Fifth Third Bank expects to increase noninterest expenses slightly in 2024 as technology investment ticks up at the bank.
Noninterest expenses in the fourth quarter fell 7% year over year to $1.5 million, but are expected to increase 1% overall in 2024, Bryan Preston, executive vice president and chief financial officer, said during today’s Q4 earnings call.
As noninterest expenses fell, technology and communication costs grew 5% YoY in the quarter to $117 million, according to the bank’s earnings supplement.
“Our expense outlook assumes continued investments in technology, with tech expense growth in the mid to high single digits,” Preston said.
BIGGER PICTURE: As part of the bank’s tech investments, in May, Fifth Third acquired embedded payments fintech Rize Money to enhance its overall financial product offerings, according to a Fifth Third release.
BY THE NUMBERS: Fifth Third reported in Q4:
- Net interest income fell to $1.4 billion, from $1.6 billion in Q4 2022;
- Efficiency ratio was 67.2% compared to 52.6% during the same period last year;
- Total revenue increased 4% YoY to $2.2 billion;
- Net income grew 10% YoY to $1.5 billion; and
- Headcount fell 3% YoY to 18,724.
NOTEWORTHY: The bank made the following executive changes in Q4, effective Jan. 2:
- Chief Executive Tim Spence was appointed chairman of the board;
- Chief Financial Officer Jamie Leonard was named chief operating officer;
- Treasurer Bryan Preston was named chief financial officer; and
- Brennen Willingham, who is the managing director of capital, liquidity and corporate development, became treasurer.
“These changes are designed to best position Fifth Third for the future,” Spence said.
FUTURE LOOK: Jude Schramm, executive vice president and chief information officer at Fifth Third, will speak at Bank Automation Summit U.S. 2024 on Monday, March 18, at 1:15 p.m. CT.
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