Truist to sell $5.5B auto loans, exit near-prime
Truist Financial Corporation (TFC) announced a strategic exit from its near-prime auto lending business by entering into an agreement to sell $5.5 billion of auto loans, representing substantially all assets of its Regional Acceptance Corporation unit.
Rhea-AI Filing Summary
Truist Financial Corporation (TFC) announced a strategic exit from its near-prime auto lending business by entering into an agreement to sell $5.5 billion of auto loans, representing substantially all assets of its Regional Acceptance Corporation unit. Closing is anticipated in late third or early fourth quarter 2026, subject to customary conditions.
The transaction is expected to generate $5.2 billion of net proceeds, a $535 million loan loss reserve recapture, and create $945 million of CET1 capital, or about 22 basis points of CET1 capital. Truist indicates the actions should reduce nonperforming loans and net charge-offs, support its unchanged $5 billion 2026 share repurchase target, and be modestly accretive to earnings, tangible book value, and ROTCE.
Positive
- $5.5B RAC auto loan sale exits a non-core, less profitable near-prime auto business and sharpens Truist’s strategic focus.
- Deal expected to generate $5.2B net proceeds and $945MM (22 bps) of CET1 capital, strengthening capital and funding flexibility.
- Management expects the actions to be modestly accretive to earnings, tangible book value, and ROTCE while the $5B 2026 share repurchase target remains unchanged.
- Credit risk profile is expected to improve with NPLs reduced by more than 10 bps and NCOs by about 10 bps annually.
Negative
- None.
Filing Explained
The RAC sale is agreed but not closed, while proposed proceeds deployment remains conditional rather than committed.
This Form 8-K furnishes disclosure about a signed agreement to sell substantially all of Regional Acceptance Corporation’s auto-loan assets. The sale is not complete: closing is anticipated in late third quarter or early fourth quarter
The proposed repayment of wholesale borrowings and repositioning of certain available-for-sale securities are labeled illustrative liquidity and capital deployment actions, not completed transactions. The filing says any actions taken would depend on market conditions; therefore, it does not establish a committed use of the prospective proceeds.
The material state change to watch is satisfaction of the customary closing conditions and completion of the RAC sale, after which the company could report which proceeds-deployment actions were actually undertaken.
8-K Event Classification
2 items: 7.01, 9.01
2 items
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, or exhibit attachments filed with this report.
Key Figures
Auto loans sold: $5.5 billion
Net proceeds: $5.2 billion
Loan loss reserve recapture: $535 million
+5 more
8 metrics
Auto loans sold
$5.5 billion
Auto loans representing substantially all assets of Regional Acceptance Corporation to be sold
Net proceeds
$5.2 billion
Expected net proceeds from RAC auto loan sale
Loan loss reserve recapture
$535 million
Recapture reflecting difference between purchase price and loan amount net of reserve
CET1 capital created
$945 million
Capital created by RAC sale, equal to 22 basis points of CET1 capital
CET1 capital increase
22 basis points
Impact of RAC sale on CET1 capital ratio
After-tax reserve recapture
$410 million
Component of CET1 capital increase from after-tax loan loss reserve recapture
Capital from RWA reduction
$600 million
Capital created by reduction in risk-weighted assets
2026 share repurchase target
$5 billion
Stated share repurchase target for 2026, unchanged after strategic actions
Key Terms
near-prime auto lending, loan loss reserve recapture, CET1 capital, NPLs, +2 more
6 terms
near-prime auto lending financial
"Strategic exit of near-prime auto lending and illustrative AFS repositioning"
loan loss reserve recapture financial
"$535MM loan loss reserve recapture reflects difference between purchase price"
CET1 capital financial
"Creates $945MM or 22 bps of CET1 capital"
Common Equity Tier 1 (CET1) capital is a bank’s core financial cushion made up mainly of common shares and retained profits, minus items like goodwill, that regulators count first when judging a bank’s strength. It matters to investors because a higher CET1 ratio signals a bigger buffer to absorb losses, supports dividend payments and growth, and reduces the risk of regulatory restrictions—think of it as a household emergency fund that keeps the bank solvent under stress.
NPLs financial
"Reduces NPLs by >10 bps as of June 30, 2026"
Non-performing loans (NPLs) are loans where borrowers have stopped making scheduled payments for a prolonged period or are judged unlikely to resume payments. They matter to investors because rising NPLs erode a lender’s income and capital—forcing bigger loss reserves, cutting profits, and increasing the risk that a bank’s assets will lose value; imagine many unpaid IOUs dragging down the value of an investment portfolio.
NCOs financial
"and NCOs by ~10 bps annually"
AFS securities financial
"Reposition certain AFS securities to fully offset capital created from RAC sale"
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What transaction did TFC announce involving Regional Acceptance Corporation?
Truist entered into an agreement to sell $5.5 billion of auto loans representing substantially all assets of Regional Acceptance Corporation. Closing is anticipated in late third or early fourth quarter 2026, subject to customary closing conditions.
How much capital does Truist (TFC) expect to create from the RAC loan sale?
Truist expects the RAC sale to create $945 million of CET1 capital, equivalent to about 22 basis points of CET1. This comes from an after-tax loan loss reserve recapture and reduced risk-weighted assets, partially offset by after-tax transaction costs.
What are the expected proceeds from Truist’s RAC loan sale?
The transaction is expected to generate $5.2 billion of net proceeds and a $535 million loan loss reserve recapture, based on the difference between the purchase price and the loan amount net of reserve.
How will the RAC sale affect Truist’s credit metrics like NPLs and NCOs?
Truist expects the transaction to reduce nonperforming loans by more than 10 basis points as of June 30, 2026, and lower net charge-offs by about 10 basis points annually, improving its credit risk profile.
What strategic shift is Truist (TFC) making with this transaction?
Truist is exiting near-prime auto lending by selling substantially all RAC assets. This aligns with prior exits like discontinued Marine/RV lending and is part of a broader ongoing strategic review.
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________
Form 8-K
Current Report
_____________________________
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
(Exact name of registrant as specified in its charter)
_____________________________
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||
(Address of principal executive offices) | (Zip Code) | |||||||
(844 ) 487-8478
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report.)
_____________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
ITEM 7.01 Regulation FD Disclosure.
Mike Maguire, Chief Financial Officer of Truist Financial Corporation (“Truist”), will speak at the Barclays Global Financial Services Conference in New York City on Tuesday, September 15, 2026 at 10:30 a.m. ET. In connection with Mr. Maguire’s presentation, Truist is disclosing information about a recently signed transaction related to its strategic decision to exit the near-prime auto lending business and the potential financial impacts and illustrative uses of proceeds from the transaction, which information is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference herein.
Information contained on Truist’s website is not incorporated by reference into this Current Report on Form 8-K. The information in the preceding paragraph, as well as Exhibit 99.1, are being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section. Such information may only be incorporated by reference into another filing under the Exchange Act or the Securities Act of 1933, as amended, if such subsequent filing specifically references Item 7.01 of this Current Report on Form 8-K.
Exhibit 99.1 contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as "believe," "expect," "anticipate," "intend," "pursue," "seek," "continue," "estimate," "project," "outlook," "forecast," "potential," "target," "objective," "trend," "plan," "goal," "initiative," "priorities," or other words of comparable meaning or future-tense or conditional verbs such as "may," "will," "should," "would," or "could." Forward-looking statements convey Truist’s expectations, intentions, or forecasts about future events, circumstances, or results. All forward-looking statements, by their nature, are subject to assumptions, risks, and uncertainties, which may change over time and many of which are beyond Truist’s control. You should not rely on any forward-looking statement as a prediction or guarantee about the future. Actual future objectives, strategies, plans, prospects, performance, conditions, and results may differ materially from those set forth in any forward-looking statement. While no list of assumptions, risks, and uncertainties could be complete, some of the factors that may cause actual results or other future events or circumstances to differ from those in Truist’s forward-looking statements include the risks and uncertainties more fully discussed in Part I, Item 1A (Risk Factors) in Truist’s most recently filed Annual Report on Form 10-K and in Truist’s subsequent filings with the Securities and Exchange Commission. Any forward-looking statement made by Truist or on its behalf speaks only as of the date that it was made. Truist does not undertake to update any forward-looking statement to reflect the impact of events, circumstances, or results that arise after the date that the statement was made, except as required by applicable securities laws. You, however, should consult further disclosures (including disclosures of a forward-looking nature) that Truist may make in any subsequent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, or Current Report on Form 8-K.
ITEM 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | |||||||
99.1 | Disclosure Material of September 15, 2026 (furnished with the Commission as a part of this Form 8-K) | |||||||
| 104 | The cover page from this Current Report on Form 8-K, formatted in Inline XBRL | |||||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
TRUIST FINANCIAL CORPORATION | ||||||||
(Registrant) | ||||||||
| By: | /s/ Cynthia B. Powell | |||||||
| Cynthia B. Powell | ||||||||
| Executive Vice President and Corporate Controller | ||||||||
| (Principal Accounting Officer) | ||||||||
Date: September 15, 2026
Overview of transaction − Entered into an agreement to sell $5.5B of auto loans representing substantially all assets of Regional Acceptance Corporation (RAC) − Closing anticipated in late 3Q26 or early 4Q26, subject to satisfaction of customary closing conditions Financial impact of RAC sale − 3Q26 and 2026 outlook unchanged excluding impact of strategic actions1 − RAC pre-tax earnings were approximately breakeven through the six months ended June 30, 2026 − Generates $5.2B of net proceeds and a $535MM loan loss reserve recapture2 − Creates $945MM or 22 bps of CET1 capital3 − Reduces NPLs by >10 bps as of June 30, 2026, and NCOs by ~10 bps annually Illustrative liquidity and capital deployment actions4 − Repay wholesale borrowings with proceeds from loan sale − Reposition certain AFS securities to fully offset capital created from RAC sale 2027 impact of strategic actions − Expect these strategic actions to create modest earnings and ROTCE accretion Strategic exit of near-prime auto lending and illustrative AFS repositioning Sharpens strategic focus − Exits non-core, less profitable near prime auto lending − Consistent with prior actions (discontinued Marine/RV) − Broader strategic review is ongoing Strengthens balance sheet − Enhances liquidity and funding profile − Maintains capital strength and flexibility − 2026 share repurchase target unchanged at $5B Improves credit risk profile − Reduces NPLs and NCOs − Strengthens resilience across stress environments Enhances shareholder value − Modestly accretive to earnings and tangible book value − Improves capital efficiency All financial metrics are preliminary estimates 1 Strategic actions include RAC loan sale and illustrative liquidity and capital deployment actions 2 $535MM loan loss reserve recapture reflects difference between purchase price and loan amount net of reserve 3 $945MM capital increase driven by a $410MM after-tax loan loss reserve recapture and $600MM of capital created by a reduction in risk-weighted assets partially offset by $65MM of after-tax transaction related costs 4 Any actions undertaken would be subject to market conditions