Citizens Financial Group CFG reported first-quarter 2026 earnings per share (EPS) of $1.13, which surpassed the Zacks Consensus Estimate of $1.10 per share. The metric rose 47% from the year-ago quarter.
Results benefited from a rise in net interest income (NII) and non-interest income. The increase in loan and deposit balances was also encouraging. However, a rise in expenses was a major headwind. Given the concern, the company’s shares lost nearly 1% in the pre-market trading session.
Net income (GAAP basis) was $517 million, which rose 39% from the prior-year quarter.
CFG’s Revenues & Expenses Rise
Total revenues in the first quarter were $2.17 billion, which topped the Zacks Consensus Estimate by 0.4%. The top line rose 12% year over year.
Citizens Financial’s NII rose 12% year over year to $1.56 billion, driven by higher net interest margin and growth in interest-earning assets.
The net interest margin (NIM) expanded 24 basis points year over year to 3.14%, driven by the benefits of non-core runoff and terminated swap impacts, as well as fixed-rate asset repricing benefits, partially offset by lower asset yields.
Non-interest income increased 11% year over year to $606 million. The improvement was driven by higher capital markets fees, wealth fees and other income.
Non-interest expenses increased 5% year over year to $1.38 billion. The rise was primarily due to higher salaries and employee benefits, equipment and software costs and higher outside services costs.
The efficiency ratio was 63.6% in the first quarter compared with 67.9% in the year-ago quarter. A fall in the efficiency ratio reflects improved profitability.
Citizens Financial’s Loan Balance & Deposits Up Sequentially
As of March 31, 2026, period-end total loans and leases were $143.7 billion, up nearly 1% from the prior quarter, while total deposits rose marginally to $184 billion on a sequential basis.
CFG’s Credit Quality Improves
As of March 31, 2026, Citizens Financial’s provision for credit losses was $140 million, which declined 8% from the year-ago quarter.
The allowance for credit losses decreased 1% year over year to $2.2 billion.
Net charge-offs decreased to $138 million from $200 million in the prior-year quarter.
Non-accrual loans and leases declined 5% year over year to $1.5 billion.
CFG’s Capital Position Weak
As of March 31, 2026, the common equity tier 1 (CET1) capital ratio was 10.5%, down from 10.6% in the prior-year quarter.
The total capital ratio was 13.7%, down from 13.9% in the year-ago quarter. The tier 1 leverage ratio was 9.3%, which decreased from 9.4% in the prior-year quarter.
Citizens Financial’s Share Repurchase Update
In the first quarter of 2026, CFG repurchased $300 million of common shares and paid $198 million in common dividends.
Our View on CFG
Citizens Financial’s solid first-quarter results reflect its balanced growth across NII and fee income, along with improved efficiency and stable credit quality. While expense pressures and a weaker capital position remain concerns,the company’s strong liquidity and shareholder-friendly policies position it well for sustained performance ahead.
Citizens Financial Group, Inc. Price, Consensus and EPS Surprise
Citizens Financial Group, Inc. price-consensus-eps-surprise-chart | Citizens Financial Group, Inc. Quote
Currently, Citizens Financial carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Dates & Expectations of Bank Stocks
Huntington Bancshares Inc. HBAN is slated to report first-quarter 2026 results on April 23.
Over the past seven days, the Zacks Consensus Estimate for HBAN’s quarterly earnings has been unchanged at 36 cents per share.
Bank of Hawaii BOH is scheduled to announce first-quarter 2026 numbers on April 20.
Over the past seven days, the Zacks Consensus Estimate for BOH’s quarterly earnings has been unchanged at $1.33 per share.
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Huntington Bancshares Incorporated (HBAN): Free Stock Analysis Report
Bank of Hawaii Corporation (BOH): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).