First Financial Bancorp (NASDAQ: FFBC) stock fell over 3.3% on April 21st, 2020 (as of 1:41 pm GMT-4 ; Source: Google finance) as the company posted lower than expected results for the first quarter of FY 20. For the first quarter of FY 20 ended March 31, 2020, the Company reported has net income of $28.6 million, compared to net income of $48.7 million, for the fourth quarter of 2019 and $45.8 million, for the first quarter of 2019. Return on average assets for the first quarter of 2020 had fallen to 0.79% while return on average tangible common equity was 9.71% compared to returns on average assets of 1.34% and 1.33%, and returns on average tangible common equity of 15.84% and 15.95%, in the fourth quarter of 2019 and the first quarter of 2019, respectively. To date, credit stress on the loan portfolio were limited, which is marked by net recoveries during the period, however the quarterly provision expense reflects the company’s expectation for that to change during the remainder of the year.
Furthermore, in response to the pandemic, the company was able to immediately shift to crisis management, worked to develop plans and products for assisting the clients. The company the developed the Hardship Relief program, which includes various payment deferral options for borrowers, made the $1.0 million contribution to help fund COVID-19 relief efforts in communities throughout the footprint. Therefore, the company processed modifications for more than $950 million, or 10% of total loans and had successfully modified more than $45 million in consumer loans The company is also actively engaged in extending loans under the U.S. Government’s Paycheck Protection Program to the loan and deposit customers.
FFBC in the first quarter of FY 20 has reported the adjusted earnings per share of 31 cents, missing the analysts’ estimates for the adjusted earnings per share of 40 cents, according to analysts surveyed by Zacks Investment Research. The company had reported the adjusted revenue of $149.7 million in the first quarter of FY 20, missing the analysts’ estimates for revenue of $153.3 million.
Moreover, during the first quarter 2020, the loan balances grew 4.6% on an annualized basis, which reflects $106.2 million increase compared to the linked quarter due to commercial real estate. The company during the period posted the net interest margin of 3.77% on a fully tax-equivalent basis, which reflects 12 basis point reduction from the linked quarter.