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 expenses 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.

• Loans grew at a 4.4% annualized rate and deposits at 7.7% annualized, with commercial loans driving most of the increase.

• Net interest margin rose to 3.62%, up 8 bps sequentially and 10 bps year-over-year.

• The quarterly dividend was increased by 3.9% to $0.135 per share, with the CenterGroup/Center Bank acquisition closing April 30, 2025, expanding Cincinnati presence.

Financial highlights

• Net interest income (FTE) rose to $95.9 million, up $0.4 million sequentially and $3.2 million year-over-year, driven by improved asset yields and lower deposit costs.

• Fee income declined by $1.5 million in Q1, impacted by the Durbin Amendment and lower SBA gains, but other fee businesses offset some of the impact.

• Noninterest expense increased to $71.1 million, up $2.1 million from Q4, mainly due to higher salaries, benefits, and incentive compensation.

• Tangible book value per share grew 16.3% annualized from the previous quarter, reaching $10.44.

• No share buybacks in Q1; $6.7 million remains authorized under the current program.

Outlook and guidance

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

• Loan growth guidance remains mid-single digits, with fee income expected to improve to $23–24 million in Q2 and seasonal fluctuations in Q3 and Q4.

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

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

• Focus remains on expense control, credit quality, and integrating the CenterGroup acquisition.