FITB 10-K & 10-Q changes, risk factors and insider trading
Fifth Third Bancorp (also FITB-PA, FITB-PI, FITB-PK, FITB-PM) · NYSE · State Commercial Banks · CIK 35527 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “27 Fifth Third Bancorp”
New heading “Fifth Third and its service providers are exposed to cybersecurity risks, including risk of cyber-attacks and other information security breaches, which create both operational and reputational risk for the Bank and its customers across all lines of business.”
New heading “New technological advancements, such as AI, may subject Fifth Third to additional risks.”
New heading “Changes in the market could impact Fifth Third’s mortgage banking business.”
New heading “Severe weather events may impact Fifth Third’s loan portfolio and operations.”
New heading “RISKS RELATING TO THE ACQUISITION AND INTEGRATION OF COMERICA INCORPORATED (“THE COMERICA MERGER”)”
New heading “Fifth Third expects to incur substantial expenses related to the Comerica Merger and to the integration of Comerica.”
New heading “Fifth Third may fail to realize all of the anticipated benefits of the Comerica Merger, or those benefits may take longer to realize than expected due to factors that may be outside Fifth Third’s or Comerica’s control. Fifth Third may also encounter significant difficulties in integrating Comerica.”
New heading “Fifth Third’s future results may suffer if Fifth Third does not effectively manage its expanded operations following the Comerica Merger.”
Removed heading “Fifth Third may have more credit risk and higher credit losses to the extent loans are concentrated by exposure to individual borrowers or the location or industry of borrowers or collateral.”
Removed heading “25 Fifth Third Bancorp”
Removed heading “The effects of global physical climate risks, severe weather events or health emergencies may have an effect on the performance of Fifth Third’s loan portfolios, thereby adversely impacting its results of operations.”
Removed heading “Fifth Third is exposed to cybersecurity risks that create both operational and reputational risk for the Bank and its customers across all lines of business.”
Removed heading “New technological advancements may subject Fifth Third to additional risks.”
Removed heading “Fifth Third may experience operational disruption from the effects of climate change.”
Removed heading “Fifth Third may be required to repurchase residential mortgage loans or reimburse investors and others as a result of breaches in contractual representations and warranties.”
Removed heading “32 Fifth Third Bancorp”
Removed heading “Fifth Third could face serious negative consequences if its third-party service providers, business partners, customers or investments fail to comply with applicable laws, rules or regulations.”
Removed heading “34 Fifth Third Bancorp”
Removed heading “Fifth Third’s mortgage banking net revenue can be volatile from quarter to quarter.”
Removed heading “Fifth Third has businesses other than banking that are subject to a variety of risks.”
Removed heading “Societal responses to climate change could adversely affect Fifth Third’s business and performance, including indirectly through impacts on Fifth Third’s customers.”
Largest changes
“Any failures or disruptions of the Bancorp’s systems or operations could give rise to losses in service to customers and clients, adversely affect the Bancorp’s business and results of operations by subjecting the Bancorp to losses or liability, or require the Bancorp to expend significant resources to correct the failure or disruption, as well as by exposing the Bancorp to reputational harm, litigation, regulatory fines or penalties or losses not covered by insurance. …”see in full comparison
Fifth Third is subject to extensive federal and state regulation, supervision and legislation that govern almost all aspects of its operations and limit the businesses in which Fifth Third may engage. This includes many regulations related to Fifth Third’s banking, investment banking, securities underwriting, market making, investment management and retail and institutional brokerage services businesses offered through the Bancorp’s subsidiaries. These laws and regulations may change from time to time and are primarily intended for the protection of consumers, borrowers and depositors and are not designed to protect security-holders.see in full comparisonIn the past decade, the scope of the laws and regulations and the intensity of the supervision to which Fifth Third is subject increased in response to the 2008-2009 financial crisis as well as other factors such as technological and market changes.Compliance with these laws and regulations has resulted in and will continue to result in additional costs, which could be significant, and may have a material and adverse effect on Fifth Third’s results of operations. In addition, if Fifth Third does notappropriatelycomply withcurrent or futureapplicable legislation and regulations,especially those that apply to its consumer operations, which has been an area of heightened focus,Fifth Third may be subject to litigation, fines, penalties or judgments, or material regulatory restrictions on its businesses, which could adversely affect operations and, in turn, financialresults. Additionally, actions by regulatory agenciesresults, orsignificant litigation against Fifth Third could cause it to devote significant time and resources to defending itself and may lead to penaltiesthat materially adversely affectFifth Third andits shareholders. Future changes in laws or regulations(including tax laws and regulations such as the Inflation Reduction Act)or their interpretations or enforcement may also be materially adverse to Fifth Third and its shareholders or may require Fifth Third to expend significant time and resources to comply with such requirements.In addition, as climate change issues become more prevalent, the U.S. and foreign governments are beginning to respond to these issues. The evolving federal and state government focus on climate change may result in new environmental regulations, including disclosure requirements from other jurisdictions in which the Bank operates that could result in additional compliance costs.Similarly, the impact of domestic and international events related to financial crime such as fraud, moneylaundering,laundering and economic sanctions will continue to be an area of constant change,risk,risk and regulatory focus which pose ongoing regulatory, compliance, operational and financial risks.
“27 Fifth Third Bancorp proactively address these techniques or to implement adequate preventative measures. Threat actors, including nation state attackers, could also use artificial intelligence for malicious purposes, increasing the frequency, complexity and effectiveness of their attacks. …”see in full comparison
“Fifth Third’s risk management framework seeks to mitigate risk and loss. Fifth Third has established processes and procedures intended to identify, measure, monitor, report and manage the types of risk to which it is exposed, including liquidity risk, credit risk, interest rate risk, price risk, legal and regulatory compliance risk, strategic risk, reputational risk and operational risk related to its employees, systems and vendors, among others. …”see in full comparison
“Fifth Third’s risk management framework seeks to mitigate risk and loss. Fifth Third has established processes and procedures intended to identify, measure, monitor, report and manage the types of risk to which it is exposed, including liquidity risk, credit risk, interest rate risk, price risk, legal and regulatory compliance risk, strategic risk, reputational risk and operational risk related to its employees, systems and vendors, among others. …”see in full comparison
“Any failures or disruptions of Fifth Third’s systems or operations, including in connection with outages or disruptions of systems provided by third parties, could adversely affect Fifth Third’s business and results of operations by subjecting Fifth Third to losses or liability, among other negative impacts, including reputational harm, litigation, regulatory fines or penalties or losses not covered by insurance.”see in full comparison
Full comparison: every changed paragraph (162)
The risks and uncertainties listed below present risks that could have a material impact on the Bancorp’s business, financial condition,condition theor results of its operations or its business.operations. Some of these risks and uncertainties are interrelated and the occurrence of one or more of them may exacerbate the effect of others. The risks and uncertainties described below are not the only ones Fifth Third faces. Additional risks and uncertainties not presently known to Fifth Third or that Fifth Third currently believes to be immaterial may also adversely affect its business. SeeRefer “Cautionaryto Notepage Regarding Forward-Looking Statements” elsewhere in this Annual Report on Form 10-K19 for morecautionary information.information regarding forward-looking statements.
When Fifth Third lends money or commits to lend money, the Bancorp incurs credit risk, or the risk of loss if borrowers do not repay their loans, leases, credit cards, derivative obligations or other credit obligations. The performance of these credit portfolios significantly affects the Bancorp’s financial results and condition.condition, Ifincluding the current economic environment were to deteriorate, more customers may have difficulty in repaying their credit obligations which could result in a higher level of credit losses and reserves for credit losses. Fifth Third’s credit risk and credit losses can increase if its loans are concentrated among individual borrowers, borrowers engaged in the same or similar activities, industries or geographies, or to borrowers who as a group may be uniquely or disproportionately affected by economic or market conditions. Refer to the Credit Risk Management subsection of the Risk Management section in Item 7 of this Annual Report for more information on specific concentrations.
Fifth Third reserves for credit losses by establishing reserves through a charge to earnings. The amount of these reserves is based on Fifth Third’s assessment of credit losses expected to be incurred in the credit portfolios, including unfunded credit commitments. The process for determining the amount of the ALLL and the reserve for unfunded commitments is critical to Fifth Third’s financial results and condition. Such determination requires difficult, subjective and complex judgments about the environment, including analysis of economic or market conditions that may impair the ability of borrowers to repay their loans.
Fifth Third reserves for expected credit losses by establishing an allowance for credit losses through a charge to earnings. The amount of this allowance is based on Fifth Third’s assessment of credit losses expected to be incurred in the credit portfolios, including unfunded commitments, and requires difficult, subjective and complex judgments about the environment, including analysis of economic or market conditions that may impair the ability of borrowers to repay their loans. Fifth Third may underestimate the credit losses expected to be incurred in its portfolios and have credit losses in excess of the amount reserved. Alternatively, Fifth Third may increase the reserve because of changing economic or market conditions, including inflation, interest rate fluctuations, higher unemployment, or other factors such as changing protections in credit agreements or changes in borrowers’ behavior. AsFifth anThird example,believes borrowersthat mayboth “strategicallythe default,”ALLL orand discontinuereserve makingfor paymentsunfunded oncommitments theirare realadequate estate-securedto loanscover expected losses at December 31, 2025. However there is no assurance that they will be sufficient to cover all potential future credit losses associated with exposures existing at December 31, 2025, especially if theeconomic valueconditions of the real estate is less than what they owe, even if they are still financially able to make the payments.decline.
Fifth Third believes that both the ALLL and the reserve for unfunded commitments are adequate to cover expected losses at December 31, 2024. However, there is no assurance that they will be sufficient to cover future credit losses associated with exposures existing at December 31, 2024, especially if economic conditions decline. In the event of significant deterioration in economic or market conditions, Fifth Third may be required to increase reserves in future periods, which would reduce earnings.
Fifth Third may have more credit risk and higher credit losses to the extent loans are concentrated by exposure to individual borrowers or the location or industry of borrowers or collateral.
Fifth Third’s credit risk and credit losses can increase if its loans are concentrated among individual borrowers, borrowers engaged in the same or similar activities, industries or geographies, or to borrowers who as a group may be uniquely or disproportionately affected by economic or market conditions. Deterioration in economic conditions, including housing conditions or commodity and real estate values in certain states or locations, could result in materially higher credit losses if loans are concentrated in those locations or by other factors. Fifth Third has significant exposure to businesses in certain economic sectors such as manufacturing, real estate, financial services, insurance and healthcare, and weaknesses in those businesses may adversely impact Fifth Third’s business, results of operations or financial condition. Additionally, Fifth Third has a substantial portfolio of commercial and residential real estate loans, and weaknesses in residential or commercial real estate markets may adversely impact Fifth Third’s business, results of operations or financial condition. Fifth Third also has a portfolio of indirect secured consumer loans, and the depreciation in the value of used vehicles may adversely impact Fifth Third’s business, results of operations or financial condition.
Fifth Third has exposure to counterparties in the financial services industry and other industries and routinely executes transactions with such counterparties, includingwhich brokers and dealers, commercial banks, investment banks, mutual and hedge funds and other institutional clients. Many of Fifth Third’s transactions with other financial institutionsmay expose Fifth Third to credit risk in the event of default of a counterparty or client. In addition, Fifth Third’s credit risk may be affected when the collateral it holds cannot be realized or is liquidated at prices not sufficient to recover the full amount of the loan or derivative exposure. The commercial soundness of many financial institutions may be closely interrelated as a result of credit, trading, clearing or other relationships between the institutions. As a result, concerns about, or a default or threatened default by, one institution could lead to significant market-wide liquidity and credit problems, losses or defaults by other institutions. This is sometimes referred to as “systemic risk” and may adversely affect financial intermediaries, such as clearing agencies, clearing houses, banks, securities firms and exchanges, with which the Bancorp interacts on a daily basis, and therefore could adversely affect Fifth Third.
25 Fifth Third Bancorp
Inability to refinance in public or private capital markets could cause a default that impacts Fifth Third borrowers.
Some Fifth Third customers rely on additional sources of capital from outside the Bancorp. If public or private capital markets are disrupted or unavailable to these borrowers such that they cannot obtain funds for refinancing, those borrowers may experience a shortfall that would leave them unable to honor short-term and/or long-term obligations to the Bancorp.
The effects of global physical climate risks, severe weather events or health emergencies may have an effect on the performance of Fifth Third’s loan portfolios, thereby adversely impacting its results of operations.
Fifth Third’s footprint stretches from the upper Midwestern to lower Southeastern regions of the U.S. and it has offices in many other areas of the country. Some of these regions have experienced severe weather events including hurricanes, tornadoes, fires and other natural disasters. The nature and level of these events and the impact of global climate change upon their frequency and severity cannot be predicted. If large scale events occur, they may significantly impact Fifth Third’s loan portfolios by damaging properties pledged as collateral as well as impairing its borrowers’ ability to repay their loans.
Additionally, the impact of widespread health emergencies may adversely impact Fifth Third’s results of operations, such as the impacts previously experienced from the COVID-19 pandemic. If its borrowers are adversely affected due to a widespread health emergency that impacts Fifth Third employees, vendors or economic growth generally, Fifth Third’s financial condition and results of operations could be adversely affected.
Fifth Third must maintain adequate funding sources in the normal course of business to support its operations and fund outstanding liabilities, as well as meet regulatory expectations. Fifth Third primarily relies on bank deposits to be a low cost and stable source of funding for the loans it makes and the operation of its business. Core deposits, which include transaction deposits and certificates of deposit $250,000 or less, have historically provided Fifth Third with a sizeable source of relatively stable and low-cost funds (average core deposits funded 77% of average total assets for the year ended December 31, 20242025). In addition to customer deposits, sources of liquidity include investments in the securities portfolio, Fifth Third’s sale or securitization of loans in secondary markets, the pledging of loans and investment securities to access secured borrowing facilities through the FHLB and the FRB and Fifth Third’s ability to raise funds in money markets and capital markets.
27 Fifth Third Bancorp
•increased collateral requirements including those driven by a decline in the market value of the financial instruments;
•increased collateral requirements;
•reductions in one or more of Fifth Third’s creditagency ratings;
A reduction in Fifth Third’s credit rating could adversely affect its ability to retain deposits, borrow funds (including by raising the cost of borrowings substantially) and could cause creditors and business counterparties to raise collateral requirements or take other actions that could adversely affect Fifth Third’s ability to raise liquidity or capital. Many of the above conditions and factors may be caused by events over which Fifth Third has little or no control. There can be no assurance that significant disruption and volatility in the financial markets will not occur again in the future.
IfMany of the above conditions and factors may be caused by events over which Fifth Third ishas unable to continue to fund assets through customer bank depositslittle or accessno capitalcontrol. There can be no assurance that significant disruption and volatility in the financial markets onwill favorablenot termsoccur or if Fifth Third suffers an increaseagain in borrowingthe costs or otherwise fails to manage liquidity effectively, Fifth Third’s liquidity, operating margins and financial results and condition may be materially adversely affected.future. Fifth Third may also need to raise additional capital and liquidity through the issuance of stock, which could dilute the ownership of existing stockholders, or reduce or even eliminate common stock dividends or share repurchases to preserve capital and liquidity.
Fifth Third’s ability to access the capital markets is important to its overall funding profile. This access is affected by the ratings assigned by rating agencies to Fifth Third, certain of its subsidiaries and particular classes of securities they issue. The interest rates that Fifth Third pays
26Fifth Third’s access to capital markets is a key component of its funding strategy and is influenced by ratings assigned by rating agencies to Fifth ThirdThird, Bancorpcertain on its securities are also influenced by, among other things, the credit ratings that it,of its subsidiaries and/or itsparticular classes of securities receivethey fromissue. recognizedThese ratingratings agencies.also affect the interest rates that Fifth Third pays when issuing new debt securities. A downgrade to Fifth Third or its subsidiaries’ credit rating could limit its access to the capital markets, affect its ability to accessretain thedeposits, capitalcause markets,creditors and business counterparties to raise collateral requirements, increase its borrowing costs and negatively impact itsreduce profitability. AAdditionally, ratingsdowngrades downgrademay to Fifth Third, its subsidiaries or their securities could also createtrigger obligations or create liabilities of Fifth Third under the terms of itsFifth outstandingThird’s securitiesexisting arrangements that could increase Fifthcosts, Third’simpair coststhe ormarketability of affected securities, prompt further downgrades and otherwise have a negative effect on itsFifth Third’s financial condition or results of operationsoperations. There can be no assurances that Fifth Third or financialits condition.subsidiaries will retain any specific rating from any specific rating agency.
Additionally, a downgrade of the credit rating of any particular security issued by Fifth Third or its subsidiaries could negatively affect the ability of the holders of that security to sell the securities and the prices at which any such securities may be sold.
Other rating agencies may also take actions to downgrade their ratings of the securities issued by Fifth Third or its subsidiaries. There can be no assurances that Fifth Third or its subsidiaries will retain any specific rating from any specific rating agency.
Fifth ThirdThe Bancorp is a separate and distinct legal entity from its subsidiaries.subsidiaries Fifth Third Bancorpand typically receives substantially all of its revenue from dividends from its subsidiaries. These dividends are the principal source of funds to pay dividends on Fifth Thirdthe Bancorp’s stock and interest and principal on its debt. The ability of Fifth Third Bancorp’sits subsidiaries to pay dividends or make other payments or distributions depends on their respective operating results and may be restricted by, among other things, regulatory constraints, prevailing economic conditions (including interest rates) and financial, business and other factors, many of which are beyond the control of Fifth Third Bancorp. Various federal and/or state laws and regulations, as well as regulatory expectations, limit the amount of dividends that the Bancorp’s banking subsidiary and certain nonbank subsidiaries may pay to the Bancorp. Regulatory scrutiny of liquidity and capital levels at BHCs and insured depository institutionsbanks has resulted in increased regulatory focus on all aspects of capital planning, including dividends and other distributions to shareholders of banks such as the parent BHCs.distributions. In addition, Fifth Thirdthe Bancorp’s right to participate in a distribution of assets upon a subsidiary’s liquidation or reorganization is subject to the prior claims of that subsidiary’s creditors.
Regulatory limitations on the Bancorp’s ability to receive dividends from its subsidiaries, economic conditions and other financial or business factors could have a material adverse effect on itsthe Bancorp’s liquidity and ability to pay dividends on stock or interest and principal on its debt and to engage in share repurchases. For further information, refer to Regulation and Supervision in Item 1 of this Annual Report on Form 10-K and Note 3 of the Notes to Consolidated Financial Statements.
Fifth Third is exposed to cybersecurity risks that create both operational and reputational risk for the Bank and its customers across all lines of business.
In today’s digital world, more and more of Fifth Third’s business is conducted primarily via digital and mobile technology and information management systems. This includes the use of cloud computing, digital applications and third-party providers that host and store sensitive employee and customer information. Failures, interruptions of service or breaches in the security of these environments occur across the financial services industry with some frequency, including at Fifth Third and its third-party providers. If an event of this nature occurred at Fifth Third or one of its third-party providers and such event proved to be material, this could result in disruptions to Fifth Third’s accounting, deposit, lending and other systems, and adversely affect its customer relationships. While Fifth Third heavily invests in information security, technical resiliency, business continuity and disaster recovery planning, and has policies and procedures designed to detect, limit, and prevent the impact of these possible events, there can be no assurance that any such failure, interruption or security breach will not occur or, if any does occur, that it can be remediated in such a way to eliminate the risk.
There will always be efforts on the part of threat actors to breach information security at financial institutions or with respect to financial transactions. There have been several recent instances involving financial services, credit bureaus and consumer-based companies reporting the unauthorized disclosure of client or customer information or the destruction or theft of corporate data, by both private individuals and foreign governments. In addition, because the techniques used to cause such security breaches change frequently, often are not recognized until launched against a target and may originate from remote and less regulated areas around the world, Fifth Third may be unable to
27 Fifth Third Bancorp proactively address these techniques or to implement adequate preventative measures. Threat actors, including nation state attackers, could also use artificial intelligence for malicious purposes, increasing the frequency, complexity and effectiveness of their attacks. Despite Fifth Third’s efforts to prevent a cyber-attack and monitoring of data flow inside and outside Fifth Third, due to the increasing sophistication of techniques used by attackers to conceal access to systems, a successful cyber-attack could persist for an extended period of time before being detected, and, following detection, it could take considerable time for Fifth Third to obtain full and reliable information about the cybersecurity incident and the extent, amount and type of information compromised. During the course of an investigation, Fifth Third may not necessarily know the full effects of the incident or how to remediate it, and actions and decisions that are taken or made in an effort to mitigate risk may further increase the costs and other negative consequences of the incident. Furthermore, financial services companies are regularly the target of cyber-attacks such as distributed denial of service, social engineering and ransomware attacks. The unintentional or willful acts or omissions of employees also remains the primary avenue through which threat actors attempt to gain access to company networks, information systems, data and credentials.
An additional risk is the use of third- and fourth-party providers to host critical data and platforms for Fifth Third, or in some cases provide services to Fifth Third domestically and internationally. Fifth Third has a third-party risk program to oversee third- and fourth-party providers. This does not eliminate all risk and its failure to do so could result in customer losses, operational issues, litigation, regulatory actions and reputational damage. Industry trends demonstrate a shift towards the use of cloud providers, Software as a Service partners and hosted platforms rather than traditional software services that can be operated from within a company’s firewall and data centers, and the implementation and development of new and emerging technologies such as artificial intelligence. These additional risks are further heightened through the increasing use of near real-time money movement solutions such as Zelle, and increase the difficulty to detect, prevent and recover fraudulent transactions. These additional risks are increasing the costs of Fifth Third’s investment in technology and cybersecurity and require further investment in cyber-related and data loss event insurance which Fifth Third has in place. Though Fifth Third has insurance against some cybersecurity risks and attacks, it may not be sufficient to offset the impact of a material loss event. Future investment in these areas could have higher than expected costs and/or result in operating inefficiencies, which could increase the costs associated with the implementation as well as ongoing operations.
If personal, confidential or proprietary information of customers or clients in the Bancorp’s or such vendors’ or other third-parties’ possession were to be mishandled or misused, the Bancorp could suffer significant regulatory consequences, reputational damage and financial loss.
Fifth ThirdThird’s reliesbusiness is dependent on itsthe systemsavailability and certainperformance of operational and information technology systems, including those provided by third-party service providersproviders. and certain failures (including those related to cybersecurityInterruptions or weather events exacerbated by climate change)failures could materially adversely affect operations.
Fifth Third’s operations depend on operational and information technology systems, including financial, accounting, transaction-execution, and other operational systems, as well as devices, hardware, and networks supporting those systems, all of which may be operated by both Fifth Third and/or by third-party service providers.
Failure, disruption, interruption or outage to any system may cause disruptions in critical business operations such as the ability to use accounting, deposit, loan, payment and other systems. It could also cause unfavorable effects to clients and customers, including delays or other disruptions in services, limitations on Fifth Third’s ability to collect data needed for its business, inability to settle or clear transactions, the possibility that fund transfers are completed erroneously and fraudulent transactions. While Fifth Third invests in automation and emerging technologies such as AI, to prevent, detect and remedy any interruptions or failures, manual oversight remains a critical component of its risk mitigation strategy. Exception handling and control testing are employed to help identify and remediate errors that may not be captured through automated processes. Despite these controls, failures are still possible and could result in operational disruptions or financial loss.
In addition, any security compromise or information technology system disruptions in the financial services industry could interrupt Fifth Third’s business or operations, harm its reputation, erode borrower confidence, negatively affect Fifth Third’s ability to attract new members, or subject it to third-party lawsuits, regulatory fines or other action or liability, which could adversely affect Fifth Third’s business and results of operations.
Risks of operational failures, disruptions or outages in Fifth Third’s operational and information technology systems, and those provided by third-party providers, can result from a variety of factors, only some of which may be wholly or partially within the control of Fifth Third, its third-party providers or the financial services industry more generally. Such events could affect Fifth Third’s systems or limit Fifth Third’s ability to use information technology due to effects on underlying infrastructure. Although Fifth Third regularly updates and replaces systems that it depends on, financial institutions generally continue to utilize some older systems alongside newer systems. Causes of system failures, disruptions or outages may be difficult to detect. While the Bancorp believes that its current business continuity plans are adequate, there can be no assurance that such plans will fully mitigate all potential risks to Fifth Third, its customers or its clients.
Third-party service providers with which Fifth Third does business, as well as vendors and other third parties with which Fifth Third’s customers do business, can also be sources of operational risk to Fifth Third, particularly where processes are highly concentrated or customer activities are beyond Fifth Third’s security and control systems, such as through the use of the internet, personal computers, tablets, smart phones and other mobile services. Fifth Third could also be held responsible for the failure of third-party service providers, as well as other third parties, to comply with applicable laws, rules or regulations.
Any failures or disruptions of Fifth Third’s systems or operations, including in connection with outages or disruptions of systems provided by third parties, could adversely affect Fifth Third’s business and results of operations by subjecting Fifth Third to losses or liability, among other negative impacts, including reputational harm, litigation, regulatory fines or penalties or losses not covered by insurance.
Fifth Third and its service providers are exposed to cybersecurity risks, including risk of cyber-attacks and other information security breaches, which create both operational and reputational risk for the Bank and its customers across all lines of business.
Fifth Third’s business is conducted primarily via digital and information technology systems. This includes the use of digital applications, cloud computing and third- and fourth-party providers that host and store customer, employee and operational information.
Failures, service interruptions, breaches or attempted breaches in the security of these environments occur frequently across the financial services industry including at Fifth Third and its third- and fourth-party providers. If a material event of this nature occurred at Fifth Third or one of its third- or fourth-party providers, it could result in disruptions to Fifth Third’s accounting, deposit, lending and other systems, and adversely affect its customer relationships.
Fifth Third invests in information security, technical resiliency, business continuity and disaster recovery planning, and has policies and procedures designed to detect, limit, and prevent the impact of these possible events, and requires its third-party service providers to maintain similar controls. Despite this, there can be no assurance that any cyber-attacks, security breaches or system failures or interruptions will not occur or, if any do occur, that it can be remediated in such a way to eliminate the risk.
Financial institutions are the targets of frequent efforts to breach systems, including through denial of service attacks, social engineering such as phishing and smishing, placement of insider threats, and ransomware, among others. Moreover, because the techniques used to cause such security breaches change frequently, may not be recognized until launched against a target and may originate from remote and less regulated areas around the world, Fifth Third may be unable to proactively address these techniques or to implement adequate preventative measures. The increasing interdependence and complexity of financial institutions and infrastructure also means a disruption, compromise or failure that
29 Fifth Third Bancorp affects one segment of the financial services industry could also impact Fifth Third. The prospect that AI may be used to conduct attacks may make them more difficult to detect. Additionally, the growing sophistication of AI increases the risk of cyber-attacks.
Despite Fifth Third’s efforts to prevent a cyber-attack, a successful cyber-attack could persist for an extended period before being detected and, following detection, it could take considerable time for Fifth Third to obtain full and reliable information about the cybersecurity incident and the extent, amount and type of information compromised. During an investigation, Fifth Third may not necessarily know the full effects of the incident or how to remediate it, and actions and decisions that are taken or made in an effort to mitigate risk may further increase the costs and other negative consequences of the incident.
Additionally, Fifth Third uses third- and fourth-party providers to host data, products, services, systems or platforms for Fifth Third, or in some cases to provide services to Fifth Third domestically and internationally. Fifth Third has a third-party risk program to oversee third- and fourth-party providers. This does not eliminate all risk and its failure to do so could result in customer losses, operational issues, litigation, regulatory actions and reputational damage. Even with reasonable investment and diligence by Fifth Third, Fifth Third’s ability to prevent cyber-attacks, security breaches or system failures or interruptions impacting its third- and fourth-party service providers may be limited. Financial services industry trends demonstrate a shift towards the use of cloud providers, Software as a Service partners and hosted platforms rather than traditional software services that can be operated from within a company’s firewall and data centers. The risks relating to security and availability of Fifth Third’s systems are further heightened through the increasing use of near real-time money movement solutions such as Zelle, and increase the difficulty to detect, prevent and recover fraudulent transactions. While controls are robust, the speed and automation of these systems introduce a risk of erroneous transactions that could result in financial loss. These additional risks are increasing the costs of Fifth Third’s investment in technology and cybersecurity and require further investment in cyber-related and data loss event insurance which Fifth Third has in place. Though Fifth Third has insurance against some cybersecurity risks and attacks, it may not be sufficient to offset the impact of a material loss event; and, Fifth Third cannot guarantee that cybersecurity insurance policies will not deny coverage, or that existing insurance coverage will continue to be available on acceptable terms. Future investment in these areas could have higher than expected costs and/or result in operating inefficiencies, which could increase the costs associated with the implementation as well as ongoing operations.
Further, clients and customers use their own devices to utilize mobile banking and online services. Not all of Fifth Third’s clients, customers or counterparties have appropriate controls in place to protect information exchanged between them and Fifth Third. This may create new security risks and increase the likelihood of security incidents impacting customers’ information. Customers’ information may not always be protected by third-party applications or other third-party technology used in connection with such services. This can result and has resulted in fraud.
Fifth Third’s operations, including its financial and accounting systems, use computer systems and telecommunications networks operated by both Fifth Third and third-party service providers. Fifth Third may not be sufficiently resilient and may not recover from significant operational events in a timely manner which could create operational and reputational risks. Additionally, Fifth Third collects, processes and stores sensitive consumer data by utilizing those and other systems and networks. Fifth Third has security, backup and recovery systems in place, as well as a business continuity plan to ensure the systems will not be inoperable. Fifth Third also has security to prevent unauthorized access to the systems. In addition, Fifth Third requires its third-party service providers to maintain similar controls. However, Fifth Third cannot be certain that the measures will be successful, particularly given the rapidly evolving sophistication of threat actors and technologies.
A security breach in theseimpacting systems operated by or on behalf of Fifth Third, or the loss or corruption of confidential information such as customer data, business results, and transaction records and related information could adversely impact Fifth Third in numerous material ways, including by requiring public notification about the incident, causing financial losses, impacting Fifth Third’s ability to provide timely and accurate financial information in compliance with legal and regulatory requirements, all of which could result in sanctions from regulatory authorities,sanctions, significantlitigation, reputational harmharm, monetary loss and the loss of customer confidence in Fifth Third. Additionally, security breaches orinvolving the loss, mishandling, theft or corruption of customer information such as social security numbers, credit card numbers, account balances or otherclient information could result in adverse consequences including financial losses byto Fifth Third's customers, litigation, regulatory sanctions, lost customers and revenue, increased costs and significant reputational harm.
For more detail on Fifth Third’s cybersecurity governance structure and practices, see Item 1C of this Annual Report.
Fifth Third’s necessary dependence upon automated systems to record and process its transaction volume poses the risk that technical system flaws or employee errors, tampering or manipulation of those systems could result in losses and may be difficult to detect. Fifth Third may also be subject to disruptions of its operating systems arising from events that are beyond its control (for example, cyber-attacks, equipment failure, or electrical or telecommunications outages).
Third-party service providers with which the Bancorp does business both domestically and offshore, as well as vendors and other third parties with which the Bancorp’s customers do business, can also be sources of operational risk to the Bancorp, particularly where processes are highly concentrated or in widespread use on critical Bancorp systems, or activities of customers are beyond the Bancorp’s security and control systems, such as through the use of the internet, personal computers, tablets, smart phones and other mobile services. Security breaches or system failures affecting the Bancorp or its third-party providers can increase operational costs and reduce customer satisfaction, as the Bancorp takes steps to protect its systems and safeguard confidential information. If personal, confidential or proprietary information of customers or clients in the Bancorp’s or such vendors’ or other third parties’ possession were to be mishandled or misused, the Bancorp could suffer significant regulatory consequences, reputational damage and financial loss. Such mishandling or misuse could include circumstances where, for example, such information was erroneously provided to parties who are not permitted to have the information, either through the fault of the Bancorp’s systems, employees or counterparties, or where such information was intercepted or otherwise compromised by threat actors. The Bancorp may be subject to disruptions of its operating systems arising from events that are wholly or partially beyond the
Bancorp’s control, which may include, for example, security breaches; electrical or telecommunications outages; failures of computer components or servers or other damage to the Bancorp’s property or assets; natural disasters or severe weather conditions; health emergencies; or events arising from local or larger-scale political events, including outbreaks of hostilities or terrorist acts. While the Bancorp believes that its current business continuity plans are both sufficient and adequate, there can be no assurance that such plans will fully mitigate all potential business continuity risks to the Bancorp or its customers and clients.
Any failures or disruptions of the Bancorp’s systems or operations could give rise to losses in service to customers and clients, adversely affect the Bancorp’s business and results of operations by subjecting the Bancorp to losses or liability, or require the Bancorp to expend significant resources to correct the failure or disruption, as well as by exposing the Bancorp to reputational harm, litigation, regulatory fines or penalties or losses not covered by insurance. In addition, any security compromise or information technology system disruptions in the financial services industry as a whole, whether actual or perceived, could interrupt the Bancorp’s business or operations, harm its reputation, erode borrower confidence, negatively affect the Bancorp’s ability to attract new members, or subject it to third-party lawsuits, regulatory fines or other action or liability, which could adversely affect Fifth Third’s business and results of operations. The Bancorp could also be adversely affected if it loses access to information or services from a third-party service provider as a result of a security breach or system or operational failure, or disruption affecting the third-party service provider. Fifth Third’s insurance may be inadequate to compensate for failures by, or affecting, third-party service providers upon which Fifth Third relies.
Fifth Third may not be able to effectively manage organizational changes and implement key initiatives in a timely fashion, or at all, due to competing priorities which could adversely affect its business, financial condition, results of operations, financial conditionoperations and reputation.
Fifth Third is subject to rapid changes in technology, regulation and product innovation, and faces intense competition for customers, sources of revenue, capital, services, qualified employees and other essential business resources. In order to meet these challenges, Fifth Third is or may be engaged in numerous critical strategic initiatives at the same time. Accomplishing these initiatives may be complex, time intensive and require significant financial, technological, management and other resources. These initiatives may consume management’s attention and may compete for limited resources. In addition, organizational changes may need to be implemented throughout Fifth Third as a result of the new products, services, partnerships and processes that arise from the execution of these various strategic initiatives. Fifth Third may have difficulty managing these organizational changes and executing these initiatives effectively in a timely fashion, or at all. Fifth Third’s failure to do so could expose it to litigation or regulatory action and may damage Fifth Third’s business, financial condition, results of operations, financial conditionoperations and reputation.
Fifth Third invests significant resources in information technology system enhancements in order to provide functionality and security at an appropriate level for ongoing product development and process re-engineering. Fifth Third may not be able to acquire or protect rights to its licensed or owned intellectual property or successfully implement and integrate future system enhancements, which could adversely impact the ability to provide timely and accurate financial information in compliance with legal and regulatory requirements, which could result in sanctions from regulatory authorities. Such sanctions could include fines and result in reputational harm and have other negative effects. Failure to properly utilize system enhancements that are implemented in the future could result in impairment charges that adversely impact Fifth Third’s financial condition and results of operations and could result in significant costs to remediate or replace the defective components. In addition, Fifth Third may incur significant training, licensing, maintenance, consulting, depreciation expense and amortization expenses during and after systems implementations, and any such costs may continue for an extended period of time. A failure to maintain or enhance Fifth Third’s competitive position with respect to technology, whether because of a failure to anticipate client expectations or other necessary changes, a failure in the performance of technological developments or an untimely roll out of developments, may cause Fifth Third to lose market share or incur additional expense.
New technological advancements may subject Fifth Third to additional risks.
Management's Discussion & Analysis (MD&A)
New heading “Acquisition of Comerica Incorporated”
New heading “Redemption of Preferred Stock”
New heading “50 Fifth Third Bancorp”
New heading “(a)The FTE adjustments included in the above table were $20, $24 and $25 for the years ended December 31, 2025, 2024 and 2023, respectively.”
New heading “(b)This is a non-GAAP measure. For further information, refer to the Non-GAAP Financial Measures section of MD&A.”
New heading “59 Fifth Third Bancorp”
New heading “60 Fifth Third Bancorp”
New heading “(b)Includes FTE adjustments of $20, $24 and $25 for the years ended December 31, 2025, 2024 and 2023, respectively.”
New heading “66 Fifth Third Bancorp”
New heading “December 31, 2025 ACL”
New heading “(a)Represents the difference between Moody’s Baa‑ rated corporate bond yields and U.S. Treasury yields.”
New heading “(a)For the years ended December 31, 2025, 2024 and 2023, the Bancorp recorded $18, $28 and $35, respectively, in both losses charged-off and recoveries of losses previously charged-off related to customer defaults on point-of-sale consumer loans for which the Bancorp obtained recoveries under third-party credit enhancements.”
New heading “(a) Includes $106 and $108 of residential mortgage loans measured at fair value at December 31, 2025 and 2024, respectively.”
New heading “96 Fifth Third Bancorp”
New heading “98 Fifth Third Bancorp”
New heading “(a)Regulatory capital ratios and amounts as of December 31, 2024 and 2023 were calculated pursuant to the five-year transition provision option to phase in the effects of CECL on regulatory capital. This has been fully phased in as of January 1, 2025.”
New heading “(b)Quarterly average assets are a component of the leverage ratio and, for this purpose, do not include goodwill or any other assets that the U.S. banking agencies determine should be deducted from Tier 1 capital.”
New heading “Redemption of Preferred Stock”
New heading “103 Fifth Third Bancorp”
Removed heading “FDIC Special Assessment”
Removed heading “Transfer of Securities”
Removed heading “CFPB Settlements”
Removed heading “48 Fifth Third Bancorp”
Removed heading “57 Fifth Third Bancorp”
Removed heading “(a)The FTE adjustments included in the above table were $24, $25 and $16 for the years ended December 31, 2024, 2023 and 2022, respectively.”
Removed heading “(b)Net interest income (FTE), net interest margin (FTE) and net interest rate spread (FTE) are non-GAAP measures. For further information, refer to the Non-GAAP Financial Measures section of MD&A.”
Removed heading “(a)During 2024, certain noninterest income line items were reclassified to better align disclosures to business activities. These reclassifications were retrospectively applied to all prior periods presented. Total noninterest income did not change as a result of these reclassifications.”
Removed heading “(a)During 2024, certain noninterest expense line items were reclassified to better align disclosures to business activities. These reclassifications were retrospectively applied to all prior periods presented. Total noninterest expense did not change as a result of these reclassifications.”
Removed heading “77 Fifth Third Bancorp”
Removed heading “December 31, 2024 ACL”
Removed heading “(a)For the years ended December 31, 2024, 2023 and 2022, the Bancorp recorded $28, $35 and $32, respectively, in both losses charged-off and recoveries of losses previously charged-off related to customer defaults on point-of-sale consumer loans for which the Bancorp obtained recoveries under third-party credit enhancements.”
Removed heading “(a) Includes $108 and $116 of residential mortgage loans measured at fair value at December 31, 2024 and 2023, respectively.”
Removed heading “93 Fifth Third Bancorp”
Removed heading “(a)Forward starting swaps will become effective on various dates between June 2024 and February 2025.”
Removed heading “97 Fifth Third Bancorp”
Removed heading “100 Fifth Third Bancorp”
Removed heading “(c)Regulatory capital ratios as of December 31, 2024, 2023 and 2022 are calculated pursuant to the five-year transition provision option to phase in the effects of CECL on regulatory capital.”
Removed heading “104 Fifth Third Bancorp”
Largest changes
“The Bancorp is closely monitoring various economic factors and their impacts on commercial borrowers, including, but not limited to, the level of inflation, labor and supply chain issues, volatility and changes in consumer discretionary spending patterns, including debt and default levels. Additionally, despite recent cuts, borrowers are expected to experience lingering effects from higher-for-longer interest rates. The Bancorp maintains focus on disciplined client selection, adherence to underwriting policy and attention to concentrations.”see in full comparison
“(a)For the years ended December 31, 2025, 2024 and 2023, the Bancorp recorded $18, $28 and $35, respectively, in both losses charged-off and recoveries of losses previously charged-off related to customer defaults on point-of-sale consumer loans for which the Bancorp obtained recoveries under third-party credit enhancements.”see in full comparison
“(a)For the years ended December 31, 2024, 2023 and 2022, the Bancorp recorded $28, $35 and $32, respectively, in both losses charged-off and recoveries of losses previously charged-off related to customer defaults on point-of-sale consumer loans for which the Bancorp obtained recoveries under third-party credit enhancements.”see in full comparison
“(b)Quarterly average assets are a component of the leverage ratio and, for this purpose, do not include goodwill or any other assets that the U.S. banking agencies determine should be deducted from Tier 1 capital.”see in full comparison
“The Baseline scenario used in the December 31, 2024 ACL assumed that the normalization of inflation rates will take longer than previously expected when considering recent trends and additional inflationary pressures that may arise from changes in U.S. fiscal, tariff and immigration policies. This scenario assumed a rise in inflation mid-2025, increasing to 2.7% by the end of 2026 and not approaching the 2% target before early 2027. …”see in full comparison
“The Bancorp is closely monitoring various economic factors and their impacts on borrowers, including, but not limited to, the impact of policy changes on trade, ongoing global tensions, inflation, interest rates, labor and supply chain issues, market volatility and changes in”see in full comparison
Full comparison: every changed paragraph (278)
Acquisition of Comerica Incorporated
On February 1, 2026, Fifth Third Bancorp closed the merger with Comerica Incorporated (“Comerica”) in an all-stock transaction valued at approximately $12.7 billion. Under the terms of the merger agreement, each outstanding share of Comerica’s common stock was converted into the right to receive 1.8663 shares of Fifth Third Bancorp common stock and each outstanding share of Comerica’s preferred stock was converted into the right to receive one share of a newly created series of preferred stock with comparable terms issued by the Bancorp.
Refer to Note 32 of the Notes to Consolidated Financial Statements for more information.
Redemption of Preferred Stock
On September 30, 2025, the Bancorp redeemed all 14,000 outstanding shares of its 4.500% fixed-rate reset non-cumulative perpetual preferred stock, Series L, and the corresponding depositary shares, pursuant to its terms and conditions. Prior to the redemption, the dividend rate on the Series L preferred stock was set to reach its first dividend reset date at which time the dividend would have reset to the five-year U.S. Treasury rate plus 4.215%.
Refer to Note 24 of the Notes to Consolidated Financial Statements for more information.
FDIC Special Assessment
In response to the bank failures that occurred in the first half of 2023, the FDIC issued a final rule for a special deposit insurance assessment on banking organizations with greater than $5 billion in assets to recover the losses to the Deposit Insurance Fund associated with protecting uninsured depositors. As of December 31, 2024, the Bancorp’s estimate of its allocation of the special assessment was $252 million, based on the most recent information provided by the FDIC. As a result of this special assessment, the Bancorp recorded expense of $28 million and $224 million during the years ended December 31, 2024 and 2023, respectively, related to this estimate. The Bancorp currently expects to pay the special assessment to the FDIC over a total of ten quarterly assessment periods, which began with the first quarter of 2024. The estimate of the cost associated with protecting the uninsured depositors will continue to be subject to periodic adjustment until the final loss amount is determined by the FDIC.
Accelerated Share Repurchase TransactionsActivity
During the year ended December 31, 2024,2025, the Bancorp enteredrepurchased into$525 andmillion settledof common stock in accelerated share repurchase transactions totaling $625 million. Refer to Note 24 of the Notes to Consolidated Financial Statements for additional information on share repurchase activity.transactions.
On June 13, 2025, the Bancorp’s Board of Directors authorized management to purchase 100 million shares of the Bancorp’s common stock through the open market or in any private party transactions. This authorization superseded the prior authorization from June 2019 and did not include specific targets or an expiration date.
Refer to Note 24 of the Notes to Consolidated Financial Statements for additional information on share repurchase activity.
On January 29,28, 2024,2025, the BancorpBank issued and soldsold, $1.0under billionits bank note program, $700 million of fixed-rate/floating-rate senior notes which will maturedue on January 29,28, 2032.2028. The senior notes will bear interest at a rate of 5.631%4.967% per annum untilto, but excluding, January 28, 2031.2027. FromFrom, and including, January 29,28, 20312027, untilto, maturity,but excluding, the maturity date, the senior notes will bear interest at a rate of compounded SOFR plus 1.840%.0.81%.
On SeptemberJanuary 6,28, 2024,2025, the BancorpBank issued and soldsold, $750under its bank note program, $300 million of fixed-rate/floating-rate senior notes which will maturedue on SeptemberJanuary 6,28, 2030.2028. The senior notes will bear interest at a rate of 4.895% per annum until September 5, 2029. From September 6, 2029 until maturity, the senior notes will bear interest at a rate of compounded SOFR plus 1.486%.0.81%.
Transfer of Securities
In January 2024, the Bancorp transferred $12.6 billion (amortized cost basis) of securities from available-for-sale to held-to-maturity to reflect the Bancorp’s change in intent to hold these securities to maturity in order to reduce potential capital volatility associated with investment security market price fluctuations. The transfer included U.S. Treasury and federal agencies securities, agency residential mortgage-backed securities and agency commercial mortgage-backed securities. Refer to the Investment Securities subsection of the Balance Sheet Analysis section of MD&A for more information.
CFPB Settlements
On July 9, 2024, the Bank and the CFPB agreed to resolve previously outstanding litigation which alleged violations of the Consumer Financial Protection Act, the Truth in Lending Act and Truth in Savings Act. The Bank agreed to the entry of a Stipulated Final Judgment and Order, pursuant to which the Bank, without admitting or denying any of the allegations in the suit except as specified in the order, agreed to pay a civil monetary penalty of $15 million, agreed to maintain existing policies around its consumer sales incentives, agreed to create a compliance plan to ensure its account opening practices comply with law and the order and agreed to provide a redress plan to remediate certain customers with checking, savings, or credit card accounts opened beginning January 1, 2010 and ending December 31, 2016.
Concurrently, the Bank also agreed to entry of a Consent Order related to a since-discontinued program in its auto lending business that placed collateral protection insurance on certain automobile loans. Under this Consent Order, without admitting or denying any of the findings of fact or conclusions of law (except to establish jurisdiction), the Bank agreed to pay a $5 million civil monetary penalty related to those issues, maintain existing policy changes related to its auto servicing practices, agreed to create a compliance plan to ensure its compliance with the order and provide a redress plan to remediate certain customers within a redress period beginning July 21, 2011 and ending December 31, 2020.
Refer to Note 19 of the Notes to Consolidated Financial Statements for additional information on these settlements.
The Bancorp, as a banking institution, utilizes various key indicators of financial condition and operating results in managing and monitoring the performance of the business. In addition to traditional financial metrics, such as revenue and expense trends, the Bancorp monitors other financial measures that assist in evaluating growth trends, capital and liquidity strength and operational efficiencies. The Bancorp analyzes these key performance indicators against its past performance, its forecasted performance and with the performance of its peer banking institutions. These indicators may change from time to time as the operating environment and businesses change.
•CET1 risk-based Capital Ratio: CET1 risk-based capital divided by risk-weighted assets as defined by the Basel III standardized approach to risk-weighting of assets
48 Fifth Third Bancorp
The Bancorp’s net income available to common shareholders for the year ended December 31, 2025 was $2.4 billion, or $3.53 per diluted share, which was net of $146 million of preferred stock dividends. On September 30, 2025, the Bancorp redeemed all outstanding shares of its preferred stock, Series L, resulting in a $4 million reduction to net income available to common shareholders, which was recognized as incremental dividends on preferred stock in the Bancorp’s Consolidated Statements of Income. The Bancorp’s net income available to common shareholders for the year ended December 31, 2024 was $2.2 billion, or $3.14 per diluted share, which was net of $159 million of preferred stock dividends.
The Bancorp’s net income available to common shareholders for the year ended December 31, 2024 was $2.2 billion, or $3.14 per diluted share, which was net of $159 million in preferred stock dividends. The Bancorp’s net income available to common shareholders for the year ended December 31, 2023 was $2.2 billion, or $3.22 per diluted share, which was net of $137 million in preferred stock dividends.
Net interest income on an FTE basis (non-GAAP) was $5.7$6.0 billion for the year ended December 31, 2024,2025, decreasingincreasing $198$348 million compared to the prior year. Net interest income for the year ended December 31, 2025 was negativelypositively impacted by higherlower funding costs due to increasesboth inthe benefit of lower short-term market interest rates and deposit balance migration into higher yielding products as well as a decrease in the average balances of commercialinterest-bearing liabilities. Additionally, higher average balances of loans and industrialleases loansand forfixed therate yearconsumer endedloan Decemberyield 31,improvement 2024.driven by higher intermediate-term and long-term interest rates drove interest income growth. These negativepositive impacts were partially offset by higher yields on average interest-earning assets and an increasedecreases in the average balances of and lower yields on other short-term investments.investments as well as lower yields on average commercial loans and leases driven by lower short-term market rates. Net interest margin on an FTE basis (non-GAAP) was 3.11% for the year ended December 31, 2025 compared to 2.90% for the year ended December 31, 2024 compared to 3.05% for the year ended December 31, 2023.2024.
The provision for credit losses was $530$662 million for the year ended December 31, 20242025 compared to $515$530 million in the prior year. Provision expense for the year ended December 31, 20242025 wasincreased affectedprimarily driven by the impactsfraud-related impairment of deteriorationan inasset-backed the macroeconomic forecast for thefinance commercial portfolio,loan higherwhich period-endincluded loana charge-off of $178 million and leasea balancesspecific andallowance of $20 million, as well as increases in specific reserves on individually evaluated commercial loans,loans and higher period-end loan and lease balances. The increase in provision expense for the year ended December 31, 2025 was partially offset by factors that reduced the ACL from December 31, 2024, including the impacts of changes in consumer loan portfolio mix, improvement inboth the macroeconomicmix forecastand forcredit quality of the consumer loan portfolio and improvements in probability of default ratings on collectively-evaluated commercial loans. Net losses charged off as a percent of average portfolio loans and leases were 0.45%0.60% and 0.32%0.45% for the years ended December 31, 20242025 and 2023,2024, respectively. At December 31, 2024,2025, nonperforming portfolio assets as a percent of portfolio loans and leases and OREO increaseddecreased to 0.71%0.65% compared to 0.59%0.71% at December 31, 2023.2024. For further discussion on credit quality, refer to the Credit Risk Management subsection of the Risk Management section of MD&A as well as Note 6 of the Notes to Consolidated Financial Statements.
Noninterest income decreased $32 million for the year ended December 31, 2024 compared to the year ended December 31, 2023 primarily due to decreases in other noninterest income, mortgage banking net revenue and commercial banking revenue, partially offset by increases in wealth and asset management revenue and commercial payments revenue.
Noninterest expenseincome decreasedincreased $172$186 million for the year ended December 31, 20242025 compared to the year ended December 31, 20232024 primarily due to decreasesincreases in wealth and asset management revenue, commercial payments revenue, consumer banking revenue, mortgage banking net revenue and other noninterest expense and marketing expense,income, partially offset by increasesdecreases in compensationcommercial banking revenue and benefitscapital expense,markets technology and communications expense and net occupancy expense.fees.
Noninterest expense increased $111 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 primarily due to increases in compensation and benefits expense, technology and communications expense and marketing expense, partially offset by a decrease in other noninterest expense.
50 Fifth Third Bancorp
The Bancorp calculated its regulatory capital ratios under the Basel III standardized approach to risk-weighting of assets and pursuant to the five-year transition provision option to phase in the effects of CECL on regulatory capital as of December 31, 2024.2025. As of December 31, 2024,2025, the Bancorp’s capital ratios, as defined by the U.S. banking agencies, were:
•CET1 capital ratio: 10.57%;
•Tier 1CET1 risk-based capital ratio: 11.86%10.81%;
•TotalTier 1 risk-based capital ratio: 13.86%11.87%;
•Total risk-based capital ratio: 13.78%;
Note 1 of the Notes to Consolidated Financial Statements provides a discussion of the significant new accounting standardsstandard applicable to the Bancorp during 20242025 and the expected impact of significant accounting standards issued, but not yet required to be adopted.
Business combinations entered into by the Bancorp typically include the recognition of goodwill. U.S. GAAP requires goodwill to be tested for impairment at the reporting unit level on an annual basis and more frequently if events or circumstances indicate that there may be impairment. As further discussed in Note 1 of the Notes to Consolidated Financial Statements, the Bancorp’s annual goodwill impairment test has historically beenis performed as of September 30 of each year. However, in 2024, the testing was performed as of September 30 and again as of October 1 toeach reflectyear, theand changemore infrequently dateif inevents whichor thecircumstances Bancorpindicate willthat performthere itsmay annualbe goodwill impairment testing in future periods.impairment.
Net interest income on an FTE basis (non-GAAP) was $5.7$6.0 billion for the year ended December 31, 2024,2025, decreasingincreasing $198$348 million compared to the prior year. Net interest income for the year ended December 31, 20242025 was negativelypositively impacted by lower average loan balances as a result of actions taken in 2023 to reduce lower returning facilities as well as decreased demand. Additionally, funding costs remaineddue elevatedto asboth the benefit of lower short-term market rates and a decrease in the average balances of interest-bearing liabilities. Additionally, higher average marketbalances of loans and leases and fixed rate consumer loan yield improvement driven by higher intermediate-term and long-term interest rates continueddrove tointerest driveincome deposit balance migration into higher yielding products.growth. These negativepositive impacts were partially offset by higher yields on average interest-earning assets and an increasedecreases in the average balances of and lower yields on other short-term investments.investments as well as lower yields on average commercial loans and leases driven by lower short-term market rates.
Net interest rate spread on an FTE basis (non-GAAP) was 2.08%2.40% for the year ended December 31, 20242025 compared to 2.24%2.08% during the year ended December 31, 2023.2024. RatesChanges in market rates resulted in a decrease on rates paid on average interest-bearing liabilities increasedof 4255 bps, partially offset by a 26 bps increasedecrease in yields on average interest-earning assets of 23 bps for the year ended December 31, 20242025 compared to the year ended December 31, 2023.2024.
Net interest margin on an FTE basis (non-GAAP) was 3.11% for the year ended December 31, 2025 compared to 2.90% for the year ended December 31, 2024. Net interest margin for the year ended December 31, 2025 was positively impacted by the previously mentioned increase in net interest rate spread and a decrease in the average balances of other short-term investments.
Net interest margin on an FTE basis (non-GAAP) was 2.90% for the year ended December 31, 2024 compared to 3.05% for the year ended December 31, 2023. Net interest margin for the year ended December 31, 2024 was primarily impacted by the previously mentioned impacts of higher market interest rates, migration of average balances of deposits from demand deposits to interest-bearing deposits and a decrease in the average balances of loans and leases. Net interest income was also negatively impacted by elevated balances of other short-term investments during the year ended December 31, 2024. Net interest margin results are expected to modestly increase over the next several quarters driven by fixed-rate asset repricing and moderating deposit costs. However, net interest margin may be negatively impacted by increased deposit competition or higher levels of cash and other short-term investments.
Interest income on an FTE basis (non-GAAP) from loans and leases increaseddecreased $142$14 million from the year ended December 31, 20232024 primarily driven by ana increasedecrease in yields on average commercial loans and leases,leases associated with lower short-term market rates, partially offset by aan decreaseincrease in the average balances of commercialloans and industrialleases loans.and higher yields on average consumer loans due to fixed-rate asset repricing. For more information on the Bancorp’s loan and lease portfolio, refer to the Loans and Leases subsection of the Balance Sheet Analysis section of MD&A. Interest income on an FTE basis (non-GAAP) from investment securities and other short-term investments increaseddecreased $523$513 million from the year ended December 31, 20232024 primarily due to ana increasedecrease in the average balances of other short-term investments andcoupled higherwith lower yields on those balances associated with lower short-term market rates as well as a decrease in the average balances of taxable securities driven by fixed-rate asset repricing.securities.
Interest expense on average core deposits increaseddecreased $852$666 million from the year ended December 31, 20232024 primarily due to ana increasedecrease in the cost of average interest-bearing core deposits to 234 bps for the year ended December 31, 2025 from 287 bps for the year ended December 31, 2024 from 238 bps for the year ended December 31, 2023, as a result of a mix shift from non-interest bearing to interest-bearing deposit products, higher short-term interest rates and an increase in the average balances of interest-bearing core deposits.2024. Refer to the Deposits subsection of the Balance Sheet Analysis section of MD&A for additional information on the Bancorp’s deposits.
Interest expense on average wholesale funding increaseddecreased $11$209 million for the year ended December 31, 20242025 compared to the year ended December 31, 20232024 primarily due to increasesa decrease in the rates paid on average wholesale funding and decreases in the average balances of long-term debt and yieldsCDs onover long-term debt,$250,000, partially offset by aan decreaseincrease in the average balances of FHLB advances. Refer to the Borrowings subsection of the Balance Sheet Analysis section of MD&A for additional information on the Bancorp’s borrowings. During the year ended December 31, 2024,2025, average wholesale funding represented 16%15% of average interest-bearing liabilities compared to 18%16% for the year ended December 31, 2023.2024. For more information on the Bancorp’s interest rate risk management, including estimated earnings sensitivity to changes in market interest rates, refer to the Interest Rate and Price Risk Management subsection of the Risk Management section of MD&A.
57 Fifth Third Bancorp
(a)The FTE adjustments included in the above table were $24, $25 and $16 for the years ended December 31, 2024, 2023 and 2022, respectively.
(b)Net interest income (FTE), net interest margin (FTE) and net interest rate spread (FTE) are non-GAAP measures. For further information, refer to the Non-GAAP Financial Measures section of MD&A.
(a)The FTE adjustments included in the above table were $20, $24 and $25 for the years ended December 31, 2025, 2024 and 2023, respectively.
(b)This is a non-GAAP measure. For further information, refer to the Non-GAAP Financial Measures section of MD&A.
59 Fifth Third Bancorp
The Bancorp provides, as an expense, an amount for expected credit losses within the loan and lease portfolio and the portfolio of unfunded commitments that is based on factors discussed in the Critical Accounting Policies section of MD&A. The provision is recorded to bring the ALLL and reserve for unfunded commitments to a level deemed appropriate by the Bancorp to cover losses expected in the portfolios. Actual credit losses on loans and leases are charged against the ALLL. The amount of loans and leases actually removed from the Consolidated Balance Sheets are referred to as charge-offs. Net charge-offs include current period charge-offs less recoveries on previously charged-off loans and leases.
The provision for credit losses was $530$662 million for the year ended December 31, 20242025 compared to $515$530 million in the prior year. Provision expense for the year ended December 31, 20242025 wasincreased affectedprimarily driven by the impactsfraud-related impairment of deteriorationan inasset-backed the macroeconomic forecast for thefinance commercial portfolio,loan higherwhich period-endincluded loana charge-off of $178 million and leasea balancesspecific andallowance of $20 million, as well as increases in specific reserves on individually evaluated commercial loans,loans and higher period-end loan and lease balances. The increase in provision expense for the year ended December 31, 2025 was partially offset by factors that reduced the ACL from December 31, 2024, including the impacts of changes in consumer loan portfolio mix, improvement inboth the macroeconomicmix forecastand forcredit quality of the consumer loan portfolio and improvements in probability of default ratings on collectively-evaluated commercial loans.
The ALLL increased $30 million from December 31, 2023 to $2.4 billion at December 31, 2024. At December 31, 2024, the ALLL as a percent of portfolio loans and leases decreased to 1.96%, compared to 1.98% at December 31, 2023. The reserve for unfunded commitments
59The Fifth Third BancorpALLL decreased $32$99 million from December 31, 20232024 to $134$2.3 billion at December 31, 2025. At December 31, 2025, the ALLL as a percent of portfolio loans and leases decreased to 1.84%, compared to 1.96% at December 31, 2024. The reserve for unfunded commitments increased $23 million from December 31, 2024 to $157 million at December 31, 2024.2025. At December 31, 2024,2025, the ACL as a percent of portfolio loans and leases decreased to 2.08%,1.96%, compared to 2.12%2.08% at December 31, 2023.2024.
60 Fifth Third Bancorp
Noninterest income decreasedincreased $32$186 million for the year ended December 31, 20242025 compared to the year ended December 31, 2023.2024. The following table presents the components of noninterest income:
(a)During 2024, certain noninterest income line items were reclassified to better align disclosures to business activities. These reclassifications were retrospectively applied to all prior periods presented. Total noninterest income did not change as a result of these reclassifications.
Commercial payments revenue increased $44$22 million for the year ended December 31, 20242025 compared to the year ended December 31, 20232024 primarily driven by an increase in treasury management fees due to new client acquisition and higher average revenue per existing customer.customer, which included the benefit of cross sales to existing customers, and new client acquisition.
Consumer banking revenue increased $9$16 million for the year ended December 31, 20242025 compared to the year ended December 31, 20232024 primarily driven by an increase in interchangedeposit incomefees associateddue withto higherincreased transactionoverdraft volumes.occurrences.
What changed in the latest 10-Q
Risk Factors
We could not find a separate Risk Factors item in the latest 10-Q. Some companies leave it out of quarterly reports; see the annual 10-K risk factors and the original filing. Open the filing on SEC.gov.
Management's Discussion & Analysis (MD&A)
Not available: the section could not be located automatically in both filings (non-standard layout or incorporated by reference). See the original filing. Open the filing on SEC.gov.
FITB insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 3 filings (3 insiders, 3 trade dates, 108,045 shares, about $5.8M). Net open-market shares: -108,045 (purchases minus sales); net value about -$5.8M.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-08-04 | Gibson Kala |
Shares withheld for tax | 4,821 | $57.77 | $278.5K |
| 2026-08-04 | Gibson Kala |
Option exercise | 7,018 | $26.52 | $186.1K |
| 2026-07-20 | Leonard James C. |
Option exercise | 9,654 | $26.72 | $258.0K |
| 2026-07-20 | Leonard James C. |
Option exercise | 8,248 | $29.64 | $244.5K |
| 2026-07-20 | Leonard James C. |
Shares withheld for tax | 6,667 | $57.40 | $382.7K |
| 2026-07-20 | Leonard James C. |
Shares withheld for tax | 5,939 | $57.40 | $340.9K |
| 2026-07-20 | Leonard James C. |
Option exercise | 4,965 | $33.17 | $164.7K |
| 2026-07-20 | Leonard James C. |
Shares withheld for tax | 6,041 | $57.40 | $346.8K |
| 2026-07-20 | Leonard James C. |
Option exercise | 8,772 | $26.52 | $232.6K |
| 2026-07-20 | Leonard James C. |
Shares withheld for tax | 3,753 | $57.40 | $215.4K |
| 2026-04-29 | Gibson Kala |
Gift | 4,300 | — | — |
| 2026-04-28 | Sefzik Peter L |
Open-market sale | 18,767 | $50.46 | $947.0K |
| 2026-04-28 | Sefzik Peter L |
Open-market sale | 100 | $50.47 | $5.0K |
| 2026-04-28 | Sefzik Peter L |
Open-market sale | 200 | $50.47 | $10.1K |
| 2026-04-28 | Sefzik Peter L |
Open-market sale | 100 | $50.45 | $5.0K |
| 2026-04-28 | Sefzik Peter L |
Open-market sale | 398 | $50.44 | $20.1K |
| 2026-04-28 | Sefzik Peter L |
Open-market sale | 435 | $50.45 | $21.9K |
| 2026-04-21 | Feiger Mitchell Stuart |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Almodovar Priscilla |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Benitez Jorge L. |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Bayh Evan |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Akins Nicholas K |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Desmangles Laurent |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Smith Barbara |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Kerr Derek J |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Heminger Gary R. |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Rogers Kathleen A |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Van De Ven Michael G |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Blackburn Katherine H. |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Clement-Holmes Linda W |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Daniels C. Bryan |
Grant/award | 2,838 | — | — |
| 2026-04-21 | Mallesch Eileen A |
Grant/award | 2,838 | — | — |
| 2026-04-20 | Khanna Kevin J |
Open-market sale | 2,000 | $50.78 | $101.6K |
| 2026-04-20 | Khanna Kevin J |
Open-market sale | 4,000 | $50.77 | $203.1K |
| 2026-04-17 | Lopper Jeffrey A |
Option exercise | 3,835 | $18.11 | $69.5K |
| 2026-04-17 | Lopper Jeffrey A |
Shares withheld for tax | 2,046 | $50.34 | $103.0K |
| 2026-02-12 | Feiger Mitchell Stuart |
Open-market sale | 49,175 | $54.68 | $2.7M |
| 2026-02-12 | Feiger Mitchell Stuart |
Open-market sale | 32,769 | $54.68 | $1.8M |
| 2026-02-12 | Feiger Mitchell Stuart |
Open-market sale | 101 | $54.68 | $5.5K |
Well-known investors holding FITB (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Davis Selected Advisers (Chris Davis) | 2026-06-30 | 2,684,183 | $151.3M | 0.65% | Reduced 5% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 390,883 | $22.0M | 0.01% | Added 8% |
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 390,932 | $22.0M | 0.01% | Reduced 27% |
| Millennium Management (Israel Englander) | 2026-06-30 | 463,437 | $21.5M | — | Sold out |
| PRIMECAP Management | 2026-06-30 | 196,260 | $9.1M | — | Sold out |
| Gotham Asset Management (Joel Greenblatt) | 2026-06-30 | 144,697 | $8.2M | 0.02% | Added 6% |
| Two Sigma Investments | 2026-06-30 | 133,381 | $7.5M | 0.01% | Reduced 76% |
| D. E. Shaw & Co. | 2026-06-30 | 5,000 | $281.9K | 0.0% | New position |