Fifth Third Earnings Beat Estimates as Lower Deposit Costs Boost Interest Income

Fifth Third Bancorp (NASDAQ: FITB) reported third-quarter earnings that beat expectations, supported by higher net interest income as deposit costs declined, although the bank noted a loss linked to a loan made to bankrupt auto dealer Tricolor.

The Ohio-based lender, like many regional peers, has been working to reduce deposit costs amid the Federal Reserve’s ongoing interest rate cutting cycle.

Net interest income — the difference between interest earned on loans and interest paid on deposits — rose 7% year-over-year to $1.53 billion, slightly above the $1.52 billion forecast from Bloomberg consensus estimates.

Adjusted noninterest income totaled $789 million, also exceeding expectations, as higher fees bolstered the bank’s wealth and asset management divisions.

Net income available to common shareholders increased 14% to $608 million, or $0.91 per diluted share, topping the analyst estimate of $0.87.

Executives said Fifth Third’s balance sheet remained well-positioned for a lower-rate environment, and its fee-based businesses continued to perform strongly despite market volatility.