TFC 8-K
Truist Financial Corp (TFC)
8-K
2022-07-19
For: 2022-07-19
View Original
Added on
April 05, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________________
Form 8-K
Current Report
_____________________________________________
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
(Exact name of registrant as specified in its charter)
_____________________________________________
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||
(Address of principal executive offices) | (Zip Code) | |||||||
(336 ) 733-2000
(Registrant’s telephone number, including area code)
_____________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
ITEM 2.02 Results of Operations and Financial Condition.
On July 19, 2022, Truist Financial Corporation (“Truist”) issued a press release reporting second quarter 2022 results and posted on its website its second quarter 2022 Earnings Release, Quarterly Performance Summary, and Earnings Release Presentation. The materials contain forward-looking statements regarding Truist and include cautionary language identifying important factors that could cause actual results to differ materially from those anticipated. The Earnings Release, Quarterly Performance Summary, and Earnings Release Presentation are furnished as Exhibits 99.1, 99.2, and 99.3, respectively. Consequently, they are not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section. Such materials may only be incorporated by reference into another filing under the Exchange Act or Securities Act of 1933 if such subsequent filing specifically references this Form 8-K. All information in the Earnings Release, Quarterly Performance Summary, and Earnings Release Presentation speaks as of the date thereof, and Truist does not assume any obligation to update such information in the future.
ITEM 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description of Exhibit | |||||||
| Earnings Release issued July 19, 2022. | ||||||||
| Quarterly Performance Summary issued July 19, 2022. | ||||||||
| Earnings Release Presentation issued July 19, 2022. | ||||||||
| 104 | The cover page from this Current Report on Form 8-K, formatted in Inline XBRL. | |||||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
TRUIST FINANCIAL CORPORATION | ||||||||
(Registrant) | ||||||||
| By: | /s/ Cynthia B. Powell | |||||||
Cynthia B. Powell | ||||||||
Executive Vice President and Corporate Controller | ||||||||
(Principal Accounting Officer) | ||||||||
Date: July 19, 2022
`
 | News Release | |||||||
| Contact: | ||||||||
| Investors: | Ankur Vyas 404.827.6714 | [email protected] | |||||||
| Media: | Shelley Miller 704.692.1518 | [email protected] | |||||||
Truist reports second quarter 2022 results
Second quarter 2022 GAAP earnings of $1.5 billion, or $1.09 per diluted share
Second quarter 2022 Adjusted earnings of $1.6 billion, or $1.20 per diluted share
Results reflect strong loan growth and expanded NIM given higher rates and strong deposit franchise
Fee revenues include record insurance and card and payment related fees, tempered by market volatility
Capital, liquidity, and credit quality remain strengths
CHARLOTTE, N.C., (July 19, 2022) — Truist Financial Corporation (NYSE: TFC) today reported earnings for the second quarter of 2022.
Net income available to common shareholders of $1.5 billion was down 6.7% from the second quarter of last year, primarily due to a benefit in the provision for credit losses last year. Earnings per diluted common share were $1.09, a decrease of 6.0% compared with the same period last year. Results for the second quarter produced an annualized return on average assets (ROA) of 1.14%, an annualized return on average common shareholders’ equity (ROCE) of 10.3%, and an annualized return on tangible common shareholders’ equity (ROTCE) of 22.7%.
Adjusted net income available to common shareholders was $1.6 billion, or $1.20 per diluted share, excluding merger-related and restructuring charges of $121 million ($92 million after-tax), incremental operating expenses related to the merger of $117 million ($89 million after-tax), and a gain on the redemption of FHLB advances of $39 million ($30 million after-tax). Adjusted results produced an annualized ROA of 1.25%, an annualized ROCE of 11.3%, and an annualized ROTCE of 24.8%.
“Truist demonstrated much progress this quarter for our stakeholders. Our solid second-quarter performance reflects our improved momentum post-integration and the resiliency of our diverse business mix in a volatile market environment,” said Chairman and CEO Bill Rogers. “Our results include adjusted net income of $1.6 billion and a strong adjusted return on average tangible common equity of 25%. Loan growth was broad-based and we delivered significant expansion of our net interest margin as a result of higher interest rates and our strong deposit franchise. Credit quality remained excellent in the second quarter, also evidenced by our performance during the latest stress test, with Truist having the second-lowest loan loss rate among our peers under the severely adverse stress scenario. Following our stress test results we announced a strong 8% increase in our quarterly cash dividend, subject to approval by the board of directors at our July meeting.
“Guided by our purpose to inspire and build better lives and communities, we’re investing in key talent by increasing our minimum wage to $22 effective October 1, 2022. We’ve also committed $120 million to help historically underserved small businesses gain access to capital and technical assistance. Our recent 2021 Environmental, Social, and Governance and Corporate Social Responsibility report highlights the significant steps we’ve taken to meet and exceed our goals, including the diversity of our senior leadership and supporting our clients and communities to transition to a lower carbon economy.
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“While certain residual integration activities remain, we’re seeing the early benefits of our shift from integrating to operating and continue to make strategic investments in talent and technology to accelerate our growth. We’re confident Truist is well-positioned to perform in any environment given our diverse business mix and strong capital position. We remain committed to delivering positive operating leverage on both a GAAP and adjusted basis for full-year 2022.”
Second Quarter 2022 Performance Highlights
•Earnings per diluted common share for the second quarter of 2022 were $1.09
◦Adjusted diluted earnings per share were $1.20 down $0.03 per share, or 2.4%, compared to first quarter 2022 and $0.35 per share, or 23%, compared to second quarter 2021
▪Declines were impacted by a higher provision cost compared to prior periods
◦ROA was 1.14%; adjusted ROA was 1.25%
◦ROCE was 10.3%; adjusted ROCE was 11.3%
◦ROTCE was 22.7%; adjusted ROTCE was 24.8%
•PPNR for the second quarter of 2022 was $2.1 billion, up 25% compared to first quarter 2022 and 26% compared to second quarter 2021
◦Adjusted PPNR was up 10% compared to first quarter 2022 and down 2.0% compared to second quarter 2021
◦GAAP operating leverage was 870 basis points compared to the first quarter of 2022 and 350 basis points year-to-date 2022 compared to 2021
◦Adjusted operating leverage was 250 basis points compared to the first quarter of 2022 and (200) basis points year-to-date 2022 compared to 2021
•Taxable-equivalent revenue for the second quarter of 2022 was $5.7 billion, up 6.2% compared to first quarter 2022 and relatively flat compared to second quarter 2021
◦Taxable-equivalent net interest income was up 7.0% compared to first quarter 2022 and up 4.9% compared to second quarter 2021
▪The increase compared to first quarter 2022 was primarily due to higher market interest rates coupled with well controlled deposit costs, loan growth, and one additional day
◦Noninterest income was up 4.9% compared to first quarter 2022 and down 6.5% compared to second quarter 2021
▪Record insurance income due to continued organic growth, acquisitions and seasonality
▪Record card and payment related fees due to increased activity and prior quarter acquisition of certain merchant services relationships
▪Investment banking revenues were lower compared to last year due to volatile market conditions
▪Residential mortgage income declined due to lower margins and refinance volumes resulting from the higher rate environment
◦Net interest margin was 2.89%, up 13 basis points from first quarter 2022
▪Core net interest margin was 2.72%, up 15 basis points from first quarter 2022, driven by higher market interest rates coupled with well controlled deposit costs and positive earning asset mix shift
•Noninterest expense for the second quarter of 2022 was $3.6 billion, down 2.6% compared to first quarter 2022 and down 10.7% compared to second quarter 2021
◦Adjusted noninterest expense was $3.2 billion, up $119 million, or 3.8%, compared to first quarter 2022 due to higher personnel expenses, operational losses and professional fees
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◦Adjusted noninterest expenses increased $56 million, or 1.8%, compared to second quarter 2021 primarily due to higher operational losses, professional fees and marketing costs, partially offset by lower personnel expense
◦GAAP efficiency ratio was 63.3%, compared to 69.0% for first quarter 2022
◦Adjusted efficiency ratio was 57.0%, compared to 58.3% for first quarter 2022
•Broad-based loan growth; end of period loans held for investment grew 4.7% compared to the first quarter of 2022
◦Average loans and leases held for investment for the second quarter of 2022 were $296.7 billion, up $8.1 billion, or 2.8%, compared to the first quarter of 2022
▪Average commercial loans were up $5.8 billion, or 3.5%, driven by broad based growth within the commercial and industrial portfolio
▪Average consumer loans were up $2.2 billion, or 1.9%, across all portfolios except student lending
•Asset quality remains excellent, reflecting Truist’s prudent risk culture and diverse portfolio
◦Net charge-offs were 0.22% of average loans and leases, down three basis points compared to first quarter 2022
◦The ALLL ratio was 1.38% compared to 1.44% for first quarter 2022
▪The ALLL coverage ratio was 6.54X annualized net charge-offs, versus 5.78X for first quarter 2022
•Capital and liquidity levels remained strong; deployed capital through organic loan growth, dividends, and share repurchases
◦Common equity tier 1 to risk-weighted assets was 9.2%
◦Repurchased $250 million of common shares
◦Announced proposed increase to common dividend of 8% for the third quarter 2022
◦Consolidated average LCR ratio was 110%
| EARNINGS HIGHLIGHTS | Change 2Q22 vs. | ||||||||||||||||
| (dollars in millions, except per share data) | 2Q22 | 1Q22 | 2Q21 | 1Q22 | 2Q21 | ||||||||||||
| Net income available to common shareholders | $ | 1,454 | $ | 1,327 | $ | 1,559 | $ | 127 | $ | (105) | |||||||
| Diluted earnings per common share | 1.09 | 0.99 | 1.16 | 0.10 | (0.07) | ||||||||||||
| Net interest income - taxable equivalent | $ | 3,435 | $ | 3,209 | $ | 3,273 | $ | 226 | $ | 162 | |||||||
| Noninterest income | 2,248 | 2,142 | 2,405 | 106 | (157) | ||||||||||||
| Total taxable-equivalent revenue | $ | 5,683 | $ | 5,351 | $ | 5,678 | $ | 332 | $ | 5 | |||||||
| Less taxable-equivalent adjustment | 28 | 26 | 28 | ||||||||||||||
| Total revenue | $ | 5,655 | $ | 5,325 | $ | 5,650 | |||||||||||
| Return on average assets | 1.14 | % | 1.07 | % | 1.28 | % | 0.07 | % | (0.14) | % | |||||||
| Return on average risk-weighted assets (current quarter is preliminary) | 1.52 | 1.46 | 1.76 | 0.06 | (0.24) | ||||||||||||
| Return on average common shareholders’ equity | 10.3 | 9.0 | 10.1 | 1.3 | 0.2 | ||||||||||||
Return on average tangible common shareholders’ equity (1) | 22.7 | 18.6 | 18.9 | 4.1 | 3.8 | ||||||||||||
| Net interest margin - taxable equivalent | 2.89 | 2.76 | 2.88 | 0.13 | 0.01 | ||||||||||||
(1)Excludes certain items as detailed in the non-GAAP reconciliations in the Quarterly Performance Summary.
Second Quarter 2022 compared to First Quarter 2022
Total taxable-equivalent revenue was $5.7 billion for the second quarter of 2022, an increase of $332 million, or 6.2%, compared to the prior quarter.
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Taxable-equivalent net interest income for the second quarter of 2022 was up $226 million, or 7.0%, compared to the prior quarter due primarily to higher market interest rates coupled with well controlled deposit costs, loan growth, and one additional day. Average earning assets increased $5.9 billion, or 1.3%, due to growth in average total loans of $7.4 billion, or 2.5%, and average other earning assets of $2.3 billion, or 12%, partially offset by a decrease in average securities $4.0 billion, or 2.6%. Average deposits increased $8.5 billion, or 2.0%, average short-term borrowings increased $2.7 billion, or 39%, while average long-term debt decreased $4.1 billion, or 12% due to redemptions and maturities.
The net interest margin was 2.89% for the second quarter, up 13 basis points compared to the prior quarter. The yield on the total loan portfolio for the second quarter was 3.91%, up 22 basis points compared to the prior quarter primarily due to higher market interest rates. The yield on the average securities portfolio for the second quarter was 1.82%, up 14 basis points compared to the prior quarter primarily due to higher yields on new investments and favorable hedge benefits. Core net interest margin was 2.72%, for the second quarter, up 15 basis points compared to the prior quarter driven primarily by higher market interest rates coupled with well controlled deposit costs and positive earning asset mix shift.
The average cost of total deposits was 0.09%, up six basis points compared to the prior quarter. The average cost of short-term borrowings was 1.26%, up 66 basis points compared to the prior quarter. The average cost of long-term debt was 1.75%, up 25 basis points compared to the prior quarter. The increase in rates on deposits and other funding sources was largely attributable to the higher rate environment.
The provision for credit losses was $171 million for the second quarter, compared to a benefit of $95 million for the prior quarter. The current quarter provision expense primarily reflects growth in the loan portfolio, partially offset by a decline in the ALLL ratio. Net charge-offs for the second quarter of 2022 totaled $159 million compared to $178 million for the prior quarter. The net charge-off ratio for the current quarter of 0.22% was down three basis points compared to first quarter 2022.
Noninterest income was $2.2 billion, an increase of $106 million, or 4.9%, compared to the prior quarter. The prior quarter included securities losses of $69 million and the gain on the redemption of a noncontrolling equity interest (other income) of $74 million related to the acquisition of certain merchant services relationships. Insurance income increased $98 million, or 13%, primarily due to increased production, seasonally higher property and casualty commissions, and acquisitions, partially offset by seasonally lower employee benefit plan commissions. Card and payment related fees increased $34 million, or 16%, due to the prior quarter acquisition of certain merchant services relationships and increased activity.
Noninterest expense was $3.6 billion for the second quarter, down $94 million, or 2.6%, compared to the prior quarter. Merger-related and restructuring charges and incremental operating expenses related to the merger decreased $95 million and $85 million, respectively, compared to first quarter 2022, given diminishing integration-related activities. The current quarter includes a $39 million gain on the redemption of FHLB advances. Excluding the aforementioned items and the amortization of intangibles, adjusted noninterest expense increased $119 million, or 3.8%, compared to the prior quarter. Personnel expense increased $51 million, or 2.5%, ($64 million on an adjusted basis) compared to first quarter 2022 due to higher incentives resulting from higher insurance revenues, higher salaries due to annual merit increases, and investments in talent for revenue producing businesses and enterprise technology, partially offset by lower payroll taxes as a result of teammates reaching limits. In addition, adjusted noninterest expense increased due to higher operational losses and teammate travel (other expense), as well as an increase for professional fees and outside processing expenses due to increased call center staffing and enterprise technology investments.
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The provision for income taxes was $372 million for the second quarter of 2022, compared to $330 million for the prior quarter. The effective tax rate for the second quarter of 2022 was 19.5%, compared to 18.9% for the prior quarter. The increase in the effective tax rate was primarily driven by an increase in income before taxes and discrete tax benefits recognized in the prior quarter.
Second Quarter 2022 compared to Second Quarter 2021
Total taxable-equivalent revenues were $5.7 billion for the second quarter of 2022, relatively flat compared to the earlier quarter.
Taxable equivalent net interest income for the second quarter of 2022 was up $162 million, or 4.9%, compared to the earlier quarter primarily due to higher market interest rates coupled with well controlled deposit costs, growth in the securities portfolio and lower premium amortization. These increases were partially offset by lower purchase accounting accretion and lower PPP revenue. Average earning assets increased $20.6 billion, or 4.5%, compared to the earlier quarter. The increase in average earning assets reflects a $13.0 billion, or 10%, increase in average securities, a $6.9 billion, or 2.4%, increase in total loans and leases, and a $1.0 billion, or 20%, increase in average interest earning trading assets. Average deposits increased $27.5 billion, or 6.9%, and average short term borrowings increased $3.5 billion, or 56%, compared to the earlier quarter, while average long-term debt decreased $5.6 billion, or 15%.
Net interest margin was 2.89%, up one basis point compared to the earlier quarter. The yield on the total loan portfolio for the second quarter of 2022 was 3.91%, down ten basis points compared to the earlier quarter, reflecting the impact of lower purchase accounting accretion, partially offset by higher market interest rates. The yield on the average securities portfolio was 1.82%, up 35 basis points compared to the earlier quarter primarily due to purchases of higher yielding securities, favorable hedge benefits, and lower premium amortization. Core net interest margin was 2.72% for the second quarter, up 12 basis points compared to the earlier quarter driven by higher market interest rates coupled with well controlled deposit costs and lower premium amortization.
The average cost of total deposits was 0.09%, up five basis points compared to the earlier quarter. The average cost of short-term borrowings was 1.26%, up 28 basis points compared to the earlier quarter. The average cost of long-term debt was 1.75%, up 15 basis points compared to the earlier quarter. The increase in rates on deposits and other funding sources was largely attributable to the higher rate environment.
The provision for credit losses was $171 million, compared to a benefit of $434 million for the earlier quarter. The earlier quarter included a reserve release due to the improving credit environment during that period. Net charge-offs for the second quarter of 2022 totaled $159 million compared to $142 million in the earlier quarter. The net charge-off ratio for the current quarter of 0.22% was up two basis points compared to the earlier quarter.
Noninterest income for the second quarter of 2022 decreased $157 million, or 6.5%, compared to the earlier quarter. Investment banking and trading income decreased $147 million, or 37%, due to lower structured real estate fees, lower high-yield bond and equity originations fees, lower loan syndications, and lower merger and acquisition fees, partially offset by higher trading income due to higher CVA gains. Other income decreased $104 million, or 87%, due to valuation changes from assets held for certain post-retirement benefits, which is primarily offset by lower personnel expense, and lower investment income from the Company’s SBIC investments. Residential mortgage income decreased $43 million, or 37%, as lower production income (due to lower margins and refinance volumes resulting from the higher rate environment) was partially offset by higher servicing income (due to lower prepayments and servicing portfolio purchases). These decreases were partially offset by a $135 million, or 20%, increase in insurance income due to continued strong organic growth and acquisitions.
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Noninterest expense for the second quarter of 2022 was down $431 million, or 11%, compared to the earlier quarter. Merger-related and restructuring charges decreased $176 million due to lower costs in connection with the voluntary separation and retirement program and lower costs associated with exiting facilities. Incremental operating expenses related to the merger decreased $73 million, primarily reflected in professional fees and outside processing expenses and personnel expense. The current quarter includes a $39 million gain on the redemption of FHLB advances. The prior quarter included $200 million of expense associated with charitable contributions to the Truist Foundation and the Truist Charitable Fund (other expense). Excluding the aforementioned items and the amortization of intangibles, adjusted noninterest expense increased $56 million, or 1.8%, compared to the earlier quarter. Personnel expense decreased $105 million, or 4.8%, ($74 million on an adjusted basis) due to lower other employee benefits as a result of the decrease in noninterest income for post-retirement benefits and lower incentives, partially offset by higher salaries due to annual merit increases and higher staffing for insurance (primarily from acquisitions) and enterprise technology. Other expense increased $73 million on an adjusted basis primarily due to increased operational losses and teammate travel expenses. Professional fees and outside processing expenses were up $42 million on an adjusted basis due to increased call center staffing and enterprise technology investments. Marketing and customer development expense was up $27 million due to increased spend to continue to build and strengthen Truist’s brand.
The provision for income taxes was $372 million for the second quarter of 2022, compared to $415 million for the earlier quarter. The effective tax rate for the second quarter of 2022 was 19.5%, compared to 20.0% for the earlier quarter. The decrease in the effective tax rate for the second quarter of 2022 was primarily driven by lower pre-tax income.
| LOANS AND LEASES | ||||||||||||||
| (dollars in millions) Average balances | 2Q22 | 1Q22 | Change | % Change | ||||||||||
| Commercial: | ||||||||||||||
| Commercial and industrial | $ | 145,558 | $ | 138,872 | $ | 6,686 | 4.8 | % | ||||||
| CRE | 22,508 | 23,555 | (1,047) | (4.4) | ||||||||||
| Commercial construction | 5,256 | 5,046 | 210 | 4.2 | ||||||||||
| Total commercial | 173,322 | 167,473 | 5,849 | 3.5 | ||||||||||
| Consumer: | ||||||||||||||
| Residential mortgage | 49,237 | 47,976 | 1,261 | 2.6 | ||||||||||
| Residential home equity and direct | 25,124 | 24,883 | 241 | 1.0 | ||||||||||
| Indirect auto | 26,496 | 26,088 | 408 | 1.6 | ||||||||||
| Indirect other | 11,471 | 10,860 | 611 | 5.6 | ||||||||||
| Student | 6,331 | 6,648 | (317) | (4.8) | ||||||||||
| Total consumer | 118,659 | 116,455 | 2,204 | 1.9 | ||||||||||
| Credit card | 4,728 | 4,682 | 46 | 1.0 | ||||||||||
| Total loans and leases held for investment | $ | 296,709 | $ | 288,610 | $ | 8,099 | 2.8 | |||||||
Average loans and leases held for investment for the second quarter of 2022 were $296.7 billion, up $8.1 billion, or 2.8%, compared to the first quarter of 2022. Excluding a $695 million decrease in average PPP loans, average loans held for investment were up $8.8 billion, or 3.1%.
Average commercial loans increased $5.8 billion, or 3.5%, due to broad-based growth of $6.7 billion, or 4.8%, within the commercial and industrial portfolio. This growth was partially offset by a $1.0 billion decrease in average CRE loans.
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Average consumer loans increased $2.2 billion, or 1.9%, due to a $1.3 billion increase in residential mortgages due to the continued strategy to hold certain correspondent channel production on the balance sheet and lower prepayments. In addition, indirect other increased $611 million primarily due to growth from the Service Finance, recreational lending and Sheffield portfolios, partially offset by runoff in other partnership lending programs. Indirect auto increased $408 million primarily in the prime segment of the portfolio and residential home equity and direct increased $241 million. These increases were partially offset by $317 million of runoff in student loans.
| DEPOSITS | ||||||||||||||
| (dollars in millions) Average balances | 2Q22 | 1Q22 | Change | % Change | ||||||||||
| Noninterest-bearing deposits | $ | 148,610 | $ | 145,933 | $ | 2,677 | 1.8 | % | ||||||
| Interest checking | 112,375 | 112,159 | 216 | 0.2 | ||||||||||
| Money market and savings | 148,632 | 141,500 | 7,132 | 5.0 | ||||||||||
| Time deposits | 14,133 | 15,646 | (1,513) | (9.7) | ||||||||||
| Total deposits | $ | 423,750 | $ | 415,238 | $ | 8,512 | 2.0 | |||||||
Average deposits for the second quarter of 2022 were $423.8 billion, an increase of $8.5 billion, or 2.0%, compared to the prior quarter. Average noninterest bearing deposits increased 1.8% compared to the prior quarter and represented 35.1% of total deposits for the second quarter of 2022, unchanged compared to the prior quarter. Average money market and savings and interest checking grew 5.0% and 0.2%, respectively, compared to the prior quarter. The increase in average money market and savings was primarily due to an increase from brokered deposits. Average time deposits decreased 9.7% primarily due to the maturity of higher-cost accounts.
| CAPITAL RATIOS | 2Q22 | 1Q22 | 4Q21 | 3Q21 | 2Q21 | ||||||||||||
| Risk-based: | (preliminary) | ||||||||||||||||
| Common equity Tier 1 | 9.2 | % | 9.4 | % | 9.6 | % | 10.1 | % | 10.2 | % | |||||||
| Tier 1 | 10.8 | 11.0 | 11.3 | 11.9 | 12.0 | ||||||||||||
| Total | 12.6 | 13.0 | 13.2 | 13.9 | 14.2 | ||||||||||||
| Leverage | 8.6 | 8.6 | 8.7 | 9.0 | 9.1 | ||||||||||||
| Supplementary leverage | 7.3 | 7.3 | 7.4 | 7.8 | 7.9 | ||||||||||||
Capital ratios remained strong compared to the regulatory requirements for well capitalized banks. Truist declared common dividends of $0.48 per share during the second quarter of 2022 and repurchased $250 million of common stock. The dividend and total payout ratios for the second quarter of 2022 were 44% and 61%, respectively.
Truist CET1 ratio was 9.2% as of June 30, 2022. The 20 basis point decline compared to the March 31, 2022 CET1 ratio primarily reflects strong loan growth and share repurchases.
Truist completed the 2022 Comprehensive Capital Analysis and Review (CCAR) process and received the preliminary stress capital buffer requirement of 2.5% for the period October 1, 2022 to September 30, 2023. By August 31, 2022, the Federal Reserve will provide Truist with its final stress capital buffer requirement. Truist also previously announced plans to increase the quarterly dividend 8% to $0.52 beginning in the third quarter of 2022. Truist’s dividends are subject to approval by its Board of Directors, and the third quarter dividend will be considered by the Truist Board at its upcoming meeting.
Truist’s average LCR was 110% for the three months ended June 30, 2022, compared to the regulatory minimum of 100%. Truist continues to maintain a strong liquidity position and is well prepared to meet the funding needs of clients.
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| ASSET QUALITY | |||||||||||||||||
| (dollars in millions) | 2Q22 | 1Q22 | 4Q21 | 3Q21 | 2Q21 | ||||||||||||
| Total nonperforming assets | $ | 1,173 | $ | 1,135 | $ | 1,163 | $ | 1,204 | $ | 1,192 | |||||||
| Total performing TDRs | 1,693 | 1,515 | 1,390 | 1,475 | 1,501 | ||||||||||||
| Total loans 90 days past due and still accruing | 1,787 | 1,914 | 1,930 | 1,872 | 2,068 | ||||||||||||
| Total loans 30-89 days past due | 2,091 | 2,101 | 2,044 | 1,823 | 1,824 | ||||||||||||
Nonperforming loans and leases as a percentage of loans and leases held for investment | 0.36 | % | 0.36 | % | 0.38 | % | 0.38 | % | 0.37 | % | |||||||
| Nonperforming loans and leases as a percentage of loans and leases, including loans held for sale | 0.37 | 0.37 | 0.38 | 0.40 | 0.39 | ||||||||||||
Nonperforming assets as a percentage of total assets | 0.22 | 0.21 | 0.21 | 0.23 | 0.23 | ||||||||||||
Loans 30-89 days past due and still accruing as a percentage of loans and leases | 0.69 | 0.72 | 0.71 | 0.64 | 0.64 | ||||||||||||
Loans 90 days or more past due and still accruing as a percentage of loans and leases | 0.59 | 0.66 | 0.67 | 0.66 | 0.72 | ||||||||||||
| Loans 90 days or more past due and still accruing as a percentage of loans and leases, excluding PPP and other government guaranteed | 0.04 | 0.04 | 0.03 | 0.03 | 0.04 | ||||||||||||
Allowance for loan and lease losses as a percentage of loans and leases held for investment | 1.38 | 1.44 | 1.53 | 1.65 | 1.79 | ||||||||||||
Net charge-offs as a percentage of average loans and leases, annualized | 0.22 | 0.25 | 0.25 | 0.19 | 0.20 | ||||||||||||
Ratio of allowance for loan and lease losses to net charge-offs, annualized | 6.54x | 5.78x | 6.14x | 8.79x | 8.98x | ||||||||||||
Ratio of allowance for loan and lease losses to nonperforming loans and leases held for investment | 3.84x | 3.99x | 4.07x | 4.35x | 4.83x | ||||||||||||
Nonperforming assets totaled $1.2 billion at June 30, 2022, up $38 million compared to March 31, 2022 due to an increase in the commercial and industrial portfolio, partially offset by a decrease in the residential mortgage portfolio. Nonperforming loans and leases held for investment were 0.36% of loans and leases held for investment at June 30, 2022, flat compared to March 31, 2022.
Performing TDRs were up $178 million compared to the prior quarter primarily due to an increase in government guaranteed residential mortgages.
Loans 90 days or more past due and still accruing totaled $1.8 billion at June 30, 2022, down $127 million, or seven basis points, as a percentage of loans and leases compared with the prior quarter primarily due to a decline in government guaranteed residential mortgages. Excluding government guaranteed loans, the ratio of loans 90 days or more past due and still accruing as a percentage of loans and leases was 0.04% at June 30, 2022, flat from March 31, 2022.
Loans 30-89 days past due and still accruing of $2.1 billion at June 30, 2022 were down $10 million, or three basis points as a percentage of loans and leases, compared to the prior quarter due to declines in the commercial and industrial portfolio, partially offset by a seasonal increase in the indirect auto portfolio.
Net charge-offs during the second quarter totaled $159 million, or 0.22% as a percentage of average loans, and were down three basis points compared to the prior quarter.
The allowance for credit losses was $4.4 billion and includes $4.2 billion for the allowance for loan and lease losses and $247 million for the reserve for unfunded commitments. The ALLL ratio was 1.38% compared to 1.44% at March 31, 2022. The decline in the ALLL ratio was due to strong portfolio performance partially offset by a moderately slower economic outlook. The ALLL covered nonperforming loans and leases held for investment 3.84X compared to 3.99X at March 31, 2022. At June 30, 2022, the ALLL was 6.54X annualized net charge-offs, compared to 5.78X at March 31, 2022.
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| SEGMENT RESULTS | Change 2Q22 vs. | ||||||||||||||||
| (dollars in millions) | |||||||||||||||||
| Segment Net Income | 2Q22 | 1Q22 | 2Q21 | 1Q22 | 2Q21 | ||||||||||||
| Consumer Banking and Wealth | $ | 773 | $ | 873 | $ | 799 | $ | (100) | $ | (26) | |||||||
| Corporate and Commercial Banking | 954 | 1,003 | 1,306 | (49) | (352) | ||||||||||||
| Insurance Holdings | 178 | 152 | 159 | 26 | 19 | ||||||||||||
| Other, Treasury & Corporate | (373) | (612) | (606) | 239 | 233 | ||||||||||||
| Total net income | $ | 1,532 | $ | 1,416 | $ | 1,658 | $ | 116 | $ | (126) | |||||||
Truist operates and measures business activity across three segments: Consumer Banking and Wealth, Corporate and Commercial Banking, and Insurance Holdings, with functional activities included in Other, Treasury and Corporate. The Company’s business segment structure is based on the manner in which financial information is evaluated by management as well as the products and services provided or the type of client served. For additional information, see “Note 21. Operating Segments” of the Annual Report on Form 10-K for the year ended December 31, 2021.
Second Quarter 2022 compared to First Quarter 2022
Consumer Banking and Wealth (“CB&W”)
CB&W net income was $773 million for the second quarter of 2022, a decrease of $100 million compared to the prior quarter. Segment net interest income increased $92 million primarily driven by favorable funding credits on deposits attributable to a higher rate environment, higher average loan balances, and one additional day, partially offset by a decrease in loan spreads and lower purchase accounting accretion. The allocated provision for credit losses increased $126 million reflecting the impact of loan growth in the current quarter and a reserve release in the prior quarter. Noninterest income decreased $58 million driven by a gain on the redemption of a noncontrolling equity interest in the prior quarter as well as lower residential mortgage income primarily driven by lower production income. These decreases were partially offset by an increase in card and payment related fees primarily due to seasonally higher spend in the current quarter as well as the prior quarter acquisition of certain merchant services relationships. Noninterest expense increased $46 million primarily due to higher merger-related and restructuring charges, professional fees and outside processing related to call center staffing, and marketing and customer development, partially offset by lower deposit related expenses in the current quarter.
Average loans held for investment increased $2.7 billion, or 2.0%, compared to the prior quarter primarily due to an increase in residential mortgages due to the continued strategy to put certain correspondent channel production onto the balance sheet and lower prepayments, an increase in indirect other primarily due to growth from the Service Finance, recreational lending and Sheffield portfolios partially offset by runoff in other partnership lending programs, an increase in the indirect auto prime portfolio as well as an increase in residential home equity and direct lending. These increases were partially offset by runoff in student loans. Average total deposits increased $2.2 billion, or 1.0%, compared to the prior quarter primarily due to an increase in non-interest bearing deposits, partially offset by a decrease in time deposits in the current quarter.
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Corporate and Commercial Banking (“C&CB”)
C&CB net income was $954 million for the second quarter of 2022, a decrease of $49 million compared to the prior quarter. Segment net interest income increased $64 million due to higher rates, growth in core loan balances from higher utilization rates, and one additional day. The allocated provision for credit losses increased $122 million primarily due to growth in the loan portfolio and a lower reserve release than the prior quarter, partially offset by the impact of lower net charge offs in the current quarter. Noninterest income increased $17 million primarily due to fixed income and lending fees, offset by lower investment banking fees. Noninterest expense increased $25 million primarily driven by increased personnel expenses due to strategic hiring in the current quarter.
Average loans held for investment increased $7.1 billion, or 4.6%, compared to the prior quarter primarily due to increases in core commercial and industrial loans partially offset by decreases in average PPP loans (commercial and industrial) and average commercial real estate loans. Average total deposits decreased $5.2 billion, or 3.4%, compared to the prior quarter primarily due to declines in interest bearing checking and money market and savings deposits.
Insurance Holdings (“IH”)
IH net income was $178 million for the second quarter of 2022, an increase of $26 million compared to the prior quarter. Noninterest income increased $95 million primarily due to increased production, seasonally higher property and casualty commissions, and acquisitions, partially offset by seasonally lower employee benefit plan commissions. Noninterest expense increased $64 million primarily due to incentive expenses related to higher revenues in the current quarter.
Other, Treasury & Corporate (“OT&C”)
OT&C generated a net loss of $373 million for the second quarter of 2022, compared to a net loss of $612 million for the prior quarter. Net interest income increased $64 million primarily due to higher earnings in the securities portfolio from purchases of higher yielding MBS and favorable hedge benefits. Noninterest income increased $52 million primarily driven by prior quarter losses on the sale of securities as well as valuation changes from assets held for certain post-retirement benefits. Noninterest expense decreased $229 million primarily driven by lower merger-related and restructuring charges and incremental operating expenses related to the merger due to diminishing integration-related activities, a gain on the redemption of FHLB advances, and lower occupancy expenses as well as lower professional fees and outside processing in the current quarter.
Second Quarter 2022 compared to Second Quarter 2021
Consumer Banking and Wealth
CB&W net income was $773 million for the second quarter of 2022, a decrease of $26 million compared to the earlier quarter. Segment net interest income increased $202 million primarily driven by favorable funding credit on deposits attributable to the higher rate environment and higher average loan balances, partially offset by decreased loan spreads and lower purchase accounting accretion. The allocated provision for credit losses increased $203 million reflecting the impact of loan growth in the current quarter and a reserve release in the earlier quarter as well as increased charge offs in the current quarter. Noninterest income decreased $33 million compared to earlier quarter driven by a decrease in residential mortgage income due to lower production income (due to lower margins and refinance volumes), partially offset by higher servicing income (due to lower prepayments and servicing portfolio purchases.) This decrease is partially offset by higher card and payment fees driven by higher merchant income due to the acquisition of certain merchant services relationships as well as higher consumer spend. Noninterest expense was flat compared to the earlier quarter.
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Corporate and Commercial Banking
C&CB net income was $954 million for the second quarter of 2022, a decrease of $352 million compared to the earlier quarter. Segment net interest income increased $38 million primarily due to higher funding credit on deposits, increases to noninterest-bearing deposit balances, and higher average loan balances, partially offset by lower PPP revenue and lower purchase accounting accretion. The allocated provision for credit losses increased $371 million primarily reflecting an allowance release in the earlier quarter and loan growth in the current quarter, partially offset by lower net charge offs in the current quarter. Noninterest income decreased $172 million compared to the earlier quarter due to lower investment banking revenue, partially offset by higher trading income due to higher CVA gains. Noninterest expense decreased $47 million driven by lower incentive expense tied to lower revenues as well as lower merger-related costs given diminishing integration-related activities in the current quarter.
Insurance Holdings
IH net income was $178 million for the second quarter of 2022, an increase of $19 million compared to the earlier quarter. Noninterest income increased $135 million primarily due to continued organic growth and acquisitions. Noninterest expense increased $109 million primarily due to higher performance-based incentives and salaries.
Other, Treasury & Corporate
OT&C generated a net loss of $373 million in the second quarter of 2022, compared to a net loss of $606 million in the earlier quarter. Net interest income decreased $81 million primarily due to higher funding credit on deposits to other segments, partially offset by higher earnings in the securities portfolio from higher yields on new purchases and lower premium amortization. Noninterest income decreased $87 million primarily due to valuation changes from assets held for certain post-retirement benefits, which is primarily offset by lower personnel expense. Noninterest expense decreased $502 million compared to the earlier quarter primarily due to charitable contributions to the Truist Foundation and the Truist Charitable Fund in the earlier quarter, lower merger-related and restructuring charges and incremental operating expenses related to the merger, a gain on the redemption of FHLB advances in the current quarter, and lower personnel expense due to lower other employee benefits as a result of the decrease in noninterest income for post-retirement benefits and lower incentives.
Earnings Presentation and Quarterly Performance Summary
To listen to Truist’s live second quarter 2022 earnings conference call at 8 a.m. ET today, please call 855-303-0072 and enter the participant code 100038. A presentation will be used during the earnings conference call and is available on our website at https://ir.truist.com/events-and-presentation. Replays of the conference call will be available for 30 days by dialing 888-203-1112 (access code 100038).
The presentation, including an appendix reconciling non-GAAP disclosures, and Truist’s Second Quarter 2022 Quarterly Performance Summary, which contains detailed financial schedules, are available at https://ir.truist.com/earnings.
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About Truist
Truist Financial Corporation is a purpose-driven financial services company committed to inspiring and building better lives and communities. Truist has leading market share in many high-growth markets in the country. The company offers a wide range of services including retail, small business and commercial banking; asset management; capital markets; commercial real estate; corporate and institutional banking; insurance; mortgage; payments; specialized lending; and wealth management. Headquartered in Charlotte, North Carolina, Truist is a top 10 U.S. commercial bank with total assets of $545 billion as of June 30, 2022. Truist Bank, Member FDIC. Learn more at Truist.com.
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Capital ratios and return on risk-weighted assets are preliminary.
This news release contains financial information and performance measures determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Truist’s management uses these “non-GAAP” measures in their analysis of the Corporation’s performance and the efficiency of its operations. Management believes these non-GAAP measures provide a greater understanding of ongoing operations, enhance comparability of results with prior periods and demonstrate the effects of significant items in the current period. The Corporation believes a meaningful analysis of its financial performance requires an understanding of the factors underlying that performance. Truist’s management believes investors may find these non-GAAP financial measures useful. These disclosures should not be viewed as a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Below is a listing of the types of non-GAAP measures used in this news release:
•Adjusted Efficiency Ratio - The adjusted efficiency ratio is non-GAAP in that it excludes securities gains (losses), amortization of intangible assets, merger-related and restructuring charges, and other selected items. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges.
•Adjusted Operating Leverage - The adjusted operating leverage ratio is non-GAAP in that it excludes securities gains (losses), amortization of intangible assets, merger-related and restructuring charges, and other selected items. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges.
•Pre-Provision Net Revenue (PPNR) - Pre-provision net revenue is a non-GAAP measure that adjusts net income determined in accordance with GAAP to exclude the impact of the provision for credit losses and provision for income taxes. Adjusted pre-provision net revenue is a non-GAAP measure that additionally excludes securities gains (losses), merger-related and restructuring charges, amortization of intangible assets, and other selected items. Truist’s management believes these measures provide a greater understanding of ongoing operations and enhances comparability of results with prior periods.
•Tangible Common Equity and Related Measures - Tangible common equity and related measures are non-GAAP measures that exclude the impact of intangible assets, net of deferred taxes, and their related amortization. These measures are useful for evaluating the performance of a business consistently, whether acquired or developed internally. Truist’s management uses these measures to assess the quality of capital and returns relative to balance sheet risk.
•Core NIM - Core net interest margin is a non-GAAP measure that adjusts net interest margin to exclude the impact of purchase accounting. The purchase accounting marks and related amortization for loans, deposits, and long-term debt from SunTrust and other acquisitions are excluded to approximate the yields paid by clients. Truist’s management believes the adjustments to the calculation of net interest margin for certain assets and liabilities acquired provide investors with useful information related to the performance of Truist’s earning assets.
•Adjusted Diluted EPS - The adjusted diluted earnings per share is non-GAAP in that it excludes merger-related and restructuring charges and other selected items, net of tax. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges.
•Performance Ratios - The adjusted performance ratios, including adjusted return on average assets, adjusted return on average common shareholders’ equity, and adjusted return on average tangible common shareholders’ equity, are non-GAAP in that they exclude merger-related and restructuring charges, selected items, and, in the case of return on average tangible common shareholders’ equity, amortization of intangible assets. Truist’s management uses these measures in their analysis of the Corporation’s performance. Truist’s management believes these measures provide a greater understanding of ongoing operations and enhance comparability of results with prior periods, as well as demonstrate the effects of significant gains and charges.
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•Insurance Holdings Adjusted EBITDA - EBITDA is a non-GAAP measurement of operating profitability that is calculated by adding back interest, taxes, depreciation, and amortization to net income. Truist’s management also adds back merger-related and restructuring charges, incremental operating expenses related to the merger, and other selected items. Truist’s management uses this measure in its analysis of the Corporation’s Insurance Holdings segment. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges.
•Allowance for Loan and Lease Losses and Unamortized Fair Value Mark as a Percentage of Gross Loans and Leases - Allowance for loan and lease losses and unamortized fair value mark as a percentage of gross loans and leases is a non-GAAP measurement of credit reserves that is calculated by adjusting the ALLL and loans and leases held for investment by the unamortized fair value mark. Truist’s management uses these measures to assess loss absorption capacity.
A reconciliation of each of these non-GAAP measures to the most directly comparable GAAP measure is included in the appendix to Truist’s Second Quarter 2022 Earnings Presentation, which is available at https://ir.truist.com/earnings.
This news release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, regarding the financial condition, results of operations, business plans and the future performance of Truist. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “projects,” “may,” “will,” “should,” “would,” “could” and other similar expressions are intended to identify these forward-looking statements.
Forward-looking statements are not based on historical facts but instead represent management’s expectations and assumptions regarding Truist’s business, the economy, and other future conditions. Such statements involve inherent uncertainties, risks, and changes in circumstances that are difficult to predict. As such, Truist’s actual results may differ materially from those contemplated by forward-looking statements. While there can be no assurance that any list of risks and uncertainties or risk factors is complete, important factors that could cause actual results to differ materially from those contemplated by forward-looking statements include the following, without limitation, as well as the risks and uncertainties more fully discussed under Part I, Item 1A-Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2021 and in Truist’s subsequent filings with the Securities and Exchange Commission:
•residual risks and uncertainties relating to the Merger of heritage BB&T and heritage SunTrust, including the ability to realize the anticipated benefits of the Merger;
•expenses relating to the Merger and application and data center decommissioning;
•deposit attrition, client loss or revenue loss following completed mergers or acquisitions may be greater than anticipated;
•the COVID-19 pandemic disrupted the global economy and adversely impacted Truist’s financial condition and results of operations, including through increased expenses, reduced fee income and net interest margin, decreased demand for certain types of loans, and increases in the allowance for credit losses; a resurgence of the pandemic, whether due to new variants of the coronavirus or other factors, could reintroduce or prolong these negative impacts and also adversely affect Truist’s capital and liquidity position or cost of capital, impair the ability of borrowers to repay outstanding loans, cause an outflow of deposits, and impair goodwill or other assets;
•Truist is subject to credit risk by lending or committing to lend money, and may have more credit risk and higher credit losses to the extent that loans are concentrated by loan type, industry segment, borrower type or location of the borrower or collateral;
•changes in the interest rate environment, including the replacement of LIBOR as an interest rate benchmark, which could adversely affect Truist’s revenue and expenses, the value of assets and obligations, and the availability and cost of capital, cash flows, and liquidity;
•inability to access short-term funding or liquidity, loss of client deposits or changes in Truist’s credit ratings, which could increase the cost of funding or limit access to capital markets;
•risk management oversight functions may not identify or address risks adequately, and management may not be able to effectively manage credit risk;
•risks resulting from the extensive use of models in Truist’s business, which may impact decisions made by management and regulators;
•failure to execute on strategic or operational plans, including the ability to successfully complete or integrate mergers and acquisitions;
•increased competition, including from (i) new or existing competitors that could have greater financial resources or be subject to different regulatory standards, and (ii) products and services offered by non-bank financial technology companies, may reduce Truist’s client base, cause Truist to lower prices for its products and services in order to maintain market share or otherwise adversely impact Truist’s businesses or results of operations;
•failure to maintain or enhance Truist’s competitive position with respect to new products, services and technology, whether it fails to anticipate client expectations or because its technological developments fail to perform as desired or do not achieve market acceptance or regulatory approval or for other reasons, may cause Truist to lose market share or incur additional expense;
•negative public opinion, which could damage Truist’s reputation;
•increased scrutiny regarding Truist’s consumer sales practices, training practices, incentive compensation design, and governance;
•regulatory matters, litigation or other legal actions, which may result in, among other things, costs, fines, penalties, restrictions on Truist’s business activities, reputational harm, negative publicity, or other adverse consequences;
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•evolving legislative, accounting and regulatory standards, including with respect to climate, capital, and liquidity requirements, and results of regulatory examinations may adversely affect Truist’s financial condition and results of operations;
•the monetary and fiscal policies of the federal government and its agencies, including in response to rising inflation, could have a material adverse effect on profitability;
•accounting policies and processes require management to make estimates about matters that are uncertain, including the potential write down to goodwill if there is an elongated period of decline in market value for Truist’s stock and adverse economic conditions are sustained over a period of time;
•general economic or business conditions, either globally, nationally or regionally, may be less favorable than expected, and instability in global geopolitical matters or volatility in financial markets could result in, among other things, slower deposit or asset growth, a deterioration in credit quality, or a reduced demand for credit, insurance, or other services;
•risks related to originating and selling mortgages, including repurchase and indemnity demands from purchasers related to representations and warranties on loans sold, which could result in an increase in the amount of losses for loan repurchases;
•risks relating to Truist’s role as a loan servicer, including an increase in the scope or costs of the services Truist is required to perform, without any corresponding increase in servicing fees or a breach of Truist’s obligations as servicer;
•Truist’s success depends on hiring and retaining key teammates, and if these individuals leave or change roles without effective replacements, Truist’s operations and integration activities could be adversely impacted, which could be exacerbated in the increased work-from-home environment caused by the COVID-19 pandemic as job markets may be less constrained by physical geography;
•fraud or misconduct by internal or external parties, which Truist may not be able to prevent, detect, or mitigate;
•security risks, including denial of service attacks, hacking, social engineering attacks targeting Truist’s teammates and clients, malware intrusion, data corruption attempts, system breaches, cyber-attacks, which have increased in frequency with current geopolitical tensions, identity theft, ransomware attacks, and physical security risks, such as natural disasters, environmental conditions, and intentional acts of destruction, could result in the disclosure of confidential information, adversely affect Truist’s business or reputation or create significant legal or financial exposure; and
•widespread outages of operational, communication, or other systems, whether internal or provided by third parties, natural or other disasters (including acts of terrorism and pandemics), and the effects of climate change, including physical risks, such as more frequent and intense weather events, and risks related to the transition to a lower carbon economy, such as regulatory or technological changes or shifts in market dynamics or consumer preferences, could have an adverse effect on Truist’s financial condition and results of operations, lead to material disruption of Truist’s operations or the ability or willingness of clients to access Truist’s products and services.
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. Except to the extent required by applicable law or regulation, Truist undertakes no obligation to revise or update any forward-looking statements.
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Quarterly Performance Summary
Truist Financial Corporation
Second Quarter 2022
| Table of Contents | ||||||||
| Quarterly Performance Summary | ||||||||
| Truist Financial Corporation | ||||||||
| Page | ||||||||
| Financial Highlights | ||||||||
| Financial Highlights - Five Quarter Trend | ||||||||
| Consolidated Statements of Income | ||||||||
| Consolidated Statements of Income - Five Quarter Trend | ||||||||
| Consolidated Ending Balance Sheets - Five Quarter Trend | ||||||||
| Average Balance Sheets | ||||||||
| Average Balance Sheets - Five Quarter Trend | ||||||||
| Average Balances and Rates - Quarters | ||||||||
| Credit Quality | ||||||||
| Segment Financial Performance - Five Quarter Trend | ||||||||
| Capital Information - Five Quarter Trend | ||||||||
| Selected Mortgage Banking Information & Additional Information | ||||||||
| Selected Items | ||||||||
| Non-GAAP Reconciliations | ||||||||
| Financial Highlights | ||||||||||||||||||||||||||||||||||||||
| Quarter Ended | Year-to-Date | |||||||||||||||||||||||||||||||||||||
| June 30 | % | June 30 | % | |||||||||||||||||||||||||||||||||||
| (Dollars in millions, except per share data, shares in thousands) | 2022 | 2021 | Change | 2022 | 2021 | Change | ||||||||||||||||||||||||||||||||
| Summary Income Statement | ||||||||||||||||||||||||||||||||||||||
| Interest income - taxable equivalent (1) | $ | 3,701 | $ | 3,471 | 6.6 | % | $ | 7,084 | $ | 6,993 | 1.3 | % | ||||||||||||||||||||||||||
| Interest expense | 266 | 198 | 34.3 | 440 | 407 | 8.1 | ||||||||||||||||||||||||||||||||
| Net interest income - taxable equivalent | 3,435 | 3,273 | 4.9 | 6,644 | 6,586 | 0.9 | ||||||||||||||||||||||||||||||||
| Less: Taxable-equivalent adjustment | 28 | 28 | — | 54 | 56 | (3.6) | ||||||||||||||||||||||||||||||||
| Net interest income | 3,407 | 3,245 | 5.0 | 6,590 | 6,530 | 0.9 | ||||||||||||||||||||||||||||||||
| Provision for credit losses | 171 | (434) | (139.4) | 76 | (386) | (119.7) | ||||||||||||||||||||||||||||||||
| Net interest income after provision for credit losses | 3,236 | 3,679 | (12.0) | 6,514 | 6,916 | (5.8) | ||||||||||||||||||||||||||||||||
| Noninterest income | 2,248 | 2,405 | (6.5) | 4,390 | 4,602 | (4.6) | ||||||||||||||||||||||||||||||||
| Noninterest expense | 3,580 | 4,011 | (10.7) | 7,254 | 7,621 | (4.8) | ||||||||||||||||||||||||||||||||
| Income before income taxes | 1,904 | 2,073 | (8.2) | 3,650 | 3,897 | (6.3) | ||||||||||||||||||||||||||||||||
| Provision for income taxes | 372 | 415 | (10.4) | 702 | 766 | (8.4) | ||||||||||||||||||||||||||||||||
| Net income | 1,532 | 1,658 | (7.6) | 2,948 | 3,131 | (5.8) | ||||||||||||||||||||||||||||||||
| Noncontrolling interests | 1 | 1 | — | 2 | (3) | (166.7) | ||||||||||||||||||||||||||||||||
| Net income available to the bank holding company | 1,531 | 1,657 | (7.6) | 2,946 | 3,134 | (6.0) | ||||||||||||||||||||||||||||||||
| Preferred stock dividends and other | 77 | 98 | (21.4) | 165 | 241 | (31.5) | ||||||||||||||||||||||||||||||||
| Net income available to common shareholders | 1,454 | 1,559 | (6.7) | 2,781 | 2,893 | (3.9) | ||||||||||||||||||||||||||||||||
| Per Common Share Data | ||||||||||||||||||||||||||||||||||||||
| Earnings per share-basic | $ | 1.09 | $ | 1.16 | (6.0) | % | $ | 2.09 | $ | 2.16 | (3.2) | % | ||||||||||||||||||||||||||
| Earnings per share-diluted | 1.09 | 1.16 | (6.0) | 2.08 | 2.14 | (2.8) | ||||||||||||||||||||||||||||||||
| Earnings per share-adjusted diluted (2) | 1.20 | 1.55 | (22.6) | 2.43 | 2.72 | (10.7) | ||||||||||||||||||||||||||||||||
| Cash dividends declared | 0.48 | 0.45 | 6.7 | 0.96 | 0.90 | 6.7 | ||||||||||||||||||||||||||||||||
| Common shareholders’ equity | 42.45 | 46.20 | (8.1) | 42.45 | 46.20 | (8.1) | ||||||||||||||||||||||||||||||||
| Tangible common shareholders’ equity (2) | 20.51 | 26.50 | (22.6) | 20.51 | 26.50 | (22.6) | ||||||||||||||||||||||||||||||||
| End of period shares outstanding | 1,326,393 | 1,334,770 | (0.6) | 1,326,393 | 1,334,770 | (0.6) | ||||||||||||||||||||||||||||||||
| Weighted average shares outstanding-basic | 1,330,160 | 1,338,302 | (0.6) | 1,329,601 | 1,341,963 | (0.9) | ||||||||||||||||||||||||||||||||
| Weighted average shares outstanding-diluted | 1,338,864 | 1,349,492 | (0.8) | 1,340,225 | 1,354,210 | (1.0) | ||||||||||||||||||||||||||||||||
| Performance Ratios | ||||||||||||||||||||||||||||||||||||||
| Return on average assets | 1.14 | % | 1.28 | % | 1.10 | % | 1.23 | % | ||||||||||||||||||||||||||||||
| Return on average risk-weighted assets (current period is preliminary) | 1.52 | 1.76 | 1.49 | 1.67 | ||||||||||||||||||||||||||||||||||
| Return on average common shareholders’ equity | 10.3 | 10.1 | 9.6 | 9.4 | ||||||||||||||||||||||||||||||||||
| Return on average tangible common shareholders’ equity (2) | 22.7 | 18.9 | 20.5 | 17.7 | ||||||||||||||||||||||||||||||||||
| Net interest margin - taxable equivalent | 2.89 | 2.88 | 2.83 | 2.95 | ||||||||||||||||||||||||||||||||||
| Fee income ratio | 39.7 | 42.6 | 40.0 | 41.3 | ||||||||||||||||||||||||||||||||||
| Efficiency ratio-GAAP | 63.3 | 71.0 | 66.1 | 68.5 | ||||||||||||||||||||||||||||||||||
| Efficiency ratio-adjusted (2) | 57.0 | 56.1 | 57.6 | 56.5 | ||||||||||||||||||||||||||||||||||
| Credit Quality | ||||||||||||||||||||||||||||||||||||||
| Nonperforming assets as a percentage of: | ||||||||||||||||||||||||||||||||||||||
| Assets, including LHFS | 0.22 | % | 0.23 | % | 0.22 | % | 0.23 | % | ||||||||||||||||||||||||||||||
| Loans and leases plus foreclosed property | 0.38 | 0.39 | 0.38 | 0.39 | ||||||||||||||||||||||||||||||||||
| Net charge-offs as a percentage of average loans and leases | 0.22 | 0.20 | 0.23 | 0.26 | ||||||||||||||||||||||||||||||||||
| Allowance for loan and lease losses as a percentage of LHFI | 1.38 | 1.79 | 1.38 | 1.79 | ||||||||||||||||||||||||||||||||||
| Ratio of allowance for loan and lease losses to nonperforming LHFI | 3.84x | 4.83x | 3.84x | 4.83x | ||||||||||||||||||||||||||||||||||
| Average Balances | ||||||||||||||||||||||||||||||||||||||
| Assets | $ | 540,568 | $ | 518,774 | 4.2 | % | $ | 538,287 | $ | 513,832 | 4.8 | % | ||||||||||||||||||||||||||
| Securities (3) | 148,681 | 135,647 | 9.6 | 150,673 | 128,984 | 16.8 | ||||||||||||||||||||||||||||||||
| Loans and leases | 299,861 | 292,965 | 2.4 | 296,193 | 296,235 | — | ||||||||||||||||||||||||||||||||
| Deposits | 423,750 | 396,255 | 6.9 | 419,517 | 389,756 | 7.6 | ||||||||||||||||||||||||||||||||
| Common shareholders’ equity | 56,803 | 61,709 | (8.0) | 58,451 | 61,979 | (5.7) | ||||||||||||||||||||||||||||||||
| Total shareholders’ equity | 63,500 | 68,665 | (7.5) | 65,140 | 69,352 | (6.1) | ||||||||||||||||||||||||||||||||
| Period-End Balances | ||||||||||||||||||||||||||||||||||||||
| Assets | $ | 545,123 | $ | 521,964 | 4.4 | % | $ | 545,123 | $ | 521,964 | 4.4 | % | ||||||||||||||||||||||||||
| Securities (3) | 139,359 | 139,879 | (0.4) | 139,359 | 139,879 | (0.4) | ||||||||||||||||||||||||||||||||
| Loans and leases | 307,300 | 289,494 | 6.2 | 307,300 | 289,494 | 6.2 | ||||||||||||||||||||||||||||||||
| Deposits | 424,759 | 398,279 | 6.6 | 424,759 | 398,279 | 6.6 | ||||||||||||||||||||||||||||||||
| Common shareholders’ equity | 56,302 | 61,663 | (8.7) | 56,302 | 61,663 | (8.7) | ||||||||||||||||||||||||||||||||
| Total shareholders’ equity | 62,999 | 68,336 | (7.8) | 62,999 | 68,336 | (7.8) | ||||||||||||||||||||||||||||||||
| Capital Ratios (current quarter is preliminary) | ||||||||||||||||||||||||||||||||||||||
| Common equity Tier 1 | 9.2 | % | 10.2 | % | 9.2 | % | 10.2 | % | ||||||||||||||||||||||||||||||
| Tier 1 | 10.8 | 12.0 | 10.8 | 12.0 | ||||||||||||||||||||||||||||||||||
| Total | 12.6 | 14.2 | 12.6 | 14.2 | ||||||||||||||||||||||||||||||||||
| Leverage | 8.6 | 9.1 | 8.6 | 9.1 | ||||||||||||||||||||||||||||||||||
| Supplementary leverage | 7.3 | 7.9 | 7.3 | 7.9 | ||||||||||||||||||||||||||||||||||
| Applicable ratios are annualized. | ||||||||||||||||||||||||||||||||||||||
NM - not meaningful | ||||||||||||||||||||||||||||||||||||||
| (1) Interest income includes certain fees, deferred costs, fair value mark accretion, and dividends. | ||||||||||||||||||||||||||||||||||||||
| (2) Represents a non-GAAP measure. See the calculations and management’s reasons for using these measures in the Non-GAAP Reconciliations and Preliminary Capital Information - Five Quarter Trend sections of this supplement. | ||||||||||||||||||||||||||||||||||||||
| (3) Includes AFS and HTM securities. Average balances reflect both AFS and HTM securities at amortized cost. Period-end balances reflect AFS securities at fair value and HTM securities at amortized cost. | ||||||||||||||||||||||||||||||||||||||
Truist Financial Corporation 1
| Financial Highlights - Five Quarter Trend | ||||||||||||||||||||||||||||||||
| Quarter Ended | ||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| (Dollars in millions, except per share data, shares in thousands) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||||
| Summary Income Statement | ||||||||||||||||||||||||||||||||
| Interest income - taxable equivalent (1) | $ | 3,701 | $ | 3,383 | $ | 3,435 | $ | 3,454 | $ | 3,471 | ||||||||||||||||||||||
| Interest expense | 266 | 174 | 168 | 193 | 198 | |||||||||||||||||||||||||||
| Net interest income - taxable equivalent | 3,435 | 3,209 | 3,267 | 3,261 | 3,273 | |||||||||||||||||||||||||||
| Less: Taxable-equivalent adjustment | 28 | 26 | 24 | 28 | 28 | |||||||||||||||||||||||||||
| Net interest income | 3,407 | 3,183 | 3,243 | 3,233 | 3,245 | |||||||||||||||||||||||||||
| Provision for credit losses | 171 | (95) | (103) | (324) | (434) | |||||||||||||||||||||||||||
| Net interest income after provision for credit losses | 3,236 | 3,278 | 3,346 | 3,557 | 3,679 | |||||||||||||||||||||||||||
| Noninterest income | 2,248 | 2,142 | 2,323 | 2,365 | 2,405 | |||||||||||||||||||||||||||
| Noninterest expense | 3,580 | 3,674 | 3,700 | 3,795 | 4,011 | |||||||||||||||||||||||||||
| Income before income taxes | 1,904 | 1,746 | 1,969 | 2,127 | 2,073 | |||||||||||||||||||||||||||
| Provision for income taxes | 372 | 330 | 367 | 423 | 415 | |||||||||||||||||||||||||||
| Net income | 1,532 | 1,416 | 1,602 | 1,704 | 1,658 | |||||||||||||||||||||||||||
| Noncontrolling interests | 1 | 1 | — | — | 1 | |||||||||||||||||||||||||||
| Net income available to the bank holding company | 1,531 | 1,415 | 1,602 | 1,704 | 1,657 | |||||||||||||||||||||||||||
| Preferred stock dividends and other | 77 | 88 | 78 | 88 | 98 | |||||||||||||||||||||||||||
| Net income available to common shareholders | 1,454 | 1,327 | 1,524 | 1,616 | 1,559 | |||||||||||||||||||||||||||
| Per Common Share Data | ||||||||||||||||||||||||||||||||
| Earnings per share-basic | $ | 1.09 | $ | 1.00 | $ | 1.15 | $ | 1.21 | $ | 1.16 | ||||||||||||||||||||||
| Earnings per share-diluted | 1.09 | 0.99 | 1.13 | 1.20 | 1.16 | |||||||||||||||||||||||||||
| Earnings per share-adjusted diluted (2) | 1.20 | 1.23 | 1.38 | 1.42 | 1.55 | |||||||||||||||||||||||||||
| Cash dividends declared | 0.48 | 0.48 | 0.48 | 0.48 | 0.45 | |||||||||||||||||||||||||||
| Common shareholders’ equity | 42.45 | 43.82 | 47.14 | 46.62 | 46.20 | |||||||||||||||||||||||||||
| Tangible common shareholders’ equity (2) | 20.51 | 21.87 | 25.47 | 26.34 | 26.50 | |||||||||||||||||||||||||||
| End of period shares outstanding | 1,326,393 | 1,331,414 | 1,327,818 | 1,334,892 | 1,334,770 | |||||||||||||||||||||||||||
| Weighted average shares outstanding-basic | 1,330,160 | 1,329,037 | 1,329,979 | 1,334,825 | 1,338,302 | |||||||||||||||||||||||||||
| Weighted average shares outstanding-diluted | 1,338,864 | 1,341,563 | 1,343,029 | 1,346,854 | 1,349,492 | |||||||||||||||||||||||||||
| Performance Ratios | ||||||||||||||||||||||||||||||||
| Return on average assets | 1.14 | % | 1.07 | % | 1.19 | % | 1.28 | % | 1.28 | % | ||||||||||||||||||||||
| Return on average risk-weighted assets (current quarter is preliminary) | 1.52 | 1.46 | 1.64 | 1.77 | 1.76 | |||||||||||||||||||||||||||
| Return on average common shareholders’ equity | 10.3 | 9.0 | 9.8 | 10.2 | 10.1 | |||||||||||||||||||||||||||
| Return on average tangible common shareholders’ equity (2) | 22.7 | 18.6 | 18.9 | 19.3 | 18.9 | |||||||||||||||||||||||||||
| Net interest margin - taxable equivalent | 2.89 | 2.76 | 2.76 | 2.81 | 2.88 | |||||||||||||||||||||||||||
| Fee income ratio | 39.7 | 40.2 | 41.7 | 42.2 | 42.6 | |||||||||||||||||||||||||||
| Efficiency ratio-GAAP | 63.3 | 69.0 | 66.5 | 67.8 | 71.0 | |||||||||||||||||||||||||||
| Efficiency ratio-adjusted (2) | 57.0 | 58.3 | 56.0 | 57.9 | 56.1 | |||||||||||||||||||||||||||
| Credit Quality | ||||||||||||||||||||||||||||||||
| Nonperforming assets as a percentage of: | ||||||||||||||||||||||||||||||||
| Assets, including LHFS | 0.22 | % | 0.21 | % | 0.21 | % | 0.23 | % | 0.23 | % | ||||||||||||||||||||||
| Loans and leases plus foreclosed property | 0.38 | 0.38 | 0.39 | 0.40 | 0.39 | |||||||||||||||||||||||||||
| Net charge-offs as a percentage of average loans and leases | 0.22 | 0.25 | 0.25 | 0.19 | 0.20 | |||||||||||||||||||||||||||
| Allowance for loan and lease losses as a percentage of LHFI | 1.38 | 1.44 | 1.53 | 1.65 | 1.79 | |||||||||||||||||||||||||||
| Ratio of allowance for loan and lease losses to nonperforming LHFI | 3.84x | 3.99x | 4.07x | 4.35x | 4.83x | |||||||||||||||||||||||||||
| Average Balances | ||||||||||||||||||||||||||||||||
| Assets | $ | 540,568 | $ | 535,981 | $ | 534,911 | $ | 526,685 | $ | 518,774 | ||||||||||||||||||||||
| Securities (3) | 148,681 | 152,687 | 153,405 | 146,272 | 135,647 | |||||||||||||||||||||||||||
| Loans and leases | 299,861 | 292,484 | 291,074 | 290,338 | 292,965 | |||||||||||||||||||||||||||
| Deposits | 423,750 | 415,238 | 410,966 | 402,728 | 396,255 | |||||||||||||||||||||||||||
| Common shareholders’ equity | 56,803 | 60,117 | 61,807 | 62,680 | 61,709 | |||||||||||||||||||||||||||
| Total shareholders’ equity | 63,500 | 66,798 | 68,480 | 69,353 | 68,665 | |||||||||||||||||||||||||||
| Period-End Balances | ||||||||||||||||||||||||||||||||
| Assets | $ | 545,123 | $ | 543,979 | $ | 541,241 | $ | 529,884 | $ | 521,964 | ||||||||||||||||||||||
| Securities (3) | 139,359 | 146,415 | 154,617 | 151,038 | 139,879 | |||||||||||||||||||||||||||
| Loans and leases | 307,300 | 294,248 | 294,325 | 290,655 | 289,494 | |||||||||||||||||||||||||||
| Deposits | 424,759 | 428,328 | 416,488 | 405,857 | 398,279 | |||||||||||||||||||||||||||
| Common shareholders’ equity | 56,302 | 58,348 | 62,598 | 62,227 | 61,663 | |||||||||||||||||||||||||||
| Total shareholders’ equity | 62,999 | 65,044 | 69,271 | 68,900 | 68,336 | |||||||||||||||||||||||||||
| Capital Ratios (current quarter is preliminary) | ||||||||||||||||||||||||||||||||
| Common equity Tier 1 | 9.2 | % | 9.4 | % | 9.6 | % | 10.1 | % | 10.2 | % | ||||||||||||||||||||||
| Tier 1 | 10.8 | 11.0 | 11.3 | 11.9 | 12.0 | |||||||||||||||||||||||||||
| Total | 12.6 | 13.0 | 13.2 | 13.9 | 14.2 | |||||||||||||||||||||||||||
| Leverage | 8.6 | 8.6 | 8.7 | 9.0 | 9.1 | |||||||||||||||||||||||||||
| Supplementary leverage | 7.3 | 7.3 | 7.4 | 7.8 | 7.9 | |||||||||||||||||||||||||||
| Applicable ratios are annualized. | ||||||||||||||||||||||||||||||||
| (1) Interest income includes certain fees, deferred costs, fair value mark accretion, and dividends. | ||||||||||||||||||||||||||||||||
| (2) Represents a non-GAAP measure. See the calculations and management’s reasons for using these measures in the Non-GAAP Reconciliations and Preliminary Capital Information - Five Quarter Trend sections of this supplement. | ||||||||||||||||||||||||||||||||
| (3) Includes AFS and HTM securities. Average balances reflect both AFS and HTM securities at amortized cost. Period-end balances reflect AFS securities at fair value and HTM securities at amortized cost. | ||||||||||||||||||||||||||||||||
2 Truist Financial Corporation
| Consolidated Statements of Income | |||||||||||||||||||||||||||||||||||||||||||||||
| Quarter Ended | Year-to-Date | ||||||||||||||||||||||||||||||||||||||||||||||
| June 30 | Change | June 30 | Change | ||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions, except per share data, shares in thousands) | 2022 | 2021 | $ | % | 2022 | 2021 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Interest Income | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest and fees on loans and leases | $ | 2,898 | $ | 2,901 | $ | (3) | (0.1) | % | $ | 5,542 | $ | 5,903 | $ | (361) | (6.1) | % | |||||||||||||||||||||||||||||||
| Interest on securities | 675 | 497 | 178 | 35.8 | 1,315 | 940 | 375 | 39.9 | |||||||||||||||||||||||||||||||||||||||
| Interest on other earning assets | 100 | 45 | 55 | 122.2 | 173 | 94 | 79 | 84.0 | |||||||||||||||||||||||||||||||||||||||
| Total interest income | 3,673 | 3,443 | 230 | 6.7 | 7,030 | 6,937 | 93 | 1.3 | |||||||||||||||||||||||||||||||||||||||
| Interest Expense | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest on deposits | 99 | 36 | 63 | 175.0 | 131 | 83 | 48 | 57.8 | |||||||||||||||||||||||||||||||||||||||
| Interest on long-term debt | 137 | 147 | (10) | (6.8) | 269 | 295 | (26) | (8.8) | |||||||||||||||||||||||||||||||||||||||
| Interest on other borrowings | 30 | 15 | 15 | 100.0 | 40 | 29 | 11 | 37.9 | |||||||||||||||||||||||||||||||||||||||
| Total interest expense | 266 | 198 | 68 | 34.3 | 440 | 407 | 33 | 8.1 | |||||||||||||||||||||||||||||||||||||||
| Net Interest Income | 3,407 | 3,245 | 162 | 5.0 | 6,590 | 6,530 | 60 | 0.9 | |||||||||||||||||||||||||||||||||||||||
| Provision for credit losses | 171 | (434) | 605 | (139.4) | 76 | (386) | 462 | (119.7) | |||||||||||||||||||||||||||||||||||||||
| Net Interest Income After Provision for Credit Losses | 3,236 | 3,679 | (443) | (12.0) | 6,514 | 6,916 | (402) | (5.8) | |||||||||||||||||||||||||||||||||||||||
| Noninterest Income | |||||||||||||||||||||||||||||||||||||||||||||||
| Insurance income | 825 | 690 | 135 | 19.6 | 1,552 | 1,316 | 236 | 17.9 | |||||||||||||||||||||||||||||||||||||||
| Investment banking and trading income | 255 | 402 | (147) | (36.6) | 516 | 748 | (232) | (31.0) | |||||||||||||||||||||||||||||||||||||||
| Wealth management income | 337 | 345 | (8) | (2.3) | 680 | 686 | (6) | (0.9) | |||||||||||||||||||||||||||||||||||||||
| Service charges on deposits | 254 | 253 | 1 | 0.4 | 506 | 511 | (5) | (1.0) | |||||||||||||||||||||||||||||||||||||||
| Card and payment related fees | 246 | 225 | 21 | 9.3 | 458 | 425 | 33 | 7.8 | |||||||||||||||||||||||||||||||||||||||
| Residential mortgage income | 74 | 117 | (43) | (36.8) | 163 | 217 | (54) | (24.9) | |||||||||||||||||||||||||||||||||||||||
| Lending related fees | 100 | 94 | 6 | 6.4 | 185 | 194 | (9) | (4.6) | |||||||||||||||||||||||||||||||||||||||
| Operating lease income | 66 | 66 | — | — | 124 | 134 | (10) | (7.5) | |||||||||||||||||||||||||||||||||||||||
| Commercial mortgage income | 26 | 47 | (21) | (44.7) | 58 | 80 | (22) | (27.5) | |||||||||||||||||||||||||||||||||||||||
| Income from bank-owned life insurance | 50 | 46 | 4 | 8.7 | 101 | 96 | 5 | 5.2 | |||||||||||||||||||||||||||||||||||||||
| Securities gains (losses) | (1) | — | (1) | NM | (70) | — | (70) | NM | |||||||||||||||||||||||||||||||||||||||
| Other income | 16 | 120 | (104) | (86.7) | 117 | 195 | (78) | (40.0) | |||||||||||||||||||||||||||||||||||||||
| Total noninterest income | 2,248 | 2,405 | (157) | (6.5) | 4,390 | 4,602 | (212) | (4.6) | |||||||||||||||||||||||||||||||||||||||
| Noninterest Expense | |||||||||||||||||||||||||||||||||||||||||||||||
| Personnel expense | 2,102 | 2,207 | (105) | (4.8) | 4,153 | 4,349 | (196) | (4.5) | |||||||||||||||||||||||||||||||||||||||
| Professional fees and outside processing | 349 | 341 | 8 | 2.3 | 712 | 691 | 21 | 3.0 | |||||||||||||||||||||||||||||||||||||||
| Software expense | 234 | 246 | (12) | (4.9) | 466 | 456 | 10 | 2.2 | |||||||||||||||||||||||||||||||||||||||
| Net occupancy expense | 181 | 182 | (1) | (0.5) | 389 | 391 | (2) | (0.5) | |||||||||||||||||||||||||||||||||||||||
| Amortization of intangibles | 143 | 142 | 1 | 0.7 | 280 | 286 | (6) | (2.1) | |||||||||||||||||||||||||||||||||||||||
| Equipment expense | 114 | 122 | (8) | (6.6) | 232 | 235 | (3) | (1.3) | |||||||||||||||||||||||||||||||||||||||
| Marketing and customer development | 93 | 66 | 27 | 40.9 | 177 | 132 | 45 | 34.1 | |||||||||||||||||||||||||||||||||||||||
| Operating lease depreciation | 47 | 47 | — | — | 95 | 97 | (2) | (2.1) | |||||||||||||||||||||||||||||||||||||||
| Loan-related expense | 47 | 55 | (8) | (14.5) | 91 | 109 | (18) | (16.5) | |||||||||||||||||||||||||||||||||||||||
| Regulatory costs | 44 | 31 | 13 | 41.9 | 79 | 56 | 23 | 41.1 | |||||||||||||||||||||||||||||||||||||||
| Merger-related and restructuring charges | 121 | 297 | (176) | (59.3) | 337 | 438 | (101) | (23.1) | |||||||||||||||||||||||||||||||||||||||
| Loss (gain) on early extinguishment of debt | (39) | — | (39) | NM | (39) | (3) | (36) | NM | |||||||||||||||||||||||||||||||||||||||
| Other expense | 144 | 275 | (131) | (47.6) | 282 | 384 | (102) | (26.6) | |||||||||||||||||||||||||||||||||||||||
| Total noninterest expense | 3,580 | 4,011 | (431) | (10.7) | 7,254 | 7,621 | (367) | (4.8) | |||||||||||||||||||||||||||||||||||||||
| Earnings | |||||||||||||||||||||||||||||||||||||||||||||||
| Income before income taxes | 1,904 | 2,073 | (169) | (8.2) | 3,650 | 3,897 | (247) | (6.3) | |||||||||||||||||||||||||||||||||||||||
| Provision for income taxes | 372 | 415 | (43) | (10.4) | 702 | 766 | (64) | (8.4) | |||||||||||||||||||||||||||||||||||||||
| Net income | 1,532 | 1,658 | (126) | (7.6) | 2,948 | 3,131 | (183) | (5.8) | |||||||||||||||||||||||||||||||||||||||
| Noncontrolling interests | 1 | 1 | — | — | 2 | (3) | 5 | (166.7) | |||||||||||||||||||||||||||||||||||||||
| Net income available to the bank holding company | 1,531 | 1,657 | (126) | (7.6) | 2,946 | 3,134 | (188) | (6.0) | |||||||||||||||||||||||||||||||||||||||
| Preferred stock dividends and other | 77 | 98 | (21) | (21.4) | 165 | 241 | (76) | (31.5) | |||||||||||||||||||||||||||||||||||||||
| Net income available to common shareholders | $ | 1,454 | $ | 1,559 | $ | (105) | (6.7) | % | $ | 2,781 | $ | 2,893 | $ | (112) | (3.9) | % | |||||||||||||||||||||||||||||||
| Earnings Per Common Share | |||||||||||||||||||||||||||||||||||||||||||||||
| Basic | $ | 1.09 | $ | 1.16 | $ | (0.07) | (6.0) | % | $ | 2.09 | $ | 2.16 | $ | (0.07) | (3.2) | % | |||||||||||||||||||||||||||||||
| Diluted | 1.09 | 1.16 | (0.07) | (6.0) | 2.08 | 2.14 | (0.06) | (2.8) | |||||||||||||||||||||||||||||||||||||||
| Weighted Average Shares Outstanding | |||||||||||||||||||||||||||||||||||||||||||||||
| Basic | 1,330,160 | 1,338,302 | (8,142) | (0.6) | 1,329,601 | 1,341,963 | (12,362) | (0.9) | |||||||||||||||||||||||||||||||||||||||
| Diluted | 1,338,864 | 1,349,492 | (10,628) | (0.8) | 1,340,225 | 1,354,210 | (13,985) | (1.0) | |||||||||||||||||||||||||||||||||||||||
| NM - not meaningful | |||||||||||||||||||||||||||||||||||||||||||||||
Truist Financial Corporation 3
20
| Consolidated Statements of Income - Five Quarter Trend | ||||||||||||||||||||||||||||||||
| Quarter Ended | ||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| (Dollars in millions, except per share data, shares in thousands) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||||
| Interest Income | ||||||||||||||||||||||||||||||||
| Interest and fees on loans and leases | $ | 2,898 | $ | 2,644 | $ | 2,753 | $ | 2,825 | $ | 2,901 | ||||||||||||||||||||||
| Interest on securities | 675 | 640 | 602 | 548 | 497 | |||||||||||||||||||||||||||
| Interest on other earning assets | 100 | 73 | 56 | 53 | 45 | |||||||||||||||||||||||||||
| Total interest income | 3,673 | 3,357 | 3,411 | 3,426 | 3,443 | |||||||||||||||||||||||||||
| Interest Expense | ||||||||||||||||||||||||||||||||
| Interest on deposits | 99 | 32 | 32 | 33 | 36 | |||||||||||||||||||||||||||
| Interest on long-term debt | 137 | 132 | 127 | 151 | 147 | |||||||||||||||||||||||||||
| Interest on other borrowings | 30 | 10 | 9 | 9 | 15 | |||||||||||||||||||||||||||
| Total interest expense | 266 | 174 | 168 | 193 | 198 | |||||||||||||||||||||||||||
| Net Interest Income | 3,407 | 3,183 | 3,243 | 3,233 | 3,245 | |||||||||||||||||||||||||||
| Provision for credit losses | 171 | (95) | (103) | (324) | (434) | |||||||||||||||||||||||||||
| Net Interest Income After Provision for Credit Losses | 3,236 | 3,278 | 3,346 | 3,557 | 3,679 | |||||||||||||||||||||||||||
| Noninterest Income | ||||||||||||||||||||||||||||||||
| Insurance income | 825 | 727 | 666 | 645 | 690 | |||||||||||||||||||||||||||
| Investment banking and trading income | 255 | 261 | 377 | 316 | 402 | |||||||||||||||||||||||||||
| Wealth management income | 337 | 343 | 350 | 356 | 345 | |||||||||||||||||||||||||||
| Service charges on deposits | 254 | 252 | 273 | 276 | 253 | |||||||||||||||||||||||||||
| Card and payment related fees | 246 | 212 | 224 | 225 | 225 | |||||||||||||||||||||||||||
| Residential mortgage income | 74 | 89 | 159 | 179 | 117 | |||||||||||||||||||||||||||
| Lending related fees | 100 | 85 | 81 | 74 | 94 | |||||||||||||||||||||||||||
| Operating lease income | 66 | 58 | 71 | 57 | 66 | |||||||||||||||||||||||||||
| Commercial mortgage income | 26 | 32 | 45 | 54 | 47 | |||||||||||||||||||||||||||
| Income from bank-owned life insurance | 50 | 51 | 44 | 43 | 46 | |||||||||||||||||||||||||||
| Securities gains (losses) | (1) | (69) | — | — | — | |||||||||||||||||||||||||||
| Other income | 16 | 101 | 33 | 140 | 120 | |||||||||||||||||||||||||||
| Total noninterest income | 2,248 | 2,142 | 2,323 | 2,365 | 2,405 | |||||||||||||||||||||||||||
| Noninterest Expense | ||||||||||||||||||||||||||||||||
| Personnel expense | 2,102 | 2,051 | 2,096 | 2,187 | 2,207 | |||||||||||||||||||||||||||
| Professional fees and outside processing | 349 | 363 | 379 | 372 | 341 | |||||||||||||||||||||||||||
| Software expense | 234 | 232 | 238 | 251 | 246 | |||||||||||||||||||||||||||
| Net occupancy expense | 181 | 208 | 186 | 187 | 182 | |||||||||||||||||||||||||||
| Amortization of intangibles | 143 | 137 | 143 | 145 | 142 | |||||||||||||||||||||||||||
| Equipment expense | 114 | 118 | 124 | 154 | 122 | |||||||||||||||||||||||||||
| Marketing and customer development | 93 | 84 | 68 | 94 | 66 | |||||||||||||||||||||||||||
| Operating lease depreciation | 47 | 48 | 46 | 47 | 47 | |||||||||||||||||||||||||||
| Loan-related expense | 47 | 44 | 51 | 52 | 55 | |||||||||||||||||||||||||||
| Regulatory costs | 44 | 35 | 38 | 43 | 31 | |||||||||||||||||||||||||||
| Merger-related and restructuring charges | 121 | 216 | 212 | 172 | 297 | |||||||||||||||||||||||||||
| Loss (gain) on early extinguishment of debt | (39) | — | (1) | — | — | |||||||||||||||||||||||||||
| Other expense | 144 | 138 | 120 | 91 | 275 | |||||||||||||||||||||||||||
| Total noninterest expense | 3,580 | 3,674 | 3,700 | 3,795 | 4,011 | |||||||||||||||||||||||||||
| Earnings | ||||||||||||||||||||||||||||||||
| Income before income taxes | 1,904 | 1,746 | 1,969 | 2,127 | 2,073 | |||||||||||||||||||||||||||
| Provision for income taxes | 372 | 330 | 367 | 423 | 415 | |||||||||||||||||||||||||||
| Net income | 1,532 | 1,416 | 1,602 | 1,704 | 1,658 | |||||||||||||||||||||||||||
| Noncontrolling interests | 1 | 1 | — | — | 1 | |||||||||||||||||||||||||||
| Net income available to the bank holding company | 1,531 | 1,415 | 1,602 | 1,704 | 1,657 | |||||||||||||||||||||||||||
| Preferred stock dividends and other | 77 | 88 | 78 | 88 | 98 | |||||||||||||||||||||||||||
| Net income available to common shareholders | $ | 1,454 | $ | 1,327 | $ | 1,524 | $ | 1,616 | $ | 1,559 | ||||||||||||||||||||||
| Earnings Per Common Share | ||||||||||||||||||||||||||||||||
| Basic | $ | 1.09 | $ | 1.00 | $ | 1.15 | $ | 1.21 | $ | 1.16 | ||||||||||||||||||||||
| Diluted | 1.09 | 0.99 | 1.13 | 1.20 | 1.16 | |||||||||||||||||||||||||||
| Weighted Average Shares Outstanding | ||||||||||||||||||||||||||||||||
| Basic | 1,330,160 | 1,329,037 | 1,329,979 | 1,334,825 | 1,338,302 | |||||||||||||||||||||||||||
| Diluted | 1,338,864 | 1,341,563 | 1,343,029 | 1,346,854 | 1,349,492 | |||||||||||||||||||||||||||
4 Truist Financial Corporation
| Consolidated Ending Balance Sheets - Five Quarter Trend | ||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||||||
| Cash and due from banks | $ | 5,511 | $ | 5,516 | $ | 5,085 | $ | 4,656 | $ | 5,077 | ||||||||||||||||||||||
| Interest-bearing deposits with banks | 17,602 | 23,606 | 15,210 | 15,171 | 21,480 | |||||||||||||||||||||||||||
| Securities borrowed or purchased under resale agreements | 2,650 | 2,322 | 4,028 | 1,919 | 1,242 | |||||||||||||||||||||||||||
| Trading assets at fair value | 5,230 | 5,920 | 4,423 | 6,972 | 5,945 | |||||||||||||||||||||||||||
| Securities available for sale at fair value | 79,278 | 84,753 | 153,123 | 151,038 | 139,879 | |||||||||||||||||||||||||||
| Securities held to maturity at amortized cost | 60,081 | 61,662 | 1,494 | — | — | |||||||||||||||||||||||||||
| Loans and leases: | ||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||
| Commercial and industrial | 149,840 | 141,060 | 138,762 | 133,791 | 135,881 | |||||||||||||||||||||||||||
| CRE | 22,149 | 22,774 | 23,951 | 24,309 | 25,399 | |||||||||||||||||||||||||||
| Commercial construction | 5,157 | 5,220 | 4,971 | 5,689 | 6,160 | |||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||
| Residential mortgage | 50,903 | 48,171 | 47,852 | 46,691 | 44,036 | |||||||||||||||||||||||||||
| Residential home equity and direct | 25,345 | 24,853 | 25,066 | 25,222 | 25,334 | |||||||||||||||||||||||||||
| Indirect auto | 27,419 | 25,756 | 26,441 | 26,923 | 26,696 | |||||||||||||||||||||||||||
| Indirect other | 11,961 | 11,043 | 10,883 | 11,155 | 11,039 | |||||||||||||||||||||||||||
| Student | 6,144 | 6,514 | 6,780 | 7,059 | 7,341 | |||||||||||||||||||||||||||
| Credit card | 4,744 | 4,690 | 4,807 | 4,683 | 4,599 | |||||||||||||||||||||||||||
| Total loans and leases held for investment | 303,662 | 290,081 | 289,513 | 285,522 | 286,485 | |||||||||||||||||||||||||||
| Loans held for sale | 3,638 | 4,167 | 4,812 | 5,133 | 3,009 | |||||||||||||||||||||||||||
| Total loans and leases | 307,300 | 294,248 | 294,325 | 290,655 | 289,494 | |||||||||||||||||||||||||||
| Allowance for loan and lease losses | (4,187) | (4,170) | (4,435) | (4,702) | (5,121) | |||||||||||||||||||||||||||
| Premises and equipment | 3,682 | 3,662 | 3,700 | 3,719 | 3,699 | |||||||||||||||||||||||||||
| Goodwill | 26,299 | 26,284 | 26,098 | 24,891 | 24,374 | |||||||||||||||||||||||||||
| Core deposit and other intangible assets | 3,535 | 3,693 | 3,408 | 2,930 | 2,665 | |||||||||||||||||||||||||||
| Loan servicing rights at fair value | 3,466 | 3,013 | 2,633 | 2,584 | 2,231 | |||||||||||||||||||||||||||
| Other assets | 34,676 | 33,470 | 32,149 | 30,051 | 30,999 | |||||||||||||||||||||||||||
| Total assets | $ | 545,123 | $ | 543,979 | $ | 541,241 | $ | 529,884 | $ | 521,964 | ||||||||||||||||||||||
| Liabilities | ||||||||||||||||||||||||||||||||
| Deposits: | ||||||||||||||||||||||||||||||||
| Noninterest-bearing deposits | $ | 147,752 | $ | 150,446 | $ | 145,892 | $ | 143,595 | $ | 138,623 | ||||||||||||||||||||||
| Interest checking | 114,143 | 119,572 | 115,754 | 108,954 | 107,993 | |||||||||||||||||||||||||||
| Money market and savings | 149,302 | 143,834 | 138,956 | 136,633 | 134,118 | |||||||||||||||||||||||||||
| Time deposits | 13,562 | 14,476 | 15,886 | 16,675 | 17,545 | |||||||||||||||||||||||||||
| Total deposits | 424,759 | 428,328 | 416,488 | 405,857 | 398,279 | |||||||||||||||||||||||||||
| Short-term borrowings | 13,736 | 5,147 | 5,292 | 5,226 | 5,652 | |||||||||||||||||||||||||||
| Long-term debt | 30,319 | 33,773 | 35,913 | 37,837 | 37,969 | |||||||||||||||||||||||||||
| Other liabilities | 13,310 | 11,687 | 14,277 | 12,064 | 11,728 | |||||||||||||||||||||||||||
| Total liabilities | 482,124 | 478,935 | 471,970 | 460,984 | 453,628 | |||||||||||||||||||||||||||
| Shareholders’ Equity: | ||||||||||||||||||||||||||||||||
| Preferred stock | 6,673 | 6,673 | 6,673 | 6,673 | 6,673 | |||||||||||||||||||||||||||
| Common stock | 6,632 | 6,657 | 6,639 | 6,674 | 6,674 | |||||||||||||||||||||||||||
| Additional paid-in capital | 34,410 | 34,539 | 34,565 | 34,977 | 34,898 | |||||||||||||||||||||||||||
| Retained earnings | 24,500 | 23,687 | 22,998 | 22,114 | 21,139 | |||||||||||||||||||||||||||
| Accumulated other comprehensive loss | (9,240) | (6,535) | (1,604) | (1,538) | (1,048) | |||||||||||||||||||||||||||
| Noncontrolling interests | 24 | 23 | — | — | — | |||||||||||||||||||||||||||
| Total shareholders’ equity | 62,999 | 65,044 | 69,271 | 68,900 | 68,336 | |||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 545,123 | $ | 543,979 | $ | 541,241 | $ | 529,884 | $ | 521,964 | ||||||||||||||||||||||
Truist Financial Corporation 5
| Average Balance Sheets | |||||||||||||||||||||||||||||||||||||||||||||||
| Quarter Ended | Year-to-Date | ||||||||||||||||||||||||||||||||||||||||||||||
| June 30 | Change | June 30 | Change | ||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2021 | $ | % | 2022 | 2021 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||||||||||||||||||||
| Securities at amortized cost (1): | |||||||||||||||||||||||||||||||||||||||||||||||
| U.S. Treasury | $ | 10,544 | $ | 9,070 | $ | 1,474 | 16.3% | $ | 10,219 | $ | 5,435 | $ | 4,784 | 88.0% | |||||||||||||||||||||||||||||||||
| U.S. government-sponsored entities (GSE) | 255 | 1,840 | (1,585) | (86.1) | % | 685 | 1,840 | (1,155) | (62.8) | ||||||||||||||||||||||||||||||||||||||
| Mortgage-backed securities issued by GSE | 133,339 | 124,251 | 9,088 | 7.3 | 135,185 | 121,228 | 13,957 | 11.5 | |||||||||||||||||||||||||||||||||||||||
| States and political subdivisions | 371 | 437 | (66) | (15.1) | 372 | 441 | (69) | (15.6) | |||||||||||||||||||||||||||||||||||||||
| Non-agency mortgage-backed | 4,097 | 17 | 4,080 | NM | 4,161 | 8 | 4,153 | NM | |||||||||||||||||||||||||||||||||||||||
| Other | 75 | 32 | 43 | 134.4 | 51 | 32 | 19 | 59.4 | |||||||||||||||||||||||||||||||||||||||
| Total securities | 148,681 | 135,647 | 13,034 | 9.6 | 150,673 | 128,984 | 21,689 | 16.8 | |||||||||||||||||||||||||||||||||||||||
| Loans and leases: | |||||||||||||||||||||||||||||||||||||||||||||||
| Commercial: | |||||||||||||||||||||||||||||||||||||||||||||||
| Commercial and industrial | 145,558 | 138,539 | 7,019 | 5.1 | 142,233 | 139,776 | 2,457 | 1.8 | |||||||||||||||||||||||||||||||||||||||
| CRE | 22,508 | 25,645 | (3,137) | (12.2) | 23,029 | 25,926 | (2,897) | (11.2) | |||||||||||||||||||||||||||||||||||||||
| Commercial construction | 5,256 | 6,359 | (1,103) | (17.3) | 5,152 | 6,457 | (1,305) | (20.2) | |||||||||||||||||||||||||||||||||||||||
| Consumer: | |||||||||||||||||||||||||||||||||||||||||||||||
| Residential mortgage | 49,237 | 43,605 | 5,632 | 12.9 | 48,610 | 44,708 | 3,902 | 8.7 | |||||||||||||||||||||||||||||||||||||||
| Residential home equity and direct | 25,124 | 25,238 | (114) | (0.5) | 25,004 | 25,447 | (443) | (1.7) | |||||||||||||||||||||||||||||||||||||||
| Indirect auto | 26,496 | 26,444 | 52 | 0.2 | 26,293 | 26,403 | (110) | (0.4) | |||||||||||||||||||||||||||||||||||||||
| Indirect other | 11,471 | 10,797 | 674 | 6.2 | 11,167 | 10,823 | 344 | 3.2 | |||||||||||||||||||||||||||||||||||||||
| Student | 6,331 | 7,396 | (1,065) | (14.4) | 6,489 | 7,457 | (968) | (13.0) | |||||||||||||||||||||||||||||||||||||||
| Credit card | 4,728 | 4,552 | 176 | 3.9 | 4,705 | 4,598 | 107 | 2.3 | |||||||||||||||||||||||||||||||||||||||
| Total loans and leases held for investment | 296,709 | 288,575 | 8,134 | 2.8 | 292,682 | 291,595 | 1,087 | 0.4 | |||||||||||||||||||||||||||||||||||||||
| Loans held for sale | 3,152 | 4,390 | (1,238) | (28.2) | 3,511 | 4,640 | (1,129) | (24.3) | |||||||||||||||||||||||||||||||||||||||
| Total loans and leases | 299,861 | 292,965 | 6,896 | 2.4 | 296,193 | 296,235 | (42) | — | |||||||||||||||||||||||||||||||||||||||
| Interest earning trading assets | 6,073 | 5,061 | 1,012 | 20.0 | 5,956 | 4,902 | 1,054 | 21.5 | |||||||||||||||||||||||||||||||||||||||
| Other earning assets | 21,203 | 21,592 | (389) | (1.8) | 20,074 | 19,515 | 559 | 2.9 | |||||||||||||||||||||||||||||||||||||||
| Total earning assets | 475,818 | 455,265 | 20,553 | 4.5 | 472,896 | 449,636 | 23,260 | 5.2 | |||||||||||||||||||||||||||||||||||||||
| Nonearning assets | 64,750 | 63,509 | 1,241 | 2.0 | 65,391 | 64,196 | 1,195 | 1.9 | |||||||||||||||||||||||||||||||||||||||
| Total assets | $ | 540,568 | $ | 518,774 | $ | 21,794 | 4.2 | % | $ | 538,287 | $ | 513,832 | $ | 24,455 | 4.8 | % | |||||||||||||||||||||||||||||||
| Liabilities and Shareholders’ Equity | |||||||||||||||||||||||||||||||||||||||||||||||
| Deposits: | |||||||||||||||||||||||||||||||||||||||||||||||
| Noninterest-bearing deposits | $ | 148,610 | $ | 137,892 | $ | 10,718 | 7.8 | % | $ | 147,279 | $ | 133,261 | $ | 14,018 | 10.5 | % | |||||||||||||||||||||||||||||||
| Interest checking | 112,375 | 106,121 | 6,254 | 5.9 | 112,268 | 105,436 | 6,832 | 6.5 | |||||||||||||||||||||||||||||||||||||||
| Money market and savings | 148,632 | 134,029 | 14,603 | 10.9 | 145,085 | 131,680 | 13,405 | 10.2 | |||||||||||||||||||||||||||||||||||||||
| Time deposits | 14,133 | 18,213 | (4,080) | (22.4) | 14,885 | 19,379 | (4,494) | (23.2) | |||||||||||||||||||||||||||||||||||||||
| Total deposits | 423,750 | 396,255 | 27,495 | 6.9 | 419,517 | 389,756 | 29,761 | 7.6 | |||||||||||||||||||||||||||||||||||||||
| Short-term borrowings | 9,618 | 6,168 | 3,450 | 55.9 | 8,289 | 6,448 | 1,841 | 28.6 | |||||||||||||||||||||||||||||||||||||||
| Long-term debt | 31,263 | 36,873 | (5,610) | (15.2) | 33,289 | 37,344 | (4,055) | (10.9) | |||||||||||||||||||||||||||||||||||||||
| Other liabilities | 12,437 | 10,813 | 1,624 | 15.0 | 12,052 | 10,932 | 1,120 | 10.2 | |||||||||||||||||||||||||||||||||||||||
| Total liabilities | 477,068 | 450,109 | 26,959 | 6.0 | 473,147 | 444,480 | 28,667 | 6.4 | |||||||||||||||||||||||||||||||||||||||
| Shareholders’ equity | 63,500 | 68,665 | (5,165) | (7.5) | 65,140 | 69,352 | (4,212) | (6.1) | |||||||||||||||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 540,568 | $ | 518,774 | $ | 21,794 | 4.2 | % | $ | 538,287 | $ | 513,832 | $ | 24,455 | 4.8 | % | |||||||||||||||||||||||||||||||
| Average balances exclude basis adjustments for fair value hedges. | |||||||||||||||||||||||||||||||||||||||||||||||
| (1) Includes AFS and HTM securities. | |||||||||||||||||||||||||||||||||||||||||||||||
| NM - not meaningful | |||||||||||||||||||||||||||||||||||||||||||||||
6 Truist Financial Corporation
| Average Balance Sheets - Five Quarter Trend | ||||||||||||||||||||||||||||||||
| Quarter Ended | ||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||||||
| Securities at amortized cost (1): | ||||||||||||||||||||||||||||||||
| U.S. Treasury | $ | 10,544 | $ | 9,890 | $ | 9,891 | $ | 9,699 | $ | 9,070 | ||||||||||||||||||||||
| U.S. government-sponsored entities (GSE) | 255 | 1,120 | 1,686 | 1,830 | 1,840 | |||||||||||||||||||||||||||
| Mortgage-backed securities issued by GSE | 133,339 | 137,052 | 137,651 | 132,890 | 124,251 | |||||||||||||||||||||||||||
| States and political subdivisions | 371 | 374 | 410 | 425 | 437 | |||||||||||||||||||||||||||
| Non-agency mortgage-backed | 4,097 | 4,224 | 3,738 | 1,398 | 17 | |||||||||||||||||||||||||||
| Other | 75 | 27 | 29 | 30 | 32 | |||||||||||||||||||||||||||
| Total securities | 148,681 | 152,687 | 153,405 | 146,272 | 135,647 | |||||||||||||||||||||||||||
| Loans and leases: | ||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||
| Commercial and industrial | 145,558 | 138,872 | 134,804 | 134,942 | 138,539 | |||||||||||||||||||||||||||
| CRE | 22,508 | 23,555 | 24,396 | 24,849 | 25,645 | |||||||||||||||||||||||||||
| Commercial construction | 5,256 | 5,046 | 5,341 | 5,969 | 6,359 | |||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||
| Residential mortgage | 49,237 | 47,976 | 47,185 | 45,369 | 43,605 | |||||||||||||||||||||||||||
| Residential home equity and direct | 25,124 | 24,883 | 25,146 | 25,242 | 25,238 | |||||||||||||||||||||||||||
| Indirect auto | 26,496 | 26,088 | 26,841 | 26,830 | 26,444 | |||||||||||||||||||||||||||
| Indirect other | 11,471 | 10,860 | 10,978 | 11,112 | 10,797 | |||||||||||||||||||||||||||
| Student | 6,331 | 6,648 | 6,884 | 7,214 | 7,396 | |||||||||||||||||||||||||||
| Credit card | 4,728 | 4,682 | 4,769 | 4,632 | 4,552 | |||||||||||||||||||||||||||
| Total loans and leases held for investment | 296,709 | 288,610 | 286,344 | 286,159 | 288,575 | |||||||||||||||||||||||||||
| Loans held for sale | 3,152 | 3,874 | 4,730 | 4,179 | 4,390 | |||||||||||||||||||||||||||
| Total loans and leases | 299,861 | 292,484 | 291,074 | 290,338 | 292,965 | |||||||||||||||||||||||||||
| Interest earning trading assets | 6,073 | 5,837 | 6,772 | 5,809 | 5,061 | |||||||||||||||||||||||||||
| Other earning assets | 21,203 | 18,932 | 19,634 | 19,331 | 21,592 | |||||||||||||||||||||||||||
| Total earning assets | 475,818 | 469,940 | 470,885 | 461,750 | 455,265 | |||||||||||||||||||||||||||
| Nonearning assets | 64,750 | 66,041 | 64,026 | 64,935 | 63,509 | |||||||||||||||||||||||||||
| Total assets | $ | 540,568 | $ | 535,981 | $ | 534,911 | $ | 526,685 | $ | 518,774 | ||||||||||||||||||||||
| Liabilities and Shareholders’ Equity | ||||||||||||||||||||||||||||||||
| Deposits: | ||||||||||||||||||||||||||||||||
| Noninterest-bearing deposits | $ | 148,610 | $ | 145,933 | $ | 146,492 | $ | 141,738 | $ | 137,892 | ||||||||||||||||||||||
| Interest checking | 112,375 | 112,159 | 110,506 | 107,802 | 106,121 | |||||||||||||||||||||||||||
| Money market and savings | 148,632 | 141,500 | 137,676 | 136,094 | 134,029 | |||||||||||||||||||||||||||
| Time deposits | 14,133 | 15,646 | 16,292 | 17,094 | 18,213 | |||||||||||||||||||||||||||
| Total deposits | 423,750 | 415,238 | 410,966 | 402,728 | 396,255 | |||||||||||||||||||||||||||
| Short-term borrowings | 9,618 | 6,944 | 6,433 | 5,360 | 6,168 | |||||||||||||||||||||||||||
| Long-term debt | 31,263 | 35,337 | 37,623 | 37,329 | 36,873 | |||||||||||||||||||||||||||
| Other liabilities | 12,437 | 11,664 | 11,409 | 11,915 | 10,813 | |||||||||||||||||||||||||||
| Total liabilities | 477,068 | 469,183 | 466,431 | 457,332 | 450,109 | |||||||||||||||||||||||||||
| Shareholders’ equity | 63,500 | 66,798 | 68,480 | 69,353 | 68,665 | |||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 540,568 | $ | 535,981 | $ | 534,911 | $ | 526,685 | $ | 518,774 | ||||||||||||||||||||||
| Average balances exclude basis adjustments for fair value hedges. | ||||||||||||||||||||||||||||||||
| (1) Includes AFS and HTM securities. | ||||||||||||||||||||||||||||||||
Truist Financial Corporation 7
| Average Balances and Rates - Quarters | ||||||||||||||||||||||||||||||||||||||
| Quarter Ended | ||||||||||||||||||||||||||||||||||||||
| June 30, 2022 | March 31, 2022 | |||||||||||||||||||||||||||||||||||||
| (1) | (2) Interest | (2) | (1) | (2) Interest | (2) | |||||||||||||||||||||||||||||||||
| Average | Income/ | Yields/ | Average | Income/ | Yields/ | |||||||||||||||||||||||||||||||||
| (Dollars in millions) | Balances | Expense | Rates | Balances | Expense | Rates | ||||||||||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||||||||||||
| Securities at amortized cost (3): | ||||||||||||||||||||||||||||||||||||||
| U.S. Treasury | $ | 10,544 | $ | 22 | 0.86 | % | $ | 9,890 | $ | 18 | 0.72 | % | ||||||||||||||||||||||||||
| U.S. government-sponsored entities (GSE) | 255 | 1 | 1.96 | 1,120 | 6 | 2.13 | ||||||||||||||||||||||||||||||||
| Mortgage-backed securities issued by GSE | 133,339 | 625 | 1.88 | 137,052 | 590 | 1.72 | ||||||||||||||||||||||||||||||||
| States and political subdivisions | 371 | 4 | 3.83 | 374 | 3 | 3.72 | ||||||||||||||||||||||||||||||||
| Non-agency mortgage-backed | 4,097 | 23 | 2.30 | 4,224 | 24 | 2.25 | ||||||||||||||||||||||||||||||||
| Other | 75 | 1 | 3.66 | 27 | — | 2.04 | ||||||||||||||||||||||||||||||||
| Total securities | 148,681 | 676 | 1.82 | 152,687 | 641 | 1.68 | ||||||||||||||||||||||||||||||||
| Loans and leases: | ||||||||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||||||||
| Commercial and industrial | 145,558 | 1,174 | 3.24 | 138,872 | 987 | 2.88 | ||||||||||||||||||||||||||||||||
| CRE | 22,508 | 193 | 3.41 | 23,555 | 168 | 2.84 | ||||||||||||||||||||||||||||||||
| Commercial construction | 5,256 | 43 | 3.46 | 5,046 | 35 | 3.05 | ||||||||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||||||||
| Residential mortgage | 49,237 | 440 | 3.58 | 47,976 | 428 | 3.57 | ||||||||||||||||||||||||||||||||
| Residential home equity and direct | 25,124 | 329 | 5.25 | 24,883 | 330 | 5.38 | ||||||||||||||||||||||||||||||||
| Indirect auto | 26,496 | 362 | 5.47 | 26,088 | 357 | 5.56 | ||||||||||||||||||||||||||||||||
| Indirect other | 11,471 | 180 | 6.27 | 10,860 | 169 | 6.32 | ||||||||||||||||||||||||||||||||
| Student | 6,331 | 66 | 4.20 | 6,648 | 63 | 3.86 | ||||||||||||||||||||||||||||||||
| Credit card | 4,728 | 105 | 8.91 | 4,682 | 104 | 8.97 | ||||||||||||||||||||||||||||||||
| Total loans and leases held for investment | 296,709 | 2,892 | 3.91 | 288,610 | 2,641 | 3.70 | ||||||||||||||||||||||||||||||||
| Loans held for sale | 3,152 | 33 | 4.20 | 3,874 | 28 | 2.87 | ||||||||||||||||||||||||||||||||
| Total loans and leases | 299,861 | 2,925 | 3.91 | 292,484 | 2,669 | 3.69 | ||||||||||||||||||||||||||||||||
| Interest earning trading assets | 6,073 | 55 | 3.55 | 5,837 | 43 | 3.04 | ||||||||||||||||||||||||||||||||
| Other earning assets | 21,203 | 45 | 0.85 | 18,932 | 30 | 0.63 | ||||||||||||||||||||||||||||||||
| Total earning assets | 475,818 | 3,701 | 3.12 | 469,940 | 3,383 | 2.90 | ||||||||||||||||||||||||||||||||
| Nonearning assets | 64,750 | 66,041 | ||||||||||||||||||||||||||||||||||||
| Total assets | $ | 540,568 | $ | 535,981 | ||||||||||||||||||||||||||||||||||
| Liabilities and Shareholders’ Equity | ||||||||||||||||||||||||||||||||||||||
| Interest-bearing deposits: | ||||||||||||||||||||||||||||||||||||||
| Interest checking | $ | 112,375 | 43 | 0.15 | $ | 112,159 | 14 | 0.05 | ||||||||||||||||||||||||||||||
| Money market and savings | 148,632 | 50 | 0.13 | 141,500 | 11 | 0.03 | ||||||||||||||||||||||||||||||||
| Time deposits | 14,133 | 6 | 0.17 | 15,646 | 7 | 0.18 | ||||||||||||||||||||||||||||||||
| Total interest-bearing deposits (4) | 275,140 | 99 | 0.14 | 269,305 | 32 | 0.05 | ||||||||||||||||||||||||||||||||
| Short-term borrowings | 9,618 | 30 | 1.26 | 6,944 | 10 | 0.60 | ||||||||||||||||||||||||||||||||
| Long-term debt | 31,263 | 137 | 1.75 | 35,337 | 132 | 1.50 | ||||||||||||||||||||||||||||||||
| Total interest-bearing liabilities | 316,021 | 266 | 0.34 | 311,586 | 174 | 0.22 | ||||||||||||||||||||||||||||||||
| Noninterest-bearing deposits (4) | 148,610 | 145,933 | ||||||||||||||||||||||||||||||||||||
| Other liabilities | 12,437 | 11,664 | ||||||||||||||||||||||||||||||||||||
| Shareholders’ equity | 63,500 | 66,798 | ||||||||||||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 540,568 | $ | 535,981 | ||||||||||||||||||||||||||||||||||
| Average interest-rate spread | 2.78 | 2.68 | ||||||||||||||||||||||||||||||||||||
| Net interest income/ net interest margin - taxable equivalent | $ | 3,435 | 2.89 | % | $ | 3,209 | 2.76 | % | ||||||||||||||||||||||||||||||
| Taxable-equivalent adjustment | $ | 28 | $ | 26 | ||||||||||||||||||||||||||||||||||
| Applicable ratios are annualized. | ||||||||||||||||||||||||||||||||||||||
| (1) Excludes basis adjustments for fair value hedges. | ||||||||||||||||||||||||||||||||||||||
| (2) Amounts are on a taxable-equivalent basis utilizing the federal income tax rate of 21% for the periods presented. Interest income includes certain fees, deferred costs, and dividends. | ||||||||||||||||||||||||||||||||||||||
| (3) Includes AFS and HTM securities. | ||||||||||||||||||||||||||||||||||||||
| (4) Total deposit costs were 0.09% and 0.03% for the three months ended June 30, 2022 and March 31, 2022, respectively. | ||||||||||||||||||||||||||||||||||||||
8 Truist Financial Corporation
| Average Balances and Rates - Quarters | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Quarter Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| December 31, 2021 | September 30, 2021 | June 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (1) | (2) Interest | (2) | (1) | (2) Interest | (2) | (1) | (2) Interest | (2) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Average | Income/ | Yields/ | Average | Income/ | Yields/ | Average | Income/ | Yields/ | ||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | Balances | Expense | Rates | Balances | Expense | Rates | Balances | Expense | Rates | |||||||||||||||||||||||||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Securities at amortized cost (3): | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| U.S. Treasury | $ | 9,891 | $ | 18 | 0.72 | % | $ | 9,699 | $ | 18 | 0.72 | % | $ | 9,070 | $ | 16 | 0.73 | % | ||||||||||||||||||||||||||||||||||||||
| U.S. government-sponsored entities (GSE) | 1,686 | 9 | 2.20 | 1,830 | 10 | 2.31 | 1,840 | 11 | 2.33 | |||||||||||||||||||||||||||||||||||||||||||||||
| Mortgage-backed securities issued by GSE | 137,651 | 552 | 1.60 | 132,890 | 509 | 1.53 | 124,251 | 466 | 1.50 | |||||||||||||||||||||||||||||||||||||||||||||||
| States and political subdivisions | 410 | 3 | 3.60 | 425 | 4 | 3.52 | 437 | 4 | 3.55 | |||||||||||||||||||||||||||||||||||||||||||||||
| Non-agency mortgage-backed | 3,738 | 20 | 2.23 | 1,398 | 8 | 2.20 | 17 | — | 2.46 | |||||||||||||||||||||||||||||||||||||||||||||||
| Other | 29 | 1 | 1.90 | 30 | — | 1.90 | 32 | — | 1.88 | |||||||||||||||||||||||||||||||||||||||||||||||
| Total securities | 153,405 | 603 | 1.57 | 146,272 | 549 | 1.50 | 135,647 | 497 | 1.47 | |||||||||||||||||||||||||||||||||||||||||||||||
| Loans and leases: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commercial and industrial | 134,804 | 986 | 2.90 | 134,942 | 1,023 | 3.01 | 138,539 | 1,072 | 3.10 | |||||||||||||||||||||||||||||||||||||||||||||||
| CRE | 24,396 | 175 | 2.81 | 24,849 | 181 | 2.86 | 25,645 | 183 | 2.84 | |||||||||||||||||||||||||||||||||||||||||||||||
| Commercial construction | 5,341 | 38 | 2.96 | 5,969 | 42 | 2.96 | 6,359 | 45 | 2.95 | |||||||||||||||||||||||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Residential mortgage | 47,185 | 453 | 3.84 | 45,369 | 450 | 3.96 | 43,605 | 474 | 4.35 | |||||||||||||||||||||||||||||||||||||||||||||||
| Residential home equity and direct | 25,146 | 352 | 5.55 | 25,242 | 360 | 5.67 | 25,238 | 361 | 5.74 | |||||||||||||||||||||||||||||||||||||||||||||||
| Indirect auto | 26,841 | 389 | 5.75 | 26,830 | 405 | 5.99 | 26,444 | 409 | 6.20 | |||||||||||||||||||||||||||||||||||||||||||||||
| Indirect other | 10,978 | 176 | 6.42 | 11,112 | 183 | 6.54 | 10,797 | 185 | 6.86 | |||||||||||||||||||||||||||||||||||||||||||||||
| Student | 6,884 | 70 | 4.07 | 7,214 | 74 | 4.02 | 7,396 | 72 | 3.90 | |||||||||||||||||||||||||||||||||||||||||||||||
| Credit card | 4,769 | 105 | 8.69 | 4,632 | 105 | 9.01 | 4,552 | 99 | 8.73 | |||||||||||||||||||||||||||||||||||||||||||||||
| Total loans and leases held for investment | 286,344 | 2,744 | 3.81 | 286,159 | 2,823 | 3.92 | 288,575 | 2,900 | 4.03 | |||||||||||||||||||||||||||||||||||||||||||||||
| Loans held for sale | 4,730 | 32 | 2.66 | 4,179 | 28 | 2.69 | 4,390 | 28 | 2.57 | |||||||||||||||||||||||||||||||||||||||||||||||
| Total loans and leases | 291,074 | 2,776 | 3.79 | 290,338 | 2,851 | 3.90 | 292,965 | 2,928 | 4.01 | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest earning trading assets | 6,772 | 46 | 2.72 | 5,809 | 41 | 2.81 | 5,061 | 37 | 2.82 | |||||||||||||||||||||||||||||||||||||||||||||||
| Other earning assets | 19,634 | 10 | 0.20 | 19,331 | 13 | 0.25 | 21,592 | 9 | 0.19 | |||||||||||||||||||||||||||||||||||||||||||||||
| Total earning assets | 470,885 | 3,435 | 2.90 | 461,750 | 3,454 | 2.98 | 455,265 | 3,471 | 3.06 | |||||||||||||||||||||||||||||||||||||||||||||||
| Nonearning assets | 64,026 | 64,935 | 63,509 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total assets | $ | 534,911 | $ | 526,685 | $ | 518,774 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Liabilities and Shareholders’ Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest-bearing deposits: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest checking | $ | 110,506 | 15 | 0.05 | $ | 107,802 | 14 | 0.05 | $ | 106,121 | 15 | 0.06 | ||||||||||||||||||||||||||||||||||||||||||||
| Money market and savings | 137,676 | 8 | 0.03 | 136,094 | 9 | 0.03 | 134,029 | 8 | 0.03 | |||||||||||||||||||||||||||||||||||||||||||||||
| Time deposits | 16,292 | 9 | 0.21 | 17,094 | 10 | 0.23 | 18,213 | 13 | 0.28 | |||||||||||||||||||||||||||||||||||||||||||||||
| Total interest-bearing deposits (4) | 264,474 | 32 | 0.05 | 260,990 | 33 | 0.05 | 258,363 | 36 | 0.06 | |||||||||||||||||||||||||||||||||||||||||||||||
| Short-term borrowings | 6,433 | 9 | 0.55 | 5,360 | 9 | 0.68 | 6,168 | 15 | 0.98 | |||||||||||||||||||||||||||||||||||||||||||||||
| Long-term debt | 37,623 | 127 | 1.35 | 37,329 | 151 | 1.61 | 36,873 | 147 | 1.60 | |||||||||||||||||||||||||||||||||||||||||||||||
| Total interest-bearing liabilities | 308,530 | 168 | 0.22 | 303,679 | 193 | 0.25 | 301,404 | 198 | 0.26 | |||||||||||||||||||||||||||||||||||||||||||||||
| Noninterest-bearing deposits (4) | 146,492 | 141,738 | 137,892 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other liabilities | 11,409 | 11,915 | 10,813 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shareholders’ equity | 68,480 | 69,353 | 68,665 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 534,911 | $ | 526,685 | $ | 518,774 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Average interest-rate spread | 2.68 | 2.73 | 2.80 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net interest income/ net interest margin - taxable equivalent | $ | 3,267 | 2.76 | % | $ | 3,261 | 2.81 | % | $ | 3,273 | 2.88 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Taxable-equivalent adjustment | $ | 24 | $ | 28 | $ | 28 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Applicable ratios are annualized. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (1) Excludes basis adjustments for fair value hedges. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (2) Amounts are on a taxable-equivalent basis utilizing the federal income tax rate of 21% for the periods presented. Interest income includes certain fees, deferred costs, and dividends. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (3) Includes AFS and HTM securities. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (4) Total deposit costs were 0.03%, 0.03%, and 0.04% for the three months ended December 31, 2021, September 30, 2021, and June 30, 2021, respectively. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Truist Financial Corporation 9
| Average Balances and Rates - Year-To-Date | ||||||||||||||||||||||||||||||||||||||
| Year-to-Date | ||||||||||||||||||||||||||||||||||||||
| June 30, 2022 | June 30, 2021 | |||||||||||||||||||||||||||||||||||||
| (1) | (2) Interest | (2) | (1) | (2) Interest | (2) | |||||||||||||||||||||||||||||||||
| Average | Income/ | Yields/ | Average | Income/ | Yields/ | |||||||||||||||||||||||||||||||||
| (Dollars in millions) | Balances | Expense | Rates | Balances | Expense | Rates | ||||||||||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||||||||||||
| Securities at amortized cost (3): | ||||||||||||||||||||||||||||||||||||||
| U.S. Treasury | $ | 10,219 | $ | 40 | 0.79 | % | $ | 5,435 | $ | 20 | 0.76 | % | ||||||||||||||||||||||||||
| U.S. government-sponsored entities (GSE) | 685 | 7 | 2.11 | 1,840 | 22 | 2.33 | ||||||||||||||||||||||||||||||||
| Mortgage-backed securities issued by GSE | 135,185 | 1,215 | 1.80 | 121,228 | 892 | 1.47 | ||||||||||||||||||||||||||||||||
| States and political subdivisions | 372 | 7 | 3.77 | 441 | 8 | 3.54 | ||||||||||||||||||||||||||||||||
| Non-agency mortgage-backed | 4,161 | 47 | 2.27 | 8 | — | 2.45 | ||||||||||||||||||||||||||||||||
| Other | 51 | 1 | 3.22 | 32 | — | 1.90 | ||||||||||||||||||||||||||||||||
| Total securities | 150,673 | 1,317 | 1.75 | 128,984 | 942 | 1.46 | ||||||||||||||||||||||||||||||||
| Loans and leases: | ||||||||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||||||||
| Commercial and industrial | 142,233 | 2,161 | 3.06 | 139,776 | 2,165 | 3.12 | ||||||||||||||||||||||||||||||||
| CRE | 23,029 | 361 | 3.12 | 25,926 | 372 | 2.87 | ||||||||||||||||||||||||||||||||
| Commercial construction | 5,152 | 78 | 3.26 | 6,457 | 93 | 2.99 | ||||||||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||||||||
| Residential mortgage | 48,610 | 868 | 3.57 | 44,708 | 981 | 4.39 | ||||||||||||||||||||||||||||||||
| Residential home equity and direct | 25,004 | 659 | 5.31 | 25,447 | 729 | 5.78 | ||||||||||||||||||||||||||||||||
| Indirect auto | 26,293 | 719 | 5.51 | 26,403 | 835 | 6.38 | ||||||||||||||||||||||||||||||||
| Indirect other | 11,167 | 349 | 6.30 | 10,823 | 372 | 6.92 | ||||||||||||||||||||||||||||||||
| Student | 6,489 | 129 | 4.02 | 7,457 | 145 | 3.93 | ||||||||||||||||||||||||||||||||
| Credit card | 4,705 | 209 | 8.94 | 4,598 | 205 | 8.99 | ||||||||||||||||||||||||||||||||
| Total loans and leases held for investment | 292,682 | 5,533 | 3.81 | 291,595 | 5,897 | 4.07 | ||||||||||||||||||||||||||||||||
| Loans held for sale | 3,511 | 61 | 3.47 | 4,640 | 60 | 2.58 | ||||||||||||||||||||||||||||||||
| Total loans and leases | 296,193 | 5,594 | 3.80 | 296,235 | 5,957 | 4.05 | ||||||||||||||||||||||||||||||||
| Interest earning trading assets | 5,956 | 98 | 3.30 | 4,902 | 69 | 2.81 | ||||||||||||||||||||||||||||||||
| Other earning assets | 20,074 | 75 | 0.75 | 19,515 | 25 | 0.27 | ||||||||||||||||||||||||||||||||
| Total earning assets | 472,896 | 7,084 | 3.01 | 449,636 | 6,993 | 3.13 | ||||||||||||||||||||||||||||||||
| Nonearning assets | 65,391 | 64,196 | ||||||||||||||||||||||||||||||||||||
| Total assets | $ | 538,287 | $ | 513,832 | ||||||||||||||||||||||||||||||||||
| Liabilities and Shareholders’ Equity | ||||||||||||||||||||||||||||||||||||||
| Interest-bearing deposits: | ||||||||||||||||||||||||||||||||||||||
| Interest checking | $ | 112,268 | 57 | 0.10 | $ | 105,436 | 30 | 0.06 | ||||||||||||||||||||||||||||||
| Money market and savings | 145,085 | 61 | 0.08 | 131,680 | 18 | 0.03 | ||||||||||||||||||||||||||||||||
| Time deposits | 14,885 | 13 | 0.18 | 19,379 | 35 | 0.36 | ||||||||||||||||||||||||||||||||
| Total interest-bearing deposits (4) | 272,238 | 131 | 0.10 | 256,495 | 83 | 0.07 | ||||||||||||||||||||||||||||||||
| Short-term borrowings | 8,289 | 40 | 0.98 | 6,448 | 29 | 0.90 | ||||||||||||||||||||||||||||||||
| Long-term debt | 33,289 | 269 | 1.61 | 37,344 | 295 | 1.58 | ||||||||||||||||||||||||||||||||
| Total interest-bearing liabilities | 313,816 | 440 | 0.28 | 300,287 | 407 | 0.27 | ||||||||||||||||||||||||||||||||
| Noninterest-bearing deposits (4) | 147,279 | 133,261 | ||||||||||||||||||||||||||||||||||||
| Other liabilities | 12,052 | 10,932 | ||||||||||||||||||||||||||||||||||||
| Shareholders’ equity | 65,140 | 69,352 | ||||||||||||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 538,287 | $ | 513,832 | ||||||||||||||||||||||||||||||||||
| Average interest-rate spread | 2.73 | 2.86 | ||||||||||||||||||||||||||||||||||||
| Net interest income/ net interest margin - taxable equivalent | $ | 6,644 | 2.83 | % | $ | 6,586 | 2.95 | % | ||||||||||||||||||||||||||||||
| Taxable-equivalent adjustment | $ | 54 | $ | 56 | ||||||||||||||||||||||||||||||||||
| Applicable ratios are annualized. | ||||||||||||||||||||||||||||||||||||||
| (1) Excludes basis adjustments for fair value hedges. | ||||||||||||||||||||||||||||||||||||||
| (2) Amounts are on a taxable-equivalent basis utilizing the federal income tax rate of 21% for the periods presented. Interest income includes certain fees, deferred costs, and dividends. | ||||||||||||||||||||||||||||||||||||||
| (3) Includes AFS and HTM securities. | ||||||||||||||||||||||||||||||||||||||
| (4) Total deposit costs were 0.06% and 0.04% for the year ended June 30, 2022 and 2021, respectively. | ||||||||||||||||||||||||||||||||||||||
10 Truist Financial Corporation
| Credit Quality | ||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||||
| Nonperforming Assets | ||||||||||||||||||||||||||||||||
| Nonaccrual loans and leases: | ||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||
| Commercial and industrial | $ | 393 | $ | 330 | $ | 394 | $ | 423 | $ | 402 | ||||||||||||||||||||||
| CRE | 19 | 27 | 29 | 20 | 25 | |||||||||||||||||||||||||||
| Commercial construction | — | — | 7 | 7 | 12 | |||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||
| Residential mortgage | 269 | 315 | 296 | 306 | 302 | |||||||||||||||||||||||||||
| Residential home equity and direct | 159 | 141 | 141 | 146 | 165 | |||||||||||||||||||||||||||
| Indirect auto | 244 | 227 | 218 | 172 | 148 | |||||||||||||||||||||||||||
| Indirect other | 6 | 4 | 5 | 6 | 6 | |||||||||||||||||||||||||||
| Total nonaccrual loans and leases held for investment | 1,090 | 1,044 | 1,090 | 1,080 | 1,060 | |||||||||||||||||||||||||||
| Loans held for sale | 33 | 39 | 22 | 76 | 78 | |||||||||||||||||||||||||||
| Total nonaccrual loans and leases | 1,123 | 1,083 | 1,112 | 1,156 | 1,138 | |||||||||||||||||||||||||||
| Foreclosed real estate | 3 | 3 | 8 | 9 | 13 | |||||||||||||||||||||||||||
| Other foreclosed property | 47 | 49 | 43 | 39 | 41 | |||||||||||||||||||||||||||
| Total nonperforming assets | $ | 1,173 | $ | 1,135 | $ | 1,163 | $ | 1,204 | $ | 1,192 | ||||||||||||||||||||||
| Troubled Debt Restructurings (TDRs) | ||||||||||||||||||||||||||||||||
| Performing TDRs: | ||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||
| Commercial and industrial | $ | 105 | $ | 104 | $ | 147 | $ | 200 | $ | 202 | ||||||||||||||||||||||
| CRE | 5 | 5 | 5 | 8 | 24 | |||||||||||||||||||||||||||
| Commercial construction | 1 | 1 | — | — | — | |||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||
| Residential mortgage - government guaranteed | 761 | 622 | 480 | 507 | 520 | |||||||||||||||||||||||||||
| Residential mortgage - nonguaranteed | 281 | 244 | 212 | 205 | 207 | |||||||||||||||||||||||||||
| Residential home equity and direct | 84 | 91 | 98 | 105 | 107 | |||||||||||||||||||||||||||
| Indirect auto | 401 | 392 | 389 | 390 | 389 | |||||||||||||||||||||||||||
| Indirect other | 6 | 6 | 7 | 7 | 7 | |||||||||||||||||||||||||||
| Student - nonguaranteed | 27 | 25 | 25 | 23 | 13 | |||||||||||||||||||||||||||
| Credit card | 22 | 25 | 27 | 30 | 32 | |||||||||||||||||||||||||||
| Total performing TDRs | 1,693 | 1,515 | 1,390 | 1,475 | 1,501 | |||||||||||||||||||||||||||
| Nonperforming TDRs | 204 | 189 | 152 | 159 | 190 | |||||||||||||||||||||||||||
| Total TDRs | $ | 1,897 | $ | 1,704 | $ | 1,542 | $ | 1,634 | $ | 1,691 | ||||||||||||||||||||||
| Loans 90 Days or More Past Due and Still Accruing | ||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||
| Commercial and industrial | $ | 27 | $ | 22 | $ | 13 | $ | 18 | $ | 14 | ||||||||||||||||||||||
| CRE | 3 | — | — | — | — | |||||||||||||||||||||||||||
| Commercial construction | 3 | — | — | — | — | |||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||
| Residential mortgage - government guaranteed | 884 | 996 | 978 | 823 | 929 | |||||||||||||||||||||||||||
| Residential mortgage - nonguaranteed | 27 | 31 | 31 | 29 | 47 | |||||||||||||||||||||||||||
| Residential home equity and direct | 10 | 12 | 9 | 7 | 7 | |||||||||||||||||||||||||||
| Indirect auto | 1 | 1 | 1 | 2 | 2 | |||||||||||||||||||||||||||
| Indirect other | 3 | 2 | 3 | 2 | 1 | |||||||||||||||||||||||||||
| Student - government guaranteed | 796 | 818 | 864 | 965 | 1,043 | |||||||||||||||||||||||||||
| Student - nonguaranteed | 5 | 4 | 4 | 3 | 3 | |||||||||||||||||||||||||||
| Credit card | 28 | 28 | 27 | 23 | 22 | |||||||||||||||||||||||||||
| Total loans 90 days past due and still accruing | $ | 1,787 | $ | 1,914 | $ | 1,930 | $ | 1,872 | $ | 2,068 | ||||||||||||||||||||||
| Loans 30-89 Days Past Due | ||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||
| Commercial and industrial | $ | 223 | $ | 280 | $ | 130 | $ | 135 | $ | 146 | ||||||||||||||||||||||
| CRE | 10 | 13 | 20 | 4 | 7 | |||||||||||||||||||||||||||
| Commercial construction | 4 | 1 | 2 | 2 | 1 | |||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||
| Residential mortgage - government guaranteed | 233 | 216 | 256 | 264 | 307 | |||||||||||||||||||||||||||
| Residential mortgage - nonguaranteed | 302 | 326 | 258 | 231 | 236 | |||||||||||||||||||||||||||
| Residential home equity and direct | 156 | 142 | 107 | 81 | 73 | |||||||||||||||||||||||||||
| Indirect auto | 584 | 529 | 607 | 560 | 428 | |||||||||||||||||||||||||||
| Indirect other | 78 | 65 | 64 | 53 | 47 | |||||||||||||||||||||||||||
| Student - government guaranteed | 447 | 476 | 549 | 451 | 543 | |||||||||||||||||||||||||||
| Student - nonguaranteed | 6 | 6 | 6 | 5 | 5 | |||||||||||||||||||||||||||
| Credit card | 48 | 47 | 45 | 37 | 31 | |||||||||||||||||||||||||||
| Total loans 30-89 days past due | $ | 2,091 | $ | 2,101 | $ | 2,044 | $ | 1,823 | $ | 1,824 | ||||||||||||||||||||||
Truist Financial Corporation 11
| As of/For the Quarter Ended | ||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||||
| Allowance for Credit Losses | ||||||||||||||||||||||||||||||||
| Beginning balance | $ | 4,423 | $ | 4,695 | $ | 4,978 | $ | 5,436 | $ | 6,011 | ||||||||||||||||||||||
| Provision for credit losses | 171 | (95) | (103) | (324) | (434) | |||||||||||||||||||||||||||
| Charge-offs: | ||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||
| Commercial and industrial | (17) | (31) | (54) | (57) | (53) | |||||||||||||||||||||||||||
| CRE | (1) | (1) | (5) | (1) | — | |||||||||||||||||||||||||||
| Commercial construction | — | (1) | — | — | — | |||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||
| Residential mortgage | (2) | (2) | (1) | (7) | (4) | |||||||||||||||||||||||||||
| Residential home equity and direct | (85) | (58) | (51) | (51) | (57) | |||||||||||||||||||||||||||
| Indirect auto | (77) | (102) | (89) | (73) | (69) | |||||||||||||||||||||||||||
| Indirect other | (18) | (19) | (16) | (13) | (11) | |||||||||||||||||||||||||||
| Student | (4) | (6) | (12) | (6) | (3) | |||||||||||||||||||||||||||
| Credit card | (40) | (41) | (37) | (31) | (42) | |||||||||||||||||||||||||||
| Total charge-offs | (244) | (261) | (265) | (239) | (239) | |||||||||||||||||||||||||||
| Recoveries: | ||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||
| Commercial and industrial | 13 | 17 | 23 | 42 | 23 | |||||||||||||||||||||||||||
| CRE | 6 | 1 | — | 1 | 4 | |||||||||||||||||||||||||||
| Commercial construction | 1 | 1 | 1 | 1 | 1 | |||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||
| Residential mortgage | 4 | 6 | 2 | 3 | 5 | |||||||||||||||||||||||||||
| Residential home equity and direct | 20 | 20 | 21 | 20 | 20 | |||||||||||||||||||||||||||
| Indirect auto | 26 | 23 | 21 | 22 | 27 | |||||||||||||||||||||||||||
| Indirect other | 6 | 6 | 6 | 5 | 7 | |||||||||||||||||||||||||||
| Student | — | — | — | 1 | — | |||||||||||||||||||||||||||
| Credit card | 9 | 9 | 9 | 9 | 10 | |||||||||||||||||||||||||||
| Total recoveries | 85 | 83 | 83 | 104 | 97 | |||||||||||||||||||||||||||
| Net charge-offs | (159) | (178) | (182) | (135) | (142) | |||||||||||||||||||||||||||
| Other | (1) | 1 | 2 | 1 | 1 | |||||||||||||||||||||||||||
| Ending balance | $ | 4,434 | $ | 4,423 | $ | 4,695 | $ | 4,978 | $ | 5,436 | ||||||||||||||||||||||
| Allowance for Credit Losses: | ||||||||||||||||||||||||||||||||
| Allowance for loan and lease losses | $ | 4,187 | $ | 4,170 | $ | 4,435 | $ | 4,702 | $ | 5,121 | ||||||||||||||||||||||
| Reserve for unfunded lending commitments (RUFC) | 247 | 253 | 260 | 276 | 315 | |||||||||||||||||||||||||||
| Allowance for credit losses | $ | 4,434 | $ | 4,423 | $ | 4,695 | $ | 4,978 | $ | 5,436 | ||||||||||||||||||||||
12 Truist Financial Corporation
| As of/For the Year-to-Date | ||||||||||||||||||||||||||||||||
| Period Ended June 30 | ||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2021 | ||||||||||||||||||||||||||||||
| Allowance for Credit Losses | ||||||||||||||||||||||||||||||||
| Beginning balance | $ | 4,695 | $ | 6,199 | ||||||||||||||||||||||||||||
| Provision for credit losses | 76 | (386) | ||||||||||||||||||||||||||||||
| Charge-offs: | ||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||
| Commercial and industrial | (48) | (132) | ||||||||||||||||||||||||||||||
| CRE | (2) | (4) | ||||||||||||||||||||||||||||||
| Commercial construction | (1) | (2) | ||||||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||
| Residential mortgage | (4) | (15) | ||||||||||||||||||||||||||||||
| Residential home equity and direct | (143) | (112) | ||||||||||||||||||||||||||||||
| Indirect auto | (179) | (174) | ||||||||||||||||||||||||||||||
| Indirect other | (37) | (28) | ||||||||||||||||||||||||||||||
| Student | (10) | (6) | ||||||||||||||||||||||||||||||
| Credit card | (81) | (82) | ||||||||||||||||||||||||||||||
| Total charge-offs | (505) | (555) | ||||||||||||||||||||||||||||||
| Recoveries: | ||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||
| Commercial and industrial | 30 | 42 | ||||||||||||||||||||||||||||||
| CRE | 7 | 5 | ||||||||||||||||||||||||||||||
| Commercial construction | 2 | 2 | ||||||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||
| Residential mortgage | 10 | 7 | ||||||||||||||||||||||||||||||
| Residential home equity and direct | 40 | 38 | ||||||||||||||||||||||||||||||
| Indirect auto | 49 | 49 | ||||||||||||||||||||||||||||||
| Indirect other | 12 | 13 | ||||||||||||||||||||||||||||||
| Credit card | 18 | 19 | ||||||||||||||||||||||||||||||
| Total recoveries | 168 | 175 | ||||||||||||||||||||||||||||||
| Net charge-offs | (337) | (380) | ||||||||||||||||||||||||||||||
| Other | — | 3 | ||||||||||||||||||||||||||||||
| Ending balance | $ | 4,434 | $ | 5,436 | ||||||||||||||||||||||||||||
| As of/For the Quarter Ended | ||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| 2022 | 2022 | 2021 | 2021 | 2021 | ||||||||||||||||||||||||||||
| Asset Quality Ratios | ||||||||||||||||||||||||||||||||
| Loans 30-89 days past due and still accruing as a percentage of loans and leases | 0.69 | % | 0.72 | % | 0.71 | % | 0.64 | % | 0.64 | % | ||||||||||||||||||||||
| Loans 90 days or more past due and still accruing as a percentage of loans and leases | 0.59 | 0.66 | 0.67 | 0.66 | 0.72 | |||||||||||||||||||||||||||
| Nonperforming loans and leases as a percentage of loans and leases held for investment | 0.36 | 0.36 | 0.38 | 0.38 | 0.37 | |||||||||||||||||||||||||||
| Nonperforming loans and leases as a percentage of loans and leases (1) | 0.37 | 0.37 | 0.38 | 0.40 | 0.39 | |||||||||||||||||||||||||||
| Nonperforming assets as a percentage of: | ||||||||||||||||||||||||||||||||
| Total assets (1) | 0.22 | 0.21 | 0.21 | 0.23 | 0.23 | |||||||||||||||||||||||||||
| Loans and leases plus foreclosed property | 0.38 | 0.38 | 0.39 | 0.40 | 0.39 | |||||||||||||||||||||||||||
| Net charge-offs as a percentage of average loans and leases | 0.22 | 0.25 | 0.25 | 0.19 | 0.20 | |||||||||||||||||||||||||||
| Allowance for loan and lease losses as a percentage of loans and leases | 1.38 | 1.44 | 1.53 | 1.65 | 1.79 | |||||||||||||||||||||||||||
| Ratio of allowance for loan and lease losses to: | ||||||||||||||||||||||||||||||||
| Net charge-offs | 6.54X | 5.78X | 6.14X | 8.79X | 8.98X | |||||||||||||||||||||||||||
| Nonperforming loans and leases | 3.84X | 3.99X | 4.07X | 4.35X | 4.83X | |||||||||||||||||||||||||||
| Asset Quality Ratios (Excluding PPP and other Government Guaranteed) | ||||||||||||||||||||||||||||||||
| Loans 90 days or more past due and still accruing as a percentage of loans and leases | 0.04 | % | 0.04 | % | 0.03 | % | 0.03 | % | 0.04 | % | ||||||||||||||||||||||
| Applicable ratios are annualized. | ||||||||||||||||||||||||||||||||
(1)Includes loans held for sale. | ||||||||||||||||||||||||||||||||
Truist Financial Corporation 13
| June 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||
| Past Due 30-89 | Past Due 90+ | |||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | Current Status | Days | Days | Total | ||||||||||||||||||||||||||||||||||||||||
| Troubled Debt Restructurings | ||||||||||||||||||||||||||||||||||||||||||||
| Performing TDRs: (1) | ||||||||||||||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||||||||||||||
| Commercial and industrial | $ | 90 | 85.7 | % | $ | 14 | 13.3 | % | $ | 1 | 1.0 | % | $ | 105 | ||||||||||||||||||||||||||||||
| CRE | 5 | 100.0 | — | — | — | — | 5 | |||||||||||||||||||||||||||||||||||||
| Commercial construction | 1 | 100.0 | — | — | — | — | 1 | |||||||||||||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||||||||||||||
| Residential mortgage - government guaranteed | 377 | 49.5 | 79 | 10.4 | 305 | 40.1 | 761 | |||||||||||||||||||||||||||||||||||||
| Residential mortgage - nonguaranteed | 241 | 85.7 | 26 | 9.3 | 14 | 5.0 | 281 | |||||||||||||||||||||||||||||||||||||
| Residential home equity and direct | 80 | 95.3 | 4 | 4.7 | — | — | 84 | |||||||||||||||||||||||||||||||||||||
| Indirect auto | 335 | 83.5 | 66 | 16.5 | — | — | 401 | |||||||||||||||||||||||||||||||||||||
| Indirect other | 5 | 83.3 | 1 | 16.7 | — | — | 6 | |||||||||||||||||||||||||||||||||||||
| Student - nonguaranteed | 25 | 92.6 | 1 | 3.7 | 1 | 3.7 | 27 | |||||||||||||||||||||||||||||||||||||
| Credit card | 19 | 86.4 | 2 | 9.1 | 1 | 4.5 | 22 | |||||||||||||||||||||||||||||||||||||
| Total performing TDRs (1) | 1,178 | 69.6 | 193 | 11.4 | 322 | 19.0 | 1,693 | |||||||||||||||||||||||||||||||||||||
| Nonperforming TDRs (2) | 76 | 37.3 | 26 | 12.7 | 102 | 50.0 | 204 | |||||||||||||||||||||||||||||||||||||
| Total TDRs (1)(2) | $ | 1,254 | 66.2 | % | $ | 219 | 11.5 | % | $ | 424 | 22.3 | % | $ | 1,897 | ||||||||||||||||||||||||||||||
(1)Past due performing TDRs are included in past due disclosures. | ||||||||||||||||||||||||||||||||||||||||||||
(2)Nonperforming TDRs are included in nonaccrual loan disclosures. | ||||||||||||||||||||||||||||||||||||||||||||
| Quarter Ended | ||||||||||||||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||||||||||||||
| 2022 | 2022 | 2021 | 2021 | 2021 | ||||||||||||||||||||||||||||||||||||||||
| Net Charge-offs as a Percentage of Average Loans and Leases: | ||||||||||||||||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||||||||||||||
| Commercial and industrial | 0.01 | % | 0.04 | % | 0.09 | % | 0.04 | % | 0.09 | % | ||||||||||||||||||||||||||||||||||
| CRE | (0.10) | 0.01 | 0.07 | — | (0.05) | |||||||||||||||||||||||||||||||||||||||
| Commercial construction | (0.08) | (0.02) | (0.10) | (0.06) | (0.06) | |||||||||||||||||||||||||||||||||||||||
| Consumer: | ||||||||||||||||||||||||||||||||||||||||||||
| Residential mortgage | (0.02) | (0.03) | (0.02) | 0.04 | (0.01) | |||||||||||||||||||||||||||||||||||||||
| Residential home equity and direct | 1.04 | 0.61 | 0.49 | 0.49 | 0.59 | |||||||||||||||||||||||||||||||||||||||
| Indirect auto | 0.77 | 1.23 | 1.01 | 0.75 | 0.63 | |||||||||||||||||||||||||||||||||||||||
| Indirect other | 0.43 | 0.48 | 0.39 | 0.26 | 0.17 | |||||||||||||||||||||||||||||||||||||||
| Student | 0.30 | 0.33 | 0.65 | 0.31 | 0.16 | |||||||||||||||||||||||||||||||||||||||
| Credit card | 2.63 | 2.77 | 2.31 | 1.90 | 2.75 | |||||||||||||||||||||||||||||||||||||||
| Total loans and leases | 0.22 | 0.25 | 0.25 | 0.19 | 0.20 | |||||||||||||||||||||||||||||||||||||||
| Applicable ratios are annualized. | ||||||||||||||||||||||||||||||||||||||||||||
| Credit Quality - Allowance with Fair Value Marks | |||||||||||||||||||||||||||||
| As of/For the Quarter Ended | |||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | |||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2022 | 2021 | 2021 | 2021 | ||||||||||||||||||||||||
| ALLL | $ | 4,187 | $ | 4,170 | $ | 4,435 | $ | 4,702 | $ | 5,121 | |||||||||||||||||||
| Unamortized fair value mark (1) | 924 | 1,119 | 1,323 | 1,540 | 1,777 | ||||||||||||||||||||||||
| Allowance plus unamortized fair value mark | $ | 5,111 | $ | 5,289 | $ | 5,758 | $ | 6,242 | $ | 6,898 | |||||||||||||||||||
| Loans and leases held for investment | $ | 303,662 | $ | 290,081 | $ | 289,513 | $ | 285,522 | $ | 286,485 | |||||||||||||||||||
| Unamortized fair value mark (1) | 924 | 1,119 | 1,323 | 1,540 | 1,777 | ||||||||||||||||||||||||
| Gross loans and leases | $ | 304,586 | $ | 291,200 | $ | 290,836 | $ | 287,062 | $ | 288,262 | |||||||||||||||||||
| Allowance for loan and lease losses as a percentage of loans and leases - GAAP | 1.38 | % | 1.44 | % | 1.53 | % | 1.65 | % | 1.79 | % | |||||||||||||||||||
| Allowance for loan and lease losses and unamortized fair value mark as a percentage of gross loans and leases - Adjusted (1) (2) | 1.68 | 1.82 | 1.98 | 2.17 | 2.39 | ||||||||||||||||||||||||
(1)Unamortized fair value mark includes credit, interest rate, and liquidity components.
(2)Allowance for loan and lease losses and unamortized fair value mark as a percentage of gross loans and leases is a non-GAAP measurement of credit reserves that is calculated by adjusting the ALLL and loans and leases held for investment by the unamortized fair value mark. Truist’s management uses these measures to assess loss absorption capacity.
14 Truist Financial Corporation
| Rollforward of Intangible Assets and Selected Fair Value Marks (1) | |||||||||||||||||||||||||||||
| As of/For the Quarter Ended | |||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | |||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2022 | 2021 | 2021 | 2021 | ||||||||||||||||||||||||
| Loans and Leases (2) | |||||||||||||||||||||||||||||
| Beginning balance unamortized fair value mark | $ | (1,119) | $ | (1,323) | $ | (1,540) | $ | (1,777) | $ | (2,067) | |||||||||||||||||||
| Accretion | 189 | 191 | 217 | 233 | 285 | ||||||||||||||||||||||||
| Purchase accounting adjustments and other activity | 6 | 13 | — | 4 | 5 | ||||||||||||||||||||||||
| Ending balance | $ | (924) | $ | (1,119) | $ | (1,323) | $ | (1,540) | $ | (1,777) | |||||||||||||||||||
| Core deposit and other intangible assets | |||||||||||||||||||||||||||||
| Beginning balance | $ | 3,693 | $ | 3,408 | $ | 2,930 | $ | 2,665 | $ | 2,825 | |||||||||||||||||||
| Additions - acquisitions | — | 430 | 647 | 418 | — | ||||||||||||||||||||||||
| Amortization of intangibles | (143) | (137) | (143) | (145) | (142) | ||||||||||||||||||||||||
| Amortization in net occupancy expense | (5) | (8) | (3) | (4) | (3) | ||||||||||||||||||||||||
| Purchase accounting adjustments and other activity | (10) | — | (23) | (4) | (15) | ||||||||||||||||||||||||
| Ending balance | $ | 3,535 | $ | 3,693 | $ | 3,408 | $ | 2,930 | $ | 2,665 | |||||||||||||||||||
| Deposits (3) | |||||||||||||||||||||||||||||
| Beginning balance unamortized fair value mark | $ | (5) | $ | (7) | $ | (9) | $ | (12) | $ | (15) | |||||||||||||||||||
| Amortization | 2 | 2 | 2 | 3 | 3 | ||||||||||||||||||||||||
| Ending balance | $ | (3) | $ | (5) | $ | (7) | $ | (9) | $ | (12) | |||||||||||||||||||
| Long-Term Debt (3) | |||||||||||||||||||||||||||||
| Beginning balance unamortized fair value mark | $ | (122) | $ | (139) | $ | (157) | $ | (176) | $ | (196) | |||||||||||||||||||
| Amortization | 13 | 17 | 18 | 19 | 20 | ||||||||||||||||||||||||
| Ending balance | $ | (109) | $ | (122) | $ | (139) | $ | (157) | $ | (176) | |||||||||||||||||||
(1)Includes only selected information and does not represent all purchase accounting adjustments.
(2)Purchase accounting marks on loans and leases includes credit, interest and liquidity components, and are generally recognized using the level-yield or straight-line method over the remaining life of the individual loans or recognized in full in the event of prepayment.
(3)Purchase accounting marks on liabilities represents interest rate marks on time deposits and long-term debt and are recognized using the level-yield method over the term of the liability.
Truist Financial Corporation 15
| Segment Financial Performance - Preliminary | ||||||||||||||||||||||||||||||||
| Quarter Ended | ||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||||
| Consumer Banking and Wealth | ||||||||||||||||||||||||||||||||
| Net interest income (expense) | $ | 1,567 | $ | 1,528 | $ | 1,630 | $ | 1,666 | $ | 1,687 | ||||||||||||||||||||||
| Net intersegment interest income (expense) | 707 | 654 | 597 | 485 | 385 | |||||||||||||||||||||||||||
| Segment net interest income | 2,274 | 2,182 | 2,227 | 2,151 | 2,072 | |||||||||||||||||||||||||||
| Allocated provision for credit losses | 199 | 73 | 59 | (5) | (4) | |||||||||||||||||||||||||||
| Noninterest income | 892 | 950 | 992 | 1,028 | 925 | |||||||||||||||||||||||||||
| Noninterest expense | 1,954 | 1,908 | 1,971 | 1,985 | 1,945 | |||||||||||||||||||||||||||
| Income (loss) before income taxes | 1,013 | 1,151 | 1,189 | 1,199 | 1,056 | |||||||||||||||||||||||||||
| Provision (benefit) for income taxes | 240 | 278 | 244 | 265 | 257 | |||||||||||||||||||||||||||
| Segment net income (loss) | $ | 773 | $ | 873 | $ | 945 | $ | 934 | $ | 799 | ||||||||||||||||||||||
| Corporate and Commercial Banking | ||||||||||||||||||||||||||||||||
| Net interest income (expense) | $ | 1,277 | $ | 1,094 | $ | 1,106 | $ | 1,125 | $ | 1,182 | ||||||||||||||||||||||
| Net intersegment interest income (expense) | 57 | 176 | 194 | 158 | 114 | |||||||||||||||||||||||||||
| Segment net interest income | 1,334 | 1,270 | 1,300 | 1,283 | 1,296 | |||||||||||||||||||||||||||
| Allocated provision for credit losses | (28) | (150) | (183) | (265) | (399) | |||||||||||||||||||||||||||
| Noninterest income | 636 | 619 | 789 | 752 | 808 | |||||||||||||||||||||||||||
| Noninterest expense | 781 | 756 | 800 | 806 | 828 | |||||||||||||||||||||||||||
| Income (loss) before income taxes | 1,217 | 1,283 | 1,472 | 1,494 | 1,675 | |||||||||||||||||||||||||||
| Provision (benefit) for income taxes | 263 | 280 | 296 | 314 | 369 | |||||||||||||||||||||||||||
| Segment net income (loss) | $ | 954 | $ | 1,003 | $ | 1,176 | $ | 1,180 | $ | 1,306 | ||||||||||||||||||||||
| Insurance Holdings | ||||||||||||||||||||||||||||||||
| Net interest income (expense) | $ | 30 | $ | 24 | $ | 23 | $ | 27 | $ | 25 | ||||||||||||||||||||||
| Net intersegment interest income (expense) | (2) | — | — | 1 | — | |||||||||||||||||||||||||||
| Segment net interest income | 28 | 24 | 23 | 28 | 25 | |||||||||||||||||||||||||||
| Allocated provision for credit losses | 1 | — | (1) | 1 | (1) | |||||||||||||||||||||||||||
| Noninterest income | 833 | 738 | 681 | 652 | 698 | |||||||||||||||||||||||||||
| Noninterest expense | 624 | 560 | 546 | 537 | 515 | |||||||||||||||||||||||||||
| Income (loss) before income taxes | 236 | 202 | 159 | 142 | 209 | |||||||||||||||||||||||||||
| Provision (benefit) for income taxes | 58 | 50 | 32 | 31 | 50 | |||||||||||||||||||||||||||
| Segment net income (loss) | $ | 178 | $ | 152 | $ | 127 | $ | 111 | $ | 159 | ||||||||||||||||||||||
| Other, Treasury & Corporate (1) | ||||||||||||||||||||||||||||||||
| Net interest income (expense) | $ | 533 | $ | 537 | $ | 484 | $ | 415 | $ | 351 | ||||||||||||||||||||||
| Net intersegment interest income (expense) | (762) | (830) | (791) | (644) | (499) | |||||||||||||||||||||||||||
| Segment net interest income | (229) | (293) | (307) | (229) | (148) | |||||||||||||||||||||||||||
| Allocated provision for credit losses | (1) | (18) | 22 | (55) | (30) | |||||||||||||||||||||||||||
| Noninterest income | (113) | (165) | (139) | (67) | (26) | |||||||||||||||||||||||||||
| Noninterest expense | 221 | 450 | 383 | 467 | 723 | |||||||||||||||||||||||||||
| Income (loss) before income taxes | (562) | (890) | (851) | (708) | (867) | |||||||||||||||||||||||||||
| Provision (benefit) for income taxes | (189) | (278) | (205) | (187) | (261) | |||||||||||||||||||||||||||
| Segment net income (loss) | $ | (373) | $ | (612) | $ | (646) | $ | (521) | $ | (606) | ||||||||||||||||||||||
| Total Truist Financial Corporation | ||||||||||||||||||||||||||||||||
| Net interest income (expense) | $ | 3,407 | $ | 3,183 | $ | 3,243 | $ | 3,233 | $ | 3,245 | ||||||||||||||||||||||
| Net intersegment interest income (expense) | — | — | — | — | — | |||||||||||||||||||||||||||
| Segment net interest income | 3,407 | 3,183 | 3,243 | 3,233 | 3,245 | |||||||||||||||||||||||||||
| Allocated provision for credit losses | 171 | (95) | (103) | (324) | (434) | |||||||||||||||||||||||||||
| Noninterest income | 2,248 | 2,142 | 2,323 | 2,365 | 2,405 | |||||||||||||||||||||||||||
| Noninterest expense | 3,580 | 3,674 | 3,700 | 3,795 | 4,011 | |||||||||||||||||||||||||||
| Income (loss) before income taxes | 1,904 | 1,746 | 1,969 | 2,127 | 2,073 | |||||||||||||||||||||||||||
| Provision (benefit) for income taxes | 372 | 330 | 367 | 423 | 415 | |||||||||||||||||||||||||||
| Net income | $ | 1,532 | $ | 1,416 | $ | 1,602 | $ | 1,704 | $ | 1,658 | ||||||||||||||||||||||
(1) Includes financial data from subsidiaries below the quantitative and qualitative thresholds requiring disclosure. | ||||||||||||||||||||||||||||||||
16 Truist Financial Corporation
| Capital Information - Five Quarter Trend | ||||||||||||||||||||||||||||||||
| As of/For the Quarter Ended | ||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| (Dollars in millions, except per share data, shares in thousands) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||||
| Selected Capital Information | (preliminary) | |||||||||||||||||||||||||||||||
| Risk-based capital: | ||||||||||||||||||||||||||||||||
| Common equity tier 1 | $ | 38,015 | $ | 37,225 | $ | 37,524 | $ | 38,859 | $ | 38,690 | ||||||||||||||||||||||
| Tier 1 | 44,686 | 43,895 | 44,194 | 45,529 | 45,360 | |||||||||||||||||||||||||||
| Total | 52,186 | 51,599 | 51,518 | 53,228 | 53,640 | |||||||||||||||||||||||||||
| Risk-weighted assets | 413,563 | 397,855 | 390,886 | 383,871 | 379,044 | |||||||||||||||||||||||||||
| Average quarterly assets for leverage ratio | 521,113 | 512,694 | 510,404 | 503,223 | 496,391 | |||||||||||||||||||||||||||
| Average quarterly assets for supplementary leverage ratio | 608,850 | 599,415 | 595,075 | 585,420 | 576,734 | |||||||||||||||||||||||||||
| Risk-based capital ratios: | ||||||||||||||||||||||||||||||||
| Common equity tier 1 | 9.2 | % | 9.4 | % | 9.6 | % | 10.1 | % | 10.2 | % | ||||||||||||||||||||||
| Tier 1 | 10.8 | 11.0 | 11.3 | 11.9 | 12.0 | |||||||||||||||||||||||||||
| Total | 12.6 | 13.0 | 13.2 | 13.9 | 14.2 | |||||||||||||||||||||||||||
| Leverage capital ratio | 8.6 | 8.6 | 8.7 | 9.0 | 9.1 | |||||||||||||||||||||||||||
| Supplementary leverage | 7.3 | 7.3 | 7.4 | 7.8 | 7.9 | |||||||||||||||||||||||||||
| Equity as a percentage of total assets | 11.6 | 12.0 | 12.8 | 13.0 | 13.1 | |||||||||||||||||||||||||||
| Common equity per common share | $ | 42.45 | $ | 43.82 | $ | 47.14 | $ | 46.62 | $ | 46.20 | ||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| (Dollars in millions, except per share data, shares in thousands) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||||
Calculations of Tangible Common Equity and Related Measures: (1) | ||||||||||||||||||||||||||||||||
| Total shareholders’ equity | $ | 62,999 | $ | 65,044 | $ | 69,271 | $ | 68,900 | $ | 68,336 | ||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||||||||
| Preferred stock | 6,673 | 6,673 | 6,673 | 6,673 | 6,673 | |||||||||||||||||||||||||||
| Noncontrolling interests | 24 | 23 | — | — | — | |||||||||||||||||||||||||||
| Intangible assets, net of deferred taxes | 29,095 | 29,229 | 28,772 | 27,066 | 26,296 | |||||||||||||||||||||||||||
| Tangible common equity | $ | 27,207 | $ | 29,119 | $ | 33,826 | $ | 35,161 | $ | 35,367 | ||||||||||||||||||||||
| Outstanding shares at end of period (in thousands) | 1,326,393 | 1,331,414 | 1,327,818 | 1,334,892 | 1,334,770 | |||||||||||||||||||||||||||
| Tangible Common Equity Per Common Share | $ | 20.51 | $ | 21.87 | $ | 25.47 | $ | 26.34 | $ | 26.50 | ||||||||||||||||||||||
(1)Tangible common equity and related measures are non-GAAP measures that exclude the impact of intangible assets, net of deferred taxes, and their related amortization. These measures are useful for evaluating the performance of a business consistently, whether acquired or developed internally. Truist’s management uses these measures to assess the quality of capital and returns relative to balance sheet risk. These measures are not necessarily comparable to similar measures that may be presented by other companies.
Truist Financial Corporation 17
| Selected Mortgage Banking Information & Additional Information | ||||||||||||||||||||||||||||||||
| As of/For the Quarter Ended | ||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | ||||||||||||||||||||||||||||
| (Dollars in millions, except per share data) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||||
| Residential Mortgage Income | ||||||||||||||||||||||||||||||||
| Residential mortgage production revenue | $ | 36 | $ | 52 | $ | 115 | $ | 139 | $ | 122 | ||||||||||||||||||||||
| Residential mortgage servicing income: | ||||||||||||||||||||||||||||||||
| Residential mortgage servicing revenue | 152 | 145 | 155 | 157 | 139 | |||||||||||||||||||||||||||
| Realization of expected residential MSR cash flows | (103) | (109) | (143) | (146) | (175) | |||||||||||||||||||||||||||
| Income statement impact of mortgage servicing rights valuation: | ||||||||||||||||||||||||||||||||
| MSRs fair value increase (decrease) | 254 | 350 | (25) | 77 | (188) | |||||||||||||||||||||||||||
| MSRs hedge gains (losses) | (265) | (349) | 57 | (48) | 219 | |||||||||||||||||||||||||||
| Net MSRs valuation | (11) | 1 | 32 | 29 | 31 | |||||||||||||||||||||||||||
| Total residential mortgage servicing income | $ | 38 | $ | 37 | $ | 44 | $ | 40 | $ | (5) | ||||||||||||||||||||||
| Total residential mortgage income | $ | 74 | $ | 89 | $ | 159 | $ | 179 | $ | 117 | ||||||||||||||||||||||
| Commercial Mortgage Income | ||||||||||||||||||||||||||||||||
| Commercial mortgage production revenue | $ | 21 | $ | 32 | $ | 40 | $ | 48 | $ | 40 | ||||||||||||||||||||||
| Commercial mortgage servicing income: | ||||||||||||||||||||||||||||||||
| Commercial mortgage servicing revenue | 17 | 17 | 18 | 17 | 17 | |||||||||||||||||||||||||||
| Realization of expected commercial MSR cash flows | (15) | (17) | (12) | (11) | (11) | |||||||||||||||||||||||||||
| Income statement impact of mortgage servicing rights valuation: | ||||||||||||||||||||||||||||||||
| MSRs fair value increase (decrease) | 8 | 9 | (1) | 1 | (4) | |||||||||||||||||||||||||||
| MSRs hedge gains (losses) | (5) | (9) | — | (1) | 5 | |||||||||||||||||||||||||||
| Net MSRs valuation | 3 | — | (1) | — | 1 | |||||||||||||||||||||||||||
| Total commercial mortgage servicing income | $ | 5 | $ | — | $ | 5 | $ | 6 | $ | 7 | ||||||||||||||||||||||
| Commercial mortgage income | $ | 26 | $ | 32 | $ | 45 | $ | 54 | $ | 47 | ||||||||||||||||||||||
Other Mortgage Banking Information | ||||||||||||||||||||||||||||||||
| Residential mortgage loan originations | $ | 11,330 | $ | 11,408 | $ | 14,458 | $ | 15,852 | $ | 14,301 | ||||||||||||||||||||||
| Residential mortgage servicing portfolio (1): | ||||||||||||||||||||||||||||||||
| Loans serviced for others | 209,504 | 195,737 | 196,011 | 198,119 | 178,004 | |||||||||||||||||||||||||||
| Bank-owned loans serviced | 53,341 | 50,927 | 50,716 | 50,427 | 46,031 | |||||||||||||||||||||||||||
| Total servicing portfolio | 262,845 | 246,664 | 246,727 | 248,546 | 224,035 | |||||||||||||||||||||||||||
| Weighted-average coupon rate on mortgage loans serviced for others | 3.42 | % | 3.41 | % | 3.44 | % | 3.49 | % | 3.66 | % | ||||||||||||||||||||||
| Weighted-average servicing fee on mortgage loans serviced for others | 0.30 | 0.31 | 0.31 | 0.31 | 0.31 | |||||||||||||||||||||||||||
| Additional Information | ||||||||||||||||||||||||||||||||
| Brokered deposits (2) | $ | 22,926 | $ | 19,092 | $ | 9,627 | $ | 10,980 | $ | 11,063 | ||||||||||||||||||||||
| NQDCP income (expense): | ||||||||||||||||||||||||||||||||
| Interest income | $ | 2 | $ | 19 | $ | 1 | $ | 2 | $ | 2 | ||||||||||||||||||||||
| Other income | (30) | (44) | (7) | 30 | 43 | |||||||||||||||||||||||||||
| Personnel expense | 28 | 25 | 6 | (32) | (45) | |||||||||||||||||||||||||||
| Total NQDCP income (expense) | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||||
| Fair value of derivatives, net | $ | (528) | $ | 631 | $ | 1,784 | $ | 2,375 | $ | 2,614 | ||||||||||||||||||||||
| CVA/DVA income (expense) included in investment banking and trading income | 12 | 24 | 12 | 16 | (12) | |||||||||||||||||||||||||||
| Common stock prices: | ||||||||||||||||||||||||||||||||
| High | 57.50 | 68.95 | 65.42 | 60.74 | 62.89 | |||||||||||||||||||||||||||
| Low | 44.75 | 56.19 | 54.73 | 51.87 | 52.61 | |||||||||||||||||||||||||||
| End of period | 47.43 | 56.70 | 58.55 | 58.65 | 55.50 | |||||||||||||||||||||||||||
| Banking offices | 2,117 | 2,112 | 2,517 | 2,518 | 2,557 | |||||||||||||||||||||||||||
| ATMs | 3,194 | 3,214 | 3,670 | 3,684 | 3,779 | |||||||||||||||||||||||||||
| FTEs (3) | 51,349 | 51,169 | 51,348 | 52,675 | 52,248 | |||||||||||||||||||||||||||
(1)Amounts reported are unpaid principal balance.
(2)Amounts primarily represent interest checking and money market and savings deposits.
(3)FTEs represents an average for the quarter.
18 Truist Financial Corporation
| Selected Items (1) | |||||||||||
| Favorable (Unfavorable) | |||||||||||
| (Dollars in millions) | After-Tax at | ||||||||||
| Description | Pre-Tax | Marginal Rate | |||||||||
| Selected Items | |||||||||||
| Second Quarter 2022 | |||||||||||
| Incremental operating expenses related to the merger ($103 million professional fees and outside processing, $11 million personnel expense, and $3 million other line items) | $ | (117) | $ | (89) | |||||||
| First Quarter 2022 | |||||||||||
| Incremental operating expenses related to the merger ($133 million professional fees and outside processing, $24 million personnel expense, $20 million net occupancy expense, and $25 million other line items) | $ | (202) | $ | (155) | |||||||
Gain on redemption of noncontrolling equity interest related to the acquisition of certain merchant services relationships (other income) | 74 | 57 | |||||||||
| Fourth Quarter 2021 | |||||||||||
| Incremental operating expenses related to the merger ($144 million professional fees and outside processing, $59 million personnel expense, and $12 million other line items) | $ | (215) | $ | (165) | |||||||
| Third Quarter 2021 | |||||||||||
| Incremental operating expenses related to the merger ($132 million professional fees and outside processing, $41 million personnel expense, and $18 million other line items) | $ | (191) | $ | (147) | |||||||
| Professional fee accrual (professional fees and outside processing) | (30) | (23) | |||||||||
| Second Quarter 2021 | |||||||||||
| Charitable contribution (other expense) | $ | (200) | $ | (153) | |||||||
| Incremental operating expenses related to the merger ($137 million professional fees and outside processing, $42 million personnel expense, and $11 million other line items) | (190) | (146) | |||||||||
| First Quarter 2021 | |||||||||||
| Incremental operating expenses related to the merger ($120 million professional fees and outside processing, $42 million personnel expense, and $13 million other line items) | $ | (175) | $ | (134) | |||||||
| Acceleration for cash flow hedge unwind (other expense) | (36) | (28) | |||||||||
(1)Includes selected items representing a part of line items within the consolidated statements of income. Excludes line items adjusted in their entirety, such as securities gains and losses, gains and losses on the early extinguishment of debt, and costs classified as merger-related and restructuring charges.
| Non-GAAP Reconciliations | ||||||||||||||||||||||||||||||||||||||||||||
| Quarter Ended | Year-to-Date | |||||||||||||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | June 30 | June 30 | ||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2022 | 2021 | 2021 | 2021 | 2022 | 2021 | |||||||||||||||||||||||||||||||||||||
Efficiency Ratio (1) | ||||||||||||||||||||||||||||||||||||||||||||
Efficiency Ratio Numerator - Noninterest Expense - GAAP | $ | 3,580 | $ | 3,674 | $ | 3,700 | $ | 3,795 | $ | 4,011 | $ | 7,254 | $ | 7,621 | ||||||||||||||||||||||||||||||
| Merger-related and restructuring charges, net | (121) | (216) | (212) | (172) | (297) | (337) | (438) | |||||||||||||||||||||||||||||||||||||
| Gain (loss) on early extinguishment of debt | 39 | — | 1 | — | — | 39 | 3 | |||||||||||||||||||||||||||||||||||||
| Incremental operating expense related to the merger | (117) | (202) | (215) | (191) | (190) | (319) | (365) | |||||||||||||||||||||||||||||||||||||
| Amortization of intangibles | (143) | (137) | (143) | (145) | (142) | (280) | (286) | |||||||||||||||||||||||||||||||||||||
| Charitable contribution | — | — | — | — | (200) | — | (200) | |||||||||||||||||||||||||||||||||||||
| Professional fee accrual | — | — | — | (30) | — | — | — | |||||||||||||||||||||||||||||||||||||
| Acceleration for cash flow hedge unwind | — | — | — | — | — | — | (36) | |||||||||||||||||||||||||||||||||||||
| Efficiency Ratio Numerator - Adjusted | $ | 3,238 | $ | 3,119 | $ | 3,131 | $ | 3,257 | $ | 3,182 | $ | 6,357 | $ | 6,299 | ||||||||||||||||||||||||||||||
Efficiency Ratio Denominator - Revenue (2) - GAAP | $ | 5,655 | $ | 5,325 | $ | 5,566 | $ | 5,598 | $ | 5,650 | $ | 10,980 | $ | 11,132 | ||||||||||||||||||||||||||||||
| Taxable equivalent adjustment | 28 | 26 | 24 | 28 | 28 | 54 | 56 | |||||||||||||||||||||||||||||||||||||
| Securities (gains) losses | 1 | 69 | — | — | — | 70 | — | |||||||||||||||||||||||||||||||||||||
| Gain on redemption of noncontrolling equity interest | — | (74) | — | — | — | (74) | — | |||||||||||||||||||||||||||||||||||||
| Gains on divestiture of certain businesses | — | — | — | — | — | — | (37) | |||||||||||||||||||||||||||||||||||||
| Efficiency Ratio Denominator - Adjusted | $ | 5,684 | $ | 5,346 | $ | 5,590 | $ | 5,626 | $ | 5,678 | $ | 11,030 | $ | 11,151 | ||||||||||||||||||||||||||||||
| Efficiency Ratio - GAAP | 63.3 | % | 69.0 | % | 66.5 | % | 67.8 | % | 71.0 | % | 66.1 | % | 68.5 | % | ||||||||||||||||||||||||||||||
| Efficiency Ratio - Adjusted | 57.0 | 58.3 | 56.0 | 57.9 | 56.1 | 57.6 | 56.5 | |||||||||||||||||||||||||||||||||||||
(1)The adjusted efficiency ratio is non-GAAP in that it excludes securities gains (losses), amortization of intangible assets, merger-related and restructuring charges, and other selected items. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. These measures are not necessarily comparable to similar measures that may be presented by other companies.
(2)Revenue is defined as net interest income plus noninterest income.
Truist Financial Corporation 19
| Quarter Ended | Year-to-Date | |||||||||||||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | June 30 | June 30 | ||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2022 | 2022 | 2021 | 2021 | 2021 | 2022 | 2021 | |||||||||||||||||||||||||||||||||||||
| Return on Average Tangible Common Shareholders’ Equity (1) | ||||||||||||||||||||||||||||||||||||||||||||
| Net income available to common shareholders | $ | 1,454 | $ | 1,327 | $ | 1,524 | $ | 1,616 | $ | 1,559 | $ | 2,781 | $ | 2,893 | ||||||||||||||||||||||||||||||
| Plus: Amortization of intangibles, net of tax | 109 | 105 | 110 | 113 | 107 | 214 | 218 | |||||||||||||||||||||||||||||||||||||
| Tangible net income available to common shareholders | $ | 1,563 | $ | 1,432 | $ | 1,634 | $ | 1,729 | $ | 1,666 | $ | 2,995 | $ | 3,111 | ||||||||||||||||||||||||||||||
| Average common shareholders’ equity | $ | 56,803 | $ | 60,117 | $ | 61,807 | $ | 62,680 | $ | 61,709 | $ | 58,451 | $ | 61,979 | ||||||||||||||||||||||||||||||
| Less: Average intangible assets, net of deferred taxes | 29,173 | 28,905 | 27,523 | 27,149 | 26,366 | 29,040 | 26,450 | |||||||||||||||||||||||||||||||||||||
| Average tangible common shareholders’ equity | $ | 27,630 | $ | 31,212 | $ | 34,284 | $ | 35,531 | $ | 35,343 | $ | 29,411 | $ | 35,529 | ||||||||||||||||||||||||||||||
| Return on average common shareholders’ equity | 10.3 | % | 9.0 | % | 9.8 | % | 10.2 | % | 10.1 | % | 9.6 | % | 9.4 | % | ||||||||||||||||||||||||||||||
| Return on average tangible common shareholders’ equity | 22.7 | 18.6 | 18.9 | 19.3 | 18.9 | 20.5 | 17.7 | |||||||||||||||||||||||||||||||||||||
(1)Tangible common equity and related measures are non-GAAP measures that exclude the impact of intangible assets, net of deferred taxes, and their related amortization. These measures are useful for evaluating the performance of a business consistently, whether acquired or developed internally. Truist’s management uses these measures to assess the quality of capital and returns relative to balance sheet risk. These measures are not necessarily comparable to similar measures that may be presented by other companies.
| Quarter Ended | Year-to-Date | ||||||||||||||||||||||||||||||||||||||||
| June 30 | March 31 | Dec. 31 | Sept. 30 | June 30 | June 30 | June 30 | |||||||||||||||||||||||||||||||||||
| (Dollars in millions, except per share data) | 2022 | 2022 | 2021 | 2021 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||||||||||||
Diluted EPS (1) | |||||||||||||||||||||||||||||||||||||||||
Net income available to common shareholders - GAAP | $ | 1,454 | $ | 1,327 | $ | 1,524 | $ | 1,616 | $ | 1,559 | $ | 2,781 | $ | 2,893 | |||||||||||||||||||||||||||
| Merger-related and restructuring charges | 92 | 166 | 163 | 132 | 228 | 258 | 336 | ||||||||||||||||||||||||||||||||||
| Securities (gains) losses | — | 53 | — | — | — | 53 | — | ||||||||||||||||||||||||||||||||||
| Loss (gain) on early extinguishment of debt | (30) | — | — | — | (1) | (30) | (3) | ||||||||||||||||||||||||||||||||||
| Incremental operating expenses related to the merger | 89 | 155 | 165 | 147 | 146 | 244 | 280 | ||||||||||||||||||||||||||||||||||
| Charitable contribution | — | — | — | — | 153 | — | 153 | ||||||||||||||||||||||||||||||||||
| Professional fee accrual | — | — | — | 23 | — | — | — | ||||||||||||||||||||||||||||||||||
| Acceleration for cash flow hedge unwind | — | — | — | — | — | — | 28 | ||||||||||||||||||||||||||||||||||
| Gain on redemption of noncontrolling equity interest | — | (57) | — | — | — | (57) | — | ||||||||||||||||||||||||||||||||||
| Net income available to common shareholders - adjusted | $ | 1,605 | $ | 1,644 | $ | 1,852 | $ | 1,918 | $ | 2,085 | $ | 3,249 | $ | 3,687 | |||||||||||||||||||||||||||
Weighted average shares outstanding - diluted | 1,338,864 | 1,341,563 | 1,343,029 | 1,346,854 | 1,349,492 | 1,340,225 | 1,354,210 | ||||||||||||||||||||||||||||||||||
| Diluted EPS - GAAP | $ | 1.09 | $ | 0.99 | $ | 1.13 | $ | 1.20 | $ | 1.16 | $ | 2.08 | $ | 2.14 | |||||||||||||||||||||||||||
| Diluted EPS - adjusted | 1.20 | 1.23 | 1.38 | 1.42 | 1.55 | 2.43 | 2.72 | ||||||||||||||||||||||||||||||||||
(1)The adjusted diluted earnings per share is non-GAAP in that it excludes merger-related and restructuring charges and other selected items, net of tax. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges.
20 Truist Financial Corporation
Second Quarter 2022 Earnings Conference Call Bill Rogers – Chairman & CEO Daryl Bible – CFO July 19, 2022
2 This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, regarding the financial condition, results of operations, business plans and the future performance of Truist. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “projects,” “may,” “will,” “should,” “would,” “could” and other similar expressions are intended to identify these forward-looking statements. In particular, forward looking statements include, but are not limited to, statements we make about: (i) Truist’s ability to generate positive operating leverage in future periods, (ii) the benefits of Truist’s shift from integrating to operating, (iii) the benefits and expenses related to Truist’s investment in teammates, including through an increase in its minimum wage, (iv) the potential associated with investments in digital capabilities offered by Truist and the timing for making new capabilities available, (v) future levels of adjusted and core revenue, fee income, including from service charges on deposits,, adjusted noninterest expense, net charge-off ratio, adjusted PPNR, and net interest margin, (vi) the future benefits of Truist’s merger integration and conversion activities, (vii) projected amounts of merger-related and restructuring charges and incremental operating expenses related to the merger and the timing for elimination of such charges and expenses, (viii) the amount of expense savings to be realized from the merger and the timing of such realization, (ix) Truist’s expectations for its CET1 ratio and share repurchases, (x) anticipated capital deployment in future periods, (xi) the effects of interest rate changes on Truist’s net interest income, (xii) Truist’s medium-term performance targets with respect to return on tangible common equity and efficiency ratio, (xiii) projections of future dividends, (xiv) the future performance of Truist’s CRE business, and (xv) Truist’s prospects for continued loan growth in future periods. Forward-looking statements are not based on historical facts but instead represent management’s expectations and assumptions regarding Truist’s business, the economy and other future conditions. Such statements involve inherent uncertainties, risks and changes in circumstances that are difficult to predict. As such, Truist’s actual results may differ materially from those contemplated by forward-looking statements. While there can be no assurance that any list of risks and uncertainties or risk factors is complete, important factors that could cause actual results to differ materially from those contemplated by forward-looking statements include the following, without limitation, as well as the risks and uncertainties more fully discussed under Part I, Item 1A-Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2021 and in Truist’s subsequent filings with the Securities and Exchange Commission: • residual risks and uncertainties relating to the Merger of heritage BB&T and heritage SunTrust, including the ability to realize the anticipated benefits of the Merger; • expenses relating to the Merger and application and data center decommissioning; • deposit attrition, client loss or revenue loss following completed mergers or acquisitions may be greater than anticipated; • the COVID-19 pandemic disrupted the global economy and adversely impacted Truist’s financial condition and results of operations, including through increased expenses, reduced fee income and net interest margin, decreased demand for certain types of loans, and increases in the allowance for credit losses; a resurgence of the pandemic, whether due to new variants of the coronavirus or other factors, could reintroduce or prolong these negative impacts and also adversely affect Truist’s capital and liquidity position or cost of capital, impair the ability of borrowers to repay outstanding loans, cause an outflow of deposits, and impair goodwill or other assets; • Truist is subject to credit risk by lending or committing to lend money, and may have more credit risk and higher credit losses to the extent that loans are concentrated by loan type, industry segment, borrower type or location of the borrower or collateral; • changes in the interest rate environment, including the replacement of LIBOR as an interest rate benchmark, which could adversely affect Truist’s revenue and expenses, the value of assets and obligations, and the availability and cost of capital, cash flows, and liquidity; • inability to access short-term funding or liquidity, loss of client deposits or changes in Truist’s credit ratings, which could increase the cost of funding or limit access to capital markets; • risk management oversight functions may not identify or address risks adequately, and management may not be able to effectively manage credit risk; • risks resulting from the extensive use of models in Truist’s business, which may impact decisions made by management and regulators; • failure to execute on strategic or operational plans, including the ability to successfully complete or integrate mergers and acquisitions; • increased competition, including from (i) new or existing competitors that could have greater financial resources or be subject to different regulatory standards, and (ii) products and services offered by non-bank financial technology companies, may reduce Truist’s client base, cause Truist to lower prices for its products and services in order to maintain market share or otherwise adversely impact Truist’s businesses or results of operations; • failure to maintain or enhance Truist’s competitive position with respect to new products, services and technology, whether it fails to anticipate client expectations or because its technological developments fail to perform as desired or do not achieve market acceptance or regulatory approval or for other reasons, may cause Truist to lose market share or incur additional expense; • negative public opinion, which could damage Truist’s reputation; • increased scrutiny regarding Truist’s consumer sales practices, training practices, incentive compensation design, and governance; • regulatory matters, litigation or other legal actions, which may result in, among other things, costs, fines, penalties, restrictions on Truist’s business activities, reputational harm, negative publicity, or other adverse consequences; • evolving legislative, accounting and regulatory standards, including with respect to climate, capital, and liquidity requirements, and results of regulatory examinations may adversely affect Truist’s financial condition and results of operations; • the monetary and fiscal policies of the federal government and its agencies, including in response to rising inflation, could have a material adverse effect on profitability; • accounting policies and processes require management to make estimates about matters that are uncertain, including the potential write down to goodwill if there is an elongated period of decline in market value for Truist’s stock and adverse economic conditions are sustained over a period of time; • general economic or business conditions, either globally, nationally or regionally, may be less favorable than expected, and instability in global geopolitical matters or volatility in financial markets could result in, among other things, slower deposit or asset growth, a deterioration in credit quality, or a reduced demand for credit, insurance, or other services; • risks related to originating and selling mortgages, including repurchase and indemnity demands from purchasers related to representations and warranties on loans sold, which could result in an increase in the amount of losses for loan repurchases; • risks relating to Truist’s role as a loan servicer, including an increase in the scope or costs of the services Truist is required to perform, without any corresponding increase in servicing fees or a breach of Truist’s obligations as servicer; • Truist’s success depends on hiring and retaining key teammates, and if these individuals leave or change roles without effective replacements, Truist’s operations and integration activities could be adversely impacted, which could be exacerbated in the increased work-from-home environment caused by the COVID-19 pandemic as job markets may be less constrained by physical geography; • fraud or misconduct by internal or external parties, which Truist may not be able to prevent, detect, or mitigate; • security risks, including denial of service attacks, hacking, social engineering attacks targeting Truist’s teammates and clients, malware intrusion, data corruption attempts, system breaches, cyber-attacks, which have increased in frequency with current geopolitical tensions, identity theft, ransomware attacks, and physical security risks, such as natural disasters, environmental conditions, and intentional acts of destruction, could result in the disclosure of confidential information, adversely affect Truist’s business or reputation or create significant legal or financial exposure; and • widespread outages of operational, communication, or other systems, whether internal or provided by third parties, natural or other disasters (including acts of terrorism and pandemics), and the effects of climate change, including physical risks, such as more frequent and intense weather events, and risks related to the transition to a lower carbon economy, such as regulatory or technological changes or shifts in market dynamics or consumer preferences, could have an adverse effect on Truist’s financial condition and results of operations, lead to material disruption of Truist’s operations or the ability or willingness of clients to access Truist’s products and services. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. Except to the extent required by applicable law or regulation, Truist undertakes no obligation to revise or update any forward-looking statements. Forward-Looking Statements
3 Non-GAAP Information This presentation contains financial information and performance measures determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Truist’s management uses these "non-GAAP" measures in their analysis of the Corporation's performance and the efficiency of its operations. Management believes these non-GAAP measures provide a greater understanding of ongoing operations, enhance comparability of results with prior periods and demonstrate the effects of significant items in the current period. The Company believes a meaningful analysis of its financial performance requires an understanding of the factors underlying that performance. Truist’s management believes investors may find these non-GAAP financial measures useful. These disclosures should not be viewed as a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non- GAAP performance measures that may be presented by other companies. Below is a listing of the types of non-GAAP measures used in this presentation: Adjusted Efficiency Ratio - The adjusted efficiency ratio is non-GAAP in that it excludes securities gains (losses), amortization of intangible assets, merger-related and restructuring charges, and other selected items. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. Adjusted Operating Leverage - The adjusted operating leverage ratio is non-GAAP in that it excludes securities gains (losses), amortization of intangible assets, merger-related and restructuring charges, and other selected items. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. Pre-Provision Net Revenue (PPNR) - Pre-provision net revenue is a non-GAAP measure that adjusts net income determined in accordance with GAAP to exclude the impact of the provision for credit losses and provision for income taxes. Adjusted pre-provision net revenue is a non-GAAP measure that additionally excludes securities gains (losses), merger-related and restructuring charges, amortization of intangible assets, and other selected items. Truist’s management believes these measures provide a greater understanding of ongoing operations and enhances comparability of results with prior periods. Tangible Common Equity and Related Measures - Tangible common equity and related measures are non-GAAP measures that exclude the impact of intangible assets, net of deferred taxes, and their related amortization. These measures are useful for evaluating the performance of a business consistently, whether acquired or developed internally. Truist’s management uses these measures to assess the quality of capital and returns relative to balance sheet risk. Core NIM - Core net interest margin is a non-GAAP measure that adjusts net interest margin to exclude the impact of purchase accounting. The purchase accounting marks and related amortization for loans, deposits, and long-term debt from SunTrust and other acquisitions are excluded to approximate the yields paid by clients. Truist’s management believes the adjustments to the calculation of net interest margin for certain assets and liabilities acquired provide investors with useful information related to the performance of Truist’s earning assets. Adjusted Diluted EPS - The adjusted diluted earnings per share is non-GAAP in that it excludes merger-related and restructuring charges and other selected items, net of tax. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. Performance Ratios - The adjusted performance ratios, including adjusted return on average assets, adjusted return on average common shareholders’ equity, and adjusted return on average tangible common shareholders’ equity, are non-GAAP in that they exclude merger-related and restructuring charges, selected items, and, in the case of return on average tangible common shareholders’ equity, amortization of intangible assets. Truist’s management uses these measures in their analysis of the Corporation’s performance. Truist’s management believes these measures provide a greater understanding of ongoing operations and enhance comparability of results with prior periods, as well as demonstrate the effects of significant gains and charges. Insurance Holdings Adjusted EBITDA - EBITDA is a non-GAAP measurement of operating profitability that is calculated by adding back interest, taxes, depreciation, and amortization to net income. Truist’s management also adds back merger- related and restructuring charges, incremental operating expenses related to the merger, and other selected items. Truist’s management uses this measure in its analysis of the Corporation’s Insurance Holdings segment. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. Selected items affecting results are included on slide 7.
4
5 Living our purpose Inspire and build better lives and communities Community Impact, Financial Inclusion, and Education Responsible Business and Ethical Conduct Technology and Client Service Human Capital and DEI ESG and Environmental Sustainability – Achieved 112% of prorated goal for the $60 billion 3 year 2020-2022 Community Benefits Plan commitment1 – Announced a $120 million commitment to strengthen and support diverse-owned small businesses – Executive leadership began a cross-market tour, partnering with local teammates to put Caring into action through client engagement & teammate listening sessions, local volunteerism, and investments in our communities – Named one of Forbes Best Employers for New Graduates and Best Employers for Diversity – Recognized as a Top 50 employer by Equal Opportunity magazine – Eliminated significant overdraft- related fees in April and launched Truist One Banking (July) – a first- of-its-kind approach to the checking account experience: provides accounts with no overdraft fees and other solutions to help clients grow and achieve financial success – Launched the state-of-the-art Innovation and Technology Center to support our ongoing efforts to transform the client experience – Acquired Long Game, the award winning mobile app that motivates smart financial behaviors – Announced plans to increase minimum wage pay to $22/hour for eligible teammates to attract and retain top talent, address the rising cost of living, and position Truist among the leaders in the industry – 16.8% of senior leadership roles are held by ethnically diverse teammates; with continued aspirations for growth in this area – Published the 2021 Truist ESG & CSR Report, which expands our ESG disclosures and highlights the significant steps we’ve taken to meet and exceed our goals, including: – Strengthening the diversity of senior leadership – Advancing a lower carbon economy – Fulfilling our Community Benefits Plan commitments 1 As of 5/31/22
Financial Results
7 Selected items affecting 2Q22 results Item ($ MM, except per share impact) Pre-Tax After-Tax Diluted EPS Impact Merger-related and restructuring charges ($121) ($92) ($0.07) Incremental operating expenses related to the merger ($117) ($89) ($0.07) Gain on early extinguishment of debt $39 $30 $0.02 See non-GAAP reconciliations in the appendix Diluted EPS impact for individual items may not foot to difference between GAAP diluted and adjusted diluted EPS due to rounding
8 2Q22 performance highlights Earnings and profitability – Solid financial results despite volatile market conditions – $1.6 billion of adjusted net income available to common, or $1.20 per share and adjusted ROTCE of 25% – Adjusted EPS relatively stable sequentially as higher PPNR offset by higher provision cost (due to reserve release in 1Q22) – Adjusted PPNR up 10% sequentially as a result of expanding net interest margin, strong loan growth, and continued strength in insurance – Interest-bearing deposit beta (ex. brokered) of 8% – Continue to target positive operating leverage (GAAP and adjusted) for full year – Sequential adjusted operating leverage was 250 bps and YTD adjusted operating leverage was (200) bps – Asset quality remains excellent: 22 bps NCO Balance sheet, capital, and liquidity – Robust EOP loan growth of 4.7% – Liquidity and funding remain stable and strong – Average deposits up 2.0% sequentially – LCR of 110% – Capital (9.2% CET1) remains strong, particularly in the context of Truist’s risk profile – June 2022 CCAR results continue to demonstrate Truist’s diverse business mix, conservative credit culture, and strong profitability profile – Repurchased $250 million of common shares in 2Q22 and announced intent to increase common dividend 8% in 3Q22 Change vs. 2Q22 1Q22 2Q21 GAAP / Unadjusted Revenue $5,683 6.2% 0.1% Expense $3,580 (2.6)% (10.7)% PPNR $2,103 25.4% 26.2% Provision for credit losses $171 NM NM Net income available to common $1,454 9.6% (6.7)% Diluted EPS $1.09 10.1% (6.0)% ROTCE 22.7% 410 bps 380 bps Efficiency ratio 63.3% (570) bps (770) bps Adjusted Revenue $5,684 6.3% 0.1% Expense $3,238 3.8% 1.8% PPNR $2,446 9.8% (2.0)% Net income available to common $1,605 (2.4)% (23.0)% Diluted EPS $1.20 (2.4)% (22.6)% ROTCE 24.8% 220 bps 10 bps Efficiency ratio 57.0% (130) bps 90 bps Note: All data points are taxable-equivalent, where applicable; see non-GAAP reconciliations in the appendix Summary Income Statement ($ MM) Commentary
9 Digital care for Truist clients 1Q22 2Q22 1Q22 2Q22 1 Digital commerce defined as products (deposits, lending, mortgage, ex. LightStream) opened through digital applications 2 Active users reflects clients that have logged in using the mobile app over the prior 90 days 3 Digital transactions include transfers, Zelle, bill payments, mobile deposits, ACH, and wire transfers 256K 355K 4.2MM 4.3MM Digital Commerce Growth1 Mobile App Users2 Digital Transactions3 Zelle Transactions Introducing Truist’s Innovation and Technology Center 1Q22 2Q22 58MM 63MM 1Q22 2Q22 13MM 16MM – Announced the grand opening of our Innovation and Technology Center (ITC) in June – State-of-the-art facility where we can work collaboratively with clients to co-create dynamic cross-channel services and bring client-validated experiences to market – In addition to client journey rooms, the ITC features research labs and a Contact Center incubator that enables us to collect and respond to real-time client feedback 39% 1% 18% 9% Building momentum to accelerate client adoption and operationalize innovation
10 $170.5 $165.8 $164.5 $167.5 $173.3 $118.0 $120.4 $121.8 $121.1 $123.4 4.03% 3.92% 3.81% 3.70% 3.91% 3.61% 3.58% 3.49% 3.42% 3.64% Commercial LHFI ($ B) Consumer & Card LHFI ($ B) Loans HFI yield (%) Loans HFI yield ex. PAA (%) 2Q21 3Q21 4Q21 1Q22 2Q22 – Average loans up 2.8%; up 5.7% ex. PPP (YoY trends generally similar to prior quarter) – C&I, ex. PPP, up 11% – CRE/commercial construction down 13% – Residential mortgage up 13% – Consumer/card (ex. mortgage) relatively stable – Broad-based growth: average loans up 2.8%; up 3.1% ex. PPP – C&I up 4.8%, primarily due to growth across most CIB industry verticals and product groups – CRE/commercial construction down $0.8 billion, or 2.9%, given competitive environment – Residential mortgage up $1.3 billion, or 2.6%, as a result of continued correspondent purchases and slower prepays – Consumer/card, ex. mortgage, up $1.0 billion, or 1.3%, as a result of strong growth in Service Finance, recreational lending, prime auto, Sheffield, and LightStream; partially offset by runoff in partnership loans and student – EOP loans up 4.7% — similar drivers to average trends Average loans & leases HFI 5-Quarter Trend vs. Prior Quarter vs. Prior Year $288.6 $286.2 $286.3 $288.6 $296.7
11 – Average deposits increased $8.5 billion, or 2.0% – Ex. brokered deposits, average deposits declined $2.9 billion, or 0.7% – Noninterest-bearing deposits increased 1.9% – Controlled deposit costs – Total cost of deposits was 9 bps; up 6 bps compared to prior quarter – Total cost of interest-bearing deposits was 14 bps, up 9 bps compared to prior quarter – Reflects a 15% beta (ex. brokered deposits was 8%)1 Average deposits $258.4 $261.0 264.5 269.3 275.1 $137.9 $141.7 $146.5 $145.9 $148.6 0.04% 0.03% 0.03% 0.03% 0.09% Interest-bearing deposits Noninterest-bearing deposits Total deposit cost (%) 2Q21 3Q21 4Q21 1Q22 2Q22 5-Quarter Trend vs. Prior Quarter vs. Prior Year – Average deposits increased $27 billion, or 6.9%, due to the previous impacts of government stimulus 1 Beta calculations are based on change in average deposit costs divided by change in average Fed Funds rate from 1Q22 to 2Q22 $396.3 $402.7 $411.0 $415.2 $423.8
12 – Net interest income increased 7.0% as a result of higher short-term interest rates (alongside controlled deposit costs) and strong loan growth – Reported NIM and core NIM expanded 13 and 15 bps, respectively, as a result of higher short-term interest rates (alongside controlled deposit costs) and positive earning asset mix shift from securities into loans $3,273 $3,261 $3,267 $3,209 $3,435 $2,965 $3,006 $3,030 $2,999 $3,231$308 $255 $237 $210 $204 2.88% 2.81% 2.76% 2.76% 2.89% 2.60% 2.58% 2.55% 2.57% 2.72% Core net interest income TE ($ MM) Purchase accounting accretion ($ MM) Reported NIM (%) Core NIM (%) 2Q21 3Q21 4Q21 1Q22 2Q22 Net interest income & net interest margin 5-Quarter Trend vs. Prior Quarter vs. Prior Year – Net interest income up 4.9% as a result of higher market interest rates (alongside controlled deposit costs), loan growth, and larger securities portfolio (as a result of strong deposit growth); partially offset by lower PAA and PPP revenue – Reported NIM stable YoY as core NIM expansion of 12 bps was offset by lower PAA contribution 1 See non-GAAP reconciliations in the appendix 1
13 – Noninterest income increased $106 million, or 4.9% – Insurance income increased $98 million, or 13%, driven by seasonality, continued strong organic growth, and the acquisition of Kensington Vanguard – Card and payment related fees increased $34 million, or 16%, due to the prior quarter merchant acquisition and increased activity – Residential mortgage declined $15 million due to lower refi volumes and gain-on-sale margins – Other income, excluding the merchant acquisition gain and NQDCP impacts, decreased $25 million primarily due to the loss on sale of certain SBIC investments (see table) – Prior quarter (1Q22) included $74 million merchant acquisition gain and $69 million loss on securities repositioning $2,405 $2,365 $2,323 $2,142 $2,248 $690 $645 $666 $727 $825 $402 $316 $377 $261 $255 $345 $356 $350 $343 $337 $253 $276 $273 $252 $254 $715 $772 $657 $559 $577 42.6% 42.2% 41.7% 40.2% 39.7% Insurance income Investment banking & trading Wealth management income Service charges on deposits All other fee categories Fee income ratio (%) 2Q21 3Q21 4Q21 1Q22 2Q22 Noninterest income 5-Quarter Trend vs. Prior Quarter vs. Prior Year – Noninterest income declined $157 million, or 6.5% – Insurance income increased $135 million, or 20% (7.7% organic growth and acquisitions) – Investment banking & trading declined $147 million, or 37%, due to volatile market conditions – Residential mortgage income declined $43 million, or 37%, due to higher rates (impacting refi volumes and margins) – Other income, excluding NQDCP impact, decreased $31 million due to aforementioned SBIC losses and lower investment-related valuations/ gains (see table) Other income detail 2Q21 1Q22 2Q22 Other income (ex. items below) $ 77 $ 71 $ 46 NQDCP impact 43 (44) (30) Gain on selected transactions — 74 — Other income $ 120 $ 101 $ 16
14 71.0% 67.8% 66.5% 69.0% 63.3% 56.1% 57.9% 56.0% 58.3% 57.0% Adjusted noninterest expense Merger costs Amortization Other significant items GAAP efficiency ratio Adjusted efficiency ratio 2Q21 3Q21 4Q21 1Q22 2Q22 – Noninterest expense declined $94 million, or 2.6% – 2Q22 included $238 million of merger costs1 compared to $418 million in 1Q22 – Adjusted noninterest expense was $3.2 billion, up $119 million, or 3.8% – Personnel expense2 increased $64 million primarily as a result of seasonally higher insurance-related incentive compensation and investments in talent in lines of business and enterprise technology – Other expense2 increased $19 million due to higher operational losses and increased teammate travel – Professional fees and outside processing costs2 increased $16 million due to enterprise technology investments and increased call center staffing – Noninterest expense declined $431 million, or 11% – Merger costs1 declined $249 million – 2Q21 also included $200 million charitable contribution to Truist Foundation and Truist Charitable Fund – Adjusted noninterest expense up $56 million, or 1.8% – Other expense2 increased $73 million as a result of higher operational losses and increased teammate travel – Professional fees and outside processing2 up $42 million due to enterprise technology investments and increased call center staffing – Personnel expense2 down $74 million as a result of impacts from the nonqualified plan, lower performance-driven incentives, partially offset by higher salaries 5-Quarter Trend ($ MM) vs. Prior Year 1 Includes merger-related and restructuring charges and incremental operating expenses related to the merger 2 Excludes incremental operating expenses related to the merger Noninterest expense vs. Prior Quarter $4,011 $200 $142 $487 $3,182 $3,795 $30 $145 $363 $3,257 $3,700 $143 $427 $3,131 $3,674 $137 $418 $3,119 $3,580 $143 $238 $3,238 ($39) 1
15 Asset quality 4.5x 9.0x 8.8x $421Net Charge-Offs Provision / (Benefit) for Credit Losses Nonperforming Loans / LHFI ALLL $142 $135 $182 $178 $159 0.20% 0.19% 0.25% 0.25% 0.22% NCO NCO ratio 2Q21 3Q21 4Q21 1Q22 2Q22 ($434) ($324) ($103) ($95) $171 2Q21 3Q21 4Q21 1Q22 2Q22 0.37% 0.38% 0.38% 0.36% 0.36% 2Q21 3Q21 4Q21 1Q22 2Q22 $5,121 $4,702 $4,435 $4,170 $4,187 1.79% 1.65% 1.53% 1.44% 1.38% ALLL ALLL ratio ALLL / NCO 2Q21 3Q21 4Q21 1Q22 2Q22 Continued strong credit performance Provision expense approximated net charge-offs in 2Q22 as the impacts of loan growth were offset by a decline in the ALLL ratio ALLL ratio declined 6 bps given strong portfolio performance, partially offset by moderately slower economic outlook Asset quality remains excellent, reflecting our prudent risk culture, diverse portfolio, and solid economic conditions Leading indicators (NPL, early stage delinquencies) remain strong $48 9.0X 8.8X 6.1X 5.8X 6.5X
16 Capital and liquidity position 10.2% 9.4% 9.2% Common Equity Tier 1 Tier 1 Total 2Q21 1Q22 2Q22 Current quarter regulatory capital information is preliminary 113% 111% 110% $83.5 $83.9 $85.0 LCR HQLA ($ B) 2Q21 1Q22 2Q22 13.9% Capital position – CET1 ratio was 9.2%, down 20 bps from 3/31 – Decline driven by strong 4.7% EOP loan growth and $250 million share repurchase – Board will consider a resolution to increase common dividend 8% to $0.52 per share in 3Q22 – Continued strong CCAR results – Stressed capital buffer remained flat at 250 bps – Second lowest CET1 erosion and loan loss rate compared to peers (severely adverse scenario) – Overall, continue to maintain a very strong capital position, particularly in the context of risk and profitability profile Liquidity position – Average LCR for 2Q22 was 110% – Average loan-to-deposit ratio of 70% 12.0% 14.2% 13.0% 11.0% Capital and liquidity position Commentary 10.8% 12.6%
17 2020 2021 2022 2023 Pandemic Executional excellence Transformation and growth Integration Well Positioned for 2022 and Beyond – Finalize the merger – February conversion (complete) – Eliminate merger-related charges and incremental operating expenses by year-end – Achieve cost saves objectives – Shift from integration to executional excellence, transformation, and growth – Realize significant benefit from becoming One Truist (systems, digital, brand, IRM) – Accelerate revenue momentum – Client experience enhancements – Continue to target positive operating leverage for full year 2022 (GAAP and adjusted) Shifting from integration focus to executional excellence, transformation, and growth
18 Investment thesis Why Truist? Purpose-Driven Culture Exceptional Company Investing in the Future Leading Financial Performance – Inspire and build better lives and communities – Optimize long-term value for all stakeholders through safe, sound, and ethical practices – Attract and retain top talent – Continued strong ESG progress – 6th largest U.S. commercial bank – Comprehensive and diverse business mix with distinct capabilities in insurance, investment banking, digital / point-of- sale lending, and advice / industry expertise – Significant revenue synergy potential – Strong market shares in high growth footprint (South / Mid-Atlantic) with select national businesses – Building a better technology foundation with ‘best of breed’ approach – Obsess over enhanced client experience to drive client acquisition – Enabling convenient commerce – Fit-for-purpose approach (build, buy, partner) – Increased usage of open banking, APIs, and Truist Ventures – Targeting strong growth and profitability (with lower volatility) – Continued confidence in achieving $1.6 billion of net cost savings – ROATCE: Low 20s – ER: Low 50s – Disciplined risk and financial management; focus on diversity – Strong risk adjusted capital position
Appendix
A-1 Consumer Banking & Wealth Income statement ($ MM) 2Q22 Linked Qtr. Change Like Qtr. Change Net interest income $2,274 $92 $202 Provision for credit losses 199 126 203 Noninterest income 892 (58) (33) Noninterest expense 1,954 46 9 Segment net income 773 (100) (26) Balance Sheet ($ B) Average loans(1) $134.3 $2.7 $3.7 Average deposits 255.3 2.2 14.2 Other Key Metrics Mortgages serviced for others ($ B)(2) $209.5 $13.8 $31.5 Wealth management AUM ($ B)(2) 180.1 (16.4) (23.0) Branches 2,117 5 (440) (1) Excludes loans held for sale (2) Amount reported reflects end of period balance Represents performance for Retail and Small Business Banking, Wealth, Mortgage Banking, Dealer Retail Services, and Consumer Finance & Payments – Net income of $773 million, down $100 million from the prior quarter – Increase in NII driven by primarily by higher funding credit on deposits and higher average loan balances, partially offset by decreased loan spreads and lower PAA – Loans grew 2% vs. 1Q22 and 3% vs. 2Q21 primarily driven by increased residential mortgage balances along with increased Service Finance, recreational lending, Sheffield, and prime auto loans, partially offset by runoff in partnership and student loans – Deposits continue to grow (up 1% vs. 1Q22 and 6% vs. 2Q21) primarily driven by the lingering impacts of government stimulus programs in the prior year – Provision for credit losses increased reflecting the impact of loan growth in the current quarter and reserve releases in prior quarters – Fee income down 6% vs. 1Q22 primarily driven by prior quarter $74 million merchant acquisition gain and lower mortgage income – Expenses increased 2% vs. 1Q22 primarily driven by MRCs, IT professional services (call center staffing), advertising (Truist brand expense post MOE7), and operating losses – Branch count down 17% vs. 2Q21 due to MOE consolidations Metrics Commentary
A-2 Corporate & Commercial Banking Income Statement ($ MM) 2Q22 Linked Qtr. Change Like Qtr. Change Net interest income $1,334 $64 $38 Provision for credit losses (28) 122 371 Noninterest income 636 17 (172) Noninterest expense 781 25 (47) Segment net income 954 (49) (352) Balance Sheet ($ B) Average loans(1) $161.7 $7.1 $6.5 Average deposits 147.1 (5.2) (0.7) – Net income of $954 million, down 5% or $49 million vs. 1Q22, primarily driven by higher provision for loan losses and higher expenses, partially offset by higher revenue – NII of $1.3 billion increased 5%, or $64 million, as a result of strong loan growth, partially offset by a reduction in PPP fees – Noninterest income of $636 million relatively stable sequentially and down 21% YoY due to lower investment banking & trading income – Total expenses of $781 million, increased $25 million sequentially, related to targeted, strategic hiring – Average loans of $161.7 billion, up $7.1 billion or 5% driven by broad-based growth across most CIB industry verticals and product groups – Average deposits of $147.1 billion decreased $5.2 billion or 3%, due to seasonality of public funds outflows in 1Q and tax-related payments in mid-April (1) Excludes loans held for sale Represents performance for Commercial Community Banking, Corporate & Investment Banking, and CRE & Grandbridge Metrics Commentary
A-3 Insurance Holdings Income statement ($ MM) 2Q22 Linked Qtr. Change Like Qtr. Change Net interest income $28 $4 $3 Noninterest income 833 95 135 Total revenue 861 99 138 Noninterest expense 624 64 109 Segment net income 178 26 19 Performance ($ MM) Y-o-Y organic revenue growth 7.7% 0.5% (7.1%) Net acquired revenue 80 21 49 Performance based commissions 22 6 7 Adjusted EBITDA(1) 278 37 30 Adjusted EBITDA margin(1) 32.3% 0.7% (2.0%) – Strong revenue quarter driven by growth from acquired revenue, strong new business generation, stable retention and continued P&C renewal premium increases – Market conditions: – Market conditions remain favorable with stable price increases, increasing exposure units and cautious underwriting due to rising loss costs and increasing reinsurance pricing – Seeing consistent P&C price increases – Revenue increased 19% vs. 2Q21 – Organic revenue growth of 7.7% – 2Q22 new business was up 10% – Acquired revenue of $80 million – Revenue up 13% vs. 1Q22 primarily due to seasonality in P&C renewal commissions – Expenses up 21% vs. 2Q21 – Increase driven by higher performance-based incentive expense, higher travel and entertainment expense, and increase from acquisitions – EBITDA margin declined 200 bps vs. 2Q21 driven by mix of business during the quarter, rising T&E expense and investments to support future growth (1) EBITDA is a non-GAAP measurement of operating profitability that is calculated by adding back interest, taxes, depreciation, and amortization to net income. Truist’s management also adds back merger- related and restructuring charges, incremental operating expenses related to the merger, and other selected items. Truist’s management uses this measure in its analysis of the Corporation’s Insurance Holdings segment. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. See non-GAAP reconciliations included in the attached Appendix. Represents performance for Truist Insurance Holdings’ Retail, Wholesale, and Services Divisions Metrics Commentary
A-4 Purchase accounting summary(1) ($ MM) As of/For the Quarter Ended June 30 March 31 Dec. 31 Sept. 30 June 30 2022 2022 2021 2021 2021 Loans and Leases(2) Beginning balance unamortized fair value mark $ (1,119) $ (1,323) $ (1,540) $ (1,777) $ (2,067) Accretion 189 191 217 233 285 Purchase accounting adjustments and other activity 6 13 — 4 5 Ending balance $ (924) $ (1,119) $ (1,323) $ (1,540) $ (1,777) Core deposit and other intangible assets Beginning balance $ 3,693 $ 3,408 $ 2,930 $ 2,665 $ 2,825 Additions - acquisitions — 430 647 418 — Amortization (143) (137) (143) (145) (142) Amortization in net occupancy expense (5) (8) (3) (4) (3) Purchase accounting adjustments and other activity (10) — (23) (4) (15) Ending balance $ 3,535 $ 3,693 $ 3,408 $ 2,930 $ 2,665 Deposits(3) Beginning balance unamortized fair value mark $ (5) $ (7) $ (9) $ (12) $ (15) Amortization 2 2 2 3 3 Ending balance $ (3) $ (5) $ (7) $ (9) $ (12) Long-Term Debt(3) Beginning balance unamortized fair value mark $ (122) $ (139) $ (157) $ (176) $ (196) Amortization 13 17 18 19 20 Ending balance $ (109) $ (122) $ (139) $ (157) $ (176) (1) Includes only selected information and does not represent all purchase accounting adjustments. (2) Purchase accounting marks on loans and leases includes credit, interest and liquidity components, and are generally recognized using the level-yield or straight-line method over the remaining life of the individual loans or recognized in full in the event of prepayment. (3) Purchase accounting marks on liabilities represents interest rate marks on time deposits and long-term debt and are recognized using the level-yield method over the term of the liability.
A-5 M&A related financial impacts Purchase accounting accretion Amortization of intangibles Merger-related and restructuring charges Incremental operating expenses related to the merger 1Q21 $340 $144 $141 $175 2Q21 308 142 297 190 3Q21 255 145 172 191 4Q21 237 143 212 215 1Q22 210 137 216 202 2Q22 204 143 121 117 3Q22E 170 140 10 100 4Q22E 150 140 40 60 1Q23E 120 130 No costs for the MOE No longer applicable and will not be in expense base 2Q23E 100 130 3Q23E 80 120 4Q23E 60 120 FY 2021 $1,140 $574 $822 $771 FY 2022E 734 560 387 479 FY 2023E 360 500 N/A N/A ($ MM) Amounts for future periods are based on Company projections
A-6 PPP details PPP Revenue ($ MM) PPP Yields (%) Average PPP ($ B) EOP PPP ($ B) PPP Contribution to NIM (bps) 2Q20 $55 2.6 % $8.7 $12.0 0 3Q20 78 2.6 12.1 12.2 -1 4Q20 108 3.6 11.8 10.8 3 1Q21 132 5.3 10.0 10.1 6 2Q21 124 5.7 8.7 6.0 6 3Q21 85 7.2 4.7 3.5 5 4Q21 55 8.0 2.7 2.1 3 1Q22 34 8.5 1.6 1.2 2 2Q22 21 8.8 0.9 0.7 2 FY 2020 $241 3.0% $8.2 $10.8 0 FY 2021 395 6.1 6.5 2.1 5
A-7 3Q22–2Q23 preferred stock projected dividends Estimates assume forward curve for LIBOR as of 7/1/22. Actual interest rates could vary significantly causing dividend payments to differ from the estimates shown above. Table may not foot due to rounding Truist Preferred Outstandings ($ MM) 3Q22 4Q22 1Q23 2Q23 Series I $173 $1.8 $1.7 $1.8 $1.9 Series J $102 1.0 1.0 1.1 1.2 Series L $750 9.5 11.7 12.8 13.1 Series M $500 — 12.8 — 12.8 Series N $1,700 40.8 — 40.8 — Series O $575 7.5 7.5 7.5 7.5 Series P $1,000 — 24.8 — 24.8 Series Q $1,000 25.5 — 25.5 — Series R $925 11.0 11.0 11.0 11.0 Estimated dividends based on projected interest rates and amounts outstanding ($ MM) $97.1 $70.5 $100.6 $72.3
Non-GAAP Reconciliations
A-9 Quarter Ended June 30 March 31 Dec. 31 Sept. 30 June 30 2022 2022 2021 2021 2021 Net income available to common shareholders - GAAP $ 1,454 $ 1,327 $ 1,524 $ 1,616 $ 1,559 Merger-related and restructuring charges 92 166 163 132 228 Securities (gains) losses — 53 — — — Loss (gain) on early extinguishment of debt (30) — — — (1) Incremental operating expenses related to the merger 89 155 165 147 146 Charitable contribution — — — — 153 Professional fee accrual — — — 23 — Gain on redemption of noncontrolling equity interest — (57) — — — Net income available to common shareholders - adjusted $ 1,605 $ 1,644 $ 1,852 $ 1,918 $ 2,085 Weighted average shares outstanding - diluted 1,338,864 1,341,563 1,343,029 1,346,854 1,349,492 Diluted EPS - GAAP $ 1.09 $ 0.99 $ 1.13 $ 1.20 $ 1.16 Diluted EPS - adjusted(1) 1.20 1.23 1.38 1.42 1.55 Non-GAAP reconciliations Diluted EPS ($ MM, except per share data, shares in thousands) (1) The adjusted diluted earnings per share is non-GAAP in that it excludes merger-related and restructuring charges and other selected items, net of tax. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges.
A-10 Non-GAAP reconciliations Efficiency ratio ($ MM) (1) Revenue is defined as net interest income plus noninterest income. (2) The adjusted efficiency ratio is non-GAAP in that it excludes securities gains (losses), amortization of intangible assets, merger-related and restructuring charges, and other selected items. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. Quarter Ended June 30 March 31 Dec. 31 Sept. 30 June 30 2022 2022 2021 2021 2021 Efficiency ratio numerator - noninterest expense - GAAP $ 3,580 $ 3,674 $ 3,700 $ 3,795 $ 4,011 Merger-related and restructuring charges, net (121) (216) (212) (172) (297) Gain (loss) on early extinguishment of debt 39 — 1 — — Incremental operating expense related to the merger (117) (202) (215) (191) (190) Amortization of intangibles (143) (137) (143) (145) (142) Charitable contribution — — — — (200) Professional fee accrual — — — (30) — Efficiency ratio numerator - adjusted $ 3,238 $ 3,119 $ 3,131 $ 3,257 $ 3,182 Efficiency ratio denominator - revenue(1) - GAAP $ 5,655 $ 5,325 $ 5,566 $ 5,598 $ 5,650 Taxable equivalent adjustment 28 26 24 28 28 Securities (gains) losses 1 69 — — — Gain on redemption of noncontrolling equity interest — (74) — — — Efficiency ratio denominator - adjusted $ 5,684 $ 5,346 $ 5,590 $ 5,626 $ 5,678 Efficiency ratio - GAAP 63.3 % 69.0 % 66.5 % 67.8 % 71.0 % Efficiency ratio - adjusted(2) 57.0 58.3 56.0 57.9 56.1
A-11 Non-GAAP reconciliations Pre-provision net revenue ($ MM) (1) Revenue is defined as net interest income plus noninterest income. (2) Pre-provision net revenue is a non-GAAP measure that adjusts net income determined in accordance with GAAP to exclude the impact of the provision for credit losses and provision for income taxes. Adjusted pre-provision net revenue is a non-GAAP measure that additionally excludes securities gains (losses), merger-related and restructuring charges, amortization of intangible assets, and other selected items. Truist’s management believes these measures provide a greater understanding of ongoing operations and enhances comparability of results with prior periods. Quarter Ended June 30 March 31 Dec. 31 Sept. 30 June 30 2022 2022 2021 2021 2021 Net income $ 1,532 $ 1,416 $ 1,602 $ 1,704 $ 1,658 Provision for credit losses 171 (95) (103) (324) (434) Provision for income taxes 372 330 367 423 415 Taxable-equivalent adjustment 28 26 24 28 28 Pre-provision net revenue(1)(2) $ 2,103 $ 1,677 $ 1,890 $ 1,831 $ 1,667 PPNR $ 2,103 $ 1,677 $ 1,890 $ 1,831 $ 1,667 Merger-related and restructuring charges, net 121 216 212 172 297 Gain (loss) on early extinguishment of debt (39) — (1) — — Incremental operating expense related to the merger 117 202 215 191 190 Amortization of intangibles 143 137 143 145 142 Charitable contribution — — — — 200 Professional fee accrual — — — 30 — Securities (gains) losses 1 69 — — — Gain on redemption of noncontrolling equity interest — (74) — — — Pre-provision net revenue - adjusted(1)(2) $ 2,446 $ 2,227 $ 2,459 $ 2,369 $ 2,496
A-12 Non-GAAP reconciliations Return on average assets ($ MM) (1) The adjusted performance ratios, including adjusted return on average assets, adjusted return on average common shareholders’ equity, and adjusted return on average tangible common shareholders’ equity, are non-GAAP in that they exclude merger-related and restructuring charges, selected items, and, in the case of return on average tangible common shareholders’ equity, amortization of intangible assets. Truist’s management uses these measures in their analysis of the Corporation’s performance. Truist’s management believes these measures provide a greater understanding of ongoing operations and enhance comparability of results with prior periods, as well as demonstrate the effects of significant gains and charges. These measures are not necessarily comparable to similar measures that may be presented by other companies. As of / Quarter Ended June 30 March 31 Dec. 31 Sept. 30 June 30 2022 2022 2021 2021 2021 Net income - GAAP $ 1,532 $ 1,416 $ 1,602 $ 1,704 $ 1,658 Merger-related and restructuring charges 92 166 163 132 228 Securities (gains) losses — 53 — — — Loss (gain) on early extinguishment of debt (30) — — — (1) Incremental operating expenses related to the merger 89 155 165 147 146 Charitable contribution — — — — 153 Professional fee accrual — — — 23 — Gain on redemption of noncontrolling equity interest — (57) — — — Numerator - adjusted(1) $ 1,683 $ 1,733 $ 1,930 $ 2,006 $ 2,184 Average assets $ 540,568 $ 535,981 $ 534,911 $ 526,685 $ 518,774 Return on average assets - GAAP 1.14 % 1.07 % 1.19 % 1.28 % 1.28 % Return on average assets - adjusted(1) 1.25 1.31 1.43 1.51 1.69
A-13 Non-GAAP reconciliations Calculations of tangible common equity and related measures ($ MM, except per share data, shares in thousands) (1) Tangible common equity and related measures are non-GAAP measures that exclude the impact of intangible assets, net of deferred taxes, and their related amortization. These measures are useful for evaluating the performance of a business consistently, whether acquired or developed internally. Truist’s management uses these measures to assess the quality of capital and returns relative to balance sheet risk.These measures are not necessarily comparable to similar measures that may be presented by other companies. As of / Quarter Ended June 30 March 31 Dec. 31 Sept. 30 June 30 2022 2022 2021 2021 2021 Common shareholders' equity $ 56,302 $ 58,348 $ 62,598 $ 62,227 $ 61,663 Less: Intangible assets, net of deferred taxes 29,095 29,229 28,772 27,066 26,296 Tangible common shareholders' equity(1) $ 27,207 $ 29,119 $ 33,826 $ 35,161 $ 35,367 Outstanding shares at end of period 1,326,393 1,331,414 1,327,818 1,334,892 1,334,770 Common shareholders' equity per common share $ 42.45 $ 43.82 $ 47.14 $ 46.62 $ 46.20 Tangible common shareholders' equity per common share(1) 20.51 21.87 25.47 26.34 26.50 Net income available to common shareholders $ 1,454 $ 1,327 $ 1,524 $ 1,616 $ 1,559 Plus amortization of intangibles, net of tax 109 105 110 113 107 Tangible net income available to common shareholders(1) $ 1,563 $ 1,432 $ 1,634 $ 1,729 $ 1,666 Average common shareholders' equity $ 56,803 $ 60,117 $ 61,807 $ 62,680 $ 61,709 Less: Average intangible assets, net of deferred taxes 29,173 28,905 27,523 27,149 26,366 Average tangible common shareholders' equity(1) $ 27,630 $ 31,212 $ 34,284 $ 35,531 $ 35,343 Return on average common shareholders' equity 10.3 % 9.0 % 9.8 % 10.2 % 10.1 % Return on average tangible common shareholders' equity(1) 22.7 18.6 18.9 19.3 18.9
A-14 Non-GAAP reconciliations Return on average common equity and average tangible common equity ($ MM) As of / Quarter Ended June 30 March 31 Dec. 31 Sept. 30 June 30 2022 2022 2021 2021 2021 Net income available to common shareholders - GAAP $ 1,454 $ 1,327 $ 1,524 $ 1,616 $ 1,559 Merger-related and restructuring charges 92 166 163 132 228 Securities (gains) losses — 53 — — — Loss (gain) on early extinguishment of debt (30) — — — (1) Incremental operating expenses related to the merger 89 155 165 147 146 Charitable contribution — — — — 153 Professional fee accrual — — — 23 — Gain on redemption of noncontrolling equity interest — (57) — — — Net income available to common shareholders - adjusted 1,605 1,644 1,852 1,918 2,085 Amortization 109 105 110 113 107 Net income available to common shareholders - tangible adjusted $ 1,714 $ 1,749 $ 1,962 $ 2,031 $ 2,192 Average common shareholders’ equity $ 56,803 $ 60,117 $ 61,807 $ 62,680 $ 61,709 Plus: Estimated impact of adjustments on denominator 76 158 164 151 263 Average common shareholders' equity - adjusted 56,879 60,275 61,971 62,831 61,972 Less: Average intangible assets 29,173 28,905 27,523 27,149 26,366 Average tangible common shareholders' equity - adjusted $ 27,706 $ 31,370 $ 34,448 $ 35,682 $ 35,606 Return on average common shareholders equity - GAAP 10.3 % 9.0 % 9.8 % 10.2 % 10.1 % Return on average common shareholders equity - adjusted(1) 11.3 % 11.1 % 11.9 % 12.1 % 13.5 % Return on average tangible common shareholders equity - adjusted(1) 24.8 22.6 22.6 22.6 24.7 (1) The adjusted performance ratios, including adjusted return on average assets, adjusted return on average common shareholders’ equity, and adjusted return on average tangible common shareholders’ equity, are non-GAAP in that they exclude merger-related and restructuring charges, selected items, and, in the case of return on average tangible common shareholders’ equity, amortization of intangible assets. Truist’s management uses these measures in their analysis of the Corporation’s performance. Truist’s management believes these measures provide a greater understanding of ongoing operations and enhance comparability of results with prior periods, as well as demonstrate the effects of significant gains and charges. These measures are not necessarily comparable to similar measures that may be presented by other companies.
A-15 Non-GAAP Reconciliations Operating Leverage(1) ($ MM) Quarter Ended Year-to-Date % Growth 2Q22 vs. 1Q22 % Growth Year- to-Date 2022 vs. 2021 June 30 March 31 June 30 June 30 2022 2022 2022 2021 Revenue(2) - GAAP $ 5,655 $ 5,325 $ 10,980 $ 11,132 6.2 % (1.4) % Taxable equivalent adjustment 28 26 54 56 Securities (gains) losses 1 69 70 — Gain on redemption of noncontrolling equity interest — (74) (74) — Gains on divestiture of certain businesses — — — (37) Revenue(2) - adjusted $ 5,684 $ 5,346 $ 11,030 $ 11,151 6.3 % (1.1) % Noninterest expense - GAAP $ 3,580 $ 3,674 $ 7,254 $ 7,621 (2.5) % (4.9) % Merger-related and restructuring charges, net (121) (216) (337) (438) Gain (loss) on early extinguishment of debt 39 — 39 3 Incremental operating expense related to the merger (117) (202) (319) (365) Amortization of intangibles (143) (137) (280) (286) Charitable contribution — — — (200) Acceleration for cash flow hedge unwind — — — (36) Noninterest expense - adjusted $ 3,238 $ 3,119 $ 6,357 $ 6,299 3.8 % 0.9 % Operating leverage - GAAP 8.7 % 3.5 % Operating leverage - adjusted(3) 2.5 % (2.0) % (1) Operating leverage is defined as percentage growth in revenue less percentage growth in noninterest expense. (2) Revenue is defined as net interest income plus noninterest income. (3) The adjusted operating leverage ratio is non-GAAP in that it excludes securities gains (losses), amortization of intangible assets, merger-related and restructuring charges, and other selected items. Truist’s management uses this measure in their analysis of the Corporation’s performance. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. These measures are not necessarily comparable to similar measures that may be presented by other companies.
A-16 Quarter Ended June 30 March 31 Dec. 31 Sept. 30 June 30 2022 2022 2021 2021 2021 Net interest income - GAAP $ 3,407 $ 3,183 $ 3,243 $ 3,233 $ 3,245 Taxable-equivalent adjustment 28 26 24 28 28 Net interest income - taxable-equivalent 3,435 3,209 3,267 3,261 3,273 Accretion of mark on acquired loans (189) (191) (217) (233) (285) Accretion of mark on acquired liabilities (15) (19) (20) (22) (23) Net interest income - core(1) $ 3,231 $ 2,999 $ 3,030 $ 3,006 $ 2,965 Average earning assets - GAAP $ 475,818 $ 469,940 $ 470,885 $ 461,750 $ 455,265 Average balance - mark on acquired loans 1,029 1,247 1,449 1,658 1,947 Average earning assets - core(1) $ 476,847 $ 471,187 $ 472,334 $ 463,408 $ 457,212 Annualized net interest margin: Reported - taxable-equivalent 2.89 % 2.76 % 2.76 % 2.81 % 2.88 % Core(1) 2.72 2.57 2.55 2.58 2.60 Non-GAAP reconciliations Core NIM ($ MM) (1) Core net interest margin is a non-GAAP measure that adjusts net interest margin to exclude the impact of purchase accounting. The purchase accounting marks and related amortization for loans, deposits, and long-term debt from SunTrust and other acquisitions are excluded to approximate the yields paid by clients. Truist’s management believes the adjustments to the calculation of net interest margin for certain assets and liabilities acquired provide investors with useful information related to the performance of Truist’s earning assets. These measures are not necessarily comparable to similar measures that may be presented by other companies.
A-17 Non-GAAP reconciliations Insurance Holdings adjusted EBITDA ($ MM) (1) EBITDA is a non-GAAP measurement of operating profitability that is calculated by adding back interest, taxes, depreciation, and amortization to net income. Truist’s management also adds back merger- related and restructuring charges, incremental operating expenses related to the merger, and other selected items. Truist’s management uses this measure in its analysis of the Corporation’s Insurance Holdings segment. Truist’s management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. Quarter Ended June 30 March 31 Dec. 31 Sept. 30 June 30 2022 2022 2021 2021 2021 Segment net interest income $ 28 $ 24 $ 23 $ 28 $ 25 Noninterest income 833 738 681 652 698 Total revenue $ 861 $ 762 $ 704 $ 680 $ 723 Segment net income (loss) - GAAP $ 178 $ 152 $ 127 $ 111 $ 159 Provision (benefit) for income taxes 58 50 32 31 50 Depreciation & amortization 35 31 24 31 26 EBITDA 271 233 183 173 235 Merger-related and restructuring charges, net 7 8 8 2 13 Incremental operating expenses related to the merger — — 4 3 — Adjusted EBITDA(1) $ 278 $ 241 $ 195 $ 178 $ 248 Adjusted EBITDA(1) margin 32.3 % 31.6 % 27.7 % 26.2 % 34.3 %
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