TFC - Earnings call transcript Q1 2020 | Truist Financial Corporation

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Operator

Greetings, ladies and gentlemen, and welcome to the Truist Financial Corporation First Quarter 2020 Earnings Conference Call. Currently, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation.

As a reminder, this event is being recorded.

It is now my pleasure to introduce your host, Mr. Investor Truist of Corporation. Director Richards, Relations Financial for Ryan Please go ahead.

Ryan Richards

and John, you're We good appreciate you, doing you sincerely everyone. and morning, Thank today joining well. us

and Chief today's review will second quarter some Officer, On quarter Chairman provide first Financial and and for are Kelly Daryl call our King, thoughts our results Bible, of Chief Officer, Executive the XXXX.

of Officer, Starnes, Rogers, Operating Q&A Officer; participate our Head We our the Chief Chris Clarke and Risk and also Banking our have session. Insurance; President to Bill in Chief and Henson,

Note from that our teammates. call we are conducting different executives our today provide locations to and

We Investor will and a presentation website. Relations release available supplemental as presentation, A during today's are reference of the copy earnings slide as financial Truist our the well information, call. on

public or not that forecasts. does Please note Truist earnings predictions provide

and may uncertainties, the there or beliefs inherent These SEC However, call this cautionary statements the presentation contemplated refer differ during forward-looking in and by including notes management's forward-looking impact our actual risks be filings. that statements. subject our to information these intentions, express COVID-XX, Please materially from statements Truist's to and results those are regarding may expectations. made of

that refer the the our certain Please also GAAP. X reconciliations measures. appendix Please includes note to financial to of non-GAAP appropriate our presentation for and page presentation

now, And Kelly. I will turn to it over

Kelly King

in safe well joining I in. certainly call. and you difficult hope all our Ryan. your you, for everybody. and families morning, Thank are Thank Good environment you living the we're

than matters of things talk into culture I just about. about the take to because culture we the we a most more numbers now want minute to of can get I before all believe, talk ever,

out and absolutely purpose us better that say purpose. inspire This live for that a is So, communities. to us build is to time you've heard our and critical lives

So, day. that clients, very, – seriously our is in every very on focusing – do order our we our our and stakeholders teammates and that mission

focus and the team, this ultimately, for as teammates. to on caring, our happiness focusing are of trustworthy, be on Our our health success teammates. safety operate one one, values during number We're and, environment,

of able We XX,XXX about are pleased XX,XXX work that to teammates remotely. our are

a energy a spending supporting through $XX particularly focus Protection clients, our our spending of the our that lot Program. in Payroll are million lot time We're and Truist we on communities We donations of cycle. philanthropic did early supporting Cares the

working kind program I'll to positive stand are the where really, were working incredible an results really It's They're They're of up clients automated see applications in to terms in their very, automatically tell many to XX/X you our very overnight, of closely that with like getting, in that hard. working people cases. our the together. us teammates to able getting PPP literally portal particularly allow in. our access we're

expected. today ever we can you to our bonding have And is say teammates culture would faster that Our than really at strong. Truist are I really,

on I'm on presentation, following you're If the slide X.

by reminder, as a combination, we're bank the Just sixth US and assets commercial market largest the value. after

the X weighted XX very MSAs. have deposit in We share strong, a average market number top

XX XX,XXX teammates. have households, We million

to achieve think, our positioned, are We purpose. we very well

just about and to going is We quality. of cover are this and continuing in financial lot grow to one liquidity rated bit. recognized a as a to Daryl of period capital institutions, highest of the flight loans very particularly in deposits, information strong and we're our

is diversification real a point would I out strength. that our

and geographies. in are very products, We services diversified

commercial forbearance, assistance, uniquely of ways for basic with We've ATM card clients. X% clients. surcharges. needs. purchases things the X, about the XX,XXX providing payment we we're can our we over important deferrals, regard for we accommodations we're waived We've And qualifying cashback XXX,XXX consumers, already a relief our offering Like some done including others, on temporarily for slide have help other extensions, talk been to crisis. On doing

XX% We're those to that to activity. have. we've branches drive-throughs, of able fortunate clients in terms particular needs real that our interventions branches they our open in of We're able terms we've to pleased keep been appointment allow of continue with been have so

focused Paycheck the Protection We've been really Program. on

amount for about loan XXX,XXX. on is a if be We've and it funding average fact $XX expecting And million XX,XXX Our employees. will in X representing more the to first companies, authorized is round, round, second the been it be more approved. than little we're likely on about billion

ways small And hesitation, businesses without been for we've providing to line commercial financial We're in extensive draws other fund, clients. able also. relief our programs many for

XX% very to for aggressive other strategies less our teammates awarded year. safety provide we've providing in $XXX,XXX them. about to teammates, $X,XXX relief our making work a coronavirus alternative work than teammates our For for from and of been bonuses We've home

We those rate for pay also at pay for not. that that be $XX to roles, hourly increased those on with onsite have special critical those in a day work for are $X.XX special our and

donate $X helps teammates our contributing hardship One Fund, teammates financial every that our in $X is to are our Foundation need assistance. that Truist Our for which Truist and Team

earlier to Way $X million million each of for million communities, really We which gone the CDC help. Truist Foundation donated organizations. our $X has to Hopkins. philanthropic local a and our donated For $XX contribution announced And Foundation a we United Johns long way

income a $X.X billion. Adjusted Diluted $X.XX net was few just available basis billion per common seven, on We financial have $X.XX. shareholders highlights. in was did adjusted an taxable-equivalent to earnings revenue. page On share

very in ratio equity tangible was XX.X%, on Our XX.X%. which efficiency adjusted our was return environment. strong common And is this adjusted

So, feel about good we that. really

insurance of strong performance all And course, because Our continued all lot into of January experiencing quarter. COVID-XX. were have to challenges and a the throughout the then we're really Interestingly, mortgage that like entire and February, ran strong. of we, people,

face. right will we we will as why quality, we storm. Clarke million a the asset the Our And calm in to strong the before provision that's we you, very added anticipation good actually of describe know that is now, but $XXX challenges that's know

on right now. tight one number our and our believe focus a have and is our which clients job our we teammates We communities,

you we of issue just X, to couple the unusual little the know items merger a and this slide the We of the got quarter. If COVID messy, impact. it's a go but

charges so While million negative ones of they're are of call or about tax, $XXX them provide that's million part ongoing these rate, revenues or impact the incremental $X.XX is benefits, after not a we out $X.XX and separately, that expenses, a impact run then, operating and terms And are the but before about future foregone tax, $XX $XX $X.XX. merger-related the share. in million COVID cost

gets is, $X.XX. the my really view, $X.XX you in there of to items, which unusual So, about

interesting it's X, X, If period. deck you and to go an slide leases, in loans been

of that loans about $XXX $XX of March. subsided. $XXX period, had at was by billion. but average the flat It's first part had end of We do can been We billion expect our then. of we billion, That quarter the relatively had into surge the Obviously, drawdowns. see April. We a You about it was another PPP continued kind it's funding. in since $X.X substantial end Again, early billion.

have we about be drawn and process committed in said, $XX soon. loans in billion down we I As relatively expect will

crisis work depth In effect truth the and the we too. know. happen. know depends, going on don't with regard health economy. and to terms the length the we the is through the what's everybody the knock-off how of then that, as It of to wants just But that I obviously, do to market, has

outperform into The going our worst news to from very is, expectations. to the news good will really small is you, bad to this. I the business recover this, economy is and would likely strong. Americans are country believe was Still, resilient struggle say The I

billion. also but some If you flight-to-quality look line page of seasonal which of at $XXX popped had were deposits increases and to that see. moved as we're billion to of an we XX, that very $XXX increase period during $X on same had About then time. that kind deposits billion billion It pleased in, was balances draws, Average some of we $XX up thing.

total average cost we're deposits see. Our to which points, decreased very by X basis of happy

detail. So, give you let now to and him let me turn it some Daryl

Daryl Bible

to and provide on some conditions. Thank points quarter I Today, business color you, from good current first and morning, about the Kelly, everyone. the key want talk

Turning to net of basis margin. to XX interest accounting interest contributed X.XX% points. XX margin slide up Purchase XX, net points basis reported

X liquidity the quarter interest equals, of margin points. full and impact the of was interest down build lower in reflected basis our March. net Core The rates decline merger X.XX%,

points The yield on the benefit for offset basis purchase investment as from loans lower accounting more than and X increased leases held rates. short-term

trimming X to expected The non-interest sensitive yield decreased our Home and loan higher portfolio Federal asset Loan growth, out more basis on Bank points. securities deposits. prepayment, floating bearing We increased became rate due advances

Fed. floating draws, and of XX% Current was XX% interest from lower funding mix a net and will line further loan at margin our elevated reserves the suggest trends PPP fixed. full impact quarter decline rates, Our

are continue we an aggressively and to yields, loan deposit reduce protect To towards production new costs. all we implementing

increased income full $XXX Non-interest reflecting quarter equals. on XX. slide million, the a to merger Turning of

versus million X.X% commissions, P&C increased XXXX $XX pricing. retention organic due and strong increased or first to income Insurance quarter growth, higher

income XXX mortgage were $XX.X basis sale origination points. gain of at was with Residential Refi was on margins billion. volumes strong, originations and XX%

by a is that volume forbearance could While and potential headwind, higher offset be spreads.

fee impacted in million the impacted banking by wider spreads. rates interest was to arising and This due categories the $XX trading quarter, were and CVA increase income several reserves credit by lower from Investment pandemic.

lower insurance related residential production, charges include resulted and As mortgage deposits volume purchase strong asset income due to service shown trends by lower card partially Current discretionary actions and on COVID. the in on to valuations service fees. lower lower strong forbearance, offset slide, payment-related seasonally income, and

$XXX to and a expenses from charges the included the costs merger. $XXX increased and to XX. million Non-interest million merger. of impact quarter expense Merger-related merger-related incremental of Turning operating full restructuring slide related $XX reflecting million,

$XX $XXX,XXX. non-interest to actions all impacted bonus in earning expense a COVID teammates response less to and million than $X,XXX approximately included by Discretionary

Personnel This which expense impacted and assets, income was the offset plan the positively to of of in merger. the net operating included market incremental other in income. decrease interest million expenses by is value $XX non-qualified related

intangible our updated also valuation. We

about annualized result, million. $XXX for expense to full-year revised XXXX a amortization As was

measures Current teammates, trends clients and protect communities. expenses teammates, measures, such as better in client-facing include some and to pay special for our relief

We of good in crisis. continue discipline the to health even have face core expense COVID

XX. Turning slide to

remained have quality will strong, economic apply X. Truist Asset the deteriorated. continue adopted conditions standard January to CECL but

increased basis from PCI CECL MPA to due transition the of and basis X XX ratio Our the points adoption points, to to PCD. largely

PCI transition, to to XX for from were transition. from NPLs basis basis last MPA PCD flat Adjusting to points were ratios this essentially due the loans, and quarter. our year-end, total MPR up primarily points XX

average The million economic quarter in increase of points reflecting Net $XXX growth also provision post-merger weaker charge-offs a were was due a loans, CECL. The XX points. increased mostly The to provision basis scenarios activity. reserving down full of outlook. and a was and the with reflected X basis reflected significant loan accordance

very robust ratio The and Our of the NPLs. charge-offs X.XX was allowance strong fair coverage ratios in total and mark X.XX of a loans. X.XX% resulted combination allowance CECL times coverage our net X.XX%. remains of for unamortized for value adoption at times The

We the matrix expect elevated second to quality portfolios. asset loan COVID stress be across reflecting quarter

to The industries to vulnerable Turning on slide left in XX. environment. the the summarizes believe current most are our table exposure we

meaningful Outstanding totaled low from of diversification loans our for or reflecting of billion have We exposure, at merger. X.X% end the $XX.X the to group investment very loans March. held

sectors. towards oil risk Our lower and weighted gas portfolio is

Outstanding balances $XX.X loans the or for are investment loans leveraged of billion held on levered our of grade investment. $X.X totaled or loans XX% billion equivalent.

adjustments and will continue managing or underwriting appropriate. to risk actively are acceptance these portfolios make We as

slide the initial adoption reflects $XXX increase million the in ACL from conditions. evolving Turning rapidly The CECL to market XX.

implying to scenarios judgment three each use inform the to is to allowance, assign of CECL scenario. the practice standard probability Our

an Moody's scenario include with scenarios and one for stress implied scenario. optimistic rates These baseline

also when of packages relief the with from impact CECL calculating concerns the effects, the together consider industry heightened government We pandemic estimate.

our estimation on XX Slide details loss additional approach. adds

our slide line capital growth balance XX, due a to draws. ratios slightly, to to Turning related significant declined mostly sheet

capital However, well strong capitalized regulatory levels to our relative remain for banks. levels

in was the CETX X.X% Our ratio down X.X%, quarter. fourth

payouts total XX.X% and quarter. dividend the for first are Our

taking are due to a approach We the capital uncertainty prudent to of economy. the

post CETX regulatory incorporated CCAR goals. this Our severely stress adverse exceeded and minimums Ending submission well internal for the and ratios policy impact. scenarios internal baseline

XX CETX. a the point transition basis intend for utilize regulatory which We to benefit purposes, five-year capital provides to CECL

to serve challenging throughout time. this expect grow clients We capital our and

PPNR This slide XX. credit to strong the to among performance lower second capital stress and perspective conditions and Turning from peers slide shows best losses. a under resiliency due

DFAST company. from think XX reported The We credit combined XXXX losses loss results table was this respective use March its We that and year the Truist stress losses the their compares stress under the the BB&T profile XXXX at published peers reserves and last risk be and power as DFAST. to XXXX for earnings given similar will Fed of improved by SunTrust.

of ratio credit shows, As the reserves column Truist's of loss XX%. the to peer is right losses the on above XX% stress average

portfolio, on value unamortized which March in the Truist totaled However, loss stress billion SunTrust increased after XX, marks to coverage $X.X the XX%. on layering fair

of in This is believe profile of is by is also illustration that merger great a purchase at example It better companies risk insulated the another we and balance a marks defensive enhanced accounting both the how are sheet CECL together we and resulted Truist. of why reserves.

XX, slide needs. pandemic and to short-term cash to the acted out capital in to to borrowings response funding Turning increased we quickly meet term

such, As with ratios buffer asset of and our LCR liquidity XX.X%. strong, XXX% liquid average remain an of a

to access Our robust. funding secure sources remains

to see amid $XX.X total robust this growth with volatility, quality billion flight market a continue experienced to deposits recent have we increasing quarter. We and

from balances have our existing the PPP Fed Fed. We sufficient our to at liquidity loans fund

XX contractual inflows. cover months company outflows addition, no In to sufficient holding with of expected cash is

given going XXXX, uncertainty for guidance the our withdrawing are forward. We

guidance For XXXX. based we're the providing several first changes on quarter quarter, of linked-quarter categories the on second versus

earning average excess in of line and X% increase quarter the loans PPP basis, linked from the draws assets expect C&I to reflecting in on grow We program.

Total noted meaningful net liquidity revenue fee decline as build pressure, be in few earlier. lower percent a reflecting margin, by and down interest driven rates, taxable-equivalent linked-quarter, will income a

the non-interest plan. excluding amortization some COVID non-qualified good expense, spend adjusted merger, and adjustment the to third-party linked-quarter, flat savings optimization. to making expected generating progress, is expenses, for Core facilities and We're be the

goes, deep out the government of unfold. on Depending the economic length how the play influence downturn, effective scenarios the that how downturn will programs and

there charge-offs will allowance. add pressure, increase You be possibly can more the net so and year see throughout

striving achieve this positive environment. also despite leverage are challenging We to operating

for Now, Kelly let and update thoughts on an me and closing it back the to turn merger Q&A.

Kelly King

Thanks, Daryl.

terms in two keep accomplishments merged the in really companies December. these of So, and – mind, we in just

a accomplished importantly, cancel because complete So, most was end we to to Most through the had XX the very the that of we've but enterprise the had few meetings. lot. We or it townhall Truist reception to at were rolled out got able of We COVID-XX, good. we and a we defer extremely culture.

logo. the We out We which Truist We and did Foundation. purchase rolled and corporate introduced the in here our headquarters identity is Charlotte. Center, launched visual Truist of our Truist complete

we consolidating ahead begin some And to some estate that had could begin able cost we go go we real were and and to that get redundant ahead early portfolios saves.

in one care now, we if have of priorities. making COVID-XX. everything of you think focused it about taking So, priority in on all with the possibly can clients, us, laser two do in steps, going terms not in interaction our of sustain challenges terms major next We're really we safe only right sure of experience also teammates, that them their Number and is focusing doing on we're everybody's going of this well. economic helping safety, We're the terms to are along terms support with our through. but terrible

terms how really, willing there terms broadband in that of We're support trying help of things things doing to really some to all in types do to really of be that to communities communities, can very be creative are our struggling. we and we're and interesting invest and

priority, of the place a course, delays. our at integration of about track. terms integration where point, in of conversion and happen regard there. the what know It and the exactly But activities. any second hard still are planned really this We on to we length believe we the keeping the are So, in may It's depends health depth on we with good feel conversion to good and is crisis.

low a common We XXs, performance low would return XXs. in of adjusted the in we equity efficiency on terms still term. the In targets, in medium tangible believe our project the

confident already cost of billion in $X.X You terms see we're still we're saves. there. And remaining net our in pretty very much can

living depends pretty little then these and bit not-too-distant when that U, V, Exactly it's hit range. on, pretty of we'll obviously, of it's the quickly longer, recover environment achieve we kind just we're a take If in will we'll target type a medium that's in. a If it obvious. the and

we now you better did the look a I Regardless, of of top-tier absolute will be they benefits numbers merger than that to the performer, year that ago. are. will a we all the whatever say believe

believe value strong value if slide, look we you a at provide we Finally, our proposition really proposition.

building company, ever important to and We lives inspiring committed and today's are really than in more a world. communities. important, better purpose-driven That's

exceptional and diverse We franchise have an with markets. services products,

market fast-growing share and have vibrant and strong We Southeast, in MSAs presence. Mid-Atlantic the growing national a

have a business capital We comprehensive markets very mix and diverse insurance. in and banking,

together. resilient. importantly, stronger. very We're are we better more simply And We're

strategy talent, and terms in of best-in-breed have technology, processes. We

uniquely best-in-class We to the very are positioned efficiency in while returns, deliver and future. investing

net increases we businesses the of have to billion complementary revenue yield As are to $X.X going we synergies. These I clearly said, come. cost develop yet saves net as substantial

returns accretion, purchase advertising. making capital investments to marketing which Daryl our capabilities, we're and accounting you, and are Our buoyed and teammates, technology described by in has meaningful

and profile, merger. We liquidity the a very have with strong risk resilient capital enhanced by

We are very management. financial and prudent and disciplined in risk management

have metrics We culture, leading very a among the conservative highest-rated large credit banks. risk

We discussed. – have very benefits well together. separately test that We very, stress from and merger the we diversification arise

liquidity and the We have capital flight a very position enhanced even quality. strong and with to being

have we would call CECL marks reserves. I combined defensive and very purchase credit accounting strong a supported resilient it, balance with And by and, sheet the

and as strength our we forward the continue balance of move us as would can our Because far liquidity, into dividend we expect as to I see. our of sheet

January, to in now, us So, you year are but like liked days I if our best ago, a continue we you said believe us love should ahead.

back to over you. Ryan, turn it I'll

Ryan Richards

please how session? participate John, will Kelly. listeners at our can you, you Thank Q&A explain time, this the in

Operator

Certainly. [Operator Instructions].

first Please Saul of UBS. Martinez from our take question go will ahead. We

Saul Martinez

of with interplay the I for morning, moving little accounting and about a and bit to Good Hi. ask there. wanted lot a parts the credit the guys. outlook the

in and quarter. you your But, X us – of one, $X.X credit of much is January XX, day rates? how for – it the builds Daryl, additional just loan billion sorry, mark, tell true-up reserve $X.X slide first on billion mark how So, the credit liquidity and the is much go through you versus can

Daryl Bible

Yeah, Saul.

So, scenarios our one one. that we reserve, we first, day tell I our day came with. up estimate would scenario on And on came you, three with our stress XX% we had weighted up when we

from a year with So, that reserve the started strong we off perspective.

actually XX over overlay scenarios an on every use to provision through we ended we early moved that with. us CECL then, And quarter-end made went trying with into up our their we days, running to multiple and run. help changing scenarios this Moody's through as always we number we quarter, April, When different that came up scenarios few adjust

spend at the day, end go we this then, expert qualitatively And and $X qualitative effectiveness because they a you over had a when year, government's to the the weigh infusing really have limitations always Clarke of lot and to on judgment. time factors of have models for this time. back team and have Ellen what trillion And in to the using is. the

out all payment judgments And on might have be. need basically plans these You you how programs expert effective there. those the

that feel we lots there's up reserves good have of there. came we We that qualitative the adjustments very about So, with.

fair your $X.X mark, value and a as rate, it's far As and credit, billion. combination at of it's interest liquidity

Saul Martinez

much is that How industry? of Okay. versus credit

Daryl Bible

that, disclose Saul. didn't We

Saul Martinez

Okay.

Daryl Bible

to value a you of have value benefit because book when you all into you we at going the bit of day, lower earnings. apply all as it's a to lower – your going get reserves. the accrete when Saul, end for be little a used It's

liquidity. interest credit, So, It really matter. doesn't going whether or count, rate to it's all it's

Saul Martinez

that from asking a reserve that and guess does forward got for it of ACLs. builds BB&T back that in just the your worsen turns it. and hit that subsequent on book, the did on trying your accounting? But the sort bit I and you $X.X mention the benefit need have larger embedded SunTrust of portion more work more. your does billion going in to does you'll credit of how that a sort accounting the true-up on than purchase re-estimate And marks of legacy down worsen losses what's out does environment understand is your the a about will over that as you there going play economic credit Okay, your a you have if And think I'm for Obviously, out? and risk what forward, that, adjustments book, then, mark, credit you'll be – to terms Do how than of insufficient forward, then there reserve outlook, if that credit on loss-absorbing come builds. get to is mark credit possibility whatever to going get But I'm though, double is even to equity I is, capacity – the and time? a only a accretion? do base that's little

Daryl Bible

value prepared up It how in end reserves, I take If the what into going plans, come really happens remarks. is on when said less. government you how What So, is. a to it providing going economy? value, it my really so lower then really deep you with be the you Is up mark. stressful? more your and book be It CECL going Clarke? to effective is to don't fair in account the they're depend

Clarke Starnes III

then and GDP we the And was Saul, for those period. probability to weighted after scenarios did in We through spike we that Great the sharp experienced described two-year a lingering unemployment of initial our unemployment similar and contraction, high-single reversion we very what basically Recession. mean assumed Daryl digit supportable assume estimate. reasonable our all a

different overlay. And into on and We portfolios. so, of that redefault and at sensitivity our then And the we we historical rates all get, the around mods qualitative of to stress bit deferrals. a the analysis Daryl's baked good looked point, projected different

have provide If would we know. reserved. things So, like worse, then as then projected, best to more. is estimate we're holds well up if we it feel the today the deteriorate we Obviously, we

Saul Martinez

that loan greater the and on the recalibrate billion. estimates those on than are it And mark, losses how you but does understand work? [indiscernible], $X.X I reserves, you're now the unamortized CECL assuming

Daryl Bible

you based XX/X. true-up have upon had So, to any at miscalculations you goodwill, your a but that's year

feel of good. all finalized the pretty we marks. So, We

amortization mentioned on what the intangible. amount is new think I the I

Actually, So, a we quarter. up was in it the this trued all on have table deck. that

of So, can't all any We of perspective. kind that that. and really that readjust from finalized go back

Saul Martinez

Okay.

there's no reserve, CECL not there's a associated loss top incremental with – risk I So, that guess? on of there's that the there really an

Daryl Bible

Saul. That's Yeah, correct. that's right,

Saul Martinez

you. a thank right. Okay, All lot. Thanks

Daryl Bible

You're welcome.

Operator

will go We of Please ahead. RBC. Cassidy Gerard next now from question take our

open. is line Your

Gerard Cassidy

Thank morning, you. Kelly. morning, Good Daryl. Good

Daryl Bible

Gerard. Hi,

Gerard Cassidy

Can you stronger like – it came share in with quarter. us purchase your looked accounting this accretion

Your tangible to give maybe book us obviously, jumped that That value, accretion. prior out stronger expectation? up you probably I share. this attributed a guess, Can accounting worked versus $XX purchase to, was some color on how quarter

we so, loans and off, consumer side. And than on paying and the was due it corporate in came on mainly higher the to expected both side

that was a estimates little we So, own above bit had. it our

a On year. the but you it. say throughout that would basically count It's on count can't wouldn't possible, you basis, that go-forward I over-estimating on

on a never look you consistent basis But core points would to were basis. on in basis to off what's XX take reported you pay quarter-on-quarter on the accretion. if have basis you it probably margin, people at versus closer When averages loans, So, XX know happen basically we their points a to the I think payoffs. difference. all going

Gerard Cassidy

can are than – to don't – for? And good. as share that the stress CECL which very appreciate aren't Very higher? – was what not test. and slide it's reserves economic different maybe aren't it the simple Why are yours just you Why the and putting assumptions even peers, in the is on Again, relative match they us why then, at and losses? test But the life-of-loan And highest insightful assumptions? stress you everyone, stress XX, with we're your the looking testing losses. together, simple, economic the are accounting,

Daryl Bible

Yeah.

testing. a breathing living, difference stress process. Stress there's CECL a So, between is dynamic, testing and

So, have to a for runoff grow you basically sheet depending with volumes happens. and CECL runoff is new static project assumptions. balance on basically whatever

there. differences there's So,

reserves it in our we Jason that the on we added value, think add chart The versus that XXXX, I Goldberg. you little just that XX%. the credit fair group. market that to company's that is that combined basically I as we shows a above XXXX table, we XX%. the together have of at a in And losses credit, give Jason from for That's bit that. peer give from But lot it's put at clearly on plagiarized

that to at note, you basis though, we look basically is, our is XXXX from yet combined XX%. reason run on number actually the I'm Fed. One the stress company severely don't XXXX, in That basically you have our this The weeks on have a stress will thing to few if And CCAR that that results was results company were results later But at telling we look quarter. come the the XX%. Fed submitted what what we you do if a we run ago. were at adverse,

been less basis. together, shows really So, we we I company Ellen that, XXXX combined are on that and have indication think company company than the as a a put would Clarke riskier a good have derisked a and just we

you in then then and $XX.X adverse. losses our at you're of the – our of our mark, severely So, we fair add billion reserves came up at XX%, value with if XXXX in XX%

Gerard Cassidy

Very helpful. Thank you.

Daryl Bible

you. Thank

Operator

We'll question Graseck from Betsy Stanley. ahead. now go Morgan of Please take our next

open. Your is line

Betsy Graseck

the Thanks number for Two the morning. deferrals. call One, you gave customers questions. of have Hi, us the requesting color. been good and that

it's think consumer percentage wholesale on the I the XXX,XXX us give on and the side represent? each that side. sense of a balances you to those as XX,XXX Can

Clarke Starnes III

Clarke. Betsy, this is Yeah.

it's and side, $X for for consumer Service Others. the That's billion. On about both onUps

about $X it's balance billion sheet. So, for

So, roughly X%.

side, commercial X% or the billion X%. or it's roughly about so, $XX On

have our far been the accounts would our are that all current re-agings with example. with, even of majority note of I again, in subprime to start So, auto an as

unusual very think is So, environment. this again, I a

or lot lost a just their normal, have job that So, to different they're that maybe in are that little most but of current people are all – you they're with. have maybe worried worried have start have and than not,

Betsy Graseck

the that you do those expect on And just to numbers your we're CECL high go? how through, forward in look talking

Daryl Bible

know, on we to though, That's really really know effective more three when Great There and to are it's than what the It a impact. X don't adequately how said $X had said earlier, we depends what factors all We have government's than know. programs we over know and now, going Recession. we is The feel stimulus of reserved times done. don't the I in we what more those trillion be. are going Betsy. to going lot from that they are things how Right

So, lot that of you to play a out. really need let

now, of forbearance out. that's has All right the occurring to play been all that

what not really comfortable happens of We some may make we just we forward. today, and clients reserved And we'll the it. where see feel are as move

Kelly King

that the in in keep unemployment of unemployment had in substantially, in home there Protection people are whole their in those because Program will Betsy, income cases, an before. Payroll income. they terms insurance too effects their many normalized as have was cases, understand more take I increase keep the people than furloughed, that insurance the mind it, So, most And of

is it's But that run, will programs the So, good providing short be a in a terms Obviously, the hard pretty a that be government the it short say to exactly huge then factor. today, short-term stimulus, of buffer. has and run, this extended done in would negative the if in impact. provide government continued actually don't job

Betsy Graseck

that on – of hard moving today aside just to much going I'm to want feel timeframe, put understand versus billion you it's you everything just can then, put $X.X on. to you know given stage? I expenses, billion, $X.X the don't how redundancies you maybe control this touch at because it's that's Okay. the wondering on And the that do you

Kelly King

achievable. it Well, over still all term, is, of

the to the as environment able that it had today. some as as there may issues material today, any our right, more centers. studying working we're this deferred But have not in the people is connectivity, You're what things cetera, Because of away progression will they do may be the drives the anticipated. office, terms slow progression discovered our be not quickly we're down daily. of some from people et though in because of integration. are we And of that And of dramatically call integration of

Daryl Bible

examples. of couple a you give I'll

So, right of to on on probably of XX% our it, target. way we're now, working third-party still teams XX% are our but the vendor,

And year. locked run to of over annual couple the that. next $XXX close rate we'll we $XXX this So, million of have million years, save have in about already

really real So, that's on good our progress progressing making corporate portfolio. We're estate well.

million now, over Right known have of $XX XX,XXX savings square in what we're there executing feet. We about have of we on.

now, said have at the much saves. look through that you really of more after home, going for to people we're that with we it's evaluate But all what an opportunity be working If impacts could right done. at and

million we So, million – three five next might have $XX down $XX to over to go years. we the

that. know don't just You

opportunity. that So, be even could a bigger

Betsy. So a few examples, those are just

Betsy Graseck

Thanks.

Operator

Securities. from I ahead. Please now next go of Mike will Fargo our Wells take Mayo question

is line open. Your

Mike Mayo

your Hi. Daryl, for pretty your quarter few tough Kelly, maybe questions with year, talked you A operating about guidance. thought guidance. I about this forward seems second which more said, results positive the potential

vendor, that As guidance, – it was you just and real you part all guidance. other estate, that the said these mentioned expenses of relates only COVID effect other quarter slight the that second in the things extra the

given Thank some second I exactly higher stand. quarter. just Some know other building that, banks you've reserve but said, numbers on expect in you. where you the have much

Daryl Bible

Mike. Yeah,

So, I challenge second. from it's to be say first linked would from quarter to a going definitely

woods. achieve depends recovers. have is out year. the all on it's this to to may we not continue the V, may. operating going on that sharp shot at positive We're we have. still leverage. We the within do can best And parameters up we we economy quickly can. how But It a it. best and We a it our giving execute we that if It do And the not we of will the aren't

Mike Mayo

And since question, some your have for quarter, guess markets have to maybe larger some look, banks own gotten Moody's. use in the second the of quarter, saying, first guess flexibility capital the you build forecast, worse.' I use I the conditions group the 'hey, you said other the are banks. end reserve like

your the purchase bank marks, expect test, That's if more reserve accounting Given the I from, of said what, number. you're even your stress with XXXX since XX% you got big the correct? all which decline first building? And a reserved though in that quarter, you end would submitted is

Daryl Bible

Yes.

You're right on that.

other as went early a – running reserve. we scenarios use in that our have we far But we run. we Moody's As couple also into scenarios and April

quarter XXst. because didn't little we're we the off closed this in cycle. the cut it later on just a later We So,

at first So, the least information. we went week of that April through with

Clarke Starnes III

we're certainly those provide but we actually we think to economy underperforms based we scenarios, if what Yeah. And know have again, reserved, on today, watching the well we're would but it. more,

Mike Mayo

Okay.

expense much so, far? some said And you so might timeframes savings the how of slip. achieved you And have of the

mentioned some You areas that have. you'll still

You the your in time. same happening have a at pandemic biggest merger with the history

you're on what table to to just So, later. waiting managing expect it. we get tough till should it's out opposed maybe as sounds through the now a like But It situation.

Daryl Bible

Yeah.

been just got other forward forward laptops pulled from slippage expense the there buying and the in happened quarter that, have bit in we some and a of That our March, year. COVID, first expenses elevated. our were some with little planning has are savings pulled on We bunch So, we a specific later some that of what with and equipment. savings, in into Wi-Fis

get to $X.X So, a expenses perspective. that our try And from bit the by XX% of little of our end elevated the was to to the billion year. goal down

are so that. into the But have be quarter we have be We to honest with of the sharp and as XX% doesn't a easier a buffer on we end track getting year doing recovery. quarter trying get that. to some any get you. were we of next this We shot still at to this have our far at ahead It if

Mike Mayo

All right, you. thank

Daryl Bible

Yeah.

Operator

ISI. question next Evercore of our Pancari John take will from We

John Pancari

morning. Good

have indicate for at-risk you credit affected you I exposures, qualitative overlays the XX, industries. billion, the slide the $XX.X that slide on Regarding on exposures that know the

against magnitude that them? loan the loss and reserve So, maybe little the can – portfolios the more of amount and on marks maybe color give loan you against bit those on us a

Kelly King

you detail. the of the looked that, risk request. level every segments, each like that each I detailed those And or for and disclosed have of things haven't bit to downside. would of sensitivity one analysis, and deferral of modification done We tell at we've those, good we this grade a notching

would tell add higher just than models will so, what additional of that. on the considerably you to And top overlays other that used we've have segments, driven I in. the They're

John Pancari

you then, indicated business. that offset more play detail Can trends you want your All see in do that you the could give expect the know plays pricing And us Okay. there quarter second could Just in you about how dampen in of industry? COVID an from And terms perhaps to that the insurance outlook I bit Thanks. the little that organic any see out? how business, in better right. out. is think how a you

Kelly King

will Chris that. cover

Christopher Henson

you Chris, is question. Thank the for This John. Yeah.

quarter will about second this your what be strong the slow result And business quarter be a of is That's lost, that business, and year. could up X%. to production. we off, lost expect – units First have will as that there a would COVID to pricing. seasonally you're right, new the of down creating in pickup potential people, exposure declining economic slow point, you, But be really

into Recession, in [indiscernible] very When the years two we of backdrop went actually it's being the history. largest Great market in go loss of insurance went with market. this into soft back on a XXXX XXXX the we the – We one and a strong

have to rates example, – up X% So, right back. you're that's a going we've have for are just we're it for one, go good this kind to in If backdrop X.X%, to if the And range got into quarter, to of up X.X%. now.

that you to of these struggling rates, P&C their If investment lower are on underwriters throw going be interest on top returns.

environment. likely on the continue pressure So, they upward rate keep to will

right. exactly think I is So, your intuition

of in we We expect reduction. the momentum do new year. pricing balance business the see tough But for

kind looking balance growth. organic – for maybe of had flat we of past range forward, looking might of have at looking the this Kind it's the in quarter, X% X.X% So, more year. to we the been like

John Pancari

Okay. Thanks, Chris.

Operator

go question Please We ahead. Usdin will now take of our Jefferies. next Ken from

Your line is open.

Kenneth Usdin

back on we step could revenue Thank you. Good morning. side. the Daryl, just out, step wondering if

just second about, moving just of down And many versus involved, us There's be the You can you was fees? talked helpful. us directionally that and but understand understand bit just on percent. you parts a can moving just help would revenues following fees, that quarter few of parts help if part direction talked Thank you. fee NII so about the

Daryl Bible

Yeah.

that insurance change That won't what I would high charges, clients the from – help we Chris is Just this our X% talked Kelly seasonally That's stress. of time you tell up. Ken, quarter. on about, Service second programs during strong and to have perspective. level, cashback. place in some Insurance commented

are banking relief requests are more waiving meet coming people services. NSF and granting can for People in ATM we're on We that. their now, so fees, getting we're

there be that potentially that. line happens might rates that Depending from spreads, and $XX down chance Beau's CVA, I credit has the on touch are item volumes is a what what So, do would the while million, recovering a say, charges on lower, perspective. interest area, overall service overall with of

be the is We And We mortgage then, to in the volumes, but know The factor try don't will strong. good it that, mortgage, in offset the have on impact embedded impact there. the servicing. on of already. full on some will did that's MSR valuation forbearance estimates if

adjust accordingly. did we for So, that

decent probably will mortgage guess. be quarter So, a would my have

Kenneth Usdin

your understand, And on going balance help also just growing. us NII can looks keep side, you the sheet to like it's

can of NII growing and us a here. between talking understand about core peers from difference stated – the you other lot mentioned But NIM. You help are

you help extra guys an in the there parse have You us too? just parts moving that. the purchase Any accounting factor can Thanks. as out way

Daryl Bible

accounting first. is foresee Yeah. I versus quarter unless second than foresee purchase being I stronger don't think, we really – don't NII positive

margin, XXX disclosed, are you when Core to we our gradual. reports earnings at back – and sensitivity, looked our probably you back to on January our disclosures disclosures basis our down if points go in need that what, we show

X.XX% points throughout in X.XX%. point at or a So, basis And would January, that down XXX XX that's the assuming the months. go negative it was that

a like, say, that's shock to, of you equivalent XX. If

in experienced was So, of what XXX. we a March shock

weird with second. LIBOR. a And Now, bit had a you LIBOR, about we'll on little going talk in

XXX. you a shock of had So,

what multiply perspective. rough impact X.XX% take if on second for the be NII by change would what estimate, that would So, might be, it probably and the that from be quarter you X, our

Then we liquidity. have lot a built of

perspective. stress period, Now, we meet a a to were from we our built we and in want sure because need clients' liquidity from we deposit can both a make funding

points XX So, to carrying anywhere now is basis right at Fed basis from points. the what the carrying XX cost of we're

the our balances right Friday on $XXX total If billion. you April look or now, balance sheet on through our and – XX, at sheet, March balance are

$XXX now are deposits billion. Our

one I it time the where $X in one we in day, in come to So, was up think that all week, deposits had we checks government period. that stimulus started Wednesday, last went billion

It's funding of loans. PPP to is started week. going It books. following going on $XXX Our going billion the this week. start last go have week We'll on and the probably to

we're So, higher much to going definitely have assets. earning

look costs you our we When Great an points. at then, at we costs, costs get you March, interest-bearing you I far XX other deposit note thing and at deposit basis basis look basis go deposit that back XX And the and basis. down on the down basis XX points. were at The our about XX if down were is how interest-bearing Recession points would back points, already to got to look

quarters couple push XXs where I get but sure to to think we we're don't points the we're second quarter, are. if the So, down for to to going over rates XX basis they continue get these in the in going next stay rates as

that our of will get have we margin a will is because But think the core once manage that pretty can stress we I we've be that down there to down, be feel reverse we So, with, things liquidity. and over, lot margin but liquidity the back. of got easily pressure

helpful. that's hopefully, So,

Kenneth Usdin

LIBOR Very is if you How talk for that Daryl. Thanks talk color. over the seeing are a time? about. you all could was And you wondering look to I much We're going about LIBOR. normalize so, point as out down

Daryl Bible

Yeah.

So, at X.XX%, at It's it one-month peaked on now LIBOR. April X.XX%. X

to $XXX We net right have one-month assets tied billion LIBOR LIBOR about now.

that that there. migrates you in So, that will put down, saw kind of effect rate that sensitivity that as interest of full

us coming yet. all allow going hurt market some money side. still equivalent, but down has come It make of It kind faster together. the will to room more, at come too deposit side, we're the look well. that you up when deposit but And down costs LIBOR will on also to our down asset there to will it aren't push as our down that as We is

Kenneth Usdin

very Got it. much. Thanks

Daryl Bible

welcome. You're

Operator

go ahead. from We Bank. will our Deutsche take question next Please Matt now of O'Connor

open. Your line is

Matthew O'Connor

morning. Good

risk guess, the guys integration side, gets competitors a don't addressed we recovery your lot less virus, You to the a partly if generous. get have delayed losing because the very the feared, risk partly here. some is I being action staff, than for of probably you're on staff flip some people and customers the of that that the maybe doing V-shaped

maybe how your So, direction. Kelly, the in engagement staff and cultures, you of of you same keep the them about Bill, of the could just talk, kind both

you do and doing Thanks. the were base. the halls doing of aspects can't your business before. You softer some from that it kind those talk the town But of customer about base of – employee

Kelly King

I'll and why add you a maybe ahead comment at end? go don't Bill, the

William Rogers

Okay. Thanks, Matt.

I survey good already a from in of point out, proxy. And engagement survey was an were you actually just did as environment, retention coming our levels showed think that incredible engagement this the perspective. we a high numbers teammates. in from teammate the And

if In the stressful conditions. many people been teamwork been under not The are because years, accelerated has operating months, ways, spectacular. by integration has cultural

I the wearing that. headed echo think, jersey all objective. because same you would towards one's a No Kelly, they're

And this point been of have just that you process. of through think advantageous I elements are are the personally accurately, that proud as go I've we really, So, this really teammates out there done. work our

got everybody's forward the well really a something and The town values, same They're and underway mission same we been lean language playbook. good and the were halls operating there, because all and of rollout purpose, that from on. the speaking has catalyst to

Kelly King

just a part like care first, is but job can't you additional our really We good said really that A this. get teammates. big your our care clients And of taking teammates. for point. earlier, really in doing culture our of of I take matters time out just always. It point culture a will without one clients come I matters your

in people we things unique terms fully bonuses lines. and pension is plan, pay Truist on match. So, then, X%-on-X% like for $X,XXX XXX(k) for premium a And do the of paid having

teammates really those of all our things, appreciate. So,

feel can Those of times, if our difficult take and feel take short-term going then for of And that, in be memories sacrifice so, can teammates, they so terms care going safe clients and during to even our there's they they we're here decades. some help will see secure. secure, to them care of profitability. and safe We're

we feel culture. so, our And very good about

As Bill as said, strong accelerating is it steel. and it is

Matthew O'Connor

just then, question I Daryl. for And Helpful. have a

those for the loans, Can above you'll on about do about, same as how implementing you loans attempt I And much rate, floors. some come just floors for You the to the thing talk renewal, loans? new talk assume, you are? up

Daryl Bible

Yeah.

week XX So, from, floors think, putting perspective. think anywhere David that to points LIBOR ago, basis two points he's from reported, XX I range basis a or I the in that a

putting over the that are think those perspective. in spread the not That's floors he's from LIBOR I that it. rate, the

Matthew O'Connor

Thank you. Okay.

Daryl Bible

Welcome.

Operator

will of Bank we Erika next Najarian take from go our Please America. question ahead. And of

Erika Najarian

rate if your follow-up in estate. cost And one clients? annual you $XXX your achievable I'm in $XXX from Hi, how and third-party Daryl, interruption annualized is loan question. saves good morning. without that your savings had the much answer of real employees Of I noted, interpreting, vendors, million million from $XX savings to of that Betsy's question, of to pandemic-related million just corporate run support

million nothing So, $XXX it or would at sounds supporting $XXX to with the clients. employees of million that do have least like

Kelly King

add? So, can right. Erika, I comment. one You're just Daryl,

effect reductions vendor our terms vendor we've COVID – are in the substantial seen of of think, more come. contracts, expenses I are run are of count, in contracts already some expenses being of of rate There can LIFO some bifurcated. You independent and to independent that kind and of

big the charges to to charge bonus, teammate from there's regard forward, we $X,XXX with marginally not one-time teammates, point but the the are incremental. had With regard this ongoing, a

the But And we've people mind, working depends. in of in terms technology offsite of on well, in our today, had we've the offsite. – forever. it really conversion, area, working keep the functioning thousands very already impact are people And

more not doing it. is So, idea. just a this people It's new

self-evident long remotely, a see continue which their their their there change we that and not as and they they're it's scheduling. scoping programming integration conversion to to so, regard and able dramatic now that And as will to mapping do can, with be our

Daryl Bible

Yeah.

are on the right are our paying to For the premium second line. that teammates we front quarter, now a Erika,

can see Depending how we work that personnel elevated quickly to will with away. fade going from charge you're adjust on at basically an So, in home, that.

call We are of more do the more work also on can actively centers more their laptops getting people home. at in, so

equipment from that that subside get will we've So, perspective. well that that as of as in more accelerated we

third execute savings. As play far as you that's as party implementation and the when and of they the get facilities, out,

this not may you as much it out continue fourth as than early we to see would throughout from goes you So, at move, but year, what higher on the that annualized year, quarter impact will that and a it build, point this to perspective. as start the will see have such

of although the to conversions. of So, things, is good some lot third-party savings tied a

some broker Or some in up be coming wealth card the there's conversions areas. just transparent, to big conversions big and up, dealer coming

to conversion he's like, So, Joe's his still planning in earlier world, on in stay dealer. an right now, with track broker

of at bit to a first of end out, be be supposed will there scheduled for point of that XXXX. if on plays I little If things think in that miss come XXXX. XXXX. the at the but at that's he in early stays some But going that that the of end then He's more time. in track, those to part XXXX, might wasn't

So…

Erika Najarian

you. Thank

Operator

of now Piper Stephen will We our next take go question Please from Scouten Sandler. ahead.

is line open. Your

Stephen Scouten

Hey. Good Thanks. guys. morning,

impact. to way for I of communities, I'd your is appreciated want community in important. one Being the in all you leading affected the say leadership say thank guys are First, you and

for So, that. you thank guys

need kind and far buybacks. about had it to target in pertains X.X% I in phased the back it out. – know you've you, probably number, to CECL it's to ways was how I'm that as longer curious, line? ask impact XX% capital are And to that this regain wanted if your the X.X% buybacks about you I versus of to how about you fully I get think the you talked and term thinking CETX and But way XX% down where the just pertains how kind environment, of to you think that

Kelly King

So, thinking buybacks nobody's today. about

position even year capital – strong still We still quarter. this a adjustments are made in capital. before accreting this billion $X are very and We

there this project that. We would if will time. we difference. up long moving at unless in makes be dramatic a We losses, steadily understand loan all increases a not that it's U, are Again, which

knew that about So, intermediate XX%. said we COVID, know that. But it goodness, said thank to of a the did target that said because about. good we're We've was doing uncertainties we our uncertainties didn't merger. we have in we that We because position. for regard know were with didn't we term of the prepare we about of did course. really And We

integration shareholders. opportunities and health reaffirm, go that as we go then improve, would surely surely those merger terms as the on XX% uncertainties Now, capital then subside crisis are will the available forward economy but circumstances, said, for depend and opportunities away I in the there and of have below level. our the will we we It existing will have

Daryl Bible

loans The we're percent zero rate. remember other is book the risk that minor putting have on a that point PPP

cost put $XX going us billion So, not any round. weighted on capital. to from we That's risk first the

really basis though XXX at ourselves, to earning points leverage the balance to from not going number, fund from because basically out PPP. a at trading it basis even we're we're asset And going points Fed to just cost XX then, it's us

So, from a capital perspective, those should be fine.

Stephen Scouten

I'm kind been in industry around then, And Helpful. others of seeing underwriting in categories, further forbearance – But you thing, underwriting tightened tighten lending. are And kind concentrations? the guys requests some you that, on any fairly Thank the mortgage, terms your HELOCs, conservative other have guys. you industry of other with you, of within have what curious, standards? standards one always seen you've resi we've Great. of

Clarke Starnes III

we've asset risk is made all as have and our I say Across yes reviews underwriting This and Clarke. appropriate. we question. changes that extensive classes, would done pretty to acceptance

would You do. us to expect

and So, uncertainty. any the to We've right I careful about they think on we are more hard end, lending in today. worked be non-essential be would what very given now, conservative place the call we also

cetera sides hospitality, side, as right in from the . then, things on mortgage now. And the we lot and the far modification commercial we've et out, I'd as been that consumer laid say, those industries side, all So, had like a predominantly the requests, the it's stressed on

Kelly King

recall, our some you had standards if pre-COVID. even adjustments made regard with And to underwriting we

already potential were we We anticipating already. slowdown. made adjustments So, had a

Stephen Scouten

very much. guys, you, Thank

Operator

of Marinac from ahead. go Please We will take Scott. our Janney next Christopher question Montgomery

open. is line Your

Christopher Marinac

we there on Thanks. Good average the PPP an morning. Daryl, should that loans is expect? life

Daryl Bible

pure be a it really we don't Sure. right much estimate a to guess If out how would number, gave good now. have you is Chris, I there. a be on forgiveness going

guess Whether now. know. making goes everybody's really out don't is, it – the I loans So, my

So, all all tsunami. to that. you've has forgivenesses got It will probably a some SBA big take Remember, the these process XX to time process in days.

the linger my of do are and will some loans portions that. So, see stay into quickly on forgivenesses there how five guess years. some months it and will is four, But before be might that they the three, then, all happening, full we'll two

It the and X.X% two we're take about years accrete turn plays will at forgiveness, point that I off it discount. earnings booking in average them discount discount, The you looked period. pays and that at books, will time we'll time. accrete it all our when a the to time We that then, out in that last just And at for that in. put and we'll over on

Christopher Marinac

Got it. much, Thanks sense. makes the information all guys, That today. very for

Operator

will we And from final ahead. Research. of our question McDonald take John Autonomous go Please

is line Your open.

John McDonald

color Two today? quick any allocated how as follow-ups. give commercial and reserve you guys. consumer Hey, the on Wondering is buckets of if could between

Daryl Bible

thing, was have the to back for can of was on and between XX% on QX, and that, – say XX% to about related that the to John. look guess and we increase reserve, John, – get about that I noteworthy see provision consumer. for I split commercial would one you just increase I

itself, allowance you we in the get the actual On split can that.

John McDonald

as a comes have example so kind it down $XXX you Like, a that marks And frequently guys – of it this how a idea you're marked – helping smaller you up kind give from losses, questions there how mechanic us if the loan, the the is from could just marking you're that to $XX writing amount? question. opposed of does with charge-off? smaller was it a absorb down a Okay. then, That's down So, work $XXX, absorb of on it's loan, credit of helps? Is if how wandering write-off dumbed just and the that, a it marks?

Daryl Bible

Yeah, that's right. exactly

lower. So, basically, your is book value

So, the against you apply your balance. reserve lower

you as coming think in. a other earnings I earnings an So, little provision line bit. or of can fall be helps perspective. it But to it that for its earnings are Those bottom the provide used from to could

John McDonald

the Meaning PAA?

Daryl Bible

exactly. Yeah,

your question to – I think first

Unidentified Company Speaker

it. got I've

Daryl Bible

Yeah. is reserves $X.XXX it? your to question, are for and QX wholesale got You've about the John, consumer billion the $X.XXX back billion. first

John McDonald

Okay. the the comes about of absorbency, Daryl, PAA. when in think you it loss form

kind think PAA how you absorbing on That's cushion. the extra losses, of an got you more you've So, of side? cushion it have

Daryl Bible

were you play definitely exposures cut significant test new that of later really But also, out bank have diversified. cushion We any quarter. together really of the should Fed have the don't more we how think stress in we we our perspective. the from the any come that And this out diversification when coming we I just more more and when came from – came together, much Yeah. together, as portfolios absorption, because,

capital loss should, number that stress buffer. Our to PPNR, well hope XXX be capital and a going the have points really under We is very a hopefully, basis really strong we're ratio. resilient strong

Kelly King

half of of reduced that, denominator. remember all in of portfolios, exposure And the in the was our doubling because the essentially,

kind automatic this material So, diversification it was environment. of an that's in

John McDonald

Okay. guys. Thanks,

Operator

Difficulty]. further no have [Technical We

Ryan Richards

for today. Thanks joining Hope very everybody us everyone a good and Okay. has thank please much. day, And stay well.

Operator

participation. concludes call. This your today's you Thank for

may disconnect. You now

Truist Financial (TFC) 20 Apr 202020 Q1 Earnings call transcript