First Commonwealth Financial (FCF) Q1 2025 earnings summary

Executive summary

• Net income for Q1 2025 was $32.7 million ($0.32 per share), down from $35.8 million in Q4 2024 and $37.5 million in Q1 2024, primarily due to higher noninterest expense and lower noninterest income, partially offset by increased net interest income.

• Core pre-tax pre-provision income was $46.9 million, with a 1.63% Core PTPP ROAA, down from prior periods.

• Return on average assets was 1.14% and return on average equity was 9.28%, both lower than Q1 2024.

• The quarterly dividend was increased by 3.9% to $0.135 per share.

• Acquisition of CenterGroup Financial closed April 30, 2025, expanding presence in Cincinnati and adding $341.6 million in assets.

Financial highlights

• Net interest income (FTE) rose to $95.9 million, up $0.4 million sequentially and $3.2 million year-over-year, with net interest margin increasing to 3.62%.

• Noninterest income was $22.5 million, down $2.8 million from Q4 2024, mainly due to lower SBA loan sales and a $3.0 million decline in card-related interchange income from Durbin Amendment impacts.

• Noninterest expense (excluding merger costs) increased to $71.1 million, up $2.1 million from the prior quarter, driven by higher salaries and benefits.

• Provision for credit losses was $5.7 million, up $1.5 million year-over-year, mainly due to higher off-balance sheet commitments.

• Tangible book value per share increased $0.40 to $10.44.

Outlook and guidance

• Management expects the Durbin Amendment to reduce 2025 interchange income by approximately $6.0 million compared to 2024.

• NIM is expected to expand to the high 370s by year-end, assuming three Fed rate cuts; could reach high 380s with no cuts.

• Fee income guidance: $23–24 million in Q2, with a seasonal decline expected in Q4.

• Non-interest expense projected at $71–73 million per quarter for the remainder of the year, including CenterGroup.

• Loan growth guidance remains mid-single digits.