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Loan Growth, Fee Income Strength to Drive Truist's Q3 Earnings
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Key Takeaways
Truist's Q3 earnings are expected to rise 12.5% to $1.17 per share, with revenues increasing 2.4% to $5.31B.
TFC's NII is projected to rise 1% to $3.67B, aided by loan demand and stabilizing funding costs.
Truist's fee income growth may support results, but rising expenses and weakening asset quality pose risks.
Truist Financial (TFC - Free Report) is set to announce third-quarter 2026 results on Oct.16 before the opening bell. The overall decent lending scenario in the quarter is likely to have supported the company’s net interest income (NII).
Per the Fed’s latest data, the demand for commercial and industrial (C&I) loans (accounting for almost 50% of TFC’s total loans and leases held for investment) slightly weakened in the to-be-reported quarter. On the other hand, demand for consumer loans (almost 40% of total loans) remained solid.
The Zacks Consensus Estimate for TFC’s average earning assets for the quarter is pegged at $495.1 billion, indicating a 1.9% rise from the prior-year quarter.
The Federal Reserve increased interest rates by 25 basis points in September and hinted at a hawkish tone. The rate hike is less likely to have affected Truist’s net interest income (NII) and margin in the third quarter. Nonetheless, modest loan demand, decent economic growth and stabilizing funding/deposit costs are expected to have driven Truist’s NII higher.
In mid-September, the company announced its exit from its near-prime auto lending business by selling approximately $5.5 billion in loans originated by Regional Acceptance Corporation, TFC’s indirect auto lending subsidiary. The sale is expected to generate about $5.2 billion in net proceeds, which the company plans to use to repay wholesale borrowings and reposition certain available-for-sale securities. These actions are expected to improve the company’s funding profile and liquidity flexibility.
The consensus estimate for NII is pegged at $3.67 billion, implying a 1% increase. The company anticipates NII to increase roughly 1.5% sequentially.
Other Factors to Influence Truist’s Q3 Earnings
Non-Interest Income: Mortgage rates hovered near 7% in the third quarter and, as such, refinancing activities and origination volume were subdued. So, growth in Truist’s mortgage banking income is expected to have been modest. The Zacks Consensus Estimate for the metric of $121.9 million indicates a 3.3% rise from the prior-year quarter.
Higher client activity and volatility in the capital markets, along with industry-wide decent deal-making activities, in the to-be-reported quarter are expected to have supported TFC’s corresponding fee income. The consensus estimate for investment banking and trading income of $361.5 million indicates year-over-year growth of 11.9%.
The decent lending backdrop is likely to have supported Truist’s lending-related fees. The Zacks Consensus Estimate for the same is $113.7 million, indicating a rise of 10.4%. As the U.S. markets witnessed investor rotation amid the changing macro environment, there has been a rise in asset inflows. The consensus estimate for wealth management income of $382.5 million suggests an increase of 2.3%.
The Zacks Consensus Estimate for total non-interest income is pegged at $1.65 billion, which indicates a 5.9% rise from the prior-year quarter. Management expects non-interest income to remain almost stable compared with the second-quarter level.
Expenses: Truist has been witnessing a continued rise in overall non-interest expenses over the past several quarters because of investments in technology, inflationary pressure and expansion efforts. A similar trend is expected to have continued in the third quarter.
Management expects GAAP non-interest expenses to rise 2% from the prior quarter.
Asset Quality: Truist is likely to have set aside a substantial amount for potential loan delinquencies amid changes in the monetary policy stance and persistent inflation. Hence, provision numbers are expected to have risen in the third quarter.
The Zacks Consensus Estimate for total non-accrual loans and leases of $1.83 billion suggests 16.6% year-over-year growth. The consensus estimate for total non-performing assets is $1.89 billion, indicating a 16.1% increase.
Truist’s Q3 Earnings & Sales Expectations
The Zacks Consensus Estimate for TFC’s earnings of $1.17 per share has moved 4.5% higher over the past seven days. This indicates growth of 12.5% from the year-ago reported number.
Truist Financial Corporation Price and EPS Surprise
The consensus estimate for sales is pegged at $5.31 billion, suggesting a 2.4% rise. The company expects revenues to rise 1% sequentially.
What the Zacks Model Unveils for TFC
According to our quantitative model, the chances of Truist beating the Zacks Consensus Estimate for earnings this time are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Truist is +2.67%.
Zacks Rank: TFC currently carries a Zacks Rank #3.
TFC’s Peers Worth Considering
Here are a couple of Truist’s peer bank stocks that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time:
The Earnings ESP for The PNC Financial Services Group, Inc. (PNC - Free Report) is +0.80%, and it carries a Zacks Rank #3. The company is slated to report third-quarter 2026 numbers tomorrow.
Over the past seven days, the Zacks Consensus Estimate for PNC Financial’s quarterly earnings has been marginally lowered to $4.97.
View the Zacks #1 Rank List
Image: Shutterstock
Loan Growth, Fee Income Strength to Drive Truist's Q3 Earnings
Key Takeaways
Truist Financial (TFC - Free Report) is set to announce third-quarter 2026 results on Oct.16 before the opening bell. The overall decent lending scenario in the quarter is likely to have supported the company’s net interest income (NII).
Per the Fed’s latest data, the demand for commercial and industrial (C&I) loans (accounting for almost 50% of TFC’s total loans and leases held for investment) slightly weakened in the to-be-reported quarter. On the other hand, demand for consumer loans (almost 40% of total loans) remained solid.
The Zacks Consensus Estimate for TFC’s average earning assets for the quarter is pegged at $495.1 billion, indicating a 1.9% rise from the prior-year quarter.
The Federal Reserve increased interest rates by 25 basis points in September and hinted at a hawkish tone. The rate hike is less likely to have affected Truist’s net interest income (NII) and margin in the third quarter. Nonetheless, modest loan demand, decent economic growth and stabilizing funding/deposit costs are expected to have driven Truist’s NII higher.
In mid-September, the company announced its exit from its near-prime auto lending business by selling approximately $5.5 billion in loans originated by Regional Acceptance Corporation, TFC’s indirect auto lending subsidiary. The sale is expected to generate about $5.2 billion in net proceeds, which the company plans to use to repay wholesale borrowings and reposition certain available-for-sale securities. These actions are expected to improve the company’s funding profile and liquidity flexibility.
The consensus estimate for NII is pegged at $3.67 billion, implying a 1% increase. The company anticipates NII to increase roughly 1.5% sequentially.
Other Factors to Influence Truist’s Q3 Earnings
Non-Interest Income: Mortgage rates hovered near 7% in the third quarter and, as such, refinancing activities and origination volume were subdued. So, growth in Truist’s mortgage banking income is expected to have been modest. The Zacks Consensus Estimate for the metric of $121.9 million indicates a 3.3% rise from the prior-year quarter.
Higher client activity and volatility in the capital markets, along with industry-wide decent deal-making activities, in the to-be-reported quarter are expected to have supported TFC’s corresponding fee income. The consensus estimate for investment banking and trading income of $361.5 million indicates year-over-year growth of 11.9%.
The decent lending backdrop is likely to have supported Truist’s lending-related fees. The Zacks Consensus Estimate for the same is $113.7 million, indicating a rise of 10.4%. As the U.S. markets witnessed investor rotation amid the changing macro environment, there has been a rise in asset inflows. The consensus estimate for wealth management income of $382.5 million suggests an increase of 2.3%.
The Zacks Consensus Estimate for total non-interest income is pegged at $1.65 billion, which indicates a 5.9% rise from the prior-year quarter. Management expects non-interest income to remain almost stable compared with the second-quarter level.
Expenses: Truist has been witnessing a continued rise in overall non-interest expenses over the past several quarters because of investments in technology, inflationary pressure and expansion efforts. A similar trend is expected to have continued in the third quarter.
Management expects GAAP non-interest expenses to rise 2% from the prior quarter.
Asset Quality: Truist is likely to have set aside a substantial amount for potential loan delinquencies amid changes in the monetary policy stance and persistent inflation. Hence, provision numbers are expected to have risen in the third quarter.
The Zacks Consensus Estimate for total non-accrual loans and leases of $1.83 billion suggests 16.6% year-over-year growth. The consensus estimate for total non-performing assets is $1.89 billion, indicating a 16.1% increase.
Truist’s Q3 Earnings & Sales Expectations
The Zacks Consensus Estimate for TFC’s earnings of $1.17 per share has moved 4.5% higher over the past seven days. This indicates growth of 12.5% from the year-ago reported number.
Truist Financial Corporation Price and EPS Surprise
Truist Financial Corporation price-eps-surprise | Truist Financial Corporation Quote
The consensus estimate for sales is pegged at $5.31 billion, suggesting a 2.4% rise. The company expects revenues to rise 1% sequentially.
What the Zacks Model Unveils for TFC
According to our quantitative model, the chances of Truist beating the Zacks Consensus Estimate for earnings this time are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Truist is +2.67%.
Zacks Rank: TFC currently carries a Zacks Rank #3.
TFC’s Peers Worth Considering
Here are a couple of Truist’s peer bank stocks that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time:
The Earnings ESP for The PNC Financial Services Group, Inc. (PNC - Free Report) is +0.80%, and it carries a Zacks Rank #3. The company is slated to report third-quarter 2026 numbers tomorrow.
Over the past seven days, the Zacks Consensus Estimate for PNC Financial’s quarterly earnings has been marginally lowered to $4.97.
M&T Bank Corporation (MTB - Free Report) is scheduled to announce third-quarter 2026 results on Oct. 16. The company carries a Zacks Rank #3 and has an Earnings ESP of +0.73% at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Quarterly earnings estimates for M&T Bank have been revised lower to $4.98 over the past week.