F.N.B. Corporation

Good morning, everyone, and welcome to the FMB Corporation's third quarter 2022 earnings conference call. All participants will be in a 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 and then one using a touchtone telephone. To withdraw your questions, you may press star and two. Please also note today's event is being recorded. At this time, I'd like to turn the floor over to Lisa Constantine, Manager of Investor Relations. Ma'am, you may begin.

Thank you. Good morning and welcome to our earnings call. This conference call of FMV Corporation and the report it filed 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 a reported result prepared in accordance with GAAP. 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. Please 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 Wednesday, October 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 Dilley, Chairman, President, and CEO.

Thank you, and welcome to our third quarter earnings call. Joining me today are Vince Calabrese, our Chief Financial Officer, and Gary Guerrero, our Chief Credit Officer. F&B's third quarter operating earnings per share totaled a record 39 cents, increasing 26% on a linked quarter basis. The success of this quarter was highlighted by record revenue, high-quality loan and deposit growth, digital technology enhancements, and continued positive credit quality performance. We were also pleased to receive all regulatory approvals for our pending merger with UB Bank Corp and anticipate the merger to close and convert in December of this year. We are looking forward to welcoming Union Bank employees and clients to F&B. We are confident that they will benefit from our deep product suite and robust digital tools. Revenue totaled $380 million, led by 17% growth in net interest income, driven by solid loan growth, favorable deposit mix, and the asset-sensitive position of our balance sheet. our fee-based businesses contributed to over $82 million, once again demonstrating the importance of our long-term strategy of building diversified sources of income. Record revenue coupled with well-managed expenses led to our historically low efficiency ratio of 49%, as well as double-digit positive operating leverage for the third quarter. As we plan for 2023, we remain keenly focused on risk management expense control, diversification of revenue, and continuing to generate positive operating leverage. F&B again delivered double-digit annualized link quarter loan growth with total loans ending at nearly $28.5 billion. Consumer loans grew $547 million, driven by adjustable rate and positions-first mortgage loans. Positions-first mortgage product continued its success and accounted for 39% of the link quarter growth as we leveraged the investments in the e-store with the digital physician's first offerings. Commercial loans increased 189 million link quarter with annualized growth of 9% and 2% in CNI and CRE respectively. While growth was spread across the entire FMV footprint, the Cleveland and North Carolina markets contributed the largest increases. Deposits increased $413 million one quarter, or 4.9% annually. We ended the quarter with non-interest-bearing deposits accounting for 35% of total deposits. And Union Bank will enhance our overall position by contributing a higher proportion of non-interest-bearing deposits. Another area of continued success this quarter was with our digital channels, where e-store visits increased over 120% year-over-year in September. and monthly visits averaged over 37,000. We continue to expand our digital offerings for both our retail and business customers as we launch eStore online deposit applications for multiple business deposit products beginning in November. Next year, we will introduce enhancements to our mobile application, including real-time alerting capabilities and an update to our CardGuard debit card control service. Both features enhance our customers' ability to manage their account balances. Lastly, it is important to highlight the strong position of FMV's balance sheet in a time when leading indicators point to a potential economic softening. Our credit culture has been consistent, maintaining uniform underwriting standards through all parts of the economic cycle. That same credit culture served us well during the Great Recession when our loss rates meaningfully outperformed our peers. The credit team monitors the portfolio not only through typical historical analysis, but also uses prospective trends and analytics to identify any emerging risks. They also run various stress tests during their comprehensive reviews to evaluate our risk management systems and portfolio performance. Further mitigating risk and supporting our growth strategy is the geographic diversity of our footprint. Our presence in seven states and the District of Columbia provides FMB access to high-growth metropolitan areas and a variety of high-quality opportunities. Our numerous markets allow FMB to meet our growth objectives while still adhering to our conservative underwriting standards. This key risk management objective has been an important driver for our expansion strategy, as well as our unique business model. We continue to prudently manage our capital levels. As of last quarter, our CET1, TCE, and reserve coverage ratios all rank at or above peer meeting. While it is too early to know this quarter's results for our peer set, we expect that we will continue to maintain capital and reserve coverage ratios at or above the meetings once again demonstrating our solid position within the banking industry. FMB is well positioned for a potential economic slowdown with conservative management of our diversified loan portfolio and the strength of our reserve coverage and capital ratios. I will now turn the call over to Gary to provide additional detail of our asset policy.