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TRUIST FINANCIAL CORP (TFC)·Q2 2025 Earnings Summary

Executive Summary

  • Truist delivered GAAP diluted EPS of $0.90 and adjusted diluted EPS of $0.91; TE revenue rose 1.8% QoQ to $5.035B, driven by 2.3% growth in TE NII and stable NIM at 3.02% .
  • Results vs S&P Global Wall Street consensus: EPS modestly below $0.93 and revenue below ~$5.03B; adjusted revenue (TE) of $5.053B rose 0.7% QoQ and 0.7% YoY excluding 2Q24 securities losses, but investment banking/trading was softer QoQ (down $68M) . Bold miss: EPS slightly below consensus; revenue below consensus (Consensus figures from S&P Global)*.
  • Asset quality improved: NCO ratio fell to 0.51% (down 9 bps QoQ; down 7 bps YoY); NPLs/loans dipped to 0.39%; CET1 decreased to 11.0% as Truist repurchased $750M in shares and paid its dividend .
  • Guidance: FY25 outlook unchanged (adjusted revenue +1.5–2.5%, adjusted expenses ~+1%, NCO 55–60 bps, tax rate ~17.5% effective/20% FTE); 3Q25 guide implies adjusted revenue +2.5–3.5% QoQ, NII +~2%, noninterest income +~5%, adjusted expenses +~1% and ~$500M buybacks .
  • Catalysts: Improved CCAR results and preliminary SCB floored at 2.5% effective 10/1/25; capital return (buybacks/dividend) and expected 2H25 recovery in investment banking/trading .

What Went Well and What Went Wrong

What Went Well

  • Linked-quarter growth and margin stability: TE NII rose 2.3% QoQ; NIM ticked up 1 bp to 3.02%; adjusted revenue (TE) up 2.1% QoQ .
  • Loan and deposit momentum: Average loans +2.0% QoQ (HFI +$6.2B); EOP loans +3.3% ($318.8B); average deposits +2.1% QoQ ($400.5B) .
  • Management execution and tone: “We delivered strong second-quarter results,” citing strategic loan growth, higher NII, strong asset quality and capital return, with continued investments in talent and technology (Bill Rogers, CEO) .

What Went Wrong

  • Capital markets softness: Investment banking & trading income fell $68M QoQ (down ~25%), moderated by improvement late in the quarter; CFO noted April weakness with normalization by May/June .
  • Expense pressure: Adjusted noninterest expense rose 3.1% QoQ, driven by personnel; efficiency ratio (adjusted) increased 70 bps QoQ to 57.1% .
  • Revenue vs consensus: GAAP revenue of $4.987B below consensus (~$5.03B)*, with adjusted noninterest income down 1.4% YoY excluding prior-year securities losses .

Financial Results

MetricQ2 2024Q1 2025Q2 2025 ActualQ2 2025 Consensus*
Revenue (GAAP, $B)$(1.685) $4.899 $4.987 $5.026*
Revenue (TE, $B)$(1.632) $4.947 $5.035 —
Adjusted Revenue (TE, $B)$5.018 $4.948 $5.053 —
Diluted EPS (GAAP, $)$0.62 $0.87 $0.90 $0.93*
Adjusted Diluted EPS ($)$0.91 $0.87 $0.91 —
NIM (TE, %)3.02 3.01 3.02 —
Efficiency Ratio (Adjusted, %)56.0 56.4 57.1 —
NCO Ratio (%)0.58 0.60 0.51 —
CET1 Ratio (%)11.6 11.3 11.0 —

Values retrieved from S&P Global where marked with an asterisk.*

Segment (Noninterest Income, $MM):

CategoryQ2 2024Q1 2025Q2 2025
Wealth Management Income361 344 348
Investment Banking & Trading286 273 205
Card & Payment Fees230 220 232
Service Charges on Deposits232 230 227
Mortgage Banking112 108 107
Lending Related Fees89 95 99
Operating Lease Income50 53 47
Securities Gains (Losses)(6,650) (1) (18)
Other Income78 70 153
Total Noninterest Income$(5,212) $1,392 $1,400

KPIs:

KPIQ2 2024Q1 2025Q2 2025
Avg Loans & Leases HFI ($B)$306.2 $306.4 $312.6
EOP Loans & Leases HFI ($B)$307.1 $309.8 $318.8
Avg Deposits ($B)$388.0 $392.2 $400.5
TBVPS ($)$28.91 $30.95 $31.63
Fee Income Ratio (Adjusted, %)28.7 28.2 28.1

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted Revenue (TE)3Q25 QoQ—Up ~2.5% to 3.5%New near-term guide
Net Interest Income3Q25 QoQ—Up ~2%New near-term guide
Noninterest Income3Q25 QoQ—Up ~5%New near-term guide
Adjusted Expenses3Q25 QoQ—Up ~1%New near-term guide
Share Repurchases3Q25—~$500MContinued capital return
Adjusted Revenue (TE)FY25 YoYUp 3.0–3.5% (Q4’24 outlook) Up 1.5–2.5% (Q1’25 updated; unchanged in Q2) Lowered in Q1; maintained in Q2
Adjusted ExpensesFY25 YoY~+1.5% (Q4’24 outlook) ~+1% (Q1’25 updated; unchanged in Q2) Lowered in Q1; maintained in Q2
Net Charge-off RatioFY25~60 bps (Q1’25) 55–60 bps (Q2’25) Slight improvement
Effective Tax RateFY25~17% effective; 20% FTE (Q1’25) ~17.5% effective; 20% FTE (Q2’25) Slightly higher
SCBOct 1, 2025–Sep 30, 2026—2.5% preliminary SCB; CET1 min = 7.0%New requirement
DividendOngoing$0.52 per share$0.52 per share (declared 7/29/25)Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4’24 and Q1’25)Current Period (Q2’25)Trend
Investment Banking & TradingQ4: Lower originations and M&A; Q1: revised FY25 fee outlook to flat YoY; April softness noted April losses on trading; May/June normalized; expect 2H recovery; IB improved in 2H of quarter Improving into 2H25
Deposit Costs & BetasQ1: Down-rate betas declined; surgical pricing tools in use; total deposit cost 1.79% Cumulative interest-bearing beta declined from 43% to 37%; expect mid-40s by year-end with two cuts Easing; disciplined pricing
Digital & RTP AliasQ1: Zelle disbursements, digital production +13% YoY; Truist Assist scaling First bank to approve requests for payment via alias (cell/email) on RTP; treasury management fees +14% YoY Product-led growth
Loan Growth / Middle MarketQ4: EOP loans up; focus on middle market; Q1: low single-digit EOP growth targeted Avg loans +2% QoQ; growth broad-based C&I/consumer; more middle-market/new clients Strong, production-led
Expense Discipline / RestructuringQ4: Adjusted expenses +4% QoQ; Q1: lowered FY25 expense outlook; limited restructuring Adjusted expenses +3.1% QoQ; bulk of restructuring ($28M) was severance; FY25 expense target intact Investing with discipline
Capital & SCBQ4: CET1 11.5%; capital return; AOCI accretion runway CET1 11.0%; SCB to 2.5% floor; target ~$500M buybacks in 3Q Strong capacity; returns continuing

Management Commentary

  • “We delivered strong second-quarter results, driven by strategic loan growth and higher net interest income… Asset quality remained strong, and our strong capital position continues to support both our growth initiatives and our ability to return capital to shareholders.” — Bill Rogers, Chairman & CEO .
  • “Taxable equivalent net interest income increased 2.3% linked quarter… We expect to reprice approximately $27 billion of fixed rate loans and investment securities over the remainder of 2025… new fixed rate loans will have a run-on rate of around 7% vs. run-off ~6.4%.” — Mike Maguire, CFO .
  • “We believe that our investment banking and trading business is well-positioned for a second-half recovery… April was weak; May and June normalized.” — Mike Maguire, CFO .
  • “Our deposit franchise is performing well… we expect betas to move closer to ~40% in 3Q and mid-40s by year-end, with two rate cuts.” — Mike Maguire, CFO .

Q&A Highlights

  • Deposit competitiveness and betas: Management expects deposit betas to decline and balances to be slightly lower in 3Q due to withdrawal of short-term deposits, with pricing improvement ahead of potential cuts .
  • Share repurchases pacing: $750M in 2Q was opportunistic; targeting ~$500M in 3Q alongside dividends (~100% total payout), while gliding CET1 toward ~10% medium-term .
  • NIM “normalized”: Management aims for “three-teens” NIM over time if conditions remain normal, driven by repricing and funding mix improvements .
  • Loan growth drivers and utilization: Production-led growth across C&I and consumer; utilization broadly stable; potential for higher paydowns as capital markets re-open, with high capture rates expected .
  • Investment banking/trading trajectory: April softness; normalization in May/June and into July; confidence in 3Q/4Q improvement given pipelines .

Estimates Context

MetricQ2 2025 ActualQ2 2025 Consensus*Surprise
Diluted EPS ($)$0.90 $0.93*Miss
Revenue (GAAP, $B)$4.987 $5.026*Miss

Values retrieved from S&P Global where marked with an asterisk.*
Context: Adjusted revenue (TE) was $5.053B (+2.1% QoQ), but softer IB/trading and higher personnel expenses weighed on GAAP revenue and EPS relative to consensus .

Key Takeaways for Investors

  • Underlying core banking momentum (NII +2.3% QoQ; NIM +1 bp) and strong loan/deposit growth offset capital markets softness; watch the expected 2H25 IB/trading recovery for upside risk .
  • Credit remains a tailwind: NCO ratio down to 0.51%, improved CRE outlook (office down ~$500M QoQ), ALLL coverage robust; FY25 NCO guide refined to 55–60 bps .
  • Expenses are elevated near-term from talent/tech investments; FY25 adjusted expense growth still ~1%, supporting positive operating leverage in 2H25 .
  • Capital return intact: CET1 11.0% with SCB at 2.5% from Oct 1; dividend maintained at $0.52/share and buybacks targeted at ~$500M in 3Q25 .
  • Deposit betas easing and pricing discipline should support margin resilience amid potential rate cuts; management targets “three-teens” NIM longer term .
  • Digital/payments initiatives (RTP alias, Merchant Engage platform) drive treasury fee growth (+14% YoY) and deepen client penetration — medium-term revenue enhancer .
  • Near-term trading: Focus on monthly progression and 3Q guide (adjusted revenue +2.5–3.5%) as catalysts; upside if capital markets activity accelerates .

Notes:

  • TE = Taxable-Equivalent. Adjusted figures exclude securities gains/losses, restructuring, amortization, and selected items as defined by Truist .
  • Values marked with an asterisk (*) are retrieved from S&P Global (Wall Street consensus).