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Fulton Financial Corp. (NASDAQ:FULT) shares experienced a 4.1% decline in after-hours trading on Tuesday, following a decrease in the bank’s net interest income during the fourth quarter, which impacted earnings.
Operating net income per share, at $0.42, exceeded the $0.40 consensus but decreased from the previous quarter’s $0.43 and the previous year’s $0.48.
Net interest income stood at $212 million, a decline from $213.8 million in Q3 and $225.9 million in Q4 of 2022. The decrease was primarily attributed to an increase in the rate on average interest-bearing deposits, a shift in the funding mix from noninterest-bearing demand deposits to interest-bearing deposits, and higher loan yields. This was partially offset by a lower rate on borrowings and other interest-bearing liabilities, an increase in the average balance of net loans, and a decrease in the average balance of borrowings and other interest-bearing liabilities.
Net interest margin declined to 3.36% from 3.40% in Q3 and 3.69% in Q4 of the previous year.
Interest expense on interest-bearing liabilities rose to $126.1 million from $116.5 million in Q3. Similarly, noninterest expense increased to $180.6 million from $171 million in Q3.
The provision for credit losses decreased to $9.81 million from $9.94 million in Q3 and $14.5 million a year earlier.
Prior to this, Fulton Financial reported a Non-GAAP EPS of $0.42, beating estimates by $0.02, and revenue of $271.38 million, surpassing expectations by $2.68 million.
