10-KPeriod: FY2023

TRUIST FINANCIAL CORP Annual Report, Year Ended Dec 31, 2023

Filed February 27, 2024For Securities:TFCTFC-POTFC-PRTFC-PI

Summary

Truist Financial Corporation (TFC) reported a net loss of $1.5 billion for the year ended December 31, 2023, a significant shift from the $5.9 billion net income reported in 2022. This loss was primarily driven by a substantial non-cash goodwill impairment charge of $6.1 billion related to its Consumer Banking and Wealth (CB&W) and Corporate and Commercial Banking (C&CB) reporting units. Excluding this impairment and other discrete items like the FDIC special assessment, the company's underlying operational performance showed resilience amidst economic uncertainty. Despite the reported net loss, Truist demonstrated a strengthening capital position, with its Common Equity Tier 1 (CET1) ratio increasing to 10.1% at year-end 2023, bolstered by organic capital generation and the sale of a minority stake in its insurance business. The company maintained its commitment to clients by supporting their financial needs and continued its strategic initiatives aimed at simplifying operations and improving efficiency. Truist also highlighted its community engagement efforts, contributing significantly to affordable housing and volunteer service.

Financial Highlights

39 data points
Beta

Net Income

-$1.05B

EPS (Diluted)

$-1.09

Total Assets

$535.35B

Cash & Equivalents

$30.64B

Free Cash Flow

$8.63B

Financial Statements
Beta
Operating Income-$1.50B
Interest Expense$9.86B
Net Income-$1.05B
EPS (Basic)$-1.09
EPS (Diluted)$-1.09
Shares Outstanding (Basic)1.33B
Shares Outstanding (Diluted)1.33B

Key Highlights

  • 1Net loss of $1.5 billion for 2023, impacted by a $6.1 billion non-cash goodwill impairment charge.
  • 2CET1 ratio improved to 10.1% at year-end 2023, reflecting organic capital generation and a minority stake sale in its insurance business.
  • 3Total revenue increased by $433 million to $23.4 billion, driven by higher net interest income.
  • 4Provision for credit losses significantly increased to $2.1 billion in 2023 from $777 million in 2022.
  • 5Noninterest expense rose substantially due to the goodwill impairment and a $507 million FDIC special assessment.
  • 6The company is undergoing a transformation to simplify operations and improve efficiency, with headcount reductions and business line consolidations already underway.
  • 7Truist is proceeding with the sale of its remaining 80% stake in Truist Insurance Holdings (TIH) for approximately $10.1 billion after-tax, expected to close in Q2 2024.

Frequently Asked Questions

Truist Financial Corporation reported a net loss of $1.5 billion for the year ended December 31, 2023. The primary driver of this loss was a non-cash goodwill impairment charge of $6.1 billion, primarily related to its Consumer Banking and Wealth (CB&W) and Corporate and Commercial Banking (C&CB) reporting units.

Truist's capital position strengthened during 2023. Its Common Equity Tier 1 (CET1) ratio improved to 10.1% as of December 31, 2023, up from 9.0% at December 31, 2022. This increase was attributed to organic capital generation and the sale of a minority stake in its insurance business (TIH).

Truist announced an agreement to sell its remaining 80% stake in Truist Insurance Holdings (TIH) to an investor group for approximately $10.1 billion after-tax. The transaction is expected to close in the second quarter of 2024, subject to customary closing conditions and regulatory approvals. This sale will result in the full deconsolidation of TIH and is expected to improve Truist's relative capital position and provide strategic flexibility.

Truist's total revenue increased by $433 million to $23.4 billion for the year ended December 31, 2023, compared to $23.0 billion in 2022. This growth was primarily driven by an increase in net interest income, which rose by $362 million to $14.8 billion, mainly due to higher market interest rates and increased average loans.