• First Commonwealth Announces Record Fourth Quarter and Full Year 2022 Revenue; Declares Quarterly Dividend

    Source: Nasdaq GlobeNewswire / 24 Jan 2023 17:00:01   America/New_York

    INDIANA, Pa., Jan. 24, 2023 (GLOBE NEWSWIRE) -- First Commonwealth Financial Corporation (NYSE: FCF) today announced financial results for the fourth quarter and full year of 2022.

    Financial Summary

    (dollars in thousands,For the Three Months Ended For the Years Ended
    except per share data)December 31, September 30, December 31, December 31, December 31,
      2022   2022   2021   2022   2021 
    Reported Results         
    Net income$35,733  $33,968  $34,776  $128,181  $138,257 
    Diluted earnings per share$0.38  $0.36  $0.37  $1.37  $1.44 
    Return on average assets 1.47%  1.41%  1.45%  1.34%  1.47%
    Return on average equity 13.61%  12.67%  12.36%  11.99%  12.55%
              
    Operating Results (non-GAAP)(1)         
    Core net income$36,750  $34,353  $34,753  $129,561  $138,518 
    Core diluted earnings per share$0.39  $0.37  $0.37  $1.38  $1.45 
    Core pre-tax pre-provision net revenue$55,289  $48,860  $40,868  $183,038  $171,771 
    Provision expense$9,120  $5,923  $(2,729) $21,106  $(1,376) 
    Net charge-offs$2,014  $2,461  $(1,064)  $7,137  $8,410 
    Reserve build/(release)(2)$6,813  $2,490  $(1,663) $10,384  $(8,787)
    Core return on average assets (ROAA) 1.51%  1.43%  1.45%  1.35%  1.47%
    Core pre-tax pre-provision ROAA 2.28%  2.03%  1.71%  1.91%  1.83%
    Return on average tangible common equity 19.77%  18.28%  17.56%  17.30%  17.95%
    Core return on average tangible common equity 20.32%  18.48%  17.55%  17.49%  17.98%
    Core efficiency ratio 50.00%  54.06%  57.06%  54.59%  54.69%
    Net interest margin (FTE) 3.99%  3.76%  3.23%  3.58%  3.26%

    (1) Core operating results are a non-GAAP measure used by management to measure performance in operating the business that management believes enhances investors' ability to better understand the underlying business performance and trends related to core business activities. A full reconciliation of non-GAAP financial measures can be found at the end of the financial statements which accompany this release.
    (2) Reserve build/(release) represents the net change in the Company's allowance for credit losses (ACL) from the prior period.
            

    Fourth Quarter 2022 Highlights

    • Net income of $35.7 million and diluted earnings per share totaled $0.38, an increase of $1.8 million, or $0.02 per share from the previous quarter and an increase of $1.0 million, or $0.01 per share from the fourth quarter of 2021
    • Record core pre-tax pre-provision net revenue (PPNR)(1) totaled $55.3 million, an increase of $6.4 million from the previous quarter and an increase of $14.4 million from the fourth quarter of 2021
    • Total loans increased $291.3 million, or 15.7% annualized, from the previous quarter, driven by broad-based growth in nearly all commercial and consumer categories
      • Average loans increased $229.6 million, or 12.5% annualized, from the previous quarter
    • Record net interest income (FTE) of $88.3 million increased $5.7 million from the previous quarter and $17.8 million from the fourth quarter of 2021
    • Noninterest income of $24.3 million decreased $1.6 million from the previous quarter due to a $1.6 million decrease in commercial swap fee income
    • Noninterest expense (excluding $1.3 million of merger and COVID-19 related expenses) of $57.0 million decreased $2.4 million from the previous quarter
    • Average deposits decreased $75.2 million, or 3.7% annualized, compared to the prior quarter
    • Total shareholders’ equity increased $29.5 million from the previous quarter due to a $24.5 million increase in retained earnings and a $4.6 million increase in accumulated other comprehensive income (AOCI)
    • Tangible book value per share grew 16.7% annualized compared to the prior quarter
    • The Bank was named the #1 Small Business Association (SBA) lender in the SBA’s designated Pittsburgh District for the second consecutive year and ranked #2 overall in the state of Pennsylvania

    Profitability

    • Core return on average assets (ROAA) improved eight basis points to 1.51% compared to the previous quarter
    • Core pre-tax pre-provision ROAA(1) for the quarter ended December 31, 2022 was 2.28% as compared to 2.03% in the prior quarter and 1.71% in the fourth quarter of 2021
    • The net interest margin of 3.99% increased 23 basis points from the prior quarter and increased 76 basis points from the fourth quarter of 2021
    • The core efficiency ratio(1) of 50.00% decreased 406 basis points from the previous quarter and decreased 706 basis points from the fourth quarter of 2021

    Strong capital position

    • Bank-level Tier 1 Capital ratio of 11.3%, which represents $261.5 million in excess capital above the regulatory “well capitalized” requirement of 8.0%
    • There were no shares repurchased during the fourth quarter of 2022. The remaining repurchase capacity under the current program was $5.9 million as of December 31, 2022

    Asset quality

    • The provision for credit losses was $9.1 million, an increase of $3.2 million compared to the previous quarter due primarily to additional reserves associated with the $291.3 million increase in loans during the fourth quarter of 2022
    • The allowance for credit losses as a percentage of end-of-period loans was 1.35% compared to 1.31% in the previous quarter
    • Total criticized loans decreased $6.4 million from the previous quarter
    • Net charge-offs on loans totaled $2.0 million, a decrease of $0.4 million from the previous quarter
      • Net charge-offs as a percentage of average loans outstanding (excluding PPP loans, annualized) were 0.11% in the fourth quarter of 2022 as compared to 0.13% in the previous quarter

    Full Year 2022 Highlights

    Franchise Growth

    • On August 30, 2022, the Company announced its planned expansion into Central and Eastern Pennsylvania with the acquisition of Centric Financial Corporation (OTCPK: CFCX). The legal close of this transaction is expected to be completed on January 31, 2023
    • Total loans grew $863.2 million, or 12.7% compared to the prior year (excluding Paycheck Protection Program “PPP” loans)
    • Average deposits grew $190.1 million, or 2.4% compared to the prior year, including $128.1 million, or 5.0%, in average noninterest-bearing deposits
      • End of period deposits grew $23.0 million, or 0.3% compared to the prior year, including $11.7 million, or 0.4%, in average noninterest-bearing deposits

    Earnings

    • For the year ended December 31, 2022, net income was $128.2 million, or $1.37 diluted earnings per share
      • Core net income(1) was $129.6 million, or $1.38 diluted earnings per share, compared to $138.5 million, or $1.45 diluted earnings per share in the prior year
    • Record core pre-tax pre-provision income(1) of $183.0 million grew $11.3 million, or 6.6% from the prior year, despite a $20.5 million decrease in PPP income
    • Operating leverage was positive for the year ended December 31, 2022
      • Core revenue(1) grew $27.6 million, or 7.2%, from the prior year despite the aforementioned decrease in PPP revenue
      • Core noninterest expense(1) increased $14.7 million, or 7.0%, from the prior year

    Profitability

    • The core efficiency ratio(1) improved 10 basis points to 54.59% compared to the prior year
    • The return on average assets (ROAA) for the year ended December 31, 2022 was 1.34%
      • Core ROAA(1) for the year ended December 31, 2022 was 1.35% as compared to 1.47% in the prior year
      • Core pre-tax pre-provision ROAA(1) for the year ended December 31, 2022 was 1.91% as compared to 1.83% in the prior year

    “Our results for the quarter were strong, resulting in a record 2.28% Core Pre-Tax, Pre-Provision ROAA and a healthy 1.51% Core ROAA,” stated T. Michael Price, President and Chief Executive Officer.   “Loans grew by 15.7% annualized in the fourth quarter, with broad-based production in all of our regions as well as our commercial and consumer portfolios.”   Price continued, “As we look to the year ahead, we are excited about the integration of Centric Bank into our franchise as well as the opportunities that exist with an enhanced presence in their markets.   In addition, our de novo Equipment Finance business is on pace to contribute meaningfully to our growth and augment our commercial lending business.   And our ongoing investments in talent, technology and our regional business model continue to position us well – all to the benefit of our clients, employees, communities and shareholders."

    Earnings

    Net income for the fourth quarter of 2022 was $35.7 million, or $0.38 per share, compared to $34.0 million, or $0.36 per share in the third quarter of 2022 and $34.8 million, or $0.37 per share for the fourth quarter of 2021.

    Net income for the year ended December 31, 2022 was $128.2 million, or $1.37 per share, compared to $138.3 million, or $1.44 per share for the same period in 2021.

    Net Interest Income and Net Interest Margin

    Net interest income (FTE) of $88.3 million increased $5.7 million from the previous quarter and increased $17.8 million from the prior year quarter.   The increase from the previous quarter was primarily due to a $7.9 million increase in income on variable and adjustable rate loans, partially offset by a $3.0 million increase in deposit costs.

    The net interest margin for the fourth quarter of 2022 was 3.99%, an increase of 23 basis points from the previous quarter and an increase of 76 basis points from the fourth quarter of 2021.   Loan yields increased 44 basis points from the previous quarter primarily due to the aforementioned increase in income on variable and adjustable rate loans, and, together with a $229.6 million increase in average loans, more than offset a 15 basis point increase in the cost of deposits and a $162.9 million increase in average short-term borrowings.

    Total average deposits decreased $75.2 million in the fourth quarter of 2022 as compared to the previous quarter.   A $68.0 million decrease in average interest-bearing demand and savings deposits was partially offset by a $9.4 million increase in time deposits.   

    Total end-of-period deposits decreased $72.2 million, or 3.5% annualized, from the previous quarter.  

    Asset Quality

    Provision expense in the fourth quarter of 2022 totaled $9.1 million as compared to $5.9 million in the previous quarter.   The increase in provision expense during the quarter was primarily driven by strong loan growth that drove a $4.6 million increase in the allowance for credit losses (ACL). The ACL was also impacted by an increase of $3.7 million in reserves due to various inputs such as the forecasted U.S. unemployment rate, the Gross Domestic Product (GDP) forecast and changes in estimated prepayment speeds.

    Nonperforming loans totaled $35.5 million, a decrease of $0.2 million from the previous quarter and a decrease of $19.7 million from the fourth quarter of 2021.   Nonperforming loans represented 0.46% of total loans (excluding PPP loans) as compared to 0.49% and 0.81% for the periods ended September 30, 2022 and December 31, 2021, respectively.

    At December 31, 2022, criticized loans totaled $132.9 million, a decrease of $6.4 million from the previous quarter.  

    During the fourth quarter of 2022, net charge-offs were $2.0 million as compared to net charge-offs of $2.5 million in the previous quarter and ($1.1) million in the fourth quarter of 2021.  

    Net charge-offs as a percentage of average loans (excluding PPP, annualized) were 0.11%, 0.13% and (0.06%) for the periods ended December 31, 2022, September 30, 2022 and December 31, 2021, respectively.

    Noninterest Income and Noninterest Expense

    Noninterest income totaled $24.3 million for the fourth quarter of 2022, as compared to $25.9 million for the third quarter of 2022 and $26.1 million for the fourth quarter of 2021.   The $1.6 million decrease from the previous quarter was primarily due to a $1.6 million decrease in commercial swap fee income.  

    For the year ended December 31, 2022, noninterest income totaled $98.7 million, a decrease of $8.0 million from the prior year.   The decrease from the prior year was due to an $8.3 million decrease in gain on sale of Mortgage loans and a $2.0 million decrease in derivative mark-to-market, partially offset by a $2.1 million increase in swap fee income and a $1.7 million increase in service charges on deposit accounts.

    Noninterest expense (excluding $1.3 million of merger, branch consolidation, and COVID-19 related expenses) totaled $57.0 million for the fourth quarter of 2022, as compared to $59.4 million for the third quarter of 2022 and $55.5 million for the fourth quarter of 2021. The $2.4 million decrease from the previous quarter was primarily the result of a $0.9 million adjustment in the present value of future BOLI obligations (which is included in salaries and employee benefits) and a $0.6 million decrease in Pennsylvania state shares tax as the result of tax credits from prior periods.

    The core efficiency ratio was 50.00% during the fourth quarter of 2022 as compared to 54.06% in the previous quarter and 57.06% in the fourth quarter of 2021.

    For the year ended December 31, 2022, noninterest expense (excluding $1.7 million of merger, branch consolidation and COVID-19 related expenses) totaled $227.9 million, as compared to $213.5 million in the prior year. The $14.4 million increase from the prior year was primarily driven by a $6.5 million increase in salaries and benefits, a $1.5 million increase in data processing expense and a $1.5 million increase in occupancy expense.  

    The core efficiency ratio was 54.59% for the year ended December 31, 2022 as compared to 54.69% in the previous year.

    Full time equivalent staff was 1,424 at December 31, 2022, 1,422 at September 30, 2022, and 1,426 at December 31, 2021.  

    Dividends and Capital

    First Commonwealth Financial Corporation declared a common stock quarterly dividend of $0.12 per share, which represents a 4.3% increase from the fourth quarter of 2021. The cash dividend is payable on February 17, 2023 to shareholders of record as of February 3, 2023. This dividend represents a 3.4% projected annual yield utilizing the January 23, 2023 closing market price of $14.06.

    First Commonwealth’s capital ratios for Total, Tier I, Leverage and Common Equity Tier I at December 31, 2022 were 14.4%, 12.0%, 10.2% and 11.1%, respectively.  First Commonwealth’s current capital levels exceed the fully phased-in Basel III capital requirements issued by U.S. bank regulators.

    Conference Call

    First Commonwealth will host a quarterly conference call to discuss its financial results for the fourth quarter and full year 2022 on Wednesday, January 25, 2023 at 2:00 PM (ET). The call can be accessed by dialing (toll free) 1-888-330-3181 conference ID # 4651379 or through the company’s web page, http://www.fcbanking.com/InvestorRelations. A replay of the call will be available approximately one hour following the conclusion of the conference by dialing 1-800-770-2030 and entering the conference ID # 4651379. A link to the webcast replay will also be accessible on the company’s webpage for 30 days.

    About First Commonwealth Financial Corporation

    First Commonwealth Financial Corporation (NYSE: FCF), headquartered in Indiana, Pennsylvania, is a financial services Company with 119 community banking offices in 26 counties throughout western and central Pennsylvania and throughout Ohio, as well as business banking operations in Pittsburgh, Pennsylvania, and Canton, Cleveland, Columbus and Cincinnati, Ohio. The Company also operates mortgage offices in Wexford, Pennsylvania, as well as Hudson, and Lewis Center, Ohio. First Commonwealth provides a full range of commercial banking, consumer banking, mortgage, equipment finance, wealth management and insurance products and services through its subsidiaries First Commonwealth Bank and First Commonwealth Insurance Agency. For more information about First Commonwealth or to open an account today, please visit www.fcbanking.com. 

    Forward-Looking Statements

    Certain statements contained in this release that are not historical facts may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, notwithstanding that such statements are not specifically identified as such. In addition, certain statements may be contained in our future filings with the Securities and Exchange Commission, in press releases, and in oral and written statements made by us or with our approval that are not statements of historical fact and constitute “forward-looking statements” as well. These statements, which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of words such as “may,” “will,” “should,” “could,” “would,” “plan,” “believe,” “expect,” “anticipate,” “intend,” “estimate” or words of similar meaning. These forward-looking statements are subject to significant risks, assumptions and uncertainties, including uncertainties regarding the impact of the COVID-19 pandemic, and could be affected by many factors, including, but not limited to: (1) the effects of   the COVID-19 pandemic on First Commonwealth and its customers; (2) volatility and disruption in national and international financial markets; (3) the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board; (4) inflation, interest rate, commodity price, securities market and monetary fluctuations; (5) the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which First Commonwealth or its customers must comply; (6) the soundness of other financial institutions; (7) political instability; (8) impairment of First Commonwealth’s goodwill or other intangible assets; (9) acts of God or of war or terrorism; (10) the timely development and acceptance of new products and services and perceived overall value of these products and services by users; (11) changes in consumer spending, borrowings and savings habits; (12) changes in the financial performance and/or condition of First Commonwealth’s borrowers; (13) technological changes; (14) acquisitions and integration of acquired businesses; (15) First Commonwealth’s ability to attract and retain qualified employees; (16) changes in the competitive environment in First Commonwealth’s markets and among banking organizations and other financial service providers; (17) the ability to increase market share and control expenses; (18) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters; (19) the reliability of First Commonwealth’s vendors, internal control systems or information systems; (20) the costs and effects of legal and regulatory developments, the resolution of legal proceedings or regulatory or other governmental inquiries, the results of regulatory examinations or reviews and the ability to obtain required regulatory approvals; and (21) other risks and uncertainties described in this report and in the other reports that we file with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K. Further, statements about the potential effects of the COVID-19 pandemic on our business, financial condition, liquidity and results of operations may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond our control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on our customers, clients, third parties and us.  

    In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward-looking statements in this release. We undertake no obligation to publicly update or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise.

    Media Relations:
    Jonathan E. Longwill
    Vice President / Communications and Media Relations
    Phone: 724-463-6806
    E-mail: JLongwill@fcbanking.com

    Investor Relations:
    Ryan M. Thomas
    Vice President / Finance and Investor Relations
    Phone: 724-463-1690
    E-mail: RThomas1@fcbanking.com

    FIRST COMMONWEALTH FINANCIAL CORPORATION      
    CONSOLIDATED FINANCIAL DATA         
    Unaudited         
    (dollars in thousands, except per share data)         
     For the Three Months Ended For the Years Ended
     December 31, September 30, December 31, December 31, December 31,
      2022   2022   2021   2022   2021 
    SUMMARY RESULTS OF OPERATIONS         
    Net interest income$88,027  $82,360  $70,254  $312,221  $278,541 
    Provision for credit losses 9,120   5,923   (2,729)  21,106   (1,376)
    Noninterest income 24,309   25,914   26,071   98,708   106,757 
    Noninterest expense 58,334   59,901   55,428   229,638   213,857 
    Net income 35,733   33,968   34,776   128,181   138,257 
    Core net income(5) 36,750   34,353   34,753   129,561   138,518 
    Earnings per common share (diluted)$0.38  $0.36  $0.37  $1.37  $1.44 
    Core earnings per common share (diluted)(6)$0.39  $0.37  $0.37  $1.38  $1.45 
    KEY FINANCIAL RATIOS         
    Return on average assets 1.47%  1.41%  1.45%  1.34%  1.47%
    Core return on average assets(7) 1.51%  1.43%  1.45%  1.35%  1.47%
    Return on average assets, pre-provision, pre-tax 2.22%  2.01%  1.71%  1.89%  1.82%
    Core return on average assets, pre-provision, pre-tax 2.28%  2.03%  1.71%  1.91%  1.83%
    Return on average shareholders' equity 13.61%  12.67%  12.36%  11.99%  12.55%
    Return on average tangible common equity(8) 19.77%  18.28%  17.56%  17.30%  17.95%
    Core return on average tangible common equity(9) 20.32%  18.48%  17.55%  17.49%  17.98%
    Core efficiency ratio(2)(10) 50.00%  54.06%  57.06%  54.59%  54.69%
    Net interest margin (FTE)(1) 3.99%  3.76%  3.23%  3.58%  3.26%
              
    Book value per common share$11.27  $10.95  $11.77     
    Tangible book value per common share(11) 7.92   7.60   8.43     
    Market value per common share 13.97   12.84   16.09     
    Cash dividends declared per common share 0.120   0.120   0.115   0.475   0.455 
    ASSET QUALITY RATIOS         
    Nonperforming loans as a percent of end-of-period loans and leases(3) 0.46%  0.48%  0.80%    
    Nonperforming loans as a percent of end-of-period loans and leases, excluding PPP loans(3) 0.46%  0.49%  0.81%    
    Nonperforming assets as a percent of total assets(3) 0.37%  0.38%  0.59%    
    Nonperforming assets as a percent of total assets, excluding PPP loans(3) 0.37%  0.38%  0.59%    
    Net charge-offs as a percent of average loans and leases (annualized)(4) 0.11%  0.13% (0.06)%    
    Net charge-offs as a percent of average loans and leases, excluding PPP loans (annualized)(4) 0.11%  0.13% (0.06)%    
    Allowance for credit losses as a percent of nonperforming loans(4) 289.98%  269.23%  167.67%    
    Allowance for credit losses as a percent of end-of-period loans and leases(4) 1.35%  1.31%  1.35%    
    Allowance for credit losses as a percent of end-of-period loans and leases, excluding PPP loans(4) 1.35%  1.31%  1.37%    
    CAPITAL RATIOS         
    Shareholders' equity as a percent of total assets 10.7%  10.7%  11.6%    
    Tangible common equity as a percent of tangible assets(12) 7.8%  7.7%  8.6%    
    Tangible common equity as a percent of tangible assets, excluding PPP loans(12) 7.8%  7.7%  8.7%    
    Leverage Ratio 10.2%  10.1%  9.7%    
    Risk Based Capital - Tier I 12.0
    		%  12.1%  12.2%    
    Risk Based Capital - Total 14.4%  14.5%  14.6%    
    Common Equity - Tier I 11.1%  11.2%  11.3%    


    FIRST COMMONWEALTH FINANCIAL CORPORATION    
    CONSOLIDATED FINANCIAL DATA      
    Unaudited      
    (dollars in thousands, except per share data)      
     For the Three Months Ended For the Years Ended
     December 31,September 30,December 31, December 31,December 31,
      2022  2022 2021   2022  2021 
    INCOME STATEMENT      
    Interest income$96,281 $85,700$73,530  $329,953 $293,838 
    Interest expense 8,254  3,340 3,276   17,732  15,297 
    Net Interest Income 88,027  82,360 70,254   312,221  278,541 
    Provision for credit losses 9,120  5,923 (2,729)  21,106  (1,376)
    Net Interest Income after Provision for Credit Losses 78,907  76,437 72,983   291,115  279,917 
    Net securities gains —  — —   2  16 
    Trust income 2,455  2,777 2,771   10,518  11,111 
    Service charges on deposit accounts 4,946  5,194 4,857   19,641  17,984 
    Insurance and retail brokerage commissions 2,051  2,048 2,134   8,857  8,502 
    Income from bank owned life insurance 1,149  1,419 1,487   5,459  6,433 
    Gain on sale of mortgage loans 948  1,485 1,940   5,276  13,555 
    Gain on sale of other loans and assets 1,525  1,093 1,849   6,036  8,130 
    Card-related interchange income 6,996  6,980 7,069   27,603  27,954 
    Derivative mark-to-market (27) 6 973   368  2,344 
    Swap fee income 752  2,326 828   4,685  2,543 
    Other income 3,514  2,586 2,163   10,263  8,185 
    Total Noninterest Income 24,309  25,914 26,071   98,708  106,757 
    Salaries and employee benefits 31,664  32,486 31,422   126,031  119,506 
    Net occupancy 4,451  4,629 3,972   18,037  16,586 
    Furniture and equipment 3,990  4,005 3,776   15,582  15,642 
    Data processing 3,543  3,721 2,933   13,922  12,373 
    Pennsylvania shares tax 960  1,569 1,257   4,447  4,604 
    Advertising and promotion 1,093  1,278 1,154   5,031  4,983 
    Intangible amortization 726  746 900   3,196  3,497 
    Other professional fees and services 1,272  1,204 1,351   4,894  4,501 
    FDIC insurance 675  796 565   2,871  2,529 
    Litigation and operational losses 847  758 700   2,834  2,324 
    Loss on sale or write-down of assets 128  54 80   343  303 
    Merger and acquisition 1,254  448 —   1,702  — 
    COVID-19 related 33  39 92   151  449 
    Branch consolidation —  — (121)  (104) (103)
    Other operating expenses 7,698  8,168 7,347   30,701  26,663 
    Total Noninterest Expense 58,334  59,901 55,428   229,638  213,857 
    Income before Income Taxes 44,882  42,450 43,626   160,185  172,817 
    Income tax provision 9,149  8,482 8,850   32,004  34,560 
    Net Income$35,733 $33,968$34,776  $128,181 $138,257 
           
    Shares Outstanding at End of Period 93,376,314  93,377,064 94,233,152   93,376,314  94,233,152 
    Average Shares Outstanding Assuming Dilution 93,489,398  93,450,259 95,020,353   93,887,447  95,840,285 
           


    FIRST COMMONWEALTH FINANCIAL CORPORATION   
    CONSOLIDATED FINANCIAL DATA     
    Unaudited     
    (dollars in thousands)     
          
     December 31, September 30, December 31,
      2022   2022   2021 
    BALANCE SHEET (Period End)     
    Assets     
    Cash and due from banks$124,254  $106,153  $84,738 
    Interest-bearing bank deposits 29,990   74,619   310,634 
    Securities available for sale, at fair value 789,075   802,871   1,054,218 
    Securities held to maturity, at amortized cost 461,162   474,790   541,311 
    Loans held for sale 11,869   13,811   18,583 
          
    Loans and leases 7,642,143   7,348,917   6,839,230 
    Allowance for credit losses (102,906)  (96,093)  (92,522)
    Net loans and leases 7,539,237   7,252,824   6,746,708 
          
    Goodwill and other intangibles 312,533   312,950   314,516 
    Other assets 537,546   540,612   474,385 
    Total Assets$9,805,666  $9,578,630  $9,545,093 
          
    Liabilities and Shareholders' Equity     
    Noninterest-bearing demand deposits$2,670,508  $2,782,654  $2,658,782 
          
    Interest-bearing demand deposits 357,769   354,310   291,476 
    Savings deposits 4,572,183   4,608,762   4,647,197 
    Time deposits 405,009   331,923   385,043 
    Total interest-bearing deposits 5,334,961   5,294,995   5,323,716 
          
    Total deposits 8,005,469   8,077,649   7,982,498 
          
    Short-term borrowings 372,694   97,932   138,315 
    Long-term borrowings 181,224   181,489   182,269 
    Total borrowings 553,918   279,421   320,584 
          
    Other liabilities 194,205   198,985   132,639 
    Shareholders' equity 1,052,074   1,022,575   1,109,372 
    Total Liabilities and Shareholders' Equity$9,805,666  $9,578,630  $9,545,093 


    FIRST COMMONWEALTH FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands)


     For the Three Months Ended For the Years Ended
     December 31,Yield/September 30,Yield/December 31,Yield/ December 31,Yield/December 31,Yield/
      2022Rate 2022Rate 2021Rate  2022Rate 2021Rate
    NET INTEREST MARGIN          
                
    Assets           
    Loans and leases, excluding PPP loans (FTE)(1)(3)$7,486,8224.76%$7,254,5944.30%$6,680,3463.73% $7,151,9984.20%$6,464,4463.80%
    PPP Loans 4,5302.89% 7,19614.61% 111,54414.44%  20,62612.91% 312,7467.41%
    Securities and interest-bearing bank deposits (FTE) (1) 1,286,5612.08% 1,446,3151.92% 1,878,7551.46%  1,567,2661.78% 1,809,4171.46%
    Total Interest-Earning Assets (FTE) (1) 8,777,9134.36% 8,708,1053.92% 8,670,6453.38%  8,739,8903.79% 8,586,6093.43%
    Noninterest-earning assets 863,049  825,989  815,872   835,343  807,455 
    Total Assets$9,640,962 $9,534,094 $9,486,517  $9,575,233 $9,394,064 
                
    Liabilities and Shareholders' Equity           
    Interest-bearing demand and savings deposits$4,884,2360.29%$4,952,2790.07%$4,882,3180.06% $4,970,8350.11%$4,812,0040.07%
    Time deposits 345,7490.57% 336,3460.24% 395,4440.31%  352,6220.34% 449,4520.49%
    Short-term borrowings 264,9872.86% 102,0730.19% 126,6950.07%  144,8341.38% 119,8010.08%
    Long-term borrowings 181,3334.96% 181,5964.94% 182,3714.91%  181,7244.96% 200,9614.70%
    Total Interest-Bearing Liabilities 5,676,3050.58% 5,572,2940.24% 5,586,8280.23%  5,650,0150.31% 5,582,2180.27%
    Noninterest-bearing deposits 2,729,716  2,746,258  2,652,812   2,708,580  2,580,460 
    Other liabilities 193,685  152,208  130,373   147,871  130,007 
    Shareholders' equity 1,041,256  1,063,334  1,116,504   1,068,767  1,101,379 
    Total Noninterest-Bearing Funding Sources 3,964,657  3,961,800  3,899,689   3,925,218  3,811,846 
    Total Liabilities and Shareholders' Equity$9,640,962 $9,534,094 $9,486,517  $9,575,233 $9,394,064 
                
    Net Interest Margin (FTE) (annualized)(1) 3.99% 3.76% 3.23%  3.58% 3.26%


    FIRST COMMONWEALTH FINANCIAL CORPORATION 
    CONSOLIDATED FINANCIAL DATA   
    Unaudited   
    (dollars in thousands)   
     December 31,September 30,December 31,
      2022  2022  2021 
    Loan and Lease Portfolio Detail   
    Commercial Loan and Lease Portfolio:   
    Commercial, financial, agricultural and other$1,127,778 $1,120,499 $1,102,154 
    Paycheck Protection Program 4,254  4,930  71,298 
    Commercial real estate 2,425,012  2,393,276  2,251,097 
    Equipment Finance loans and leases 79,674  43,777  — 
    Real estate construction 395,439  326,539  382,764 
    Total Commercial 4,032,157  3,889,021  3,807,313 
        
    Consumer Loan Portfolio:   
    Closed-end mortgages 1,682,092  1,631,655  1,368,816 
    Home equity lines of credit 512,577  522,249  551,434 
    Real estate construction 117,662  96,151  111,692 
    Total Real Estate - Consumer 2,312,331  2,250,055  2,031,942 
        
    Auto & RV loans 1,210,451  1,120,838  901,280 
    Direct installment 31,938  33,528  40,937 
    Personal lines of credit 51,514  51,514  52,809 
    Student loans 3,752  3,961  4,949 
    Total Other Consumer 1,297,655  1,209,841  999,975 
    Total Consumer Portfolio 3,609,986  3,459,896  3,031,917 
      Total Portfolio Loans and Leases 7,642,143  7,348,917  6,839,230 
    Loans held for sale 11,869  13,811  18,583 
      Total Loans and Leases$7,654,012 $7,362,728 $6,857,813 
        
        
     December 31,September 30,December 31,
      2022  2022  2021 
    ASSET QUALITY DETAIL   
    Nonperforming Loans:   
    Loans on nonaccrual basis$20,193 $20,495 $34,926 
    Loans held for sale on a nonaccrual basis —  —  — 
    Troubled debt restructured loans on nonaccrual basis 8,852  8,981  13,134 
    Troubled debt restructured loans on accrual basis 6,442  6,216  7,120 
        Total Nonperforming Loans$35,487 $35,692 $55,180 
    Other real estate owned ("OREO") 534  322  642 
    Repossessions ("Repos") 454  600  397 
        Total Nonperforming Assets$36,475 $36,614 $56,219 
    Loans past due in excess of 90 days and still accruing 1,991  1,548  1,606 
    Classified loans 44,447  45,656  77,563 
    Criticized loans 132,863  139,258  198,126 
        
    Nonperforming assets as a percentage of total loans and leases, plus OREO and Repos(4) 0.48% 0.50% 0.82%
    Allowance for credit losses$102,906 $96,093 $92,522 
        


    FIRST COMMONWEALTH FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands)


     For the Three Months Ended For the Years Ended
     December 31,September 30,December 31, December 31,December 31,
      2022  2022  2021   2022  2021 
    Net Charge-offs (Recoveries):      
    Commercial, financial, agricultural and other$444 $698 $(1,633) $1,967 $4,590 
    Real estate construction —  (9) (11)  (9) (146)
    Commercial real estate 182  1,003  (5)  1,718  1,524 
    Residential real estate 32  36  20   152  (159)
    Loans to individuals 1,356  733  565   3,309  2,601 
    Net Charge-offs$2,014 $2,461 $(1,064) $7,137 $8,410 
           
    Net charge-offs as a percentage of average loans outstanding (annualized)(4) 0.11% 0.13%(0.06)%  0.10% 0.12%
    Net charge-offs as a percentage of average loans outstanding, excluding PPP loans (annualized)(4) 0.11% 0.13%(0.06)%  0.10% 0.13%
    Provision for credit losses as a percentage of net charge-offs 452.83% 240.67% 256.48%  295.73%(16.36)%
    Provision for credit losses$9,120 $5,923 $(2,729) $21,106 $(1,376)


    DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES   
    Note: Management believes that it is standard practice in the banking industry to present these non-GAAP measures. These measures provide useful information to management and investors by allowing them to make peer comparisons.
           
    (1) Net interest income has been computed on a fully taxable equivalent basis ("FTE") using the federal income tax statutory rate of 21%.
    (2) Core efficiency ratio excludes from total revenue the impact of derivative mark-to-market and excludes from "total noninterest expense" the amortization of intangibles, unfunded commitment expense and any other unusual items deemed by management to not be related to normal operations, such as merger, acquisition and severance costs.
    (3) Includes held for sale loans.  
    (4) Excludes held for sale loans.  
     For the Three Months Ended For the Years Ended
     December 31,September 30,December 31, December 31,December 31,
      2022 2022 2021  2022 2021
           
    Interest income$96,281$85,700$73,530 $329,953$293,838
    Adjustment to fully taxable equivalent basis (1) 290 261 266  1,049 1,100
    Interest income adjusted to fully taxable equivalent basis (non-GAAP) 96,571 85,961 73,796  331,002 294,938
    Interest expense 8,254 3,340 3,276  17,732 15,297
    Net interest income, (FTE) (1)$88,317$82,621$70,520 $313,270$279,641


    FIRST COMMONWEALTH FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)


    DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES   
           
     For the Three Months Ended For the Years Ended
     December 31,September 30,December 31, December 31,December 31,
      2022  2022  2021   2022  2021 
           
    Net Income$35,733 $33,968 $34,776  $128,181 $138,257 
    Intangible amortization 726  746  900   3,196  3,497 
    Tax benefit of amortization of intangibles (152) (157) (189)  (671) (734)
    Net Income, adjusted for tax affected amortization of intangibles$36,307 $34,557 $35,487  $130,706 $141,020 
           
    Average Tangible Equity:      
    Total shareholders' equity$1,041,256 $1,063,334 $1,116,504  $1,068,767 $1,101,379 
    Less: intangible assets 312,634  313,336  314,860   313,451  315,589 
    Tangible Equity 728,622  749,998  801,644   755,316  785,790 
    Less: preferred stock —  —  —   —  — 
    Tangible Common Equity$728,622 $749,998 $801,644  $755,316 $785,790 
           
    (8)Return on Average Tangible Common Equity 19.77% 18.28% 17.56%  17.30% 17.95%
           


     For the Three Months Ended For the Years Ended
     December 31,September 30,December 31, December 31,December 31,
      2022  2022  2021   2022  2021 
           
    Core Net Income:      
    Total Net Income$35,733 $33,968 $34,776  $128,181 $138,257 
    Net securities gains —  —  —   (2) (16)
    Tax benefit of net securities gains —  —  —   —  3 
    Merger & acquisition related expenses 1,254  448  —   1,702  — 
    Tax benefit of merger & acquisition related expenses (263) (94) —   (357) — 
    COVID-19 related 33  39  92   151  449 
    Tax benefit of COVID 19 related (7) (8) (19)  (32) (94)
    Branch consolidation related —  —  (121)  (104) (103)
    Tax benefit of bank consolidation related expenses —  —  25   22  22 
    (5) Core net income$36,750 $34,353 $34,753  $129,561 $138,518 
    Average Shares Outstanding Assuming Dilution 93,489,398  93,450,259  95,020,353   93,887,447  95,840,285 
    (6) Core Earnings per common share (diluted)$0.39 $0.37 $0.37  $1.38 $1.45 
           
    Intangible amortization 726  746  900   3,196  3,497 
    Tax benefit of amortization of intangibles (152) (157) (189)  (671) (734)
      Core Net Income, adjusted for tax affected amortization of intangibles$37,324 $34,942 $35,464  $132,086 $141,281 
           
    (9) Core Return on Average Tangible Common Equity 20.32% 18.48% 17.55%  17.49% 17.98%


    FIRST COMMONWEALTH FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)


    DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES     
           
     For the Three Months Ended For the Years Ended
     December 31,September 30,December 31, December 31,December 31,
      2022  2022  2021   2022  2021 
    Core Return on Average Assets:      
    Total Net Income$35,733 $33,968 $34,776  $128,181 $138,257 
    Total Average Assets 9,640,962  9,534,094  9,486,517   9,575,233  9,394,064 
    Return on Average Assets 1.47% 1.41% 1.45%  1.34% 1.47%
           
    Core Net Income (5)$36,750 $34,353 $34,753  $129,561 $138,518 
    Total Average Assets 9,640,962  9,534,094  9,486,517   9,575,233  9,394,064 
    (7) Core Return on Average Assets 1.51% 1.43% 1.45%  1.35% 1.47%


     For the Three Months Ended For the Years Ended
     December 31,September 30,December 31, December 31,December 31,
      2022  2022  2021   2022  2021 
    Core Efficiency Ratio:      
    Total Noninterest Expense$58,334 $59,901 $55,428  $229,638 $213,857 
    Adjustments to Noninterest Expense:      
    Intangible amortization 726  746  900   3,196  3,497 
    Merger and acquisition related 1,254  448  —   1,702  — 
    COVID-19 related 33  39  92   151  449 
    Branch consolidation related —  —  (121)  (104) (103)
      Noninterest Expense - Core$56,321 $58,668 $54,557  $224,693 $210,014 
           
    Net interest income, (FTE)$88,317 $82,621 $70,520  $313,270 $279,641 
    Total noninterest income 24,309  25,914  26,071   98,708  106,757 
    Net securities gains —  —  —   (2) (16)
    Total Revenue 112,626  108,535  96,591   411,976  386,382 
           
    Adjustments to Revenue:      
    Derivative mark-to-market (27) 6  973   368  2,344 
      Total Revenue - Core$112,653 $108,529 $95,618  $411,608 $384,038 
           
    (10) Core Efficiency Ratio 50.00% 54.06% 57.06%  54.59% 54.69%


    FIRST COMMONWEALTH FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands)


    DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES  
        
     December 31,September 30,December 31,
      2022  2022  2021 
    Tangible Equity:   
    Total shareholders' equity$1,052,074 $1,022,575 $1,109,372 
    Less: intangible assets 312,533  312,950  314,516 
    Tangible Equity 739,541  709,625  794,856 
    Less: preferred stock —  —  — 
    Tangible Common Equity$739,541 $709,625 $794,856 
        
    Tangible Assets:   
    Total assets$9,805,666 $9,578,630 $9,545,093 
    Less: intangible assets 312,533  312,950  314,516 
    Tangible Assets$9,493,133 $9,265,680 $9,230,577 
    Less: PPP loans 4,254  4,930  71,298 
    Tangible Assets, excluding PPP loans$9,488,879 $9,260,750 $9,159,279 
        
    (12)Tangible Common Equity as a percentage of Tangible Assets 7.79% 7.66% 8.61%
    (12)Tangible Common Equity as a percentage of Tangible Assets, excluding PPP loans 7.79% 7.66% 8.68%
        
    Shares Outstanding at End of Period 93,376,314  93,377,064  94,233,152 
    (11)Tangible Book Value Per Common Share$7.92 $7.60 $8.43 


     For the Three Months Ended For the Years Ended
     December 31,September 30,December 31, December 31,December 31,
      2022 2022 2021   2022  2021 
    Pre-tax pre-provision income:      
    Net interest income$88,027$82,360$70,254  $312,221 $278,541 
    Noninterest income 24,309 25,914 26,071   98,708  106,757 
    Noninterest expense 58,334 59,901 55,428   229,638  213,857 
    Pre-tax pre-provision income$54,002$48,373$40,897  $181,291 $171,441 
           
    Net securities gains$—$—$—  $(2)$(16)
    Merger and acquisition related expenses 1,254 448 0   1,702  0 
    COVID-19 related 33 39 92   151  449 
    Branch consolidation — — (121)  (104) (103)
    Core pre-tax pre-provision income$55,289$48,860$40,868  $183,038 $171,771 
           
    Net charge-offs$2,014$2,461$(1,064) $7,137 $8,410 


    FIRST COMMONWEALTH FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands)


    DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES  
           
     For the Three Months Ended For the Years Ended
     December 31,September 30,December 31, December 31,December 31,
      2022  2022  2021   2022  2021 
    Core Net Interest Margin:      
    Net Interest Income (FTE)$88,317 $82,621 $70,520  $313,270 $279,641 
    Less: Income from PPP Loans 33  265  4,059   2,663  23,184 
    Less: Income from Excess Cash 302  538  100   1,660  390 
    Core Net Interest Income (FTE)$87,982 $81,818 $66,361  $308,947 $256,067 
           
    Average Interest-Earning Assets$8,777,913 $8,708,105 $8,670,645  $8,739,890 $8,586,609 
    Less: PPP Loans 4,530  7,196  111,544   20,626  312,746 
    Less: Excess Cash 27,091  99,707  241,426   181,568  309,626 
    Core Average Interest-Earning Assets$8,746,292 $8,601,202 $8,317,675  $8,537,696 $7,964,237 
           
    Core Net Interest Margin (Non-GAAP) 3.99% 3.77% 3.17%  3.62% 3.22%

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