Fifth Third Bancorp Stock Slips on Worse-Than-Expected Profit

Key Takeaways

• Fifth Third Bancorp reported worse-than-expected third-quarter profit Friday as net interest income and noninterest income declined.
• The bank also increased the money is set aside to cover losses from bad loans.
• CEO Tim Spence argued Fifth Third is "well positioned" for a declining interest rate environment.

Fifth Third Bancorp (FITB) shares fell Friday as the Ohio-based bank posted a third-quarter profit drop as net interest income (NII) and noninterest income declined, and it put aside more money to cover bad loans. 

Fifth Third reported quarterly net income of $573 million, down from $660 million a year ago. Earnings per share (EPS) of $0.78 missed the consensus estimate of $0.83 of analysts polled by Visible Alpha.

Net interest income declined 1.2% year-over-year to $1.42 billion, and noninterest income was 0.6% lower at $711 million.

Fifth Third put aside $160 million for credit losses, a 34% jump from 2023, and 65% more than in the second quarter.

CEO Says 'Well Positioned for the Declining Interest Rate Environment'

Chief Executive Officer (CEO) Tim Spence said the bank put in a "strong and consistent performance" in the period, and is "well positioned for the declining interest rate environment and volatility driven by the economic and regulatory uncertainty."

Fifth Third Bancorp shares closed at a more than two-year high yesterday, and even with today's roughly 2% decline they're up nearly 30% in 2024.

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