During this morning's call, they will discuss Truist Financial Corporation's third quarter results, share their perspectives on current business conditions, and provide an updated outlook for the remainder of 2025. The accompanying presentation, as well as our earnings release and supplemental financial information, are available on the Truist Investor Relations website, ir.truist.com. These initiatives include accelerating growth through the addition of new clients and deepening existing relationships in areas like payments, wealth, and premier banking. We're executing our plan while maintaining our expense and credit discipline and returning capital to shareholders.
During the third quarter, average loan balances increased 2.5%, as we saw broad-based growth across our wholesale and consumer segments, driven by increased loan production and new client acquisition. Adjusted expenses remain well controlled and were up just 1% late quarter, which, along with a strong revenue performance, helped drive 270 basis points of late quarter positive operating leverage. Finally, we remain in a strong capital position, which allowed us to support our balance sheet growth and return capital to shareholders. During the quarter, we returned $1.2 billion of capital to shareholders through our common stock dividend and the repurchase of $500 million of our common stock.
In summary, our third quarter results were strong as the combination of improved revenue, discipline expense and credit management, and robust capital return drove 130 basis points sequential improvement in our ROTCE to 13.6%. Average loan balances increased 2% late quarter and 7% versus the third quarter of 2024, driven by a significant increase in production. Notably, Gen Z and Millennials represented 63% of this growth, a strong signal that our digital-first approach is resonating with the next generation of Truist clients. In wholesale, I'm encouraged by this quarter's loan growth, improvement in investment banking and trade revenue, and progress in key focus areas like payments and wealth.
| Metric | Period | Current guidance |
|---|---|---|
| Share repurchases | Q4 2025 | approximately $750 million (up) |
| Share repurchases | 2026 | $3 billion-$4 billion (up) |
| Revenue growth rate | 2026 | more than double 2025 (call it 4%+) (up) |
| Net interest income | Q4 2025 | grow approximately 2% linked quarter (up) |
| Interest-bearing deposit beta | Q4 2025 | mid-40% area (assuming two cuts) (up) |
| Positive operating leverage | 2026 | higher than 2025 (up) |
| ROTCE | Full year 2027 | 15% target (up) |
| CET1 ratio target | End of 2027 | 10% (n/a) |
| Metric | YoY | Note |
|---|---|---|
| Adjusted revenue | up 3.7% linked quarter | 9.9% growth in non-interest income and 1.2% growth in net interest income |
| Investment banking and trading income | up 58% linked quarter to $323 million | improved performance with strength in debt capital markets and trading revenue |
| Wealth management income | fees up 7.5% linked quarter | higher market values, positive net asset flows, and new client acquisitions |
| Taxable equivalent net interest income | up 1.2% linked quarter ($45 million) | one additional day, loan growth, and fixed-rate asset repricing |
| Adjusted expenses | up 2.4% versus Q3 2024 | higher personnel expense |
| Net charge-offs | down 7 basis points to 48 basis points | lower CRE losses |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Investment banking and trading | weak first half with April disruption | back to a sustainable level, hitting on a lot of cylinders with strong pipelines | Improving |
| Deposit beta | 37% in Q2 | 38% in Q3, on track to mid-40% in Q4 | Improving |
| NDFI / credit scrutiny | n/a | 11% of total lending, ranked 9th of 11 peers, highly diversified across 20+ asset classes, mostly REITs and asset securitization | Stable |
| Fixed-rate asset repricing | tailwind | continues as a tailwind but a diminishing one with a long tail | Stable |
| ROTCE trajectory | 12.3% prior quarter | 13.6%, targeting 15% in 2027 | Improving |