Truist Financial Corp (TFC.N): 2Q26 Review - Solid Quarter with Our Near-Term Return Outlook Still Aligned with Mgmt Targets

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Truist Financial Corp (TFC.N): 2Q26 Review - Solid Quarter with Our Near-Term Return Outlook Still Aligned with Mgmt Targets

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20 Jul 2026 22:19:13 ET │ 13 pages

Truist Financial Corp (TFC.N)

2Q26 Review - Solid Quarter with Our Near-Term Return Outlook Still

Aligned with Mgmt Targets

CITI'S TAKE Neutral

Price (20 Jul 26 16:00) US$51.00 TFC slightly outperformed on earnings day (down ~1.4% vs BKX down

Target price US$54.00 ~1.5%) following a ~6c core PPNR beat on fees + expenses, partly offset by

softer NII print and modest NIM compression to 2.98% (down 4bps q/q vs Expected share price return 5.9%

cons flat at 3.02%). Mgmt commentary pointed to three headwinds: 1) Expected dividend yield 4.2%

loan remix from select consumer portfolios, 2) tighter loan spreads and 3) Expected total return 10.1%

higher deposit costs associated with commercial deposit growth. In our Market Cap US$62,303M

view, the loan remix helps counteract last year's imbalance between loan

growth (3.6% y/y) and deposit growth (2.2% y/y), which increased reliance

on brokered and wholesale funding. Mgmt's focus to selectively moderate

growth in certain portfolios should help restore funding balance and NIM Benjamin GerlingerAC

stability over time, albeit with our near-term outlook modestly lower. We +1-212-816-3538

continue to see credible path to 14%+ ROTCE in '26 and 15% in '27, benjamin.gerlinger@citi.com

although our normalized assumption of 15% remains below 16-18% mgmt Mikhail Mrotchek

target. +1-212-816-2345

misha.mrotchek@citi.com

Estimate Changes — Our 2026E EPS increases 20c to $4.60 (vs. FactSet Kaili Wang, CFA

consensus of $4.58), 2027E EPS increases 15c to $5.05 (vs. FactSet consensus of +1-716-730-7408

$5.05), and 2028E EPS increases 15c to $5.65.