Greetings. And welcome to the F.N.B. Corporation First Quarter 2014 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. (Operator Instructions) As a remainder, this conference is being recorded. I’ll now turn the conference over to your host, Ms. Cindy Christopher, Manager of Investor Relations. Thank you, miss. You may now begin.

Thank you. Good morning, everyone, and welcome to our earnings call. This conference call of F.N.B. Corporation and the reports it files with the Securities and Exchange Commission often contain forward-looking statements. Please refer to the forward-looking statement disclosure contained in our earnings release, related presentation materials and in our reports and registration statements filed with the Securities and Exchange Commission and available on our corporate website. A replay of this call will be available until May 1st, and a transcript and the webcast link will be posted to the shareholder and Investor Relation section of our corporate website. I will now turn the call over to Vince Delie, President and Chief Executive Officer.

Good morning and welcome to our earnings call. Joining me today are Vince Calabrese, our Chief Financial Officer; and Gary Guerrieri, our Chief Credit Officer. I will be highlighting our operating performance and providing a strategic overview. Gary will review asset quality and Vince will provide further detail on our financial results along with an update on our expectations for the remainder of the year. Vince will then open the call for any questions. Let's begin by looking at the quarter, which include strong operating performance and a number of strategic accomplishments. I am proud of the results our team has delivered over the past several years and the first quarter is no exception. Operating net income available to common shareholders was $31 million or $0.19 per diluted share. This translates into 106 basis point return on average tangible assets and nearly a 15% return on average tangible common equity. The quarter also included a $9.5 million pre-tax gain on the sale of securities, which benefits capital and reported earnings. However, the gain is not included in our presentation of operating results. We are very pleased with our operating net income, given that there are several items that reduce results this quarter. If you recall, we completed a capital raise to improve F.N.B.’s capital structure under Basel III provisions. This is the first full quarter to reflect the impact of these actions, including the additional common shares issued and the dividend on the preferred issuance. We are also absorbing the Durbin related revenue loss as this is the third quarter since this became effective for F.N.B.. Lastly, and while less significant, as a result of state tax code revisions, our bank’s share tax increased on linked-quarter and year-over-year basis. On a combined basis, these items impacted first quarter earnings by…

Thank you, Vince and good morning everyone. We experienced continued favorable credit quality results in both our originated and acquired portfolios ending the first quarter of 2014 well positioned. I will first focus my commentary on the originated portfolio, which best represents our primary book of business, followed by some brief remarks on the acquired portfolio at which time I will touch on the credit impact of the recently completed BCSB acquisition. Let’s now turn to the originated book for a look at our results for the quarter. Originated NPLs and OREO ended March at 1.46% and remained nearly flat compared to year end, 1 basis point better when excluding the addition of $2.7 million in OREO from the BCSB acquisition. Delinquency further improved by 11 basis points to end the quarter at a very very good level of 1.17%, with the positive movement driven primarily by lower early-stage levels experienced in the mortgage portfolio. Net charge-offs totaled $5.6 million or 28 basis points annualized which was slightly better than our planned expectations and continues to trend in line with our performance over the last several quarters. The originated provision for loan losses at $7.9 million maintained our reserve position at 1.28%, as we continue to provide for solid loan growth results. Now if you shift your attention to our acquired portfolio, we ended the quarter with $1.6 billion of loans carried at fair value, including just over $300 million from the BCSB acquisition completed in February. As we have communicated to you in the past, we track and monitor our acquired book of loans very closely and we employed this same rigorous oversight to the BCSB transaction. At the end of the quarter, the level of delinquency in the acquired book totaled $96 million, and absent the addition of BCSB, would have been down $7 million, or 10% on a linked quarter basis. The acquired reserve realized the small benefit during the quarter, given the resolution of some problem credits as well as favorable credit trends that positively impacted the quarterly re-estimation results. In closing, we finished out the first quarter of 2014 slightly better than expected and are pleased with the position of the portfolio, as we move into the second quarter. As we continue to expand both organically and through acquisitions, we will continue to manage our growing loan book with the same balanced and consistent approach that has positioned the portfolio, as it stands today. I would now like to turn the call over to Vince Calabrese, our Chief Financial Officer for his remarks.

Thanks, Gary. Good morning, everyone. Today, I will review highlights of our first quarter’s operating performance and provide an update on guidance for the remainder of the year. Let’s begin by looking at the quarter’s balance sheet highlights, which include continued positive organic growth trends and the benefit from adding BCSB. Average loans grew organically $144 million, or 6.2% annualized, driven by strong commercial loan growth of $125 million, or 9.8% annualized. We have now achieved consistent linked quarter organic growth in the commercial portfolio for five years and continue to see momentum build. At the end of the quarter, commercial pipelines were at record highs. The consumer banking unit has also contributed significantly to total organic loan growth over the past several years, as a result of effective sales management and market expansion. In the first quarter, organic growth in average consumer loans was $43 million, or 5.7% annualized, even with the impact of the adverse weather on top of the normal seasonally right activity. On the funding side, while decreases in average total deposits, customer repos on an organic basis reflect the timing of typical seasonally low first quarter business balances. On a spot basis, these balances were up a strong, $230 million, or 10.8% annualized. As Vince noted, we continue to see strong organic growth in average non-interest bearing deposits, which was offset by decline in time deposits and the lower business balances. The first quarter net interest margin was 3.62%, compared to 3.67% in the prior quarter, with 4 basis points of the 5 basis point narrowing due to $1.1 million lower benefit from accretable yield. In other words, the core net interest margin only narrowed 1 basis point. First quarter accretable yield adjustments on acquired loans totaled $600,000 and were within our normal range of…

Thank you. (Operator Instructions) Our first question is coming from Bob Ramsey of FBR. Please proceed with your question.

Hey. Good morning, guys. This is actually Travis Potts in for Bob.

Hi, Travis.

Hey. First question, last quarter on NIM guidance you sort of said, run rate for accretable yield were around $500,000 to $750,000 a quarter. It looks like it was right around net of this quarter. I was wondering going forward obviously, there is going be choppiness there, but do you feel like there's still a good run rate going forward given recent acquisitions or has that changed?

No, I would say the $500,000 to $750,000 is still, that’s still a good run rate range for us and like you said, it will be lumpy depending on the estimations. But that’s kind of what I would consider the core levels still.

Okay. Great. And then on the efficiency ratio, you’ve mentioned mid 50s range, is that still the target pretty much overtime?

Yes.

Great. Thank you, guys.

Great. Thank you.

Thanks.

Thank you. Our next question is coming from Jason O'Donnell of Merion Capital Group. Please proceed with your question.

Good morning.

Good morning. How are you Jason?

Good. Good. I wanted to follow-up on the organic loan growth you posted this quarter, I think it was 6% annualized. That’s obviously a very good outcome given the winter we had and what we’re seeing out of a number of your counter parts in the region. Are there particular markets for you that are really driving that growth at this point and are you seeing it across the footprint?

I would say that the three metro markets that we’ve expanded into have been large contributors to the success, particularly in the tail-end of last year. As we move those assets through the pipeline, they end up being booked in the first quarter. So, I would say that we had fairly robust activity across the footprint but the three metro markets led the charge. They produced the most. Pittsburg, Cleveland and Baltimore in the Annapolis market were big contributors. And then actually as we sit today, our commercial pipeline is in a record $1.9 billion, so it’s very active.

Okay. That’s helpful. And then, I’ll just refresh my memory, is the guidance for, you guided for mid-to-high single digit loan growth for the year. Is that the same guidance you gave previously or has that been inched up a bit?

No, that’s still the same guidance.

Okay. Okay. And then just thinking about the margin little bit more, I’m wondering given the reduce interest expense tied to the trust preferred redemption you executed at the end of the first quarter, can we expect to see the margin? Should we expect to see the margin potentially increase into the second quarter and then come down from there, is that how we should be thinking about?

No, the guidance that I provided, I’m still looking for, as I said very slight narrowing, kind of by quarter. With interest rates still where they are at the short end of the curve, obviously that has an impact. And remember the banks that we’ve acquired were trust like that we brought on in the last couple of quarter. So that’s part of the, kind of the loan mix that we have today. So, no -- I would look for the margin, like I said very slight narrowing is the guidance that I gave. So, I wouldn’t expect to see that jump up in the second quarter, unless we have some accretable yield, re-estimation, extra impact that is possible but unexpected to sit here today.

Okay. Fair enough. And then one last one and I’ll hop out. (Indiscernible), your whole bank M&A strategy, given that your balance sheet here is pushing $15 million in assets inclusive of the OBA deal. Where is the asset for at this point in terms of new acquisitions that you’re willing to evaluate?

Well, the OBA transaction was smaller than what we’d like to do. But because of the capital benefits, it was attractive to us. So, I would say, we still look at same range. It would be larger than that transaction, half a billion or greater. But as I mentioned in my prepared remarks, when you look at the three transactions that we completed in the Maryland market in aggregation, it’s a fairly, it’s a meaningful presence and when you look at the price of the tangible book, it’s fairly attractive. So we’ve been able to put those three smaller institutions together and really we’re starting to see significant benefits as though we have acquired a larger institution. So having the presence in the market, having the scale to compete is starting to play out as we anticipated in our strategy.

And I would just add, we really don’t have a hard line. We’ve talked about a half a billion and up in the past. But I think that when you look at the last three, two of them have been under that in Annapolis and in OBA, both from accounting a little bit above that. I mean, the strategy of buying companies at this size, kind of folding it right into our sales culture and becoming the part of the company. I mean, it’s a lot of extra work, but it’s serving us very well, serving our shareholders well, so we’ll be opportunistic. The market share and the capital made this one work looking at for us and we’ll continue to be opportunistic.

From a talent perspective, we have truly replicated what we have done in Pittsburg, in Cleveland and in Baltimore. So we've gone out and we've attracted people from much larger institutions that have -- that are well connected, that have the sophistication necessary to deliver deeper product set. And we retained the people that we feel can operate effectively in that sales culture and it is really working exactly the way we anticipated. So we’re very pleased with our ability to attract people and drive our sales culture.

Understood. Thanks a lot guys.

Thank you.

(Operator Instructions) Our next question today is coming from Collyn Gilbert. Please proceed with your question. And you are with KBW.

Thanks. Good morning, guys.

Good morning, Collyn.

I just wanted to sort of reconcile with Baltimore County contribution if I could. What did they add to NII this quarter? And then what do you expect them to add next quarter?

Well, I would say, once you combined the companies Collyn, you can’t really pull out individual pieces of it. What I would say to you is that Baltimore County came in very close to what we expected it to be, which is around a couple million dollars worth net interest income for the first quarter, really very close. When you look at net interest income quarter-over-quarter, there’s really a few key drivers that you would have seen from the numbers, but you have lower accretable yield of $1.1 million. You have fewer days in the quarter, which was $1.8 million impact kind of fourth quarter to first quarter. And really overall, net interest income came in right on top of our expectation. So Baltimore County at $2 million or so in the first quarter, for half of a quarter, you can double that roughly and that would be good kind of estimation for the second quarter.

Okay. That helps. And then, we should also think about reversing that $1.8 million to normalize the share count into the second quarter as well. I mean, that’s not share count, sorry day count, sorry.

Right, perfect.

Okay. And then Vince, your guidance on the NIM, does that include the effects of OBAF?

No. It does not because OBAF is really closing so late in the year. And when you look at kind of their numbers coming in, it won’t have much of an impact on 2014. So my guidance was inclusive of everything else but without OBAF.

Okay.

If you look at kind of their run rate net income coming in is about a $1 million on an annualized basis. So won’t have that big of an impact on the total company’s results for the quarter.

Got it. Right. Okay. And then just one final question, I just want to make sure, I heard you guys right. On your mid to high single-digit loan growth rate that is organic, right? So that excludes the impact of Baltimore County and OBAF?

Yes. That's exactly.

Okay. Perfect. All right. That's all I had. Thanks.

Hey. Thank you.

(Operator instructions) Thank you. Our question is coming from Brian Martin of FIG Partners. Please proceed with your question.

Hi guys.

Hi, Brian.

Hi, Brian.

Maybe one question, when you talked about the mortgage projection being a little bit less as you move forward, but the overall guidance for consumer (indiscernible) is changed? Just kind of wondering what takes place to that particular decline in mortgage as you kind of look forward, are there areas more optimistic about now than you were earlier?

No. I would say that, I mean, the overall guidance, the change in mortgage banking isn’t going to change the overall guidance that we would give significantly, it obviously changes the dollars that we would receive. And we do have, as we commented in the first quarter, some of the fee businesses have been doing very well and they are contributing nicely. So, that clearly could offset a good portion of that. But, the overall guidance that I gave at -- with the single-digit reference, that doesn’t move that much.

Okay. All right. That's all I have. Thanks.

Thank you. Our next question is coming from Peter Winter of BMO. Please proceed with your questions.

Thanks. I was just looking at the non-interest income on page 15. The two items I wanted to talk about are services charges on deposit were little bit lower than I was expecting, I mean, I understand part of it is seasonality? I am just wondering if that weather played a role or if you are seeing any change in consumer behavior? And then also securities commission were little bit lower than what I was expecting?

Well, I would say, Peter that you are right on with the weather. I -- you heard mixed comment about it, but across our footprint, particularly in Maryland and Western Pennsylvania the weather was pretty severe. In fact there was one day were, if you count the BCSB branches, we had nearly 30 branches closed for one full day. So that’s -- I don’t know that’s ever happened in my career. So it was pretty severe. It seems like, at least from a pipeline perspective on the consumer side things have come back, so it started to work back in March. So from our perspective it had definitely had an impact. We keep people endorsed. They weren’t using their debit card. They weren’t conducting transaction. They weren’t engaging in borrowing activities. So it did slowed things down. In terms of the security commissions, when you look at the brokerage piece of our business, two things were happening. One was the weather. The second was we went through a conversion in the first quarter. So really the attention of the sales people was diverted to retaining clients and processing paperwork. So I know that’s seems like a simplistic answer, but its pretty labor intense and we would expect them to and it was already evident in March, things started to picked up again in that space as well.

Okay. That's perfect. Thanks.

Yeah. Thank you.

Yeah. Operator, I just wanted to clarify, right, the question that Brian had asked, my comment about it not affecting my guidance on fee income is just because of broadway that we’ve discussed. But I just wanted to clarify again, we do expect the mortgage banking to reduce EPS by about a penny a share for the last three quarter. So that fall through the bottom line which doesn’t change the broad overall guidance that I gave.

Thank you. At this time, I would like to turn the floor back over to Mr. Delie for any closing comments.

Well, I just like to say, I appreciate everybody calling in. There were some great questions. I feel we had a tremendous quarter. I think when you take a step back and you look at the company and how our company is positioned with revenue loan and deposit growth continuing, what’s the momentum there on all of those fronts, good asset quality, loan-to-deposit ratio of 85% which gives us plenty of liquidity to continue to grow, a solid efficiency ratio 59% coming in a little from fourth quarter which is very positive and shows that we can continue to manage expenses effectively despite the fact that we had a number of regulatory hits both from a revenue and expense prospective. We had additional capital. We added additional capital very strategically through the sale of the pooled trust preferred securities and with the recently announced acquisition of OBA. And that capital is invaluable to us to continue to perform at the level we are performing and support future growth and that growth as I have stated, we are very pleased with our ability to deploy our strategy and two additional major metro markets which truly positions this company to continue to perform at high level. And once we’ve absorbed the impact of those external factors in our run rate, looking at and reflecting back on the underlying key drivers to EPS expansion. If you look at it and just project the path forward, we should be able to perform at a very nice level and provide the shareholders with the benefits that they deserve. So we are very optimistic about it and we are very positive about where we sit today financially and really when you look at growth prospects. So that's all I really had to say and I appreciate everybody’s participation and I look forward to another good call next quarter. Thank you.

Ladies and gentlemen, thank you for your participation. This does concludes today's teleconference. You may disconnect your lines at this time and have a wonderful day.