Moody's Ratings has affirmed F.N.B. Corporation's long-term issuer rating at Baa2 and revised the outlook to stable from negative, the ratings agency said on Thursday. The move reflects what Moody's characterized as tangible improvements in capital and continued resilience in credit metrics.
Moody's reaffirmed several debt and deposit ratings across F.N.B.'s group, including the corporation's senior unsecured and subordinate local currency ratings at Baa2. The agency also affirmed the local currency deposit ratings for First National Bank of Pennsylvania at A2/Prime-1.
Central to Moody's assessment was a strengthening in the bank's capital position. F.N.B.'s common equity tier 1 ratio rose to 11.4% as of December 31, 2025, up from 10.6% a year earlier. Moody's described this increase as "a credit positive development," noting that the higher CET1 ratio enhances the institution's capacity to absorb losses.
On asset quality, Moody's observed stability. The bank continues to report low net charge-offs and carries an allowance for credit losses that exceeds recent loss experience by what the agency judged to be a comfortable margin.
Despite these favorable trends, Moody's highlighted constraints that temper the bank's flexibility. Elevated asset encumbrance was noted as limiting the usability of liquid resources. In addition, F.N.B. reports a higher proportion of uninsured deposits compared with some peers. Moody's added that this uninsured deposit ratio improves when collateralized municipal deposits are excluded from the calculation.
The agency spelled out conditions that would support a future upgrade. For Moody's to consider raising the rating, F.N.B. would need to increase its tangible common equity to risk-weighted assets (TCE/RWA) ratio to at least 13%, preserve a strong funding profile, improve liquidity, bolster earnings and continue to reduce its commercial real estate concentration.
Conversely, Moody's identified factors that could put ratings under downward pressure. Those include a deterioration of the bank's liquidity profile, a drop in the TCE ratio below 11% of risk-weighted assets, a material weakening of profitability, or a decline in asset quality.
Overall, Moody's change of outlook to stable reflects a balance between measurable capital strengthening and credit stability on one hand, and continuing constraints from encumbrance and deposit composition on the other. The agency's guidance lays out clear quantitative and qualitative thresholds that would be necessary for an upgrade or could precipitate downgrade pressure.
Summary
Moody's affirmed F.N.B.'s Baa2 issuer rating and moved the outlook to stable, citing higher CET1, steady asset quality and reduced commercial real estate concentration, while flagging elevated asset encumbrance and a relatively high share of uninsured deposits as ongoing constraints.
Key details
- Affirmed ratings include F.N.B. Corporation's senior unsecured and subordinate local currency ratings at Baa2 and First National Bank of Pennsylvania's local currency deposit ratings at A2/Prime-1.
- Common equity tier 1 ratio improved to 11.4% as of December 31, 2025, up from 10.6% a year earlier.
- Asset quality remains stable with low net charge-offs and an allowance for credit losses that exceeds recent losses.
What could change the rating
- Upgrade prerequisites: TCE/RWA of at least 13%, sustained funding strength, improved liquidity, stronger earnings and further reductions in commercial real estate concentration.
- Downgrade risks: weakening liquidity, TCE below 11% of RWA, materially lower profitability, or deteriorating asset quality.