Lower Fee Income, High Expenses to Hurt Fifth Third's Q1 Earnings

Core Viewpoint - Fifth Third Bancorp (FITB) is expected to report first-quarter 2025 results on April 17, with anticipated revenue growth but a decline in earnings year-over-year [1][14]. Group 1: Earnings and Revenue Expectations - The Zacks Consensus Estimate for FITB's first-quarter earnings is 70 cents per share, reflecting a 7.9% decrease from the previous year [14]. - The consensus estimate for revenues is $2.14 billion, indicating a 1.8% increase compared to the year-ago figure [14]. - The company has a history of earnings surprises, beating estimates in the last four quarters with an average surprise of 4.13% [2]. Group 2: Net Interest Income and Loan Performance - The adjusted net interest income (NII) is expected to align with the $1.44 billion reported in the fourth quarter of 2024, with a marginal sequential rise anticipated [4]. - Total average loans and leases are projected to increase by 2% from the fourth quarter, estimated at $120.9 billion, supporting average interest-earning assets [5]. Group 3: Non-Interest Revenues and Market Conditions - Non-interest revenues are expected to decline by 7-8% compared to the previous quarter, with the Zacks Consensus Estimate for non-interest income at $708.9 million, a 3.2% drop from the prior quarter [9][10]. - The commercial banking revenues are estimated at $103.9 million, reflecting a 4.7% sequential decline due to decreased M&A activity amid market uncertainties [7][6]. Group 4: Expenses and Asset Quality - Total expenses are anticipated to rise by 9.1% sequentially to $1.4 billion, driven by investments in technology and marketing [10]. - The Zacks Consensus Estimate for non-performing assets is $870.1 million, indicating a 1.2% increase from the prior quarter [12].