The Herald, Sharon, Pa.

January 22, 2014

FNB cites merger-related expenses

By Michael Roknick
Herald Business Editor

HERMITAGE — FNB Corp. reported its earnings were down slightly for the fourth quarter due mainly to merger-related expenses, but were up overall for 2013.

The Hermitage-based finanancial institution earned $28.4 million, or 18 cents a diluted common share, compared to the same year-ago earnings of $29 million, or 21 cents a diluted share.

Earnings for all of 2014 totaled $117.8 million, or 80 cents a diluted common share, compared to earnings of $110.4 million, or 79 cents per diluted common share.

“FNB has completed another year highlighted by growth and success,’’ said Vincent J. Delie, FNB’s president and chief executive officer in a news release. “We maintained a high-quality earnings stream, despite significant regulatory-related revenue impacts and expense burden, and achieved several strategic company milestones. These accomplishments will mark 2013 as a transformational year. As we enter 2014, we have an expanded footprint in Baltimore, Maryland, and Cleveland, Ohio, and we are excited about our future potential in these dynamic markets.’’

Delie noted the company has an expanded footpring in Baltimore, Maryland and Cleveland, and was excited about its future potential in those markets.  

“We are also very optimistic about our prospects across our core markets,’’ Delie said. “Our capital structure is strengthened following the actions undertaken during the year and we continue to attract some of the most talented bankers in our markets.’’

Among the highlights of 2013 for FNB include:

• Loan growth momentum continued, with annualized average organic loan growth on a linked-quarter basis of $129 million or 5.9 percent annualized.  

• The net interest margin expanded to 3.67 percent from 3.64 percent in the prior quarter.

• The company completed the purchase of PVF Capital Corp. which has 16 offices in the greater Cleveland area.

• Completed a capital offering, raising net proceeds of $161.3 million by issuing preferred and common stock.

Non-interest expenses totaled $92.1 million, and included merger-related costs of $4 million and a loss on the early extinguishment of debt with trust preferred securities redemption costs of $2.2 million. When excluding these non-operating costs and the $900,000 million in merger costs in the prior quarter, non-interest expense increased $3.6 million or 4.4 percent. The increase primarily reflects the additional operating costs of PVFC during the fourth quarter. In addition, salaries and employee benefits included higher employee medical insurance of $1.1 million due to elevated claims experienced during the quarter, other real estate owned expense was elevated by $1.7 million primarily due to the write-down of one property and amortization of intangibles increased following the addition of PVFC.  

FNB is a regional diversified financial services company operating in six states. The company is best known for its flagship affiliate, First National Bank of Pennsylvania, which also is based in Hermitage.