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Fifth Third Bancorp (NASDAQ:FITB) stock gained as much as 3.2% on Thursday after the firm’s Q4 results were largely in line with expectations, with higher rates and growth in commercial and industrial loan balances lifting net interest income.
The company reported Q4 EPS of $1.01 vs. $0.90 in Q4 2021, while revenue grew 14.3% Y/Y to $2.32B.
Net interest income rose 31.8% Y/Y to $1.58B. Net interest margin was 3.35% vs. 2.55% in Q4 2021.
Provision for credit losses $180M, compared with $47M benefit in Q4 2021. Total average portfolio loans and leases rose 10.9% to $121.37B, reflecting an increase in both commercial and consumer portfolios.
Fifth Third (FITB) expects FY23 total revenue to grow 9–10% Y/Y to $9.25B-$9.34B vs. $9.36B consensus. Average loans and leases are projected to increase 3–4%, while net interest income is estimated to be $6.36B-$6.41B, up 13-14%. The outlook assumes Fed funds rate of 4.75%. Allowance for credit losses is expected to increase ~$100M per quarter.
Fifth Third (FITB) expects Q1 revenue of $2.24B-$2.27B, down 4–5% sequentially vs. $2.29B consensus. Net interest income is projected is decrease 1–2% to $1.55B-$1.57B, while average loans and leases are expected to remain stable.
Read why SA contributor Mike Zaccardi believes Fifth Third (FITB) shares are turning the corner.
