F.N.B. Corporation

Good morning and welcome to the FNB Corporation third quarter 2023 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. Please note this event is being recorded. I'd now like to turn the conference over to Lisa Hajdu. Please go ahead.

Thank you. Good morning and welcome to our earnings call. This conference call of FMB 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 our reported results prepared in accordance with GAAP. Reconciliations of GAAP to non-GAAP financial 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 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 Thursday, 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. FMB reported third quarter net income available to common shareholders of $143 million, or 40 cents per diluted common share. This quarter's performance represents EPS growth of 3% in the quarter. Our results reflect the execution of FMB's long-term strategies geared towards risk management, client primacy, generating organic growth, and diversifying fee-based income. Our third quarter efficiency ratio equals 51.7% and is expected to remain in the upper quartile on a pure relative basis. In addition, operating leverage on a year-to-date basis is 8%. Tangible book value per share has increased 12.5% year-over-year to $9.02, despite the impact of higher interest rates. And return on tangible common equity was again at a solid level of 18.2%. As we have previously mentioned, SMB is well-positioned to steadily increase market share in this volatile environment, given the strength of our capital and liquidity position and adherence to our consistent and conservative underwriting guidelines. Total deposits ended the third quarter at $34.6 billion, a 2.3% increase from the second quarter, while maintaining a relatively stable mix of non-interest-bearing deposits at 31%. Our third quarter linked deposit growth once again outpaced the Federal Reserve H-8 deposit data, continuing a trend of quarterly outperformance versus the industry and demonstrating the strength of our granular deposit base and diversified geographic footprint, as well as our goal to be the primary bank for our clients. In fact, FDIC deposit market share data released in September revealed that FMV ranks in the top five in nearly 50% of the MSAs we operate in, and in the top three in nearly 30%. Despite the acceleration of deposit competition throughout the banking industry, FMV spot deposits have decreased less than a half percent since year-end 2022, demonstrating our trusted position as our customer's primary operating bank. Our deposit growth this quarter was effectively funded dollar-for-dollar by our 2.5% linked quarter growth in loans, which also meaningfully outperformed H-8 data. Commercial loan growth of 2.4% benefited from the highest level of quarterly production year-to-date, which was spread across the entire footprint. Since year-end 2022, we have achieved 6.3% spot loan growth while building our CET1 ratio to 10.2%. Tangible common equity to tangible asset ratio also continues to build, totaling 7.54% this quarter, even against the backdrop of higher rates. Additionally, our solid liquidity positions and better-than-peer funding costs provides balance sheet optionality and the ability to support our clients' capital needs. The loan-to-deposit ratio remains at a comfortable level of 92.9%. We also continue to invest in capabilities to gain market share and further outpace our competitors, particularly in the digital offerings we deliver for retail and business customers. Our award-winning eStore offers unique platforms driving a better customer experience and product penetration. Our most recent implementation, the eStore Common Application, creates a single universal account application for the majority of our consumer loan products and services, enabling customers to apply for multiple products simultaneously in a very streamlined manner. In a few months, we will add our consumer deposit products to the Common Application, which will facilitate faster customer onboarding across multiple products and should meaningfully accelerate the adoption of the common application. We will capitalize on our competitive advantage with our superior digital offering and the strength of our balance sheet to acquire and grow customer relationships across our seven-state footprint. During the quarter, we fully charged off the commercial industrial loan we mentioned in our second quarter earnings call. Gary will provide more information during his presentation. Absent that isolated charge-off, total net charge-offs would have been a modest seven basis points, and total delinquency stood at 63 basis points. Our growth strategies are balanced by a diligent focus on risk management. We closely monitor macroeconomic and market-specific trends to manage risk as part of our core credit philosophy, which has served us well in softer economic times. We remain steadfast in our approach to consistent underwriting and managing credit risk to maintain a balanced, well-positioned portfolio throughout economic cycles, enabling us to serve our customers through business cycles in ways our competitors cannot. I will now turn the call over to Gary to provide additional information on our credit performance.