First Commonwealth Financial Corp (FCF, Financial) announced its financial results for the third quarter of 2023 on October 24, 2023. The company reported a net income of $39.2 million and diluted earnings per share of $0.38. This represents a decrease of $3.6 million, or $0.04 per share, from the prior quarter but an increase of $5.3 million, or $0.02 per share, from the third quarter of 2022.
Financial Performance
The company's core pre-tax pre-provision net revenue (PPNR) totaled $55.7 million, a decrease of $0.7 million from the previous quarter but an increase of $6.8 million from the third quarter of 2022. The provision for credit losses was $5.9 million, an increase of $3.1 million compared to the previous quarter. The net interest margin for the third quarter of 2023 was 3.76%, a decrease of 9 basis points compared to the prior quarter but unchanged compared to the third quarter of 2022.
Asset Quality and Capital Position
The provision for credit losses in the third quarter of 2023 totaled $5.9 million, an increase from $2.8 million in the previous quarter. The allowance for credit losses as a percentage of end-of-period loans was 1.51%, a decrease of 1 basis point from the previous quarter. Total available liquidity stood at $4.4 billion at the end of September 2023, with a Bank-level Tier 1 Capital ratio of 10.8%.
Company's Commentary
Our results this quarter were strong and overcame 9 basis points of net interest margin compression. Fortunately, the pace of increases in our funding costs continued to moderate throughout the third quarter while loan yields continue to improve,” stated T. Michael Price (Trades, Portfolio), President and Chief Executive Officer. “I am also enthusiastic about where we are at as a company. We continue to improve our businesses each and every quarter, despite a challenging macro-economic environment for banks this year. Our asset quality, liquidity and capital also remain strong and will enable us to continue our journey of becoming the best bank for our neighbors and their businesses.”
Looking Ahead
First Commonwealth Financial Corp (FCF, Financial) remains committed to its strategic growth and profitability objectives. The company's strong capital and liquidity positions, coupled with its robust asset quality, provide a solid foundation for future growth. Despite the challenging macro-economic environment, FCF continues to improve its businesses and is well-positioned to navigate the evolving financial landscape.
