U.S. equities pulled back on Tuesday, October 7, 2025, as investors digested a mix of corporate news, ongoing political uncertainty, and a reappraisal of artificial intelligence (AI) sector valuations. After a robust seven-day winning streak that saw major indexes reach new all-time highs, the market experienced a broad retreat, with technology stocks leading the decline. Concerns over the protracted government shutdown and its potential impact on economic data further contributed to a cautious sentiment am ...

Fifth Third Bancorp is buying Comerica for $10.9 billion in an all-stock deal, tying up two big regional banks.The buyout will create the 9th largest U.S. bank with approximately $288 billion in assets, the companies said Monday.The combined company will have operations in the Southeast, Texas and California, and will greatly solidify Fifth Third’s position in the Midwest. It is anticipated that over half of Fifth Third’s branches will be located in the Southeast, Texas, Arizona and California by 2030.“This ...

The U.S. stock market opened Tuesday, October 7, 2025, with a mixed sentiment, as investors continued to digest a flurry of corporate news, the persistent U.S. government shutdown, and the evolving outlook for Federal Reserve policy. While the artificial intelligence (AI) boom continues to fuel optimism in the tech sector, major indexes showed varied early performances following a record-setting Monday.Market Indexes: A Mixed Start to TuesdayAs the market commenced trading today, the S&P 500 Index (.SPX.US) ...

Market Overview - The U.S. stock market is showing strong momentum, particularly in technology stocks, despite a government shutdown [1][2] - Major market indexes are near record highs, indicating resilience amid political uncertainty [1][2] Major Market Indexes - The S&P 500 Index (SPX) is up approximately 0.3%, continuing its all-time highs [2] - The Nasdaq Composite (IXIC) is performing even better, up around 0.4% to 0.7%, but has not yet surpassed its previous record [2] - The Dow Jones Industrial Average (DJI) is struggling, falling into the red after an earlier rise [2] - The small-cap Russell 2000 (RUT) has reached an all-time peak above 2,500, reflecting broad market strength [2] Key Corporate News - Advanced Micro Devices (AMD) shares surged by 32.6% following a major deal with OpenAI, which will use AMD's chips for its AI infrastructure [3] - Nvidia (NVDA) saw a decline of 1.5% despite announcing a $100 billion investment in OpenAI [3] - Comerica (CMA) shares jumped 10.9% in pre-market trading and 16.5% by midday after Fifth Third Bancorp (FITB) announced an acquisition deal valued at $10.9 billion [4] - Fifth Third Bancorp's shares dipped 4.7% pre-market but later gained 1% by midday [4] - Archer Aviation Inc. (ACHR) rose 10.1% amid rumors of a partnership with Tesla (TSLA) [5] - Critical Metals Corp (CRML) surged 94.5% after reports of U.S. government discussions to acquire a stake in the company [5] - Quantum Computing Inc (QUBT) fell 10.5% after agreeing to sell shares at a discount [5] Sector Performance - The pharmaceutical sector is highlighted by Pfizer (PFE), which gained 15% last week due to a drug-pricing deal with the U.S. government [6] - The S&P 500 Pharmaceuticals Index experienced its strongest weekly performance in 23 years [6] Upcoming Market Events - The ongoing government shutdown is affecting the release of key economic data, including the September jobs report [7] - Investors are awaiting the Federal Reserve's minutes from its last meeting, expected to provide insights into interest rate cuts [8] - Fed Chair Jerome Powell is scheduled to speak on October 9, which may offer further guidance on monetary policy [9] - The third-quarter earnings season is starting, with major companies like Delta Air Lines (DAL), PepsiCo (PEP), and Levi Strauss & Co. (LEVI) set to report [10] Market Sentiment - Overall market sentiment remains optimistic, driven by AI growth and resilient consumer spending, despite geopolitical uncertainties [11]

Key TakeawaysFifth Third Bancorp (FITB) is set to acquire Comerica (CMA) in an all-stock transaction valued at $10.9 billion, with Comerica shareholders receiving $82.88 per share.Qualtrics (XM) is reportedly acquiring Press Ganey Forsta for $6.75 billion, including debt, expanding its market research and experience management capabilities.Apple (AAPL) faces a French probe over Siri voice recordings, with allegations of GDPR violations and unlawful data processing without user consent.The ongoing government ...

Company Overview - Fifth Third Bancorp is based in Cincinnati, Ohio and was founded in 1858 [1] - The company has a market capitalization of $30 billion and assets exceeding $200 billion [1] Investment Focus - Binary Tree Analytics (BTA) specializes in providing transparency and analytics for capital markets instruments and trades, focusing on Closed-End Funds (CEFs), Exchange-Traded Funds (ETFs), and Special Situations [2] - BTA aims to deliver high annualized returns with a low volatility profile, leveraging over 20 years of investment experience [2]

Group 1 - The company reaffirmed its loan guidance and increased its PPNR guidance by 3% due to stronger fee income [2] - The company updated its credit loss outlook and shared positive developments regarding growth strategies [2] - A significant fraud issue was identified in the collateral file related to a client for whom the company provides an asset-backed warehouse facility [3][4] Group 2 - The client involved has been in business for nearly two decades, transacts with global lenders, and is backed by sophisticated equity investors [3] - The client is an issuer of rated securitizations and is audited by a major accounting firm [3]

Core Insights - Several banks, including JPMorgan Chase & Co., Fifth Third Bancorp, and Barclays Plc, are preparing for potential losses amounting to hundreds of millions of dollars linked to loans from subprime auto lender Tricolor Holdings [1] Group 1: Financial Impact - Fifth Third Bancorp disclosed in a regulatory filing that it anticipates an impairment charge of up to $200 million due to alleged fraudulent activities involving a commercial borrower [2] - The outstanding balance on Fifth Third's asset-backed finance loan related to Tricolor is approximately $200 million, with the bank expecting a non-cash charge of $170 million to $200 million in Q3 [4] Group 2: Company Operations - Tricolor specializes in lending to borrowers in the US southwest with poor or no credit scores, funding loans partially through asset-backed securities [3] - Recently, Tricolor sold a $217 million bond in early June, with JPMorgan and Barclays leading the offering [3] Group 3: Market Reaction - Following reports of Tricolor furloughing most of its staff, the company's asset-backed securities experienced a decline in trading value [5] - Fifth Third's shares fell by 2.5% to $44.30 in late trading [5]

Part I. Financial Information [Glossary of Abbreviations and Acronyms](index=5&type=section&id=Glossary%20of%20Abbreviations%20and%20Acronyms) This section defines abbreviations and acronyms used in the financial statements and MD&A, serving as a reference tool for readers - The glossary defines key financial and regulatory terms such as **ACL**, **FTE**, **NII**, and **CET1** to aid in understanding the report[10](index=10&type=chunk)[11](index=11&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (Item 2)](index=6&type=section&id=Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations%20%28Item%202%29) This section analyzes Fifth Third Bancorp's financial condition and operations, covering overview, non-GAAP measures, accounting standards, policies, income, balance sheet, segments, and risk management [Overview](index=6&type=section&id=Overview) Fifth Third Bancorp, with **$210 billion in assets**, is a diversified financial services company whose revenue is primarily driven by **67% net interest income** and **33% noninterest income**, influenced by market conditions and strategic share repurchases Fifth Third Bancorp Key Information (June 30, 2025) | Metric | Value | | :-------------------------------- | :------------------- | | Total Assets | $210 billion | | Banking Centers | 1,089 | | Branded ATMs | 2,170 | | Revenue Composition (FTE) | | | - Net Interest Income | 67% | | - Noninterest Income | 33% | - The Bancorp settled a **$225 million** accelerated share repurchase in Q1 2025 and authorized the purchase of **100 million** additional common shares on June 13, 2025[19](index=19&type=chunk) - On January 28, 2025, the Bank issued **$700 million** in fixed/floating-rate senior notes and **$300 million** in floating-rate senior notes, both due January 28, 2028[21](index=21&type=chunk)[22](index=22&type=chunk) - The 'One Big Beautiful Bill Act,' enacted July 4, 2025, introduced significant U.S. tax code changes, with the Bancorp evaluating its impact on the effective tax rate and deferred tax assets/liabilities, to be reflected in Q3 2025 financial statements[24](index=24&type=chunk) Key Performance Indicators (June 30, 2025 vs. 2024) | Indicator | Q2 2025 | Q2 2024 | % Change (QoQ) | H1 2025 | H1 2024 | % Change (YoY) | | :--------------------------------------- | :------ | :------ | :-------------- | :------ | :------ | :-------------- | | Net income available to common shareholders ($M) | $591 | $561 | 5% | $1,069 | $1,041 | 3% | | Diluted EPS | $0.88 | $0.81 | 9% | $1.58 | $1.51 | 5% | | Net interest income (FTE) ($M) | $1,500 | $1,393 | 8% | $2,942 | $2,783 | 6% | | Noninterest income ($M) | $750 | $695 | 8% | $1,444 | $1,406 | 3% | | Total revenue (FTE) ($M) | $2,250 | $2,088 | 8% | $4,386 | $4,189 | 5% | | Provision for credit losses ($M) | $173 | $97 | 78% | $347 | $191 | 82% | | Noninterest expense ($M) | $1,264 | $1,221 | 4% | $2,568 | $2,562 | —% | | Return on average assets | 1.20% | 1.14% | 5% | 1.09% | 1.06% | 3% | | Return on average common equity | 12.8% | 13.6% | (6)% | 11.8% | 12.6% | (6)% | | CET1 Capital Ratio | 10.58% | N/A | N/A | N/A | N/A | N/A | | Nonperforming Portfolio Assets Ratio | 0.72% | N/A | N/A | N/A | N/A | N/A | | Net Charge-off Ratio | 0.45% | 0.49% | (8)% | 0.45% | 0.44% | 2% | [Non-GAAP Financial Measures](index=11&type=section&id=Non-GAAP%20Financial%20Measures) This section reconciles non-GAAP financial measures, including net interest income (FTE), return on average tangible common equity, and tangible capital ratios, to U.S. GAAP for industry comparative analysis and additional performance insights - Non-GAAP measures such as **Net Interest Income (FTE)**, **Net Interest Margin (FTE)**, and **Efficiency Ratio (FTE)** are presented for tax-favored income adjustments and industry comparisons[38](index=38&type=chunk)[39](index=39&type=chunk) Non-GAAP Financial Measures (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--------------------------------------- | :------ | :------ | :------ | :------ | | Net interest income (U.S. GAAP) ($M) | $1,495 | $1,387 | $2,932 | $2,771 | | FTE adjustment ($M) | $5 | $6 | $10 | $12 | | Net interest income on an FTE basis ($M) | $1,500 | $1,393 | $2,942 | $2,783 | | Net interest margin on an FTE basis | 3.12% | 2.88% | 3.08% | 2.87% | | Net interest rate spread on an FTE basis | 2.40% | 2.04% | 2.36% | 2.04% | | Efficiency ratio on an FTE basis | 56.2% | 58.5% | 58.6% | 61.2% | Return on Average Tangible Common Equity (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--------------------------------------- | :------ | :------ | :------ | :------ | | Tangible net income available to common shareholders ($M) | $596 | $568 | $1,080 | $1,055 | | Average tangible common equity ($M) | $13,557 | $11,562 | $13,220 | $11,567 | | Return on average tangible common equity | 17.6% | 19.8% | 16.5% | 18.3% | Non-GAAP Capital Ratios (June 30, 2025 vs. Dec 31, 2024) | Metric | June 30, 2025 | Dec 31, 2024 | | :--------------------------------------- | :------------ | :----------- | | Tangible equity as a percentage of tangible assets | 9.39% | 9.02% | | Tangible common equity as a percentage of tangible assets | 8.38% | 8.03% | [Recent Accounting Standards](index=13&type=section&id=Recent%20Accounting%20Standards) The Bancorp adopted **ASU 2023-09** on January 1, 2025, amending income tax disclosures, and is evaluating **ASU 2024-03**, effective in 2027, for disaggregating income statement expenses - **ASU 2023-09**, adopted January 1, 2025, mandates new disclosures for effective tax rate reconciliation and income taxes paid, while discontinuing certain other requirements[328](index=328&type=chunk) - **ASU 2024-03**, effective in 2027, introduces new requirements for disaggregating income statement expenses, including compensation and depreciation, with the Bancorp currently evaluating its impact[329](index=329&type=chunk) [Critical Accounting Policies](index=13&type=section&id=Critical%20Accounting%20Policies) The Bancorp's critical accounting policies, including **ALLL**, reserve for unfunded commitments, and fair value measurements, involve significant judgment, with no material changes to valuation techniques during H1 2025 - Key critical accounting policies include **ALLL**, reserve for unfunded commitments, valuation of servicing rights, goodwill, legal contingencies, and fair value measurements[46](index=46&type=chunk) - No material changes to valuation techniques or models occurred during the six months ended June 30, 2025[46](index=46&type=chunk) [Statements of Income Analysis](index=13&type=section&id=Statements%20of%20Income%20Analysis) Net income available to common shareholders increased by **5% to $591 million** in Q2 2025 and **3% to $1.1 billion** in H1 2025, driven by higher net interest and noninterest income, despite increased provision for credit losses and noninterest expenses Net Income Available to Common Shareholders (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 ($M) | Q2 2024 ($M) | % Change (QoQ) | | :--------------------------------------- | :----------- | :----------- | :-------------- | | Net income available to common shareholders | $591 | $561 | 5% | | Diluted EPS | $0.88

[Executive Summary & Key Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Key%20Highlights) Fifth Third Bancorp achieved strong Q2 2025 results, marked by increased diluted EPS, expanding net interest margin, improved credit quality, and robust loan growth [Key Financial Data & Highlights](index=1&type=section&id=Key%20Financial%20Data) Fifth Third Bancorp reported strong Q2 2025 results with diluted EPS of $0.88, driven by accelerating revenue growth from continued loan growth and net interest margin expansion. The company demonstrated stability with declining net charge-off ratios and nonperforming assets, improved profitability through disciplined expense management and NIM expansion, and robust loan and asset under management growth Key Financial Data (2Q25 vs. 1Q25 vs. 2Q24) | Key Financial Data | 2Q25 | 1Q25 | 2Q24 | | :------------------------------------ | :--- | :--- | :--- | | **Income Statement Data ($ in millions)** | | | | | Net income available to common shareholders | $591 | $478 | $561 | | Net interest income (U.S. GAAP) | 1,495 | 1,437 | 1,387 | | Net interest income (FTE) (a) | 1,500 | 1,442 | 1,393 | | Noninterest income | 750 | 694 | 695 | | Noninterest expense | 1,264 | 1,304 | 1,221 | | **Per Share Data ($)** | | | | | Earnings per share, basic | $0.88 | $0.71 | $0.82 | | Earnings per share, diluted | 0.88 | 0.71 | 0.81 | | Book value per share | 28.47 | 27.41 | 25.13 | | (a) Tangible book value per share | 20.98 | 19.92 | 17.75 | | **Balance Sheet & Credit Quality ($ in millions, except percentages)** | | | | | Average portfolio loans and leases | $123,071 | $121,272 | $116,891 | | Average deposits | 163,575 | 164,157 | 167,194 | | Accumulated other comprehensive loss | (3,546) | (3,895) | (4,901) | | (b) Net charge-off ratio | 0.45 % | 0.46 % | 0.49 % | | Nonperforming asset ratio (c) | 0.72 | 0.81 | 0.55 | | **Financial Ratios (percentages)** | | | | | Return on average assets | 1.20 % | 0.99 % | 1.14 % | | Return on average common equity | 12.8 | 10.8 | 13.6 | | Return on average tangible common equity (a) | 17.6 | 15.2 | 19.8 | | (d)(e) CET1 capital | 10.56 | 10.43 | 10.62 | | (a) Net interest margin | 3.12 | 3.03 | 2.88 | | (a) Efficiency | 56.2 | 61.0 | 58.5 | - Key Highlights: - **Stability**: Net charge-off ratio declined **1 bp sequentially** and **4 bps compared to 2Q24**; NPAs decreased **11% sequentially**. Interest-bearing liabilities costs down **2 bps QoQ**; **4% DDA growth YoY**. Strong profitability resulted in **CET1 increasing 13 bps to 10.56%**[1](index=1&type=chunk) - **Profitability**: Disciplined expense management; efficiency ratio of **56.2%**; adjusted efficiency ratio of **55.5%**, an improvement of **130 bps YoY**. Net interest margin expanded for the **6th consecutive quarter**. Adjusted ROTCE ex. AOCI of **13.9%** and adjusted ROA of **1.22%**[1](index=1&type=chunk) - **Growth**: **5% loan growth compared to 2Q24**; annual loan growth reaches highest level in over two years. Consumer household growth of **2%**, including **6% in the Southeast**. Assets under management of **$73 billion**, up **12% compared to 2Q24**[1](index=1&type=chunk) [CEO Statement](index=1&type=section&id=From%20Tim%20Spence%2C%20Fifth%20Third%20Chairman%2C%20CEO%20and%20President) CEO Tim Spence highlighted the strong balance sheet, diverse revenue streams, and disciplined expense management, leading to expanded net interest margin, improved credit metrics, and a strengthened efficiency ratio - Adjusted revenues and adjusted PPNR increased year-over-year by **6%** and **10%**, respectively, marking the highest growth rate in the past two years[3](index=3&type=chunk) - CET1 capital increased **13 basis points to 10.56%** and tangible book value per share grew **18% over the past year**[1](index=1&type=chunk)[3](index=3&type=chunk) - The company will continue to adhere to its operating principles of stability, profitability, and growth – in that order[5](index=5&type=chunk) [Financial Performance Overview](index=2&type=section&id=Financial%20Performance%20Overview) Fifth Third Bancorp's Q2 2025 financial performance showed significant revenue growth, disciplined expense management, and continued balance sheet expansion [Income Statement Highlights](index=2&type=section&id=Income%20Statement%20Highlights) Fifth Third Bancorp reported a significant sequential increase in net income available to common shareholders and diluted EPS for Q2 2025, with NII and noninterest income also showing strong growth Condensed Statements of Income (2Q25 vs. 1Q25 vs. 2Q24) | ($ in millions, except per share data) | June 2025 | March 2025 | June 2024 | % Change Seq | % Change Yr/Yr | | :----------------------------------- | :-------- | :--------- | :-------- | :----------- | :------------- | | (a) Net interest income (NII) | $1,500 | $1,442 | $1,393 | 4% | 8% | | Provision for credit losses | 173 | 174 | 97 | (1)% | 78% | | Noninterest income | 750 | 694 | 695 | 8% | 8% | | Noninterest expense | 1,264 | 1,304 | 1,221 | (3)% | 4% | | Income before income taxes (a) | $813 | $658 | $770 | 24% | 6% | | Net income available to common shareholders | $591 | $478 | $561 | 24% | 5% | | Earnings per share, diluted | $0.88 | $0.71 | $0.81 | 24% | 9% | - Diluted earnings per share impact of certain item(s) was **$(0.02) in 2Q25**, primarily due to severance expense and valuation of Visa total return swap[6](index=6&type=chunk) [Net Interest Income (NII)](index=3&type=section&id=Net%20Interest%20Income) Net Interest Income (NII) increased sequentially by 4% and year-over-year by 8%, driven by higher average loan balances, fixed-rate asset repricing, and strategic deposit management Net Interest Income (FTE) and Average Yield/Rate Analysis | (a) (FTE; $ in millions) | June 2025 | March 2025 | June 2024 | % Change Seq | % Change Yr/Yr | | :----------------------- | :-------- | :--------- | :-------- | :----------- | :------------- | | Net interest income (NII) | $1,500 | $1,442 | $1,393 | 4% | 8% | | Yield on interest-earning assets | 5.18 % | 5.13 % | 5.43 % | 5 bps | (25) bps | | Rate paid on interest-bearing liabilities | 2.78 % | 2.80 % | 3.39 % | (2) bps | (61) bps | | Net interest rate spread | 2.40 % | 2.33 % | 2.04 % | 7 bps | 36 bps | | Net interest margin (NIM) | 3.12 % | 3.03 % | 2.88 % | 9 bps | 24 bps | - NII increased **$58 million, or 4%**, compared to the prior quarter, primarily reflecting higher average loan balances, fixed-rate asset repricing, and strategic deposit management actions decreasing the cost of interest-bearing deposits[7](index=7&type=chunk) - Net interest margin (NIM) increased **9 bps sequentially** and **24 bps year-over-year**, marking the **6th consecutive quarter of expansion**[1](index=1&type=chunk)[7](index=7&type=chunk)[8](index=8&type=chunk) [Noninterest Income](index=4&type=section&id=Noninterest%20Income) Reported noninterest income increased 8% sequentially and year-over-year. Excluding certain items, noninterest income grew 2% sequentially and 3% year-over-year, with consumer banking revenue and mortgage banking net revenue showing notable increases Noninterest Income (2Q25 vs. 1Q25 vs. 2Q24) | ($ in millions) | June 2025 | March 2025 | June 2024 | % Change Seq | % Change Yr/Yr | | :------------------------ | :-------- | :--------- | :-------- | :----------- | :------------- | | Wealth and asset management revenue | $166 | $172 | $159 | (3)% | 4% | | Commercial payments revenue | 152 | 153 | 154 | (1)% | (1)% | | Consumer banking revenue | 147 | 137 | 139 | 7% | 6% | | Capital markets fees | 90 | 90 | 93 | — | (3)% | | Commercial banking revenue | 79 | 80 | 90 | (1)% | (12)% | | Mortgage banking net revenue | 56 | 57 | 50 | (2)% | 12% | | Other noninterest income | 44 | 14 | 7 | 214% | 529% | | Securities gains (losses), net | 16 | (9) | 3 | NM | 433% | | Total noninterest income | $750 | $694 | $695 | 8% | 8% | Noninterest Income excluding certain items (2Q25 vs. 1Q25 vs. 2Q24) | ($ in millions) | June 2025 | March 2025 | June 2024 | % Change Seq | % Change Yr/Yr | | :-------------- | :-------- | :--------- | :-------- | :----------- | :------------- | | Noninterest income (U.S. GAAP) | $750 | $694 | $695 | | | | Valuation of Visa total return swap | 1 | 18 | 23 | | | | Legal settlements and remediations | — | — | 2 | | | | Securities (gains) losses, net | (16) | 9 | (3) | | | | Noninterest income excluding certain items (a) | $735 | $721 | $717 | 2% | 3% | - Consumer banking revenue increased **$10 million, or 7% sequentially**, driven by card and processing revenue and deposit fees[11](index=11&type=chunk) - Mortgage banking net revenue increased **$6 million, or 12% year-over-year**, due to the prior year loss on MSR net valuation adjustments not recurring in the current quarter[12](index=12&type=chunk) [Noninterest Expense](index=5&type=section&id=Noninterest%20Expense) Reported noninterest expense decreased 3% sequentially but increased 4% year-over-year. Excluding certain items, noninterest expense decreased 4% sequentially, primarily due to a seasonal decrease in compensation and benefits Noninterest Expense (2Q25 vs. 1Q25 vs. 2Q24) | ($ in millions) | June 2025 | March 2025 | June 2024 | % Change Seq | % Change Yr/Yr | | :------------------------ | :-------- | :--------- | :-------- | :----------- | :------------- | | Compensation and benefits | $698 | $750 | $656 | (7)% | 6% | | Technology and communications | 126 | 123 | 114 | 2% | 11% | | Net occupancy expense | 83 | 87 | 83 | (5)% | — | | Equipment expense | 41 | 42 | 38 | (2)% | 8% | | Loan and lease expense | 36 | 30 | 33 | 20% | 9% | | Marketing expense | 43 | 28 | 34 | 54% | 26% | | Card and processing expense | 22 | 21 | 21 | 5% | 5% | | Other noninterest expense | 215 | 223 | 242 | (4)% | (11)% | | Total noninterest expense | $1,264 | $1,304 | $1,221 | (3)% | 4% | Noninterest Expense excluding certain item(s) (2Q25 vs. 1Q25 vs. 2Q24) | ($ in millions) | June 2025 | March 2025 | June 2024 | % Change Seq | % Change Yr/Yr | | :-------------- | :-------- | :--------- | :-------- | :----------- | :------------- | | Noninterest expense (U.S. GAAP) | $1,264 | $1,304 | $1,221 | | | | Severance expense | (15) | — | — | | | | Legal settlements and remediations | — | — | (11) | | | | FDIC special assessment | — | — | (6) | | | | Noninterest expense excluding certain item(s) (a) | $1,249 | $1,304 | $1,204 | (4)% | 4% | - Noninterest expense excluding certain items decreased **$55 million, or 4%**, compared to the prior quarter, primarily reflecting a seasonal decrease in compensation and benefits expense[14](index=14&type=chunk) [Balance Sheet Highlights](index=6&type=section&id=Balance%20Sheet%20Highlights) The balance sheet showed continued loan growth, particularly in consumer segments, while average deposits remained stable sequentially and wholesale funding decreased year-over-year, reflecting proactive liability management [Average Interest-Earning Assets](index=6&type=section&id=Average%20Interest-Earning%20Assets) Total average portfolio loans and leases increased 1% sequentially and 5% year-over-year, driven by growth in both commercial and consumer segments. Securities and other short-term investments decreased, reflecting liability management and increased lending Average Portfolio Loans and Leases (2Q25 vs. 1Q25 vs. 2Q24) | ($ in millions) | June 2025 | March 2025 | June 2024 | % Change Seq | % Change Yr/Yr | | :------------------------------ | :-------- | :--------- | :-------- | :----------- | :------------- | | Commercial loans and leases: | | | | | | | Commercial and industrial loans | $54,075 | $53,401 | $52,357 | 1% | 3% | | Commercial mortgage loans | 12,410 | 12,368 | 11,352 | — | 9% | | Commercial construction loans | 5,810 | 5,797 | 5,917 | — | (2)% | | Commercial leases | 3,120 | 3,110 | 2,575 | — | 21% | | Total commercial loans and leases | $75,415 | $74,676 | $72,201 | 1% | 4% | | Consumer loans: | | | | | | | Residential mortgage loans | $17,615 | $17,552 | $17,004 | — | 4% | | Home equity | 4,383 | 4,222 | 3,929 | 4% | 12% | | Indirect secured consumer loans | 17,248 | 16,476 | 15,373 | 5% | 12% | | Credit card | 1,659 | 1,627 | 1,728 | 2% | (4)% | | Solar energy installation loans | 4,268 | 4,221 | 3,916 | 1% | 9% | | Other consumer loans | 2,483 | 2,498 | 2,740 | (1)% | (9)% | | Total consumer loans | $47,656 | $46,596 | $44,690 | 2% | 7% | | Total average portfolio loans and leases | $123,071 | $121,272 | $116,891 | 1% | 5% | - Total average portfolio loans and leases increased **1% sequentially** and **5% year-over-year**[16](index=16&type=chunk)[17](index=17&type=chunk) - Average other short-term investments decreased **12% sequentially** and **38% year-over-year** due to proactive liability management and increased lending activity[18](index=18&type=chunk) [Average Deposits](index=8&type=section&id=Average%20Deposits) Total average deposits were stable sequentially, with demand deposits increasing and interest checking/savings declining. Year-over-year, total average deposits decreased 2%, primarily due to reduced brokered deposits. The period-end loan-to-core deposit ratio increased to 76% Average Deposits (2Q25 vs. 1Q25 vs. 2Q24) | ($ in millions) | June 2025 | March 2025 | June 2024 | % Change Seq | % Change Yr/Yr | | :------------------------ | :-------- | :--------- | :-------- | :----------- | :------------- | | Demand | $40,885 | $39,788 | $40,266 | 3% | 2% | | Interest checking | 56,738 | 57,964 | 58,156 | (2)% | (2)% | | Savings | 16,962 | 17,226 | 17,747 | (2)% | (4)% | | Money market | 36,296 | 36,453 | 35,511 | — | 2% | | Total transaction deposits | $150,881 | $151,431 | $151,680 | — | (1)% | | CDs $250,000 or less | 10,494 | 10,380 | 10,767 | 1% | (3)% | | Total core deposits | $161,375 | $161,811 | $162,447 | — | (1)% | | CDs over $250,000 | 2,200 | 2,346 | 4,747 | (6)% | (54)% | | Total average deposits | $163,575 | $164,157 | $167,194 | — | (2)% | - Demand deposits increased **3% sequentially**, a result of the focus on improving deposit mix, leading to four consecutive quarters of declining deposit costs[22](index=22&type=chunk) - The period-end portfolio loan-to-core deposit ratio was **76%** in the current quarter, compared to **75%** in the prior quarter and **72%** in the year-ago quarter[23](index=23&type=chunk) [Average Wholesale Funding](index=8&type=section&id=Average%20Wholesale%20Funding) Average wholesale funding increased 1% sequentially but decreased 7% year-over-year, primarily due to lower balances in CDs over $250,000 and long-term debt, partially offset by increased FHLB advances Average Wholesale Funding (2Q25 vs. 1Q25 vs. 2Q24) | ($ in millions) | June 2025 | March 2025 | June 2024 | % Change Seq | % Change Yr/Yr | | :-------------------------------- | :-------- | :--------- | :-------- | :----------- | :------------- | | CDs over $250,000 | $2,200 | $2,346 | $4,747 | (6)% | (54)% | | Federal funds purchased | 206 | 194 | 230 | 6% | (10)% | | Securities sold under repurchase agreements | 353 | 286 | 373 | 23% | (5)% | | FHLB advances | 4,976 | 4,767 | 3,165 | 4% | 57% | | Derivative collateral and other secured borrowings | 89 | 84 | 54 | 6% | 65% | | Long-term debt | 14,599 | 14,585 | 15,611 | — | (6)% | | Total average wholesale funding | $22,423 | $22,262 | $24,180 | 1% | (7)% | - Average wholesale funding increased **1% sequentially**, driven by higher short-term FHLB advances and securities sold under repurchase agreements, partially offset by a reduction in CDs over **$250,000**[24](index=24&type=chunk) - The **7% decrease** in average wholesale funding compared to the year-ago quarter was primarily due to lower balances in CDs over **$250,000** and long-term debt[24](index=24&type=chunk) [Credit Quality Summary](index=10&type=section&id=Credit%20Quality%20Summary) Credit quality metrics showed improvement sequentially, with the net charge-off ratio declining and nonperforming assets decreasing, while the Allowance for Credit Losses (ACL) remained strong Credit Quality Summary (2Q25 vs. 1Q25 vs. 2Q24) | ($ in millions) | June 2025 | March 2025 | June 2024 | | :-------------- | :-------- | :--------- | :-------- | | Total nonaccrual portfolio loans and leases (NPLs) | $853 | $966 | $606 | | Total nonperforming portfolio loans and leases and OREO (NPAs) | $886 | $996 | $643 | | NPL ratio | 0.70 % | 0.79 % | 0.52 % | | NPA ratio | 0.72 % | 0.81 % | 0.55 % | | Provision for loan and lease losses | 167 | 168 | 114 | | ALLL, ending | $2,412 | $2,384 | $2,288 | | Total allowance for credit losses (ACL) | $2,558 | $2,524 | $2,425 | | ACL as a % of portfolio loans and leases | 2.09 % | 2.07 % | 2.08 % | | ACL as a % of nonperforming portfolio loans and leases | 300 % | 261 % | 400 % | | Total net losses charged-off | $(139) | $(136) | $(144) | | Net charge-off ratio (NCO ratio) | 0.45 % | 0.46 % | 0.49 % | | Commercial NCO ratio | 0.38 % | 0.35 % | 0.45 % | | Consumer NCO ratio | 0.56 % | 0.63 % | 0.57 % | - The net charge-off ratio (NCO ratio) decreased **1 bp sequentially to 0.45%** and **4 bps compared to 2Q24**[1](index=1&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk) - Nonperforming portfolio assets (NPAs) totaled **$886 million** in the current quarter, resulting in an NPA ratio of **0.72%**, compared to **0.81%** in the prior quarter, a decrease of **11% sequentially**[1](index=1&type=chunk)[29](index=29&type=chunk) - The Allowance for Credit Losses (ACL) ratio represented **2.09% of total portfolio loans and leases** and covered **300% of nonperforming portfolio loans and leases**[26](index=26&type=chunk) [Capital Position](index=11&type=section&id=Capital%20Position) Fifth Third Bancorp maintained a strong capital position, with the CET1 capital ratio increasing sequentially to 10.56% due to strong profitability, and approved a new share repurchase authorization Capital Position (Regulatory Capital Ratios) | Capital Position | June 2025 | March 2025 | June 2024 | | :--------------- | :-------- | :--------- | :-------- | | CET1 capital | 10.56 % | 10.43 % | 10.62 % | | Tier 1 risk-based capital | 11.83 % | 11.71 % | 11.93 % | | Total risk-based capital | 13.75 % | 13.63 % | 13.95 % | | Leverage | 9.42 % | 9.23 % | 9.07 % | - The CET1 capital ratio of **10.56%** increased **13 bps sequentially**, driven by strong profitability[1](index=1&type=chunk)[30](index=30&type=chunk) - Fifth Third's Board of Directors approved a new share repurchase authorization of up to **100 million shares** in June 2025, with no expiration date[31](index=31&type=chunk) [Other Information](index=12&type=section&id=Other%20Information) This section provides supplementary details on tax rates, conference calls, corporate profile, forward-looking statements, and earnings release end notes [Tax Rate](index=12&type=section&id=Tax%20Rate) The effective tax rate for Q2 2025 was 22.2%, an increase from 21.2% in the prior quarter and 21.3% in the year-ago quarter - The effective tax rate for the quarter was **22.2%** compared with **21.2%** in the prior quarter and **21.3%** in the year-ago quarter[32](index=32&type=chunk) [Conference Call](index=12&type=section&id=Conference%20Call) Fifth Third Bancorp will host a conference call to discuss financial results, accessible via live webcast and replay on its Investor Relations website - Fifth Third will host a conference call to discuss these financial results at **9:00 a.m. (Eastern Time)**, accessible via live webcast and replay through the Fifth Third Investor Relations website at www.53.com[33](index=33&type=chunk) [Corporate Profile](index=12&type=section&id=Corporate%20Profile) Fifth Third is a US-based bank known for innovation, ethical practices, and a commitment to customers, employees, communities, and shareholders, aiming to be a high-performing regional bank valued for trust - Fifth Third is a bank founded in **1858**, focused on innovation, dedicated people, and community impact[34](index=34&type=chunk) - The company has been named among Ethisphere's **World's Most Ethical Companies®** for several years[34](index=34&type=chunk) - Fifth Third Bancorp's common stock is traded on the NASDAQ® Global Select Market under the symbol **"FITB"**[35](index=35&type=chunk) [Forward-Looking Statements](index=13&type=section&id=FORWARD-LOOKING%20STATEMENTS) The release contains forward-looking statements subject to various risks and uncertainties, including credit quality, funding, regulatory changes, economic conditions, and competition - The release contains forward-looking statements subject to risks and uncertainties, including deteriorating credit quality, inadequate funding, cyber-security risks, government regulation, changes in interest rates, and economic uncertainty[37](index=37&type=chunk)[38](index=38&type=chunk) - Readers should not place undue reliance on these statements and should refer to SEC filings for further information on other factors that could cause actual results to differ materially[37](index=37&type=chunk)[39](index=39&type=chunk) - The company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements, except as may be required by law[39](index=39&type=chunk) [Earnings Release End Notes](index=12&type=section&id=Earnings%20Release%20End%20Notes) This section provides definitions and clarifications for various financial measures and ratios used in the earnings release, including non-GAAP measures, net charge-off ratio, nonperforming asset ratio, and regulatory capital ratio calculations - Provides definitions for non-GAAP measures, net losses charged-off as a percent of average portfolio loans and leases (annualized), nonperforming portfolio assets as a percent of portfolio loans and leases and OREO, and regulatory capital ratio calculations[36](index=36&type=chunk) [Quarterly Financial Review (Detailed Tables)](index=14&type=section&id=Quarterly%20Financial%20Review%20for%20June%2030%2C%202025) This section presents comprehensive detailed financial tables, covering income statements, balance sheets, equity changes, and key financial metrics [Financial Highlights (Detailed)](index=15&type=section&id=Financial%20Highlights) This section provides a comprehensive overview of Fifth Third Bancorp's financial performance and position, including detailed income statement data, per share data, common share data, financial ratios, credit quality metrics, average balances, and regulatory capital ratios for the current and prior periods Financial Highlights (2Q25 vs. 1Q25 vs. 2Q24) | Financial Highlights | June 2025 | March 2025 | June 2024 | Seq % Change | Yr/Yr % Change | | :------------------- | :-------- | :--------- | :-------- | :----------- | :------------- | | **Income Statement Data ($ in millions)** | | | | | | | Net interest income (FTE) | $1,500 | $1,442 | $1,393 | 4% | 8% | | Total revenue (FTE) | 2,250 | 2,136 | 2,088 | 5% | 8% | | Net income available to common shareholders | 591 | 478 | 561 | 24% | 5% | | Earnings per share, diluted | $0.88 | $0.71 | $0.81 | 24% | 9% | | **Financial Ratios (percentages)** | | | | | | | Return on average assets | 1.20 % | 0.99 % | 1.14 % | 21 bps | 6 bps | | Net interest margin (FTE) | 3.12 % | 3.03 % | 2.88 % | 9 bps | 24 bps | | Efficiency (FTE) | 56.2 % | 61.0 % | 58.5 % | (480) bps | (230) bps | | **Credit Quality (percentages)** | | | | | | | Net losses charged-off as a percent of average portfolio loans and leases (annualized) | 0.45 % | 0.46 % | 0.49 % | (1) bps | (4) bps | | Nonperforming portfolio assets as a percent of portfolio loans and leases and OREO | 0.72 % | 0.81 % | 0.55 % | (9) bps | 17 bps | | **Average Balances ($ in millions)** | | | | | | | Loans and leases, including held for sale | $123,657 | $121,764 | $117,283 | 2% | 5% | | Assets | 210,554 | 210,558 | 212,475 | — | (1)% | | Total deposits | 163,575 | 164,157 | 167,194 | — | (2)% | | **Regulatory Capital Ratios (percentages)** | | | | | | | CET1 capital | 10.56 % | 10.43 % | 10.62 % | 13 bps | (6) bps | - Assets under management increased **12% year-over-year to $73 billion**[43](index=43&type=chunk) [Consolidated Statements of Income](index=19&type=section&id=Consolidated%20Statements%20of%20Income) Detailed consolidated income statements show total interest income decreased 5% YoY, while total interest expense decreased 20% YoY, leading to an 8% YoY increase in Net Interest Income. Noninterest income increased 8% YoY, and total noninterest expense increased 4% YoY Consolidated Statements of Income (2Q25 vs. 1Q25 vs. 2Q24) | $ in millions | June 2025 | March 2025 | June 2024 | Seq % Change | Yr/Yr % Change | | :------------ | :-------- | :--------- | :-------- | :----------- | :------------- | | **Interest Income** | | | | | | | Total interest income | 2,484 | 2,432 | 2,620 | 2% | (5)% | | **Interest Expense** | | | | | | | Total interest expense | 989 | 995 | 1,233 | (1)% | (20)% | | **Net Interest Income** | 1,495 | 1,437 | 1,387 | 4% | 8% | | Provision for credit losses | 173 | 174 | 97 | (1)% | 78% | | **Noninterest Income** | | | | | | | Total noninterest income | 750 | 694 | 695 | 8% | 8% | | **Noninterest Expense** | | | | | | | Total noninterest expense | 1,264 | 1,304 | 1,221 | (3)% | 4% | | Income Before Income Taxes | 808 | 653 | 764 | 24% | 6% | | Net Income | 628 | 515 | 601 | 22% | 4% | | Net Income Available to Common Shareholders | $591 | $478 | $561 | 24% | 5% | - Total interest income decreased **5% year-over-year**, primarily due to a **50% decrease** in interest on other short-term investments[48](index=48&type=chunk) - Total interest expense decreased **20% year-over-year**, mainly driven by a **24% decrease** in interest on deposits[48](index=48&type=chunk) [Consolidated Balance Sheets](index=21&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets show a 2% YoY decrease in total assets. Portfolio loans and leases increased 5% YoY, while other short-term investments decreased 38% YoY. Total deposits decreased 2% YoY, with a significant 41% YoY decrease in CDs over $250,000 Consolidated Balance Sheets (2Q25 vs. 1Q25 vs. 2Q24) | $ in millions | June 2025 | March 2025 | June 2024 | Seq % Change | Yr/Yr % Change | | :------------ | :-------- | :--------- | :-------- | :----------- | :------------- | | **Assets** | | | | | | | Total Assets | $209,991 | $212,669 | $213,262 | (1)% | (2)% | | Other short-term investments | 13,043 | 14,965 | 21,085 | (13)% | (38)% | | Portfolio loans and leases | 122,396 | 122,191 | 116,579 | — | 5% | | Allowance for loan and lease losses | (2,412) | (2,384) | (2,288) | 1% | 5% | | **Liabilities** | | | | | | | Total deposits | 164,207 | 165,505 | 166,768 | (1)% | (2)% | | CDs over $250,000 | 2,426 | 1,894 | 4,082 | 28% | (41)% | | Total Liabilities | 188,867 | 192,266 | 194,036 | (2)% | (3)% | | **Equity** | | | | | | | Total Equity | 21,124 | 20,403 | 19,226 | 4% | 10% | - Total Assets decreased **2% year-over-year to $209,991 million**[50](index=50&type=chunk) - Portfolio loans and leases increased **5% year-over-year to $122,396 million**[50](index=50&type=chunk) - Total deposits decreased **2% year-over-year to $164,207 million**, with CDs over **$250,000 decreasing 41% YoY**[50](index=50&type=chunk) [Consolidated Statements of Changes in Equity](index=26&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Equity) Total equity increased to $21,124 million at the end of Q2 2025, up from $19,226 million in Q2 2024, driven by net income and significant positive changes in unrealized gains on available-for-sale debt securities and qualifying cash flow hedges Consolidated Statements of Changes in Equity (2Q25 vs. 2Q24) | $ in millions | June 2025 | June 2024 | | :------------ | :-------- | :-------- | | Total Equity, Beginning | $20,403 | $19,018 | | Net income | 628 | 601 | | Other comprehensive income (loss), net of tax: | | | | Change in unrealized gains (losses): | | | | Available-for-sale debt securities | 179 | 2 | | Qualifying cash flow hedges | 148 | (40) | | Comprehensive income | 977 | 588 | | Cash dividends declared: | | | | Common stock | (250) | (243) | | Preferred stock | (37) | (40) | | Total Equity, Ending | $21,124 | $19,226 | - Total Equity increased from **$19,226 million in June 2024 to $21,124 million in June 2025**[52](index=52&type=chunk) - Comprehensive income for Q2 2025 was **$977 million**, including **$179 million** from available-for-sale debt securities and **$148 million** from qualifying cash flow hedges[52](index=52&type=chunk) [Average Balance Sheets and Yield/Rate Analysis](index=27&type=section&id=Average%20Balance%20Sheets%20and%20Yield%2FRate%20Analysis) This section provides detailed average balance sheets and yield/rate analysis for interest-earning assets and interest-bearing liabilities, highlighting the expansion of net interest margin (FTE) to 3.12% in Q2 2025, driven by a 61 bps decrease in the rate paid on interest-bearing liabilities Average Balance Sheets and Yield/Rate Analysis (2Q25 vs. 1Q25 vs. 2Q24) | $ in millions | June 2025 Average Balance | June 2025 Average Yield/Rate | March 2025 Average Balance | March 2025 Average Yield/Rate | June 2024 Average Balance | June 2024 Average Yield/Rate | | :------------ | :------------------------ | :--------------------------- | :------------------------- | :---------------------------- | :------------------------ | :--------------------------- | | **Assets** | | | | | | | | Total interest-earning assets | 192,682 | 5.18 % | 192,808 | 5.13 % | 194,499 | 5.43 % | | **Liabilities** | | | | | | | | Total interest-bearing liabilities | 142,913 | 2.78 % | 144,285 | 2.80 % | 146,361 | 3.39 % | | **Ratios** | | | | | | | | Net interest margin (FTE) | | 3.12 % | | 3.03 % | | 2.88 % | | Net interest rate spread (FTE) | | 2.40 % | | 2.33 % | | 2.04 % | - Yield on interest-earning assets decreased **25 bps year-over-year to 5.18%**[7](index=7&type=chunk)[53](index=53&type=chunk) - Rate paid on interest-bearing liabilities decreased **61 bps year-over-year to 2.78%**[7](index=7&type=chunk)[53](index=53&type=chunk) - Net interest margin (FTE) increased **24 bps year-over-year to 3.12%**[7](index=7&type=chunk)[53](index=53&type=chunk) [Summary of Loans and Leases](index=30&type=section&id=Summary%20of%20Loans%20and%20Leases) The summary details average and period-end portfolio loans and leases, showing overall growth. Total average portfolio loans and leases increased 5% YoY, with significant growth in commercial leases (21% YoY) and indirect secured consumer loans (12% YoY) Total Average Portfolio Loans and Leases (2Q25 vs. 1Q25 vs. 2Q24) | $ in millions | June 2025 | March 2025 | June 2024 | | :------------ | :-------- | :--------- | :-------- | | Total average portfolio loans and leases | $123,071 | $121,272 | $116,891 | | Commercial leases | 3,120 | 3,110 | 2,575 | | Indirect secured consumer loans | 17,248 | 16,476 | 15,373 | - Total average portfolio loans and leases increased to **$123,071 million in 2Q25**, up **5% year-over-year**[57](index=57&type=chunk) - Average commercial leases increased **21% year-over-year to $3,120 million**[57](index=57&type=chunk) - Average indirect secured consumer loans increased **12% year-over-year to $17,248 million**[57](index=57&type=chunk) [Regulatory Capital (Detailed)](index=31&type=section&id=Regulatory%20Capital) Fifth Third Bancorp's regulatory capital ratios remained strong, with CET1 capital at 10.56% and Tier 1 risk-based capital at 11.83% for the Bancorp. Fifth Third Bank, National Association also showed robust capital levels, exceeding regulatory minimums Regulatory Capital Ratios (Bancorp and Bank) | Regulatory Capital Ratios | June 2025 | March 2025 | June 2024 | | :------------------------ | :-------- | :--------- | :-------- | | **Fifth Third Bancorp** | | | | | CET1 capital | 10.56 % | 10.43 % | 10.62 % | | Tier 1 risk-based capital | 11.83 % | 11.71 % | 11.93 % | | Total risk-based capital | 13.75 % | 13.63 % | 13.95 % | | Leverage | 9.42 % | 9.23 % | 9.07 % | | **Fifth Third Bank, National Association** | | | | | Tier 1 risk-based capital | 12.85 % | 12.78 % | 12.81 % | | Total risk-based capital | 14.09 % | 14.02 % | 14.14 % | | Leverage | 10.26 % | 10.10 % | 9.76 % | - Fifth Third Bancorp's CET1 capital was **$17,616 million**, with a ratio of **10.56% in June 2025**[58](index=58&type=chunk) - Fifth Third Bank, National Association reported a Tier 1 risk-based capital ratio of **12.85%** and a Leverage ratio of **10.26% in June 2025**[58](index=58&type=chunk) [Summary of Credit Loss Experience (Detailed)](index=32&type=section&id=Summary%20of%20Credit%20Loss%20Experience) This section provides a detailed breakdown of credit loss experience, including losses charged-off, recoveries, and net losses charged-off by loan category. The total net losses charged-off decreased 3% YoY, and the overall net charge-off ratio declined to 0.45% Net Losses Charged-Off by Loan Type (2Q25 vs. 1Q25 vs. 2Q24) | $ in millions | June 2025 | March 2025 | June 2024 | | :------------ | :-------- | :--------- | :-------- | | **Total net losses charged-off** | $(139) | $(136) | $(144) | | Commercial and industrial loans | $(69) | $(52) | $(80) | | Indirect secured consumer loans | (16) | (21) | (17) | | Credit card | (15) | (17) | (17) | | Solar energy installation loans | (20) | (18) | (12) | Net Losses Charged-Off as a Percent of Average Portfolio Loans and Leases (Annualized) (2Q25 vs. 1Q25 vs. 2Q24) | (annualized) | June 2025 | March 2025 | June 2024 | | :----------- | :-------- | :--------- | :-------- | | Total commercial loans and leases | 0.38 % | 0.35 % | 0.45 % | | Total consumer loans | 0.56 % | 0.63 % | 0.57 % | | Total net losses charged-off as a percent of average portfolio loans and leases | 0.45 % | 0.46 % | 0.49 % | - Total net losses charged-off decreased to **$139 million in 2Q25**, down **$5 million or 3%** compared to the year-ago quarter[28](index=28&type=chunk)[60](index=60&type=chunk) - The commercial NCO ratio decreased **7 bps year-over-year to 0.38%**, and the consumer NCO ratio decreased **1 bp year-over-year to 0.56%**[28](index=28&type=chunk)[61](index=61&type=chunk) [Asset Quality (Detailed)](index=34&type=section&id=Asset%20Quality) Detailed asset quality metrics show a sequential decrease in nonperforming assets and nonaccrual portfolio loans. The Allowance for Credit Losses (ACL) increased to $2,558 million, maintaining strong coverage ratios against nonperforming assets Allowance for Credit Losses and Nonperforming Assets (2Q25 vs. 1Q25 vs. 2Q24) | $ in millions | June 2025 | March 2025 | June 2024 | | :------------ | :-------- | :--------- | :-------- | | Allowance for loan and lease losses, ending | $2,412 | $2,384 | $2,288 | | Reserve for unfunded commitments, ending | $146 | $140 | $137 | | Total allowance for credit losses | $2,558 | $2,524 | $2,425 | | Total nonaccrual portfolio loans and leases | 853 | 966 | 606 | | Total nonperforming portfolio loans and leases and OREO | 886 | 996 | 643 | | Total nonperforming assets | $913 | $1,017 | $647 | | ACL as a percent of portfolio loans and leases | 2.09 % | 2.07 % | 2.08 % | | ACL as a percent of nonperforming portfolio loans and leases | 300 % | 261 % | 400 % | | Nonperforming portfolio assets as a percent of portfolio loans and leases and OREO | 0.72 % | 0.81 % | 0.55 % | - Total nonperforming assets decreased to **$913 million in 2Q25**, down from **$1,017 million in 1Q25**[62](index=62&type=chunk) - Total nonaccrual portfolio loans and leases declined to **$853 million in 2Q25**, down from **$966 million in 1Q25**[62](index=62&type=chunk) - The Allowance for Credit Losses (ACL) increased to **$2,558 million**, with ACL as a percent of nonperforming portfolio loans and leases at **300%**[62](index=62&type=chunk) [Non-GAAP Reconciliation](index=36&type=section&id=Non-GAAP%20Reconciliation) This section provides reconciliations of various non-GAAP financial measures to their most directly comparable GAAP measures. Management uses these non-GAAP measures, such as FTE basis adjustments, tangible common equity, and adjusted metrics, to evaluate operating performance and enhance comparability, while cautioning that they should not substitute GAAP analysis - Management uses non-GAAP measures like FTE, tangible common equity, and adjusted metrics to evaluate operating performance and make day-to-day operating decisions, believing they provide useful information to investors[64](index=64&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk) - Non-GAAP measures should not be considered in isolation or relied upon as a substitute for analysis using GAAP measures[70](index=70&type=chunk) Key Non-GAAP Reconciliations (2Q25 vs. 1Q25 vs. 2Q24) | $ and shares in millions | June 2025 | March 2025 | June 2024 | | :----------------------- | :-------- | :--------- | :-------- | | Net interest income (FTE) (a) | 1,500 | 1,442 | 1,393 | | Tangible net income available to common shareholders (h) | 596 | 484 | 568 | | Average tangible common equity, including AOCI (j) | 13,557 | 12,880 | 11,562 | | Tangible common equity, excluding AOCI (m) | 17,561 | 17,182 | 16,986 | | Tangible book value per share (including AOCI) (l) | $20.98 | $19.92 | $17.75 | | Adjusted return on average tangible common equity, excluding AOCI (ac) | 13.9 % | 11.7 % | 14.4 % | | Adjusted return on average assets (z) | 1.22 % | 1.02 % | 1.21 % | | Adjusted efficiency ratio (aa) | 55.5 % | 60.5 % | 56.8 % | [Segment Presentation](index=39&type=section&id=Segment%20Presentation) The segment presentation provides financial results by business segment: Commercial Banking, Consumer and Small Business Banking, Wealth and Asset Management, and General Corporate and Other. It reflects a realignment of certain business banking customer relationships from Commercial Banking to Consumer and Small Business Banking in Q1 2025, with prior periods adjusted for comparability Income (loss) before income taxes (FTE) by Segment (2Q25 vs. 1Q25 vs. 2Q24) | $ in millions | Commercial Banking | Consumer and Small Business Banking | Wealth and Asset Management | General Corporate and Other | Total | | :------------ | :----------------- | :---------------------------------- | :-------------------------- | :-------------------------- | :---- | | **For the three months ended June 30, 2025** | | | | | | | (a) Income (loss) before income taxes (FTE) | $384 | $648 | $65 | $(284) | $813 | | **For the three months ended March 31, 2025** | | | | | | | (a) Income (loss) before income taxes (FTE) | $262 | $522 | $52 | $(178) | $658 | | **For the three months ended June 30, 2024** | | | | | | | (a) Income (loss) before income taxes (FTE) | $372 | $648 | $59 | $(309) | $770 | - During the first quarter of 2025, the Bancorp realigned its reporting structure, moving certain business banking customer relationships and relationship management personnel to the Consumer and Small Business Banking segment from the Commercial Banking segment. Prior period results have been adjusted to reflect current presentation[75](index=75&type=chunk)