Truist Financial Corp (NYSE:TFC) Q2 2020 Earnings Conference Call - Final Transcript

Jul 16, 2020 • 08:00 am ET

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Truist Financial Corp (NYSE:TFC) Q2 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

Yes, sir. [Operator Instructions] All right, and we'll take our first question from Betsy Graseck with Morgan Stanley.

Analyst
Betsy Graseck

Hi, good morning.

Executive
Kelly S. King

Hey, good morning.

Executive
Daryl N. Bible

Good morning.

Analyst
Betsy Graseck

Kelly, I just wanted to dig in a little bit on the expense side. You mentioned that you're pulling forward the cost saves over the next couple of quarters. And maybe you can remind us how far along on that $640 million you are already as of 2Q. And then, give us some sense in the discussions you had to accelerate that in 2020. What else you found that maybe you could add to the profitability opportunities here in 2021 as well? I know you kept the 65% flat. But knowing you, I'm sure you unearthed a few other potential items of costs saves.

Executive
Kelly S. King

Yes, Betsy, as you would expect, we're doing a deep dive in all of those areas to be sure that we can continue to provide high-performance profitability metrics, even as we orchestrate through this difficult environment. The pulling forward is just frankly getting more aggressive than we had even originally planned with regard to vendor renegotiations. We've got a ton of buildings, as you might expect duplicative buildings, some small, some large. We've got a major task-force working on that. And we decided to be very aggressive in terms of consolidating and eliminating a lot of those buildings. And that's pretty immediate cost reductions when you do that. We have a very aggressive personnel rationalization plan in process. And a good bit of that is already underway in 2Q as you alluded to. It will begin to flow down to the bottom line more in 3Q and 4Q as we get executing on that. The plans are well developed. And now, it's just a matter of executing on the plans.

Now, keep in mind that while we're now calling this out, as we head into the remainder of this year and 2021, we also have some really good opportunities in terms of revenue. Our Integrated Relationship Management program is going extremely well. And we are redoubling our efforts with regard to that, because this is the time when our clients need us more than ever. And so, we are across the organization focusing on generating opportunities to help our clients and, of course, in the -- so doing, we generate additional revenue for us. So we've got all of these expense initiatives, but they're huge revenue initiatives as well, which gives us great confidence. We're focusing on the expense with you. From day one, we didn't add in revenue opportunities as a part of projecting. But I can just tell you that the development along the way in terms of realizing those revenue synergies is going far better than I would have ever expected, including all of the COVID difficulties related to that.

Executive
Daryl N. Bible

The only thing I would add to that, Betsy, is that, in the first -- or second quarter, we had some COVID-related expenses. We talk about them, but