Financial Performance - The company's adjusted PPNR growth was the highest in over 2 years[8] - The reported EPS was $0.91, and the adjusted EPS was $0.93[9] - The reported ROA was 1.21%, and the adjusted ROA was 1.25%[9] - The reported ROE was 12.6%, and the adjusted ROE was 13.0%[9] - The reported ROTCE was 17.3%, and the adjusted ROTCE was 17.7%[9] Loan and Deposit Growth - Average consumer and commercial loans increased by 7% and 4% respectively compared to 3Q24[10] - Average deposits totaled $165 billion, with demand deposits accounting for 25%, interest checking 34%, money market and savings 33%, and time deposits 8%[32] - The company maintained CET1 above 10.5% while executing $300 million of share repurchases and raising the common dividend by 8%[10] Income Statement Analysis - Net interest income increased from $1.50 billion in 2Q25 to $1.525 billion in 3Q25[13] - Capital market fees increased by 28% quarter-over-quarter due to a strong rebound in loan syndications and M&A advisory revenue[14] - Wealth and asset management revenue increased by 11% year-over-year[15] - Mortgage banking net revenue increased by 16% year-over-year[15] - The adjusted efficiency ratio improved by 180 bps compared to 3Q24, reaching 54.1%[22] Credit Quality - The NCO ratio increased to 1.09%[36] - The ACL ratio as a % of portfolio loans and leases was 1.96%[36] Outlook - The company expects average loans & leases to be up 1% in 4Q25 compared to 3Q25[57] - The company expects noninterest income to be up 2-3% in 4Q25 compared to 3Q25[57]

Summary of Fifth Third Bancorp and Comerica Merger Conference Call Company and Industry - **Companies Involved**: Fifth Third Bancorp (NasdaqGS:FITB) and Comerica - **Industry**: Banking and Financial Services Core Points and Arguments 1. **Merger Announcement**: Fifth Third Bancorp announced the merger with Comerica, aiming to create a more dynamic and resilient bank [3][4] 2. **M&A Framework**: The merger is viewed as a strategic move rather than a standalone strategy, focusing on achieving specific objectives and ensuring that the combined entity is better, not just larger [4][6] 3. **Financial Metrics**: - No tangible book value per share dilution, with projected tangible book value per share accretion of 5% on day one [4][12] - Projected EPS accretion of 9% and an internal rate of return (IRR) of 22% [4][13] - Identified cost savings valued at $6.5 billion [4][5] 4. **Operational Synergies**: The merger is expected to enhance stability, profitability, and growth, with a diversified balance sheet and revenue profile [5][6] 5. **Market Positioning**: The combined company will have a strong presence in 17 of the 20 fastest-growing large U.S. metro areas, with plans to open 150 new financial centers in Texas by 2029 [6][8] 6. **Wealth Management**: The combined wealth and asset management platform will manage over $750 billion in assets, making it one of the largest among regional banks [9][10] 7. **Cultural Fit**: Strong cultural alignment is emphasized, with key leaders from both organizations expected to play significant roles post-merger [10][11] Additional Important Content 1. **Transaction Details**: Comerica shareholders will receive 1.8663 shares of Fifth Third for each Comerica share, equating to a purchase price of $82.88, representing a 20% premium [12][13] 2. **Cost Savings and Charges**: Projected cost savings of 35% of Comerica's projected 2026 non-interest expense, with one-time charges estimated at $950 million [13][14] 3. **Balance Sheet Management**: The transaction is expected to provide flexibility in managing potential market volatility, with a focus on maintaining a balanced position [50][52] 4. **Retail Banking Strategy**: The merger aims to enhance retail banking capabilities, particularly in underpenetrated markets like Texas and California, with a focus on building out the retail network [30][34] 5. **Integration Lessons**: Insights from the previous merger with MB Financial are being applied to ensure a smooth integration process, focusing on retaining key talent and managing systems conversion effectively [42][46] 6. **Long-term Growth Potential**: The merger is expected to unlock growth opportunities in commercial banking and enhance the overall market position of the combined entity [78][82] This summary encapsulates the key points discussed during the conference call regarding the merger between Fifth Third Bancorp and Comerica, highlighting the strategic rationale, financial implications, and operational synergies anticipated from the transaction.

Financial Data and Key Metrics Changes - The company reported earnings per share of 71 cents, or 73 cents excluding certain items, exceeding consensus estimates [7] - Pre-provision net revenue (PPNR) grew by 5% year-over-year, with an adjusted return on equity of 11.2% [7] - Tangible book value per share increased by 15% over the prior year, despite the 10-year treasury rate remaining unchanged [8] - Net interest income (NII) grew by 4% year-over-year, with net interest margins expanding for the fifth consecutive quarter [10] Business Line Data and Key Metrics Changes - Total loans grew by 3% year-over-year, driven by strong middle market commercial and industrial (C&I) production and balanced growth across consumer-secured lending categories [9] - Commercial payments revenue increased by 6%, while wealth and asset management revenue grew by 7%, supported by a 10% growth in assets under management (AUM) [10] - Adjusted non-interest income increased by 1% compared to the prior year, driven by growth in wealth and commercial payments [30] Market Data and Key Metrics Changes - Core deposits remained stable, with total household growth of 2% and 5% growth in the southeast [9] - Average core deposits decreased by 2% sequentially, primarily due to normal seasonality and commercial factors [26] - The loan-to-core deposit ratio was 75%, up 2% from the prior quarter [28] Company Strategy and Development Direction - The company aims to achieve record NII within existing guidance, even without rate cuts or further loan growth [16] - Focus on maintaining a resilient business mix and managing the balance sheet defensively to react quickly to changing conditions [12] - Continued investments in southeast branches and growth in commercial payments are expected to enhance operational deposit funding [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering stability, profitability, and growth amid uncertain economic conditions [7] - The company anticipates inflation to rise and growth to slow down, but expects unemployment to remain stable [63] - Management highlighted the importance of maintaining a strong liquidity profile and managing funding costs prudently [28] Other Important Information - The company has a high allowance for credit losses (ACL) coverage ratio of 2.07%, among the highest in its peer group [38] - The CET1 ratio was maintained at 10.5%, exceeding the buffered minimum of 7.7% [39] - The company plans to repurchase $400 million to $500 million of stock during the remainder of 2025, depending on realized loan growth [50] Q&A Session Summary Question: Can you share insights on interactions with commercial customers amid economic uncertainty? - Management noted that clients are generally nervous about tariffs and are planning to push prices to cover costs, with no indications of layoffs among clients [56][62] Question: What areas aside from credit is the company focusing on to navigate a potential slowdown? - Management emphasized the importance of deposit funding and disciplined expense management as key focus areas [68][69] Question: Can you provide details on the increase in non-performing loans (NPLs)? - The increase was primarily due to two ABL loans, but management expressed confidence in the overall health of the portfolio and does not foresee significant increases in NPLs [75][80] Question: How is the company managing costs without impairing growth plans? - Management indicated that cost reductions would come from variable compensation linked to revenue production and disciplined spending on operational activities [95] Question: What is the outlook for the U.S. consumer and associated risks? - Management highlighted that lower-income consumers are under stress, while higher-income individuals are likely to reduce spending, but the middle-income segment remains stable as long as unemployment does not rise significantly [125][132]

Fifth Third Bancorp 1Q25 Earnings Presentation April 17, 2025 Refer to earnings release dated April 17, 2025 for further information. © Fifth Third Bancorp | All Rights Reserved Cautionary statement This presentation contains statements that we believe are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6 promulgated thereunder. All st ...