First Commonwealth: 3 Key Takeaways for Long-Term Investors

On its third-quarter 2026 earnings call, held on Oct. 28, 2026, First Commonwealth (NYSE:FCF) reported core earnings per share of $0.45. For long-term investors, the bank's ability to trim deposit costs while expanding loan originations shows the underlying operational durability of its community franchise.

Three things management said stand out.

1. Deposit Costs Fall to Protect Profit Margins

Management expects its deposit beta, the percentage of central bank interest rate changes passed through to depositors, to remain near historical levels of 25% on non-maturity accounts without fixed expiration dates. Paying market rates on core accounts keeps deposit levels steady while protecting net interest margin, the gap between what the bank earns on loans and pays on deposits.

And that means we have to pay market rates for those deposits with the competition heating up in a rising rate environment, we expect our beta to be consistent with way we calculated our historical beta of 25%.
-- James R. Reske, Chief Financial Officer

2. Energy Tax Credits Provide Permanent Rate Savings

First Commonwealth purchased over $50 million in federal renewable energy tax credits to offset tax liabilities and fund credit loss provisions. Settling into an annual rhythm of credit purchases could reduce the bank's effective tax rate by 1 to 2 percentage points.

Once that is done and assuming the laws affecting the transferability federal renewable energy tax credits do not change, we will likely settle into a rhythm of purchasing tax credits like this every year.
-- James R. Reske, Chief Financial Officer

3. Share Buybacks Return Capital to Shareholders

The bank repurchased $88 million of stock during the quarter to optimize its tangible common ratio, a key measure of physical capital strength. Board authorization of an additional $25 million buyback program allows management to continue repurchasing shares from retained earnings.

We are also pleased to announce that our board has authorized an additional $25 million in repurchase authority. We intend to recommence share repurchases next week once we come out of blackout.
-- James R. Reske, Chief Financial Officer

Looking Ahead

Loan originations are rising across consumer and commercial categories as loan payoffs slow, driving loan volume higher. First Commonwealth relies on its regional branch footprint across Western Pennsylvania and Ohio alongside 35 fintech partnerships, or technology start-up agreements, to maintain pricing discipline and improve operating efficiency.

Additionally, consumer and commercial loan originations throughout the third quarter increased year over year. Loan payoffs also slowed for the first time in 5 quarters, leading to annualized loan growth of 2.6% in the quarter.
-- Thomas Michael Price, President and CEO

Long-term expansion depends on keeping loan growth in the mid-single digits while keeping loan-to-deposit ratios in the low 90% range. Management is focused on expanding technology investments, improving credit performance, and controlling expenses to build durable shareholder value.

Lastly, we believe a mission-driven community bank of our size remains important and relevant to our customers, communities, employees, and investors.
-- Thomas Michael Price, President and CEO

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