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Exhibit 99.1
Citizens Financial Group, Inc. Reports First Quarter Net Income of $34 million
and EPS of $0.03 with Underlying Net Income of $59 million and EPS of $0.09*
CECL-related reserve build of $463 million, or $0.85 per share, tied to
COVID-19 impacts
CET1 ratio remains strong at 9.4%
Record noninterest income up 16% year over year, paced by record results in Mortgage and Wealth
Tangible book value per share of $32 up 8% year over year
PROVIDENCE, RI (April 17, 2020) Citizens Financial Group, Inc. (NYSE: CFG or Citizens) today reported first quarter net income of $34 million, compared with $439 million in first quarter 2019, with earnings per share of $0.03, compared with $0.92 per share in first quarter 2019. First quarter 2020 results reflect a net $25 million, or $(0.06) per share,
after-tax reduction from notable items compared with a net $4 million, or $(0.01) per share, in first quarter 2019 and a net $4 million, or $(0.01) per share, in fourth quarter 2019. First quarter 2020 Return on Average Tangible Common Equity* (ROTCE) of 0.4% compares with 13.0% in first quarter 2019.On an Underlying basis, which excludes notable items, first quarter 2020 net income available to common stockholders of $37 million compares with $428 million in first quarter 2019 and $431 million in fourth quarter 2019. Underlying EPS of $0.09 per share compares with $0.93 in first quarter 2019 and $0.99 in fourth quarter 2019. Underlying first quarter 2020 ROTCE of 1.1% compares with 13.1% in first quarter 2019 and 12.5% in fourth quarter 2019. Tangible book value per common share of $31.97 increased 8% from first quarter 2019 and remained relatively stable with fourth quarter 2019.
In first quarter 2020, Citizens adopted the Current Expected Credit Loss (CECL) accounting standard and recorded first quarter 2020 provision for credit losses of $600 million pre-tax, or $1.10 per share after-tax, including a reserve build under CECL of $463 million pre-tax, or $0.85 per share after-tax, tied to COVID-19 impacts. On an Underlying basis and before the $463 million COVID-19 CECL-related reserve build, first quarter 2020 net income available to common stockholders reflecting net charge-offs totaled $402 million, EPS was $0.94 per share, and ROTCE was 12.0%.
Citizens saw spot loan growth of $8.4 billion, or 7% in first quarter 2020 compared with fourth quarter 2019, including $7.2 billion of commercial client line draws under revolving credit facilities. We remain strongly capitalized and maintain ample liquidity to assist companies in navigating these challenging times. At March 31, 2020, CET1 capital was 9.4%, spot LDR was 95.5%, and LCR was fully compliant. Citizens has worked with borrowers on forbearance, and as of April 15, 2020 had seventy thousand consumers in forbearance and was working proactively with commercial customers seeking flexibility on loan terms and conditions. In addition, Citizens has been active in securing financing through the U.S. Small Business Administration Payment Protection Program (PPP) for its small business customers.
*References in this release to Underlying results exclude notable items and are Non-GAAP Financial Measures. Where there is a reference to Underlying results in a paragraph, all measures that follow these references are on the same basis. Additional information regarding the impact of notable items and Acquisitions on our results is described in this release. Please see the end of this release for important information on our use of Key Performance Metrics and Non-GAAP Financial Measures, as applicable, and their reconciliation to GAAP financial measures. References in this release to balance sheet items are on an average basis and loans exclude loans held for sale (LHFS) unless otherwise noted. References to net interest margin are on a fully taxable equivalent (FTE) basis and all references to earnings per share represent fully diluted per common share. References to consolidated and/or commercial loans, loan growth, nonaccrual loans and allowance for loan losses include leases. The Company refers to Citizens. Current reporting-period regulatory capital ratios are preliminary. Select totals may not sum due to rounding.
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Citizens Financial Group Incri's Definitive Proxy Statement (Form DEF 14A) filed after their 2020 10-K Annual Report includes:
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Mortgage banking fees of $159 Citizens Financial Group, Inc. | 14 million reflected increased origination volumes and improved gain on sale margins, as well as higher mortgage servicing rights hedging gains.
Net income of $34 million decreased 92% from the first quarter of 2019, with earnings per diluted common share of $0.03, down $0.89 from $0.92 per diluted common share in the first quarter of 2019.
Due in part to its subjectivity, the qualitative evaluation may be materially impacted during periods of economic uncertainty and late breaking events could lead to revision of reserves to reflect management's best estimate of expected credit losses.
Improvement in credit losses in subsequent periods results in a reversal of the allowance for AFS securities and a corresponding decrease to provision expense, to the extent the allowance does not become negative.
This netted derivative asset or liability position is also netted against the fair value of any cash collateral that has been pledged or received in accordance with a master netting agreement.
An accounting estimate requires assumptions...Read more
Further, certain of these metrics...Read more
Commercial loans and leases that...Read more
Provision for credit losses of...Read more
The initial indicator of impairment...Read more
There have been no significant...Read more
The Executive Risk Committee ("ERC"),...Read more
On June 27, 2019, our...Read more
Average interest-earning asset yields of...Read more
Amortization expense recognized on intangible...Read more
Citizens Financial Group, Inc. |...Read more
The following table provides information...Read more
Any subsequent increases in the...Read more
Certain fair value hedges have...Read more
There have been no significant...Read more
For any security that has...Read more
The following table presents other...Read more
Impairment indicators evaluated included economic...Read more
In response to the crisis,...Read more
The credit-related portion of impairment...Read more
This market risk is substantially...Read more
The level of net interest...Read more
Citizens Financial Group, Inc. |...Read more
Net charge-offs of $137 million...Read more
As of March 31, 2020,...Read more
All of these swaps have...Read more
Citizens accounts for derivatives in...Read more
Consequently, and despite ongoing exposure...Read more
These monitoring tools are broadly...Read more
Income tax expense decreased $116...Read more
Nonaccruing commercial and commercial real...Read more
Average interest-earning assets of $150.9...Read more
Effective January 1, 2020, we...Read more
Effective January 1, 2020, the...Read more
We consider the effective and...Read more
As of April 30, 2020,...Read more
Tangible book value per common...Read more
Tangible book value per common...Read more
Net interest margin on an...Read more
Total borrowed funds costs of...Read more
Further weakening in the economic...Read more
Citizens Financial Group, Inc. |...Read more
Accordingly, our non-GAAP financial measures...Read more
We caution investors not to...Read more
Loans and leases that do...Read more
First quarter of 2020 net...Read more
Total revenue of $1.7 billion...Read more
There have been no significant...Read more
We believe these non-GAAP financial...Read more
There are certain loan portfolios...Read more
There are certain loan portfolios...Read more
Foreign exchange and interest rate...Read more
Known and estimated data include...Read more
Known and estimated data include...Read more
Provision for credit losses of...Read more
Other intangible assets are recognized...Read more
Citizens Access, our digital platform,...Read more
The interim assessment of goodwill...Read more
Non-GAAP measures are denoted throughout...Read more
On April 17, 2020, we...Read more
The table below presents the...Read more
Capital actions for the transition...Read more
Funding liquidity risk is the...Read more
The following table presents the...Read more
Market Risk Regulatory Capital The...Read more
- Average loans and leases...Read more
Certain prior period balances on...Read more
The decline in the fair...Read more
Retail TDRs that are deemed...Read more
The impairment loss recognized cannot...Read more
The Company's derivative instruments are...Read more
Upon purchase of HTM investment...Read more
- Net interest margin on...Read more
Other notable items include noninterest...Read more
Citizens has additional off-balance sheet...Read more
The ACL may also be...Read more
Provision for credit losses related...Read more
The ACL may also be...Read more
Similar to the 2018 DFAST...Read more
Consumer Banking Net interest income...Read more
The following table presents realized...Read more
We are committed to maintaining...Read more
In highly volatile economic environments...Read more
In highly volatile economic environments...Read more
We consider the following key...Read more
In the context of such...Read more
Commercial Banking Net interest income...Read more
The Company's projection of amortization...Read more
The following table presents our...Read more
Citizens' maximum exposure to loss...Read more
A summary of outstanding off-balance...Read more
We will continue to evaluate...Read more
Intangible assets are recorded in...Read more
Intangible assets are subject to...Read more
Citizens Financial Group, Inc. |...Read more
As of March 31, 2020,...Read more
The total capital ratio decreased...Read more
Financial Statements, Disclosures and Schedules
Inside this 10-Q Quarterly Report
Material Contracts, Statements, Certifications & more
Citizens Financial Group Incri provided additional information to their SEC Filing as exhibits
Ticker: CFG
CIK: 759944
Form Type: 10-Q Quarterly Report
Accession Number: 0000759944-20-000066
Submitted to the SEC: Thu May 07 2020 4:31:10 PM EST
Accepted by the SEC: Thu May 07 2020
Period: Tuesday, March 31, 2020
Industry: State Commercial Banks