Truist Financial Corporation (TFC) Reports Better than Expected Third Quarter with $0.97 EPS
In the third quarter of 2024, Truist Financial Corporation (NYSE: TFC) demonstrated a solid financial performance, driven by significant revenue growth, disciplined expense management, and stable asset quality. The company reported a net income available to common shareholders of $1.3 billion, translating to earnings per share (EPS) of $0.99.
This performance was underpinned by a 2.2% increase in net interest income, reaching $3.66 billion, and a 3.1% rise in noninterest income, amounting to $1.48 billion. The total revenue on a taxable-equivalent basis was $5.14 billion, marking an improvement from previous quarters.
Truist’s net interest margin increased by 10 basis points, reaching 3.12%, which reflects the company’s strategic focus on balance sheet optimization. The average deposits decreased by 1.0%, primarily due to declines in time and noninterest-bearing deposits, partially offset by an increase in money market and savings deposits. The company’s asset quality remains robust, with nonperforming loans to total loans up marginally by two basis points, and a net charge-off ratio of 0.55%, down three basis points from the previous quarter.
Truist also maintained strong capital and liquidity positions, with a Common Equity Tier 1 (CET1) ratio of 11.6% and a consolidated average Liquidity Coverage Ratio (LCR) of 112%. The company repurchased $500 million in common shares, resulting in dividend and total payout ratios of 52% and 90%, respectively. This financial stability and strategic capital management reflect Truist’s commitment to delivering value to its shareholders.
Truist Financial Corp Reports Better than Expected Third Quarter
Truist’s third-quarter performance exceeded market expectations, with an EPS of $0.99 surpassing the anticipated $0.91.
The company’s total revenue of $5.14 billion also outperformed the expected $5.09 billion, showcasing its ability to generate higher-than-expected financial outcomes. The increase in net interest income and noninterest income contributed significantly to this positive variance, highlighting the company’s effective revenue generation strategies.
The company’s adjusted diluted EPS was $0.97, aligning closely with the market’s expectations and reflecting the adjustments made for significant items. The adjusted pre-provision net revenue (PPNR) increased by 4.4% to $2.31 billion, indicating strong operational performance and cost management. Despite a decrease in average loans and leases, the company’s focus on high-yielding securities and other earning assets supported its revenue growth.
Truist’s expense management was evident in the 5.4% reduction in noninterest expenses, driven by lower personnel expenses and restructuring charges. The adjusted noninterest expense increased slightly by 0.9%, reflecting higher professional fees and outside processing expenses. These outcomes underscore Truist’s ability to control costs while investing in technology and infrastructure to drive future growth.
Guidance and Future Outlook
Truist remains optimistic about its financial prospects, with a focus on driving revenue growth through its core banking business. The company aims to continue deepening client relationships, expanding its client base, and investing in technology and infrastructure. Truist’s commitment to maintaining strong expense discipline and asset quality will be pivotal in achieving its strategic objectives.
Truist’s management anticipates that the ongoing balance sheet optimization and investments in higher-yielding assets will support future net interest income growth. The company is also focused on enhancing its noninterest income streams, particularly in investment banking, trading, and wealth management. These efforts are expected to contribute to sustained revenue growth and profitability in the coming quarters.
The company is also committed to returning capital to shareholders through dividends and share repurchases, as evidenced by the $1.2 billion returned during the third quarter.
Disclaimer: The author does not hold or have a position in any securities discussed in the article.
Back to 
