Truist Bets on Digital Engagement to Deepen Banking Ties

Truist’s active mobile users rose 4% to 5.4 million, while digital transaction volume climbed 7%. Consumer spending and liquidity held steady, and credit losses declined from the first quarter. Middle-market deposits rose 12%, led by gains in Truist’s newer regional markets. Truist’s second quarter displayed a range of puts and takes shaping consumer banking. Consumer behavior remained resilient during the quarter, with stable liquidity, spending and credit trends that remain within our expectations. Credit quality also improved from the first quarter. Net charge-offs fell 11 basis points to 50 basis points, with lower losses across most portfolios. Nonperforming loans rose by one basis point, partly because Truist changed its nonaccrual rules for loans in its nonprime auto business. Management said the accounting change did not reflect weaker underlying credit trends. The results came as Truist narrowed its lending focus. The bank is reducing exposure to marine, recreational vehicle and selected auto loans. It is directing more capital toward commercial borrowers, where an initial loan can lead to deposits, payments, liquidity services and capital markets work. Chief Financial Officer Mike Maguire said the review also extends to wholesale banking. “There are things that we’ve done and will continue to do in wholesale around client selection, around pricing, around product design, rebalancing, that are all intended to create more profitability and efficiency,” Maguire told analysts. Digital Use Carries More Financial Weight Digital engagement was one of the clearest measures of customer behavior in the quarter. Active mobile users rose 4% from a year earlier to 5.4 million, while digital transaction volume increased 7% to 93 million transactions. About 85% of client logins now take place through mobile devices. Rogers linked digital activity directly to revenue, profit and operating costs. “Digital active clients generate more revenue and higher profitability than non-digital clients, while greater self-service adoption continues to improve efficiency across the franchise,” Rogers said. Clients used Truist Assist nearly 2 million times during the quarter, up 60% from a year earlier. The virtual assistant gives customers a way to handle routine service matters without visiting a branch or contacting an employee. Rogers said the usage reflected “growing adoption of self-service capabilities and our continued investment in the digital client experience.”