8-KMaterial AgreementsFinancial Events

FIFTH THIRD BANCORP 8-K Report, Material Agreement (Mar 2, 2016)

Filed March 2, 2016For Securities:FITBFITBOFITBPFITB-PIFITB-PMFITB-PAFITBIFITB-PK

Summary

Fifth Third Bancorp (FITB) announced on March 1, 2016, that it entered into a share repurchase agreement with Morgan Stanley & Co. LLC to buy back approximately $240 million of its outstanding common stock. This repurchase is part of the company's previously announced 100 million share repurchase program initiated in March 2014. The transaction is expected to settle on or before June 2, 2016, with Fifth Third making a payment of $240 million on March 4, 2016, and receiving a substantial majority of the shares by the same date. Investors should note that the exact number of shares repurchased will be based on a discount to the average daily volume-weighted average prices during the repurchase agreement's term. There are also provisions for potential adjustments, including Morgan Stanley's right to terminate the agreement under certain extraordinary events, which could result in Fifth Third receiving fewer shares than initially anticipated. This repurchase activity signals the company's commitment to returning capital to shareholders.

Key Highlights

  • 1Fifth Third Bancorp entered into a $240 million share repurchase agreement with Morgan Stanley.
  • 2The repurchase is part of a larger 100 million share buyback program announced in March 2014.
  • 3Fifth Third will pay $240 million on March 4, 2016, expecting to receive most shares by then.
  • 4The settlement of the transaction is expected to be completed by June 2, 2016.
  • 5The number of shares repurchased will be influenced by market prices and potentially subject to discounts.
  • 6The agreement includes termination provisions for Morgan Stanley under specific extraordinary events, which could affect the number of shares received by Fifth Third.

Frequently Asked Questions

This 8-K filing is primarily to report the entry into a material definitive agreement, specifically a share repurchase agreement between Fifth Third Bancorp and Morgan Stanley & Co. LLC, through which the company plans to buy back approximately $240 million of its own stock.

This $240 million repurchase is part of a larger, previously announced share repurchase program of up to 100 million shares that Fifth Third Bancorp initially announced on March 18, 2014.

Fifth Third Bancorp expects to make its payment of $240 million on March 4, 2016, and anticipates receiving a substantial majority of the underlying shares by the same date. The final settlement of the transaction is expected to occur on or before June 2, 2016.

Yes, the exact number of shares Fifth Third will receive is based on market prices during the agreement's term, and Morgan Stanley may deliver additional shares or Fifth Third may owe cash/stock. Furthermore, Morgan Stanley has the right to terminate the agreement under certain extraordinary events, which could result in Fifth Third receiving fewer shares than initially expected.