FNB Earnings 2019-06-30

FNB 10Q Quarterly Report

Balance Sheet	Income Statement	Cash Flow

Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)



☒	Quarterly Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

For the quarterly period ended June 30, 2019



☐	Transition Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

For the transition period from to

Commission file number 001-31940

F.N.B. CORPORATION

(Exact name of registrant as specified in its charter)



Pennsylvania		25-1255406
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)



One North Shore Center,	12 Federal Street,	Pittsburgh,	PA	15212
(Address of principal executive offices)				(Zip Code)

Registrant’s telephone number, including area code: 800-555-5455

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):



Large Accelerated Filer	☒	Accelerated Filer	☐

Non-accelerated Filer	☐	Smaller reporting company	☐

		Emerging Growth Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act:



Title of Each Class	Trading Symbol(s)	Name of Exchange on which Registered
Common Stock, par value $0.01 per share	FNB	New York Stock Exchange

Depositary Shares each representing 1/40th interest in a share of Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series E	FNBPrE	New York Stock Exchange

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.



Class	Outstanding at	July 31, 2019
Common Stock, $0.01 Par Value	324,873,312	Shares

F.N.B. CORPORATION

FORM 10-Q

June 30, 2019

INDEX



		PAGE
PART I – FINANCIAL INFORMATION

	Glossary of Acronyms and Terms	3

Item 1.	Financial Statements

	Consolidated Balance Sheets	4
	Consolidated Statements of Income	5
	Consolidated Statements of Comprehensive Income	6
	Consolidated Statements of Stockholders’ Equity	7
	Consolidated Statements of Cash Flows	9
	Notes to Consolidated Financial Statements	10

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	57

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	89

Item 4.	Controls and Procedures	90

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	90

Item 1A.	Risk Factors	90

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	90

Item 3.	Defaults Upon Senior Securities	90

Item 4.	Mine Safety Disclosures	90

Item 5.	Other Information	91

Item 6.	Exhibits	91

Signatures		91

Glossary of Acronyms and Terms


AFS	Available for sale


ALCO	Asset/Liability Committee


AOCI	Accumulated other comprehensive income


ASC	Accounting Standards Codification


ASU	Accounting Standards Update


BOLI	Bank owned life insurance


Basel III	Basel III Capital Rules


CFPB	Consumer Financial Protection Bureau


EVE	Economic value of equity


FASB	Financial Accounting Standards Board


FDIC	Federal Deposit Insurance Corporation


FHLB	Federal Home Loan Bank


FNB	F.N.B. Corporation


FNBPA	First National Bank of Pennsylvania


FOMC	Federal Open Market Committee


FRB	Board of Governors of the Federal Reserve System


FTE	Fully taxable equivalent


FVO	Fair value option


GAAP	U.S. generally accepted accounting principles


HTM	Held to maturity


IRLC	Interest rate lock commitments


LCR	Liquidity Coverage Ratio


LIBOR	London Inter-bank Offered Rate


MCH	Months of Cash on Hand


MD&A	Management's Discussion and Analysis


MSR	Mortgage servicing rights


OCC	Office of the Comptroller of the Currency


OREO	Other real estate owned


OTTI	Other-than-temporary impairment


Regency	Regency Finance Company


SBA	Small Business Administration


SEC	Securities and Exchange Commission


TCJA	Tax Cuts and Jobs Act of 2017


TDR	Troubled debt restructuring


TPS	Trust preferred securities


UST	U.S. Department of the Treasury


YDKN	Yadkin Financial Corporation

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

F.N.B. CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

Dollars in millions, except share and per share data



	June 30, 2019			December 31, 2018
	(Unaudited)
Assets
Cash and due from banks	$	427		$	451
Interest bearing deposits with banks	72			37
Cash and Cash Equivalents	499			488
Debt securities available for sale	3,279			3,341
Debt securities held to maturity (fair value of $3,093 and $3,155)	3,079			3,254
Loans held for sale (includes $39 and $14 measured at fair value) ⁽¹⁾	332			22
Loans and leases, net of unearned income of $0 and $3	22,543			22,153
Allowance for credit losses	(188		)	(180		)
Net Loans and Leases	22,355			21,973
Premises and equipment, net	328			330
Goodwill	2,262			2,255
Core deposit and other intangible assets, net	74			79
Bank owned life insurance	539			537
Other assets	1,156			823
Total Assets	$	33,903		$	33,102
Liabilities
Deposits:
Non-interest-bearing demand	$	6,139		$	6,000
Interest-bearing demand	9,593			9,660
Savings	2,515			2,526
Certificates and other time deposits	5,484			5,269
Total Deposits	23,731			23,455
Short-term borrowings	3,711			4,129
Long-term borrowings	1,338			627
Other liabilities	370			283
Total Liabilities	29,150			28,494
Stockholders’ Equity
Preferred stock - $0.01 par value; liquidation preference of $1,000 per share
Authorized – 20,000,000 shares
Issued – 110,877 shares	107			107
Common stock - $0.01 par value
Authorized – 500,000,000 shares
Issued – 326,862,352 and 326,120,832 shares	3			3
Additional paid-in capital	4,057			4,049
Retained earnings	683			576
Accumulated other comprehensive loss	(72		)	(106		)
Treasury stock – 2,055,221 and 1,806,303 shares at cost	(25		)	(21		)
Total Stockholders’ Equity	4,753			4,608
Total Liabilities and Stockholders’ Equity	$	33,903		$	33,102


(1)	Amount represents loans for which we have elected the fair value option. See Note 17.

See accompanying Notes to Consolidated Financial Statements (unaudited)

F.N.B. CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

Dollars in millions, except per share data

Unaudited



	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019		2018
Interest Income
Loans and leases, including fees	$	276	$	258	$	545	$	497
Securities:
Taxable	32		29		65		56
Tax-exempt	8		6		16		13
Other	1		1		1		1
Total Interest Income	317		294		627		567
Interest Expense
Deposits	55		30		105		57
Short-term borrowings	22		19		48		34
Long-term borrowings	10		5		13		10
Total Interest Expense	87		54		166		101
Net Interest Income	230		240		461		466
Provision for credit losses	11		16		25		30
Net Interest Income After Provision for Credit Losses	219		224		436		436
Non-Interest Income
Service charges	32		31		62		61
Trust services	7		6		14		13
Insurance commissions and fees	4		5		9		10
Securities commissions and fees	5		5		9		9
Capital markets income	10		6		16		11
Mortgage banking operations	8		5		12		11
Dividends on non-marketable equity securities	4		4		9		8
Bank owned life insurance	3		3		6		6
Other	2		—		3		3
Total Non-Interest Income	75		65		140		132
Non-Interest Expense
Salaries and employee benefits	95		99		186		188
Net occupancy	16		16		31		32
Equipment	15		13		30		27
Amortization of intangibles	3		4		7		8
Outside services	16		17		31		32
FDIC insurance	6		9		12		18
Bank shares and franchise taxes	3		4		6		7
Other	21		21		38		42
Total Non-Interest Expense	175		183		341		354
Income Before Income Taxes	119		106		235		214
Income taxes	24		21		46		42
Net Income	95		85		189		172
Preferred stock dividends	2		2

Closing Price ($)	Shares Out (MM)	Market Cap ($MM)
$11.98	325	$3,890

10-Q	2019-06-30	Quarter: 2019-06-30
10-Q	2019-03-31	Quarter: 2019-03-31
10-K	2018-12-31	Annual: 2018-12-31
10-Q	2018-09-30	Quarter: 2018-09-30
10-Q	2018-06-30	Quarter: 2018-06-30
10-Q	2018-03-31	Quarter: 2018-03-31
10-K	2017-12-31	Annual: 2017-12-31
10-Q	2017-09-30	Quarter: 2017-09-30
10-Q	2017-06-30	Quarter: 2017-06-30
10-Q	2017-03-31	Quarter: 2017-03-31
10-K	2016-12-31	Annual: 2016-12-31
10-Q	2016-09-30	Quarter: 2016-09-30
10-Q	2016-06-30	Quarter: 2016-06-30
10-Q	2016-03-31	Quarter: 2016-03-31
10-K	2015-12-31	Annual: 2015-12-31
10-Q	2015-09-30	Quarter: 2015-09-30
10-Q	2015-06-30	Quarter: 2015-06-30
10-Q	2015-03-31	Quarter: 2015-03-31
10-K	2014-12-31	Annual: 2014-12-31
10-Q	2014-09-30	Quarter: 2014-09-30
10-Q	2014-06-30	Quarter: 2014-06-30
10-Q	2014-03-31	Quarter: 2014-03-31
10-K	2013-12-31	Annual: 2013-12-31

8-K	2019-07-23	Earnings, Exhibits
8-K	2019-05-15	Shareholder Vote
8-K	2019-04-23	Earnings, Exhibits
8-K	2019-04-22	Officers, Exhibits
8-K	2019-02-11	Enter Agreement, Off-BS Arrangement, Exhibits
8-K	2019-02-06	Regulation FD, Exhibits
8-K	2019-01-22	Earnings, Exhibits
8-K	2018-10-23	Earnings, Exhibits
8-K	2018-07-24	Earnings, Exhibits
8-K	2018-06-07	Other Events, Exhibits
8-K	2018-05-29	Other Events, Exhibits
8-K	2018-05-16	Shareholder Vote
8-K	2018-04-24	Earnings, Exhibits
8-K	2018-04-02	Officers, Exhibits
8-K	2018-01-23	Earnings, Exhibits

TSCO	Tractor Supply	12,410
DNLI	Denali Therapeutics	2,140
FNLC	First Bancorp	288
SPOK	Spok Holdings	281
ATTO	Atento	257
PYX	Playtex Products	163
ALT	Altimmune	38
NVFY	Nova Lifestyle	21
TPIV	Tapimmune	0
ACHI	Achison	0

EX-31.1	fnb10-qex311q22019.htm
EX-31.2	fnb10-qex312q22019.htm
EX-32.1	fnb10-qex321q22019.htm
EX-32.2	fnb10-qex322q22019.htm