TFCTruist Financial
Truist Financial Corporation is a purpose-driven financial services company committed to inspiring and building better lives and communities. 10-K, Item 1
- Headquarters
- Charlotte, NC
- CEO
- Michael P. Lyons
- Next results
- around Jan 20, 2027
24 paragraphs in Risk Factors of the 10-K filed Feb 24, 2026 with nothing like them in the 10-K filed Feb 25, 2025. Quoted exactly. Paragraphs that were only edited are under 10-K change.
Compared with the Risk Factors in the latest 10-K of the other 75 Financials companies: a paragraph with at least half its words the same at another company is called similar, and the companies are listed under it. A paragraph most of them have is marked boilerplate. No line means no other company has one like it. This counts text; it does not say how serious a risk is.
•The use of AI in our products and services, as well as our business and the industry more broadly, may negatively impact our business, operations, financial condition, results of operations, prospects, and reputation.
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•The Company’s risk and control framework may fail to identify, assess, monitor, and mitigate the risks we face and cause us to suffer unexpected losses that could adversely affect our business, financial condition, results of operations, prospects, and reputation.
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•Truist faces loan servicing risks that could adversely impact the Company’s business, operations, liquidity, and results of operations.
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•Truist faces risks of non-compliance and may incur additional operational and compliance costs under laws relating to anti-money laundering, economic sanctions, embargo programs, anti-bribery, and anti-corruption.
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•The Company is at risk of losses from fraud which could result in financial loss and reputational harm.
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The Company has experienced, and may continue to experience, failures and disruptions affecting the stability, performance, security, and availability of its applications, operating systems, and infrastructure. These include degraded processing performance, data quality issues, loss of network connectivity, software malfunctions and misconfigurations, and interruptions in the availability and reliability of cloud-based and other third-party systems and services. The Company’s substantial and increasing reliance on cloud service providers and other external technology vendors heightens exposure to risks outside of its control, including system outages, downtime, cyber-attacks, and adverse financial and operating conditions at those providers and vendors. The Company’s expanding use of AI tools and related technologies introduces additional operational risks, including reliance on data integrity and model performance as well as third-party AI services that may fail, degrade, or produce inaccurate or unexpected outputs.
The Company regularly updates and modifies its applications, operating systems, and infrastructure to support business and operations, including growth initiatives and regulatory compliance requirements. These activities involve significant costs and create additional risks related to the implementation, integration, and effectiveness of new or modified applications, systems, and infrastructure. The introduction, updating, or retraining of AI models and other methods of automation may amplify these risks. Changes in model behavior or configuration may produce unintended outcomes, increase susceptibility to operational errors, or reduce the effectiveness of existing controls. Failures associated with upgrades, configuration changes, system conversions, AI model deployment, integration efforts, and related activities may result in operational interruptions, system failures, or reduced control effectiveness.
Failures to properly maintain, upgrade, or secure applications, operating systems, and infrastructure may increase the Company’s susceptibility to cybersecurity threats, including supply chain attacks, and may impair the Company’s ability to meet business continuity and resiliency objectives. AI-enabled technologies may further expand the cyber-attack surface and velocity, including exposure to adversarial manipulation, data poisoning, and vulnerabilities in third-party AI and other platforms. These events have resulted in adverse client impacts, including the inability to access account information or conduct transactions through ATM, online, or mobile channels, the exposure of confidential, proprietary, personal, and other sensitive information, the posting of duplicative or delayed transactions, and delays in obtaining assistance through call centers. The Company cannot assure that similar or more severe operational or technology failures and disruptions, including AI-related failures or third-party service interruptions, will not occur in the future or that their effects can be prevented, contained, or remediated in a timely manner.
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The use of AI in our products and services, as well as our business and the industry more broadly, may negatively impact our business, operations, financial condition, results of operations, prospects, and reputation.
Our industry is subject to rapid and significant technological change. To compete effectively, the Company uses new and evolving technologies, including AI, to help improve our marketing, referrals, products, services, and client service, to increase productivity for internal code and software development and testing, and to automate certain business decisions and risk management practices, such as fraud identification. The Company's use of AI is subject to risks that models, prompts, algorithms, and datasets, as well as related decisions, predictions, analysis, and other output, are flawed, inaccurate, of poor quality, insufficient, biased, or otherwise erroneous or inadequate, any of which may not be easily detectable. In addition, the models and processes relating to AI are not always transparent, which could increase the risk of unintended deficiencies. Ineffective implementation of AI by us or our third-party providers could subject us to additional risks that we cannot adequately predict or mitigate. Further, inappropriate or controversial data practices by developers and end-users, or other factors adversely affecting public opinion of AI and machine learning, could impair the acceptance and use of AI. If any of these risks are realized, we could suffer business and operational disruptions, operational inefficiencies, competitive harm, legal liability, increased regulatory scrutiny, reputational harm, or other consequences that the Company cannot predict, any of which could negatively affect the Company's financial condition and results of operations.
Regulatory and other legal frameworks surrounding AI continue to evolve and remain uncertain. If we do not have sufficient rights to use models, prompts, algorithms, and datasets on which our AI technologies rely or the related decisions, predictions, analysis, or other output, we could incur significant damages, substantial fees, deprivation of access, or considerable expense through a violation of applicable law, third-party intellectual property, privacy, or other rights, or other violations. New or changing statutes, regulations, or industry standards and practices may increase costs, restrict use cases, or require significant changes to our deployment or our existing systems and controls. If we fail to appropriately respond to changes within the AI landscape, including changing public sentiment, we could face legal, regulatory, or brand and stakeholder risk that may negatively impact our business, operations, financial results, financial condition, or reputation. In addition, the use of AI by companies has resulted in, and may in the future result in, cybersecurity breaches, attacks, and other similar incidents as well as data privacy violations.
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The Company’s risk and control framework may fail to identify, assess, monitor, and mitigate the risks we face and cause us to suffer unexpected losses that could adversely affect our business, financial condition, results of operations, prospects, and reputation.
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8 more
Truist faces loan servicing risks that could adversely impact the Company’s business, operations, liquidity, and results of operations.
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U.S. BHCs, including Truist, are subject to a range of prudential standards and requirements based on their size and complexity. Truist is subject to more stringent liquidity and capital requirements, leverage limits, internal and supervisory stress testing requirements, single-counterparty credit limits, resolution planning requirements, and enhanced risk management standards compared to smaller institutions, while certain larger or more complex banking organizations are subject to even more stringent prudential standards and requirements than Truist. These differing standards and requirements can put Truist at a competitive disadvantage compared to other banking organizations.
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Truist and Truist Bank are subject to risk-based and leverage regulatory capital requirements, which are established by the FRB for Truist and by the FDIC for Truist Bank. Failure of an FHC or an IDI to be well-capitalized as defined by applicable law or to meet minimum capital requirements can result in enforcement and other supervisory actions and have a significantly adverse impact on the institution’s business and operations. Certain BHCs and their bank subsidiaries, including Truist and Truist Bank, are subject to a minimum LCR and NSFR.
The U.S. risk-based regulatory capital rules are based on the Basel Framework developed by the BCBS for strengthening the regulation, supervision, and risk management of banks as well as certain provisions of the Dodd-Frank Act. These rules prescribe minimum capital levels and allow the FRB and the FDIC to impose incremental capital requirements on a banking organization based on its size, complexity, or risk profile to enhance its ability to operate in a safe and sound manner. In several instances, the U.S. banking agencies have applied stricter capital and liquidity standards to U.S. banking organizations.
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Because prudential standards and requirements are typically based on the size and complexity of the firm, large institutions, such as the Company, often are subject to more stringent regulatory requirements and supervision than smaller and less complex institutions. Changes in capital requirements, including any easing of capital requirements for our larger bank competitors, may result in increased competition and challenge our ability to execute on our growth strategies and branch expansion.
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Actions or initiatives by federal and state governmental authorities, including the U.S. banking agencies, may also provide competitors with increased opportunities to derive competitive advantages and may create new competitors. These actions or initiatives may include more accommodative positions on the processing and approval of traditional bank charters and deposit insurance, expanded access to the banking and payments systems through the approval of competitors, including competitors with novel business models, to hold specialized charters, or more accommodative positions on novel activities performed by banks or nonbanks.
Truist faces risks of non-compliance and may incur additional operational and compliance costs under laws relating to anti-money laundering, economic sanctions, embargo programs, anti-bribery, and anti-corruption.
Truist must comply with statutes and regulations relating to anti-money laundering, economic sanctions, embargo programs, anti-bribery, and anti-corruption, which increases the risk of non-compliance with applicable law and costs associated with the implementation and maintenance of complex compliance programs. The rapid evolution of technology, including the growth of digital assets, stablecoins, cryptocurrencies, tokenization, and blockchain and other distributed ledger technologies, introduce additional challenges to traditional client due diligence, transaction monitoring, and suspicious activity reporting required by applicable law. The BSA, as amended by the Patriot Act, and its implementing regulations require financial institutions, including IDIs such as Truist Bank, broker-dealers, and other financial institutions, to develop and implement BSA/AML compliance programs that detect and report financial crimes. The BSA and its implementing regulations also strengthen the ability of U.S. law enforcement agencies and the intelligence community to disrupt and prevent money laundering, the financing of terrorism, and related crimes. In addition, U.S. persons, including entities like Truist, must comply with sanctions programs administered by OFAC and the U.S. Department of State. These sanctions programs prohibit, among other things, financial transactions involving certain individuals, entities, countries, and territories that are the subject of U.S. economic sanctions and impose other restrictions on certain investments and dealings, including requirements to block assets.
Federal law grants substantial enforcement powers to U.S. banking agencies, FinCEN, OFAC, the U.S. DOJ, and other government agencies with respect to BSA and OFAC compliance, including through examination and ongoing monitoring. This enforcement authority includes the ability to assess significant civil and criminal monetary penalties, fines, and restitution; to issue cease and desist or prohibition orders; to initiate injunctive actions against financial institutions and institution-affiliated parties; and to impose restrictions on business, including bank and BHC mergers and acquisitions. These enforcement actions may be initiated for violations of statutes and regulations or for unsafe and unsound practices and could result in substantial negative shareholder reaction, reputational damage, and adverse effects on our financial condition and results. Given the rapid development and cross-border nature of these criminal activities that are enabled by evolving technologies, any failure to adapt and modernize our BSA/AML compliance program, processes, and procedures may result in material compliance gaps, adverse enforcement actions, and civil and legal penalties.
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Negative public opinion could also result from heightened and differing stakeholder expectations regarding environmental and social considerations that may affect Truist and clients of Truist. Standards and expectations relating to environmental and social matters are evolving and often inconsistent across regulators, investors, clients, and other stakeholders. Actions taken by the Company in these areas may be viewed favorably by some groups and criticized by others, creating tradeoffs that increase compliance, legal, and regulatory risk or cause reputational harm.
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In addition, advances in technology, such as automation and AI, may lead us to modify our workforce strategy. This could require Truist to invest in additional teammate training, manage impacts on morale and retention, and compete for candidates who possess more advanced technological skills, all of which could have a negative impact on Truist’s business and operations.
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The Company is at risk of losses from fraud which could result in financial loss and reputational harm.
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New in the latest 10-Q
32 paragraphs in the 10-Q filed Oct 28, 2026 with nothing like them in the 10-Q filed Jul 31, 2026 (at least half the words must differ; new numbers alone do not count). Quoted exactly, grouped by the item heading above them. This is text that changed, not a judgement of how serious it is.
10-Q
• our ability to implement strategic and operational plans, including with respect to allocating capital and resources to our highest-value opportunities, becoming the most important financial partner to our clients, and executing with urgency, discipline, and accountability;
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Financial statements and notes
On October 14, 2026, Truist signed an agreement to sell $ 7.7 billion of loans, representing substantially all assets of LightStream, a national unsecured lending platform. Estimated net proceeds for the transaction are $ 7.2 billion. The resulting impact to net income is not expected to be material. The transaction is expected to close in the fourth quarter of 2026, subject to customary closing conditions.
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The following table presents gross securities gains and losses recognized in earnings:
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In the third quarter of 2026, Truist executed a strategic balance sheet repositioning of a portion of its AFS securities portfolio by selling $ 8.6 billion of longer-duration, lower-yielding agency MBS and purchasing $ 7.2 billion of shorter-duration, higher-yielding agency MBS and U.S. Treasury securities.
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In the third quarter of 2026, Truist sold $ 5.5 billion of RAC loans from the indirect auto portfolio for proceeds of $ 5.2 billion. The RAC loan sale resulted in a $ 581 million pre-tax loan loss reserve recapture following the recognition of held for sale-related charge-offs.
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Primary income statement location of realized gains (losses) included in earnings Other income Mortgage banking income Mortgage banking income and other income
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The following table presents information about the valuation techniques and significant unobservable inputs used to measure the fair value of certain equity derivatives measured at fair value on a recurring basis. Such equity derivatives primarily consist of long-dated options that are not traded on an exchange and may also include exchange-traded options with limited transaction volumes for which certain significant valuation inputs are unobservable. These options are valued using an option pricing model, which is generally used for instruments that provide the holder with a contingent right or obligation based on the future performance of an underlying equity instrument. The significant unobservable input utilized in the valuation is volatility, which represents a market participant’s expectation of the variability in the value of the underlying equity instrument over the contractual term of the derivatives.
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Generally, increases in volatility result in a higher fair value for instruments in which Truist is long the underlying exposure, while decreases in volatility result in a lower fair value. The inverse relationship generally applies to instruments in which Truist is short the underlying exposure. Weighted average volatility is calculated based on the notional amounts of the derivative instruments.
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On August 31, 2026, Mike Lyons became Truist’s President and Chief Executive Officer. We are reallocating resources to focus on our core business and invest in core capabilities (including technology, talent, and products). These efforts are centered on helping us become the most important financial partner to our clients and driving stronger, more sustainable growth and higher returns.
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For the third quarter of 2026, we reported net income of $684 million, or $0.56 per diluted share, which reflects the impact of several actions to better position Truist for the future. The actions described below simplify the Company, allow us to focus more on our core businesses, and further strengthen our balance sheet by reducing credit risk, interest rate risk, and wholesale funding.
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The actions taken during the third quarter included the completion of the Regional Acceptance Corporation (RAC) loan sale and the subsequent repositioning of a portion of our AFS securities portfolio. The RAC loan sale resulted in a $581 million pre-tax, or $0.36 per share, loan loss reserve recapture and $106 million pre-tax, or $0.06 per share, of impacts included in noninterest income and noninterest expense. The AFS securities repositioning resulted in a $1.4 billion pre-tax, or $0.90 per share, loss.
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Underlying results were solid, reflecting client-driven deposit growth, strong asset quality, continued expense discipline, and continued capital return to shareholders.
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Additionally, on October 14, 2026, Truist signed an agreement to sell $7.7 billion of loans, representing substantially all assets of LightStream, a national unsecured lending platform. Estimated net proceeds for the transaction are $7.2 billion. The resulting impact to net income is not expected to be material. The transaction is expected to close in the fourth quarter of 2026, subject to customary closing conditions.
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• Noninterest income was impacted by $66 million of losses resulting from the RAC loan sale and $1.4 billion of losses from the AFS securities sale, partially offset by record quarterly income for wealth management.
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• The third quarter of 2026 included a benefit from credit losses of $253 million, reflecting the benefit from the release of remaining ACL upon the transfer of RAC loans to LHFS.
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Noninterest income decreased $1.5 billion for the third quarter of 2026 compared to the third quarter of 2025, and $1.1 billion for the nine months ended September 30, 2026 compared to 2025. The third quarter of 2026 included losses from AFS securities sales of $1.4 billion and losses associated with the RAC loan sale of $66 million (other income).
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• Other income decreased primarily due to the losses associated with the RAC loan sale and lower returns from investments held for post-retirement benefits (which were offset by lower personnel expense).
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• Other income decreased primarily due to the losses associated with the RAC loan sale and lower income from certain solar and other investments.
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• Other expense decreased primarily driven by adjustments to non-fraud operating loss accruals.
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The lower effective tax rate for the third quarter of 2026 compared to the third quarter of 2025 was primarily driven by lower income before tax resulting from the AFS securities repositioning, which increased the relative benefit of tax credits, renewable energy tax credit investing activity, and other tax-advantaged items on the effective tax rate. The provision for income taxes was also impacted by the RAC loan sale and AFS securities repositioning.
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• Noninterest income decreased $1.5 billion driven by a loss from the sale of securities resulting from the AFS securities repositioning.
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• Noninterest income decreased $1.5 billion primarily driven by a loss from the sale of securities resulting from the AFS securities repositioning.
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During the third quarter of 2026, we repositioned a portion of our AFS securities portfolio by selling $8.6 billion of longer-duration, lower-yielding agency MBS and purchasing $7.2 billion of shorter-duration, higher-yielding agency MBS and U.S. Treasury securities. The sale of securities resulted in a $1.4 billion loss.
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(1) Includes a net benefit of $581 million in the third quarter of 2026 from the loan loss reserve recapture following the recognition of held for sale-related charge-offs resulting from the RAC loan sale.
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• Maturities and redemptions of $4.3 billion of senior notes and $1.8 billion of subordinated notes.
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On September 30, 2026, the FRB published two final rules on stress testing and related capital requirements. The first final rule enhances transparency and public accountability of the stress testing process by improving disclosures of, and providing opportunity for public comment and input on, the supervisory models and scenarios used in the FRB’s stress tests. The rule also makes several adjustments to the annual stress test calendar and adopts as final most of the models that will be used for the 2027 stress test, subject to a proposed change to the FRB’s noninterest income model. The second final rule sets a new SCB effective date of January 1 of the year following a stress test and modifies the calculation of the SCB to reflect the average of the stress test results from the two most recent stress tests. Truist will receive a new SCB effective on January 1, 2028 based on the results of its 2027 stress test. Beginning with the 2028 stress test, Truist’s SCB will be calculated based on the average projected decline of CET1 ratios across the two most recent FRB stress tests, with effect from January 1, 2029.
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Item 6
10.1 First Amendment to the Truist Financial Corporation Non-Qualified Defined Contribution Plan (January 1, 2025 Restatement) Filed herewith.
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10.2 Form of Participation Agreement under the Truist Financial Corporation Executive Severance Plan for Michael P. Lyons Filed herewith.
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10.3 Form of Restricted Stock Unit Agreement (Senior Executive) for the Truist Financial Corporation 2022 Incentive Plan (amended and restated as of April 28, 2026) Filed herewith.
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10.4 Form of Performance Unit Award Agreement (Senior Executive) for the Truist Financial Corporation 2022 Incentive Plan (amended and restated as of April 28, 2026) Filed herewith.
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10.5 Form of LTIP Award Agreement (Senior Executive) for the Truist Financial Corporation 2022 Incentive Plan (amended and restated as of April 28, 2026) Filed herewith.
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10.6 Form of Restricted Stock Unit Agreement (Non-Employee Directors) for the Truist Financial Corporation 2022 Incentive Plan (amended and restated as of April 28, 2026) Filed herewith.
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The 10-Q's risk factors against the 10-K
Item 1A of the 10-Q filed Oct 28, 2026 against Item 1A of the 10-K filed Feb 24, 2026.
A 10-Q repeats only the risks that changed, so a 10-K paragraph that is missing from it is not counted as removed.
Added is a paragraph with nothing like it in the 10-K, Reworded a sentence that is in both with several words changed,
Quiet changes a sentence in both where one to four words changed and one is a hedge or a modal
(cut words struck through, new words highlighted and underlined).
Text on the page, not a score; each links to the filing at sec.gov.
What the 10-Q itself says about its risk factors:
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There have been no material changes to the risk factors disclosed in Truist’s Annual Report on Form 10-K for the year ended December 31, 2025. Additional risks and uncertainties not currently known to Truist or that management has deemed to be immaterial also may materially adversely affect Truist’s business, financial condition, or operating results.
1 paragraph in the 10-Q's Item 1A, and none of them adds, rewords or quietly edits a paragraph of the 10-K's.
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