- Key insight: Truist rolled out a new, higher profitability target, citing increased confidence in its ability to execute on strategic priorities, as well as the revised Basel III endgame proposal.
- What’s at stake: The bank’s new long-term target for return on tangible common equity, which measures banks’ overall financial performance, puts it more in line with some of its regional peers.
- Forward look: Truist revised its share buyback plans for this year, saying it now expects to repurchase $5 billion of common shares this year, up from the $4 billion it projected in January.
UPDATE: This article has been updated to include information from Truist’s first-quarter earnings call and remarks from an analyst’s note.
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Truist Financial established a new, higher profitability target Friday, citing the strength of its performance and confidence in management’s ability to achieve the company’s strategic priorities.
The $549 billion-asset regional bank said it would aim to achieve a return on tangible common equity of 16% to 18% over the next three to five years. Truist’s higher target is in line with the profitability goals at other regional banks, such as U.S. Bancorp and Citizens Financial Group.
The heightened profitability expectations come less than two years after Charlotte, North Carolina-based Truist lowered its outlook for return on tangible common equity, a metric that helps measure a bank’s overall financial performance.
Facing mounting pressure for missing the low-20s percentage target it established when the bank was formed by a merger of equals in 2019, management in September 2024 reduced its goal to the mid-teens over approximately three years.
Recent growth in loans and deposits, higher fee income and “prudent” capital allocation are some of the factors giving the bank confidence that it can aim higher than the 14% return on tangible common equity that it expects to achieve this year and the 15% it anticipates reaching for all of 2027, Truist CEO Bill Rogers said Friday during the bank’s first-quarter earnings call.
The latest Basel III endgame proposal is also a factor, Rogers said. That proposal would reduce Truist’s risk-weighted assets by approximately 9%, Chief Financial Officer Mike Maguire said.
“We feel confident where we’re going,” Rogers responded when an analyst asked him to explain why the bank established a new profitability target now. “We felt it was important to start putting a stake in the ground. … We just feel really good about the momentum we’re building.”
Investors seemed to appreciate Truist’s performance and its improved outlook. Its stock price was up more than 3% as of midday Friday. Shares are up about 2.9% year to date.
For the first quarter, Truist reported a return on tangible common equity of 13.8%. That’s up from 12.7% in the prior quarter and an improvement from 12.3% in the same quarter last year.
The new, higher target “is important because it puts [Truist] into the same league as peers,” Scott Siefers, an analyst at Piper Sandler, wrote Friday in a research note. It should also help Truist’s argument that its valuation is too low, he said. The bank’s current market capitalization is $61.3 billion, an improvement from $53.9 billion in the year-ago quarter, according to Yahoo! Finance.
During the call Friday, Rogers addressed a question about the bank’s interest in doing mergers and acquisitions, either as a seller or a buyer. A Bloomberg article in March included Truist and PNC Financial Services Group as two large regionals that could be acquisition targets for Citi.
“Let’s just, like, set that aside,” Rogers said. “We’ve set forth a plan that achieves mid-teens [earnings per share] growth over an extended period of time and under a really good risk posture … that provides an advantaged return to our shareholders. And that’s always going to be the goal, [to] make sure we have a plan that gives an advantage return to our shareholders.”
Facing a similar question earlier this week, Citi CEO Jane Fraser brushed off the notion that Citi will buy a bank, saying the New York-based company is “focused on organic growth, period, end of story.”
Earnings beat
The first quarter was largely positive for Truist, which reported a boost in net income, reflecting an increase in average loans and a pickup in fee income, including a surge in investment banking activity. Net income totaled $1.48 billion for the period ending March 31.
That’s an increase of 17.5% from the same quarter last year. Earnings per diluted share were $1.09, beating analysts’ predictions by nine cents, according to S&P Capital IQ.
For the quarter, Truist delivered firmwide revenues of $5.15 billion, up about 5% compared with the same quarter in 2025. Average total loans grew 7% year over year to $329 billion, driven by a 4% year-over-year increase in average loans in the consumer and small-business banking segment and a 9% year-over-year hike in average loans in the wholesale banking segment.
Net interest income totaled $3.6 billion for the quarter, up 2.6% from the year-ago quarter.
Fee income of $1.6 billion rose 11.6% year over year. Investment banking and trading income was a major driver, improving 36.3% during the quarter. Lending-related fees surged 24.2% year over year, while mortgage banking income increased by 23.1%.
Noninterest expenses of $3 billion were up 2.6% year over year, due to higher personnel costs such as increased salaries, incentives and employee benefits related to hiring, the bank said.
During the quarter, Truist repurchased $1.1 billion shares of common stock. In December 2025, its board authorized the repurchase of up to $10 billion of common stock with no expiration date.
It expects to buy back $5 billion shares of common stock throughout all of 2026, it said Friday. That’s up from January, when management said it would buy around $4 billion for the year.
Truist said it will buy back around $1.2 billion of shares during the second quarter.
Also during the quarter, Truist’s private wealth business announced that financial advisors for Truist Investment Services are now able to offer two federally regulated spot bitcoin exchange‑traded funds, sponsored by Fidelity and BlackRock. The ETFs are also available through Truist Trade, an offering for clients interested in self-directed real-time trading, the bank said in a press release.
Truist also announced several new hires during the three-month period, including the hiring of Matthew Miller as managing director and head of mergers and acquisitions for Truist Securities. Miller most recently worked at Jefferies, where he was global head of health M&A, Truist said.
In March, Truist announced a data access partnership with the data aggregator Plaid. The agreement offers Truist a way to expand its open banking capabilities.
