Wesbanco (NASDAQ:WSBC) released first-quarter financial results and hosted an earnings call on Wednesday. Read the complete transcript below.
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The full earnings call is available at https://event.choruscall.com/mediaframe/webcast.html?webcastid=2tR3k5XV
Summary
Wesbanco reported a 38% increase in diluted earnings per share to $0.91 and a 44% increase in pre-tax pre-provision earnings to $114 billion compared to the previous year.
The company achieved a net income of $87 million for common shareholders, excluding merger and restructuring charges, and maintained a solid capital position with a CET1 ratio of 10.7%.
Strategically, Wesbanco exceeded its financial targets for the Premier acquisition, continued its Southeastern expansion with a new team in South Florida, and opened new financial centers in high-growth markets.
Loan growth was recorded at 3.6% year over year, supported by a strong commercial pipeline, despite a $1 billion headwind from commercial real estate project payoffs over the past nine months.
The company anticipates mid-single-digit loan growth for 2026, supported by its expansion in South Florida and the increased commercial pipeline.
Management highlighted successful cost management with a slightly reduced operating expense from the previous quarter and strategic investments in digital capabilities and branch optimization.
Wesbanco plans to further expand its presence in Florida and other markets, with an emphasis on relationship-driven growth and adding local product capabilities.
Full Transcript
OPERATOR
Good day and welcome to the Wesbanco first quarter 2026 earnings conference call. All participants will be in listen only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to John Ioannone, Senior Vice President of Investor Relations. Please go ahead.
John Ioannone (Senior Vice President of Investor Relations)
Thank you. Good morning and welcome to Wesbanco Inc.’s first quarter 2026 earnings conference call. Leading the call today are Jeff Jackson, President and Chief Executive Officer and Dan Weiss, Senior Executive Vice President and Chief Financial Officer. Today’s Call, an archive of which will be available on our website for one year, contains forward looking information. Cautionary statements statements about this information and reconciliations of non-GAAP measures are included in our earnings related materials issued yesterday afternoon as well as our other SEC filings and investor materials. These materials are available on the Investor Relations Relations section of our website wesbanco.com all statements speak only as of April 22, 2026 and Wesbanco undertakes no obligation to update them. I would now turn the call over to Jeff.
Jeff Jackson (President and Chief Executive Officer)
Jeff Thanks John and good morning everyone. Today we’ll walk you through our first quarter performance and share our current outlook for the rest of 2026. There are three key takeaways from the quarter. We delivered solid year over year financial results. We exceeded our year one financial targets for the Premier acquisition and we stayed disciplined in executing our strategy to position Wesbanco for long term success. Overall, it was a solid start to the year. Turning to our financials for the quarter ended March 31, 2026, we reported net income available to common shareholders of 87 million excluding merger and restructuring charges. That translated to diluted earnings per share of $0.91, up 38% from a year ago. On a similar basis, we reported pre tax pre provision earnings of $114 billion, an increase of 44% year over year. The strength of our first quarter financial performance was reflected in our returns on average assets and tangible common equity of 1.3% and 17.4% respectively. Our capital position also remains solid with a CET1 ratio of 10.7%. That gives us flexibility to support growth and and navigate the operating environment ahead. As we mentioned last quarter, developers continue to seek permanent financing or the sale of properties during the first quarter. That drove elevated commercial real estate project payoffs which totaled 340 million during the first quarter and created a 1.4% headwind to our year over year loan growth. In fact, we have incurred a significant CRE payoff headwind of of a billion dollars during the last nine months. Despite that headwind, our teams continue to execute at a high level. Loan growth was largely funded by deposit growth and our commercial pipeline has reached all time record levels. Adjusting for the payoff activity, total loans grew 3.6% year over year. The commercial pipeline has increased 35% since year end to a record 1.6 billion and in the few weeks since quarter end the pipeline has grown another 200 million to 1.8 billion. About 45% of that pipeline is coming from existing loan production offices and the former Premier footprint. Impressively, this pipeline does not yet reflect the benefit of our recently announced South Florida expansion. That team has hit the ground running and built an initial $400 million pipeline just in a few weeks. They are on pace to grow that pipeline by a significant amount as the year progresses. Even with elevated CRE payoffs during the first half of the year and the potential of influence of geopolitical events, we continue to expect mid single digit year over year loan growth for 2026, supported by our record pipeline and early momentum from our South Florida markets. A little over a year ago we completed our transformative acquisition of Premier Financial, an acquisition that placed WestBanco among the 50 largest publicly traded banks in the U.S. when we announced the Premier acquisition in July 2024, we laid out clear financial targets for the first year including 40% earnings per share growth, a 1.3 return on average assets and a CET1 ratio of 9.6% along with a tangible book value earned back in under three years. I’m pleased to say we delivered and in many cases exceeded our targets. Over the last 12 months, core EPS growth reached 49% and ROAA was 1.3%. We also exceeded the pro forma CET1 ratio by more than a percentage point and shaved more than a year off the dilution earn back as our first quarter tangible book value per share of $22.45 is well above the June 2024 figure and nearly at the year end 2024 level. In addition, we have been making other strategic investments that demonstrate our commitment to long term sustainable growth. We continuously invest in digital capabilities and products like WestBanco One Account and Treasury Management Services to ensure we serve our customers how, when and where they want. At the same time, we continue to optimize our physical branch network. Over the past four years we’ve closed 64 locations with limited customer traffic, including 10 of them in Northern Ohio that will close next month. We’re selectively opening new financial centers in key markets and consolidating others into more central and higher demand locations. Our loan production office strategy continues to perform well. We’ve opened LPOs in high growth markets including Chattanooga, Indianapolis, Knoxville, Nashville and Northern Virginia. We’re seeing strong results as these teams deepen relationships and bring on new commercial clients. As these offices achieve scale, we add product capabilities locally as well as financial centers to better serve our growing client base. Chattanooga is a great example. We opened that LPO less than three years ago and it has generated strong relationship driven growth. That momentum supports the opening of our first Tennessee Financial center this week. We anticipate that several other of our LPOs will follow this pattern within the next couple of years. I’m very excited about our recent expansion into Florida which is a thoughtful extension of our long stated southeastern expansion strategy. Last month we announced the launch of our commercial banking business across key high growth South Florida markets starting with Palm beach and Broward Counties. We brought on a seasoned team of nearly 20 professionals including market leaders, commercial bankers, credit underwriting and a client relationship support as well as a Treasury management leader. These are attractive high growth markets and ones I’ve come to know well during my banking career. I’ve worked with many of these bankers before and they consistently delivered top performance while maintaining strong credit discipline. Just as importantly, their client focus aligns well with our relationship led approach. Our Florida expansion also provides meaningful organic growth opportunities for our strong healthcare banking vertical. As the regional business which is primarily focused on C and I lending develops, we will evaluate additional services and solutions including retail financial centers, treasury wealth management and mortgage offerings to deliver even a greater value to our clients. I would now like to turn the call over to Dan to walk through the financials and outlook in more detail. Dan thanks Jeff and good morning.
Dan Weiss (Senior Executive Vice President and Chief Financial Officer)
For the first quarter we reported GAAP net income available by common shareholders of $84 million or $0.88 per share and when excluding restructuring and merger related expenses, first quarter net income was $87 million or $0.91 per share. To highlight a few of the first quarter’s year over year accomplishments, we generated strong pre tax pre provisioned core earnings growth of 44%, grew core earnings per share by 38%, improved the net interest margin by 22 basis points and reduced the efficiency ratio by nearly 4 percentage points to 52.5%. Total assets of $27.5 billion include total portfolio loans of 19.1 billion and securities of 4.4 billion. Total portfolio loans increased 2.2% year over year driven by commercial real estate and home equity lending and declined slightly on a sequential quarter basis due to elevated payoffs. We expect commercial real estate payoffs to remain slightly elevated during the second quarter but at a lower level than the first quarter before returning to a more normal historical levels level during the back half of the year totaling 700 to 900 million dollars for the year. While very small, we ended our indirect auto program as it’s not core to our organic growth strategy and at quarter end it represented about half of the $325 million of consumer loan portfolio and anticipate that that portfolio will run off over the next three to five years. Deposits increased 2% year over year to $21.7 billion due to organic growth. We continue to be successful in remixing higher cost certificates deposit into interest bearing demand and of our remaining $2.7 billion certificate of deposit portfolio approximately 1 billion matures in each of the next two quarters with an average rate of 3.48% and 3.2% respectively. Our current seven month certificate of deposit rollover rate is 3.25%. Further, we started the year with $100 million in broker deposits, $50 million paid off early in the quarter while the last of our broker deposits paid off on April 1st. Credit quality continues to remain stable as key metrics have remained low from a historical perspective and favorable to all banks with assets between 20 and 50 billion over the last five quarters. Criticized and classified loans as a percentage of total portfolio loans decreased $49 million or 24 basis points from the sequential quarter to 2.9% while non performing loans increased 53 million sequentially primarily due to three CRE loans across different markets and property types, none of which were office the allowance for credit losses. The total portfolio loans at the end of the first quarter was 1.1% of total loans or $210 million. The decrease from the fourth quarter was primarily due to lower loan balances, faster prepayment speeds and macroeconomic factors. The first quarter margin of 3.57% improved 22 basis points year over year …
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