FNB Q3 2026 Earnings: Record Net Interest Income Supports EPS Growth

F.N.B. Corporation (NYSE: FNB) reported Q3 2026 net interest income of $376.5 million, up 4.8% from $359.3 million a year earlier, while diluted EPS increased to $0.43 from $0.41. Net income rose 2.2% to $152.9 million as net interest margin expansion and a lower credit-loss provision outweighed weaker fee income and higher operating expenses.

Core Earnings Data

FNB released results on October 19 for the quarter ended September 30, 2026. Growth in average earning assets and lower interest-bearing deposit costs supported net interest income, while the provision for credit losses declined as net charge-offs improved.

GAAP and operating net income were identical in Q3 2026 because there were no significant items affecting the quarter. The prior-year GAAP result included a favorable $1.8 million after-tax adjustment related to a reduction in the FDIC special assessment; excluding that item, operating net income increased 3.5% year over year.

The FTE net interest margin is a non-GAAP measure that adjusts interest income from tax-exempt assets to a taxable-equivalent basis.

Loan and Deposit Growth

Average loans and leases reached $36.1 billion, up $1.3 billion, or 3.7%, year over year. Consumer loans contributed $1.2 billion of the increase, while average commercial loans and leases grew by $115.4 million. Within the commercial portfolio, average commercial and industrial loans rose 11.3%, helped by equipment finance production and growth in Charlotte, Pittsburgh and other Pennsylvania markets. That increase offset a 5.8% decline in commercial real estate loans.

Consumer growth was broad based. Average residential mortgages increased 10.0%, consumer lines of credit rose 12.9%, and indirect auto loans grew 17.4%. Period-end total loans increased $768.0 million from the previous quarter, equivalent to an annualized growth rate of 8.5%.

Average deposits were $38.8 billion, up 2.4% year over year. Growth in money market and demand deposits more than offset a $334.8 million decline in average time deposits. Period-end deposits increased $870.6 million sequentially, or 8.9% annualized, while non-interest-bearing deposits remained 26% of total deposits. The loan-to-deposit ratio was 92.4%, nearly unchanged from 92.5% in the previous quarter but above 90.9% a year earlier.

Margin Expansion Offset Fee and Expense Pressure

The main earnings driver was the spread between asset yields and funding costs. Compared with Q3 2025, the yield on earning assets declined 18 basis points to 5.18%, but the total cost of funds fell by a larger 22 basis points to 2.01%. Interest-bearing deposit costs declined 29 basis points to 2.37%, allowing the FTE net interest margin to expand despite lower loan yields.

The sequential trend was also favorable for the margin. Earning-asset yields rose five basis points from Q2, while the cost of funds increased two basis points and interest-bearing deposit costs were nearly stable. This lifted the FTE net interest margin by four basis points from the previous quarter.

Non-interest income provided an offsetting headwind. Mortgage banking income fell 39.4% to $5.6 million because of tighter gain-on-sale margins and fair-value adjustments amid interest-rate volatility. Capital markets income declined 18.4% to $6.4 million, while other income fell because the prior-year quarter included a $5.4 million recovery on an asset previously written off. Service charges and wealth management revenue increased, but not enough to offset those declines.

Non-interest expense rose 5.5%, reflecting technology-related investments, higher occupancy costs, and increased legal and consulting expenses. The non-GAAP efficiency ratio increased to 53.71% from 52.38% a year earlier, indicating that expense growth outpaced adjusted revenue growth, although the ratio was essentially stable from Q2. Reported pre-provision net revenue declined approximately 0.8% year over year to $212.2 million, while operating pre-provision net revenue increased approximately 0.3% after adjusting for the prior-year FDIC item.

Credit Quality and Capital

Credit costs declined even as some delinquency measures moved higher. Net charge-offs fell to $11.0 million, or 0.12% of average loans on an annualized basis, from $19.7 million, or 0.22%, a year earlier. The provision for credit losses decreased to $19.6 million, and the allowance for credit losses increased to $455.5 million while remaining stable at 1.25% of total loans.

Non-performing loans and other real estate owned represented 0.33% of loans and OREO, down from 0.37% a year earlier but up from 0.31% in Q2. Total delinquency increased to 0.75% from 0.65% a year earlier and 0.71% in the previous quarter, making the direction of early-stage credit indicators an important item to monitor.

FNB’s estimated CET1 capital ratio was 11.3%, compared with 11.1% a year earlier and 11.4% in Q2. Non-GAAP tangible book value per share increased 7.0% year over year to $12.28. However, accumulated other comprehensive loss reduced tangible book value by $0.53 per share, compared with $0.22 a year earlier, primarily because higher interest rates lowered the fair value of available-for-sale securities.

The company repurchased $51 million of common stock during the quarter, representing 2.7 million shares at a weighted average price of $18.69. Year-to-date repurchases totaled $133 million, or 7.4 million shares.

Management View

Chairman, President and CEO Vince Delie attributed loan and deposit growth to technology investments and expansion across FNB’s geographic markets. Management’s strategy remains focused on building primary customer relationships and lower-cost deposits while expanding fee-based businesses to diversify revenue, although fee income declined during the quarter. Management also pointed to consistent underwriting standards as a factor supporting current credit quality.

Risks Investors Need to Watch

• Fee-income weakness: Mortgage banking and capital markets revenue declined, leaving earnings more dependent on net interest income. Continued interest-rate volatility could keep these businesses uneven.
• Expense growth: Non-interest expense increased faster than net interest income, and the efficiency ratio deteriorated year over year. Technology, occupancy, legal and consulting costs remain important to future operating leverage.
• Rising delinquency indicators: Charge-offs and provisions improved, but total delinquency rose both sequentially and year over year, while the non-performing loan ratio increased from Q2.
• Interest-rate sensitivity: Funding costs edged higher sequentially, and the AOCI reduction to tangible book value widened. Future asset and liability repricing will affect whether the recent margin expansion can continue.
• Commercial real estate exposure: Period-end commercial real estate loans totaled $11.9 billion, including 67% classified as non-owner occupied. The portfolio declined 5.0% year over year, but its size keeps commercial property conditions relevant to credit performance.

Summary

FNB’s Q3 2026 earnings benefited from record net interest income, modest margin expansion, loan and deposit growth, and lower credit costs. Those gains were partly offset by weaker mortgage banking and capital markets income and continued expense growth. The next key indicators are the sustainability of the wider margin, progress on fee revenue and operating efficiency, and whether rising delinquencies translate into higher future credit costs.