Fulton Financial (NASDAQ:FULT) reported first-quarter 2026 operating earnings of $0.55 per diluted share, as management pointed to “strong revenue generation and prudent expense management” that produced positive operating leverage and an improved efficiency ratio.
Chairman, CEO and President Curt Myers said the quarter reflected “the strength of our foundation and the consistent execution of our strategy,” adding that the company continued to make progress by “growing the company, delivering effectively, and operating with excellence.”
Quarterly performance and profitability
Myers cited operating profitability metrics of 1.30% return on average assets and 14.76% return on tangible common equity. He also said pre-provision net revenue increased $9.2 million from the prior quarter to $141 million and that the efficiency ratio improved to 56.7%.
Net interest income, margin, and balance sheet trends
Net interest income totaled $262 million, down about $4 million from the fourth quarter, which Kraemer attributed largely to day-count effects. He said interest income declined due to “slightly lower loan and security yields,” while interest expense also fell as the company continued managing deposit pricing and improved its funding mix.
Fulton’s net interest margin was 3.58%, down one basis point from the prior quarter. Kraemer said margin performance reflected “underlying structural stability rather than short-term tactical actions,” with deposit pricing discipline largely offsetting asset yield pressure. He also noted that brokered balances declined further during the quarter and described the company’s interest rate risk profile as “relatively neutral.”
On funding, Kraemer said average deposit balances were stable while ending balances increased $179 million, driven by higher savings balances and an increase in non-interest-bearing demand deposits. Total cost of funds decreased nine basis points due to pricing actions and favorable mix.
Loan balances increased $121 million during the quarter, with Myers highlighting that growth was led primarily by commercial mortgage and included “an opportunistic purchase of an in-market commercial loan portfolio.” He said that was partially offset by lower construction balances and the planned runoff of the indirect auto portfolio. Kraemer added that credit spreads on originated loans “remained stable” and said the company continued to emphasize disciplined pricing and return thresholds.
Myers provided additional detail on the portfolio purchase in the Q&A, describing it as a “commercial portfolio right in the heart of our franchise” purchased from a “high-quality institution.” He said the portfolio was around $200 million with an average loan size of about $1.2 million and was “a pretty similar customer base to ours.”
In securities, Kraemer said the investment portfolio increased $28 million and remained 15% of total assets. He added that accumulated other comprehensive income increased $23 million during the quarter due to a late-March rise in interest rates.
Fees, expenses, and credit
Non-interest income was $69.8 million, “effectively flat” with the prior quarter, Kraemer said. Wealth management revenue increased and was partially offset by seasonal declines in other fee categories and the impact of two fewer days in the quarter. Myers said fee income grew more than 9% year over year across all businesses versus the first quarter of 2025, led by a 12% increase in wealth management, and again represented more than 20% of total revenue.
Non-interest expense totaled $200.3 million, down $12.7 million from the prior quarter, driven by lower incentive compensation and non-personnel cost discipline, partially offset by $2.6 million of acquisition-related expenses, Kraemer said. On an operating basis, expenses were $190.7 million. Asked about expense expectations, Kraemer said the company remained comfortable with its annual guidance and that it implied operating expenses rising from “that 191 operating base today on a standalone basis to something closer to 200 by the end of the year.”
On credit, the provision for credit losses was $14.4 million, resulting in an allowance for credit losses of $367.5 million, or 1.51% of total loans, Kraemer said. Non-performing assets improved to 55 basis points of total assets from 58 basis points in the fourth quarter, and net charge-offs were 25 basis points of average loans annualized. In the Q&A, management said classified and criticized assets continued to trend down and that credit metrics were stable or moving in a positive direction.
Blue Foundry acquisition, capital, and outlook
Myers and Kraemer highlighted the closing of Fulton’s acquisition of Blue Foundry Bancorp on April 1, which will be reflected in second-quarter results. Myers said the company’s focus is “thoughtful integration, supporting customers, aligning teams,” with integration planning progressing and efforts expected to be completed later in the summer.
Kraemer said the deal is expected to be “immediately earnings and tangible book accretive in line with previous expectations,” with revenue enhancements driven primarily by relationship expansion. In response to a question about margins following the close, Kraemer said directionally net interest margin should be higher as purchase accounting accretion begins in the second quarter, while also noting deposit repricing “is starting to trough” and pointing to upcoming fixed-rate asset repricing in the back book.
Management also discussed the strategic appeal of Blue Foundry’s Northern New Jersey presence. Myers said Fulton already had a small footprint in the market and that the acquisition “gets us in that market in a bigger way,” adding that Fulton sees opportunities to “go up market in real estate” as well as in wealth and mortgage. He said there was nothing on Blue Foundry’s balance sheet that Fulton planned to purposefully run off. Kraemer added that some of Blue Foundry’s originations had been brokered or third-party and that Fulton could “replace that with Fulton-originated paper,” which he said should help spreads and absolute yields.
On capital, Kraemer said the CET1 ratio increased to about 11.9% and the tangible common equity ratio improved to 8.6%. Fulton repurchased about $24.5 million of common stock during the quarter under its 2026 authorization. In the Q&A, management said it does not manage to specific capital ratio targets and views capital as “pretty robust,” prioritizing organic growth, flexibility for other opportunities, and opportunistic repurchases. Myers said $125 million remained under the authorization.
Looking ahead, Kraemer said Fulton affirmed full-year 2026 operating guidance, with the only change being an updated interest rate assumption to reflect a 25 basis point cut in July rather than March. He reiterated expectations for annualized mid-single-digit loan growth, controlled expense growth, and strong capital generation.
About Fulton Financial (NASDAQ:FULT)
Fulton Financial Corporation, trading on the NASDAQ under the ticker FULT, is the financial holding company for Fulton Bank, headquartered in Lancaster, Pennsylvania. The company delivers a broad range of banking and financial services through its subsidiary, Fulton Bank, targeting both individual and corporate clients. Fulton Financial’s offerings include deposit accounts, lending solutions, treasury management, and specialized banking services designed to support personal wealth goals and business growth initiatives.
Through Fulton Bank, the company provides retail banking services such as checking and savings accounts, consumer and residential mortgage loans, and home equity products.
