Financial Data and Key Metrics Changes - The company reported a net interest margin (NIM) expansion of three basis points to 2.90% [6][21] - Earnings per share (EPS) for Q1 was 77 cents, with a return on tangible common equity (ROTC) of 9.6% [15] - The balance sheet remains strong with a CET1 ratio of 10.6% and a loan-to-deposit ratio (LDR) of 77.5% [6][19] Business Line Data and Key Metrics Changes - The private bank saw significant growth, reaching $8.7 billion in deposits and $5.2 billion in assets under management (AUM) [8][40] - Core retail loans grew slightly, driven by home equity and mortgage products, with HELOC up 9% year-over-year [62][64] - Non-interest income decreased by 3.5% linked quarter, impacted by seasonal effects in capital markets [23] Market Data and Key Metrics Changes - The company experienced a favorable credit trend with net charge-offs at 58 basis points, down from 53 basis points in the prior quarter [32][34] - Non-accrual loans decreased by 5% linked quarter, indicating improved credit quality [33] - Period-end deposits increased by approximately $3 billion, or 2%, primarily in low-cost categories [29] Company Strategy and Development Direction - The company aims to build a premier bank-owned private bank and private wealth franchise, with a focus on strategic initiatives in the private banking sector [39] - The strategy includes a transformed consumer bank and a well-positioned commercial bank among regional peers [39] - The company is optimistic about a pickup in loan demand and deal activity in the second half of the year, contingent on macroeconomic stability [10][12] Management's Comments on Operating Environment and Future Outlook - Management noted increased uncertainty in the macro environment due to policy decisions, but corporate and consumer borrowers are generally in good shape [9][10] - The company reaffirmed its EPS estimate for the full year, despite potential risks from economic uncertainty [10][44] - There is a significant amount of pent-up demand for M&A activity, with a record number of transactions in the pipeline [12][80] Other Important Information - The company executed $200 million in stock buybacks during the quarter, taking advantage of its strong capital position [36] - An agreement was made to sell approximately $1.9 billion in non-core education loans, which is expected to be accretive to NIM, EPS, and ROTC [17][38] - The company maintains a robust liquidity position with a pro forma liquidity coverage ratio (LCR) of 122% [31] Q&A Session Summary Question: Can you provide more color around loan demand and trends in line utilization? - Management indicated an increase in line utilization, driven by factors including tariffs and M&A activity, with expectations for continued growth in the second half of the year [54][56] Question: How does the company view capital management in light of potential weaker loan growth? - The company remains committed to its capital range and is open to increasing buybacks if risk-weighted assets decrease, while also monitoring economic conditions [70][73] Question: Can you discuss the capital markets outlook and fee guidance? - Management expressed confidence in their capital markets capabilities and noted a record pipeline of transactions, although timing may be affected by market conditions [80][86] Question: What is the ideal interest rate environment for the company? - The company is slightly asset sensitive and can perform well in a range of interest rate scenarios, with a focus on non-rate-related tailwinds driving NIM [93][99] Question: What unemployment rate is the reserve based on? - The baseline scenario assumes an unemployment rate of 5.1%, with higher rates applied to specific portfolios like commercial real estate [116][118]

Financial Performance - Total revenue for Q1 2025 was $1,935 million, a decrease of 3% from Q4 2024 and a slight increase of 1% from Q1 2024[4] - Net income for Q1 2025 was $373 million, down 7% from Q4 2024 but up 12% compared to Q1 2024[4] - Basic earnings per share for Q1 2025 were $0.78, a decrease of 6% from Q4 2024 and an increase of 18% from Q1 2024[4] - Total interest income for Q1 2025 was $2,352 million, a decrease of 4% from Q4 2024 and 10% from Q1 2024[7] - Net interest income for Q1 2025 was $1,391 million, down 1% from Q4 2024 and 4% from Q1 2024[7] - Total noninterest income decreased to $544 million in Q1 2025, a decline of 5% from Q4 2024, but an increase of 5% from Q1 2024[7] - Total revenue for consumer banking was $1.490 billion, a slight decrease of 1% from $1.507 billion in Q4 2024, but a 10% increase from $1.351 billion in Q1 2024[12] - Net income for consumer banking was $336 million, down 6% from $358 million in Q4 2024, but up 24% from $272 million in Q1 2024[12] - Total revenue in commercial banking was $656 million, a 6% decrease from $696 million in Q4 2024, and an 11% decrease from $741 million in Q1 2024[14] Asset and Liability Management - Total assets as of March 31, 2025, were $220,148 million, reflecting a 1% increase from December 31, 2024[8] - Total deposits rose to $177,576 million, a 2% increase from December 31, 2024[8] - Total loans and leases decreased by $1,568 million (1%) from December 31, 2024, to $137,635 million as of March 31, 2025[9] - Total deposits increased by $2,800 million (2%) from December 31, 2024, to $177,576 million as of March 31, 2025[9] - Average interest-earning assets decreased by $1,555 million (0.79%) from the previous quarter to $195,058 million in Q1 2025[10] - Total interest-bearing liabilities decreased by $994 million (0.66%) from the previous quarter to $149,494 million in Q1 2025[10] - Total assets in the non-core segment decreased by 12% to $6.536 billion from $7.428 billion in Q4 2024, and decreased by 38% from $10.554 billion in Q1 2024[16] Capital and Equity - The CET1 capital ratio at the end of Q1 2025 was 10.6%, down from 10.8% in Q4 2024[5] - Total stockholders' equity increased to $24,866 million, a 3% rise from December 31, 2024[8] - Total tangible common equity reached $14,867 million, marking a 4% increase from December 31, 2024[8] - Common stockholders' equity increased to $22.753 billion in Q1 2025, reflecting a 3% increase from $22.141 billion in Q4 2024[24] - Total capital decreased to $23.156 billion in Q1 2025, a decline of 0.3% from $23.232 billion in Q4 2024[24] - Total allowance for credit losses decreased to $2.212 billion at the end of Q1 2025, down 2% from $2.259 billion in Q4 2024[23] Efficiency and Ratios - The efficiency ratio for Q1 2025 was 67.91%, an increase from 66.27% in Q4 2024[5] - Return on average common equity for Q1 2025 was 6.21%, a decrease of 43 basis points from Q4 2024[28] - Noninterest income as a percentage of total revenue (non-GAAP) for Q1 2025 was 28.14%, a decrease of 76 basis points from Q4 2024[28] - Dividend payout ratio increased to 54% in Q1 25 from 51% in Q4 2024, reflecting a 325 basis points increase[30] Credit Quality - The provision for credit losses in Q1 2025 was $153 million, a decrease of 6% from Q4 2024[4] - Total nonaccrual loans and leases decreased to $1,582 million, down 5% from Q4 2024[18] - Allowance for loan and lease losses to loans and leases was 1.46% as of March 31, 2025, a decrease of 2 basis points from December 31, 2024[19] - Gross charge-offs for commercial and industrial loans increased to $34 million in Q1 2025, a 143% increase compared to Q4 2024[21] - Total loans and leases 90 days or more past due and accruing decreased to $155 million, a 21% decline from Q4 2024[19] Noninterest Expenses - Noninterest expense (GAAP) for Q1 2025 was $1,314 million, a slight decrease of $2 million (0%) from Q4 2024[27] - Salaries and employee benefits (GAAP) increased by 3% to $696 million in Q1 25 compared to $674 million in Q4 2024[30]

Core Viewpoint - Analysts forecast that Citizens Financial Group (CFG) will report quarterly earnings of $0.75 per share, reflecting a year-over-year increase of 15.4%, while revenues are expected to decline by 0.9% to $1.94 billion [1]. Earnings Projections - The consensus EPS estimate has been revised downward by 2.4% in the past 30 days, indicating a reassessment by covering analysts [2]. - Changes in earnings projections are crucial for predicting investor reactions, as empirical studies show a strong correlation between earnings estimate trends and short-term stock price movements [3]. Key Metrics Estimates - The consensus estimate for the Efficiency Ratio is 68.1%, down from 69.3% a year ago [5]. - Analysts estimate the Book Value per Common Share at $50.90, compared to $47.43 last year [5]. - Average Balances of Total Interest-Earning Assets are projected to be $195.79 billion, down from $200.07 billion year-over-year [5]. Financial Ratios - The Return on Average Common Equity is expected to reach 6.0%, up from 5.6% in the same quarter last year [6]. - Net Charge-Offs are forecasted at $176.35 million, slightly down from $181 million a year ago [6]. - Tangible Book Value per Common Share is estimated at $32.68, compared to $30.19 last year [6]. Capital Ratios - The Tier 1 Leverage Ratio is projected to be 9.4%, up from 9.3% in the same quarter last year [7]. - Nonaccrual Loans and Leases are expected to reach $1.62 billion, compared to $1.47 billion a year ago [7]. - The Tier 1 Capital Ratio is anticipated to be 12.0%, slightly up from 11.8% last year [8]. - The Total Capital Ratio is expected to be 13.9%, compared to 13.8% a year ago [8]. - The Common Equity Tier 1 Capital Ratio (CET1 Capital Ratio) is projected at 10.7%, up from 10.6% last year [8]. Recent Performance - Citizens Financial Group shares have decreased by 12.4% in the past month, while the S&P 500 composite has declined by 6.1% [9][10]. - CFG holds a Zacks Rank of 3 (Hold), indicating it is expected to closely follow overall market performance in the near term [10].

Company Overview - Citizens Financial Group (CFG) shares increased by 8.9% to $37.47 in the last trading session, following a period of 13.8% loss over the past four weeks, indicating a significant recovery in stock performance [1] - The stock price surge was influenced by President Trump's announcement on April 9, 2025, regarding a 90-day pause on reciprocal tariffs for most trading partners, which alleviated trade war concerns and improved the economic outlook, thereby boosting investor confidence in banking stocks like CFG [2] Earnings Expectations - Citizens Financial Group is projected to report quarterly earnings of $0.75 per share, reflecting a year-over-year increase of 15.4%, while revenues are expected to be $1.94 billion, a slight decline of 0.8% from the previous year [3] - The consensus EPS estimate for CFG has been revised down by 2.4% over the last 30 days, indicating a negative trend in earnings estimate revisions, which typically does not correlate with price appreciation [4] Industry Context - CFG is part of the Zacks Banks - Northeast industry, where NBT Bancorp (NBTB) also operates, having closed the last trading session at $40.45 with a 4.7% increase, although NBTB has seen a -9.6% return over the past month [4] - NBT's consensus EPS estimate remains unchanged at $0.76, representing an 11.8% increase compared to the previous year's EPS, and it also holds a Zacks Rank of 3 (Hold) [5]

Core Viewpoint - The market anticipates Citizens Financial Group (CFG) to report a year-over-year increase in earnings despite lower revenues for the quarter ended March 2025, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - The consensus EPS estimate for CFG is $0.75 per share, reflecting a year-over-year increase of +15.4%, while revenues are projected to be $1.94 billion, a decrease of 0.8% from the previous year [3]. Estimate Revisions - Over the last 30 days, the consensus EPS estimate has been revised down by 2.35%, indicating a bearish sentiment among analysts regarding CFG's earnings prospects [4][10]. Earnings Surprise Prediction - The Most Accurate Estimate for CFG is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -0.27%, which complicates the prediction of an earnings beat [10][11]. Historical Performance - In the last reported quarter, CFG exceeded the consensus EPS estimate of $0.83 by posting earnings of $0.85, achieving a surprise of +2.41%. However, the company has only beaten consensus EPS estimates once in the last four quarters [12][13]. Conclusion - CFG does not appear to be a strong candidate for an earnings beat, and investors should consider additional factors when making decisions regarding the stock ahead of the earnings release [16].

Financial Performance - Net income decreased by $99 million, with earnings per diluted common share down $0.10 to $3.03 compared to 2023[212]. - Total revenue decreased by $415 million to $7.8 billion compared to 2023, driven by a 10% decrease in net interest income[215]. - On an Underlying basis, net income available to common stockholders was $1.5 billion compared to $1.8 billion in 2023[215]. - The efficiency ratio was stable at 67.0% compared to 2023, with an Underlying efficiency ratio of 65.2% compared to 60.8% in 2023[215]. - Return on Tangible Common Equity (ROTCE) was 9.8% compared to 10.9% in 2023, with an Underlying ROTCE of 10.5% compared to 13.5%[215]. - Tangible book value per common share increased by 5% from 2023 to $32.34[215]. Assets and Capital - Total assets as of December 31, 2024, were $217.5 billion, total deposits were $174.8 billion, and total stockholders' equity was $24.3 billion[16]. - As of December 31, 2024, both the Parent Company and CBNA were classified as "well-capitalized" with a CET1 ratio of at least 6.5%, a tier 1 capital ratio of at least 8%, a total capital ratio of at least 10%, and a tier 1 leverage ratio of at least 5%[75]. - The company is subject to capital adequacy and liquidity standards, and failure to meet these standards could limit capital distributions and lead to supervisory actions[171]. Business Segments - The Consumer Banking segment serves consumer customers and small businesses, offering products such as deposits, mortgage lending, credit cards, and wealth management services across 1,000 branches and 3,100 ATMs[19][20]. - The Commercial Banking segment provides a wide range of financial products including lending, treasury management, and capital markets services, focusing on middle-market and corporate clients[21][22]. Strategic Initiatives - Citizens Financial Group aims to enhance its customer-centric culture and improve operational efficiency through initiatives like the Tapping our Potential (TOP) program, with TOP 9 completed in 2024 and TOP 10 launched in 2025[31]. - The company is on a multi-year digital transformation journey to modernize technology and improve customer experiences, utilizing advanced data analytics and artificial intelligence[30][33]. - Citizens Financial Group focuses on developing differentiated value propositions to serve affluent customers and small businesses, aiming to deepen relationships and enhance customer experience[28]. Regulatory Environment - The company is subject to enhanced prudential standards and associated capital and liquidity rules as a BHC with over $100 billion in total consolidated assets[57]. - The liquidity coverage ratio (LCR) is not applicable to the company as it has less than $50 billion in weighted short-term wholesale funding[67]. - The FDIC requires large depository institutions, including CBNA, to maintain enhanced deposit account recordkeeping capabilities to facilitate prompt calculation of insured deposits if taken into receivership[77]. - Regulatory compliance is critical, as failure to meet supervisory expectations could lead to restrictions on business activities and significant penalties[164][165]. - The regulatory environment is subject to significant and evolving requirements that could adversely affect the company's business and earnings[168]. Risk Management - Citizens Financial Group is subject to heightened risk governance standards due to its asset size, requiring a robust risk governance framework overseen by an independent board[114]. - The company’s risk management framework may not be effective under all conditions, potentially leading to unexpected losses[137]. - The company faces operational risks from transaction processing, compliance failures, and potential cyber-attacks, which could adversely impact its business[144]. - The company faces significant cybersecurity risks, including threats from organized crime and nation-states, which could adversely affect operations and customer data security[147]. - Cyber-attack risks are increasing, with potential loss of funds and sensitive customer data being major concerns, despite the implementation of protective measures[147]. Competition and Market Conditions - Citizens Financial Group faces competition from various financial institutions, including community banks and FinTech companies, which are increasingly leveraging technology to attract customers[35][37]. - The financial services industry is highly competitive, with potential margin declines and loss of business due to aggressive competition from both traditional and non-traditional financial institutions[158]. - Inflationary pressures may negatively impact funding costs and consumer demand, affecting the company's financial position and results of operations[121]. Sustainability and Social Responsibility - In 2023, the company announced a $50 billion Sustainable Finance Target, including $5 billion in green financing, to be achieved by 2030[50]. - The company committed to achieving operational carbon neutrality by 2035[50]. - Citizens Financial Group received an "Outstanding" rating on its most recent Community Reinvestment Act evaluation, which is significant for regulatory considerations in mergers and acquisitions[105]. Shareholder Considerations - The company repurchased 4,530,928 shares at an average price of $44.06 during October 2024, with a remaining repurchase capacity of $700 million[203]. - The ability to repurchase shares or pay dividends is dependent on federal regulatory considerations and capital requirements[183]. - Anti-takeover provisions may hinder third-party acquisition attempts, potentially affecting stockholder value[184].

Financial Data and Key Metrics Changes - The company reported underlying EPS of $3.24 for 2024, with a full-year ROTCE of 10.5%, which was 12% excluding non-core items [19][20] - Net interest income (NII) decreased by 9.7% year-over-year, with a full-year margin of 2.85% [20] - The company achieved a net interest margin (NIM) of 2.87% in Q4, reflecting a 10 basis point increase linked quarter [27] Business Line Data and Key Metrics Changes - The private bank reported $7 billion in deposits and $3.1 billion in loans, becoming profitable in Q4 [13][24] - Fees increased by 9% for the full year, driven by capital markets, card, and wealth fees [20] - Average loans were down slightly, with period-end loans down 1.7% linked quarter, reflecting a decline in commercial loans [31] Market Data and Key Metrics Changes - The company experienced subdued loan demand but compensated with a 10 basis point NIM expansion, leading to a 3% sequential growth in NII [7] - Period-end deposits remained stable, with growth in retail and the private bank offset by the paydown of higher-cost treasury and commercial deposits [32] - Non-interest-bearing deposits increased by about $940 million linked quarter, driven by the private bank and seasonal flows in commercial [33] Company Strategy and Development Direction - The company aims to transform into a premier bank-owned private bank and private wealth franchise, with a focus on a transformed consumer bank and a well-positioned commercial bank [17][40] - The company plans to step up investments in operating and capital expenditures to support key growth initiatives, anticipating positive operating leverage of around 1.5% for the full year [15][45] - The company is targeting a medium-term ROTCE of 16% to 18% by 2027, with expectations for NIM to reach around 3% [49][50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in credit trends improving and projected credit costs to decrease in 2025 [9][46] - The company expects solid growth in NII and fees in 2025, driven by capital markets and wealth management [14][44] - Management noted that the deposit franchise is performing well in a competitive environment, with a focus on maintaining low-cost deposits [22][80] Other Important Information - The company repurchased $225 million in shares during the quarter, totaling $1.05 billion for the year, representing about 6% of the beginning of year outstanding shares [10][39] - The allowance for credit losses (ACL) to loan ratio increased slightly to 1.62%, reflecting a stable macroeconomic outlook and improving loan mix [26][37] Q&A Session Summary Question: Can you provide context on the medium-term margin outlook? - Management indicated that the confidence to raise the upper end of the margin range is due to the outlook on rates and performance in Q4, with expectations for NIM to potentially reach 3.50% [57][61] Question: What is the outlook for costs and investments in the private bank? - Management acknowledged higher costs due to investments in the private bank and commercial banking, but expressed confidence in maintaining firm costs moving forward [62][66] Question: How does the company view deposit growth and mix? - Management highlighted strong performance in low-cost deposits and expected continued growth in both quantity and quality, particularly in the private bank [73][80] Question: What is the company's perspective on regulatory changes with the new administration? - Management expressed hope for a more favorable regulatory environment that allows banks to operate with flexibility and supports economic growth [112][118] Question: What is the current status of the commercial real estate portfolio? - Management indicated that they are in the middle innings of working through the commercial real estate challenges, with no new inflows into the workout team and a reduction in criticized assets [122][131]

Financial Performance - Citizens Financial Group (CFG) reported revenue of $1.99 billion for the quarter ended December 2024, a decrease of 0.1% year-over-year, but a surprise of +1.29% over the Zacks Consensus Estimate of $1.96 billion [1] - Earnings per share (EPS) for the quarter was $0.85, significantly higher than $0.34 in the same quarter last year, with an EPS surprise of +2.41% compared to the consensus estimate of $0.83 [1] Key Metrics - Total interest-earning assets averaged $196.61 billion, slightly below the average estimate of $197.05 billion [4] - Net charge-offs were reported at $189 million, close to the average estimate of $190.95 million [4] - Net Interest Margin stood at 2.9%, exceeding the average estimate of 2.8% [4] - Return on average common equity was 6.6%, above the estimated 6.4% [4] - Book value per common share was $50.26, lower than the estimated $50.76 [4] - Return on average total assets was 0.7%, matching the estimated 0.7% [4] - Efficiency Ratio was reported at 66.3%, higher than the estimated 65.4% [4] - Net charge-offs as a percentage of average loans and leases were 0.5%, consistent with the average estimate [4] - Tangible book value per common share was $32.34, below the estimated $32.75 [4] - Common Equity Tier 1 Capital Ratio (CET1) was 10.8%, above the estimated 10.6% [4] - Tier 1 Leverage Ratio was 9.4%, significantly higher than the estimated 8.3% [4] - Tier 1 Capital Ratio was reported at 12.1%, above the estimated 11.9% [4] Stock Performance - Shares of Citizens Financial Group have returned +10.3% over the past month, outperforming the Zacks S&P 500 composite, which saw a -2.1% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Group 1 - Citizens Financial Group (CFG) reported quarterly earnings of $0.85 per share, exceeding the Zacks Consensus Estimate of $0.83 per share, and showing a significant increase from $0.34 per share a year ago, representing an earnings surprise of 2.41% [1] - The company posted revenues of $1.99 billion for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 1.29%, with year-ago revenues also at $1.99 billion [2] - Citizens Financial Group shares have increased approximately 7% since the beginning of the year, outperforming the S&P 500's gain of 1% [3] Group 2 - The earnings outlook for Citizens Financial Group is mixed, with the current consensus EPS estimate for the coming quarter at $0.79 on revenues of $1.97 billion, and $3.85 on revenues of $8.19 billion for the current fiscal year [7] - The Zacks Industry Rank for Financial - Savings and Loan is currently in the top 10% of over 250 Zacks industries, indicating a favorable outlook for the industry [8] - The estimate revisions trend for Citizens Financial Group is currently reflected in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market in the near future [6]

In addition to the above factors, we also caution that the actual amounts and timing of any future common stock dividends or share repurchases will be subject to various factors, including our capital position, financial performance, capital impacts of strategic initiatives, market conditions, and regulatory considerations, as well as any other factors that our Board of Directors deems relevant in making such a determination. Therefore, there can be no assurance that we will repurchase shares from or pay an ...