8-KFinancial EventsRegulation FDExhibits & Filings

FIFTH THIRD BANCORP 8-K Report, Exit or Disposal Costs (Sep 13, 2016)

Filed September 13, 2016For Securities:FITBFITBOFITBPFITB-PIFITB-PMFITB-PAFITBIFITB-PK

Summary

Fifth Third Bancorp (FITB) filed an 8-K on September 13, 2016, reporting on actions related to its consumer distribution network. The company announced plans to consolidate or sell 44 additional branch locations and 5 parcels of undeveloped land. These closures are expected to occur in the first quarter of 2017, with associated contract termination costs estimated between $4 million and $6 million. The filing also disclosed an estimated non-cash impairment charge for the third quarter of 2016, ranging from $25 million to $30 million, related to these asset assessments. These strategic decisions reflect Fifth Third Bancorp's ongoing evaluation of its branch network in response to changing customer preferences and channel usage. The impairment charge indicates a write-down of asset values, which investors should consider when assessing the company's profitability for the third quarter of 2016. The presentation at the Barclays Global Financial Services Conference, also referenced in the filing, may provide further context on these strategic moves and the bank's overall financial outlook.

Key Highlights

  • 1Fifth Third Bancorp plans to close or sell 44 additional branch locations and 5 undeveloped land parcels.
  • 2These closures are expected to take place in the first quarter of 2017.
  • 3Estimated contract termination costs for real estate leases are in the range of $4 million to $6 million.
  • 4A non-cash impairment charge of $25 million to $30 million is anticipated for the third quarter of 2016.
  • 5The actions are driven by evolving customer preferences and an assessment of the consumer distribution network.
  • 6The company presented at the Barclays Global Financial Services Conference on September 13, 2016.

Frequently Asked Questions

The closures and sales are part of an ongoing assessment of the company's consumer distribution network. Fifth Third Bancorp is responding to changing customer preferences and how customers use different channels to access its products and services.

The company anticipates incurring contract termination costs related to real estate leases between $4 million and $6 million in the first quarter of 2017. Additionally, a non-cash impairment charge of $25 million to $30 million is expected to be recognized in the third quarter of 2016, reflecting the write-down of certain long-lived assets.

The planned consolidation or sale of the 44 branch locations is expected to occur during the first quarter of 2017.

Yes, Fifth Third Bancorp also announced that it presented at the Barclays Global Financial Services Conference on September 13, 2016. Information from this presentation is attached as an exhibit to the filing.