Truist Financial (TFC) 20 Apr 232023 Q1 Earnings call transcript

Greetings, ladies and gentlemen, and welcome to the Truist Financial Corporation's First Quarter Call. Currently, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation.

As a reminder, this event is being recorded.

It is now my pleasure to introduce your host, Mr. Investor Financial of Head Vyas, Relations, Corporation. Truist Ankur

and morning, to With Truist's you, Bill today Allay, quarter Welcome good and Rogers; CEO, and call. Thank first Maguire. everyone. XXXX our Chairman CFO, our Mike are us earnings

they conditions During business outlook first quarter on recent for -- updated events, and XXXX. discuss results, this will Truist's their share morning's perspectives outlook call, and current provide an

Chief Holdings' Clarke John Risk and Vice Starnes, the and Officer; Chair; in Insurance and Chair Investor our the Q&A also available Howard, website, Cummins, are call. portion Truist are on of well Truist Relations as supplemental earnings to Chairman as presentation in Beau CEO release Vice information and financial our ir.truist.com. available our attendance accompanying our The participate are

will appendix appropriate today and Slides on financial statements and well statements the and measures presentation these forward-looking GAAP. X review Please include regarding for certain as measures. reconciliations the presentation to non-GAAP disclosures X the of Our as

With over that, to Bill. the now I'll call turn

good you morning, know for our you joining everybody, of thank and I and day a call. you. busy have Ankur, ahead Thanks,

of clients I of stakeholders, historic who was first even really an The unusual and and of banking our purpose to one strength into position am leaned commitment care our proud industry. our and reassuring for to XXXX an extremely more for possibly than our serve teammates maybe them. quarter certainly of XX,XXX Truist's continue and them

successfully highs our granular uncertain strength Based volatile satisfaction relationship-oriented the improved in and branches demonstrated share, production deposit integrating operating by to to which resiliency mix, and Throughout market Truist's scale organic March to on of send and the and it after from capital liquidity. environment, X. quarter, client weeks business diverse the base strong increasing the as and and we benefits new a we has of shift experience from our continue and evidenced scores

continue some of where to our offset and share that on funding to somewhat discuss, some higher marketplace time, will and we activities in growth. as take costs focus the by have we was optimize positive and also Mike But to momentum improve actions certain Strategically, resources simplify, an expenses. at of same profitable our or the franchise consolidate in those details exit will areas the some call. later we advantage elevated

is We'll results quarter's on with at easy be provide to and And begin topical can which the short-term lead powerful our on presentation. it grow over important more of at the and Slides purpose lives inspire purpose why most and a throughout reminder in on the the But to long-term, focus first, it's purpose items the expense other are deliver times, the X Truist. effective we way that always better to and X. These let's build is slides details communities. on to our certain that long-term the with

a other But comments gauge this today, on and to will interest investor topic little topics. my briefer be

with our Our Inspire. the in while what closely teammates exactly witnessed words purpose that's statement I with working March. intentionally And begins

needs. move Truist's mentioned, inspired questions their as to purpose the teammates how I held them system As they about help into with our banking discussions forward stakeholders answer their clients I strength by to leaned was and position with and numerous emphasize and and care financial financial

many purpose we on our Slide client month, there were actualized throughout to we ways provided we other the X. highlight quarter, which addition In care last

week. efforts of many Report, about our better we You and which in can and these read other items communities lives Responsibility build last our XXXX to more Corporate published

rate Quarter performance that quarter run unadjusted last mostly MOE-related spend exited walk results highlights through performance on focused X. (ph) I'll given or our Slide slide on year. Now first our GAAP

results and of significant GAAP no the on expense Going MOE adjusted adjusted to of forward, impact since efficiency due and tangible the scale remained exceptions focus PPNR has we the amortization to primarily on with intangible intend generation. capital

Truist by Relative a net merger X% more up of decreased lower year strong due reported provision adjusted quarter cost, quarter due in PPNR, the to interest quarter lower billion $X.X share, XX%, XXXX, partially seasonality. growth compared a income a like first or net $X.XX level to fourth and income offset primarily normal EPS to to ago. of

income fee capital offset by X% activity higher decreased was PPNR markets more higher prior net better guidance than than consistent expected lower interest sequentially, with as Adjusted due and expenses. our somewhat expected than to income

XXXX, of points first we XXX good and quarter year. start a reflecting delivered XX%, adjusted Relative the operating to adjusted leverage, PPNR basis grew the positive of to

continue quality remains prudently basis strong uncertain expectations. consistent our X ALLL normalize reflect net a to to built charge-offs We more environment. points our and with Asset economic ratio

and were despite more loans, trends cover liquidity the sheet in the usual, Balance business we'll and expected fairly all capital more about in noise later mid-March and presentation. deposits, as

and our update to on technology moving X. digital Slide So

and fully-own for early Continued in critical be building Truist digital the in primacy clients the good digital merger, digital the in due end-to-end. close allows investments the of progress in The engagement, which news to the deposits. and relationships between Truist is even relationship digital will more experience us cloud, our experience prioritized to organically digital

our money Zelle, strong we continued first opened and quarter, first of In digitally, deposit importance investments transactions We and payments quarter in expectations. reflect capabilities in our growth to agility exceeding particular, underscoring our accounts and digital the saw the internal movement Our results clients. XXX,XXX momentum. a

strategy capability engine, which opening and a launched to broadly, had we the rates paid. clients for driven In account technology us during incredibly more targeted allow be respect quarter space, deposit data to deposit More to we pricing our new advance provides productive based personalized relationship an with rate will even set. we as reimagine our

of eventually documents. track loans, our digital the dashboard, signed clients capabilities status their that We documents of lending launch commercial the loan and solution an enhanced with wholesale our also lending industry-leading upload allows to electronically

clients view, with eventually experience to digital our one and for and to incorporate markets into our Our Truist. creating dashboard experience integrated end-state seamless payments, desired relationship goal corporate a across and capital lending commercial this is

turning to Slide lower we've balances while on where solid growth sequentially pulled balances portfolios in a and more Average was grew targeted intentionally loans X.X% increased portfolios leases XX loan points. end-of-period So X. for back. and growth basis modest Loan

return on reduce growth intentional slower increasing and to last while an basis in decision and indirect portfolios, mortgage spreads of rates strategic ongoing was certain our also including The end-of-period in from second and auto year reflects and production. half the correspondent production lower expected

to across CIB an benefits X% as X.X% growth production. reflecting our and December and on lower decreased Consumer X.X% basis basis student reflecting capabilities and points the on partnership well down from balances CCB, runoff increased ongoing balances basis indirect C&I average on auto due and lending were our of average XX XX, in markets. an and as end-of-period continued loan

service Truist returns ways our relationships loan impactful greater We're Strategically, in velocity on clients have allows sheet This increase to single finance. as of limiting usage we're be us and who sheet indirect securitization. our while also balance businesses our clients. balance such more sales of increase utilization to focusing balance more increasing and the and evaluating broader product with sheet,

generally the and Next, events XX. decreased I'll deposit to starting on inflation consistent during our mid-March, X.X%, provide tightening, alternatives. Despite driven average deposit Slide balance rate of Average some perspective with unique overall trends quantitative quarter by the trends deposit expectations. on movements were first higher

yesterday. from market money month outflows since bags. primarily deposits. higher business in related been to the some during funds These CIG across usual in to more clients. We CCB Within and the flows March cases, period mutual tended as be were to March, Positive in concentrated of a chose and and outflows of through non-operational diversify including to deposit cost multiple XX the were XX March mid-March have largely

We performance. continues proposition value openings with our new quarter, first improved production, new operating we're One. the year-over-year also Truist deposit net experienced from uplift new relationships account integrating leading to to to including deposit due driving our Retail XX% expanding the branch both existing shift of and retention as in saw improve production and Truist with clients. inflows client clients account strong with In record attracting

momentum deposit account weeks seen to of growth money to Commercial those clients beginning are had More in good move couple fund first March, as accounts. the record Community April new in Banking of and was we've of XX% the to overall pace from previously previously. decreased anticipated. deposits mix deposits non-interest-bearing than as of happened noteworthy flows DDA a the This shift than XX% we from sooner little

paid. so due to Interest-bearing deposit contributing the Deposit the basis XX beta interest-bearing relative in a sequentially, XX% far presence of cycle. rate the needs betas maximizing cumulative to quarter into increased and of non-interest-bearing the fourth costs interest-bearing accelerated mentioned the deposit high to previously points alternatives rate to be products. from attentive shift while relationships client outside DDA value We'll of continue to and

Truist provided and most additional investor closer thanks one our base a look Slide in factors. we higher at Given XX. franchises key of deposit to robust has industry, deposit the banking interest three the details, deposit on

has ranks XX markets. Tampa, like or Mid-Atlantic. in making First, XX currently deposit in of D.C., cities the first, U.S. Charlotte, second in Atlanta, us market of the the Raleigh-Durham, among Top Truist in Southeast shares the Truist in others, Miami, fastest-growing markets strong Those player share many third dominant the and include

group important Truist in granular and/or source stability. retail insured an highest that collateralized, second XX% which of deposit base is Second, leading the has a peer is our and

across XX with diversified industry than representing no XX% and one groups addition, more commercial commercial In deposits our deposits. banking of are sector corporate

Truist you the time table have slide. services. The products these at account bottom we're for during of include and oriented, has broadened average years to see which can as highly XX deposit been open relationship multiple the from the Third, at relationships

business deposits average over small of account an balances have insured. of million XX balance with XX,XXX. granular highly are deposit and retail RSBB In we XX% accounts are and banking,

primary addition, preponderance bank the those Truist is In the clients. of for

the these business, source products. payments Commercial investments depositors for relationship with management clients. the Truist our to with XX% or In factors a a and related that and are with Wealth depositors strength lending of Bank operating advisory Truist, have majority have Community of Together, for treasury our Wealth of XX% our Truist

to me over our in it to Mike results So discuss turn more now detail. financial let

you, net Thank good income on interest and with I'll Bill, begin everyone. XX. morning, Slide

higher quarter, in For growth. than the X.X% fewer quarter funding costs loan sequentially and equivalent solid of days interest decreased as offset effects the two taxable the net more income

DDA into March. points, margin, and was basis weeks basis decrease to decision net the during from points our products X X while a mix few other the basis of shift to last core points net liquidity interest When core X funding net interest in margin deposit by was points. basis down the the low decreased driven margin you more about in decreased conservatively carry X due cost and break approximately interest-bearing deposits Reported interest

the to X.X%. seasonal compared fee Moving exceeded income quarter organic revenue on light fourth Fee income seasonality. income was stable increased of to due XX. to headwinds. in largely was million, growth typical expectations and Slide Insurance modestly relatively Year-over-year our $XX

Mortgage income the by gain million, mortgage quarter. due which relatively to sale a activity on MSR from $XX to stable of compared rose offset a Income valuation was adjustments. partially primarily servicing was core banking portfolio, prior

Wealth for Wealth as continues to brokerage million, eight to the asset management and the approximately market income flows, and were impact the $XX due an during asset changes, been from rising have $X asset build quarters. increase for fees value of billion momentum commissions, organic in quarter. last benefiting higher net seven prices which improved quarter exclude of flows positive the

trading in and bond loan fixed derivatives we banking were strength by yield and grade modest by high syndications. led In increase pleased addition, originations, income, investment investment income the and in

IRM, CIB's relationship aided fees integrated increased hiring markets were from strategic factors, be sequentially up first non-CIB from capital management increased years activity. past over performance idiosyncratic well as continues XX% With two two quarter to XXXX. by respect as and XX% to clients the

decreased primarily Other non-qualified lower million, our to income plan. income from $XX due

in remains continues as income below areas our banking investments to continue such of While our IRM normalize markets momentum as investment will insurance, fee and key mature. execution a its wealth source to be as potential, and

X% activities to in the The non-interest a were decrease million Reported adjusted amortization in million $XX of offset non-interest merger driven integration in a expense. costs $XXX million now expense. XX. reductions a $XX million by largely and completion I expense Slide due reduction by Turning expense to or just increase declined described $XXX

in million drivers due $XX regulatory a Expense and million included pension in charges expense premiums. FDIC higher increase a $XX to increase

fraud Insurance with $XX experienced Truist which are operating other losses, million in We recognized to issues due transaction a operating in loss industry also prior check Stone reflected expense then Point. increase completing and to our within

at actions certain and a realignment are As trading expense fixed by number services business platform. market-making activities generating company, Truist. and a bend undertaken which strategic within of in arc markets sales and a the to income we fixed middle expense discontinued Last provided our week, we that income announced committed reductions our help have we

for expense of save and impact platform for focused and produced realignment ROE. largely being sales had on will bank MBS-related to $XX approximate This This an unattractive run our an rate a in depositories more premier result was investment with strategy and us focus trading corporates, and enable sponsors core little PPNR fulsome issuers. million on municipal and

and supporting experience existing We're also in the reduce Truist's of and base. LightStream and digital our process capabilities, innovation, and broader with of goal platforms our of primacy This consumer the client clients. the efficiencies broader with separate a cloud-based our prospective cost enhance of and realigning the bringing LightStream with brand strategy infrastructure business the to will

capacity adjust own on drove and strategic in actions, mortgage and In charges addition, are continue These current restructuring market we our client focus of million focus among what during to the to reflect $XX conditions quarter. our the others, primacy. challenging

month also we've which expectations, shared Truist compensation about of a aligned ago. Furthermore, executive with I to shareholder many you to

will as believe well we're for returns our actions curve and expense focus, we these bend together, our improve other increase Taken Truist. as taking

XX. Moving to Slide

XXXX. Loans basis quarter strong remained past prudent were XX quality the points loan points remain diverse portfolio. reflecting indicators first risk Asset sequentially XX and due in favorable. down quarter, the XX Leading decreased days basis versus XX to our and of first culture

increased charge-offs points XX basis to XX Our to consistent relatively are primarily the NPL C&I in benign Net normalization at a levels. points. continued basis and points, consumer X ratio pre-pandemic due and basis was steady with

of our to by we prudently points We basis our economic our light became even ratio increased regarding outlook increased more ALLL cautious fundamentals. and in in increased by uncertainty, $XXX CRE allowance And X.XX%. X million

clients. reducing credit approach in for anticipation environment, and tightening we increasing while of risk risk our high-quality, an areas In are appetite selected also long-term through-the-cycle our maintaining

dive given XX. Next, Slide high I on investor will into CRE deeper interest,

we combined As of the establish to evaluated ensure diversification we risk forward. were Truist, we understood about we outcome, we including our various the began this portfolios, become fully retaining them to integration profile the how achieve to going process their intentional very merger. To would carefully manage CRE benefits and

on deemphasize not we CRE wholly until go-to-market we did a While process, single did pause it production strategy. this during aligned we

CRE end X.X% end decision, the the Truist XXXX, of peer a XXXX portfolio As by CRE our result of of median to this whereas actually decreased XX%. from grew

in peer disciplined concentration our Our focus CRE and to less on diversification relative has also group. resulted risk

our disciplined performance with At We year-end, maintain through we selection. sponsors work prudent XX% comprised our the peer. a and segment X.X% typically office mix risk portfolio loan loan at CRE of at book and of management compared high-quality know our and to XX% observed and peer developers their the cycle. CRE X.X% median well versus client median have We represented our through

strong portfolio with reduced also exposure results. CRE. The our annual is sponsorship, quality CRE to Federal smaller in large of be and to Reserve's tends test the stress CRE our exposure institutional have reflected Our we

metrics, remain Our in is CRE disciplined approach our to quality reflected which asset solid.

years. you averse right, area our selective can lower the risk XX had has billion outstanding over the see balances where portfolio, past snapshot as two $X office a In which and been another in of approximately and March highly Truist of

we tends than properties believe large to Class portfolio footprint, A markets. office will Our within urban be better towards our weighted which perform

we have the our a with laddered great the of our maturity will past any Criticized very few manageable to in ahead conservative reserves increased months, clients the be over team profile LTVs, portfolio. problems. given overall have problems is and CRE We proactive but believe get that of trends working

and Turning to XX. liquidity Slide capital on

from basis was CECL Our CETX generation increased of approximately by partially as to ratio XX offset X.X% XX of X% points points phase-in. organic capital basis

not ratio, While by December CETX in XX March AOCI billion to our from XX. included $X improved

OCI by to to and We $X.X portfolio, Of portion rate in billion March of billion approximately billion securities decrease billion the XX, the and by static the is is of our $XX.X by would $X.X related of to portfolio, our pension to billion XXXX that's frozen $X AFS XX%, related environment. plan. is billion end the portfolio $X.X after-tax or to expect as OCI, our $X.X related related HTM of a

minority our sale a of and be X%. we tangible provides addition, basis powerful points in the X, on XX% In a Truist with April this book this driver accretion Holdings, increasing in future. time, On Insurance of ratios higher will of per to share value also which which closed over tangible approximately the value capital flexibility we added stake small XX book quarter glimpse saw a past

declared we share, a March which $X.XX was dividend strong X. Additionally, of per on common paid

significant liquidity internal as that of includes to liquidity Finally, testing well Truist managed as very robust a position. continues monitoring access external have stress and process to and liquidity real-time our

LCR consolidated improved remains XXX% average well minimum and the the above XXX%. quarter regulatory of Our during to first

capacity, to have FHLB discount billion unpledged securities We capacity. $XXX including approximately of borrowing liquidity, and access window cash,

agency government $X securities $X.X portfolio, reminder, billion cash billion of and which of XX% about a produces As our flow to per obligations represent quarter.

end During quarter, position activity from increased callable largely conservatively to as expect to by going $XX that $XX December has stabilized. forward FHLB our would advances the at billion March, of given we that and somewhat XX of funded normalize billion the cash

we're in and we for size, position broadly, and phase-in our high do strong we potential institution that likely period expect requirements to a but heighten, of already liquidity respond a More would company believe to flexibility orderly expectations regulatory have changes. as strategic the the the around in capital given an financial accompany

Slide on guidance updated Now I will XX. review our

by XXXX, stable modest X% to are expenses anticipated linked in as revenues the result as compared be decline offset Adjusted revenue growth. quarter first increase incentive-based second from stronger the quarter to X% insurance to into a relatively NII compensation of Looking revenue. is expect higher a primarily seasonally we to insurance quarter of

now year outlook income to and full we revenues compared funding outlook by driven given to to XXXX, expenses expect X%. net XXXX. increase a almost entirely are Adjusted expected X% our between the deposit interest to For is previous increase X% still The decline X% from and costs. lower higher

costs. indicated on actions focused remain reduce year taking I to As earlier, the throughout we

Excluded two items. from our adjusted outlook expense are

clarity, the or are we we receive potential not provide we'll on surcharge update assessment. including First, of incremental an After estimated impact any impact. FDIC

there to Holdings to XXXX occurring independent, in operating Secondly, capital more its directly Insurance transition one-time to consistent tied significant preparing costs structure. is time. value be XXXX expenses its over in the These to realizing Truist which some and new will model be business with correlate

We expenses results, provide for not in will we our will adjust these but transparency.

produce still The two given growth degree leverage these full positive the year, funding Our has excluding operating of and goal is difficulty relative to for positive to items. increased adjusted January costs. higher PPNR

net ratio between the to year be basis unchanged. the for Our points full expectations is charge-off XX for

discrete will we the expect excluding contra line and effective taxable approximately no and accounting amortization to a regarding revenue items, new Lastly, approximately change equivalent This XX%, line. to our guidance on to recent basis other XX% of which the of adoption our be expense bottom tax now translates the due on tax shifts has impact rate income credits. tax simply market

to hand it I'll Bill remarks. back for some final Now

Great. Mike. Thanks,

our as potential So optimistic investment in about the conclude thesis. right on Slide realize is And to highly significant XX, path. ability summarized to our post-integration I'm Truist on our

profitability growth so produce to strong Our do and peers. goal with to our volatility financially than less and is

our made began strengths. the an we integrating where on our and to strategic have decision also resources areas are advantage focus we As to synergistic core a ago, quarters several from most with shift marketplace to operating in we

relationship solutions less Since commercial, net primary are relevant in and to are that with experiences clients on our deposit our businesses worth distinctive that investment into our most households that and and opportunities. high corporate and reducing to respect we time, consumer product returns focus relevant and while clients strategically

with industry realizing banking already here. We of shift. the go changes early to We're are this consistent where benefits believe is these the from likely

our the deposit we've clients, For account as checking becoming quality. improve continued production new new best instance, core One well among Truist seen products, and first since of focus Truist, flight on the to quarter was driven net retention including by consumer as attractiveness

accelerated production first has account we've a increased as rooms. that the care checking I journey the by steady Trust and has The quarter. earlier, satisfaction since been XX% Branch our in improvements distinct to One, seen client year driven has and client procedures up well to our said agents the as service compared improvement of digital ago our branch provide in XX% launch and in as processes in originated

of the I'm really proud earlier, to is indicated few quarter. this to higher teammates teammates our during I the and in provided care last care As in voice reflected March, clients weeks -- of scores our our of client

in program Lastly, and we last XX%. targets grown our to we growth strong remain most expense sheet strategic of relationship At advance same of partnerships, these critical I revenues quarter the tougher the continue will to partnerships Relative for details year, stakeholders. the IRM balance which establishing our our is December. integrated by environment long-term shared management management acknowledge by for time, strategic that and have first

credit of risk-adjusted increased, dynamic (ph) to because mix, profile conservative closing, position range position. our uncertainty culture, of diverse markets, outcomes interest while a a profitability management, and approach strong rate in strong balanced In our strength across Truist is broad capital business of has risk

and I to truly on of and experiences the communities. than talented optimistic better and distinctive our inspire XX,XXX our build purpose am teammates deliver create about our client Truist more as to momentum lives future build on

me So to Q&A. turn with let back it you over that, for Ankur,

I'd like of time, that as accommodate as today. Great. session? we yourselves at primary our one you the and question to participate participants do ask you possible listeners Bill. Allay, follow-up to one the to can to this explain you will Q&A Thank limit in many they As can that, how you, so

Ken And Jefferies. question Usdin you. Of we'll course, ahead. and first Instructions] go [Operator from go with thank ahead our Please take

Thanks. Good morning.

you gave relationships. in the good just on start wanted Just terms deposit color the of front, to

end-of-period in some and You was that down was X%, of the seasonal. deck mentioned that

kind us a here? bit if give if and for So saw and outlook of the and just Thanks. what deposits you just you deposits wondering color quarter on just how flow of the see stabilization you seen little more mix from end can you've

first-two which Hey. the Actually, think relatively We We typical. stable saw Mike. seasonal impact public Good about you saw flows. of course quarter, It's evolve Ken. saw related the if morning, we've sort months where tightening, funds. really quarter, throughout the throughout of right. the of That's the the saw our balances seen throughout of qualitative very outflows some expected to We previous quarters. couple of we

And so. X% so down about we're probably or

clients X% And opening of then our in and We Bill for into the our extent. public behavior. of month wealth mentioned rate saw during that little into market a of some We cycle outflows. quarter, the in money week last down accounts say the that about really the cycling remarks. happened saw bulk pursuant to saw quarter. investment higher We bit I'd accounts the higher we money continued a saw people ended of [indiscernible] fund

probably far it's first on quarter of to and deposits, outlook the as continue quarter And in expectation, put X%. two-thirds impacts that week concerned, really X% tune the As since some driving to of steady first in pressure March. the our that the first pressure that been the business usual frankly, were is is and to fourth will as

think -- I XX% to do cycling think given all that? what's about said first expect mix there's XX% -- What previously that time. to more you view how that down as of what happened? thought Okay. just you of you had in over approach the you mix? what my you you're that could at that changed quarter. do And And Has just total follow-up is DDAs then about

We're Bill. it's were -- Ken, we pre-COVID, at XX%. of Yeah. sort

mentioned, that you right We're migrate high-XXs. XX% down clearly now. we're As to going to

of the know sort rates is of sort as now. where upon I right level upon what depending think stabilization are, based that And we

just that to to the add said production, of retail expect well to on just side deposit as engine continue the to what I continue. just and positive focus And Mike

that really So in might be have good so production while sort flattish of we core on we down X a franchise. percent, our momentum to down or positive balance, includes

you. Thank Understood.

Yeah.

Please Morgan to our ahead. We'll Graseck move with Betsy on Stanley. go from next question

This line Hi. is Netter Good for Blake morning. on Betsy. the

morning. Good

wondering, potential how of debt – How in should the your about I'm be how impact? potential LCR we about think plans expected and tougher and to talk thinking issuance you impact (ph) about [indiscernible] near future. and could you're TLAC if could -- other the requirements announced

Sure. we've some I'd previously perspective, regular probably say versions we've perspective, quarters phase-in We've But way really much ultimately will studied in that the from on period country Truist of the applied be size. framework. sort the TLAC the is banks certainly, a issuance, considering allow our has, reasonable of this a comply for abundance certainly of that framework, our to TLAC, the our caution, the a traditionally eyes case. had companies something industry that the entire number same framework from is effort. given that our largest We've that tailored of assessed were perhaps And in without the have applied. will

in your you January. issuance, And $X so around raised we billion we question to -- saw debt

that Truist we that relatively given perspective what's get that and think But whether positioned I applied that comply it's to with company Truist. net funding at to expectation may better the is issue that to that's it a a opco. prepared TLAC and influence extent eligible and feel really the of or we extent we'll issuer. regular we well Our the to needs TLAC the be a not the sense perspective, and for holding is how eligible scale from And

overdrafts about me. deposits came talk down charges Got Can you [indiscernible] a Service the question more it. get on this even just one bit to quarter. here? used And you from for separately, potential sequentially for

new big the no going is One, but we accounts. of Yeah. part get our to deposit continue client sort lower instituted acquisition, and also of Truist They're a generation fee our like, to it's which overdraft

be. So to on and those thought everything basically will are about. that of continue in And they’d And to talked our all those where path they’re we right draft lower. guidance we

you. Thank

next We'll Please Evercore take Pancari go question our ahead. with ISI. from John

Good morning.

morning. Hi. Good

the On just for X% your I on that expectation? back expectation, balances growth on that full confirm year, to X%. the Thanks. to to want the and debt Is deposit -- end-of-period

view. impact for work of to the first this not and just sure getting If about that quarterly that's sense And of we've just quarter prior easing and we may sort linear a That's Yeah. share its and in the of tightening I'm impact some progression. of share was that going the our to done certainly how of tightening. think the qualitative a our be

is basis, to reflective in or as products alternative, the rate alternative that that is and but view. reflective where or And to X% we're it's quarterly on an higher environment that's investment are people continue a of products QT also frankly, quarterly bank a perhaps so assess X% of, continuing rates

Okay. And dynamics. there. interest of margin then us deposit Thank about you. on can to project a get also, cycle XX%. what Thanks. progression at deposit is want I fair also net you see you're from know currently here? your I And through beta. thoughts you then separately, the Got margin this the do it, Can And playing terms how maybe to out you Mike. and in talk expect

down that the in were mentioned about reported prepared and margin interest drivers. points, two Sure. X first Maybe basis, our and we on we had in a remarks, -- net basis our just primary really quarter,

sort was also to caution. made decision we sheet. we was, in more of a on That liquidity we of have little bit the that first do the balance The something abundance the mentioned that

a relative the really very And NII on the that minimis de to it while because of balance did an the sort have impact there's sheet swell there, funding cost of bit. doesn't size negative carry so

also bulk the then of There's rest. shift, point the net the interest basis So drove funding about also just decline. And impact PAA. had overall of we X X margin the mix there in which denominator probably for drove points basis

Those little it same maybe factors the down Perhaps -- in behaviors, that quarterize well. first of exist will also extent, of you some quarter terms as some more and impacts. to quarter drove in our but have second a to basis bit those X the in points to NIM modest, the be

points in the call has another, And second downside expectation it, so basis quarter. is probably that our of dozen NIM

going on that second NIM. just we've position, approached whether we -- I depend have mix outlook example, that, really DDA The as of not talked that sensitivity we've more credit mentioned see these but spreads the far factors. more betas, the for probably other about an of the side, some There's factor a two. it's beyond on kind As or sort a Bill the half, is neutral think before intentionally as stable rate to of a widen

is been exceeding little expectations in we're That just The as first at and performed today beta our worse we IBD now, data you mentioned around expected, that than basis assumption have where XX% our a we've NIM, XX%. NII a our quarter the on today. until we we spot

expect low-XXs terminal have of XX%. that a to and migrate full outlook quarter, the to we We the for second

Got it. Thanks, Mike.

question comes from ahead. Wells Fargo Securities. Our next Please go Mike Mayo with

put you what, I Hi. know be don't diesel I’m should quite analogy keep just corvette it pushing good. XXX closed the not so mistake branches you faster, corvette good. the looks in the or by that first but efficiency as if so in the but here, you quarter, like fuel fuel isn't are

merger other getting You're benefits.

the integration growth. revenue to decent, X% growth, completed X% but to phase is X% You've expense you for also and guide X% which

operating said know and that's you FDIC are but positive the X% you lending cautious are you management leverage. this I expenses. positive time hey, expenses pension, this peers, team for to getting isn't And higher And need some say, leverage, go expense both we we're some the I of which and then to and revenues you your your tighten spend. but true some to back minimum X% when of as for at of get looking And on more wage, indicated. have operating

more from a bit of give efficiency little the to color about transition Thanks. Truist you as integration just So growth.

Right. Mike, of And at spare corvette from I'm it. right to to sort analogies just going is try go the

positive Mike we're to really I to mean, going -- The focus continue guidance guidance As leverage. NII said, really an we're issue. on revenue operating is

second the other that, things some half year, might And even all Our still comprise if markets very of continued the the that investment hopefully, we're in of. confident focus insurance, really improve banking, have upside. on

your it, so, categories you expense the about. mean, of But call talked that sort we exactly embedded right. is X% side point I in the have or on

those leader the a in that particularly other manage that has leverage they based to and do. me, plans business have that ability the readjusting on component an plan, positive component those of every trust plans that. So to And can are they NII operating their and things

things in quarter, this table. already past, saw more would that the LightStream. reflective consolidation about of been the off You are things realignment income, have fixed have of that doing you of we're these might sort the that been I the strategy of mean talked

and everything a that on digitization, table on in firmly work to spans more a us all like as automation, We'll all the this focus things we it focus with the of relates do real they're into keen year area, and positive on Now the with leverage. else move mortgage for operating expenses. the table as is eye rest and the clear layers, firmly estate,

if that question. it's you're then And Truist. national branding with And rebrand more Mid-Atlantic of mean to separate strategy. interesting, Okay. you plan to And does so, Southeast, Do one to in LightStream have Truist? going the you're a

with You the region go different brands. outside the

trying I'm reconcile your just names. to brand So

Yeah. Really same actually. of sort around way

we So for Truist. that as different eventually that. We created the of the today down don't wind completely increase LightStream it brand -- Truist to to reasons relates we're side really LightStream going and really exist

got we've market, incredible really digital good So franchise, this incredible capabilities.

with Promoter fast say, digital Net the And let's Truist really to Scores all all times, client those now incredible what we're doing is turnaround bring base. capabilities, LightStream

national then will also and emphasis Truist be rather So sort partnerships on with brands. that the of are the Truist base client than this clients

we what So pleased did. with I'm

things. brand, supporting the made incredible And really a we're capability. did Truist with also are things comment has But this We it. of the separate having brand. other we and a marketing associated I the a expense There's success I with cool think we that that. and with lot all created earlier, to of right lot

an standpoint it think bring and create have. from a accelerate then to I under relationships that incredible revenue cementing umbrella, these standpoint efficiencies expense want some from we more deposit So and penetrating we further and

you. Thank right. All

Thanks.

will Our America. from now… come Bank next line is of go with ahead. your Please Poonawala question And Ebrahim

on Ebrahim, mute. are you

next maybe Allay, to the person. just we shift

will Erika Please Najarian come go question with from next our UBS. And ahead.

Good Hi. morning.

morning. Good

that – morning. good mentioned you You

point you and and growing in to is how priority? capital generation. capital from tighter liquidity the And standards. now some Do your would do and build starting standards. perhaps dividend of up like to should feel RWA mitigation buybacks XX is Bill, as speed anticipating there closer higher order you organic think if could that You're we here, about anticipate liquidity your X.X plans X.X. capital suspect you lowest you And think growth? is And your about XX be so, I also, that that points capital basis for as

at the Yeah, X.X Insurance completed Remember, Erika. we're Truist today, and actually we've interest Thanks. Holdings. as

So start we're capital mean mode mode until in the now with comfortable where level But is. build a right I I our we're we in there, not. we're if mean, now, we're capital right

comes be So post to of XX the of dividend. landscape, we sort or into so accretion points play. want understand that That's understand the really organic prepared. regulatory landscape, got our We've basis capital

continue continue will support be to to and dividend dividend. Our us, to we'll our important

of to build We'll little got -- right capital. in continue a the So good a place we're at now capital bit I think be mode. we've with

several the that X.X in financial come sort see sort things that and I with of have. strategic and up most here of on just way. we'll number respond the anything We'll the then think to to our where see. And we've flexibility that sort of blow line we might quarters. you And got capital mentioned So regulatory combined we'll organic through opportunities

supporting You focus to continue be though, going did mention on growth. our is to organic

but to reduce RWA, We're going don't to need maximize RWA. we

create insurance need then on We more particularly want mentioned, repurchase just RWA now. it. being RWA, is velocity things as advantages. do around you to which that's to in sustainable our important we a don't from talked create we window. just not to then our I and And right Dividend that not capital optimize about. share change and But So short-term M&A like standpoint. do capabilities want mean then I focus to

on And sorry taking But optimization list is franchise. are that specials franchise it's the has in conversation your XX% portfolio this second like this terms car FX that And based and where car seems keep make is, like more Got valuation puts the over feels it is clear are that holding steps you accelerating it. a what's takes because aside, on you to Bill, I the laundry the it coming ROTCE right. question the than pretty in the to that was been and this some everything you that analogy, of quarter (ph) of wonder, up. with my the rather do like have AFS your brewing now of Corvette another a optimization Mike's of an

it's about when there's you're but perhaps is, every think very operating here comes better everything it mean, think there. how and wonder continuous always optimization. of leverage a that this to what there's sake weighing 'XX adjustments of I and Because do I I the cleaner this to is expenses. And franchise the to 'XX pulling numbers for always sort forward for clean year and that positive potential it clear the of But improvement look, company, And right? just up process

visibility guys you for? likely that that feel investors curve so your aiming And that on see are like I bend to less expense are

Yeah.

me up if break understood try I into that two to question. Let components, the

core the our So through. is around you of as question sort you edges. mean, about those some optimizing a There an are seeing seeing bit are shift, is and of a dramatic talked so of but that, more acceleration it's powerful. and of in That's thinking we're that business little speed those, today. there. things Because I a around And the a all franchise parts you're our not around I up strategic know, the little those bit

that at And we company are what that we franchise. resources expanding the want incredible this that have do make to sure towards growing, devoted is

that could with little talked of examples capital were So small really are probably markets I about, the maybe think, good And about a argue accelerated we those. you they things accelerating. a A of LightStream, and

value. not just you're there's benefit answer to we really securities this at the to of side, a long-term good we If not do for portfolio, on that, mean time. I the balance going to going to and the protectors is that sheet are want economic be shareholder anything

think Erika? [indiscernible], dramatically Did change to us to would were so something stay change we'll course And I unless there that the that our posture. cause

just of wondering that that a of some they follow-up, your of cleaner your you if it initiatives I sort optimized I'm terms on tell curve Yeah. quarters and your -- as and just is investors in accelerated expense 'XX expenses wondering, really so see can could GAAP that you really the if if was have for power? goal seems EPS

Yeah.

relative cleaner But and think And continue I think think that But are they’re long-term And beneficial, we we’re to along be the going that path. we will be have opportunities yes, cleaner quarter, to I ‘XX, would I get statement cleaner not that they process we going of I a stay to – when every think on basic think flight that to getting miss those. that, every goal. have quarter in path. quarter yes. of your they’re the part first we’ll

you. Thank Perfect.

Cassidy Please next with Our question go Gerard from come RBC. ahead. will

Good Bill. morning, Good Mike. morning,

morning. Good

to Mike, and maybe this is Clarke on directed credit. more

in my prepared that again, by you up obviously. something you X with the charge-offs, which remarks was You went low, guys But credit you cited perked points. interesting they're that me. interest quality, basis very to C&I, said But strong had

course, you your was So risk reducing about but question selected the CRE, up you appetite pointed is, built the of allowance, talked you're in also and that areas. then for out

are one? where number areas, those So

-- if portfolio included leverage maybe comments then guys is well. in I C&I, loan could you what C&I as also the your what in elaborate that And happened there assume in about

Hey, Great. Gerard.

Hey, with start Clarke. Why there. [indiscernible] you don't

as what lending we first that what we approach is have far want maintain foremost, and say clients. I'd for always focused through-the-cycle to So our as are our we as on, areas

how not be to going we sense. or more make lend. cautious want where it our just we're to appetite shifts in prudent We and So dramatic makes

and higher on right focused we're areas due more the diligence the of So less things you would ones be like expect, now leverage. would some exceptions,

finance CRE, leverage lower-end market given senior of So aspects things Gerard. like like things consumer, care would be that, one, the

it's think consistent there but around clients. being I for our more cautious, So being

right well other question, And is very to our performing your book now. leverage

is investment is remind would be just total would on I you loans. that Portfolio you XX% So all the of about grade. X.X% our focused portion

modest very have We levels. hold

down come last have book. over now, very well. And multiples leverage years it's performing the right in of couple that Our

have NPLs We at X.X%.

at NCOs Our are X.XX%.

performance. So good overall very

episodic of C&I the we nothing range. And in we as We're such XXXX, normalized toward then coming and QX, basis levels. go more there's just low up off a If we range, couple losses far point back a into in extremely there. as were were just

So specific nothing there.

comfortable following conditions then good. the or market Clarke. pick market challenging how business, larger of with from kind know Very as over out up, some up? the conditions it's we some And to strategic out competitors, with hires Are or it guys Mike, really the last Thank you, talked revenues expense from pick built your there. your you you revenue the the want banking do to two to in you really about you've up area need see investment now banking And of investment years.

will It I'll to start it there something perform a for the Bill expectations investment may the type we remain In business to but years. sort bright And add. that performing recently first and that banking maybe Yeah. that Pipelines us. continue really have was of is lot of well. quarter, to talent well. by adding been But that the have we've just franchise that over driven think solid. high fact a caliber not I is the consistently platform, spot

There's interruptions, harder. I it. transaction doubt are And market no about deal mean, so markets, there's a markets look, little

space, sort deals of a we our really on we've middle clients for and like middle the get market to sponsor got side. franchise, we feel done where the powerful upper continue in But corporate and market

in we're correlated about been highly And always investment so revenues supportive will that optimistic case. that's and we're business. carefully managing and the it still but very the expenses be And banking look, with business,

about And long question, margin some you the and investment has of franchise. comments part I of earlier over time. that good questions saw of margin been business a it this business the back a discipline the Yeah. having always And to were your a and had of for of us, think lot sustainability, banking period to quarter is strength

this equity, take advantage So revenue afford franchise to across base and debt earn opportunity us client all incredible grade, being high this and able up. of really being

just base. revenue it So us more that in for and more creates confidence consistency

Great. Thank insights you the gentlemen. for

one time for Allay, we've more question. got

take go we'll with question John last McDonald our And Autonomous Research. ahead. Please from

Hi. has could for Good M&A your you looks increased then you? add that comments know from And transaction running about the optionality get for and the we I utilizing we're gotten could if thoughts morning. Thanks. year. environment you the what operating insurance on about John environment a like tight. this the Maybe also

John. Do Hey, to… want you

us. firm, Thank capacity year. it we'll for is our do the I if for you are to expect the much in And by This to to Howard. about organic environment are Pricing experiencing. very growth growth you catastrophe both continues an There think be course inflationary insurance. continues rates, improve But and to favorable. John. values that the think at we're about affected they you insurance of headwinds, insured continue Sure, are from environment Those some standpoint, property. tailwinds the insured see When good organic look John over I particularly net-net, question. around exposed the be

to market response about question transaction the very acquisitions, the your to Stone has Point And positive. been

business we've clients, candidates. So acquisition gotten partners from as as companies, teammates, insurance great feedback well

well So very we're I positioned. think

Great. Thanks.

Thanks, John.

earnings call. Okay. our completes That

will Thank We a great busy now reach free have but out disconnect in your the Allay, you questions, you for day. we day, know you Relations If feel you to to team. can have call. any additional the have please a hope you Investor interest Truist. guys

conclude your And for you today's with Thank participation. that, that call. does

now You may disconnect.