Fifth Third Bancorp Q1 FY2025 earnings call

• Tim Spence emphasized navigating uncertain environments as key, with strong Q1 performance including EPS, PPNR, and ROE. Loan growth, net interest margins, charge-off rate, and operating leverage were positive. Core deposits were stable, NII grew, and adjusted fees and wealth/asset management revenue increased. • Bryan Preston discussed adjusted revenue growth, NII momentum, loan growth, proactive deposit management, fee performance, expense discipline, credit metrics (net charge-off ratio, NPA ratio), and capital position (CET1 ratio at 10.5%).

In Q1 2025, Fifth Third reported earnings per share of $0.71 (or $0.73 excluding certain items) exceeding consensus estimates. PPNR grew 5% year over year, and adjusted return on equity was 11.2%. Tangible book value per share increased 15% year over year. Total loans grew 3% year over year, driven by middle market C&I, leasing, and consumer secured lending. NII grew 4% year over year with net interest margins expanding for the fifth consecutive quarter. Adjusted fees excluding securities gains and losses were up 1%, commercial payments grew 6%, and wealth and asset management revenue grew 7% with AUM up 10%. Core deposits were stable, and expenses were flat vs prior year with positive operating leverage.

• Full-year NII expected to increase 5%-6%, consistent with January guide. Full-year average total loans expected up 4%-5% driven by C&I and auto loans. • Adjusted non-interest income expected up 1%-3%, adjusted non-interest expense up 2%-3%. Adjusted revenue expected up 4%-5%, PPNR 6%-7%, and positive operating leverage 150-200 basis points. • Second-quarter NII expected up 2%-3%, average total loans up 1%, adjusted non-interest income up 2%-6% (wider range due to uncertainty), adjusted non-interest expense down 5%, charge-offs 45-49 basis points. • Target to repurchase $400 million to $500 million of stock in second half of 2025.

• Economic uncertainty, including tariff impacts and potential C&I loan demand softening. • Capital markets disruption affecting fee income. • Credit concentration risks and uncertainties in tariff policies impacting business and credit quality. • Potential for inflation pick-up and economic growth decline with uncertain impact on unemployment and consumer spending.

Q: Ken Usdin asked about regulatory environment and industry consolidation.

A: Tim Spence said regulators focus on deregulation to ignite growth, and industry consolidation is likely with fewer banks in the future.

Q: Peter Winter asked about SNC portfolio and NII guidance.

A: Tim Spence and Greg Schroeck said SNC portfolio is performing well, diversified, and underwritten to standards; Bryan Preston discussed NII guidance with factors like deposit seasonality and rate cuts affecting puts and takes.