First Citizens slips despite earnings beat

Published: 2026-04-24 03:09:38 ET FCNCA

First Citizens reported quarterly results that topped expectations, driven by robust adjusted EPS and strong deposit growth. However, a narrowing net interest margin and a slight deterioration in certain credit metrics weighed on the stock, which shed over 4% as the market opened.

Kevin Smith

Published on 04/24/2026 at 03:09 am EDT

First Citizens BancShares posted Q1 2026 results that generally exceeded forecasts, yet failed to fully reassure the market. The banking group generated net income of $534m, compared to $580m in the previous quarter, while adjusted EPS reached $44.86, well ahead of the $39.45 consensus. Total revenue, combining net interest income and non-interest income, came in at approximately $2.31bn, also surpassing market expectations.However, investors appear focused on two headwinds. First, pressure on the core profitability engine: net interest income fell 5.9% sequentially to $1.62bn, while the net interest margin contracted 11bp to 3.09%, impacted by lower yields on loans, securities, and cash held at banks. Second, while net charge-offs declined, the cost of risk trended higher (provision for credit losses of $72m, versus $54m) and non-performing loans rose slightly (0.96% compared to 0.88%), notably due to a few commercial real estate exposures.Conversely, the group benefited from solid balance sheet momentum. Deposits surged 5.7% during the quarter to $170.8bn, loan balances continued to grow, and borrowings decreased following a further $2.5bn early repayment of the Purchase Money Note. Looking ahead, the outlook will largely depend on First Citizens' ability to stabilize its interest margin while keeping credit quality under control.