Truist takes a $1.4 billion securities loss; Citizens earns more

What happened

After PNC, U.S. Bancorp and Schwab earned more on Thursday 15 October, Truist reported on Friday 16 October that its third-quarter profit fell to $0.80 billion from $1.45 billion. ^{[1, 7]}

Citizens Financial Group earned $636 million, against $494 million a year earlier. M&T Bank earned $775 million, against $792 million. Both filed their releases with the SEC the same day. ^{[2, 3]}

Why it matters

Most of Truist's drop came from selling assets, the release shows. It booked a $1.4 billion loss selling securities to reposition its portfolio, and a $66 million loss on selling its Regional Acceptance auto loans, the release says. Its noninterest income, its fees and other income, fell to $84 million from $1,558 million. ^{[1, 4, 5]}

Truist resets its balance sheet

Net interest income, what a bank earns on loans and securities less what it pays for funds, was $3.66 billion, against $3.63 billion. Total revenue was $3.75 billion, against $5.19 billion. ^[1]

Truist reported a $253 million benefit for credit losses, a release of reserves, against a $436 million provision a year earlier. It released $581 million of reserves held against the sold auto loans. Net charge-offs, loans written off less recoveries, were $629 million, of which $251 million came on moving those loans to held for sale. ^[1]

On Wednesday 14 October it agreed to sell $7.7 billion of LightStream personal loans to Carlyle, the release says. Chief executive Mike Lyons said the bank is 'simplifying the company and focusing our resources, capital, and expenses on the businesses and capabilities' that serve its clients. ^{[1, 4]}

Citizens and M&T

Citizens' net interest income grew 13 percent to $1,675 million and total revenue was $2,322 million, against $2,118 million. Its provision for credit losses was $125 million, against $154 million, and net charge-offs were $137 million, against $162 million. ^[2]

M&T's net interest income was $1,793 million, against $1,761 million, and its noninterest income $743 million, against $752 million. Its provision was $135 million, against $125 million, and net charge-offs $127 million, against $146 million. ^[3]

What settles it next

Truist's finance chief Mike Maguire said on its call that the bank expects fourth-quarter net interest income of $3.65 billion to $3.7 billion. He said the LightStream sale is expected to close in the fourth quarter. Citizens' chief executive Bruce Van Saun said in the release: 'We remain confident in our positioning and outlook for Q4 and for 2027.' ^{[5, 2]}

Each bank files its quarterly report on Form 10-Q next. SEC rules give large accelerated filers 40 days after a quarter ends: Monday 9 November, by the desk's count. ^[6]

Who it reaches

Truist (TFC), Citizens Financial Group (CFG) and M&T Bank (MTB) are direct: the figures are each company's own, from its release filed with the SEC on Friday 16 October. ^{[1, 2, 3]}