Truist(US:TFC)2025-10-17 13:00Financial Data and Key Metrics Changes - The company reported net income available to common shareholders of $1.3 billion, or $1.04 per share, which included $0.02 per share of restructuring charges primarily related to severance [4][12] - Adjusted revenue increased by 3.7% late in the quarter, driven by a 9.9% growth in non-interest income and a 1.2% growth in net interest income [12][22] - Average loan balances increased by 2.5%, while average deposit balances decreased by $3.9 billion sequentially, or 1% [5][14] - The company returned $1.2 billion of capital to shareholders through dividends and stock repurchases, with plans to target approximately $750 million in share repurchases during the fourth quarter [7][22] Business Line Data and Key Metrics Changes - Consumer and small business banking saw net new checking account growth with over 20,000 new accounts added, and average loan balances increased by 2% late in the quarter [9][10] - Wholesale loans increased by 2.8% late in the quarter, driven by growth from new and existing clients [10][11] - Wealth management income increased by 7.5% late in the quarter due to higher market values and positive net asset flows [18] Market Data and Key Metrics Changes - Digital transactions rose by 7% year over year, with digital channels accounting for 40% of new clients, particularly among Gen Z and Millennials [10] - The company experienced broad-based growth across industry banking verticals, with significant increases in loan and deposit production per banker [11] Company Strategy and Development Direction - The company announced a strategic investment to build 100 new branches in high-growth markets and enhance digital capabilities [3][4] - The focus remains on deepening relationships with existing clients and attracting new clients through technology-enabled experiences [4][26] - The company aims to achieve a 15% ROTCE by 2027, reflecting confidence in long-term earnings power and strategic direction [24][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to reach a 15% ROTCE by 2027, with expectations for revenue growth in 2026 to more than double compared to 2025 [24][26] - The company anticipates continued loan growth and improved client deposit growth in the fourth quarter and into 2026 [14][22] Other Important Information - The company maintained strong asset quality metrics, with net charge-offs declining both on a late quarter and year-over-year basis [7][19] - The CET1 capital ratio remained stable at 11%, with an improved CET1 ratio including AOCI at 9.4% [12] Q&A Session Summary Question: Revenue growth expectations for 2026 - Management indicated that revenue growth is expected to more than double in 2026 compared to 2025, with both net interest income and fee income contributing to this growth [32][34] Question: Deposit pricing outlook with Fed rate cuts - Management expressed optimism about deposit pricing and growth momentum, anticipating improvements in interest-bearing deposit beta due to recent Fed rate cuts [38][40] Question: Credit quality perspective - Management stated that overall credit quality remains strong, with a focus on high-quality assets in both wholesale and consumer spaces [70][73] Question: Capital levels and buyback flexibility - Management confirmed flexibility in buybacks, with a target of $750 million for the fourth quarter, while maintaining a conservative capital structure [78] Question: Non-accrual loans and First Brands exposure - Management acknowledged that the increase in non-accrual loans includes exposure to First Brands, which has been accounted for in the forward guidance [87][90]