TRUIST FINANCIAL CORP [TFC-PR] Filings

10-Q 1 tfc-20240630.htm 10-Q tfc-20240630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________________________________________________

FORM 10-Q

_________________________________________________________________

☒ Quarterly Report Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

For the quarterly period ended: June 30, 2024

Commission File Number: 1-10853

TRUIST FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

_________________________________________________________________


North Carolina		56-0939887
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

214 North Tryon Street
Charlotte,	North Carolina	28202
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code:		(336)	733-2000

_________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, $5 par value

TFC

New York Stock Exchange

Depositary Shares each representing 1/4,000th interest in a share of Series I Perpetual Preferred Stock

TFC.PI

New York Stock Exchange

5.853% Fixed-to-Floating Rate Normal Preferred Purchase Securities each representing 1/100th interest in a share of Series J Perpetual Preferred Stock

TFC.PJ

New York Stock Exchange

Depositary Shares each representing 1/1,000th interest in a share of Series O Non-Cumulative Perpetual Preferred Stock

TFC.PO

New York Stock Exchange

Depositary Shares each representing 1/1,000th interest in a share of Series R Non-Cumulative Perpetual Preferred Stock

TFC.PR

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

At July 31, 2024, 1,339,143,439 shares of the registrant’s common stock, $5 par value, were outstanding.

TABLE OF CONTENTS

TRUIST FINANCIAL CORPORATION

FORM 10-Q

June 30, 2024

Page No.

PART I - Financial Information

Glossary of Defined Terms

Forward-Looking Statements and Other Terms

Item 1.

Financial Statements

Consolidated Balance Sheets (Unaudited)

Consolidated Statements of Income (Unaudited)

Consolidated Statements of Comprehensive Income (Unaudited)

Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)

Consolidated Statements of Cash Flows (Unaudited)

Notes to Consolidated Financial Statements (Unaudited)

Note 1. Basis of Presentation

Note 2. Discontinued Operations

Note 3. Securities Financing Activities

Note 4. Investment Securities

Note 5. Loans and ACL

Note 6. Goodwill and Other Intangible Assets

Note 7. Loan Servicing

Note 8. Other Assets and Liabilities

Note 9. Borrowings

Note 10. Shareholders’ Equity

Note 11. AOCI

Note 12. Income Taxes

Note 13. Benefit Plans

Note 14. Commitments and Contingencies

Note 15. Fair Value Disclosures

Note 16. Derivative Financial Instruments

Note 17. Computation of EPS

Note 18. Operating Segments

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Regulatory and Supervisory Considerations

Executive Overview

Analysis of Results of Operations

Analysis of Financial Condition

Risk Management

Liquidity

Capital

Critical Accounting Policies

Item 3.

Quantitative and Qualitative Disclosures About Market Risk (see Market Risk in MD&A)

Item 4.

Controls and Procedures

PART II - Other Information

Item 1.

Legal Proceedings

Item 1A.

Risk Factors

Item 2.

Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities

Item 3.

Defaults Upon Senior Securities - (none)

Item 4.

Mine Safety Disclosures - (not applicable)

Item 5.

Other Information

Item 6.

Exhibits

Glossary of Defined Terms

The following terms may be used throughout this report, including the consolidated financial statements and related notes.


Term			Definition
ACL			Allowance for credit losses
AD and CL			Acquisition and development and commercial land
AFS			Available-for-sale
Agency MBS			Mortgage-backed securities issued by a U.S. government agency or GSE
ALCO			Asset and Liability Committee
ALLL			Allowance for loan and lease losses

AOCI			Accumulated other comprehensive income (loss)



BCBS			Basel Committee on Banking Supervision
BHC			Bank holding company
BHCA			Bank Holding Company Act of 1956, as amended
Board			Truist’s Board of Directors

BRC			Board Risk Committee

C&CB			Corporate and Commercial Banking, an operating segment prior to the Company’s realignment as of January 1, 2024
CB&W			Consumer Banking and Wealth, an operating segment prior to the Company’s realignment as of January 1, 2024
CCAR			Comprehensive Capital Analysis and Review

CD			Certificate of deposit
CDI			Core deposit intangible
CECL			Current expected credit loss model
CEO			Chief Executive Officer
CET1			Common equity tier 1
CFO			Chief Financial Officer

CFTC			Commodity Futures Trading Commission

CIO			Chief Information Officer


Company			Truist Financial Corporation and its subsidiaries (interchangeable with “Truist” below)

CP			Construction and permanent

CRE			Commercial real estate

CSBB			Consumer and Small Business Banking, an operating segment after the Company’s realignment as of January 1, 2024


DIF			Deposit Insurance Fund administered by the FDIC




EPS			Earnings per common share



Exchange Act			Securities Exchange Act of 1934, as amended
EVE			Economic value of equity
FASB			Financial Accounting Standards Board
FDIC			Federal Deposit Insurance Corporation


FHLB			Federal Home Loan Bank
FHLMC			Federal Home Loan Mortgage Corporation

FNMA			Federal National Mortgage Association
FRB			Board of Governors of the Federal Reserve System
FTE			Full-time equivalent employee
GAAP			Accounting principles generally accepted in the United States of America
GCO			Governance and Controls Organization
GDP			Gross Domestic Product


GSE			U.S. government-sponsored enterprise

HFI			Held for investment
HQLA			High-quality liquid assets
HTM			Held-to-maturity

IH			Insurance Holdings, a discontinued operating segment following the announcement of the sale of TIH
IPV			Independent price verification

IRR			Interest rate risk


LCR			Liquidity Coverage Ratio
LHFS			Loans held for sale


LOCOM			Lower of cost or market
Market Risk Rule			Market risk capital requirements issued jointly by the OCC, U.S. Treasury, FRB, and FDIC
MBS			Mortgage-backed securities
MD&A			Management’s Discussion and Analysis of Financial Condition and Results of Operations


MRO			Model Risk Oversight
MSR			Mortgage servicing right

NA			Not applicable


NII			Net interest income
NIM			Net interest margin, computed on a TE basis
NM			Not meaningful
NPA			Nonperforming asset
NPL			Nonperforming loan
NSFR			Net stable funding ratio
NYSE			New York Stock Exchange
OAS			Option adjusted spread
OCC			Office of the Comptroller of the Currency
OCI			Other comprehensive income (loss)

Truist Financial Corporation 1


Term			Definition
OPEB			Other post-employment benefit
OREO			Other real estate owned
OT&C			Other, Treasury and Corporate

Parent Company			Truist Financial Corporation, the parent company of Truist Bank and other subsidiaries

PCD			Purchased credit deteriorated loans


ROU assets			Right-of-use assets

RSU			Restricted stock unit
RUFC			Reserve for unfunded lending commitments
S&P			Standard & Poor’s

SBIC			Small Business Investment Company
SCB			Stress Capital Buffer
SEC			Securities and Exchange Commission




TBVPS			Tangible book value per common share

TE			Taxable-equivalent
TIH			Truist Insurance Holdings, LLC, an entity sold on May 6, 2024
TRS			Total Return Swap
Truist			Truist Financial Corporation and its subsidiaries (interchangeable with the “Company” above)
Truist Bank			Truist Bank, a North Carolina-charted member bank
U.S.			United States of America
U.S. DOJ			United States Department of Justice
U.S. Treasury			United States Department of the Treasury
UPB			Unpaid principal balance


VaR			Value-at-risk
VIE			Variable interest entity
WB			Wholesale Banking, an operating segment after the Company’s realignment as of January 1, 2024

2 Truist Financial Corporation

Forward-Looking Statements and Other Terms

From time to time we have made, and in the future will make, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as “believe,” “expect,” “anticipate,” “intend,” “pursue,” “seek,” “continue,” “estimate,” “project,” “outlook,” “forecast,” “potential,” “target,” “objective,” “trend,” “plan,” “goal,” “initiative,” “priorities,” or other words of comparable meaning or future-tense or conditional verbs such as “may,” “will,” “should,” “would,” or “could.” Forward-looking statements convey our expectations, intentions, or forecasts about future events, circumstances, or results.

This report, including any information incorporated by reference in this report, contains forward-looking statements. We also may make forward-looking statements in other documents that are filed or furnished with the SEC. In addition, we may make forward-looking statements orally or in writing to investors, analysts, members of the media, and others. All forward-looking statements, by their nature, are subject to assumptions, risks, and uncertainties, which may change over time and many of which are beyond our control. You should not rely on any forward-looking statement as a prediction or guarantee about the future. Actual future objectives, strategies, plans, prospects, performance, conditions, and results may differ materially from those set forth in any forward-looking statement. While no list of assumptions, risks, and uncertainties could be complete, some of the factors that may cause actual results or other future events or circumstances to differ from those in forward-looking statements include:

•evolving political, business, economic, and market conditions at local, regional, national, and international levels;

•monetary, fiscal, and trade laws or policies, including as a result of actions by governmental agencies, central banks, or supranational authorities;

•the legal, regulatory, and supervisory environment, including changes in financial-services legislation, regulation, policies, or government officials or other personnel;

•our ability to address heightened scrutiny and expectations from supervisory or other governmental authorities and to timely and credibly remediate related concerns or deficiencies;

•judicial, regulatory, and administrative inquiries, examinations, investigations, proceedings, disputes, or rulings that create uncertainty for or are adverse to us or the financial-services industry;

•the outcomes of judicial, regulatory, and administrative inquiries, examinations, investigations, proceedings, or disputes to which we are or may be subject and our ability to absorb and address any damages or other remedies that are sought or awarded and any collateral consequences;

•evolving accounting standards and policies;

•the adequacy of our corporate governance, risk-management framework, compliance programs, and internal controls over financial reporting, including our ability to control lapses or deficiencies in financial reporting, to make appropriate estimates, or to effectively mitigate or manage operational risk;

•any instability or breakdown in the financial system, including as a result of the actual or perceived soundness of another financial institution or another participant in the financial system;

•disruptions and shifts in investor sentiment or behavior in the securities, capital, or other financial markets, including financial or systemic shocks and volatility or changes in market liquidity, interest or currency rates, or valuations;

•our ability to cost-effectively fund our businesses and operations, including by accessing long- and short-term funding and liquidity and by retaining and growing client deposits;

•changes in any of our credit ratings;

•our ability to manage any unexpected outflows of uninsured deposits and avoid selling investment securities or other assets at an unfavorable time or at a loss;

•negative market perceptions of our investment portfolio or its value;

•adverse publicity or other reputational harm to us, our service providers, or our senior officers;

•business and consumer sentiment, preferences, or behavior, including spending, borrowing, or saving by businesses or households;

•our ability to execute on strategic and operational plans, including simplifying our businesses, achieving cost-savings targets and lowering expense growth, accelerating franchise momentum, and improving our capital position;

•changes in our corporate and business strategies, the composition of our assets, or the way in which we fund those assets;

•our ability to successfully make and integrate acquisitions and to effect divestitures, including the ability to successfully deploy the proceeds from the sale of TIH and perform our obligations under the transition services arrangements supporting TIH in a cost-effective and efficient manner;

•our ability to develop, maintain, and market our products or services or to absorb unanticipated costs or liabilities associated with those products or services;

•our ability to innovate, to anticipate the needs of current or future clients, to successfully compete, to increase or hold market share in changing competitive environments, or to deal with pricing or other competitive pressures;

•our ability to maintain secure and functional financial, accounting, technology, data processing, or other operating systems or infrastructure, including those that safeguard personal and other sensitive information;

•our ability to appropriately underwrite loans that we originate or purchase and to otherwise manage credit risk;

•our ability to satisfactorily and profitably perform loan servicing and similar obligations;

•the credit, liquidity, or other financial condition of our clients, counterparties, service providers, or competitors;

•our ability to effectively deal with economic, business, or market slowdowns or disruptions;

•the efficacy of our methods or models in assessing business strategies or opportunities or in valuing, measuring, estimating, monitoring, or managing positions or risk;

•our ability to keep pace with changes in technology that affect us or our clients, counterparties, service providers, or competitors or to maintain rights or interests in associated intellectual property;

•our ability to attract, hire, and retain key teammates and to engage in adequate succession planning;

•the performance and availability of third-party service providers on whom we rely in delivering products and services to our clients and otherwise in conducting our business and operations;

•our ability to detect, prevent, mitigate, and otherwise manage the risk of fraud or misconduct by internal or external parties; our ability to manage and mitigate physical-security and cybersecurity risks, including denial-of-service attacks, hacking, phishing, social-engineering attacks, malware intrusion, data-corruption attempts, system breaches, identity theft, ransomware attacks, environmental conditions, and intentional acts of destruction;

•natural or other disasters, calamities, and conflicts, including terrorist events, cyber-warfare, and pandemics;

•widespread outages of operational, communication, and other systems;

•our ability to maintain appropriate corporate responsibility practices, oversight, and disclosures;

•policies and other actions of governments to manage and mitigate climate and related environmental risks, and the effects of climate change or the transition to a lower-carbon economy on our business, operations, and reputation; and

•other assumptions, risks, or uncertainties described in the Risk Factors (Item 1A), Management’s Discussion and Analysis of Financial Condition and Results of Operations (Item 7), or the Notes to the Consolidated Financial Statements (Item 8) in our Annual Report on Form 10-K or described in any of the Company’s subsequent quarterly or current reports.

Any forward-looking statement made by us or on our behalf speaks only as of the date that it was made. We do not undertake to update any forward-looking statement to reflect the impact of events, circumstances, or results that arise after the date that the statement was made, except as required by applicable securities laws. You, however, should consult further disclosures (including disclosures of a forward-looking nature) that we may make in any subsequent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, or Current Report on Form 8-K.

Unless the context otherwise requires, “sale of TIH” and similar phrases refer to the sale of our majority stake in TIH on May 6, 2024.

Truist Financial Corporation 3

ITEM 1. FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEETS

TRUIST FINANCIAL CORPORATION AND SUBSIDIARIES



Unaudited (Dollars in millions, except per share data, shares in thousands)	Jun 30, 2024		Dec 31, 2023
Assets
Cash and due from banks	$	5,204	$	5,000
Interest-bearing deposits with banks	35,675		25,230
Securities borrowed or purchased under agreements to resell	2,338		2,378
Trading assets at fair value	5,558		4,332
AFS securities at fair value	55,969		67,366
HTM securities (fair value of $42,143 and $44,630, respectively)	52,447		54,107
LHFS (including $1,284 and $852 at fair value, respectively)	1,457		1,280
Loans and leases (including $14 and $15 at fair value, respectively)	305,692		312,061
ALLL	(4,808)		(4,798)
Loans and leases, net of ALLL	300,884		307,263
Premises and equipment	3,244		3,298
Goodwill	17,157		17,156
CDI and other intangible assets	1,729		1,909
Loan servicing rights at fair value	3,410		3,378
Other assets (including $1,371 and $1,311 at fair value, respectively)	34,781		34,997
Assets of discontinued operations	—		7,655
Total assets	$	519,853	$	535,349
Liabilities
Noninterest-bearing deposits	$	107,310	$	111,624
Interest-bearing deposits (including $43 and $0 at fair value, respectively)	278,101		284,241
Short-term borrowings (including $2,041 and $1,625 at fair value, respectively)	22,816		24,828
Long-term debt	34,616		38,918
Other liabilities (including $2,739 and $2,597 at fair value, respectively)	13,183		12,946
Liabilities of discontinued operations	—		3,539
Total liabilities	456,026		476,096
Shareholders’ Equity
Preferred stock	6,673		6,673
Common stock, $5 par value	6,691		6,669
Additional paid-in capital	36,364		36,177
Retained earnings	22,603		22,088
AOCI, net of deferred income taxes	(8,504)		(12,506)
Noncontrolling interests	—		152
Total shareholders’ equity	63,827		59,253
Total liabilities and shareholders’ equity	$	519,853	$	535,349
Common shares outstanding	1,338,223		1,333,743
Common shares authorized	2,000,000		2,000,000
Preferred shares outstanding	223		223
Preferred shares authorized	5,000		5,000

The accompanying notes are an integral part of these consolidated financial statements.

4 Truist Financial Corporation

CONSOLIDATED STATEMENTS OF INCOME

TRUIST FINANCIAL CORPORATION AND SUBSIDIARIES



Unaudited (Dollars in millions, except per share data, shares in thousands)	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Interest Income
Interest and fees on loans and leases	$	4,879	$	4,915	$	9,744	$	9,571
Interest on securities	838		749		1,643		1,501
Interest on other earning assets	634		511		1,148		887
Total interest income	6,351		6,175		12,535		11,959
Interest Expense
Interest on deposits	2,016		1,527		3,980		2,652
Interest on long-term debt	446		734		928		1,248
Interest on other borrowings	362		311		728		589
Total interest expense	2,824		2,572		5,636		4,489
Net Interest Income	3,527		3,603		6,899		7,470
Provision for credit losses	451		538		951		1,040
Net Interest Income After Provision for Credit Losses	3,076		3,065		5,948		6,430
Noninterest Income
Wealth management income	361		330		717		669
Investment banking and trading income	286		211		609		472
Card and payment related fees	230		236		454		466
Service charges on deposits	232		240		457		490
Mortgage banking income	112		99		209		241
Lending related fees	89		86		185		192
Operating lease income	50		64		109		131

TRUIST FINANCIAL CORP [TFC-PR] Filings
TRUIST FINANCIAL CORP [TFC] Filings
TRUIST FINANCIAL CORP [TFC-PO] Filings
TRUIST FINANCIAL CORP [TFC-PI] Filings
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10-Q	[2023-07-31]
10-Q	[2023-05-01]
10-K	[2023-02-28]
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10-Q	[2022-08-01]
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10-Q	[2020-11-02]
10-Q	[2020-08-04]
10-Q	[2020-05-08]
10-K	[2020-03-03]
10-Q	[2019-10-25]
10-Q	[2019-07-31]
10-Q	[2019-04-30]
10-K	[2019-02-26]
10-Q	[2018-10-26]
10-Q	[2018-07-27]
10-Q	[2018-04-30]
10-K	[2018-02-21]
10-Q	[2017-10-27]
10-Q	[2017-07-28]
10-Q	[2017-04-24]
10-K	[2017-02-21]
10-Q	[2016-10-24]
10-Q	[2016-07-27]
10-Q	[2016-04-29]
10-K	[2016-02-25]
10-Q	[2015-10-30]
10-Q	[2015-07-30]
10-Q	[2015-04-27]
10-K	[2015-02-25]
10-Q	[2014-10-27]
10-Q	[2014-07-28]
10-Q	[2014-04-30]
10-K	[2014-02-26]
10-Q	[2013-10-31]
10-Q	[2013-08-08]
10-Q	[2013-05-02]
10-K	[2013-03-01]
10-Q	[2012-11-02]
10-Q	[2012-08-07]
10-Q	[2012-05-04]
10-K	[2012-02-27]

TRUIST FINANCIAL CORP [TFC-PR] Filings

TRUIST FINANCIAL CORP [TFC] Filings

TRUIST FINANCIAL CORP [TFC-PO] Filings

TRUIST FINANCIAL CORP [TFC-PI] Filings