On October 24, 2024, First Citizens BancShares Inc (FCNCA, Financial) released its 8-K filing for the third quarter of 2024. The company reported earnings per share (EPS) of $43.42, falling short of the analyst estimate of $45.15. Revenue for the quarter was $2.45 billion, surpassing the estimated $2.39 billion.
Company Overview
First Citizens BancShares Inc is the bank holding company of First Citizens Bank & Trust Company. Founded as the Bank of Smithfield in North Carolina, it has expanded through branching and acquisitions. Operating in nearly half of the continental United States, it primarily takes deposits in the Carolinas. The bank's operations have been influenced by the Holding family, which holds significant executive and director positions. First Citizens provides a wide range of banking services, with net interest income as its main revenue source.
Performance and Challenges
The third quarter of 2024 saw First Citizens BancShares Inc (FCNCA, Financial) achieving a net income of $639 million, a decrease from $707 million in the previous quarter. The decline was attributed to acquisition-related expenses and intangible asset amortization. Despite these challenges, the company experienced resilient loan growth in its General Bank and Commercial Bank segments, although the SVB Commercial segment saw a decline due to higher repayment levels.
Financial Achievements
First Citizens BancShares Inc (FCNCA, Financial) reported a net interest income of $1.80 billion, a slight decrease from the previous quarter. The net interest margin was 3.53%, down from 3.64%. The company also repurchased over 350,000 shares of its Class A common stock for $700 million, demonstrating strong capital management.
Key Financial Metrics
| Metric | Q3 2024 | Q2 2024 |
|---|---|---|
| Net Income | $639 million | $707 million |
| EPS | $43.42 | $47.54 |
| Net Interest Income | $1.80 billion | $1.83 billion |
| Net Interest Margin | 3.53% | 3.64% |
Analysis and Insights
First Citizens BancShares Inc (FCNCA, Financial) demonstrated resilience in its core banking operations, with stable credit quality and strong capital and liquidity positions. The company's ability to maintain deposit growth, particularly in its Branch Network, highlights its competitive advantage in the innovation economy. However, the decline in the SVB Commercial segment and increased noninterest expenses pose challenges that need to be addressed to sustain growth.
Additional Details
The company's provision for credit losses increased to $117 million, reflecting changes in the macroeconomic forecast and specific reserves. Despite these challenges, First Citizens BancShares Inc (FCNCA, Financial) remains well-capitalized, with capital ratios exceeding regulatory requirements. The company's liquidity position also remains robust, with liquid assets totaling $58.36 billion.
Chairman and CEO Frank B. Holding, Jr. stated, "We posted another quarter of strong financial results, largely in line with our expectations. Loan growth remained resilient in both the General Bank and Commercial Bank segments, while loans in the SVB Commercial segment declined as Global Fund Banking repayment levels outpaced draw activity."
Explore the complete 8-K earnings release (here) from First Citizens BancShares Inc for further details.
