Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MD&A is intended to assist readers in their analysis of the accompanying Consolidated Financial Statements and supplemental financial information. It should be read in conjunction with the Consolidated Financial Statements, the accompanying Notes to the Consolidated Financial Statements in this Form 10-Q, other information contained in this document, as well as with Truist’s Annual Report on Form 10-K for the year ended December 31, 2024.

A description of certain factors that may affect our future results and risk factors is set forth in Part I, Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024.

Executive Overview

We delivered strong second-quarter results, driven by strategic loan growth and higher net interest income derived from continued strong production from our business. Our performance reflects the value of our client-centric business model and momentum in our strategy, as we see tangible results from investments we have made in talent and technology across our platforms.

Asset quality remained strong, and our capital position continues to support both our growth initiatives and our ability to return capital to shareholders. We returned $1.4 billion of capital to our common shareholders through $670 million of common stock dividends and $750 million of common share repurchases during the second quarter of 2025. As of June 30, 2025, we had $2.8 billion remaining under our $5.0 billion common share repurchase authorization through the end of 2026.

Financial Results

Net income available to common shareholders for the second quarter of 2025 of $1.2 billion was up 43% compared with the second quarter of 2024. On a diluted per common share basis, earnings for the second quarter of 2025 were $0.90, an increase of $0.28, or 45%, compared to the second quarter of 2024. Truist’s results of operations for the second quarter of 2025 produced an annualized return on average assets of 0.93% and an annualized return on average common shareholders’ equity of 8.1% compared to prior year returns of 0.70% and 6.1%, respectively.

Net income from continuing operations was $1.2 billion for the second quarter of 2025, compared to a net loss from continuing operations of $3.9 billion for the second quarter of 2024.

Results from continuing operations for the second quarter of 2025 included restructuring charges of $28 million ($21 million after-tax, or $0.02 per share) and securities losses of $18 million ($13 million after-tax, or $0.01 per share).
Results from continuing operations for the second quarter of 2024 included securities losses of $6.7 billion ($5.1 billion after-tax, or $3.80 per share) from the strategic balance sheet repositioning of a portion of the available-for-sale investment securities portfolio, a charitable contribution to the Truist Foundation of $150 million ($115 million after-tax, or $0.09 per share), and restructuring charges of $33 million ($26 million after-tax, or $0.02 per share).

TE net interest income for the second quarter of 2025 was up $55 million, or 1.5%, compared to the second quarter of 2024. Net interest margin was 3.02%, flat compared to the second quarter of 2024.

The yield on the average total loan portfolio was 6.01%, down 43 basis points due to the impact of variable rate loans repricing. The yield on the average securities portfolio was 3.16%, up 40 basis points, reflecting the balance sheet repositioning in the second quarter of 2024 and reinvesting cash flows into higher yielding securities.
The average cost of total deposits was 1.85%, down 24 basis points. The average cost of short-term borrowings was 4.47%, down 111 basis points. The average cost of long-term debt was 5.02%, up 15 basis points.

Noninterest income was up $6.6 billion for the second quarter of 2025 compared to the second quarter of 2024 primarily due to securities losses resulting from the balance sheet repositioning in 2024 and higher other income, partially offset by lower investment banking and trading income. Excluding securities losses, noninterest income was down $20 million, or 1.4%, compared to the second quarter of 2024.

Noninterest expense was down $108 million, or 3.5%, for the second quarter of 2025 compared to the second quarter of 2024 due to lower other expense and lower regulatory costs, partially offset by higher professional fees and outside processing expense. The second quarter of 2024 included a charitable contribution of $150 million (other expense) and a FDIC special assessment adjustment of $13 million (regulatory costs). Restructuring charges for both quarters include severance as well as costs associated with facilities optimization initiatives. Adjusted noninterest expense, which excludes the charitable contribution, the FDIC special assessment adjustment, and restructuring charges, increased $60 million, or 2.1%, compared to the earlier quarter.

48 Truist Financial Corporation

The second quarter of 2025 reflects a provision for income taxes while the second quarter of 2024 reflects a benefit for income taxes driven by the discrete impact of the balance sheet repositioning of securities.

Asset quality remained strong during the second quarter of 2025.

Nonperforming loans and leases held for investment were 0.39% of loans and leases held for investment at June 30, 2025, down nine basis points compared to March 31, 2025.
Loans 90 days or more past due and still accruing totaled $546 million at June 30, 2025, down three basis points as a percentage of loans and leases compared with March 31, 2025. Excluding government guaranteed loans, the ratio of loans 90 days or more past due and still accruing as a percentage of loans and leases was 0.04% at June 30, 2025, down one basis point compared to March 31, 2025.
The allowance for credit losses was $5.3 billion and included $4.9 billion for the allowance for loan and lease losses and $354 million for the reserve for unfunded commitments. The ALLL ratio was 1.54%, down four basis points from March 31, 2025.
The provision for credit losses was $488 million compared to $451 million for the second quarter of 2024, reflecting a higher allowance build.
The net charge-off ratio was 51 basis points, down seven basis points compared to the second quarter of 2024, primarily driven by lower net charge-offs in the CRE portfolio, partially offset by higher net charge-offs in the commercial and industrial portfolio.

Capital ratios remained strong during the second quarter of 2025.

Truist’s CET1 ratio was 11.0% as of June 30, 2025, down 30 basis points compared to March 31, 2025 due to capital returned to shareholders and an increase in risk-weighted assets, partially offset by current quarter earnings.
Truist declared common dividends of $0.52 per share during the second quarter of 2025 and repurchased $750 million of common stock. For the second quarter of 2025, the dividend payout ratio was 57%, and the total payout ratio was 121%.
Truist’s average consolidated LCR was 110% for the three months ended June 30, 2025, compared to the regulatory minimum of 100%.
Truist completed the 2025 CCAR process and received a preliminary SCB requirement of 2.5% for the period October 1, 2025 to September 30, 2026, down 30 basis points from the SCB requirement for the period October 1, 2024 to September 30, 2025. The FRB will provide Truist with its final SCB requirement by August 31, 2025.

Truist Financial Corporation 49

Analysis of Results of Operations

Net Interest Income and NIM

TE net interest income for the second quarter of 2025 was up $55 million, or 1.5%, compared to the second quarter of 2024. Net interest margin was 3.02%, flat compared to the second quarter of 2024.

Average earning assets increased $6.8 billion, or 1.4%, primarily due to an increase in average total loans of $6.3 billion, or 2.0%.
The yield on the average total loan portfolio was 6.01%, down 43 basis points due to the impact of variable rate loans repricing. The yield on the average securities portfolio was 3.16%, up 40 basis points, reflecting the balance sheet repositioning in the second quarter of 2024 and reinvesting cash flows into higher yielding securities.
Average deposits increased $12.4 billion, or 3.2%, and average long-term debt decreased $2.5 billion, or 6.8%.
The average cost of total deposits was 1.85%, down 24 basis points. The average cost of short-term borrowings was 4.47%, down 111 basis points. The average cost of long-term debt was 5.02%, up 15 basis points.

TE net interest income for the six months ended June 30, 2025 was up $185 million, or 2.6%, compared to the six months ended June 30, 2024 primarily due to the balance sheet repositioning in the second quarter of 2024. Net interest margin was 3.02%, up seven basis points compared to the prior period.

Average earning assets increased $3.3 billion, or 0.7%, compared to the prior period primarily due to an increase in other earning assets of $4.3 billion, or 12%, and an increase in average total loans of $2.2 billion, or 0.7%, partially offset by a decline in average securities of $3.8 billion, or 3.0%. The increase in average other earning assets and decrease in average securities primarily reflects the aforementioned balance sheet repositioning.
The yield on the average total loan portfolio was 5.99% for 2025, down 42 basis points, compared to the prior period primarily due to the impact of variable rate loans repricing. The yield on the average securities portfolio was 3.16% for 2025, up 56 basis points compared to the prior period, reflecting the balance sheet repositioning and reinvesting cash flows into higher yielding securities.
Average deposits increased $7.8 billion, or 2.0%, average short-term borrowings increased $2.2 billion, or 8.2%, and average long-term debt decreased $5.4 billion, or 14%.
The average cost of total deposits was 1.82% for 2025, down 24 basis points compared to the prior period. The average cost of short-term borrowings was 4.48% for 2025, down 112 basis points compared to the prior period. The average cost of long-term debt was 5.04% for 2025, up 24 basis points compared to the prior period.

The major components of net interest income and the related annualized yields as well as the variances between the periods caused by changes in interest rates versus changes in volumes are summarized below.

50 Truist Financial Corporation


Table 1-1: Taxable-Equivalent Net Interest Income and Rate / Volume Analysis
Three Months Ended June 30, (Dollars in millions)	Average Balances(1)						Annualized Yield/Rate(2)						Income/Expense(2)					Incr. (Decr.)		Change due to
2025			2024			2025			2024			2025			2024			Rate		Volume
Assets
AFS and HTM securities at amortized cost:
U.S. Treasury	$	14,034		$	11,138		5.20	%		3.66	%		$	181		$	101	$	80	$	49	$	31
GSE	463			382			3.73			3.27			5			3		2		—		2
Agency MBS	106,947			108,358			2.89			2.66			772			720		52		61		(9)
States and political subdivisions	370			420			4.20			4.14			4			5		(1)		—		(1)
Non-agency MBS	—			1,480			—			2.56			—			10		(10)		(5)		(5)
Other	15			18			4.53			5.29			—			—		—		—		—

Total securities	121,829			121,796			3.16			2.76			962			839		123		105		18
Interest earning trading assets	5,896			5,515			5.98			6.11			88			84		4		(2)		6
Other earning assets(3)	39,417			39,250			4.51			5.56			448			551		(103)		(105)		2
Loans and leases, net of unearned income:

Commercial and industrial	158,491			157,043			5.72			6.53			2,262			2,550		(288)		(312)		24
CRE	19,687			21,969			6.22			6.93			308			381		(73)		(37)		(36)
Commercial Construction	8,613			7,645			6.85			7.85			144			147		(3)		(21)		18


Residential mortgage	56,789			54,490			4.08			3.86			579			525		54		31		23
Home equity	9,586			9,805			7.47			8.02			178			195		(17)		(13)		(4)
Indirect auto	24,158			22,016			7.32			6.95			441			381		60		21		39
Other consumer	30,387			28,326			8.37			8.25			634			581		53		9		44

Credit card	4,890			4,905			11.35			12.14			139			148		(9)		(9)		—

Total loans and leases HFI	312,601			306,199			6.01			6.44			4,685			4,908		(223)		(331)		108
LHFS	1,240			1,384			6.15			6.56			19			22		(3)		(1)		(2)
Total loans and leases	313,841			307,583			6.01			6.44			4,704			4,930		(226)		(332)		106
Total earning assets	480,983			474,144			5.16			5.42			6,202			6,404		(202)		(334)		132
Nonearning assets	56,086			50,109
Assets of discontinued operations	—			2,641
Total assets	$	537,069		$	526,894
Liabilities and Shareholders’ Equity
Interest-bearing deposits:
Interest-checking	$	116,193		$	103,894		2.51			2.74			726			707		19		(62)		81
Money market and savings	135,607			135,264			2.22			2.60			751			873		(122)		(124)		2
Time deposits	41,997			41,250			3.50			4.24			367			436		(69)		(77)		8

Total interest-bearing deposits	293,797			280,408			2.52			2.89			1,844			2,016		(172)		(263)		91
Short-term borrowings	26,241			26,016			4.47			5.58			292			362		(70)		(73)		3
Long-term debt	34,213			36,721			5.02			4.87			431			446		(15)		14		(29)
Total interest-bearing liabilities	354,251			343,145			2.91			3.31			2,567			2,824		(257)		(322)		65
Noninterest-bearing deposits	106,686			107,634
Other liabilities	11,897			13,318
Liabilities of discontinued operations	—			1,120
Shareholders’ equity	64,235			61,677
Total liabilities and shareholders’ equity	$	537,069		$	526,894
Average interest-rate spread							2.25	%		2.11	%
NIM/net interest income - TE(2)							3.02	%		3.02	%		$	3,635		$	3,580	$	55	$	(12)	$	67
Less: TE adjustment													48			53
Net interest income													$	3,587		$	3,527
Memo: Total deposits	$	400,483		$	388,042		1.85	%		2.09	%		$	1,844		$	2,016	$	(172)

(1)Represents daily average balances. Unrealized gains and losses on available-for-sale securities are included in nonearning assets. Active hedge basis adjustments for fair value hedges are included in nonearning assets and other liabilities.

(2)Yields are stated on a TE basis, which represents a non-GAAP measure, utilizing a federal tax rate of 21%. Interest income includes certain fees, deferred costs, and dividends. The change in interest not solely due to changes in rate or volume has been allocated based on the pro-rata absolute dollar amount of each.

(3)Includes cash equivalents, interest-bearing deposits with banks, FHLB stock, and other earning assets.

Truist Financial Corporation 51




Table 1-2: Taxable-Equivalent Net Interest Income and Rate / Volume Analysis

Six Months Ended June 30, (Dollars in millions)	Average Balances(1)					Annualized Yield/Rate(2)						Income/Expense(2)							Incr. (Decr.)	Change due to
2025			2024			2025			2024				2025			2024					Rate		Volume
Assets
AFS and HTM securities at amortized cost:
U.S. Treasury	$	14,448		$	10,496		5.19	%		2.64	%			$	372		$	138			$	234	$	168	$	66
GSE	462			385			3.74			3.34				9			6				3		1		2
Agency MBS	107,643			112,828			2.88			2.58				1,549			1,455				94		163		(69)
States and political subdivisions	370			420			4.20			4.14				8			9				(1)		—		(1)
Non-agency MBS	—			2,578			—			2.87				—			37				(37)		(18)		(19)
Other	16			19			4.63			5.32				—			—				—		—		—

Total securities	122,939			126,726			3.16			2.60				1,938			1,645				293		314		(21)
Interest earning trading assets	5,763			5,180			5.85			6.29				168			163				5		(12)		17
Other earning assets(3)	39,208			34,909			4.52			5.60				889			987				(98)		(206)		108
Loans and leases, net of unearned income:

Commercial and industrial	156,861			157,714			5.71			6.53				4,446			5,122				(676)		(649)		(27)
CRE	19,759			22,185			6.17			6.94				610			770				(160)		(81)		(79)
Commercial Construction	8,673			7,389			6.84			7.84				289			284				5		(40)		45


Residential mortgage	56,226			54,780			4.06			3.85				1,141			1,053				88		59		29
Home equity	9,578			9,868			7.47			7.97				355			391				(36)		(25)		(11)
Indirect auto	23,705			22,195			7.26			6.82				853			753				100		49		51
Other consumer	29,843			28,306			8.35			8.12				1,236			1,142				94		32		62

Credit card	4,870			4,913			11.47			12.05				277			294				(17)		(14)		(3)

Total loans and leases HFI	309,515			307,350			5.99			6.41				9,207			9,809				(602)		(669)		67
LHFS	1,187			1,155			6.04			6.49				36			37				(1)		(2)		1
Total loans and leases	310,702			308,505			5.99			6.41				9,243			9,846				(603)		(671)		68
Total earning assets	478,612			475,320			5.14			5.33				12,238			12,641				(403)		(575)		172
Nonearning assets	55,753			48,516
Assets of discontinued operations	—			5,112
Total assets	$	534,365		$	528,948
Liabilities and Shareholders’ Equity
Interest-bearing deposits:
Interest-checking	$	112,720		$	103,716		2.44			2.70				1,366			1,391				(25)		(140)		115
Money market and savings	136,249			134,979			2.21			2.54				1,494			1,705				(211)		(227)		16
Time deposits	41,104			41,594			3.53			4.27				720			884				(164)		(154)		(10)

Total interest-bearing deposits	290,073			280,289			2.49			2.86				3,580			3,980				(400)		(521)		121
Short-term borrowings	28,275			26,123			4.48			5.60				628			728				(100)		(155)		55
Long-term debt	33,320			38,721			5.04			4.80				840			928				(88)		44		(132)
Total interest-bearing liabilities	351,668			345,133			2.89			3.28				5,048			5,636				(588)		(632)		44
Noninterest-bearing deposits	106,293			108,261
Other liabilities	12,269			13,101
Liabilities of discontinued operations	—			2,109
Shareholders’ equity	64,135			60,344
Total liabilities and shareholders’ equity	$	534,365		$	528,948
Average interest-rate spread							2.25	%		2.05	%
NIM/net interest income - TE(2)							3.02	%		2.95	%			$	7,190		$	7,005			$	185	$	57	$	128
Less: TE adjustment														96			106
Net interest income														$	7,094		$	6,899
Memo: Total deposits	$	396,366		$	388,550		1.82	%		2.06	%			$	3,580		$	3,980			$	(400)

(3)Includes cash equivalents, interest-bearing deposits with banks, FHLB stock, and other earning assets.

52 Truist Financial Corporation

Provision for Credit Losses

The provision for credit losses was $488 million for the second quarter of 2025 compared to $451 million for the second quarter of 2024. The net charge-off ratio for the current quarter of 0.51% was down seven basis points compared to the prior quarter.

*•*The increase in the current quarter provision expense primarily reflects a higher allowance build.

The net charge-off ratio for the current quarter was down compared to the second quarter of 2024 primarily driven by lower net charge-offs in the CRE portfolio, partially offset by higher net charge-offs in the commercial and industrial portfolio.

The provision for credit losses was $946 million for the six months ended June 30, 2025 compared to $951 million for the six months ended June 30, 2024. The net charge-off ratio for the current period of 0.55% was down six basis points compared to the prior period.

*•*The net charge-off ratio was down compared to the prior period driven by lower net charge-offs in the CRE portfolio, partially offset by higher net charge-offs in the commercial and industrial portfolio.

Refer to “Note 5. Loans and ACL” for additional discussion of the ACL.

Noninterest Income

Noninterest income is a significant contributor to Truist’s financial results. Management focuses on diversifying its sources of revenue to reduce Truist’s reliance on traditional spread-based interest income, as certain fee-based activities are a relatively stable revenue source during periods of changing interest rates. The following table provides a breakdown of Truist’s noninterest income:


Table 2: Noninterest Income
	Three Months Ended June 30,				% Change		Six Months Ended June 30,				% Change
(Dollars in millions)	2025		2024		2025 vs. 2024		2025		2024			2025 vs. 2024
Wealth management income	$	348	$	361	(3.6)	%	$	692	$	717		(3.5)	%
Investment banking and trading income	205		286		(28.3)		478		609			(21.5)
Card and payment related fees	232		230		0.9		452		454			(0.4)
Service charges on deposits	227		232		(2.2)		457		457			—
Mortgage banking income	107		112		(4.5)		215		209			2.9
Lending related fees	99		89		11.2		194		185			4.9
Operating lease income	47		50		(6.0)		100		109			(8.3)
Securities gains (losses)	(18)		(6,650)		(99.7)		(19)		(6,650)			(99.7)
Other income	153		78		96.2		223		144			54.9
Total noninterest income	$	1,400	$	(5,212)	NM		$	2,792	$	(3,766)		NM

Other income increased due to higher income from certain solar and other investments.
Investment banking and trading income decreased due to lower trading income and capital markets activity.

Noninterest income was up $6.6 billion for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 primarily due to securities losses resulting from the balance sheet repositioning in 2024 and higher other income, partially offset by lower investment banking and trading income and wealth management income. Excluding securities losses, noninterest income was down $73 million, or 2.5%, compared to the prior period.

Other income increased due to higher income from certain solar and other investments.
Investment banking and trading income decreased due to lower trading income, merger and acquisition fees, and capital markets activity.
Wealth management income decreased due to the impact of the sale of Sterling Capital Management LLC in 2024.

Truist Financial Corporation 53

Noninterest Expense

The following table provides a breakdown of Truist’s noninterest expense:


Table 3: Noninterest Expense
	Three Months Ended June 30,				% Change		Six Months Ended June 30,				% Change
(Dollars in millions)	2025		2024		2025 vs. 2024		2025		2024			2025 vs. 2024
Personnel expense	$	1,653	$	1,661	(0.5)	%	$	3,240	$	3,291		(1.5)	%
Professional fees and outside processing	373		308		21.1		737		586			25.8
Software expense	231		218		6.0		461		442			4.3
Net occupancy expense	179		160		11.9		342		320			6.9
Equipment expense	89		89		—		171		177			(3.4)
Amortization of intangibles	73		89		(18.0)		148		177			(16.4)
Marketing and customer development	82		63		30.2		157		119			31.9
Operating lease depreciation	33		34		(2.9)		68		74			(8.1)
Regulatory costs	55		85		(35.3)		124		237			(47.7)
Restructuring charges	28		33		(15.2)		66		84			(21.4)

Other expense	190		354		(46.3)		378		540			(30.0)
Total noninterest expense	$	2,986	$	3,094	(3.5)		$	5,892	$	6,047		(2.6)

Professional fees and outside processing expense increased due to higher investments in technology and risk infrastructure.

Noninterest expense was down $155 million, or 2.6%, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 primarily due to a $150 million charitable contribution to the Truist Foundation (other expense), the FDIC special assessment and related adjustments ($88 million for the six months ended June 30, 2024), lower personnel expense, and lower amortization of intangibles, partially offset by higher professional fees and outside processing expense. Restructuring charges decreased $18 million; both periods included restructuring charges for severance as well as facilities optimization costs. Adjusted noninterest expense, which excludes the charitable contribution, the FDIC special assessment adjustment, and restructuring charges, increased $101 million, or 1.8%.

Professional fees and outside processing expense increased due to higher investments in technology and risk infrastructure.
Personnel expense decreased due to lower employee benefit expense, partially offset by higher salaries.

Segment Results

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. Refer to “Note 18. Operating Segments” for additional information on the Company’s segments.


Table 4: Net Income from Continuing Operations by Reportable Segment
	Three Months Ended June 30,				% Change		Six Months Ended June 30,				% Change
(Dollars in millions)	2025		2024		2025 vs. 2024		2025		2024		2025 vs. 2024
Consumer and Small Business Banking	$	601	$	791	(24.0)	%	$	1,204	$	1,608	(25.1)	%
Wholesale Banking	936		960		(2.5)		1,822		1,826		(0.2)
Other, Treasury & Corporate	(297)		(5,657)		(94.7)		(525)		(6,207)		(91.5)
Truist Financial Corporation	$	1,240	$	(3,906)	NM		$	2,501	$	(2,773)	NM

54 Truist Financial Corporation

Consumer and Small Business Banking

CSBB net income was $601 million for the second quarter of 2025, a decrease of $190 million compared to the second quarter of 2024.

Segment net interest income decreased $148 million primarily driven by lower funding credit on deposits.
The allocated provision for credit losses increased $76 million reflecting an allowance build in the current period, partially offset by a decrease in charge-offs in the indirect auto portfolio.
Noninterest income increased $15 million primarily due to an increase in residential mortgage income driven by MSR valuations.
Noninterest expense increased $38 million compared to the earlier quarter driven by higher enterprise operations and functional support charges, partially offset by lower loan processing expense.

CSBB average loans and leases held for investment increased $6.0 billion, or 4.8%, for the second quarter of 2025 compared to the second quarter of 2024, primarily due to higher loan balances within indirect lending driven by the prime auto and Service Finance portfolios and within real estate lending driven by mortgage, partially offset by lower balances in the small business portfolio.

CSBB average total deposits increased $1.0 billion, or 0.5%, for the second quarter of 2025 compared to the second quarter of 2024, primarily driven by increases in money market and savings and noninterest-bearing deposits, partially offset by decreases in interest checking and time deposits.

Wholesale Banking

WB net income was $936 million for the second quarter of 2025, a decrease of $24 million compared to the second quarter of 2024.

Segment net interest income increased $38 million primarily due to higher deposit balances, partially offset by lower loan yields.
The allocated provision for credit losses decreased $38 million which reflects a decrease in both net charge-offs and net reserve build compared to the prior quarter.
Noninterest income decreased $44 million compared to the earlier quarter driven by lower trading income, capital markets activity, and commercial mortgage income, as well as decreases in wealth management income attributable to the sale of Sterling Capital Management LLC in 2024, partially offset by higher income from certain solar and other investments.
Noninterest expense increased $59 million compared to the earlier quarter primarily due to higher enterprise operations and functional support charges, partially offset by lower personnel expense from reduced incentives and lower regulatory costs.

WB average loans held for investment increased $391 million, or 0.2%, for the second quarter of 2025 compared to the second quarter of 2024, primarily due to increases in average commercial and industrial and commercial construction loan balances, partially offset by decreases in commercial real estate loan balances.

WB average total deposits increased $10.0 billion, or 7.1%, for the second quarter of 2025 compared to the second quarter of 2024, primarily due to specific client increases in interest checking balances, which were short-term in nature and withdrawn in July 2025, partially offset by declines in average noninterest-bearing deposits and money market and savings.

Other, Treasury & Corporate

OT&C generated a net loss of $297 million in the second quarter of 2025, compared to a net loss of $5.7 billion in the second quarter of 2024.

Segment net interest income increased $170 million primarily due to lower funding credit on deposits to other segments and increased yield in the securities portfolio due to the balance sheet repositioning in the second quarter of 2024 and reinvesting cash flows into higher yielding securities, partially offset by lower funding charges on commercial loans to other segments.
Noninterest income increased $6.6 billion primarily due to securities losses resulting from the balance sheet repositioning in 2024.
Noninterest expense decreased $205 million compared to the earlier quarter primarily due to lower other expense due to a charitable contribution to the Truist Foundation in 2024 and increased credit from other segments for technology project support, partially offset by increases in professional fees and outside processing.

Truist Financial Corporation 55

Consumer and Small Business Banking

CSBB net income was $1.2 billion for the six months ended June 30, 2025, a decrease of $404 million compared to the prior year.

Segment net interest income decreased $341 million primarily driven by lower funding credit on deposits.
The allocated provision for credit losses increased $91 million primarily reflecting a net reserve build in the current period compared to a release in the same period last year, partially offset by lower charge-offs in the other consumer and indirect auto portfolios.
Noninterest income increased $20 million primarily due to increased residential mortgage income.
Noninterest expense increased $115 million due to higher enterprise operations and functional support charges, partially offset by lower regulatory costs and loan processing expense.

CSBB average loans and leases held for investment increased $4.1 billion, or 3.3%, for the six months ended June 30, 2025 compared to the prior year driven primarily by increases in indirect auto loans, Service Finance, and mortgage loan balances, partially offset by decreases in the small business and unsecured and personal lending portfolios.

CSBB average total deposits decreased $278 million, or 0.1%, for the six months ended June 30, 2025 compared to the prior year primarily due to decreases in average interest-bearing checking and time deposits, partially offset by increases in money market and savings and noninterest-bearing deposits.

Wholesale Banking

WB net income was $1.8 billion for the six months ended June 30, 2025, flat compared to the prior year.

Segment net interest income increased $16 million primarily due to lower cost of deposits and higher funding credit driven by higher deposit balances, partially offset by lower loan balances and yields.
The allocated provision for credit losses decreased $94 million, which primarily reflects a decrease in net charge-offs as well as a decrease in the allowance build compared to the earlier period.
Noninterest income decreased $75 million primarily due to decreases in income from investment banking and trading as well as lower wealth management income driven by the impact of the sale of Sterling Capital Management LLC in 2024, partially offset by increased income from certain solar and other investments.
Noninterest expense increased $28 million primarily due to increases in enterprise operations and functional support charges, partially offset by lower regulatory costs, lower personnel expense from reduced incentives, and lower enterprise payments costs.

WB average loans and leases held for investment decreased $2.0 billion, or 1.1%, for the six months ended June 30, 2025 compared to the prior year driven by decreases in average commercial real estate balances and commercial and industrial loan balances, partially offset by increases in the commercial construction portfolio.

WB average total deposits increased $6.4 billion, or 4.6%, for the six months ended June 30, 2025 compared to the prior year primarily due to specific client increases in average interest-bearing checking balances, which were short-term in nature and withdrawn in July 2025, partially offset by decreases in noninterest-bearing deposits and money market and savings balances.

Other, Treasury, and Corporate

OT&C generated a net loss of $525 million for the six months ended June 30, 2025, compared to a net loss of $6.2 billion in the prior year.

Segment net interest income increased $520 million due to lower funding credit on deposits to other segments, the balance sheet repositioning in the prior period, and reinvesting cash flows into higher yielding securities, partially offset by the lower funding charges primarily on loans to other segments.
Noninterest income increased $6.6 billion primarily due to securities losses resulting from the balance sheet repositioning in 2024.
Noninterest expense decreased $298 million primarily driven by lower other expense due to a charitable contribution to the Truist Foundation in 2024 and increased credit from other segments for enterprise technology support expense, partially offset by increased professional fees and outside processing expense.

56 Truist Financial Corporation

Analysis of Financial Condition

Investment Activities

The securities portfolio totaled $115.4 billion at June 30, 2025, compared to $118.1 billion at December 31, 2024. U.S. Treasury, GSE, and Agency MBS represented 99.7% of the total securities portfolio as of June 30, 2025 and December 31, 2024. The overwhelming majority of the portfolio is in agency MBS.

The decrease in 2025 includes paydowns and maturities of $9.9 billion and sales of $1.1 billion, partially offset by purchases of $6.9 billion.
As of June 30, 2025 and December 31, 2024, 41% of the investment securities portfolio was classified as held-to-maturity based on amortized cost, excluding portfolio level basis adjustments associated with certain AFS securities.
As of June 30, 2025, approximately 3.3% of the securities portfolio was variable rate, excluding the impact of swaps, compared to 3.0% as of December 31, 2024.
The effective duration of the AFS securities portfolio was 5.0 years at June 30, 2025 and December 31, 2024, excluding the impact of swaps, or 3.3 years at June 30, 2025 and December 31, 2024, including the impact of swaps. The effective duration of the HTM securities portfolio was 7.1 years at June 30, 2025 and 7.0 years at December 31, 2024.

Lending Activities

The following table presents the composition of average loans and leases:


Table 5: Average Loans and Leases
	Three Months Ended
(Dollars in millions)	Jun 30, 2025		Mar 31, 2025		Dec 31, 2024		Sep 30, 2024		Jun 30, 2024
Commercial:
Commercial and industrial	$	158,491	$	155,214	$	153,209	$	154,102	$	157,043
CRE	19,687		19,832		20,504		21,481		21,969
Commercial construction	8,613		8,734		8,261		7,870		7,645

Consumer:
Residential mortgage	56,789		55,658		54,390		53,999		54,490
Home equity	9,586		9,569		9,675		9,703		9,805
Indirect auto	24,158		23,248		22,790		22,121		22,016
Other consumer	30,387		29,291		29,355		29,015		28,326

Credit card	4,890		4,849		4,926		4,874		4,905

Total average loans and leases HFI	$	312,601	$	306,395	$	303,110	$	303,165	$	306,199

Average loans and leases HFI were $312.6 billion for the second quarter of 2025, an increase of $6.2 billion, or 2.0%, compared to the first quarter of 2025.

Average commercial loans increased 1.6% due to an increase in the commercial and industrial portfolio.
Average consumer loans increased 2.7% due to growth in the residential mortgage, other consumer, and indirect auto portfolios.

End of period loans and leases HFI were $318.8 billion at June 30, 2025, up $10.2 billion, or 3.3%, compared to March 31, 2025 primarily due to increases in the commercial and industrial, residential mortgage, and other consumer portfolios.

At June 30, 2025 and December 31, 2024, 54% and 53% of loans and leases HFI were variable rate, respectively.

Truist Financial Corporation 57

Asset Quality

The following tables summarize asset quality information:


Table 6: Asset Quality
(Dollars in millions)	Jun 30, 2025		Mar 31, 2025		Dec 31, 2024		Sep 30, 2024		Jun 30, 2024
NPAs:
NPLs:
Commercial and industrial	$	520	$	586	$	521	$	575	$	459
CRE	128		294		298		302		360
Commercial construction	1		2		3		1		—

Residential mortgage	191		179		166		156		161
Home equity	107		114		116		118		123
Indirect auto	240		248		259		252		244
Other consumer	64		65		66		63		64

Total NPLs HFI	1,251		1,488		1,429		1,467		1,411
Loans held for sale	12		77		—		5		9
Total nonperforming loans and leases	1,263		1,565		1,429		1,472		1,420
Foreclosed real estate	4		4		3		3		5
Other foreclosed property	49		49		45		53		51
Total nonperforming assets	$	1,316	$	1,618	$	1,477	$	1,528	$	1,476

















Loans 90 days or more past due and still accruing:
Commercial and industrial	$	2	$	5	$	19	$	5	$	8
CRE	—		—		1		—		—
Commercial construction	—		—		—		—		1

Residential mortgage – government guaranteed	424		468		430		394		375
Residential mortgage – nonguaranteed	41		62		51		39		27
Home equity	6		6		9		7		7
Indirect auto	—		—		—		—		1
Other consumer	24		23		23		22		19


Credit card	49		52		54		51		51

Total loans 90 days or more past due and still accruing	$	546	$	616	$	587	$	518	$	489
Loans 30-89 days past due and still accruing:
Commercial and industrial	$	122	$	118	$	168	$	116	$	109
CRE	34		12		60		10		8
Commercial construction	15		—		3		4		—

Residential mortgage – government guaranteed	330		284		318		305		340
Residential mortgage – nonguaranteed	365		347		401		366		392
Home equity	54		57		60		63		58
Indirect auto	582		484		622		596		592
Other consumer	239		246		236		233		214


Credit card	70		71		81		76		78

Total loans 30-89 days past due and still accruing	$	1,811	$	1,619	$	1,949	$	1,769	$	1,791

Nonperforming assets totaled $1.3 billion at June 30, 2025, down $302 million compared to March 31, 2025, due to decreases in the CRE, commercial and industrial, and LHFS portfolios. Nonperforming loans and leases were 0.39% of loans and leases held for investment at June 30, 2025, down nine basis points compared to March 31, 2025.

Loans 90 days or more past due and still accruing totaled $546 million at June 30, 2025, down three basis points as a percentage of loans and leases compared with the prior quarter. Excluding government guaranteed loans, the ratio of loans 90 days or more past due and still accruing as a percentage of loans and leases was 0.04% at June 30, 2025, down one basis point compared to March 31, 2025.

Loans 30-89 days past due and still accruing totaled $1.8 billion at June 30, 2025, up $192 million, or five basis points, as a percentage of loans and leases, compared to the prior quarter primarily due to an increase in the indirect auto and residential mortgage portfolios.

58 Truist Financial Corporation

Problem loans include NPLs and loans that are 90 days or more past due and still accruing as disclosed in Table 6. In addition, for the commercial portfolio segment, loans that are rated special mention or substandard performing are closely monitored by management as potential problem loans. Refer to “Note 5. Loans and ACL” for the amortized cost basis of loans by origination year and credit quality indicator as well as additional disclosures related to NPLs.


Table 7: Asset Quality Ratios
	Jun 30, 2025		Mar 31, 2025		Dec 31, 2024		Sep 30, 2024		Jun 30, 2024
Loans 30-89 days past due and still accruing as a percentage of loans and leases	0.57	%	0.52	%	0.64	%	0.58	%	0.59	%
Loans 90 days or more past due and still accruing as a percentage of loans and leases	0.17		0.20		0.19		0.17		0.16
NPLs as a percentage of loans and leases	0.39		0.48		0.47		0.48		0.46
NPLs as a percentage of total loans and leases(1)	0.39		0.51		0.46		0.48		0.46
NPAs as a percentage of:
Total assets(1)	0.24		0.30		0.28		0.29		0.28
Loans and leases plus foreclosed property	0.41		0.50		0.48		0.50		0.48
Net charge-offs as a percentage of average loans and leases	0.51		0.60		0.59		0.55		0.58
ALLL as a percentage of loans and leases	1.54		1.58		1.59		1.60		1.57
Ratio of ALLL to:
Net charge-offs	3.1x		2.6x		2.7x		2.9x		2.7x
Nonperforming loans and leases	3.9x		3.3x		3.4x		3.3x		3.4x
Loans 90 days or more past due and still accruing as a percentage of loans and leases, excluding government guaranteed(2)	0.04	%	0.05	%	0.05	%	0.04	%	0.04	%

(1)Includes LHFS.

(2)This asset quality ratio has been adjusted to remove the impact of government guaranteed loans. Management believes the inclusion of such assets in this asset quality ratio results in distortion of this ratio because collection of principal and interest is reasonably assured.


Table 8: Asset Quality Ratios
											As of/For the Year-to-Date
	Three Months Ended										Period Ended June 30
	Jun 30, 2025		Mar 31, 2025		Dec 31, 2024		Sep 30, 2024		Jun 30, 2024		2025		2024
Net charge-offs as a percentage of average loans and leases:
Commercial:
Commercial and industrial	0.22	%	0.20	%	0.27	%	0.18	%	0.18	%	0.21	%	0.17	%
CRE	0.71		1.29		0.66		1.12		1.67		1.00		1.70
Commercial construction	(0.02)		(0.02)		(0.02)		(0.01)		(0.05)		(0.02)		(0.04)

Consumer:
Residential mortgage	—		—		(0.01)		(0.01)		(0.01)		—		—
Home equity	(0.04)		(0.07)		(0.07)		(0.11)		(0.03)		(0.05)		(0.06)
Indirect auto	1.63		2.26		2.33		1.89		1.94		1.94		2.10
Other consumer	1.54		1.71		1.63		1.73		1.60		1.62		1.78

Credit card	4.84		5.21		5.10		5.04		5.33		5.02		5.44
Total	0.51		0.60		0.59		0.55		0.58		0.55		0.61

Ratio of ALLL to net charge-offs	3.1x		2.6x		2.7x		2.9x		2.7x		2.9x		2.6x

Ratios are annualized, as applicable.

Truist Financial Corporation 59

The following table presents activity related to NPAs:


Table 9: Rollforward of NPAs
(Dollars in millions)	2025		2024
Balance, January 1	$	1,477	$	1,488
New NPAs	1,594		1,725
Advances and principal increases	240		331
Disposals of foreclosed assets(1)	(303)		(308)
Disposals of NPLs(2)	(243)		(118)
Charge-offs and losses	(619)		(673)
Payments	(692)		(760)
Transfers to performing status	(138)		(187)
Other, net	—		(22)
Ending balance, June 30	$	1,316	$	1,476

(1)Includes charge-offs and losses recorded upon sale of $130 million and $129 million for the six months ended June 30, 2025 and 2024, respectively.

(2)Includes gains, net of charge-offs and losses recorded upon sale of $6 million and $0 million for the six months ended June 30, 2025 and 2024, respectively.

Commercial Credit Concentrations

Truist has established the following general practices to manage commercial credit risk:

limiting the amount of credit that Truist may extend to a borrower;
establishing a process for credit approval accountability;
initial underwriting and analysis of borrower, transaction, market, and collateral risks;
evaluating the diversity of the loan portfolio in terms of type, industry, and geographical concentration;
ongoing servicing and monitoring of individual loans and lending relationships;
continuous monitoring of the portfolio, market dynamics, and the economy; and
periodically reevaluating the Company’s strategy and overall exposure as economic, market, and other relevant conditions change.

Truist monitors various segments of its credit portfolios to assess potential concentration risks. Management is involved in the credit approval and review process, and risk acceptance criteria are adjusted as needed to reflect the Company’s risk appetite. Consistent with established risk management objectives, the Company utilizes various risk mitigation techniques, including collecting collateral and security interests, obtaining guarantees, and, to a limited extent, through the purchase of credit loss protection via third-party insurance or use of credit derivatives such as credit default swaps.

In the commercial portfolio, risk concentrations are evaluated regularly on both an aggregate portfolio level and on an individual client basis. The Company manages its commercial exposure through portfolio targets, limits, and transactional risk acceptance criteria as well as other techniques, including loan syndications/participations, loan sales, collateral, structure, covenants, and other risk reduction techniques.

The following tables provide industry distribution by major types of commercial credit exposure and the geographical distribution of commercial exposures. Industry classification for commercial and industrial loans is based on the North American Industry Classification System. CRE loans are classified based on type of property. For the geographic disclosures, amounts are generally assigned to a state based on the physical billing address of the client or physical property address.

60 Truist Financial Corporation


Table 10: Commercial and Industrial Portfolio Industry and Geography
	June 30, 2025				December 31, 2024

(Dollars in millions)	LHFI		% of Total			NPL		LHFI		% of Total		NPL
Industry:
Finance and insurance	$	26,290	16.2	%		$	7	$	24,271	15.7	%	$	28
Manufacturing	13,672		8.4			84		12,298		7.9		62
Retail trade	12,448		7.7			22		12,488		8.1		66
Health care and social assistance	12,016		7.4			7		12,154		7.8		129
Real estate and rental and leasing	11,387		7.0			4		11,354		7.3		3
Public administration	8,722		5.4			—		8,860		5.7		—
Wholesale trade	8,033		5.0			48		7,428		4.8		45
Information	7,292		4.5			158		5,235		3.4		66
Utilities	5,761		3.6			—		4,096		2.6		—
Educational services	5,143		3.2			—		4,478		2.9		—
Transportation and warehousing	4,486		2.8			34		4,634		3.0		34
Professional, scientific, and technical services	4,406		2.7			5		4,125		2.7		8
Arts, entertainment, and recreation	3,897		2.4			8		3,599		2.3		6
Accommodation and food services	3,315		2.0			8		2,935		1.9		9
Construction	3,257		2.0			7		2,607		1.7		10
Administrative and support and waste management and remediation services	3,105		1.9			28		3,022		2.0		—
Other(1)	11,295		6.9			23		12,211		7.9		23
Subtotal	144,525		89.1			443		135,795		87.7		489
Business owner occupied	17,748		10.9			77		19,053		12.3		32
Total commercial and industrial	$	162,273	100.0	%		$	520	$	154,848	100.0	%	$	521

Geography:
Florida	$	18,619	11.5	%		$	33	$	18,258	11.8	%	$	172
Texas	16,345		10.1			53		14,728		9.5		47
North Carolina	12,156		7.5			14		12,167		7.9		16
Georgia	11,715		7.2			12		11,240		7.3		10
New York	11,555		7.1			10		11,379		7.3		50
California	9,269		5.7			21		8,115		5.2		8
Virginia	9,225		5.7			4		9,343		6.0		7
Pennsylvania	6,999		4.3			139		6,466		4.2		9
Maryland	6,862		4.2			4		6,781		4.4		3
Tennessee	5,914		3.6			46		5,729		3.7		51
New Jersey	4,207		2.6			12		3,947		2.5		5
South Carolina	4,191		2.6			22		4,151		2.7		23
Illinois	4,174		2.6			18		3,639		2.4		20
Ohio	3,776		2.3			—		3,482		2.2		1
Other(2)	37,266		23.0			132		35,423		22.9		99
Total commercial and industrial	$	162,273	100.0	%		$	520	$	154,848	100.0	%	$	521

(1)Represents other remaining industries that are deemed to be individually insignificant.

(2)Includes non-U.S. loans of $4.4 billion and $4.1 billion at June 30, 2025 and December 31, 2024, respectively. The remainder represents other remaining states that are deemed to be individually insignificant.

Truist has noted that the CRE and commercial construction portfolios have the potential for heightened risk in the current environment. Truist seeks to maintain a high-quality portfolio through disciplined risk management and prudent client selection.

Truist’s CRE and commercial construction portfolios totaled $28.5 billion as of June 30, 2025, which includes 37% related to multifamily residential, 22% related to industrial, 13% related to office, 13% related to retail, and the remainder composed of hotel and other commercial real estate.

Our combined CRE and commercial construction office portfolio is primarily composed of multi-tenant, non-gateway properties located within Truist Bank’s footprint. As of June 30, 2025, approximately 94% of these properties are multi-tenant or medical. Additionally, as of June 30, 2025, 14% and 28% of these exposures are scheduled to mature in 2025 and 2026, respectively, with the remainder scheduled to mature in 2027 and beyond.

Truist Financial Corporation 61


Table 11: CRE Portfolio Property Type and Geography
	June 30, 2025				December 31, 2024

(Dollars in millions)	LHFI		% of Total			NPL		LHFI		% of Total		NPL
Industry:
Multifamily	$	6,042	29.8	%		$	3	$	5,508	27.0	%	$	27
Industrial	4,681		23.1			—		4,303		21.1		3
Retail	3,570		17.6			28		3,530		17.3		33
Office	2,763		13.6			89		3,459		17.0		228
Hotel	1,718		8.5			—		1,891		9.3		—
Other(1)	1,496		7.4			8		1,672		8.3		7
Total CRE	$	20,270	100.0	%		$	128	$	20,363	100.0	%	$	298

Geography:
Florida	$	2,532	12.5	%		$	8	$	2,594	12.7	%	$	26
Georgia	2,355		11.6			17		2,010		9.9		80
North Carolina	2,235		11.0			3		2,212		10.9		10
Texas	2,033		10.0			5		1,599		7.9		6
New York	1,618		8.0			2		1,491		7.3		2
California	1,582		7.8			—		1,683		8.3		—
Pennsylvania	1,326		6.5			1		1,218		6.0		1
Virginia	1,041		5.1			—		1,108		5.4		3
Tennessee	713		3.5			—		715		3.5		1
Massachusetts	679		3.3			25		860		4.2		27
Maryland	656		3.2			—		713		3.5		8
Other(2)	3,500		17.5			67		4,160		20.4		134
Total CRE	$	20,270	100.0	%		$	128	$	20,363	100.0	%	$	298

(1)Represents other remaining property types that are deemed to be individually insignificant.

(2)Includes non-U.S. loans of $54 million at December 31, 2024. The remainder represents other remaining states that are deemed to be individually insignificant.


Table 12: Commercial Construction Portfolio Property Type and Geography
	June 30, 2025				December 31, 2024

(Dollars in millions)	LHFI		% of Total			NPL		LHFI		% of Total		NPL
Industry:
Multifamily	$	4,602	55.6	%		$	—	$	4,918	57.7	%	$	—
Industrial	1,763		21.3			—		1,680		19.7		—
Single Family - CP	873		10.5			—		664		7.8		2
Office	412		5.0			—		627		7.4		—
Hotel	196		2.4			—		130		1.5		—
Other(1)	431		5.2			1		501		5.9		1
Total commercial construction	$	8,277	100.0	%		$	1	$	8,520	100.0	%	$	3

Geography:
Texas	$	1,339	16.2			$	—	$	1,345	15.8		$	—
Georgia	1,165		14.1			—		1,294		15.2		—
Florida	1,118		13.5			—		1,138		13.4		—
North Carolina	1,014		12.3			—		992		11.6		1
California	547		6.6			—		492		5.8		—
Other(2)	3,094		37.3			1		3,259		38.2		2
Total commercial construction	$	8,277	100.0	%		$	1	$	8,520	100.0	%	$	3

(1)Represents other remaining property types that are deemed to be individually insignificant.

(2)Represents other remaining states that are deemed to be individually insignificant.

See additional information on the commercial portfolios in “Note 5. Loans and ACL,” including loans by origination year and credit quality indicator.

62 Truist Financial Corporation

ACL

Activity related to the ACL is presented in the following tables:


Table 13: Activity in ACL
	Three Months Ended										Six Months Ended June 30,
(Dollars in millions)	Jun 30, 2025		Mar 31, 2025		Dec 31, 2024		Sep 30, 2024		Jun 30, 2024		2025		2024
Balance, beginning of period	$	5,166	$	5,161	$	5,140	$	5,110	$	5,100	$	5,161	$	5,093


Provision for credit losses	488		458		471		448		451		946		951

Charge-offs:
Commercial and industrial	(120)		(102)		(119)		(96)		(83)		(222)		(180)
CRE	(38)		(70)		(51)		(65)		(97)		(108)		(200)


Residential mortgage	(1)		(1)		(1)		—		(1)		(2)		(2)
Home equity	(4)		(2)		(2)		(1)		(3)		(6)		(6)
Indirect auto	(127)		(154)		(158)		(143)		(136)		(281)		(290)
Other consumer	(146)		(154)		(148)		(152)		(141)		(300)		(306)

Credit card	(70)		(74)		(74)		(71)		(74)		(144)		(151)

Total charge-offs	(506)		(557)		(553)		(528)		(535)		(1,063)		(1,135)
Recoveries:
Commercial and industrial	31		24		15		26		14		55		46
CRE	3		7		17		5		5		10		12
Commercial construction	1		—		—		1		1		1		1

Residential mortgage	—		2		2		1		2		2		3
Home equity	4		4		3		4		4		8		9
Indirect auto	28		25		24		38		30		53		58
Other consumer	31		30		28		26		28		61		56

Credit card	12		11		11		9		9		23		18
Total recoveries	110		103		100		110		93		213		203
Net charge-offs	(396)		(454)		(453)		(418)		(442)		(850)		(932)
Other	(5)		1		3		—		1		(4)		(2)
Balance, end of period	$	5,253	$	5,166	$	5,161	$	5,140	$	5,110	$	5,253	$	5,110


ACL:
ALLL	$	4,899	$	4,870	$	4,857	$	4,842	$	4,808
RUFC	354		296		304		298		302
Total ACL	$	5,253	$	5,166	$	5,161	$	5,140	$	5,110

The allowance for credit losses was $5.3 billion at June 30, 2025 and included $4.9 billion for the allowance for loan and lease losses and $354 million for the reserve for unfunded commitments. The ALLL ratio was 1.54%, down four basis points compared with March 31, 2025. The ALLL covered nonperforming loans and leases held for investment 3.9x, compared to 3.3x at March 31, 2025. At June 30, 2025, the ALLL was 3.1x annualized net charge-offs, compared to 2.6x at March 31, 2025.

The following table presents an allocation of the ALLL. The entire amount of the allowance is available to absorb losses occurring in any category of loans and leases.


Table 14: Allocation of ALLL by Category
	June 30, 2025						December 31, 2024
(Dollars in millions)	Amount		% ALLL in Each Category		% Loans in Each Category		Amount		% ALLL in Each Category		% Loans in Each Category
Commercial and industrial	$	1,309	26.6	%	50.9	%	$	1,284	26.4	%	50.7	%
CRE	563		11.5		6.4		643		13.2		6.6
Commercial construction	259		5.3		2.6		257		5.3		2.8

Residential mortgage	220		4.5		18.1		204		4.2		18.1
Home equity	92		1.9		3.0		89		1.8		3.1
Indirect auto	990		20.2		7.7		955		19.7		7.5
Other consumer	1,051		21.5		9.8		994		20.5		9.6

Credit card	415		8.5		1.5		431		8.9		1.6
Total ALLL	4,899		100.0	%	100.0	%	4,857		100.0	%	100.0	%
RUFC	354						304
Total ACL	$	5,253					$	5,161

Truist Financial Corporation 63

Truist monitors the performance of its home equity loans and lines secured by second liens similarly to other consumer loans and utilizes assumptions specific to these loans in determining the necessary ALLL. Truist also receives notification when the first lien holder, whether Truist or another financial institution, has initiated foreclosure proceedings against the borrower. When notified that the first lien is in the process of foreclosure, Truist obtains valuations to determine if any additional charge-offs or reserves are warranted. These valuations are updated at least annually thereafter.

Truist has limited ability to monitor the delinquency status of the first lien, unless the first lien is held or serviced by Truist. Truist estimates credit losses on second lien loans where the first lien is delinquent based on historical experience; the increased risk of loss on these credits is reflected in the ALLL. As of June 30, 2025, Truist held or serviced the first lien on 33% of its second lien positions.

Other Assets

The components of other assets are presented in the following table:


Table 15: Other Assets as of Period End
(Dollars in millions)	Jun 30, 2025		Dec 31, 2024
Tax credit and other private equity investments	$	9,627	$	9,303
Bank-owned life insurance	7,846		7,801
Prepaid pension assets	7,383		7,238
Accounts receivable	2,094		1,904
Accrued income	2,017		2,069
Derivative assets	1,647		966
DTAs, net	1,627		1,945
Leased and related assets	1,451		1,352
FHLB stock	1,103		965
Prepaid expenses	1,098		1,061
ROU assets	1,042		1,015

Other	1,032		1,513
Total other assets	$	37,967	$	37,132

64 Truist Financial Corporation

Funding Activities

Deposits

The following table presents average deposits:


Table 16: Average Deposits
	Three Months Ended
(Dollars in millions)	Jun 30, 2025		Mar 31, 2025		Dec 31, 2024		Sep 30, 2024		Jun 30, 2024
Noninterest-bearing deposits	$	106,686	$	105,895	$	107,968	$	106,080	$	107,634
Interest checking	116,193		109,208		107,075		103,899		103,894
Money market and savings	135,607		136,897		138,242		136,639		135,264
Time deposits	41,997		40,204		36,757		37,726		41,250

Total average deposits	$	400,483	$	392,204	$	390,042	$	384,344	$	388,042

Average deposits for the second quarter of 2025 were $400.5 billion, an increase of $8.3 billion, or 2.1%, compared to the first quarter of 2025.

Average noninterest-bearing deposits increased 0.7% compared to the prior quarter and represented 26.6% of total deposits for the second quarter of 2025 compared to 27.0% for the first quarter of 2025. Average interest checking deposits increased 6.4% primarily due to short-term client deposits. Average money market and savings accounts decreased 0.9%. Average time deposits increased 4.5%.

Borrowings

At June 30, 2025, short-term borrowings totaled $16.6 billion, a decrease of $12.6 billion compared to December 31, 2024. Average short-term borrowings were $28.3 billion and $26.1 billion for the six months ended June 30, 2025 and 2024, respectively.

Long-term debt provides funding and, to a lesser extent, regulatory capital, and primarily consists of senior and subordinated notes issued by the Parent Company and Truist Bank. Long-term debt totaled $44.4 billion at June 30, 2025, an increase of $9.5 billion compared to December 31, 2024. During the six months ended June 30, 2025, the Company had:

Net issuances of $9.7 billion floating rate FHLB advances.
Maturities and redemptions of $3.1 billion of senior notes.
Issuances of $2.5 billion fixed-to-floating rate senior notes with interest rates between 4.67% and 5.07% due between May 20, 2027 and May 20, 2031.

In July 2025, Truist redeemed all $1.5 billion principal amount outstanding of its fixed-to-floating rate senior holding company notes due July 28, 2026.

In July 2025, Truist issued $1.5 billion principal amount of fixed-to-floating rate senior bank notes with an interest rate of 4.42% due July 24, 2028 and $500 million floating rate senior bank notes due July 24, 2028.

Truist Financial Corporation 65

Shareholders’ Equity

Truist’s book value per common share and TBVPS are presented in the following table:


Table 17: Book Value per Common Share
(Dollars in millions, except per share data, shares in thousands)	Jun 30, 2025		Dec 31, 2024
Common equity per common share	$	45.70	$	43.90
Non-GAAP capital measure:(1)
Tangible common equity per common share	$	31.63	$	30.01
Calculation of tangible common equity:(1)
Total shareholders’ equity	$	64,840	$	63,679
Less:
Preferred stock	5,907		5,907

Goodwill and intangible assets, net of deferred taxes	18,143		18,274
Tangible common equity	$	40,790	$	39,498

Common shares outstanding at end of period	1,289,435		1,315,936

(1)Tangible common equity is a non-GAAP measure that excludes the impact of intangible assets, net of deferred taxes. This measure is useful for evaluating the performance of a business consistently, whether acquired or developed internally. Truist’s management uses this measure to assess balance sheet risk and shareholder value.

Total shareholders’ equity was $64.8 billion at June 30, 2025, an increase of $1.2 billion from December 31, 2024. This increase includes $2.5 billion in net income and $1.3 billion in OCI, partially offset by $1.5 billion in common and preferred dividends and $1.3 billion in common share repurchases, including excise taxes. For the second quarter of 2025, the dividend payout ratio was 57% and the total payout ratio was 121%. Truist’s book value per common share at June 30, 2025 was $45.70, compared to $43.90 at December 31, 2024. Truist’s TBVPS of $31.63 at June 30, 2025, increased 5.4% compared to December 31, 2024.

66 Truist Financial Corporation

Risk Management

Truist seeks to maintain a comprehensive risk management framework supported by people, processes, and systems to identify, measure, monitor, manage, and report significant risks arising from its exposures and business activities. A key objective of the Company’s risk management framework is to promote the execution of strategic goals and objectives in alignment with its risk appetite.

Truist has developed a risk management taxonomy to provide for the identification and classification of risk elements at Truist. The objective of the risk management taxonomy is to define enterprise-wide categorization for elements used in risk management activities, establish consistently applied language, and enable data analysis, aggregation, and reporting.

Truist is committed to fostering a culture that supports the identification and escalation of risks across the organization. All teammates are responsible for upholding the Company’s purpose, mission, and values, and are encouraged to speak up if there is any activity or behavior that is inconsistent with the Company’s culture. The Truist code of ethics influences the Company’s decision making and informs teammates on how to act in the absence of specific guidance.

Truist seeks an appropriate return for the risk taken in its business operations. Risk-taking activities must be evaluated and prioritized to identify those that present attractive risk-adjusted returns, while preserving asset value and capital.

Market Risk

Market risk is the risk to current or anticipated earnings, capital, or economic value arising from changes in interest rates, spreads, or prices of financial instruments, and the corresponding impact on the composition of the balance sheet or trading and fair value positions. Market risk results from changes in the level, volatility, or correlations among financial market risk factors or prices, including interest rates, credit spreads, foreign exchange rates, equity, and commodity prices.

Truist’s most significant market risk exposure is to interest rate risk in its balance sheet; however, market risk also results from underlying product liquidity risk, price risk, and volatility risk of instruments held in Truist’s business units. Interest rate risk results from: differences between the timing of rate changes and the timing of cash flows associated with assets and liabilities (re-pricing risk); changing rate relationships among different yield curves affecting bank activities (basis risk); changing rate relationships across the spectrum of maturities (yield curve risk); and interest-related options inherently embedded in bank products (options risk).

The primary objectives of market risk management are to minimize adverse effects from changes in market risk factors on net interest income, net income, and capital, and to offset the risk of price changes for certain assets and liabilities recorded at fair value. At Truist, market risk management also includes the enterprise-wide IPV function.

Interest Rate Market Risk

As a financial institution, Truist is exposed to interest rate risk from assets, liabilities, and off-balance sheet positions. Truist primarily monitors this risk through two measurement types, (i) NII at risk and (ii) economic value of equity. Truist manages this risk with securities, derivatives, and broader asset liability management activities. Truist uses derivatives to hedge interest income variability of floating rate loans and to hedge valuation changes of long-term debt and investment securities.

IRR measurement is reported monthly through the ALCO. Monthly IRR reporting includes exposure and historical trends relative to risk limit scenarios, impacts to a wide range of rate scenarios, and sensitivity tests of key assumptions. IRR reporting is provided to the BRC quarterly.

IRR measurement is influenced by data, assumptions, and models. Due to their high sensitivity to market rates, mortgage (loan and security) prepayments leverage an industry model that results in varying prepayment speeds across rate scenarios. Prepayments for non-mortgage loans leverage a mix of dynamic models (varying results based on market rates) and static prepayment assumptions based on historical experience. Our analysis incorporates dynamic client deposit balance levels, the mix across product types, and deposit rate paid across alternate rate scenarios based on modeled changes in client and bank behavior. The use of dynamic deposit balance models results in rotation to higher cost funding products (e.g., CDs) when market rates increase and to lower cost funding products (e.g., non-maturity deposits) when market rates decrease. The use of dynamic rate paid models results in varying deposit betas based on the timing and conditions within market rate cycles.

Truist Financial Corporation 67

NII at risk measures the change in NII under alternate interest rate scenarios relative to Truist’s baseline scenario, which incorporates Truist’s current balance sheet and off-balance sheet hedges as well as expectations for new business over the forecast horizon. Truist’s baseline scenario relies on assumptions including expectations of the economy and interest rates – which are influenced by market conditions, new business volume, pricing, and client behavior. In measuring NII at risk, Truist assumes that changes in key factors, such as prepayments and deposit pricing (betas), largely move in line with those it has experienced in prior rate cycles. However, future behavior of key factors may vary from Truist’s assumptions. NII at risk measurement assumes, when applicable, that U.S. interest rates floor at zero and Truist does not take any balance sheet or hedging actions in response to the rate scenarios.

Truist evaluates a wide range of alternate scenarios including instantaneous and gradual as well as parallel and non-parallel changes in interest rates. The table below presents the estimated change to NII over the following 12 months for select parallel alternate scenarios, expressed as a percentage change relative to baseline NII.




Table 18: Interest Sensitivity Simulation Analysis
	Jun 30, 2025		Dec 31, 2024
Up 200bps gradual change in interest rates	2.0	%	1.1	%
Up 50bps instantaneous change in interest rates	0.8		0.6
Down 50bps instantaneous change in interest rates	(1.0)		(0.8)
Down 200bps gradual change in interest rates	(3.0)		(2.1)

Truist performs and monitors sensitivity tests of key assumptions used in NII risk including:

Asset prepayment speeds
New loan volume pricing spreads
Interest-bearing deposit betas
Non-interest-bearing demand deposit balance runoff, replaced by market funding

EVE measures changes in the economic value of Truist’s current balance sheet and off-balance sheet hedges under alternate rate scenarios relative to starting economic value. Truist uses EVE as a longer-term measure of interest rate risk. Truist performs and monitors sensitivity tests of key assumptions used in EVE including:

Asset prepayment speeds
Mortgage spreads (mortgage loan and security valuations)
Interest-bearing deposit beta
Deposit runoff / decay

Key assumption tests are generally performed by increasing and decreasing the assumption, whether static or dynamically modeled, relative to their respective starting values and then measuring the resulting impact to NII and EVE under baseline and alternate rate scenarios.

The identification and testing of key assumptions are influenced by market conditions and management views of key risks. The results of key assumption sensitivity tests are reported to ALCO and BRC at least quarterly. Key assumptions and their associated sensitivity tests are reviewed with ALCO and BRC at least annually.

Market Risk from Trading Activities

As a financial intermediary, Truist provides its clients access to derivatives, foreign exchange, and securities markets, which generate market risks. Trading market risk is managed using a multi-faceted risk management approach, which includes measuring risk using VaR, stress testing, and sensitivity analysis. Risk metrics are monitored against a suite of limits at both the trading desk level and at the aggregate portfolio level.

Truist is also subject to risk-based capital guidelines for market risk under the Market Risk Rule.

68 Truist Financial Corporation

Covered Trading Positions

Covered positions subject to the Market Risk Rule include trading assets and liabilities, specifically those held for the purpose of short-term resale or with the intent of benefiting from actual or expected short-term price movements or to lock in arbitrage profits. Truist’s trading portfolio of covered positions results primarily from market making and underwriting services for the Company’s clients, as well as associated risk mitigating hedging activity. The trading portfolio, measured in terms of VaR, consists primarily of four sub-portfolios of covered positions: (i) credit trading, (ii) fixed income securities, (iii) interest rate derivatives, and (iv) equity derivatives. As a market maker across different asset classes, Truist’s trading portfolio also contains other sub-portfolios, including foreign exchange, loan trading, and commodity derivatives; however, these portfolios do not generate material trading risk exposures.

Valuation policies and methodologies exist for all trading positions. Additionally, these positions are subject to independent price verification. See “Note 16. Derivative Financial Instruments,” “Note 15. Fair Value Disclosures,” and “Critical Accounting Policies” herein for discussion of valuation policies and methodologies.

Securitizations

As of June 30, 2025, the aggregate market value of on-balance sheet securitization positions subject to the Market Risk Rule, which were non-agency asset backed securities positions, was $93 million. Consistent with the Market Risk Rule requirements, the Company performs pre-purchase due diligence on each securitization position to identify the characteristics, including deal structure and the asset quality of the underlying assets, that materially affect valuation and performance. Securitization positions are subject to Truist’s risk management framework, which includes daily monitoring against a suite of limits. There were no off-balance sheet securitization positions during the reporting period.

Correlation Trading Positions

The trading portfolio of covered positions did not contain any correlation trading positions as of June 30, 2025.

VaR-Based Measures

VaR measures the potential loss of a given position or portfolio of positions at a specified confidence level and time horizon. Truist utilizes a historical VaR methodology to measure and aggregate risks across its covered trading positions. For risk management purposes, the VaR calculation is based on a historical simulation approach and measures the potential trading losses using a one-day holding period at a one-tail, 99% confidence level. For Market Risk Rule purposes, the Company calculates VaR using a 10-day holding period and a 99% confidence level. Due to inherent limitations of the VaR methodology, such as the assumption that past market behavior is indicative of future market performance, VaR is only one of several tools used to measure and manage market risk. Other tools used to manage market risk include stress testing, scenario analysis, and stop loss limits.

The trading portfolio’s VaR profile is influenced by a variety of factors, including the size and composition of the portfolio, market volatility, and the correlation between different positions. A portfolio of trading positions is typically less risky than the sum of the risk from each of the individual sub-portfolios, because, under normal market conditions, risk within each category partially offsets the exposure to other risk categories. The following table summarizes certain VaR-based measures for the three and six months ended June 30, 2025 and 2024. Average VaR measures in the three and six-months ended June 30, 2025 were higher compared to the three and six-months ended June 30, 2024 primarily due to tariff related market volatility in April.

Truist Financial Corporation 69


Table 19: VaR-based Measures
	Three Months Ended June 30,								Six Months Ended June 30,
	2025				2024				2025				2024
(Dollars in millions)	10-Day Holding Period		1-Day Holding Period		10-Day Holding Period		1-Day Holding Period		10-Day Holding Period		1-Day Holding Period		10-Day Holding Period		1-Day Holding Period
VaR-based Measures:
Maximum	$	63	$	13	$	25	$	7	$	63	$	15	$	27	$	12
Average	28		10		20		6		24		9		21		8
Minimum	16		5		14		5		9		4		14		5
Period-end	23		11		23		7		23		11		23		7
VaR by Risk Class:
Interest Rate Risk			6				7				6				7
Credit Spread Risk			6				10				6				10
Equity Price Risk			7				3				7				3
Foreign Exchange Risk			1				—				1				—
Portfolio Diversification			(8)				(13)				(8)				(13)
Period-end			11				7				11				7

Stressed VaR-based measures

Stressed VaR, another component of market risk capital, is calculated using the same internal models as used for the VaR-based measure. Stressed VaR is calculated over a ten-day holding period at a one-tail, 99% confidence level and employs a historical simulation approach based on a continuous twelve-month historical window selected to reflect a period of significant financial stress for the Company’s trading portfolio. The following table summarizes Stressed VaR-based measures:


Table 20: Stressed VaR-based Measures - 10 Day Holding Period
	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in millions)	2025		2024		2025		2024
Maximum	$	248	$	209	$	287	$	209
Average	125		148		153		131
Minimum	70		82		70		69
Period-end	96		154		96		154

Specific Risk Measures

Specific risk is a measure of idiosyncratic risk that could result from risk factors other than broad market movements (e.g., default or event risks). The Market Risk Rule provides fixed risk weights under a standardized measurement method while also allowing a model-based approach, subject to regulatory approval. Truist utilizes the standardized measurement method to calculate the specific risk component of market risk regulatory capital. As such, incremental risk capital requirements do not apply.

VaR Model Backtesting

In accordance with the Market Risk Rule, the Company evaluates the accuracy of its VaR model through daily backtesting by comparing aggregate daily trading gains and losses (excluding fees, commissions, reserves, net interest income, and intraday trading) from covered positions with the corresponding daily VaR-based measures generated by the model. As illustrated in the following graph, there was one Company-wide VaR backtesting exception during the twelve months ended June 30, 2025. The backtesting exception was driven by tariff-related market volatility. The total number of Company-wide VaR backtesting exceptions over the preceding twelve months is used to determine the multiplication factor for the VaR-based capital requirement under the Market Risk Rule. The capital multiplication factor increases from a minimum of three to a maximum of four, depending on the number of exceptions. All Company-wide VaR backtesting exceptions are reviewed in the context of VaR model use and performance. There was no change in the capital multiplication factor over the preceding twelve months.

70 Truist Financial Corporation

12250

Model Risk Oversight

MRO is responsible for the independent model validation of all decision models, including trading market risk models. As part of ongoing monitoring efforts, the performance of all trading risk models is reviewed regularly to evaluate model performance with emerging developments in financial markets, assess evolving modeling approaches, and identify potential model enhancement.

Stress Testing

The Company uses a range of stress testing techniques to help monitor risks across trading desks and to augment standard daily VaR and other risk limits reporting. The stress testing framework is designed to quantify the impact of extreme, but plausible, stress scenarios that could lead to large, unexpected losses. Stress tests include simulations for risk factor sensitivities, historical repeats, and hypothetical scenarios with varying liquidity horizons of key risk factors. All trading positions within each applicable market risk category (i.e., interest rate risk, equity risk, foreign exchange rate risk, credit spread risk, and commodity price risk) are included in the Company’s stress testing framework. Management reviews stress testing scenarios and makes updates on an ongoing basis. Management also utilizes stress analyses to support the Company’s capital adequacy assessment standards. See the “Capital” section of MD&A for additional discussion of capital adequacy.

Liquidity

Liquidity is the ability to fund increases in assets and meet obligations as they come due, all without incurring unacceptable costs. In addition to the level of liquid assets, such as cash, cash equivalents, and highly liquid unencumbered securities, other factors affect the ability to meet liquidity needs, including access to a variety of funding sources, maintaining borrowing capacity, growing core deposits, loan repayment, and the ability to securitize or package loans for sale.

Truist has a liquidity risk management process designed to identify, measure, and monitor key liquidity risks to assess whether Truist is operating within its liquidity risk appetite. The liquidity risk appetite is outlined using a qualitative statement and more granular detailed risk appetite statements aligned to Truist’s risk taxonomy; risk statements form the basis for aligning risk appetite with risk management goals and strategy. Using the risk appetite statements, key risk indicators are developed that represent quantitative metrics which measure current risk exposure relative to Truist’s risk appetite, which help the Board and management monitor liquidity risk taking activity. Truist’s key risk indicators are designed to support the following objectives:

maintain (i) a diversified, but client deposit centric, funding base, (ii) a level of liquid, readily monetized assets sufficient to satisfy business as usual and stressed cash flow needs across multiple liquidity horizons, and (iii) an appropriate level of contingent funding to meet any unexpected needs;
limit concentration risk from individual, correlated counterparties, and funding concentrations in tenors that may negatively impact Truist from an unforeseen idiosyncratic or market event; and
maintain sufficient liquidity in the holding company to serve as a source of strength to its subsidiaries.

Truist Financial Corporation 71

Internal Liquidity Stress Testing

Liquidity stress testing is conducted for Truist and Truist Bank using a variety of institution-specific and market-wide adverse scenarios. Each liquidity stress test scenario applies defined assumptions to execute sources and uses of liquidity over varying planning horizons. The types of expected liquidity uses during a stressed event may include deposit attrition, contractual maturities, reductions in unsecured and secured funding, increased draws on unfunded commitments, and the potential need to post additional collateral for derivatives. To mitigate liquidity outflows, Truist has identified sources of liquidity; however, access to these sources of liquidity could be affected within a stressed environment.

Truist maintains a liquidity buffer of cash on hand and highly liquid unencumbered securities that is designed to meet the projected 30-day net stressed cash-flow needs. Truist’s liquidity buffer is substantially the same in composition to what qualifies as HQLA under the LCR Rule. Truist periodically monetizes a representative sample of the liquidity buffer to assess operational readiness through available monetization channels.

Contingency Funding Plan

Truist has a contingency funding plan designed to address ongoing obligations and commitments, particularly in the event of a liquidity contraction. This plan is designed to examine and quantify the organization’s liquidity under the various internal liquidity stress scenarios and is periodically tested to assess the plan’s reliability. Additionally, the plan provides a framework for management and other teammates to follow in the event of a liquidity contraction or in anticipation of such an event. The plan addresses authority for activation and decision making, liquidity options, and the responsibilities of key departments in the event of a liquidity contraction. On a quarterly basis, Truist conducts testing of market access for alternative sources of funds (e.g. discount window, standing repo facility, etc.) to test operational readiness. On a periodic basis, Truist conducts a table-top test of the Contingency Funding Plan to assess reliability of the plan during liquidity stress events and to simulate the operational elements of the plan such as communications, coordination, and decision-making.

LCR, NSFR, and HQLA

The LCR rule requires that Truist and Truist Bank maintain an amount of eligible HQLA that is sufficient within the parameters of the rule to meet their estimated total net cash outflows over a prospective 30 calendar-day period of stress. Eligible HQLA, for purposes of calculating the LCR, is the amount of unencumbered HQLA that satisfy operational requirements of the LCR rule. Truist and Truist Bank are subject to the Category III reduced LCR requirements. Truist held average weighted eligible HQLA of $93.0 billion and Truist’s average LCR was 110% for the three months ended June 30, 2025.

The NSFR rule defines a minimum amount of stable, long-term funding that Truist and Truist Bank must maintain in relation to their asset composition and off-balance sheet activities. Truist and Truist Bank are subject to the Category III reduced NSFR requirements. At June 30, 2025, Truist was compliant with this requirement.

Sources of Funds

Truist funds its balance sheet through diverse sources of funding including client deposits, secured and unsecured capital markets funding, and shareholders’ equity. Truist Bank’s primary source of funding is client deposits. Continued access to client deposits is highly dependent on public confidence in the stability of Truist Bank and its ability to return funds to clients when requested.

Truist Bank maintains a number of diverse funding sources to meet its liquidity requirements. These sources include unsecured borrowings from the capital markets through the issuance of senior or subordinated bank notes, institutional CDs, overnight and term Federal funds markets, and retail brokered CDs. Truist Bank also maintains access to secured borrowing sources, including FHLB advances, repurchase agreements, and the FRB discount window. Available investment securities could be pledged to create additional secured borrowing capacity. The following table presents a summary of Truist Bank’s available secured borrowing capacity and eligible cash at the FRB:


Table 21: Selected Liquidity Sources
(Dollars in millions)	Jun 30, 2025		Dec 31, 2024
Unused borrowing capacity:
FRB	$	80,374	$	72,040
FHLB	30,417		31,411
Available investment securities (at fair value)	75,441		68,212
Available secured borrowing capacity	186,232		171,663
Eligible cash at the FRB	35,082		33,717
Total	$	221,314	$	205,380

72 Truist Financial Corporation

At June 30, 2025, Truist Bank’s available secured borrowing capacity represented approximately 5.5 times the amount of wholesale funding maturities in one year or less.

Parent Company

The Parent Company serves as the primary source of capital for its operating subsidiaries. The Parent Company’s assets consist primarily of cash on deposit with Truist Bank, equity investments in subsidiaries, advances to subsidiaries, and notes receivable from subsidiaries. The principal obligations of the Parent Company are payments on long-term debt. The main sources of funds for the Parent Company are dividends and management fees from subsidiaries, repayments of advances to subsidiaries, and proceeds from the issuance of equity and long-term debt. The primary uses of funds by the Parent Company are investments in subsidiaries, advances to subsidiaries, dividend payments to common and preferred shareholders, repurchases of common stock, payments on and, from time-to-time, potential repurchases or redemptions of long-term debt of the Parent Company (as may be permitted by the terms of each respective series), and the redemption of preferred stock. See “Note 22. Parent Company Financial Information” in Truist’s Annual Report on Form 10-K for the year ended December 31, 2024 for additional information regarding dividends from subsidiaries and debt transactions.

Access to funding at the Parent Company is more sensitive to market disruptions. Therefore, Truist manages cash levels at the Parent Company to exceed a minimum of 12 months of projected cash outflows. In determining the buffer, Truist considers cash requirements for common and preferred dividends, unfunded commitments to affiliates, serving as a source of strength to Truist Bank, and being able to withstand sustained market disruptions that could limit access to the capital markets. At June 30, 2025, the Parent Company held cash on hand to meet these requirements.

Credit Ratings

Credit ratings are forward-looking opinions of rating agencies as to the Company’s ability to meet its financial commitments and repay its securities and obligations in accordance with their terms of issuance. Credit ratings influence both borrowing costs and access to the capital markets. The Company’s credit ratings are continuously monitored by the rating agencies and are subject to change at any time. As Truist seeks to maintain high-quality credit ratings, management meets with the major rating agencies on a regular basis to provide financial and business updates and to discuss current outlooks and trends. See Item 1A, “Risk Factors” in Truist’s Annual Report on Form 10-K for the year ended December 31, 2024 for additional information regarding factors that influence credit ratings and potential risks that could materialize in the event of downgrade in the Company’s credit ratings.

The following table presents the credit ratings and outlooks of the Parent Company and Truist Bank as of June 30, 2025:


Table 22: Credit Ratings of Truist Financial Corporation and Truist Bank
	Moody’s	S&P	Fitch	DBRS Morningstar
Truist Financial Corporation:
Issuer	Baa1	A- / A-2	A / F1	AAL / R-1M
Senior unsecured	Baa1	A-	A-	AAL
Subordinated	Baa1	BBB+	BBB+	AH
Preferred stock	Baa3(hyb)	BBB-	BBB-	AL
Truist Bank:
Issuer	A3	A / A-1	A / F1	AA / R-1H
Senior unsecured	A3	A	A	AA
Deposits	A1 / P-1	NA	A+ / F1	AA
Subordinated	(P) A3	A-	A-	AAL
Ratings outlook:
Credit trend	Stable	Stable	Stable	Stable

Truist Financial Corporation 73

Capital

The maintenance of appropriate levels of capital is a management priority and is monitored on a regular basis. Truist’s principal goals related to the maintenance of capital are to provide adequate capital to support Truist’s risk profile consistent with the Board-approved risk appetite, provide financial flexibility to support future growth and client needs, comply with relevant laws, regulations, and supervisory guidance, achieve optimal credit ratings for Truist, for the Parent Company to remain a source of strength for the Parent Company’s subsidiaries, and provide a competitive return to shareholders. Risk-based capital ratios, which include CET1 capital, Tier 1 capital, and Total capital are calculated based on regulatory guidance related to the measurement of capital and risk-weighted assets.

Management regularly monitors the capital position of Truist on both a consolidated and bank-level basis. In this regard, management’s objective is to maintain capital at levels that are in excess of internal capital limits, which are above the regulatory “well-capitalized” minimums. Truist also regularly performs stress testing on its capital levels and is required to periodically submit the Company’s capital plans and stress testing results to the banking regulators. Management has implemented internal stress capital ratio minimums that serve as limits which are measured under internally-developed stress testing scenarios to evaluate whether capital ratios calculated under hypothetical stress, and after the effect of alternative capital actions, are likely to remain above internal stressed minimums. Breaches of internal capital limits or projected breaches of internal stress capital ratio minimums under hypothetical stress result in the activation of Truist’s capital contingency plan.


Table 23: Capital Requirements
	Minimum Capital			Well-Capitalized					Minimum Capital Plus Stress Capital Buffer(1)
			Truist			Truist Bank
CET1	4.5	%		NA			6.5	%	7.3	%
Tier 1 capital	6.0			6.0	%		8.0		8.8
Total capital	8.0			10.0			10.0		10.8
Leverage ratio	4.0			NA			5.0		NA
Supplementary leverage ratio	3.0			NA			NA		NA

(1)Reflects a SCB requirement of 2.8% applicable to Truist as of June 30, 2025. Truist’s SCB requirement, received in the 2024 CCAR process, is effective from October 1, 2024 to September 30, 2025. Under the 2025 CCAR process, Truist was notified its preliminary SCB requirement would be 2.5% from October 1, 2025 through September 30, 2026.

The Parent Company’s capital ratios are presented in the following table:


Table 24: Capital Ratios - Truist Financial Corporation
(Dollars in millions)	Jun 30, 2025			Dec 31, 2024
Risk-based:	(preliminary)
CET1	11.0		%	11.5		%
Tier 1 capital	12.3			12.9
Total capital	14.3			15.0
Leverage ratio	10.2			10.5
Supplementary leverage ratio	8.5			8.8
Risk-weighted assets	$	434,892		$	418,337

Capital Contingency Plan

In the event of a realized or potential capital shortfall, Truist has a capital contingency plan that is designed to facilitate improvement of the Company’s capital position through the execution of specific contingency actions which either increase capital, decrease risk-weighted assets, or both. The plan provides a framework designed to monitor for the occurrence of these events by establishing mechanisms to detect capital contraction, including market and economic stress that could adversely impact the Company’s capital position. The plan also establishes governance protocols for activation or deactivation and decision making, lists capital contingency options and associated key information, and addresses the responsibilities of key departments.

Capital ratios remained strong compared to the regulatory requirements for well capitalized banks. Truist’s CET1 ratio was 11.0% as of June 30, 2025, down 30 basis points compared to March 31, 2025 due to capital returned to shareholders and an increase in risk-weighted assets, partially offset by current quarter earnings.

Truist declared common dividends of $0.52 per share during the second quarter of 2025 and repurchased $750 million of common stock. For the second quarter of 2025, the dividend payout ratio was 57%, and the total payout ratio was 121%.

74 Truist Financial Corporation

Truist completed the 2025 CCAR process and received a preliminary SCB requirement of 2.5% for the period October 1, 2025 to September 30, 2026, down 30 basis points from the SCB requirement for the period October 1, 2024 to September 30, 2025. The FRB will provide Truist with its final SCB requirement by August 31, 2025.

Share Repurchase Activity


Table 25: Share Repurchase Activity
(Dollars in millions, except per share data, shares in thousands)	Total Number of Shares Purchased(1)	Average Price Paid Per Share(2)(3)		Total Number of Shares Purchased as part of Publicly Announced Plans	Approximate Dollar Value of Shares that may yet be Purchased Under the Plans(3)(4)
April 1, 2025 to April 30, 2025	20,209	$	37.11	20,209	$	2,750
May 1, 2025 to May 31, 2025	—	—		—	2,750
June 1, 2025 to June 30, 2025	—	—		—	2,750
Total	20,209	$	37.11	20,209

(1)Includes shares exchanged or surrendered in connection with the exercise of equity-based awards under equity-based compensation plans.

(2)Excludes commissions.

(3)Excludes excise taxes on share repurchases.

(4)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. Repurchased shares revert to the status of authorized and unissued shares upon repurchase. The share-repurchase program enables Truist to acquire shares through open-market purchases or privately negotiated transactions, including through Rule 10b5-1 plans and other programs, at the discretion of management and on terms (including quantity, timing, and price) that management determines to be advisable. Actions in connection with the share-repurchase program will be subject to various factors, including Truist's capital and liquidity positions and related internal frameworks, accounting and regulatory considerations (including any restrictions that may be imposed by the FRB and any changes to capital, liquidity, and other regulatory requirements that may be proposed or adopted by the U.S. banking agencies), Truist's financial and operational performance, alternative uses of capital, the trading price of Truist's common stock, and general market conditions. The share-repurchase program does not obligate Truist to acquire a specific dollar amount or number of shares and may be extended, modified, or discontinued at any time.

Regulatory and Supervisory Update

We are subject to significant regulatory frameworks that affect the products and services that we may offer and the manner in which we may offer them, the risks that we may take, the ways in which we may operate, and the corporate and financial actions that we may take.

The description below summarizes an update to the regulatory and supervisory framework applicable to Truist since the filing of the Annual Report on Form 10-K for the year ended December 31, 2024. This update does not summarize all actual, proposed, or possible changes in statutes, regulations, and other laws applicable to Truist and is not intended to be a substitute for those laws. Refer to “Regulatory and Supervisory Considerations” in Truist’s Annual Report on Form 10-K for the year ended December 31, 2024 for additional disclosures.

In December 2024, the CFPB issued a final rule to financial institutions with more than $10 billion in assets to either limit the cost of overdraft services to the amount of their costs and losses or adhere to a fee cap of $5. The rule was expected to take effect on October 1, 2025. In May 2025, the President signed a Congressional Review Act resolution to overturn this rule. As a result, the rule will not become effective and banks with more than $10 billion in assets, including Truist Bank, will not be required to change their overdraft fee structures to comply with the rule.

Truist Financial Corporation 75

Critical Accounting Policies

The accounting and reporting policies of Truist are in accordance with GAAP and conform to the accounting and reporting guidelines prescribed by bank regulatory authorities. Truist’s financial position and results of operations are affected by management’s application of accounting policies, including estimates, assumptions, and judgments made to arrive at the carrying value of assets and liabilities, and amounts reported for revenues and expenses. Different assumptions in the application of these policies could result in material changes in the consolidated financial position or consolidated results of operations, and related disclosures. Material estimates that are particularly susceptible to significant change include the determination of the ACL; determination of fair value for securities, MSRs, trading assets and liabilities, and derivative assets and liabilities; goodwill and other intangible assets; income taxes; and pension and postretirement benefit obligations. Understanding Truist’s accounting policies is fundamental to understanding the consolidated financial position and consolidated results of operations. The critical accounting policies are discussed in MD&A in Truist’s Annual Report on Form 10-K for the year ended December 31, 2024. Significant accounting policies and changes in accounting principles and effects of new accounting pronouncements are discussed in “Note 1. Basis of Presentation” in Form 10-K for the year ended December 31, 2024. Disclosures regarding the effects of new accounting pronouncements are included in “Note 1. Basis of Presentation” in this report. There have been no other changes to the critical accounting policies during 2025.

Goodwill and Other Intangible Assets

The Company’s three reporting units with goodwill balances were CSBB, WB, and Wealth. The Company performs goodwill impairment analysis annually as of October 1 or more often if events or circumstances indicate that it is more-likely-than-not that the fair value of a reporting unit is below its carrying value.

The quantitative valuations of these reporting units use the income approach and a market-based approach, each weighted at 50%. The inputs and assumptions specific to each reporting unit are incorporated in the valuations, including projections of future cash flows, discount rates, and applicable valuation multiples based on the comparable public company information. The income approach utilizes a discounted cash flow analysis of multi-year financial forecasts developed for each reporting unit by considering several inputs and assumptions such as net interest margin, expected credit losses, noninterest income, noninterest expense, and required capital. The market-based approach utilizes comparable public company information, key valuation multiples, and considers a market control premium associated with cost synergies and other cash flow benefits that arise from obtaining control over a reporting unit, and guideline transactions, when applicable.

Truist also assesses the reasonableness of the aggregate estimated fair value of the reporting units by comparison to its market capitalization over a reasonable period of time, including consideration of expected acquirer expense synergies, historic bank control premiums, and the current market.

The projection of net interest margin and noninterest expense are the most significant inputs to the financial projections of the CSBB, WB, and Wealth reporting units. The long-term growth rate used in determining the terminal value of each reporting unit was 3% as of October 1, 2024, based on management’s assessment of the minimum expected terminal growth rate of each reporting unit. Discount rates are estimated based on the Capital Asset Pricing Model, which considers the risk-free interest rate, market risk premium, beta, and unsystematic risk adjustments specific to a particular reporting unit. The discount rates are also calibrated based on risks related to the projected cash flows of each reporting unit. The discount rates utilized for the CSBB, Wealth, and WB reporting units as of October 1, 2024 were 12.5%, 12.0%, and 10.5%, respectively.

Based on the results of the Company’s annual impairment analyses, the Company concluded that the fair values of the CSBB, WB and Wealth reporting units exceeded their respective carrying values; therefore, there was no goodwill impairment. However, for the WB reporting unit, the fair value of the reporting unit exceeded its carrying value by approximately 10%, indicating that the goodwill of the WB reporting unit may remain at risk of impairment. Circumstances that could negatively impact the fair value for the WB reporting unit in the future include a sustained decrease in Truist’s stock price, a decline in industry peer multiples, an increase in the applicable discount rate, and deterioration in the reporting unit’s forecast.

The estimated fair value of a reporting unit is highly sensitive to changes in management’s estimates and assumptions; therefore, in some instances, changes in these assumptions could impact whether the fair value of a reporting unit is greater than its carrying value. The valuation of the WB reporting unit as of October 1, 2024 indicated that if the discount rate were increased more than 100 basis points, with other cash flow assumptions unchanged, the reporting unit’s fair value would be less than its carrying value, indicating a goodwill impairment under the income approach. Ultimately, future potential changes in management’s assumptions may impact the estimated fair value of a reporting unit and cause the fair value of the reporting unit to be below its carrying value. Additionally, a reporting unit’s carrying value could change based on market conditions, change in the underlying makeup of the reporting unit, or the risk profile of those reporting units, which could impact whether the fair value of a reporting unit is less than carrying value.

76 Truist Financial Corporation

The Company monitored events and circumstances during the period from January 1, 2025 to June 30, 2025, 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 October 1, 2024 quantitative impairment test, and the sensitivity of the October 1, 2024 quantitative results to changes in assumptions as of June 30, 2025. 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 June 30, 2025.

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