Fifth Third Bancorp (FITB) Q3 2025 Earnings Call Transcript

Earnings Per Share (EPS) $0.91 or $0.93 (excluding certain items), impacted by nearly $200 million of provision expense associated with fraud at Tricolor. Despite this, the quarter showed excellent operating results across NII, fees, expenses, and strategic growth.

Average Loans Increased 6% year-over-year, marking the fourth consecutive quarter of accelerating year-over-year loan growth.

Average Demand Deposits Up 3% year-over-year, led by 6% consumer DDA growth.

Adjusted Revenues Rose 6%, driven by a 7% improvement in net interest income and 5% growth in fees.

Adjusted Pre-Provision Net Revenue (PPNR) Increased 11%, producing 330 basis points of positive operating leverage.

Adjusted Return on Assets (ROA) 1.25%, reflecting strong profitability despite the impact of fraud.

Adjusted Return on Tangible Common Equity (ROTCE) 17.7%, indicating robust profitability.

Efficiency Ratio 54.1%, showing operational efficiency.

Commercial Nonperforming Assets Declined 14%, with criticized assets decreasing 4%, reaching the lowest level in over 3 years.

Tangible Book Value Per Share Grew 7% year-over-year and 3% sequentially, supported by $300 million in stock repurchases and an 8% increase in the common dividend.

Middle Market Loans Increased 6% year-over-year, with new client acquisition up 40%.

Wealth and Asset Management Fees Climbed 11%, with assets under management reaching $77 billion.

Franchise Finance Transactions 24 transactions totaling $3.9 billion over the past year, including 8 in the third quarter alone.

Commercial Payments Fee Growth Reaccelerated to 3% sequentially in the third quarter.

Newline Revenue Increased 31% year-over-year, with deposits growing by more than $1 billion.

Net Interest Income (NII) Grew 7% year-over-year and 2% sequentially, with net interest margin expanding for the seventh consecutive quarter.

Consumer Loans Grew 2% on an average basis and 1% on a period-end basis from the prior quarter, led by auto and home equity lending.

Core Deposits Increased 1% sequentially, driven by DDA and money market growth.

Adjusted Noninterest Income Grew 7% sequentially and 5% year-over-year, led by wealth, commercial payments, and capital markets.

Wealth Fees Rose 11% year-over-year, supported by $8 billion of AUM growth and strong retail brokerage activity.

Capital Markets Fees Rebounded, up 28% sequentially and 4% year-over-year, driven by higher activity in loan syndications and M&A advisory.

Commercial Payment Fees Increased $5 million or 3% sequentially, driven by core treasury management and Newline-related gross fees.

Net Charge-Off Ratio 109 basis points for the quarter, including $178 million in net charge-offs from Tricolor.

Allowance for Credit Losses (ACL) Decreased 13 basis points to 1.96% of portfolio loans and leases, reflecting improvement in macroeconomic scenarios.

Common Equity Tier 1 (CET1) Ratio Ended at 10.54%, consistent with the near-term target of 10.5%.