Core Insights - Truist Securities is enhancing its business across key sectors to provide innovative advice and solutions to clients [1] - The industrial sector is undergoing significant changes, and the experience of new managing directors will be crucial for clients to navigate these complexities and seize new opportunities [2] Company Overview - Truist Securities is the corporate and investment banking arm of Truist Financial Corporation, with over 125 years of history [3] - The firm offers a wide range of services including strategic advisory, mergers and acquisitions, capital markets capabilities, corporate finance, asset finance, risk management, liquidity, and treasury management [3] New Appointments - Don Devendorf joins as managing director for the Transportation and Logistics sector, bringing experience from Morgan Stanley and Bluejay Advisors [5] - Douglas Jarl joins as managing director for the Aerospace, Defense, and Government Services sector, previously with Barclays, Bank of America, and TD Cowen [5] - Josh Prangley joins as managing director for the Building Products and Basic Materials sector, with a background at Greenhill & Co. and J.P. Morgan [5]

Group 1 - Truist (NYSE: TFC) shares have experienced a significant decline, losing over 25% from their highs and erasing all gains from the past year [1] - The stock currently offers a dividend yield of 5.8% and trades at a sub-10x valuation [1] - The analysis is based on over fifteen years of experience in making contrarian bets and identifying stock-specific turnaround stories for favorable risk/reward profiles [1]

Core Viewpoint - The financial services companies reported positive results despite economic uncertainties, highlighting customer resilience and strong balance sheets [1][12]. Group 1: Deposit Growth and Credit Quality - Deposit bases expanded or remained stable in a competitive rate environment, with KeyCorp showing mid-single-digit growth year over year and Truist increasing balances while reducing deposit costs by 10 basis points [2] - Credit quality remained robust, with KeyCorp's nonperforming assets decreasing nearly 10% from the prior quarter and Truist's provision for credit losses declining sequentially [3] Group 2: Consumer Spending Trends - American Express reported a 6% year-over-year increase in card member spending, with significant growth among Gen Z and millennials, indicating a focus on experiences [4] - Truist's mobile app saw a 31% increase in consumer loans, with Gen Z volumes rising by 47%, reflecting strong demand among younger consumers [5] Group 3: Investment and Capital Plans - Management teams are pursuing capital plans despite macroeconomic uncertainties, with Truist launching real-time payments and achieving double-digit growth in treasury-management revenue [7] - KeyCorp is actively reviewing clients for tariff exposure while maintaining existing capital expenditure projects, and Fifth Third is investing in Southeast branches and national loan-origination platforms [8] Group 4: Contingency Planning - Each institution has contingency plans in place, with KeyCorp setting aside an additional $8 million in loan-loss reserves and Truist trimming certain expenses while continuing to invest in risk management and digital initiatives [9][10] - The common strategy includes maintaining liquidity, tight credit underwriting, and targeted technology investments to either cut costs or expand fee income [10] Group 5: Market Confidence and Preparedness - Confidence among these institutions is bolstered by low unemployment and stable delinquency metrics, alongside a shift towards higher-quality borrowers and fee-based products [11] - American Express noted that 70% of new accounts carry annual fees, while KeyCorp and Truist emphasized the growth of wealth management and treasury businesses [12] Group 6: Overall Sentiment - Despite acknowledging geopolitical and policy risks, the companies expressed optimism about their preparedness and ability to navigate economic uncertainties [12][13]

Group 1 - The article emphasizes a dividend-focused value investment strategy that prioritizes capital preservation and steady income growth [1] - The investment approach involves holding high-quality value stocks that provide meaningful growth and long-term safety [1] Group 2 - The author has disclosed a long position in the shares of TFC and USB, indicating a personal investment interest in these companies [2] - The article is presented as a personal opinion and does not constitute professional investment or tax advice [3]

Core Viewpoint - Truist Financial reported better-than-expected earnings for the first quarter of 2025, with adjusted earnings of 87 cents per share, beating estimates by a penny, although this represents a 3.3% decline year over year [1] Financial Performance - The company's total quarterly revenues reached $4.90 billion, a 1.7% increase year over year, but fell short of the Zacks Consensus Estimate of $4.92 billion [4] - Net interest income (NII) rose 3.8% to $3.56 billion, driven by balance sheet repositioning, although it slightly missed the estimate of $3.57 billion [4] - Non-interest income decreased by 3.7% to $1.40 billion, primarily due to declines in most components except for service charges on deposits and mortgage banking income [5] - Non-interest expenses were $2.91 billion, down 1.6%, attributed to lower personnel and regulatory costs, while adjusted non-interest expenses rose 1.5% to $2.87 billion [6] Credit Quality - Net charge-offs were 0.60% of average loans and leases, a decrease of 4 basis points, while provisions for credit losses were $458 million, down 8.4% from the previous year [8] - Total non-performing assets (NPAs) increased by 9.6% to $1.62 billion, exceeding expectations [9] Profitability and Capital Ratios - The return on average common equity was 8.1%, down from 8.4% in the prior year [10] - The Tier 1 risk-based capital ratio improved to 12.7% from 11.7% year over year, and the common equity Tier 1 ratio rose to 11.3% from 10.1% [10] Share Repurchase Activity - During the reported quarter, Truist Financial repurchased shares worth $500 million [11] Outlook - The company anticipates that decent loan demand, business restructuring initiatives, and efforts to bolster fee income will support its top line, despite challenges from elevated expenses and weak asset quality [12]

Earnings Conference Call Bill Rogers – Chairman & CEO First Quarter 2025 Earnings Conference Call Mike Maguire – CFO Bill Rogers - Chairman & CEO Mike Maguire - CFO April 17, 2025 April 17, 2025 Fourth Quarter 2024 Forward-Looking Statements From time to time we have made, and in the future will make, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current f ...

Core Viewpoint - Truist Financial Corporation reported quarterly earnings of $0.87 per share, exceeding the Zacks Consensus Estimate of $0.86 per share, but down from $0.90 per share a year ago, indicating a slight decline in year-over-year performance [1][2] Financial Performance - The company posted revenues of $4.9 billion for the quarter ended March 2025, which missed the Zacks Consensus Estimate by 0.50%, but showed an increase from $4.82 billion in the same quarter last year [2] - Over the last four quarters, Truist Financial has surpassed consensus EPS estimates four times and topped consensus revenue estimates three times [2] Stock Performance - Truist Financial shares have declined approximately 17% since the beginning of the year, compared to a decline of 10.3% for the S&P 500 [3] - The current Zacks Rank for Truist Financial is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.96 on revenues of $5.06 billion, and for the current fiscal year, it is $3.94 on revenues of $20.46 billion [7] - The trend of estimate revisions for Truist Financial is mixed, which could change following the recent earnings report [6] Industry Context - The Banks - Major Regional industry, to which Truist Financial belongs, is currently ranked in the top 36% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Financial Data and Key Metrics Changes - The company reported net income available to common shareholders of $1.2 billion, or 87 cents per share, with a decrease in total revenue of 3.2% linked quarter due to declines in both net interest income and non-interest income [14][28][29] - Adjusted expenses decreased by 5.4% linked quarter, contributing to a 130 basis point improvement in the efficiency ratio [29][38] - The CET1 ratio declined 20 basis points to 11.3% due to dividend payments and share buybacks, while the CET1 capital ratio including AOCI declined to 9.6% [42] Business Line Data and Key Metrics Changes - In consumer and small business banking, average loans increased by 1.3% linked quarter, driven by growth in residential mortgage and indirect auto loans [17][30] - Wholesale banking saw a 1% growth in average loans, with strong performance in payments and wealth management [21][23] - Investment banking and capital markets activity slowed, leading to a flat year-over-year revenue outlook for these segments [9][22] Market Data and Key Metrics Changes - Average deposits increased by $2.2 billion sequentially, or 0.6%, with end-of-period deposits rising by 3.4% [32] - The company managed to decrease total deposit costs by 10 basis points sequentially to 1.79% [33] - Non-interest income decreased by 5.3% linked quarter, primarily due to lower investment banking and trading income [37] Company Strategy and Development Direction - The company is focused on five strategic priorities: deepening client relationships, maintaining expense discipline, investing in talent and technology, ensuring strong asset quality, and leveraging capital advantages for growth and shareholder returns [10][13][50] - Investments in technology include a new AI tool, Truist Client Pulse, aimed at enhancing client experience [12] - The company aims to capture additional market share in areas like premier banking, middle market banking, payments, and wealth management [10][20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged increased market volatility and economic uncertainty, leading to a reduction in revenue outlook for investment banking and trading [9][44] - Despite challenges, management expressed confidence in the company's strong foundation and ability to navigate the current environment [51][52] - The company expects net interest income to increase by approximately 3% in 2025, driven by low single-digit loan growth and interest rate reductions [45][46] Other Important Information - The company plans to target up to $750 million in share buybacks during the second quarter of 2025 [49] - The company reported stable asset quality metrics, with net charge-offs increasing slightly but remaining within a narrow band [40][41] Q&A Session Summary Question: Regarding the increased buyback in the second quarter - Management indicated that the strong capital position allows for opportunistic buybacks while supporting growth and weathering potential storms [58][60] Question: On deposit costs and mix - Management expressed confidence in controlling deposit costs and maintaining a stable mix, with ongoing efforts to manage the consumer side effectively [62][64][66] Question: Loan growth demand and pipeline - Management reported strong commitments and pipelines, with production up across various sectors, indicating continued loan growth despite market uncertainties [74][75] Question: Investment banking and capital markets outlook - Management noted that while pipelines are strong, many clients are postponing transactions, leading to a flat forecast for investment banking [82][84] Question: Changes in lending standards - Management confirmed that lending standards remain consistent, focusing on adding new clients and expanding existing relationships [127][128] Question: Cost-saving initiatives and restructuring charges - Management discussed ongoing efforts to improve efficiency and reduce costs, with minimal restructuring charges expected for the remainder of the year [135][139]

Financial Performance - Interest income for Q1 2025 was $6,036 million, a decrease of 3.1% from $6,230 million in Q4 2024[4] - Net interest income after provision for credit losses was $3,049 million, down from $3,119 million in the previous quarter, reflecting a decline of 2.2%[4] - Noninterest income for the quarter was $1,392 million, a decrease of 5.3% compared to $1,470 million in Q4 2024[4] - Net income available to common shareholders for Q1 2025 was $1,157 million, a decrease of 4.8% from $1,216 million in Q4 2024[4] - Earnings per share (diluted) from continuing operations was $0.87, down from $0.92 in the previous quarter, representing a decline of 5.4%[4] - The company reported an income before income taxes of $1,535 million for Q1 2025, compared to $1,554 million in Q4 2024, reflecting a decrease of 1.2%[6] - The net income from continuing operations for the quarter was $1,261 million, compared to $1,289 million in the previous quarter[15] Asset and Liability Management - Total assets at the end of Q1 2025 were $535,899 million, an increase from $531,176 million at the end of Q4 2024[4] - Total assets increased to $535.899 billion as of March 31, 2025, up from $531.176 billion at December 31, 2024, representing a growth of 0.5%[7] - Total liabilities stood at $471.264 billion, a slight increase from $467.497 billion, indicating a growth of 0.4%[7] - Shareholders' equity increased to $64.635 billion, compared to $63.679 billion at the end of the previous quarter, reflecting a growth of 1.5%[7] - The allowance for loan and lease losses remained stable at $4.870 billion, slightly up from $4.857 billion in the previous quarter[7] Income and Expense Analysis - Total noninterest expense for Q1 2025 was $2,906 million, a decrease of 4.3% compared to $3,035 million in Q4 2024[6] - Total noninterest expense decreased to $2,906 million in Q1 2025 from $3,035 million in Q4 2024, indicating improved cost management[15] Credit Quality and Losses - Provision for credit losses was $458 million in Q1 2025, slightly down from $471 million in Q4 2024[6] - Nonperforming assets rose to $1.618 billion, representing 0.30% of total assets[11] - Nonaccrual loans and leases held for investment totaled $1.488 billion, up from $1.429 billion[11] - The net charge-offs as a percentage of average loans and leases stood at 0.60%, indicating a slight increase[11] - Net charge-offs for the quarter were $454 million, compared to $453 million in the previous quarter, reflecting a slight increase[13] Capital and Ratios - Common equity tier 1 ratio was 11.3%, slightly down from 11.5% in the previous quarter[4] - Total risk-based capital ratio is 14.7% for the quarter ended March 31, 2025, down from 15.0% in the previous quarter[17] - Tangible common equity per common share increased to $30.95 as of March 31, 2025, compared to $30.01 at the end of December 2024[17] Deposits and Loans - Total deposits rose to $403.736 billion, compared to $390.524 billion at the end of the previous quarter, marking an increase of 3.1%[7] - Total loans and leases held for investment reached $308.638 billion, a slight increase from $306.383 billion in the previous quarter, reflecting a growth of 0.4%[7] - Interest on deposits for Q1 2025 was $1,736 million, a decrease of 6.4% from $1,855 million in Q4 2024[6] Mortgage Banking - Total mortgage banking income for the first quarter of 2025 is $108 million, a decrease of 7.7% from $117 million in the fourth quarter of 2024[19] - Residential mortgage loan originations for the first quarter of 2025 are $3,626 million, down 23.6% from $4,745 million in the previous quarter[19] - The total servicing portfolio as of March 31, 2025, is $271,268 million, a decrease from $273,412 million at the end of the previous quarter[19] Operational Efficiency - The efficiency ratio (adjusted) for Q1 2025 was 56.4%, an improvement from 57.7% in the previous quarter[4] - The liquidity coverage ratio improved to 111% in Q1 2025, compared to 109% in Q4 2024[4]

CHARLOTTE, N.C., April 17, 2025 /PRNewswire/ -- Truist Financial Corporation (NYSE: TFC) reported its first quarter 2025 results today. Investors can access the live first quarter 2025 earnings call at 8 a.m. ET today by webcast or dial-in as follows: Webcast: app.webinar.net/KNd8VGQjew3 Dial-in: 1-877-883-0383, passcode 0999346The earnings release, investor presentation, including an appendix reconciling non-GAAP disclosures, and Truist's First Quarter 2025 Quarterly Performance Summary, which contains det ...