Item 1. FINANCIAL STATEMENTS

391K characters. Original on sec.gov · Markdown

Item 1. FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEETS

TRUIST FINANCIAL CORPORATION AND SUBSIDIARIES



Unaudited (Dollars in millions, except per share data, shares in thousands)	Sep 30, 2024		Dec 31, 2023
Assets
Cash and due from banks	$	5,229	$	5,000
Interest-bearing deposits with banks	34,411		25,230
Securities borrowed or purchased under agreements to resell	2,973		2,378
Trading assets at fair value	5,209		4,332
AFS securities at fair value	64,111		67,366
HTM securities (fair value of $43,229 and $44,630, respectively)	51,495		54,107
LHFS (including $1,028 and $852 at fair value, respectively)	1,278		1,280
Loans and leases (including $13 and $15 at fair value, respectively)	303,084		312,061
ALLL	(4,842)		(4,798)
Loans and leases, net of ALLL	298,242		307,263
Premises and equipment	3,251		3,298
Goodwill	17,125		17,156
CDI and other intangible assets	1,635		1,909
Loan servicing rights at fair value	3,499		3,378
Other assets (including $1,624 and $1,311 at fair value, respectively)	34,976		34,997
Assets of discontinued operations	—		7,655
Total assets	$	523,434	$	535,349
Liabilities
Noninterest-bearing deposits	$	105,984	$	111,624
Interest-bearing deposits (including $99 and $— at fair value, respectively)	281,794		284,241
Short-term borrowings (including $2,545 and $1,625 at fair value, respectively)	20,859		24,828
Long-term debt	36,770		38,918
Other liabilities (including $1,912 and $2,597 at fair value, respectively)	12,331		12,946
Liabilities of discontinued operations	—		3,539
Total liabilities	457,738		476,096
Shareholders’ Equity
Preferred stock	6,673		6,673
Common stock, $5 par value	6,638		6,669
Additional paid-in capital	36,020		36,177
Retained earnings	23,248		22,088
AOCI, net of deferred income taxes	(6,883)		(12,506)
Noncontrolling interests	—		152
Total shareholders’ equity	65,696		59,253
Total liabilities and shareholders’ equity	$	523,434	$	535,349
Common shares outstanding	1,327,521		1,333,743
Common shares authorized	2,000,000		2,000,000
Preferred shares outstanding	223		223
Preferred shares authorized	5,000		5,000

The accompanying notes are an integral part of these consolidated financial statements.

4 Truist Financial Corporation

CONSOLIDATED STATEMENTS OF INCOME

TRUIST FINANCIAL CORPORATION AND SUBSIDIARIES



Unaudited (Dollars in millions, except per share data, shares in thousands)		Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Interest Income
Interest and fees on loans and leases		$	4,852		$	4,976		$	14,596		$	14,547
Interest on securities		869			763			2,512			2,264
Interest on other earning assets		631			488			1,779			1,375
Total interest income		6,352			6,227			18,887			18,186
Interest Expense
Interest on deposits		2,014			1,858			5,994			4,510
Interest on long-term debt		454			491			1,382			1,739
Interest on other borrowings		282			343			1,010			932
Total interest expense		2,750			2,692			8,386			7,181
Net Interest Income		3,602			3,535			10,501			11,005
Provision for credit losses		448			497			1,399			1,537
Net Interest Income After Provision for Credit Losses		3,154			3,038			9,102			9,468
Noninterest Income
Wealth management income		350			343			1,067			1,012
Investment banking and trading income		332			185			941			657
Card and payment related fees		222			238			676			704
Service charges on deposits		221			154			678			644
Mortgage banking income		106			102			315			343
Lending related fees		88			102			273			294
Operating lease income		49			63			158			194


Securities gains (losses)		—			—			(6,650)			—
Other income		115			147			259			287
Total noninterest income		1,483			1,334			(2,283)			4,135
Noninterest Expense
Personnel expense		1,628			1,669			4,919			5,042
Professional fees and outside processing		336			289			922			887
Software expense		222			222			664			645
Net occupancy expense		157			164			477			499
Amortization of intangibles		84			98			261			297
Equipment expense		84			89			261			278
Marketing and customer development		75			70			194			207
Operating lease depreciation		34			43			108			133

Regulatory costs		51			77			288			225
Restructuring charges		25			61			109			165


Other expense		231			278			771			743
Total noninterest expense		2,927			3,060			8,974			9,121
Earnings
Income (loss) before income taxes		1,710			1,312			(2,155)			4,482
Provision (benefit) for income taxes		271			203			(821)			794
Net income (loss) from continuing operations		1,439			1,109			(1,334)			3,688
Net income from discontinued operations		3			74			4,898			355
Net income		1,442			1,183			3,564			4,043

Noncontrolling interests from discontinued operations		—			6			22			44

Preferred stock dividends and other		106			106			289			284
Net income available to common shareholders		$	1,336		$	1,071		$	3,253		$	3,715
Basic earnings from continuing operations		$	1.00		$	0.75		$	(1.21)		$	2.56

Basic EPS		1.00			0.80			2.44			2.79
Diluted earnings from continuing operations		0.99			0.75			(1.21)			2.54

Diluted EPS		0.99			0.80			2.44			2.77
Basic weighted average shares outstanding		1,334,212			1,333,522			1,335,812			1,331,377
Diluted weighted average shares outstanding		1,349,129			1,340,574			1,335,812			1,339,041

The accompanying notes are an integral part of these consolidated financial statements.

Truist Financial Corporation 5

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

TRUIST FINANCIAL CORPORATION AND SUBSIDIARIES



Unaudited (Dollars in millions)	Three Months Ended September 30,						Nine Months Ended September 30,
2024			2023			2024			2023
Net income	$	1,442		$	1,183		$	3,564		$	4,043
OCI, net of tax:
Net change in net pension and postretirement costs	(14)			23			21			17
Net change in cash flow hedges	508			(255)			280			(447)
Net change in AFS securities	1,067			(2,015)			5,155			(1,712)
Net change in HTM securities	59			63			167			183
Other, net	1			(1)			—			1
Total OCI, net of tax	1,621			(2,185)			5,623			(1,958)
Total comprehensive income (loss)	$	3,063		$	(1,002)		$	9,187		$	2,085
Income Tax Effect of Items Included in OCI:
Net change in net pension and postretirement costs	$	(4)		$	—		$	7		$	—
Net change in cash flow hedges	157			(79)			87			(138)
Net change in AFS securities	330			(618)			1,592			(543)
Net change in HTM securities	18			19			51			51

Total income taxes related to OCI	$	501		$	(678)		$	1,737		$	(630)

The accompanying notes are an integral part of these consolidated financial statements.

6 Truist Financial Corporation

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

TRUIST FINANCIAL CORPORATION AND SUBSIDIARIES




Unaudited (Dollars in millions, shares in thousands)	Shares of Common Stock	Preferred Stock		Common Stock		Additional Paid-In Capital		Retained Earnings		AOCI		Noncontrolling Interests		Total Shareholders’ Equity
Balance, July 1, 2023	1,331,976	$	6,673	$	6,660	$	35,990	$	27,577	$	(13,374)	$	155	$	63,681
Net income	—	—		—		—		1,177		—		6		1,183
OCI	—	—		—		—		—		(2,185)		—		(2,185)


Issued in connection with equity awards, net	1,692	—		8		43		(4)		—		—		47



Cash dividends declared on common stock	—	—		—		—		(693)		—		—		(693)
Cash dividends declared on preferred stock	—	—		—		—		(106)		—		—		(106)
Equity-based compensation expense	—	—		—		78		—		—		—		78

Other, net	—	—		—		3		(7)		—		6		2
Balance, September 30, 2023	1,333,668	$	6,673	$	6,668	$	36,114	$	27,944	$	(15,559)	$	167	$	62,007
Balance, July 1, 2024	1,338,223	$	6,673	$	6,691	$	36,364	$	22,603	$	(8,504)	$	—	$	63,827
Net income	—	—		—		—		1,442		—		—		1,442
OCI	—	—		—		—		—		1,621		—		1,621

Issued in connection with equity awards, net	983	—		5		29		(3)		—		—		31

Repurchase of common stock, including excise tax	(11,685)	—		(58)		(445)		—		—		—		(503)

Cash dividends declared on common stock	—	—		—		—		(695)		—		—		(695)
Cash dividends declared on preferred stock	—	—		—		—		(106)		—		—		(106)
Equity-based compensation expense	—	—		—		71		—		—		—		71
Sale of remaining stake in TIH	—	—		—		—		—		—		7		7
Other, net	—	—		—		1		7		—		(7)		1
Balance, September 30, 2024	1,327,521	$	6,673	$	6,638	$	36,020	$	23,248	$	(6,883)	$	—	$	65,696
















Balance, January 1, 2023	1,326,829	$	6,673	$	6,634	$	34,544	$	26,264	$	(13,601)	$	23	$	60,537
Net income	—	—		—		—		3,999		—		44		4,043
OCI	—	—		—		—		—		(1,958)		—		(1,958)
Received in connection with TIH minority stake sale, net	—	—		—		1,317		—		—		96		1,413

Issued in connection with equity awards, net	6,839	—		34		(1)		(7)		—		—		26



Cash dividends declared on common stock	—	—		—		—		(2,077)		—		—		(2,077)
Cash dividends declared on preferred stock	—	—		—		—		(284)		—		—		(284)
Equity-based compensation expense	—	—		—		251		—		—		—		251

Other, net	—	—		—		3		49		—		4		56
Balance, September 30, 2023	1,333,668	$	6,673	$	6,668	$	36,114	$	27,944	$	(15,559)	$	167	$	62,007
Balance, January 1, 2024	1,333,743	$	6,673	$	6,669	$	36,177	$	22,088	$	(12,506)	$	152	$	59,253
Net income	—	—		—		—		3,542		—		22		3,564
OCI	—	—		—		—		—		5,623		—		5,623

Issued in connection with equity awards, net	5,463	—		27		(26)		(8)		—		—		(7)

Repurchase of common stock, including excise tax	(11,685)	—		(58)		(445)		—		—		—		(503)

Cash dividends declared on common stock	—	—		—		—		(2,085)		—		—		(2,085)
Cash dividends declared on preferred stock	—	—		—		—		(289)		—		—		(289)
Equity-based compensation expense	—	—		—		237		—		—		—		237

Sale of remaining stake in TIH	—	—		—		—		—		—		(190)		(190)
Other, net	—	—		—		77		—		—		16		93
Balance, September 30, 2024	1,327,521	$	6,673	$	6,638	$	36,020	$	23,248	$	(6,883)	$	—	$	65,696

The accompanying notes are an integral part of these consolidated financial statements.

Truist Financial Corporation 7

CONSOLIDATED STATEMENTS OF CASH FLOWS**(1)**

TRUIST FINANCIAL CORPORATION AND SUBSIDIARIES



Unaudited (Dollars in millions)		Nine Months Ended September 30,
	2024			2023
Cash Flows From Operating Activities:
Net income		$	3,564		$	4,043
Adjustments to reconcile net income to net cash from operating activities:
Provision for credit losses		1,399			1,537

Depreciation		460			522

Amortization of intangibles		282			397


Securities (gains) losses		6,650			—
Gain on sale of TIH, net of tax		(4,830)			—
Net change in operating assets and liabilities:
LHFS		(176)			(204)

Pension asset		(144)			(1,425)
Derivative assets and liabilities		(1,463)			852
Trading assets		(877)			521
Other assets and other liabilities		(4,110)			75

Other, net		634			(63)
Net cash from operating activities		1,389			6,255
Cash Flows From Investing Activities:
Proceeds from sales of AFS securities		27,611			15
Proceeds from maturities, calls and paydowns of AFS securities		11,131			6,340
Purchases of AFS securities		(35,323)			(2,261)
Proceeds from maturities, calls and paydowns of HTM securities		2,844			3,023

Originations and purchases of loans and leases, net of sales and principal collected		7,829			9,332
Net cash received (paid) for FHLB stock		418			(5)
Net cash received (paid) for securities borrowed or purchased under agreements to resell		(595)			1,163

Net cash received (paid) for asset acquisitions, business combinations, and divestitures		12,164			(15)

Other, net		479			273
Net cash from investing activities		26,558			17,865
Cash Flows From Financing Activities:
Net change in deposits		(9,629)			(13,471)
Net change in short-term borrowings		(3,973)			47
Proceeds from issuance of long-term debt		14,375			48,172
Repayment of long-term debt		(16,748)			(49,609)
Repurchase of common stock		(500)			—


Cash dividends paid on common stock		(2,085)			(2,077)
Cash dividends paid on preferred stock		(289)			(284)
Net cash received (paid) for hedge unwinds		(80)			(424)
Net cash from TIH minority stake sale		—			1,922
Other, net		(22)			15
Net cash from financing activities		(18,951)			(15,709)
Net Change in Cash and Cash Equivalents		8,996			8,411
Cash and Cash Equivalents of Continuing and Discontinued Operations, January 1		30,644			21,421
Cash and Cash Equivalents of Continuing and Discontinued Operations, September 30		$	39,640		$	29,832
Supplemental Disclosure of Cash Flow Information:
Net cash paid (received) during the period for:
Interest expense		$	8,664		$	6,430
Income taxes		762			785

(1)Cash flows of discontinued operations are reflected within operating, investing, and financing activities in the Consolidated Statements of Cash Flows. The cash balances of these operations were reported as assets of discontinued operations on the Consolidated Balance Sheets prior to the sale of TIH. Refer to “Note 2. Discontinued Operations” for additional information related to discontinued operations.

The accompanying notes are an integral part of these consolidated financial statements.

8 Truist Financial Corporation

NOTE 1. Basis of Presentation

General

See the Glossary of Defined Terms at the beginning of this Report for terms used herein. These consolidated financial statements and notes are presented in accordance with the instructions for Form 10-Q, and, therefore, do not include all information and notes necessary for a complete presentation of financial position, results of operations, and cash flow activity required in accordance with GAAP. In the opinion of management, all normal recurring adjustments necessary for a fair statement of the consolidated financial position and consolidated results of operations have been made. The year-end consolidated balance sheet data was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. The information contained in the financial statements and notes included in the Annual Report on Form 10-K for the year ended December 31, 2023 should be referred to in connection with these unaudited interim consolidated financial statements. The Company updated its accounting policies in connection with recently adopted accounting standards, as applicable, which are described in this footnote. There were no other significant changes to the Company’s accounting policies from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2023 that could have a material effect on the Company’s financial statements.

Discontinued Operations

The Company classifies assets and liabilities as held for sale when management, having the authority to approve the action, commits to a plan to sell the disposal group, the sale is probable to occur within one year, and the disposal group is available for immediate sale in its present condition. The Company also considers whether an active program to locate a buyer has been initiated, whether the disposal group is marketed actively for sale at a price that is reasonable in relation to its current fair value, and whether actions required to complete the plan indicate it is unlikely significant changes to the plan will be made or the plan will be withdrawn. An asset or business that meets the criteria for held for sale classification is reported as discontinued operations when the disposal represents a strategic shift that has had or will have a major effect on the Company’s operating results.

Assets and liabilities of discontinued operations are presented separately in the Consolidated Balance Sheets for prior periods commencing in the period in which the asset or business meets all of the held for sale criteria described above. Net income from discontinued operations, net of tax, is separately reported in the Consolidated Statements of Income for current and prior periods commencing in the period in which the asset or business meets all of the held for sale criteria described above, including any gain or loss recognized on the sale or adjustment of the carrying amount to fair value less cost to sell.

Certain activity of TIH impacting the Company's footnote disclosures has been removed or revised. The footnote disclosures included herein are presented on a continuing operations basis, unless otherwise noted.

Refer to “Note 2. Discontinued Operations” for additional information.

Segment Realignment

Effective January 1, 2024, several business activities were realigned reflecting updates to the Company’s operating structure. First, the CB&W segment was renamed CSBB and the C&CB segment was renamed WB. Second, the Wealth business was realigned into the WB segment from the CSBB segment, representing a separate reporting unit in that segment. Third, the small business banking client segmentation was realigned into the CSBB segment from the WB segment. Further, TIH was the principal legal entity of the IH segment. As the operations of TIH were included in discontinued operations prior to the sale of TIH, the Company no longer presents the IH segment as one of its reportable segments. The segment disclosures have been revised to reflect the new structure. Refer to “Note 18. Operating Segments” for additional information.

Reclassifications

In addition to the reclassifications discussed above in the Consolidated Balance Sheets, Consolidated Statements of Income, and certain footnotes for discontinued operations and the segment realignment, as applicable, certain other amounts reported in prior periods’ consolidated financial statements have been reclassified to conform to the current presentation.

In the third quarter of 2024, the Company’s corporate expense allocation methodology was enhanced to allocate certain overhead or functional expenses based on actual OT&C noninterest expense performance. Prior period results have been revised for the CSBB, WB, and OT&C segments to conform to the current allocation methodology.

Truist Financial Corporation 9

As a result of the methodology change, CSBB noninterest expense increased $43 million and $195 million, for the three and nine months ended September 30, 2023, respectively, with an off-setting decrease in OT&C noninterest expense. For the same reason, WB noninterest expense increased $76 million and $234 million for the three and nine months ended September 30, 2023, respectively, with an off-setting decrease in OT&C noninterest expense.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change include the determination of the ACL; determination of fair value for securities, MSRs, LHFS, trading loans, and derivative assets and liabilities; goodwill and other intangible assets; income taxes; and pension and postretirement benefit obligations.

Changes in Accounting Principles and Effects of New Accounting Pronouncements


Standard / Adoption Date	Description	Effects on the Financial Statements




Standards Not Yet Adopted
Improvements to Reportable Segment Disclosures December 31, 2024	Improves reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses.	Truist is actively engaged in establishing enhanced disclosures of significant segment expenses consistent with the requirements of this standard. This standard relates to footnote disclosures only.
Improvements to Income Tax Disclosures December 31, 2025	Improves the transparency of income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures.	Truist is evaluating the impact of this standard on its disclosures. This standard relates to footnote disclosures only.

10 Truist Financial Corporation

NOTE 2. Discontinued Operations

On February 20, 2024, the Company entered into an agreement to sell the remaining stake of the common equity in TIH to an investor group led by Stone Point Capital LLC and Clayton, Dubilier & Rice for a purchase price that implied an enterprise value for TIH of $15.5 billion. The divestiture of TIH represented a strategic shift that had a major effect on our operations and financial results. The Company reclassified all of the assets and liabilities of TIH to discontinued operations in connection with the announcement of the disposition of the business. As such, financial information attributed to TIH has been recast to reflect discontinued operations for the periods presented herein. The following footnotes reflect impacts of discontinued operations: “Note 1. Basis of Presentation,” “Note 2. Discontinued Operations,” “Note 6. Goodwill and Other Intangible Assets,” “Note 8. Other Assets and Liabilities,” “Note 12. Income Taxes,” “Note 13. Benefit Plans,” “Note 17. Computation of EPS,” and “Note 18. Operating Segments.”

The following is a summary of the assets and liabilities of discontinued operations:


(Dollars in millions)	Dec 31, 2023
Assets of discontinued operations:
Cash and due from banks	$	72
Interest-bearing deposits with banks	342
Premises and equipment	72
Goodwill	3,745
CDI and other intangible assets	1,251
Other assets	2,173
Total assets of discontinued operations	$	7,655
Liabilities of discontinued operations:
Other liabilities	$	3,539
Total liabilities of discontinued operations	$	3,539

The following presents operating results of TIH classified as discontinued operations:


(Dollars in millions)	Three Months Ended September 30,						Nine Months Ended September 30,
2024			2023			2024			2023
Interest Income
Interest on other earning assets	$	—		$	26		$	31		$	47
Total interest income	—			26			31			47
Noninterest income
Insurance income	—			795			1,319			2,548
Other income	—			5			9			13
Total noninterest income	—			800			1,328			2,561
Expenses
Personnel expense	—			531			885			1,595
Professional fees and outside processing	10			28			95			96
Software expense	—			16			25			44
Net occupancy expense	—			16			20			44
Amortization of intangibles	—			32			21			100
Equipment expense	—			8			11			21
Marketing and customer development	—			8			15			28

Restructuring charges	—			14			82			27
Other expense	5			57			89			166
Total noninterest expense	15			710			1,243			2,121
Earnings
Gain on sale of TIH	36			—			6,939			—
Income before income taxes from discontinued operations	21			116			7,055			487
Provision for income taxes	18			42			2,157			132
Net income from discontinued operations	3			74			4,898			355
Noncontrolling interests	—			6			22			44
Net income from discontinued operations attributable to controlling interest	$	3		$	68		$	4,876		$	311

Truist Financial Corporation 11

The components of net cash provided by operating, investing, and financing activities of discontinued operations included in the Consolidated Statements of Cash Flows are as follows:


(Dollars in millions)	Nine Months Ended September 30,
2024			2023
Net cash from operating activities	$	64		$	524
Net cash from investing activities	12,099			(33)
Net cash from financing activities	(41)			(478)

On May 6, 2024, the Company completed the sale. The transaction improved Truist’s relative capital position while allowing Truist to maintain strategic flexibility. Upon closing, the transaction resulted in the deconsolidation of the TIH subsidiary from Truist. The following is a summary of the transaction, including post-closing and tax impact adjustments:


(Dollars in millions)	May 6, 2024
Cash received	$	12,605
Assets of discontinued operations:
Cash and due from banks	93
Interest-bearing deposits with banks	1,952
Premises and equipment	58
Goodwill	3,743
CDI and other intangible assets	1,227
Other assets	2,873
Total assets of discontinued operations	9,946
Liabilities of discontinued operations:
Other liabilities	4,090
Total liabilities of discontinued operations	4,090
Net assets of discontinued operations	5,856
Noncontrolling interest	190

Pre-tax gain	6,939
Current and deferred tax impact	(2,109)
After-tax gain	$	4,830

In connection with the sale of TIH, the Company has entered into various agreements with entities controlled by the buyers and TIH, including a transition services agreement and several commercial agreements, ranging from one to seven years. The transition services agreement includes the following support services: information technology, finance and accounting, human resources, marketing and communications, procurement, and real estate. The Company is compensated for such services on a monthly basis. The commercial agreements represent arrangements for both the Company and TIH to continue engaging in certain business activities after the completion of the sale. Such activities include referral services and certain insurance brokerage and administration services. In addition, TIH retained its depository relationship with Truist Bank after completion of the sale. As of May 6, 2024, TIH held $1.5 billion of deposits at Truist Bank, which are no longer eliminated as a result of the deconsolidation of the TIH subsidiary from Truist effective with completion of the sale. Prior to the sale of TIH, such deposits were not presented in assets of discontinued operations as they were eliminated upon consolidation.

12 Truist Financial Corporation

NOTE 3. Securities Financing Activities

Securities purchased under agreements to resell are primarily collateralized by U.S. government or agency securities and are carried at the amounts at which the securities will be subsequently sold, plus accrued interest. Securities borrowed are primarily collateralized by corporate securities. The Company borrows securities and purchases securities under agreements to resell as part of its securities financing activities. On the acquisition date of these securities, the Company and the related counterparty agree on the amount of collateral required to secure the principal amount loaned under these arrangements. The Company monitors collateral values daily and calls for additional collateral to be provided as warranted under the respective agreements. The following table presents securities borrowed or purchased under agreements to resell:


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
Securities purchased under agreements to resell	$	1,014	$	1,168
Securities borrowed	1,959		1,210
Total securities borrowed or purchased under agreements to resell	$	2,973	$	2,378

Fair value of collateral permitted to be resold or repledged	$	2,398	$	2,175
Fair value of securities repledged	—		12

For securities sold under agreements to repurchase, the Company would be obligated to provide additional collateral in the event of a significant decline in fair value of the collateral pledged. This risk is managed by monitoring the liquidity and credit quality of the collateral, as well as the maturity profile of the transactions. Refer to “Note 14. Commitments and Contingencies” for additional information related to pledged securities. The following table presents the Company’s related activity, by collateral type and remaining contractual maturity:


	September 30, 2024						December 31, 2023
(Dollars in millions)	Overnight and Continuous		Up to 30 days		Total			Overnight and Continuous		Up to 30 days		Total
U.S. Treasury	$	—	$	750	$	750		$	12	$	—	$	12
State and Municipal	300		100		400			415		—		415

Agency MBS – residential	—		2,200		2,200			—		1,500		1,500
Corporate and other debt securities	450		155		605			420		80		500
Total securities sold under agreements to repurchase	$	750	$	3,205	$	3,955		$	847	$	1,580	$	2,427

There were no securities financing transactions subject to legally enforceable master netting arrangements that were eligible for balance sheet netting for the periods presented.

Truist Financial Corporation 13

NOTE 4. Investment Securities

The following tables summarize the Company’s AFS and HTM securities:


September 30, 2024 (Dollars in millions)	Amortized Cost		Gross Unrealized				Net unrealized gains (losses)		Fair Value
	Gains		Losses
AFS securities:
U.S. Treasury	$	13,328	$	166	$	(19)	$	147	$	13,475
GSE	387		5		(27)		(22)		365
Agency MBS – residential	51,452		218		(4,204)		(3,986)		47,466
Agency MBS – commercial	2,917		3		(549)		(546)		2,371
States and political subdivisions	416		15		(13)		2		418

Other	16		—		—		—		16
Total AFS securities, excluding portfolio level basis adjustments	68,516		407		(4,812)		(4,405)		64,111
Portfolio level basis adjustments(1)	331						(331)		—
Total AFS securities	$	68,847	$	407	$	(4,812)	$	(4,736)	$	64,111
HTM securities:


Agency MBS – residential	$	51,495	$	—	$	(8,266)	$	(8,266)	$	43,229





December 31, 2023 (Dollars in millions)	Amortized Cost		Gross Unrealized				Net unrealized gains (losses)		Fair Value
	Gains		Losses
AFS securities:
U.S. Treasury	$	10,511	$	2	$	(472)	$	(470)	$	10,041
GSE	393		3		(34)		(31)		362
Agency MBS – residential	60,989		—		(9,700)		(9,700)		51,289
Agency MBS – commercial	2,817		—		(569)		(569)		2,248
States and political subdivisions	421		17		(13)		4		425
Non-agency MBS	3,698		—		(717)		(717)		2,981
Other	20		—		—		—		20


Total AFS securities	$	78,849	$	22	$	(11,505)	$	(11,483)	$	67,366
HTM securities:


Agency MBS – residential	$	54,107	$	—	$	(9,477)	$	(9,477)	$	44,630

(1)Represents fair value hedge basis adjustments related to active portfolio layer method hedges, which are not allocated to individual securities. For additional information, refer to “Note 16. Derivative Financial Instruments.”

The amortized cost and estimated fair value of certain MBS securities issued by FNMA and FHLMC that exceeded 10% of shareholders’ equity are shown in the table below:


	September 30, 2024
(Dollars in millions)	Amortized Cost		Fair Value
FNMA	$	27,782	$	24,075
FHLMC	27,600		23,800

The amortized cost and estimated fair value of the securities portfolio by contractual maturity are shown in the following table. The expected life of MBS may be shorter than the contractual maturities because borrowers have the right to prepay their obligations with or without penalties.


	Amortized Cost										Fair Value
September 30, 2024 (Dollars in millions)	Due in one year or less		Due after one year through five years		Due after five years through ten years		Due after ten years		Total		Due in one year or less		Due after one year through five years		Due after five years through ten years		Due after ten years		Total
AFS securities:
U.S. Treasury	$	4,019	$	9,272	$	8	$	29	$	13,328	$	4,034	$	9,408	$	8	$	25	$	13,475
GSE	2		5		12		368		387		2		5		12		346		365
Agency MBS – residential	—		97		407		50,948		51,452		—		95		392		46,979		47,466
Agency MBS – commercial	—		9		71		2,837		2,917		—		9		68		2,294		2,371
States and political subdivisions	65		68		147		136		416		65		71		150		132		418

Other	—		7		9		—		16		—		7		9		—		16
Total AFS securities	$	4,086	$	9,458	$	654	$	54,318	$	68,516	$	4,101	$	9,595	$	639	$	49,776	$	64,111
HTM securities:


Agency MBS – residential	$	—	$	—	$	—	$	51,495	$	51,495	$	—	$	—	$	—	$	43,229	$	43,229

14 Truist Financial Corporation

The following tables present the fair values and gross unrealized losses of investments based on the length of time that individual securities have been in a continuous unrealized loss position:


	Less than 12 months				12 months or more				Total
September 30, 2024 (Dollars in millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
AFS securities:
U.S. Treasury	$	1,337	$	(2)	$	586	$	(17)	$	1,923	$	(19)
GSE	29		—		245		(27)		274		(27)
Agency MBS – residential	565		(2)		28,997		(4,202)		29,562		(4,204)
Agency MBS – commercial	12		—		2,224		(549)		2,236		(549)
States and political subdivisions	35		—		240		(13)		275		(13)

Other	—		—		7		—		7		—
Total	$	1,978	$	(4)	$	32,299	$	(4,808)	$	34,277	$	(4,812)
HTM securities:


Agency MBS – residential	$	—	$	—	$	43,229	$	(8,266)	$	43,229	$	(8,266)








	Less than 12 months				12 months or more				Total
December 31, 2023 (Dollars in millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses

AFS securities:
U.S. Treasury	$	356	$	(2)	$	8,806	$	(470)	$	9,162	$	(472)
GSE	16		—		255		(34)		271		(34)
Agency MBS – residential	258		(4)		51,006		(9,696)		51,264		(9,700)
Agency MBS – commercial	61		(2)		2,185		(567)		2,246		(569)
States and political subdivisions	35		—		243		(13)		278		(13)
Non-agency MBS	—		—		2,981		(717)		2,981		(717)
Other	—		—		20		—		20		—
Total	$	726	$	(8)	$	65,496	$	(11,497)	$	66,222	$	(11,505)
HTM securities:


Agency MBS – residential	$	—	$	—	$	44,630	$	(9,477)	$	44,630	$	(9,477)

At September 30, 2024 and December 31, 2023, no ACL was established for AFS or HTM securities. Substantially all of the unrealized losses on the securities portfolio were the result of changes in market interest rates compared to the date the securities were acquired rather than the credit quality of the issuers or underlying loans. The Company does not expect to incur any credit losses on investment securities.

The following table presents gross securities gains and losses recognized in earnings:


(Dollars in millions)		Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023

Gross realized losses(1)		$	—		$	—		$	(6,650)		$	—

(1)Includes $485 million pre-tax gain on terminated hedges for the nine months ended September 30, 2024.

Following the sale of TIH, Truist executed a strategic balance sheet repositioning of a portion of its AFS investment securities portfolio by selling $27.7 billion of lower-yielding investment securities, resulting in an after-tax loss of $5.1 billion in the second quarter of 2024. The investment securities that were sold had a book value of $34.4 billion including the impact of hedges. Truist invested approximately $18.7 billion of the sale proceeds in shorter duration, higher-yielding investment securities.

Truist Financial Corporation 15

NOTE 5. Loans and ACL

The following tables present loans and leases HFI by aging category. Government guaranteed loans are not placed on nonperforming status regardless of delinquency because collection of principal and interest is reasonably assured.


	Accruing
September 30, 2024 (Dollars in millions)	Current		30-89 Days Past Due		90 Days Or More Past Due(1)		Nonperforming		Total
Commercial:
Commercial and industrial	$	153,229	$	116	$	5	$	575	$	153,925
CRE	20,600		10		—		302		20,912
Commercial construction	7,975		4		—		1		7,980

Consumer:
Residential mortgage	52,703		671		433		156		53,963
Home equity	9,492		63		7		118		9,680
Indirect auto	21,660		596		—		252		22,508
Other consumer	28,964		233		22		63		29,282

Credit card	4,707		76		51		—		4,834

Total	$	299,330	$	1,769	$	518	$	1,467	$	303,084
(1)Includes government guaranteed loans of $394 million in the residential mortgage portfolio.

	Accruing
December 31, 2023 (Dollars in millions)	Current		30-89 Days Past Due		90 Days Or More Past Due(1)		Nonperforming		Total
Commercial:
Commercial and industrial	$	160,081	$	230	$	7	$	470	$	160,788
CRE	22,281		5		—		284		22,570
Commercial construction	6,658		—		1		24		6,683

Consumer:
Residential mortgage	54,261		639		439		153		55,492
Home equity	9,850		70		11		122		10,053
Indirect auto	21,788		669		2		268		22,727
Other consumer	28,296		271		21		59		28,647

Credit card	4,961		87		53		—		5,101

Total	$	308,176	$	1,971	$	534	$	1,380	$	312,061
(1)Includes government guaranteed loans of $418 million in the residential mortgage portfolio.

16 Truist Financial Corporation

The following tables present the amortized cost basis of loans by origination year and credit quality indicator:


September 30, 2024 (Dollars in millions)	Amortized Cost Basis by Origination Year																	Revolving Credit		Loans Converted to Term		Other(1)
2024			2023			2022			2021			2020			Prior					Total
Commercial:
Commercial and industrial:
Pass	$	17,066		$	16,486		$	22,880		$	12,482		$	6,976		$	13,909	$	56,781	$	—	$	(202)	$	146,378
Special mention	251			432			401			381			87			268		958		—		—		2,778
Substandard	338			863			707			383			167			486		1,250		—		—		4,194
Nonperforming	11			128			61			31			20			75		249		—		—		575
Total	17,666			17,909			24,049			13,277			7,250			14,738		59,238		—		(202)		153,925
Gross charge-offs	15			94			56			9			5			26		71		—		—		276
CRE:
Pass	1,416			2,933			3,970			2,086			1,654			4,029		1,599		—		(63)		17,624
Special mention	68			85			615			260			8			241		300		—		—		1,577
Substandard	175			326			148			216			155			389		—		—		—		1,409
Nonperforming	6			82			82			1			42			89		—		—		—		302
Total	1,665			3,426			4,815			2,563			1,859			4,748		1,899		—		(63)		20,912
Gross charge-offs	14			31			91			—			26			103		—		—		—		265
Commercial construction:
Pass	579			1,530			1,777			814			44			169		1,109		—		—		6,022
Special mention	3			68			870			184			68			—		72		—		—		1,265
Substandard	8			65			336			179			35			—		69		—		—		692
Nonperforming	—			—			1			—			—			—		—		—		—		1
Total	590			1,663			2,984			1,177			147			169		1,250		—		—		7,980








Consumer:
Residential mortgage:

Current	1,638			2,838			12,839			15,705			5,402			14,281		—		—		—		52,703
30 - 89 days past due	4			16			72			70			46			463		—		—		—		671
90 days or more past due	2			40			42			27			28			294		—		—		—		433
Nonperforming	—			4			14			22			6			110		—		—		—		156
Total	1,644			2,898			12,967			15,824			5,482			15,148		—		—		—		53,963
Gross charge-offs	—			—			—			—			—			2		—		—		—		2
Home equity:

Current	—			—			—			—			—			—		6,085		3,407		—		9,492
30 - 89 days past due	—			—			—			—			—			—		44		19		—		63
90 days or more past due	—			—			—			—			—			—		5		2		—		7
Nonperforming	—			—			—			—			—			—		38		80		—		118
Total	—			—			—			—			—			—		6,172		3,508		—		9,680
Gross charge-offs	—			—			—			—			—			—		7		—		—		7
Indirect auto:

Current	6,494			3,444			5,914			3,235			1,552			1,020		—		—		1		21,660
30 - 89 days past due	45			110			176			114			62			89		—		—		—		596

Nonperforming	8			44			81			52			29			38		—		—		—		252
Total	6,547			3,598			6,171			3,401			1,643			1,147		—		—		1		22,508
Gross charge-offs	8			83			164			75			36			67		—		—		—		433
Other consumer:

Current	7,946			7,029			5,702			2,626			1,346			1,656		2,631		25		3		28,964
30 - 89 days past due	37			69			66			26			13			15		6		1		—		233
90 days or more past due	3			11			6			—			—			—		2		—		—		22
Nonperforming	2			14			18			12			5			12		—		—		—		63
Total	7,988			7,123			5,792			2,664			1,364			1,683		2,639		26		3		29,282
Gross charge-offs	54			150			126			56			28			23		21		—		—		458







Credit card:
Current	—			—			—			—			—			—		4,690		17		—		4,707
30 - 89 days past due	—			—			—			—			—			—		74		2		—		76
90 days or more past due	—			—			—			—			—			—		50		1		—		51

Total	—			—			—			—			—			—		4,814		20		—		4,834
Gross charge-offs	—			—			—			—			—			—		215		7		—		222
Total	$	36,100		$	36,617		$	56,778		$	38,906		$	17,745		$	37,633	$	76,012	$	3,554	$	(261)	$	303,084
Gross charge-offs	$	91		$	358		$	437		$	140		$	95		$	221	$	314	$	7	$	—	$	1,663

Truist Financial Corporation 17


December 31, 2023 (Dollars in millions)	Amortized Cost Basis by Origination Year																	Revolving Credit		Loans Converted to Term		Other(1)
2023			2022			2021			2020			2019			Prior					Total
Commercial:
Commercial and industrial:
Pass	$	26,836		$	29,877		$	15,683		$	8,436		$	5,918		$	11,539	$	55,026	$	—	$	(211)	$	153,104
Special mention	688			623			557			152			37			197		1,003		—		—		3,257
Substandard	754			628			428			290			289			367		1,201		—		—		3,957
Nonperforming	36			116			99			12			42			31		134		—		—		470
Total	28,314			31,244			16,767			8,890			6,286			12,134		57,364		—		(211)		160,788
Gross charge-offs	20			72			126			21			5			35		111		—		—		390
CRE:
Pass	3,760			4,931			2,651			1,903			2,813			2,666		1,221		—		(70)		19,875
Special mention	185			315			140			79			203			37		—		—		—		959
Substandard	259			350			190			65			243			289		56		—		—		1,452
Nonperforming	2			52			28			15			174			13		—		—		—		284
Total	4,206			5,648			3,009			2,062			3,433			3,005		1,277		—		(70)		22,570
Gross charge-offs	—			58			10			20			29			47		2		—		—		166
Commercial construction:
Pass	1,029			2,196			1,370			287			89			125		840		—		—		5,936
Special mention	3			218			208			—			—			—		1		—		—		430
Substandard	24			48			27			174			—			—		20		—		—		293
Nonperforming	—			23			—			—			1			—		—		—		—		24
Total	1,056			2,485			1,605			461			90			125		861		—		—		6,683
Gross charge-offs	—			5			—			—			—			—		—		—		—		5






Consumer:
Residential mortgage:

Current	2,846			13,481			16,509			5,738			2,822			12,865		—		—		—		54,261
30 - 89 days past due	10			52			43			38			40			456		—		—		—		639
90 or more days past due	7			22			25			31			28			326		—		—		—		439
Nonperforming	—			7			13			7			13			113		—		—		—		153
Total	2,863			13,562			16,590			5,814			2,903			13,760		—		—		—		55,492
Gross charge-offs	—			—			2			1			1			6		—		—		—		10
Home equity:

Current	—			—			—			—			—			—		6,175		3,675		—		9,850
30 - 89 days past due	—			—			—			—			—			—		47		23		—		70
90 days or more past due	—			—			—			—			—			—		7		4		—		11
Nonperforming	—			—			—			—			—			—		42		80		—		122
Total	—			—			—			—			—			—		6,271		3,782		—		10,053
Gross charge-offs	—			—			—			—			—			—		10		—		—		10
Indirect auto:

Current	4,611			8,049			4,689			2,479			1,330			639		—		—		(9)		21,788
30 - 89 days past due	83			213			150			86			71			66		—		—		—		669
90 days or more past due	—			1			1			—			—			—		—		—		—		2
Nonperforming	20			85			63			39			33			28		—		—		—		268
Total	4,714			8,348			4,903			2,604			1,434			733		—		—		(9)		22,727
Gross charge-offs	25			202			118			58			59			69		—		—		—		531
Other consumer:

Current	9,903			7,676			3,715			1,914			1,049			1,207		2,816		13		3		28,296
30 - 89 days past due	86			85			41			23			16			12		7		1		—		271
90 days or more past due	9			8			1			1			—			—		2		—		—		21
Nonperforming	6			14			14			8			6			10		—		1		—		59
Total	10,004			7,783			3,771			1,946			1,071			1,229		2,825		15		3		28,647
Gross charge-offs	97			166			93			50			34			14		23		—		—		477
Student:(2)





Gross charge-offs	—			—			—			—			—			108		—		—		—		108
Credit card:
Current	—			—			—			—			—			—		4,942		19		—		4,961
30 - 89 days past due	—			—			—			—			—			—		84		3		—		87
90 days or more past due	—			—			—			—			—			—		51		2		—		53

Total	—			—			—			—			—			—		5,077		24		—		5,101
Gross charge-offs	—			—			—			—			—			—		220		3		—		223
Total	$	51,157		$	69,070		$	46,645		$	21,777		$	15,217		$	30,986	$	73,675	$	3,821	$	(287)	$	312,061
Gross charge-offs	$	142		$	503		$	349		$	150		$	128		$	279	$	366	$	3	$	—	$	1,920

(1)Includes certain deferred fees and costs and other adjustments.

(2)Truist sold its student loan portfolio at the end of the second quarter of 2023. Charge-offs include $98 million related to the sale.

18 Truist Financial Corporation

ACL

The following tables present activity in the ACL:








(Dollars in millions)	Balance at Jul 1, 2023		Charge-Offs		Recoveries		Provision (Benefit)		Other(1)		Balance at Sep 30, 2023
Commercial:
Commercial and industrial	$	1,536	$	(98)	$	28	$	(114)	$	(1)	$	1,351
CRE	402		(77)		2		278		—		605
Commercial construction	109		—		—		56		—		165

Consumer:
Residential mortgage	320		(8)		1		(12)		—		301
Home equity	85		(4)		7		(2)		—		86
Indirect auto	981		(135)		25		74		—		945
Other Consumer	808		(120)		20		158		—		866

Credit card	365		(55)		9		55		—		374

ALLL	4,606		(497)		92		493		(1)		4,693
RUFC	273		—		—		4		—		277
ACL	$	4,879	$	(497)	$	92	$	497	$	(1)	$	4,970

(Dollars in millions)	Balance at Jul 1, 2024		Charge-Offs		Recoveries		Provision (Benefit)		Other(1)		Balance at Sep 30, 2024
Commercial:
Commercial and industrial	$	1,338	$	(96)	$	26	$	49	$	—	$	1,317
CRE	661		(65)		5		55		—		656
Commercial construction	206		—		1		9		—		216

Consumer:
Residential mortgage	205		—		1		(10)		—		196
Home equity	88		(1)		4		(4)		—		87
Indirect auto	945		(143)		38		122		—		962
Other consumer	958		(152)		26		154		—		986

Credit card	407		(71)		9		77		—		422

ALLL	4,808		(528)		110		452		—		4,842
RUFC	302		—		—		(4)		—		298
ACL	$	5,110	$	(528)	$	110	$	448	$	—	$	5,140



















(Dollars in millions)	Balance at Jan 1, 2023		Charge-Offs		Recoveries		Provision (Benefit)		Other(1)		Balance at Sep 30, 2023
Commercial:
Commercial and industrial	$	1,409	$	(280)	$	54	$	170	$	(2)	$	1,351
CRE	224		(118)		3		496		—		605
Commercial construction	46		—		1		118		—		165

Consumer:
Residential mortgage	399		(10)		5		(12)		(81)		301
Home equity	90		(8)		18		(14)		—		86
Indirect auto	981		(377)		82		246		13		945
Other consumer	770		(329)		57		369		(1)		866
Student(2)	98		(108)		—		10		—		—
Credit card	360		(159)		27		149		(3)		374

ALLL	4,377		(1,389)		247		1,532		(74)		4,693
RUFC	272		—		—		5		—		277
ACL	$	4,649	$	(1,389)	$	247	$	1,537	$	(74)	$	4,970

Truist Financial Corporation 19


(Dollars in millions)	Balance at Jan 1, 2024		Charge-Offs		Recoveries		Provision (Benefit)		Other(1)		Balance at Sep 30, 2024
Commercial:
Commercial and industrial	$	1,404	$	(276)	$	72	$	117	$	—	$	1,317
CRE	616		(265)		17		288		—		656
Commercial construction	174		—		2		40		—		216

Consumer:
Residential mortgage	298		(2)		4		(104)		—		196
Home equity	89		(7)		13		(8)		—		87
Indirect auto	942		(433)		96		357		—		962
Other consumer	890		(458)		82		472		—		986

Credit card	385		(222)		27		232		—		422

ALLL	4,798		(1,663)		313		1,394		—		4,842
RUFC	295		—		—		5		(2)		298
ACL	$	5,093	$	(1,663)	$	313	$	1,399	$	(2)	$	5,140

(1)Includes the amounts for the ALLL for PCD acquisitions, the impact of adopting the Troubled Debt Restructurings and Vintage Disclosures accounting standard, and other activity.

(2)Truist sold its student loan portfolio at the end of the second quarter of 2023.

The commercial ALLL decreased $16 million, and the consumer and credit card ALLL increased $50 million in the three months ended September 30, 2024. The decrease in the commercial ALLL primarily reflects a decrease in commercial loan balances that was partially offset by an increased reserve rate that included incremental reserves related to Hurricane Helene. The change in the consumer and credit card ALLL primarily reflects an increase in indirect auto and other consumer loan balances that was partially offset by a modest decrease in the residential mortgage reserve rate. The commercial ALLL decreased $5 million, and the consumer and credit card ALLL increased $49 million in the nine months ended September 30, 2024. The decrease in the commercial ALLL primarily reflects a decrease in commercial loan balances that was partially offset by increases in the reserve rates related to the CRE and commercial construction portfolios. The change in the consumer and credit card ALLL was primarily driven by increases in reserve rates related to certain consumer non-real estate portfolios that were partially offset by decreases in loan balances and a decrease in the reserve rate related to the residential mortgage portfolio.

The quantitative models have been designed to estimate losses using macro-economic forecasts over a reasonable and supportable forecast period of two years, followed by a reversion to long-term historical loss conditions over a one-year period. Forecasts of macroeconomic variables used in loss forecasting include unemployment trends, U.S. real GDP, corporate credit spreads, property values, home price indices, and used car prices.

The overall economic forecast incorporates a third-party baseline forecast that is adjusted to reflect Truist’s interest rate outlook. Management also considers optimistic and pessimistic third-party macro-economic forecasts in order to capture uncertainty in the economic environment. These forecasts, along with the primary economic forecast, are weighted 40% baseline, 30% optimistic, and 30% pessimistic in the September 30, 2024 ACL, unchanged since December 31, 2023. While the scenario weightings were unchanged, the economic outlook relative to the prior period varied by economic variable and time period. The economic outlook generally reflected modest improvement in GDP growth and no material change in forecasted unemployment compared to the prior quarter. The overall economic forecast shaping the ACL estimate at September 30, 2024 included GDP growth in the low-single digits and an unemployment rate near the mid-single digits.

Quantitative models have certain limitations with respect to estimating expected losses, particularly in times of rapidly changing macro-economic conditions and forecasts. As a result, management believes that the qualitative component of the ACL, which incorporates management’s judgment related to expected future credit losses, will continue to be an important component of the ACL for the foreseeable future. The September 30, 2024 ACL estimate includes adjustments to consider the impact of current and expected events or risks not captured by the loss forecasting models, the outcomes of which are uncertain and may not be completely considered by quantitative models. Refer to “Note 1. Basis of Presentation” in Truist’s Annual Report on Form 10-K for the year ended December 31, 2023 for additional information.

20 Truist Financial Corporation

NPAs

The following table provides a summary of nonperforming loans and leases, excluding LHFS:


	September 30, 2024				December 31, 2023
	Recorded Investment				Recorded Investment
(Dollars in millions)	Without an ALLL		With an ALLL		Without an ALLL		With an ALLL
Commercial:
Commercial and industrial	$	134	$	441	$	123	$	347
CRE	60		242		154		130
Commercial construction	—		1		—		24

Consumer:
Residential mortgage	2		154		1		152
Home equity	1		117		1		121
Indirect auto	26		226		20		248
Other consumer	—		63		—		59


Total	$	223	$	1,244	$	299	$	1,081

The following table presents a summary of nonperforming assets and residential mortgage loans in the process of foreclosure:


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
Nonperforming loans and leases HFI	$	1,467	$	1,380
Nonperforming LHFS	5		51
Foreclosed real estate	3		3
Other foreclosed property	53		54
Total nonperforming assets	$	1,528	$	1,488

Residential mortgage loans in the process of foreclosure	$	179	$	214

Truist Financial Corporation 21

Loan Modifications

The following tables summarize the amortized cost basis and the weighted average financial effect of loans to borrowers experiencing financial difficulty that were modified during the period, disaggregated by class of financing receivable and type of modification granted.


Three Months Ended September 30, 2024 (Dollars in millions)	Renewals		Term Extensions		Interest Rate Adjustments		Capitalizations		Payment Delays		Combination - Interest Rate Adjustment and Term Extension		Combination - Capitalization and Term Extension		Combination - Capitalization, Interest Rate and Term Extension		Other		Total Modified Loans		Percentage of Total Class of Financing Receivable
Commercial:
Commercial and industrial	$	272	$	—	$	12	$	—	$	—	$	—	$	—	$	—	$	73	$	357	0.23	%
CRE	87		—		—		—		—		—		—		—		—		87		0.42
Commercial construction	42		—		—		—		—		—		—		—		—		42		0.53
Consumer:
Residential mortgage	—		20		—		16		25		1		70		13		1		146		0.27
Home equity	—		1		—		—		—		1		—		—		—		2		0.02
Indirect auto	—		10		—		—		632		3		—		—		4		649		2.88
Other consumer	—		10		—		—		—		1		—		—		—		11		0.04
Credit card	—		—		8		—		—		—		—		—		—		8		0.17
Total	$	401	$	41	$	20	$	16	$	657	$	6	$	70	$	13	$	78	$	1,302	0.43



Nine Months Ended September 30, 2024 (Dollars in millions)	Renewals		Term Extensions		Interest Rate Adjustments		Capitalizations		Payment Delays		Combination - Interest Rate Adjustment and Term Extension		Combination - Capitalization and Term Extension		Combination - Capitalization, Interest Rate and Term Extension		Other		Total Modified Loans		Percentage of Total Class of Financing Receivable
Commercial:
Commercial and industrial	$	517	$	—	$	12	$	—	$	2	$	—	$	—	$	—	$	140	$	671	0.44	%
CRE	248		—		—		—		—		—		—		—		13		261		1.25
Commercial construction	47		—		—		—		—		—		—		—		—		47		0.59
Consumer:
Residential mortgage	—		60		—		42		41		1		176		35		3		358		0.66
Home equity	—		2		—		—		2		6		—		—		—		10		0.10
Indirect auto	—		22		—		—		1,230		11		—		—		10		1,273		5.66
Other consumer	—		28		1		—		1		3		—		—		—		33		0.11
Credit card	—		—		28		—		—		—		—		—		—		28		0.58
Total	$	812	$	112	$	41	$	42	$	1,276	$	21	$	176	$	35	$	166	$	2,681	0.88

22 Truist Financial Corporation


Three Months Ended September 30, 2023 (Dollars in millions)	Renewals		Term Extensions		Capitalizations		Payment Delays		Combination - Interest Rate Adjustment and Term Extension		Combination - Capitalization and Term Extension		Combination - Capitalization, Interest Rate and Term Extension		Other		Total Modified Loans		Percentage of Total Class of Financing Receivable
Commercial:
Commercial and industrial	$	426	$	—	$	—	$	3	$	—	$	—	$	—	$	—	$	429	0.26	%
CRE	28		—		—		—		—		—		—		—		28		0.12
Commercial construction	21		—		—		—		—		—		—		—		21		0.33
Consumer:
Residential mortgage	—		30		27		23		—		79		15		1		175		0.31
Home equity	—		—		—		2		2		—		—		1		5		0.05
Indirect auto	—		7		—		388		4		—		—		2		401		1.67
Other consumer	—		6		—		—		1		—		—		—		7		0.02

Credit card	—		—		—		—		—		—		—		4		4		0.08
Total	$	475	$	43	$	27	$	416	$	7	$	79	$	15	$	8	$	1,070	0.34


Nine Months Ended September 30, 2023 (Dollars in millions)	Renewals		Term Extensions		Capitalizations		Payment Delays		Combination - Interest Rate Reduction and Term Extension		Combination - Capitalization and Term Extension		Combination - Capitalization, Interest Rate and Term Extension		Other		Total Modified Loans		Percentage of Total Class of Financing Receivable
Commercial:
Commercial and industrial	$	884	$	51	$	—	$	23	$	44	$	—	$	—	$	—	$	1,002	0.62	%
CRE	173		—		—		72		—		—		—		—		245		1.08
Commercial construction	24		—		—		—		—		—		—		—		24		0.38
Consumer:
Residential mortgage	—		82		95		62		2		254		52		4		551		0.98
Home equity	—		—		—		2		7		—		—		2		11		0.11
Indirect auto	—		19		—		483		13		—		—		5		520		2.16
Other consumer	—		15		—		1		4		—		—		1		21		0.07

Credit card	—		—		—		—		—		—		—		14		14		0.28
Total	$	1,081	$	167	$	95	$	643	$	70	$	254	$	52	$	26	$	2,388	0.76

Truist Financial Corporation 23


Three Months Ended September 30, 2024
Loan Type						Financial Effect
Renewals
Commercial and industrial						Extended the term by 9 months and increased the interest rate by 0.6%
CRE						Extended the term by 10 months and increased the interest rate by 0.7%
Commercial construction						Extended the term by 35 months and increased the interest rate by 0.2%
Term Extensions

Residential mortgage						Extended the term by 92 months
Home equity						Extended the term by 197 months
Indirect auto						Extended the term by 28 months
Other consumer						Extended the term by 23 months
Interest Rate Adjustments
Commercial and industrial						Increased the interest rate by 1%
Credit card						Decreased the interest rate by 19%
Capitalizations
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance
Payment Delays


Residential mortgage						Provided 240 days of payment deferral

Indirect auto						Provided 214 days of payment deferral

Combination - Interest Rate Adjustment and Term Extension

Residential mortgage						Extended the term by 12 months and decreased the interest rate by 1%
Home equity						Extended the term by 320 months and decreased the interest rate by 2%
Indirect auto						Extended the term by 12 months and decreased the interest rate by 4%
Other consumer						Extended the term by 60 months and nominally decreased the interest rate
Combination - Capitalization and Term Extension
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance and extended the term by 84 months
Combination - Capitalization, Interest Rate and Term Extension
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance, extended the term by 122 months, and decreased the interest rate by 0.8%

24 Truist Financial Corporation


Nine Months Ended September 30, 2024
Loan Type						Financial Effect
Renewals
Commercial and industrial						Extended the term by 18 months and increased the interest rate by 0.4%
CRE						Extended the term by 8 months and increased the interest rate by 0.4%
Commercial construction						Extended the term by 32 months and increased the interest rate by 0.2%
Term Extensions

Residential mortgage						Extended the term by 103 months
Home equity						Extended the term by 174 months
Indirect auto						Extended the term by 27 months
Other consumer						Extended the term by 24 months
Interest Rate Adjustments
Commercial and industrial						Increased the interest rate by 1%
Other consumer						Decreased the interest rate by 2%
Credit card						Decreased the interest rate by 19%
Capitalizations
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance
Payment Delays
Commercial and industrial						Provided 97 days of payment deferral

Residential mortgage						Provided 223 days of payment deferral
Home equity						Provided 179 days of payment deferral
Indirect auto						Provided 199 days of payment deferral
Other consumer						Provided 157 days of payment deferral
Combination - Interest Rate Adjustment and Term Extension

Residential mortgage						Extended the term by 44 months and decreased the interest rate by 0.4%
Home equity						Extended the term by 284 months and decreased the interest rate by 3%
Indirect auto						Extended the term by 14 months and decreased the interest rate by 4%
Other consumer						Extended the term by 59 months and decreased the interest rate by 0.1%
Combination - Capitalization and Term Extension
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance and extended the term by 84 months
Combination - Capitalization, Interest Rate and Term Extension
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance, extended the term by 132 months, and decreased the interest rate by 0.7%

Truist Financial Corporation 25


Three Months Ended September 30, 2023
Loan Type						Financial Effect
Renewals
Commercial and industrial						Extended the term by 9 months and increased the interest rate by 0.7%
CRE						Extended the term by 15 months and increased the interest rate by 0.9%
Commercial construction						Extended the term by 2 months
Term Extensions
Residential mortgage						Extended the term by 117 months
Indirect auto						Extended the term by 24 months
Other Consumer						Extended the term by 24 months
Capitalizations
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance
Payment Delays
Commercial and industrial						Provided 120 days of payment deferral
Residential mortgage						Provided 214 days of payment deferral
Home equity						Provided 177 days of payment deferral
Indirect auto						Provided 135 days of payment deferral
Combination - Interest Rate Adjustment and Term Extension


Home equity						Extended the term by 322 months and decreased the interest rate by 5%
Indirect auto						Extended the term by 12 months and decreased the interest rate by 5%
Other consumer						Extended the term by 56 months and decreased the interest rate by 1%
Combination - Capitalization and Term Extension
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance and extended the term by 101 months
Combination - Capitalization, Interest Rate and Term Extension
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance, extended the term by 144 months, and decreased the interest rate by 0.4%

26 Truist Financial Corporation


Nine Months Ended September 30, 2023
Loan Type						Financial Effect
Renewals
Commercial and industrial						Extended the term by 8 months and increased the interest rate by 0.6%
CRE						Extended the term by 11 months and increased the interest rate by 0.2%
Commercial construction						Extended the term by 2 months
Term Extensions
Commercial and industrial						Extended the term by 3 months
Residential mortgage						Extended the term by 139 months
Indirect auto						Extended the term by 22 months
Other consumer						Extended the term by 24 months
Capitalizations
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance
Payment Delays
Commercial and industrial						Provided 183 days of payment deferral
CRE						Provided 232 days of payment deferral
Residential mortgage						Provided 212 days of payment deferral
Home equity						Provided 167 days of payment deferral
Indirect auto						Provided 133 days of payment deferral
Other consumer						Provided 153 days of payment deferral
Combination - Interest Rate Adjustment and Term Extension
Commercial and industrial						Extended the term by 76 months and increased the interest rate by 3%
Residential mortgage						Extended the term by 124 months and increased the interest rate by 0.5%
Home equity						Extended the term by 258 months and decreased the interest rate by 3%
Indirect auto						Extended the term by 11 months and decreased the interest rate by 7%
Other consumer						Extended the term by 61 months and decreased the interest rate by 1%
Combination - Capitalization and Term Extension
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance and extended the term by 105 months
Combination - Capitalization, Interest Rate and Term Extension
Residential mortgage						Capitalized a portion of forborne loan and other advanced payments into the outstanding loan balance, extended the term by 130 months, and decreased the interest rate by 0.2%

The tables above exclude trial modifications totaling $46 million and $77 million as of September 30, 2024 and 2023, respectively. Such modifications will be included in the modification activity disclosure if the borrower successfully completes the trial period and the loan modification is finalized.

As of September 30, 2024 and December 31, 2023, Truist had $389 million and $702 million, respectively, in unfunded lending commitments to lend additional funds to borrowers experiencing financial difficulty for which Truist has modified the terms of the loans in the ways described above during the twelve months preceding September 30, 2024 and December 31, 2023, respectively.

Upon Truist’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is written off. Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount.

Truist Financial Corporation 27

Truist closely monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table summarizes the period-end delinquency status and amortized cost of loans that were modified in the last 12 months. The period-end delinquency status of loans that were modified are disclosed at amortized cost and reflect the impact of any paydowns, payoffs, or charge-offs that occurred subsequent to modification.


	Payment Status (Amortized Cost Basis)
September 30, 2024 (Dollars in millions)	Current		30-89 Days Past Due		90 Days or More Past Due		Total
Commercial:
Commercial and industrial	$	721	$	7	$	27	$	755
CRE	246		11		2		259
Commercial construction	76		—		—		76
Consumer:
Residential mortgage	296		81		95		472
Home equity	10		—		—		10
Indirect auto	1,015		202		58		1,275
Other consumer	32		2		1		35
Credit card	19		5		3		27
Total	$	2,415	$	308	$	186	$	2,909
Total nonaccrual loans included above	$	277	$	50	$	126	$	453

	Payment Status (Amortized Cost Basis)
December 31, 2023 (Dollars in millions)	Current		30-89 Days Past Due		90 Days or More Past Due		Total
Commercial:
Commercial and industrial	$	887	$	48	$	92	$	1,027
CRE	233		11		1		245
Commercial construction	22		—		—		22
Consumer:
Residential mortgage	427		116		90		633
Home equity	11		—		—		11
Indirect auto	730		148		20		898
Other consumer	24		1		—		25
Credit card	11		3		2		16
Total	$	2,345	$	327	$	205	$	2,877
Total nonaccrual loans included above	$	155	$	85	$	137	$	377

The following table provides the amortized cost basis of financing receivables that were modified in the last twelve months and were in payment default at period end:


September 30, 2024 (Dollars in millions)	Renewals		Term Extensions		Interest Rate Adjustments		Capitalizations		Payment Delays		Combination - Capitalization and Term Extension		Combination - Capitalization, Interest Rate and Term Extension		Other		Total
Commercial:
Commercial and industrial	$	27	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	27
CRE	2		—		—		—		—		—		—		—		2

Consumer:
Residential mortgage	—		13		—		9		37		31		5		—		95

Indirect auto	—		—		—		—		56		—		—		2		58
Other consumer	—		1		—		—		—		—		—		—		1
Credit card	—		—		3		—		—		—		—		—		3
Total	$	29	$	14	$	3	$	9	$	93	$	31	$	5	$	2	$	186

28 Truist Financial Corporation
















December 31, 2023 (Dollars in millions)	Renewals		Term Extensions		Capitalizations		Payment Delays		Combination - Capitalization and Term Extension		Combination - Capitalization, Interest Rate and Term Extension		Other		Total
Commercial:
Commercial and industrial	$	72	$	—	$	—	$	20	$	—	$	—	$	—	$	92
CRE	1		—		—		—		—		—		—		1

Consumer:
Residential mortgage	—		13		6		34		31		5		1		90

Indirect auto	—		1		—		17		—		—		2		20

Credit card	—		—		—		—		—		—		2		2
Total	$	73	$	14	$	6	$	71	$	31	$	5	$	5	$	205

Unearned Income, Discounts, and Net Deferred Loan Fees and Costs

The following table presents additional information about loans and leases:


(Dollars in millions)			Sep 30, 2024						Dec 31, 2023
Unearned income, discounts, and net deferred loan fees and costs			$	578					$	553

Truist Financial Corporation 29

NOTE 6. Goodwill and Other Intangible Assets

Effective January 1, 2024, several business activities were realigned reflecting updates to the Company’s operating structure. First, the CB&W segment was renamed CSBB and the C&CB segment was renamed WB. Second, the Wealth business was realigned into the WB segment from the CSBB segment, representing a separate reporting unit in that segment. Third, the small business banking client segmentation was realigned into the CSBB segment from the WB segment. Further, TIH was the principal legal entity of the IH segment. As the operations of TIH were included in discontinued operations prior to the sale of TIH, the Company no longer presents the IH segment as one of its reportable segments. Following the realignment of these business activities, the Company’s three reporting units with goodwill balances are CSBB, WB, and Wealth.

In conjunction with these realignments, goodwill of $1.7 billion was realigned to WB from CSBB based on the relative fair value of CSBB and Wealth, and goodwill of $220 million was realigned to CSBB from WB based on the relative fair value of WB and the realigned small business banking client segmentation. In addition, the Company completed an assessment of any potential goodwill impairment for all impacted reporting units immediately prior and subsequent to the realignments and determined that no impairment existed. The quantitative valuation of WB performed in conjunction with these goodwill realignments indicated that as of January 1, 2024, the fair value of the WB reporting unit exceeded its carrying value by less than 10%, indicating that the goodwill of the WB reporting unit may be at risk of impairment.

The Company monitored events and circumstances during the period from January 1, 2024 to September 30, 2024, including macroeconomic and market factors, industry and banking sector events, Truist specific performance indicators, a comparison of management’s forecast and assumptions to those used in its January 1, 2024 quantitative valuations associated with the realignments of goodwill, and the sensitivity of the January 1, 2024 quantitative results to changes in assumptions as of September 30, 2024. Based on these considerations, Truist concluded that it was not more-likely-than-not that the fair value of one or more of its reporting units is below its respective carrying amount as of September 30, 2024.

The changes in the carrying amount of goodwill attributable to operating segments are reflected in the table below. Activity during 2024 primarily relates to the segment realignment described above and the divestiture of Sterling Capital Management, LLC. Refer to “Note 2. Discontinued Operations” for additional information related to discontinued operations and “Note 18. Operating Segments” for additional information on segments.



(Dollars in millions)	CSBB		WB		Total







Goodwill, December 31, 2023	$	13,503	$	3,653	$	17,156
Segment realignment	(1,498)		1,498		—


Divestitures	—		(32)		(32)
Adjustments and other	—		1		1
Goodwill, September 30, 2024	$	12,005	$	5,120	$	17,125

The following table, which excludes fully amortized intangibles, presents information for identifiable intangible assets:


		September 30, 2024									December 31, 2023
(Dollars in millions)	Gross Carrying Amount			Accumulated Amortization			Net Carrying Amount			Gross Carrying Amount			Accumulated Amortization			Net Carrying Amount
CDI		$	2,453		$	(1,785)		$	668		$	2,473		$	(1,650)		$	823
Other, primarily client relationship intangibles		1,578			(611)			967			1,598			(512)			1,086
Total		$	4,031		$	(2,396)		$	1,635		$	4,071		$	(2,162)		$	1,909

30 Truist Financial Corporation

NOTE 7. Loan Servicing

The Company acquires servicing rights, and retains servicing rights related to certain of its sales or securitizations of residential mortgages, commercial mortgages, and other consumer loans. Servicing rights are capitalized by the Company as Loan servicing rights on the Consolidated Balance Sheets. Income earned by the Company on its loan servicing rights is derived primarily from contractually specified servicing fees, late fees, net of curtailment costs, and other ancillary fees.

Residential Mortgage Activities

The following tables summarize residential mortgage servicing activities:



(Dollars in millions)	Sep 30, 2024			Dec 31, 2023
UPB of residential mortgage loan servicing portfolio	$	275,424		$	269,068
UPB of residential mortgage loans serviced for others, primarily agency conforming fixed rate	221,143			213,399
Mortgage loans sold with recourse	149			173
Maximum recourse exposure from mortgage loans sold with recourse liability	92			109
Indemnification, recourse and repurchase reserves	46			52

As of / For the Nine Months Ended September 30, (Dollars in millions)	2024			2023
UPB of residential mortgage loans sold from LHFS	$	7,758		$	10,643
Pre-tax gains recognized on mortgage loans sold and held for sale	56			49
Servicing fees recognized from mortgage loans serviced for others	443			517
Approximate weighted average servicing fee on the outstanding balance of residential mortgage loans serviced for others	0.28		%	0.27		%
Weighted average interest rate on mortgage loans serviced for others	3.62			3.51

The following table presents a roll forward of the carrying value of residential MSRs recorded at fair value:




(Dollars in millions)	2024		2023
Residential MSRs, carrying value, January 1	$	3,088	$	3,428
Acquired	230		123
Additions	127		199
Sales	(2)		(531)
Change in fair value due to changes in valuation inputs or assumptions(1)	(2)		207


Realization of expected net servicing cash flows, passage of time, and other	(206)		(204)
Residential MSRs, carrying value, September 30	$	3,235	$	3,222

(1)The nine months ended September 30, 2023 includes realized gains on the portfolio sale of excess servicing.

The sensitivity of the fair value of the Company’s residential MSRs to changes in key assumptions is presented in the following table:


	September 30, 2024								December 31, 2023
	Range				Weighted Average				Range					Weighted Average
(Dollars in millions)	Min		Max					Min			Max
Prepayment speed	6.8	%	19.3	%	8.0		%		6.7	%		18.2	%	7.5		%
Effect on fair value of a 10% increase					$	(91)								$	(82)
Effect on fair value of a 20% increase					(176)									(160)
OAS	2.2	%	12.6	%	4.9		%		2.2	%		12.0	%	4.6		%
Effect on fair value of a 10% increase					$	(68)								$	(60)
Effect on fair value of a 20% increase					(133)									(118)
Composition of loans serviced for others:
Fixed-rate residential mortgage loans					99.7		%							99.6		%
Adjustable-rate residential mortgage loans					0.3									0.4
Total					100.0		%							100.0		%
Weighted average life					7.3 years									7.5 years

The sensitivity calculations above are hypothetical and should not be considered predictive of future performance. As indicated, changes in fair value based on adverse changes in assumptions generally cannot be extrapolated because the relationship of the change in assumption to the change in fair value may not be linear. Also, in the above table, the effect of an adverse variation in one assumption on the fair value of the MSRs is calculated without changing any other assumption; while in reality, changes in one factor may result in changes in another, which may magnify or counteract the effect of the change. See “Note 15. Fair Value Disclosures” for additional information on the valuation techniques used.

Truist Financial Corporation 31

Commercial Mortgage Activities

The following table summarizes commercial mortgage servicing activities:



(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
UPB of CRE mortgages serviced for others	$	28,241	$	31,681
CRE mortgages serviced for others covered by recourse provisions	9,615		9,661
Maximum recourse exposure from CRE mortgages sold with recourse liability	2,815		2,813
Recorded reserves related to recourse exposure	12		16
CRE mortgages originated during the year-to-date period	784		2,989
Commercial MSRs at fair value	255		272

NOTE 8. Other Assets and Liabilities

Lessee Operating and Finance Leases

The Company leases certain assets, consisting primarily of real estate, and assesses at contract inception whether a contract is, or contains, a lease. The following tables present additional information on leases, excluding leases related to the lease financing businesses:




	September 30, 2024						December 31, 2023






(Dollars in millions)	Operating Leases			Finance Leases			Operating Leases			Finance Leases
ROU assets	$	920		$	15		$	1,057		$	10









Total lease liabilities	1,220			17			1,387			12
Weighted average remaining term	5.8 years			8.2 years			6.2 years			6.6 years
Weighted average discount rate	3.2		%	5.2		%	3.1		%	5.1		%


	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	2024		2023		2024		2023
Operating lease costs	$	66	$	65	$	209	$	204

Lessor Operating Leases

The Company’s two primary lessor businesses are equipment financing and structured real estate with income recorded in Operating lease income on the Consolidated Statements of Income. The following table presents a summary of assets under operating leases held for investment. This table excludes subleases on assets included in premises and equipment.


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
Assets held under operating leases(1)(2)	$	1,878	$	2,160


Accumulated depreciation	(536)		(583)
Net	$	1,342	$	1,577

(1)Includes certain land parcels subject to operating leases that have indefinite lives.

(2)Excludes operating leases held-for-sale that totaled $99 million and $32 million at September 30, 2024 and December 31, 2023, respectively.

Bank-Owned Life Insurance

Bank-owned life insurance consists of life insurance policies held on certain teammates for which the Company is the beneficiary. The carrying value of bank-owned life insurance was $7.8 billion and $7.7 billion at September 30, 2024 and December 31, 2023, respectively.

32 Truist Financial Corporation

NOTE 9. Borrowings

The following table presents a summary of short-term borrowings:


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023

FHLB advances	$	14,150		$	20,500
Securities sold under agreements to repurchase	3,955			2,427
Securities sold short	2,545			1,625


Other short-term borrowings	209			276
Total short-term borrowings	$	20,859		$	24,828

The following table presents a summary of long-term debt:


(Dollars in millions)			Sep 30, 2024		Dec 31, 2023
	Carrying Amount	Carrying Amount

Truist Financial Corporation:
Fixed rate senior notes(1)			$	23,335	$	19,808
Floating rate senior notes			—		999
Fixed rate subordinated notes(1)(2)			1,828		1,831
Capital notes(2)			633		629

Truist Bank:
Fixed rate senior notes			2,980		4,170
Floating rate senior notes			—		1,250
Fixed rate subordinated notes(2)			4,774		4,770

Floating rate FHLB advances			1,750		4,200
Other long-term debt(3)			1,470		1,261


Total long-term debt			$	36,770	$	38,918

(1)Certain senior and subordinated notes convert from fixed to floating one year prior to maturity, and are callable within the final year of maturity at par.

(2)Subordinated and capital notes with a remaining maturity of one year or greater qualify under the risk-based capital guidelines as Tier 2 supplementary capital, subject to certain limitations.

(3)Includes debt associated with finance leases, tax credit investments, and other.

NOTE 10. Shareholders’ Equity

Common Stock

The following table presents total dividends declared per share of common stock:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Cash dividends declared per share	$	0.52	$	0.52	$	1.56	$	1.56

Share Repurchase Activity

In June 2024, Truist announced that the Board had authorized the repurchase of up to $5.0 billion of common stock beginning in the third quarter of 2024 through 2026 as part of Truist’s overall capital distribution strategy. During the third quarter of 2024, the Company repurchased $503 million of common stock, including excise tax, which represented 11.7 million shares, through open market repurchases. Repurchased shares revert to the status of authorized and unissued shares upon repurchase. At September 30, 2024, Truist had remaining authorization to repurchase up to $4.5 billion of common stock under the Board approved repurchase plan.

Preferred Stock Redemptions

On November 1, 2024, Truist announced that it will redeem all outstanding shares of its Series L Perpetual Preferred Stock (“Series L Preferred Stock”) and the corresponding depositary shares representing fractional interests in the Series L Preferred Stock (“Series L Depositary Shares”) for $750 million.

The Series L Depositary Shares (CUSIP: 89832QAB5), each representing a 1/100th interest in a share of Series L Preferred Stock, will be redeemed simultaneously with the redemption of the Series L Preferred Stock, in each case at a redemption price of $1,000 per depositary share (equivalent to $100,000 per share of preferred stock) plus any accrued and unpaid dividends to the redemption date. All 7,500 outstanding shares of the Series L Preferred Stock and all 750,000 outstanding Series L Depositary Shares will be redeemed on the dividend payment date of December 16, 2024.

Truist Financial Corporation 33

Regular quarterly dividends on the outstanding shares of the Series L Preferred Stock and the Series L Depositary Shares will be paid separately to holders of record as of November 8, 2024 in the customary manner. On and after the redemption date, all dividends on the shares of Series L Preferred Stock and the Series L Depositary Shares will cease to accrue.

NOTE 11. AOCI

AOCI includes the after-tax change in unrecognized net costs related to defined benefit pension and OPEB plans as well as unrealized gains and losses on cash flow hedges, AFS securities, and HTM securities previously transferred from AFS securities.






(Dollars in millions)	Pension and OPEB Costs		Cash Flow Hedges		AFS Securities		HTM Securities		Other, net		Total
AOCI balance, July 1, 2023	$	(1,541)	$	(270)	$	(9,092)	$	(2,468)	$	(3)	$	(13,374)
OCI before reclassifications, net of tax	10		(268)		(1,938)		—		(1)		(2,197)

Amounts reclassified from AOCI:
Before tax	16		17		(100)		82		—		15
Tax effect	3		4		(23)		19		—		3
Amounts reclassified, net of tax	13		13		(77)		63		—		12
Total OCI, net of tax	23		(255)		(2,015)		63		(1)		(2,185)
AOCI balance, September 30, 2023	$	(1,518)	$	(525)	$	(11,107)	$	(2,405)	$	(4)	$	(15,559)
AOCI balance, July 1, 2024	$	(1,044)	$	(528)	$	(4,690)	$	(2,239)	$	(3)	$	(8,504)
OCI before reclassifications, net of tax	(14)		426		1,146		—		1		1,559

Amounts reclassified from AOCI:
Before tax	—		108		(104)		77		—		81
Tax effect	—		26		(25)		18		—		19
Amounts reclassified, net of tax	—		82		(79)		59		—		62
Total OCI, net of tax	(14)		508		1,067		59		1		1,621
AOCI balance, September 30, 2024	$	(1,058)	$	(20)	$	(3,623)	$	(2,180)	$	(2)	$	(6,883)

(Dollars in millions)	Pension and OPEB Costs		Cash Flow Hedges		AFS Securities		HTM Securities		Other, net		Total








AOCI balance, January 1, 2023	$	(1,535)	$	(78)	$	(9,395)	$	(2,588)	$	(5)	$	(13,601)
OCI before reclassifications, net of tax	(21)		(464)		(1,531)		—		1		(2,015)

Amounts reclassified from AOCI:
Before tax	49		22		(236)		234		—		69
Tax effect	11		5		(55)		51		—		12
Amounts reclassified, net of tax	38		17		(181)		183		—		57
Total OCI, net of tax	17		(447)		(1,712)		183		1		(1,958)
AOCI balance, September 30, 2023	$	(1,518)	$	(525)	$	(11,107)	$	(2,405)	$	(4)	$	(15,559)
AOCI balance, January 1, 2024	$	(1,079)	$	(300)	$	(8,778)	$	(2,347)	$	(2)	$	(12,506)
OCI before reclassifications, net of tax(1)	21		95		366		—		—		482

Amounts reclassified from AOCI:
Before tax	—		242		6,267		218		—		6,727
Tax effect	—		57		1,478		51		—		1,586
Amounts reclassified, net of tax	—		185		4,789		167		—		5,141
Total OCI, net of tax	21		280		5,155		167		—		5,623
AOCI balance, September 30, 2024	$	(1,058)	$	(20)	$	(3,623)	$	(2,180)	$	(2)	$	(6,883)
Primary income statement location of amounts reclassified from AOCI	Other expense		Net interest income		Securities gains (losses) and Net interest income		Net interest income		Net interest income

(1)Includes the impact of the remeasurement of the pension plan and the reduction of pension benefit obligations following the sale of TIH. Refer to “Note 13. Benefit Plans” for additional information.

34 Truist Financial Corporation

NOTE 12. Income Taxes

For the three months ended September 30, 2024, the provision for income taxes was $271 million compared to $203 million for the three months ended September 30, 2023, representing effective tax rates of 15.8% and 15.5%, respectively. For the nine months ended September 30, 2024, the benefit from income taxes was $821 million compared to a provision for income taxes of $794 million for the nine months ended September 30, 2023, representing effective tax rates of 38.1% and 17.7%, respectively. The higher effective tax rate for the three months ended September 30, 2024 was due to higher full year forecasted effective tax rate in the current year, excluding the pre-tax loss from the balance sheet repositioning of securities. The tax benefit on the pre-tax loss for the nine months ended September 30, 2024 was driven by the discrete impact of the balance sheet repositioning of securities. The Company calculated the provision for income taxes by applying the estimated annual effective tax rate to year-to-date pre-tax income and adjusting for discrete items that occurred during the period.

NOTE 13. Benefit Plans

The components of net periodic (benefit) cost for defined benefit pension plans are summarized in the following table:


		Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	Income Statement Location	2024		2023		2024		2023
Service cost(1)	Personnel expense / Net income from discontinued operations	$	69	$	77	$	249	$	263
Interest cost	Other expense	112		112		332		334
Estimated return on plan assets	Other expense	(235)		(226)		(717)		(682)
Amortization and other	Other expense	—		19		1		59
Net periodic (benefit) cost		$	(54)	$	(18)	$	(135)	$	(26)

(1)Includes $4 million for the three months ended September 30, 2023 and $10 million and $17 million for the nine months ended September 30, 2024 and 2023, respectively, of service cost reported in net income from discontinued operations for the qualified defined benefit pension plan for employees of TIH.

Truist may make contributions to the qualified pension plans up to the maximum amount deductible for federal income tax purposes. Truist did not make a discretionary contribution to the qualified pension plan during the nine months ended September 30, 2024.

Following the sale of TIH, Truist retained the postretirement benefit obligation for TIH employees and changed the status of TIH employees by eliminating their eligibility to earn future service credits. Changes in pension plan obligations associated with the disposal of operating segments such as TIH require the remeasurement of postretirement benefit obligations prior to the disposal, updates to pension plan assumptions inherent in valuations, and identification and recognition of valuation changes specific to the sale, including the establishment of a new periodic service cost using assumptions as of the remeasurement date. The remeasurement process of impacted pension plans included a reduction in pension benefit obligations of $783 million and a loss on plan assets of $834 million, primarily driven by an increase in the weighted average assumed discount rate from 5.12% to 5.78%, and a decrease in the value of plan assets by $508 million, primarily driven by market prices. The impact of the sale on Truist pension plans resulted in a reduction of pension benefit obligations by $97 million which was recorded as a reduction of AOCI. Refer to “Note 11. AOCI” for additional information.

Truist Financial Corporation 35

NOTE 14. Commitments and Contingencies

Truist utilizes a variety of financial instruments to mitigate exposure to risks and meet the financing needs and provide investment opportunities for clients. These financial instruments include commitments to extend credit, letters of credit and financial guarantees, derivatives, and other investments. Truist also has commitments to fund certain affordable housing investments and contingent liabilities related to certain sold loans.

Tax Credit and Certain Equity Investments

The following table summarizes certain tax credit and certain equity investments:


(Dollars in millions)	Balance Sheet Location	Sep 30, 2024		Dec 31, 2023
Investments in affordable housing projects and other qualified tax credits:
Carrying amount	Other assets	$	7,262	$	6,754
Amount of future funding commitments included in carrying amount	Other liabilities	2,396		2,473
Lending exposure	Loans and leases for funded amounts	2,106		1,981

Renewable energy investments:
Carrying amount	Other assets	499		285
Amount of future funding commitments not included in carrying amount	NA	810		747
SBIC and certain other equity method investments:
Carrying amount	Other assets	810		758
Amount of future funding commitments not included in carrying amount	NA	600		589

The following table presents a summary of tax credits and amortization expense associated with the Company’s tax credit investment activity. Activity related to the Company’s renewable energy investments, other than qualified tax credits, was immaterial.


		Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	Income Statement Location	2024		2023		2024		2023
Tax credits:


Investments in affordable housing projects, other qualified tax credits, and other community development investments	Provision for income taxes	$	190	$	163	$	560	$	480

Amortization and other changes in carrying amount:
Investments in affordable housing projects and other qualified tax credits	Provision for income taxes	$	171	$	153	$	512	$	451
Other community development investments	Other noninterest income	3		3		8		8

Letters of Credit and Financial Guarantees

In the normal course of business, Truist utilizes certain financial instruments to meet the financing needs of clients and to mitigate exposure to risks. Such financial instruments include commitments to extend credit and certain contractual agreements, including standby letters of credit and financial guarantee arrangements.

The following is a summary of selected notional amounts of off-balance sheet financial instruments:


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
Commitments to extend, originate, or purchase credit and other commitments	$	212,038	$	207,285
Residential mortgage loans sold with recourse	149		173
CRE mortgages serviced for others covered by recourse provisions	9,615		9,661
Other loans serviced for others covered by recourse and other provisions	1,816		1,032
Letters of credit	7,287		6,239

36 Truist Financial Corporation

Total Return Swaps

The Company enters into TRS transactions with third party clients, whereby a VIE purchases reference assets identified by a client. The Company financially supports the VIE’s purchases of the reference assets. Reference assets are typically fixed income instruments primarily composed of syndicated bank loans. The TRS contracts pass through interest and other cash flows on the reference assets to the third-party clients, along with exposing those clients to decreases in value on the reference assets and providing them with the rights to appreciation on the reference assets. The terms of the TRS contracts require the third party clients to post initial margin collateral, as well as ongoing variation margin as the fair values of the underlying reference assets change. The following table provides a summary of the TRS transactions with the associated VIE referenced assets, which include trading loans and bonds:


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
Total return swaps:
VIE assets	$	1,660	$	1,641
Trading loans and bonds	1,418		1,572
VIE liabilities	325		50

The Company concluded that the associated VIEs should be consolidated because the Company has (i) the power to direct the activities that most significantly impact the economic performance of the VIE and (ii) the obligation to absorb losses and the right to receive benefits, which could potentially be significant. The activities of the VIEs are restricted to buying and selling the reference assets, and the risks/benefits of any such assets owned by the VIEs are passed to the third-party clients via the TRS contracts. For additional information on TRS contracts and the related VIEs, see “Note 16. Derivative Financial Instruments.”

Pledged Assets

Certain assets were pledged to secure municipal deposits, securities sold under agreements to repurchase, certain derivative agreements, and borrowings or borrowing capacity, as well as to fund certain obligations related to nonqualified defined benefit and defined contribution retirement plans and for other purposes as required or permitted by law. Assets pledged to the FHLB and FRB are subject to applicable asset discounts when determining borrowing capacity. The Company has capacity for secured financing from both the FRB and FHLB and letters of credit from the FHLB. The Company’s letters of credit from the FHLB can be used to secure various client deposits, including public fund relationships. Excluding assets related to nonqualified benefit plans, the majority of the agreements governing the pledged assets do not permit the other party to sell or repledge the collateral. The following table provides the total carrying amount of pledged assets by asset type:


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
Pledged securities	$	38,085	$	41,270

Pledged loans:
FRB	95,275		73,898
FHLB	71,960		67,748
Unused borrowing capacity:
FRB	73,663		55,252
FHLB	36,689		24,712

Legal Proceedings and Other Matters

Truist is routinely named as a defendant in or a party to numerous actual or threatened legal proceedings and other matters and is or may be subject to potential liability in connection with them. The legal proceedings and other matters may be formal or informal and include litigation and arbitration with one or more identified claimants, certified or purported class actions with yet-to-be-identified claimants, and regulatory or other governmental information-gathering requests, examinations, investigations, and enforcement proceedings. Claims may be based in law or equity—such as those arising under contracts or in tort and those involving banking, consumer-protection, securities, antitrust, tax, employment, and other laws—and some present novel legal theories, allegations of substantial or indeterminate damages, demands for injunctive or similar relief, and requests for fines, penalties, restitution, or alterations in Truist’s business practices. Our legal proceedings and other matters exist in varying stages of adjudication, arbitration, negotiation, or investigation and span our business lines and operations.

The course and outcome of legal proceedings and other matters are inherently unpredictable. This is especially so when a matter is still in its early stages, the damages sought are indeterminate or unsupported, significant facts are unclear or disputed, novel questions of law or other meaningful legal uncertainties exist, a request to certify a proceeding as a class action is outstanding or granted, multiple parties are named, or regulatory or other governmental entities are involved. As a result, we often are unable to determine how or when actual or threatened legal proceedings and other matters will be resolved and what losses may be incrementally and ultimately incurred. It is possible that the ultimate resolution of these matters, including those described below, if unfavorable, may be material to the consolidated financial position, consolidated results of operations, or consolidated cash flows of Truist, or cause significant reputational consequences.

Truist Financial Corporation 37

Truist establishes accruals for legal proceedings and other matters when potential losses become probable and the amount of loss can be reasonably estimated. Accruals are evaluated each quarter and may be adjusted, upward or downward, based on our best judgment after consultation with counsel and others. No assurance exists that our accruals will not need to be adjusted in the future. Actual losses may be higher or lower than any amounts accrued, possibly to a significant degree.

The Company estimates reasonably possible losses, in excess of amounts accrued, of up to approximately $375 million as of September 30, 2024. This estimate does not represent Truist’s maximum loss exposure, and actual losses may vary significantly. Also, the outcome of a particular matter may be one that the Company did not take into account in its estimate because the Company judged the likelihood of that outcome to be remote. In addition, the matters underlying this estimate may change from time to time. Estimated losses, like accruals, are based upon currently available information and involve considerable uncertainties and judgment.

For certain matters, Truist may be unable to estimate the loss or range of loss, even if it believes that a loss is probable or reasonably possible, until developments in the matter provide additional information sufficient to support such an estimate. These matters are not accrued for and are not reflected in the estimate of reasonably possible losses.

The following is a description of certain legal proceedings and other matters in which Truist is involved:

Bickerstaff v. SunTrust Bank

This class action case was filed in Fulton County State Court on July 12, 2010, and an amended complaint was filed on August 9, 2010. Plaintiff alleges that all overdraft fees charged to his account which related to debit card and ATM transactions are actually interest charges and therefore subject to the usury laws of Georgia. The amended complaint asserts claims for violations of civil and criminal usury laws, conversion, and money had and received, and seeks damages on a class-wide basis, including refunds of challenged overdraft fees and pre-judgment interest. On October 6, 2017, the trial court granted plaintiff’s motion for class certification and defined the class as “Every Georgia citizen who had or has one or more accounts with SunTrust Bank and who, from July 12, 2006, to October 6, 2017 (i) had at least one overdraft of $500.00 or less resulting from an ATM or debit card transaction (the “Transaction”); (ii) paid any Overdraft Fees as a result of the Transaction; and (iii) did not receive a refund of those Fees,” and the granting of a certified class was affirmed on appeal. The class seeks a return of up to $452 million in paid overdraft fees from the 2006 to 2017 period above, plus prejudgment interest which, based on the amount of claimed fees, was estimated to be approximately $423 million as of September 30, 2024. A court-ordered mediation was held on February 28, 2024, but no resolution was reached. On March 4, 2024, the trial court issued an order granting in part and denying in part Truist’s motions to amend the class definition to narrow the scope of the class, to compel arbitration against certain class members, and for summary judgment. Truist and the class separately appealed the trial court’s order to the Georgia Court of Appeals, and oral arguments were held on October 22, 2024.

Recordkeeping Matters

The SEC and CFTC requested information from various subsidiaries of the Company that conduct broker-dealer, investment adviser, and swap dealer activities regarding compliance with applicable recordkeeping requirements for business-related electronic communications. In August 2024, the subsidiaries resolved these matters with the SEC and the CFTC.

Investigation Regarding Trusts

In 2016 and 2018, the Civil Division of the U.S. DOJ issued subpoenas to a corporate predecessor of Truist Bank under the Financial Institutions Reform, Recovery, and Enforcement Act. These subpoenas requested documents and other information related to specified trusts for which Truist Bank serves as trustee. In October 2024, Truist Bank resolved the matter by entering into a settlement agreement with the U.S. DOJ.

FDIC Special Assessment

In November 2023, the FDIC issued a final rule to implement a special assessment to recoup losses to the DIF associated with bank failures in the first half of 2023. The assessment is based on an insured depository institution’s estimated uninsured deposits reported as of December 31, 2022. The special assessment for Truist is $579 million, with $507 million recognized in the fourth quarter of 2023 and additional adjustments of $72 million recognized for the nine months ended September 30, 2024 due to changes in the estimated relevant losses to the DIF reported by the FDIC. In June 2024, the FDIC provided notification that the collection period will be extended an additional two quarters beyond the initial eight quarterly installments. The special assessment will be paid in ten quarterly installments, which began in the second quarter of 2024. The ultimate amount of expenses associated with the special assessment will also be impacted by the finalization of the losses incurred by the FDIC in the resolutions of Silicon Valley Bank and Signature Bank, which could result in additional expense.

38 Truist Financial Corporation

NOTE 15. Fair Value Disclosures

Recurring Fair Value Measurements

Accounting standards define fair value as the price that would be received on the measurement date to sell an asset or the price paid to transfer a liability in the principal or most advantageous market available to the entity in an orderly transaction between market participants, with a three-level measurement hierarchy:

Level 1: Quoted prices for identical instruments in active markets
Level 2: Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets
Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable

The following tables present fair value information for assets and liabilities measured at fair value on a recurring basis:


September 30, 2024 (Dollars in millions)	Total		Level 1		Level 2		Level 3		Netting Adjustments(1)
Assets:
Trading assets:
U.S. Treasury	$	187	$	—	$	187	$	—	$	—
GSE	43		—		43		—		—


States and political subdivisions	692		—		692		—		—

Corporate and other debt securities	1,878		—		1,878		—		—
Loans	1,574		—		1,574		—		—
Equity securities	404		404		—		—		—
Other	431		303		128		—		—
Total trading assets	5,209		707		4,502		—		—
AFS securities:
U.S. Treasury	13,475		—		13,475		—		—
GSE	365		—		365		—		—
Agency MBS – residential	47,466		—		47,466		—		—
Agency MBS – commercial	2,371		—		2,371		—		—
States and political subdivisions	418		—		418		—		—

Other	16		—		16		—		—
Total AFS securities	64,111		—		64,111		—		—
LHFS at fair value	1,028		—		1,028		—		—
Loans and leases	13		—		—		13		—
Loan servicing rights at fair value	3,499		—		—		3,499		—
Other assets:
Derivative assets	1,341		1,533		1,774		4		(1,970)
Equity securities	283		276		7		—		—

Total assets	$	75,484	$	2,516	$	71,422	$	3,516	$	(1,970)
Liabilities:
Interest-bearing deposits:
Brokered time deposits	$	99	$	—	$	99	$	—	$	—
Short-term borrowings:
Securities sold short	2,545		550		1,995		—		—
Other liabilities:
Derivative liabilities	1,912		796		3,773		37		(2,694)
Total liabilities	$	4,556	$	1,346	$	5,867	$	37	$	(2,694)

Truist Financial Corporation 39


December 31, 2023 (Dollars in millions)	Total		Level 1		Level 2		Level 3		Netting Adjustments(1)
Assets:
Trading assets:
U.S. Treasury	$	144	$	—	$	144	$	—	$	—
GSE	50		—		50		—		—


States and political subdivisions	760		—		760		—		—

Corporate and other debt securities	1,293		—		1,293		—		—
Loans	1,575		—		1,575		—		—
Equity securities	181		181		—		—		—
Other	329		280		49		—		—
Total trading assets	4,332		461		3,871		—		—
AFS securities:
U.S. Treasury	10,041		—		10,041		—		—
GSE	362		—		362		—		—
Agency MBS – residential	51,289		—		51,289		—		—
Agency MBS – commercial	2,248		—		2,248		—		—
States and political subdivisions	425		—		425		—		—
Non-agency MBS	2,981		—		2,981		—		—
Other	20		—		20		—		—
Total AFS securities	67,366		—		67,366		—		—
LHFS at fair value	852		—		852		—		—
Loans and leases	15		—		—		15		—
Loan servicing rights at fair value	3,378		—		—		3,378		—
Other assets:
Derivative assets	951		956		1,867		5		(1,877)
Equity securities	360		245		115		—		—

Total assets	$	77,254	$	1,662	$	74,071	$	3,398	$	(1,877)
Liabilities:


Short-term borrowings:
Securities sold short	$	1,625	$	185	$	1,440	$	—	$	—
Other liabilities:
Derivative liabilities	2,597		487		4,171		24		(2,085)
Total liabilities	$	4,222	$	672	$	5,611	$	24	$	(2,085)

(1)Refer to “Note 16. Derivative Financial Instruments” for additional discussion on netting adjustments.

At September 30, 2024 and December 31, 2023, investments totaling $495 million and $459 million, respectively, have been excluded from the table above as they are valued based on net asset value as a practical expedient. These investments primarily consist of certain SBIC funds.

The following discussion focuses on the valuation techniques and significant inputs for brokered time deposit liabilities that are measured at fair value on a recurring basis. For additional information on the valuation techniques and significant inputs for Level 2 and Level 3 assets and liabilities that are measured at fair value on a recurring basis, see “Note 18. Fair Value Disclosures” of the Annual Report on Form 10-K for the year ended December 31, 2023.

Brokered time deposits: The Company has elected to measure certain CDs that contain embedded derivatives at fair value. This fair value election better aligns the economics of the CDs with the Company’s risk management strategies. The Company elects, on an instrument by instrument basis, whether a new issuance will be measured at fair value. The Company has classified CDs measured at fair value as level 2 instruments due to the Company’s ability to observe all significant inputs to model-derived valuations in active markets. The Company employs a discounted cash flow approach based on observable market interest rates for the term of the CD and an estimate of the Bank’s credit risk. For any embedded derivative features, the Company uses the same valuation methodologies as if the derivative were a standalone derivative, as discussed in the “Derivative assets and liabilities” section in “Note 18. Fair Value Disclosures” of the Annual Report on Form 10-K for the year ended December 31, 2023.

40 Truist Financial Corporation

Activity for Level 3 assets and liabilities is summarized below:




Three Months Ended September 30, 2024 and 2023 (Dollars in millions)	Loans and Leases		Loan Servicing Rights		Net Derivatives
Balance at July 1, 2023	$	16	$	3,497	$	(31)
Total realized and unrealized gains (losses):
Included in earnings	—		151		(25)


Issuances	—		78		1
Sales	—		(102)		—
Settlements	—		(87)		16


Balance at September 30, 2023	$	16	$	3,537	$	(39)
Balance at July 1, 2024	$	14	$	3,410	$	(20)
Total realized and unrealized gains (losses):
Included in earnings	—		(109)		(4)

Purchases	—		230		—
Issuances	—		50		17

Settlements	(1)		(82)		(26)


Balance at September 30, 2024	$	13	$	3,499	$	(33)
Change in unrealized gains (losses) included in earnings for the period, attributable to assets and liabilities still held at September 30, 2024	$	—	$	(109)	$	(15)

Nine Months Ended September 30, 2024 and 2023 (Dollars in millions)	Loans and Leases		Loan Servicing Rights		Net Derivatives













Balance at January 1, 2023	$	18	$	3,758	$	(36)
Total realized and unrealized gains (losses):
Included in earnings	—		216		(47)

Purchases	—		123		—
Issuances	—		218		17
Sales	—		(531)		—
Settlements	(2)		(247)		27




Balance at September 30, 2023	$	16	$	3,537	$	(39)
Balance at January 1, 2024	$	15	$	3,378	$	(19)
Total realized and unrealized gains (losses):
Included in earnings	—		3		(11)

Purchases	—		230		—
Issuances	—		134		28
Sales	—		(2)		—
Settlements	(2)		(244)		(31)



Balance at September 30, 2024	$	13	$	3,499	$	(33)
Change in unrealized gains (losses) included in earnings for the period, attributable to assets and liabilities still held at September 30, 2024	$	—	$	2	$	(23)
Primary income statement location of realized gains (losses) included in earnings	Other income		Mortgage banking income		Mortgage banking income

Fair Value Option

The following table details the fair value and UPB of certain loans and time deposits that were elected to be measured at fair value:


	September 30, 2024						December 31, 2023
(Dollars in millions)	Fair Value		UPB		Difference		Fair Value		UPB		Difference
Trading loans	$	1,574	$	1,624	$	(50)	$	1,575	$	1,664	$	(89)
Loans and leases	13		14		(1)		15		16		(1)
LHFS at fair value	1,028		1,006		22		852		828		24
Brokered time deposits	99		100		(1)		—		—		—

Truist Financial Corporation 41

Nonrecurring Fair Value Measurements

The following table provides information about certain assets measured at fair value on a nonrecurring basis still held as of period end. The carrying values represent end of period values, which approximate the fair value. These assets are considered to be Level 3 assets.


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
Carrying value:
LHFS	$	6	$	19
Loans and leases	695		840
Other	159		454

The following table provides information about valuation adjustments for certain assets measured at fair value on a nonrecurring basis. The valuation adjustments represent the amounts recorded during the period regardless of whether the asset is still held at period end.


	Nine Months Ended September 30,
(Dollars in millions)	2024		2023
Valuation adjustments:
LHFS	$	(17)	$	(40)
Loans and leases	(808)		(428)
Other	(234)		(198)

LHFS with valuation adjustments in the table above consisted primarily of residential mortgages and commercial loans that were valued using market prices and measured at LOCOM. The table above excludes $244 million and $409 million of LHFS carried at cost at September 30, 2024 and December 31, 2023, respectively, that did not require a valuation adjustment during the period. The remainder of LHFS is carried at fair value.

Loans and leases consist of larger commercial loans and leases that are collateral-dependent and other secured loans and leases that have been charged-off to the fair value of the collateral. Valuation adjustments for loans and leases are primarily recorded in the Provision for credit losses in the Consolidated Statement of Income. Refer to “Note 1. Basis of Presentation” in Truist’s Annual Report on Form 10-K for the year ended December 31, 2023 for additional discussion of individually evaluated loans and leases.

Other includes foreclosed real estate, other foreclosed property, partnership investments, premises and equipment, OREO, and held for sale operating leases, and consists primarily of residential homes, commercial properties, vacant lots, and automobiles. Partnership investments are measured based on discounted expected future cash flows. The remaining assets are measured at LOCOM, less costs to sell.

Financial Instruments Not Recorded at Fair Value

For financial instruments not recorded at fair value, estimates of fair value are based on relevant market data and information about the instruments. Values obtained relate to trading without regard to any premium or discount that may result from concentrations of ownership, possible tax ramifications, estimated transaction costs that may result from bulk sales, or the relationship between various instruments.

An active market does not exist for certain financial instruments. Fair value estimates for these instruments are based on current economic conditions and interest rate risk characteristics, loss experience, and other factors. Many of these estimates involve uncertainties and matters of significant judgment and cannot be determined with precision. Therefore, the fair value estimates in many instances cannot be substantiated by comparison to independent markets. In addition, changes in assumptions could significantly affect these fair value estimates. Financial assets and liabilities not recorded at fair value are summarized below:


		September 30, 2024				December 31, 2023
(Dollars in millions)	Fair Value Hierarchy	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Financial assets:
HTM securities	Level 2	$	51,495	$	43,229	$	54,107	$	44,630
Loans and leases HFI, net of ALLL	Level 3	298,229		295,020		307,248		300,830
Financial liabilities:
Time deposits	Level 2	37,853		37,769		43,561		43,368
Long-term debt	Level 2	36,770		37,082		38,918		38,353

The carrying value of the RUFC, which approximates the fair value of unfunded commitments, was $298 million and $295 million at September 30, 2024 and December 31, 2023, respectively.

42 Truist Financial Corporation

NOTE 16. Derivative Financial Instruments

Impact of Derivatives on the Consolidated Balance Sheets

The following table presents the gross notional amounts and estimated fair value of derivative instruments employed by the Company:


	September 30, 2024								December 31, 2023
	Notional Amount			Fair Value					Notional Amount		Fair Value
(Dollars in millions)			Assets			Liabilities			Assets		Liabilities
Cash flow hedges:
Interest rate contracts:

Swaps hedging commercial loans	$	49,614		$	1		$	—	$	17,673	$	—	$	—
Fair value hedges:
Interest rate contracts:
Swaps hedging long-term debt	9,518			—			—		14,268		—		—


Swaps hedging AFS securities	15,823			1			—		24,178		—		—
Swaps hedging U.S. Treasury	980			—			—		—		—		—
Total	26,321			1			—		38,446		—		—
Not designated as hedges:
Client-related and other risk management:
Interest rate contracts:
Swaps	149,463			642			(1,263)		154,692		637		(1,926)
Options	23,125			50			(43)		34,593		114		(106)
Forward commitments	1,687			2			(6)		178		—		(11)
Other	3,495			2			(1)		3,033		—		—
Equity contracts	43,013			1,842			(2,508)		39,561		1,164		(1,733)
Credit contracts:
Trading assets	340			—			—		100		—		—
Loans and leases	325			—			—		225		—		—
Risk participation agreements	7,228			—			(2)		7,499		—		(3)
Total return swaps	1,341			37			(4)		1,598		41		(7)
Foreign exchange contracts	25,311			270			(252)		24,480		256		(256)
Commodity	10,528			387			(372)		8,367		513		(503)
Total	265,856			3,232			(4,451)		274,326		2,725		(4,545)
Mortgage banking:
Interest rate contracts:
Swaps	200			—			—		105		—		—
Options	400			1			—		400		3		—
Interest rate lock commitments	1,279			4			(5)		746		5		(10)
When issued securities, forward rate agreements and forward commitments	1,826			7			(5)		1,438		12		(17)
Other	101			—			—		94		—		—

Total	3,806			12			(10)		2,783		20		(27)
MSRs:
Interest rate contracts:
Swaps	19,223			1			—		15,252		—		—
Options	12,842			50			(136)		14,854		75		(109)
When issued securities, forward rate agreements and forward commitments	2,744			12			(8)		933		8		—
Other	2,173			2			(1)		1,692		—		(1)
Total	36,982			65			(145)		32,731		83		(110)
Total derivatives not designated as hedges	306,644			3,309			(4,606)		309,840		2,828		(4,682)
Total derivatives	$	382,579		3,311			(4,606)		$	365,959	2,828		(4,682)
Gross amounts in the Consolidated Balance Sheets:
Amounts subject to master netting arrangements and exchange traded derivatives				(1,601)			1,601				(1,268)		1,268
Cash collateral (received) posted for amounts subject to master netting arrangements				(369)			1,093				(609)		817

Net amount				$	1,341		$	(1,912)			$	951	$	(2,597)

Truist Financial Corporation 43

The following table presents the offsetting of derivative instruments including financial instrument collateral related to legally enforceable master netting agreements and amounts held or pledged as collateral. U.S. GAAP does not permit netting of non-cash collateral balances in the Consolidated Balance Sheets:


September 30, 2024 (Dollars in millions)	Gross Amount		Amount Offset		Net Amount in Consolidated Balance Sheets		Held/Pledged Financial Instruments		Net Amount
Derivative assets:
Derivatives subject to master netting arrangement or similar arrangement	$	1,590	$	(1,175)	$	415	$	—	$	415
Derivatives not subject to master netting arrangement or similar arrangement	188		—		188		—		188
Exchange traded derivatives	1,533		(795)		738		—		738
Total derivative assets	$	3,311	$	(1,970)	$	1,341	$	—	$	1,341
Derivative liabilities:
Derivatives subject to master netting arrangement or similar arrangement	$	(3,182)	$	1,899	$	(1,283)	$	150	$	(1,133)
Derivatives not subject to master netting arrangement or similar arrangement	(628)		—		(628)		—		(628)
Exchange traded derivatives	(796)		795		(1)		—		(1)
Total derivative liabilities	$	(4,606)	$	2,694	$	(1,912)	$	150	$	(1,762)

December 31, 2023 (Dollars in millions)	Gross Amount		Amount Offset		Net Amount in Consolidated Balance Sheets		Held/Pledged Financial Instruments		Net Amount
Derivative assets:
Derivatives subject to master netting arrangement or similar arrangement	$	1,775	$	(1,392)	$	383	$	—	$	383
Derivatives not subject to master netting arrangement or similar arrangement	97		—		97		—		97
Exchange traded derivatives	956		(485)		471		—		471
Total derivative assets	$	2,828	$	(1,877)	$	951	$	—	$	951
Derivative liabilities:
Derivatives subject to master netting arrangement or similar arrangement	$	(3,627)	$	1,600	$	(2,027)	$	151	$	(1,876)
Derivatives not subject to master netting arrangement or similar arrangement	(568)		—		(568)		—		(568)
Exchange traded derivatives	(487)		485		(2)		—		(2)
Total derivative liabilities	$	(4,682)	$	2,085	$	(2,597)	$	151	$	(2,446)

The following table presents the carrying value of hedged items in fair value hedging relationships:


	September 30, 2024						December 31, 2023
			Hedge Basis Adjustment						Hedge Basis Adjustment
(Dollars in millions)	Hedged Asset / Liability Basis		Items Currently Designated		Discontinued Hedges		Hedged Asset / Liability Basis		Items Currently Designated		Discontinued Hedges
AFS securities(1)(2)	$	29,391	$	378	$	16	$	51,782	$	6	$	(5)
Loans and leases	308		—		5		322		—		7

Long-term debt	30,165		(5)		(462)		27,572		(237)		(475)

(1)The amortized cost of AFS securities was $34.1 billion at September 30, 2024 and $62.2 billion at December 31, 2023. Further, as of September 30, 2024, closed portfolios of securities hedged under the portfolio layer method have an amortized cost of $31.9 billion, of which $15.8 billion was designated as hedged. The remaining amount of amortized cost is from securities with terminated hedges where the basis adjustment is being amortized into earnings using the effective interest method over the contractual life of the security and hedges not designated under the portfolio-layer method.

(2)The decline in hedged AFS securities from December 31, 2023 to September 30, 2024 was due to the balance sheet repositioning in May 2024. Refer to “Note 4. Investment Securities” for additional information.

44 Truist Financial Corporation

Impact of Derivatives on the Consolidated Statements of Income and Comprehensive Income

Derivatives Designated as Hedging Instruments under GAAP

No portion of the change in fair value of derivatives designated as hedges has been excluded from effectiveness testing.

The following table summarizes amounts related to cash flow hedges, which consist of interest rate contracts:


	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	2024		2023		2024		2023
Pre-tax gain (loss) recognized in OCI:
Commercial loans	$	557	$	(351)	$	125	$	(607)




Pre-tax gain (loss) reclassified from AOCI into interest expense or interest income:




Commercial Loans	(108)		(17)		(242)		(22)

The following table summarizes the impact on net interest income related to fair value hedges:


	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	2024		2023		2024		2023
Investment securities:
Amounts related to interest settlements	$	86	$	119	$	368	$	282
Recognized on derivatives	(535)		326		101		273
Recognized on hedged items	547		(323)		(74)		(248)
Net income (expense) recognized(1)	98		122		395		307
Loans and leases:


Recognized on hedged items	(1)		(1)		(2)		(2)






Long-term debt:
Amounts related to interest settlements	(71)		(56)		(161)		(149)
Recognized on derivatives	472		(319)		177		(454)
Recognized on hedged items	(496)		326		(244)		483
Net income (expense) recognized	(95)		(49)		(228)		(120)
Net income (expense) recognized, total	$	2	$	72	$	165	$	185

(1)Includes $10 million and $30 million of income recognized for the three and nine months ended September 30, 2024, respectively, and $12 million and $33 million for the three and nine months ended September 30, 2023, respectively, from securities with terminated hedges that were reclassified to HTM. The income recognized was offset by the amortization of the fair value mark.

Truist Financial Corporation 45

The following table presents information about the Company’s cash flow and fair value hedges:


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
Cash flow hedges:
Net unrecognized after-tax gain (loss) on active hedges recorded in AOCI	$	132	$	(106)
Net unrecognized after-tax gain (loss) on terminated hedges recorded in AOCI (to be recognized in earnings through 2029)	(152)		(194)
Estimated portion of net after-tax gain (loss) on active and terminated hedges to be reclassified from AOCI into earnings during the next 12 months	(115)		(203)
Maximum time period over which Truist is hedging a portion of the variability in future cash flows for forecasted transactions excluding those transactions relating to the payment of variable interest on existing instruments	5 years		5 years
Fair value hedges:
Unrecognized pre-tax net gain (loss) on terminated hedges(1)	$	(100)	$	(64)
Portion of pre-tax net gain (loss) on terminated hedges to be recognized as a change in interest during the next 12 months	(86)		(60)

(1)Includes deferred gains that are recorded in AOCI as a result of the reclassification to HTM of previously hedged securities of $383 million at September 30, 2024 and $413 million at December 31, 2023.

Derivatives Not Designated as Hedging Instruments under GAAP

The Company also enters into derivatives that are not designated as accounting hedges under GAAP to economically hedge certain risks as well as in a trading capacity with its clients.

The following table presents pre-tax gain (loss) recognized in income for derivative instruments not designated as hedges:


		Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	Income Statement Location	2024		2023		2024		2023
Client-related and other risk management:
Interest rate contracts	Investment banking and trading income and other income	$	(16)	$	37	$	50	$	123
Foreign exchange contracts	Investment banking and trading income and other income	(72)		118		29		89
Equity contracts	Investment banking and trading income and other income	34		(14)		24		(34)
Credit contracts	Investment banking and trading income and other income	(9)		(33)		(19)		(92)
Commodity contracts	Investment banking and trading income	3		3		9		20
Mortgage banking:
Interest rate contracts – residential	Mortgage banking income	(34)		39		(35)		61
Interest rate contracts – commercial	Mortgage banking income	—		—		—		(1)
MSRs:
Interest rate contracts – residential	Mortgage banking income	84		(162)		(30)		(244)
Interest rate contracts – commercial	Mortgage banking income	14		(9)		7		(13)
Total		$	4	$	(21)	$	35	$	(91)

46 Truist Financial Corporation

Credit Derivative Instruments

As part of the Company’s corporate and investment banking business, the Company enters into contracts that are, in form or substance, written guarantees; specifically, risk participations, TRS, and credit default swaps. The Company accounts for these contracts as derivatives.

Truist has entered into risk participation agreements to share the credit exposure with other financial institutions on client-related interest rate derivative contracts. Under these agreements, the Company has guaranteed payment to a dealer counterparty in the event the counterparty experiences a loss on the derivative due to a failure to pay by the counterparty’s client. The Company manages its payment risk on its risk participations by monitoring the creditworthiness of the underlying client through the normal credit review process that the Company would have performed had it entered into a derivative directly with the obligors. At September 30, 2024, the remaining terms on these risk participations ranged from less than one year to 10 years. The potential future exposure represents the Company’s maximum estimated exposure to written risk participations, as measured by projecting a maximum value of the guaranteed derivative instruments based on scenario simulations and assuming 100% default by all obligors on the maximum value.

The Company has also entered into TRS contracts on loans and bonds. To mitigate its credit risk, the Company typically receives initial margin from the counterparty upon entering into the TRS and variation margin if the fair value of the underlying reference assets deteriorates. For additional information on the Company’s TRS contracts, see “Note 14. Commitments and Contingencies.”

The Company enters into credit default swaps to hedge credit risk associated with certain loans and leases. The Company accounts for these contracts as derivatives, and accordingly, recognizes these contracts at fair value.

The following table presents additional information related to interest rate derivative risk participation agreements and total return swaps:


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
Risk participation agreements:


Maximum potential amount of exposure	$	402	$	520
Total return swaps:

Cash and other collateral received	311		437

The following table summarizes collateral positions with counterparties:


(Dollars in millions)	Sep 30, 2024		Dec 31, 2023
Dealer and other counterparties:
Cash and other collateral received from counterparties	$	489	$	609
Derivatives in a net gain position secured by collateral received	468		735
Unsecured positions in a net gain with counterparties after collateral postings	92		126
Cash collateral posted to counterparties	1,247		960
Derivatives in a net loss position secured by collateral	1,332		1,052

Central counterparties clearing:

Cash collateral, including initial margin, posted to central clearing parties	14		14
Derivatives in a net loss position	—		8
Derivatives in a net gain position	12		2
Securities pledged to central counterparties clearing	492		1,249

Truist Financial Corporation 47

NOTE 17. Computation of EPS

Basic and diluted EPS calculations are presented in the following table:


	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions, except per share data, shares in thousands)	2024		2023		2024		2023
Net income (loss) available to common shareholders from continuing operations	$	1,333	$	1,003	$	(1,623)	$	3,404
Net income available to common shareholders from discontinued operations	3		68		4,876		311
Net income available to common shareholders	$	1,336	$	1,071	$	3,253	$	3,715
Weighted average number of common shares	1,334,212		1,333,522		1,335,812		1,331,377
Effect of dilutive outstanding equity-based awards(1)	14,917		7,052		—		7,664
Weighted average number of diluted common shares	1,349,129		1,340,574		1,335,812		1,339,041
Basic earnings from continuing operations	$	1.00	$	0.75	$	(1.21)	$	2.56
Basic earnings from discontinued operations	—		0.05		3.65		0.23
Basic EPS	$	1.00	$	0.80	$	2.44	$	2.79
Diluted earnings from continuing operations	$	0.99	$	0.75	$	(1.21)	$	2.54
Diluted earnings from discontinued operations	—		0.05		3.65		0.23
Diluted EPS	$	0.99	$	0.80	$	2.44	$	2.77
Anti-dilutive awards	—		5,875		12,945		4,665

(1)For periods ended with a net loss available to common shareholders from continuing operations, the calculation of GAAP diluted EPS uses the basic weighted average shares outstanding.

NOTE 18. Operating Segments

Following the segment realignment, Truist operates and measures business activity across two segments: CSBB and WB, with functional activities included in OT&C. The Company’s business segment structure is based on the manner in which financial information is evaluated by management as well as the products and services provided or the type of client served.

On February 20, 2024, the Company entered into an agreement to sell the remaining stake of the common equity in TIH to an investor group, representing substantially all of the Company’s IH segment, which represented a material strategic shift for the Company, and as a result, the Company recast results for all periods presented under the discontinued operations basis of presentation. On May 6, 2024, the Company completed the sale of its remaining equity interests in TIH. TIH was the principal legal entity of the IH segment. As the operations of TIH were included in discontinued operations prior to the sale of TIH, the Company no longer presents the IH segment as one of its reportable segments. Refer to “Note 2. Discontinued Operations” for additional information related to discontinued operations.

Consumer and Small Business Banking

CSBB serves consumer and small business clients, providing deposits and payment services, credit cards, loans, and mortgages through an extensive network of branches, ATMs, digital channels, contact centers, and other channels. Lending solutions include personal and unsecured loans originated through the branch network and digital channels; indirect lending services providing a comprehensive set of technology-enabled consumer lending solutions including point-of-sale offerings for autos, recreational vehicles, outdoor power sports, outdoor power equipment, and home improvement; and real estate lending providing residential mortgages through its retail, direct, and correspondent channels, with the loans either sold in the secondary market, typically with servicing rights retained, or held in the Company’s loan portfolio, and home equity loans delivered through the branch network. CSBB also serves as an entry point for clients to access services from other businesses.

48 Truist Financial Corporation

Wholesale Banking

WB segment delivers a comprehensive suite of tailored solutions with specialized product and industry expertise delivered through local coverage of corporate, commercial, and real estate clients combined with national coverage from investment banking and CRE businesses. This segment is focused on providing core banking, cash management, payments, specialized lending, investment banking, capital markets, strategic advisory, and market-making. In addition to the services provided by Truist’s SEC registered investment advisors, Truist’s wealth professionals provide asset management, trust, brokerage, and investment-related services, institutional investment management, full-service, and online/discount brokerage products, family office services, as well as other wealth management disciplines.

Other, Treasury & Corporate

OT&C includes management of the Company’s investment securities portfolio, long-term debt, derivative instruments used for balance sheet hedging, short-term liquidity and funding activities, balance sheet risk management and most bank-owned real estate assets, as well as the Company’s functional activities such as finance, enterprise risk, legal, and enterprise technology and management, among others. Additionally, OT&C houses intercompany eliminations, including intersegment net referral fees and residual interest rate risk.

Truist promotes revenue growth through the Company’s Integrated Relationship Management approach, which is designed to deepen client relationships and bring the full breadth and depth of Truist’s products and services to meet clients’ financial needs. The objective is to provide Truist’s entire suite of products to its clients with the end goal of providing clients the best financial experience in the marketplace. Revenues of certain products and services are reflected in the results of the segment providing those products and services and are also allocated to CSBB and WB. These allocated revenues between segments are reflected as net referral fees in noninterest income and eliminated in OT&C.

The segment results are presented based on internal management methodologies that were designed to support these strategic objectives. Unlike financial accounting, there is no comprehensive authoritative body of guidance for management accounting equivalent to GAAP. The performance of the segments is not comparable with Truist’s consolidated results or with similar information presented by any other financial institution. Additionally, because of the interrelationships between the various segments, the information presented is not indicative of how the segments would perform if they operated as independent entities.

Because business segment results are presented based on management accounting practices, the transition to the consolidated results prepared under U.S. GAAP creates certain differences, which are reflected as residuals in OT&C. Business segment reporting conventions include the items as detailed below.

Segment net interest income reflects matched maturity funds transfer pricing, which ascribes credits or charges based on the economic value or cost created by assets and liabilities of each segment. Residual differences between these credits and charges are captured in OT&C.

Noninterest income includes inter-segment referral fees, as well as federal and state tax credits that are grossed up on a pre-tax equivalent basis, related primarily to certain community development investments. Recoveries for these allocations are reported in OT&C.

Corporate expense allocations, including overhead or functional expenses that are not directly charged to the segments, are allocated to segments based on various drivers (number of FTEs, number of accounts, loan balances, net revenue, etc.). Recoveries for these allocations are reported in OT&C. In the third quarter of 2024, the Company’s corporate expense allocation methodology was enhanced to allocate certain overhead or functional expenses based on actual OT&C noninterest expense performance. Prior period results have been revised for the CSBB, WB, and OT&C segments to conform to the current allocation methodology.

Provision for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision attributable to each segment’s quarterly change in the ALLL. Provision for income taxes is calculated using a blended income tax rate for each segment and includes reversals of the noninterest income tax adjustments described above. The difference between the calculated provision for income taxes at the segment level and the consolidated provision for income taxes is reported in OT&C.

The application and development of management reporting methodologies is an active process and undergoes periodic enhancements. The implementation of these enhancements to the internal management reporting methodology may materially affect the results disclosed for each segment, with no impact on consolidated results. When significant changes to management reporting methodologies take place, the impact of these changes is quantified and prior period information is revised as practicable.

Truist Financial Corporation 49

The following table presents results by segment:


Three Months Ended September 30, (Dollars in millions)	CSBB						WB					OT&C(1)					Total
2024			2023			2024			2023				2024			2023			2024			2023
Net interest income (expense)	$	1,344		$	1,371		$	2,105		$	2,321			$	153		$	(157)		$	3,602		$	3,535
Net intersegment interest income (expense)	1,302			1,242			(460)			(613)				(842)			(629)			—			—
Segment net interest income	2,646			2,613			1,645			1,708				(689)			(786)			3,602			3,535
Allocated provision for credit losses	353			259			96			243				(1)			(5)			448			497
Segment net interest income after provision	2,293			2,354			1,549			1,465				(688)			(781)			3,154			3,038
Noninterest income	506			433			1,047			897				(70)			4			1,483			1,334
Amortization of intangibles	45			52			39			46				—			—			84			98
Other noninterest expense	1,618			1,652			1,197			1,307				28			3			2,843			2,962
Income (loss) before income taxes from continuing operations	1,136			1,083			1,360			1,009				(786)			(780)			1,710			1,312
Provision (benefit) for income taxes	271			260			275			194				(275)			(251)			271			203
Segment net income (loss) from continuing operations	$	865		$	823		$	1,085		$	815			$	(511)		$	(529)		$	1,439		$	1,109

Identifiable assets (period end) of continuing operations	$	144,285		$	153,412		$	205,584		$	212,703			$	173,565		$	169,119		$	523,434		$	535,234

Nine Months Ended September 30, (Dollars in millions)	CSBB						WB					OT&C(1)					Total
2024			2023			2024			2023				2024			2023			2024			2023
Net interest income (expense)	$	3,899		$	4,606		$	6,522		$	6,869			$	80		$	(470)		$	10,501		$	11,005
Net intersegment interest income (expense)	3,991			3,340			(1,510)			(1,576)				(2,481)			(1,764)			—			—
Segment net interest income	7,890			7,946			5,012			5,293				(2,401)			(2,234)			10,501			11,005
Allocated provision for credit losses	965			756			436			787				(2)			(6)			1,399			1,537
Segment net interest income after provision	6,925			7,190			4,576			4,506				(2,399)			(2,228)			9,102			9,468
Noninterest income	1,513			1,496			3,010			2,724				(6,806)			(85)			(2,283)			4,135
Amortization of intangibles	136			158			122			139				3			—			261			297
Other noninterest expense	4,775			4,980			3,714			3,934				224			(90)			8,713			8,824
Income (loss) before income taxes from continuing operations	3,527			3,548			3,750			3,157				(9,432)			(2,223)			(2,155)			4,482
Provision (benefit) for income taxes	846			847			749			619				(2,416)			(672)			(821)			794
Segment net income (loss) from continuing operations	$	2,681		$	2,701		$	3,001		$	2,538			$	(7,016)		$	(1,551)		$	(1,334)		$	3,688

Identifiable assets (period end) of continuing operations	$	144,285		$	153,412		$	205,584		$	212,703			$	173,565		$	169,119		$	523,434		$	535,234

(1)Includes financial data from business units below the quantitative and qualitative thresholds requiring disclosure.

50 Truist Financial Corporation

Previous: Cover and table of contents · Next: Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS