Oct 16, 2026 earnings call — Record revenue and Q4 NIM outlook
Record third-quarter revenue and the Board raised repurchase capacity to 1.95 billion while increasing the dividend to $0.52 per share.
Revenue $2.3B (est $2.3B) · EPS $1.41 (est $1.39)
Key quotes
"The private bank continues to make excellent progress. The private bank again delivered strong deposit growth ending the quarter at $18.5 billion"
"Average demand deposits were up 2% which helped mitigate the increase in overall deposit costs, which were up 3 basis points."
"We expect to exit 2026 with about $100 million of annualized pretax benefit. Then more than double that to $225 million by the end of 27."
Analyst Q&A 10
Reaching 2027 profit and margin goal
Q (Scott Siefers · TD Cowen): Analyst asked how the change in interest rates affects reaching the $330 million and 30% margin target by year-end 2027. He wanted to know what will make the goal easier or harder, like deposit pricing or other moving parts.
A: Management said several steady drivers help even if rates change: time-based benefits from legacy swaps rolling off, a favorable front-book/back-book yield dynamic, focus on growing low-cost deposits especially in private bank and consumer, and targeted loan growth in commercial and private bank. They are asset sensitive so more Fed hikes would help net interest income.
"The so called time based benefits as we described them with legacy swaps accounting drag rolling off every quarter." — Bruce Winfield Van Saun (CEO·CHAIR)
Deposit cost trajectory and beta
Q (John Pancari · Evercore): Analyst asked for updated views on deposit pricing after the rate spike, the expected trajectory of deposit costs, and an updated deposit beta. He also asked how noninterest versus interest-bearing mix might change.
A: Management said deposit competition is familiar and they expect deposit beta in the high-40s on a retracement up like prior cycles. They are pleased with deposit performance and highlighted private bank DDA growth and steady low-cost mix, giving confidence that deposit costs will be managed despite rate moves.
"As Bruce mentioned, like when rates were coming down, we were roughly around in the high-40s beta." — Aunoy Banerjee (CFO)
Capital markets fee outlook
Q (Morgan Stanley): Analyst asked how confident management is in fourth-quarter fee income guidance and whether middle-market sponsor activity is sustainable. He also asked about private credit competition on the loan side.
A: Management said they feel very strongly about the capital markets pipeline, with M&A pipeline at its highest, higher quality deals, and a large backlog into Q4 and 2027; DCM had some slips but pipeline is growing. On private credit, activity fell in Q2 but has leveled off; private credit behavior has not materially changed in the past two quarters.
"We feel very strongly about where we are in the capital market side right now." — Theodore C. Swimmer
Private Bank growth drivers
Q (David Chiaverini · Jefferies): Analyst asked what is driving the strong Private Bank growth this quarter and the outlook. He also asked how much Citizens is financing the AI/data center build-out.
A: Management said growth comes from brand expansion, lots more bankers and new markets, recruiting teams with client follow-through, and stronger referrals from commercial and capital markets, which is accelerating loans and sustaining returns. On data centers, they have moved from advisory to financing, participate in construction then shift to permanent financing, and they hedge exposures and focus on disciplined holds.
"We are expanding markets as you heard from us this week, we have built into Southern California." — Brendan Coughlin (PRESIDENT)
Why NII growth may slow in 2027
Q (Erika Najarian · UBS): Analyst asked why net interest income growth might slow from this year's 10–12% guide into 2027, given time-based benefits, asset sensitivity, and earning asset growth.
A: Management said they will not give 2027 guidance yet and noted much of the big time-based NIM benefit was front-loaded into the recent period. They expect continued NIM expansion but likely less than the large prior quarterly gains, while Reimagine the Bank effects are incremental and may affect timing of expense and one-time costs.
"Well, first off, Erika, we are not going to give 2027 guidance yet." — Bruce Winfield Van Saun (CEO·CHAIR)
Buybacks and capital ratios
Q (Chris McGratty · KBW): Analyst asked about bias within the 16–18% ROTCE target and how recent rate moves and AOCI changes affect buyback pace and adjusted CET1 decisions.
A: Management said they are monitoring adjusted ratios and may let CET1 gross ratio drift up above 10.5% while considering Basel III RWA relief and AOCI dynamics. They feel capital generation is strong and can operate at current levels, so they plan to buy back stock while being cautious on ratios.
"Yes, we called out in the prepared remarks that we are you know, monitoring those ratios, the adjusted ratios." — Bruce Winfield Van Saun (CEO·CHAIR)
Improving consumer franchise and Next program
Q (Ebrahim Poonawala · BofA): Analyst asked about Matt joining and actions to improve the consumer franchise over the past five years and where the next opportunities lie for consumer growth.
A: Management said they rebuilt leadership and transformed the consumer bank to a stronger deposit base and relationship-oriented loan book, then shifted to durable revenue streams like wealth; they will add specialty job families, more wealth and private client bankers, and reshape branches to target mass affluent customers. These moves aim to increase sticky deposits, wealth revenue growth, and long-term market share.
"Matt, it is been a excellent add to the team, and you have seen us reload the entire leadership team, in many ways over the last 12 to 18 months." — Brendan Coughlin (PRESIDENT)
Seasonality and deposit growth path
Q (Ken Usdin · Autonomous): Analyst asked about consumer seasonality, why interest-bearing end-of-period deposits were flat, and whether higher wholesale funding this quarter will reverse as deposits re-accelerate.
A: Management said Q4 is seasonally strong across commercial, private bank, and consumer, so they expect strong spot deposit growth and reduced FHLB advances by year-end. They highlighted gaining operating accounts and steady DDA plus low-cost mix at about 42%, which helps keep deposit costs in check.
"Yes, I am just going to start and I will quickly turn to Aunoy, but the fourth quarter Ken has always been seasonally strong for us, always in the commercial space." — Bruce Winfield Van Saun (CEO·CHAIR)
Private bank fee mix vs NII
Q (Gerard Cassidy · RBC): Analyst asked whether growth of the private bank will shift revenue mix toward more fee income as it becomes a national franchise, versus net interest income from banking growth. He also asked about competition and returns in C&I.
A: Management said they expect wealth to grow faster and drive fee income over time, but rapid banking balance growth has consumed some fee mix gains so improvements will be steady not radical. On commercial, they focus on left-lead relationships, will avoid low-return deals, and pulled out of $400 million of assets in corporate credit when returns were insufficient.
"We expect wealth to grow in an outsized way, and that will be primary driver of fee income coming through the private bank as you would expect." — Brendan Coughlin (PRESIDENT)
CRE prepay/payoff impact from higher rates
Q (Matthew Breese · Stephens Incorporated): Analyst asked whether higher rates have slowed prepayments and payoffs in commercial real estate, and how reality compares to expectations. He also asked period-end cost of deposits and expectations with one more Fed hike.
A: Management said higher rates have not yet materially impacted CRE prepayments; their analysis shows about $400 million could be delayed, which they do not view as material. On deposit cost, they noted reprice timing varies by segment and that commercial reprices immediately while private bank and consumer have lags, and being asset sensitive they expect loan yields to rise more than deposit costs.
"I think long story short, we think somewhere in the neighborhood of $400 million after all the analysis we did, but that is about as much as we see potentially being delayed because of higher rates at this point." — Theodore C. Swimmer