Truist Financial Corporation
TFC · NYSE
Next quarter
Reports Oct 16, 2026.
Consensus is $1.11 EPS for Sep 2026 across 7 estimates, ranging $1.08 to $1.16.
TFC Jun 2026
- 13.89%
- -2.86%
- $1.08
- $1.23
- —
- —
Reported results
- $1.55B
- $1.23
Highlights
- Earnings beat: Diluted EPS was $1.23 versus the $1.08 consensus, a 13.89% surprise; net income of $1.55 billion rose 4.9% from Q1 and 25.2% from Q2 2025.
- Broad operating improvement: Revenue increased to $5.27 billion from $5.15 billion in Q1 and $4.99 billion a year ago, while pre-provision net revenue rose 1.9% sequentially and 10.1% year over year to $2.26 billion.
- Credit costs eased: Provision for credit losses declined to $395 million from $479 million in Q1 and $488 million a year ago; annualized net charge-offs fell to 0.50% of average loans from 0.61% in Q1.
- Fee income strengthened: Noninterest income reached $1.64 billion, up from $1.55 billion in Q1 and $1.40 billion a year ago, led by year-over-year growth in investment banking and trading income to $352 million from $205 million.
- Net interest income was resilient: Net interest income increased to $3.62 billion from $3.60 billion in Q1 and $3.59 billion a year ago, despite taxable-equivalent NIM narrowing to 2.98% from 3.02% and 3.02%, respectively.
- Consumer banking led segments: Consumer and Small Business Banking net income rose to $835 million from $730 million in Q1 and $574 million a year ago, while Wholesale Banking net income increased sequentially to $960 million but remained below $1.08 billion a year ago.
- Balance sheet expanded: Period-end loans rose to $332.3 billion from $331.4 billion at March 31, deposits reached $409.4 billion from $404.1 billion, and average loans and deposits increased to $331.7 billion and $404.9 billion, respectively.
- Credit quality remained a watchpoint: Nonperforming loans and leases increased to 0.51% of loans from 0.50% in Q1 and 0.39% a year ago, driven in part by indirect auto nonaccruals of $569 million versus $455 million in Q1.
- Capital and returns improved sequentially: Preliminary CET1 rose to 10.9% from 10.8%, while return on average tangible common equity increased to 15.4% from 13.8% in Q1 and 12.3% a year ago.
Analysis
Truist delivered a solid second quarter, with diluted EPS of $1.23 beating the $1.08 consensus by 13.89%. Net income reached $1.55 billion, up from $1.48 billion in Q1 and $1.24 billion in Q2 2025, while EPS increased from $1.09 and $0.90, respectively. The result combined modest balance-sheet and net interest income growth with stronger fee income and lower credit costs. Net interest income rose 0.6% sequentially and 0.9% year over year to $3.62 billion, although taxable-equivalent NIM slipped to 2.98% from 3.02% in both comparison periods.
The main earnings lift came from operating leverage and credit. Noninterest income increased 5.9% sequentially and 17.4% year over year to $1.64 billion, supported by investment banking and trading, wealth management, and card and treasury management fees. Provision expense fell 17.5% from Q1 and 19.1% from a year ago to $395 million, and net charge-offs declined to 0.50% of average loans. Consumer and Small Business Banking was the strongest segment, with net income up 14.4% sequentially and 45.5% year over year. However, nonperforming loans rose to 0.51% of loans, primarily reflecting continued pressure in indirect auto, while Wholesale Banking earnings remained below the prior-year level.
Earnings and operating leverage
Truist’s earnings improvement was broad rather than dependent on a single unusual item. Revenue rose to $5.27 billion from $5.15 billion in Q1 and $4.99 billion a year ago, while noninterest expense increased more slowly than revenue and reached $3.06 billion. The efficiency ratio was broadly stable at 58.0%, versus 57.9% in Q1 and 59.9% a year ago.
- Pre-provision earnings: PPNR was $2.26 billion, up from $2.21 billion sequentially and $2.05 billion year over year.
- Returns: ROA improved to 1.13% from 1.10% in Q1 and 0.93% a year ago; ROTCE rose to 15.4% from 13.8% and 12.3%.
- Expense mix: Personnel expense increased to $1.79 billion from $1.73 billion in Q1 and $1.68 billion a year ago, while professional fees declined year over year to $335 million from $373 million.
Net interest income
Net interest income was essentially stable despite continued margin pressure. Average earning assets increased to $492.5 billion from $486.4 billion in Q1, and average loans and leases grew to $331.7 billion from $329.0 billion. Deposit growth also supported the balance sheet, but the benefit was partly offset by lower asset yields as rates declined.
- Margin: Taxable-equivalent NIM was 2.98%, down from 3.02% in Q1 and 3.02% a year ago.
- Funding costs: The rate on total interest-bearing deposits was 2.10%, little changed from 2.09% in Q1 but below 2.52% a year ago.
- Growth: Period-end loans increased 0.3% sequentially to $332.3 billion, while deposits rose 1.3% to $409.4 billion.
Fee income and segments
The fee businesses provided an important counterweight to slower spread income. Noninterest income rose to $1.64 billion, with year-over-year gains in investment banking and trading, wealth management, mortgage banking, and lending-related fees. Investment banking and trading income of $352 million was down from $372 million in Q1 but well above $205 million a year ago.
- Consumer and Small Business Banking: Net income was $835 million, up from $730 million in Q1 and $574 million a year ago. Segment net interest income rose to $2.60 billion from $2.49 billion sequentially, while allocated provision declined to $307 million from $374 million.
- Wholesale Banking: Net income increased to $960 million from $891 million in Q1 but fell from $1.08 billion a year ago. Noninterest income was $1.16 billion, up sequentially from $1.07 billion and above $941 million a year ago.
- Mortgage banking: Income was $116 million, below $133 million in Q1 but above $107 million a year ago; residential originations increased to $6.82 billion from $5.14 billion sequentially.
Credit quality and provisions
The quarterly credit-cost benefit was meaningful, but asset quality was mixed. Provision for credit losses fell to $395 million, and net charge-offs declined to $414 million from $491 million in Q1. The allowance for credit losses also declined modestly to $5.32 billion from $5.34 billion, leaving coverage at 1.51% of loans and 2.9 times nonperforming loans.
- Nonperforming loans: Nonaccrual loans and leases held for investment rose to $1.69 billion from $1.64 billion in Q1 and $1.25 billion a year ago.
- Indirect auto: Nonaccruals increased to $569 million from $455 million in Q1 and $247 million a year ago; the quarterly net charge-off rate was 1.73%.
- Commercial credit: Commercial and industrial nonaccruals declined to $657 million from $738 million in Q1, while CRE nonaccruals increased to $43 million from $21 million.
Capital and balance sheet
Truist expanded deposits and loans while maintaining capital above the prior quarter. Period-end assets grew to $556.0 billion from $549.0 billion at March 31, and the decline in shares outstanding supported per-share book value growth even as common equity declined modestly.
- Capital: Preliminary CET1 was 10.9%, up from 10.8% in Q1; the total risk-based capital ratio increased to 14.0% from 13.7%.
- Book value: Common equity per share rose to $48.04 from $47.60, while tangible common equity per share increased to $33.40 from $33.19.
- Share count and dividend: End-of-period shares fell to 1.22 billion from 1.25 billion in Q1; the quarterly dividend remained $0.52 per share.
