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TRUIST FINANCIAL CORP (TFC)·Q3 2025 Earnings Summary

Executive Summary

  • Truist delivered a solid Q3 with diluted EPS of $1.04 and GAAP revenue of $5.19B, driven by an 11% rebound in noninterest income (investment banking & trading and wealth) and broad-based loan growth; ROTCE rose to 13.6% and the efficiency ratio improved sequentially .
  • Against S&P Global consensus, EPS beat by roughly $0.05 while revenue was essentially in line; management guided Q4 adjusted revenue up 1–2% QoQ and net interest income up ~2% QoQ, with expected margin expansion .
  • Credit remained disciplined: NCO ratio fell to 0.48% QoQ and provision declined to $436mm; CET1 stayed strong at 11.0% (CET1 incl. AOCI 9.4%) .
  • Capital return accelerated: $500mm buybacks in Q3 with a target of ~$750mm in Q4; common dividend maintained at $0.52 per share (declared Oct 28) .
  • Near-term catalysts: fee momentum in IB/trading, Premier/Wealth growth, deposit beta relief amid rate cuts, and increased buybacks underpin the trajectory toward a mid-teens ROTCE by 2027 .

What Went Well and What Went Wrong

  • What Went Well

    • Strong fee recovery: investment banking & trading income rose 58% QoQ to $323mm; wealth management income up 7.5% QoQ to $374mm, producing the best noninterest income quarter since TIH divestiture .
    • Broad loan growth and operating leverage: average loans +2.5% QoQ; adjusted PPNR +7.4% QoQ; adjusted efficiency ratio improved to 55.7% .
    • Management confidence and strategic execution: “robust fee income growth… healthy loan expansion… continued expense and credit discipline,” positioning to “accelerate performance” and “drive long-term shareholder value” (Bill Rogers) .

  • What Went Wrong

    • Deposit headwinds: average deposits fell 1.0% QoQ, partly due to withdrawal of two short-term M&A-related client deposits; interest checking down 6% QoQ .
    • Slight revenue/NIM pressure: NIM dipped by 1 bp QoQ to 3.01%; GAAP revenue grew but TE NIM was down vs last year .
    • Asset quality mixed signals: nonperforming loans as % of LHFI rose from 0.39% to 0.48% QoQ; management noted specific C&I/construction items and acknowledged First Brands exposure is reserved within guidance .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Revenue ($USD Billions)$5.09 $4.99 $5.19
Net Interest Income TE ($USD Billions)$3.66 $3.64 $3.68
Noninterest Income ($USD Billions)$1.48 $1.40 $1.56
Noninterest Expense ($USD Billions)$2.93 $2.99 $3.01
Diluted EPS ($USD)$0.99 $0.90 $1.04
ROTCE (%)13.8% 12.3% 13.6%
Efficiency Ratio - Unadj (%)57.5% 59.9% 58.1%

Actual vs Consensus (Q3 2025)

MetricActualConsensus
Diluted EPS ($USD)$1.04 $0.99*
Revenue ($USD Billions)$5.19 $5.20*

Values marked with * retrieved from S&P Global.

Segment Results

SegmentQ3 2024 Net Income ($mm)Q2 2025 Net Income ($mm)Q3 2025 Net Income ($mm)
Consumer & Small Business Banking$776 $601 $663
Wholesale Banking$1,040 $933 $1,150
Other, Treasury & Corporate($377) ($294) ($361)

Noninterest Income Mix ($mm)

Noninterest IncomeQ3 2024Q2 2025Q3 2025
Wealth Management Income350 348 374
Investment Banking & Trading332 205 323
Service Charges on Deposits221 227 240
Card & Payment Related Fees222 232 225
Mortgage Banking Income106 107 118
Lending Related Fees88 99 103
Operating Lease Income49 47 45
Securities Gains (Losses)— (18) —
Other Income115 153 130

Key KPIs

KPIQ3 2024Q2 2025Q3 2025
Net Interest Margin (TE, %)3.12 3.02 3.01
NCO Ratio (%)0.55 0.51 0.48
Provision for Credit Losses ($mm)448 488 436
CET1 Ratio (%)11.6 11.0 11.0
Avg Loans HFI ($USD Billions)$303.17 $312.60 $320.49
Avg Deposits ($USD Billions)$384.34 $400.48 $396.60

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted Revenue (TE) Growth vs 2024FY 2025+1.5% to +2.5% Unchanged Maintained
Adjusted Expenses Growth vs 2024FY 2025~+1% ~+1% Maintained
Net Charge-Off RatioFY 202555–60 bps 55 bps Lowered
Effective Tax RateFY 2025~17.5% (20% TE) ~17.5% (20% TE) Maintained
Net Interest Income QoQQ4 2025N/A~+2% QoQ New
Adjusted Revenue QoQQ4 2025N/A+1% to +2% QoQ New
Share RepurchasesQ4 2025$500mm (Q3 plan) ~$750mm target Raised
DividendQ4 2025$0.52 declared prior $0.52 declared Oct 28 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2)Current Period (Q3 2025)Trend
AI/Technology & DigitalQ2: RTP alias approval; digital account production +17% YoY; treasury management revenue +14% YoY Plan to build 100 “insight-driven” branches with AI-driven engagement; Truist Assist handled 1.3mm conversations, 81% resolution Accelerating adoption/investment
Deposit Pricing & BetasQ2: Cum. interest-bearing beta fell to 37%; deposit growth aided by temp $10.9B deposits Beta to mid-40s in Q4; avg deposits −1% QoQ due to M&A-related withdrawals; client deposit growth expected Improving pricing; core deposits building
Investment Banking & TradingQ2: Weak April; normalized in May/June; H2 recovery expected +58% QoQ to $323mm; strong pipelines into Q4 Rebound underway
Fixed-Rate Asset RepricingQ2: ~$27B to reprice thru 2025; run-on ~7% vs run-off ~6.4% Q4: ~$11B loans & ~$3B securities to reprice; run-on ~7%; swaps: $105B receive-fixed notional Tailwind moderating over time
Premier/WealthQ2: Premier production up; Wealth AUM +27% YTD from Wholesale/Premier Wealth fees +7.5% QoQ; strong net flows and new clients Continued growth
Regulatory/CapitalQ2: SCB floored at 2.5% from Oct 1; CET1 11% CET1 11.0%; CET1 incl. AOCI 9.4%; target 10% by YE 2027 with buybacks Stable CET1; buyback glidepath
Credit/Portfolio ExposuresQ2: NPLs at multi-quarter lows; CRE office down ~$500mm NPL% up to 0.48%; First Brands exposure reserved; NDFI ~11% of loans, diversified with IG characteristics Mixed: generally stable with idiosyncrasies

Management Commentary

  • CEO perspective: “strong third-quarter results, underscored by robust fee income growth… healthy loan expansion, and continued expense and credit discipline… clear strategic focus on growth… positions us well to accelerate performance, return capital… and drive long-term shareholder value” — Bill Rogers .
  • Strategic outlook: Revenue growth, operating leverage, share repurchases, and EPS growth expected to increase in 2026; targeting 15% ROTCE in 2027 with growth initiatives, positive operating leverage, repricing tailwind, and buybacks .
  • Funding/margin: Expect NII ~+2% QoQ in Q4 with deposit growth and lower deposit costs; net interest margin expansion anticipated on lower rates and mix improvements .

Q&A Highlights

  • Deposits and betas: Management expects interest-bearing beta to mid-40s in Q4, aided by rate cuts and core mix; strong leading indicators in treasury pipelines and Premier/Wholesale relationships .
  • Buybacks: ~$750mm Q4 target seen as a floor with flexibility to lean in, balanced against capital and growth needs; steady buyback glidepath toward ~10% CET1 by end-2027 .
  • Margin trajectory: NIM targeted to progress toward “three-teens” over 2026–2027 with repricing, deposit growth, and business mix improvements .
  • Credit questions: First Brands exposure reserved; nonaccrual rise reflects return to recent levels; consumer subprime largely contained to auto; NDFI ~11% of loans, diversified, high-quality collateral .
  • Efficiency vs growth: Efficiency ratio not the primary driver of ROTCE walk; continued investment in growth areas (Premier, Payments, Wealth, talent/tech) while maintaining cost discipline .

Estimates Context

  • Q3 2025 EPS beat: Actual diluted EPS $1.04 vs S&P Global consensus $0.99*; Q3 2025 revenue was $5.19B vs consensus $5.20B* (essentially in line) .
  • Consensus depth: Revenue estimates count 11*; EPS estimates count 17*; EBITDA consensus $1.82B* (not directly comparable to reported GAAP) (S&P Global).

Consensus vs Actual Detail

MetricQ3 2025 ActualQ3 2025 Consensus# of Estimates
Diluted EPS ($USD)$1.04 $0.99*17*
Revenue ($USD Billions)$5.19 $5.20*11*
EBITDA ($USD Billions)N/A (GAAP not provided)$1.82*N/A

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Fee engine is back: IB/trading and wealth drove a sizable noninterest income rebound; pipelines support continued strength into Q4, aiding operating leverage .
  • NII and margin set to improve: Q4 NII guided ~+2% QoQ with expected NIM expansion on lower deposit costs and ongoing repricing .
  • Capital deployment tailwind: Buybacks accelerated ($500mm in Q3; ~$750mm targeted in Q4) with dividend at $0.52, supporting EPS and ROTCE trajectory .
  • Credit remains disciplined despite idiosyncrasies: NCO down QoQ/YoY; NPL% up to 0.48% but reserved exposures and diversified portfolios mitigate risk .
  • Deposit mix and growth are improving: Despite M&A-related withdrawals impacting averages, leading indicators (Premier, treasury management) point to core growth in Q4/2026 .
  • Strategic investments support medium-term thesis: AI-enabled branches, digital engagement, and Payments/Wealth expansion drive sustainable fee growth and relationship depth .
  • Watch estimate revisions: EPS beat and fee momentum may pull up near-term EPS/fee estimates, while NII/NIM guidance creates upside if rate cuts proceed as expected .

Additional Q3-Period Press Releases (Context)

  • Declared common dividend of $0.52 per share (payable Dec 1; record Nov 14) .
  • Announced redemption of $750mm fixed-to-floating senior notes due 2026 on Oct 28, 2025 .
  • Continued talent and capability investments in payments, wealth, and corporate banking across Q3-related announcements .

Notes:

  • Non-GAAP items: Restructuring charges of $27mm in Q3 (~$0.02 EPS); adjusted efficiency ratio 55.7%; adjusted PPNR $2.25B with reconciliations in the earnings materials .
  • Deposits: Average deposits −1.0% QoQ due to withdrawal of two short-term client deposits; management emphasized core client deposit momentum into Q4 .
  • CET1 including AOCI stood at 9.4% (vs 11.0% CET1), reflecting securities/AOCI adjustments; target CET1 ~10% by YE 2027 with increased repurchases .