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What changed in FNB CORP/PA/'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of FNB CORP/PA/'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+468 added−488 removedSource: 10-K (2026-02-24) vs 10-K (2025-02-27)

Top changes in FNB CORP/PA/'s 2025 10-K

468 paragraphs added · 488 removed · 337 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

93 edited+33 added−30 removed130 unchanged
Biggest changeIn view of changing conditions in the national economy and in money markets, as well as the effect of credit policies by monetary and fiscal authorities, including the FRB, it is difficult to predict the impact of possible future changes in interest rates, deposit levels and loan demand, or their effect on our business and earnings or on the financial condition of our various customers (see discussion under Risk Factors - caption “ We could be adversely affected by changes in the law, especially changes in the regulation of the banking industry ”).
Biggest changeIn view of changing conditions in the national economy and in money markets, as well as the effect of credit policies by monetary and fiscal authorities, including the FRB, it is difficult to predict the impact of possible future changes in interest rates, deposit levels and loan demand, or their effect on our business and earnings or on the financial condition of our various customers (see discussion under Risk Factors - caption “ We could be adversely affected by changes in the law, especially changes in the regulation of the banking industry. ”) Available Information We make available through our website at www.fnbcorporation.com, free of charge, our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K (and amendments to any of the foregoing) as soon as reasonably practicable after such reports are filed with or furnished to the SEC.
No material portion of the loans or deposits of the Community Banking segment has been obtained from a single customer or small group of customers, and the loss of any one customer’s loans or deposits or a small group of customers’ loans or deposits by the Community Banking segment would not have a material adverse effect on the Community Banking segment specifically 4 Table of Contents or on FNB generally.
No material portion of the loans or deposits of the Community Banking segment has been obtained from a single customer or small group of customers, and the loss of any one customer’s loans or deposits or a small group of customers’ loans or deposits 4 Table of Contents by the Community Banking segment would not have a material adverse effect on the Community Banking segment specifically or on FNB generally.
The various regulatory agencies have adopted substantially similar regulations that define the five capital categories identified by FDICIA, using the CET1, Tier 1 risk-based capital, total risk-based capital, and leverage capital ratios as the relevant capital measures.
The various regulatory agencies have adopted substantially similar regulations that define the five capital categories identified by FDICIA, using the CET1 capital, Tier 1 risk-based capital, total risk-based capital, and leverage capital ratios as the relevant capital measures.
These Heightened Standards require covered banks to establish and adhere to a written governance framework in order to manage and control their risk-taking activities, provide standards for covered banks’ boards of directors to oversee the risk governance framework, and describe the appropriate risk management roles and responsibilities of front line units, independent risk management, and internal audit functions.
These Heightened Standards require covered banks to establish and adhere to a written risk management governance framework in order to manage and control their risk-taking activities, provide standards for covered banks’ boards of directors to oversee the risk governance framework, and describe the appropriate risk management roles and responsibilities of front line units, independent risk management, and internal audit functions.
In general, subject to certain exceptions as discussed further below, minimum capital standards established under the agencies’ risk-based capital regulations include a CET1 capital to risk-weighted assets ratio of 4.5 percent, a Tier 1 capital to risk-weighted assets ratio of 6.0 percent, a total capital to risk-weighted assets ratio of 8.0 percent, and a leverage ratio of Tier 1 capital to adjusted average total assets of 4.0 percent.
In general, subject to certain exceptions as discussed further below, minimum capital standards established under the agencies’ risk-based capital regulations include a CET1 capital to risk-weighted assets ratio of 4.5%, a Tier 1 capital to risk-weighted assets ratio of 6.0%, a total capital to risk-weighted assets ratio of 8.0%, and a leverage ratio of Tier 1 capital to adjusted average total assets of 4.0%.
Among other things, these laws and regulations: • require banks to disclose credit terms in meaningful and consistent ways; 14 Table of Contents • prohibit discrimination against an applicant in any consumer or business credit transaction; • prohibit discrimination in housing-related lending activities; • require banks to collect and report applicant and borrower data regarding loans for home purchases or improvement projects; • require lenders to provide borrowers with more detailed information regarding the nature and cost of real estate settlements; • prohibit certain lending practices and limit escrow account amounts with respect to real estate transactions; • prescribe possible penalties for violations of the requirements of consumer protection statutes and regulations; • require prescribed consumer disclosures and the adoption of error resolution procedures and other consumer protection protocols with respect to electronic fund transfers; and • prohibit unfair, deceptive or abusive acts and practices in connection with consumer loans, the collection of debt, and the provision of other consumer financial products and services, including identifying risks associated with certain overdraft practices.
Among other things, these laws and regulations: • require banks to disclose credit terms in meaningful and consistent ways; • prohibit discrimination against an applicant in any consumer or business credit transaction; • prohibit discrimination in housing-related lending activities; • require banks to collect and report applicant and borrower data regarding loans for home purchases or improvement projects; • require lenders to provide borrowers with more detailed information regarding the nature and cost of real estate settlements; • prohibit certain lending practices and limit escrow account amounts with respect to real estate transactions; • prescribe possible penalties for violations of the requirements of consumer protection statutes and regulations; • require prescribed consumer disclosures and the adoption of error resolution procedures and other consumer protection protocols with respect to electronic fund transfers; and • prohibit unfair, deceptive or abusive acts and practices in connection with consumer loans, the collection of debt, and the provision of other consumer financial products and services, including identifying risks associated with certain overdraft practices.
Also included in Tier 2 capital is the allowance for loan losses limited to a maximum of 1.25 percent of risk-weighted assets. Calculation of all types of regulatory capital is subject to deductions and adjustments specified in the regulations.
Also included in Tier 2 capital is the allowance for loan losses limited to a maximum of 1.25% of risk-weighted assets. Calculation of all types of regulatory capital is subject to deductions and adjustments specified in the regulations.
Competition for loans and deposits depends on a number of factors, including, among others, customer service, quality and range of products and services offered, price, reputation, interest rates on loans and deposits and lending limits.
Competition for loans and deposits depends on a number of factors, including, among others, customer service, quality, convenience and range of products and services offered, price, reputation, interest rates on loans and deposits and lending limits.
The definition of a "covered cyber-incident" will be determined by CISA rulemaking, but SACA provides that, at a minimum, an incident must be reported if it: (1) leads to "substantial loss of confidentiality, integrity, or availability" of an 15 Table of Contents information system or network or a "serious impact on the safety and resiliency of operational systems and processes"; (2) causes a "disruption of business or industrial operations, including due to a denial of service attack, ransomware attack, or exploitation of a zero day vulnerability" against an information system or network, or an operational technology system or process; or (3) involves "unauthorized access or disruption of business or industrial operations" due to a "compromise of a cloud service provider, managed service provider, or other third-party data hosting provider or by a supply chain compromise".
The definition of a "covered cyber-incident" will be determined by CISA rulemaking, but SACA provides that, at a minimum, an incident must be reported if it: (1) leads to "substantial loss of confidentiality, integrity, or availability" of an information system or network or a "serious impact on the safety and resiliency of operational systems and processes"; (2) causes a "disruption of business or industrial operations, including due to a denial of service attack, ransomware attack, or exploitation of a zero day vulnerability" against an information system or network, or an operational technology system or process; or (3) involves "unauthorized access or disruption of business or industrial operations" due to a "compromise of a cloud service provider, managed service provider, or other third-party data hosting provider or by a supply chain compromise".
Projects achieve certification by following prerequisites and earning credits related to green building, with the aim to protect resources and enhance individual human health and community quality of life, among other goals. 7 Table of Contents Information About Our Executive Officers The name, age and principal occupation for each of our executive officers as of January 31, 2025 are set forth below: Name Age Principal Occupation Vincent J.
Projects achieve certification by following prerequisites and earning credits related to green building, with the aim to protect resources and enhance individual human health and community quality of life, among other goals. 7 Table of Contents Information About Our Executive Officers The name, age and principal occupation for each of our executive officers as of January 31, 2026 are set forth below: Name Age Principal Occupation Vincent J.
This team, chaired by FNB’s Chairman, President and Chief Executive Officer, regularly meets to promote compensation programs that are fair and equitable, to achieve a performance-driven work culture that generates company growth and to reward employees for focusing on customer needs, while avoiding inappropriate conduct regarding our clients, and demonstrating appropriate risk management behaviors. Values & Training.
This team, chaired by FNB’s Chairman, President and Chief Executive Officer, regularly meets to promote compensation programs that are fair and impartial, to achieve a performance-driven work culture that generates company growth and to reward employees for focusing on customer needs, while avoiding inappropriate conduct regarding our clients, and demonstrating appropriate risk management behaviors. Values & Training.
As a response to the health and safety risks exposed during the COVID-19 outbreak our new headquarters building features HVAC systems that are specifically designed to mitigate risks from airborne pathogens using state of the art filtration, Air Handling and Ionization indoor air systems. The new headquarters was certified Leadership in Energy and Environmental Design (LEED) Gold by the U.S.
As a response to the health and safety risks exposed during the COVID-19 outbreak our headquarters building features HVAC systems that are specifically designed to mitigate risks from airborne pathogens using state-of-the-art filtration, Air Handling and Ionization indoor air systems. In 2024, our headquarters building was certified Leadership in Energy and Environmental Design (LEED) Gold by the U.S.
Consumer Protection Statutes and Regulations FNBPA is subject to various federal consumer protection laws and regulations including the TILA, Truth in Savings Act, ECOA, Fair Housing Act, Real Estate Settlement Procedures Act, Fair Debt Collection Practices Act, Fair Credit Reporting Act, Electronic Fund Transfer Act and Home Mortgage Disclosure Act, and regulations and guidance promulgated thereunder by the CFPB and the federal banking agencies, as well as certain state consumer protection requirements.
Consumer Protection Statutes and Regulations FNBPA is subject to various federal consumer protection laws and regulations including the Truth in Lending Act, Truth in Savings Act, ECOA, Fair Housing Act, Real Estate Settlement Procedures Act, Fair Debt Collection Practices Act, Fair Credit Reporting Act, Electronic Fund Transfer Act and Home Mortgage Disclosure Act, and regulations and guidance promulgated thereunder by the CFPB and the federal banking agencies, as well as certain state consumer protection requirements.
Heightened Standards for Risk Management Governance The OCC’s Heightened Standards establish guidelines for the governance and risk management practices of OCC-regulated institutions with total consolidated assets of $50 billion or greater.
Heightened Standards for Risk Management Governance The OCC’s Heightened Standards establish guidelines for the governance and risk management practices of OCC-regulated institutions with average total consolidated assets of $50 billion or greater.
This guidance, which covers all employees that have the ability to materially affect the risk profile of an organization, either individually or as part of a group, is based upon the key principles 16 Table of Contents that a banking organization’s incentive compensation arrangements should (i) provide incentives that appropriately balance risk and financial results in a manner that does not encourage employees to expose their organizations to imprudent risk, (ii) be compatible with effective controls and risk management, and (iii) be supported by strong corporate governance, including active and effective oversight by the organization’s board of directors.
This guidance, which covers all employees that have the ability to materially affect the risk profile of an organization, either individually or as part of a group, is based upon the key principles that a banking organization’s incentive compensation arrangements should (i) provide incentives that appropriately balance risk and financial results in a manner that does not encourage employees to expose their organizations to imprudent risk, (ii) be compatible with effective controls and risk management, and (iii) be supported by strong corporate governance, including active and effective oversight by the organization’s board of directors.
In assessing an institution’s capital adequacy, the OCC takes into consideration not only these numeric factors, but qualitative factors as well, and has the authority to establish higher capital requirements for individual institutions where deemed necessary. Management believes that as of December 31, 2024, FNB and FNBPA meet all capital adequacy requirements including the capital conservation buffer.
In assessing an institution’s capital adequacy, the OCC takes into consideration not only these numeric factors, but qualitative factors as well, and has the authority to establish higher capital requirements for individual institutions where deemed necessary. Management believes that as of December 31, 2025, FNB and FNBPA meet all capital adequacy requirements including the capital conservation buffer.
We regularly seek feedback from our employees and in 2024 participated in several regional Top Workplace surveys. Our outstanding scores continue to help us achieve external recognition as an employer of choice. Compensation. Our compensation philosophy is to maintain a program that supports our mission and values.
We regularly seek feedback from our employees and in 2025 participated in several regional Top Workplace surveys. Our outstanding scores continue to help us achieve external recognition as an employer of choice. Compensation. Our compensation philosophy is to maintain a program that supports our mission and values.
The centralization of these processes enables us to maintain consistent quality of these functions and to achieve certain economies of scale. As of December 31, 2024, we have three reportable business segments: Community Banking, Wealth Management and Insurance. Our remaining operations are described in Other .
The centralization of these processes enables us to maintain consistent quality of these functions and to achieve certain economies of scale. As of December 31, 2025, we have three reportable business segments: Community Banking, Wealth Management and Insurance. Our remaining operations are described in Other .
During 2024, the FDIC revised its loss estimate and projected that the special assessment would be collected for an additional two quarters beyond its initial eight-quarter collection period. As a result, FNBPA recognized an additional special assessment charge of $5.2 million in 2024. Brokered Deposits .
During 2024, the FDIC revised its loss estimate and projected that the special assessment would be collected for an additional two quarters beyond its initial eight-quarter collection period. As a result, FNBPA recognized an additional special assessment charge of $5.2 million in 2024.
Additionally, Bank Capital Services, LLC, a subsidiary of FNBPA, offers commercial loans and leases to customers in need of new or used equipment. As of December 31, 2024, our Community Banking segment operated in seven states and the District of Columbia.
Additionally, Bank Capital Services, LLC, a subsidiary of FNBPA, offers commercial loans and leases to customers in need of new or used equipment. As of December 31, 2025, our Community Banking segment operated in seven states and the District of Columbia.
FNBPA is also subject to certain regulatory requirements of the CFPB, the FDIC, the FRB and other federal and state regulatory agencies, including but not limited to, requirements to maintain reserves against deposits, capital requirements, limitations regarding dividends, restrictions on the types and amounts of loans that may be granted and the interest that may be charged on loans, affiliate transactions, CRA, consumer compliance and anti-discrimination laws and unfair, deceptive or abusive acts and practices prohibitions, monitoring obligations under the federal bank secrecy act and anti-money laundering requirements, limitations on the types of investments that may be made, cybersecurity and consumer privacy requirements, activities that may be engaged in and types of services that may be offered.
FNBPA is also subject to certain regulatory requirements of the CFPB, the FDIC, the FRB and other federal and state regulatory agencies, including but not limited to, requirements to maintain reserves against deposits, capital requirements, limitations regarding dividends, restrictions on the types and amounts of loans that may be granted and the interest that may be charged on loans, affiliate transactions, CRA, consumer compliance and anti-discrimination laws and unfair, deceptive or abusive acts and practices prohibitions, monitoring obligations under the BSA and anti-money laundering requirements, limitations on the types of investments that may be made, cybersecurity and consumer privacy requirements, activities that may be engaged in and types of services that may be offered.
In August 2020, the federal banking agencies issued a final rule providing banking institutions that had adopted the CECL accounting standard in the 2020 calendar year with the option to delay for two years the estimated impact of CECL on regulatory capital, followed by a three-year transition period to phase out the aggregate amount of the capital benefit provided during the initial two-year delay (i.e., a five-year transition in total).
In August 2020, the federal banking agencies issued a final rule providing banking institutions that had adopted the CECL accounting standard in the 2020 calendar year with the option to delay for two years the estimated impact of CECL on regulatory capital, followed by a three-year transition period to phase out the aggregate amount of the capital benefit provided 9 Table of Contents during the initial two-year delay (i.e., a five-year transition in total).
Under these guidelines, FNBPA was considered well-capitalized as of December 31, 2024. Dividend Restrictions Our primary source of funds for cash distributions to our shareholders, and funds used to pay principal and interest on our indebtedness, is dividends received from FNBPA.
Under these guidelines, FNBPA was considered well-capitalized as of December 31, 2025. Dividend Restrictions Our primary source of funds for cash distributions to our shareholders, and funds used to pay principal and interest on our indebtedness, is dividends received from FNBPA.
The recent opening of our new state of the art headquarters building prioritizes employee safety in a facility that is fully ADA compliant, has full security access controls and closely manages and monitors guests and visitors entering our space.
Our new state-of-the-art headquarters building prioritizes employee safety in a facility that is fully ADA compliant, has full security access controls and closely manages and monitors guests and visitors entering our space.
Our executive compensation program is overseen by the Compensation Committee of our Board of Directors, in collaboration with a leading independent compensation advisory firm. In addition, the oversight and review of our company-wide compensation philosophy and programs are conducted by the Management Compensation Committee.
Our executive compensation program is overseen by the Compensation Committee of our Board of Directors (composed entirely of independent directors), in collaboration with a leading independent compensation advisory firm. In addition, the oversight and review of our company-wide compensation philosophy and programs are conducted by the Management Compensation Committee.
The goals of FNIA are to grow revenue through cross-selling to existing clients of the Community Banking segment and to gain new clients through its own channels. Our Insurance segment also includes a reinsurance subsidiary, Penn-Ohio. Penn-Ohio is not actively underwriting new policies. Additionally, FNBPA owns a direct subsidiary, First National Corporation, which offers title insurance products.
The goals of FNIA are to grow revenue with existing clients of the Community Banking segment and to gain new clients through its own channels. Our Insurance segment also includes a reinsurance subsidiary, Penn-Ohio. Penn-Ohio is not actively underwriting new policies. Additionally, FNBPA owns a direct subsidiary, First National Corporation, which offers title insurance products.
As of December 31, 2024, we had three reportable business segments, with the largest being the Community Banking segment which consists of a regional bank serving seven states and the District of Columbia.
As of December 31, 2025, we had three reportable business segments, with the largest being the Community Banking segment which consists of a regional bank serving seven states and the District of Columbia.
We use internally created digital marketing developed algorithms and data tools to increase job posting visibility within a broad range of job boards. We have committed to creating a strong and growing internship program to funnel high potential talent into our Development Programs within FNB to help with career growth.
We use internally created digital marketing-developed algorithms and data tools to increase job posting visibility within a broad range of job boards. We have committed to creating a strong and growing internship program to funnel high potential talent into our 6 Table of Contents Development Programs within FNB to help with career growth.
We continue to build succession and are devoted to following the Fair Hiring Practices Act and Fair Chance Act. Employee Development. We focus resources on programs to develop leaders and promote internal advancement within the organization.
We continue to build our internal succession planning and are devoted to following the Fair Hiring Practices Act and Fair Chance Act. Employee Development. We focus resources on programs to develop leaders and promote internal advancement within the organization.
As part of its award program, Energage highlighted FNB’s cultural excellence in categories such as innovation, leadership, work-life flexibility, compensation and benefits, professional development, and employee appreciation and well-being.
As part of its award program, Energage highlighted FNB’s cultural excellence in categories such as innovation, leadership, work-life flexibility, professional development, and employee appreciation and well-being.
Technology is not only important with respect to the delivery of financial services, risk management, regulatory compliance and security of customer information, but also in processing information. FNB and each of our subsidiaries continually make technological investments to remain competitive in the financial services industry.
Technology is not only important with respect to the delivery of financial services, risk management, regulatory compliance and security of customer information, but also in processing information. FNB and each of our subsidiaries continually make technological investments to remain competitive in the financial services industry, including the use of AI.
In connection with its adoption of CECL on January 1, 2020, FNB elected to utilize the five-year CECL transition, which concluded as of December 31, 2024.
In connection with its adoption of CECL on January 1, 2020, FNB elected to utilize the five-year CECL transition, which concluded as of December 31, 2025.
The FDIC retained the ability to extend the special assessment collection period or impose a one-time shortfall special assessment if the amount collected by the special assessment does not meet the final loss 12 Table of Contents amounts of Silicon Valley Bank and Signature Bank after the termination of the receiverships.
The FDIC retained the ability to extend the special assessment collection period or impose a one-time shortfall special assessment if the amount collected by the special assessment does not meet the final loss amounts of Silicon Valley Bank and Signature Bank after the termination of the receiverships.
The USA PATRIOT Act of 2001 (USA PATRIOT Act), which amended the Bank Secrecy Act of 1970 (BSA), substantially broadened the scope of U.S. anti-money laundering laws and regulations by imposing significant new compliance and due diligence obligations, creating new crimes and penalties and expanding the extra-territorial jurisdiction of the U.S.
The USA PATRIOT Act of 2001 (USA PATRIOT Act), which amended the BSA, substantially broadened the scope of U.S. anti-money laundering laws and regulations by imposing significant new compliance and due diligence obligations, creating new crimes and penalties and expanding the extra-territorial jurisdiction of the U.S.
The failure of a financial institution to maintain and implement adequate programs to combat money laundering and terrorist financing, or to comply with all of the relevant laws or regulations, could have serious legal, including criminal law enforcement, and reputational consequences for the institution.
The failure of a financial institution to maintain and 15 Table of Contents implement adequate programs to combat money laundering and terrorist financing, or to comply with all of the relevant laws or regulations, could have serious legal, including criminal law enforcement, and reputational consequences for the institution.
Monetary Policy The operations of FNB and our subsidiaries are affected not only by general economic conditions, but also by the policies of various regulatory authorities and the current Presidential Administration. In particular, the FRB regulates monetary policy and interest rates in order to influence general economic conditions.
Monetary Policy The operations of FNB and our subsidiaries are affected not only by general economic conditions, but also by the policies of various regulatory authorities and the current U.S. administration. In particular, the FRB regulates monetary policy and interest rates in order to influence general economic conditions.
We consider the Community Banking segment an important source of revenue opportunity through the cross-selling of products and services offered by our other business segments.
We consider the Community Banking segment an important source of revenue opportunity through products and services offered by our other business segments.
Total capital is defined as Tier 1 capital and Tier 9 Table of Contents 2 capital, which is comprised of capital instruments and related surplus, meeting specified requirements, and may include cumulative preferred stock and long-term perpetual preferred stock, mandatory convertible securities, intermediate preferred stock and subordinated debt.
Total capital is defined as Tier 1 capital and Tier 2 capital, which is comprised of capital instruments and related surplus, meeting specified requirements, and may include cumulative preferred stock and long-term perpetual preferred stock, mandatory convertible securities, intermediate preferred stock and subordinated debt.
In addition, the ability of FNB and FNBPA to pay dividends may be affected by the various minimum capital requirements and prompt corrective action standards previously described in the “Capital Adequacy Requirements” and “Prompt Corrective 10 Table of Contents Action” discussions herein.
In addition, the ability of FNB and FNBPA to pay dividends may be affected by the various minimum capital requirements and prompt corrective action standards previously described in the “Capital Adequacy Requirements” and “Prompt Corrective Action” discussions herein.
Employees complete quarterly and annual training, including regarding regulatory and compliance requirements and ethical standards, to maintain and increase knowledge of standards required of the financial services industry. Additionally, we provide employees various avenues to confidentially and anonymously report perceived unethical behavior without repercussions to them, such as FNB’s Ethics Hotline.
Employees complete quarterly and annual training, which include regulatory and compliance requirements and ethical standards, to maintain and increase knowledge of standards required of the financial services industry. Additionally, we provide employees various avenues to confidentially and anonymously report perceived unethical behavior without repercussions to them, such as FNB’s Ethics Hotline.
Under current FRB regulations, the acquisition of 10% or more (but less than 25%) of the voting stock of a 11 Table of Contents corporation would, under the circumstances set forth in the regulations, create a rebuttable presumption of acquisition of control of the corporation.
Under current FRB regulations, the acquisition of 10% or more (but less than 25%) of the voting stock of a corporation would, under the circumstances set forth in the regulations, create a rebuttable presumption of acquisition of control of the corporation.
The findings of the supervisory initiatives will be included in reports of examination. Deficiencies will be incorporated into the organization’s supervisory ratings, which can affect the organization’s ability to make acquisitions and take other actions.
The findings of the supervisory initiatives will be included in reports of examination. Deficiencies will be incorporated into the organization’s supervisory ratings, which can affect the organization’s ability to make acquisitions and 16 Table of Contents take other actions.
Information on our website is not incorporated by reference into this document and should not be considered part of this Report. Our common stock is traded on the NYSE under the symbol “FNB”. 18 Table of Contents
Information on our website is not incorporated by reference into this document and should not be considered part of this Report. Our common stock is traded on the NYSE under the symbol “FNB”.
For banks with less than $50 billion in total consolidated assets, such as FNBPA, the premium deduction is phased-out based on the proportion of the bank’s assets exceeding $10 billion.
For banks with less than $50 billion in total consolidated assets, the premium deduction is phased-out based on the proportion of the bank’s assets exceeding $10 billion.
Also, transactions between banks and their non-bank affiliates are required to be on arm's-length terms and consistent with safe and sound banking practices. Transactions with Insiders. Banks are subject to restrictions that limit their lending to insiders.
Also, transactions between banks and their non-bank affiliates are required to be on arm's-length terms and consistent with safe and sound banking practices. 12 Table of Contents Transactions with Insiders. Banks are subject to restrictions that limit their lending to insiders.
Human Capital We are committed to attracting, retaining and developing exceptional talent who reflect the communities we serve. FNB’s leadership team has made long-standing investments in a competitive compensation and benefits program that promotes work-life balance, financial and mental health, and overall well-being.
Human Capital We are committed to attracting, retaining and developing exceptional talent who reflect the communities we serve. FNB’s leadership team has made long-standing investments in maintaining a sustainable and resilient work force including providing a competitive compensation and benefits program that promotes work-life balance, financial and mental health, and overall well-being.
Commercial banking solutions include corporate banking, small business banking, investment real estate financing, business credit, capital markets and lease financing. Consumer banking products and services include deposit products, mortgage lending, consumer lending and a complete suite of mobile and online banking services.
Commercial banking solutions include corporate banking, treasury management services, small business banking, investment real estate financing, business credit, capital markets and equipment financing. Consumer banking products and services include deposit products, mortgage lending, consumer lending and a complete suite of mobile and online banking services.
Our Wealth Management operations are conducted through three subsidiaries of FNBPA. FNTC provides a broad range of personal and corporate fiduciary services, including the administration of decedent and trust estates. As of December 31, 2024, the fair value of trust assets under management was approximately $9.5 billion.
Our Wealth Management operations are conducted through two subsidiaries of FNBPA. FNTC provides a broad range of personal and corporate fiduciary services, including the administration of decedent and trust estates. As of December 31, 2025, the fair value of trust assets under administration was approximately $14.9 billion.
Penn-Ohio is subject to examination by the Arizona Department of Insurance. Representatives of the Arizona Department of Insurance periodically determine whether Penn-Ohio has maintained required reserves, established adequate deposits under a reinsurance agreement and complied with reporting requirements under the applicable Arizona statutes.
Representatives of the Arizona Department of Insurance periodically determine whether Penn-Ohio has maintained required reserves, established adequate deposits under a reinsurance agreement and complied with reporting requirements under the applicable Arizona statutes.
In addition, these regulators must establish regulations or guidelines requiring enhanced disclosure to regulators of incentive-based compensation arrangements. In June 2010, the FRB and FDIC issued comprehensive final guidance on incentive compensation policies intended to ensure that the incentive compensation policies of banking organizations do not undermine the safety and soundness of such organizations by encouraging excessive risk-taking.
In addition, these regulators must establish regulations or guidelines requiring enhanced disclosure to regulators of incentive-based compensation arrangements. The federal banking agencies have issued comprehensive guidance on incentive compensation policies intended to ensure that the incentive compensation policies of banking organizations do not undermine the safety and soundness of such organizations by encouraging excessive risk-taking.
As of December 31, 2024, FNB and our subsidiaries had 4,104 full-time and 176 part-time employees. 6 Table of Contents Recruitment. We are committed to identifying and attracting the best qualified job candidates by cultivating and fostering mutually beneficial partnerships with job and recruiting centers, colleges and universities and other organizations.
As of December 31, 2025, FNB and our subsidiaries had 4,128 full-time and 154 part-time employees. Recruitment. We are committed to identifying and attracting the best qualified job candidates by cultivating and fostering mutually beneficial partnerships with job and recruiting centers, colleges and universities and other organizations.
This support may be required at times when the parent holding company may not be able to provide such support.
This support may be 11 Table of Contents required at times when the parent holding company may not be able to provide such support.
Certain financial information concerning these subsidiaries, along with the parent company and intercompany eliminations, are 5 Table of Contents included in the “Parent and Other” category in Note 24, “Business Segments” in the Notes to Consolidated Financial Statements, which is included in Item 8 of this Report.
Certain financial information concerning these subsidiaries, along with the parent company and intercompany eliminations, are included in the “Parent and Other” category in Note 24, “Business Segments” in the Notes to Consolidated Financial Statements, which is included in Item 8 of this Report. 5 Table of Contents Market Area and Competition We operate in seven states and the District of Columbia.
FNBPA has also agreed to spend approximately $1.75 million over the five-year period on community partnerships, advertising, community outreach and consumer education. FNBPA has also agreed to open three new branch offices in predominantly Black and Hispanic neighborhoods, with two in Charlotte and one in Winston Salem, North Carolina.
FNBPA has also agreed to spend approximately $1.75 million over the five-year period on community partnerships, advertising, community outreach and consumer education, of which, FNBPA has also agreed to open three new branch offices in predominantly Black and Hispanic neighborhoods, with two in Charlotte and one in Winston Salem, North Carolina (two opened in 2025 and the third branch will soon begin the construction phase).
We have incurred and may in the future incur additional costs in complying with the above-identified consumer requirements. In addition, there is continued uncertainty about the CFPB’s priorities and how they will change under the Trump Administration. For example, in February 2025, the Acting Director of the CFPB instructed agency staff to pause most activity, including supervision and enforcement.
We have incurred and may in the future incur additional costs in complying with the above-identified consumer requirements. In addition, there is continued uncertainty about the CFPB’s priorities under the current U.S. administration. For example, in February 2025, the Acting Director of the CFPB instructed agency staff to pause most activity, including supervision and 14 Table of Contents enforcement.
Market Area and Competition We operate 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.
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 2024, we received more than 80 awards recognizing our financial performance, outstanding culture, community commitments, leadership and innovative technology, including national, regional and industry-specific recognition from Energage, an independent research firm, based entirely on feedback from our own team.
In 2025, we received more than 80 awards recognizing our financial performance, exceptional workplace, culture, community commitments, strong leadership and innovative banking approach, including national, regional and industry-specific recognition from Energage, an independent research firm, based entirely on feedback from our own team.
We demonstrate this commitment to each group through varying initiatives and procedures to ensure that employees and customers alike leave our spaces as safely as they came. We provide our employees detailed information and training explaining the safety features of our locations, evacuation routes and emergency procedures processes.
We demonstrate this commitment to each group through varying initiatives and procedures to ensure that employees and customers alike experience safe surroundings. We provide our employees detailed information and training explaining the safety features of our locations, evacuation routes and emergency procedures processes.
Assessment rates, which declined for all banks when the reserve ratio first surpassed 1.15% in the third quarter of 2016, increased for all insurance depository institutions by 2 basis points in the first quarter of 2023.
Assessment rates, which declined for all banks when the reserve ratio first surpassed 1.15% in the third quarter of 2016, increased for all insurance depository institutions by 2 basis points in the first quarter of 2023. Assessment rates will remain in effect unless and until the reserve ratio meets or exceeds 2%.
FNTC is required to maintain certain minimum capitalization levels in accordance with regulatory requirements. FNTC periodically measures its capital position to ensure all minimum capitalization levels are maintained. Our Wealth Management segment also includes two other subsidiaries.
FNTC is required to maintain certain minimum capitalization levels in accordance with regulatory requirements. FNTC periodically measures its capital position to ensure all minimum capitalization levels are maintained.
As of December 31, 2024, we have 349 Community Banking branches in Pennsylvania, Ohio, Maryland, West Virginia, North Carolina, South Carolina, Washington, D.C. and Virginia. As of December 31, 2024, we had total assets of nearly $49 billion, loans of $34 billion and deposits of $37 billion.
As of December 31, 2025, we have 355 Community Banking branches in Pennsylvania, Ohio, Maryland, West Virginia, North Carolina, South Carolina, Washington, D.C. and Virginia. As of December 31, 2025, we had total assets of $50 billion, loans of $35 billion and deposits of $39 billion.
Through our comprehensive approach, we have created an inclusive environment that fosters collaboration, innovation and a passion to win, all of which translate to strong performance and a rewarding employee experience.
Through our comprehensive approach, we have created a collaborative environment that fosters talent, opportunity, innovation and a passion to win, all of which translate to strong performance and a rewarding and opportunistic experience for all employees.
The financial services industry is subject to extensive regulatory oversight and, in particular, bank holding companies, banks and their affiliates (depending upon charter and business activities) are subject to supervision, regulation and examination by the FRB, OCC, FDIC, CFPB, SEC, FINRA and various state regulatory agencies. Also, FNB is subject to the rules of the NYSE for listed companies.
Dutey 52 Corporate Controller and Principal Accounting Officer Government Supervision and Regulation The financial services industry is subject to extensive regulatory oversight and, in particular, bank holding companies, banks and their affiliates (depending upon charter and business activities) are subject to supervision, regulation and examination by the FRB, OCC, FDIC, CFPB, SEC, Financial Industry Regulatory Authority (FINRA) and various state regulatory agencies.
The comprehensive package includes robust development resources that encourage advancement and increased representation at all levels of the Company, furthering our strategic focus on building and sustaining a strong workforce.
The comprehensive package includes robust development resources promoting a culture of belonging that encourages and provides opportunity and advancement for all employees at all levels of the company, furthering our strategic focus on building and sustaining a strong workforce.
The BHC Act further requires the FRB to consider the competitive impact of the transaction, the financial and managerial resources and future prospects of the bank holding companies and banks concerned and the convenience and needs of the community to be served, including the applicant’s record of performance under the CRA.
The BHC Act further requires the FRB to consider the competitive impact of the transaction, the extent to which the transaction would result in greater or more concentrated risks to the stability of the U.S. banking or financial system, the financial and managerial resources and future prospects of the bank holding companies and banks concerned and the convenience and needs of the community to be served, including the applicant’s record of performance under the CRA.
Delie, Jr. 60 Chairman, President and Chief Executive Officer Vincent J. Calabrese, Jr. 62 Chief Financial Officer Gary L. Guerrieri 64 Chief Credit Officer David B. Mitchell, II 67 Chief Wholesale Banking Officer Barry C. Robinson 61 Chief Consumer Banking Officer James G. Orie 66 Chief Legal Officer and Corporate Secretary James L.
Delie, Jr. 61 Chairman, President and Chief Executive Officer Vincent J. Calabrese, Jr. 63 Chief Financial Officer Gary L. Guerrieri 65 Chief Credit Officer David B. Mitchell, II 68 Chief Wholesale Banking Officer Alfred D. Cho 48 Chief Consumer Banking Officer James G. Orie 67 Chief Legal Officer and Corporate Secretary James L.
The special assessment rate was 13.44 basis points and will be paid over eight initial quarters beginning in June 2024. FNBPA recognized the entire initial special assessment expense of $29.9 million in the fourth quarter of 2023. The special assessment is not considered an FDIC premium under the TCJA and therefore is tax deductible for federal income tax purposes.
The special assessment rate was 13.44 basis points and will be paid over eight initial quarters beginning in June 2024. FNBPA recognized the entire initial special assessment expense of $29.9 million in the fourth quarter of 2023.
Congress, state legislatures and federal and state regulatory agencies. In addition to laws and regulations, state and federal bank regulatory agencies may issue policy statements, interpretive letters and similar written guidance, which sometimes materially changes regulatory expectations.
Political, economic, and industry events and other factors may influence changes to the banking laws, regulations and policies by the U.S. Congress, state legislatures and federal and state regulatory agencies. In addition to laws and regulations, state and federal bank regulatory agencies may issue policy statements, interpretive letters and similar written guidance, which sometimes materially changes regulatory expectations.
The Wealth Management segment consists of a federally chartered trust company, a registered investment advisor and a subsidiary that offers broker-dealer services through a third-party networking arrangement with a non-affiliated licensed broker-dealer entity. The Insurance segment consists of an insurance agency and a reinsurer. Community Banking Our Community Banking segment consists of FNBPA, which offers commercial and consumer banking services.
The Wealth Management segment consists of a federally chartered trust company and a subsidiary that offers broker-dealer services through a third-party networking arrangement with a non-affiliated licensed broker-dealer entity.
Office of Foreign Assets Control Regulation The U.S. has instituted economic sanctions which affect transactions with designated foreign countries, nationals and others. These are sometimes known as the “OFAC rules” because they are administered by the UST Office of Foreign Assets Control (OFAC). The OFAC-administered sanctions target countries in various ways.
These are sometimes known as the “OFAC rules” because they are administered by the UST Office of Foreign Assets Control (OFAC). The OFAC-administered sanctions target countries and territories in various ways.
Specifically, pursuant to the settlement agreement, FNBPA will invest a minimum of $11.75 million in a mortgage loan subsidy fund over a five-year period, leveraging its previously announced commitment to underserved communities across its footprint, including those located in the Charlotte and Winston-Salem markets.
Specifically, leveraging its previously announced and longstanding commitment to underserved communities across its footprint (including Charlotte and Winston Salem North Carolina), FNBPA entered into settlement agreements with the DOJ and the North Carolina DOJ whereby it committed to invest a minimum of $11.75 million in a mortgage loan subsidy fund over a five-year period ending in 2029.
These laws and regulations are primarily for the protection of policyholders. In all jurisdictions, the applicable laws and regulations are subject to amendment or interpretation by regulatory authorities. Generally, those authorities are vested with relatively broad discretion to grant, renew and revoke licenses and approvals and to implement regulations.
In all jurisdictions, the applicable laws and regulations are subject to amendment or interpretation by regulatory authorities. Generally, those authorities are vested with relatively broad discretion to grant, renew and revoke licenses and approvals and to implement regulations. Licenses may be denied or revoked for various reasons, including for regulatory violations or upon conviction for certain crimes.
In addition, a bank holding company’s operating entities, including its subsidiary broker-dealers, investment managers, investment advisory companies, insurance companies and banks, as applicable, are subject to the jurisdiction of various federal and state “functional” regulators and self-regulatory organizations, such as FINRA.
In addition, a bank holding company’s operating entities, including its subsidiary broker-dealers, investment managers, investment advisory companies, insurance companies and banks, as applicable, are subject to the jurisdiction of various federal and state “functional” regulators and self-regulatory organizations, such as FINRA. 8 Table of Contents Our subsidiary bank, FNBPA, and FNBPA’s subsidiary trust company, FNTC, are organized as national banking associations, which are subject to regulation, supervision and examination by the OCC, which is a bureau of the UST.
Noncompliance with the Investment Advisers Act or other federal and state securities laws and regulations could result in investigations, sanctions, disgorgement, fines and reputation damage. Standard of Care Pursuant to the Dodd-Frank Act, the SEC adopted a package of rule-makings and interpretations related to the provision of advice by broker-dealers and investment advisers, including Regulation Best Interest and Form CRS.
Standard of Care Pursuant to the Dodd-Frank Act, the SEC adopted a package of rule-makings and interpretations related to the provision of advice by broker-dealers and investment advisers, including Regulation Best Interest and Form CRS.
Compared to the 1995 Bank Merger Guidelines, the 2023 Merger Guidelines set forth more stringent concentration limits and add several largely qualitative bases on which the DOJ may challenge a merger.
Compared to the 1995 Bank Merger Guidelines, the 2023 Merger Guidelines set forth more stringent concentration limits and add several largely qualitative bases on which the DOJ may challenge a merger. However, on May 8, 2025, the OCC rescinded the Policy Statement and reinstated its expedited processing procedures for streamlined business combinations.
Any change in the statutes, regulations or regulatory policies applicable to us, including changes in their interpretation, expectations or implementation, could have a material effect on our business or organization. (See discussion under Risk Factors - caption “We could be adversely affected by changes in the law, especially changes in the regulation of the banking industry”).
Any change in the statutes, regulations or regulatory policies applicable to us, including changes in their interpretation, expectations or implementation, could have a material effect on our business or organization.
Various states have also proposed, or adopted, laws and regulations seeking to impose new standards of conduct on broker-dealers that may differ from the SEC's regulations, which may lead to additional implementation costs. In April 2024, the Department of Labor (DOL) issued a final rule significantly expanding the definition of “investment advice fiduciary” under ERISA, as amended.
Various states have also proposed, or adopted, laws and regulations seeking to impose new standards of conduct on broker-dealers that may differ from the SEC's regulations, which may lead to additional implementation costs.
The statutory and regulatory framework that governs FNB and our affiliates is generally intended to protect depositors and customers, the federal DIF, the U.S. banking and financial system, and financial markets as a whole, rather than our shareholders. Political, economic, and industry events and other factors may influence changes to the banking laws, regulations and policies by the U.S.
Also, FNB is subject to the rules of the NYSE for listed companies. The statutory and regulatory framework that governs FNB and our affiliates is generally intended to protect depositors and customers, the federal DIF, the U.S. banking and financial system, and financial markets as a whole, rather than our shareholders.
First National Investment Services Company, LLC offers a broad array of investment products and services for customers of the Wealth Management segment through a networking relationship with a third-party licensed brokerage firm. FNBIA, an investment advisor registered with the SEC, offers customers of the Wealth Management segment comprehensive investment programs featuring mutual funds, annuities, stocks and bonds.
Our Wealth Management segment also includes another subsidiary, First National Investment Services Company, LLC, which offers a broad array of investment products and services for customers of the Wealth Management segment through a networking relationship with a third-party licensed brokerage firm.
In addition, in July 2023, the SEC issued a final rule that requires disclosure of material cybersecurity incidents, as well as cybersecurity risk management, strategy and governance. Anti-Money Laundering Initiatives and the USA PATRIOT Act A major focus of governmental policy on financial institutions in recent years has been aimed at combating money laundering and terrorist financing.
Anti-Money Laundering Initiatives and the USA PATRIOT Act A major focus of governmental policy on financial institutions in recent years has been aimed at combating money laundering and terrorist financing.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese provisions of our Articles of Incorporation and By-laws and of Pennsylvania law could discourage potential acquisition proposals and could delay or prevent a change in control, even though the holders of a majority of our stock may consider such proposals desirable.
Biggest changeThe voting requirement is also inapplicable where the affiliated transaction satisfies specified "fair price" and procedural protections, including payment of consideration meeting minimum value standards, use of cash or matching consideration previously paid by the interested shareholder, maintenance of regular dividend practices, restrictions on additional acquisitions of voting share by the interested shareholder, the distribution of a proxy or information statement at least 25 days prior to consummation of the transaction unless otherwise approved by a majority of the disinterested directors, and affiliated transactions wherein the interested shareholder became an interested shareholder inadvertently. 29 Table of Contents These provisions of our Articles of Incorporation and By-laws and of Pennsylvania law could discourage potential acquisition proposals and could delay or prevent a change in control, even though the holders of a majority of our stock may consider such proposals desirable.
The Consent Orders will be in effect for a minimum of five years, which term could be longer depending upon the extent and timing of the requisite loan subsidies that will be paid by FNBPA to qualified applicants. Accordingly, our ability to pursue strategic growth initiatives involving combinations with other banking organizations may be substantially limited.
The Consent Orders will be in effect for a minimum of five years, which term could be longer depending upon the extent and timing of the requisite loan subsidies that will be paid by FNBPA to qualified applicants. Accordingly, our ability to pursue strategic growth initiatives involving combinations with other banking organizations may be limited.
Conditions such as changes in interest rates, money supply, levels of employment and other factors beyond our control may have a negative impact on economic activity. Any contraction of economic activity, including an economic recession or an inflationary environment, may adversely affect our asset quality, deposit levels and loan demand and, therefore, our earnings.
Conditions such as changes in interest rates, money supply, levels of employment and other factors beyond our control may have a negative impact on economic activity. Any contraction of economic activity, including an economic downturn or recession or an inflationary environment, may adversely affect our asset quality, deposit levels and loan demand and, therefore, our earnings.
Operational Risk Our failure to continue to recruit and retain qualified banking professionals could adversely affect our ability to compete successfully and affect our profitability. Our continued success and future growth depend heavily on our ability to attract and retain highly skilled, diverse and motivated banking professionals.
Operational Risk Our failure to continue to recruit and retain qualified banking professionals could adversely affect our ability to compete successfully and affect our profitability. Our continued success and future growth depend heavily on our ability to attract and retain highly skilled and motivated banking professionals.
In response to several large bank failures in the spring of 2023, the federal banking agencies have engaged in rulemaking that could increase compliance costs should we grow in excess of $50 billion in assets, including the FDIC adopting resolution planning requirements for IDIs with $50 billion or more in assets.
In response to several large bank failures in the spring of 2023, the federal banking agencies have engaged in rulemaking that could increase compliance costs should we grow in excess of $50 billion in average total assets, including the FDIC adopting resolution planning requirements for IDIs with $50 billion or more in average total assets.
In any case, credit performance over the medium-and long-term is susceptible to economic and market forces and therefore forecasts remain uncertain, with some degree of instability in the CRE markets expected in the coming quarters as loans are refinanced in markets with higher vacancy rates under current economic conditions.
Credit performance over the medium-and long-term is susceptible to economic and market forces and therefore forecasts remain uncertain, with some degree of instability in the CRE markets expected in the coming quarters as loans are refinanced in markets with higher vacancy rates under current economic conditions.
To date, these efforts have been carried out through a mix of executive actions aimed at eliminating or modifying federal agency and federal program funding, reducing the size of the federal workforce, reducing or altering the scope of activities conducted by, and possibly eliminating, various federal agencies and bureaus, and encouraging the use of artificial intelligence and other advanced technologies within the public and private sectors.
To date, these efforts have been carried out through a mix of executive actions aimed at eliminating or modifying federal agency and federal program funding, reducing the size of the federal workforce, reducing or altering the scope of activities conducted by, and possibly eliminating, various federal agencies and bureaus, and encouraging the use of AI and other advanced technologies within the public and private sectors.
Determination of the allowance is inherently subjective and is based on factors that are susceptible to significant change. Continuing deterioration in economic conditions affecting borrowers, new information regarding existing loans, suspected fraud, identification of additional problem loans and other factors, both within and outside of our control, may require an increase in the ACL.
Determination of the allowance is inherently subjective and is based on factors that are susceptible to significant change. Continuing deterioration in economic conditions affecting borrowers, new information regarding existing loans, suspected fraud, identification of additional problem loans and other factors, both within and outside of our control, may require an 19 Table of Contents increase in the ACL.
Increases or decreases in market interest rates are expected to further increase or decrease our AOCI (loss) and thereby decrease or increase shareholders’ equity. Further, the FRB and the OCC may consider increases in AOCI when evaluating our regulatory capital position, although current capital regulations permit AOCI to be excluded from capital for institutions of our size. 3.
Increases or decreases in market interest rates are expected to further increase or decrease our AOCI (loss) and thereby decrease or increase shareholders’ equity. 20 Table of Contents Further, the FRB and the OCC may consider increases in AOCI when evaluating our regulatory capital position, although current capital regulations permit AOCI to be excluded from capital for institutions of our size. 3.
Our ability to analyze the risks presented by prospective acquisitions, as well as our 26 Table of Contents ability to prepare in advance of closing for integration, may be limited to the extent that we cannot gather necessary or desirable information with respect to the business we are acquiring.
Our ability to analyze the risks presented by prospective acquisitions, as well as our ability to prepare in advance of closing for integration, may be limited to the extent that we cannot gather necessary or desirable information with respect to the business we are acquiring.
Changes in regulatory rules or standards or the application of those rules or standards, or future regulatory initiatives designed to mitigate risk or promote competition may also limit our ability to complete an acquisition (see discussion under Government Supervision and Regulation, Expansion and Acquisitions).
Changes in regulatory rules or standards or the application of those rules or standards, or future regulatory initiatives designed to mitigate risk or promote competition may also limit our ability to complete an acquisition (see discussion in Part I, Business under Government Supervision and Regulation, Expansion and Acquisitions).
Earnings could also be adversely affected if the interest rates received on loans and other 20 Table of Contents investments fall more quickly than the interest rates paid on deposits and other borrowings. A reduction in interest rates could result in unanticipated or adverse changes in depositor behavior, which could negatively affect our broader asset and liability management strategy.
Earnings could also be adversely affected if the interest rates received on loans and other investments fall more quickly than the interest rates paid on deposits and other borrowings. A reduction in interest rates could result in unanticipated or adverse changes in depositor behavior, which could negatively affect our broader asset and liability management strategy.
Moreover, obtaining adequate funding to meet our deposit obligations may be more challenging during periods of elevated prevailing interest rates, such as the present period. Our ability to attract depositors during a time of actual or perceived distress or instability in the marketplace may be limited. Further, interest rates paid for borrowings generally exceed the interest rates paid on deposits.
Moreover, obtaining adequate funding to meet our deposit obligations may be more challenging during periods of elevated prevailing interest rates. Our ability to attract depositors during a time of actual or perceived distress or instability in the marketplace may be limited. Further, interest rates paid for borrowings generally exceed the interest rates paid on deposits.
Certain provisions of our Articles of Incorporation and By-laws and Pennsylvania law may discourage takeovers. Our Articles of Incorporation and By-laws contain certain anti-takeover provisions that may discourage or may make more difficult or expensive a tender offer, change in control or takeover attempt that is opposed by our Board of Directors.
Our Articles of Incorporation and By-laws contain certain anti-takeover provisions that may discourage or may make more difficult or expensive a tender offer, change in control or takeover attempt that is opposed by our Board of Directors.
In particular, interest rates are highly sensitive to many factors that are beyond our control, including global, domestic and local economic conditions and the policies of various governmental and regulatory agencies and, specifically, the FRB.
In particular, interest rates are highly sensitive to many factors that are 23 Table of Contents beyond our control, including global, domestic and local economic conditions and the policies of various governmental and regulatory agencies and, specifically, the FRB.
While we have policies, procedures and practices designed to prevent or limit the effect of the failure, interruption, or security breach of our communications and information systems, we cannot completely ensure that any such failures, interruptions, or security breaches will not occur or, if they do occur, that they will be adequately addressed.
While we have policies, procedures and practices designed to prevent or limit the effect of the failure, interruption, or security breach of our communications and 25 Table of Contents information systems, we cannot ensure that any such failures, interruptions, or security breaches will not occur or, if they do occur, that they will be adequately addressed.
This discussion is intended to highlight risks that we believe are important factors to consider when evaluating our business and an investment in our securities. Additional risks and uncertainties not presently known or that we currently believe to be immaterial may also adversely affect our business. 1.
This discussion is intended to highlight risks that we believe are important factors to consider when evaluating 18 Table of Contents our business and an investment in our securities. Additional risks and uncertainties not presently known or that we currently believe to be immaterial may also adversely affect our business. 1.
During periods of reduced loan demand, our results of operations may be adversely affected to the extent that we are unable to reduce expenses commensurate with the decline in loan originations. • Future changes to our eligibility to participate in the programs offered by the government-sponsored enterprises (GSEs) and other secondary purchasers, or the loan criteria of the GSEs and other secondary purchasers could also result in a lower volume of corresponding loan originations and sales. 19 Table of Contents • The estimates of revenues produced by the models we use to assess the impact of interest rates on mortgage-related revenues are dependent on estimates and assumptions of future loan demand, prepayment speeds and other factors which may differ from actual subsequent experience.
During periods of reduced loan demand, our results of operations may be adversely affected to the extent that we are unable to reduce expenses commensurate with the decline in loan originations. • Future changes to our eligibility to participate in the programs offered by the GSE and other secondary purchasers, or the loan criteria of the GSE and other secondary purchasers could also result in a lower volume of corresponding loan originations and sales. • The estimates of revenues produced by the models we use to assess the impact of interest rates on mortgage-related revenues are dependent on estimates and assumptions of future loan demand, prepayment speeds and other factors which may differ from actual subsequent experience.
The Trump Administration has commenced efforts to implement significant changes to the size and scope of the federal government and reform its operations to achieve stated goals that include reducing the federal budget deficit and national debt, improving the efficiency of government operations, and promoting innovation and economic growth.
The current U.S. administration has commenced efforts to implement significant changes to the size and scope of the federal government and reform its operations to achieve stated goals that include reducing the federal budget deficit and national debt, improving the efficiency of government operations, and promoting innovation and economic growth.
The losses incurred by the DIF in connection with the resolution of SIVB and SBNY are required by law to be recovered through one or more special assessments on depository institutions and, potentially, their holding companies if the FDIC determines such action to be appropriate and the Secretary of the UST concurs with the FDIC’s determination.
The losses incurred by the DIF in connection with the resolution of large bank failures are required by law to be recovered through one or more special assessments on depository institutions and, potentially, their holding companies if the FDIC determines such action to be appropriate and the Secretary of the UST concurs with the FDIC’s determination.
Many of these types of transactions expose FNB, FNBPA and our affiliates to credit risk in the event of default of the 23 Table of Contents counterparty or client.
Many of these types of transactions expose FNB, FNBPA and our affiliates to credit risk in the event of default of the counterparty or client.
It is possible that such comprehensive changes to the federal government may be materially adverse to the regional and local economies where we conduct business and to our customers, which could be materially adverse to our business, financial condition and results of operations. 7.
It is possible that such comprehensive changes to the federal government or federal government shutdowns may be materially adverse to the regional and local economies where we conduct business and to our customers, which could be materially adverse to our business, financial condition and results of operations. 31 Table of Contents 7.
Changes in interest rates could reduce the value of our AFS securities holdings which would increase our accumulated other comprehensive loss and thereby negatively impact shareholders’ equity. We maintain an investment portfolio consisting of various high-quality liquid fixed-income securities.
Changes in interest rates could reduce the value of our AFS securities holdings which would increase our accumulated other comprehensive loss and thereby negatively impact shareholders’ equity. We maintain an investment portfolio consisting of various high-quality liquid fixed-income securities. The nature of fixed-income securities is such that changes in market interest rates impact the value of these assets.
In many instances, depositors moved these funds into money market mutual funds or other similar securities accounts in an effort to diversify the risk of further bank failure(s). Uninsured deposits historically have been viewed by the FDIC as less stable than insured deposits.
In many instances, this has resulted in depositors moving these funds into money market mutual funds or other similar securities accounts in an effort to diversify the risk of potential bank failure(s). Uninsured deposits historically have been viewed by the FDIC as less stable than insured deposits.
It is possible that we could have exposure to liability and suffer losses as a result of a security breach or cyber-attack that occurred through no fault of ours. Although we maintain specific “cyber” insurance coverage, the amount or form of coverage may not be adequate in any particular case.
It is possible that we could have exposure to liability and suffer losses as a result of a security breach or cyber-attack that occurred through systems that are not controlled by us. Although we maintain specific “cyber” insurance coverage, the amount or form of coverage may not be adequate in any particular case.
Further, a substantial reduction of the federal workforce could adversely affect regional and local economies, both directly and indirectly, in geographies with significant concentrations of federal employees and contractors.
Further, a substantial reduction of the federal workforce or a prolonged federal government shutdown could adversely affect regional and local economies, both directly and indirectly, particularly in geographies with significant concentrations of federal employees and contractors.
The monetary, tax and other policies of the U.S. Government and its agencies also have a significant impact on interest rates and overall financial market performance. The FRB regulates the national supply of bank credit and certain interest rates through the implementation of certain monetary policies and actions.
The monetary, tax and other policies of the U.S. Government and its agencies also have a significant impact on interest rates and overall financial market performance. The FRB regulates the national supply of bank credit and certain interest rates through the implementation of certain monetary policies and actions. The timing, extent, and frequency of interest rate changes is uncertain.
Our current facilities and systems, as well as those of our third-party service providers, may be vulnerable to security breaches, acts of vandalism and other physical security threats, computer viruses or compromises, ransomware attacks, misplaced or lost data, programming and/or human errors or other similar events.
Our current facilities and systems, as well as those of our third-party service providers, may be vulnerable to security breaches, acts of vandalism and other physical security threats, computer viruses or compromises, ransomware attacks, social engineering attacks, misplaced or lost data, programming and/or human errors or other similar events, any of which could be enhanced or facilitated by AI.
In particular, consistent with Pennsylvania law, our Articles of Incorporation and By-laws: • require shareholders to give us advance notice to nominate candidates for election to our Board of Directors or to solicit proxies in support of such candidates, or to make shareholder proposals at a shareholders’ meeting; • permit our Board of Directors to issue, without approval of our common shareholders unless otherwise required by law, preferred stock with such terms as our Board of Directors may determine; • provide that a special meeting may only be called by shareholders holding not less than 25% of all votes entitled to be cast at the proposed special meeting; • require the vote of the holders of at least 75% of our voting shares for shareholder amendments to our By-laws; and • in the case of a proposed business combination with a shareholder owning 10% or more of the voting shares of FNB, the vote of the holders of at least two-thirds of the voting shares not owned by such shareholder is required to approve the business combination, unless it is approved by a majority of FNB’s disinterested directors.
In particular, consistent with Pennsylvania law, our Articles of Incorporation and By-laws: • require shareholders to give us advance notice to nominate candidates for election to our Board of Directors or to solicit proxies in support of such candidates, or to make shareholder proposals at a shareholders’ meeting; • permit our Board of Directors to issue, without approval of our common shareholders unless otherwise required by law, preferred stock with such terms as our Board of Directors may determine; • provide that a special meeting may only be called by shareholders holding not less than 25% of all votes entitled to be cast on each issue at the proposed special meeting; and • require the vote of the holders of at least 75% of our voting shares for shareholder amendments to our By-laws.
Please refer to Item 1 – “Business – Human Capital.” Navigating varying expectations of policymakers and other stakeholders has inherent costs, and any failure to successfully navigate such expectations may expose us to negative publicity, shareholder activism, and litigation or other engagement from pro- and anti-ESG/DEI stakeholders, as well as the potential for civil investigations and enforcement by federal governmental authorities.
Please refer to Item 1 – “Business – Human Capital.” Navigating varying expectations of federal government policymakers and our various stakeholders expose us to potential inherent costs, and any failure to successfully navigate such expectations may expose us to negative publicity, shareholder activism, and litigation or other engagement from stakeholders who have differing viewpoints, as well as the potential for civil investigations and enforcement by federal governmental authorities.
In addition to the potential for broader "anti-ESG/DEI" policies and laws, on January 20, 2025, President Trump issued an Executive Order requiring all federal agencies to terminate any policies, programs, mandates, guidance, regulations, and other actions and orders establishing DEI-based preferences, and to enforce federal civil rights laws to combat such preferences, mandates, policies, programs and activities of entities operating in the private sector.
On January 20, 2025, the U.S. administration issued an Executive Order requiring all federal agencies to terminate any policies, programs, mandates, guidance, regulations, and other actions and orders establishing DEI-based preferences, and to enforce federal civil rights laws to combat such preferences, mandates, policies, programs and activities of entities operating in the private sector.
Challenging macroeconomic, recessionary and employment conditions in the market areas we serve could result in the following consequences, among others, any of which could have a material adverse effect on our business, financial condition and results of operations: demand for our loans, deposits and services may decline; loan delinquencies, problem assets, foreclosures and charge-offs may increase; weak economic conditions could limit the demand for loans by creditworthy borrowers, limiting our capacity to leverage our retail deposits and maintain our net interest income; collateral for our loans may decline in value; and the amount of our low-cost or non-interest-bearing deposits may decrease. 24 Table of Contents The banking and financial services industry continually encounters technological change, especially in the systems that are used to deliver products to, and execute transactions on behalf of, customers.
Challenging macroeconomic, recessionary and employment conditions in the market areas we serve could result in the following consequences, among others, any of which could have a material adverse effect on our business, financial condition and results of operations: demand for our loans, deposits and services may decline; loan delinquencies, problem assets, foreclosures and charge-offs may increase; weak economic conditions could limit the demand for loans by creditworthy borrowers, limiting our capacity to leverage our retail deposits and maintain our net interest income; collateral for our loans may decline in value; and the amount of our low-cost or non-interest-bearing deposits may decrease.
Even if a weather event does not cause any physical damage in our markets, it could affect the market value of property within our footprint, particularly agricultural interests, which are highly sensitive to excessive rainfall or droughts. We grow our business in part by acquiring other banks and financial services businesses from time to time.
Even if a weather event does not cause any physical damage in our markets, it could affect the market value of property within our footprint. We grow our business in part by acquiring other banks and financial services businesses from time to time.
As such, we may be forced to delay raising capital, issue shorter-term securities than desired or bear an unattractive cost of capital, which could decrease profitability, significantly reduce financial flexibility and adversely affect our ability to grow organically or through acquisitions.
As such, we may be forced to delay raising capital, issue shorter-term securities than desired or bear an unattractive cost of capital, which could decrease profitability, significantly reduce financial flexibility and adversely affect our ability to grow organically or through acquisitions. In addition, if we decide to raise additional equity capital, it could be dilutive to our existing shareholders. 4.
Poorly designed or implemented models, present the risk that our business decisions based on information incorporating models, will be adversely affected due to the inadequacy of such information. Also, information we provide to the public or to our regulators based on poorly designed or implemented models could be inaccurate or misleading.
Poorly designed or implemented models present the risk that our business decisions based on information incorporating models will be adversely affected due to the inadequacy of such information.
Changes in regulations or the regulatory environment could adversely affect the banking and financial services industry as a whole and could limit our growth and returns to investors by restricting such activities as the payment of dividends and stock repurchases, balance sheet growth, investments, loans and interest rates, assessments of fees, such as overdraft and interchange fees, the provision of securities, insurance, brokerage or trust services, mergers with or acquisitions of other institutions or branches, the types of deposit and non-deposit activities in which our subsidiaries may engage, and offering of new products and services.
Changes in regulations or the regulatory environment could adversely affect the banking and financial services industry as a whole and could limit our growth and returns to investors by restricting such activities as the payment of dividends and stock repurchases, balance sheet growth, investments, loans and interest rates, assessments of fees, such as overdraft and interchange fees, the provision of securities, insurance, brokerage or trust services, mergers with or acquisitions of other institutions or branches, the types of deposit and non-deposit activities in which our subsidiaries may engage, and offering of new products and services. 27 Table of Contents Under regulatory capital adequacy guidelines and other regulatory requirements, FNB and FNBPA must meet guidelines subject to qualitative judgments by regulators about components, risk weightings and other factors.
The fair lending laws prohibit discrimination in the provision of banking services on the basis of prohibited factors including, among others, race, color, national origin, gender, and religion. The enforcement of these laws has been an increasing focus for the CFPB and other regulators.
Our efforts to maintain a “Satisfactory” or better rating may increase our costs. The fair lending laws prohibit discrimination in the provision of banking services on the basis of prohibited factors including, among others, race, color, national origin, gender, and religion. The enforcement of these laws has been an increasing focus for the CFPB and other regulators.
Under federal law, the amount of dividends that a national bank, such as FNBPA, may pay in a calendar year is generally limited to the amount of our net income for the current year combined with our retained net income for the two preceding years. Likewise, our state incorporated entities are subject to state laws governing dividend practices and payments.
Under federal law, the amount of dividends that a national bank, such as FNBPA, may pay in a calendar year is generally limited to the amount of our net income for the current year combined with our retained net income for the two preceding years.
Depending on enactment dates, these law changes may be retroactive to previous periods which could negatively affect our current and future financial performance.
We are subject to legislative tax rate changes that could increase our effective tax rates. Depending on enactment dates, these law changes may be retroactive to previous periods which could negatively affect our current and future financial performance.
Significant changes to the size, structure, powers and operations of the federal government may cause economic disruptions that could adversely impact our business, results of operations and financial condition.
Changes in statutory tax rates or DTAs and DTLs may adversely affect our profitability and results of operations in future periods. Significant changes to the size, structure, powers and operations of the federal government may cause economic disruptions that could adversely impact our business, results of operations and financial condition.
The proportion of our deposit account balances that exceed FDIC insurance limits may expose FNBPA to enhanced liquidity risk in times of financial distress.
The proportion of our deposit account balances that exceed FDIC insurance limits may expose FNBPA to enhanced liquidity risk in times of financial distress. Bank failures can result from the sudden withdrawal of high volumes of deposits that exceed FDIC insured limits.
The process of eliminating banks as intermediaries, known as "disintermediation," could result in the loss of fee income, as well as the loss of customer deposits and the related income generated from those deposits.
The process of eliminating banks as intermediaries, known as "disintermediation," could result in the loss of fee income, as well as the loss of customer deposits and the related income generated from those deposits. On July 18, 2025, the Guiding and Establishing National Innovation for U.S.
We are subject to a variety of risks arising from environmental, social and governance (ESG) and diversity, equity and inclusion (DEI) matters, which include, among other things, climate change, human capital, and human rights. Risks arising from such matters may adversely affect, among other things, our reputation and the market price of our securities.
We are subject to a variety of risks arising from various Corporate Responsibility matters, which include, among other things, environmental sustainability, human capital and human resource practices, and human rights. Risks arising from such matters may adversely affect, among other things, our reputation and the market price of our securities.
Accordingly, digital asset service providers - which, at present are not subject to the same extensive regulation as banking organizations and other financial institutions - have become active competitors for our customers' banking business.
Certain characteristics of digital asset transactions, including their speed and anonymity are appealing to certain consumers notwithstanding the various risks posed by such transactions. Accordingly, digital asset service providers - which, at present are not subject to the same extensive regulation as banking organizations and other financial institutions - have become active competitors for our customers' banking business.
Although we monitor developments for areas of potential risk to our reputation and brand, negative perceptions or publicity could materially and adversely affect our revenues and profitability. Increasing, complex, evolving and conflicting regulatory, stakeholder, and other third-party expectations on ESG and DEI matters could adversely affect our reputation, our access to capital and the market price of our securities.
Although we monitor developments for areas of potential risk to our reputation and brand, negative perceptions or publicity could materially and adversely affect our revenues and profitability. 22 Table of Contents Increasing, complex, evolving and conflicting federal government policies, regulatory, stakeholder, and other third-party expectations on sustainability, human capital and social governance (Corporate Responsibility) practices could adversely affect our reputation, expose us to government investigations and enforcement actions, litigation and our access to capital and the market price of our securities.
Many of our larger competitors have greater resources to invest in technological improvements, and we may not effectively implement new technology-driven products and services or do so as quickly as our competitors. Failure to successfully keep pace with technological change affecting the banking and financial services industry could negatively affect our revenue and profitability.
Many of our larger competitors have greater resources to invest in technological improvements, and we may not effectively implement new technology-driven products and services or do so as quickly as our competitors.
The effective use of technology increases efficiency and enables financial institutions to better compete for and serve customers and reduce costs. Our future success will depend, in part, on our ability to address customer needs by using secure technology to provide products and services that will satisfy customer demands, as well as create additional efficiencies in our operations.
Our future success will depend, in part, on our ability to conveniently address customer needs by using secure technology to provide products and services that will satisfy customer demands, as well as create additional efficiencies in our operations.
Macroeconomic and geopolitical challenges and uncertainties affecting the stability of regions and countries around the globe could have a negative impact on our business, financial condition and results of operations.
Macroeconomic and geopolitical challenges and uncertainties affecting the stability of regions and countries around the globe could have a negative impact on our business, financial condition and results of operations. Existing and future geopolitical instability and related activities, such as U.S. and foreign tariff policies could adversely affect our businesses, financial condition and results of operations.
In addition to affecting the price and liquidity of U.S. government securities, a government default or threat of default could disrupt the market for or affect the pricing of repurchase agreements in U.S. government securities (Repos), a type of secured financing transaction used by many financial institutions, including FNBPA, to manage short-term funding needs, invest short-term cash balances and manage inventories of government securities.
A further downgrade, or a downgrade by other rating agencies, as well as sovereign debt issues facing the governments of other countries, could have a material adverse impact on financial markets and economic conditions in the U.S. and worldwide, which could adversely impact us. 28 Table of Contents In addition to affecting the price and liquidity of U.S. government securities, a government default or threat of default could disrupt the market for or affect the pricing of repurchase agreements in U.S. government securities (Repos), a type of secured financing transaction used by many financial institutions, including FNBPA, to manage short-term funding needs, invest short-term cash balances and manage inventories of government securities.
These third parties provide key components of our business operations such as data processing, recording and monitoring transactions, online banking interfaces and services, Internet connections and network access.
We rely on certain external vendors to provide products, information systems and services necessary, including our core processing system, to maintain our day-to-day operations. These third parties provide key components of our business operations such as data processing, recording and monitoring transactions, online banking interfaces and services, Internet connections and network access.
As cyber threats continue to 25 Table of Contents evolve and increase, we may be required to spend significant additional resources to continue to modify or enhance our protective and preventative measures or to investigate and remediate any information security vulnerabilities.
As cyber threats continue to evolve and increase, we may be required to spend significant additional resources to continue to modify or enhance our protective and preventative measures or to investigate and remediate any information security vulnerabilities. Our day-to-day operations rely heavily on the proper functioning of products, information systems and services provided by third-party vendors.
Among other things, the proposed rule would substantially change the existing calculation of risk-weighted assets and require banking organizations to use revised models for such calculations.
On July 27, 2023, the federal banking agencies, including the OCC, issued a proposed rule to implement the final components of the Basel III Capital Rules. Among other things, the proposed rule would substantially change the existing calculation of risk-weighted assets and require banking organizations to use revised models for such calculations.
The federal banking agencies, including the FDIC and OCC, issued an interagency policy statement in July 2023, noting that banks should maintain actionable contingency funding plans that take into account a range of possible stress scenarios, assess the stability of their funding and maintain a broad range of funding sources, ensure that collateral is available for borrowing, and review and revise contingency funding plans periodically and more frequently as market conditions and strategic initiatives change. 21 Table of Contents If a significant portion of our deposits were to be withdrawn within a short period of time such that additional sources of funding would be required to meet withdrawal demands, we may be unable to obtain funding at favorable terms, which may have an adverse effect on our net interest margin.
The federal banking agencies, including the FDIC and OCC, issued an interagency policy statement in July 2023, noting that banks should maintain actionable contingency funding plans that take into account a range of possible stress scenarios, assess the stability of their funding and maintain a broad range of funding sources, ensure that collateral is available for borrowing, and review and revise contingency funding plans periodically and more frequently as market conditions and strategic initiatives change.
Our asset valuations may include methodologies, estimations and assumptions that are subject to differing interpretations which, along with market factors such as volatility in one or more markets or industries, could result in changes to asset valuations that may materially adversely affect our results of operations or financial condition.
Certain decisions that regulators make, including those related to capital distributions and dividends to our shareholders, could be adversely affected due to the regulator’s perception that the quality of the models used to generate our relevant information is insufficient. 26 Table of Contents Our asset valuations may include methodologies, estimations and assumptions that are subject to differing interpretations which, along with market factors such as volatility in one or more markets or industries, could result in changes to asset valuations that may materially adversely affect our results of operations or financial condition.
We are subject to supervision and examination by U.S. government authorities and may become subject to investigations, enforcement actions, fines, and other adverse effects.
We are subject to supervision and examination by U.S. government authorities and may become subject to investigations, enforcement actions, fines, and other adverse effects. Our business operations are subject to extensive supervision, examination and regulation by a number of U.S. federal and state regulatory authorities, including the FRB, OCC and FDIC.
Moreover, stakeholder expectations are not uniform, and both opponents and proponents of various ESG- and DEI-related matters have increasingly resulted in a range of activism to advocate for their positions.
Moreover, stakeholder expectations are not uniform, and advocates with varying expectations on Corporate Responsibility matters have increasingly resulted in a range of activism to promote their positions.
If we fail to continue to invest in technological improvements as they become appropriate or necessary, our ability to compete effectively could be severely impaired. The banking and financial services industry continually undergoes technological changes, with frequent introductions of new technology-driven products and services, including recent and rapid developments in artificial intelligence.
The banking and financial services industry continually encounters technological change, especially in the systems that are used to deliver products to, and execute transactions on behalf of, customers. If we fail to continue to invest in technological improvements as they become appropriate or necessary, our ability to compete effectively could be severely impaired.
Regulatory authorities may restrict our ability to pay dividends on, and make repurchases of, our common stock.
Likewise, our state incorporated entities are subject to state laws governing dividend practices and payments. 21 Table of Contents Regulatory authorities may restrict our ability to pay dividends on, and make repurchases of, our common stock.
In addition, if we decide to raise additional equity capital, it could be dilutive to our existing shareholders. 22 Table of Contents 4. Reputation Risk Our key assets include our brand and reputation and our business may be affected by how we are perceived by the public. Our brand and our reputation are our key assets.
Reputation Risk Our key assets include our brand and reputation and our business may be affected by how we are perceived by the public. Our brand and our reputation are our key assets.
Changes resulting from these new standards may result in materially different financial results and may require that we change how we process, analyze and report financial information and that we change financial reporting controls. Our overdraft protection programs and corresponding revenue may be impacted by new federal regulatory requirements or scrutiny or industry trends regarding such practices.
Changes resulting from these new standards may result in materially different financial results and may require that we change how we process, analyze and report financial information and that we change financial reporting controls. Certain provisions of our Articles of Incorporation and By-laws and Pennsylvania law may discourage takeovers.
An adverse finding or outcome of any such review, examination, or investigation that involves an assertion of regulatory noncompliance, or a violation of law could result in possible fines, penalties, restitution, or other forms of remediation that could have a material adverse effect on our business, financial condition, results of operations, or reputation. 27 Table of Contents Fiscal challenges facing the U.S. government could negatively impact financial markets which in turn could have an adverse effect on our financial position or results of operations.
Fiscal challenges facing the U.S. government could negatively impact financial markets which in turn could have an adverse effect on our financial position or results of operations.
In the wake of the failures of Silicon Valley Bank (SIVB), Signature Bank (SBNY) and First Republic Bank (FRC), which the FDIC concluded were generated by, in significant part, a high volume of uninsured deposits, many large depositors across the industry have withdrawn deposits in excess of applicable deposit insurance limits and deposited these funds in other financial institutions.
As a result, many large depositors across the industry have withdrawn deposits in excess of applicable deposit insurance limits and deposited these funds in larger financial institutions they deem less likely to be affected by this condition.
Our financial condition and results of operations may be adversely affected by changes in federal, state or local tax rules and regulations, or interpretations. We are subject to legislative tax rate changes that could increase our effective tax rates.
In view of the OCC's reinstatement of the streamlined bank merger application and expedited review process, it is anticipated that future qualified bank acquisition transactions may be approved in a more expeditious and timely manner. Our financial condition and results of operations may be adversely affected by changes in federal, state or local tax rules and regulations, or interpretations.
In addition, transactions utilizing digital assets, including cryptocurrencies, stablecoins and other similar assets, have increased over the course of the last several years. Certain characteristics of digital asset transactions, including their speed and anonymity are appealing to certain consumers notwithstanding the various risks posed by such transactions.
Failure to successfully keep pace with technological change affecting the banking and financial services industry could negatively affect our revenue and profitability. 24 Table of Contents In addition, transactions utilizing digital assets, including cryptocurrencies, stablecoins and other similar assets, have increased over the course of the last several years.
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Due to elevated levels of inflation and corresponding pressure to raise interest rates, the FRB announced in January 2022 that it would be slowing the pace of its bond purchasing and increasing the target range for the federal funds rate over time, which it did from March 2022 to July 2023.
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If a significant portion of our deposits were to be withdrawn within a short period of time such that additional sources of funding would be required to meet withdrawal demands, we may be unable to obtain funding at favorable terms, which may have an adverse effect on our net interest margin.
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The FOMC began cutting the target federal funds rate in September 2024, most recently to a range of 4.25% to 4.50%, as announced in its FOMC policy statement issued on December 18, 2024. Economists are projecting that the target funds rate will likely decline further in small periodic increments, however the timing, extent, and frequency of such reductions remain uncertain.
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New appointments to the FRB, or increased political pressures on the FRB, could impact monetary policy, which will directly impact our liquidity, results of operations, financial condition and capital position.
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The total carrying value of the AFS securities portfolio as of December 31, 2024 was $3.5 billion with an estimated duration of approximately 2.9 years. The nature of fixed-income securities is such that changes in market interest rates impact the value of these assets.
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Global trade policies, including changing tariffs and the imposition of new or increased tariffs and related uncertainty thereof, could have a material adverse effect on our business, results of operations or financial condition.
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Based on the duration of our AFS securities portfolio, a one percent increase or decrease in market rates is projected to positively or negatively impact the market value of the AFS securities portfolio by approximately $100 million.
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There continues to be significant uncertainty about the future relationship between the U.S. and other countries, including with respect to trade policies, treaties, government regulations, sanctions, tariffs, and application thereof. For example, in April 2025, the U.S. government began imposing “reciprocal” tariffs intended to address trade deficits and inconsistent economic treatment of importation between the U.S. and other countries.
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According to the FRB’s November 2024 Financial Stability Report, aggregate commercial real estate (CRE) prices measured in inflation-adjusted terms were little changed over the prior six months of the report, with the pace of prior declines appearing to have slowed broadly across CRE sectors.
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In response, China, among others, has announced retaliatory tariffs against certain imports from the U.S., among other measures.
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This Financial Stability Report notes that these prices still may not fully reflect the deterioration in CRE market prices because, rather than realizing losses, many owners wait for more favorable conditions to put their properties on the market. The report also notes that the strains on the office sector resulting from an ongoing post-pandemic adjustment have continued to mount.
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Although we are continuing to evaluate the impact of these evolving developments, we cannot provide any assurance about the ultimate outcome or impact of these developments or other changes in trade policies, including the imposition or application of new or increased tariffs between the U.S. and other countries.
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However, the outlook for CRE remains dependent on the broader economic environment and, specifically, how major subsectors respond to a rising interest rate environment and higher prices for commodities, goods and services.
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Furthermore, changes to trade policies, retaliatory measures, or prolonged uncertainty in trade relationships could increase the cost of, and reduce demand for, our products and services, or customers’ ability to service debt, which would adversely impact our business.
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In addition, this Financial Stability Report notes that residential real estate values have continued to increase over the prior six months from the report from prices that were already elevated relative to historical standards. The report suggests that valuations in housing markets remained stretched.
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In addition, political tensions as a result of trade policies could reduce trade volume, investment and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets, which could adversely affect our business, results of operations and financial condition.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe CISO is supported by several managers including the following: • Manager of Cyber Security - CISSP with over 20 years of Information Technology and Systems Engineering experience. • Manager of Security Architecture - CISSP with over 20 years experience in Information Technology networking, network security and security engineering.
Biggest changeThe CISO is a Certified Information Systems Security Professional (CISSP), has a Bachelor’s degree in Criminal Justice with a minor in Computer Science and is supported by several managers including the following: • Director of Information Technology Risk and Compliance - CISSP with over 20 years of Information Technology, Data Center and Security Engineering experience. • Manager of Cyber Security - CISSP with over 20 years of Information Technology and Systems Engineering experience. • Manager of Security Architecture - CISSP with over 20 years of experience in Information Technology networking, network security and security engineering. • Manager of Security Access Management - A+, Network+ and Server+ certifications with over 20 years experience in Information Technology and Systems Administration.
The CISO chairs an Information Security Committee made up of other risk professionals, Information Technology and line of business leaders to maintain an understanding and balance between security and business functionality. A summary of the processes involved in our process of evaluating the effectiveness of information and cybersecurity controls is below. Risk Assessment Process .
The CISO chairs an Information Security Committee made up of other risk professionals, Information Technology and line of business leaders to maintain an understanding and balance between security and business functionality. A summary of our processes involved in evaluating the effectiveness of information and cybersecurity controls is below. Risk Assessment Process .
Access Management . Utilizing a least privilege, need-to-know access methodology, access is controlled through a centralized user access management function responsible for the provisioning, transfer and deprovisioning of users’ access. Access management also performs routine reviews of application and systems access to ensure access remains appropriate.
Utilizing a least privilege, need-to-know access methodology, access is controlled through a centralized user access management function responsible for the provisioning, transfer and deprovisioning of users’ access. Access management also performs routine reviews of application and systems access to ensure access remains appropriate.
The security of the FNB network infrastructure is maintained via: • internal and perimeter firewalls with intrusion detection, • the use of some network segmentation to isolate access to certain applications and systems, • VLANs or virtual local area networks, • email filtering to identify spam, malware, and phishing messages in received email messages, • malware detection, 33 Table of Contents • data loss prevention controls to prevent the theft, or mass exfiltration of data, • Virtual Private Networks to control remote access to our network, • intrusion detection capabilities, • network access controls to prevent unauthorized assets from connecting to the network, and • web filtering.
The security of the FNB network infrastructure is maintained via: • internal and perimeter firewalls with intrusion detection, • the use of some network segmentation to isolate access to certain applications and systems, • VLANs or virtual local area networks, • email filtering to identify spam, malware, and phishing messages in received email messages, • malware detection, • data loss prevention controls to prevent the theft, or mass exfiltration of data, • Virtual Private Networks to control remote access to our network, • intrusion detection capabilities, • network access controls to prevent unauthorized assets from connecting to the network, and • web filtering.
We believe our management has the appropriate expertise, background and depth of experience to manage risks arising from cybersecurity threats including applicable knowledge gained through industry experience, education, ongoing internal and external training and regular discussions with consultants and peers with applicable knowledge and expertise.
We believe our management has the appropriate expertise, background and depth of experience to manage risks arising from cybersecurity threats including applicable knowledge gained through industry experience, education, ongoing internal and external training and regular discussions with consultants and peers with applicable knowledge and expertise. See the following details of certain cybersecurity personnel.
On an annual basis, a risk assessment and maturity analysis is performed for the FNB environment based on the NIST CSF Framework. The risk assessment takes into consideration a combination of risks related to the identification, prevention, detection, response, and recovery from cyber events.
On an annual basis, a risk assessment and maturity analysis is performed for the FNB environment based on various frameworks such as CRI 2.0. FFIEC, CIS and NIST CSF. The risk assessment takes into consideration a combination of risks related to the identification, prevention, detection, response, and recovery from cyber events.
Third-party vendors are thoroughly vetted, approved and inventoried before partnership begins. To date, we have not experienced cybersecurity incidents that have materially affected our business strategy, results of operations or financial condition. For additional information regarding cybersecurity threats, see Item 1 of this Report, “Business – Cybersecurity” and Item 1A of this Report, “Risk Factors—5.
To date, we have not experienced cybersecurity incidents that have materially affected our business strategy, results of operations or financial condition. For additional information regarding cybersecurity threats, see Item 1 of this Report, “Business – Cybersecurity” and Item 1A of this Report, “Risk Factors—5.
Annual security training is conducted for all employees, and routine phishing tests are administered routinely. We also post articles regarding common cybersecurity schemes on our intranet for our employees’ awareness. We have a Vendor Management department that established policies and procedures to follow when utilizing third-party vendors and ensures that key risk components are mitigated based on our standards.
We also post articles regarding common cybersecurity schemes on our intranet for our employees’ awareness. 33 Table of Contents We have a Third-Party Risk Management department that established policies and procedures to follow when utilizing third-party vendors and ensures that key risk components are mitigated based on our standards. Third-party vendors are thoroughly vetted, approved and inventoried before partnership begins.
The penetration tests review our customer facing applications, our response to social engineering activities, overall external attack surface and internal vulnerabilities. Issues identified from the penetration tests are tracked and escalated to ensure appropriate remediation occurs before closure. Security Architecture .
The penetration tests review our customer-facing applications, our response to social engineering activities, overall external attack surface and internal vulnerabilities. Penetration test issues are prioritized by risk level and subject to ongoing tracking and escalation to ensure that remediation efforts are completed effectively and verified before closure. Security Architecture .
The risk assessment considers the inherent risk and controls implemented in the FNB environment and measures the residual risk to ensure it is within the FNB risk tolerance. Vulnerability Management Process . Regular internal and external vulnerability scanning is conducted at varying intervals to proactively identify configuration weaknesses, missing patches and other vulnerabilities in the FNB information systems environment.
The risk 32 Table of Contents assessment considers the inherent risk and controls implemented in the FNB environment and measures the residual risk to ensure it is within the FNB risk tolerance. Vulnerability Management Process .
Results of the information and cybersecurity evaluation and recommendations established by the Information Security Department are reported to the Risk Management Council no less than quarterly, and the results are then shared with the Board Risk Committee. The Board Risk Committee is primarily responsible for overseeing risk management, including risks associated with cybersecurity and potential threats thereto.
An Information Technology (IT) and Information Security Risk Assessment is conducted to identify further opportunities for improvement and are presented to Enterprise Risk Management and the Board Risk Committee. The Board Risk Committee is primarily responsible for overseeing risk management, including risks associated with cybersecurity and potential threats thereto.
See the following details of certain cybersecurity personnel. 32 Table of Contents The CISO has served FNB since 2016, and has a career over 25 years in information technology, enterprise risk and information security controls. The CISO is a Certified Information Systems Security Professional (CISSP). The CISO has a Bachelor’s degree in Criminal Justice with a minor in Computer Science.
The CISO has served FNB since 2016, and has a career over 25 years in information technology, enterprise risk and information security controls.
Identified vulnerabilities are classified and scored based on their Common Vulnerability Scoring System, known exploitation or malware impacting the vulnerability, and the age in the environment. We prioritize the patching of critical and severe vulnerabilities. Threat Management Process .
Regular internal and external vulnerability scanning is conducted at varying intervals to proactively identify configuration weaknesses, missing patches and other vulnerabilities in the FNB information systems environment. Identified vulnerabilities are classified and scored based on their Common Vulnerability Scoring System, known exploitation or malware impacting the vulnerability, and the age of the vulnerability in the environment.
To ensure the secure configuration, design, and implementation of our internally hosted and third-party hosted systems, security architecture reviews are conducted. The architecture reviews entail a series of questions, the responses to which are reviewed with internal IT and third-party vendor contacts to ensure the implementation is meeting policies, is configured with strong security practices, and utilizes appropriate access controls.
To ensure the secure configuration, design, and implementation of our internally hosted and third-party hosted systems, security architecture reviews are conducted. Architecture reviews involve asking a structured set of questions and collecting the required documentation for any proposed system changes or new implementations.
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We prioritize the patching and remediation of critical and severe vulnerabilities. We also evaluate the effectiveness of our Security Awareness Program, including results from simulated phishing exercises, to measure user susceptibility and identify areas requiring enhanced training and control focus. Threat Management Process .
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The responses and materials are then reviewed collaboratively with internal IT teams and relevant third-party vendors to confirm that the design aligns with policy requirements, follows strong security practices and implements appropriate access controls. Access Management .
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Annual security training is conducted for all employees, and routine phishing tests are administered routinely.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeFor additional information regarding the lease commitments, see Note 10, “Leases” in the Notes to Consolidated Financial Statements, which is included in Item 8 of this Report. 34 Table of Contents Following is a table that shows the branches/retail offices, by state, and the branches/retail offices owned and leased for the Community Banking segment: December 31, 2024 Community Banking Pennsylvania 184 Ohio 27 Maryland 30 West Virginia 2 North Carolina 92 South Carolina 7 Washington, D.C. 1 Virginia 6 Total number of branches/retail offices 349 Total branches/retail offices owned 190 Total branches/retail offices leased 159
Biggest changeFollowing is a table that shows the branches/retail offices, by state, and the branches/retail offices owned and leased for the Community Banking segment: December 31, 2025 Community Banking Pennsylvania 185 Ohio 28 Maryland 30 West Virginia 2 North Carolina 95 South Carolina 7 Washington, D.C. 1 Virginia 7 Total number of branches/retail offices 355 Total branches/retail offices owned 186 Total branches/retail offices leased 169
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ITEM 2. PROPERTIES Our corporate headquarters are located in Pittsburgh, Pennsylvania. The Pittsburgh headquarters, which are leased, are also occupied by employees of the Community Banking, Wealth Management and Insurance segments, including customer support and operations personnel. We also lease office space for regional headquarters in the Cleveland, Ohio, Baltimore, Maryland, and Raleigh, Charlotte and Greensboro, North Carolina markets.
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ITEM 2. PROPERTIES Our principal offices and the FNBPA’s headquarters are located at 626 Washington Place, Pittsburgh, Pennsylvania, which we own with a noncontrolling interest as a limited partner. As of December 31, 2025, we operated approximately 355 bank branch offices located throughout Pennsylvania, Ohio, South Carolina, North Carolina, Virginia, West Virginia, Maryland and Washington DC.
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In Hermitage, Pennsylvania, we own properties to house administrative, data processing personnel and various support departments, as well as offices for the Community Banking and Wealth Management segments. Additionally, we lease other office space in Harrisburg, Pennsylvania and Raleigh, North Carolina which houses various support departments.
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We do not own or lease any single physical property that we consider to be materially important to our financial condition or results from operations. Our retail branches, ATMs, ITMs, eStore, loan and mortgage production offices and administrative offices remain important to our ability to deliver financial services to a large portion of our clients.
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We have both operating and finance leases for the branches/retail offices of the Community Banking segment expiring at various dates between 2046 and 2051, which generally include options to renew. We have other operating leases that have not commenced.
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For many years, we have consolidated, relocated or opened branch locations in response to changing utilization patterns, community needs and regulatory considerations. We expect that long-term trend to continue. We consider our properties to be suitable and adequate for operating our banking business.
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In late 2024, the majority of our Pittsburgh-based employees moved into the new headquarters building under leases with a related party, consolidating several offices, subsidiaries and support departments under one roof to create opportunities for continued efficiency, collaboration and productivity improvements.
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Notes 8 and 10 to our Consolidated Financial Statements include additional information regarding investments in premises and equipment and leased properties.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeInformation required by this Item is set forth in the “Other Legal Proceedings” discussion in Note 16, “Commitments, Credit Risk and Contingencies” in the Notes to Consolidated Financial Statements, which is included in Item 8 of this Report, and which is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not Applicable. 35 Table of Contents PART II.
Biggest changeITEM 3. LEGAL PROCEEDINGS The information required by this item is set forth in Note 16, "Commitments, Credit Risk and Contingencies" under the heading “Other Legal and Regulatory Proceedings” in the Notes to Consolidated Financial Statements, contained in Part II, in Item 8 of this Report, is incorporated herein by reference. ITEM 4.
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ITEM 3. LEGAL PROCEEDINGS We are involved in various pending and threatened legal proceedings in which claims for monetary damages and other relief are asserted. These claims result from ordinary business activities relating to our current and/or former operations.
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MINE SAFETY DISCLOSURES Not Applicable. 34 Table of Contents PART II.
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Although the ultimate outcome for any asserted claim cannot be predicted with certainty, we believe that we have valid defenses for all asserted claims.
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In accordance with applicable accounting guidance, when a loss is considered probable and reasonably estimable, we, in conjunction with internal and outside counsel handling the matter, record a liability in the amount of our best estimate for the ultimate loss.
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We continue to monitor the matter for further developments that could affect the amount of the accrued liability that has previously been established. Litigation expense represents a key area of judgment and is subject to uncertainty and factors outside of our control.
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Significant judgment is required in making these estimates and our financial liabilities may ultimately be more or less than the current estimate.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe Board of Directors presently intends to continue the policy of paying quarterly cash dividends, however, there can be no assurance as to future dividends because they are dependent on our future earnings, capital requirements and financial condition. Our Board of Directors has authorized the repurchase of up to $300 million of shares of our common stock.
Biggest changeThe Board of Directors presently intends to continue the policy of paying quarterly cash dividends, however, there can be no assurance as to the timing or amount of future dividends.
This stock performance graph assumes $100 was invested on December 31, 2019, and the cumulative return is measured as of each subsequent fiscal year end. F.N.B. Corporation Five-Year Stock Performance Total Return, Including Stock and Cash Dividends Source: S & P Global Market Intelligence ITEM 6. [RESERVED] 36 Table of Contents
This stock performance graph assumes $100 was invested on December 31, 2020, and the cumulative return is measured as of each subsequent fiscal year end. F.N.B. Corporation Five-Year Stock Performance Total Return, Including Stock and Cash Dividends Source: S & P Global Market Intelligence ITEM 6. [RESERVED]
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is listed on the NYSE under the symbol “FNB.” As of January 31, 2025, there were 13,867 holders of record of our common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Stock . Our common stock is listed on the NYSE under the symbol “FNB.” As of January 31, 2026, there were 13,171 holders of record of our common stock. Dividends .
Holders of our common stock are entitled to receive cash dividends when declared by our Board of Directors out of legally available funds.
Our Board declared cash dividends totaling $0.48 per share on our common stock in both 2025 and 2024 . Holders of our common stock are entitled to receive cash dividends when declared by our Board of Directors out of legally available funds.
Removed
Since inception of this stock repurchase program in 2022, we have repurchased 14.4 million shares at a weighted average share price of $11.43 for an aggregate of $164.3 million. We did not purchase any of our own equity securities during the fourth quarter of 2024.
Added
The payment of dividends is a decision of our Board based upon then-existing circumstances, including our rate of growth, profitability, our future earnings, existing and anticipated capital requirements, financial condition, regulatory constraints and such other factors as the Board determines relevant. Share Repurchases.
Removed
The information required by this Item 5 with respect to securities authorized for issuance under equity compensation plans is set forth in Part III, Item 12 of this Report. . STOCK PERFORMANCE GRAPH Comparison of Total Return on F.N.B.
Added
The following table provides information regarding FNB's purchases of our common stock as defined by Rule 10b-18(a)(3) of the Exchange Act during the quarter ended December 31, 2025. .
Added
Period Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs October 1 - October 31, 2025 250,000 $ 15.39 250,000 $ 99,831,318 November 1 - November 30, 2025 400,000 $ 15.60 400,000 $ 93,588,118 December 1 - December 31, 2025 450,000 $ 17.19 450,000 $ 85,848,443 Total 1,100,000 $ 16.20 1,100,000 35 Table of Contents STOCK PERFORMANCE GRAPH Comparison of Total Return on F.N.B.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

159 edited+52 added−63 removed74 unchanged
Biggest changeDuring 2023, significant items impacting earnings of $91.9 million (see Table 1) were recognized. 44 Table of Contents The major categories of the Consolidated Statements of Income and their respective impact to the increase (decrease) in net income are presented in the following table: TABLE 2 Year Ended December 31 $ Change % Change (dollars in thousands, except per share data) 2024 2023 Net interest income $ 1,280,443 $ 1,316,504 $ (36,061) (2.7) % Provision for credit losses 79,776 71,754 8,022 11.2 Non-interest income 316,395 254,332 62,063 24.4 Non-interest expense 961,339 915,436 45,903 5.0 Income taxes 90,391 98,795 (8,404) (8.5) Net income 465,332 484,851 (19,519) (4.0) Less: Preferred stock dividends 6,005 8,041 (2,036) (25.3) Net income available to common shareholders $ 459,327 $ 476,810 $ (17,483) (3.7) % Earnings per common share – Basic $ 1.27 $ 1.32 $ (0.05) (3.8) % Earnings per common share – Diluted 1.27 1.31 (0.04) (3.1) Cash dividends per common share 0.48 0.48 — — The following table presents selected financial ratios and other relevant data used to analyze our performance: TABLE 3 Year Ended December 31 2024 2023 Return on average equity 7.59 % 8.29 % Return on average tangible common equity (1) 13.21 15.45 Return on average assets 0.99 1.09 Return on average tangible assets (1) 1.08 1.19 Book value per common share $ 17.52 $ 16.56 Tangible book value per common share (1) 10.49 9.47 Equity to assets 12.96 % 13.11 % Average equity to average assets 13.10 13.12 Common equity to assets 12.96 12.88 Tangible common equity to tangible assets (1) 8.18 7.79 Common equity tier 1 capital ratio 10.58 10.04 Dividend payout ratio 38.03 36.51 (1) Non-GAAP 45 Table of Contents The following table provides information regarding the average balances and yields earned on interest-earning assets (non-GAAP) and the average balances and rates paid on interest-bearing liabilities: TABLE 4 Year Ended December 31 2024 2023 2022 (dollars in thousands) Average Balance Interest Income/ Expense Yield/ Rate Average Balance Interest Income/ Expense Yield/ Rate Average Balance Interest Income/ Expense Yield/ Rate Assets Interest-bearing deposits with banks $ 1,016,253 $ 42,894 4.22 % $ 1,053,176 $ 40,860 3.88 % $ 2,174,415 $ 24,005 1.10 % Federal funds sold — — — — — — 500 29 5.81 Taxable investment securities (1) 6,189,126 194,815 3.15 6,099,052 148,374 2.43 6,126,544 115,956 1.89 Tax-exempt investment securities (1) (2) 1,027,913 35,453 3.45 1,052,416 36,476 3.46 1,010,819 34,508 3.41 Loans held for sale 213,210 16,469 7.72 131,985 9,496 7.19 189,360 8,151 4.30 Loans and leases (2) (3) 33,320,176 1,974,205 5.92 31,372,574 1,749,786 5.58 27,829,166 1,113,593 4.00 Total interest-earning assets (2) 41,766,678 2,263,836 5.42 39,709,203 1,984,992 5.00 37,330,804 1,296,242 3.47 Cash and due from banks 400,194 435,271 429,741 Allowance for credit losses (419,291) (409,342) (377,252) Premises and equipment 493,820 456,844 405,023 Other assets 4,571,166 4,417,627 4,166,392 Total assets $ 46,812,567 $ 44,609,603 $ 41,954,708 Liabilities Deposits: Interest-bearing demand $ 15,204,358 416,860 2.74 $ 14,296,571 283,914 1.99 $ 14,951,905 78,599 0.53 Savings 3,314,905 39,926 1.20 3,766,920 37,338 0.99 3,976,285 8,512 0.21 Certificates and other time 6,929,342 297,183 4.29 5,176,674 173,680 3.36 3,004,482 21,410 0.71 Total interest-bearing deposits 25,448,605 753,969 2.96 23,240,165 494,932 2.13 21,932,672 108,521 0.49 Short-term borrowings 2,057,597 99,055 4.80 2,075,751 77,883 3.75 1,427,361 24,535 1.72 Long-term borrowings 2,292,523 118,683 5.18 1,685,554 83,332 4.94 836,154 32,118 3.84 Total interest-bearing liabilities 29,798,725 971,707 3.26 27,001,470 656,147 2.43 24,196,187 165,174 0.68 Non-interest-bearing demand deposits 9,897,298 10,900,280 11,639,499 Total deposits and borrowings 39,696,023 2.45 37,901,750 1.73 35,835,686 0.46 Other liabilities 984,198 856,771 643,179 Total liabilities 40,680,221 38,758,521 36,478,865 Shareholders’ equity 6,132,346 5,851,082 5,475,843 Total liabilities and shareholders’ equity $ 46,812,567 $ 44,609,603 $ 41,954,708 Net interest-earning assets $ 11,967,953 $ 12,707,733 $ 13,134,617 Net interest income (FTE) (2) 1,292,129 1,328,845 1,131,068 Tax-equivalent adjustment (11,686) (12,341) (11,288) Net interest income $ 1,280,443 $ 1,316,504 $ 1,119,780 Net interest spread 2.16 % 2.57 % 2.79 % Net interest margin (2) 3.09 % 3.35 % 3.03 % (1) The average balances and yields earned on securities are based on historical cost.
Biggest changeThe following table presents selected financial ratios and other relevant data used to analyze our performance: TABLE 3 Year Ended December 31 2025 2024 Return on average equity 8.66 % 7.59 % Return on average tangible common equity (1) 14.42 13.21 Return on average assets 1.15 0.99 Return on average tangible assets (1) 1.24 1.08 Equity to assets 13.46 12.96 Average equity to average assets 13.27 13.10 Tangible common equity to tangible assets (1) 8.89 8.18 CET1 capital ratio 11.36 10.58 Dividend payout ratio 30.83 38.03 Book value per common share $ 18.92 $ 17.52 Tangible book value per common share (1) 11.87 10.49 (1) Non-GAAP 44 Table of Contents The following table provides information regarding the average balances and yields earned on interest-earning assets (non-GAAP) and the average balances and rates paid on interest-bearing liabilities: TABLE 4 Year Ended December 31 2025 2024 2023 (dollars in thousands) Average Balance Interest Income/ Expense Yield/ Rate Average Balance Interest Income/ Expense Yield/ Rate Average Balance Interest Income/ Expense Yield/ Rate Assets Interest-bearing deposits with banks $ 1,738,835 $ 69,958 4.02 % $ 1,016,253 $ 42,894 4.22 % $ 1,053,176 $ 40,860 3.88 % Taxable investment securities (1) 6,586,431 231,135 3.51 6,189,126 194,815 3.15 6,099,052 148,374 2.43 Tax-exempt investment securities (1) (2) 1,004,803 35,007 3.48 1,027,913 35,453 3.45 1,052,416 36,476 3.46 Loans held for sale 272,587 19,790 7.26 213,210 16,469 7.72 131,985 9,496 7.19 Loans and leases (2) (3) 34,590,865 1,981,957 5.73 33,320,176 1,974,205 5.92 31,372,574 1,749,786 5.58 Total interest-earning assets (2) 44,193,521 2,337,847 5.29 41,766,678 2,263,836 5.42 39,709,203 1,984,992 5.00 Cash and due from banks 398,313 400,194 435,271 Allowance for credit losses (437,404) (419,291) (409,342) Premises and equipment 554,540 493,820 456,844 Other assets 4,514,166 4,571,166 4,417,627 Total assets $ 49,223,136 $ 46,812,567 $ 44,609,603 Liabilities Deposits: Interest-bearing demand $ 17,337,972 439,467 2.53 $ 15,204,358 416,860 2.74 $ 14,296,571 283,914 1.99 Savings 3,129,059 29,943 0.96 3,314,905 39,926 1.20 3,766,920 37,338 0.99 Certificates and other time 7,344,944 267,655 3.64 6,929,342 297,183 4.29 5,176,674 173,680 3.36 Total interest-bearing deposits 27,811,975 737,065 2.65 25,448,605 753,969 2.96 23,240,165 494,932 2.13 Short-term borrowings 1,651,597 67,891 4.09 2,057,597 99,055 4.80 2,075,751 77,883 3.75 Long-term borrowings 2,502,234 124,829 4.99 2,292,523 118,683 5.18 1,685,554 83,332 4.94 Total interest-bearing liabilities 31,965,806 929,785 2.91 29,798,725 971,707 3.26 27,001,470 656,147 2.43 Non-interest-bearing demand deposits 9,847,253 9,897,298 10,900,280 Total deposits and borrowings 41,813,059 2.22 39,696,023 2.45 37,901,750 1.73 Other liabilities 878,912 984,198 856,771 Total liabilities 42,691,971 40,680,221 38,758,521 Shareholders’ equity 6,531,165 6,132,346 5,851,082 Total liabilities and shareholders’ equity $ 49,223,136 $ 46,812,567 $ 44,609,603 Net interest-earning assets $ 12,227,715 $ 11,967,953 $ 12,707,733 Net interest income (FTE) (2) 1,408,062 1,292,129 1,328,845 Tax-equivalent adjustment (12,307) (11,686) (12,341) Net interest income $ 1,395,755 $ 1,280,443 $ 1,316,504 Net interest spread 2.38 % 2.16 % 2.57 % Net interest margin (2) 3.19 % 3.09 % 3.35 % (1) The average balances and yields earned on investment securities are based on historical cost.
USE OF NON-GAAP FINANCIAL MEASURES AND KEY PERFORMANCE INDICATORS 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, operating 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 income, operating non-interest expense, 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.
USE OF NON-GAAP FINANCIAL MEASURES AND KEY PERFORMANCE INDICATORS 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 income, operating non-interest expense, 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.
The model used to calculate the ACL is dependent on the portfolio composition and credit quality, as well as historical experience, current conditions and forecasts of economic conditions and interest rates.
The model used to calculate the ACL is dependent on the portfolio composition and credit quality, as well as historical experience, current conditions and forecasts of economic conditions and interest rates.
Specifically, the following considerations are incorporated into the ACL calculation: • a third-party macroeconomic forecast scenario; • a 24-month R&S forecast period for macroeconomic factors with a reversion to the historical mean on a straight-line basis over a 12-month period; and • the historical through-the-cycle default mean calculated using an expanded period to include a prior recessionary period.
Specifically, the following considerations are incorporated into the ACL calculation: • a third-party macroeconomic forecast scenario; • a 24-month R&S forecast period for macroeconomic factors with a reversion to the historical mean on a straight-line basis over a 12-month period; and • the historical through-the-cycle default mean calculated using an expanded period to include a prior recessionary period.
Using a static Balance Sheet structure and utilizing net interest income simulations, the following table presents an analysis of the potential sensitivity of our net interest income to changes in interest rates using Rate Ramps and the sensitivity of EVE using Rate Shocks.
Using a static Balance Sheet structure and utilizing net interest income simulations, the following table presents an analysis of the potential sensitivity of our net interest income to changes in interest rates using Rate Ramps and Rate Shocks and the sensitivity of EVE using Rate Shocks.
Management has determined that no credit loss exists on securities AFS. Securities, like loans, are subject to interest rate and credit risk. In addition, by their nature, securities classified as AFS are also subject to fair value risks that could negatively affect the level of liquidity available to us, as well as shareholders’ equity.
Management has determined that no credit loss exists on securities AFS. Securities, like loans, are subject to interest rate and credit risk. In addition, by their nature, securities classified as AFS are also subject to fair value risks that could negatively affect the level of liquidity available to us and shareholders’ equity.
We use our risk appetite processes to promote appropriate alignment of risk, capital and performance tactics, while also considering risk capacity and appetite constraints from both financial and non-financial risks. The Board of Directors adopted an enterprise risk appetite that defines acceptable risk limits under which we seek to operate in pursuit of optimizing returns.
We use our risk appetite processes to promote appropriate alignment of risk, capital and performance tactics, while also considering risk appetite constraints from both financial and non-financial risks. The Board of Directors adopted an enterprise risk appetite that defines acceptable risk limits under which we seek to operate in pursuit of optimizing returns.
In the event of a prolonged economic downturn or deterioration in the economic outlook, interim quantitative assessments of our goodwill balance could be required in future periods. Any impairment charge would not directly affect our capital ratios, tangible common equity, tangible book value per share or liquidity position.
In the event of a prolonged economic downturn or deterioration in the economic outlook, interim quantitative assessments of our goodwill balance could be required in future periods. Any impairment charge would not directly affect our regulatory capital ratios, tangible common equity, tangible book value per share or liquidity position.
Forward-looking statements may relate to various matters, including our financial condition, results of operations, plans, objectives, future performance, business or industry, and usually can be identified by the use of forward-looking words, such as “anticipates,” “assumes,” “believes,” “can,” “continues,” “could,” “estimates,” “expects,” “forecasts,” “goal,” “intends,” “likely,” “may,” “might,” “objective,” “plans,” “potential,” “projects,” “remains,” “should,” “target,” “trend,” “will,” “would,” or similar words or expressions or variations thereof, and the negative thereof, but these terms are not the exclusive means of identifying such statements.
Forward-looking statements may relate to various matters, including our financial condition, results of operations, plans, objectives, future performance, business or industry, and usually can be identified by the use of forward-looking words, such as “anticipates,” “assumes,” “believes,” “can,” “continues,” “could,” “enable,” “estimates,” “expects,” “forecasts,” “goal,” “intends,” “likely,” “may,” “might,” “objective,” “plans,” “positioned,” “potential,” “projects,” “remains,” “should,” “target,” “trend,” “will,” “would,” or similar words or expressions or variations thereof, and the negative thereof, but these terms are not the exclusive means of identifying such statements.
The Risk Committee serves as the primary point of contact between our Board of Directors and the Risk Management Council (RMC), which is the senior management level committee responsible for identifying, assessing, monitoring and reporting on enterprise-wide risks.
The Board Risk Committee serves as the primary point of contact between our Board of Directors and the Risk Management Council (RMC), which is the senior management level committee responsible for identifying, assessing, monitoring and reporting on material enterprise-wide risks.
Inputs and assumptions used in estimating fair value include projected future cash flows, discount rates reflecting the risk inherent in future cash flows, long-term growth rates, anticipated cost savings and an evaluation of market comparables and recent transactions. Goodwill assessments are highly sensitive to economic projections and the related assumptions and estimates used by management.
Inputs and assumptions used in estimating fair value included projected future cash flows, discount rates reflecting the risk inherent in future cash flows, long-term growth rates, anticipated cost savings and an evaluation of market comparables and recent transactions. Goodwill assessments are highly sensitive to economic projections and the related assumptions and estimates used by management.
The dividends received from the Bank and other direct subsidiaries may be impacted by the parent’s or its subsidiaries’ capital and liquidity needs, statutory laws and regulations, corporate policies, contractual restrictions, profitability and other factors. In addition, through one of our subsidiaries, we regularly issue subordinated notes, which are guaranteed by FNB.
The dividends received from FNBPA and other direct subsidiaries may be impacted by the parent’s or its subsidiaries’ capital and liquidity needs, statutory laws and regulations, corporate policies, contractual restrictions, profitability and other factors. In addition, through one of our subsidiaries, we regularly issue subordinated notes, which are guaranteed by FNB.
For our ACL calculation at December 31, 2024, the macroeconomic variables that we utilized 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.
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.
We also performed a qualitative analysis through year-end and concluded that it was not more-likely-than-not that the fair value of one or more of our reporting units was below its respective carrying amount, and therefore no triggering event has occurred, as of December 31, 2024.
We also performed a qualitative analysis through year-end and concluded that it was not more-likely-than-not that the fair value of one or more of our reporting units was below its respective carrying amount, and therefore no triggering event has occurred, as of December 31, 2025.
The following liquidity gap analysis as of December 31, 2024 compares the difference between our cash flows from existing earning assets and interest-bearing liabilities over future time intervals. Management calculates this ratio at least quarterly and it is reviewed regularly by ALCO.
The following liquidity gap analysis as of December 31, 2025 compares the difference between our cash flows from existing earning assets and interest-bearing liabilities over future time intervals. Management calculates this ratio at least quarterly and it is reviewed regularly by ALCO.
Recent Accounting Pronouncements and Developments Note 2, “New Accounting Standards” in the Notes to Consolidated Financial Statements, which is included in Item 8 of this Report, discusses new accounting pronouncements adopted by us in 2024 and the expected impact of accounting pronouncements recently issued but not yet required to be adopted.
Recent Accounting Pronouncements and Developments Note 2, “New Accounting Standards” in the Notes to Consolidated Financial Statements, which is included in Item 8 of this Report, discusses new accounting pronouncements adopted by us in 2025 and the expected impact of accounting pronouncements recently issued but not yet required to be adopted.
Over time, our liquidity position has been positively impacted by FNBPA's ability to generate growth in relationship-based accounts.
Over time, our liquidity position has been positively impacted by FNBPA's ability to generate growth in relationship-based deposit accounts.
Taxable-equivalent amounts for 2024, 2023 and 2022 were calculated using a federal statutory income tax rate of 21%. OVERVIEW FNB, headquartered in Pittsburgh, Pennsylvania, is a diversified financial services company operating in seven states and the District of Columbia.
Taxable-equivalent amounts for 2025, 2024 and 2023 were calculated using a federal statutory income tax rate of 21%. OVERVIEW FNB, headquartered in Pittsburgh, Pennsylvania, is a diversified financial services company operating in seven states and the District of Columbia.
Our current interest rate risk position is modestly 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.
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.
The parent company’s funding sources primarily consist of dividends and interest received from the Bank and other direct subsidiaries, net taxes collected from subsidiaries included in the consolidated tax returns, fees for services provided to subsidiaries and the issuance of debt instruments.
The parent company’s funding sources primarily consist of dividends and interest received from FNBPA and other direct subsidiaries, net taxes collected from subsidiaries included in the consolidated tax returns, fees for services provided to subsidiaries and the issuance of debt instruments.
The following table indicates the respective contractual maturities and weighted-average yields of debt securities HTM, shown at amortized cost, as of December 31, 2024: TABLE 21 (dollars in millions) Amount Weighted Average Yield Obligations of U.S.
The following table indicates the respective contractual maturities and weighted-average yields of debt securities HTM, shown at amortized cost, as of December 31, 2025: TABLE 21 (dollars in millions) Amount Weighted Average Yield Obligations of U.S.
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. APPLICATION OF CRITICAL ACCOUNTING POLICIES Our Consolidated Financial Statements are prepared in accordance with GAAP.
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. 37 Table of Contents APPLICATION OF CRITICAL ACCOUNTING POLICIES Our Consolidated Financial Statements are prepared in accordance with GAAP.
See Note 1, “Summary of Significant Accounting Policies” and Note 9, “Goodwill and Other Intangible Assets” in the Notes to Consolidated Financial Statements for further discussion of accounting for goodwill and other intangible assets. 39 Table of Contents Income Taxes and Deferred Tax Assets We are subject to the income tax laws of federal, state and other taxing jurisdictions where we conduct business.
See Note 1, “Summary of Significant Accounting Policies” and Note 9, “Goodwill and Other Intangible Assets” in the Notes to Consolidated Financial Statements for further discussion of accounting for goodwill and other intangible assets. Income Taxes and Deferred Tax Assets We are subject to the income tax laws of federal, state and other taxing jurisdictions where we conduct business.
The Bank also has access to reliable and cost-effective wholesale sources of liquidity. Short- and long-term funds are available for use to help fund normal business operations, and unused credit availability can be utilized to serve as contingency funding if faced with a liquidity crisis.
FNBPA also has access to reliable and cost-effective wholesale sources of liquidity. Short- and long-term funds are available for use to help fund normal business operations, and unused credit availability can be utilized to serve as contingency funding if faced with a liquidity crisis.
Subject to its ongoing oversight, the Board of Directors has given ALCO the responsibility for market risk management, which involves devising policy guidelines, risk measures and limits, and managing the amount of interest rate risk and its effect on net interest income and capital. We use derivative financial instruments for interest rate risk management purposes.
Subject to its ongoing oversight, the Board of Directors has given ALCO the responsibility for market risk management, which involves devising policy guidelines, risk measures and limits, and managing the amount of interest rate risk and its effect on net interest income and capital. We use derivative financial instruments, among other strategies, for interest rate risk management purposes.
In connection with the preparation of the year-end 2024 financial statements, we completed our annual goodwill impairment test as of October 1, 2024. No impairment was identified in any of our reporting units.
In connection with the preparation of the year-end 2025 financial statements, we completed our annual goodwill impairment test as of October 1, 2025. No impairment was identified in any of our reporting units.
Bank Liquidity Bank-level liquidity sources from assets include payments from loans and investments, as well as the ability to securitize, pledge or sell loans, investment securities and other assets. Liquidity sources from liabilities are generated primarily through the banking offices of FNBPA in the form of deposits and customer repurchase agreements.
Bank Liquidity Bank-level liquidity sources from assets include payments from loans and investments, as well as the ability to securitize, pledge or sell loans, investment securities and other assets. Liquidity sources from liabilities are generated primarily through the 61 Table of Contents banking offices of FNBPA in the form of deposits and customer repurchase agreements.
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.
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 59 Table of Contents purchase contracts or units.
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. As of December 31, 2024, we had 349 branches throughout Pennsylvania, Ohio, Maryland, West Virginia, North Carolina, South Carolina, Washington D.C. and Virginia.
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. As of December 31, 2025, we had 355 branches throughout Pennsylvania, Ohio, Maryland, West Virginia, North Carolina, South Carolina, Washington D.C. and Virginia.
Asset/liability models require certain assumptions to be made, such as prepayment rates on interest-earning assets and repricing impact on non-maturity deposits, which may differ from actual experience. These business assumptions are based upon our experience, business plans, economic and market trends and available industry data.
Asset/liability models require certain assumptions to be made, such as prepayment rates on interest-earning assets and repricing impact on non-maturity deposits, which may differ from actual experience. These business assumptions are based upon our experience, business plans, economic 65 Table of Contents and market trends and available industry data.
We support our risk management processes and business oversight through three lines of defense and a governance structure at the Board of Directors and management levels.
We support our risk management processes and business oversight through a three lines model and a governance structure at the Board of Directors and management levels.
See Note 1, “Summary of Significant Accounting Policies,” Note 5, “Loans and Leases” and 38 Table of Contents Note 6, “Allowance for Credit Losses on Loans and Leases” in the Notes to Consolidated Financial Statements for further information on the ACL.
See Note 1, “Summary of Significant Accounting Policies,” Note 5, “Loans and Leases” and Note 6, “Allowance for Credit Losses on Loans and Leases” in the Notes to Consolidated Financial Statements for further information on the ACL.
The Risk Committee and RMC are supported by other risk management committees, including Credit Risk Committees, Operational Risk Committee, Compliance Risk Committee and ALCO. Risk appetite is an integral element of our enterprise risk management framework and of our business and capital planning processes through our Board Risk Committee and Risk Management Council.
The Risk Committee and RMC are supported by other risk management committees, including Credit Risk Committees, the Operational Risk Committee, the Compliance Risk Committee and the ALCO. Risk appetite is an integral element of our ERM Framework and of our business and capital planning processes through our Board Risk Committee and RMC.
That effect would be included in income in the reporting period that includes the enactment date of the change. See the Results of Operations, Income Taxes section later in this MD&A for further tax-related discussion.
That effect would be included in income in the reporting period 39 Table of Contents that includes the enactment date of the change. See the Results of Operations, Income Taxes section later in this MD&A for further tax-related discussion.
The lines of defense model consists of: • First Line of Defense - consists of our businesses and enterprise support areas that engage in risk-taking activities and are principally responsible for owning and managing the day-to-day operational activities in accordance with the risk frameworks. • Second Line of Defense - consists of the Risk Management Department responsible for developing risk frameworks and identifying, assessing, overseeing and controlling enterprise aggregate risks independent from the First Line of Defense. • Third Line of Defense - is Internal Audit and develops and executes a risk-based audit plan to provide assurance on the compliance and effectiveness of controls and risk management practices throughout the organization independent from the First and Second Lines of Defense.
The three lines model consists of: • First Line - consists of our businesses and enterprise support areas that engage in risk-taking activities and are principally responsible for owning and managing the day-to-day operational activities in accordance with the risk frameworks. • Second Line - consists of the Risk Management Department responsible for developing risk frameworks and identifying, assessing, overseeing and controlling enterprise aggregate risks independent from the First Line. • Third Line - consists of the Internal Audit Department, responsible for developing and executing a risk-based audit plan to provide assurance on the compliance and effectiveness of controls and risk management practices throughout the organization independent from the First and Second Lines.
You should not place undue reliance on forward-looking statements, as they are subject to risks and uncertainties, including, but not limited to, those described below. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements we may make.
You should not place undue reliance on forward-looking statements, as they 36 Table of Contents are subject to risks and uncertainties, including, but not limited to, those described below. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements we may make.
At December 31, 2024 and 2023, we utilized a third-party consensus macroeconomic forecast reflecting the current and projected macroeconomic environment.
At December 31, 2025 and 2024, we utilized a third-party consensus macroeconomic forecast reflecting the current and projected macroeconomic environment.
A change in the value of securities HTM could also negatively affect the level of shareholders’ equity if there was a decline in the underlying creditworthiness of the issuers. A CECL methodology is applied to securities HTM. As of December 31, 2024, securities HTM had a CECL ACL of $0.25 million.
A change in the value of securities HTM could also negatively affect the level of shareholders’ equity if there was a decline in the underlying creditworthiness of the issuers. A CECL methodology is applied to securities HTM. As of December 31, 2025, securities HTM had a CECL ACL of $0.29 million.
Reviewing these various measures provides us with a comprehensive view of our interest rate risk profile, which provides the basis for balance sheet management strategies. The following repricing gap analysis as of December 31, 2024 compares the difference between the amount of interest-earning assets and interest-bearing liabilities subject to repricing.
Reviewing these various measures provides us with a comprehensive view of our interest rate risk profile, which provides the basis for balance sheet management strategies. 63 Table of Contents The following repricing gap analysis as of December 31, 2025 compares the difference between the amount of interest-earning assets and interest-bearing liabilities subject to repricing.
Our Board Risk Committee, in collaboration with our Risk Management Council, approves our risk appetite on an annual basis, or more frequently, as needed to reflect changes in the risk, regulatory, economic and strategic plan environments, with the goal of ensuring that our strategic plans and business operations remain consistent with our risk appetite given the current regulatory environment and shareholders' expectations.
Our Board Risk Committee, in collaboration with our RMC, approves our risk appetite on an annual basis, or more frequently, as needed to reflect changes in the risk, regulatory, economic and strategic plan environments, with the goal of ensuring that our strategic plans and business operations remain consistent with our risk appetite given the current economic and regulatory environments, as well as shareholders' expectations.
Factors that might cause such differences, include, but are not limited to: • the credit risk associated with the substantial amount of commercial loans and leases in our loan portfolio; • the volatility of the mortgage banking business; • changes in market interest rates and the unpredictability of monetary, tax and other policies of government agencies; • the impact of changes in interest rates on the value of our securities portfolios; • changes in our ability to obtain liquidity as and when needed to fund our obligations as they come due, including as a result of adverse changes to our credit ratings; • the risk associated with uninsured deposit account balances; • regulatory limits on our ability to receive dividends from our subsidiaries and pay dividends to our shareholders; • our ability to recruit and retain qualified banking professionals; • the financial soundness of other financial institutions and the impact of volatility in the banking sector on us; • changes and instability in economic conditions and financial markets, in the regions in which we operate or otherwise, including a contraction of economic activity; • our ability to continue to invest in technological improvements as they become appropriate or necessary; • any interruption in or breach in security of our information systems, or other cybersecurity risks; • risks associated with reliance on third-party vendors; • risks associated with the use of models, estimations and assumptions in our business; • the effects of adverse weather events and public health emergencies; • the risks associated with acquiring other banks and financial services business, including integration into our existing operations; • the extensive federal and state regulation, supervision and examination governing almost every aspect of our operations, and potential expenses associated with complying with such regulations; • our ability to comply with the consent orders entered into by FNBPA with the DOJ and the North Carolina State Department of Justice, and related costs and potential reputational harm; • changes in federal, state or local tax rules and regulations or interpretations, or accounting policies, standards and interpretations; 37 Table of Contents • the effects of climate change and related legislative and regulatory initiatives; and • any reputation, credit, interest rate, market, operational, litigation, legal, liquidity, regulatory and compliance risk resulting from developments related to any of the risks discussed above.
Factors that might cause such differences, include, but are not limited to: • the credit risk associated with the substantial amount of commercial loans and leases in our loan portfolio; • the volatility of the mortgage banking business; • 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 of new tariffs, trade wars, barriers or restrictions, or threats of such actions; • the impact of changes in interest rates on the value of our investment securities portfolios; • changes in our ability to obtain liquidity as and when needed to fund our obligations as they come due, including as a result of adverse changes to our credit ratings; • the risk associated with uninsured deposit account balances; • regulatory limits on our ability to receive dividends from our subsidiaries and pay dividends to our shareholders; • our ability to recruit and retain qualified banking professionals; • the financial soundness of other financial institutions and the impact of volatility in the banking sector on us; • 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; • our ability to continue to invest in technological improvements as they become appropriate or necessary; • any interruption in or breach in security of our information systems, or other cybersecurity risks; • risks associated with reliance on third-party vendors and AI; • risks associated with the use of models, estimations and assumptions in our business; • the effects of adverse weather events and public health emergencies; • the risks associated with acquiring other banks and financial services businesses, including integration into our existing operations; • the extensive federal and state regulations, supervision and examination governing almost every aspect of our operations, and potential expenses associated with complying with such regulations; • our ability to comply with the consent orders entered into by FNBPA with the DOJ and the North Carolina State Department of Justice, and related costs and potential reputational harm; • changes in federal, state or local tax rules and regulations or interpretations, or accounting policies, standards and interpretations; • the effects of climate change and related legislative and regulatory initiatives; and • any reputation, credit, interest rate, market, operational, litigation, legal, liquidity, regulatory and compliance risk resulting from developments related to any of the risks discussed above.
We typically enter into offsetting third-party contracts with reputable counterparties with substantially matching terms to economically hedge the exposure related to these derivatives. At December 31, 2024, the commercial customer-related interest rate swaps totaled $5.9 billion (notional), up from $5.7 billion (notional) at December 31, 2023.
We typically enter into offsetting third-party contracts with reputable counterparties with substantially matching terms to economically hedge the exposure related to these derivatives. At December 31, 2025, the commercial customer-related interest rate swaps totaled $6.1 billion (notional), up from $5.9 billion (notional) at December 31, 2024.
As a result of management's strategies to reduce its asset sensitive position, the twelve-month cumulative repricing gap to total assets was 4.5% as of December 31, 2024, down from 10.3% at December 31, 2023.
As a result of management's strategies to reduce its asset sensitive position, the twelve-month cumulative repricing gap to total assets was 3.2% as of December 31, 2025, down from 4.5% at December 31, 2024.
We provide a full range of commercial banking, consumer banking, insurance and wealth management solutions through our subsidiary network which is led by our largest affiliate, FNBPA. Commercial banking solutions include corporate banking, small business banking, investment real estate financing, government banking, business credit, capital markets and lease financing.
We provide a full range of commercial banking, consumer banking, insurance and wealth management solutions 40 Table of Contents through our subsidiary network which is led by our largest affiliate, FNBPA. Commercial banking solutions include corporate banking, small business banking, investment real estate financing, government banking, business credit, capital markets and equipment financing.
As a result, the net interest income change over 12 months shown above in both the up and down rate ramp scenarios is closer to neutral compared to December 31, 2023. We also utilize derivatives to manage the IRR position.
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, 2024. We also utilize derivatives to manage the IRR position.
In its oversight role of our risk management function, the Board of Directors focuses on the strategies, analyses and conclusions of management relating to identifying, understanding and managing risks to optimize total shareholder value, while balancing prudent business and safety and soundness considerations.
In its oversight role of our risk management function, the Board of Directors focuses on the strategies, analyses and conclusions of management relating to 66 Table of Contents identifying, understanding and managing risks to optimize total shareholder value, while balancing prudent business and safety and soundness considerations to safeguard our reputation.
Total variable and adjustable-rate loans were 62.9% and 62.2% of total net loans and leases at December 31, 2024 and December 31, 2023, respectively. Forty-seven 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.
Total variable and adjustable-rate loans were 63.4% and 62.9% of total net loans and leases at December 31, 2025 and December 31, 2024, 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.
In addition, monitors the integrity of the consolidated financial statements, internal controls over financial reporting, qualifications and independence of our audit function. 68 Table of Contents • Nominating and Corporate Governance Committee - responsible for selecting and recommending nominees for election to the FNB and FNBPA Boards of Directors. • Compensation Committee - reviews performance and compensation of senior management and reviews and implements compensation and benefit matters having corporate-wide significance. • Executive Committee - joint session of the FNB and FNBPA Board of Directors to cover special matters, as deemed necessary, in between regularly scheduled board meetings. • Risk Committee - provides oversight and approves the enterprise-wide Risk Governance Framework (ERM Framework) including the review and approval of risk management policies and practices to identify, assess, monitor and report material risks. • Credit Fair Lending and CRA Committee - responsible for providing oversight of credit and lending strategies and objectives.
In addition, monitors the integrity of the Consolidated Financial Statements, internal controls over financial reporting, qualifications and independence of our audit function. • Nominating and Corporate Governance Committee - responsible for selecting and recommending nominees for election to the FNB and FNBPA Boards of Directors. • Compensation Committee - reviews performance and compensation of senior management and reviews and implements compensation and benefit matters having corporate-wide significance. • Executive Committee - joint session of the FNB and FNBPA Board of Directors to cover special matters, as deemed necessary, in between regularly scheduled board meetings. • Risk Committee - provides oversight and approves the ERM Framework including the review and approval of risk management policies and practices to identify, assess, monitor and report material risks. • Credit Risk, Fair Lending and CRA Committee - responsible for providing oversight of credit and lending risk management strategies and objectives of FNB and FNBPA, providing oversight of FNBPA's CRA program, policy and practices, and performing reviews of fair lending strategies, analysis and results to assist with its credit oversight responsibilities.
Reports relating to our risk appetite and strategic plans, and our ongoing monitoring thereof, and our aggregate risk profile, are regularly presented to our various management level risk oversight and planning committees and periodically reported up through our Board Risk Committee.
Reports relating to our risk appetite and strategic plans, and our ongoing monitoring thereof, and our 67 Table of Contents aggregate risk profile, are regularly presented to our various management level risk oversight committees and periodically reported up through our Board Risk Committee.
Macroeconomic variables that we utilized for our ACL calculation as of December 31, 2023 included, but were not limited to: (i) the purchase only Housing Price Index, which increases 5.3% over our R&S forecast period, (ii) a Commercial Real Estate Price Index, which increases 0.1% over our R&S forecast period, (iii) S&P Volatility, which decreases 4.0% in 2024 and 2.9% in 2025 and (iv) bankruptcies, which increase steadily over the R&S forecast period but average below the historical through the cycle period.
For our ACL calculation at December 31, 2025, the macroeconomic variables that we utilized 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.
At December 31, 2024, approximately 77% of our deposits were insured by the FDIC or collateralized, stable with December 31, 2023. Our cash balances held at the FRB were $2.0 billion at December 31, 2024 and $1.1 billion at December 31, 2023.
At December 31, 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 $2.1 billion at December 31, 2025 and $2.0 billion at December 31, 2024.
TABLE 32 December 31, 2024 2023 ALCO Limits Net interest income change over 12 months (Rate Ramps): + 200 basis points 3.0 % 3.9 % (10.0) % + 100 basis points 1.5 2.0 (10.0) – 100 basis points (1.5) (2.0) (10.0) – 200 basis points (3.1) (4.1) (10.0) Economic value of equity (Rate Shocks): + 300 basis points 4.5 4.6 (25.0) + 200 basis points 3.3 3.2 (15.0) + 100 basis points 1.9 1.6 (10.0) – 100 basis points (3.2) (2.5) (10.0) – 200 basis points (6.9) (8.0) (15.0) 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.
The calculated results do not reflect management's potential actions. 64 Table of Contents TABLE 31 December 31, 2025 2024 ALCO Limits Net interest income change over 12 months (Rate Ramps): + 200 basis points 1.6 % 3.0 % (10.0) % + 100 basis points 0.8 1.5 (10.0) – 100 basis points (0.9) (1.5) (10.0) – 200 basis points (1.9) (3.1) (10.0) Net interest income change over 12 months (Rate Shocks): + 200 basis points 2.5 3.9 (10.0) + 100 basis points 1.4 2.0 (10.0) - 100 basis points (1.8) (2.2) (10.0) - 200 basis points (4.2) (4.6) (10.0) Economic value of equity (Rate Shocks): + 300 basis points 5.6 4.5 (25.0) + 200 basis points 4.2 3.3 (15.0) + 100 basis points 2.7 1.9 (10.0) – 100 basis points (3.9) (3.2) (10.0) – 200 basis points (9.5) (6.9) (15.0) 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.
For additional information relating to investment activity, see Note 3, “Securities” in the Notes to Consolidated Financial Statements, which is included in Item 8 of this Report. 59 Table of Contents Deposits Our primary source of funds is deposits. Our diversified and granular deposit base are provided by business, consumer and municipal customers who we serve within our footprint.
For additional information relating to investment activity, see Note 3, “Investment Securities” in the Notes to Consolidated Financial Statements, which is included in Item 8 of this Report. 58 Table of Contents Deposits Our primary source of funds is deposits. Our diversified and granular deposit base is comprised of business, consumer and municipal customers who we serve within our footprint.
Our organic loan growth in 2024 was driven by the continued success of our strategy to grow high-quality loans and deepen customer relationships across our diverse geographic footprint. As of both December 31, 2024 and 2023, 29.0% of the commercial real estate loans were owner-occupied, while the remaining 71.0% were non-owner-occupied.
Our organic loan growth in 2025 was driven by the continued success of our strategy to grow high-quality loans and deepen customer relationships across our diverse geographic footprint. As of December 31, 2025, 30.9% of the commercial real estate loans were owner-occupied, while the remaining 69.1% were non-owner-occupied, compared to 29.0% and 71.0%, respectively, as of December 31, 2024.
Consumer banking products and services include deposit products, mortgage lending, consumer lending and a complete suite of mobile and online banking services. Wealth management services include asset management, private banking and insurance. FINANCIAL SUMMARY For 2024, net income available to common shareholders was $459.3 million, or $1.27 per diluted common share.
Consumer banking products and services include deposit products, mortgage lending, consumer lending and a complete suite of mobile and online banking services. Wealth management services include asset management, private banking and insurance. FINANCIAL SUMMARY For 2025, net income available to common shareholders was $565.4 million, or $1.56 per diluted common share.
Our commercial real estate portfolio included $9.0 billion of non-owner occupied loans, of which 18.7% represented office loans.
Our commercial real estate portfolio included $8.5 billion of non-owner occupied loans, of which 18.0% represented office loans.
Our top 25 non-owner occupied commercial real estate loans averaged approximately $22 million per exposure with the office component comprised of mid-sized offices primarily located outside of central business districts with 43% of the office portfolio averaging less than $5 million per exposure.
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 and 42% of the office portfolio averaging less than $5 million per exposure.
To succeed in this capacity, we offer an extensive variety of financial products to meet the diverse needs of our customers. These products sometimes contribute to interest rate risk for us when product groups do not complement one another. For example, depositors may want short-term deposits, while borrowers may desire long-term loans.
To succeed in this capacity, we offer an extensive variety of financial products to meet the diverse needs of our customers. These products sometimes contribute to interest rate risk for us when product groups possess different cash flow characteristics. For example, depositors may want short-term deposits, while borrowers may desire long-term loans.
Our recorded goodwill relates to value inherent in our Community Banking, Wealth Management and Insurance segments. The value of goodwill and other identifiable intangibles is dependent upon our ability to provide high quality, cost-effective services in the face of competition. As such, these values are supported ultimately by revenue that is driven by the volume of business transacted.
The value of goodwill and other identifiable intangibles is dependent upon our ability to provide high quality, cost-effective services in the face of competition. As such, these values are supported ultimately by revenue that is driven by the volume of business transacted.
The accounting guidance for fair value measurements includes a three-level hierarchy for disclosure of assets and liabilities recorded at fair value based on whether the inputs to the valuation methodology used for measurement are observable or unobservable. Judgment is required to determine which level of the three-level hierarchy certain assets or liabilities measured at fair value are classified.
The accounting guidance for fair value measurements includes a three-level hierarchy for disclosure of assets and liabilities recorded at fair value based on whether the inputs to the valuation methodology used for measurement are observable or unobservable.
Non-accrual loans of $159.6 million at December 31, 2024 increased $52.4 million, or 48.9%, compared to December 31, 2023, attributed to a small number of commercial real estate loans, with both periods remaining at relatively low levels. 54 Table of Contents Following is a summary of non-performing loans and leases, by class, OREO and non-performing assets: TABLE 15 December 31 2024 2023 $ Change % Change (dollars in millions) Commercial real estate $ 88 $ 42 $ 46 109.5 % Commercial and industrial 51 39 12 30.8 Commercial leases 3 3 — — Other 2 — 2 — Total commercial loans and leases 144 84 60 71.4 Direct installment 2 5 (3) (60.0) Residential mortgages 7 10 (3) (30.0) Indirect installment 2 2 — — Consumer lines of credit 4 6 (2) (33.3) Total consumer loans 15 23 (8) (34.8) Total non-performing loans and leases $ 159 $ 107 52 48.6 Other real estate owned 3 3 — — Total non-performing assets $ 162 $ 110 $ 52 47.3 % Non-performing loans / total loans and leases 0.47 % 0.33 % Non-performing loans plus OREO / total loans and leases plus OREO 0.48 0.34 Non-performing assets / total assets 0.33 0.24 Following is a summary of loans and leases 90 days or more past due on which interest accruals continue: TABLE 16 December 31 2024 2023 (dollars in millions) Total loans and leases 90 days or more past due $ 14 $ 12 As a percentage of total loans and leases 0.04 % 0.04 % Following is a table showing the amounts of contractual interest income and actual interest income related to non-performing loans: TABLE 17 December 31 2024 2023 2022 (in millions) Gross interest income: Per contractual terms $ 24 $ 14 $ 11 Recorded during the year — — — Loan Modifications During the period, there are loans whose contractual terms have been modified in a manner that grants a concession to a borrower experiencing financial difficulties.
Non-accrual loans of $105.2 million at December 31, 2025 decreased $54.3 million, or 34.0%, compared to December 31, 2024, attributed to a small number of commercial real estate loans, with both periods remaining at relatively low levels. 53 Table of Contents Following is a summary of non-performing loans and leases, by class, OREO and non-performing assets: TABLE 15 December 31 2025 2024 $ Change % Change (dollars in millions) Commercial real estate $ 45 $ 88 $ (43) (48.9) % Commercial and industrial 35 51 (16) (31.4) Commercial leases 3 3 — — Other 2 2 — — Total commercial loans and leases 85 144 (59) (41.0) Direct installment 4 2 2 100.0 Residential mortgages 12 7 5 71.4 Indirect installment 1 2 (1) (50.0) Consumer lines of credit 3 4 (1) (25.0) Total consumer loans 20 15 5 33.3 Total non-performing loans and leases 105 159 (54) (34.0) Other real estate owned 3 3 — — Total non-performing assets $ 108 $ 162 $ (54) (33.3) % Non-performing loans / total loans and leases 0.30 % 0.47 % Non-performing loans plus OREO / total loans and leases plus OREO 0.31 0.48 Non-performing assets / total assets 0.22 0.33 Following is a summary of loans and leases 90 days or more past due on which interest accruals continue: TABLE 16 December 31 2025 2024 (dollars in millions) Total loans and leases 90 days or more past due $ 13 $ 14 As a percentage of total loans and leases 0.04 % 0.04 % Following is a table showing the amounts of contractual interest income and actual interest income related to non-performing loans: TABLE 17 December 31 2025 2024 2023 (in millions) Gross interest income: Per contractual terms $ 20 $ 24 $ 14 Recorded during the year — — — Loan Modifications During the period, there are loans whose contractual terms have been modified in a manner that grants a concession to a borrower experiencing financial difficulties.
TABLE 34 Operating net income available to common shareholders Year Ended December 31 2024 2023 2022 (in thousands) Net income available to common shareholders $ 459,327 $ 476,810 $ 431,068 Preferred dividend at redemption 3,995 — — Merger-related expense — 2,215 45,259 Tax benefit of merger-related expense — (465) (9,504) Provision expense related to acquisitions — — 28,515 Tax benefit of provision expense related to acquisitions — — (5,988) Branch consolidation costs 1,194 — 7,016 Tax benefit of branch consolidation costs (251) — (1,473) FDIC special assessment 5,212 29,938 — Tax benefit of FDIC special assessment (1,095) (6,287) — Realized loss on investment securities restructuring 33,980 67,354 — Tax benefit of realized loss on investment securities restructuring (7,136) (14,144) — Software impairment 3,690 — — Tax benefit of software impairment (775) — — Loss related to indirect auto loan sales 8,969 16,687 — Tax benefit of loss related to indirect auto loan sales (1,883) (3,504) — Operating net income available to common shareholders (non-GAAP) $ 505,227 $ 568,604 $ 494,893 The table above shows how operating net income available to common shareholders (non-GAAP) is derived from amounts reported in our financial statements.
TABLE 33 Operating net income available to common shareholders Year Ended December 31 2025 2024 2023 (in thousands) Net income available to common shareholders $ 565,387 $ 459,327 $ 476,810 Preferred dividend at redemption — 3,995 — FNB Foundation contribution 20,000 — — Tax benefit of FNB Foundation contribution (4,200) — — Merger-related expense — — 2,215 Tax benefit of merger-related expense — — (465) Branch consolidation costs — 1,194 — Tax benefit of branch consolidation costs — (251) — FDIC special assessment (5,647) 5,212 29,938 Tax expense (benefit) of FDIC special assessment 1,186 (1,095) (6,287) Realized loss on investment securities restructuring — 33,980 67,354 Tax benefit of realized loss on investment securities restructuring — (7,136) (14,144) Software impairment — 3,690 — Tax benefit of software impairment — (775) — Loss related to indirect auto loan sales — 8,969 16,687 Tax benefit of loss related to indirect auto loan sales — (1,883) (3,504) Operating net income available to common shareholders (non-GAAP) $ 576,726 $ 505,227 $ 568,604 The table above shows how operating net income available to common shareholders (non-GAAP) is derived from amounts reported in our financial statements.
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.
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.
The variance percentages represent the change between the net interest income and EVE calculated under the particular rate scenario compared to the net interest income and EVE that was calculated assuming market rates as of December 31, 2024. The calculated results do not reflect management's potential actions.
The variance percentages represent the change between the net interest income and EVE calculated under the particular rate scenario compared to the net interest income and EVE that was calculated assuming market rates as of December 31, 2025.
Overall, asset quality metrics continue to remain at solid levels. Net charge-offs totaled $62.7 million, or 0.19% of total average loans, compared to $67.7 million, or 0.22%. • The ACL on loans and leases totaled $423 million at December 31, 2024, compared to $406 million with the increase reflecting net loan growth.
Overall, asset quality metrics continue to remain at solid levels, reflecting continued proactive management of the loan portfolio. Net charge-offs totaled $70.5 million, or 0.20% of total average loans, compared to $62.7 million, or 0.19%. • The ACL on loans and leases totaled $439 million at December 31, 2025, compared to $423 million with the increase reflecting net loan growth.
Operating net income available to common shareholders (non-GAAP) was $505.2 million, or $1.39 per diluted common share (non-GAAP), compared to operating net income available to common shareholders (non-GAAP) of $568.6 million, or $1.57 per diluted common share (non-GAAP).
Operating net income available to common shareholders (non-GAAP) was $576.7 million, or $1.59 per diluted common share (non-GAAP), compared to $505.2 million, or $1.39 per diluted common share (non-GAAP).
These costs are specific to each individual transaction and may vary significantly based on the size and complexity of the transaction. 40 Table of Contents To facilitate peer comparisons of net interest margin and efficiency ratio, we use net interest income on a taxable-equivalent basis in calculating net interest margin by increasing the interest income earned on tax-exempt assets (loans and investments) to make it fully equivalent to interest income earned on taxable investments (this adjustment is not permitted under GAAP).
To facilitate peer comparisons of net interest margin and efficiency ratio, we use net interest income on a taxable-equivalent basis in calculating net interest margin by increasing the interest income earned on tax-exempt assets (loans and investments) to make it fully equivalent to interest income earned on taxable investments (this adjustment is not permitted under GAAP).
Comparatively, net income available to common shareholders for 2023 totaled $476.8 million, or $1.31 per diluted common share. On an operating basis, 2024 earnings per diluted common share (non-GAAP) was $1.39, excluding $0.12 per diluted common share (non-GAAP) of significant items impacting earnings.
Comparatively, net income available to common shareholders for 2024 totaled $459.3 million, or $1.27 per diluted common share. On an operating basis, 2025 earnings per diluted common share (non-GAAP) was $1.59, excluding $0.03 per diluted common share (non-GAAP) of significant items impacting earnings.
Corporation and First National Bank of Pennsylvania Negative Stable Stable n/a - not applicable RISK MANAGEMENT As a financial institution, we take on a certain amount of risk in every business decision, transaction and activity.
Corporation and First National Bank of Pennsylvania Negative * Stable Stable n/a - not applicable * Moody's affirmed its ratings and changed the outlook from negative to stable on February 12, 2026. RISK MANAGEMENT As a financial institution, we take on a certain amount of risk in every business decision, transaction and activity.
In addition to the repricing gap analysis above, we model rate scenarios which move all rates gradually over twelve months (Rate Ramps). We also model rate scenarios which move all rates in an immediate and parallel fashion (Rate Shocks) and model scenarios that gradually change the shape of the yield curve.
We also model rate scenarios which move all rates in an immediate and parallel fashion (Rate Shocks) and model scenarios that gradually change the shape of the yield curve.
On February 15, 2024, we redeemed all our 7.25% Fixed Rate / Floating Rate Non-Cumulative Perpetual Preferred Stock, Series E, in the amount of $111 million. The preferred stock is no longer outstanding and dividends will no longer accrue on such securities.
The Inflation Reduction Act of 2022 requires a 1% excise tax on stock repurchases. In 2024, we redeemed all our 7.25% Fixed Rate / Floating Rate Non-Cumulative Perpetual Preferred Stock in the amount of $111 million. The preferred stock is no longer outstanding and dividends will no longer accrue on such securities.
Excluding significant items totaling $19.1 million in 2024 and $48.8 million in 2023, operating non-interest expense (non-GAAP) increased $75.7 million, or 8.7%. The variances in significant individual non-interest expense items between 2024 and 2023 are explained in the following paragraphs.
Excluding significant items totaling $14.4 million in 2025 and $19.1 million in 2024, operating non-interest expense (non-GAAP) increased $53.1 million, or 5.6%. The variances in significant individual non-interest expense items between 2025 and 2024 are explained in the following paragraphs.
Our ending ACL coverage ratio at both December 31, 2024 and December 31, 2023 was 1.25%. Total provision for credit losses during 2024 was $79.8 million, compared to $71.8 million for the same period in 2023. The year-over-year increase was driven primarily by loan growth and an increase in substandard commercial real estate loans.
Our ending ACL coverage ratio was 1.26% December 31, 2025 compared to 1.25% at December 31, 2024. Total provision for credit losses during 2025 was $86.0 million, compared to $79.8 million for the same period in 2024. The year-over-year increase was driven primarily by loan growth and net charge-offs.
For additional information relating to the allowance and provision for credit losses, refer to the Allowance for Credit Losses section of this MD&A. 48 Table of Contents Non-Interest Income The breakdown of non-interest income for the years 2022 through 2024 is presented in the following table: TABLE 7 2024 vs 2023 2023 vs 2022 (dollars in thousands) 2024 2023 $ Change % Change 2022 $ Change % Change Service charges $ 90,996 $ 81,892 $ 9,104 11.1 % $ 86,895 $ (5,003) (5.8) % Interchange and card transaction fees 51,539 52,752 (1,213) (2.3) 50,803 1,949 3.8 Trust services 45,576 42,490 3,086 7.3 39,033 3,457 8.9 Insurance commissions and fees 22,370 23,104 (734) (3.2) 24,253 (1,149) (4.7) Securities commissions and fees 31,005 27,734 3,271 11.8 23,715 4,019 16.9 Capital markets income 24,239 27,103 (2,864) (10.6) 35,295 (8,192) (23.2) Mortgage banking operations 27,380 20,692 6,688 32.3 20,646 46 0.2 Dividends on non-marketable equity securities 25,046 21,262 3,784 17.8 11,953 9,309 77.9 Bank owned life insurance 16,741 11,945 4,796 40.2 11,942 3 — Net securities gains (losses) (34,011) (67,432) 33,421 n/m 48 (67,480) n/m Other 15,514 12,790 2,724 21.3 18,970 (6,180) (32.6) Total non-interest income $ 316,395 $ 254,332 $ 62,063 24.4 % $ 323,553 $ (69,221) (21.4) % n/m - not meaningful Total non-interest income increased $62.1 million, or 24.4%.
For additional information relating to the allowance and provision for credit losses, refer to the Allowance for Credit Losses on Loans and Leases section of this MD&A. 47 Table of Contents Non-Interest Income The breakdown of non-interest income for the years 2023 through 2025 is presented in the following table: TABLE 7 2025 vs 2024 2024 vs 2023 (dollars in thousands) 2025 2024 $ Change % Change 2023 $ Change % Change Service charges $ 92,489 $ 90,996 $ 1,493 1.6 % $ 81,892 $ 9,104 11.1 % Interchange and card transaction fees 52,393 51,539 854 1.7 52,752 (1,213) (2.3) Trust services 47,849 45,576 2,273 5.0 42,490 3,086 7.3 Insurance commissions and fees 20,173 22,370 (2,197) (9.8) 23,104 (734) (3.2) Securities commissions and fees 35,699 31,005 4,694 15.1 27,734 3,271 11.8 Capital markets income 26,629 24,239 2,390 9.9 27,103 (2,864) (10.6) Mortgage banking operations 28,111 27,380 731 2.7 20,692 6,688 32.3 Dividends on non-marketable equity securities 23,521 25,046 (1,525) (6.1) 21,262 3,784 17.8 Bank owned life insurance 18,660 16,741 1,919 11.5 11,945 4,796 40.2 Net securities gains (losses) 58 (34,011) 34,069 n/m (67,432) 33,421 49.6 Other 23,710 15,514 8,196 52.8 12,790 2,724 21.3 Total non-interest income $ 369,292 $ 316,395 $ 52,897 16.7 % $ 254,332 $ 62,063 24.4 % n/m - not meaningful Total non-interest income for 2025 was a record level and increased $52.9 million, or 16.7%.
As of December 31, 2024, AFS securities comprised 47% of the total securities portfolio and HTM securities comprised 53% of the total securities portfolio. As of December 31, 2024 and 2023, we did not hold any trading securities.
As of December 31, 2025, AFS securities comprised 48% of the total securities portfolio and HTM 56 Table of Contents securities comprised 52% of the total securities portfolio. As of December 31, 2025 and 2024, we did not hold any trading securities.
Salaries and employee benefits increased $42.4 million, or 9.2%, primarily related to normal annual merit increases, higher production-related commissions given the strong non-interest income activity, strategic hiring associated with our focus to grow market share and continued investments in our risk management infrastructure, and elevated employer-paid healthcare costs.
Salaries and employee benefits increased $26.2 million, or 5.2%, due to normal annual merit increases, higher production-related commissions given the strong non-interest income activity, strategic hiring associated with our focus to grow market share and continued investments in our risk management infrastructure. Outside services increased $11.1 million, or 11.5%, due to higher volume-related technology and third-party costs.
The MCH is defined as the number of months of corporate expenses and dividends that can be covered by the existing cash on hand.
The LCR is defined as the sum of cash on hand plus projected cash inflows over the next 12 months divided by projected cash outflows over the next 12 months. The MCH is defined as the number of months of corporate expenses and dividends that can be covered by the existing cash on hand.
TABLE 41 Operating non-interest income Year Ended December 31 2024 2023 (dollars in thousands) Non-interest income $ 316,395 $ 254,332 Realized loss on investment securities restructuring 33,980 67,354 Operating non-interest income (non-GAAP) $ 350,375 $ 321,686 TABLE 42 Operating non-interest expense Year Ended December 31 2024 2023 (dollars in thousands) Non-interest expense $ 961,339 $ 915,436 Branch consolidations (1,194) — Merger-related — (2,215) FDIC special assessment (5,212) (29,938) Software impairment (3,690) — Loss related to indirect auto loan sales (8,969) (16,687) Operating non-interest expense (non-GAAP) $ 942,274 $ 866,596 73 Table of Contents Key Performance Indicator s TABLE 43 Efficiency ratio Year Ended December 31 2024 2023 2022 (dollars in thousands) Non-interest expense $ 961,339 $ 915,436 $ 826,392 Less: Amortization of intangibles (17,495) (20,116) (13,868) Less: OREO expense (996) (1,515) (1,692) Less: Merger-related expense — (2,215) (45,259) Less: Branch consolidation costs (1,194) — (7,016) Less: FDIC special assessment (5,212) (29,938) — Less: Software impairment (3,690) — — Less: Loss related to indirect auto loan sales (8,969) (16,687) — Less: Tax credit-related project impairment (10,397) — — Adjusted non-interest expense $ 913,386 $ 844,965 $ 758,557 Net interest income $ 1,280,443 $ 1,316,504 $ 1,119,780 Taxable equivalent adjustment 11,686 12,341 11,288 Non-interest income 316,395 254,332 323,553 Less: Net securities (gains) losses 34,011 67,432 (48) Adjusted net interest income (FTE) + non-interest income $ 1,642,535 $ 1,650,609 $ 1,454,573 Efficiency ratio (FTE) (non-GAAP) 55.61 % 51.19 % 52.15 %
TABLE 39 Operating non-interest income Year Ended December 31 2025 2024 2023 (in thousands) Non-interest income $ 369,292 $ 316,395 $ 254,332 Realized loss on investment securities restructuring — 33,980 67,354 Operating non-interest income (non-GAAP) $ 369,292 $ 350,375 $ 321,686 70 Table of Contents TABLE 40 Operating non-interest expense Year Ended December 31 2025 2024 2023 (in thousands) Non-interest expense $ 1,009,740 $ 961,339 $ 915,436 FNB Foundation contribution (20,000) — — Branch consolidation costs — (1,194) — Merger-related — — (2,215) FDIC special assessment 5,647 (5,212) (29,938) Software impairment — (3,690) — Loss related to indirect auto loan sales — (8,969) (16,687) Operating non-interest expense (non-GAAP) $ 995,387 $ 942,274 $ 866,596 TABLE 41 Efficiency ratio Year Ended December 31 2025 2024 2023 (dollars in thousands) Non-interest expense $ 1,009,740 $ 961,339 $ 915,436 Less: Amortization of intangibles (15,841) (17,495) (20,116) Less: OREO expense (1,334) (996) (1,515) Less: FNB Foundation contribution (20,000) — — Less: Merger-related expense — — (2,215) Less: Branch consolidation costs — (1,194) — Add (Less): FDIC special assessment 5,647 (5,212) (29,938) Less: Software impairment — (3,690) — Less: Loss related to indirect auto loan sales — (8,969) (16,687) Less: Tax credit-related project impairment (4,442) (10,397) — Adjusted non-interest expense $ 973,770 $ 913,386 $ 844,965 Net interest income $ 1,395,755 $ 1,280,443 $ 1,316,504 Taxable equivalent adjustment 12,307 11,686 12,341 Non-interest income 369,292 316,395 254,332 Less: Net securities (gains) losses (58) 34,011 67,432 Adjusted net interest income (FTE) + non-interest income $ 1,777,296 $ 1,642,535 $ 1,650,609 Efficiency ratio (FTE) (non-GAAP) 54.79 % 55.61 % 51.19 %
We reinvested proceeds from the sale of those investment securities with an average yield of 1.08% into investment securities with yields approximately 350 basis points higher with a similar duration and convexity profile.
We reinvested proceeds from the sale of those investment securities with an average yield of 1.41% into investment securities yielding 4.78% with a similar duration and convexity profile.
Net charge-offs were $62.7 million, or 0.19%, of total average loans, compared to $67.7 million, or 0.22%, in 2023. The ACL as a percentage of non-performing loans for the total portfolio decreased from 378% as of December 31, 2023 to 265% remaining at an adequate level as of December 31, 2024.
Net charge-offs were $70.5 million, or 0.20%, of total average loans, compared to $62.7 million, or 0.19%, in 2024. The ACL as a percentage of non-performing loans for the total portfolio increased from 265% as of December 31, 2024 to 418% as of December 31, 2025.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The information called for by this item is provided in the Market Risk section of MD&A, which is included in Item 7 of this Report, and is incorporated herein by reference. 74 Table of Contents
Biggest changeITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The information called for by this item is provided in the Market Risk section of MD&A, which is included in Item 7 of this Report, and is incorporated herein by reference. 71 Table of Contents

Other FNB 10-K year-over-year comparisons