F.N.B. Corporation

Hello and welcome to the FMB Corporation first quarter 2022 earnings call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your touch-tone phone. To withdraw your question, please press star, then two. Please note, today's event is being recorded. I now would like to turn the conference over to Lisa Constantine, Investor Relations. Ms. Constantine, please go ahead.

Thank you. Good morning and welcome to our earnings call. This conference call of FMV Corporation and the reports it files with the Securities and Exchange Commission often contain forward-looking statements and non-GAAP financial measures. Non-GAAP financial measures should be viewed in addition to and not as an alternative for our reported results prepared in accordance with GAAPs. Reconciliations of GAAP to non-GAAP operating measures to the most directly comparable GAAP financial measures are included in our presentation materials and in our earnings release. We refer to these non-GAAP and forward-looking statement disclosures contained in our related materials, reports, and registration statements filed with the Securities and Exchange Commission and available on our corporate website. A replay of this call will be available until Tuesday, April 26th and the webcast link will be posted to the About Us Investor Relations section of our corporate website. I will now turn the call over to Vince DeLee, Chairman, President, and CEO.

Thank you, and welcome to our first quarter earnings call. Joining me today are Vince Calabrese, our Chief Financial Officer, and Gary Guerrero, our Chief Credit Officer. FNB began 2022 with solid fundamental performance and the full integration of the Howard Bank acquisitions. We are pleased that the deal metrics associated with Howard came in at or better than planned, with a positive impact to our capital ratios. Howard added $1.8 billion of loans to the balance sheet, bringing our total assets to $42 billion. In fact, on a combined basis, F&B had strong loan pipeline growth in the mid-Atlantic region, up 13% year-over-year and 61% linked quarters. Our expectation is that the Mid-Atlantic region will continue to grow with the exceptional employees and new clients who joined FMV. Additionally, we expect to receive revenue benefit from FMV's more robust product set as we offer these services to the existing customer base already in the market. Earlier this month, FMV's Board of Directors approved a new $150 million share repurchase program, providing additional flexibility to effectively manage capital and benefit our shareholders. FMB reported first quarter GAAP earnings per share of $0.15 and $0.26 on an operating basis. Revenue increased 3.4% linked quarter, led by net interest income increasing 5%. We remain well positioned to grow net interest income, given the strategic steps we undertook to position our balance sheet, and benefit from the current interest rate cycle. These include favorable deposit mix changes and investing in a short-term securities portfolio. We remain well positioned with $16 billion of assets that are tied to short-term rate indices. Loans increased $2 billion, or 8.2%, when excluding PPP. While Howard contributed to the growth, commercial loan production was more than a billion, up 30% year over year. As we look ahead, pipelines have rebuilt from our strong growth in the fourth quarter and are up 23% quarter over quarter. This gives us additional confidence in our mid to high single-digit organic loan growth guidance for the full year. Our fee income businesses contributed another solid quarter at $78 million, essentially flat to the last quarter. Wealth management continued to produce record results, with revenues increasing 1.1 million linked quarter, or nearly 30% annualized, driven primarily by record organic sales activity. Mortgage banking income increased 700,000 linked quarter to 7 million amid significant interest rate volatility. While rising mortgage rates are expected to reduce refinance activity, we are confident our diversified geographic footprint and consistent commitments to the home purchase and new construction market will help us outperform the industry. In fact, nearly 80% of our originations this quarter were for purchase money mortgages. FMB's investment in technology has also enabled us to efficiently bring in more mortgage clients, with 66% of our mortgage application submitted through our online e-store. As we continue to grow our balance sheet, we remain vigilant in examining the current macroeconomic environment of high inflation, supply chain disruption, and geopolitical unrest. We have proactively assessed the risks and activated plans given the current environment. Our credit team is continually monitoring the industries that are potentially affected by the rising interest rates, higher food, oil and gas, and commodity prices, and supply chain disruptions. We will continue to assess the environmental risks and adjust our strategy appropriately to ensure consistent performance while addressing the needs of our key stakeholders. I will now turn the call over to Gary to discuss overall credit performance and the steps his team has taken to position our portfolio.