Truist completes sale of Truist Insurance Holdings and executes strategic balance sheet repositioning

CHARLOTTE, N.C.May 7, 2024 /PRNewswire/ — Truist Financial Corporation (NYSE: TFC) today announced the completion of the previously announced sale of its remaining stake in Truist Insurance Holdings, the fifth largest insurance brokerage in the United States, to an investor group led by private equity firms Stone Point Capital, Clayton, Dubilier & Rice, Mubadala Investment Company and other co-investors.

“We are pleased to have completed the sale of TIH, and we look forward to maintaining a strong partnership with TIH into the future,” said Truist Chairman and Chief Executive Officer Bill Rogers. “The sale of TIH significantly enhances Truist’s financial profile and positions Truist to invest in and grow its core banking businesses.”

At closing, Truist received after-tax cash proceeds of approximately $10.1 billion. The transaction resulted in an approximate after-tax gain of $4.7 billion and increased CET1 capital by $9.4 billion1,2. On a pro-forma basis, Truist’s March 31, 2024, CET1 capital ratio increased by 230 basis points to 12.4% and its tangible book value per share increased by $7.16 or 33% to $28.80.  Truist’s estimated CET1 ratio under proposed fully phased-in Basel III capital rules increased by 254 basis points to 8.4%3 at March 31, 2024.

Following the completion of the sale, Truist executed a strategic balance sheet repositioning of a portion of its available-for-sale investment securities portfolio by selling $27.7 billion of lower-yielding investment securities, resulting in an after-tax loss of $5.1 billion in the second quarter of 2024.  The investment securities that were sold had a book value of $34.4 billion and a weighted average book yield of 2.80% for the remainder of 2024 including the impact of hedges and based on the Federal Funds futures curve4. Including the tax benefit, the repositioning generated $29.3 billion available for reinvestment.

Truist invested approximately $18.7 billion of the $39.4 billion available in shorter duration investment securities yielding 5.27%.  The remaining $20.7 billion will be held in cash.  The blended reinvestment rate on the new investment securities purchased and cash is 5.22% for the remainder of 2024 including the impact of hedges and based on the Federal Funds futures curve4.

The balance sheet repositioning reduced Truist’s pro-forma CET1 capital ratio at March 31, 2024, by 107 basis points to 11.4%2. Truist’s estimated pro-forma CET1 ratio at March 31, 2024, under proposed fully phased-in Basel III capital rules increased from 8.4% to 8.9%5. There is no impact to pro-forma tangible book value per share of $28.80.

Truist estimates that the proceeds from the sale of TIH and the balance sheet repositioning will add $160 million to net interest income in the second quarter of 2024 and $710 million (inclusive of the second quarter impact) to net interest income in 2024 based on the Federal Funds futures curve4.

Truist previously provided an outlook for 2024 second-quarter and full-year revenue, which excluded any benefit of interest income earned on the proceeds from the sale of TIH or from a balance sheet repositioning. Truist is adjusting its previous outlook to reflect the interest income expected on the proceeds from the sale of TIH and from the balance sheet repositioning. Truist now expects second quarter 2024 revenue to increase by approximately 1% over first quarter 2024 revenue of $4.9 billion compared to its previous outlook for revenue to decline by approximately 2%. In addition, Truist now expects full year 2024 revenue to decline by 0.5% to 1.5% over 2023 annual revenue of $20.2 billion compared to its previous outlook for revenue to decline by 4% to 5%.

  1. $9.4 billion of capital comprised of a $4.7 billion after-tax gain and a $4.6 billion benefit from the deconsolidation of TIH’s intangibles net of deferred tax liabilities.
  2. Numbers may not add due to rounding.
  3. CET1 impact greater under fully phased-in Basel III rules primarily due to a reduction in threshold deductions.
  4. Federal Funds futures curve as of May 6, 2024.
  5. CET1 under fully phased-in proposed Basel III rules increases following the balance sheet repositioning due to a reduction in threshold deductions and a lower risk-weighting on the securities purchased than the securities sold.

About Truist

Truist Financial Corporation is a purpose-driven financial services company committed to inspiring and building better lives and communities. As a leading U.S. commercial bank, Truist has leading market share in many of the high-growth markets across the country. Truist offers a wide range of products and services through our wholesale and consumer businesses, including consumer and small business banking, commercial banking, corporate and investment banking, wealth management, payments, and specialized lending businesses. Headquartered in Charlotte, North Carolina, Truist is a top-10 commercial bank with total assets of $535 billion as of March 31, 2024. Truist Bank, Member FDIC. Learn more at Truist.com.

Shopping Cart

Media Kit

    Data Protection

    Personal Data (“Data”) submitted for Media Kit (“Media Kit”), and/or collected in the form of first name, last name, email address and other contact details may be used for the purposes of inviting you to future events and for reaching out to you with content which may be of interest to you. For these purposes, The Digital Banker will share the Data with our associate companies (including event and content sponsors) to promote their products and services. You will also be automatically subscribed as a user on www.thedigitalbanker.com. If you would like to opt-out, email us at [email protected].

    By clicking Submit, you acknowledge that you consent/ have sufficient informed consent to the collection, use and disclosure of Data as set out above.

    The Digital Banker Summit

    Moving on from FTX: is 2023 the year of CBDCs?

    Indonesia, Jakarta

    Thailand, Bangkok

    Philippines, Manila

    Contact Us

      Data Protection

      The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

      Request Nomination Pack

        Data Protection

        The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

        Registration Form

          Data Protection

          The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

          Registration Form

            Data Protection

            The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

            Registration Form

              Data Protection

              The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

              Registration Form

                Data Protection

                The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

                Registration Form

                  Data Protection

                  The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

                  The world’s preeminent Private Banks and Wealth Managers are demonstrating a committed drive in innovation, advisory, new products and services to meet the sophisticated needs of their clients.

                  COVID-19
                  Amid economic activity revival on the back of the Covid-19 vaccine program, organisations moving from business continuity plans to stable working environments, together with the slightest improvement in unemployment numbers, forced the world to adjust to new realities. Coming to terms with the “new normal”, global investors are now on the look-out for attractive and stable investment opportunities.

                  Needs of Private Wealth customers and families worldwide have drastically changed due to the pandemic and banks have had to accelerate efforts to deploy a multi-channel service strategy and safeguard clients’ businesses and wealth against negative impacts of economic uncertainly.

                  The Global Private Banking Innovation Awards will recognise the world’s best private banks, wealth managers and asset managers that are championing innovation across advisory, service, products, customer experience and more.

                  Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. 

                  Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum.

                  Request Nomination Pack

                  Error: Contact form not found.