third quarter of 2026
Filed Oct 27, 2026First Commonwealth Announces Third Quarter 2026 Earnings; Declares Quarterly Dividend and Announces Additional Share Repurchase Authorization
Third-quarter earnings, net interest income and net interest margin improved from both comparison periods, while the provision for credit losses, nonperforming loans and core expense increased and capital ratios declined from the prior quarter.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net income, third quarter of 2026GAAP | $44.94M | an increase of $0.4 million | an increase of $3.6 million |
| Diluted earnings per share, third quarter of 2026GAAP | $ 0.45 | an increase of $0.01 per share | an increase of $0.06 per share |
| Core net income, third quarter of 2026non-GAAP | $45.44M | an increase of $1.0 million | an increase of $4.3 million |
| Core diluted earnings per share, third quarter of 2026non-GAAP | $ 0.45 | an increase of $0.01 per share | an increase of $0.06 per share |
| Net interest income, third quarter of 2026GAAP | $116.3M | – | – |
| Net interest income, FTE, third quarter of 2026non-GAAP | $116.7M | increased $3.9 million | increased $5.3 million |
| Net interest margin, FTE, third quarter of 2026non-GAAP | 4.11 % | increased 10 basis points | increased 19 basis points |
| Interest income, third quarter of 2026GAAP | $162.3M | – | – |
| Interest expense, third quarter of 2026GAAP | $45.99M | – | – |
| Noninterest income, third quarter of 2026GAAP | $26.73M | – | – |
| Noninterest income excluding securities gains, third quarter of 2026other | $26.7M | unchanged | increased $2.2 million |
| Total revenue, third quarter of 2026other | $143.4M | – | – |
| Core total revenue, third quarter of 2026non-GAAP | $143.3M | – | – |
| Noninterest expense, third quarter of 2026GAAP | $78.18M | – | – |
| Noninterest expense excluding merger-related expense, third quarter of 2026other | $78.1M | increased $4.0 million | increased $5.4 million |
| Income before income taxes, third quarter of 2026GAAP | $50.67M | – | – |
| Income tax provision, third quarter of 2026GAAP | $5.73M | decreased $6.0 million | – |
| Core pre-tax pre-provision net revenue, third quarter of 2026non-GAAP | $65.50M | an increase of $0.5 million | an increase of $2.6 million |
| Return on average assets, third quarter of 2026GAAP | 1.46 % | – | – |
| Core return on average assets, third quarter of 2026non-GAAP | 1.48 % | increased two basis points | increased 14 basis points |
| Return on average equity, third quarter of 2026GAAP | 11.44 % | – | – |
| Return on average tangible common equity, third quarter of 2026other | 15.73 % | – | – |
| Core return on average tangible common equity, third quarter of 2026non-GAAP | 15.90 % | increased 24 basis points | increased 100 basis points |
| Core efficiency ratio, third quarter of 2026non-GAAP | 53.15 % | increased 91 basis points | increased 85 basis points |
| Provision for credit losses, third quarter of 2026GAAP | $14.19M | an increase of $5.3 million | – |
| Net charge-offs, third quarter of 2026GAAP | $4.58M | a decrease of $6.9 million | – |
| Net charge-offs as a percentage of average loans and leases outstanding, annualized, third quarter of 2026other | 0.19 % | – | – |
| Allowance for credit losses as a percent of end-of-period loans and leases, third quarter of 2026other | 1.40 % | an increase of five basis points | – |
| Total nonperforming loans and leases, September 30, 2026other | $95.24M | increased $13.6 million | – |
| Nonperforming loans and leases as a percent of end-of-period loans and leases, September 30, 2026other | 0.99 % | – | – |
| Allowance for credit losses, September 30, 2026GAAP | $133.5M | – | – |
| Loans and leases, September 30, 2026GAAP | $9.54B | increased $63.4 million, or 2.6% annualized | – |
| Total deposits, September 30, 2026GAAP | $10.27B | increased $13.8 million, or 0.5% annualized | – |
| Total borrowings, September 30, 2026GAAP | $289.4M | – | – |
| Total assets, September 30, 2026GAAP | $12.20B | – | – |
| Shareholders' equity, September 30, 2026GAAP | $1.48B | – | – |
| Common Equity Tier I capital ratio, September 30, 2026other | 11.9% | – | – |
| Net income, nine months ended September 30, 2026GAAP | $127.1M | – | – |
| Diluted earnings per share, nine months ended September 30, 2026GAAP | $ 1.25 | – | – |
| Core net income, nine months ended September 30, 2026non-GAAP | $127.3M | – | – |
| Core diluted earnings per share, nine months ended September 30, 2026non-GAAP | $ 1.26 | – | – |
| Net interest income, nine months ended September 30, 2026GAAP | $337.7M | – | – |
| Provision for credit losses, nine months ended September 30, 2026GAAP | $33.85M | – | – |
| Noninterest income, nine months ended September 30, 2026GAAP | $78.31M | – | – |
| Noninterest expense, nine months ended September 30, 2026GAAP | $228.0M | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
Capital returns
- A total of 4,156,764 shares at a weighted average price of $21.18 were repurchased during the third quarter of 2026.
- On October 27, 2026, the Board of Directors authorized an additional $25 million share repurchase program.
- First Commonwealth Financial Corporation declared a common stock quarterly dividend of $0.14 per share.
- The cash dividend is payable on November 20, 2026 to shareholders of record as of November 6, 2026.
What drove it
- Net interest income, FTE, increased $3.9 million from the previous quarter, primarily due to a 10 basis point expansion in net interest margin and one additional day in the quarter.
- The net interest margin expansion was primarily due to a seven basis point decrease in the cost of deposits, a $104.8 million increase in average loans, and a $106.7 million decrease in average cash balances.
- Average time deposits decreased $163.8 million and average noninterest-bearing deposits grew $72.4 million.
- The income tax provision decreased $6.0 million from the previous quarter due to the recognition of $4.7 million in Federal income tax credits.
- Third-quarter noninterest income benefited from higher swap fee income, Trust income and gain on sale of Mortgage loans.
Concerns
- The provision for credit losses increased by $5.3 million from the previous quarter, driven by a $3.5 million increase in reserves for unfunded commitments and a $6.7 million increase in reserves primarily for three individually analyzed commercial credits.
- Two commercial credits with an aggregate balance of $21.0 million migrated to nonaccrual status during the third quarter of 2026.
- Total nonperforming loans increased $13.6 million from the previous quarter to $95.2 million.
- Noninterest expense excluding merger-related expense increased $4.0 million from the previous quarter, and the core efficiency ratio increased 91 basis points to 53.15%.
- Average deposits decreased $87.1 million, or 3.3% annualized, from the previous quarter.
- Common Equity Tier I declined to 11.9% at September 30, 2026 from 12.6% at June 30, 2026.
What to watch
- Credit performance and the resolution of the three individually analyzed commercial credits underlying the reserve increase.
- The level of nonperforming loans after the migration of two commercial credits to nonaccrual status.
- Whether net interest margin benefits from deposit-cost reductions and loan repricing continue.
- Deposit trends, particularly average deposits and the mix between time deposits and noninterest-bearing deposits.
- Expense control and progress toward the stated objective of positive operating leverage.
- Execution of the additional $25 million share repurchase program.
Balance sheet and cash flow
- Cash and due from banks was $ 93,509 (dollars in thousands) at September 30, 2026, compared with $ 110,327 (dollars in thousands) at June 30, 2026 and $ 117,241 (dollars in thousands) at September 30, 2025.
- Interest-bearing bank deposits were $ 34,502 (dollars in thousands) at September 30, 2026, compared with $ 69,308 (dollars in thousands) at June 30, 2026 and $ 44,170 (dollars in thousands) at September 30, 2025.
- Total deposits were $ 10,273,909 (dollars in thousands) at September 30, 2026.
- Total borrowings were $ 289,372 (dollars in thousands) at September 30, 2026.
- No operating cash flow, investing cash flow, financing cash flow, or free cash flow was reported.
Analysis
First Commonwealth reported third-quarter GAAP net income of $ 44,943 (dollars in thousands), or $ 0.45 per diluted share, compared with $ 44,589 (dollars in thousands), or $ 0.44 per diluted share, in the prior quarter and $ 41,328 (dollars in thousands), or $ 0.39 per diluted share, a year earlier. Core net income was $ 45,442 (dollars in thousands), while core diluted earnings per share was $ 0.45. For the nine months ended September 30, 2026, GAAP net income was $ 127,080 (dollars in thousands) and diluted earnings per share was $ 1.25.
Revenue momentum was led by net interest income. Net interest income, FTE, was $ 116,740 (dollars in thousands), increasing $3.9 million from the prior quarter and $5.3 million from the prior-year quarter. Net interest margin, FTE, rose to 4.11 % from 4.01 % in the prior quarter and 3.92 % a year ago. Management attributed sequential margin expansion to a lower cost of deposits, higher average loans, lower average cash balances, higher yields on variable or adjustable loans, and upward repricing of fixed-rate loans. Total loans and leases rose to $ 9,537,685 (dollars in thousands), while total deposits were $ 10,273,909 (dollars in thousands).
Expense and tax items materially influenced quarterly earnings. Noninterest expense excluding merger-related expense was $78.1 million, up $4.0 million from the prior quarter, with increases in salaries and benefits, loss on sale or write-down of assets, furniture and equipment, and FDIC insurance. The core efficiency ratio increased to 53.15 %. Income tax provision was 5,732 (dollars in thousands), compared with 11,684 (dollars in thousands) in the prior quarter, as the company recognized $4.7 million in Federal income tax credits during the third quarter.
Credit was the principal offset to improved revenue. Provision for credit losses was $ 14,188 (dollars in thousands), compared with $ 8,931 (dollars in thousands) in the previous quarter. Total nonperforming loans and leases increased to $ 95,240 (dollars in thousands), or 0.99 % of end-of-period loans and leases, from $ 81,640 (dollars in thousands), or 0.86 %, at June 30, 2026. The company cited the migration of two commercial credits with an aggregate balance of $21.0 million to nonaccrual status. Net charge-offs fell to $ 4,581 (dollars in thousands) from $ 11,441 (dollars in thousands) in the preceding quarter.
Capital returns were substantial during the quarter, with 4,156,764 shares repurchased at a weighted average price of $21.18, followed by authorization of an additional $25 million repurchase program. The company also declared a $0.14 per share quarterly dividend. Capital ratios remained above the stated regulatory well-capitalized requirement, with Common Equity Tier I of 11.9% and $539.4 million in excess capital above the 6.5% requirement, though the reported ratio was below the 12.6 % reported at June 30, 2026. The filing provided no forward financial guidance.
Management, verbatim
Third-quarter results reflected higher revenue, net interest margin expansion and modest loan growth, alongside a higher provision expense and operating expenses.
T. Michael Price, President and Chief Executive Officer
Our near-term priorities include continuing to improve credit performance, generating profitable growth and controlling expenses to create positive operating leverage.
T. Michael Price, President and Chief Executive Officer
Not in the filing
stated, not guessed- Forward revenue guidance
- Forward earnings per share guidance
- Forward net interest margin guidance
- Forward expense guidance
- Forward tax-rate guidance
- Prior-release outlook for comparison
- Operating cash flow
- Free cash flow
- Gross margin, which is not reported for this banking issuer
- Reportable operating segments or segment revenue
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.