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Paring back branch networks is a quick way to cut costs. But executives at large regionals are reluctant to make such cuts until they have found a way to thrive at other delivery channels.
July 8 -
Fifth Third Bancorp in Cincinnati will close or sell about 100 branches=, or about 7% of its total branch network.
June 22 -
Fifth Third Bancorp and Regions Financial are the latest banks to detail the financial fallout from a regulatory crackdown on the small-dollar consumer loan product.
January 22 -
Greg Carmichael, a former IT executive, has been tapped to lead Fifth Third Bancorp, a move showing the growing importance of technology in banks' operations. He'll have to find new ways to grow revenue as he succeeds Kevin Kabat, under whom profitability has sagged recently.
July 8
Fifth Third Bancorp in Cincinnati reported a decline in second-quarter profit, as the costs to close branches offset loan growth.
The $142 billion-asset company said net income fell 30% to $292 million, or 36 cents per share, from a year earlier. Despite the decline, Fifth Third is headed in the right direction because loan growth accelerated from the first quarter, Scott Siefers, an analyst at Sandler O'Neill, wrote in a research note.
Net interest income fell 1% to $892 million, as the yield on interest-earning assets fell 25 basis points to 3.28%. The net interest margin fell 25 basis points to 2.9%. Fifth Third said that its
Average loans and loans and leases rose 2% to $92.7 billion. Commercial and industrial loans, Fifth Third's largest loan category, rose 4% to $42.8 billion, from a year earlier.
"Right now, commercial and industrial will dominate our loan growth," Tayfun Tuzun, Fifth Third's chief financial officer, said during a conference call.
Fee income fell 24% to $556 million, as Fifth Third booked a $97 million pretax charge to cover the costs of closing 105 branches.
Fifth Third last month said it would
The company also recorded a $17 million pretax positive valuation adjustment on its warrant in payments company Vantiv.
Noninterest expense fell 1% to $947 million on lower charges for litigation reserves.