퍼스트 커먼웰스 파이낸셜(FCF) 2026년 3분기 실적 발표회: NIM 4.10% 달성

핵심 요약

• 조정 주당순이익(Core EPS)은 0.45달러를 기록했습니다. 실적에는 연방 에너지 세액공제로 인한 470만 달러의 일회성 이익이 포함되었으며, 이는 세전 기준 600만 달러에 해당합니다.
• 충당금 전입액은 미인출 대출 약정 관련 350만 달러와 대손충당금 1,070만 달러를 포함해 총 1,420만 달러에 달했습니다. 개별 충당금 중 약 770만 달러는 이전에 식별된 3건의 여신과 연관되어 있습니다.
• 순이자마진(NIM)은 전분기 대비 10bp 확대된 4.10%를 기록한 반면, 예금 비용은 7bp 하락한 1.67%를 기록했습니다.
• 대출은 연환산 2.6%의 증가율을 기록했습니다. 가계 및 기업 대출 신규 취급액은 전년 동기 대비 증가한 반면, 대출 상환 속도는 5분기 만에 처음으로 둔화되었습니다.
• 퍼스트 커먼웰스 파이낸셜은 평균 단가 21.18달러에 약 8,800만 달러 규모의 자사주를 매입했습니다. 이사회는 이후 2,500만 달러 규모의 자사주 추가 매입을 승인했습니다.
• 경영진은 추가적인 금리 변동이나 수익률 곡선의 변화가 없다고 가정할 때, NIM이 2026년 4분기에 4.20%에 근접하고 2027년에는 4.20%대 중반으로 상승할 것으로 전망하고 있습니다.

핵심 재무 데이터

사업 및 영업 실적

순이자이익은 우호적인 자산·부채 구성, 예금 비용 감소, 대출 수익률 상승의 수혜를 입었습니다. 경영진은 최근의 금리 인상이 3분기 실적에 큰 기여를 하기에는 너무 늦게 이루어진 반면, 무수익여신에 대한 이자 환입 취소로 인해 분기 NIM이 약 4bp 감소했다고 밝혔습니다.

수수료 이익은 2분기와 동일한 수준을 유지했습니다. 자산관리, 주택담보대출, 백투백(back-to-back) 금리스왑 부문의 성장은 전분기에 반영되었던 130만 달러의 일회성 이익 기저효과로 인해 상쇄되었습니다.

비이자비용은 장기 임대차 연장에 따른 60만 달러의 상각과 2분기에 수령했던 50만 달러의 벤더 비용 환급 부재 등으로 인해 상승했습니다. 대출 취급 실적과 연계된 성과급 충당금 증가 및 미국 연방예금보험공사(FDIC) 분담금 비용 증가도 영향을 미쳤습니다.

가계 및 기업 부문 전반에서 대출 신규 취급이 개선되었습니다. 경영진은 기업 및 공업(C&I) 대출을 전략적 우선순위로 꼽았으나, 단일 부문에 의존하기보다는 주택담보신용대출(HELOC), 주택담보대출, 간접 자동차 대출, 상업용 부동산, C&I 및 장비 금융 전반에 걸친 광범위한 성장을 추진하고 있다고 밝혔습니다.

투자용 부동산 건설 대출 잔액은 이번 분기 동안 1억 달러 이상 증가했습니다. 경영진은 해당 약정 금액이 평균 12개월에서 18개월에 걸쳐 집행될 것으로 예상하고 있습니다. HELOC 신규 취급 역시 미인출 약정 관련 충당금 350만 달러 발생에 기여했습니다.

회사의 2027년 투자 계획에는 기술, 인재, 마케팅, 사기 방지, 뱅커 생산성, 리드 발굴, 재무 분석 등이 포함되어 있습니다. 퍼스트 커먼웰스 파이낸셜은 35개 핀테크 파트너사와 협업하고 있으며, 데이터 기반 고객 인사이트, 콜센터 효율화, 정보 보안 및 결제 역량에 지속적으로 투자하고 있다고 밝혔습니다.

경영진 가이던스

• 순이자마진(NIM): 경영진은 2026년 4분기 NIM이 약 4.20%, 2027년에는 4.20%대 중반에 이를 것으로 예상하고 있으며, 오차 범위는 약 5bp 수준입니다. 이 전망은 추가적인 금리 변동이 없고 수익률 곡선의 형태가 유지된다고 가정한 것입니다.
• 대출 성장률: 회사는 한 자릿수 중반의 성장 목표를 유지했습니다. 경영진은 4분기 성장세가 3분기 수준을 유지하거나 소폭 상회할 것으로 전망하면서도, 금리 상승이 수요를 둔화시킬 수 있음을 인정했습니다.
• 수수료 이익: 2026년 4분기 비이자이익 가이던스는 2,400만 달러에서 2,500만 달러로 유지됩니다.
• 비용: 2026년 4분기 비이자비용 가이던스는 7,400만 달러에서 7,600만 달러로 유지됩니다.
• 예금 베타: 경영진은 정기예금을 제외한 이자부 수시입출금식 예금의 추정 예금 베타를 25%로 적용하고 있습니다.
• 에너지 세액공제: 경영진은 정기적인 매입을 통해 실효세율을 약 1~2%포인트 낮추고 연간 주당 약 0.02달러의 이익을 더할 수 있다고 밝혔습니다. 다만 이 혜택은 거래 조건에 크게 좌우되며, 단기적 인식 시점은 불균등할 수 있습니다.
• 자본 환원: 이사회는 2,500만 달러 규모의 자사주 추가 매입 프로그램을 승인했으며, 경영진은 블랙아웃 기간이 끝난 후 자사주 매입을 재개할 것이라고 밝혔습니다.

리스크 및 주시 영역

3분기 주요 부담 요인은 대손비용이었습니다. 부실채권(NPL)이 증가했으나, 경영진은 이러한 변화가 광범위한 포트폴리오 악화가 아닌 이전에 식별된 소수의 거래처에 집중된 것이라고 설명했습니다.

2건의 대형 여신이 부실 상태로 전환됨에 따라 고정이하 분류 여신이 2,600만 달러 증가했습니다. 동시에 기타 요주의 자산(OAEM) 대출은 2,500만 달러 감소했으며, 관찰 대상(watch-list) 대출은 연초 대비 1억 달러 이상 감소했습니다.

약 3억 달러 규모의 펜실베이니아 중부 포트폴리오 중 약 6,000만 달러의 주의 요망 여신이 남아 있습니다. 경영진은 가장 큰 거래처를 제외하면 이 익스포저가 분산되어 있다고 밝혔으나, 해당 포트폴리오가 여전히 신용 부문의 부담 요인으로 남아 있음을 인정했습니다.

높은 금리는 특히 상업용 부동산 분야에서 대출 수요를 위축시킬 수 있습니다. 경영진은 금리가 50~100bp 추가 상승할 경우 일부 프로젝트의 자금 조달이 불가능해지고 만기 대출의 리파이낸싱이 복잡해질 수 있다고 지적했습니다.

예금 유치 경쟁 또한 심화되고 있습니다. 회사는 예대율을 90%대 초반 수준으로 유지하면서 한 자릿수 중반의 대출 성장에 상응하는 예금 성장을 통해 자금을 조달하는 것을 목표로 하고 있으며, 이를 위해 시중 금리 수준의 예금 이자를 지급해야 할 수 있습니다.

애널리스트 Q&A 주요 내용

여신 정상화: 경영진은 향후 몇 분기에 걸쳐 주요 손상여신 문제를 해결해 나갈 것으로 예상하고 있습니다. 신규 부실 익스포저 중 가장 큰 건은 1,600만 달러 규모의 C&I 대출이었습니다. 피츠버그의 500만 달러 규모 주상복합 여신도 무수익 상태로 전환되었으며, 기존 1,100만 달러 규모의 피츠버그 주상복합 다가구 주택 대출은 추가 충당금 적립이 필요했습니다.

충당금 전망: 경영진은 구체적인 분기별 가이던스를 제시하지 않았습니다. 마이크 프라이스(Mike Price) CEO는 충당금 전입액이 1,000만 달러 미만으로 낮아지기를 기대한다고 말했으나, 개별 여신 해결의 시기와 결과에 대한 불확실성을 강조했습니다.

예금 유지율: 퍼스트 커먼웰스 파이낸셜은 만기 도래 CD의 약 80%를 유지하고 있습니다. 유지된 잔액의 절반가량은 현재 프로모션 금리로 전환되는 반면, 나머지는 은행의 고객 유지 금리로 갱신됩니다. 경영진은 CD로 갱신되지 않은 잔액의 상당수도 머니마켓이나 기타 계좌 형태로 은행에 남아 있다고 밝혔습니다.

마진 지속 가능성: 경영진은 마진 개선의 원인을 전략적 실행과 자산부채 종합관리(ALM) 포지셔닝 모두의 결과로 돌렸습니다. 은행은 이전 대출 매각으로 확보한 유동성을 활용해 조달 구조를 조정하고 CD 금리를 낮췄으며, 무이자 예금 확보에 집중했습니다.

대출 수요: 경영진은 고금리가 특히 상업용 부동산에 대한 수요를 감소시킬 것으로 예상합니다. 그러나 대출 성장이 회사의 한 자릿수 중반 목표치에 미치지 못하더라도, 고정금리 대출의 재산정(repricing)을 통해 포트폴리오 수익률을 지속적으로 뒷받침할 수 있습니다.

실적 발표 컨퍼런스 콜 전문

전체 실적 발표 컨퍼런스 콜 녹취록

경영진 발표

Operator

[Audio Gap]

[Operator Instructions]

I will now hand the conference over to Ryan Thomas, Vice President of Finance and Investor Relations. Please go ahead.

Ryan Thomas

Thank you, Jonathan, and good afternoon, everyone. Thanks for joining us today to discuss First Commonwealth Financial Corporation's third quarter financial results. Participating on today's call will be Mike Price, President and CEO; Jim Reske, Chief Financial Officer; Brian Sohocki, Chief Credit Officer; and Mike McCuen, Chief Lending Officer.

As a reminder, a copy of yesterday's earnings release can be accessed by logging on to fcbanking.com and selecting the Investor Relations link at the top of the page. We have also included a slide presentation on our Investor Relations website with supplemental information that will be referenced during today's call. ..

Before we begin, I need to caution listeners that today's call will contain forward-looking statements. Please refer to our forward-looking statements disclaimer on Page 3 of the slide presentation for a description of risks and uncertainties and that could cause actual results to differ materially from those reflected in the forward-looking statements. Today's call will also include non-GAAP financial measures. Non-GAAP financial measures should be viewed in addition to and not as an alternative for our reported results prepared in accordance with GAAP. A reconciliation of these measures can be found in the appendix of today's slide presentation.

With that, I will turn the call over to Mike.

Thomas Michael Price

Thank you, Ryan. Good afternoon, everyone. Core earnings per share totaled $0.45 for the third quarter. There were 2 unrelated offsetting financial events this quarter. These results included $4.7 million of onetime energy tax credits equivalent to $6 million on a pretax basis. These tax credits helped offset provision expense that came in at $14.2 million. The provision figure includes $3.5 million associated with the unfunded loan commitments reflective of strong production this quarter in committed lines.

The other $10.7 million represents provision for loan losses, driven principally by approximately $7.7 million of specific reserves associated with 3 previously identified credits. Nonperforming loans increased, but the increase was also concentrated in a limited number of previously identified relationships rather than broad-based portfolio deterioration. Beyond those 2 events, the operating trends of our core businesses are strong.

The net interest margin increased to 4.1%, supported by a decline in deposit costs to 1.67% and the impact of the Fed's latest hike on our variable rate loan portfolio. Additionally, consumer and commercial loan origination throughout the third quarter increased year-over-year. Loan payoffs also slowed for the first time in 5 quarters, leading to annualized loan growth of 2.6% in the quarter. Together with current backlogs, these trends support the outlook for loan growth within our mid-single-digit guidance. A 3 principal areas of focus for the near term include better credit performance, generating profitable growth and controlling expenses to create positive operating leverage.

The latter becomes vital to investment in the future of our company. Our 2027 investment plan includes opportunities in technology, talent, marketing, fraud prevention and improved banker productivity, lead generation and financial analysis. Lastly, we believe a mission-driven community bank of our size remains important and relevant to our customers, communities, employees and investors.

And with that, I'll turn it over to Jim.

James Reske

Thanks, Mike. Mike provided the broad brush strokes of our financial performance this quarter, including credit. So I'll spend my time drilling down into our results to help you get a better understanding of the long-term run rate of our financial performance. The credit story is important, but I don't want to overshadow positive trends in our net interest margin, spread income, balance sheet growth and our fee income trajectory.

Before I walk you through those things, however, I want to spend a moment addressing the impact of the tax credits and the buyback on the quarter. First, the tax credits. We have, for many years, purchased credits against our income tax but this was our first foray into federal energy tax credits. We started looking at these tax credits in the second quarter this year, and we purchased just over 50 million in credits in the third quarter. Those credits will be applied towards our federal tax liability for tax years '25 and 2022.

That resulted in the recognition of $4.7 million in tax benefits in the third quarter. We intend to purchase credits going forward, including for tax year 2026. And with that purchase, we will purchase additional credits that we can carry back to 2023 and 2024. Once that's done and assuming the laws affecting the transferability of federal renewable energy tax credits don't change, will let it settle into a rhythm of purchasing tax credits like this every year. We think this could bring our effective tax rate down by approximately 1 to 2 percentage points, which might be worth about $0.02 per share per year, but it's heavily dependent on the terms of each deal.

The other major event of the quarter we're talking about was the full execution of the previously announced $75 million buyback program. We came into the quarter with about $13 million of share repurchase authority from our previous program. Combined with the new authorization, repurchased approximately $88 million of stock during the quarter at an average price of $21.18. That helped rightsize the tangible common ratio from 9.9% last quarter to 9.2% this quarter.

That, in turn, contributed to the expansion of our core return on average common equity to 15.90%, up 24 basis points from last quarter despite the elevated provision expense this quarter. We are also pleased to announce that our Board has authorized an additional $25 million in repurchase authority. We intend to recommence share repurchases next week once we come out of blackout. Beyond the tax credits and the buyback, however, there are positive fundamental trends in our revenue that are worth talking about.

Our net interest margin or NIM expanded by 10 basis points from 4.01% last quarter to 4.1% this quarter. We were able to decrease deposit costs by 7 basis points last quarter. The September rate hike came too late to have much benefit on loan yields in the third quarter. But loan yields in the third quarter were held back by the reversal of accrued interest on nonaccrual loans, which created a drag of approximately 4 basis points of NIM in the third quarter.

Looking forward, with no further changes in rates, which means no hikes and no changes in the shape of the yield curve, we would expect our NIM to rise to around 4.20% in the fourth quarter and continue to rise into the mid-420sin 2027. We all those estimates are give or take 5 basis points as perusal. I'd also point out that if not only NIM that is a good story for us, but our net interest income increased as well by $3.9 million last quarter, an annualized rate of approximately 13.7%.

Fee income was unchanged from last quarter, but that's only because real progress in core fee items such as wealth, mortgage and back-to-back interest rate swaps was offset by the loss of $1.3 million a second quarter onetime gains we didn't have this quarter. Our previous guidance for fee income to range from $24 million to $25 million per quarter remains unchanged for the fourth quarter. Expenses were up to quarter but were impacted by several discrete items. We incurred a $0.6 million write-down on the extension of a long-term lease, but it will save us money in the long run.

In addition, we received a $0.5 million reimbursement from the vendor last quarter that we obviously didn't have this quarter. Those 2 items together accounted for about $1.1 million of the quarter-over-quarter swing in expenses. The other major increased expense items included incentive accruals primarily related to increased loan production and our FDIC assessment costs.

Looking ahead, our previous guidance of $74 million to $76 million per quarter remains unchanged for the fourth quarter. We will provide updated noninterest income and expense guidance for 2027 in January as we have done in the past.

With that, we'll take any questions you may have.

Operator

[Operator Instructions] Your first question is from the line of Kelly Motta from KBW.

질의응답

Unknown Analyst

This is Megan Mens on for Kelly Motta. So your deposit costs trended lower, very good trend. And so I was just sort of wondering how sustainable you guys thought this was in a higher rate environment and with any competition? And last rising rate cycle, your deposit beta was just under 40%. So any thoughts on what you thought that was going to be in the next set of hikes?

Thomas Michael Price

Jim, you start.

James Reske

Yes. I'll just offer a couple of thoughts on that. One is we do see deposit competition heating up and our long-term goal is to grow our deposit base commensurate with our loan growth. So we look for mid-single-digit loan growth, we would like to fund that consistently with deposit growth to keep our loan-to-deposit ratio where it is now in the low 90s. And that means we have to pay market rates for those deposits with the competition heating up in a rising rate environment, we expect our beta to be consistent with the way we calculated our historical beta of 25% with CapEx that are nonmaturity deposits, interest-bearing deposits, not including time deposits.

We do a lot of -- we actually pay outside vendors to look at our deposit base to kind of accurately assess where our deposit betas have been in the past, so we can have a good estimate for the future, but that's the estimate we're using about a 25% deposit beta. So hope that please answer some of your questions on Mike, you want to add?

Thomas Michael Price

It's a bimonthly exercise. Every other week, we are getting together as a team and trying to understand the texture of exactly what you're talking about. And where we might attract some money and also how we might manage that for margin. It's a fun conundrum.

Unknown Analyst

Okay. That was helpful. And then I also -- like you had very strong noninterest-bearing deposit growth and time deposits came down. So can you sort of provide more detail on the drivers of that as well as upcoming maturities in CDs in the next quarter and the rate they're maturing versus the new offering rate?

James Reske

Yes. A couple of thoughts. We do the last 18 months or so, we had CDs at shorter-term maturities, but every bank was doing that. So nothing really new there. We're kind of keeping a term short and that was working. Earlier this year, we started going a little bit longer. We had some doubts whether a 15-month CD would attract customers and balances because customers simply don't like to go beyond 12 months, but it worked very well for us. And that was probably because we had a very strong customer perception of a falling rate environment.

So if you saw a good rate at a longer term, it will be on 12 months, we are able to gather funds in those accounts. Now there's a shift in the customer sentiment towards a rising rate environment, so it's harder to get customers to do that. But the way the structure we have -- a number of CD maturities coming up soon. I wouldn't call it a cliff or anything that's unmanageable. But because those rates were short now, a lot of those seeds are maturing, and we're dealing with that as they come.

Our CD retention rate has been fairly consistent over time. We're -- I don't think it's that different industry averages. We're able to retain about 80% of the CDs that mature. The 20% that don't generally tend to stay with the bank, they go into money market accounts or something else on as those rates are close. The 80% of do stay, about half of those will want the current special rate, whatever that is, and the other half will roll to the retention rate we're offering them. That whole process works, and that's a lot of the way we manage the rate cost -- the deposit cost of the bank, that's worked well.

Thomas Michael Price

Yes. I'd just add that the texture of our depository on the noninterest-bearing side is about 2/3 commercial. And so a lot of that might be more seasonal. And it's really overall though, about 2/3 consumer when you consider time and noninterest-bearing and now. And that's really at an average size, it's much smaller. So it just doesn't have -- it has a little less pressure there, and that's really good for us. So we have really a consumer-oriented granular depository that's really served us well through the last 2 cycles.

Unknown Analyst

Okay. And then just 1 more. You were active on the buyback this quarter, and I know you said that you were going to resume them next week. Could you give any like color on the run rate or put in numbers to it? Or is that all we get?

James Reske

Yes. I just -- we announced because our Board authorized did a $25 million authorization. And then 1 of the reasons we do it in $25 million chunks like that, unlike the 1 we did last quarter with the $75 million is that, that allows us to do the repurchase just due to the amount of retained earnings we have after paying a dividend to shareholders. So we don't want to telegraph in advance because we don't always know in advance. And even if we do, we wouldn't want to say it is the precise timing of when we do those kinds of buybacks. I just can tell you that we'll be back in the market next week and so we'll be active in the buyback.

Operator

Your next question comes from the line of Daniel Tamayo from Raymond James.

Daniel Tamayo

Maybe just starting on the credit side, if you can just kind of touch on your thoughts on the path of resolution for the increase in the NPLs and the classifieds?

Thomas Michael Price

Yes. I'll turn it over to Brian, but I would just share with is, we had 3 identified credits that made up the bulk of the reserve -- specific reserves this quarter, they were identified. We still have probably about 20% of our criticized is really from our entree into Central Pennsylvania. So that's outsized, and we continue to work that down. And the complexion of that is probably about $60 million of $300 million or so criticized. There's just 1 larger loan in there that's about 10 and probably 1 over 5. And then after that, it's pretty granular.

Brian, what would you add?

Brian Sohocki

No. That's your good comments, Mike. And Obviously, the classified increase specifically this quarter. It was the result of the migration of 2 of the larger loans that moved into NPL. And generated reserve. The third loan was already a nonperforming loan that had some incremental reserve. So if you look at the increase, it was specific to these identified credits. To your question specific to the future, obviously, the resolution of those is our key focus, and that will drive the classify the nonperforming and the reserves moving forward.

To Mike's point, importantly, we're not seeing broad-based deterioration with new credits moving into the category. As you drill down into criticized loans and watch loans, our OAEM actually decreased by $25 million this past quarter, while the classified increased by $26 million. It's there where you really see the transition, the migration from the criticized into the classified. And when you drill down further into the watch loans, we're down over $100 million year-to-date.

So we're seeing good portfolio performance on the front end. And our focus here over the next coming quarters will be resolution of the nonperformers. At quarter end, we felt that the reserve was appropriate based on the collateral valuations. Each of those loans, as you would expect, is in different stages of collection and resolution and that will be our short-term focus.

Daniel Tamayo

Okay. And then I guess my follow-up would be just on the C&I loan growth side. We had, I guess, an inflection in growth this quarter. Just curious your thoughts around ability to continue the trend there as we look forward.

Thomas Michael Price

Yes. We feel like we're turning the corner. I would say that in fairness, some of that does include our equipment finance group, which has slowed down a bit. But we do have traction in our regions. And a focal point is C&I lending, both larger, all down small business and business banking. And it also remains a focus because those are cornerstone relationships that have a repeat with household value. So that is where our ground game is focused. And is a key for our growth.

However, that being said, as we look to the future, we have 6 lending buckets. We have HELOC -- loan out of the branches. We have mortgage, we have indirect auto. On the commercial side, we have CRE, C&I and then equipment finance. And we really want broad-based growth across all of those 6 categories and relationship value where we can get it. And so we're not looking for 8% or 10% growth in some category to pick it up. We've had years here. We had 2 or 3 years where we grew every region and every product line. And that's ideally how we'd like to grow it.

Daniel Tamayo

I appreciate that, Mike. And then maybe lastly, just on the on that loan growth topic again and probably more on the CRE side, but feel free to answer for any of the buckets. Just curious your thoughts on higher rates, kind of where we are and where we could be into next year, the impact that could have on the demand side?

James Reske

I think it will dampen demand. Mike, if anything you want to add?

Michael McCuen

No. You're right, Mike, it will dampen demand. What it comes just to that question.

Thomas Michael Price

Yes. And it will dampen demand, particularly on the commercial real estate side, I mean, half point a full point is going to just make some projects unfinanceable and/or maturing loans that much tougher. That being said, Jim, we have if rates do continue to go up, there's a beta on the short end and also on the longer end of the curve and replacement rate provided the volume can stay up there. Anything you would add?

James Reske

Yes. No. I mean, I think just on that topic, any -- what you're asking about, but the rate environment is a real goal to lock for us right now. It does allow us to continue to be pricing up for the fixed rate loans. So even if there's no if you don't meet our loan growth targets mid-single digits, and they've always been pretty modest. So we think they're achievable. That's what we're planning on now. But if we can, we see we price up for the book, which just works in our favor.

Operator

Your next question comes from the line of Carl Shepherd from RBC Capital Markets.

Unknown Analyst

I guess I wanted to start on the margin. Obviously, a really strong performance again in the quarter and a positive outlook. We can look at the numbers ourselves. But I'm curious your view. Is there anything that stands out? Do you think a lot of this is execution? Is it the environment? And then just kind of what could maybe not get off into for '20 and 4Q and kind of holding that into 2027? Knowing that deposit pricing is always the wildcard.

Thomas Michael Price

I think our loan yields have been going up. I think on the higher yielding and the lower yielding, we have good loan mix. I think we have good deposit mix that we might be able to hang rate and still overall keep our cost of deposits relatively flat. So I think we're in a nice place just because we have a granular depository. And we'll test that. And we actually will test at a couple of times within a quarter with certain specials and products, the team.

And so I think we're relatively well positioned, but things tend to play out a little differently. That being said, granular consumer-oriented depository, particularly on the longer end, if you have a bunch of $5,000 and $10,000 CDs and the opportunity cost of not getting the highest rate, it's not in tens of thousands of dollars if it was $1 million, it's in hundreds of dollars instead. And I think that portends well for us. We have 200,000-plus households in our consumer bank. And like I said, they're over -- well over 60% of the overall depository.

And then we have that noninterest-bearing Majority of that is business, which I mentioned earlier, and we're getting better and better. Our TM capabilities are getting better and getting some fee income, the team with that and having more solutions for our clients. So we're just -- we have a broad ground game. Now that's a little harder to manage sometimes, but there are benefits, and I don't know -- what you want to add?

Unknown Executive

Just to answer the question of the strategic or is it good fortune. I think if you reflect back on the first quarter, we talked about the fact that we came across some liquidity from the loan sale. We felt that gave us the opportunity to change the mix a little bit of our whole portfolio. We start to price down a little bit at the CD side, and we strategically really focused on noninterest-bearing.

So I think as we expected that time that we'd have some good success on deposit pricing, that showed up now. And now we probably have to think about pivoting a little bit towards focusing more on the growth side now that we got ourselves in a good position.

Thomas Michael Price

Yes. We do feel like and Jim started off, we really feel like we need to be a profitable bank on the net interest margin side, but we also feel a pressure to grow net interest income. And we have and we just don't feel like -- we feel like we can do better there or we should do better there, or we should do better.

Unknown Analyst

Okay. That's helpful. And then just a follow-up question. On the tax rate. Should we -- are you sort of pointing to a Q4 rate kind of like this quarter then and we just think about the benefit from, I guess, 23 and 24 and then 26 from a similar type purchase of an energy credit. Is that a fair way to think about or help us out, Jim, when where else in the peer [indiscernible].

James Reske

Yes. So what I'm trying to get some clarity on is that it's going to be a little lumpy at first until it gets into regular res. So because these tax credits are newly transferred, we're kind of making up for lost time. We wanted to give this 1 in before we filed our 25 return on October 15. And so that's why we started in the second quarter, and we be kind of got it done by the end of the third quarter. and that took care of the '25 liability. And now there's an opportunity to do 2026 pace back to tax years '23 and '24.

So our -- these tax credits, you can purchase them up to 75% of your federal tax liability. That number ends up being roughly $25 million per year for us roughly. So heated '26 and then '23 and '24, that's like $75 million worth of credit. So what I'm trying to telegraph is a lump like that coming through. Once that's done, then you get 2028 -- 2027 and '28, you start getting buying this every year as long as the law doesn't change. And the law seems to be favored by both conservatives and lips on both sides of the aisle for reducing taxes and promoting renewable energy.

So there's a good chance of it persist for a while. And so I'm trying to give as much of an outlook as I can for you guys to help you with the -- just use modeling a tax rate. When I talk about like 1 or 2 percentage points when we talk about the annual tax rate to we're -- the federal taxes rate is 21%. Right now, our effective tax rate is a little hair over 20 because we have a very small muni portfolio. We have BOLI, and those 2 things are -- as the balance sheet grows. We're not really adding to those things.

And so less-proportionately less mass of the balance sheet. So the effective tax rate a year or so ago was in the high 19s now. So It's very little hair over 20%. These federal tax credits, if you start getting that rhythm, could really bring that down, which should fall right to the bottom line. So trying to give as much queries I can with that noting the waters too much. So I hope that helps.

Operator

Your next question is from the line of Matthew Breese at Stephens Inc.

Matthew Breese

A few questions from me. Jim, on the NIM, I think you had said 2027, call it mid 2027, perhaps a NIM mentioned towards 420, which is pretty incredible, especially without anything esoteric on the balance sheet. But I also think I heard you say that's with no rate hikes. And it does feel like we're going to get anything from 1 to 3 hikes. How does that change kind of the NIM outlook?

James Reske

Yes. Thanks for asking. And I'm just trying to keep it high level so that you could take that information and apply your own rate forecast to it. But here's the thing I tried to do without getting too much into the weeds. We purchased an outside rate forecast. It's the same way forecast that most banks, I think, purchased. That rate forecast would have the short-term rates coming down to like the Fed funds like 3.62 by the end of next year.

And in fact, the entire yield curve going experiencing a parallel downshift. That assumes that inflation is under control, the they can cut rates a whole bunch of things. that scenario, the short-term rate as is a December hike in it. So the short-term rate comes up. We benefit from that. The NIM expands, we peak in the first quarter and then start trailing off. puts a lot of complexity to taking to account, and this is a ton of assumptions on how the future is going to play itself out. So we try to simplify that and say, let's just assume nothing changes. The yield curve is frozen.

We got to temper hike and nothing else. What happens? And that's the Goldilocks scenario I mentioned earlier. That's really good for us. The curve has had some steepness to it. The repricing of the fixed rate loan portfolio continues, it was really good in the third quarter. And that continues

to.

[Audio Gap]

Mentioned you're here opening 4 that you're really starting to pay attention as a high priority. The level of NPAs where they're at, it's starting to feel less fluky less kind of like one-off fraud situations that we had 12, 18 months ago. Could you maybe help us out what are the top 3 NPAs? What are they geography asset class wise? Is there any future loss content better than them? And what are you doing to kind of reverse the trend here? Or is it a function of higher rates and a little bit more credit notes?

Thomas Michael Price

Yes. Just maybe I'll start with what we have done. And just on the SBA, we've really stopped our out-of-footprint lending. That's about 20% of NPLs. Mike mentioned the loan sale in the eastern part of the state last year, and we've really closed that production office there. We've limited our leveraged finance and our dealer floor plan businesses. We bolstered our portfolio management.

And at the end of the day, those are all good things, but we've also -- right now, 20% of the texture of our classified, criticized and if we look at our charge-off history, the last several years is really our entree into Central Pennsylvania. And so I mentioned we are now down to about $300 million there with about $60 million and criticized. So that's a lot of work on a portfolio that when we acquired it was just under $1 billion. And at the same time, we've been able to be profitable and move forward.

Now I've calculated the delta on the delta on that is 14 to 15 basis points over where we would have been otherwise, which is real money. And you and I have talked about that. And so I do feel like I said this a year ago, and I know you're reminding me of is we're in the latter innings of this. But I feel like we are in the latter innings of it. When you asked about the top 3 I think of the Central Pennsylvania C&I loan. I think of a downtown Pittsburgh-based multifamily -- multifaceted development opportunity.

And the third 1 would be an Ohio student housing project. And each of those is -- I could give you the $1 over $10 just under 10 and 2 just under 10. Brian, what would you add?

Brian Sohocki

Yes. I'll just add a couple of anecdotal comments to build on, Mike. So he mentioned the $60 million of criticized loans that we have on the books from the Centric acquisition. I think the -- taking one step further into that, the positive about it is there's 1 loan over $10 million. There's very limited nonperforming. So to your impaired question, there's about $5 million or $6 million of impaired in that portfolio.

So once you get past the 1 larger criticized loan, that's in that $60 million bucket. It's very granular and very manageable. And I think we've been deliberate in the market. We've added credit talent on top of the actions around the portfolio that Mike referenced. So not completely out of the woods with the headwind there, and there's always some variability with reducing that $60 million, but I feel it's granular and becomes manageable.

And then as you look at the top impaired loans in the nonperforming bucket. Overall, and Mike referenced the 3 from this past quarter. Those are 3 of the top 4 loans in our impaired loan bucket. The larger C&I credit that came in this quarter at $16 million is the largest in that portfolio, the $5 million mixed-use Pittsburgh credit, that came into nonaccrual this quarter is one of those top 4 loans. So $21 million kind of flowed in to the nonperforming nonaccrual bucket this period and comps for 2 of those top 4.

And it's worth just providing a little more color. The 1 that was already in as one of the top nonperforming, we added some provision and reserve through this period. That's an existing. It's an $11 million loan, and it's, I guess, the second largest nonperformer we have. It's also a Pittsburgh mixed-use multifamily property. So hopefully, that provides a little color. Once you move out of the top 3 loans are the only ones of magnitude from the fourth loan on through the 25th it drops below $5 million declines in size very quickly on a per loan basis. So I feel, again, the granularity is a positive and to continue as we continue to work through it.

Operator

[Operator Instructions] Your next question is from the line of Manuel Navas from Piper Sandler.

Manuel Navas

I appreciate all the commentary on credit, but what do you feel like kind of the time line for all that? Is there a best guess? We said a couple of quarters of 30 to 32 basis points of maybe higher net charge-offs. Is that still hold? Like I know this quarter was a little bit better because some recoveries. But just kind of thoughts on that go-forward look of charge-offs or provisioning.

Brian Sohocki

Yes. We don't provide specific guidance to the future quarter reserve and provisioning as we work through those specific credits we discussed I do recognize that this quarter was heavy on reserve and light on charge-offs and we would expect to work through these credits in the next couple of quarters. And we did allocate based on our collateral and our workout strategies on those loans. And I would expect that barring unforeseen events, we kind of manage within our typical provision going forward. Mike you want to add to that?

Thomas Michael Price

This quarter was, I think, our highest provisioning quarter we've had ever, and $3.5 million of that was unfunded, which are primarily construction loans that they'll get funded later, but still, it's it was the highest. I would -- I think we should hopefully get back down under $10 million, but we'll see. And Manuel, I wish I could -- I had a crystal ball here. We will get it to converge with towards pure numbers and that's what we're focused on.

Manuel Navas

A component of the provision this quarter was that those unfunded commitments. Does that mean that there's potential for stronger near-term growth? Or is that kind of spread out over time? I didn't realize the construction, but go ahead.

Thomas Michael Price

Yes. Through 3.5 million would be committed lines, which would be primarily construction lending on the commercial side. And then also, we've really had a nice year on HELOC lending out of branches. So those would be -- you would expect takedowns on both the HELOC and the construction over the course of the next year to 18 months. So that's the good question, if you will, and the provision expense, if there is such a thing.

Brian Sohocki

Sorry, Manuel. There was over $100 million of investment real estate construction growth in the quarter. And as you would expect, those are going to fund over a 12 to 18 month period on average, usually an equity phase for the first ramp-up period. So the that construction portfolio has been growing over the course of 2026. So we see nice incremental growth being funded out of that, and we'll see kind of some more incremental benefit in 2 quarters as you see those loans start fund.

Manuel Navas

Yes. We've been watching for a kind of a return to mid-single-digit pace. I guess 3% can accounts this quarter. Do you think that you accelerate near term? Or is it just kind of slow rise process from here into next year?

Thomas Michael Price

Well, I think prognostication, probably, I think we can hopefully keep at that pace or a little higher in the fourth quarter. Beyond that, you talked a little bit about rising rates and what that might mean for family-owned businesses, consumers and others. In our mortgage business, we've had a lot of gain on sale income this year. And they've kind of battled through it and they felt the rate increases in the volume in late August.

I can almost remember the week where we were just kind of on fire for 8.5 months. And then we saw just a little downtick, but we were able to keep it up. But you just -- you worry a little bit about the state of the consumer and the -- particularly the family and the small business and the impact on them. So that's why a little tepid around -- we're not in a sun belt. We're in community, in Pennsylvania and Ohio, which is a little different texture.

But quite frankly, there's a lot happening here with energy data centers in our backyard that could really propel us even if we were to get into a ticket you might not have a recession or the same kind of ticket in Central and Southern Ohio and Western Pennsylvania that you might have in the rest of the country. So that's another thing that we felt a little bit impervious through the last cycles. Both on our indirect auto book tended to perform really well, 30 to 40 basis points of losses even through some tough cycles. So there is something about this area of the country, Western Pennsylvania and Ohio where -- they performed well through the last couple of cycles.

Operator

There are no further questions at this time. I will now turn the call back to Mike Price for closing remarks.

Thomas Michael Price

Yes. As always, we appreciate the questions and the challenges, the encouragement. We're so excited about the future of our company. We've always been kind of sharp the last couple of years with fintech investments and things like that. And we just -- we'll continue that. And we're looking at some really capable tools that can help us with everything from next best product to data-driven insights, call center efficiencies, smarter ways to work and done a lot with anti-fraud and information security and money movement.

And just excited about continuing the pace of investment there. And I think we've highlighted in some of our investor calls, we have 35 fintech partners and just the democratization of technology and what it might mean for a company of our size and how we can compete and excited about that as we look to the future and try to bring the best of the community banking experience but also just have a level of specification where we could remain relevant to our clients.

And just thank you for your interest in our company and appreciate your questions today.

Operator

This concludes today's call. Thank you for attending. You may now disconnect.