Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 30, 2024

First Commonwealth Financial Corporation

(Exact name of registrant as specified in its charter)



Pennsylvania	001-11138	25-1428528
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

601 Philadelphia Street
Indiana,	PA	15701
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (724) 349-7220

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $1.00 par value	FCF	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 2.02			Results of Operations and Financial Condition

On January 30, 2024, First Commonwealth Financial Corporation (the “Company”) issued a press release announcing financial results for the three and twelve month periods ended December 31, 2023. A copy of this press release and the related earnings tables are furnished as Exhibit 99.1 to this report and incorporated herein by reference.


Item 7.01			Regulation FD Disclosure

On January 30, 2024, the Company announced a cash dividend of $0.125 per share of the Company’s common stock. The dividend declaration is included in the press release announcing financial results for the three and twelve month periods ended December 31, 2023. A copy of this press release is furnished as Exhibit 99.1 to this report and incorporated herein by reference.


Item 9.01			Financial Statements and Exhibits

Exhibits


99.1			Press Release announcing Fourth Quarter 2023 Financial Results and Declaration of Quarterly Dividend.
104			Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: January 30, 2024

FIRST COMMONWEALTH FINANCIAL CORPORATION

By:

/s/ James R. Reske

Name:

James R. Reske

Title:

Executive Vice President, Chief Financial Officer and Treasurer

Exhibit 99.1

FOR IMMEDIATE RELEASE

First Commonwealth Announces Fourth Quarter and Full Year 2023 Earnings; Declares Quarterly Dividend

Indiana, PA, January 30, 2024 - First Commonwealth Financial Corporation (NYSE: FCF) today announced financial results for the fourth quarter and full year of 2023.

Financial Summary


(dollars in thousands,	For the Three Months Ended									For the Years Ended
except per share data)	December 31,			September 30,			December 31,			December 31,			December 31,
	2023			2023			2022			2023			2022
Reported Results
Net income	$	44,827		$	39,231		$	35,733		$	157,063		$	128,181
Diluted earnings per share	$	0.44		$	0.38		$	0.38		$	1.54		$	1.37
Return on average assets	1.56		%	1.38		%	1.47		%	1.42		%	1.34		%
Return on average equity	14.11		%	12.46		%	13.61		%	12.80		%	11.99		%

Operating Results (non-GAAP)(1)
Core net income	$	44,964		$	39,611		$	36,750		$	172,697		$	129,561
Core diluted earnings per share	$	0.44		$	0.39		$	0.39		$	1.70		$	1.38
Core pre-tax pre-provision net revenue	$	55,028		$	55,652		$	55,289		$	221,505		$	183,038
Provision expense	$	(1,865)		$	5,885		$	9,120		$	14,813		$	21,106

Net charge-offs	$	16,338		$	3,976		$	2,014		$	30,152		$	7,137
Reserve build/(release)(2)	$	(16,619)		$	791		$	6,813		$	14,812		$	10,384
Core return on average assets (ROAA)	1.56		%	1.39		%	1.51		%	1.56		%	1.35		%
Core pre-tax pre-provision ROAA	1.91		%	1.95		%	2.28		%	2.00		%	1.91		%
Return on average tangible common equity	20.78		%	18.55		%	19.77		%	19.01		%	17.30		%
Core return on average tangible common equity	20.85		%	18.73		%	20.32		%	20.86		%	17.49		%
Core efficiency ratio	53.00		%	53.42		%	50.00		%	52.91		%	54.59		%
Net interest margin (FTE)	3.65		%	3.76		%	3.99		%	3.81		%	3.58		%

(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 2023 Highlights

•Record net income of $44.8 million and record diluted earnings per share of $0.44 represent an increase of $5.6 million, or $0.06 per share from the previous quarter and an increase of $9.1 million, or $0.06 per share from the fourth quarter of 2022

•Core pre-tax pre-provision net revenue (PPNR)(1) totaled $55.0 million, a decrease of $0.6 million from the previous quarter and a decrease of $0.3 million from the fourth quarter of 2022

•Total loans increased $63.7 million, or 2.8% annualized, from the previous quarter, driven by growth in the Equipment Finance and Commercial Construction portfolios

◦Average loans increased $89.9 million, or 4.0% annualized, from the previous quarter

•Average deposits increased $37.3 million, or 1.6% annualized, compared to the prior quarter

•Net interest income (FTE) of $96.1 million decreased $2.0 million from the previous quarter but increased $7.7 million from the fourth quarter of 2022

•Noninterest income (excluding $0.1 million losses on investment securities in 3Q 2023) of $24.3 million decreased $0.6 million from the previous quarter

•Noninterest expense (excluding $0.2 million and $0.4 million of merger related expenses in 4Q 2023 and 3Q 2023, respectively) of $65.0 million decreased $2.0 million from the previous quarter

•Total shareholders’ equity increased $73.7 million from the previous quarter due to a $42.3 million decrease in unrealized losses on available-for-sale (AFS) securities and interest rate swaps, and a $32.1 million increase in retained earnings

•Tangible book value per share grew 8.9% (not annualized) compared to the prior quarter to $9.09

Profitability

•Core return on average assets (ROAA) improved seventeen basis points to 1.56% compared to the previous quarter

•Core pre-tax pre-provision ROAA(1) for the quarter ended December 31, 2023 was 1.91% as compared to 1.95% in the prior quarter and 2.28% in the fourth quarter of 2022

•The net interest margin of 3.65% decreased 11 basis points from the prior quarter but increased 34 basis points from the fourth quarter of 2022

•The core efficiency ratio(1) of 53.00% decreased 42 basis points from the previous quarter but increased 301 basis points from the fourth quarter of 2022

Strong capital position

•Bank-level Common Equity Tier 1 Capital (CET1) ratio of 11.0%, which represents $420.2 million in excess capital above the regulatory “well capitalized” requirement of 6.5%

•A total of 73,184 shares at a weighted average price of $11.75 were repurchased during the fourth quarter of 2023 under the Company’s previously authorized share repurchase program. The remaining repurchase capacity under the current program was $17.4 million as of December 31, 2023

Asset quality

•The provision for credit losses was ($1.9) million, a decrease of $7.8 million compared to the previous quarter

•The allowance for credit losses as a percentage of end-of-period loans was 1.31%, as compared to 1.51% in the previous quarter

•Total nonperforming loans decreased $8.5 million from the previous quarter

•Net charge-offs on loans totaled $16.3 million, an increase of $12.4 million from the previous quarter

◦Approximately $12.0 million of the quarterly net charge-offs were loans specifically reserved for in previous quarters

◦Net charge-offs as a percentage of average loans outstanding was 0.72% in the fourth quarter of 2023 as compared to 0.18% in the previous quarter

Full Year 2023 Highlights

Franchise Growth

•On January 31, 2023, the company completed its planned expansion into Central and Eastern Pennsylvania with the acquisition of Centric Financial Corporation (Centric)

•Total loans grew $421.0 million, or 5.5% compared to the prior year (excluding $923.6 million of loans acquired in the Centric acquisition at close)

•Average deposits grew $308.8 million, or 3.8% compared to the prior year (excluding $692.7 million of average annualized deposits acquired in the Centric acquisition at close)

◦End of period deposits grew $429.8 million, or 5.4% compared to the prior year (excluding $757.0 million of deposits acquired in the Centric acquisition)

Earnings

•Record $157.1 million net income and $1.54 diluted earnings per share

◦Core net income(1) was $172.7 million, or $1.70 diluted earnings per share, compared to $129.6 million, or $1.38 diluted earnings per share in the prior year

•Core pre-tax pre-provision income(1) grew $38.5 million, or 21.0% from the prior year

•Operating leverage was positive for the year ended December 31, 2023

◦Core revenue(1) grew $71.5 million, or 17.4%, from the prior year

◦Core noninterest expense(1) increased $31.2 million, or 13.9%, from the prior year

Profitability

•The core efficiency ratio(1) improved 167 basis points to 52.91% compared to the prior year

•The return on average assets (ROAA) for the year ended December 31, 2023 was 1.42%

◦Core ROAA(1) for the year ended December 31, 2023 was 1.56% as compared to 1.35% in the prior year

◦Core pre-tax pre-provision ROAA(1) for the year ended December 31, 2023 was 2.00% as compared to 1.91% in the prior year

“I am proud of the progress we made as a company in 2023. We overcame a very challenging deposit gathering environment, expanded our retail franchise in Central PA and grew within our existing geographies to produce record core earnings per share of $1.70 with a core pre-tax, pre-provision ROAA of 2.00%,” stated T. Michael Price, President and CEO. “While the economic outlook remains uncertain going into 2024, we will remain focused on building on this positive momentum and continuing to live out our mission to improve the financial lives of our neighbors and their businesses.”

Earnings

Net income for the fourth quarter of 2023 was $44.8 million, or $0.44 per share, compared to $39.2 million, or $0.38 per share in the third quarter of 2023 and $35.7 million, or $0.38 per share for the fourth quarter of 2022.

Net income for the year ended December 31, 2023 was $157.1 million, or $1.54 per share, compared to $128.2 million, or $1.37 per share for the same period in 2022.

Net Interest Income and Net Interest Margin

Net interest income (FTE) of $96.1 million decreased $2.0 million from the previous quarter and increased $7.7 million from the prior year quarter. The increase from the previous quarter was primarily due to an 11 basis point decrease in the net interest margin, partially offset by a $90.8 million increase in average interest-earning assets.

The net interest margin for the fourth quarter of 2023 was 3.65%, a decrease of 11 basis points from the previous quarter and a decrease of 34 basis points from the fourth quarter of 2022. The total cost of deposits increased 23 basis points due to a $285.8 million increase in higher cost money market and time deposits and a decrease of $248.6 million in demand deposit and savings

accounts, partially offset by a 10 basis point increase in loan yields due to higher replacement yields on new loan volume and a $89.9 million increase in average loans.

Total average deposits increased $37.3 million, or 1.6% annualized in the fourth quarter of 2023 as compared to the previous quarter. Total end-of-period deposits decreased $48.8 million, or 2.1% annualized, from the previous quarter primarily due to a seasonal decline in public funds.

Asset Quality

Provision for credit losses totaled ($1.9) million in the fourth quarter of 2023 as compared to $5.9 million in the previous quarter. The decrease in provision expense during the quarter was primarily driven by lower unfunded commitments and improved qualitative factors, including in the company’s high risk portfolio.

Nonperforming loans totaled $39.5 million, a decrease of $8.5 million from the previous quarter and an increase of $4.0 million from the fourth quarter of 2022. Nonperforming loans represented 0.44% of total loans as compared to 0.54% and 0.46% for the periods ended September 30, 2023 and December 31, 2022, respectively.

At December 31, 2023, criticized loans totaled $210.2 million, an increase of $17.0 million from the previous quarter.

During the fourth quarter of 2023, net charge-offs were $16.3 million as compared to net charge-offs of $4.0 million in the previous quarter and $2.0 million in the fourth quarter of 2022. The increase from the prior quarter was driven by $8.2 million acquired loans with a combined specific reserve of $6.0 million and $4.3 million for a commercial real estate credit which was reserved for in prior periods.

Net charge-offs (annualized) as a percentage of average loans were 0.72%, 0.18% and 0.11% for the periods ended December 31, 2023, September 30, 2023 and December 31, 2022, respectively.

Noninterest Income and Noninterest Expense

Noninterest income (excluding gains and losses on investment securities) totaled $24.3 million for the fourth quarter of 2023, as compared to $24.9 million for the third quarter of 2023 and $24.3 million for the fourth quarter of 2022. The $0.6 million decrease from the previous quarter was primarily due to a $0.5 million decrease in gain on sale of Mortgage loans and a $0.4 million decrease in Trust income, partially offset by a $0.6 million increase in gain on sale of Small Business Administration (SBA) loans.

For the year ended December 31, 2023, noninterest income (excluding gains and losses on investment securities) totaled $96.7 million, a decrease of $2.0 million from the prior year. The decrease from the prior year was primarily due to a $3.2 million decrease in commercial swap fee income and a $1.3 million decrease in gain on sale of mortgage loans, partially offset by a $1.8 million increase in service charges on deposit accounts and a $1.0 million increase in card related interchange income.

There were $0.1 million of net security losses in 2023 and no material gains or losses in the prior year.

Noninterest expense (excluding merger related expenses) totaled $65.0 million for the fourth quarter of 2023, as compared to $67.0 million for the third quarter of 2023 and $57.1 million for the fourth quarter of 2022. The $2.0 million decrease from the previous quarter was primarily the result of a $1.2 million decrease in accrued Pennsylvania shares tax obligations and a $0.6 million decrease in advertising and promotion expenses, partially offset by a $0.6 million increase in salaries and benefits.

The core efficiency ratio was 53.00% during the fourth quarter of 2023 as compared to 53.42% in the previous quarter and 50.00% in the fourth quarter of 2022.

For the year ended December 31, 2023, noninterest expense (excluding merger related expenses) totaled $260.9 million, as compared to $227.9 million in the prior year. The $32.9 million increase from the prior year was primarily driven by higher operating expenses following the company’s acquisition of Centric on January 31, 2023.

The core efficiency ratio was 52.91% for the year ended December 31, 2023 as compared to 54.59% in the previous year.

Full time equivalent staff was 1,475 at December 31, 2023, 1,481 at September 30, 2023, and 1,424 at December 31, 2022.

Dividends and Capital

First Commonwealth Financial Corporation declared a common stock quarterly dividend of $0.125 per share, which represents a 4.2% increase from the fourth quarter of 2022. The cash dividend is payable on February 23, 2024 to shareholders of record as of February 9, 2024. This dividend represents a 3.3% projected annual yield utilizing the January 29, 2024 closing market price of $15.05.

First Commonwealth’s capital ratios for Total, Tier I, Leverage and Common Equity Tier I at December 31, 2023 were 13.9%, 11.9%, 10.0% and 11.2%, 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 2023 on Wednesday, January 31, 2024 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 126 community banking offices in 30 counties throughout western and central Pennsylvania and throughout Ohio, as well as commercial lending operations in Pittsburgh and Harrisburg, 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, and could be affected by many factors, including, but not limited to: (1) volatility and disruption in national and international financial markets; (2) the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board; (3) inflation, interest rate, commodity price, securities market and monetary fluctuations; (4) 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; (5) the soundness of other financial institutions; (6) political instability; (7) impairment of First Commonwealth’s goodwill or other intangible assets; (8) acts of God or of war or terrorism; (9) the timely development and acceptance of new products and services and perceived overall value of these products and services by users; (10) changes in consumer spending, borrowings and savings habits; (11) changes in the financial performance and/or condition of First Commonwealth’s borrowers; (12) technological changes; (13) acquisitions and integration of acquired businesses; (14) First Commonwealth’s ability to attract and retain qualified employees; (15) changes in the competitive environment in First Commonwealth’s markets and among banking organizations and other financial service providers; (16) the ability to increase market share and control expenses; (17) 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; (18) the reliability of First Commonwealth’s vendors, internal control systems or information systems; (19) 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 (20) 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.

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:

Ron Wahl

Communications and Media Relations

Phone: 724-463-6806

E-mail: RWahl@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 Ended									For the Years Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2023			2023			2022			2023			2022
SUMMARY RESULTS OF OPERATIONS
Net interest income	$	95,737		$	97,757		$	88,027		$	385,676		$	312,221
Provision for credit losses	(1,865)			5,885			9,120			4,160			21,106
Provision for credit losses — acquisition day 1 non-PCD	—			—			—			10,653			—
Noninterest income	24,297			24,826			24,309			96,609			98,708
Noninterest expense	65,180			67,413			58,334			269,917			229,638
Net income	44,827			39,231			35,733			157,063			128,181
Core net income (5)	44,964			39,611			36,750			172,697			129,561
Earnings per common share (diluted)	$	0.44		$	0.38		$	0.38		$	1.54		$	1.37
Core earnings per common share (diluted) (6)	$	0.44		$	0.39		$	0.39		$	1.70		$	1.38
KEY FINANCIAL RATIOS
Return on average assets	1.56		%	1.38		%	1.47		%	1.42		%	1.34		%
Core return on average assets (7)	1.56		%	1.39		%	1.51		%	1.56		%	1.35		%
Return on average assets, pre-provision, pre-tax	1.91		%	1.94		%	2.22		%	1.91		%	1.89		%
Core return on average assets, pre-provision, pre-tax	1.91		%	1.95		%	2.28		%	2.00		%	1.91		%
Return on average shareholders' equity	14.11		%	12.46		%	13.61		%	12.80		%	11.99		%
Return on average tangible common equity (8)	20.78		%	18.55		%	19.77		%	19.01		%	17.30		%
Core return on average tangible common equity (9)	20.85		%	18.73		%	20.32		%	20.86		%	17.49		%
Core efficiency ratio (2)(10)	53.00		%	53.42		%	50.00		%	52.91		%	54.59		%
Net interest margin (FTE) (1)	3.65		%	3.76		%	3.99		%	3.81		%	3.58		%

Book value per common share	$	12.87		$	12.14		$	11.27
Tangible book value per common share (11)	9.09			8.35			7.92
Market value per common share	15.44			12.21			13.97
Cash dividends declared per common share	0.125			0.125			0.120			0.495			0.475
ASSET QUALITY RATIOS
Nonperforming loans and leases as a percent of end-of-period loans and leases(3)	0.44		%	0.54		%	0.46		%

Nonperforming assets as a percent of total assets (3)	0.36		%	0.43		%	0.37		%

Net charge-offs as a percent of average loans and leases (annualized) (4)	0.72		%	0.18		%	0.11		%

Allowance for credit losses as a percent of nonperforming loans and leases (4)	298.23		%	280.31		%	289.98		%
Allowance for credit losses as a percent of end-of-period loans and leases (4)	1.31		%	1.51		%	1.35		%



CAPITAL RATIOS
Shareholders' equity as a percent of total assets	11.5		%	10.9		%	10.7		%
Tangible common equity as a percent of tangible assets (12)	8.4		%	7.7		%	7.8		%

Leverage Ratio	10.0		%	9.9		%	10.2		%
Risk Based Capital - Tier I	11.9		%	11.6		%	12.0		%
Risk Based Capital - Total	13.9		%	13.8		%	14.4		%
Common Equity - Tier I	11.2		%	10.9		%	11.1		%


FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands, except per share data)
	For the Three Months Ended						For the Years Ended
	December 31,		September 30,		December 31,		December 31,		December 31,
	2023		2023		2022		2023		2022
INCOME STATEMENT
Interest income	$	144,257	$	139,885	$	96,281	$	529,998	$	329,953
Interest expense	48,520		42,128		8,254		144,322		17,732


Net Interest Income	95,737		97,757		88,027		385,676		312,221
Provision for credit losses	(1,865)		5,885		9,120		4,160		21,106
Provision for credit losses - acquisition day 1 non-PCD	—		—		—		10,653		—
Net Interest Income after Provision for Credit Losses	97,602		91,872		78,907		370,863		291,115
Net securities gains	—		(103)		—		(103)		2
Trust income	2,549		2,949		2,455		10,516		10,518
Service charges on deposit accounts	5,595		5,600		4,946		21,437		19,641
Insurance and retail brokerage commissions	2,457		2,305		2,051		9,628		8,857
Income from bank owned life insurance	1,211		1,242		1,149		4,875		5,459
Gain on sale of mortgage loans	776		1,270		948		3,951		5,276
Gain on sale of other loans and assets	1,740		1,027		1,525		6,744		6,036
Card-related interchange income	7,218		7,221		6,996		28,640		27,603
Derivative mark-to-market	(13)		35		(27)		14		368
Swap fee income	490		452		752		1,519		4,685
Other income	2,274		2,828		3,514		9,388		10,263
Total Noninterest Income	24,297		24,826		24,309		96,609		98,708
Salaries and employee benefits	36,232		35,640		31,664		142,871		126,031
Net occupancy	4,637		4,782		4,451		19,221		18,037
Furniture and equipment	4,372		4,414		3,990		17,308		15,582
Data processing	3,986		3,857		3,543		15,010		13,922
Pennsylvania shares tax	351		1,588		960		4,364		4,447
Advertising and promotion	1,061		1,662		1,093		5,713		5,031

Intangible amortization	1,210		1,344		726		4,983		3,196

Other professional fees and services	1,543		1,603		1,272		5,919		4,894
FDIC insurance	1,646		1,920		675		6,260		2,871
Litigation and operational losses	1,378		1,626		847		4,641		2,834
Loss on sale or write-down of assets	107		50		128		204		343

Merger and acquisition	174		379		1,254		9,034		1,702



Other operating expenses	8,483		8,548		7,731		34,389		30,748
Total Noninterest Expense	65,180		67,413		58,334		269,917		229,638
Income before Income Taxes	56,719		49,285		44,882		197,555		160,185

Income tax provision	11,892		10,054		9,149		40,492		32,004
Net Income	$	44,827	$	39,231	$	35,733	$	157,063	$	128,181

Shares Outstanding at End of Period	102,114,664		102,184,652		93,376,314		102,114,664		93,376,314
Average Shares Outstanding Assuming Dilution	102,264,768		102,442,878		93,489,398		101,822,201		93,887,447


FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)

	December 31,		September 30,		December 31,
	2023		2023		2022
BALANCE SHEET (Period End)
Assets
Cash and due from banks	$	125,436	$	122,982	$	124,254
Interest-bearing bank deposits	21,557		214,088		29,990
Securities available for sale, at fair value	1,071,857		866,582		789,075
Securities held to maturity, at amortized cost	419,009		429,558		461,162
Loans held for sale	29,820		33,127		11,869

Loans and leases	8,968,761		8,901,725		7,642,143
Allowance for credit losses	(117,718)		(134,337)		(102,906)
Net loans and leases	8,851,043		8,767,388		7,539,237

Goodwill and other intangibles	386,535		387,328		312,533

Other assets	554,231		600,935		537,546
Total Assets	$	11,459,488	$	11,421,988	$	9,805,666

Liabilities and Shareholders' Equity
Noninterest-bearing demand deposits	$	2,388,533	$	2,535,704	$	2,670,508

Interest-bearing demand deposits	629,138		632,062		357,769
Savings deposits	4,886,781		4,928,607		4,572,183
Time deposits	1,287,857		1,144,692		405,009
Total interest-bearing deposits	6,803,776		6,705,361		5,334,961

Total deposits	9,192,309		9,241,065		8,005,469

Short-term borrowings	597,835		544,060		372,694
Long-term borrowings	186,757		187,017		181,224
Total borrowings	784,592		731,077		553,918


Other liabilities	168,313		209,315		194,205
Shareholders' equity	1,314,274		1,240,531		1,052,074
Total Liabilities and Shareholders' Equity	$	11,459,488	$	11,421,988	$	9,805,666


FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)


	For the Three Months Ended												For the Years Ended
	December 31,		Yield/		September 30,		Yield/		December 31,		Yield/		December 31,		Yield/		December 31,		Yield/
	2023		Rate		2023		Rate		2022		Rate		2023		Rate		2022		Rate
NET INTEREST MARGIN

Assets
Loans and leases (FTE)(1)(3)	$	8,974,613	5.89	%	$	8,884,731	5.79	%	$	7,491,352	4.76	%	$	8,714,770	5.64	%	$	7,172,624	4.23	%

Securities and interest-bearing bank deposits (FTE) (1)	1,465,962		3.06	%	1,465,069		2.85	%	1,286,561		2.08	%	1,437,000		2.74	%	1,567,266		1.78	%
Total Interest-Earning Assets (FTE) (1)	10,440,575		5.49	%	10,349,800		5.37	%	8,777,913		4.36	%	10,151,770		5.23	%	8,739,890		3.79	%
Noninterest-earning assets	961,555				957,258				863,049				940,083				835,343
Total Assets	$	11,402,130			$	11,307,058			$	9,640,962			$	11,091,853			$	9,575,233

Liabilities and Shareholders' Equity
Interest-bearing demand and savings deposits	$	5,540,364	1.90	%	$	5,581,623	1.67	%	$	4,884,236	0.29	%	$	5,508,182	1.46	%	$	4,970,835	0.11	%
Time deposits	1,217,356		3.81	%	1,054,216		3.48	%	345,749		0.57	%	972,735		3.28	%	352,622		0.34	%
Short-term borrowings	548,680		5.43	%	504,025		5.23	%	264,987		2.86	%	439,556		4.95	%	144,834		1.38	%
Long-term borrowings	186,860		5.75	%	187,122		5.94	%	181,333		4.96	%	186,687		5.45	%	181,724		4.96	%
Total Interest-Bearing Liabilities	7,493,260		2.57	%	7,326,986		2.28	%	5,676,305		0.58	%	7,107,160		2.03	%	5,650,015		0.31	%
Noninterest-bearing deposits	2,434,560				2,519,184				2,729,716				2,552,596				2,708,580
Other liabilities	213,492				211,447				193,685				205,224				147,871
Shareholders' equity	1,260,818				1,249,441				1,041,256				1,226,873				1,068,767
Total Noninterest-Bearing Funding Sources	3,908,870				3,980,072				3,964,657				3,984,693				3,925,218
Total Liabilities and Shareholders' Equity	$	11,402,130			$	11,307,058			$	9,640,962			$	11,091,853			$	9,575,233

Net Interest Margin (FTE) (annualized)(1)			3.65	%			3.76	%			3.99	%			3.81	%			3.58	%


FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)
	December 31,			September 30,			December 31,
	2023			2023			2022
Loan and Lease Portfolio Detail
Commercial Loan and Lease Portfolio:
Commercial, financial, agricultural and other	$	1,310,405		$	1,305,905		$	1,132,032

Commercial real estate	3,053,152			3,050,084			2,425,012
Equipment Finance loans and leases	232,944			190,116			79,674
Real estate construction	541,633			508,875			395,439
Total Commercial	5,138,134			5,054,980			4,032,157

Consumer Loan Portfolio:
Closed-end mortgages	1,926,254			1,915,506			1,682,092
Home equity lines of credit	490,622			499,275			512,577
Real estate construction	56,102			66,672			117,662
Total Real Estate - Consumer	2,472,978			2,481,453			2,312,331

Auto & RV loans	1,277,969			1,285,380			1,210,451
Direct installment	27,167			27,888			31,938
Personal lines of credit	49,355			48,718			51,514
Student loans	3,158			3,306			3,752
Total Other Consumer	1,357,649			1,365,292			1,297,655
Total Consumer Portfolio	3,830,627			3,846,745			3,609,986
Total Portfolio Loans and Leases	8,968,761			8,901,725			7,642,143
Loans held for sale	29,820			33,127			11,869
Total Loans and Leases	$	8,998,581		$	8,934,852		$	7,654,012


	December 31,			September 30,			December 31,
	2023			2023			2022
ASSET QUALITY DETAIL
Nonperforming Loans and Leases:
Loans and leases on nonaccrual basis *	$	24,997		$	25,902		$	29,045
Loans on nonaccrual basis - Centric acquisition	14,475			22,022			—


Troubled debt restructured loans on accrual basis *	—			—			6,442
Total Nonperforming Loans and Leases	$	39,472		$	47,924		$	35,487
Other real estate owned ("OREO")	422			765			534
Repossessions ("Repos")	1,024			762			454
Total Nonperforming Assets	$	40,918		$	49,451		$	36,475
Loans past due in excess of 90 days and still accruing	9,436			2,484			1,991
Classified loans and leases	87,056			66,272			44,447
Criticized loans and leases	210,187			193,192			132,863

Nonperforming assets as a percentage of total loans and leases, plus OREO and Repos (4)	0.46		%	0.56		%	0.48		%
Allowance for credit losses	$	117,718		$	134,337		$	102,906
*TDR's were eliminated as of January 1, 2023 as part of implementing ASU 2022-02, Financial Instruments Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures.


FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)


	For the Three Months Ended									For the Years Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2023			2023			2022			2023			2022
Net Charge-offs (Recoveries):
Commercial, financial, agricultural and other	$	9,951		$	1,664		$	444		$	18,701		$	1,967
Real estate construction	—			—			—			—			(9)
Commercial real estate	4,579			166			182			6,126			1,718
Residential real estate	58			247			32			314			152
Loans to individuals	1,750			1,899			1,356			5,011			3,309
Net Charge-offs	$	16,338		$	3,976		$	2,014		$	30,152		$	7,137

Net charge-offs as a percentage of average loans and leases outstanding (annualized) (4)	0.72		%	0.18		%	0.11		%	0.35		%	0.10		%

Provision for credit losses as a percentage of net charge-offs	(11.42)		%	148.01		%	452.83		%	13.80		%	295.73		%
Provision for credit losses	$	(1,865)		$	5,885		$	9,120		$	4,160		$	21,106


DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES
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.

(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 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 Ended						For the Years Ended
	December 31,		September 30,		December 31,		December 31,		December 31,
	2023		2023		2022		2023		2022

Interest income	$	144,257	$	139,885	$	96,281	$	529,998	$	329,953
Adjustment to fully taxable equivalent basis (1)	314		313		290		1,237		1,049
Interest income adjusted to fully taxable equivalent basis (non-GAAP)	144,571		140,198		96,571		531,235		331,002
Interest expense	48,520		42,128		8,254		144,322		17,732
Net interest income, (FTE) (1)	$	96,051	$	98,070	$	88,317	$	386,913	$	313,270


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 Ended									For the Years Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2023			2023			2022			2023			2022

Net Income	$	44,827		$	39,231		$	35,733		$	157,063		$	128,181
Intangible amortization	1,210			1,344			726			4,983			3,196
Tax benefit of amortization of intangibles	(254)			(282)			(152)			(1,046)			(671)
Net Income, adjusted for tax affected amortization of intangibles	$	45,783		$	40,293		$	36,307		$	161,000		$	130,706

Average Tangible Equity:
Total shareholders' equity	$	1,260,818		$	1,249,441		$	1,041,256		$	1,226,873		$	1,068,767
Less: intangible assets	386,896			387,782			312,634			380,016			313,451
Tangible Equity	873,922			861,659			728,622			846,857			755,316
Less: preferred stock	—			—			—			—			—
Tangible Common Equity	$	873,922		$	861,659		$	728,622		$	846,857		$	755,316

(8)Return on Average Tangible Common Equity	20.78		%	18.55		%	19.77		%	19.01		%	17.30		%


	For the Three Months Ended									For the Years Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2023			2023			2022			2023			2022

Core Net Income:
Total Net Income	$	44,827		$	39,231		$	35,733		$	157,063		$	128,181

Net securities gains	—			103			—			103			(2)
Tax benefit of net securities gains	—			(22)			—			(22)			—
Merger and acquisition related expenses	174			379			1,254			9,034			1,702
Tax benefit of merger and acquisition related expenses	(37)			(80)			(263)			(1,897)			(357)
COVID-19 related	—			—			33			—			151
Tax benefit of COVID-19 related	—			—			(7)			—			(32)
Provision for credit losses - acquisition day 1 non-PCD	—			—			—			10,653			—
Tax benefit of provision for credit losses - acquisition day 1 non-PCD	—			—			—			(2,237)			—
Branch consolidation related	—			—			—			—			(104)
Tax benefit of branch consolidation related expenses	—			—			—			—			22
(5) Core net income	$	44,964		$	39,611		$	36,750		$	172,697		$	129,561
Average Shares Outstanding Assuming Dilution	102,264,768			102,442,878			93,489,398			101,822,201			93,887,447
(6) Core Earnings per common share (diluted)	$	0.44		$	0.39		$	0.39		$	1.70		$	1.38

Intangible amortization	1,210			1,344			726			4,983			3,196
Tax benefit of amortization of intangibles	(254)			(282)			(152)			(1,046)			(671)
Core Net Income, adjusted for tax affected amortization of intangibles	$	45,920		$	40,673		$	37,324		$	176,634		$	132,086

(9) Core Return on Average Tangible Common Equity	20.85		%	18.73		%	20.32		%	20.86		%	17.49		%


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 Ended									For the Years Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2023			2023			2022			2023			2022
Core Return on Average Assets:
Total Net Income	$	44,827		$	39,231		$	35,733		$	157,063		$	128,181
Total Average Assets	11,402,130			11,307,058			9,640,962			11,091,853			9,575,233
Return on Average Assets	1.56		%	1.38		%	1.47		%	1.42		%	1.34		%

Core Net Income (5)	$	44,964		$	39,611		$	36,750		$	172,697		$	129,561
Total Average Assets	11,402,130			11,307,058			9,640,962			11,091,853			9,575,233
(7) Core Return on Average Assets	1.56		%	1.39		%	1.51		%	1.56		%	1.35		%


	For the Three Months Ended									For the Years Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2023			2023			2022			2023			2022
Core Efficiency Ratio:
Total Noninterest Expense	$	65,180		$	67,413		$	58,334		$	269,917		$	229,638
Adjustments to Noninterest Expense:


Intangible amortization	1,210			1,344			726			4,983			3,196

Merger and acquisition related	174			379			1,254			9,034			1,702
COVID-19 related	—			—			33			—			151

Branch consolidation related	—			—			—			—			(104)

Noninterest Expense - Core	$	63,796		$	65,690		$	56,321		$	255,900		$	224,693

Net interest income, (FTE)	$	96,051		$	98,070		$	88,317		$	386,913		$	313,270
Total noninterest income	24,297			24,826			24,309			96,609			98,708
Net securities gains	—			103			—			103			(2)
Total Revenue	120,348			122,999			112,626			483,625			411,976

Adjustments to Revenue:
Derivative mark-to-market	(13)			35			(27)			14			368
Total Revenue - Core	$	120,361		$	122,964		$	112,653		$	483,611		$	411,608

(10)Core Efficiency Ratio	53.00		%	53.42		%	50.00		%	52.91		%	54.59		%


FIRST COMMONWEALTH FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL DATA
Unaudited
(dollars in thousands)


DEFINITIONS AND RECONCILIATION OF NON-GAAP MEASURES

	December 31,			September 30,			December 31,
	2023			2023			2022
Tangible Equity:
Total shareholders' equity	$	1,314,274		$	1,240,531		$	1,052,074
Less: intangible assets	386,535			387,328			312,533
Tangible Equity	927,739			853,203			739,541
Less: preferred stock	—			—			—
Tangible Common Equity	$	927,739		$	853,203		$	739,541

Tangible Assets:
Total assets	$	11,459,488		$	11,421,988		$	9,805,666
Less: intangible assets	386,535			387,328			312,533
Tangible Assets	$	11,072,953		$	11,034,660		$	9,493,133



(12)Tangible Common Equity as a percentage of Tangible Assets	8.38		%	7.73		%	7.79		%


Shares Outstanding at End of Period	102,114,664			102,184,652			93,376,314
(11)Tangible Book Value Per Common Share	$	9.09		$	8.35		$	7.92


	For the Three Months Ended						For the Years Ended
	December 31,		September 30,		December 31,		December 31,		December 31,
	2023		2023		2022		2023		2022
Pre-tax pre-provision income:
Net interest income	$	95,737	$	97,757	$	88,027	$	385,676	$	312,221
Noninterest income	24,297		24,826		24,309		96,609		98,708
Noninterest expense	65,180		67,413		58,334		269,917		229,638
Pre-tax pre-provision income	$	54,854	$	55,170	$	54,002	$	212,368	$	181,291

Net securities gains	$	—	$	103	$	—	$	103	$	(2)
Merger and acquisition related expenses	174		379		1,254		9,034		1,702
COVID-19 related	—		—		33		—		151

Branch consolidation	—		—		—		—		(104)
Core pre-tax pre-provision income	$	55,028	$	55,652	$	55,289	$	221,505	$	183,038

Net charge-offs	$	16,338	$	3,976	$	2,014	$	30,152	$	7,137

Document and Entity Information Document and Entity Information	Jan. 30, 2024
Document Information [Line Items]
Entity Incorporation, State or Country Code	PA
Amendment Flag	false
Entity Registrant Name	FIRST COMMONWEALTH FINANCIAL CORP /PA/
Document Fiscal Year Focus	2023
Entity Address, State or Province	PA
Entity File Number	001-11138
Entity Tax Identification Number	25-1428528
Document Type	8-K
Entity Address, Address Line One	601 Philadelphia Street
Entity Address, City or Town	Indiana,
Entity Address, Postal Zip Code	15701
Document Period End Date	Jan. 30, 2024
City Area Code	724
Local Phone Number	349-7220
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Document Fiscal Period Focus	FY
Entity Central Index Key	0000712537
Title of 12(b) Security	Common Stock, $1.00 par value
Trading Symbol	FCF
Security Exchange Name	NYSE