First Commonwealth Financial boosts net income on margin expansion
The bank reported GAAP net income of $44.6 million for the second quarter of 2026.
First Commonwealth Financial (FCF) reported GAAP net income of $44.6 million for the second quarter of 2026. The bank, a regional financial services provider, saw net income rise $7.0 million from the first quarter and $11.2 million from the same period last year.
Core net income followed a similar trajectory, increasing to $44.4 million. This result reflects a $7.0 million increase over the previous quarter and a $4.9 million increase compared to the second quarter of 2025.
Growth was driven by an expansion in the net interest margin, which rose 9 basis points sequentially to 4.01%. This represents an 18 basis point increase year-over-year. Consequently, net interest income reached $112.8 million, up $3.5 million from the first quarter and $6.2 million from the prior year.
Noninterest income, excluding securities gains, rose to $26.7 million, an increase of $2.3 million from the first quarter and $1.9 million from the second quarter of 2025. The company also improved its core efficiency ratio, which decreased 320 basis points to 52.24% from the previous quarter and 183 basis points from the prior year.
Balance sheet activity showed a divergence between lending and deposits. Total average loans declined $106.3 million, or 4.5% annualized, from the first quarter. Meanwhile, average deposits increased $52.3 million, a 2.0% annualized increase. The loan-to-deposit ratio ended the quarter at 92.7%, up from 90.9% in the previous quarter.
Credit quality metrics shifted as net charge-offs on loans rose to $11.4 million, an increase of $3.3 million from the first quarter and $8.6 million from the second quarter of 2025. Annualized net charge-offs as a percentage of average loans rose to 0.49%, compared to 0.35% in the first quarter and 0.12% in the second quarter of 2025. Total nonperforming loans decreased by $10.7 million to $81.6 million.
On July 28, 2026, the Board of Directors authorized a new $75.0 million share repurchase program. The company also paid a quarterly common stock dividend of $0.14 per share, which is a 3.7% increase from the second quarter of 2025.