SunTrust Banks (STI) Tops Q2 EPS by 19c, Revenues Beat

SunTrust Banks (NYSE: STI) reported Q2 EPS of $1.49, $0.19 better than the analyst estimate of $1.30. Revenue for the quarter came in at $2.34 billion versus the consensus estimate of $2.33 billion.

Income Statement

• Net income available to common shareholders was $697 million, or $1.49 per average common diluted share, compared to $1.29 for the prior quarter and $1.03 for the second quarter of 2017.
• Total revenue increased 4% sequentially and 3% year-over-year. These increases were driven largely by higher net interest income as a result of net interest margin expansion. The sequential increase was also driven by growth in earnings assets.
• Net interest margin was 3.28% in the current quarter, up 4 basis points sequentially and up 14 basis points compared to the prior year. The sequential and year-over-year increases were driven primarily by higher earning asset yields arising from higher benchmark interest rates, positive mix shift in the LHFI portfolio, and higher securities yields.
• Provision for credit losses was relatively stable sequentially and decreased $58 million year-over-year due primarily to a lower allowance for loan and lease losses ("ALLL").
• Noninterest expense decreased 2% sequentially and remained stable year-over-year. The sequential decrease was driven primarily by a seasonal decline in employee benefits costs.
• The efficiency and tangible efficiency ratios for the current quarter were 59.4% and 58.7%, respectively, which reflect good improvements compared to the prior quarter and prior year, driven by ongoing expense management initiatives and strong revenue growth. The sequential improvement was also impacted by the seasonal decline in employee benefits costs.

"Our performance continues to improve and this quarter was no exception, with earnings per share increasing by 45% year-over-year," said William H. Rogers, Jr., chairman and CEO of SunTrust Banks, Inc. "Importantly, our strategic consistency and improved execution is driving success across multiple fronts: solid revenue growth, improved efficiency, and increased capital returns. We have good momentum going into the second half of the year and I remain confident in our ability to continue to create value for our clients, teammates, communities, and shareholders."

For earnings history and earnings-related data on SunTrust Banks (STI) click here.

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