EX-99.1 2 fcf-ex991_20220125x8k.htm EX-99.1 PRESS RELEASE Document
                                                
Exhibit 99.1

fcfimagea01.jpg                    
FOR IMMEDIATE RELEASE

First Commonwealth Announces Fourth Quarter and Full Year 2021 Earnings; Declares Quarterly Dividend

Indiana, PA, January 25, 2022 - First Commonwealth Financial Corporation (NYSE: FCF) today announced financial results for the fourth quarter and full year of 2021.

Financial Summary
(dollars in thousands,For the Three Months EndedFor the Year Ended
except per share data)December 31,September 30,December 31,December 31,December 31,
20212021202020212020
Reported Results
Net income $34,776$34,092$25,683$138,257$73,447
Diluted earnings per share$0.37$0.36$0.27$1.44$0.75
Return on average assets1.45 %1.42 %1.12 %1.47 %0.82 %
Return on average equity12.36 %12.14 %9.48 %12.55 %6.82 %
Operating Results (non-GAAP)(1)
Core net income$34,753$34,131$26,102$138,518$78,896
Core diluted earnings per share$0.37$0.36$0.27$1.45$0.81
Core pre-tax pre-provision net revenue$40,868$42,913$40,092$171,771$153,819
Provision expense($2,729)$330$7,680($1,376)$56,718
Net charge-offs($1,064)$2,277$4,825$8,410$17,193
Reserve build/(release)(2)
($1,663)($2,853)$13,002($8,787)$49,672
Core return on average assets (ROAA)1.45 %1.43 %1.14 %1.47 %0.88 %
Core pre-tax pre-provision ROAA1.71 %1.79 %1.75 %1.83 %1.71 %
Return on average tangible common equity17.56 %17.28 %13.80 %17.95 %10.06 %
Core return on average tangible common equity17.55 %17.30 %14.02 %17.98 %10.78 %
Core efficiency ratio57.06 %55.27 %56.00 %54.69 %56.28 %
Net interest margin (FTE)3.23 %3.23 %3.26 %3.26 %3.32 %
(1)Core operating results are a non-GAAP measure used by management to measure performance in operating the business that management believes enhances investors' ability to better understand the underlying business performance and trends related to core business activities. A full reconciliation of non-GAAP financial measures can be found at the end of the financial statements which accompany this release.
(2)Reserve build/(release) represents the net change in the Company's allowance for credit losses (ACL) from the prior period.
    
Fourth Quarter 2021 Highlights
•Net income of $34.8 million and diluted earnings per share totaled $0.37, an increase of $0.7 million, or $0.01 per share from the previous quarter and an increase of $9.1 million, or $0.10 per share from the fourth quarter of 2021

                                                
•Core pre-tax pre-provision net revenue (PPNR)(1) totaled $40.9 million, an increase of $0.8 million from the fourth quarter of 2020 and a decrease of $2.0 million from the previous quarter reflecting a decline of $1.7 million in Paycheck Protection Program (PPP) income from the prior quarter
•Total loans (excluding PPP loans) increased $186.1 million, or 11.2% annualized from the previous quarter, driven by both commercial and consumer categories
◦Average loans (excluding PPP loans) increased $141.9 million, or 8.6% annualized, from the previous quarter
•Total PPP loans decreased $80.8 million from the previous quarter resulting in a total PPP loan balance at December 31, 2021 of $71.3 million
•Net interest income (FTE) of $70.5 million decreased $0.4 million from the previous quarter due primarily to a $1.7 million decrease in income recognized on PPP loans
•Noninterest income of $26.1 million (excluding net security gains, which were immaterial) decreased $1.2 million from the previous quarter due primarily to a $1.7 million decrease in gain on sale of Mortgage loans
•Noninterest expense (excluding branch consolidation, early retirement and COVID-19 related expenses, which were immaterial) of $55.5 million increased $0.5 million from the previous quarter
•Average deposits decreased $33.1 million, or 1.6% annualized compared to the prior quarter, including $21.8 million of intentional time deposit runoff
◦End of period deposits grew $46.0 million, or 2.3% annualized, from the previous quarter
◦Average noninterest-bearing deposits grew $5.7 million, or 0.9% annualized, compared to the prior quarter
•Tangible book value per share grew 2.4% annualized compared to the prior quarter
•The Bank was named the #1 Small Business Association (SBA) lender in the SBA’s designated Pittsburgh District for the fiscal year ending September 30, 2021
Profitability
•Core return on average assets (ROAA) improved two basis points to 1.45% compared to the previous quarter and increased 31 basis points compared to the fourth quarter of 2020
•Core pre-tax pre-provision ROAA(1) for the quarter ended December 31, 2021 was 1.71% as compared to 1.79% in the prior quarter and 1.75% in the fourth quarter of 2020
•The net interest margin of 3.23% was unchanged from the prior quarter and decreased three basis points as compared to fourth quarter of 2020
•The core efficiency ratio(1) of 57.06% increased 179 basis points from the previous quarter
Strong capital and liquidity positions
•Bank-level Tier 1 Capital ratio of 11.8%, which represents $279.9 million in excess capital above the regulatory “well capitalized” requirement of 8.0%
•A total of 1,447,209 shares were purchased during the fourth quarter at a weighted average price of $14.62 under the company’s previously authorized share repurchase programs

                                                
•As previously announced on October 26, 2021, the Board of Directors authorized an additional $25 million share repurchase program. The remaining repurchase capacity under the current program was $20.0 million as of December 31, 2021
Asset quality
•The provision for credit losses was ($2.7) million, a decrease of $3.1 million compared to the previous quarter and a decrease of $10.4 million from the fourth quarter of 2020
•The allowance for credit losses as a percentage of end-of-period loans (excluding PPP loans) was 1.37% compared to 1.43% in the previous quarter
•Total criticized loans increased $2.3 million from the previous quarter
◦Total nonperforming assets increased $17.2 million from the previous quarter
•Net charge-offs on loans totaled ($1.1) million, a decrease of $3.3 million from the previous quarter
◦Net charge-offs as a percentage of average loans outstanding (excluding PPP loans, annualized) was (0.06%) in the fourth quarter of 2021 as compared to 0.14% in the previous quarter
Full Year 2021 Highlights
Franchise Growth
•Total loans grew $470.8 million, or 7.5% compared to the prior year (excluding PPP loans)
•Average deposits grew $461.6 million, or 6.3% compared to the prior year, including $479.0 million, or 22.8%, in average noninterest-bearing deposits
•Tangible book value per share grew 7.8% year-over-year
Earnings
•For the year ended December 31, 2021, net income was $138.3 million, or $1.44 diluted earnings per share
◦Core net income(1) was $138.5 million, or $1.45 diluted earnings per share, compared to $78.9 million, or $0.81 diluted earnings per share in the prior year
•Core pre-tax pre-provision income(1) grew $18.0 million, or 11.7% from the prior year
•Positive operating leverage for the year ending December 31, 2021
◦Core revenue(1) grew $17.4 million, or 4.7%, from the prior year
◦Core noninterest expense(1) increased $3.7 million, or 1.8%, from the prior year
Profitability
•The core efficiency ratio(1) improved 159 basis points to 54.69% compared to the prior year
•The return on average assets (ROAA) for the year ended December 31, 2021 was 1.47%
◦Core ROAA(1) for the year ended December 31, 2021 was 1.47% as compared to 0.88% in the prior year
◦Core pre-tax pre-provision ROAA(1) for the year ended December 31, 2021 was 1.83% as compared to 1.71% in the prior year

                                                
“Our results for the quarter and full year were strong, reflecting solid operating performance,” stated T. Michael Price, President and Chief Executive Officer. “Excluding PPP forgiveness, loans grew by 11.2% annualized since September with strong production in nearly all of our commercial and consumer portfolios.” Price continued, “As we look to the year ahead, we are genuinely excited about the core organic growth prospects of our company. The buildout of our Equipment Finance business is on pace and in line with our expectations. Our ongoing investments in talent, technology and our regional business model continue to position us well – all to the benefit of our clients, employees, communities and stockholders."
Earnings
Net income for the fourth quarter of 2021 was $34.8 million, or $0.37 per share, compared to $34.1 million, or $0.36 per share in the third quarter of 2021 and $25.7 million, or $0.27 per share for the fourth quarter of 2020.
Net income for the year ended December 31, 2021 was $138.3 million, or $1.44 per share, compared to $73.4 million, or $0.75 per share, for the same period in 2020.
Net Interest Income and Net Interest Margin
Net interest income (FTE) of $70.5 million decreased $0.4 million from the previous quarter and increased $2.7 million from the prior year quarter. The decrease from the previous quarter was primarily due to a $1.7 million decrease in fees recognized on PPP loans, partially offset by a $141.9 million increase in average loans (excluding PPP loans). Interest and fee income recognized on PPP loans totaled $4.0 million in the fourth quarter of 2021 as compared to $5.7 million in the prior quarter.
The net interest margin for the fourth quarter of 2021 was 3.23%, unchanged from the previous quarter and a decrease of three basis points from the fourth quarter of 2020. Loan yields (excluding PPP) decreased two basis points from the previous quarter due to the runoff of higher yielding loans offset by an $83.2 million increase in average interest earning assets (excluding PPP) and a three basis point increase in the yield on securities.
Total average deposits decreased $33.1 million in the fourth quarter of 2021 as compared to the previous quarter. Average noninterest bearing deposits grew $5.7 million and partially offset a $21.8 million decrease in average time deposits and a $17.0 million decrease in interest-bearing demand and savings deposits.
Total end-of-period deposits grew $46.0 million, or 2.3% annualized from the previous quarter.
Asset Quality
The Company adopted CECL on December 31, 2020, effective January 1, 2020.
Provision expense in the fourth quarter of 2021 totaled ($2.7) million as compared to $0.3 million in the previous quarter. The provision expense during the quarter reflected a $1.2 million decrease in qualitative reserves due to improved charge off history and a $0.6 million decrease in individually analyzed reserves, partially offset by a $0.3 million increase in quantitative reserves primarily due to strong quarterly loan growth.
Nonperforming loans totaled $55.2 million, an increase of $17.1 million from the previous quarter and an increase of $1.1 million the fourth quarter of 2020. The increase from the previous quarter was primarily due to a single commercial real estate relationship with two loans totaling $28.4 million which were downgraded to nonaccrual status during the quarter. At December 31, 2021, the relationship had sufficient collateral and did not require an associated individually assessed reserve.
Nonperforming loans represented 0.81% of total loans (excluding PPP loans) as compared to 0.58% and 0.86% for the periods ended September 30, 2021 and December 31, 2020, respectively.
At December 31, 2021, criticized loans totaled $198.1 million, an increase of $2.3 million from the previous quarter.

                                                
During the fourth quarter of 2021, net charge-offs were ($1.1) million due to recoveries on a previously charged off commercial loan relationship, as compared to net charge-offs of $2.2 million in the previous quarter and $4.8 million in the fourth quarter of 2020.
Net charge-offs as a percentage of average loans (excluding PPP, annualized) were (0.06%), 0.14% and 0.30% for the periods ended December 31, 2021, September 30, 2021 and December 31, 2020, respectively.
Noninterest Income and Noninterest Expense
Noninterest income (excluding net security gains) totaled $26.1 million for the fourth quarter of 2021, as compared to $27.2 million for the third quarter of 2021 and $26.6 million for the fourth quarter of 2020. The $1.1 million decrease from the previous quarter was primarily due to a $1.7 million decrease in gain on sale of Mortgage loans and a $0.7 million decrease in gain on sale of SBA loans, partially offset by an $0.8 million increase in swap derivative mark-to-market and a $0.5 million increase in swap fee income.
For the year ended December 31, 2021, noninterest income (excluding security gains) totaled $106.7 million, an increase of $12.3 million from the prior year. The increase from the prior year was due to an $4.9 million increase in swap derivative mark-to-market, a $4.0 million increase in card related interchange income, a $3.1 million increase in gain on sale of SBA loans, a $2.0 million increase in Trust income and a $1.6 million increase in service charges on deposit accounts, partially offset by a $5.3 million decrease in gain on sale of Mortgage loans.
There were no material security gains during 2021 or 2020.
Noninterest expense (excluding branch consolidation, early retirement and COVID-19 related expenses) totaled $55.5 million for the fourth quarter of 2021, as compared to $55.0 million for the third quarter of 2021 and $54.3 million for the fourth quarter of 2020. The $0.5 million increase from the previous quarter was primarily the result of a $0.4 million increase in salaries and employee benefits and a $0.3 million increase in contributions, partially offset by a $0.3 million decrease in FDIC insurance expense.
The core efficiency ratio was 57.06% during the fourth quarter of 2021 as compared to 55.27% in the previous quarter and 56.00% in the fourth quarter of 2020.
For the year ended December 31, 2021, noninterest expense (excluding branch consolidation, early retirement and COVID-19 related expenses) totaled $213.5 million, as compared to $208.9 million in the prior year. The $4.6 million increase from the prior year was primarily driven by a $1.8 million increase in incentives, a $1.8 million increase in data processing and a $1.2 million unfunded commitment reserve credit in the prior year, partially offset by a $1.1 million decrease in occupancy expense.
The core efficiency ratio was 54.69% for the year ended December 31, 2021 as compared to 56.28% in the previous year.
Full time equivalent staff was 1,426 at December 31, 2021, 1,409 at September 30, 2021, and 1,398 at December 31, 2020. The increase from the previous quarter was partially the result of new hires related to the company’s previously announced entry into the equipment finance business.
Dividends and Capital
First Commonwealth Financial Corporation declared a common stock quarterly dividend of $0.115 per share, which represents a 4.5% increase from the fourth quarter of 2020. The cash dividend is payable on February 18, 2022 to shareholders of record as of February 4, 2022. This dividend represents a 2.8% projected annual yield utilizing the January 24, 2021 closing market price of $16.60.
First Commonwealth’s capital ratios for Total, Tier I, Leverage and Common Equity Tier I at December 31, 2021 were 14.6%, 12.2%, 9.7% and 11.3%, respectively. First Commonwealth’s current capital levels exceed the fully phased-in Basel III capital requirements issued by U.S. bank regulators.

                                                
Conference Call
First Commonwealth will host a quarterly conference call to discuss its financial results for the fourth quarter and full year 2021 on Wednesday, January 26, 2022 at 2:00 PM (ET). The call can be accessed by dialing (toll free) 1-888-330-3181 conference ID # 4651379 or through the company’s web page, http://www.fcbanking.com/InvestorRelations. A replay of the call will be available approximately one hour following the conclusion of the conference by dialing 1-800-770-2030 and entering the conference ID # 4651379. A link to the webcast replay will also be accessible on the company’s webpage for 30 days.
About First Commonwealth Financial Corporation
First Commonwealth Financial Corporation (NYSE: FCF), headquartered in Indiana, Pennsylvania, is a financial services Company with 118 community banking offices in 26 counties throughout western and central Pennsylvania and throughout Ohio, as well as business banking operations in Pittsburgh, Pennsylvania, and Canton, Cleveland, Columbus and Cincinnati, Ohio. The Company also operates mortgage offices in Wexford, Pennsylvania, as well as Hudson, and Lewis Center, Ohio. First Commonwealth provides a full range of commercial banking, consumer banking, mortgage, equipment finance, wealth management and insurance products and services through its subsidiaries First Commonwealth Bank and First Commonwealth Insurance Agency. For more information about First Commonwealth or to open an account today, please visit www.fcbanking.com.
Forward-Looking Statements
Certain statements contained in this release that are not historical facts may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, notwithstanding that such statements are not specifically identified as such. In addition, certain statements may be contained in our future filings with the Securities and Exchange Commission, in press releases, and in oral and written statements made by us or with our approval that are not statements of historical fact and constitute “forward-looking statements” as well. These statements, which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of words such as “may,” “will,” “should,” “could,” “would,” “plan,” “believe,” “expect,” “anticipate,” “intend,” “estimate” or words of similar meaning. These forward-looking statements are subject to significant risks, assumptions and uncertainties, including uncertainties regarding the impact of the COVID-19 pandemic, and could be affected by many factors, including, but not limited to: (1) the effects of the COVID-19 pandemic on First Commonwealth and its customers; (2) volatility and disruption in national and international financial markets; (3) the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board; (4) inflation, interest rate, commodity price, securities market and monetary fluctuations; (5) the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which First Commonwealth or its customers must comply; (6) the soundness of other financial institutions; (7) political instability; (8) impairment of First Commonwealth’s goodwill or other intangible assets; (9) acts of God or of war or terrorism; (10) the timely development and acceptance of new products and services and perceived overall value of these products and services by users; (11) changes in consumer spending, borrowings and savings habits; (12) changes in the financial performance and/or condition of First Commonwealth’s borrowers; (13) technological changes; (14) acquisitions and integration of acquired businesses; (15) First Commonwealth’s ability to attract and retain qualified employees; (16) changes in the competitive environment in First Commonwealth’s markets and among banking organizations and other financial service providers; (17) the ability to increase market share and control expenses; (18) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters; (19) the reliability of First Commonwealth’s vendors, internal control systems or information systems; (20) the costs and effects of legal and regulatory developments, the resolution of legal proceedings or regulatory or other governmental inquiries, the results of regulatory examinations or reviews and the ability to obtain required regulatory approvals; and (21) other risks and uncertainties described in this report and in the other reports that we file with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K. Further, statements about the potential effects of the COVID-19 pandemic on our business, financial condition,

                                                
liquidity and results of operations may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond our control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on our customers, clients, third parties and us.
In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward-looking statements in this release. We undertake no obligation to publicly update or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise.





Media Relations:
Jonathan E. Longwill
Vice President / Communications and Media Relations
Phone: 724-463-6806
E-mail: JLongwill@fcbanking.com

Investor Relations:
Ryan M. Thomas
Vice President / Finance and Investor Relations
Phone: 724-463-1690
E-mail: RThomas1@fcbanking.com

                                                
FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands, except per share data)
For the Three Months EndedFor the Year Ended
December 31,September 30,December 31,December 31,December 31,
20212021202020212020
SUMMARY RESULTS OF OPERATIONS
Net interest income$70,254 $70,645 $67,492 $278,541 $268,271 
Provision for credit losses(2,729)330 7,680 (1,376)56,718 
Noninterest income26,071 27,245 26,622 106,757 94,476 
Noninterest expense55,428 55,027 54,552 213,857 215,826 
Net income 34,776 34,092 25,683 138,257 73,447 
Core net income (5)
34,753 34,131 26,102 138,518 78,896 
Earnings per common share (diluted)$0.37 $0.36 $0.27 $1.44 $0.75 
Core earnings per common share (diluted) (6)
$0.37 $0.36 $0.27 $1.45 $0.81 
KEY FINANCIAL RATIOS
Return on average assets1.45 %1.42 %1.12 %1.47 %0.82 %
Core return on average assets (7)
1.45 %1.43 %1.14 %1.47 %0.88 %
Return on average assets, pre-provision, pre-tax1.71 %1.79 %1.73 %1.82 %1.64 %
Core return on average assets, pre-provision, pre-tax1.71 %1.79 %1.75 %1.83 %1.71 %
Return on average shareholders' equity12.36 %12.14 %9.48 %12.55 %6.82 %
Return on average tangible common equity (8)
17.56 %17.28 %13.80 %17.95 %10.06 %
Core return on average tangible common equity (9)
17.55 %17.30 %14.02 %17.98 %10.78 %
Core efficiency ratio (2)(10)
57.06 %55.27 %56.00 %54.69 %56.28 %
Net interest margin (FTE) (1)
3.23 %3.23 %3.26 %3.26 %3.32 %
Book value per common share$11.77 $11.69 $11.12 
Tangible book value per common share (11)
8.43 8.38 7.82 
Market value per common share16.09 13.63 10.94 
Cash dividends declared per common share0.115 0.115 0.110 0.455 0.440 
ASSET QUALITY RATIOS
Nonperforming loans as a percent of end-of-period loans (3)
0.80 %0.56 %0.80 %
Nonperforming loans as a percent of end-of-period loans, excluding PPP loans (3)
0.81 %0.58 %0.86 %
Nonperforming assets as a percent of total assets (3)
0.59 %0.41 %0.62 %
Nonperforming assets as a percent of total assets, excluding PPP loans (3)
0.59 %0.42 %0.65 %
Net charge-offs as a percent of average loans (annualized) (4)
(0.06)%0.13 %0.28 %
Net charge-offs as a percent of average loans, excluding PPP loans (annualized) (4)
(0.06)%0.14 %0.30 %
Allowance for credit losses as a percent of nonperforming loans (4)
167.67 %247.30 %187.43 %
Allowance for credit losses as a percent of end-of-period loans (4)
1.35 %1.40 %1.50 %
Allowance for credit losses as a percent of end-of-period loans, excluding PPP loans (4)
1.37 %1.43 %1.61 %
CAPITAL RATIOS
Shareholders' equity as a percent of total assets11.6 %11.7 %11.8 %
Tangible common equity as a percent of tangible assets (12)
8.6 %8.7 %8.6 %
Tangible common equity as a percent of tangible assets, excluding PPP loans (12)
8.7 %8.9 %9.1 %
Leverage Ratio9.7 %9.6 %9.4 %
Risk Based Capital - Tier I12.2 %12.4 %12.2 %
Risk Based Capital - Total14.6 %15.0 %14.9 %
Common Equity - Tier I11.3 %11.5 %11.2 %


                                                
FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands, except per share data)
For the Three Months EndedFor the Year Ended
December 31,September 30,December 31,December 31,December 31,
20212021202020212020
INCOME STATEMENT
   Interest income$73,530 $74,196 $73,306 $293,838 $301,209 
   Interest expense3,276 3,551 5,814 15,297 32,938 
Net Interest Income70,254 70,645 67,492 278,541 268,271 
   Provision for credit losses(2,729)330 7,680 (1,376)56,718 
Net Interest Income after Provision for Credit Losses72,983 70,315 59,812 279,917 211,553 
   Net securities gains— — 23 16 70 
   Trust income2,771 3,118 2,327 11,111 9,101 
   Service charges on deposit accounts4,857 4,770 4,321 17,984 16,387 
   Insurance and retail brokerage commissions2,134 2,218 1,868 8,502 7,850 
   Income from bank owned life insurance1,487 1,486 1,589 6,433 6,552 
   Gain on sale of mortgage loans1,940 3,485 5,538 13,555 18,764 
   Gain on sale of other loans and assets1,849 2,480 1,676 8,130 4,827 
   Card-related interchange income7,069 7,052 6,377 27,954 23,966 
Derivative mark-to-market973 218 (399)2,344 (2,521)
Swap fee income828 317 724 2,543 1,588 
   Other income2,163 2,101 2,578 8,185 7,892 
Total Noninterest Income26,071 27,245 26,622 106,757 94,476 
   Salaries and employee benefits31,422 31,066 31,388 119,506 118,961 
   Net occupancy3,972 3,960 3,668 16,586 17,647 
   Furniture and equipment 3,776 4,052 3,925 15,642 15,393 
   Data processing2,933 3,196 2,739 12,373 10,543 
   Pennsylvania shares tax1,257 1,257 1,254 4,604 4,500 
   Advertising and promotion 1,154 1,150 879 4,983 4,679 
   Intangible amortization900 868 897 3,497 3,689 
   Other professional fees and services1,351 1,308 1,131 4,501 3,886 
   FDIC insurance565 830 1,062 2,529 2,699 
   Litigation and operational losses700 589 373 2,324 1,411 
   Loss on sale or write-down of assets80 171 264 303 680 
   COVID-19 related92 50 307 449 874 
   Voluntary early retirement— — 118 — 3,422 
   Branch consolidation(121)— 128 (103)2,672 
   Other operating expenses7,347 6,530 6,419 26,663 24,770 
Total Noninterest Expense55,428 55,027 54,552 213,857 215,826 
Income before Income Taxes43,626 42,533 31,882 172,817 90,203 
   Income tax provision 8,850 8,441 6,199 34,560 16,756 
Net Income$34,776 $34,092 $25,683 $138,257 $73,447 
Shares Outstanding at End of Period94,233,15295,209,68596,130,75194,233,15296,130,751
Average Shares Outstanding Assuming Dilution95,020,35395,892,30496,344,39895,840,28597,758,965


                                                
FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)
December 31,September 30,December 31,
202120212020
BALANCE SHEET (Period End)
Assets
   Cash and due from banks$84,738 $94,579 $100,009 
   Interest-bearing bank deposits310,634 240,095 256,572 
   Securities available for sale, at fair value1,054,218 1,137,675 843,450 
   Securities held to maturity, at amortized cost541,311 548,057 361,844 
   Loans held for sale18,583 19,925 33,436 
     Loans6,839,230 6,732,580 6,761,183 
     Allowance for credit losses(92,522)(94,185)(101,309)
   Net loans6,746,708 6,638,395 6,659,874 
   Goodwill and other intangibles314,516 315,092 316,820 
   Other assets474,385 484,036 496,099 
Total Assets$9,545,093 $9,477,854 $9,068,104 
Liabilities and Shareholders' Equity
   Noninterest-bearing demand deposits$2,658,782 $2,656,229 $2,319,958 
     Interest-bearing demand deposits291,476 265,782 250,353 
     Savings deposits4,647,197 4,609,393 4,305,391 
     Time deposits385,043 405,081 562,964 
   Total interest-bearing deposits5,323,716 5,280,256 5,118,708 
   Total deposits7,982,498 7,936,485 7,438,666 
     Short-term borrowings138,315 117,754 117,373 
     Long-term borrowings182,269 182,519 233,255 
   Total borrowings320,584 300,273 350,628 
   Other liabilities132,639 128,241 210,193 
   Shareholders' equity1,109,372 1,112,855 1,068,617 
Total Liabilities and Shareholders' Equity$9,545,093 $9,477,854 $9,068,104 



                                                
FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)
For the Three Months EndedFor the Year Ended
December 31,Yield/September 30,Yield/December 31,Yield/December 31,Yield/December 31,Yield/
2021Rate2021Rate2020Rate2021Rate2020Rate
NET INTEREST MARGIN
Assets
Loans, excluding PPP loans (FTE)(1)(3)
$6,680,346 3.73 %$6,538,477 3.75 %$6,387,174 3.90 %$6,464,446 3.80 %$6,354,749 4.16 %
PPP Loans111,544 14.44 %225,262 10.05 %548,279 4.00 %312,746 7.41 %382,590 3.16 %
Securities and interest-bearing bank deposits (FTE) (1)
1,878,755 1.46 %1,937,385 1.43 %1,340,756 1.62 %1,809,417 1.46 %1,390,804 1.89 %
Total Interest-Earning Assets (FTE) (1)
8,670,645 3.38 %8,701,124 3.39 %8,276,209 3.54 %8,586,609 3.43 %8,128,143 3.72 %
Noninterest-earning assets815,872 801,377 845,094 807,455 846,437 
Total Assets$9,486,517 $9,502,501 $9,121,303 $9,394,064 $8,974,580 
Liabilities and Shareholders' Equity
Interest-bearing demand and savings deposits$4,882,318 0.06 %$4,899,328 0.07 %$4,603,255 0.14 %$4,812,004 0.07 %$4,552,211 0.26 %
Time deposits395,444 0.31 %417,274 0.36 %609,350 1.05 %449,452 0.49 %726,702 1.40 %
Short-term borrowings126,695 0.07 %118,112 0.06 %131,806 0.10 %119,801 0.08 %142,634 0.49 %
Long-term borrowings182,371 4.91 %182,623 4.92 %233,352 4.37 %200,961 4.70 %233,701 4.39 %
Total Interest-Bearing Liabilities5,586,828 0.23 %5,617,337 0.25 %5,577,763 0.41 %5,582,218 0.27 %5,655,248 0.58 %
Noninterest-bearing deposits2,652,812 2,647,089 2,313,009 2,580,460 2,101,412 
Other liabilities130,373 124,286 152,396 130,007 140,612 
Shareholders' equity1,116,504 1,113,789 1,078,135 1,101,379 1,077,308 
Total Noninterest-Bearing Funding Sources3,899,689 3,885,164 3,543,540 3,811,846 3,319,332 
Total Liabilities and Shareholders' Equity$9,486,517 $9,502,501 $9,121,303 $9,394,064 $8,974,580 
Net Interest Margin (FTE) (annualized)(1)
3.23 %3.23 %3.26 %3.26 %3.32 %


                                                
FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)
December 31,September 30,December 31,
202120212020
Loan Portfolio Detail
Commercial Loan Portfolio:
Commercial, financial, agricultural and other$1,102,154 $1,072,489 $1,077,132 
Paycheck Protection Program71,298 152,102 478,854 
Commercial real estate2,251,097 2,231,890 2,211,569 
Real estate construction382,764 318,120 340,850 
Total Commercial3,807,313 3,774,601 4,108,405 
Consumer Loan Portfolio:
Closed-end mortgages1,368,816 1,311,052 1,165,951 
Home equity lines of credit551,434 564,323 584,641 
Real estate construction111,692 105,896 86,371 
Total Real Estate - Consumer2,031,942 1,981,271 1,836,963 
Auto loans901,280 886,367 712,800 
Direct installment40,937 32,509 36,165 
Personal lines of credit52,809 52,667 61,072 
Student loans4,949 5,165 5,778 
Total Other Consumer999,975 976,708 815,815 
Total Consumer Portfolio3,031,917 2,957,979 2,652,778 
Total Portfolio Loans6,839,230 6,732,580 6,761,183 
Loans held for sale18,583 19,925 33,436 
Total Loans$6,857,813 $6,752,505 $6,794,619 
December 31,September 30,December 31,
202120212020
ASSET QUALITY DETAIL
Nonperforming Loans:
Loans on nonaccrual basis$34,926 $14,466 $30,801 
Loans held for sale on a nonaccrual basis— — 13 
Troubled debt restructured loans on nonaccrual basis13,134 16,210 14,740 
Troubled debt restructured loans on accrual basis7,120 7,410 8,512 
       Total Nonperforming Loans$55,180 $38,086 $54,066 
Other real estate owned ("OREO")642 502 1,215 
Repossessions ("Repos")397 453 613 
       Total Nonperforming Assets$56,219 $39,041 $55,894 
Loans past due in excess of 90 days and still accruing1,606 1,135 1,523 
Classified loans77,563 58,780 76,179 
Criticized loans198,126 195,791 302,813 
Nonperforming assets as a percentage of total loans, plus OREO and Repos (4)
0.82 %0.58 %0.83 %
Allowance for credit losses$92,522 $94,185 $101,309 

                                                
FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)
For the Three Months EndedFor the Year Ended
December 31,September 30,December 31,December 31,December 31,
20212021202020212020
Net Charge-offs (Recoveries):
       Commercial, financial, agricultural and other$(1,633)$1,960 $1,027 $4,590 $6,004 
       Real estate construction(11)— — (146)(26)
       Commercial real estate(5)12 2,364 1,524 4,627 
       Residential real estate20 (87)5 (159)626 
       Loans to individuals565 392 1,429 2,601 5,962 
Net Charge-offs$(1,064)$2,277 $4,825 $8,410 $17,193 
Net charge-offs as a percentage of average loans outstanding (annualized) (4)
(0.06)%0.13 %0.28 %0.12 %0.26 %
Net charge-offs as a percentage of average loans outstanding, excluding PPP loans (annualized) (4)
(0.06)%0.14 %0.30 %0.13 %0.27 %
Provision for credit losses as a percentage of net charge-offs256.48 %14.49 %159.17 %(16.36)%329.89 %
Provision for credit losses$(2,729)$330 $7,680 $(1,376)$56,718 
DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES
(1) Net interest income has been computed on a fully taxable equivalent basis ("FTE") using the federal income tax statutory rate of 21%.
(2) Core efficiency ratio excludes from total revenue the impact of derivative mark-to-market and excludes from "total noninterest expense" the amortization of intangibles, unfunded commitment expense and any other unusual items deemed by management to not be related to normal operations, such as merger, acquisition and severance costs.
(3) Includes held for sale loans.
(4) Excludes held for sale loans.
For the Three Months EndedFor the Year Ended
December 31,September 30,December 31,December 31,December 31,
20212021202020212020
Interest income$73,530 $74,196 $73,306 $293,838 $301,209 
Adjustment to fully taxable equivalent basis (1)
266 235 333 1,100 1,462 
Interest income adjusted to fully taxable equivalent basis (non-GAAP)73,796 74,431 73,639 294,938 302,671 
Interest expense3,276 3,551 5,814 15,297 32,938 
Net interest income, (FTE) (1)
$70,520 $70,880 $67,825 $279,641 $269,733 


                                                
FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands, except per share data)
DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES
For the Three Months EndedFor the Year Ended
December 31,September 30,December 31,December 31,December 31,
20212021202020212020
Net Income$34,776 $34,092 $25,683 $138,257 $73,447 
Intangible amortization900 868 897 3,497 3,689 
Tax benefit of amortization of intangibles(189)(182)(188)(734)(775)
Net Income, adjusted for tax affected amortization of intangibles$35,487 $34,778 $26,392 $141,020 $76,361 
Average Tangible Equity:
   Total shareholders' equity$1,116,504 $1,113,789 $1,078,135 $1,101,379 $1,077,308 
   Less: intangible assets314,860 315,303 317,178 315,589 318,155 
       Tangible Equity801,644 798,486 760,957 785,790 759,153 
   Less: preferred stock— — — — — 
       Tangible Common Equity$801,644 $798,486 $760,957 $785,790 $759,153 
(8)Return on Average Tangible Common Equity
17.56 %17.28 %13.80 %17.95 %10.06 %
For the Three Months EndedFor the Year Ended
December 31,September 30,December 31,December 31,December 31,
20212021202020212020
Core Net Income:
Total Net Income$34,776 $34,092 $25,683 $138,257 $73,447 
Net securities gains— — (23)(16)(70)
Tax benefit of net securities gains— — 5 3 15 
   COVID-19 related92 50 307 449 874 
Tax benefit of COVID 19 related(19)(11)(64)(94)(184)
Early retirement related— — 118 — 3,422 
Tax benefit of early retirement related expenses— — (25)— (719)
Branch consolidation related(121)— 128 (103)2,672 
Tax benefit of bank consolidation related expenses25 — (27)22 (561)
(5) Core net income
$34,753 $34,131 $26,102 $138,518 $78,896 
Average Shares Outstanding Assuming Dilution95,020,35395,892,30496,344,39895,840,28597,758,965
(6) Core Earnings per common share (diluted)
$0.37 $0.36 $0.27 $1.45 $0.81 
Intangible amortization900 868 897 3,497 3,689 
Tax benefit of amortization of intangibles(189)(182)(188)(734)(775)
Core Net Income, adjusted for tax affected amortization of intangibles$35,464 $34,817 $26,811 $141,281 $81,810 
(9) Core Return on Average Tangible Common Equity
17.55 %17.30 %14.02 %17.98 %10.78 %


                                                
FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands, except per share data)
DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES
  
For the Three Months EndedFor the Year Ended
December 31,September 30,December 31,December 31,December 31,
20212021202020212020
Core Return on Average Assets:
Total Net Income$34,776 $34,092 $25,683 $138,257 $73,447 
Total Average Assets9,486,517 9,502,501 9,121,303 9,394,064 8,974,580 
Return on Average Assets1.45 %1.42 %1.12 %1.47 %0.82 %
Core Net Income (5)
$34,753 $34,131 $26,102 $138,518 $78,896 
Total Average Assets9,486,517 9,502,501 9,121,303 9,394,064 8,974,580 
(7) Core Return on Average Assets
1.45 %1.43 %1.14 %1.47 %0.88 %
For the Three Months EndedFor the Year Ended
December 31,September 30,December 31,December 31,December 31,
20212021202020212020
Core Efficiency Ratio:
Total Noninterest Expense$55,428 $55,027 $54,552 $213,857 $215,826 
Adjustments to Noninterest Expense:
Unfunded commitment reserve— — — — (1,181)
Intangible amortization900 868 897 3,497 3,689 
   COVID-19 related92 50 307 449 874 
Early retirement related— — 118 — 3,422 
Branch consolidation related(121)— 128 (103)2,672 
Noninterest Expense - Core$54,557 $54,109 $53,102 $210,014 $206,350 
Net interest income, (FTE)$70,520 $70,880 $67,825 $279,641 $269,733 
Total noninterest income26,071 27,245 26,622 106,757 94,476 
Net securities gains— — (23)(16)(70)
Total Revenue96,591 98,125 94,424 386,382 364,139 
Adjustments to Revenue:
Derivative mark-to-market973 218 (399)2,344 (2,521)
Total Revenue - Core$95,618 $97,907 $94,823 $384,038 $366,660 
(10)Core Efficiency Ratio
57.06 %55.27 %56.00 %54.69 %56.28 %


                                                
FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)
DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES
December 31,September 30,December 31,
202120212020
Tangible Equity:
   Total shareholders' equity$1,109,372 $1,112,855 $1,068,617 
   Less: intangible assets314,516 315,092 316,820 
       Tangible Equity794,856 797,763 751,797 
   Less: preferred stock— — — 
       Tangible Common Equity$794,856 $797,763 $751,797 
Tangible Assets:
   Total assets $9,545,093 $9,477,854 $9,068,104 
   Less: intangible assets314,516 315,092 316,820 
       Tangible Assets$9,230,577 $9,162,762 $8,751,284 
Less: PPP loans71,298 152,102 478,854 
       Tangible Assets, excluding PPP loans$9,159,279 $9,010,660 $8,272,430 
(12)Tangible Common Equity as a percentage of Tangible Assets
8.61 %8.71 %8.59 %
(12)Tangible Common Equity as a percentage of Tangible Assets, excluding PPP loans
8.68 %8.85 %9.09 %
   Shares Outstanding at End of Period94,233,152 95,209,685 96,130,751 
(11)Tangible Book Value Per Common Share
$8.43 $8.38 $7.82 
Note: Management believes that it is standard practice in the banking industry to present these non-GAAP measures. These measures provide useful information to management and investors by allowing them to make peer comparisons.
For the Three Months EndedFor the Year Ended
December 31,September 30,December 31,December 31,December 31,
20212021202020212020
Pre-tax pre-provision income:
Net interest income$70,254$70,645$67,492$278,541$268,271
Noninterest income26,07127,24526,622106,75794,476
Noninterest expense55,42855,02754,552213,857215,826
Pre-tax pre-provision income$40,897$42,863$39,562$171,441$146,921
   Net securities gains$—$—($23)($16)($70)
   COVID-19 related9250307449874
   Voluntary early retirement——118—3,422
   Branch consolidation(121)—128(103)2,672
Core pre-tax pre-provision income$40,868$42,913$40,092$171,771$153,819
Net charge-offs($1,064)$2,277$4,825$8,410$17,193