digits mid-single full starting to balance the a our Let's the XXXX December is deposit loans basis, relative Total previous financial we down single spot increase

billion, and We to be XXXX become $XXX flat-ish $X.XX XXth levels million be third the between $XXX the of in with to should as of seasonality tailwind quarter year-end expected income million. a between to expect is year $X.XX net $XX.X to second half XXXX. Full interest June billion, level the of

deposits flat the then from to quarter largely currently week, assumes deposit of time XX guidance related The competition above point ratio of remainder a in pre-COVID our the deposits still for higher deposits. We Our rate a guidance demand remain and last noninterest for into next year. total mix-shift is to expectation driven -bearing to basis decrease expect strong for by hike betas continued

tied around Full expected to strategy. expected fee-based for expense is million, guidance $XXX $XXX quarter the million. revision incorporates million fee to due is upward commissions better of income expected to with largely prior end year year to $XXX million guidance noninterest on high $XXX the be the of benefit This of at between be $XX than Full our noninterest and third diversified basis income million, our expected an to to be operating income. higher

$XXX from to million third The net provision macroeconomic environment. growth dependent and $XXX Full remains CECL $XX guidance expense $XX noninterest loan is bills and to year related software model on is potential million quarter expected a be between to million million.

full the Lastly, not should XX% between the credit year, that to rate effective tax XX% be include activity investment tax does occur. which and may any

With back that, turn I call to will the Vince.

Thanks, achieved F.N.B. solid Vince. another quarter.

rooted conservative services, products stands our Our innovative financial in management, performance our culture because and and risk management. out balance suite of sheet of

All of employees. our this is made talented and possible dedicated by

in were impact performance. customers us on a cycles XXXX other showcasing our enables recognized Global on employees customer philosophy our cannot. America's State and our Forbes' Our to in feedback competitors XXXX based latter Banks business Best with in currently We ways award serve have through the

Our capital the position XX% loan activity with X.X% share totaling growth at from up CETX quarter. the supporting in The our grow, year-over-year. while and $X.XX value remains targeted tangible strong book operating share to quarter level continues this repurchase for

look the we to half to disruption drive year, uniquely As we the second and continue shareholder our on of positioned to capitalize value. poise remain to

[Operator Instructions]

from from Tamayo Daniel James. Our first Raymond question comes

of wondering where if sure any shift, could have if you're you. -COVID. more Thanks those end kind year? also guys. first, on you mentioned on of any they the guess my slowed kind the of if you pattern detail an was I'm just of comments taking morning, of for at the if up pre thinking pick a know you. assumption kind the into the noninterest-bearing balances, just there. end end there I just Did we And was it I cadence quarter explicit baked Good I land. on had little deposit I for the then about, Thank your you you not throughout question. within above had quarter, would might on up up mix guidance where the And that if heard

were specific at XX which not of remain would have XX, deposits we higher run, percentage short target down to through XX% line I to do kind handle, would to would here for a we we were need looking at the so XX October, move XX, handle or we pre-COVID, and that we period we noninterest-bearing we of migrate November deposits, We can mind, from is Yes, In mentioned seasonal say keep noninterest-bearing a be kind and of to affect a that because did that. target if in not from expect to as deposit, than the have kind forward. my down that build municipal item. the us

the years commercial, as to big growing well It's us retail, far XX, been deposits, it's company. And a here. business focus very as much see for as noninterest-bearing as municipal, XX help [inaudible], in small it’s it

move the happening what's the has that right? changed, deposit of was forward mix. second question the with shift so and part Yes, about And as we

CDs, the Yes, has definitely mean, side, ago. I quarters a I where the shift into still was it's rates few but from others' pretty matching slowed been heavy, retail requests mix it slowed. definitely would have significantly on for say it the

calling retaining the commercial as every due the still very But there's every with customer. I side, adding other think and would customers active done job we've nice you On very bank our expect in disruption a bank's to others marketplace.

the when relative strategy of And the our but calls, to show know on part in to on the customers. consumer deposit our the that client focus small is primary to primacy bank paying particularly that business noninterest-bearing The by for Treasury Services supported are base, be and with flow accounts. well this, to has others the very noninterest-bearing category, said I've mentioning keep particular, deposit numerous reason Management balances as going look is and you and compensating our because, embedded exist been balances performance think I we for I at base,

job continuing helping I people think we, of pretty support our our noninterest-bearing that's have what's base. a done good and us really deposit So that,

margin everything a the quarter. through down thing with proof too, margin, a in quarter, did April happening and The you far look March If at down the during the if from I from all June. would basis the points margin three to to were including slowing April, we level, for kind March, went our banks nine then purposes to as mix that of the add, we the other went as to definitely X.XX from shifts May three and May points basis point

there's runs that income. been net statistics a also margin to through the interest So impact the clearly, slowing

And great expenses. color. here maybe my all That's question, on appreciate I second that. for just gears changing

of wrong get the quickly, assuming here, quarterly or mark X.XX through Just guidance year, rate, that the the the and we around maybe, so. of top curious run just implies kind I'm at the if

you line. any reduce given So to if top opportunities going on the of kind see forward wondering the expenses pressure

the to we I and for going those have in day clauses that things quarters. vendors cost expenses rolling as over that out. have through contracts out inflationary we'll targets something and continue it's take quarter renegotiating I times. excess improvement with particularly impacts, to mean, to $X there. year, At have there. every year. we have to expenses, those not mean, in run, the meaningful we company Process contracts million, whether CPI opportunity year continues a significant We've switch savings a the kind that had it's get ratio, there's increases we there's of the fifth or to every renegotiating manage it's big just target at efficiency previous But kicked back is of contracts, fourth of at year. so look this we been is some having on XX% actively savings our We're to where CPI cost keep for us be like cost one focus so throughout,

just the to of pursue managing of we're we're a optimization, ways quote. expense constant We're disciplined, space and Danny, facilities, our is day, kind every to it's optimize So side it. continuing which

of So day. baked what is extra into every kind do something we that

Fargo. Our next question comes from Jared Wells Shaw from

of conservative by mid-XXs number. like Maybe Braziler I is prepared points seems this a filling that for with beta beta for mean, mean, Jared. pretty increased percentage just end. deposits quarter. I in by following remark year kind that on Hi, commentary line of up good morning. This the of Timur

of there following given lag any hike is assuming one kind assume Or of If rate last there's done deposits kind hike? Fed that be have to once your here, that barring expectation that the the more an how you're additional of element going so well performed is just some far we should a

is kind shift, of well? the going to cost mix slow as

Yes, teams the effort change the side especially and is to an quite rates. and of balancing post costs I side continuing in raise there the failure act an Fed with in mean, would continue the environment, [Tech to our deposit on I company say, been managing our I retail challenging has throughout think commercial Difficulty] the

the to happen that next I one in move mean, don't everybody with I just think it February, I more expects think February week, that stops.

I little think mentioned commercial there's, be retaining deposits. done sure to our there deposit a bit for as earlier, a the continues we've lot side I of and retaining competition great job a and customers on

originally some XX, So that think happens, for if that. XX beta but the probably was we mid-XXs, there in of there's time. should we, some a of couple it April higher at I go kind midpoint of the I through guided used period carry of mean, times it so to But it on than

know XXs and It'll low what that's in that the us figure great. So we that we're feels than can we and April. the for based mid-XXs, higher reasonable But guesstimated, forecast think on I it how we be now say, I better. would managing our do kind of in a

resi? of maybe First or this run what's cylinders. the to then the right going we book. is And Resi to program growth resi shift Physician mix refi now? the ahead, more much then purchase? on loan the almost A, as kind you're loan is who's switching growth How look Number And of mortgages the of and forward that fire gears guess just expecting? this Is the I continues I activity? room loan in there now XX% on mix to growth. guess approaching of two Is all great. taking questions. one, kind Okay,

that that credit the their they, that Well, well borrowers So business to all, purchase I've, established are are program we best First the upgrading be the money. first are Physicians of is Most home. do of in of it right? our physicians tends some profiles,

has footprint as our we just purchase strategy. vast little the across I historically kind So entire expect focus the That's been a of First, we’ve but skewed majority, would move our been towards bit. not changed Physicians money. forward,

So to The Physicians that saleable sheet loans tend balance we're be producing oriented. First product. more

sheet. rest So of of the moving, the in moving more which direction been producing help we've has the saleable should us book the been product, manage balance

and the aware the move we As perfectly of adjusting. comment about we're concentrations forward, capable

could that money. we monitor and on And eStore and the services here circle of origination. multiple but also game quality overall, we sales it is group, make And to avenues, I think include the front concentrations. why the high particularly wealth is end we or developed management. That's to very sure purchase other that products But offer particularly back to borrowers,

we the have We end quality look with the And practices getting brokerage, acquisition then up the high based, insurance, Services for build to fee business facilitate Treasury of offering businesses. and fee-based we practice. opportunities and side help loan also at, Management products on out

over time. those Drive

Which well. time as drive over those

find much goal are that’s into growth, given been our and say do versus to has on originators recent that, production. strategy the new relying purchase I’ll the home activity to networked focus So for market refinance pretty their with mortgage really our

at that's it how looked So we've for a long been time.

down, here of up today, but it's XX% refi. were virtually little mean as come so again purchased, purchased. when That'll sit rates the originations pick we very I all

due out additional of next. Is be through me, to sort just you of element right this are event everyday going that to for Are theory you're this book, expectation of nothing aside is there, of proactive allowance coming of Okay. your change? more loans, an this maybe broader putting change kind sentiment We're of the in this really this where kind year, or usual and now some with last or of wanting one credit all Are ‘XX. reviewing I the and in as Gary. or year there proactive? credit with event, does kind be you're reviewing maybe And you, trying period as as everybody's expecting does loan of know sort loans? then the you're for guess end some all I the more anything business it review for those loans back

changes. Yes, two that tell in move We're more. I doesn't from change and aggressive managers, really you economy. very risk mean, for the nothing our us, program I would a

by office the to going the the going book portfolio continue in with manage real as space are loan no about book our some at to management in change this But in risk issues we're cases, talked on far So we've that as as concerned. practices loan point.

ahead to important continue which our perspective. from it, is Just stay of

question from Frank The next comes Schiraldi from Piper Sandler.

Good morning.

Just think a on Vince, right couple you're me, target CETX kind of, for capital. your I at of you noted ratio.

AFS assume if size priorities in model. could I larger the the down Just buybacks ratio that's some growth. dip I you for that see And than had would a of kind that more of than a share about you in wondering of including wondering just your bit rules. given the those, aggressive there we of my in bit banks maybe guys book, changes the might little bank, capital here, out concern were see through a But CETX guys little less

point you buybacks? how here. this about wondering Just on at Is it more opportunistic just it think

the well XX% mean say for XX.X, operating Yes, I quarter, as as as to key an to kind opportunistic, we But where for would earnings the trading, So not I given stock strong going us. was manage the XX.X word. at we're target We're of established the quarter. every Frank. we've right mentioned, that that's you it is

continue the were through we'll go we yes, year. as we to opportunistic opportunistic, be So

ratio we're slide it, ratio, reported When we least marks. added of in a we we've CETX here at If think right, the versus we with add XX.X kind X.X you peers. I AFS the has and at then X.X, TCE versus have see ratio, are you and in added and AFS, And can for March, then the XX.X, HTM at looking and look were the you X.X X.X. CETX at

So And see on those TCE levels all than X, you there. slide similarly, on the and the are better ratio, can, you comfortable impact peers. can

still be balance very that strong with profile, opportunistic. supported given The I risk and comfortable us we're enabled the generation XX%. then the growth So our mean, to asset earnings it sheet,

model We we're And of where on we kind growth slower loan always in there's going And to is year or we'll expect the accurate. be a the what's half in the then of gradually our put then bit loan build more as growth current based than opportunities CETX to support money forecast. do. to first, if second the our little

All right, then mentioned to deposits, seasonality you the dollars. up just follow And great. deposit the the on of Okay. Muni

wondering, purposes, past of you expected remind the rest Just help book. in size modeling kind just to those of relative with maybe can if flows costs, the those for us and of the the the

then Yes, I $XXX of mean and through kind first we the the in the to of up for from October piece in a million million $XXX timeframe. quarter trop, usually flow kind use normal down the - November

on where pricing. we're specifically about those. haven't costs talked disclosed We We've

that there, X.XX% for we've out May XX-month that kind rates of instituted We a for X% XX-month and promotional have a are CD in CD some CD.

will new about we've of so of in too. May. advantage money take company of customers $XXX so about brand that some the generated And CDs million that two-thirds beginning since It's and far, municipal the the to of being

right, money provider. hot with Treasury the them every, almost us. not Management We're In we're to primary just raise permitting

it's less this those point amount So the other that And into that of collection particularly at increases in go valorem higher-cost likely seasonal, there's and they'll migrate with are ad Management Treasury that on products. time. if fees activities tax seasonality,

operations. tend in So increase cost cover more to that of leave demand they the deposits to

portfolio. on of with just into flowing that money and out It's in a not there's things high So yielding. going lot

Okay.

guess some I of So that will come noninterest as bearing. in

to not. kind kind next for us quarter, of way noninterest-bearing going trend impact maybe of really to if that big curious in see Just enough kind it's it a of but

folks investment can decide it's It's think credit balances rates free a they based rate bit upon a earn entities hard say, get, or to managing don't going earnings those the dramatic from those to what of and investing. whether use I type though, at have impact. to balances

high part basically not yielding buyers, what clear costs we to so. wanted all that's do that of of I but we're just taking just make So not it, it's the

the of I through come bulk really the side. referenced will And GDA money

Yes.

taxes. the tax, the They collect increase

that'll noninterest-bearing line. through close So the paring

that. Just clarify

next Our question comes KBW. Perito Michael from from

this everybody. but now is be that the would the hope of able if proves accurate point? think CD cools here, Obviously, most for something right how forward competitively, that memory, a forecast margin been I rate might I wanted start, taking just and to be here, to little little Hey, color in incremental quarter color, turn Thanks tailwind? that forward, And kind you does us admittedly your point growth, could as experience on kind or roll in ahead to off your you recent morning, rates guys from memory, uncharted at type guys was kind about lower? question as of if my headwind good we probably but the competitive look curious some wondering dynamic for if you more the would about you of give but that it's are a the this the next questions. so territories of what of year be what's environment early duration. that think to And you at in CD moving a that to

Mike. it, that's Yes, think how about we exactly

months now. So is term X are we the of mentioned XX average right have specials I that XX CD and that portfolio months months The the two CD.

said, to but reprice an So have if mid-year, The half next second being like rates of now, there year, come down lower. idea you those very start opportunity to short. competitive that, we very it's

the So that's strategy. exactly

of is geographic. then of storm at industry, Got all both the have about think it. in think guys as I disruption the so one least of line guys And franchise, that well reasons, the you the in the just business, diversity weathered the opinion, my you just

some well-respected around. that really had You no are longer large, players

and business ‘XX large guys be where there's market at share your forward niche businesses are private is strategically, there mindful Just or be these these should maybe growth that pulled about that banking of on in roadmap other might that the think anything or ‘XX banks new we we as on opportunities? looking that you had side opportunities, some like in small of

pursued have interested that I other specific said in. different. a long ago, don't line would were we We’ve we I mean, right. think there's always that that would we business be banks from

our to relative We least banks have compared of couple right at that ago. those years range a size in are been

peer, they against were group, peer them were they by analysts. So benchmarked in our

kind was go again. the and I've time, you model what earnings over different to look said do over consumer consumers. program, old relationships in the small we focused the midstream which We focus building First consumers. than of effort. do. Physicians their think at we it spectrum transcripts, to middle of income I consumers, if a on have is and have said on tend and over But vastly handling private market, back that broad We We business. We the higher banking cater do

doesn't that’s so portfolio. risk diversifying said And and this capital earnings with of team, deposit us Then that we the think Gary, whole That businesses. consumers consumer of focused capabilities focus. concentrations risk said are very strong by the I spends if team, really, a on Tom We with back been broaden help time, analyzing the happened, we at lots returns granularity product go all tried model, I We on sound we've that base. within a that that's in and before franchise even like geographically. investing granular repeatedly. transcripts there's but the our that to deploy sexy Gary look you a his Fisher, manage very

quite of to paramount really very favorable. frankly, And bank. a valuation is was think mix I the that deposit Our

you I base. value the deposit think want to actual if you're at going of their look to evaluate an institution,

with do changing. us I right. they So really businesses are I exit, think, well, as I our don't the in see think

those competitive So the exit will a help us. from perspective players of

from high net it from doing will the to disruption. be to able commercial markets, in perspective, certain individuals, loans lending wealth benefit worth think a I

opportunity too? to pick course bankers up Of

we've no was so us all Hiring historically. people, time issue reach Actually, attracting Absolutely. talent. people had and way it out that's not the to the

I think puts compete in why power move I strong to said conservatism really in the as That's cycle more our and it a comment us staying effectively. in position. we my through

great capital I set. think before I it in capacity, And and it a have I'll put product it from say said a, again. We to

in on. very is for It's to services a through investment and technology, focusing our for on efficient us that ability us, purchase way. multiple in we're think improving I what products clients spot the

why consumer are. and on we the as to up eStore they So the as focus much are continue applications that's

us multiple deposits be add one and services consumer. one we as in a with because easy accounts platform, think to help open new platform that I It'll on to purchase really November products get going to that's really and depository application.

So – experience that's and clients. better think, the for the we Anyway, put a most part, as the digital make that we place in I exciting that's move It's forward. AI tools to using

No, on color. M&A more about maybe if find then bank guys. some or the to apparent that's Vince. next be of the consolidation helpful heels there's you, last willing thoughts that just me. was question I pretty curious of this mean, phase were it's you I going Thank some event. share And for just really here, to

Just comment consolidation this just an what it on next of there, at that opportunity maybe current you out could think slow mean juncture, kind and but headwinds for standpoint, what all. you're iteration seeing at very of curious, from also a seems regulatory if F.N.B

a on a I calls point. be going say Well, is are to lot a to to be this Everybody any of But time because want one be struggling might an a good are I banks banker I comment the banker. future the of comments. I'm an investment that there investment made of for that it variety reasons. sarcastic not at in freezing make wouldn't will

think other think end, out will the I move through there we're we yet. things As cycle, don't at. look there we I come to be when this

have returns that. accretive that tangible value That's saves expects. well that cost be the forever. board now, to are to get sticked we the strategy cost internally deals and I'm earnings could we've in are that our, where tried of I immediately focused in-market very and are, very that That's not on kind M dilution we focusing on were what disciplined active capital &A, of true We're to we're limited book said right around we've think if and we suggesting capital. and above of our

shows it think I that in our to strategy. performance that true we've stayed

from I that works would market perspective. to financial perspective, that lot think but still. sell deal challenging M&A There's is a don't I the a banks like probably mathematical current themselves, the know very of

channel, ITMs. with we've that channel So and the principally I our deployment on that across of the out ATMs eStore augmenting mentioned, and our building footprint e-Delivery been then seven-state focusing

to push doing ATMs, feel we've that. we very way And then some that's us delivery cost-effectively, So customer digital that go with to the had in our ATMs, better base. branded that products a good for physical bridge success channel our and

the de focused so. novo of going Anyway, on event. and continue and M sarcastic view So stay we're and to that deployment my to &A. strategy consumers ATMs on small business drive that's headlines No

Stephens. comes question from from Gunther next Russell Our

Hey, good earlier. follow morning, made I wanted up to that Gary on comments guys.

were quarter. Just elaborate that's share company-wide of on. assumptions could year. time it you like into kind able It price declines, some just CRE assumptions, some be guys you if that stress broad the to to anything would strokes do would performed test every something be went sounds helpful interesting get particularly this the you It around this of you

review. forecast, Russell, little provision in than test result our much perspective, they of terms from perspective. came a higher the lower And the the in From past economic a around did a the it's little pretty review, normal Yes, stress forecast. assumption charge-offs

covered ACL, a in those case than it worst In losses nine-quarter the potential terms XX%, of scenario. by more

review, came prior we better than So expected the and better pretty do which we on regular review. a just standard out a it basis, and than

Then portfolio. gears my here last on just That's question helpful, securities Gary. switching for Thank the you.

of you back any of some might If willing be that? what to stomach? Just guys to type earn So restructure appetite

I gain. and would say, that, historically, a at sum we've looked zero I mean it's

XX the that that cash we're rolling next off re-investing That's a XXX, flows the kind of today at in So healthy this and over $XXX $XXX portfolio of months, Almost we level. portfolio. at we like million pretty have, and level. million about XX%

So job so The portfolio little million first So where given million if of a the to flow the and today, invest the portfolio. to our nice very quarter, million. the the to the Scott I the funds or of re-invested attraction are And we every it into extension at so did continue growth shrink need structure in million, quarter, invested risk think Last fund $XXX his we quarter will It's have $XXX don't and of thirds today. $XXX team, cash but second is you here we the mean flows, two portfolio bit, about done with team loan $XXX there, there risk. opportunistically month. for opportunity some there. have was quarter, a a or cash the I portfolio, significant creating we we

about the we to is portfolio as it was opportunistic of Again, end the kind will as being level the we of plan ahead, invest. so look forward. we the As be June general where hold same at go

to far, $XXX work So $XX been we have million three for put able to million years at duration.

us. strategy of So I a portfolio good and sense sound a I portfolio makes lot the for strategy think the is of the think

DA from Navas Our next comes question Davidson. from Manuel

morning. good Hey,

borrowing and update kind Just more little laddered bit gave process? kind a quarter. and an give stand follow a you where you you up that, know of you I little on and on it with last had to of of can color the bit decision out kind making

the on stand Just you borrowing want sheet kind of the balance today well. to and hear with cash where as with

from that our regularly. that. it to kind timeframe affected went statistics talk talked here March $X.X that we in to sit today, margin about. occurred. I the I still what March would of net of mean, timeframe the excess We a billion goes have But to of about call given said, of that that as NII push interest disruption We down on the put cash. market kind Yes, I Like about April a I dollars we that that

billion, right, now, For to $X.X going Scott? we're keep

The growth the more decline year, and seasonality. gain doing bit of it If jump consumer half purchase the on might like growth to back business. comes consumer down Okay. for also a perspective you're I bit, the on sale back is loan seems side as a on the across

do kind trends what outlook right you and Just commercially? then on of there an what think the are now

up, than is think to the bit slower commercials a off mid-Atlantic Yes, along. board. is is But and been the experiencing up little has why I it slow, do think a South think in our XX% This the really the guide provide the slower. but I year. slower then like diversification solid for us, still about right? end the our years, helps elevated our we're a it hit Because year. just opportunities I Carolinas, pipelines But where nailed and we're mortgage past. activity geographic but I the it Baltimore previous the think of with expecting Cleveland are the to little guide little good reaffirmed mean, book. enough Pittsburgh Pittsburgh in the a across DC us than little the pipelines, that's still, Good to it's on you towards and I are tail substantial Pittsburgh and we still experiencing, said, is chugged I activity. is

So right we're where little better then. going halfway up about feeling a to so end through we're we're here,

So anyway, that's look. kind of the

in we're Obviously, side. player I office large are think not slower. large a not little a really probably on more there's from player CREs perspective, we're the C&I Again, space, a there. C&I activity a office, the a little urban

But different we're thing, that's others little seeing is where chased. but are. we may a what So have

the portfolio there success size any current on kind or of that the Physician like First updates cross-sell possible that could you of share? and on anything What's is

grow. have the to Yes, of in $XXX continues portfolio It total. to I share front I don't That have me, but don't statistics at -- million exact in north hand of with number was you.

like around of First billion portfolio. $X.X it's Yes, Physicians

referencing we on hold balance I'm larger. our versus We globally. That's what program sheet. our on originated sheet our in what hold we balance

outside -- That's just of

the Physicians in not just program. revision whole the That’s and space, Physicians mortgage yes, First

we we're as a program total million. the, I to specific to the product. $XXX going be forward our on through Originated be But saleable think think So $XXX focusing be about more again, would I million move billion. $X.X portfolio would

really the terms of so in surface And don't we to our So started should able we after go bring now opportunity, balances just we I scratch good how customers sell be to down. have, originates have to those We're November come of add a those products, when what's for depository the early statistics And particularly mortgage eStore. the with when in somebody going loan, very products you. aggregation happen we is the on, out

same and Physicians application. going loan to come on First consumer be other until will going Insurance loans little deposits isn't insurance program, time and there the but be to through able purchase end they're to November. platform end one and at products later, even depository with to the one the by a

door Physicians dealing year, I for products talking out this the about our look, loans Yes, XX% so. multiple with mean made we're have plus

great. quickly. like is, a given NII of But guess do that, early that next that your rate And around I thoughts NII and, That's next hypothetical NIM What year? we very could bottom kind little assumptions, my giving can think out this last NII question a change we is as see given that of bit guidance, and is year? for

factor on to quickly. have, them of Yes, there say quarter, based see kind grow is it those and I said, to then right, today, can to that of what And would we to say, first probably on key things. thinking. we you there. NII like I over help kind we'll And a start forecast what current build is would fourth growth we're of and bottoms I the and change our in mean based that in first earning asset fourth Obviously, kind margin the the

see So kind where kind out. would bottoming that's of we of things

Martin Brian comes next Montgomery. from from Janney Our question

the one of the on like and margin. be forward should the the slowing of morning, Hey, margin answered cost guess less good sound rate just loans margin, the more going does and funding pressure stuff the to with there march impact less. guys. is was Most I just Vince. so pace that of my the But

are you tailing and margin more your be, quarter, quarter first the for in to like how So be that rate bit on in then off, the given of bit should outlook quarter it of the rates? would in about quarter, a if this think maybe the first less trooping is it decline kind

I of I last say, month, Yes, basis mentioned three couple mean, the the I a months. points would

know, probably four would I in So which our guidance that, to a into be month. baked three don't

quarter. XX points it much that in a fairly the to come slower will We through probably down about pace second was than first basis the

fourth what's then then bottoming in So that's built starting to baked Brian, first, there. guidance. that in our And and into slowly

you. Got

general, quarter. for just bit the the on the in contraction, deposits a know deposits seasonality as bucket. quarter far the grow this here? that guidance liquidity kind but just bit growth will but deposits. aggregate, Yes, mean, outlook deposit about, noninterest-bearing maybe seasonality talked you being just of year, I and part know noninterest-bearing on you then in just you full expectations, I the your I this and about on not just gave keep, you lower, liquidity of your thinking And Okay. those about as maintain if the the as deposits talked a What's you

the HX mean, show far out with read Yes, given I've aren't And prior through look changes the and, so very year we all think the of municipal is better at versus well. flat the the end decreases think of I out those in things from the is end think what at that so. the the deposit data, flow of are stuff noninterest-bearing sure some I to if of I you our data, there but for deposits compared to quarter just I our, kind commented the mean, on peers I the yet, our

Yes.

What's at the as for bit. you kind fund that of holding liquidity? a And just liquidity growth that actually, loan on opposed Okay. thought using to just outlook look on your the when it maybe to the you

is. to just basis we're earning great. mean, mean, X.XX for we're really points it, Yes, it Well, now, right, I that Scott? hold it, Brian, XX I on going where

to said, it set to now hurting billion. we And deploy really $X.X it's I keep us NII but We're and like not standpoint, it's environment, it's costing going maintain an not I to it, date. going the all a just for start time. don't have that So to we're from given Scott the asked us.

got to. you Yes,

are continue current the like are buyback I If conservative type earnings could and opportunistic? the take forward, the of is after And maybe lower if two loan side, stress up got maybe guys was, think still, the certainly to of expecting there I the you've repurchases a of a you're with is bit the willing level the test, fair near buyback, be for kind but about the conversional pipelines growth, sounds to credit going capital, the the it on Okay. something that you term. the last maybe a how bit, guess to quality this guess tepid

the is still And could opportunistic. could a loan in plenty more really a become slower active. that's used if still of think authorization I be little under what's we From the by. authorized than $XXX word. of growth key and our capacity capacity forecast, we million It's our have standpoint,

continue to shareholder be opportunistic. to make do that. And and we interests manage we'll have So we'll We'll that. continue sure to

maybe Okay. the one. this then, And last is

Any your through think, the test, doing, I changes there? last you've if after updates you've that quarter mentioned might some on you may on making you on office things. side. sales to guess Still I occur? Gary, think stress sales kind of gone guess the any potential about done outlook might, that selective I that? that you

we Brian, don't at anything Q have our the moment. in

is nothing later that a always So have teed part really, action. up for we It's sale. really our that quiver take to of year

category through needs into anything But of at I'll look continue see nothing now. as the year. we'll to we be the the if year. that before right So to move that put end here

over back question-and-answer our the concludes This for remarks. closing to turn any to Delie Vince conference I'd session. like

like looking our year. the I'd continued for to questions, their We're for shareholders the support. interest second the and thank of F.N.B, to just the everybody forward thank for in half

through times well. and some are for employees dedicated like very got opportunities I to our everybody. them to dedicated And think who and as engaged so that's also they've I great times, always wanted there's execute and I Well, everything I'd perform for thank And Thank good us well all employees. us to where get difficult we've have. done. thank you,

now has concluded. you presentation. for Thank today's conference attending The

now disconnect. may You