First Citizens BancShares delivered a solid Q3 2024 result with revenue of $3.783 billion, EPS of $43.41, and net income of $639 million. The headline net interest margin (NIM) stood at 3.53%, with ex-accretion NIM at 3.33%, underscoring a relatively resilient margin despite ongoing deposit-cost pressures and lower accretion income. Revenue was up modestly year over year (+2.16%) and quarter over quarter (+2.05%), while operating income declined year over year due to higher operating expenses and credit-related costs. The bank benefited from a stable deposit base and continued loan growth in the General Bank and Commercial Bank segments, even as SVB Commercial loans declined by $2.1 billion sequentially. Management highlighted a strong capital and liquidity position, including a CET1 ratio of 13.24% at quarter-end and substantial buyback activity, with over $969 million of repurchases completed in the quarter as part of a broader program headlined by the board-approved $3.5 billion authorization.
From a credit perspective, net charge-offs rose modestly to 42 basis points, with the increase concentrated in the General Office portfolio of the Commercial Bank. The allowance coverage remained sound at 1.21%, aided by a reserve established for Hurricane Helene and marked improvements in some commercial portfolios. Management emphasized continued prudence in credit risk management and ongoing portfolio reviews. Looking ahead, management reiterated guidance for 4Q24 and the full year, noting expected headwinds to NII from rate moves and accretion tailwinds from loan balances. They expect NII for the full year to land in a range of $7.1–$7.2 billion, with continued pressure on loan accretion and a mid-to-high-50s% adjusted efficiency ratio in 2024. The near-term outlook features continued asset sensitivity to rates, with a trough in net interest income and margins projected for late-2025, and a plan to manage capital to a CET1 target range of approximately 10.5–11% by year-end 2025 via disciplined buybacks and balance sheet optimization. The combination of a durable deposit franchise, a historically strong capital base, and ongoing investments in risk and technology positions FCNCA to navigate near-term headwinds while remaining poised for longer-term value creation as the economy and investment activity recover.