First Commonwealth Announces First Quarter 2024 Earnings; Increases Quarterly Dividend

Published

INDIANA, Pa., April 23, 2024 (GLOBE NEWSWIRE) -- First Commonwealth Financial Corporation (NYSE: FCF) today announced financial results for the first quarter of 2024.

Financial Summary

(dollars in thousands,For the Three Months Ended
except per share data)March 31, December 31, March 31,
  2024   2023   2023 
Reported Results     
Net income$37,549  $44,827  $30,224 
Diluted earnings per share$0.37  $0.44  $0.30 
Return on average assets 1.31%  1.56%  1.17%
Return on average equity 11.40%  14.11%  10.56%
      
Operating Results (non-GAAP)(1)     
Core net income$37,639  $44,964  $45,387 
Core diluted earnings per share$0.37  $0.44  $0.45 
Core pre-tax pre-provision net revenue$50,833  $55,028  $54,481 
Provision expense$4,238  $(1,865) $(2,650)
Provision for credit losses - acquisition day 1 non-PCD$  $  $10,653 
Net charge-offs$4,302  $16,338  $1,173 
Reserve build/(release)(2)$1,380  $(16,619) $30,979 
Core return on average assets (ROAA) 1.31%  1.56%  1.75%
Core pre-tax pre-provision ROAA 1.77%  1.91%  2.11%
Return on average tangible common equity 16.51%  20.78%  15.75%
Core return on average tangible common equity 16.54%  20.85%  23.42%
Core efficiency ratio 55.05%  53.00%  52.41%
Net interest margin (FTE) 3.52%  3.65%  4.01%
 
(1) Core operating results are a non-GAAP measure 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. A full reconciliation of non-GAAP financial measures may be found at the end of the financial statements which accompany this release.
(2) Reserve build/(release) represents the net change in the Company's allowance for credit losses (ACL) from the prior period.
 

First Quarter 2024 Highlights

Financial results

  • GAAP Net income of $37.5 million and diluted earnings per share totaled $0.37, an increase of $7.3 million, or $0.07 per share from the first quarter of 2023 and a decrease of $7.3 million, or $0.07 per share from the prior quarter. The results during the first quarter of 2023 included $19.2 million, or $0.15 per share, of merger-related expenses and day-1 non-purchased credit deterioration (PCD) provision from the Company’s acquisition of Centric Financial Corporation (Centric).
    • Core pre-tax pre-provision net revenue (PPNR)(1) totaled $50.8 million, a decrease of $3.6 million from the first quarter of 2023 and a decrease of $4.2 million from the previous quarter. The decrease from the prior quarter was primarily as a result of a 13 basis point decrease in the net interest margin (FTE)
  • Average deposits increased $51.7 million from the previous quarter, or 2.3% annualized, including a $169.6 million increase in average time deposits offsetting a $132.2 million decrease in noninterest-bearing deposits.
    • End of period deposits increased $254.1 million, or 11.1% annualized from the previous quarter, including a $186.3 million increase in time deposits and a $113.0 million increase in savings deposits offsetting a $54.0 million decrease in noninterest-bearing deposits
    • 82% of deposits were insured or secured as of March 31, 2024
  • Total loans increased $33.2 million, or 1.5% annualized from the previous quarter
  • The loan-to-deposit ratio decreased 228 basis points to 95.6% in the first quarter of 2024
  • Net interest income (FTE) of $92.6 million decreased $3.4 million from the previous quarter and $2.1 million from the first quarter of 2023
  • Noninterest income of $24.0 million decreased $0.3 million from the previous quarter
  • Noninterest expense (excluding merger-related expense) of $65.5 million increased $0.5 million from the previous quarter
  • Tangible book value per share increased $0.17, or 7.4% annualized from the previous quarter
    • AOCI as a percentage of tangible common equity increased 53 basis points to 12.58% in the first quarter of 2024

Profitability

  • The net interest margin of 3.52% decreased 13 basis points compared to the prior quarter
  • The core efficiency ratio(1) increased by 205 basis points to 55.05% compared to the prior quarter
  • The core ROAA decreased 25 basis points to 1.31% compared to the prior quarter
  • Core pre-tax pre-provision ROAA(1) of 1.77% for the quarter ended March 31, 2023

Strong capital positions

  • On April 22, 2024, the Board of Directors authorized a 4.0% increase in the quarterly cash dividend to shareholders
  • Bank-level Common Equity Tier 1 Capital (CET1) ratio of 11.1%, which represents $435.3 million in excess capital above the regulatory “well capitalized” requirement of 6.5%.
  • There were no shares repurchased in the first quarter of 2024. The remaining capacity under the current program was $17.4 million as of March 31, 2024.
  • On June 1, 2024, the Bank will retire $50 million of variable rate subordinate corporate debentures with a current interest rate of 7.45%. This will reduce Total Risk Based Capital by approximately 44 basis points and improve the net interest margin by approximately three basis points beginning in the third quarter of 2024. The Company expects to incur approximately $360 thousand in other operating expenses in the second quarter of 2024 related to this redemption.

Asset quality

  • The total provision for credit losses was $4.2 million, an increase of $6.1 million from the ($1.9) million provision for credit losses in the previous quarter.
  • Reserve build/(release)(2) was $1.4 million, which brings reserves to total loans to 1.32% of total loans from 1.31% in the previous quarter
  • Nonperforming loans of $42.4 million increased $3.0 million from the previous quarter
  • Net charge-offs on loans totaled $4.3 million, a decrease of $12.0 million from the prior quarter, which included approximately $12.0 million of net charge-offs for loans specifically reserved for in previous quarters
    • Net charge-offs as a percentage of average loans outstanding (annualized) was 0.19% in the first quarter of 2024, a decrease of 53 basis points from the previous quarter

“We are pleased to report another solid quarter of performance, highlighted by our strong pre-tax, pre-provision return on average assets of 1.77% and return on average tangible common equity of 16.51%,” stated T. Michael Price, President and Chief Executive Officer. Our commitment to disciplined financial management and profitability remain our primary focus. And we are confident in our ability to navigate the evolving economic environment and deliver sustainable value for our shareholders.”

Earnings

Net income for the first quarter of 2024 was $37.5 million, or $0.37 per share, compared to $44.8 million, or $0.44 per share in the fourth quarter of 2023 and $30.2 million, or $0.30 per share for the first quarter of 2023.

Net Interest Income and Net Interest Margin

Net interest income (FTE) of $92.6 million decreased $3.4 million from the previous quarter and $2.0 million from the prior year quarter. The decrease from the prior quarter was primarily due to a 13 basis point decline in the net interest margin.

The net interest margin for the first quarter of 2024 was 3.52% as compared to 3.65% in the prior quarter and 4.01% in the year ago quarter. The decrease from the prior quarter was primarily due to a 19 basis point increase in the cost of funds only partially offset by a 6 basis point increase in the yield on loans.

Total average deposits grew $51.7 million in the first quarter of 2023 as compared to the previous quarter. Average time deposits grew $169.6 million and the cost of total time deposits increased 40 basis points from the prior quarter. The increase in time deposits was partially offset by a $132.2 million decrease in average noninterest-bearing deposits.

End of period deposits increased $254.1 million from the previous quarter, including a $186.3 million increase in time deposits and a $113.0 million increase in savings deposits, offsetting a $54.0 million decrease in noninterest-bearing deposits.

Asset Quality

Provision for credit losses totaled $4.2 million in the first quarter of 2024 as compared to ($1.9) million in the previous quarter. The increase from the previous quarter was primarily driven by net charge-offs.

The allowance for credit losses (ACL) as a percentage of end-of-period loans was 1.32% in the first quarter of 2024 as compared to 1.31% in the previous quarter.

At March 31, 2024, nonperforming assets totaled $44.3 million as compared to $40.9 million in the prior quarter and $45.2 million in the first quarter of 2023.

Nonperforming loans represented 0.47% of total loans as of March 31, 2024 as compared to 0.44% and 0.51% for the periods ended December 31, 2023 and March 31, 2023, respectively.

At March 31, 2024, criticized loans totaled $211.9 million, an increase of $1.7 million from the previous quarter.

During the first quarter of 2024, net charge-offs were $4.3 million, compared to $16.3 million in the prior quarter and $1.2 million in the first quarter of 2023. Net charge-offs during the prior quarter were primarily driven by acquired loans.

Net charge-offs were 0.19%, 0.72% and 0.06% of average loans (annualized) for the periods ended March 31, 2024, December 31, 2023 and March 31, 2023, respectively.

Noninterest Income and Noninterest Expense

Noninterest income totaled $24.0 million for the first quarter of 2024, as compared to $24.3 million for the fourth quarter of 2023 and $23.0 million for the first quarter of 2023. There were no material securities gains during the current or comparable quarters.

The $0.3 million decrease from the previous quarter was primarily driven by a $0.5 million seasonal decrease in card-related interchange income and a $0.5 million decrease in commercial swap fees, partially offset by a $0.6 million increase in gain on sale of mortgage loans due to an increased mix of sold loans and a $0.3 million increase in gain on sale of Small Business Administration (SBA) loans.

Noninterest expense (excluding merger-related) totaled $65.5 million for the first quarter of 2024, as compared to $65.0 million for the fourth quarter of 2023 and $62.8 million for the first quarter of 2023. The $0.5 million increase from the previous quarter was primarily the result of a $0.9 million increase in PA shares tax due to a release of accrued tax obligations in the prior quarter and a $0.7 million increase in occupancy expense. This increase was partially offset by a $0.9 million decrease in salaries and employee benefits due to a $1.3 million decrease in hospitalization expense.

The core efficiency ratio was 55.05% during the first quarter of 2024 as compared to 53.00% in the previous quarter and 52.41% in the first quarter of 2023.

Full time equivalent staff was 1,465, 1,475 and 1,536 at March 31, 2024, December 31, 2023 and March 31, 2023, respectively.

Dividends and Capital

First Commonwealth Financial Corporation declared a common stock quarterly dividend of $0.13 per share, which represents a 4.0% increase from the previous quarter. The cash dividend is payable on May 17, 2024 to shareholders of record as of May 3, 2024. This dividend represents a 3.9% projected annual yield utilizing the April 22, 2024 closing market price of $13.29.

First Commonwealth’s capital ratios for Total, Tier I, Leverage and Common Equity Tier I at March 31, 2024 were 14.3%, 12.2%, 10.2% and 11.4% respectively. First Commonwealth’s current capital levels exceed the fully phased-in Basel III capital requirements issued by U.S. bank regulators.

Conference Call

First Commonwealth will host a quarterly conference call to discuss its financial results for the first quarter of 2024 on Wednesday, April 24, 2024 at 2:00 PM (ET). The call can be accessed by dialing (toll free) 1-888-330-3181 conference ID # 4651379 or through the company’s web page, http://www.fcbanking.com/InvestorRelations. A replay of the call will be available approximately one hour following the conclusion of the conference by dialing 1-800-770-2030 and entering the conference ID # 4651379. A link to the webcast replay will also be accessible on the company’s web.

About First Commonwealth Financial Corporation

First Commonwealth Financial Corporation (NYSE: FCF), headquartered in Indiana, Pennsylvania, is a financial services company with 126 community banking offices in 30 counties throughout western and central Pennsylvania and throughout Ohio, as well as commercial lending operations in Pittsburgh and Harrisburg, Pennsylvania, and Canton, Cleveland, Columbus and Cincinnati, Ohio. The company also operates mortgage offices in Wexford, Pennsylvania, as well as Hudson and Lewis Center, Ohio. First Commonwealth provides a full range of commercial banking, consumer banking, mortgage, equipment finance, wealth management and insurance products and services through its subsidiaries First Commonwealth Bank and First Commonwealth Insurance Agency. For more information about First Commonwealth or to open an account today, please visit www.fcbanking.com.

Forward-Looking Statements

Certain statements contained in this release that are not historical facts may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, notwithstanding that such statements are not specifically identified as such. In addition, certain statements may be contained in our future filings with the Securities and Exchange Commission, in press releases, and in oral and written statements made by us or with our approval that are not statements of historical fact and constitute “forward-looking statements” as well. These statements, which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of words such as “may,” “will,” “should,” “could,” “would,” “plan,” “believe,” “expect,” “anticipate,” “intend,” “estimate” or words of similar meaning. These forward-looking statements are subject to significant risks, assumptions and uncertainties, and could be affected by many factors, including, but not limited to: (1) volatility and disruption in national and international financial markets; (2) the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board; (3) inflation, interest rate, commodity price, securities market and monetary fluctuations; (4) the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which First Commonwealth or its customers must comply; (5) the soundness of other financial institutions; (6) political instability; (7) impairment of First Commonwealth’s goodwill or other intangible assets; (8) acts of God or of war or terrorism; (9) the timely development and acceptance of new products and services and perceived overall value of these products and services by users; (10) changes in consumer spending, borrowings and savings habits; (11) changes in the financial performance and/or condition of First Commonwealth’s borrowers; (12) technological changes; (13) acquisitions and integration of acquired businesses; (14) First Commonwealth’s ability to attract and retain qualified employees; (15) changes in the competitive environment in First Commonwealth’s markets and among banking organizations and other financial service providers; (16) the ability to increase market share and control expenses; (17) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters; (18) the reliability of First Commonwealth’s vendors, internal control systems or information systems; (19) the costs and effects of legal and regulatory developments, the resolution of legal proceedings or regulatory or other governmental inquiries, the results of regulatory examinations or reviews and the ability to obtain required regulatory approvals; and (20) other risks and uncertainties described in this report and in the other reports that we file with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K.

In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward-looking statements in this release. We undertake no obligation to publicly update or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Media Relations:Ron WahlCommunications and Media RelationsPhone: 724-463-6806E-mail: RWahl@fcbanking.com

Investor Relations:Ryan M. ThomasVice President / Finance and Investor RelationsPhone: 724-463-1690E-mail: RThomas1@fcbanking.com

 
FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands, except per share data)
 For the Three Months Ended
 March 31, December 31, March 31,
  2024   2023   2023 
SUMMARY RESULTS OF OPERATIONS     
Net interest income$92,304  $95,737  $94,358 
Provision for credit losses 4,238   (1,865)  (2,650)
Provision for credit losses — acquisition day 1 non-PCD       10,653 
Noninterest income 23,988   24,297   22,963 
Noninterest expense 65,573   65,180   71,381 
Net income 37,549   44,827   30,224 
Core net income (5) 37,639   44,964   45,387 
Earnings per common share (diluted)$0.37  $0.44  $0.30 
Core earnings per common share (diluted) (6)$0.37  $0.44  $0.45 
KEY FINANCIAL RATIOS     
Return on average assets 1.31%  1.56%  1.17%
Core return on average assets (7) 1.31%  1.56%  1.75%
Return on average assets, pre-provision, pre-tax 1.77%  1.91%  1.78%
Core return on average assets, pre-provision, pre-tax 1.77%  1.91%  2.11%
Return on average shareholders' equity 11.40%  14.11%  10.56%
Return on average tangible common equity (8) 16.51%  20.78%  15.75%
Core return on average tangible common equity (9) 16.54%  20.85%  23.42%
Core efficiency ratio (2)(10) 55.05%  53.00%  52.41%
Net interest margin (FTE) (1) 3.52%  3.65%  4.01%
      
Book value per common share$13.03  $12.87  $11.87 
Tangible book value per common share (11) 9.26   9.09   8.13 
Market value per common share 13.92   15.44   12.43 
Cash dividends declared per common share 0.125   0.125   0.120 
ASSET QUALITY RATIOS     
Nonperforming loans and leases as a percent of end-of-period loans and leases(3) 0.47%  0.44%  0.51%
Nonperforming assets as a percent of total assets (3) 0.38%  0.36%  0.41%
Net charge-offs as a percent of average loans and leases (annualized) (4) 0.19%  0.72%  0.06%
Allowance for credit losses as a percent of nonperforming loans and leases (4) 280.59%  298.23%  302.67%
Allowance for credit losses as a percent of end-of-period loans and leases (4) 1.32%  1.31%  1.55%
CAPITAL RATIOS     
Shareholders' equity as a percent of total assets 11.4%  11.5%  11.0%
Tangible common equity as a percent of tangible assets (12) 8.4%  8.4%  7.8%
Leverage Ratio 10.2%  10.0%  10.2%
Risk Based Capital - Tier I 12.2%  11.9%  11.5%
Risk Based Capital - Total 14.3%  13.9%  13.8%
Common Equity - Tier I 11.4%  11.2%  10.8%
            

FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands, except per share data)
 For the Three Months Ended
 March 31,December 31,March 31,
  2024 2023  2023 
INCOME STATEMENT   
Interest income$145,462$144,257 $114,589 
Interest expense 53,158 48,520  20,231 
Net Interest Income 92,304 95,737  94,358 
Provision for credit losses 4,238 (1,865) (2,650)
Provision for credit losses - acquisition day 1 non-PCD    10,653 
Net Interest Income after Provision for Credit Losses 88,066 97,602  86,355 
Net securities gains     
Trust income 2,727 2,549  2,486 
Service charges on deposit accounts 5,383 5,595  4,918 
Insurance and retail brokerage commissions 2,246 2,457  2,552 
Income from bank owned life insurance 1,294 1,211  1,227 
Gain on sale of mortgage loans 1,328 776  652 
Gain on sale of other loans and assets 2,051 1,740  2,086 
Card-related interchange income 6,690 7,218  6,829 
Derivative mark-to-market 12 (13) (89)
Swap fee income  490  245 
Other income 2,257 2,274  2,057 
Total Noninterest Income 23,988 24,297  22,963 
Salaries and employee benefits 35,324 36,232  34,264 
Net occupancy 5,334 4,637  5,018 
Furniture and equipment 4,480 4,372  4,238 
Data processing 3,824 3,986  3,404 
Pennsylvania shares tax 1,202 351  1,252 
Advertising and promotion 1,319 1,061  1,663 
Intangible amortization 1,264 1,210  1,147 
Other professional fees and services 1,242 1,543  1,591 
FDIC insurance 1,613 1,646  1,417 
Litigation and operational losses 997 1,378  743 
Loss on sale or write-down of assets 143 107  41 
Merger and acquisition 114 174  8,541 
Other operating expenses 8,717 8,483  8,062 
Total Noninterest Expense 65,573 65,180  71,381 
Income before Income Taxes 46,481 56,719  37,937 
Income tax provision 8,932 11,892  7,713 
Net Income$37,549$44,827 $30,224 
    
Shares Outstanding at End of Period 102,303,974 102,114,664  103,193,127 
Average Shares Outstanding Assuming Dilution 102,198,899 102,264,768  99,779,816 
    

FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)
      
 March 31, December 31, March 31,
  2024   2023   2023 
BALANCE SHEET (Period End)     
Assets     
Cash and due from banks$77,179  $125,436  $113,692 
Interest-bearing bank deposits 233,188   21,557   282,110 
Securities available for sale, at fair value 1,049,108   1,071,857   786,813 
Securities held to maturity, at amortized cost 464,708   419,009   451,278 
Loans held for sale 31,895   29,820   11,050 
      
Loans and leases 8,999,870   8,968,761   8,656,945 
Allowance for credit losses (119,098)  (117,718)  (133,885)
Net loans and leases 8,880,772   8,851,043   8,523,060 
      
Goodwill and other intangibles 385,745   386,535   385,998 
Other assets 571,813   554,231   559,751 
Total Assets$11,694,408  $11,459,488  $11,113,752 
      
Liabilities and Shareholders' Equity     
Noninterest-bearing demand deposits$2,334,495  $2,388,533  $2,698,225 
      
Interest-bearing demand deposits 637,908   629,138   547,015 
Savings deposits 4,999,822   4,886,781   5,127,037 
Time deposits 1,474,178   1,287,857   862,671 
Total interest-bearing deposits 7,111,908   6,803,776   6,536,723 
      
Total deposits 9,446,403   9,192,309   9,234,948 
      
Short-term borrowings 546,541   597,835   278,978 
Long-term borrowings 186,490   186,757   187,531 
Total borrowings 733,031   784,592   466,509 
      
Other liabilities 182,254   168,313   187,281 
Shareholders' equity 1,332,720   1,314,274   1,225,014 
Total Liabilities and Shareholders' Equity$11,694,408  $11,459,488  $11,113,752 
 

FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)
 
 For the Three Months Ended
 March 31,Yield/December 31,Yield/March 31,Yield/
  2024Rate 2023Rate 2023Rate
NET INTEREST MARGIN     
       
Assets      
Loans and leases (FTE)(1)(3)$8,998,6495.95%$8,974,6135.89%$8,301,4495.27%
Securities and interest-bearing bank deposits (FTE) (1) 1,584,6733.23% 1,465,9623.06% 1,279,4772.20%
Total Interest-Earning Assets (FTE) (1) 10,583,3225.54% 10,440,5755.49% 9,580,9264.86%
Noninterest-earning assets 938,121  961,555  907,982 
Total Assets$11,521,443 $11,402,130 $10,488,908 
       
Liabilities and Shareholders' Equity      
Interest-bearing demand and savings deposits$5,554,6562.11%$5,540,3641.90%$5,312,0860.88%
Time deposits 1,386,9594.21% 1,217,3563.81% 682,1442.34%
Short-term borrowings 595,8844.57% 548,6805.43% 266,9323.65%
Long-term borrowings 186,5975.76% 186,8605.75% 185,3675.06%
Total Interest-Bearing Liabilities 7,724,0962.77% 7,493,2602.57% 6,446,5291.27%
Noninterest-bearing deposits 2,302,338  2,434,560  2,678,849 
Other liabilities 169,683  213,492  202,476 
Shareholders' equity 1,325,326  1,260,818  1,161,054 
Total Noninterest-Bearing Funding Sources 3,797,347  3,908,870  4,042,379 
Total Liabilities and Shareholders' Equity$11,521,443 $11,402,130 $10,488,908 
       
Net Interest Margin (FTE) (annualized)(1) 3.52% 3.65% 4.01%
          

FIRST COMMONWEALTH FINANCIAL CORPORATION 
CONSOLIDATED FINANCIAL DATA
Unaudited   
(dollars in thousands)   
 March 31,December 31,March 31,
  2024  2023  2023 
Loan and Lease Portfolio Detail   
Commercial Loan and Lease Portfolio:   
Commercial, financial, agricultural and other$1,313,898 $1,310,405 $1,361,858 
Commercial real estate 3,090,950  3,053,152  2,991,930 
Equipment Finance loans and leases 279,938  232,944  109,221 
Real estate construction 520,320  541,633  422,831 
Total Commercial 5,205,106  5,138,134  4,885,840 
    
Consumer Loan Portfolio:   
Closed-end mortgages 1,913,479  1,926,254  1,807,941 
Home equity lines of credit 488,793  490,622  515,926 
Real estate construction 39,047  56,102  119,071 
Total Real Estate - Consumer 2,441,319  2,472,978  2,442,938 
    
Auto & RV loans 1,277,212  1,277,969  1,244,874 
Direct installment 26,731  27,167  30,381 
Personal lines of credit 46,733  49,355  49,399 
Student loans 2,769  3,158  3,513 
Total Other Consumer 1,353,445  1,357,649  1,328,167 
Total Consumer Portfolio 3,794,764  3,830,627  3,771,105 
Total Portfolio Loans and Leases 8,999,870  8,968,761  8,656,945 
Loans held for sale 31,895  29,820  11,050 
Total Loans and Leases$9,031,765 $8,998,581 $8,667,995 
    
    
 March 31,December 31,March 31,
  2024  2023  2023 
ASSET QUALITY DETAIL   
Nonperforming Loans and Leases:   
Loans and leases on nonaccrual basis *$27,649 $24,997 $29,413 
Loans on nonaccrual basis - Centric acquisition 14,797  14,475  14,821 
Total Nonperforming Loans and Leases$42,446 $39,472 $44,234 
Other real estate owned ("OREO") 368  422  424 
Repossessions ("Repos") 1,442  1,024  553 
Total Nonperforming Assets$44,256 $40,918 $45,211 
Loans past due in excess of 90 days and still accruing 1,699  9,436  1,440 
Classified loans and leases 89,284  87,056  76,962 
Criticized loans and leases 211,857  210,187  189,873 
    
Nonperforming assets as a percentage of total loans and leases, plus OREO and Repos (4) 0.49% 0.46% 0.52%
Allowance for credit losses$119,098 $117,718 $133,885 
 

FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)
 
 For the Three Months Ended
 March 31,December 31,March 31,
  2024  2023  2023 
Net Charge-offs (Recoveries):   
Commercial, financial, agricultural and other$2,242 $9,951 $504 
Real estate construction (6)    
Commercial real estate 169  4,579  (42)
Residential real estate 21  58  41 
Loans to individuals 1,876  1,750  670 
Net Charge-offs$4,302 $16,338 $1,173 
    
Net charge-offs as a percentage of average loans and leases outstanding (annualized) (4) 0.19% 0.72% 0.06%
Provision for credit losses as a percentage of net charge-offs 98.51% (11.42)% (225.92)%
Provision for credit losses$4,238 $(1,865)$(2,650)

DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES
Note: Management believes that it is standard practice in the banking industry to present these non-GAAP measures. These measures provide useful information to management and investors by allowing them to make peer comparisons.
    
(1) Net interest income has been computed on a fully taxable equivalent basis ("FTE") using the federal income tax statutory rate of 21%.
(2) Core efficiency ratio excludes from total revenue the impact of derivative mark-to-market and excludes from "total noninterest expense" the amortization of intangibles and any other unusual items deemed by management to not be related to normal operations, such as merger, acquisition and severance costs.
(3) Includes held for sale loans.
(4) Excludes held for sale loans.
 For the Three Months Ended
 March 31,December 31,March 31,
  2024 2023 2023 
    
Interest income$145,462$144,257$114,589 
Adjustment to fully taxable equivalent basis (1) 323 314 305 
Interest income adjusted to fully taxable equivalent basis (non-GAAP) 145,785 144,571 114,894 
Interest expense 53,158 48,520 20,231 
Net interest income, (FTE) (1)$92,627$96,051$94,663 
 

FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands, except per share data)
 
DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES
    
 For the Three Months Ended
 March 31,December 31,March 31,
  2024  2023  2023 
    
Net Income$37,549 $44,827 $30,224 
Intangible amortization 1,264  1,210  1,147 
Tax benefit of amortization of intangibles (265) (254) (241)
Net Income, adjusted for tax affected amortization of intangibles$38,548 $45,783 $31,130 
    
Average Tangible Equity:   
Total shareholders' equity$1,325,326 $1,260,818 $1,161,054 
Less: intangible assets 386,040  386,896  359,431 
Tangible Equity 939,286  873,922  801,623 
Less: preferred stock      
Tangible Common Equity$939,286 $873,922 $801,623 
    
(8)Return on Average Tangible Common Equity 16.51% 20.78% 15.75%

 For the Three Months Ended
 March 31,December 31,March 31,
  2024  2023  2023 
    
Core Net Income:   
Total Net Income$37,549 $44,827 $30,224 
Merger and acquisition related expenses 114  174  8,541 
Tax benefit of merger and acquisition related expenses (24) (37) (1,794)
Provision for credit losses - acquisition day 1 non-PCD     10,653 
Tax benefit of provision for credit losses - acquisition day 1 non-PCD     (2,237)
(5) Core net income$37,639 $44,964 $45,387 
Average Shares Outstanding Assuming Dilution 102,198,899  102,264,768  99,779,816 
(6) Core Earnings per common share (diluted)$0.37 $0.44 $0.45 
    
Intangible amortization 1,264  1,210  1,147 
Tax benefit of amortization of intangibles (265) (254) (241)
Core Net Income, adjusted for tax affected amortization of intangibles$38,638 $45,920 $46,293 
    
(9) Core Return on Average Tangible Common Equity 16.54% 20.85% 23.42%
          

FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA  
Unaudited
(dollars in thousands, except per share data)
 
DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES
    
 For the Three Months Ended
 March 31,December 31,March 31,
  2024  2023  2023 
Core Return on Average Assets:   
Total Net Income$37,549 $44,827 $30,224 
Total Average Assets 11,521,443  11,402,130  10,488,908 
Return on Average Assets 1.31% 1.56% 1.17%
    
Core Net Income (5)$37,639 $44,964 $45,387 
Total Average Assets 11,521,443  11,402,130  10,488,908 
(7) Core Return on Average Assets 1.31% 1.56% 1.75%

 For the Three Months Ended
 March 31,December 31,March 31,
  2024  2023  2023 
Core Efficiency Ratio:   
Total Noninterest Expense$65,573 $65,180 $71,381 
Adjustments to Noninterest Expense:   
Intangible amortization 1,264  1,210  1,147 
Merger and acquisition related 114  174  8,541 
Noninterest Expense - Core$64,195 $63,796 $61,693 
    
Net interest income, (FTE)$92,627 $96,051 $94,663 
Total noninterest income 23,988  24,297  22,963 
Net securities gains      
Total Revenue 116,615  120,348  117,626 
    
Adjustments to Revenue:   
Derivative mark-to-market 12  (13) (89)
Total Revenue - Core$116,603 $120,361 $117,715 
    
(10)Core Efficiency Ratio 55.05% 53.00% 52.41%

FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)
 
DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES
     
  March 31,December 31,March 31,
   2024  2023  2023 
 Tangible Equity:   
 Total shareholders' equity$1,332,720 $1,314,274 $1,225,014 
 Less: intangible assets 385,745  386,535  385,998 
  Tangible Equity 946,975  927,739  839,016 
 Less: preferred stock      
  Tangible Common Equity$946,975 $927,739 $839,016 
     
 Tangible Assets:   
 Total assets$11,694,408 $11,459,488 $11,113,752 
 Less: intangible assets 385,745  386,535  385,998 
  Tangible Assets$11,308,663 $11,072,953 $10,727,754 
     
 (12)Tangible Common Equity as a percentage of Tangible Assets 8.37% 8.38% 7.82%
     
 Shares Outstanding at End of Period 102,303,974  102,114,664  103,193,127 
 (11)Tangible Book Value Per Common Share$9.26 $9.09 $8.13 

 For the Three Months Ended
 March 31,December 31,March 31,
  2024 2023 2023 
Pre-tax pre-provision income:   
Net interest income$92,304$95,737$94,358 
Noninterest income 23,988 24,297 22,963 
Noninterest expense 65,573 65,180 71,381 
Pre-tax pre-provision income$50,719$54,854$45,940 
    
Net securities gains$$$ 
Merger and acquisition related expenses 114 174 8,541 
Core pre-tax pre-provision income$50,833$55,028$54,481 
    
Net charge-offs$4,302$16,338$1,173 
 

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Source: First Commonwealth Financial Corporation

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