Core Insights - Citizens Financial Group, Inc. reported a 19% increase in earnings per share (EPS) to $0.92 for Q2 2025, driven by a 3.3% growth in net interest income (NII) and a 10% increase in fee income quarter-over-quarter [1][2] - The company executed $200 million in share repurchases and achieved record private bank loan growth of $1.2 billion, maintaining strong credit metrics while reaffirming its full-year and medium-term targets [2][3] Financial Performance - The private bank segment reached a quarterly high, adding $1.2 billion in loans, resulting in period-end balances of $4.9 billion and average deposits growing by $966 million, contributing $0.06 to EPS [3][4] - Net interest margin (NIM) expanded by five basis points to 2.95%, supported by lower funding costs and optimization in deposit pricing [8][10] Strategic Initiatives - The company launched a multiyear "reimagining the bank" initiative aimed at overhauling operating models and customer engagement through the adoption of AI and organizational redesign [5][6] - Successful execution of this initiative could significantly alter long-term expense trajectories and enhance the bank's competitive position in the digital transformation landscape [7] Guidance and Outlook - Management guided for a 3% to 4% increase in net interest income for Q3, with NIM expected to rise by approximately five basis points [11] - Full-year guidance for 2025 remains unchanged, with a projected ROTCE of 16%-18% and targeted NIM of 3.05%-3.10% for Q4 2025 [12]

Core Viewpoint - Citizens Financial Group (CFG) reported strong second-quarter 2025 adjusted earnings per share of 92 cents, exceeding estimates and reflecting a 12.2% year-over-year increase, driven by higher non-interest income and net interest income (NII) [1][9] Financial Performance - Net income on a GAAP basis was $436 million, marking an 11.2% increase from the prior-year quarter [2] - Total revenues for the quarter reached $2.04 billion, surpassing estimates by 1.5% and showing a 3.8% year-over-year growth [3][9] - NII increased by 2% year over year to $1.44 billion, supported by a higher net interest margin and an increase in average interest-earning assets [3] - The net interest margin (NIM) expanded by 5 basis points year over year to 2.95%, attributed to lower deposit costs and favorable fixed-rate asset repricing [4] - Non-interest income rose 8% year over year to $600 million, driven by increased capital markets fees, wealth fees, card fees, and mortgage banking income [4] Expense Management - Non-interest expenses increased by 1% year over year to $1.32 billion, primarily due to higher operating expenses and technology-related costs [5] - The efficiency ratio improved to 64.8%, down from 66.3% in the year-ago quarter, indicating enhanced profitability [5] Loan and Deposit Trends - As of June 30, 2025, total loans and leases were $139.3 billion, up 1.2% from the prior-year quarter, while total deposits declined by 1.4% to $175.1 billion [6][9] Credit Quality - The provision for credit losses was $164 million, a decline of 9.9% from the year-ago quarter, with net charge-offs decreasing by 9% to $167 million [7] - The allowance for credit losses decreased by 4% year over year to $2.21 billion, and non-accrual loans and leases slightly declined to $1.52 billion [7] Capital Position - As of June 30, 2025, the tier 1 leverage ratio remained stable at 9.4%, while the common equity tier 1 capital ratio decreased to 10.6% from 10.7% in the prior-year quarter [8][10] Shareholder Returns - In Q2 2025, CFG repurchased $200 million of common shares and distributed $185 million in common dividends [11]

Peacock. >> Welcome back. Take a look at Citizens Financial Group higher this morning.After a beat on the top and bottom lines, with net interest income in line with expectations, forecasting a constructive environment heading into the second half. Joining us now in a CNBC exclusive interview is Citizens Financial Group CEO Bruce Benson. You know, Bruce, if we told you, you know, in early April that all regional banks, big banks are going to report healthy numbers, improving outlooks and confidence, it woul ...

Financial Data and Key Metrics Changes - The company reported a strong net interest income (NII) growth of 3.3% sequentially, driven by a net interest margin (NIM) expansion of five basis points to 2.95% [6][12][15] - Earnings per share (EPS) for the second quarter was $0.92, reflecting a $0.15 or 19% improvement over Q1 [12] - The company executed $200 million in stock buybacks during the quarter, returning a total of $385 million to shareholders [14][26] Business Line Data and Key Metrics Changes - The Private Bank experienced its strongest loan growth quarter, adding $1.2 billion in loans, contributing $0.06 to EPS, up from $0.04 in the prior quarter [14][27] - Fees increased by 10% linked quarter, with wealth and card fees reaching record levels [13][15] - The card business also delivered a record quarter driven by seasonal improvements in purchase volumes [18] Market Data and Key Metrics Changes - The company noted a favorable credit trend with net charge-offs decreasing to 48 basis points from 51 basis points in the prior quarter [22][23] - Non-accrual loans decreased by 4% linked quarter, indicating improving credit quality [23] - Average deposits were up 1%, driven by increases in lower-cost categories across consumer and the private bank [21] Company Strategy and Development Direction - The company is focused on a multi-year initiative called "Reimagining the Bank," aimed at redesigning customer service and operational efficiency through new technologies like AI [9][10][27] - The strategic emphasis includes building a transformed consumer bank, a well-positioned commercial bank, and a premier private bank and wealth franchise [26] - The company remains on track to achieve over 5% accretion to its bottom line and a return on equity (ROE) of over 20% in 2025 [9][28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about economic conditions and market trends, anticipating a favorable environment for loan demand and deal activity in the second half of the year [10][11] - The company is comfortable with its full-year guidance for 2025, expecting continued momentum in its strategic initiatives [11][30] - Management highlighted the importance of maintaining a fortress balance sheet to navigate economic cycles and capitalize on opportunities [81] Other Important Information - The company is experiencing strong growth in its private banking segment, with a significant increase in assets under management (AUM) [27][28] - The company is also seeing a positive trend in its capital markets business, with a strong pipeline of deals expected to close in the upcoming quarters [7][10] Q&A Session Summary Question: Loan growth dynamics in the private bank - Management noted that all three business segments (commercial, consumer, private bank) experienced net loan growth, with a constructive outlook for the second half of the year [36][38] Question: NIM expectations in a dovish Fed environment - Management discussed strategies to lock in higher net interest margins, including opportunistic hedging to protect against downside risks [56][59] Question: Strategy for deposits and growth outlook - Management emphasized the importance of low-cost deposit trends and the ability to grow deposits to support loan growth while optimizing the mix [67][69] Question: Capital requirements and rating agency perspectives - Management indicated that while regional banks have built capital conservatively, there is potential for capital requirements to adjust as profitability improves [78][80] Question: Details on the "Reimagining the Bank" initiative - Management explained that this initiative aims to leverage new technologies to enhance customer service and operational efficiency, with a focus on long-term growth [85][89]

Financial Data and Key Metrics Changes - The company reported strong financial results for the second quarter, with net interest income (NII) growth of 3.3% sequentially, driven by a net interest margin (NIM) expansion of five basis points [4][9] - Earnings per share (EPS) for the quarter was $0.92, reflecting a $0.15 or 19% improvement over the previous quarter [9] - Operating leverage improved by 500 basis points, with expenses broadly flat [4][9] Business Line Data and Key Metrics Changes - The Private Bank experienced strong loan growth, adding $1.2 billion in loans, contributing $0.06 to EPS, up from $0.04 in the prior quarter [11][25] - Wealth and card fees increased significantly, with record levels achieved in the quarter [10][13] - Mortgage revenue growth was attributed to an improvement in mortgage servicing rights (MSR) valuation and seasonal production increases [10][14] Market Data and Key Metrics Changes - The company noted a favorable credit trend, with net charge-offs decreasing to 48 basis points from 51 basis points in the prior quarter [18] - Non-accrual loans decreased by 4% linked quarter, indicating improving credit quality [19] - The company maintained a strong capital position with a CET1 ratio of 10.6% and executed $200 million in stock buybacks during the quarter [11][22] Company Strategy and Development Direction - The company is focused on a multi-year initiative called "Reimagining the Bank," aimed at redesigning customer service and operational efficiency through new technologies like AI [6][23] - The strategic focus includes transforming the consumer bank, enhancing the commercial bank's positioning, and building a premier private bank and wealth franchise [22] - The company remains on track to achieve over 5% accretion to its bottom line and a return on equity (ROE) of over 20% in 2025 [6][25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about economic conditions and market trends, anticipating favorable conditions for the second half of the year despite uncertainties around tariffs [7][8] - The company expects to maintain its full-year guidance for 2025, with a clear path to achieving its ROTCE target of 16% to 18% [27] - Management highlighted the importance of executing on strategic initiatives and controlling factors within their influence [8][22] Other Important Information - The company reported a strong pipeline for capital markets, expecting to record over $30 million in fees from delayed M&A deals in July [5][13] - The company is focused on optimizing its deposit funding, with a notable increase in non-interest-bearing deposits [17][66] - The allowance for credit losses was slightly down to 1.59%, reflecting an improving portfolio mix [20] Q&A Session Summary Question: Loan growth in the quarter - Management noted that all three business segments (commercial, consumer, private bank) experienced net loan growth, with a constructive outlook for the second half of the year [34][35] Question: NIM expectations in a dovish Fed environment - Management indicated confidence in maintaining NIM expectations, with hedging strategies in place to protect against downside risks [54][56] Question: Strategy for the second half of the year - Management emphasized a focus on both growth and optimizing the deposit mix, with strong performance in low-cost deposits [64][66] Question: Capital strategy and rating agency considerations - Management discussed the importance of maintaining a conservative capital structure while being optimistic about future capital requirements [78][81] Question: Reimagining the Bank initiative - Management explained that this initiative aims to leverage new technologies and improve operational efficiency, with a dedicated team leading the effort [84][86]

Financial Performance Highlights - Net income available to common stockholders was $402 million[8], an 18% increase quarter-over-quarter and an 13% increase year-over-year[8] - Diluted earnings per share (EPS) reached $0.92[8], a 19% increase quarter-over-quarter and an 18% increase year-over-year[8] - Total revenue was $2037 million[8], a 5% increase quarter-over-quarter and a 4% increase year-over-year[8] - The efficiency ratio improved to 64.8%[8] - Return on tangible common equity (ROTCE) was 11.0%[8] Key Business Segment Performance - Private Bank contributed $0.06 to EPS[11], up $0.02 quarter-over-quarter[11], and is expected to deliver a ~20 to 24% return on equity for FY2025[11] - Net interest income (NII) was $1437 million[8], up 3% quarter-over-quarter and 2% year-over-year[8] - Noninterest income was $600 million[8], up 10% quarter-over-quarter and 8% year-over-year[8] Balance Sheet and Capital Management - Average deposits increased by 1% quarter-over-quarter to $174.1 billion[8] - The CET1 ratio remained strong at 10.6%[11] - The company repurchased $200 million of common stock at a weighted-average price of $39.00[45]

[Consolidated Financial Highlights](index=3&type=section&id=Consolidated%20Financial%20Highlights) This section summarizes key financial performance indicators, including operating data, per-share metrics, and capital ratios [Selected Operating Data](index=3&type=section&id=Selected%20Operating%20Data) The company reported strong 2Q25 financial performance, with total revenue increasing 5% QoQ and net income growing 17% QoQ | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :----------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total revenue | $2,037 | $1,935 | $1,963 | $102 | 5% | $74 | 4% | | Noninterest expense | 1,319 | 1,314 | 1,301 | 5 | — | 18 | 1% | | Pre-provision profit | 718 | 621 | 662 | 97 | 16% | 56 | 8% | | Provision for credit losses | 164 | 153 | 182 | 11 | 7% | (18) | (10%) | | NET INCOME | 436 | 373 | 392 | 63 | 17% | 44 | 11% | - For the six months ended June 30, 2025, total revenue increased by **1%** to **$3,972 million**, and net income grew by **11%** to **$809 million** compared to the same period in 2024[4](index=4&type=chunk) [Per Common Share Data](index=3&type=section&id=Per%20Common%20Share%20Data) Diluted earnings per common share significantly increased QoQ and YoY, alongside healthy growth in book and tangible book values | Metric | 2Q25 | 1Q25 | 2Q24 | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :----- | :----- | :----- | :------------- | :------------- | :------------- | :------------- | | Diluted earnings | $0.92 | $0.77 | $0.78 | $0.15 | 19% | $0.14 | 18% | | Book value per common share | 53.43 | 51.99 | 48.03 | 1.44 | 3% | 5.40 | 11% | | Tangible book value per common share | 35.23 | 33.97 | 30.61 | 1.26 | 4% | 4.62 | 15% | | Cash dividends declared and paid per common share | 0.42 | 0.42 | 0.42 | — | — | — | — | - The dividend payout ratio decreased to **45%** in 2Q25 from **54%** in 1Q25 and **53%** in 2Q24, indicating improved earnings coverage for dividends[4](index=4&type=chunk) [Common Shares Outstanding](index=3&type=section&id=Common%20Shares%20Outstanding) Common shares outstanding decreased QoQ and YoY, positively impacting per-share metrics | Metric | 2Q25 | 1Q25 | 2Q24 | QoQ Change | QoQ Change (%) | YoY Change | YoY Change (%) | | :-------------------------- | :----------- | :----------- | :----------- | :----------- | :------------- | :----------- | :------------- | | Average Basic Shares | 433,640,210 | 438,320,757 | 454,142,489 | (4,680,547) | (1%) | (20,502,279) | (5%) | | Average Diluted Shares | 436,539,774 | 442,200,180 | 456,561,022 | (5,660,406) | (1%) | (20,021,248) | (4%) | | Common shares at period-end | 432,768,811 | 437,668,127 | 452,961,853 | (4,899,316) | (1%) | (20,193,042) | (4%) | [Financial Ratios](index=4&type=section&id=Financial%20Ratios) Key financial ratios improved in 2Q25, with increased net interest margin and decreased efficiency ratio, indicating better profitability | Metric | 2Q25 | 1Q25 | 2Q24 | QoQ Change (bps) | YoY Change (bps) | | :--------------------------------- | :----- | :----- | :----- | :--------------- | :--------------- | | Net interest margin (FTE) | 2.95% | 2.90% | 2.87% | 5 | 8 | | Return on average common equity | 7.18% | 6.21% | 6.70% | 97 | 48 | | Return on average tangible common equity | 11.05% | 9.64% | 10.61% | 141 | 44 | | Return on average total assets | 0.80% | 0.70% | 0.72% | 10 | 8 | | Efficiency ratio | 64.76 | 67.91 | 66.27 | (315) | (151) | | Noninterest income as a % of total revenue | 29.41 | 28.14 | 28.16 | 127 | 125 | - The effective income tax rate increased to **21.37%** in 2Q25 from **20.26%** in 1Q25 and **18.49%** in 2Q24[5](index=5&type=chunk) [Capital Ratios - Period-End (Preliminary)](index=4&type=section&id=Capital%20Ratios%20-%20Period-End%20%28Preliminary%29) Capital ratios remained stable or slightly improved, maintaining a strong capital position with CET1 ratio at 10.6% | Metric | 2Q25 | 1Q25 | 2Q24 | | :-------------------- | :----- | :----- | :----- | | CET1 capital ratio | 10.6% | 10.6% | 10.7% | | Tier 1 capital ratio | 11.9 | 11.9 | 12.0 | | Total capital ratio | 13.8 | 13.9 | 14.0 | | Tier 1 leverage ratio | 9.4 | 9.4 | 9.4 | | Common equity ratio | 10.6 | 10.3 | 9.9 | | Tangible common equity ratio | 7.2 | 7.0 | 6.5 | [Selected Balance Sheet Data](index=4&type=section&id=Selected%20Balance%20Sheet%20Data) Loan-to-deposit ratio increased QoQ but decreased YoY, while full-time equivalent colleagues increased | Metric | 2Q25 | 1Q25 | 2Q24 | QoQ Change (bps) | YoY Change (bps) | | :--------------------------------- | :----- | :----- | :----- | :--------------- | :--------------- | | Loan-to-deposit ratio (period-end) | 79.56% | 77.51% | 80.43% | 205 | (87) | | Loan-to-deposit ratio (average) | 79.72 | 80.89 | 82.38 | (117) | (266) | | Full-time equivalent colleagues (period-end) | 17,677 | 17,315 | 17,510 | 362 | 167 | [Consolidated Statements of Operations (unaudited)](index=5&type=section&id=Consolidated%20Statements%20of%20Operations%20%28unaudited%29) This section details the company's consolidated statements of operations, focusing on interest and noninterest income and expenses [Interest Income and Expense](index=5&type=section&id=Interest%20Income%20and%20Expense) Total interest income increased QoQ but decreased YoY, while net interest income slightly increased QoQ and decreased YoY | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total interest income | $2,407 | $2,352 | $2,575 | $55 | 2% | ($168) | (7%) | | Interest and fees on loans and leases | 1,851 | 1,829 | 2,011 | 22 | 1% | (160) | (8%) | | Total interest expense | 970 | 961 | 1,165 | 9 | 1% | (195) | (17%) | | Deposits interest expense | 802 | 795 | 965 | 7 | 1% | (163) | (17%) | | Net interest income | 1,437 | 1,391 | 1,410 | 46 | 3% | 27 | 2% | - For the six months ended June 30, 2025, total interest income decreased by **8%** and total interest expense decreased by **17%** compared to 2024, resulting in a **1%** decrease in net interest income[6](index=6&type=chunk) [Noninterest Income and Expense](index=5&type=section&id=Noninterest%20Income%20and%20Expense) Noninterest income grew strongly QoQ and YoY, driven by mortgage banking fees, while noninterest expense remained stable | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total noninterest income | $600 | $544 | $553 | $56 | 10% | $47 | 8% | | Mortgage banking fees | 73 | 59 | 54 | 14 | 24% | 19 | 35% | | Other income | 42 | 22 | 10 | 20 | 91% | 32 | NM | | Total noninterest expense | 1,319 | 1,314 | 1,301 | 5 | — | 18 | 1% | | Salaries and employee benefits | 681 | 696 | 645 | (15) | (2%) | 36 | 6% | - For the six months ended June 30, 2025, total noninterest income increased by **7%** to **$1,144 million**, while total noninterest expense decreased by **1%** to **$2,633 million** compared to 2024[6](index=6&type=chunk) [Consolidated Balance Sheets (unaudited)](index=6&type=section&id=Consolidated%20Balance%20Sheets%20%28unaudited%29) This section presents the company's consolidated balance sheets, detailing assets, liabilities, and stockholders' equity [Assets](index=6&type=section&id=Assets) Total assets decreased slightly QoQ and YoY, with loans and leases showing modest QoQ growth but a YoY decline | Metric | June 30, 2025 ($ Millions) | Mar 31, 2025 ($ Millions) | June 30, 2024 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :--------------------------------- | :------------------------- | :------------------------- | :------------------------- | :------------- | :------------- | :------------- | :------------- | | TOTAL ASSETS | $218,310 | $220,148 | $219,938 | ($1,838) | (1%) | ($1,628) | (1%) | | Loans and leases | 139,304 | 137,635 | 141,842 | 1,669 | 1% | (2,538) | (2%) | | Loans held for sale | 2,093 | 2,820 | 683 | (727) | (26%) | 1,410 | 206% | | Debt securities available for sale | 34,658 | 34,208 | 31,938 | 450 | 1% | 2,720 | 9% | [Liabilities and Stockholders' Equity](index=6&type=section&id=Liabilities%20and%20Stockholders%27%20Equity) Total deposits decreased QoQ and YoY, while stockholders' equity increased, driven by retained earnings and comprehensive income | Metric | June 30, 2025 ($ Millions) | Mar 31, 2025 ($ Millions) | June 30, 2024 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :--------------------------------- | :------------------------- | :------------------------- | :------------------------- | :------------- | :------------- | :------------- | :------------- | | Total deposits | $175,086 | $177,576 | $176,352 | ($2,490) | (1%) | ($1,266) | (1%) | | Noninterest-bearing deposits | 38,001 | 37,556 | 36,927 | 445 | 1% | 1,074 | 3% | | Interest-bearing deposits | 137,085 | 140,020 | 139,425 | (2,935) | (2%) | (2,340) | (2%) | | Total long-term borrowed funds | 12,526 | 12,267 | 13,082 | 259 | 2% | (556) | (4%) | | TOTAL LIABILITIES | 193,076 | 195,282 | 196,069 | (2,206) | (1%) | (2,993) | (2%) | | TOTAL STOCKHOLDERS' EQUITY | 25,234 | 24,866 | 23,869 | 368 | 1% | 1,365 | 6% | | Retained earnings | 10,783 | 10,566 | 10,079 | 217 | 2% | 704 | 7% | [Loans and Deposits](index=7&type=section&id=Loans%20and%20Deposits) This section provides a detailed breakdown of the company's loan and deposit portfolios by category [Loans and Leases Breakdown](index=7&type=section&id=Loans%20and%20Leases%20Breakdown) Total loans and leases increased QoQ but decreased YoY, with commercial growth offsetting retail declines | Loan Category | June 30, 2025 ($ Millions) | Mar 31, 2025 ($ Millions) | June 30, 2024 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :---------------------- | :------------------------- | :------------------------- | :------------------------- | :------------- | :------------- | :------------- | :------------- | | Commercial and industrial | $45,412 | $43,781 | $43,623 | $1,631 | 4% | $1,789 | 4% | | Commercial real estate | 26,230 | 26,727 | 28,311 | (497) | (2%) | (2,081) | (7%) | | Total commercial | 71,642 | 70,508 | 71,934 | 1,134 | 2% | (292) | — | | Residential mortgages | 33,823 | 33,114 | 31,890 | 709 | 2% | 1,933 | 6% | | Home equity | 17,711 | 16,853 | 15,534 | 858 | 5% | 2,177 | 14% | | Automobile | 3,407 | 4,044 | 6,383 | (637) | (16%) | (2,976) | (47%) | | Education | 8,550 | 8,779 | 11,265 | (229) | (3%) | (2,715) | (24%) | | Total retail | 67,662 | 67,127 | 69,908 | 535 | 1% | (2,246) | (3%) | | Total loans and leases | $139,304 | $137,635 | $141,842 | $1,669 | 1% | ($2,538) | (2%) | [Deposits Breakdown](index=7&type=section&id=Deposits%20Breakdown) Total deposits decreased QoQ and YoY, with noninterest-bearing demand deposits increasing while interest-bearing deposits declined | Deposit Category | June 30, 2025 ($ Millions) | Mar 31, 2025 ($ Millions) | June 30, 2024 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :----------------------- | :------------------------- | :------------------------- | :------------------------- | :------------- | :------------- | :------------- | :------------- | | Noninterest-bearing demand | $38,001 | $37,556 | $36,927 | $445 | 1% | $1,074 | 3% | | Checking with interest | 34,918 | 34,456 | 34,421 | 462 | 1% | 497 | 1% | | Savings | 25,400 | 25,765 | 27,240 | (365) | (1%) | (1,840) | (7%) | | Money market | 55,638 | 55,996 | 52,599 | (358) | (1%) | 3,039 | 6% | | Time | 21,129 | 23,803 | 25,165 | (2,674) | (11%) | (4,036) | (16%) | | Total deposits | $175,086 | $177,576 | $176,352 | ($2,490) | (1%) | ($1,266) | (1%) | [Average Balance Sheets, Annualized Yields and Rates](index=8&type=section&id=Average%20Balance%20Sheets%2C%20Annualized%20Yields%20and%20Rates) This section analyzes average balance sheet components, annualized yields, and rates for interest-earning assets and liabilities [Interest-Earning Assets](index=8&type=section&id=Interest-Earning%20Assets) Average interest-earning assets increased QoQ but decreased YoY, with yields slightly up QoQ but down YoY | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total interest-earning assets | $196,318 | $195,058 | $198,465 | $1,260 | 1% | ($2,147) | (1%) | | Total loans and leases | 138,809 | 139,710 | 143,067 | (901) | (1%) | (4,258) | (3%) | | Yield on total interest-earning assets | 4.89% | 4.84% | 5.17% | 5 bps | | (28) bps | | | Yield on total loans and leases | 5.31% | 5.26% | 5.60% | 5 bps | | (29) bps | | - For the six months ended June 30, 2025, average total interest-earning assets decreased by **2%** and the yield decreased by **32 bps** compared to 2024[11](index=11&type=chunk) [Interest-Bearing Liabilities](index=8&type=section&id=Interest-Bearing%20Liabilities) Average interest-bearing liabilities increased QoQ but decreased YoY, with rates paid slightly down QoQ and significantly down YoY | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total interest-bearing liabilities | $150,202 | $149,494 | $152,882 | $708 | — | ($2,680) | (2%) | | Total interest-bearing deposits | 136,778 | 136,162 | 137,465 | 616 | — | (687) | — | | Rate on total interest-bearing liabilities | 2.59% | 2.60% | 3.06% | (1) bps | | (47) bps | | | Rate on total interest-bearing deposits | 2.35% | 2.37% | 2.82% | (2) bps | | (47) bps | | - For the six months ended June 30, 2025, average total interest-bearing liabilities decreased by **2%** and the rate decreased by **47 bps** compared to 2024[11](index=11&type=chunk) [Net Interest Margin](index=8&type=section&id=Net%20Interest%20Margin) Net interest margin (FTE) improved QoQ and YoY, reaching 2.95% in 2Q25, reflecting enhanced profitability | Metric | 2Q25 | 1Q25 | 2Q24 | QoQ Change (bps) | YoY Change (bps) | | :-------------------------- | :----- | :----- | :----- | :--------------- | :--------------- | | Net interest margin (FTE) | 2.95% | 2.90% | 2.87% | 5 | 8 | | Net interest income (FTE) | $1,441 | $1,395 | $1,415 | $46 | $26 | - For the six months ended June 30, 2025, net interest margin (FTE) increased by **3 bps** to **2.92%** compared to 2024, despite a slight decrease in net interest income (FTE)[11](index=11&type=chunk) [Mortgage Banking Fees](index=10&type=section&id=Mortgage%20Banking%20Fees) This section analyzes the company's mortgage banking fees, including production revenue and MSR valuation changes [Mortgage Banking Fees Summary](index=10&type=section&id=Mortgage%20Banking%20Fees%20Summary) Total mortgage banking fees significantly increased QoQ and YoY, driven by MSR valuation changes and production revenue growth | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total mortgage banking fees | $73 | $59 | $54 | $14 | 24% | $19 | 35% | | Production revenue | 19 | 15 | 14 | 4 | 27% | 5 | 36% | | Mortgage servicing revenue | 28 | 32 | 35 | (4) | (13%) | (7) | (20%) | | MSR valuation changes, net of hedge impact | 26 | 12 | 5 | 14 | 117% | 21 | NM | - For the six months ended June 30, 2025, total mortgage banking fees increased by **28%** to **$132 million** compared to 2024, largely due to MSR valuation changes[12](index=12&type=chunk) [Residential Real Estate Originations](index=10&type=section&id=Residential%20Real%20Estate%20Originations) Total residential real estate originations surged QoQ and YoY, with strong growth across retail, third-party, and investment channels | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total originations | $4,105 | $2,918 | $2,907 | $1,187 | 41% | $1,198 | 41% | | Retail originations | 2,189 | 1,444 | 1,584 | 745 | 52% | 605 | 38% | | Third Party originations | 1,916 | 1,474 | 1,323 | 442 | 30% | 593 | 45% | | Originated for sale | 2,486 | 1,916 | 1,872 | 570 | 30% | 614 | 33% | | Originated for investment | 1,619 | 1,002 | 1,035 | 617 | 62% | 584 | 56% | - For the six months ended June 30, 2025, total residential real estate originations increased by **45%** to **$7,023 million** compared to 2024[12](index=12&type=chunk) [Segment Financial Highlights](index=11&type=section&id=Segment%20Financial%20Highlights) This section provides financial highlights for the company's key operating segments: Consumer Banking, Commercial Banking, Non-Core, and Other [Consumer Banking](index=11&type=section&id=CONSUMER%20BANKING) Consumer Banking reported strong growth in total revenue and net income, driven by increased net interest and noninterest income | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total revenue | $1,547 | $1,490 | $1,397 | $57 | 4% | $150 | 11% | | Net income | 376 | 336 | 296 | 40 | 12% | 80 | 27% | | Net interest income | 1,218 | 1,193 | 1,120 | 25 | 2% | 98 | 9% | | Noninterest income | 329 | 297 | 277 | 32 | 11% | 52 | 19% | | Efficiency ratio | 62.24 | 64.06 | 65.49 | (182) bps | | (325) bps | | | Average total loans and leases | 72,402 | 71,054 | 67,960 | 1,348 | 2% | 4,442 | 7% | | Average deposits | 127,271 | 125,728 | 120,478 | 1,543 | 1% | 6,793 | 6% | - For the six months ended June 30, 2025, Consumer Banking's total revenue increased by **11%** to **$3,037 million** and net income increased by **25%** to **$712 million** compared to 2024[13](index=13&type=chunk) [Commercial Banking](index=12&type=section&id=COMMERCIAL%20BANKING) Commercial Banking saw YoY revenue and net income decreases due to lower net interest income, but net income improved QoQ | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total revenue | $671 | $656 | $736 | $15 | 2% | ($65) | (9%) | | Net income | 206 | 196 | 259 | 10 | 5% | (53) | (20%) | | Net interest income | 439 | 441 | 494 | (2) | — | (55) | (11%) | | Noninterest income | 232 | 215 | 242 | 17 | 8% | (10) | (4%) | | Efficiency ratio | 47.47 | 49.77 | 42.28 | (230) bps | | 519 bps | | | Average total loans and leases | 63,057 | 62,437 | 65,997 | 620 | 1% | (2,940) | (4%) | | Average deposits | 42,481 | 42,178 | 44,203 | 303 | 1% | (1,722) | (4%) | - For the six months ended June 30, 2025, Commercial Banking's total revenue decreased by **10%** to **$1,327 million** and net income decreased by **22%** to **$402 million** compared to 2024[15](index=15&type=chunk) [Non-Core](index=13&type=section&id=NON-CORE) The Non-Core segment significantly improved net income (loss) QoQ and YoY, reducing its net loss, with improved net interest income | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total revenue | ($2) | ($15) | ($31) | $13 | 87% | $29 | 94% | | Net income (loss) | ($14) | ($51) | ($50) | $37 | 73% | $36 | 72% | | Net interest income | ($5) | ($15) | ($31) | $10 | 67% | $26 | 84% | | Average total assets | $5,216 | $6,536 | $9,418 | ($1,320) | (20%) | ($4,202) | (45%) | | Net interest margin | (0.43)% | (0.90)% | (1.36)% | 47 bps | | 93 bps | | - For the six months ended June 30, 2025, the Non-Core segment's net income (loss) improved by **41%** to **($65) million** compared to **($110) million** in 2024[16](index=16&type=chunk) [Other](index=14&type=section&id=OTHER) The 'Other' segment reported a larger net loss QoQ and YoY, primarily due to increased negative net interest income, despite decreased noninterest expense | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total revenue | ($179) | ($196) | ($139) | $17 | 9% | ($40) | (29%) | | Net income (loss) | ($132) | ($108) | ($113) | ($24) | (22%) | ($19) | (17%) | | Net interest income | ($215) | ($228) | ($173) | $13 | 6% | ($42) | (24%) | | Noninterest expense | 24 | 17 | 49 | 7 | 41% | (25) | (51%) | | Provision for credit losses | (3) | (47) | (2) | 44 | 94% | (1) | (50%) | - For the six months ended June 30, 2025, the 'Other' segment's net income (loss) improved by **4%** to **($240) million** compared to **($250) million** in 2024, despite a significant increase in negative net interest income[17](index=17&type=chunk) [Credit-Related Information](index=15&type=section&id=Credit-Related%20Information) This section provides an overview of the company's credit quality, including nonaccrual loans, past due loans, and charge-offs [Nonaccrual Loans and Leases](index=15&type=section&id=Nonaccrual%20Loans%20and%20Leases) Total nonaccrual loans and leases decreased QoQ but remained stable YoY, with commercial declines offset by residential mortgage increases | Metric | June 30, 2025 ($ Millions) | Mar 31, 2025 ($ Millions) | June 30, 2024 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :------------------------- | :------------------------- | :------------------------- | :------------- | :------------- | :------------- | :------------- | | Total nonaccrual loans and leases | $1,524 | $1,582 | $1,527 | ($58) | (4%) | ($3) | — | | Commercial and industrial | 233 | 283 | 261 | (50) | (18%) | (28) | (11%) | | Commercial real estate | 706 | 700 | 678 | 6 | 1% | 28 | 4% | | Residential mortgages | 198 | 198 | 153 | — | — | 45 | 29% | | Nonaccrual loans and leases to loans and leases | 1.09% | 1.15% | 1.08% | (6) bps | | 1 bps | | [Loans and Leases 90 Days or More Past Due and Accruing](index=16&type=section&id=Loans%20and%20Leases%2090%20Days%20or%20More%20Past%20Due%20and%20Accruing) Loans and leases 90+ days past due increased QoQ but decreased YoY, driven by a significant QoQ rise in commercial real estate | Metric | June 30, 2025 ($ Millions) | Mar 31, 2025 ($ Millions) | June 30, 2024 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :------------------------- | :------------------------- | :------------------------- | :------------- | :------------- | :------------- | :------------- | | Total loans and leases | $194 | $155 | $228 | $39 | 25% | ($34) | (15%) | | Commercial real estate | 60 | 4 | 36 | 56 | NM | 24 | 67% | | Residential mortgages | 128 | 138 | 182 | (10) | (7%) | (54) | (30%) | [Charge-offs, Recoveries, and Related Ratios](index=17&type=section&id=Charge-offs%2C%20Recoveries%2C%20and%20Related%20Ratios) Total net charge-offs decreased QoQ but slightly increased YoY, with commercial charge-offs up and retail charge-offs down QoQ | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Total gross charge-offs | $201 | $234 | $223 | ($33) | (14%) | ($22) | (10%) | | Total gross recoveries | 34 | 34 | 39 | — | — | (5) | (13%) | | Total net charge-offs | 167 | 200 | 184 | (33) | (17%) | (17) | (9%) | | Commercial net charge-offs | 92 | 81 | 96 | 11 | 14% | (4) | (4%) | | Retail net charge-offs | 75 | 119 | 88 | (44) | (37%) | (13) | (15%) | | Annualized net charge-off rate (Total loans and leases) | 0.48% | 0.58% | 0.52% | (10) bps | | (4) bps | | - For the six months ended June 30, 2025, total net charge-offs increased by **1%** to **$367 million** compared to 2024[21](index=21&type=chunk) [Summary of Changes in the Components of the Allowance for Credit Losses](index=19&type=section&id=Summary%20of%20Changes%20in%20the%20Components%20of%20the%20Allowance%20for%20Credit%20Losses) Total allowance for credit losses decreased slightly QoQ and YoY, with net charge-offs down QoQ and provision for losses down YoY | Metric | 2Q25 ($ Millions) | 1Q25 ($ Millions) | 2Q24 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :---------------- | :---------------- | :---------------- | :------------- | :------------- | :------------- | :------------- | | Allowance for loan and lease losses - ending | $2,008 | $2,014 | $2,125 | ($6) | — | ($117) | (6%) | | Total allowance for credit losses - ending | 2,209 | 2,212 | 2,306 | (3) | — | (97) | (4%) | | Net charge-offs | 167 | 200 | 184 | (33) | (17%) | (17) | (9%) | | Total provision for loan and lease losses | 161 | 153 | 223 | 8 | 5% | (62) | (28%) | | Commercial allowance for credit losses | 1,269 | 1,312 | 1,429 | (43) | (3%) | (160) | (11%) | | Retail allowance for credit losses | 940 | 900 | 877 | 40 | 4% | 63 | 7% | - For the six months ended June 30, 2025, the total allowance for credit losses decreased by **4%** to **$2,209 million** compared to 2024[23](index=23&type=chunk) [Capital and Ratios](index=20&type=section&id=Capital%20and%20Ratios) This section reviews the company's capital structure, including capital ratios and tangible common equity [Capital Ratios and Components (Preliminary)](index=20&type=section&id=Capital%20Ratios%20and%20Components%20%28Preliminary%29) Capital ratios remained strong and stable in 2Q25, with CET1 and Tier 1 capital slightly up QoQ but down YoY | Metric | June 30, 2025 ($ Millions) | Mar 31, 2025 ($ Millions) | June 30, 2024 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :------------------------- | :------------------------- | :------------------------- | :------------- | :------------- | :------------- | :------------- | | CET1 capital | $17,812 | $17,751 | $18,086 | $61 | — | ($274) | (2%) | | Tier 1 capital | 19,925 | 19,864 | 20,198 | 61 | — | (273) | (1%) | | Total capital | 23,221 | 23,156 | 23,551 | 65 | — | (330) | (1%) | | Risk-weighted assets | 168,017 | 166,908 | 168,393 | 1,109 | 1% | (376) | — | | CET1 capital ratio | 10.6% | 10.6% | 10.7% | | | | | | Tier 1 leverage ratio | 9.4% | 9.4% | 9.4% | | | | | [Tangible Common Equity (Period-End and Average)](index=20&type=section&id=Tangible%20Common%20Equity%20%28Period-End%20and%20Average%29) Tangible common equity (TCE) increased healthily QoQ and YoY, driven by common stockholders' equity growth and reduced intangible assets | Metric | June 30, 2025 ($ Millions) | Mar 31, 2025 ($ Millions) | June 30, 2024 ($ Millions) | QoQ Change ($) | QoQ Change (%) | YoY Change ($) | YoY Change (%) | | :-------------------------- | :------------------------- | :------------------------- | :------------------------- | :------------- | :------------- | :------------- | :------------- | | Total tangible common equity (period-end) | $15,246 | $14,867 | $13,866 | $379 | 3% | $1,380 | 10% | | Total tangible common equity (average) | 14,611 | 14,297 | 13,527 | 314 | 2% | 1,084 | 8% | | Common stockholders' equity (period-end) | 23,121 | 22,753 | 21,757 | 368 | 2% | 1,364 | 6% | | Other intangible assets (period-end) | 128 | 137 | 139 | (9) | (7%) | (11) | (8%) | [Non-GAAP Financial Measures and Reconciliations](index=21&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) This section defines and reconciles non-GAAP financial measures, providing insights into underlying operational performance [Non-GAAP Financial Measures Overview](index=21&type=section&id=Non-GAAP%20Financial%20Measures%20Overview) This section defines 'Underlying' non-GAAP measures, which exclude non-recurring items, used by management and investors to assess ongoing performance - Non-GAAP measures, labeled **'Underlying,'** exclude specific items that management deems not indicative of the company's ongoing financial performance[25](index=25&type=chunk) - These measures are used by management for evaluating operating performance and making day-to-day operating decisions, and are considered useful for investors in conjunction with GAAP results[25](index=25&type=chunk) - Investors are cautioned not to rely solely on non-GAAP measures, but to consider them with the most directly comparable GAAP measures, as they have limitations as analytical tools[26](index=26&type=chunk) [Key Non-GAAP Reconciliations](index=22&type=section&id=Key%20Non-GAAP%20Reconciliations) This section provides detailed reconciliations for 'Underlying' non-GAAP measures, adjusting GAAP figures by removing 'notable items' for core performance insights | Metric | 2Q25 (GAAP) | 2Q25 (Underlying) | 2Q24 (GAAP) | 2Q24 (Underlying) | YoY Change (Underlying) ($) | YoY Change (Underlying) (%) | | :--------------------------------- | :---------- | :---------------- | :---------- | :---------------- | :-------------------------- | :-------------------------- | | Total revenue | $2,037 | $2,037 | $1,963 | $1,959 | $78 | 4% | | Noninterest expense | 1,319 | 1,319 | 1,301 | 1,265 | $54 | 4% | | Net income | 436 | 436 | 392 | 408 | $28 | 7% | | Diluted earnings per share | 0.92 | 0.92 | 0.78 | 0.82 | $0.10 | 12% | | Efficiency ratio | 64.76% | 64.76% | 66.27% | 64.59% | 17 bps | | | Return on average common equity | 7.18% | 7.18% | 6.70% | 7.00% | 18 bps | | | Return on average tangible common equity | 11.05% | 11.05% | 10.61% | 11.09% | (4) bps | | - Notable items, which are excluded from **'Underlying'** measures, impacted noninterest income, noninterest expense, and income tax expense in prior periods, but had no impact in **2Q25**[27](index=27&type=chunk)

Core Viewpoint - Citizens Financial Group, Inc. (CFG) is expected to report an increase in second-quarter 2025 earnings and revenues compared to the same quarter last year, with various factors influencing this performance [1][18]. Financial Performance Expectations - CFG's net interest income (NII) is projected to rise by 3% in Q2 2025 from the previous quarter, supported by stable interest rates maintained by the Federal Reserve [3][11]. - The Zacks Consensus Estimate for NII is $1.44 billion, reflecting a 3.2% increase from the prior quarter [4]. - The consensus estimate for second-quarter revenues is $2.01 billion, indicating a 2.2% rise from the year-ago figure [18]. Loan and Asset Quality Insights - Despite macroeconomic uncertainties, demand for commercial and industrial loans and consumer loans is expected to have improved, leading to a modest rise in CFG's lending activities [5]. - The Zacks Consensus Estimate for average interest-earning assets is $196.2 billion, showing a slight increase from the previous quarter [6]. - Non-accrual loans are estimated to rise to $1.62 billion, a 2.4% increase sequentially, indicating potential concerns regarding asset quality [15]. Non-Interest Income and Fee Growth - Mortgage banking fees are expected to increase to $63 million, a 6.6% rise from the prior quarter, driven by improved refinancing activities [8]. - Trust and investment services fees are projected to reach $84 million, reflecting a 3.7% increase from the previous quarter [9]. - Capital markets fees are estimated at $108.4 million, indicating an 8.4% sequential rise, supported by improved deal-making activities in the latter part of the quarter [12][10]. Expense Management - CFG anticipates that adjusted non-interest expenses will remain stable compared to the first quarter, despite increased costs from new banking offices and technology investments [14].

Analysts on Wall Street project that Citizens Financial Group (CFG) will announce quarterly earnings of $0.88 per share in its forthcoming report, representing an increase of 12.8% year over year. Revenues are projected to reach $2.01 billion, increasing 2.2% from the same quarter last year. Over the last 30 days, there has been an upward revision of 0.1% in the consensus EPS estimate for the quarter, leading to its current level. This signifies the covering analysts' collective reconsideration of their ini ...

Core Viewpoint - Citizens Financial Group (CFG) is well-positioned to continue its earnings-beat streak in the upcoming report, supported by a positive earnings surprise history and favorable analyst estimates [1][5]. Earnings Performance - For the last reported quarter, Citizens Financial Group achieved earnings of $0.77 per share, exceeding the Zacks Consensus Estimate of $0.75 per share, resulting in a surprise of 2.67% [2]. - In the previous quarter, the company reported earnings of $0.85 per share against an expected $0.83 per share, delivering a surprise of 2.41% [2]. Earnings Estimates - Recent estimates for Citizens Financial Group have been trending upward, with a positive Earnings ESP (Expected Surprise Prediction) indicating a strong likelihood of an earnings beat [5][8]. - The current Earnings ESP for the company stands at +1.55%, reflecting increased analyst optimism regarding its near-term earnings potential [8]. Zacks Rank and Predictive Power - The stock holds a Zacks Rank of 3 (Hold), which, when combined with a positive Earnings ESP, suggests a high probability of beating consensus estimates, with historical data indicating nearly 70% success in such cases [6][8]. - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, with the Most Accurate Estimate being more reflective of recent analyst revisions [7].