F.N.B. Corporation (NYSE: FNB), a financial services company operating in several states, announced its financial results for the third quarter of 2024 on October 17th. The company reported a decline in profits compared to the same period last year, as rising interest rates and higher loan loss provisions impacted its earnings.
In the third quarter, F.N.B. reported net income available to common stockholders of $110.1 million, or $0.30 per diluted share, down from $143.3 million, or $0.40 per diluted share, in the third quarter of 2023. On an operating basis, which excludes certain one-time items, earnings per diluted common share were $0.34, compared to $0.40 in the year-ago quarter.
The decline in profitability was primarily driven by an increase in the provision for credit losses, which rose to $23.4 million from $25.9 million a year earlier. This reflected higher net charge-offs of $21.5 million, or 0.25% annualized of total average loans, compared to $37.7 million, or 0.47% annualized, in the third quarter of 2023. The higher provision was a precautionary measure by the bank to bolster its loan loss reserves in anticipation of potential credit quality deterioration amid rising interest rates and economic uncertainty.
Despite the challenges, F.N.B. reported solid revenue growth, with net interest income increasing by 2.4% to $323.3 million compared to the prior quarter, driven by higher earning asset yields and loan growth. Non-interest income reached a record $89.7 million, up 10.0% from the year-ago quarter, benefiting from the company's diversified business model and strong fee income from services such as mortgage banking and wealth management.
F.N.B.'s management remains cautious about the economic outlook but is confident in the company's ability to navigate the challenging environment. The bank's strong deposit growth, with total deposits increasing by 5.1% to $36.8 billion, and solid capital ratios position it well to weather potential economic headwinds.
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