Truist Financial (TFC) Q3 2026 Earnings Call: Portfolio Sales and ROTCE Targets
Source Tradingkey
Key Takeaways
- Truist Financial Corporation (NYSE: TFC) reported Q3 2026 net income available to common shareholders of $684 million, or $0.56 per diluted share. Excluding the RAC sale and related AFS securities repositioning, adjusted EPS was $1.16, up 12% year over year.
- Adjusted ROTCE reached 14.6%, improving 100 basis points from Q3 2025. Management reaffirmed its ROTCE targets of 15% in 2027 and 16% to 18% over the long term.
- Average deposits increased 1.4% sequentially and 3.6% year over year, while average loans declined 1.1% to $326 billion as Truist exited or reduced noncore and lower-return lending.
- Truist completed the sale of its $5.5 billion RAC auto loan portfolio and agreed to sell $7.7 billion of LightStream loans. The LightStream transaction is expected to close in Q4 2026 and generate approximately $850 million, or 20 basis points, of CET1 capital.
- For Q4 2026, management expects approximately $5.35 billion of revenue, net interest income of $3.65 billion to $3.70 billion, a 2.5% sequential increase in reported noninterest expense and net charge-offs of 45 basis points.
- The company is reallocating capital and expenses toward branches, ATMs, technology, digital banking, payments, credit cards, treasury management and client-facing talent. A fuller strategic and financial outlook is planned for early 2027.
Key Financial Data
| Metric | Q3 2026 result | Change or context |
|---|---|---|
| Net income available to common shareholders | $684 million | GAAP result |
| Diluted EPS | $0.56 | Strategic actions reduced reported EPS by a net $0.60 |
| Adjusted EPS | $1.16 | Up 12% year over year |
| Adjusted ROTCE | 14.6% | Up 100 basis points year over year |
| Average loans held for investment | $326 billion | Down $3.6 billion, or 1.1%, sequentially |
| Average deposits | — | Up 1.4% sequentially and 3.6% year over year |
| Taxable-equivalent net interest income | $3.7 billion | Up $40 million, or 1.1%, sequentially |
| Net interest margin | 3.00% | Up 2 basis points sequentially |
| Adjusted noninterest income | $1.6 billion | Down 2.9% sequentially; up 2.5% year over year |
| Noninterest expense | $3.1 billion | Up 1.6% sequentially; adjusted expense rose 0.3% |
| Reported net charge-offs | $629 million, or 77 bps | Included $317 million of RAC loan losses |
| Adjusted net charge-offs | $312 million, or 38 bps | Excludes RAC loan losses |
| CET1 ratio | 10.7% | Down 20 basis points sequentially |
| Capital returned to shareholders | $1.8 billion | $632 million of dividends and $1.2 billion of buybacks |
Business and Operating Performance
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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