Truist Financial : Regulatory Disclosure (TFC 1Q26 Pillar 3 Disclosures)
TFC
Published on 05/11/2026 at 04:57 pm EDT
Truist Financial Corporation March 31, 2026
Table of Contents
Page No.
Glossary of Defined Terms
1
Introduction
3
Capital Structure
3
Capital Adequacy Process
7
Credit Risk
10
Credit Risk Mitigation
17
Securitizations
18
Equity Securities Not Subject to Market Risk Rule
21
Appendix:
Cross Reference Table
22
Forward-Looking Statements and Other Terms
29
Term
Definition
ACL
Allowance for credit losses
AFS
Available-for-sale
Agency MBS
Mortgage-backed securities issued by a U.S. government agency or GSE
ALLL
Allowance for loan and lease losses
AOCI
Accumulated other comprehensive income (loss)
BOLI
Bank-owned life insurance
Basel III Rules
Rules issued by the FRB, OCC, and FDIC on capital adequacy and liquidity requirements in the U.S for banking organizations.
BCBS
Basel Committee on Banking Supervision
BHC
Bank holding company
Boards of Directors
Joint Boards of Directors of Truist Financial Corporation and Truist Bank
CAP
Capital Adequacy Process
CCAR
Comprehensive Capital Analysis and Review
CCB
Capital Conservation Buffer
CCP
Central clearing party
CD
Certificate of deposit
CDS
Credit default swaps
CET1
Common equity tier 1
Company
Truist Financial Corporation and subsidiaries (interchangeable with "Truist" below)
CRE
Commercial real estate
CSA
Credit support annex
CSBB
Consumer and Small Business Banking, an operating segment
CVA
Credit valuation adjustment
Dodd-Frank Act
Dodd-Frank Wall Street Reform and Consumer Protection Act
DVA
Debit valuation adjustment
ERC
Enterprise Risk Committee
FDIC
Federal Deposit Insurance Corporation
FFIEC
Federal Financial Institutions Examination Council
FHC
Financial Holding Company
FINRA
Financial Industry Regulatory Authority
FRB
Board of Governors of the Federal Reserve System
GAAP
Accounting principles generally accepted in the United States of America
GSE
U.S. government-sponsored enterprise
HQLA
High-quality liquid assets
HTM
Held-to-maturity
HVCRE
High volatility commercial real estate
IDI
Insured depository institution
ISDA
International Swaps and Derivatives Association, Inc.
LCR
Liquidity Coverage Ratio
LHFI
Loans and leases held for investment
LHFS
Loans held for sale
MBS
Mortgage-backed securities
MD&A
Management's Discussion and Analysis
MDB
Multilateral development bank
NCCOB
North Carolina Office of the Commissioner of Banks
NPA
Nonperforming asset
NSFR
Net stable funding ratio
OCC
Office of the Comptroller of the Currency
OTC
Over-the-counter
Parent Company
Truist Financial Corporation, the parent company of Truist Bank and other subsidiaries
PSE
Public sector entity
PFE
Potential future exposure
RMO
Risk management organization
Rule
Basel III Final Rule
RWA
Risk-weighted assets
Term
Definition
SBIC
Small Business Investment Company
SCB
Stress Capital Buffer
SEC
Securities and Exchange Commission
SPE
Special purpose entity
SSFA
Simplified Supervisory Formula Approach
Tailoring Rules
Final rules changing the applicability thresholds for regulatory capital and liquidity requirements, issued by the OCC, FRB, and FDIC, together with the final rules changing the applicability thresholds for enhanced prudential standards issued by the FRB
Truist
Truist Financial Corporation and subsidiaries
Truist Bank
Truist Bank, a North Carolina-chartered bank
U.S.
United States of America
U.S. Treasury
United States Department of the Treasury
WB
Wholesale Banking, an operating segment
Truist Financial Corporation is an FHC and conducts its business operations through its bank subsidiary, Truist Bank, and other non-bank subsidiaries. Truist is a purpose-driven financial services company committed to inspiring and building better lives and communities.
Headquartered in Charlotte, North Carolina, Truist has leading market share in many of the high-growth markets in the U.S. and offers a wide range of products and services through wholesale and consumer businesses, including consumer and small business banking, commercial and corporate banking, investment banking and capital markets, wealth management, payments, and specialized lending businesses.
Truist Bank, the largest subsidiary of Truist Financial Corporation, is a state non-member bank and is supervised by the FDIC and NCCOB, while Truist is supervised by the FRB. Truist's non-bank subsidiaries are regulated and supervised by various other regulatory bodies, including the SEC and the FINRA. Truist Bank was chartered in 1872 and is the oldest bank headquartered in North Carolina. Truist Bank is one of the 10 largest commercial banks in the U.S. and provides banking and trust services for clients through its digital platform and 1,927 branches as of March 31, 2026.
The Basel Framework developed by the BCBS consists of a three "Pillar" approach:
Pillar 1 establishes minimum capital requirements, defines eligible capital instruments, and prescribes rules for calculating RWA.
Pillar 2 requires banks to have an internal capital adequacy assessment process and requires that banking supervisors evaluate each bank's overall risk profile as well as its risk management and internal control processes.
Pillar 3 encourages market discipline through disclosure requirements which allow market participants to assess the risk and capital profiles of banks.
The cross reference table located in the Appendix specifies the location of disclosures required by the Rule.
This report provides information about Truist's capital structure, capital adequacy, risk exposures, RWA, and risk management framework. It should be read in conjunction with Truist's Annual Report on Form 10-K for the year ended December 31, 2025 and Quarterly Report on Form 10-Q for the period ended March 31, 2026 and the Consolidated Financial Statements for Bank Holding Companies - Form FR Y-9C for the period ended March 31, 2026. Truist's SEC filings are located on its website at ir.truist.com/sec-filings and Truist's other regulatory reports are located on its website at ir.truist.com/regulatory-disclosures.
Basis of Consolidation
The basis of consolidation used for regulatory reporting is the same as that used under GAAP. The disclosures contained herein are on a consolidated basis unless otherwise noted. There are no entities that are consolidated with Truist for financial reporting that are deconsolidated for regulatory reporting, or whose capital is deducted. These disclosures have not been audited by the Company's external auditors.
See "Note 1. Basis of Presentation" in Truist's Annual Report on Form 10-K for the year ended December 31, 2025 and Quarterly Report on Form 10-Q for the period ended March 31, 2026, for more information on the basis of consolidation.
Truist and Truist Bank are subject to risk-based and 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.
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 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.
As of March 31, 2026, Truist and Truist Bank were classified as "well-capitalized," with capital levels in excess of the minimum regulatory capital requirements.
Regulatory capital includes the following elements:
CET1 capital primarily includes common shareholders' equity and retained earnings, subject to certain regulatory adjustments and deductions, including with respect to goodwill, intangible assets, certain deferred tax assets, and AOCI.
Tier 1 capital is primarily composed of CET1 capital, perpetual preferred stock, and certain qualifying capital instruments.
Tier 2 capital is primarily composed of qualifying subordinated debt and qualifying ALLL. Tier 2 capital also includes certain trust preferred securities.
Total capital includes Tier 1 capital plus Tier 2 capital.
A reconciliation of total shareholders' equity to CET1 capital, Tier 1 capital, Tier 2 capital, and Total capital is presented in Truist's
March 31, 2026 Form FR Y-9C. Refer to the "Consolidated Balance Sheets" in Truist's March 31, 2026 Form 10-Q for the components of total shareholders' equity.
At March 31, 2026, the amount of surplus capital of insurance subsidiaries included in regulatory capital was not material.
Under the Rule, Truist's and Truist Bank's assets, exposures, and certain off-balance sheet items are subject to risk weights used to determine the institutions' RWA. These RWA are used to calculate the required minimum capital ratios for Truist and Truist Bank. See the "Capital Ratios" section herein for further discussion of the capital ratio components.
The RWA calculation is used in determining the institution's capital requirement. RWA under the standardized approach are generally based on supervisory risk weightings that vary by counterparty type and asset class. The predefined risk weight classifications generally range from 0% for U.S. government securities to 600% for certain equity exposures, with a maximum risk weight classification of 1,250% for certain securitization exposures.
Market Risk Rule
Certain large banking organizations with significant trading assets and liabilities, including Truist, are subject to the Market Risk Rule and must adjust their risk-based capital ratios to reflect the market risk of their trading activities. Refer to the "Market Risk" section in the MD&A of Truist's Annual Report on Form 10-K for the year ended December 31, 2025 and Quarterly Report on Form 10-Q for the period ended March 31, 2026 for additional disclosures related to market risk management.
Components of RWA
The following table presents Truist's RWA by exposure type at March 31, 2026:
(Dollars in millions)
March 31, 2026
Credit risk(1):
Corporate and consumer exposures(2)
$ 343,459
Exposure to residential mortgage loans
38,087
Equity exposures
18,605
Exposure to GSEs
11,558
Exposure to PSEs
7,556
Securitization exposures
5,785
Exposure to OTC derivatives
3,251
Exposure to HVCRE loans
2,437
Exposure to past due loans(3)
2,187
Exposure to statutory multifamily mortgage
915
Exposure to depository institutions, foreign banks and credit unions
850
Exposure to sovereign entities
483
Default Fund Contribution Exposures
174
Cleared transactions
39
Total standardized credit risk
435,386
Total standardized market risk
4,947
Total standardized RWA
$ 440,333
Truist does not have any exposures to supranational entities and MDBs.
Corporate and consumer exposures also include other assets.
Includes loans and leases subject to a 150% risk-weight.
See Truist's March 31, 2026 Form FR Y-9C, Schedule HC-R Part I and Part II, on the FFIEC website for disclosures required by the Rule related to the following:
Total standardized RWA by exposure type, including the related on- and off-balance sheet exposure;
Standardized market RWA as calculated under the Market Risk Rule. Additional details are also available in the FFIEC 102 report on the FFIEC's website; and
CET1, Tier 1 capital, and Total risk-based capital components and related calculations.
Under capital adequacy guidelines and the regulatory framework for prompt corrective action, Truist and Truist Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated pursuant to regulatory directives. Truist's capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Truist and Truist Bank are in compliance with these requirements. Banking regulations also identify five capital categories for IDIs: well-capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized. At March 31, 2026, Truist and Truist Bank were classified as "well-capitalized," and management believes that no events or changes have occurred subsequent to period end that would change this designation.
To avoid certain regulatory restrictions, Truist and Truist Bank are required to maintain minimum ratios, which include the additional SCB requirement applicable to certain risk-based capital ratios as disclosed below. The minimum ratios are as follows: CET1 ratio of 4.5% plus SCB, Tier 1 capital ratio of 6% plus SCB, Total capital to risk-weighted assets ratio of 8% plus SCB, Tier 1 capital to quarterly average tangible assets (leverage ratio) of 4%, and Tier 1 capital to total exposures (supplementary leverage ratio) of 3%.
Capital Conservation Buffer and Stress Capital Buffer
Under the FRB's capital framework for BHCs, Truist is subject to the SCB, an incremental risk-based capital requirement determined from the supervisory stress test results. The SCB is equal to the greater of (i) the difference between Truist's starting and minimum projected CET1 capital ratios under the severely adverse scenario in the supervisory stress test, plus the sum of the dollar amount of its planned common stock dividends for each of the fourth through seventh quarters of the planning horizon as a percentage of risk-weighted assets, or (ii) 2.5% of risk-weighted assets.
The FRB has assigned Truist an SCB of 2.5%, which was effective from October 1, 2025 to September 30, 2026, when a revised SCB ordinarily would be provided to Truist. On February 4, 2026, the FRB notified Truist of a determination to extend until October 1, 2027, the deadlines for providing Truist with notice of its preliminary and final SCB requirements calculated in 2026. The FRB explained that its proposal from October 2025, seeking public comment on the models that the FRB planned to use for the 2026 supervisory stress test was still outstanding and was not expected to be finalized before conducting the 2026 supervisory stress test. As a result, absent further action from the FRB, Truist will continue to be subject to its current SCB requirement of 2.5% until 2027, when a new SCB based on updated models can be calculated. If Truist takes part in the supervisory stress test in 2027 as expected, Truist would receive a new final SCB requirement based on the results of a supervisory stress test conducted in 2027. If Truist continues to be subject to the capital plan rule but does not take part in the supervisory stress test in 2027, a final SCB requirement would be assigned that has been adjusted to account for Truist's updated planned common stock dividends. The FRB reserved the authority to modify these deadlines based on a change in actual or expected economic conditions, a change in the financial condition of Truist or its risk profile, or other factors that could affect the safety and soundness of Truist.
Truist is required to describe its planned capital actions in its CCAR capital plan, but is not required to seek prior approval for capital distributions in excess of those included in its CCAR capital plan. Instead, Truist is subject to automatic restrictions on capital distributions if its capital ratios fall below applicable minimum requirements, inclusive of the SCB.
At the FRB's discretion, certain large banking organizations, including Truist, may be subject to a countercyclical capital buffer of up to an additional 2.5% of risk-weighted assets. This buffer is currently set at zero. An FRB policy statement establishes the framework and factors the FRB would use in setting and adjusting the countercyclical capital buffer. Covered banking organizations would generally have 12 months after the announcement of any increase in the countercyclical capital buffer to meet the increased buffer requirement, unless the FRB establishes an earlier effective date. Based on Truist's current SCB, if the maximum countercyclical capital buffer amount is implemented, Truist would be required to maintain a CET1 capital ratio of at least 9.5%, a Tier 1 capital ratio of at least 11.0%, and a total capital ratio of at least 13.0% to avoid limitations on capital distributions and certain discretionary incentive compensation payments. In addition, Truist Bank would be required to maintain a CET1 capital ratio of at least 9.5%, a Tier 1 capital ratio of at least 11.0%, and a Total capital ratio of at least 13.0%. See additional discussion related to the SCB and CCB in Truist's Annual Report on Form 10-K for the year ended December 31, 2025 and Quarterly Report on Form 10-Q for the period ended March 31, 2026.
Truist and Truist Bank are subject to a Tier 1 leverage ratio, equal to the ratio of Tier 1 capital to quarterly average assets, net of goodwill, certain other intangible assets, and certain other deductions. Category III banking organizations are also subject to a minimum 3.0% supplementary leverage ratio. The supplementary leverage ratio is calculated by dividing Tier 1 capital by total leverage exposure, which takes into account on-balance sheet assets as well as certain off-balance sheet items, including loan commitments and potential future exposure of derivative contracts.
The total minimum regulatory capital ratios and well-capitalized minimum ratios applicable to Category III banking organizations at March 31, 2026, are reflected in the table below. The FRB may require a BHC, including Truist, to maintain capital ratios in excess of
mandated minimum levels, depending upon general economic conditions and a BHC's particular condition, risk profile, and growth plans.
The following table presents regulatory capital and risk-based capital ratios for Truist and Truist Bank at March 31, 2026:
(Dollars in millions)
Minimum
Capital
Well-
Capitalized
Minimum Capital
Plus SCB / CCB(1)
Ratio
Amount
Truist:
CET1
4.5 %
NA
7.0 %
10.8 %
$ 47,683
Tier 1 capital
6.0
6.0 %
8.5
11.9
52,596
Total capital
8.0
10.0
10.5
13.7
60,470
Leverage ratio
4.0
NA
NA
9.9
52,596
Supplementary leverage ratio
3.0
NA
NA
8.3
52,596
Truist Bank:
CET1
4.5 %
6.5 %
7.0 %
11.9 %
$ 51,722
Tier 1 capital
6.0
8.0
8.5
11.9
51,722
Total capital
8.0
10.0
10.5
13.4
58,209
Leverage ratio
4.0
5.0
NA
9.9
51,722
Supplementary leverage ratio
3.0
NA
NA
8.2
51,722
(1) Reflects an SCB requirement of 2.5% applicable to Truist as of March 31, 2026. Truist's SCB requirement, received in the 2025 CCAR process, is effective from October 1, 2025 to September 30, 2027.
For additional information, refer to "Item 1. Business" section and the "Capital" section of MD&A in Truist's Annual Report on Form 10-K for the year ended December 31, 2025 and the "Capital" MD&A section in Truist's Quarterly Report on Form 10-Q for the period ended
March 31, 2026.
Revisions to Definition of Eligible Retained Income
The U.S. banking agencies have adopted a final rule altering the definition of eligible retained income. Under the final rule, eligible retained income is the greater of a firm's (i) net income for the four preceding calendar quarters, net of any distributions and associated tax effects not already reflected in net income, and (ii) average net income over the preceding four quarters. This definition applies with respect to all of Truist's capital requirements.
The maintenance of appropriate levels of capital is a management priority and is monitored on a regular basis. Truist's principal goals related to the maintenance of capital are to provide adequate capital to support Truist's risk profile consistent with the Board-approved risk appetite, provide financial flexibility to support future growth and client needs, comply with relevant laws, regulations, and supervisory guidance, achieve optimal credit ratings for Truist, for the Parent Company to remain a source of strength for the Parent Company's subsidiaries, and provide a competitive return to shareholders. Risk-based capital ratios, which include CET1 capital, Tier 1 capital, and Total capital are calculated based on regulatory guidance related to the measurement of capital and RWA.
U.S. BHCs, including Truist, are subject to a range of prudential standards and requirements based on their size and complexity. Under the Tailoring Rules, Truist is subject to the standards applicable to Category III banking organizations, which generally include BHCs with greater than $250 billion, but less than $700 billion, in total consolidated assets and less than $75 billion in certain risk-related exposures. Truist is therefore 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 banking organizations are subject to even more enhanced prudential standards and requirements than Truist.
Certain BHCs and their bank subsidiaries, including Truist and Truist Bank, are subject to a minimum LCR and NSFR. The LCR rule requires that banking organizations maintain an amount of eligible HQLA that is sufficient within the parameters of the rule to meet estimated total net cash outflows over a prospective 30 calendar-day period of stress. The NSFR rule defines a minimum amount of stable, long-term funding that banking organizations must maintain in relation to their asset composition and off-balance sheet activities. The NSFR, calculated as the ratio of available stable funding to required stable funding, must exceed 1.0x for banking organizations required to meet the full requirement. Available stable funding represents a weighted measure of a company's funding sources over a one-year time horizon, calculated by applying standardized weightings to the Company's equity and liabilities based on their expected stability. Required Stable Funding is calculated by applying standardized weightings to assets, derivatives exposures, and certain other items based on their liquidity characteristics. As a Category III banking organization, Truist and Truist Bank are subject to LCR and NSFR requirements equal to 85% of the full requirement.
Truist also is subject to FRB rules that require certain large BHCs to conduct internal liquidity stress tests over a range of time horizons, maintain a buffer of highly liquid assets sufficient to meet projected net outflows under the BHC's 30-day liquidity stress test, and maintain a contingency funding plan.
At March 31, 2026, the Company was compliant with the NSFR requirement. Truist's "Liquidity Coverage Ratio Disclosures" and "Net Stable Funding Ratio Disclosures" are located on its website at ir.truist.com/regulatory-disclosures.
See Truist's Annual Report on Form 10-K for the year ended December 31, 2025 and Quarterly Report on Form 10-Q for the period ended March 31, 2026, for a discussion of requirements for Category III banking organizations.
Management regularly monitors the capital position of Truist on both a consolidated and bank-level basis. In this regard, management's objective is to maintain capital at levels that are in excess of internal capital minimums, which are above the regulatory "well-capitalized" minimums. Truist also regularly performs stress testing on its capital levels and is required to periodically submit its capital plans and stress testing results to the banking regulators. Management has implemented internal stress capital ratio thresholds that serve as limits to evaluate whether capital ratios calculated under hypothetical stress, and after the effect of alternative capital actions, are likely to remain above internal stressed minimums. Breaches of internal capital minimums, or projected breaches of internal stress capital ratio minimums under hypothetical stress, result in the activation of Truist's capital contingency plan.
Under the FRB's CCAR process and related capital plan rule, Truist must submit an annual capital plan to the FRB that reflects its projected financial performance under hypothetical macro-economic scenarios, including stress scenarios designated by Truist and a supervisory severely adverse scenario provided by the FRB.
The FRB's CCAR framework and the Dodd-Frank Act stress testing framework also require BHCs subject to Category III standards, such as Truist, to conduct company-run stress tests and submit to supervisory stress tests conducted by the FRB. Company-run stress tests employ stress scenarios provided by the FRB and incorporate the Dodd-Frank Act capital actions, intended to normalize capital distribution assumptions across large U.S. BHCs. Truist is required to conduct annual stress tests using internally-developed scenarios tailored to its unique risk profile. The FRB conducts CCAR and Dodd-Frank Act supervisory stress tests employing internal supervisory models and supervisory stress scenarios. As a Category III banking organization, Truist is subject to annual supervisory stress testing and biennial company-run stress testing requirements.
Truist seeks to maintain a comprehensive risk management framework supported by people, processes, and systems designed to identify, assess, measure, monitor, control, mitigate, govern, and report on risks arising from exposures and business activities. Truist has established an enterprise risk management framework to enable the execution of strategic goals and objectives in alignment with its risk appetite.
Truist's risk appetite is defined as the level of risk exposure Truist is willing to assume to realize its purpose, mission, and values, as well as to achieve its strategic objectives, deliver shareholder returns, and maintain the safety and soundness of Truist. Truist's RMO provides independent oversight and guidance for risk-taking across the enterprise. In keeping with the belief that consistent values drive long-term behaviors, Truist's RMO has established four key behaviors all teammates are expected to practice daily, regardless of role:
Awareness: demonstrate an appropriate understanding of enterprise and business unit risks and the controls required to effectively mitigate those risks. Complete required risk and compliance training within deadlines. Comply with applicable risk-related Truist policies.
Disclaimer
Truist Financial Corporation published this content on May 11, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 11, 2026 at 20:49 UTC.