FNB CORP/PA/

Previous wording

This MD&A represents an overview of and highlights material changes to our financial condition and consolidated results of operations at and for the nine-month periods ended September 30, 2025 and 2024. This MD&A should be read in conjunction with the Consolidated Financial Statements and Notes thereto contained herein and our 2024 Annual Report on Form 10-K filed with the SEC on February 27, 2025. Our results of operations for the nine months ended September 30, 2025 are not necessarily indicative of results expected for the full year.

Current wording

This MD&A represents an overview of, and highlights, material changes to our financial condition and consolidated results of operations at and for the three-month periods ended March 31, 2026 and 2025. This MD&A should be read in conjunction with the Consolidated Financial Statements and Notes thereto contained herein and our 2025 Annual Report on Form 10-K filed with the SEC on February 24, 2026. Our results of operations for the three months ended March 31, 2026 are not necessarily indicative of results expected for the full year.

Previous wording

•changes in market interest rates, the U.S. federal government shutdown and the unpredictability of monetary, tax and other policies of government agencies, including tariffs or the imposition of new tariffs, trade wars, barriers or restrictions, or threats of such actions;

Current wording

•changes in market interest rates, U.S. federal government shutdowns and the unpredictability of monetary, tax and other policies of government agencies, including tariffs or the imposition and enforceability of tariffs, trade wars, barriers or restrictions, threats of such actions or related uncertainties;

Previous wording

•changes and instability in economic conditions and financial markets, in the regions in which we operate or otherwise, including a contraction of economic activity, economic downturn or uncertainty and international conflict;

Current wording

•changes and instability in economic conditions and financial markets, in the regions in which we operate or otherwise, including a contraction of economic activity, economic downturn or uncertainty and international conflict, including in the Middle East, disruption of supply chain and energy supply markets and capital markets, changes to inflation expectations and other related uncertainties;

Previous wording

We caution that the risks identified here are not exhaustive of the types of risks that may adversely impact us and actual results may differ materially from those expressed or implied as a result of these risks and uncertainties, including, but not limited to, the risk factors and other uncertainties described under Item 1A. Risk Factors and the Risk Management sections of our 2024 Annual Report on Form 10-K (including the MD&A section), our subsequent 2025 Quarterly Reports on Form 10-Q (including the risk factors and risk management discussions) and our other 2025 filings with the SEC, which are available on our corporate website at https://www.fnb-online.com/about-us/investor-information/reports-and-filings or the SEC's website at www.sec.gov. We have included our web address as an inactive textual reference only. Information on our website is not part of our SEC filings.

Current wording

We caution that the risks identified here are not exhaustive of the types of risks that may adversely impact us and actual results may differ materially from those expressed or implied as a result of these risks and uncertainties, including, but not limited to, the risk factors and other uncertainties described under Item 1A. Risk Factors and the Risk Management sections of our 2025 Annual Report on Form 10-K (including the MD&A section) and our other 2026 filings with the SEC, which are available on our corporate website at https://www.fnb-online.com/about-us/investor-information/reports-and-filings or the SEC's website at www.sec.gov. We have included our web address as an inactive textual reference only. Information on our website is not part of our SEC filings.

Previous wording

You should treat forward-looking statements as speaking only as of the date they are made and based only on information then actually known to us. We do not undertake, and specifically disclaim any obligation, to update or revise any forward-looking statements to reflect the occurrence of events or circumstances after the date of such statements except as required by law.

Current wording

You should treat forward-looking statements as speaking only as of the date they are made and based only on information then actually known to us. We do not undertake, and specifically disclaims any obligation, to update or revise any forward-looking statements to reflect the occurrence of events or circumstances after the date of such statements except as required by law.

Previous wording

To supplement our Consolidated Financial Statements presented in accordance with GAAP, we use certain non-GAAP financial measures, such as operating net income available to common shareholders, operating earnings per diluted common share, return on average tangible common equity, return on average tangible assets, tangible book value per common share, the ratio of tangible common equity to tangible assets, operating non-interest expense, pre-provision net revenue (reported), operating pre-provision net revenue, efficiency ratio and net interest margin (FTE) to provide information useful to investors in understanding our operating performance and trends, and to facilitate comparisons with the performance of our peers. Management uses these measures internally to assess and better understand our underlying business performance and trends related to core business activities. The non-GAAP financial measures and key performance indicators we use may differ from the non-GAAP financial measures and key performance indicators other financial institutions use to assess their performance and trends.

Current wording

To supplement our Consolidated Financial Statements presented in accordance with GAAP, we use certain non-GAAP financial measures, such as return on average tangible common equity, return on average tangible assets, tangible book value per common share, the ratio of tangible common equity to tangible assets, pre-provision net revenue (reported), efficiency ratio and net interest margin (FTE) to provide information useful to investors in understanding our operating performance and trends, and to facilitate comparisons with the performance of our peers. Management uses these measures internally to assess and better understand our underlying business performance and trends related to core business activities. The non-GAAP financial measures and key performance indicators we use may differ from the non-GAAP financial measures and key performance indicators other financial institutions use to assess their performance and trends.

Previous wording

Net interest income totaled $359.3 million, an increase of $35.9 million, or 11.1%, reflecting growth in earning assets and lower interest-bearing deposit costs, partially offset by lower yields on earning assets. The net interest margin (FTE) (non-GAAP) increased 17 basis points to 3.25%. The provision for credit losses was $24.0 million, compared to $23.4 million. Non-interest income increased $8.5 million, or 9.5%, primarily due to increases in mortgage banking operations income, capital markets income, wealth management revenue and other non-interest income. Non-interest expense for the third quarter of 2025 decreased $5.9 million, or 2.4%. On an operating basis, non-interest expense (non-GAAP) increased $11.6 million, or 5.0%, when excluding significant items of $(2.3) million in the third quarter of 2025 and $15.3 million in the same quarter of 2024.

Current wording

•Net interest income totaled $359.3 million, an increase of $35.4 million, or 10.9%, from the year-ago quarter, reflecting growth in average earning assets and lower interest-bearing deposit costs, partially offset by lower yields on earning assets.

Previous wording

•Pre-provision net revenue (non-GAAP) totaled $213.9 million, an 11.4% increase from the prior quarter, driven by continued strong non-interest income generation, growth in net interest income and well-managed non-interest expense.

Current wording

•Total revenue totaled $450.3 million, a 9.4% increase from the year-ago quarter, driven by continued solid non-interest income generation and growth in net interest income.

Previous wording

•The provision for credit losses was $24.0 million, a decrease of $1.6 million from the prior quarter, with net charge-offs of $19.7 million, or 0.22% annualized of total average loans, compared to $21.8 million, or 0.25% annualized, in the prior quarter, reflecting continued proactive management of the loan portfolio.

Current wording

•The provision for credit losses was $18.5 million, an increase of 5.6% from the year-ago quarter, with net charge-offs of $15.9 million, or 0.18% annualized of total average loans, compared to $12.5 million, or 0.15% annualized, in the year-ago quarter, reflecting continued proactive management of the loan portfolio.

Previous wording

•For the quarter ending September 30, 2025 average loans and leases totaled $34.8 billion, an increase of $1.0 billion, or 3.0%, over the quarter ending September 30, 2024, primarily driven by consumer loan growth of $994.7 million.

Current wording

•For the quarter ending March 31, 2026, average loans and leases totaled $34.9 billion, an increase of $849.4 million, or 2.5%, over the quarter ending March 31, 2025, primarily driven by average consumer loan growth of $1.1 billion, partially offset by a decrease of $219.0 million in average commercial loans and leases. In December 2025, we transferred approximately $200 million of performing residential mortgage loans to held-for-sale in anticipation of a loan sale that closed in February 2026 as part of balance sheet management actions.

Previous wording

•The loan-to-deposit ratio was 91% at September 30, 2025, a slight improvement compared to 92% for both June 30, 2025 and September 30, 2024.

Current wording

•The loan-to-deposit ratio was 90.3% at March 31, 2026, compared to 89.7% at December 31, 2025 and 91.9% at March 31, 2025.

Previous wording

•The ratio of non-performing loans plus OREO to total loans and leases plus OREO increased 3 basis points from the prior quarter to 0.37%. The ratio was 0.39%, or a decrease of 2 basis points compared to September 30, 2024. Total delinquency decreased 14 basis points to 0.65%, compared to 0.79% at September 30, 2024, and increased 3 basis points from the prior quarter. The overall asset quality metrics remain at solid levels, reflecting continued proactive management of the loan portfolio.

Current wording

•The ratio of non-performing loans plus OREO to total loans and leases plus OREO increased 3 basis points from the prior quarter to 0.34%. Compared to March 31, 2025, the ratio decreased 14 basis points. Total delinquency decreased 1 basis point to 0.74%, compared to 0.75% at March 31, 2025, and increased 3 basis points from the prior quarter. The overall asset quality metrics remain at solid levels, reflecting continued proactive management of the loan portfolio.

Previous wording

•The ACL on loans and leases was $437.3 million, an increase of $17.1 million compared to September 30, 2024, driven primarily by loan growth, with the ratio of the ACL to total loans and leases remaining stable at 1.25%.

Current wording

•The ACL on loans and leases was $443.0 million, an increase of $14.2 million compared to March 31, 2025, driven primarily by loan growth, with the ratio of the ACL to total loans and leases increasing 1 basis point to 1.26%.

Previous wording

•Tangible book value per common share (non-GAAP) of $11.48 increased 11.1% compared to September 30, 2024, and 3.1% compared to June 30, 2025. AOCI reduced the tangible book value per common share (non-GAAP) by $0.22 as of September 30, 2025, primarily due to the impact of unrealized losses on AFS securities, compared to a reduction of $0.43 as of September 30, 2024, and $0.26 as of June 30, 2025.

Current wording

•Tangible book value per common share (non-GAAP) of $12.06 increased 11.4% compared to March 31, 2025, and 1.6% compared to December 31, 2025. Reflecting the impact of unrealized losses on AFS securities. AOCI reduced the tangible book value per common share (non-GAAP) by $0.24 as of March 31, 2026, compared to a reduction of $0.34 as of March 31, 2025, and $0.18 as of December 31, 2025.

Previous wording

•Record capital levels with the CET1 capital ratio at 11.1% compared to 10.4% at September 30, 2024, and 10.8% at June 30, 2025. The tangible common equity to tangible assets ratio (non-GAAP) was also a record at 8.7%, compared to 8.2% at September 30, 2024, and 8.5% at June 30, 2025.

Current wording

•The CET1 capital ratio was 11.4%, compared to 10.7% at March 31, 2025 and 11.4% at December 31, 2025. The tangible common equity to tangible assets ratio (non-GAAP) was 8.9%, compared to 8.4% at March 31, 2025 and 8.9% at December 31, 2025.

Previous wording

Net interest income totaled $1.0 billion, an increase of $72.1 million, or 7.5%, compared to $958.2 million, reflecting growth in earning assets, partially offset by balance growth in higher yielding deposit products. The net interest margin (FTE) (non-GAAP) increased 5 basis points to 3.16%. Total cost of funds decreased 19 basis points to 2.27% with a 26 basis point decrease in interest-bearing deposit costs to 2.69% and a 34 basis point decrease in total borrowing costs. The yield on earning assets (non-GAAP) declined 14 basis points to 5.31%, driven by a 22 basis point decline in yields on loans to 5.75%, offset by a 35 basis point increase in yields on investment securities to 3.48%, benefiting from balance sheet restructuring activities in 2024. The provision for credit losses for the first nine months of 2025 totaled $67.1 million, compared to $57.5 million. Net charge-offs for the first nine months of 2025 totaled $54.0 million, or 0.21% annualized of total average loans, compared to $42.1 million, or 0.17% annualized. Non-interest income totaled $277.0 million, compared to $265.5 million, reflecting increased mortgage banking operations income, capital markets income, wealth management revenue and other non-interest income. Non-interest expense totaled $736.6 million, increasing $23.4 million, or 3.3%. On an operating basis (non-GAAP), non-interest expense increased $44.8 million, or 6.5%, compared to the first nine months of 2024 as the year-ago period included significant items impacting earnings of $19.1 million. Salaries and benefits increased $20.4 million, or 5.4%, primarily reflecting strategic hiring, continued investments in our risk management infrastructure and higher production-related compensation. Additionally, net occupancy and equipment expense increased $5.6 million, or 4.2%, and outside services increased $7.2 million, or 10.2%, offset by an FDIC insurance expense decline of $8.9 million due to the special assessment expense of $5.2 million in 2024, combined with the $2.3 million reduction to the special assessment in the third quarter of 2025.

Current wording

Net interest income totaled $359.3 million, an increase of $35.4 million, or 10.9%, compared to $323.8 million, reflecting growth in average earning assets and lower interest-bearing deposit costs, partially offset by balance growth in higher yielding deposit products. The net interest margin (FTE) (non-GAAP) increased 22 basis points to 3.25%. Total cost of funds decreased 31 basis points to 2.01% with a 36 basis point decrease in interest-bearing deposit costs to 2.40% and a 57 basis point decrease in total borrowing costs. The yield on earning assets (non-GAAP) declined 9 basis points to 5.14%, driven by a 12 basis point decline in yields on loans to 5.56%, offset by a 13 basis point increase in yields on investment securities to 3.54%. The FOMC has lowered the target federal funds rate by 175 basis points since August 2024. The provision for credit losses for the first three months of 2026 totaled $18.5 million, compared to $17.5 million. Net charge-offs for the first three months of 2026 totaled $15.9 million, or 0.18% annualized of total average loans, compared to $12.5 million, or 0.15% annualized. Non-interest income totaled $91.0 million, compared to $87.8 million, reflecting increased capital markets income, wealth management revenue and other non-interest income. Non-interest expense totaled $257.9 million, increasing $11.1 million, or 4.5%. Net occupancy and equipment expense increased $5.1 million, or 11.1%, primarily due to technology-related investments and higher occupancy costs, which included unusually high seasonal snow removal costs.

Previous wording

The following table provides certain information regarding changes in net interest income on an FTE basis (non-GAAP) attributable to changes in the average volumes and yields earned on interest-earning assets and the average volume and rates paid for interest-bearing liabilities for the three months ended September 30, 2025, compared to the three months ended September 30, 2024:

Current wording

The following table provides certain information regarding changes in net interest income on an FTE basis (non-GAAP) attributable to changes in the average volumes and yields earned on average interest-earning assets and the average volume and rates paid for average interest-bearing liabilities for the three months ended March 31, 2026, compared to the three months ended March 31, 2025:

Previous wording

Interest expense of $707.7 million decreased $17.5 million primarily due to a 19 basis point reduction in the cost of funds, partially offset by the growth in average interest-bearing deposits. Average total deposits increased $2.5 billion, or 7.3%, reflecting robust organic growth in new and existing customer relationships. The growth in average interest-bearing demand deposits of $2.3 billion and average time deposits of $593.0 million more than offset the decline in average savings deposits of $216.8 million and average non-interest-bearing demand deposits of $119.5 million as customers migrated balances into higher-yielding products. The funding mix has slightly shifted with non-interest-bearing demand deposits comprising 26% of total deposits at September 30, 2025, compared to 27% at September 30, 2024. Average short-term borrowings decreased $816.3 million, or 33.2%, primarily reflecting a decrease in FHLB borrowings as a result of our organic deposit growth. Average long-term borrowings increased $512.8 million, or 23.5%, primarily reflecting the December 2024 issuance of $500 million in senior notes, partially offset by the maturity of $350 million in senior notes in August 2025. The decrease in total cost of funds is comprised of a 34 basis point decrease in total borrowing costs and a 26 basis point decrease in interest-bearing deposit costs to 2.69%.

Current wording

Interest expense of $210.0 million decreased $25.6 million primarily due to a 31 basis point reduction in the cost of funds, partially offset by the growth in average interest-bearing deposits. Average total deposits increased $1.4 billion, or 3.8%, reflecting robust organic growth in new and existing customer relationships. The funding mix was stable with non-interest-bearing demand deposits comprising 26% of total deposits at both March 31, 2026 and March 31, 2025. Average short-term borrowings increased $604.4 million, or 44.0%, at lower yields while our average long-term borrowings decreased $843.1 million, or 29.8%, which included the maturity of $350 million in senior notes in August 2025 and $100 million in subordinated notes in October 2025, combined with a decline in average long-term FHLB borrowings. The decrease in total cost of funds is comprised of a 57 basis point decrease in total borrowing costs and a 36 basis point decrease in interest-bearing deposit costs to 2.40%.

Previous wording

The provision for credit losses on loans and leases was $67.2 million, compared to $57.5 million for the first nine months of 2024. The provision for credit losses for the first nine months of 2025 was primarily due to loan growth and net charge-off activity. The first nine months of 2025 included net charge-offs of $54.0 million, or 0.21% annualized of total average loans, compared to $42.1 million, or 0.17% annualized, in the first nine months of 2024, reflecting continued proactive management of the loan portfolio. The ACL on loans and leases was $437.3 million, an increase of $17.1 million, reflecting overall loan growth and a stable ratio of the ACL to total loans and leases at 1.25%.

Current wording

The provision for credit losses on loans and leases was $18.4 million, compared to $17.5 million for the first three months of 2025. The first three months of 2026 included net charge-offs of $15.9 million, or 0.18% annualized of total average loans, compared to $12.5 million, or 0.15% annualized, in the first three months of 2025, reflecting continued proactive management of the loan portfolio. The ACL on loans and leases was $443.0 million, an increase of $14.2 million, with the ratio of the ACL to total loans and leases increasing 1 basis point to 1.26%.

Previous wording

Total non-interest income increased $11.5 million, or 4.3%. The variances in significant individual non-interest income items are explained in the following paragraphs.

Current wording

Total non-interest income increased $3.2 million, or 3.7%. The variances in significant individual non-interest income items are explained in the following paragraphs.

Previous wording

Wealth management revenues increased $1.5 million, or 8.0%, as securities commissions and fees and trust services income increased 12.6% and 4.7%, respectively, through continued strong contributions across the geographic footprint and a $0.8 billion, or 5.5%, increase in the market value of assets under administration to $14.9 billion at September 30, 2025.

Current wording

Wealth management revenues increased $0.6 million, or 2.8%, as trust services income and securities commissions and fees increased 3.5% and 1.8%, respectively, through continued strong contributions across the geographic footprint.

Previous wording

Capital markets income increased $2.4 million, or 13.7%, driven by debt capital markets and international banking income, as well as contributions from customer swap activity, syndications, public finance and advisory services.

Current wording

Capital markets income increased $1.5 million, or 27.8%, reflecting solid contributions from debt capital markets, swap fees and international banking income.

Previous wording

Income tax expense was higher for the third quarter of 2025 primarily due to higher pre-tax income.

Current wording

Income tax expense was higher for the three months ended March 31, 2026, primarily due to higher pre-tax income.

Previous wording

The loan and lease portfolio consists principally of loans and leases to individuals and small- and medium-sized businesses within our primary markets in seven states and the District of Columbia. Our market coverage spans several major metropolitan areas including: Pittsburgh, Pennsylvania; Baltimore, Maryland; Cleveland, Ohio; Washington, D.C.; Charlotte, Raleigh, Durham and the Piedmont Triad (Winston-Salem, Greensboro and High Point) in North Carolina; and Charleston, South Carolina.

Current wording

The loan and lease portfolio consists principally of loans and leases to individuals and small- and medium-sized businesses within our primary markets in seven states and the District of Columbia. Our market coverage spans several major metropolitan areas including: Pittsburgh, Pennsylvania; Baltimore, Maryland; Cleveland, Ohio; Washington, D.C.; Charlotte, Raleigh, Durham and the Piedmont Triad (Winston-Salem, Greensboro and High Point) in North Carolina; and Charleston, South Carolina. In December 2025, we transferred approximately $200 million of performing residential mortgage loans to held-for-sale in anticipation of a loan sale that closed in February 2026 as part of balance sheet management actions.

Previous wording

Our commercial real estate portfolio included $8.8 billion of non-owner-occupied loans of which 17.9% represented office loans. Our top 25 non-owner-occupied commercial real estate loans averaged approximately $23 million per exposure with the office component primarily made up of mid-sized offices located outside of central business districts with 42% of the office portfolio averaging less than $5 million per exposure. For consumer lending, residential mortgages increased $0.9 billion, compared to December 31, 2024, largely due to the continued successful execution in key markets and long-standing strategy of serving the purchase market.

Current wording

Our commercial real estate portfolio included $8.3 billion of non-owner-occupied loans of which 17.4% represented office loans. Our top 25 non-owner-occupied commercial real estate loans averaged approximately $22 million per exposure with the office component primarily made up of mid-sized offices located outside of central business districts with an average office loan size of $1.6 million. Additionally, we have a continued focus on core commercial and industrial lending activity with traditional middle market customers. Our minimal non-depository financial institution (NDFI) balances at 1.4% of total loans is well below peer and industry median levels with the large majority of FNB’s NDFI portfolio in the FNBPA Call Report’s “Other Loans” category which supports firm’s working capital and acquisition growth strategies, not lending activities. For consumer lending, residential mortgages increased $156.0 million, compared to December 31, 2025, largely due to the continued successful execution in key markets and long-standing strategy of serving the purchase market.

Previous wording

At September 30, 2025 and December 31, 2024, we utilized a third-party consensus macroeconomic forecast reflecting the current and projected macroeconomic environment. For our ACL calculation at September 30, 2025, the macroeconomic variables that we utilized included, but were not limited to: (i) the purchase only Housing Price Index, which increases 3.4% over our R&S forecast period, (ii) a CRE Price Index, which decreases 4.0% over our R&S forecast period, (iii) S&P Volatility, which increases 91.1% in 2025 and decreases 19.8% in 2026 and (iv) personal and business bankruptcies, which increase steadily over the R&S forecast period but average below the historical through-the-cycle period. While we have not changed our ACL modeling methodology, we continually assess our key macroeconomic variables and their correlation to our historical and expected portfolio performance. During the quarter ended September 30, 2025, we changed certain macroeconomic variables used for ACL modeling purposes as we believe the new variables better correlate to our historical performance over the economic cycles. Macroeconomic variables that we utilized for our ACL calculation as of December 31, 2024 included, but were not limited to: (i) the purchase only Housing Price Index, which increases 7.4% over our R&S forecast period, (ii) a Commercial Real Estate Price Index, which increases 3.9% over our R&S forecast period, (iii) S&P Volatility, which increases 34.9% in 2025 and 2.5% in 2026 and (iv) personal and business bankruptcies, which increase steadily over the R&S forecast period but average below the historical through-the-cycle period.

Current wording

At March 31, 2026 and December 31, 2025, we utilized a third-party consensus macroeconomic forecast reflecting the current and projected macroeconomic environment. For our ACL calculation at March 31, 2026, the macroeconomic variables that we utilized included, but were not limited to: (i) the purchase only Housing Price Index, which increases 4.0% over our R&S forecast period, (ii) a CRE Price Index, which increases 1.3% over our R&S forecast period, (iii) S&P Volatility, which increases 17.5% in 2026 and decreases 4.6% in 2027 and (iv) personal and business bankruptcies, which increase and decrease, respectively, over the R&S forecast period but average below the historical through-the-cycle period. Macroeconomic variables that we utilized for our ACL calculation as of December 31, 2025 included, but were not limited to: (i) the purchase only Housing Price Index, which increases 4.3% over our R&S forecast period, (ii) a Commercial Real Estate Price Index, which decreases 0.5% over our R&S forecast period, (iii) S&P Volatility, which decreases 2.2% in 2026 and 7.9% in 2027 and (iv) personal and business bankruptcies, which increase steadily over the R&S forecast period but average below the historical through-the-cycle period.

Previous wording

The ACL on loans and leases of $437.3 million at September 30, 2025 increased $14.5 million, or 3.4%, from December 31, 2024. Our ending ACL coverage ratio was stable at 1.25% at both September 30, 2025 and December 31, 2024. The ACL as a percentage of non-performing loans for the total portfolio increased to 350% as of September 30, 2025, compared to 265% as of December 31, 2024.

Current wording

The ACL on loans and leases of $443.0 million at March 31, 2026 increased $3.5 million, or 0.8%, from December 31, 2025 with our ending ACL coverage ratio stable at 1.26%. The ACL as a percentage of non-performing loans for the total portfolio decreased to 377% as of March 31, 2026, compared to 418% as of December 31, 2025, with coverage levels remaining at historically high levels.

Previous wording

Total provision for credit losses for the nine months ended September 30, 2025 was $67.1 million, compared to $57.5 million for the same period in 2024. Net charge-offs were $54.0 million for the nine months ended September 30, 2025, compared to $42.1 million for the first nine months of 2024.

Current wording

Total provision for credit losses for the three months ended March 31, 2026 was $18.5 million, compared to $17.5 million for the same period in 2025. Net charge-offs were $15.9 million for the three months ended March 31, 2026, compared to $12.5 million for the first three months of 2025.

Previous wording

Total deposits increased $1.3 billion, or 3.6%, from December 31, 2024, due to growth in new and existing customer relationships. We ended the quarter with approximately 77% of all deposits insured by the FDIC or collateralized.

Current wording

Total deposits increased $141.8 million, or 0.4%, from December 31, 2025, due to growth in new and existing customer relationships. We ended the quarter with approximately 76% of all deposits insured by the FDIC or collateralized.

Previous wording

Pursuant to and in compliance with applicable SEC laws, rules and regulations, we may, from time to time, issue and sell in one or more offerings any combination of common stock, preferred stock, debt securities, depositary shares, warrants, stock purchase contracts or units. On December 11, 2024, we completed a registered debt offering in which we issued $500 million aggregate principal amount of 5.722% fixed rate / floating rate senior notes due in 2030. The net proceeds of the debt offering after deducting underwriting discounts and commissions and offering costs were $496.7 million. These proceeds were used for general corporate purposes, which included investments at the holding company level, capital to support the growth of FNBPA and refinancing of outstanding indebtedness. On August 25, 2025, $350 million in senior debt that was issued in August 2022 matured.

Current wording

Pursuant to and in compliance with applicable SEC laws, rules and regulations, we may, from time to time, issue and sell in one or more offerings any combination of common stock, preferred stock, debt securities, depositary shares, warrants, stock purchase contracts or units.

Previous wording

Since inception of our $300 million stock purchase program, we repurchased 16.6 million shares at a weighted average share price of $11.81 for $196.3 million, with $103.7 million remaining for repurchase under this program. During the third quarter of 2025, we repurchased 0.8 million shares at a weighted average share price of $15.50 for $12.0 million. Any repurchases will be made from time to time on the open market at prevailing market prices or in privately negotiated transactions. The purchases will be funded from available working capital. There is no guarantee as to the exact number of shares that will be repurchased and we may discontinue purchases at any time. The Inflation Reduction Act of 2022 requires a 1% excise tax on stock repurchases.

Current wording

During the first quarter of 2026, we repurchased $35.3 million, or 2.0 million shares, of common stock at a weighted average share price of $17.41. In April 2026, we announced that our Board of Directors authorized a new share repurchase program. Including the authority remaining under the previous program, total repurchase capacity is $300 million. The repurchases will be made from time to time on the open market at prevailing market prices or in privately negotiated transactions. The purchases will be funded from available working capital. There is no guarantee as to the exact number of shares that will be repurchased and we may discontinue purchases at any time.

Previous wording

Capital management is a continuous process, with capital plans and stress testing for FNB and FNBPA updated at least annually. These capital plans include assessing the adequacy of expected capital levels assuming various scenarios by projecting capital needs for a forecast period of 2-3 years beyond the current year. From time to time, we issue shares initially acquired by us as treasury stock under our various benefit plans. We may issue additional preferred or common stock to maintain our well-capitalized status.

Current wording

Capital management is a continuous process, with capital plans and stress testing for FNB and FNBPA updated at least annually. These capital plans include assessing the adequacy of expected capital levels assuming various scenarios by projecting capital needs for a forecast period of two to three years beyond the current year. From time to time, we issue shares initially acquired by us as treasury stock under our various benefit plans. We may issue additional preferred or common stock to maintain our well-capitalized status.

Previous wording

Over time, our liquidity position has been positively impacted by FNBPA's ability to generate growth in relationship-based deposit accounts. Organic growth in low-cost transaction deposits has been complemented by management’s continued strategy of deposit gathering efforts focused on attracting new customer relationships across our geographic footprint and deepening relationships with existing customers, in part through internal lead generation efforts leveraging our data analytics capabilities. These strategies resulted in total deposit growth of $1.3 billion, or 3.6%, compared to December 31, 2024, with interest-bearing demand deposits, non-interest-bearing demand deposits and time deposits increasing $1.1 billion, $207.6 million and $55.3 million, respectively. Savings account balances declined $63.2 million compared to December 31, 2024. The mix of non-interest-bearing demand deposits to total deposits remained stable with the prior quarter at 26%. Our loan to deposit ratio stood at 91% at both September 30, 2025 and December 31, 2024.

Current wording

Over time, our liquidity position has been positively impacted by FNBPA's ability to generate growth in relationship-based deposit accounts. Organic growth in low-cost transaction deposits has been complemented by management’s continued strategy of deposit gathering efforts focused on attracting new customer relationships across our geographic footprint and deepening relationships with existing customers, in part through internal lead generation efforts leveraging our data analytics capabilities. These successful strategies resulted in total deposit growth of $141.8 million, or 0.4%, compared to December 31, 2025, with interest-bearing deposits and non-interest-bearing demand deposits increasing $52.9 million and $88.9 million, respectively. The mix of non-interest-bearing demand deposits to total deposits remained stable with both the prior quarter and year-ago quarter at 26%. Our loan to deposit ratio stood at 90.3% at March 31, 2026, compared to 89.7% at December 31, 2025.

Previous wording

At September 30, 2025, approximately 77% of our deposits were insured by the FDIC or collateralized, consistent with December 31, 2024 levels. Our cash balances held at the FRB were $2.0 billion at both September 30, 2025 and December 31, 2024. Management will continue to evaluate appropriate levels of liquidity based on expected loan and deposit growth, other balance sheet activity and the current market environment.

Current wording

At March 31, 2026, approximately 76% of our deposits were insured by the FDIC or collateralized, consistent with December 31, 2025 levels. Our cash balances held at the FRB were $2.2 billion at March 31, 2026 and $2.1 billion at December 31, 2025. Management will continue to evaluate appropriate levels of liquidity based on expected loan and deposit growth, other balance sheet activity and the current market environment.

Previous wording

Our bank-level liquidity position remains strong. Our contingency funding policy and periodic liquidity stress testing of multiple stress scenarios is particularly valuable as we successfully manage our liquidity. A portion of our available borrowing capacity includes capacity at the FRB's Discount Window. We have no borrowings under this facility. Additional sources of unused wholesale credit availability for FNBPA include the ability to borrow from the FHLB, correspondent bank lines, and access to other funding channels. In addition to credit availability, FNBPA also has excess cash and salable unpledged government and agency securities that could be utilized to meet funding needs. At September 30, 2025, FNBPA has $3.1 billion of cash and salable unpledged government and agency securities representing 6.3% of total assets, an improvement from $2.9 billion and 6.0% at December 31, 2024. This compares to a policy minimum of 3.0%. The Uninsured Deposit Coverage Ratio is designed to determine the amount of funding sources available to cover uninsured deposit outflows. This ratio has improved from December 31, 2024 due to various actions undertaken by management, including expanding borrowing capacity at the FHLB and FRB.

Current wording

Our bank-level liquidity position remains strong. Our contingency funding policy and periodic liquidity stress testing of multiple stress scenarios is particularly valuable as we actively manage our liquidity. A portion of our available borrowing capacity includes capacity at the FRB's Discount Window. Through various actions, management increased availability from this source to $3.4 billion. We have no borrowings under this facility. Additional sources of unused wholesale credit availability for FNBPA include the ability to borrow from the FHLB, correspondent bank lines, and access to other funding channels. In addition to credit availability, FNBPA also has excess cash and salable unpledged government and agency securities that could be utilized to meet funding needs. At March 31, 2026, FNBPA has $3.5 billion of cash and salable unpledged government and agency securities representing 7.0% of total assets, compared to $3.3 million and 6.5% at December 31, 2025. This compares to a policy minimum of 3.0%. The Uninsured Deposit Coverage Ratio is designed to determine the amount of funding sources available to cover uninsured deposit outflows. This ratio has improved from December 31, 2025 due to various actions undertaken by management, including expanding borrowing capacity at the FHLB and FRB.

Previous wording

The twelve-month cumulative gap to total assets ratio was (3.1)% as of September 30, 2025, compared to (5.0)% as of December 31, 2024. The improvement in the twelve-month cumulative gap to total assets was primarily related to management's shorter-term time deposit offerings, which reduced our asset sensitivity. In addition, the ALCO regularly monitors various liquidity ratios, stress scenarios of our liquidity position and assumptions considering market disruptions, lending demand, deposit behavior, and funding availability. The stress scenarios forecast that adequate funding will be available even under severe conditions. Management believes we have sufficient liquidity available to meet our normal operating and contingency funding cash needs for the next twelve months and thereafter for the foreseeable future.

Current wording

The twelve-month cumulative gap to total assets ratio was (3.0)% as of March 31, 2026, compared to (2.2)% as of December 31, 2025. The change in the twelve-month cumulative gap to total assets was primarily related to lower prepayment estimates, decreased investment securities maturities and decreased loans held for sale. ALCO regularly monitors various liquidity ratios, stress scenarios of our liquidity position and assumptions considering market disruptions, lending demand, deposit behavior, and funding availability. The stress scenarios forecast that adequate funding will be available even under severe conditions. Management believes we have sufficient liquidity available to meet our normal operating and contingency funding cash needs for the next twelve months and thereafter for the foreseeable future.

Previous wording

Management utilizes the repricing gap analysis as a diagnostic tool in managing net interest income and EVE risk measures. Repricing gap analysis, while useful, has some limitations in measuring interest rate risk. The positive cumulative gap positions indicate that we have a greater amount of repricing earning assets than repricing interest-bearing liabilities over the subsequent twelve months, thereby creating our current asset sensitive position. As a result of management's strategies to reduce its asset sensitive position, the twelve-month cumulative repricing gap to total assets was 2.3% as of September 30, 2025, down from 4.5% at December 31, 2024. Specific pricing actions included an emphasis on originating shorter-term time deposits so more interest-bearing liabilities will mature in less than 12 months, hence reducing the repricing gap differential.

Current wording

Management utilizes the repricing gap analysis as a diagnostic tool in managing net interest income and EVE risk measures. Repricing gap analysis, while useful, has some limitations in measuring interest rate risk. The positive cumulative gap positions indicate that we have a greater amount of repricing earning assets than repricing interest-bearing liabilities over the subsequent twelve months, resulting in our slightly asset sensitive position. As a result of management's strategies to reduce its asset sensitive position, the twelve-month cumulative repricing gap to total assets was 3.0% as of March 31, 2026, down from 3.2% at December 31, 2025. Specific pricing actions included an emphasis on originating shorter-term time deposits and borrowings so more interest-bearing liabilities will mature in less than 12 months, hence reducing the repricing gap differential.

Previous wording

There are multiple factors that influence our interest rate risk position and impact net interest income, including external factors such as the shape of the yield curve, the competitive landscape and expectations regarding future interest rates, as well as internal factors regarding product offerings, product mix and pricing and re-pricing of loans and deposits. Our current interest rate risk position is slightly asset sensitive. A key driver of this position resulted from the origination of consumer and commercial loans with short-term repricing characteristics, some of which have been swapped to a fixed rate. Total variable and adjustable-rate loans were 62.9% of total net loans and leases at both September 30, 2025 and December 31, 2024. Forty-six percent of our net loans and leases reprice within the next three months and are indexed to short-term SOFR, Prime and other indices. Furthermore, we regularly sell long-term fixed-rate residential mortgages in the secondary market.

Current wording

There are multiple factors that influence our interest rate risk position and impact on net interest income, including external factors such as the shape of the yield curve, the competitive landscape and expectations regarding future interest rates, as well as internal factors regarding product offerings, product mix and pricing and re-pricing of loans and deposits. Our current interest rate risk position is slightly asset sensitive. A key driver of this position resulted from the origination of consumer and commercial loans with short-term repricing characteristics, some of which have been swapped to a fixed rate. Total variable and adjustable-rate loans were 63.1% and 63.4% of total net loans and leases at March 31, 2026 and December 31, 2025, respectively. Forty-six percent of our net loans and leases reprice within the next three months and are indexed to short-term SOFR, Prime and other indices. Furthermore, we regularly sell long-term fixed-rate residential mortgages in the secondary market.

Previous wording

Management continues to be proactive in managing our interest rate risk (IRR) position with the intention to manage to a more neutral position given the current market expectations for lower short-term interest rates. During the first nine months of 2025, management adjusted the IRR position by purchasing investment securities with an average duration of 4.1 years, originating adjustable-rate mortgage loans with longer-duration fixed-rate reset periods, strategically meeting our customers' preferences for deposit products with shorter-term time deposits and maintaining borrowings with variable rates and varying maturities. As a result, the net interest income change over 12 months shown above in both the up and down rate ramp scenarios is, as intended, closer to neutral when compared to December 31, 2024.

Current wording

Management continues to be proactive in managing our interest rate risk (IRR) position with the intention to maintain exposures near the current neutral levels. During the first three months of 2026, management adjusted the IRR position by purchasing investment securities with an average duration of 4.5 years, originating adjustable-rate mortgage loans with longer-duration fixed-rate reset periods, strategically meeting our customers' preferences for deposit products with shorter-term time deposits and maintaining borrowings with variable rates and varying maturities. As a result, the net interest income percentage change over 12 months shown above in both the up and down rate ramp scenarios is, as intended, closer to neutral when compared to December 31, 2025.

Previous wording

We also utilize derivatives to manage the IRR position. These positions are used to protect the fair value of assets and liabilities by converting the contractual interest rate on a specified amount (i.e., notional amounts) to another interest rate index or to hedge the variability in cash flows attributable to the contractually specified interest rate by converting the variable rate index into a fixed rate. The volume, maturity and mix of derivative positions change periodically as we adjust our broader interest rate risk management objectives, and the balance sheet positions to be hedged. During the fourth quarter of 2024, we executed $1.0 billion notional balance receive-fixed interest rate swaps designated as cash flow hedges for variable rate commercial loans at an average rate of 3.9% and average maturity of 42.3 months. During the second quarter of 2025, we executed $250 million (notional) at a rate of 3.7% and a maturity of 20 months. At September 30, 2025, we have a total of $1.70 billion (notional) of these cash flow hedges at an average rate of 3.4% and average maturity of 23.4 months with $250 million (notional) of this total maturing on October 1, 2025 at a rate of 0.69%. Additionally, we have a $200.0 million (notional) interest rate collar on variable rate commercial loans with strike rates between 2.8525% and 5.50% that matures in April 2026. These actions lowered our asset sensitivity.

Current wording

We also utilize derivatives to manage the IRR position. These positions are used to protect the fair value of assets and liabilities by converting the contractual interest rate on a specified amount (i.e., notional amounts) to another interest rate index or to hedge the variability in cash flows attributable to the contractually specified interest rate by converting the variable rate index into a fixed rate. The volume, maturity and mix of derivative positions change periodically as we adjust our broader interest rate risk management objectives, and the balance sheet positions to be hedged.