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Truist Financial (NYSE:TFC) stock slipped 2.3% in Thursday premarket trading after the regional bank cut its full-year guidance as net interest income fell, funding costs rose, and capital markets were muted.
The Charlotte, North Carolina-based bank now expects full-year adjusted revenue (taxable equivalent) to rise 1%-2% compared with its previous outlook of 5%-7% growth. For Q3, the company expects adjusted revenue to fall 4% from Q2’s $5.97B, implying Q3 adjusted revenue of $5.73B, less than the $5.88B consensus.
Q2 adjusted EPS of $0.92, vs. the $1.03 average analyst estimate, fell from $1.05 in the prior quarter and from $1.09 a year ago.
Q2 net interest income of $3.68B fell from $3.92B in Q1 and rose from $3.44B in Q2 2022. Net interest margin of 2.91% dropped from 3.17% in the prior quarter and increased from 2.89% in the year-ago period.
Q2 total noninterest expense of $3.75B vs. $3.69B in the previous quarter and $3.58B in year earlier.
Adjusted preprovision net revenue for the quarter was $2.41B, down 9.3% from the previous quarter due to lower net interest income and higher noninterest expense, partially offset by higher noninterest income.
Q2 provision for credit losses increased to $538M from $502M in Q1 and from $171M in Q2 2022. Net charge-off rate rose to 0.54% vs. 0.37% in the previous quarter and 0.22% in the year-ago period.
Deposits slipped in the quarter, with average total deposits of $400B vs. $408B in Q1.
Average total loans and leases held for investment were $326B, basically flat from Q1.
Conference call at 8:00 AM ET.
Earlier, Truist Financial (TFC) GAAP EPS of $0.92 misses by $0.9, revenue of $5.97B misses by $10M