What changed in this filing

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Item 1. Financial Statements

2024-11-05 compared with 2024-08-06 · 186 added, 157 removed, 1447 unchanged (19% of the section changed)

3 unchanged sentences

(Dollars in millions, except share and per share data)

September 30,

2024 December 31,

45 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

50 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

21 unchanged sentences

Income (Loss) Treasury

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Balance at beginning of period $ 107 $ 4 $ 4,686 $ 1,564 $ ( 355 ) $ ( 188 ) $ 5,818

7 unchanged sentences

Issuance of common stock — 1 — — 1

Repurchase of common stock ( 25 ) ( 25 )

Restricted stock compensation 2 2

Balance at end of period $ 107 $ 4 $ 4,689 $ 1,664 $ ( 382 ) $ ( 188 ) $ 5,894

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Balance at beginning of period $ — $ 4 $ 4,690 $ 1,820 $ ( 243 ) $ ( 181 ) $ 6,090

13 unchanged sentences

Income (Loss) Treasury

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Balance at beginning of period $ 107 $ 4 $ 4,696 $ 1,370 $ ( 357 ) $ ( 167 ) $ 5,653

10 unchanged sentences

Balance at end of period $ 107 $ 4 $ 4,689 $ 1,664 $ ( 382 ) $ ( 188 ) $ 5,894

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Balance at beginning of period $ 107 $ 4 $ 4,692 $ 1,669 $ ( 235 ) $ ( 187 ) $ 6,050

16 unchanged sentences

(Dollars in millions)

Six Months Ended

Nine Months Ended

September 30,

Operating Activities

44 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

September 30, 2024

The terms “FNB,” “the Corporation,” “we,” “us” and “our” throughout this Report mean F.N.B.

10 unchanged sentences

and Charleston, South Carolina.

As of June 30, 2024, we had 345 branches throughout Pennsylvania, Ohio, Maryland, West Virginia, North Carolina, South Carolina, Washington D.C.

As of September 30, 2024, we had 349 branches throughout Pennsylvania, Ohio, Maryland, West Virginia, North Carolina, South Carolina, Washington D.C.

and Virginia.

19 unchanged sentences

Such reclassifications had no impact on our net income and stockholders' equity.

Events occurring subsequent to June 30, 2024 have been evaluated for potential recognition or disclosure in the Consolidated Financial Statements through the date of the filing of the Consolidated Financial Statements with the SEC.

Events occurring subsequent to September 30, 2024 have been evaluated for potential recognition or disclosure in the Consolidated Financial Statements through the date of the filing of the Consolidated Financial Statements with the SEC.

Certain information and Note disclosures normally included in Consolidated Financial Statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC.

41 unchanged sentences

The amortized cost and fair value of AFS debt securities are presented in the table below.

There was no ACL associated with the AFS portfolio at June 30, 2024 and December 31, 2023.

Accrued interest receivable on AFS debt securities totaled $ 13.3 million at June 30, 2024 and $ 9.6 million at December 31, 2023, and is excluded from the estimate of credit losses and assessed separately in other assets in the Consolidated Balance Sheets.

There was no ACL associated with the AFS portfolio at September 30, 2024 and December 31, 2023.

Accrued interest receivable on AFS debt securities totaled $ 14.1 million at September 30, 2024 and $ 9.6 million at December 31, 2023, and is excluded from the estimate of credit losses and assessed separately in other assets in the Consolidated Balance Sheets.

Accordingly, we have excluded accrued interest receivable from both the fair value and amortized cost basis of AFS debt securities.

1 unchanged sentence

Debt Securities AFS:

June 30, 2024

September 30, 2024

Treasury $ 199 $ 2 $ — $ 201

24 unchanged sentences

The amortized cost and fair value of HTM debt securities are presented in the following table.

The ACL for the HTM portfolio was $ 0.27 million and $ 0.28 million at June 30, 2024 and December 31, 2023, respectively.

Accrued interest receivable on HTM debt securities totaled $ 14.1 million and $ 14.7 million at June 30, 2024 and December 31, 2023, respectively, and is excluded from the estimate of credit losses and assessed separately in other assets in the Consolidated Balance Sheets.

The ACL for the HTM portfolio was $ 0.25 million and $ 0.28 million at September 30, 2024 and December 31, 2023, respectively.

Accrued interest receivable on HTM debt securities totaled $ 13.0 million and $ 14.7 million at September 30, 2024 and December 31, 2023, respectively, and is excluded from the estimate of credit losses and assessed separately in other assets in the Consolidated Balance Sheets.

Accordingly, we have excluded accrued interest receivable from both the fair value and amortized cost basis of HTM debt securities.

1 unchanged sentence

Debt Securities HTM:

June 30, 2024

September 30, 2024

Treasury $ 1 $ — $ — $ 1

government agencies 1 — — 1

government-sponsored entities 29 — — 29

20 unchanged sentences

Total debt securities HTM $ 3,911 $ 8 $ ( 326 ) $ 3,593

There were no significant gross gains or gross losses realized on securities during the six months ended June 30, 2024 or 2023.

There were no significant gross gains or gross losses realized on securities during the nine months ended September 30, 2024 or 2023.

In the fourth quarter of 2023, we sold $ 648.7 million of AFS securities resulting in a realized loss of $ 67.4 million as part of a proactive balance sheet management strategy.

Unrealized losses on the AFS and HTM portfolios are due to the increase in market interest rates with 85.3 % of these securities backed or sponsored by the U.S.

government as of June 30, 2024.

As of June 30, 2024, the amortized cost and fair value of debt securities, by contractual maturities, were as follows:

government as of September 30, 2024.

As of September 30, 2024, the amortized cost and fair value of debt securities, by contractual maturities, were as follows:

Available for Sale Held to Maturity

14 unchanged sentences

Following is information relating to securities pledged:

(dollars in millions) June 30,

(dollars in millions) September 30,

2024 December 31,

12 unchanged sentences

Debt Securities AFS

June 30, 2024

September 30, 2024

Treasury — $ — $ — 2 $ 74 $ — 2 $ 74 $ —

29 unchanged sentences

Total 6 $ 70 $ — 236 $ 2,235 $ ( 216 ) 242 $ 2,305 $ ( 216 )

We evaluated the AFS debt securities that were in an unrealized loss position at June 30, 2024.

We evaluated the AFS debt securities that were in an unrealized loss position at September 30, 2024.

Based on the credit ratings and implied government guarantee for these securities, we concluded the loss position is temporary and caused by the significant movement of interest rates since 2022 and does not reflect any expected credit losses.

4 unchanged sentences

Based on the nature of the issuers and current conditions, we have determined that securities backed by the UST, Fannie Mae, Freddie Mac, FHLB, Ginnie Mae, and the SBA have zero expected credit loss.

Our municipal bond portfolio, with a carrying amount of $ 1.0 billion as of June 30, 2024 is highly rated with an average rating of AA and over 99 % of the portfolio rated A or better.

Our municipal bond portfolio, with a carrying amount of $ 1.0 billion as of September 30, 2024 is highly rated with an average rating of AA and over 99 % of the portfolio rated A or better.

All of the securities in the municipal portfolio are general obligation bonds.

9 unchanged sentences

We further refine the expected credit loss by factoring in economic forecast data using our Commercial and Industrial Non-Manufacturing loan portfolio forecast adjustment as derived through our assessment of the loan portfolio as a proxy for our municipal bond portfolio.

Our corporate bond portfolio, with a carrying amount of $ 56.1 million as of June 30, 2024 primarily consists of subordinated debentures of banks within our footprint.

Our corporate bond portfolio, with a carrying amount of $ 62.4 million as of September 30, 2024 primarily consists of subordinated debentures of banks within our footprint.

The average holding size of the securities in the corporate bond portfolio is $ 3.3 million.

5 unchanged sentences

We further refine the expected credit loss by factoring in economic forecast data using our bank-wide loan portfolio forecast adjustment as derived through our assessment of FNBPA's loan portfolio as a proxy for our corporate bond portfolio.

For the year-to-date periods ending June 30, 2024 and 2023, we had no significant provision expense and no charge-offs or recoveries for the securities portfolio.

The ACL on the HTM portfolio was $ 0.27 million, consisting of $ 0.06 million relating to the municipal bond portfolio and $ 0.21 million relating to other debt securities, as of June 30, 2024, and $ 0.06 million relating to the municipal bond portfolio and $ 0.22 million relating to other debt securities as of December 31, 2023.

The AFS securities portfolios did no t have an ACL at June 30, 2024 or December 31, 2023 and there were no securities that were past due or on non-accrual at either date.

For the year-to-date periods ending September 30, 2024 and 2023, we had no significant provision expense and no charge-offs or recoveries for the securities portfolio.

The ACL on the HTM portfolio was $ 0.25 million, consisting of $ 0.06 million relating to the municipal bond portfolio and $ 0.19 million relating to other debt securities, as of September 30, 2024, and $ 0.06 million relating to the municipal bond portfolio and $ 0.22 million relating to other debt securities as of December 31, 2023.

The AFS securities portfolios did no t have an ACL at September 30, 2024 or December 31, 2023 and there were no securities that were past due or on non-accrual at either date.

LOANS AND LEASES

Accrued interest receivable on loans and leases, which totaled $ 141.6 million at June 30, 2024 and $ 128.6 million at December 31, 2023, is excluded from the estimate of credit losses and assessed separately in other assets in the Consolidated Balance Sheets for both periods and is not included in the following tables.

Accrued interest receivable on loans and leases, which totaled $ 128.4 million at September 30, 2024 and $ 128.6 million at December 31, 2023, is excluded from the estimate of credit losses and assessed separately in other assets in the Consolidated Balance Sheets for both periods and is not included in the following tables.

Loans and Leases by Portfolio Segment

Following is a summary of total loans and leases, net of unearned income:

(in millions) June 30, 2024 December 31, 2023

(in millions) September 30, 2024 December 31, 2023

Commercial real estate $ 12,812 $ 12,305

9 unchanged sentences

Total loans and leases, net of unearned income $ 33,717 $ 32,323

The remaining accretable discount included in the amortized cost of acquired loans was $ 35.8 million and $ 42.6 million at June 30, 2024 and December 31, 2023, respectively.

The remaining accretable discount included in the amortized cost of acquired loans was $ 32.9 million and $ 42.6 million at September 30, 2024 and December 31, 2023, respectively.

The loans and leases portfolio categories are comprised of the following types of loans, where in each case the LGD is dependent on the nature and value of the respective collateral:

7 unchanged sentences

• Consumer lines of credit include home equity lines of credit and consumer lines of credit that are either unsecured or secured by collateral other than home equity where the primary default risk driver is the borrower's employment status and income.

During 2024, we sold $ 0.8 billion in indirect auto loans.

We recognized a $ 9.0 million loss during the first nine months of 2024 related to the sales.

The related servicing asset was not significant at September 30, 2024.

The loans and leases portfolio consists principally of loans to individuals and small- and medium-sized businesses within our primary market in seven states and the District of Columbia.

7 unchanged sentences

The following table shows occupancy information relating to commercial real estate loans:

(dollars in millions) June 30,

(dollars in millions) September 30,

2024 December 31,

17 unchanged sentences

The following table summarizes the designated loan rating category by loan class including term loans on an amortized cost basis by origination year and year-to-date gross charge-offs by originating year:

June 30, 2024 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Total

September 30, 2024 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Total

(in millions)

22 unchanged sentences

Total commercial loans and leases 2,140 3,226 3,680 3,229 1,988 4,726 2,193 21,182

June 30, 2024 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Total

September 30, 2024 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Total

(in millions)

81 unchanged sentences

Leases Non-accrual with No ACL

June 30, 2024

September 30, 2024

Commercial real estate $ 41 $ — $ 49 $ 90 $ 12,722 $ 12,812 $ 17

27 unchanged sentences

Following is a summary of non-performing assets:

(dollars in millions) June 30,

(dollars in millions) September 30,

2024 December 31,

6 unchanged sentences

Non-performing assets plus 90 days or more past due / total loans and leases plus OREO

The carrying value of residential-secured consumer OREO held as a result of obtaining physical possession upon completion of a foreclosure or through completion of a deed in lieu of foreclosure amounted to $ 1.2 million at both June 30, 2024 and December 31, 2023.

The recorded investment of residential-secured consumer OREO for which formal foreclosure proceedings are in process at June 30, 2024 and December 31, 2023 totaled $ 12.9 million and $ 9.4 million, respectively.

Approximately $ 65.6 million of commercial loans are collateral dependent at June 30, 2024.

The carrying value of residential-secured consumer OREO held as a result of obtaining physical possession upon completion of a foreclosure or through completion of a deed in lieu of foreclosure amounted to $ 1.0 million at September 30, 2024 and $ 1.2 million at December 31, 2023.

The recorded investment of residential-secured consumer OREO for which formal foreclosure proceedings are in process at September 30, 2024 and December 31, 2023 totaled $ 12.9 million and $ 9.4 million, respectively.

Approximately $ 148.0 million of commercial loans are collateral dependent at September 30, 2024.

Repayment is expected to be substantially made through the operation or sale of the collateral on the loan.

3 unchanged sentences

These modifications typically result from loss mitigation activities and could include a term extension, interest rate reduction, principal forgiveness and other actions intended to minimize the economic loss and to avoid foreclosure or repossession of collateral.

Accrued interest receivable on loan modifications totaled $ 0.05 million and $ 0.08 million at June 30, 2024 and June 30, 2023, respectively, and is excluded from the amortized cost of loan modifications in the tables that follow.

Accrued interest receivable on loan modifications totaled $ 0.07 million and $ 0.08 million at September 30, 2024 and September 30, 2023, respectively, and is excluded from the amortized cost of loan modifications in the tables that follow.

The following table shows the amortized cost basis at the end of the reporting period of the loans modified during the period to borrowers experiencing financial difficulty, disaggregated by class of financing receivable, type of concession granted and the financial effect of the modifications made to borrowers experiencing financial difficulty:

(dollars in millions) Amortized Cost Basis % of Total Class of Financing Receivable Financial Effect

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Term Extension

Commercial real estate $ 0.3 — % The modified loans had an average increase in term of 7 months, extending the maturity date.

Direct installment 0.1 — The modified loans had an average increase in term of 19 months extending the maturity date.

3 unchanged sentences

Residential mortgages 0.1 — Multiple modifications were made with no material financial effect.

Consumer lines of credit 0.2 0.02 Multiple modifications were made with no material financial effect.

Commercial real estate 0.1 — 3 to 9 month payment deferrals with no income being earned on these loans.

Balloon Payment

Commercial real estate 0.1 — Modifications were made with no material financial effect.

Commercial real estate 0.5 — Reduction of cash flow due to lower payments.

Total Outstanding Modified $ 2.2

(dollars in millions) Amortized Cost Basis % of Total Class of Financing Receivable Financial Effect

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Term Extension

Commercial real estate $ 0.3 — % The modified loans had an average increase in term of 7 months, extending the maturity date.

Commercial and industrial 0.1 — The modified loans had an average increase in term of 3 months, extending the maturity date.

Direct installment 1.0 0.04 The modified loans had an average increase in term of 51 months, extending the maturity date.

4 unchanged sentences

Term Extension and Rate Reduction

Commercial real estate 0.9 0.01 Multiple modifications were made with no material financial effect.

Residential mortgages 0.8 0.01 Multiple modifications were made with no material financial effect.

1 unchanged sentence

Balloon Payment

Commercial real estate 0.6 — Multiple modifications were made with no material financial effect.

Commercial real estate 0.7 0.01 Modifications were made with no material financial effect.

Commercial real estate 4.8 0.04 3 to 12 month payment deferrals with no income being earned on these loans.

2 unchanged sentences

(dollars in millions) Amortized Cost Basis % of Total Class of Financing Receivable Financial Effect

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Term Extension

Commercial real estate $ 0.8 0.01 % The modified loans had an average increase in term of 46 months, extending the maturity date.

Direct installment 0.3 0.01 The repayment on the loans modified were extended, lowering the monthly repayment.

Residential mortgages 1.5 0.02 The modified loans had an average increase in term of 138 months, extending the maturity date.

Term Extension and Rate Reduction

Commercial and industrial 0.1 — The term was extended, with a weighted average yield reduction of 487 basis points.

Commercial and industrial 0.7 0.01 The modified loans had an average increase in term of 25 months, extending the maturity date.

Direct installment 0.4 0.01 The modified loans had an average increase in term of 74 months, extending the maturity date.

Residential mortgages 1.1 0.02 The modified loans had an average increase in term of 42 months, extending the maturity date.

Consumer lines of credit 0.6 0.05 The term was extended, with a weighted average yield reduction of 326 basis points.

Consumer lines of credit 0.2 0.02 The lines were termed to an average of 243 months.

Term Extension and Rate Reduction

Commercial and industrial 0.1 — The term was extended and the rate was reduced, lowering the monthly payment.

Direct installment 0.1 — The term was extended and the rate was reduced, lowering the monthly payment.

Residential mortgages 0.1 — The term was extended and the rate was reduced, lowering the monthly payment.

Commercial real estate 0.2 — Multiple modifications were made with no material financial effect.

Direct installment 0.1 — Multiple modifications were made with no material financial effect.

Consumer lines of credit 0.4 0.03 Multiple modifications were made with no material financial effect.

1 unchanged sentence

(dollars in millions) Amortized Cost Basis % of Total Class of Financing Receivable Financial Effect

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Term Extension

1 unchanged sentence

Commercial and industrial 3.0 0.04 The modified loans had an average increase in term of 16 months, extending the maturity date.

Direct installment 0.4 0.01 The repayment on the loans modified were extended, lowering the monthly repayment.

Direct installment 0.8 0.03 The modified loans had an average increase in term of 99 months, extending the maturity date.

Residential mortgages 2.7 0.04 The modified loans had an average increase in term of 105 months, extending the maturity date.

6 unchanged sentences

Commercial real estate 0.5 — Multiple modifications were made with no material financial effect.

Direct installment 0.1 — Multiple modifications were made with no material financial effect.

Residential mortgages 0.1 — Multiple modifications were made with no material financial effect.

2 unchanged sentences

Some loan modifications may not ultimately result in the full collection of principal and interest, as modified, and may result in potential incremental losses which are factored into the ACL.

There were no additional funds committed to borrowers whose loans were modified during the first six months of 2024.

There were no additional funds committed to borrowers whose loans were modified during the first nine months of 2024.

Commercial loans over $ 1.0 million whose terms have been modified may be placed on non-accrual, individually analyzed and measured based on the fair value of the underlying collateral.

Our ACL includes specific reserves for commercial loans modified.

There were $ 0.5 million and $ 5.3 million in specific reserves for commercial loans modified at June 30, 2024 and December 31, 2023, respectively, and pooled reserves for individual loans of $ 1.9 million and $ 2.0 million for those same periods, respectively, based on loan segment LGD.

There were $ 0.4 million and $ 5.3 million in specific reserves for commercial loans modified at September 30, 2024 and December 31, 2023, respectively, and pooled reserves for individual loans of $ 1.5 million and $ 2.0 million for those same periods, respectively, based on loan segment LGD.

Upon default, the amount of the recorded investment of the modified loan balance in excess of the fair value of the collateral, less estimated selling costs, is generally considered a confirmed loss and is charged-off against the ACL.

All other classes of loans whose terms have been modified are pooled and measured based on the loan segment LGD.

Our ACL included pooled reserves for these classes of loans of $ 4.1 million and $ 3.8 million as of June 30, 2024 and December 31, 2023, respectively.

Our ACL included pooled reserves for these classes of loans of $ 3.9 million and $ 3.8 million as of September 30, 2024 and December 31, 2023, respectively.

Upon default of an individual loan, our charge-off policy is followed for that class of loan.

3 unchanged sentences

(in millions) Term Extension Term Extension and Rate Reduction Balloon Payment Other Total Outstanding Modified

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Commercial real estate $ — $ — $ 0.1 $ — $ 0.1

1 unchanged sentence

Total commercial loans and leases — — 0.1 — 0.1

Direct installment 0.4 — — — 0.4

Residential mortgages 0.3 0.1 — — 0.4

1 unchanged sentence

Total $ 0.7 $ 0.1 $ 0.1 $ — $ 0.9

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Commercial real estate $ 0.7 $ — $ 0.7 $ 8.9 $ 10.3

1 unchanged sentence

Total commercial loans and leases 20.9 0.2 0.7 10.5 32.3

Direct installment 0.5 — — — 0.5

Residential mortgages 1.9 0.1 — — 2.0

2 unchanged sentences

(in millions) Term Extension Term Extension and Rate Reduction Other Total Outstanding Modified

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Commercial real estate $ — $ — $ 0.2 $ 0.2

1 unchanged sentence

Total commercial loans and leases 0.5 0.1 0.2 0.8

Direct installment 0.1 — — 0.1

Residential mortgages 0.1 — — 0.1

Total consumer loans 0.2 — — 0.2

Total $ 0.7 $ 0.1 $ 0.2 $ 1.0

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Commercial real estate $ 0.4 $ — $ 0.9 $ 1.3

1 unchanged sentence

Total commercial loans and leases 2.4 0.3 0.9 3.6

Direct installment 0.1 — — 0.1

Residential mortgages 0.1 0.3 — 0.4

6 unchanged sentences

(in millions) Current 30-89 Days Past Due 90+ Days Past Due

June 30, 2024

September 30, 2024

Commercial real estate $ 13.5 $ — $ —

7 unchanged sentences

(in millions) Current 30-89 Days Past Due 90+ Days Past Due

June 30, 2023

September 30, 2023

Commercial real estate $ 12.9 $ — $ —

15 unchanged sentences

Offs) Recoveries Provision for Credit Losses Balance at

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Commercial real estate $ 157.7 $ ( 13.8 ) $ 0.9 $ ( 12.9 ) $ 40.1 $ 184.9

11 unchanged sentences

Total allowance for credit losses on loans and leases and allowance for unfunded loan commitments $ 440.6 $ ( 30.1 ) $ 8.6 $ ( 21.5 ) $ 23.5 $ 442.6

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Commercial real estate $ 166.6 $ ( 24.1 ) $ 2.1 $ ( 22.0 ) $ 40.3 $ 184.9

16 unchanged sentences

Losses Balance at

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Commercial real estate $ 154.2 $ ( 0.6 ) $ 0.9 $ 0.3 $ 0.5 $ 155.0

11 unchanged sentences

Total allowance for credit losses on loans and leases and allowance for unfunded loan commitments $ 433.7 $ ( 41.2 ) $ 3.5 $ ( 37.7 ) $ 25.9 $ 421.9

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Commercial real estate $ 162.1 $ ( 8.9 ) $ 3.2 $ ( 5.7 ) $ ( 1.4 ) $ 155.0

13 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

10 unchanged sentences

• the historical through-the-cycle mean was calculated using an expanded period to include a prior recessionary period.

At June 30, 2024 and December 31, 2023, we utilized a third-party consensus macroeconomic forecast reflecting the current and projected macroeconomic environment.

For our ACL calculation at June 30, 2024, the macroeconomic variables that we utilized included, but were not limited to:

(i) the purchase only Housing Price Index, which increases 7.2 % over our R&S forecast period, (ii) a Commercial Real Estate Price Index, which increases 5.9 % over our R&S forecast period, (iii) S&P Volatility, which increases 12.3 % in 2024 and decreases 0.8 % in 2025 and (iv) personal and business bankruptcies, which increase steadily over the R&S forecast period but average below the historical through the cycle period.

At September 30, 2024 and December 31, 2023, we utilized a third-party consensus macroeconomic forecast reflecting the current and projected macroeconomic environment.

For our ACL calculation at September 30, 2024, the macroeconomic variables that we utilized included, but were not limited to:

(i) the purchase only Housing Price Index, which increases 6.5 % over our R&S forecast period, (ii) a Commercial Real Estate Price Index, which increases 12.7 % over our R&S forecast period, (iii) S&P Volatility, which increases 8.0 % in 2024 and 4.7 % in 2025 and (iv) personal and business bankruptcies, which increase steadily over the R&S forecast period but average below the historical through the cycle period.

Macroeconomic variables that we utilized for our ACL calculation as of December 31, 2023 included, but were not limited to:

(i) the purchase only Housing Price Index, which increases 5.3 % over our R&S forecast period, (ii) a Commercial Real Estate Price Index, which increases 0.1 % over our R&S forecast period, (iii) S&P Volatility, which decreases 4.0 % in 2024 and 2.9 % in 2025 and (iv) bankruptcies, which increase steadily over the R&S forecast period but average below the historical through the cycle period.

The ACL on loans and leases of $ 418.8 million at June 30, 2024 increased $ 13.2 million, or 3.3 %, from December 31, 2023.

Our ending ACL coverage ratio at June 30, 2024 was 1.24 %, compared to 1.25 % at December 31, 2023.

Total provision for credit losses for the three months ended June 30, 2024 was $ 20.2 million compared to $ 18.5 million for the same period of 2023 which included a $ 13 million specific reserve established for a single $ 32 million commercial and industrial loan downgraded to non-performing status during the second quarter of 2023.

The second quarter of 2024 reflected net charge-offs of $ 7.8 million, or 0.09 % annualized of average total loans, compared to $ 8.7 million, or 0.11 % annualized, in the second quarter of 2023.

Total provision for credit losses for the six months ended June 30, 2024 was $ 34.1 million compared to $ 32.6 million for the same period of 2023.

Net charge-offs were $ 20.6 million, or 0.13 % annualized of average total loans, during the six months ended June 30, 2024, compared to $ 21.9 million, or 0.14 % annualized, for the same period of 2023.

The ACL on loans and leases of $ 420.2 million at September 30, 2024 increased $ 14.6 million, or 3.6 %, from December 31, 2023.

Our ending ACL coverage ratio at September 30, 2024 was 1.25 %, compared to 1.25 % at December 31, 2023.

Total provision for credit losses for the three months ended September 30, 2024 was $ 23.5 million compared to $ 25.9 million for the same period of 2023, which included an $ 18.8 million specific reserve established for a single $ 31.9 million commercial and industrial loan downgraded to non-performing status during the second quarter of 2023.

The third quarter of 2024 reflected net charge-offs of $ 21.5 million, or 0.25 % annualized of average total loans, compared to $ 37.7 million, or 0.47 % annualized, in the third quarter of 2023.

Total provision for credit losses for the nine months ended September 30, 2024 was $ 57.6 million compared to $ 58.5 million, which included $ 31.9 million in provision for the previously disclosed isolated commercial loan charged off due to indications of alleged fraud and subsequent bankruptcy filings by our borrower and its primary supplier for the same period of 2023.

Net charge-offs were $ 42.1 million, or 0.17 % annualized of average total loans, during the nine months ended September 30, 2024, compared to $ 59.6 million, or 0.26 % annualized, for the same period of 2023.

The nine months ended September 30, 2023 was impacted by the previously disclosed isolated $ 31.9 million commercial loan .

LOAN SERVICING

2 unchanged sentences

The unpaid principal balance of mortgage loans serviced for others is listed below:

(in millions) June 30,

(in millions) September 30,

2024 December 31,

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

5 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

7 unchanged sentences

Fair value, end of period 75.2 75.1 75.2 75.1

There was no valuation allowance for MSRs at June 30, 2024 and the valuation allowance for MSRs as of December 31, 2023 was $ 0.2 million.

There was a $ 2.8 million valuation allowance for MSRs at September 30, 2024 and $ 0.2 million as of December 31, 2023.

The fair value of MSRs is highly sensitive to changes in assumptions and is determined by estimating the present value of the asset’s future cash flows utilizing market-based prepayment rates, discount rates and other assumptions validated through comparison to trade information, industry surveys and the use of independent third-party valuations.

3 unchanged sentences

Following is a summary of the sensitivity of the fair value of MSRs to changes in key assumptions:

(dollars in millions) June 30,

(dollars in millions) September 30,

2024 December 31,

17 unchanged sentences

The exercise of lease renewal options is at our sole discretion.

As of June 30, 2024, we had operating lease right-of-use assets and operating lease liabilities of $ 199.3 million and $ 240.4 million, respectively.

As of September 30, 2024, we had operating lease right-of-use assets and operating lease liabilities of $ 199.0 million and $ 240.1 million, respectively.

We have finance lease right-of-use assets and finance lease liabilities of $ 34.1 million and $ 35.9 million, respectively.

Our operating lease agreements do not contain any material residual value guarantees or material restrictive covenants.

As of June 30, 2024, we have certain operating lease agreements, primarily for administrative office space, that have not yet commenced.

As of September 30, 2024, we have certain operating lease agreements, primarily for administrative office space, that have not yet commenced.

At commencement, it is expected that these leases will add approximately $ 30.8 million in right-of-use assets and $ 33.0 million in other liabilities.

5 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(dollars in millions) 2024 2023 2024 2023

4 unchanged sentences

Other information related to leases is as follows:

Six Months Ended

Nine Months Ended

September 30,

(dollars in millions) 2024 2023

13 unchanged sentences

(in millions) Operating Leases Finance Leases Total Leases

June 30, 2024

September 30, 2024

0 - 12 months $ 35 $ 2 $ 37

14 unchanged sentences

(in millions) Total Assets Total Liabilities Maximum Exposure to Loss

June 30, 2024

September 30, 2024

Trust preferred securities (1)

21 unchanged sentences

We make equity investments as a limited partner in various partnerships of affordable housing (LIHTC), historic tax credit (HTC) and new market tax credit (NMTC) programs pursuant to Sections 42, 47 and 45d of the Internal Revenue Code, respectively.

The purpose of many of these investments is to support initiatives associated with the Community Reinvestment Act while earning a satisfactory return.

The purpose of many of these investments is to support initiatives associated with the Community Reinvestment

Act while earning a satisfactory return.

The activities of the LIHTC partnerships include the development and operation of multi-family housing that is leased to qualifying residential tenants.

10 unchanged sentences

The following table presents the balances of our LIHTC, HTC and NMTC investments and related unfunded commitments:

(in millions) June 30,

(in millions) September 30,

2024 December 31,

5 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

7 unchanged sentences

Following is a summary of short-term borrowings:

(in millions) June 30,

(in millions) September 30,

2024 December 31,

7 unchanged sentences

Securities are pledged to these customers in an amount at least equal to the outstanding balance.

Of the total short-term FHLB advances, $ 840.0 million, or 28.1 %, had overnight maturities as of June 30, 2024.

We had $ 450.0 million, or 23.7 %, of short-term FHLB advances with overnight maturities as of December 31, 2023.

At June 30, 2024, $ 200.0 million, or 6.7 %, of the short-term FHLB advances were swapped to fixed rates with various maturities through 2024.

This compares to $ 400.0 million, or 21.1 %, as of December 31, 2023.

Of the total short-term FHLB advances, $ 480.0 million, or 51.6 %, had overnight maturities as of September 30, 2024, compared to $ 450.0 million, or 23.7 %, as of December 31, 2023.

At September 30, 2024, $ 100.0 million, or 10.8 %, of the short-term FHLB advances was swapped to fixed rate with a 2024 maturity, compared to $ 400.0 million, or 21.1 %, as of December 31, 2023.

Federal funds purchased are overnight funds borrowed from other financial institutions.

2 unchanged sentences

Following is a summary of long-term borrowings:

(in millions) June 30,

(in millions) September 30,

2024 December 31,

5 unchanged sentences

Total long-term borrowings $ 2,515 $ 1,971

Our banking affiliate has available credit with the FHLB of $ 11.6 billion, of which $ 4.2 billion was utilized and included in short-term and long-term borrowings and $ 450.0 million was utilized for a letter of credit for pledging of public funds as of June 30, 2024.

Our banking affiliate has available credit with the FHLB of $ 11.9 billion, of which $ 2.7 billion was utilized and included in short-term and long-term borrowings and $ 750.0 million was utilized for a letter of credit for pledging of public funds as of September 30, 2024.

These advances are secured by loans collateralized by residential mortgages, home equity lines of credit, commercial real estate and FHLB stock.

The short-term borrowings are scheduled to mature in various amounts periodically during 2024 while the long-term borrowings are scheduled to mature periodically through 2028.

Effective interest rates paid on fixed rate long-term FHLB advances ranged from 4.23 % to 4.88 % for both the three months ended June 30, 2024 and for the year ended December 31, 2023.

The effective interest rate paid on variable rate long-term FHLB advances was Overnight SOFR plus an average spread of 33.1 basis points for the three months ended June 30, 2024.

Effective interest rates paid on fixed rate long-term FHLB advances ranged from 3.69 % to 4.88 % for the three months ended September 30, 2024 and 4.23 % and 4.88 % for the year ended December 31, 2023.

The effective interest rate paid on variable rate long-term FHLB advances was Overnight SOFR plus an average spread of 34.1 basis points for the three months ended September 30, 2024.

There were no variable rate advances for the year ended December 31, 2023.

The following table provides information relating to our senior notes and other subordinated debt as of June 30, 2024.

The following table provides information relating to our senior notes and other subordinated debt as of September 30, 2024.

The subordinated notes are eligible for treatment as tier 2 capital for regulatory capital purposes.

23 unchanged sentences

The junior subordinated debt is comprised of the debt securities issued by FNB, or companies we acquired, in relation to our four unconsolidated subsidiary trusts (collectively, the Trusts), which are unconsolidated VIEs, and are included on the Consolidated Balance Sheets in long-term borrowings.

Since third-party investors are the primary beneficiaries, the Trusts are

not consolidated in our Financial Statements.

Since third-party investors are the primary beneficiaries, the Trusts are not consolidated in our Financial Statements.

We record the distributions on the junior subordinated debt issued to the Trusts as interest expense.

The following table provides information relating to the Trusts as of June 30, 2024:

The following table provides information relating to the Trusts as of September 30, 2024:

(dollars in millions) Trust

10 unchanged sentences

Other Credit Availability

Our banking affiliate has additional unused other wholesale credit availability of $ 7.9 billion as of June 30, 2024.

Our banking affiliate has additional unused other wholesale credit availability of $ 7.4 billion as of September 30, 2024.

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

10 unchanged sentences

The following table presents notional amounts and gross fair values of our derivative assets and derivative liabilities which are not offset in the Consolidated Balance Sheets:

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

Notional Fair Value Notional Fair Value

28 unchanged sentences

Amount of Gain (Loss) Recognized in OCI on Derivatives Location of Gain (Loss) Reclassified from AOCI into Income Amount of Gain (Loss) Reclassified from AOCI into Income

Six Months Ended

June 30, Six Months Ended

Nine Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

1 unchanged sentence

Interest rate contracts $ ( 7 ) $ ( 21 ) Interest income (expense) $ ( 30 ) $ ( 16 )

Other income — —

The following table represents gains (losses) recognized in the Consolidated Statements of Income on cash flow hedging relationships:

Six months ended June 30,

Nine months ended September 30,

(in millions) Interest Income - Loans and Leases Interest Expense - Short-Term Borrowings Interest Income - Loans and Leases Interest Expense - Short-Term Borrowings

4 unchanged sentences

Amount of gain (loss) reclassified from AOCI into net income ( 37 ) 7 ( 33 ) 17

As of June 30, 2024, the maximum length of time over which forecasted interest cash flows are hedged is 1.8 years.

In the twelve months that follow June 30, 2024, we expect to reclassify from the amount currently reported in AOCI net derivative losses of $ 35.9 million ($ 27.8 million net of tax), in association with interest on the hedged loans and FHLB advances.

This amount could differ from amounts actually recognized due to changes in interest rates, hedge de-designations, and the addition of other hedges subsequent to June 30, 2024.

As of September 30, 2024, the maximum length of time over which forecasted interest cash flows are hedged is 1.6 years.

In the twelve months that follow September 30, 2024, we expect to reclassify from the amount currently reported in AOCI net derivative losses of $ 20.8 million ($ 16.1 million net of tax), in association with interest on the hedged loans and FHLB advances.

This amount could differ from amounts actually recognized due to changes in interest rates, hedge de-designations, and the addition of other hedges subsequent to September 30, 2024.

There were no components of derivative gains or losses excluded from the assessment of hedge effectiveness related to these cash flow hedges.

Also, during the six months ended June 30, 2024 and 2023, there were no gains or losses from cash flow hedge derivatives reclassified to earnings because it became probable that the original forecasted transactions would not occur.

Also, during the nine months ended September 30, 2024 and 2023, there were no gains or losses from cash flow hedge derivatives reclassified to earnings because it became probable that the original forecasted transactions would not occur.

Derivatives Not Designated as Hedging Instruments under GAAP

1 unchanged sentence

Interest rate swap agreements with loan customers and with the offsetting counterparties are reported at fair value in other assets and other liabilities on the Consolidated Balance Sheets with any resulting gain or loss recorded in current period earnings as other income or other expense.

Risk participation agreements sold with notional amounts totaling $ 603.9 million as of June 30, 2024 have remaining terms ranging from one month to seventeen years .

Under these agreements, our maximum exposure assuming a customer defaults on their obligation to perform under certain derivative swap contracts with third parties would be $ 0.1 million at both June 30,

2024 and December 31, 2023.

The fair values of risk participation agreements purchased and sold were $ 0.1 million and $ 0.1 million, respectively, at June 30, 2024 and $ 0.2 million and $ 0.1 million, respectively at December 31, 2023.

Risk participation agreements sold with notional amounts totaling $ 619.6 million as of September 30, 2024 have remaining terms ranging from one month to seventeen years .

The fair values of risk participation agreements purchased and sold were $ 0.2 million and $ 0.1 million, respectively, at September 30, 2024 and $ 0.2 million and $ 0.1 million, respectively at December 31, 2023.

The following table presents the effect of certain derivative financial instruments on the Consolidated Statements of Income:

Six Months Ended

Nine Months Ended

September 30,

(in millions) Consolidated Statements of Income Location 2024 2023

9 unchanged sentences

Certain master netting agreements contain provisions that, if violated, could cause the counterparties to request immediate settlement or demand full collateralization under the derivative instrument.

If we had breached our agreements with our derivative counterparties we would be required to settle our obligations under the agreements at the termination value and would be required to pay no thing as of June 30, 2024 or December 31, 2023, in excess of amounts previously posted as collateral with the respective counterparty.

If we had breached our agreements with our derivative counterparties we would be required to settle our obligations under the agreements at the termination value and would be required to pay no thing as of September 30, 2024 or December 31, 2023, in excess of amounts previously posted as collateral with the respective counterparty.

The following table presents a reconciliation of the net amounts of derivative assets and derivative liabilities presented in the Consolidated Balance Sheets to the net amounts that would result in the event of offset:

6 unchanged sentences

Collateral Net

June 30, 2024

September 30, 2024

Derivative Assets

Interest rate contracts:

Designated $ 2 $ — $ 2 $ —

Not designated 54 — 54 —

2 unchanged sentences

Interest rate contracts:

Designated $ 3 $ — $ 3 $ —

Not designated $ 62 $ — $ 62 $ —

16 unchanged sentences

Following is a summary of off-balance sheet credit risk information:

(in millions) June 30,

(in millions) September 30,

2024 December 31,

1 unchanged sentence

Standby letters of credit 259 257

At June 30, 2024, funding of 76.8 % of the commitments to extend credit was dependent on the financial condition of the customer.

At September 30, 2024, funding of 79.5 % of the commitments to extend credit was dependent on the financial condition of the customer.

We have the ability to withdraw such commitments at our discretion.

4 unchanged sentences

The credit risk involved in issuing letters of credit is actively monitored through review of the historical performance of our portfolios.

Our AULC for commitments that are not unconditionally cancellable, which is included in other liabilities on the Consolidated Balance Sheets, was $ 21.8 million at June 30, 2024 and $ 21.5 million at December 31, 2023.

Our AULC for commitments that are not unconditionally cancellable, which is included in other liabilities on the Consolidated Balance Sheets, was $ 22.4 million at September 30, 2024 and $ 21.5 million at December 31, 2023.

Additional information relating to the AULC is provided in Note 5, "Allowance for Credit Losses on Loans and Leases" in the Notes to Consolidated Financial Statements.

27 unchanged sentences

The assumptions used for this valuation include stock price volatility, risk-free interest rate and dividend yield.

We granted 1,249,783 and 1,354,017 restricted stock units during the six months ended June 30, 2024 and 2023, respectively, including 331,182 and 282,106 performance-based restricted stock units during those same periods, respectively.

We granted 1,271,502 and 1,426,146 restricted stock units during the nine months ended September 30, 2024 and 2023, respectively, including 334,082 and 290,764 performance-based restricted stock units during those same periods, respectively.

We have shareholder approval under the Plan to issue up to 14,000,000 shares of common stock, including 8,000,000 shares registered during the second quarter of 2024.

As of June 30, 2024, we had 9,106,891 remaining shares available for awards under the Plan.

As of September 30, 2024, we had 9,077,587 remaining shares available for awards under the Plan.

The unvested restricted stock unit awards are eligible to receive cash dividends or dividend equivalents which are ultimately used to purchase additional shares of stock and are subject to forfeiture if the requisite service period is not completed or the specified performance criteria are not met.

1 unchanged sentence

The following table summarizes the activity relating to restricted stock units during the periods indicated:

Six Months Ended June 30,

Nine Months Ended September 30,

Units Weighted

5 unchanged sentences

Forfeited/expired/canceled ( 40,377 ) 12.42 ( 605,383 ) 7.93

Dividend reinvestment — — 74,505 12.16

Unvested units outstanding at end of period 3,575,028 13.38 3,504,777 12.88

The following table provides certain information related to restricted stock units:

(in millions) Six Months Ended

(in millions) Nine Months Ended

September 30,

Stock-based compensation expense $ 15 $ 15

1 unchanged sentence

Fair value of units vested 19 18

As of June 30, 2024, there was $ 15.6 million of unrecognized compensation cost related to unvested restricted stock units.

The components of the restricted stock units as of June 30, 2024 are as follows:

As of September 30, 2024, there was $ 12.9 million of unrecognized compensation cost related to unvested restricted stock units.

The components of the restricted stock units as of September 30, 2024 are as follows:

(dollars in millions) Service-

7 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(dollars in millions) 2024 2023 2024 2023

10 unchanged sentences

Effective tax rate 21.4 11.5 21.5 17.4

Income tax expense was lower for the six months ended June 30, 2024 due to lower pre-tax earnings, partially offset by lower stock compensation vesting deductions, higher disallowance of FDIC premium deductions and higher levels of proportional amortization for certain tax credit investments resulting from the adoption of FASB ASU 2023-02 on January 1, 2024.

The effective tax rate increased for the three months ended June 30, 2024 as a result of these offsetting items.

Income tax expense was higher for the three and nine months ended September 30, 2024 driven by a renewable energy investment tax credit recognized as part of a solar project financing transaction that closed in September 2023.

The increase was also attributable, to a lesser extent from lower stock compensation vesting deductions, higher disallowance of FDIC

premium deductions and higher levels of proportional amortization for certain tax credit investments resulting from the adoption of FASB ASU 2023-02 on January 1, 2024.

The higher effective tax rate for the three and nine months ended September 30, 2024 compared to 2023 was primarily due to the renewable energy investment tax credits as part of a solar project financing transaction that closed in September 2023.

Deferred Income Taxes

1 unchanged sentence

Deferred tax assets and liabilities are measured based on the enacted tax rates that will apply in the years in which the temporary differences are expected to be recovered or paid.

Net deferred tax assets were $ 107.4 million and $ 120.8 million at June 30, 2024 and December 31, 2023, respectively.

Net deferred tax assets were $ 80.5 million and $ 120.8 million at September 30, 2024 and December 31, 2023, respectively.

OTHER COMPREHENSIVE INCOME (LOSS)

7 unchanged sentences

Obligations Total

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Balance at beginning of period $ ( 160 ) $ ( 33 ) $ ( 42 ) $ ( 235 )

1 unchanged sentence

Amounts reclassified from AOCI — 24 — 24

Net current period other comprehensive (loss) income ( 11 ) 3 — ( 8 )

Net current period other comprehensive income 62 18 1 81

Balance at end of period $ ( 98 ) $ ( 15 ) $ ( 41 ) $ ( 154 )

7 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

( dollars in millions, except per share data)

9 unchanged sentences

Diluted $ 0.30 $ 0.40 $ 0.96 $ 1.18

There were no anti-dilutive shares for the six months ended June 30, 2024 and 2023.

There were no anti-dilutive shares for the nine months ended September 30, 2024 and 2023.

CASH FLOW INFORMATION

Following is a summary of supplemental cash flow information:

Six Months Ended

Nine Months Ended

September 30,

(in millions) 2024 2023

2 unchanged sentences

Transfers of loans to other real estate owned 1 2

Loans transferred to held for sale from portfolio 431 —

Loans transferred to portfolio from held for sale 14 33

We did no t have any restricted cash as of June 30, 2024 and 2023.

We did no t have any restricted cash as of September 30, 2024 and 2023.

BUSINESS SEGMENTS

14 unchanged sentences

Other Consolidated

At or for the Three Months Ended June 30, 2024

At or for the Three Months Ended September 30, 2024

Interest income $ 581 $ — $ — $ 2 $ 583

10 unchanged sentences

Total intangibles 2,499 9 26 — 2,534

At or for the Three Months Ended June 30, 2023

At or for the Three Months Ended September 30, 2023

Interest income $ 512 $ — $ — $ 1 $ 513

15 unchanged sentences

Other Consolidated

At or for the Six Months Ended June 30, 2024

At or for the Nine Months Ended September 30, 2024

Interest income $ 1,678 $ — $ — $ 5 $ 1,683

10 unchanged sentences

Total intangibles 2,499 9 26 — 2,534

At or for the Six Months Ended June 30, 2023

At or for the Nine Months Ended September 30, 2023

Interest income $ 1,437 $ — $ — $ 4 $ 1,441

15 unchanged sentences

(in millions) Level 1 Level 2 Level 3 Total

June 30, 2024

September 30, 2024

Assets Measured at Fair Value

55 unchanged sentences

Commitments Total

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Balance at beginning of period $ — $ — $ 5 $ 5

13 unchanged sentences

Such reclassifications are reported as transfers in/out of Level 3 at fair value at the beginning of the period in which the changes occur.

During the first six months of 2024, $ 47.3 million in loans receivable were measured using the fair value option at Level 3 on a recurring basis.

There were no transfers of assets or liabilities between the hierarchy levels during the first six months of 2023.

During the first nine months of 2024, $ 49.2 million in loans receivable were measured using the fair value option at Level 3 on a recurring basis.

There were no transfers of assets or liabilities between the hierarchy levels during the first nine months of 2023.

From time to time, we measure certain assets at fair value on a non-recurring basis.

3 unchanged sentences

(in millions) Level 1 Level 2 Level 3 Total

June 30, 2024

September 30, 2024

Collateral dependent loans $ — $ — $ 100 $ 100

6 unchanged sentences

Other real estate owned — — 2 2

The fair value amounts for collateral dependent loans and OREO in the table above were estimated at a date during the six months or twelve months ended June 30, 2024 and December 31, 2023, respectively.

The fair value amounts for collateral dependent loans and OREO in the table above were estimated at a date during the nine months or twelve months ended September 30, 2024 and December 31, 2023, respectively.

Consequently, the fair value information presented is not necessarily as of the period’s end.

Collateral dependent loans measured or re-measured at fair value on a non-recurring basis during the six months ended June 30, 2024 had a carrying amount of $ 34.8 million, which includes an allocated ACL of $ 7.3 million.

The ACL includes a provision applicable to the current period fair value measurements of $ 7.1 million, which was included in provision for credit losses for the six months ended June 30, 2024.

MSRs measured at fair value on a non-recurring basis had a carrying value of $ 0.7 million, and there was no valuation allowance as of June 30, 2024.

Collateral dependent loans measured or re-measured at fair value on a non-recurring basis during the nine months ended September 30, 2024 had a carrying amount of $ 100.2 million, which includes an allocated ACL of $ 24.6 million.

The ACL includes a provision applicable to the current period fair value measurements of $ 39.9 million, which was included in provision for credit losses for the nine months ended September 30, 2024.

MSRs measured at fair value on a non-recurring basis had a carrying value of $ 12.5 million, and a valuation allowance of $ 2.8 million as of September 30, 2024.

The valuation allowance includes a provision of $ 2.6 million included in earnings for 2024.

5 unchanged sentences

Value Level 1 Level 2 Level 3

June 30, 2024

September 30, 2024

Financial Assets

28 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements