Truist(US:TFC) ZACKS·2026-01-21 19:16Core Viewpoint - Truist Financial's fourth-quarter 2025 adjusted earnings of $1.12 per share exceeded expectations, but shares fell nearly 2% in pre-market trading despite the positive results [1]. Financial Performance - Adjusted earnings per share for 2025 were $3.82, missing the Zacks Consensus Estimate of $3.92, but increased by 13.7% year over year [4]. - Total revenues for the fourth quarter were $5.25 billion, a 3.7% year-over-year increase, but fell short of the Zacks Consensus Estimate of $5.27 billion [5]. - Full-year revenues reached $20.32 billion, up 53% year over year, but also missed the Zacks Consensus Estimate of $20.38 billion [5]. - Net interest income (NII) for the quarter was $3.75 billion, a 3% increase year over year, with a net interest margin (NIM) of 3.07%, unchanged from the prior year [5]. Income and Expenses - Non-interest income was $1.55 billion, reflecting a 5.2% year-over-year increase, driven by various fee income sources [6]. - Non-interest expenses rose to $3.17 billion, up 4.4% year over year, primarily due to higher personnel and other expenses [6]. - The adjusted efficiency ratio improved to 54.9%, down from 57.7% in the prior-year quarter, indicating enhanced profitability [7]. Credit Quality - Provision for credit losses was $512 million, an 8.7% increase from the prior year, while total non-performing assets (NPAs) rose to $1.63 billion, up 10.6% year over year [8]. - Net charge-offs were 0.57% of average loans and leases, a decrease of 2 basis points from the prior year [8]. - The allowance for loan and lease losses was 1.53% of total loans, down 6 basis points year over year [9]. Capital Ratios and Share Repurchases - Return on average common equity was 8.5%, slightly up from 8.4% in the fourth quarter of 2024 [10]. - The Tier 1 risk-based capital ratio was 11.9%, down from 12.9% in the prior year, while the common equity Tier 1 ratio was 10.8%, down from 11.5% [10]. - Truist Financial repurchased shares worth $750 million during the reported quarter [11]. Outlook - The company expects decent loan demand and ongoing business restructuring initiatives to support its top line, although elevated expenses pose a significant challenge [12].