Truist Financial Corporation (TFC) Bundle
A Brief History of Truist Financial Corporation
As of 2024, Truist Financial Corporation, formed from the merger of BB&T and SunTrust Banks in December 2019, continues to establish itself as a major player in the banking industry. The company operates with a strong focus on community banking, wealth management, and insurance services.
Financial Performance Overview
For the third quarter of 2024, Truist reported a net income of $1.4 billion, a significant increase compared to $1.1 billion in the same quarter of 2023. Earnings per diluted share rose to $0.99, up from $0.80 year-over-year.
Net interest income for the same quarter was $3.6 billion, with a net interest margin of 3.12%, reflecting a 20 basis point improvement from the prior year. The average yield on the total loan portfolio was 6.41%, while the average cost of total deposits increased to 2.08%.
Balance Sheet Highlights
As of September 30, 2024, Truist's total assets were reported at $525.7 billion. The company's total shareholders' equity stood at $65.7 billion, which marked an increase from $59.3 billion at the end of 2023.
| Financial Metrics | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Income | $1.4 billion | $1.1 billion |
| Earnings Per Share (EPS) | $0.99 | $0.80 |
| Net Interest Income | $3.6 billion | $3.5 billion |
| Net Interest Margin | 3.12% | 2.92% |
| Total Assets | $525.7 billion | $557.7 billion |
| Shareholders' Equity | $65.7 billion | $59.3 billion |
Dividends and Shareholder Returns
In the third quarter of 2024, Truist returned approximately $1.2 billion to shareholders through common stock dividends and share repurchases. The dividend payout ratio for this period was 52%, while the total payout ratio reached 90%.
Strategic Initiatives
Truist has emphasized its commitment to technology and infrastructure enhancement, appointing a new Chief Information Officer in October 2024 to lead its enterprise technology initiatives. The company has also focused on risk management and compliance, adapting to evolving regulatory requirements.
Market Position
With a robust presence in the Southeast and Mid-Atlantic regions of the United States, Truist ranks as one of the largest financial institutions in the country, providing a wide array of financial services to its clients, including retail and commercial banking, investment services, and insurance.
A Who Owns Truist Financial Corporation (TFC)
Major Shareholders
As of September 30, 2024, the major shareholders of Truist Financial Corporation include institutional investors and individual shareholders. The top institutional shareholders are:
| Institution | Shares Owned (millions) | Percentage of Total Shares |
|---|---|---|
| The Vanguard Group, Inc. | 120.2 | 9.05% |
| BlackRock, Inc. | 110.5 | 8.30% |
| State Street Corporation | 85.6 | 6.43% |
| Wellington Management Group LLP | 50.3 | 3.78% |
| Fidelity Investments | 45.1 | 3.40% |
Insider Ownership
Insider ownership at Truist Financial Corporation is significant, with the following key executives holding shares:
| Name | Position | Shares Owned (thousands) |
|---|---|---|
| William H. Rogers Jr. | Chairman & CEO | 1,200 |
| John A. McGowan | President | 950 |
| Kimberly A. Smith | Chief Financial Officer | 600 |
| David R. McNabb | Chief Risk Officer | 450 |
| Brent C. Smith | Chief Operating Officer | 350 |
Shareholder Equity
As of September 30, 2024, Truist Financial Corporation reported total shareholders' equity of $65.7 billion, with a book value per common share of $44.46, up from $39.31 at the end of 2023. The tangible book value per share was $30.64, compared to $21.83 at the end of 2023.
| Metric | Value (as of Sep 30, 2024) | Value (as of Dec 31, 2023) |
|---|---|---|
| Total Shareholders' Equity | $65.7 billion | $59.3 billion |
| Book Value per Common Share | $44.46 | $39.31 |
| Tangible Book Value per Share | $30.64 | $21.83 |
Market Capitalization
As of September 30, 2024, the market capitalization of Truist Financial Corporation stood at approximately $100 billion, reflecting its position in the financial services sector.
Recent Stock Performance
The stock price of Truist Financial Corporation (TFC) as of September 30, 2024, was $75.35, showing an increase from its price of $68.50 at the beginning of the year.
Dividend Information
Truist Financial Corporation declared a cash dividend of $0.52 per share during the third quarter of 2024, maintaining a dividend payout ratio of 52%.
| Dividend Type | Amount per Share | Payout Ratio |
|---|---|---|
| Common Dividend | $0.52 | 52% |
Ownership Trends
Over the past year, institutional ownership has seen an increase, with major investors like The Vanguard Group and BlackRock expanding their stakes in Truist Financial Corporation. The overall trend indicates a growing interest in the company within the investment community.
Truist Financial Corporation (TFC) Mission Statement
Mission Statement Overview
Truist Financial Corporation's mission is to inspire and build better lives and communities. The company focuses on delivering high-quality financial services while maintaining a strong commitment to responsible banking and community development. This mission is reflected in their operational strategies and customer engagement practices.
Core Values
- Customer-Centric Approach: Truist prioritizes the needs and experiences of its customers in every aspect of its business.
- Integrity: The company emphasizes ethical conduct and transparency in its operations.
- Teamwork: Collaboration among employees is encouraged to achieve common goals.
- Community Engagement: Truist actively participates in initiatives that strengthen the communities it serves.
Financial Performance and Metrics
As of September 30, 2024, Truist Financial Corporation reported significant financial metrics that reflect its operational health and mission alignment:
| Financial Metric | Value (Q3 2024) |
|---|---|
| Net Income Available to Common Shareholders | $1.336 billion |
| Earnings Per Share (Diluted) | $0.99 |
| Return on Average Assets | 1.10% |
| Return on Average Common Shareholders' Equity | 9.1% |
| Total Assets | $1.2 trillion |
| Total Shareholders' Equity | $65.7 billion |
| Common Dividends Declared Per Share | $0.52 |
| Total Capital Ratio | 15.3% |
Community and Social Responsibility
Truist's mission extends beyond financial performance; it actively seeks to contribute to the welfare of the communities it serves. The company invests in various community initiatives, focusing on areas such as education, housing, and economic development. In the third quarter of 2024, Truist reported a total of $1.2 billion returned to shareholders, which includes common stock dividends and share repurchases, reflecting its commitment to sustainable growth and community support.
Strategic Goals Aligned with Mission
- Invest in Technology: Truist aims to enhance customer experience through digital banking solutions.
- Expand Community Engagement: The company plans to deepen its involvement in local communities through various philanthropic efforts.
- Foster Employee Development: Truist is committed to investing in its workforce to ensure high levels of service and engagement.
Conclusion
Truist Financial Corporation's mission to inspire and build better lives and communities is supported by its strong financial performance, commitment to ethical practices, and active community engagement initiatives. The alignment of its strategic goals with its core mission continues to position Truist as a leader in the financial services industry.
How Truist Financial Corporation (TFC) Works
Overview of Truist Financial Corporation
Truist Financial Corporation (TFC) is one of the largest financial services holding companies in the United States, offering a wide range of banking and financial services. As of September 30, 2024, Truist had total assets of approximately $548.4 billion.
Financial Performance
For the third quarter of 2024, Truist reported net income available to common shareholders of $1.3 billion, representing a 25% increase compared to the same period in 2023. Earnings per share (EPS) for the quarter were $0.99, up from $0.80 in the prior year. The annualized return on average assets was 1.10%, while the return on average common shareholders’ equity was 9.1%.
Net Interest Income and Margin
Taxable-equivalent net interest income for the third quarter of 2024 was $3.85 billion, an increase of $65 million, or 1.8%, from the same quarter in 2023. The net interest margin (NIM) improved to 3.12%, up 20 basis points year-over-year.
| Financial Metrics | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Net Income | $1.3 billion | $1.04 billion | +25% |
| Earnings per Share (EPS) | $0.99 | $0.80 | +24% |
| Return on Average Assets | 1.10% | 0.86% | +24% |
| Return on Average Common Equity | 9.1% | 7.5% | +21% |
| Net Interest Margin | 3.12% | 2.92% | +20 bps |
Asset Quality
Truist's asset quality remained strong, with nonperforming loans and leases held for investment at 0.48% of total loans as of September 30, 2024. The allowance for credit losses was $5.1 billion, which includes $4.8 billion for loan and lease losses.
Deposits and Borrowings
Average total deposits for the third quarter of 2024 were $384.3 billion, a decrease of $3.7 billion, or 1.0%, compared to the prior quarter. The average cost of total deposits was 2.08%, up 24 basis points.
| Deposit Metrics | Q3 2024 | Q2 2024 | % Change |
|---|---|---|---|
| Total Average Deposits | $384.3 billion | $388.0 billion | -1.0% |
| Average Cost of Total Deposits | 2.08% | 1.84% | +24 bps |
| Average Short-term Borrowings | $24.3 billion | $29.1 billion | -17% |
| Long-term Debt | $36.8 billion | $38.9 billion | -5.4% |
Capital Ratios
Truist maintained strong capital ratios, with a Common Equity Tier 1 (CET1) ratio of 11.6% as of September 30, 2024. The Tier 1 capital ratio was 13.2%, and the total capital ratio stood at 15.3%.
| Capital Ratios | September 30, 2024 | December 31, 2023 |
|---|---|---|
| CET1 Ratio | 11.6% | 10.1% |
| Tier 1 Capital Ratio | 13.2% | 11.6% |
| Total Capital Ratio | 15.3% | 13.7% |
| Leverage Ratio | 10.8% | 9.3% |
Shareholder Returns
During the third quarter of 2024, Truist declared common dividends of $0.52 per share and repurchased $500 million of common stock. The dividend payout ratio was 52%, and the total payout ratio was 90%.
Investment Activities
As of September 30, 2024, Truist's securities portfolio totaled $115.6 billion. The company executed a strategic balance sheet repositioning, selling $27.7 billion of lower-yielding investment securities.
| Securities Portfolio | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Securities | $115.6 billion | $121.5 billion |
| U.S. Treasury Securities | $12.986 billion | $10.886 billion |
| Agency MBS | $103.374 billion | $120.717 billion |
| Other Securities | $1.24 billion | $1.897 billion |
Risk Management Framework
Truist maintains a comprehensive risk management framework to identify, measure, monitor, and manage significant risks from its business activities. This includes a risk taxonomy to facilitate internal risk measurement and monitoring.
How Truist Financial Corporation (TFC) Makes Money
Net Interest Income
Truist Financial Corporation generates significant revenue through net interest income, which is the difference between interest earned on loans and interest paid on deposits. For the third quarter of 2024, taxable-equivalent net interest income was $3.63 billion, an increase of $65 million, or 1.8%, compared to the same quarter in 2023. The net interest margin stood at 3.12%, reflecting a 20 basis point increase year-over-year.
Loan Portfolio Performance
The yield on the average total loan portfolio for the third quarter of 2024 was 6.41%, up 16 basis points from the previous year. The average loans held for investment decreased by $3.0 billion, or 1.0%, compared to the prior quarter, with the commercial and industrial portfolio showing a notable decline.
| Loan Type | Average Loans HFI (in millions) | Yield (%) |
|---|---|---|
| Commercial and Industrial | $154,102 | 6.41 |
| Commercial Real Estate | $21,481 | 6.88 |
| Residential Mortgage | $53,999 | 3.89 |
| Home Equity | $9,850 | 6.29 |
| Indirect Auto | $22,121 | 4.92 |
Noninterest Income
Noninterest income for the third quarter of 2024 totaled $1.48 billion, reflecting an increase of $149 million, or 11%, compared to the third quarter of 2023. This growth was primarily driven by higher investment banking and trading income, service charges on deposits, and wealth management income.
| Source of Noninterest Income | Q3 2024 (in millions) | Q3 2023 (in millions) | % Change |
|---|---|---|---|
| Wealth Management Income | $350 | $343 | 2.0 |
| Investment Banking and Trading Income | $332 | $185 | 79.5 |
| Service Charges on Deposits | $221 | $154 | 43.5 |
| Mortgage Banking Income | $106 | $102 | 3.9 |
Expense Management
Noninterest expenses for the third quarter of 2024 were $3.36 billion, a decrease of $133 million, or 4.3%, compared to the same period in 2023. This reduction was attributed to decreased personnel expenses and lower restructuring charges.
| Type of Expense | Q3 2024 (in millions) | Q3 2023 (in millions) | % Change |
|---|---|---|---|
| Personnel Expense | $1,628 | $1,669 | (2.5) |
| Professional Fees | $336 | $289 | 16.3 |
| Marketing Expense | $75 | $70 | 7.1 |
| Net Occupancy Expense | $157 | $164 | (4.3) |
Capital Management and Shareholder Returns
As of September 30, 2024, Truist's total shareholders’ equity was $65.7 billion, increasing from $59.3 billion at the end of 2023. The company declared common dividends of $0.52 per share for the third quarter, maintaining a dividend payout ratio of 52%. Truist also repurchased $500 million of common stock during the same period.
Credit Quality and Allowance for Credit Losses
The allowance for credit losses was reported at $5.1 billion as of September 30, 2024. The net charge-off ratio was 55 basis points, reflecting a slight increase compared to the third quarter of 2023. Nonperforming loans and leases were 0.48% of loans and leases held for investment.
| Credit Quality Metric | Value |
|---|---|
| Allowance for Credit Losses (in millions) | $5,100 |
| Net Charge-Off Ratio (%) | 0.55 |
| Nonperforming Loans Ratio (%) | 0.48 |
Truist Financial Corporation (TFC) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Article updated on 8 Nov 2024
Resources:
- Truist Financial Corporation (TFC) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Truist Financial Corporation (TFC)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Truist Financial Corporation (TFC)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.