Fee income growth and resilient balance sheet
leads to another quarter of strong returns
Reported results included a negative $0.07
impact from certain items on page 2 of the earnings release
Fifth Third Bancorp (NASDAQ: FITB):
Key Financial Data
Key Highlights
$ in millions for all balance sheet and
income statement items
3Q24
2Q24
3Q23
Stability:
- Sequential growth in net interest income and net interest
margin driven by the repricing benefit on fixed rate loan portfolio
and moderating deposit costs
- Strong profitability resulted in CET1 increasing to 10.75%
while executing a $200 million share repurchase and raising common
stock dividend by 6%
- Loan-to-core deposit ratio of 71%
Profitability:
- Disciplined expense management; efficiency ratio(a) of 58.2%;
adjusted efficiency ratio(a) of 56.1% improved 70 bps
sequentially
- Interest-bearing liabilities costs down 1 bp from 2Q24
Growth:
- Strong fee performance driven by strategic investments.
Compared to 3Q23:
- Wealth & asset management revenue up 12%
- Commercial payments revenue up 10%
- Capital markets fees up 9%
- Generated consumer household growth of 3% compared to 3Q23
Income Statement Data
Net income available to common
shareholders
$532
$561
$623
Net interest income (U.S. GAAP)
1,421
1,387
1,438
Net interest income (FTE)(a)
1,427
1,393
1,445
Noninterest income
711
695
715
Noninterest expense
1,244
1,221
1,188
Per Share Data
Earnings per share, basic
$0.78
$0.82
$0.91
Earnings per share, diluted
0.78
0.81
0.91
Book value per share
27.60
25.13
21.19
Tangible book value per share(a)
20.20
17.75
13.76
Balance Sheet & Credit
Quality
Average portfolio loans and leases
$116,826
$116,891
$121,630
Average deposits
167,196
167,194
165,644
Accumulated other comprehensive loss
(3,446)
(4,901)
(6,839)
Net charge-off ratio(b)
0.48
%
0.49
%
0.41
%
Nonperforming asset ratio(c)
0.62
0.55
0.51
Financial Ratios
Return on average assets
1.06
%
1.14
%
1.26
%
Return on average common equity
11.7
13.6
16.3
Return on average tangible common
equity(a)
16.3
19.8
24.7
CET1 capital(d)(e)
10.75
10.62
9.80
Net interest margin(a)
2.90
2.88
2.98
Efficiency(a)
58.2
58.5
55.0
Other than the Quarterly Financial Review
tables beginning on page 14 of the earnings release, commentary is
on a fully taxable-equivalent (FTE) basis unless otherwise noted.
Consistent with SEC guidance in Regulation S-K that contemplates
the calculation of tax-exempt income on a taxable-equivalent basis,
net interest income, net interest margin, net interest rate spread,
total revenue and the efficiency ratio are provided on an FTE
basis.
From Tim Spence, Fifth Third Chairman,
CEO and President:
Fifth Third achieved another quarter of strong and consistent
performance driven by our resilient balance sheet, diversified and
growing revenue streams, and disciplined expense management. With
our strong core deposit franchise and liquidity, we are well
positioned for the declining interest rate environment and
volatility driven by the economic and regulatory uncertainty.
Our strategic growth priorities continue to deliver strong
results. In the Southeast, where we are expanding into high-growth
markets, deposits grew by 16% over the last twelve months. We
generated record revenue in our Wealth & Asset Management
business and assets under management grew 21% year-over-year to $69
billion. Our Commercial Payments revenue grew 10% compared to the
year-ago quarter, with Newline adding industry leaders to its
customer base.
Our strong and stable returns on capital allowed us to raise our
common stock dividend by 6%, execute a $200 million share
repurchase, and grow our tangible book value per share, ex. AOCI by
6% in the past year.
We remain well-positioned to generate long-term, sustainable
value to our shareholders as we adhere to our guiding principles of
stability, profitability, and growth – in that order.
Income Statement Highlights
($ in millions, except per share
data)
For the Three Months Ended
% Change
September
June
September
2024
2024
2023
Seq
Yr/Yr
Condensed Statements of Income
Net interest income (NII)(a)
$1,427
$1,393
$1,445
2%
(1)%
Provision for credit losses
160
97
119
65%
34%
Noninterest income
711
695
715
2%
(1)%
Noninterest expense
1,244
1,221
1,188
2%
5%
Income before income taxes(a)
$734
$770
$853
(5)%
(14)%
Taxable equivalent adjustment
$6
$6
$7
—
(14)%
Applicable income tax expense
155
163
186
(5)%
(17)%
Net income
$573
$601
$660
(5)%
(13)%
Dividends on preferred stock
41
40
37
3%
11%
Net income available to common
shareholders
$532
$561
$623
(5)%
(15)%
Earnings per share, diluted
$0.78
$0.81
$0.91
(4)%
(14)%
Fifth Third Bancorp (NASDAQ®: FITB) today reported third quarter
2024 net income of $573 million compared to net income of $601
million in the prior quarter and $660 million in the year-ago
quarter. Net income available to common shareholders in the current
quarter was $532 million, or $0.78 per diluted share, compared to
$561 million, or $0.81 per diluted share, in the prior quarter and
$623 million, or $0.91 per diluted share, in the year-ago
quarter.
Diluted earnings per share impact of
certain item(s) - 3Q24
(after-tax impact(f); $ in millions,
except per share data)
Restructuring severance expense
$(7)
Interchange litigation matters
Valuation of Visa total return swap
(noninterest income)
$(36)
Mastercard litigation (noninterest
expense)
(8)
subtotal
(44)
After-tax impact(f) of certain items
$(51)
Diluted earnings per share impact of
certain item(s)1
$(0.07)
Totals may not foot due to rounding;
1Diluted earnings per share impact reflects 686.109 million average
diluted shares outstanding
Net Interest Income
(FTE; $ in millions)(a)
For the Three Months Ended
% Change
September
June
September
2024
2024
2023
Seq
Yr/Yr
Interest Income
Interest income
$2,675
$2,626
$2,536
2%
5%
Interest expense
1,248
1,233
1,091
1%
14%
Net interest income (NII)
$1,427
$1,393
$1,445
2%
(1)%
NII excluding certain items(a)
$1,427
$1,398
$1,445
2%
(1)%
Average Yield/Rate Analysis
bps Change
Yield on interest-earning assets
5.43%
5.43%
5.23%
—
20
Rate paid on interest-bearing
liabilities
3.38%
3.39%
3.10%
(1)
28
Ratios
Net interest rate spread
2.05%
2.04%
2.13%
1
(8)
Net interest margin (NIM)
2.90%
2.88%
2.98%
2
(8)
NIM excluding certain items(a)
2.90%
2.89%
2.98%
1
(8)
Compared to the prior quarter, NII increased $34 million.
Excluding the $5 million reduction related to the customer
remediations in the prior quarter, NII was up $29 million, or 2%,
primarily reflecting higher loan yields, the benefit of higher day
count, and lower wholesale funding costs, partially offset by lower
average commercial loan balances. Compared to the prior quarter,
NIM increased 2 bps. Excluding the aforementioned customer
remediations in the prior quarter, NIM increased 1 bp, primarily
reflecting higher loan yields from the repricing benefit on the
fixed rate loan portfolio, partially offset by the impact of higher
cash balances. NIM results continue to be impacted by the decision
to carry elevated liquidity given the environment, with the
combination of cash and other short-term investments of
approximately $25 billion at quarter-end.
Compared to the year-ago quarter, NII decreased $18 million, or
1%, reflecting the impact of the RWA diet lowering average loans by
4% and the deposit mix shift from demand to interest-bearing
accounts at higher funding costs, partially offset by higher loan
yields. Compared to the year-ago quarter, NIM decreased 8 bps,
reflecting the net impact of higher market rates and their effects
on deposit pricing and the decision to carry additional cash,
partially offset by higher loan yields.
Noninterest Income
($ in millions)
For the Three Months Ended
% Change
September
June
September
2024
2024
2023
Seq
Yr/Yr
Noninterest Income
Service charges on deposits
$161
$156
$149
3%
8%
Commercial banking revenue
163
144
154
13%
6%
Mortgage banking net revenue
50
50
57
—
(12)%
Wealth and asset management revenue
163
159
145
3%
12%
Card and processing revenue
106
108
104
(2)%
2%
Leasing business revenue
43
38
58
13%
(26)%
Other noninterest income
15
37
55
(59)%
(73)%
Securities gains (losses), net
10
3
(7)
233%
NM
Total noninterest income
$711
$695
$715
2%
(1)%
Reported noninterest income increased $16 million, or 2%, from
the prior quarter, and decreased $4 million, or 1%, from the
year-ago quarter. The reported results reflect the impact of
certain items in the table below, including the mark-to-market on
the valuation of Visa total return swap and securities gains/losses
which incorporate mark-to-market impacts from securities associated
with non-qualified deferred compensation plans that are more than
offset in noninterest expense.
Noninterest Income excluding certain
items
($ in millions)
For the Three Months Ended
September
June
September
% Change
2024
2024
2023
Seq
Yr/Yr
Noninterest Income excluding certain
items
Noninterest income (U.S. GAAP)
$711
$695
$715
Valuation of Visa total return swap
47
23
10
Legal settlements and remediations
—
2
—
Securities (gains) losses, net
(10)
(3)
7
Noninterest income excluding certain
items(a)
$748
$717
$732
4%
2%
Noninterest income excluding certain items increased $31
million, or 4%, compared to the prior quarter, and increased $16
million, or 2%, from the year-ago quarter.
Compared to the prior quarter, service charges on deposits
increased $5 million, or 3%, reflecting an increase in both
consumer deposit fees and commercial payments revenue. Commercial
banking revenue increased $19 million, or 13%, primarily reflecting
increases in corporate bond fees and institutional brokerage
revenue, partially offset by a decrease in client financial risk
management revenue. Wealth and asset management revenue increased
$4 million, or 3%, primarily driven by increases in personal asset
management revenue and brokerage fees. Card and processing revenue
decreased $2 million, or 2%, driven by a decrease in interchange
revenue. Leasing business revenue increased $5 million, or 13%,
primarily driven by an increase in lease remarketing revenue.
Compared to the year-ago quarter, service charges on deposits
increased $12 million, or 8%, primarily reflecting an increase in
commercial payments revenue. Commercial banking revenue increased
$9 million, or 6%, primarily reflecting an increase in corporate
bond fees, partially offset by a decrease in client financial risk
management revenue. Mortgage banking net revenue decreased $7
million, or 12%, primarily reflecting decreases in MSR net
valuation adjustments and mortgage servicing revenue. Wealth and
asset management revenue increased $18 million, or 12%, primarily
reflecting increases in personal asset management revenue and
brokerage fees. Leasing business revenue decreased $15 million, or
26%, primarily reflecting a decrease in operating lease
revenue.
Noninterest Expense
($ in millions)
For the Three Months Ended
% Change
September
June
September
2024
2024
2023
Seq
Yr/Yr
Noninterest Expense
Compensation and benefits
$690
$656
$629
5%
10%
Net occupancy expense
81
83
84
(2)%
(4)%
Technology and communications
121
114
115
6%
5%
Equipment expense
38
38
37
—
3%
Card and processing expense
22
21
21
5%
5%
Leasing business expense
21
22
29
(5)%
(28)%
Marketing expense
26
34
35
(24)%
(26)%
Other noninterest expense
245
253
238
(3)%
3%
Total noninterest expense
$1,244
$1,221
$1,188
2%
5%
Reported noninterest expense increased $23 million, or 2%, from
the prior quarter, and increased $56 million, or 5%, from the
year-ago quarter. The reported results reflect the impact of
certain items in the table below.
Noninterest Expense excluding certain
item(s)
($ in millions)
For the Three Months Ended
% Change
September
June
September
2024
2024
2023
Seq
Yr/Yr
Noninterest Expense excluding certain
item(s)
Noninterest expense (U.S. GAAP)
$1,244
$1,221
$1,188
Mastercard litigation
(10)
—
—
Restructuring severance expense
(9)
—
—
Legal settlements and remediations
—
(11)
—
FDIC special assessment
—
(6)
—
Noninterest expense excluding certain
item(s)(a)
$1,225
$1,204
$1,188
2%
3%
Compared to the prior quarter, noninterest expense excluding
certain items increased $21 million, or 2%, primarily reflecting an
increase in compensation and benefits expense due to higher
performance-based compensation resulting from strong fee revenue,
partially offset by a decrease in marketing expense. Noninterest
expense in the current quarter included a $12 million expense
related to the impact of non-qualified deferred compensation
mark-to-market compared to a $4 million expense in the prior
quarter, both of which were largely offset in net securities gains
through noninterest income.
Compared to the year-ago quarter, noninterest expense excluding
certain items increased $37 million, or 3%, primarily reflecting
increases in compensation and benefits expense as well as
technology and communications expense, partially offset by
decreases in marketing expense and leasing business expense. The
year-ago quarter included a $5 million benefit related to the
impact of non-qualified deferred compensation mark-to-market, which
was largely offset in net securities losses through noninterest
income.
Average Interest-Earning Assets
($ in millions)
For the Three Months Ended
% Change
September
June
September
2024
2024
2023
Seq
Yr/Yr
Average Portfolio Loans and
Leases
Commercial loans and leases:
Commercial and industrial loans
$51,615
$52,357
$57,001
(1)%
(9)%
Commercial mortgage loans
11,488
11,352
11,216
1%
2%
Commercial construction loans
5,981
5,917
5,539
1%
8%
Commercial leases
2,685
2,575
2,616
4%
3%
Total commercial loans and leases
$71,769
$72,201
$76,372
(1)%
(6)%
Consumer loans:
Residential mortgage loans
$17,031
$17,004
$17,400
—
(2)%
Home equity
4,018
3,929
3,897
2%
3%
Indirect secured consumer loans
15,680
15,373
15,787
2%
(1)%
Credit card
1,708
1,728
1,808
(1)%
(6)%
Solar energy installation loans
3,990
3,916
3,245
2%
23%
Other consumer loans
2,630
2,740
3,121
(4)%
(16)%
Total consumer loans
$45,057
$44,690
$45,258
1%
—
Total average portfolio loans and
leases
$116,826
$116,891
$121,630
—
(4)%
Average Loans and Leases Held for
Sale
Commercial loans and leases held for
sale
$16
$33
$17
(52)%
(6)%
Consumer loans held for sale
573
359
619
60%
(7)%
Total average loans and leases held for
sale
$589
$392
$636
50%
(7)%
Total average loans and leases
$117,415
$117,283
$122,266
—
(4)%
Securities (taxable and tax-exempt)
$56,707
$56,607
$56,994
—
(1)%
Other short-term investments
21,714
20,609
12,956
5%
68%
Total average interest-earning assets
$195,836
$194,499
$192,216
1%
2%
Compared to the prior quarter, total average portfolio loans and
leases were stable. Average commercial portfolio loans and leases
decreased 1%, primarily reflecting a decrease in C&I loans,
partially offset by an increase in commercial mortgage loans.
Average consumer portfolio loans increased 1%, primarily reflecting
increases in indirect secured consumer loans, home equity balances,
and solar energy installation loans, partially offset by a decrease
in other consumer loans.
Compared to the year-ago quarter, total average portfolio loans
and leases decreased 4%. Average commercial portfolio loans and
leases decreased 6%, primarily reflecting a decrease in C&I
loans. Average consumer portfolio loans were stable primarily
reflecting decreases in other consumer loans and residential
mortgage loans, offset by increases in solar energy installation
loans and home equity balances.
Average securities (taxable and tax-exempt; amortized cost) of
$57 billion in the current quarter were stable compared to the
prior quarter and decreased 1% compared to the year-ago quarter.
Average other short-term investments (including interest-bearing
cash) of $22 billion in the current quarter increased 5% compared
to the prior quarter and increased 68% compared to the year-ago
quarter.
Period-end commercial portfolio loans and leases of $71 billion
decreased 1% compared to the prior quarter, primarily reflecting a
decrease in C&I loans, partially offset by an increase in
commercial leases. Compared to the year-ago quarter, period-end
commercial portfolio loans and leases decreased 5%, primarily
reflecting a decrease in C&I loans.
Period-end consumer portfolio loans of $46 billion increased 2%
compared to the prior quarter, primarily reflecting an increase in
indirect secured consumer loans. Compared to the year-ago quarter,
period-end consumer portfolio loans increased 1%, reflecting
increases in solar energy installation loans and indirect secured
consumer loans.
Total period-end securities (taxable and tax-exempt; amortized
cost) of $57 billion in the current quarter were stable compared to
the prior quarter and decreased 1% compared to the year-ago
quarter. Period-end other short-term investments of approximately
$22 billion increased 3% compared to the prior quarter, and
increased 15% compared to the year-ago quarter.
Average Deposits
($ in millions)
For the Three Months Ended
% Change
September
June
September
2024
2024
2023
Seq
Yr/Yr
Average Deposits
Demand
$40,020
$40,266
$44,228
(1)%
(10)%
Interest checking
58,441
57,999
53,109
1%
10%
Savings
17,272
17,747
20,511
(3)%
(16)%
Money market
37,257
35,511
32,072
5%
16%
Foreign office(g)
164
157
168
4%
(2)%
Total transaction deposits
$153,154
$151,680
$150,088
1%
2%
CDs $250,000 or less
10,543
10,767
9,630
(2)%
9%
Total core deposits
$163,697
$162,447
$159,718
1%
2%
CDs over $250,000
3,499
4,747
5,926
(26)%
(41)%
Total average deposits
$167,196
$167,194
$165,644
—
1%
CDs over $250,000 includes $2.6BN, $3.8BN,
and $5.2BN of retail brokered certificates of deposit which are
fully covered by FDIC insurance for the three months ended 9/30/24,
6/30/24, and 9/30/23, respectively.
Compared to the prior quarter, total average deposits were
stable, primarily reflecting an increase in money market balances,
offset by a decline in CDs over $250,000. Average demand deposits
represented 24% of total core deposits in the current quarter.
Compared to the prior quarter, average commercial segment deposits
increased 3%, while average consumer and small business banking
segment deposits and average wealth & asset management segment
deposits were stable. Period-end total deposits increased 1%
compared to the prior quarter.
Compared to the year-ago quarter, total average deposits
increased 1%, primarily reflecting increases in interest checking
and money market balances, partially offset by decreases in demand
account balances and savings balances. Period-end total deposits
were stable compared to the year-ago quarter.
The period-end portfolio loan-to-core deposit ratio was 71% in
the current quarter, compared to 72% in the prior quarter and 74%
in the year-ago quarter.
Average Wholesale Funding
($ in millions)
For the Three Months Ended
% Change
September
June
September
2024
2024
2023
Seq
Yr/Yr
Average Wholesale Funding
CDs over $250,000
$3,499
$4,747
$5,926
(26)%
(41)%
Federal funds purchased
176
230
181
(23)%
(3)%
Securities sold under repurchase
agreements
396
373
352
6%
13%
FHLB advances
2,576
3,165
3,726
(19)%
(31)%
Derivative collateral and other secured
borrowings
52
54
48
(4)%
8%
Long-term debt
16,716
15,611
14,056
7%
19%
Total average wholesale funding
$23,415
$24,180
$24,289
(3)%
(4)%
CDs over $250,000 includes $2.6BN, $3.8BN,
and $5.2BN of retail brokered certificates of deposit which are
fully covered by FDIC insurance for the three months ended 9/30/24,
6/30/24, and 9/30/23, respectively.
Compared to the prior quarter, average wholesale funding
decreased 3%, primarily reflecting a decrease in CDs over $250,000,
partially offset by an increase in long-term debt. Compared to the
year-ago quarter, average wholesale funding decreased 4%, primarily
reflecting a decrease in CDs over $250,000 and FHLB advances,
partially offset by an increase in long-term debt.
Credit Quality Summary
($ in millions)
As of and For the Three Months
Ended
September
June
March
December
September
2024
2024
2024
2023
2023
Total nonaccrual portfolio loans and
leases (NPLs)
$686
$606
$708
$649
$570
Repossessed property
11
9
8
10
11
OREO
28
28
27
29
31
Total nonperforming portfolio loans and
leases and OREO (NPAs)
$725
$643
$743
$688
$612
NPL ratio(h)
0.59%
0.52%
0.61%
0.55%
0.47%
NPA ratio(c)
0.62%
0.55%
0.64%
0.59%
0.51%
Portfolio loans and leases 30-89 days past
due (accrual)
$283
$302
$342
$359
$316
Portfolio loans and leases 90 days past
due (accrual)
40
33
35
36
29
30-89 days past due as a % of portfolio
loans and leases
0.24%
0.26%
0.29%
0.31%
0.26%
90 days past due as a % of portfolio loans
and leases
0.03%
0.03%
0.03%
0.03%
0.02%
Allowance for loan and lease losses
(ALLL), beginning
$2,288
$2,318
$2,322
$2,340
$2,327
Total net losses charged-off
(142)
(144)
(110)
(96)
(124)
Provision for loan and lease losses
159
114
106
78
137
ALLL, ending
$2,305
$2,288
$2,318
$2,322
$2,340
Reserve for unfunded commitments,
beginning
$137
$154
$166
$189
$207
Provision for (benefit from) the reserve
for unfunded commitments
1
(17)
(12)
(23)
(18)
Reserve for unfunded commitments,
ending
$138
$137
$154
$166
$189
Total allowance for credit losses
(ACL)
$2,443
$2,425
$2,472
$2,488
$2,529
ACL ratios:
As a % of portfolio loans and leases
2.09%
2.08%
2.12%
2.12%
2.11%
As a % of nonperforming portfolio loans
and leases
356%
400%
349%
383%
443%
As a % of nonperforming portfolio
assets
337%
377%
333%
362%
413%
ALLL as a % of portfolio loans and
leases
1.98%
1.96%
1.99%
1.98%
1.95%
Total losses charged-off
$(183)
$(182)
$(146)
$(133)
$(158)
Total recoveries of losses previously
charged-off
41
38
36
37
34
Total net losses charged-off
$(142)
$(144)
$(110)
$(96)
$(124)
Net charge-off ratio (NCO ratio)(b)
0.48%
0.49%
0.38%
0.32%
0.41%
Commercial NCO ratio
0.40%
0.45%
0.19%
0.13%
0.34%
Consumer NCO ratio
0.62%
0.57%
0.67%
0.64%
0.53%
The provision for credit losses totaled $160 million in the
current quarter. The ACL ratio was 2.09% of total portfolio loans
and leases at quarter end, compared with 2.08% for the prior
quarter end and 2.11% for the year-ago quarter end. In the current
quarter, the ACL was 356% of nonperforming portfolio loans and
leases and 337% of nonperforming portfolio assets.
Net charge-offs were $142 million in the current quarter,
resulting in an NCO ratio of 0.48%. Compared to the prior quarter,
net charge-offs decreased $2 million and the NCO ratio decreased 1
bp. Commercial net charge-offs were $72 million, resulting in a
commercial NCO ratio of 0.40%, which decreased 5 bps compared to
the prior quarter. Consumer net charge-offs were $70 million,
resulting in a consumer NCO ratio of 0.62%, which increased 5 bps
compared to the prior quarter.
Compared to the year-ago quarter, net charge-offs increased $18
million and the NCO ratio increased 7 bps. The commercial NCO ratio
increased 6 bps compared to the prior year, and the consumer NCO
ratio increased 9 bps compared to the prior year.
Nonperforming portfolio loans and leases were $686 million in
the current quarter, with the resulting NPL ratio of 0.59%.
Compared to the prior quarter, NPLs increased $80 million with the
NPL ratio increasing 7 bps. Compared to the year-ago quarter, NPLs
increased $116 million with the NPL ratio increasing 12 bps.
Nonperforming portfolio assets were $725 million in the current
quarter, with the resulting NPA ratio of 0.62%. Compared to the
prior quarter, NPAs increased $82 million with the NPA ratio
increasing 7 bps. Compared to the year-ago quarter, NPAs increased
$113 million with the NPA ratio increasing 11 bps.
Capital Position
As of and For the Three Months
Ended
September
June
March
December
September
2024
2024
2024
2023
2023
Capital Position
Average total Bancorp shareholders' equity
as a % of average assets
9.47%
8.80%
8.78%
8.04%
8.30%
Tangible equity(a)
8.99%
8.91%
8.75%
8.65%
8.46%
Tangible common equity (excluding
AOCI)(a)
8.00%
7.92%
7.77%
7.67%
7.49%
Tangible common equity (including
AOCI)(a)
6.52%
5.80%
5.67%
5.73%
4.51%
Regulatory Capital Ratios(d)(e)
CET1 capital
10.75%
10.62%
10.47%
10.29%
9.80%
Tier 1 risk-based capital
12.07%
11.93%
11.77%
11.59%
11.06%
Total risk-based capital
14.12%
13.95%
13.81%
13.72%
13.13%
Leverage
9.11%
9.07%
8.94%
8.73%
8.85%
CET1 capital ratio of 10.75% increased 13 bps sequentially
driven by strong profitability. During the third quarter of 2024,
Fifth Third repurchased $200 million of its common stock, which
reduced shares outstanding by approximately 4.9 million at quarter
end. Fifth Third increased its quarterly cash dividend on its
common shares by $0.02, or 6%, to $0.37 per share for the third
quarter of 2024.
Tax Rate
The effective tax rate for the quarter was 21.3% consistent with
the prior quarter and slightly lower than 22.0% in the year-ago
quarter.
Conference Call
Fifth Third will host a conference call to discuss these
financial results at 9:00 a.m. (Eastern Time) today. This
conference call will be webcast live and may be accessed through
the Fifth Third Investor Relations website at www.53.com (click on
“About Us” then “Investor Relations”). Those unable to listen to
the live webcast may access a webcast replay through the Fifth
Third Investor Relations website at the same web address, which
will be available for 30 days.
Corporate Profile
Fifth Third is a bank that’s as long on innovation as it is on
history. Since 1858, we’ve been helping individuals, families,
businesses and communities grow through smart financial services
that improve lives. Our list of firsts is extensive, and it’s one
that continues to expand as we explore the intersection of
tech-driven innovation, dedicated people, and focused community
impact. Fifth Third is one of the few U.S.-based banks to have been
named among Ethisphere's World’s Most Ethical Companies® for
several years. With a commitment to taking care of our customers,
employees, communities and shareholders, our goal is not only to be
the nation’s highest performing regional bank, but to be the bank
people most value and trust.
Fifth Third Bank, National Association is a federally chartered
institution. Fifth Third Bancorp is the indirect parent company of
Fifth Third Bank and its common stock is traded on the NASDAQ®
Global Select Market under the symbol “FITB.” Investor information
and press releases can be viewed at www.53.com.
Earnings Release End Notes
(a)
Non-GAAP measure; see discussion of
non-GAAP reconciliation beginning on page 27 of the earnings
release.
(b)
Net losses charged-off as a percent of
average portfolio loans and leases presented on an annualized
basis.
(c)
Nonperforming portfolio assets as a
percent of portfolio loans and leases and OREO.
(d)
Regulatory capital ratios are calculated
pursuant to the five-year transition provision option to phase in
the effects of CECL on regulatory capital after its adoption on
January 1, 2020.
(e)
Current period regulatory capital ratios
are estimated.
(f)
Assumes a 23% tax rate.
(g)
Includes commercial customer Eurodollar
sweep balances for which the Bank pays rates comparable to other
commercial deposit accounts.
(h)
Nonperforming portfolio loans and leases
as a percent of portfolio loans and leases.
FORWARD-LOOKING STATEMENTS
This release contains statements that we believe are
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Rule 175 promulgated
thereunder, and Section 21E of the Securities Exchange Act of 1934,
as amended, and Rule 3b-6 promulgated thereunder. All statements
other than statements of historical fact are forward-looking
statements. These statements relate to our financial condition,
results of operations, plans, objectives, future performance,
capital actions or business. They usually can be identified by the
use of forward-looking language such as “will likely result,”
“may,” “are expected to,” “is anticipated,” “potential,”
“estimate,” “forecast,” “projected,” “intends to,” or may include
other similar words or phrases such as “believes,” “plans,”
“trend,” “objective,” “continue,” “remain,” or similar expressions,
or future or conditional verbs such as “will,” “would,” “should,”
“could,” “might,” “can,” or similar verbs. You should not place
undue reliance on these statements, as they are subject to risks
and uncertainties, including but not limited to the risk factors
set forth in our most recent Annual Report on Form 10-K as updated
by our filings with the U.S. Securities and Exchange Commission
(“SEC”).
There are a number of important factors that could cause future
results to differ materially from historical performance and these
forward-looking statements. Factors that might cause such a
difference include, but are not limited to: (1) deteriorating
credit quality; (2) loan concentration by location or industry of
borrowers or collateral; (3) problems encountered by other
financial institutions; (4) inadequate sources of funding or
liquidity; (5) unfavorable actions of rating agencies; (6)
inability to maintain or grow deposits; (7) limitations on the
ability to receive dividends from subsidiaries; (8) cyber-security
risks; (9) Fifth Third’s ability to secure confidential information
and deliver products and services through the use of computer
systems and telecommunications networks; (10) failures by
third-party service providers; (11) inability to manage strategic
initiatives and/or organizational changes; (12) inability to
implement technology system enhancements; (13) failure of internal
controls and other risk management programs; (14) losses related to
fraud, theft, misappropriation or violence; (15) inability to
attract and retain skilled personnel; (16) adverse impacts of
government regulation; (17) governmental or regulatory changes or
other actions; (18) failures to meet applicable capital
requirements; (19) regulatory objections to Fifth Third’s capital
plan; (20) regulation of Fifth Third’s derivatives activities; (21)
deposit insurance premiums; (22) assessments for the orderly
liquidation fund; (23) weakness in the national or local economies;
(24) global political and economic uncertainty or negative actions;
(25) changes in interest rates and the effects of inflation; (26)
changes and trends in capital markets; (27) fluctuation of Fifth
Third’s stock price; (28) volatility in mortgage banking revenue;
(29) litigation, investigations, and enforcement proceedings by
governmental authorities; (30) breaches of contractual covenants,
representations and warranties; (31) competition and changes in the
financial services industry; (32) potential impacts of the adoption
of real-time payment networks; (33) changing retail distribution
strategies, customer preferences and behavior; (34) difficulties in
identifying, acquiring or integrating suitable strategic
partnerships, investments or acquisitions; (35) potential dilution
from future acquisitions; (36) loss of income and/or difficulties
encountered in the sale and separation of businesses, investments
or other assets; (37) results of investments or acquired entities;
(38) changes in accounting standards or interpretation or declines
in the value of Fifth Third’s goodwill or other intangible assets;
(39) inaccuracies or other failures from the use of models; (40)
effects of critical accounting policies and judgments or the use of
inaccurate estimates; (41) weather-related events, other natural
disasters, or health emergencies (including pandemics); (42) the
impact of reputational risk created by these or other developments
on such matters as business generation and retention, funding and
liquidity; (43) changes in law or requirements imposed by Fifth
Third’s regulators impacting our capital actions, including
dividend payments and stock repurchases; and (44) Fifth Third's
ability to meet its environmental and/or social targets, goals and
commitments.
You should refer to our periodic and current reports filed with
the Securities and Exchange Commission, or “SEC,” for further
information on other factors, which could cause actual results to
be significantly different from those expressed or implied by these
forward-looking statements. Moreover, you should treat these
statements as speaking only as of the date they are made and based
only on information then actually known to us. We expressly
disclaim any obligation or undertaking to release publicly any
updates or revisions to any forward-looking statements contained
herein to reflect any change in our expectations or any changes in
events, conditions or circumstances on which any such statement is
based, except as may be required by law, and we claim the
protection of the safe harbor for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995.
The information contained herein is intended to be reviewed in its
totality, and any stipulations, conditions or provisos that apply
to a given piece of information in one part of this press release
should be read as applying mutatis mutandis to every other instance
of such information appearing herein.
Category: Earnings
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241018104103/en/
Investor contact: Matt Curoe (513) 534-2345 Media contact:
Jennifer Hendricks Sullivan (614) 744-7693
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