10-KPeriod: FY2021

FIRST CITIZENS BANCSHARES INC /DE/ Annual Report, Year Ended Dec 31, 2021

Filed February 25, 2022For Securities:FCNCAFCNCPFCNCBFCNCOFCNCN

Summary

First Citizens BancShares, Inc. (FCNCA) reported its 2021 annual results, highlighting the significant completion of its merger with CIT Group Inc. (CIT) on January 3, 2022. This merger is transformative, more than doubling the company's asset size and positioning it as a top-tier U.S. bank. The integration of CIT's nationwide commercial lending and digital banking capabilities with FCNCA's robust retail franchise is expected to yield substantial synergies and expand the company's market reach and product offerings. Financially, for the year ended December 31, 2021, FCNCA reported net income available to common shareholders of $528.9 million, or $53.88 per share, a notable increase from the previous year, despite a slight decrease in net interest margin due to balance sheet mix changes and lower yields. The company maintained a strong capital position with all regulatory capital ratios well above requirements. Credit quality remained robust with a low net charge-off ratio and a decrease in nonperforming assets. The company ended the year with substantial liquidity, providing a strong foundation for future growth and operational initiatives.

Financial Highlights

40 data points
Beta

Net Income

$547.00M

EPS (Diluted)

$53.88

Total Assets

$58.31B

Cash & Equivalents

$338.00M

Free Cash Flow

-$391.00M

Financial Statements
Beta
Interest Expense$61.00M
Net Income$547.00M
EPS (Basic)$53.88
EPS (Diluted)$53.88
Shares Outstanding (Basic)9.82M
Shares Outstanding (Diluted)9.82M

Key Highlights

  • 1Completed the significant merger with CIT Group Inc. on January 3, 2022, effectively doubling the company's asset size to over $100 billion.
  • 2Reported a net income available to common shareholders of $528.9 million ($53.88 per share) for the year ended December 31, 2021, an increase from the prior year.
  • 3Maintained strong regulatory capital ratios, with Total Risk-Based Capital at 14.35%, Tier 1 Risk-Based Capital at 12.47%, Common Equity Tier 1 at 11.50%, and Tier 1 Leverage at 7.59%, all exceeding Basel III minimums.
  • 4Demonstrated robust credit quality with a net charge-off to average loans ratio of 0.03% for 2021 and a decrease in nonperforming assets to 0.49% of total loans.
  • 5Ended the year with strong liquidity, reporting $16.41 billion in liquid assets and significant contingent liquidity sources.
  • 6Increased total deposits by 18.4% to $51.41 billion, driven by growth in demand, checking, and money market accounts, primarily from commercial customers.
  • 7Announced plans to eliminate NSF fees and significantly lower overdraft fees on consumer accounts starting mid-2022, responding to regulatory scrutiny and market trends.

Frequently Asked Questions

The most significant event was the completion of the merger with CIT Group Inc. on January 3, 2022. This transformative transaction more than doubled the company's asset size, creating a larger, more diversified financial institution.

For the year ended December 31, 2021, net income available to common shareholders was $528.9 million, or $53.88 per share, an increase from the prior year. The company maintained strong capital and liquidity positions.

The company noted that interest rates were near historical lows, which presented challenges. While the balance sheet is asset-sensitive, they aim to reduce volatility from interest rate movements. The net interest margin decreased in 2021 compared to 2020, primarily due to changes in earning asset mix and lower yields, partially offset by lower deposit rates.

The company maintains a strong focus on credit quality, with a low net charge-off ratio and a decrease in nonperforming assets. The allowance for credit losses was maintained at levels management believes are adequate, considering macroeconomic factors and loan portfolio performance.