Regional banking company Fulton Financial (NASDAQ: FULT) reported revenue ahead of Wall Streets expectations in Q4 CY2025, with sales up 4.3% year on year to $340.4 million. Its non-GAAP profit of $0.55 per share was 7.8% above analysts’ consensus estimates.

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StockStory’s Take

Fulton Financial’s fourth quarter results were met with a positive market reaction, reflecting better-than-expected revenue and adjusted earnings per share. Management attributed these results to robust deposit growth, ongoing expense discipline, and improved credit quality. CEO Curtis Myers highlighted the company’s “momentum from enhanced deposit initiatives,” noting a 25% increase in consumer demand deposit account openings and strong loan origination trends. The expansion of both business banking teams and product offerings further supported the company’s performance, while noninterest income benefited from growth in commercial fees and wealth management activities.

Looking ahead, Fulton Financial’s management is focused on achieving mid-single-digit loan growth in 2026, supported by new hires across commercial and business banking. The company expects the headwinds from strategic portfolio repositioning in 2025 to subside, enabling a return to historical growth rates. CFO Richard Kraemer emphasized that “the impact of these activities will moderate as we move into 2026,” and management is confident in the company’s ability to generate sustainable balance sheet growth, with a diversified loan mix and continued investment in customer engagement and fee-generating services.

Key Insights from Management’s Remarks

Management credited fourth quarter performance to deposit growth, ongoing loan originations, and disciplined cost control while noting the impact of strategic portfolio actions and expanded noninterest income streams.

• Deposit growth acceleration: Management noted strong momentum in consumer and small business deposits, citing a 25% year-over-year increase in consumer demand deposit account openings and successful engagement initiatives that drove overall deposit balances higher.

• Business banking expansion: The expanded business banking team generated over $133 million in lower-cost operating deposits, with additional hiring in commercial and SBA lending supporting broader origination growth and pipeline momentum.

• Loan growth despite headwinds: Although strategic actions to derisk the loan portfolio created an $800 million headwind in 2025, organic loan originations still resulted in net loan growth and set the stage for increased originations in 2026 as these headwinds moderate.

• Noninterest income diversification: Noninterest income, excluding one-time items, increased by nearly 7% year-over-year, with broad-based growth in commercial fees and cash management (up 17%) and continued contributions from Fulton Financial Advisors, wealth management, and legacy Republic First client relationships.

• Expense discipline yields efficiency: Operating expenses grew by 1.9% in 2025, but when normalized for the Republic First acquisition, expenses would have declined 2.7%, supporting profitability and efficiency improvements. Management emphasized positive operating leverage from strategic initiatives and ongoing cost controls.

Drivers of Future Performance

Fulton Financial expects 2026 performance to be driven by renewed loan growth, ongoing deposit momentum, and continued expansion of fee-based income streams.

• Loan growth recovery: Management anticipates a return to historical mid-single-digit organic loan growth in 2026 as the portfolio repositioning headwinds from 2025 fade and new hires in business and commercial banking drive increased origination activity.

• Deposit and fee income strength: The company expects continued deposit growth and stable cost of funds, supported by consumer engagement strategies and treasury management, while noninterest income from wealth management, SBA, and cash management is projected to remain a key profitability driver.

• Acquisition integration and market expansion: The pending Blue Foundry Bancorp acquisition is expected to strengthen Fulton Financial’s presence in Northern New Jersey, providing opportunities to increase market share and customer relationships in attractive metropolitan areas, though integration and retention will be key execution risks.

Catalysts in Upcoming Quarters

In upcoming quarters, StockStory analysts will closely monitor (1) the pace and sustainability of loan growth as portfolio repositioning headwinds abate, (2) continued deposit inflows and effective management of funding costs, and (3) integration progress and early performance metrics from the Blue Foundry Bancorp acquisition. Execution in expanding fee-based businesses and maintaining credit quality will also be key areas of focus.

Fulton Financial currently trades at $20.26, down from $20.51 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free).

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