Truist's Q4 2024 Earnings: A Mixed Bag of Strengths and Challenges

Truist Financial Corporation (NYSE: TFC) reported its fourth quarter 2024 earnings on Friday, January 17, 2025, with adjusted diluted EPS of $0.91, surpassing analyst expectations of $0.88. Revenue also came in above expectations at $5.11 billion, compared to the anticipated $5.04 billion. Despite these positive results, the quarter presented a mix of strengths and challenges for the sixth-largest U.S. commercial bank.

Truist's taxable-equivalent revenue increased by 3.4% year over year, driven by a 7.9% rise in noninterest income, primarily due to investment banking and trading revenue growth. However, noninterest expenses posed a concern, climbing by 3.7% quarter over quarter and 4.0% on an adjusted basis. This increase was attributed to higher professional fees, outside processing expense, and equipment expense, partially offset by lower personnel expense.

The net interest margin (NIM) decreased by five basis points from the previous quarter, indicating potential pressure due to anticipated rate changes. Truist reported flat average loans and leases held for investment, with consumer loans growing by 1.2% while commercial loans dipped by 0.8%. The CET1 ratio remained strong at 11.5%, but monitoring nonperforming assets remains essential, given concerns about loans 90 days past due.



Truist's CEO, Bill Rogers, expressed optimism for increased profitability in 2025, highlighting cost control and robust capital deployment strategies, including share repurchases planned at $500 million for Q4 2024. Management projected cautious optimism for 2025, focusing on maintaining positive operating leverage and controlling noninterest expenses. They expect adjusted revenue in Q1 2025 to fall 2% while adjusted expenses decrease 3% compared to Q4 2024. For the full year, management expects adjusted revenue growth of 3% to 3.5% and an up-to-1.5% increase in adjusted expenses.

In conclusion, Truist's Q4 2024 earnings call presented a mix of strengths and challenges. While the bank reported positive results in earnings and revenue, it also faced rising noninterest expenses and potential pressure on its net interest margin. As Truist navigates these challenges, investors should monitor the bank's asset quality, capital management, and strategic initiatives to ensure its continued success in the competitive banking landscape.