TFC - Truist Financial Corporation (TFC) Bernstein's 40th Annual Strategic Decisions Conference (Transcript)
2024-05-31 15:19:09 ET
Truist Financial Corporation (TFC)
Bernstein's 40th Annual Strategic Decisions Conference
May 30, 2024, 10:00 AM ET
Company Participants
Bill Rogers - Chairman and CEO
Conference Call Participants
John McDonald - Bernstein
Presentation
John McDonald
[abrupt start]
CEO and Chairman, Bill Rogers. Bill, thanks for joining us again this year.
Bill Rogers
Great to be here, John.
Question-and-Answer Session
Q - John McDonald
So Bill, I'll start off with the recent events. You recently completed the sale of Truist Insurance, simultaneous securities positioning. Maybe for starters, give us a little background on the thought process that led up to those transactions. And then we'll shift to how that positions you for the future.
Bill Rogers
Yes, John, this has been a part of a overall strategic framework. If you think about some of the merger, the first part of the merger was to put everything together, do no harm, get our clients through in a really great fashion. Reinstate sort of great client experience. Every client had to go through a change. Every teammate had to go through a change.
And then so for the last couple of years, we've been on a really good framework with the Board on sort of overall strategically, what do we want Truist to look like. How do we want the company to be capitalized. Where do we want to invest.
And what we saw on the insurance side, great business, by the way, a great long history. Just from the merger, we've invested probably 90-plus basis points of capital in the growth in the insurance business.
And what we saw is similar, actually, a lot of industries, banking, similar is insurance business was growing really quickly for different reasons, but consolidating different -- really quickly, consolidate a lot with private equity. And what we saw is as we look towards the future is we're going to have another 100-plus basis points of capital investment in insurance business to keep it strong, keep it growing.
The acquisitions were going to be bigger versus smaller. J curves are going to be deeper in terms of dilution. So from a strategic framework, we said, okay, we actually have to think about that, and we sort of have to make sure that we position it for the future. The first place we started was doing a minority sale with a concept that we could continue to build capital from that based upon acquisitions. I also changed a lot of that view about minority positions in companies.
So we moved to more of a strategic decision of if we want to be in the insurance business, it was going to require a little more capital than we thought was appropriate relative to our total company. So that was sort of the premise of the decision....
Truist Financial Corporation (TFC) Bernstein's 40th Annual Strategic Decisions Conference (Transcript)