TRUIST FINANCIAL CORP MANAGEMENT REPORT OF FINANCIAL POSITION AND OPERATING RESULTS (Form 10-Q)

MD&A is intended to assist readers in their analysis of the accompanying
Consolidated Financial Statements and supplemental financial information. It
should be read in conjunction with the Consolidated Financial Statements, the
accompanying Notes to the Consolidated Financial Statements in this Form 10-Q,
other information contained in this document, as well as with Truist's Annual
Report on Form 10-K for the year ended December 31, 2021.

Regulatory Considerations

The regulatory framework applicable to banking organizations is intended
primarily for the protection of depositors and the stability of the financial
system, rather than for the protection of shareholders and creditors. Truist is
subject to banking laws and regulations, and various other laws and regulations,
which affect the operations and management of Truist and its ability to make
distributions to shareholders. Truist and its subsidiaries are also subject to
supervision and examination by multiple regulators. The descriptions below
summarize updates since the filing of the Annual Report on Form 10-K for the
year ended December 31, 2021 to state and federal laws to which Truist is
subject. These descriptions do not summarize all possible or proposed changes in
current laws or regulations and are not intended to be a substitute for the
related statues or regulatory provisions. Refer to Truist's Annual Report on
Form 10-K for the year ended December 31, 2021 for additional disclosures.

In March 2022, the U.S. enacted federal legislation that is intended to minimize
legal and economic uncertainty following U.S. dollar LIBOR's cessation by
replacing LIBOR references in certain contracts under certain circumstances with
a SOFR-based rate to be established in a forthcoming FRB rule that incorporates
a spread adjustment specified in the statute. While some states have already
adopted LIBOR legislation, the federal legislation expressly preempts any
provision of any state or local law, statute, rule, regulation, or standard.

Executive Overview

The first quarter of 2022 marked a pivotal turning point for Truist as we
completed our final core bank conversion and are positioned to focus on
executional excellence. Our financial results for the first quarter of 2022 were
solid, though underlying results were mixed in light of market volatility and
geopolitical uncertainty. The continued favorable credit environment also led to
a strong credit performance and a benefit from the provision for credit losses.
Revenues were lower as a result of a challenging environment for investment
banking and mortgage, but we remain confident in our outlook given expectations
for higher interest rates, our diverse business model, and continued expense
discipline. At the same time, we acknowledge the increasing uncertainty
presented by a range of geopolitical and economic risks. See below for further
updates on our final integration and ESG efforts and a more detailed discussion
of our first quarter financial performance.

Merger Integration

Truist completed our largest conversion event during the first quarter of 2022,
transitioning nearly seven million clients to the Truist ecosystem and
rebranding more than 6,000 signs at branches, ATMs, and other locations. We now
operate officially as one brand and one bank to our clients. This accomplishment
was possible because of the expertise, purposeful commitment, and hard work of
thousands of teammates. We remain guided by our purpose as we continue
supporting our clients through the transition and look forward to shifting our
focus to executional excellence and purposeful growth throughout this year.

ESG

Environment

•Truist has joined the Partnership for Carbon Accounting Financials, and set
2030 goals to reduce Scope 1 and Scope 2 emissions by 35% each, and to reduce
water consumption by 25%, relative to 2019.
•We announced our goal to achieve net zero greenhouse gas emissions by 2050,
supporting our clients' transition to a low-carbon economy.

                                                 Truist Financial Corporation 37
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Social

•Truist continued to be ahead of schedule with regard to our $60 billion
Community Benefits Plan commitment.
•In January 2022, Truist announced Truist One Banking, a first-of-its-kind
approach to the checking account experience, designed to address clients' direct
feedback. Truist One Banking will be available to clients beginning in the
summer of 2022. The Truist One checking account features will include: no
overdraft fees; a $100 negative balance buffer for qualifying clients; an easily
accessible, deposit-based line of credit of up to $750; and premium rewards that
instantly recognize relationships and honor loyalty. In addition, Truist will
offer an alternative checking account product created for clients who are new to
credit and want simplicity and control without overdraft fees. It will help
clients avoid high fees from check-cashing and payday lenders, bring many more
households into mainstream banking, and create a pathway to upgrade to a Truist
One checking account.
•In March 2022, Truist issued its first Social Bond Impact Report, which details
the investments made from the bond proceeds and underscores the Company's
commitment to advancing its ESG goals.
•In March 2022, Truist partnered with Connect Humanity to provide internet
connectivity to historically marginalized communities.

Governance

•Truist made several leadership changes during 2022 as we continued to execute
on the strategy first agreed upon in the Merger. Effective March 12, 2022,
William H. Rogers, Jr. was appointed chairman of the board and Thomas E. Skains
was appointed lead independent director. Rogers succeeds Kelly S. King, who
stepped down from the role of chairman as previously announced. Skains succeeds
David M. Ratcliffe. Both King and Ratcliffe remain on the board.
•In March 2022, Truist appointed Dontá L. Wilson to lead Retail and Small
Business Banking. In his new role, Wilson will oversee Truist's branches across
the Southeast, Mid-Atlantic, and Texas; ATMs; mortgage; card-based services;
retail payments; deposit and loan products; small business delivery; retail loan
approval channels; and brand, sports, performance, and digital marketing. Wilson
assumes these responsibilities from Brant J. Standridge, who left Truist to
pursue a new opportunity.
•In January 2022, Truist appointed Denise M. DeMaio as Chief Audit Officer,
effective February 28, 2022. Denise joined the Executive Leadership team,
leading Truist's internal audit function, and providing counsel to senior
management on emerging risk trends from the vantage points of governance,
processes, technologies and reporting.

Financial results

Net income available to common shareholders for the first quarter of 2022 of
$1.3 billion was relatively stable compared with the first quarter of 2021. On a
diluted per common share basis, earnings for the first quarter of 2022 were
$0.99, an increase of $0.01 compared to the first quarter of 2021. Truist's
results of operations for the first quarter of 2022 produced an annualized
return on average assets of 1.07% and an annualized return on average common
shareholders' equity of 9.0% compared to prior year returns of 1.17% and 8.7%,
respectively. Results for the first quarter of 2022 included merger-related and
restructuring charges of $216 million ($166 million after-tax), incremental
operating expenses related to the Merger of $202 million ($155 million
after-tax), a gain on the redemption of noncontrolling equity interest of $74
million ($57 million after-tax) related to the acquisition of certain merchant
services relationships, and net losses on the sales of securities of $69 million
($53 million after-tax). Results for the first quarter of 2021 included $141
million ($108 million after-tax) of merger-related and restructuring charges,
$175 million ($134 million after-tax) of incremental operating expenses related
to the Merger, and an acceleration of loss recognition related to certain
terminated cash flow hedges of $36 million ($28 million after-tax).

On a TE basis, revenue was $5.4 billion for the first quarter of 2022, a
decrease of $159 million, or 2.9%, compared to the same period in 2021. TE net
interest income for the first quarter of 2022 was down $104 million, or 3.1%,
compared to the earlier quarter due to lower purchase accounting accretion,
lower PPP fees, and a decrease in loan balances. These decreases were partially
offset by growth in the securities portfolio and lower funding costs. Average
earning assets increased $26.0 billion, or 5.9%, compared to the earlier
quarter. The increase in average earning assets reflects a $30.4 billion, or
25%, increase in average securities, a $1.5 billion, or 8.7%, increase in
average other earning assets, and a $1.1 billion, or 23%, increase in average
interest earning trading assets, while average total loans and leases decreased
$7.1 billion, or 2.4%. The growth in average earning assets is a result of the
deployment of strong deposit growth resulting from fiscal and monetary stimulus.
Average deposits increased $32.1 billion, or 8.4%, compared to the earlier
quarter, while average long-term debt decreased $2.5 billion, or 6.6%.

Net interest margin was 2.76%, down 25 basis points compared to the earlier
quarter. The yield on the total loan portfolio for the first quarter of 2022 was
3.69%, down 40 basis points compared to the earlier quarter, reflecting the
impact of lower purchase accounting accretion, lower PPP fees, and the ongoing
impact of the lower rate environment. The yield on the average securities
portfolio was 1.68%, up 23 basis points compared to the earlier quarter
primarily due to higher yields on new purchases and lower premium amortization.

38 Truist Financial Corporation
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The provision for credit losses was a benefit of $95 million, compared to a cost
of $48 million for the earlier quarter. The current quarter includes a reserve
release due to the continued favorable credit environment. Net charge-offs for
the first quarter of 2022 totaled $178 million compared to $238 million in the
earlier quarter. The net charge-off ratio for the current quarter of 0.25% was
down eight basis points compared to the earlier quarter.

Noninterest income for the first quarter of 2022 decreased $55 million, or 2.5%,
compared to the earlier quarter. The first quarter of 2022 includes net
securities losses of $69 million and the gain on the redemption of
noncontrolling equity interest (other income) of $74 million. The earlier
quarter included a gain of $37 million from the divestiture of certain
businesses (other income). Excluding the aforementioned items, noninterest
income was down $23 million, or 1.1%. Insurance income increased $101 million,
or 16%, due to continued organic growth and acquisitions. Investment banking and
trading income decreased $85 million, or 25%, due to lower high yield bond and
equity originations fees, lower core trading income, and lower CVA gains,
partially offset by higher structured real estate fees. Residential mortgage
income decreased $11 million, or 11%, as lower production income (due to margins
and refinance volumes) was largely offset by higher servicing income (due to
lower prepayments). Excluding the gain on the redemption of noncontrolling
equity interest, the gain in the earlier quarter from the divestiture of certain
businesses and a $67 million decrease for assets held for certain
post-retirement benefits, which is primarily offset by lower personnel expense,
other income increased $56 million, due to higher investment income from the
Company's SBIC and other investments.

Noninterest expense for the first quarter of 2022 was up $64 million, or 1.8%,
compared to the earlier quarter. Merger-related and restructuring charges
increased $75 million due to costs for client day one conversions. Incremental
operating expenses related to the Merger increased $27 million, primarily
reflected in net occupancy expense in connection with updating the branch
network to incorporate the Truist brand. The prior quarter also includes $36
million of expense associated with an acceleration of loss recognition related
to certain terminated cash flow hedges and a small gain on the extinguishment of
debt. Excluding the aforementioned items and the amortization of intangibles,
adjusted noninterest expense was relatively stable compared to the earlier
quarter. Personnel expense decreased $91 million, or 4.2%, due to lower other
employee benefits as a result of the decrease in noninterest income for
post-retirement benefits, lower incentives (due to declines in noninterest
income), and lower salaries driven by fewer FTEs. Additionally, other expense
increased $29 million due to increased operational losses, software expense
increased $22 million, and marketing and customer development expense increased
$18 million due to increased branding efforts.

The provision for income taxes was $330 million for the first quarter of 2022,
compared to $351 million for the earlier quarter. The effective tax rate for the
first quarter of 2022 was 18.9%, compared to 19.2% for the earlier quarter,
primarily due to discrete tax expenses resulting from the divestiture of certain
businesses in the prior year.

Truist's total assets at March 31, 2022 were $544.0 billion, an increase of $2.7
billion, or 0.5%, compared to December 31, 2021. Total deposits at March 31,
2022 were $428.3 billion, an increase of $11.8 billion, or 2.8%, compared to
December 31, 2021. In April 2022, Truist redeemed $800 million notional of FHLB
advances, which resulted in a gain on early extinguishment of long-term debt of
$39 million.

Transferred Truist $59.4 billion of AFS securities to HTM as the Company continues to implement its asset-liability management strategies.

Asset quality remains excellent, reflecting Truist’s cautious risk culture, diversified portfolio and continued favorable credit environment.

Truist maintained strong capital and liquidity. As of March 31, 2022, the CET1
ratio was 9.4% and the average LCR was 111%. The 20 basis point decline compared
to the fourth quarter 2021 CET1 ratio reflects capital deployed through the
acquisition of Kensington Vanguard National Land Services, the acquisition of
certain merchant services relationships, an increase in risk-weighted assets,
and the impact from the phase-in of the CECL transition relief. Additionally,
the Company had $1.7 billion of senior long-term debt maturities and
redemptions. Truist declared common dividends of $0.48 per share in the first
quarter of 2022, resulting in dividend and total payout ratios of 48%.
                                                 Truist Financial Corporation 39
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Analysis of operating results

Net interest income and NIM

First quarter 2022 compared to first quarter 2021

Net interest income for the first quarter of 2022 was down $104 million, or
3.1%, compared to the earlier quarter due to lower purchase accounting
accretion, lower PPP fees, and a decrease in loan balances. These decreases were
partially offset by growth in the securities portfolio and lower funding costs.
Average earning assets increased $26.0 billion, or 5.9%, compared to the earlier
quarter. The increase in average earning assets reflects a $30.4 billion, or
25%, increase in average securities, a $1.5 billion, or 8.7%, increase in
average other earning assets, and a $1.1 billion, or 23%, increase in average
interest earning trading assets, while average total loans and leases decreased
$7.1 billion, or 2.4%. The growth in average earning assets is a result of the
deployment of strong deposit growth resulting from fiscal and monetary stimulus.
Average deposits increased $32.1 billion, or 8.4%, compared to the earlier
quarter, while average long-term debt decreased $2.5 billion, or 6.6%.

Net interest margin was 2.76%, down 25 basis points compared to the earlier
quarter. The yield on the total loan portfolio for the first quarter of 2022 was
3.69%, down 40 basis points compared to the earlier quarter, reflecting the
impact of lower purchase accounting accretion, lower PPP fees, and the ongoing
impact of the lower rate environment. The yield on the average securities
portfolio was 1.68%, up 23 basis points compared to the earlier quarter
primarily due to higher yields on new purchases and lower premium amortization.

The average cost of total deposits was 0.03%, down two basis points compared to
the earlier quarter. The average cost of short-term borrowings was 0.60%, down
22 basis points compared to the earlier quarter. The average cost of long-term
debt was 1.50%, down seven basis points compared to the earlier quarter. The
lower rates on interest-bearing liabilities reflect the impact of repricing of
liabilities at lower rates.

As of March 31, 2022, the remaining unamortized fair value marks on the loan and
lease portfolio, deposits, and long-term debt were $1.1 billion, $5 million, and
$122 million, respectively. As of December 31, 2021, the remaining unamortized
fair value marks on the loan and lease portfolio, deposits and long-term debt
were $1.3 billion, $7 million, and $139 million, respectively.

The remaining unamortized fair value mark on loans and leases consist of $624
million for consumer loans and leases, and $495 million for commercial loans and
leases. These amounts will be recognized over the remaining contractual lives of
the underlying instruments or as paydowns occur.

The major components of net interest income and the related annualized yields as
well as the variances between the periods caused by changes in interest rates
versus changes in volumes are summarized below.
40 Truist Financial Corporation
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Table 1: Net interest income in taxable equivalent and rate/volume analysis (1)

Three Months Ended March 31,                              Average Balances (5)                  Annualized Yield/Rate                  Income/Expense                Incr.                  Change due to
(Dollars in millions)                                    2022                2021               2022               2021             2022             2021           (Decr.)             Rate             Volume
Assets
Total securities, at amortized cost: (2)
U.S. Treasury                                       $     9,890          $   1,759                0.72  %          0.89  %       $    18          $     4          $    14          $      (1)         $    15
GSE                                                       1,120              1,839                2.13             2.33                6               11               (5)                (1)              (4)
Agency MBS                                              137,052            118,171                1.72             1.44              590              426              164                 90               74
States and political subdivisions                           374                444                3.72             3.52                3                4               (1)                 -               (1)
Non-agency MBS                                            4,224                  -                2.25                -               24                -               24                  -               24
Other                                                        27                 33                2.04             1.92                -                -                -                  -                -

Total securities                                        152,687            122,246                1.68             1.45              641              445              196                 88              108
Interest earning trading assets                           5,837              4,742                3.04             2.79               43               32               11                  3                8
Other earning assets (3)                                 18,932             17,417                0.63             0.37               30               16               14                 13                1

Loans and leases, net of deferred income: (4)

Commercial and industrial                               138,872            141,026                2.88             3.14              987            1,093             (106)               (90)             (16)
CRE                                                      23,555             26,211                2.84             2.90              168              189              (21)                (4)             (17)
Commercial Construction                                   5,046              6,557                3.05             3.04               35               48              (13)                 -              (13)

Residential mortgage                                     47,976             45,823                3.57             4.42              428              507              (79)              (102)              23
Residential home equity and direct                       24,883             25,658                5.38             5.81              330              368              (38)               (27)             (11)
Indirect auto                                            26,088             26,363                5.56             6.56              357              426              (69)               (65)              (4)
Indirect other                                           10,860             10,848                6.32             6.98              169              187              (18)               (18)               -
Student                                                   6,648              7,519                3.86             3.96               63               73              (10)                (2)              (8)
Credit card                                               4,682              4,645                8.97             9.24              104              106               (2)                (3)               1

Total loans and leases HFI                              288,610            294,650                3.70             4.11            2,641            2,997             (356)              (311)             (45)
LHFS                                                      3,874              4,891                2.87             2.59               28               32               (4)                 3               (7)
Total loans and leases                                  292,484            299,541                3.69             4.09            2,669            3,029             (360)              (308)             (52)
Total earning assets                                    469,940            443,946                2.90             3.20            3,383            3,522             (139)              (204)              65
Nonearning assets                                        66,041             64,887
Total assets                                        $   535,981          $ 508,833
Liabilities and Shareholders' Equity
Interest-bearing deposits:
Interest-checking                                   $   112,159          $ 104,744                0.05             0.06               14               15               (1)                (2)               1
Money market and savings                                141,500            129,303                0.03             0.03               11               10                1                  -                1
Time deposits                                            15,646             20,559                0.18             0.44                7               22              (15)               (11)              (4)

Total interest-bearing deposits (6)                     269,305            254,606                0.05             0.07               32               47              (15)               (13)              (2)
Short-term borrowings                                     6,944              6,731                0.60             0.82               10               14               (4)                (4)               -
Long-term debt                                           35,337             37,820                1.50             1.57              132              148              (16)                (6)             (10)
Total interest-bearing liabilities                      311,586            299,157                0.22             0.28              174              209              (35)               (23)             (12)
Noninterest-bearing deposits (6)                        145,933            128,579
Other liabilities                                        11,664             11,050
Shareholders' equity                                     66,798             70,047

Total liabilities and equity $535,981 $508,833
Average interest rate spread

                                                                      2.68  %          2.92  %
NIM/net interest income - taxable equivalent                                                      2.76  %          3.01  %       $ 3,209          $ 

3,313 $ (104) $ (181) $77
Taxable Equivalent Adjustment

                                                                                                    $    26          $    

28


(1) Yields are stated on a TE basis utilizing federal tax rate. The change in
interest not solely due to changes in rate or volume has been allocated based on
the pro-rata absolute dollar amount of each. Interest income includes certain
fees, deferred costs, and dividends.
(2) Total securities include AFS and HTM securities.
(3) Includes cash equivalents, interest-bearing deposits with banks, FHLB stock
and other earning assets.
(4) Fees, which are not material for any of the periods shown, are included for
rate calculation purposes. NPLs are included in the average balances.
(5) Represents daily average balances. Excludes basis adjustments for fair value
hedges.
(6) Total deposit costs were 0.03% and 0.05% for the three months ended March
31, 2022 and 2021, respectively.
                                                 Truist Financial Corporation 41
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Provision for credit losses

First quarter 2022 compared to first quarter 2021

The provision for credit losses was a benefit of $95 million, compared to a cost
of $48 million for the earlier quarter. The current quarter includes a reserve
release due to the continued favorable credit environment. Net charge-offs for
the first quarter of 2022 totaled $178 million compared to $238 million in the
earlier quarter. The net charge-off ratio for the current quarter of 0.25% was
down eight basis points compared to the earlier quarter.

Non-interest income

Noninterest income is a significant contributor to Truist's financial results.
Management focuses on diversifying its sources of revenue to reduce Truist's
reliance on traditional spread-based interest income, as certain fee-based
activities are a relatively stable revenue source during periods of changing
interest rates.
Table 2: Noninterest Income
                                                                            

Three months completed March, 31st,

(Dollars in millions)                                                                                         2022             2021                   % Change

Insurance income                                                                                           $   727          $   626                        16.1  %
Investment banking and trading income                                                                          261              346                       (24.6)
Wealth management income                                                                                       343              341                         0.6
Service charges on deposits                                                                                    252              258                        (2.3)
Card and payment related fees                                                                                  212              200                     

6.0

Residential mortgage income                                                                                     89              100                       (11.0)
Lending related fees                                                                                            85              100                       (15.0)
Operating lease income                                                                                          58               68                       (14.7)
Commercial mortgage income                                                                                      32               33                     

(3.0)

Income from bank-owned life insurance                                                                           51               50                         2.0
Securities gains (losses)                                                                                      (69)               -                             NM
Other income                                                                                                   101               75                        34.7
Total noninterest income                                                                                   $ 2,142          $ 2,197                        (2.5)


First quarter 2022 compared to first quarter 2021

Noninterest income for the first quarter of 2022 decreased $55 million, or 2.5%,
compared to the earlier quarter. The first quarter of 2022 includes net
securities losses of $69 million and the gain on the redemption of
noncontrolling equity interest (other income) of $74 million. The earlier
quarter included a gain of $37 million from the divestiture of certain
businesses (other income). Excluding the aforementioned items, noninterest
income was down $23 million, or 1.1%. Insurance income increased $101 million,
or 16%, due to continued organic growth and acquisitions. Investment banking and
trading income decreased $85 million, or 25%, due to lower high yield bond and
equity originations fees, lower core trading income, and lower CVA gains,
partially offset by higher structured real estate fees. Residential mortgage
income decreased $11 million, or 11%, as lower production income (due to lower
margins and refinance volumes) was largely offset by higher servicing income
(due to lower prepayments). Excluding the gain on the redemption of
noncontrolling equity interest, the gain in the earlier quarter from the
divestiture of certain businesses and a $67 million decrease for assets held for
certain post-retirement benefits, which is primarily offset by lower personnel
expense, other income increased $56 million, due to higher investment income
from the Company's SBIC and other investments.

42 Truist Financial Corporation
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Non-interest expenses

The following table provides a breakdown of Truist’s non-interest expenses: Table 3: Non-interest expenses

Three months completed March, 31st,

(Dollars in millions)                                                                                          2022             2021                   % Change

Personnel expense                                                                                           $ 2,051          $ 2,142                        (4.2) %
Professional fees and outside processing                                                                        363              350                         3.7
Software expense                                                                                                232              210                        10.5
Net occupancy expense                                                                                           208              209                        (0.5)
Amortization of intangibles                                                                                     137              144                        (4.9)
Equipment expense                                                                                               118              113                         4.4
Marketing and customer development                                                                               84               66                        27.3
Operating lease depreciation                                                                                     48               50                        (4.0)
Loan-related expense                                                                                             44               54                       (18.5)
Regulatory costs                                                                                                 35               25                        40.0
Merger-related and restructuring charges                                                                        216              141                    

53.2

Loss (gain) on early extinguishment of debt                                                                       -               (3)                     (100.0)

Other expense                                                                                                   138              109                        26.6
Total noninterest expense                                                                                   $ 3,674          $ 3,610                         1.8


First quarter 2022 compared to first quarter 2021

Noninterest expense for the first quarter of 2022 was up $64 million, or 1.8%,
compared to the earlier quarter. Merger-related and restructuring charges
increased $75 million due to costs for client day one conversions. Incremental
operating expenses related to the merger increased $27 million, primarily
reflected in net occupancy expense in connection with updating the branch
network to incorporate the Truist brand. The prior quarter also includes $36
million of expense associated with an acceleration of loss recognition related
to certain terminated cash flow hedges and a small gain on the extinguishment of
debt. Excluding the aforementioned items and the amortization of intangibles,
adjusted noninterest expense was relatively stable compared to the earlier
quarter. Personnel expense decreased $91 million, or 4.2%, due to lower other
employee benefits as a result of the decrease in noninterest income for
post-retirement benefits, lower incentives (due to declines in noninterest
income), and lower salaries driven by fewer FTEs. Additionally, other expense
increased $29 million due to increased operational losses, software expense
increased $22 million, and marketing and customer development expense increased
$18 million due to increased branding efforts.

Merger and restructuring charges

The following table presents a summary of the charges related to the merger and restructuring and the related accrued liabilities. 2022 and 2021 merger and restructuring costs primarily reflect charges resulting from the merger, including severance and other benefit costs, facility exit costs and other restructuring initiatives . Table 4: Merger and restructuring adjustment activity

                                                                                                  Three Months Ended March
                                                                                                          31, 2022

                                                                                                                                              Accrual at Jan                                            Accrual at Mar
(Dollars in millions)                                                                                                                            1, 2022             Expense           Utilized            31, 2022
Severance and personnel-related                                                                                                               $        77          $     37          $     (72)         $         42
Occupancy and equipment                                                                                                                                 -                98                (98)                    -
Professional services                                                                                                                                  37                64                (64)                   37
Systems conversion and related costs                                                                                                                    -                20                (17)                    3
Other                                                                                                                                                  12                (3)                (2)                    7
Total (1)                                                                                                                                     $       126          $    216          $    (253)         $         89


(1)Related to the Merger, the Company recognized $208 million for the three
months ended March 31, 2022. At March 31, 2022, the Company had an accrual of
$81 million related to the Merger. The remaining expense and accrual relate to
other restructuring activities.

                                                 Truist Financial Corporation 43
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Sector results

Truist operates and measures business activity across three segments: Consumer
Banking and Wealth, Corporate and Commercial Banking, and Insurance Holdings,
with functional activities included in Other, Treasury, and Corporate. The
Company's business segment structure is based on the manner in which financial
information is evaluated by management as well as the products and services
provided or the type of client served. See "Note 18. Operating Segments" herein
and "Note 21. Operating Segments" in Truist's Annual Report on Form 10-K for the
year ended December 31, 2021 for additional disclosures related to Truist's
reportable business segments, including additional details related to results of
operations. Fluctuations in noninterest income and noninterest expense are more
fully discussed in the Noninterest Income and Noninterest Expense sections
above.
Table 5: Net Income by Reportable Segment

                                                                                Three Months Ended
                                                                                     March 31,
(Dollars in millions)                                                                                       2022             2021                   % Change
Consumer Banking and Wealth                                                                              $   864          $   681                        26.9  %
Corporate and Commercial Banking                                                                             985              966                         2.0
Insurance Holdings                                                                                           152              133                        14.3
Other, Treasury & Corporate                                                                                 (585)            (307)                      

(90.6)

Truist Financial Corporation                                                                             $ 1,416          $ 1,473                        (3.9)


First quarter 2022 compared to first quarter 2021

Consumer banking and wealth management

CB&W net income was $864 million for the first quarter of 2022, an increase of
$183 million compared to the earlier quarter. Segment net interest income
increased $194 million primarily driven by higher interest rates, favorable
funding credit on deposits, and increased deposit balances, partially offset by
lower purchase accounting accretion. The allocated provision for credit losses
decreased $26 million reflecting the impact of a larger allowance release than
the earlier quarter as well as lower charge offs. Noninterest income increased
$30 million compared to the earlier quarter primarily due to the gain on the
redemption of noncontrolling equity interest in the current quarter as well as
an increase in card and payment fees driven by increased sales volume, partially
offset by a gain from the divestiture of certain businesses in the earlier
quarter and lower residential mortgage income. Noninterest expense was flat
compared to the earlier quarter.

CB&W average loans and leases held for investment decreased $1.8 billion, or
1.4%, for the first quarter of 2022 compared to the earlier quarter, primarily
driven by lower mortgage warehouse balances, home equity and other direct
consumer lending as well as lower student lending along with lower partnership
balances net of Service Finance balances resulting from acquisition, partially
offset by increased residential mortgage balances and recreational lending.
Average mortgage warehouse loans, home equity and other direct consumer loans,
student lending balances, and partnership balances net of Service Finance
balances resulting from acquisition declined $2.7 billion, or 51%, $947 million,
or 5.2%, $871 million, or 12%, and $211 million, or 6.0%, respectively, while
residential mortgage and recreational lending balances increased $2.1 billion,
or 4.7%, and $193 million, or 6.6%, respectively.

Average total deposits increased $22.6 billion, or 9.8%, for the first quarter
of 2022 compared to the earlier quarter, primarily driven by the impact of
fiscal and monetary stimulus. Average money market and savings accounts,
interest checking accounts, and noninterest-bearing deposits increased $10.1
billion, or 10%, $8.5 billion, or 17%, and $8.3 billion, or 13%, respectively,
partially offset by a decline in time deposits of $4.3 billion, or 23%.

Corporate and Business Banking

C&CB net income was $985 million for the first quarter of 2022, an increase of
$19 million compared to the earlier quarter. Segment net interest income
decreased $31 million primarily due to lower fee income associated with PPP loan
forgiveness and lower purchase accounting accretion, partially offset by higher
funding credit on deposits and increases to noninterest-bearing deposit
balances. The allocated provision for credit losses decreased $115 million
primarily reflecting a reserve release due to continued favorable credit
environment and lower charge offs in the current quarter. Noninterest income
decreased $73 million compared to the earlier quarter due to lower high yield
bond and equity originations fees, lower credit trading income, and lower CVA
mark to market gains, partially offset by higher structured real estate fees as
well as higher investment income from the Company's SBIC and other investments.
Noninterest expense decreased $18 million driven by lower professional fees and
intangible amortization expense in the current quarter.

C&CB average loans held for investment decreased $3.7 billion, or 2.4%, for the
first quarter of 2022 compared to the earlier quarter, primarily due to PPP loan
forgiveness. Excluding PPP loans, Corporate and Commercial Banking average loans
held for investment increased $4.6 billion, or 3.1%.

44 Truist Financial Corporation
--------------------------------------------------------------------------------

Average total deposits increased $7.8 billion, or 5.4%, for the first quarter of
2022 compared to the earlier quarter, primarily due to the impact of fiscal and
monetary stimulus. Average noninterest-bearing deposits increased $9.0 billion,
or 14%, while interest bearing deposits decreased $1.2 billion, or 1.5%.

Insurance assets

IH net income was $152 million for the first quarter of 2022, an increase of $19
million compared to the earlier quarter. Noninterest income increased $104
million primarily due to continued organic growth and acquisitions. Noninterest
expense increased $80 million primarily due to higher performance-based
incentives and salaries.

Other, Treasury & Business

OT&C generated a net loss of $585 million in the first quarter of 2022, compared
to a net loss of $307 million in the earlier quarter. Net interest income
decreased $265 million primarily due to higher funding credit on deposits to
other segments, partially offset by higher earnings in the securities portfolio
from higher yields on new purchases and lower premium amortization. The
allocated provision for credit losses was flat compared to the earlier quarter.
Noninterest income decreased $116 million primarily due to securities losses in
the current quarter and valuation changes from assets held for certain
post-retirement benefits, which is primarily offset by lower personnel expense.
Noninterest expense was flat compared to the earlier quarter.

Analysis of the financial situation

Investing activities

The securities portfolio totaled $146.4 billion at March 31, 2022, compared to
$154.6 billion at December 31, 2021. The decrease was due primarily to declines
in residential agency MBS and GSE securities as a result of prepayment activity.
In the first quarter of 2022, Truist transferred $59.4 billion of AFS securities
to HTM as the Company continues to execute upon its asset-liability management
strategies.

As of March 31, 2022, approximately 5.6% of the securities portfolio was
variable rate, excluding the impact of swaps, compared to 4.6% as of
December 31, 2021. The effective duration of the securities portfolio was 6.9
years at March 31, 2022, compared to 5.8 years at December 31, 2021, excluding
the impact of unsettled security purchases at period end.

U.S. Treasury, GSE, and Agency MBS represents 97% of the total securities
portfolio as of March 31, 2022 and December 31, 2021. While the overwhelming
majority of the portfolio remains in agency MBS securities, the Company also
holds AAA rated non-agency MBS as the risk adjusted returns for these securities
are more attractive than agency MBS.

Lending activities

The following table presents the composition of average loans and leases:
Table 6: Average Loans and Leases
For the Three Months Ended
(Dollars in millions)                          Mar 31, 2022           Dec 31, 2021           Sep 30, 2021           Jun 30, 2021           Mar 31, 

2021

Commercial:

Commercial and industrial                    $     138,872          $     

134,804 $134,942 $138,539 $141,026
CRE

                                                 23,555                 24,396                 24,849                 25,645                 26,211
Commercial construction                              5,046                  5,341                  5,969                  6,359                  6,557

Consumer:
Residential mortgage                                47,976                 47,185                 45,369                 43,605                 45,823
Residential home equity and direct                  24,883                 25,146                 25,242                 25,238                 25,658
Indirect auto                                       26,088                 26,841                 26,830                 26,444                 26,363
Indirect other                                      10,860                 10,978                 11,112                 10,797                 10,848
Student                                              6,648                  6,884                  7,214                  7,396                  7,519
Credit card                                          4,682                  4,769                  4,632                  4,552                  4,645

Total average loans and leases HFI           $     288,610          $     286,344          $     286,159          $     288,575          $     294,650



Average loans and leases held for investment for the first quarter of 2022 were
$288.6 billion, up $2.3 billion, or 0.8%, compared to the fourth quarter of
2021. Excluding a $1.1 billion decrease in average PPP loans, average loans held
for investment were up $3.3 billion, or 1.2%.

                                                 Truist Financial Corporation 45
--------------------------------------------------------------------------------

Average commercial loans increased $2.9 billion, or 1.8%, as a result of $6.5
billion, or 5.1%, growth within the commercial and industrial portfolio,
excluding PPP and mortgage warehouse lending. This growth was partially offset
by a $1.4 billion decrease in mortgage warehouse lending (commercial and
industrial), a $1.1 billion decrease in average PPP loans (commercial and
industrial), an $841 million decrease in average CRE loans, and a $295 million
decrease in average commercial construction loans.

Average consumer loans decreased $579 million, or 0.5% due to a $753 million
decrease in indirect auto due to market dynamics and the competitive
environment, a $263 million decrease in residential home equity and direct, and
a $236 million decrease in student loans. The decreases were partially offset by
a $791 million increase in residential mortgages due to the continued strategy
to put certain correspondent channel production onto the balance sheet and lower
prepayments.

At March 31, 2022 and December 31, 2021, 52% of loans and leases HFI were
variable rate.
46 Truist Financial Corporation
--------------------------------------------------------------------------------

Asset quality

The following tables summarize the asset quality information: Table 7: Asset Quality

(Dollars in millions)                          Mar 31, 2022           Dec 31, 2021           Sep 30, 2021           Jun 30, 2021           Mar 31, 2021
NPAs:
NPLs:
Commercial and industrial                    $         330          $         394          $         423          $         402          $         474
CRE                                                     27                     29                     20                     25                     58
Commercial construction                                  -                      7                      7                     12                     13

Residential mortgage                                   315                    296                    306                    302                    290
Residential home equity and direct                     141                    141                    146                    165                    172
Indirect auto                                          227                    218                    172                    148                    158
Indirect other                                           4                      5                      6                      6                      6

Total NPLs HFI                                       1,044                  1,090                  1,080                  1,060                  1,171
Loans held for sale                                     39                     22                     76                     78                     72
Total nonaccrual loans and leases                    1,083                  1,112                  1,156                  1,138                  1,243
Foreclosed real estate                                   3                      8                      9                     13                     18
Other foreclosed property                               49                     43                     39                     41                     38
Total nonperforming assets                   $       1,135          $       1,163          $       1,204          $       1,192          $       1,299
TDRs:
Performing TDRs:
Commercial and industrial                    $         104          $         147          $         200          $         202          $         201
CRE                                                      5                      5                      8                     24                     47
Commercial construction                                  1                      -                      -                      -                      -

Residential mortgage - government guaranteed           622                    480                    507                    520                    535
Residential mortgage - nonguaranteed                   244                    212                    205                    207                    198
Residential home equity and direct                      91                     98                    105                    107                    109
Indirect auto                                          392                    389                    390                    389                    399
Indirect other                                           6                      7                      7                      7                      7

Student - nonguaranteed                                 25                     25                     23                     13                      8
Credit card                                             25                     27                     30                     32                     35
Total performing TDRs                                1,515                  1,390                  1,475                  1,501                  1,539
Nonperforming TDRs                                     189                    152                    159                    190                    207
Total TDRs                                   $       1,704          $       1,542          $       1,634          $       1,691          $       1,746
Loans 90 days or more past due and still
accruing:
Commercial and industrial                    $          22          $       

$13 $18 $14 14

Residential mortgage - government guaranteed           996                    978                    823                    929                    935
Residential mortgage - nonguaranteed                    31                     31                     29                     47                     40
Residential home equity and direct                      12                      9                      7                      7                     11
Indirect auto                                            1                      1                      2                      2                      2
Indirect other                                           2                      3                      2                      1                      1
Student - government guaranteed                        818                    864                    965                  1,043                  1,033
Student - nonguaranteed                                  4                      4                      3                      3                      4
Credit card                                             28                     27                     23                     22                     32

Total loans 90 days or more past due and     $       1,914          $       1,930          $       1,872          $       2,068          $       2,072
still accruing
Loans 30-89 days past due and still
accruing:
Commercial and industrial                    $         280          $         130          $         135          $         146          $         152
CRE                                                     13                     20                      4                      7                      9
Commercial construction                                  1                      2                      2                      1                      4

Residential mortgage - government guaranteed           216                    256                    264                    307                    330
Residential mortgage - nonguaranteed                   326                    258                    231                    236                    247
Residential home equity and direct                     142                    107                     81                     73                     82
Indirect auto                                          529                    607                    560                    428                    328
Indirect other                                          65                     64                     53                     47                     45
Student - government guaranteed                        476                    549                    451                    543                    551
Student - nonguaranteed                                  6                      6                      5                      5                      5
Credit card                                             47                     45                     37                     31                     35

Total loans 30-89 days past due and still    $       2,101          $       2,044          $       1,823          $       1,824          $       1,788
accruing



                                                 Truist Financial Corporation 47
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Nonperforming assets totaled $1.1 billion at March 31, 2022, down $28 million
compared to December 31, 2021 due to declines in the commercial and industrial
portfolio. Nonperforming loans and leases held for investment were 0.36% of
loans and leases held for investment at March 31, 2022, down two basis points
compared to December 31, 2021.

Performing RDTs increased $125 million quarter-over-quarter primarily due to an increase in government-backed residential mortgages.

Loans 90 days or more past due and still accruing totaled $1.9 billion at
March 31, 2022, down $16 million compared to the prior quarter. The ratio of
loans 90 days or more past due and still accruing as a percentage of loans and
leases was 0.66% at March 31, 2022, down one basis point from the prior quarter.
Excluding government guaranteed loans, the ratio of loans 90 days or more past
due and still accruing as a percentage of loans and leases was 0.04% at
March 31, 2022, up one basis point from December 31, 2021.

Loans 30-89 days past due and still accruing of $2.1 billion at March 31, 2022
were up one basis point compared to the prior quarter due to an increase in the
commercial and industrial portfolio, partially offset by seasonal declines in
the indirect auto portfolio and a decline in the student portfolio.

Problem loans include NPLs and loans that are 90 days or more past due and still
accruing as disclosed in Table 7. In addition, for the commercial portfolio
segment, loans that are rated special mention or substandard performing are
closely monitored by management as potential problem loans. Refer to "Note 5.
Loans and ACL" for additional disclosures related to these potential problem
loans.
Table 8: Asset Quality Ratios

                                                                           Mar 31, 2022         Dec 31, 2021
Loans 30-89 days past due and still accruing as a percentage of loans and        0.72  %              0.71  %
leases HFI
Loans 90 days or more past due and still accruing as a percentage of             0.66                 0.67
loans and leases HFI
NPLs as a percentage of loans and leases HFI                                     0.36                 0.38
NPLs as a percentage of total loans and leases (1)                               0.37                 0.38
NPAs as a percentage of:
Total assets (1)                                                                 0.21                 0.21
Loans and leases HFI plus foreclosed property                                    0.38                 0.39

ALLL as a percentage of loans and leases HFI                                     1.44                 1.53

Ratio of ALLL to NPLs                                                              3.99x                4.07x

Loans past due 90 days or more and still accrued as a percentage of

      0.04  %              0.03  %

HFI loans and leases, excluding PPPs and other public guarantees (2)


(1)Includes LHFS.
(2)This asset quality ratio has been adjusted to remove the impact of government
guaranteed mortgage, student, and PPP loans. Management believes the inclusion
of such assets in this asset quality ratio results in distortion of this ratio
because collection of principal and interest is reasonably assured or the ratio
might not be comparable to other periods presented or to other portfolios that
do not have government guarantees.

Table 9: Asset quality ratios (continued)

For the Three Months Ended                            Mar 31, 2022               Dec 31, 2021               Sep 30, 2021               Jun 30, 2021            Mar 31, 2021
Net charge-offs as a percentage of average loans and leases HFI:
Commercial:
Commercial and industrial                                      0.04  %                    0.09  %                    0.04  %                    0.09  %              0.17  %
CRE                                                            0.01                       0.07                          -                      (0.05)                0.04
Commercial construction                                       (0.02)                     (0.10)                     (0.06)                     (0.06)                0.08

Consumer:
Residential mortgage                                          (0.03)                     (0.02)                      0.04                      (0.01)                0.08
Residential home equity and direct                             0.61                       0.49                       0.49                       0.59                 0.58
Indirect auto                                                  1.23                       1.01                       0.75                       0.63                 1.28
Indirect other                                                 0.48                       0.39                       0.26                       0.17                 0.39
Student                                                        0.33                       0.65                       0.31                       0.16                 0.16
Credit card                                                    2.77                       2.31                       1.90                       2.75                 2.74
Total                                                          0.25                       0.25                       0.19                       0.20                 0.33

Ratio of ALLL to net charge-offs                                 5.78x                      6.14x                      8.79x                      8.98x                5.87x


Ratios are annualized, as applicable.
48 Truist Financial Corporation
--------------------------------------------------------------------------------

The following table presents activity related to CPAs: Table 10: Recovery of CPAs (in millions of dollars)

                     2022         2021
Balance, January 1                      $ 1,163      $ 1,387
New NPAs                                    395          563
Advances and principal increases            108          102

Disposals of seized assets (1) (112) (112) Disposals of NPL (2)

                       (37)         (41)
Charge-offs and losses                     (115)        (112)
Payments                                   (180)        (300)
Transfers to performing status             (101)        (183)
Other, net                                   14           (5)
Ending balance, March 31                $ 1,135      $ 1,299


(1)Includes allowances and losses recognized on disposal $29 million and $46 million for the three months ended March 31, 2022 and 2021, respectively. (2)Includes allowances and losses recognized on disposal $3 million and $5 million for the three months ended March 31, 2022 and 2021, respectively.

TDRs occur when a borrower is experiencing, or is expected to experience,
financial difficulties in the near term and a concession has been granted to the
borrower. As a result, Truist works with borrowers to prevent further
difficulties and to improve the likelihood of recovery on a loan. To facilitate
this process, a concessionary modification that would not otherwise be
considered may be granted, resulting in classification of the loan as a TDR. For
loan modification programs in response to the COVID-19 pandemic, Truist applied
the relief from TDR accounting described in the CARES Act. Payment relief
assistance provided by Truist includes forbearance, deferrals, extension, and
re-aging programs, along with certain other modification strategies. Refer to
"Note 1. Basis of Presentation" in Truist's Annual Report on Form 10-K for the
year ended December 31, 2021 for the policies related to TDRs and COVID-19 loan
modifications. The following table provides a summary of performing TDR
activity:
Table 11: Rollforward of Performing TDRs
(Dollars in millions)                      2022         2021
Balance, January 1                       $ 1,390      $ 1,361
Inflows                                      306          294
Payments and payoffs (1)                     (60)         (57)
Charge-offs                                   (9)         (13)

Transfers to non-performing RDTs (2) (19) (13) Withdrawal due to the passage of time

           (71)          (7)
Non-concessionary re-modifications            (1)         (12)

Transferred to LHFS, sold and other (21) (14) Balance, March, 31st

                        $ 1,515      $ 1,539


(1)Includes scheduled principal payments, prepayments, and payoffs of amounts
outstanding.
(2)Represent loans that no longer meet the requirements necessary to reflect the
loan in accruing status.

                                                 Truist Financial Corporation 49
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The following table provides further details regarding the payment status of
TDRs outstanding at March 31, 2022:
Table 12: Payment Status of TDRs (1)
March 31, 2022
(Dollars in millions)                        Current                       Past Due 30-89 Days                Past Due 90 Days Or More            Total
Performing TDRs:
Commercial:
Commercial and industrial          $   102              98.1  %       $       2               1.9  %       $       -                 -  %       $   104
CRE                                      5             100.0                  -                 -                  -                 -                5
Commercial construction                  1             100.0                  -                 -                  -                 -                1

Consumer:
Residential mortgage - government      290              46.6                 58               9.3                274              44.1              622
guaranteed
Residential mortgage -                 210              86.1                 25              10.2                  9               3.7              244
nonguaranteed
Residential home equity and direct      85              93.4                  6               6.6                  -                 -               91
Indirect auto                          336              85.7                 56              14.3                  -                 -              392
Indirect other                           5              83.3                  1              16.7                  -                 -                6

Student - nonguaranteed                 22              88.0                  2               8.0                  1               4.0               25
Credit card                             22              88.0                  2               8.0                  1               4.0               25
Total performing TDRs                1,078              71.2                152              10.0                285              18.8            1,515
Nonperforming TDRs                      57              30.2                 24              12.7                108              57.1              189
Total TDRs                         $ 1,135              66.6          $     176              10.3          $     393              23.1          $ 1,704

(1) Overdue performing TDRs are included in overdue information and non-performing TDRs are included in bad debt information. 50 Truist Financial Corporation
————————————————– ——————————

ACL

Activity related to the ACL is presented in the following tables:
Table 13: Activity in ACL
For the Three Months Ended
(Dollars in millions)                     Mar 31, 2022           Dec 31, 2021           Sep 30, 2021           Jun 30, 2021           Mar 31, 2021
Balance, beginning of period            $       4,695          $       4,978          $       5,436          $       6,011          $       6,199

Provision for credit losses                       (95)                  (103)                  (324)                  (434)                    48

Charge-offs:
Commercial and industrial                         (31)                   (54)                   (57)                   (53)                   (79)
CRE                                                (1)                    (5)                    (1)                     -                     (4)
Commercial construction                            (1)                     -                      -                      -                     (2)

Residential mortgage                               (2)                    (1)                    (7)                    (4)                   (11)
Residential home equity and direct                (58)                   (51)                   (51)                   (57)                   (55)
Indirect auto                                    (102)                   (89)                   (73)                   (69)                  (105)
Indirect other                                    (19)                   (16)                   (13)                   (11)                   (17)
Student                                            (6)                   (12)                    (6)                    (3)                    (3)
Credit card                                       (41)                   (37)                   (31)                   (42)                   (40)

Total charge-offs                                (261)                  (265)                  (239)                  (239)                  (316)
Recoveries:
Commercial and industrial                          17                     23                     42                     23                     19
CRE                                                 1                      -                      1                      4                      1
Commercial construction                             1                      1                      1                      1                      1

Residential mortgage                                6                      2                      3                      5                      2
Residential home equity and direct                 20                     21                     20                     20                     18
Indirect auto                                      23                     21                     22                     27                     22
Indirect other                                      6                      6                      5                      7                      6
Student                                             -                      -                      1                      -                      -
Credit card                                         9                      9                      9                     10                      9
Total recoveries                                   83                     83                    104                     97                     78
Net charge-offs                                  (178)                  (182)                  (135)                  (142)                  (238)
Other                                               1                      2                      1                      1                      2
Balance, end of period                  $       4,423          $       4,695          $       4,978          $       5,436          $       6,011

ACL:
ALLL                                    $       4,170          $       4,435          $       4,702          $       5,121          $       5,662
RUFC                                              253                    260                    276                    315                    349
Total ACL                               $       4,423          $       4,695          $       4,978          $       5,436          $       6,011


Net charges during the first quarter totaled $178 millionor 0.25% as a percentage of average loans, and is stable compared to the previous quarter.

The allowance for credit losses was $4.4 billion and includes $4.2 billion for
the allowance for loan and lease losses and $253 million for the reserve for
unfunded commitments. The ALLL ratio was 1.44% compared to 1.53% at December 31,
2021. The decrease reflects a continued favorable credit environment tempered by
uncertainty associated with inflation, supply chain disruption, rising rates,
and geopolitical events. The ALLL covered nonperforming loans and leases held
for investment 3.99X compared to 4.07X at December 31, 2021. At March 31, 2022,
the ALLL was 5.78X annualized net charge-offs, compared to 6.14X at December 31,
2021.

                                                 Truist Financial Corporation 51
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The following table presents an allocation of the ALLL. The entire amount of the
allowance is available to absorb losses occurring in any category of loans and
leases.
Table 14: Allocation of ALLL by Category
                                                       March 31, 2022                                                   December 31, 2021

                                                       % ALLL in Each        % Loans in Each                           % ALLL in Each        % Loans in Each
(Dollars in millions)               Amount                Category               Category             Amount              Category               Category
Commercial and industrial       $      1,319                   31.6  %                48.6  %       $  1,426                   32.2  %                47.9  %
CRE                                      283                    6.8                    7.9               350                    7.9                    8.3
Commercial construction                   53                    1.3                    1.8                52                    1.2                    1.7

Residential mortgage                     310                    7.4                   16.6               308                    6.9                   16.5
Residential home equity and              574                   13.8                    8.6               615                   13.9                    8.7
direct
Indirect auto                            957                   22.9                    8.9             1,022                   23.0                    9.1
Indirect other                           211                    5.1                    3.8               195                    4.4                    3.8
Student                                  115                    2.8                    2.2               117                    2.6                    2.3
Credit card                              348                    8.3                    1.6               350                    7.9                    1.7
Total ALLL                             4,170                  100.0  %               100.0  %          4,435                  100.0  %               100.0  %
RUFC                                     253                                                             260
Total ACL                       $      4,423                                                        $  4,695



Truist monitors the performance of its home equity loans and lines secured by
second liens similarly to other consumer loans and utilizes assumptions specific
to these loans in determining the necessary ALLL. Truist also receives
notification when the first lien holder, whether Truist or another financial
institution, has initiated foreclosure proceedings against the borrower. When
notified that the first lien is in the process of foreclosure, Truist obtains
valuations to determine if any additional charge-offs or reserves are warranted.
These valuations are updated at least annually thereafter.

Truist has limited ability to monitor the delinquency status of the first lien,
unless the first lien is held or serviced by Truist. Truist estimates second
lien loans where the first lien is delinquent based on historical experience;
the increased risk of loss on these credits is reflected in the ALLL. As of
March 31, 2022, Truist held or serviced the first lien on 32% of its second lien
positions.

Other Assets

The components of other assets are presented in the following table:
Table 15: Other Assets as of Period End
(Dollars in millions)                               Mar 31, 2022       Dec 31, 2021

Bank-owned life insurance                          $       7,545      $       7,281
Tax credit and other private equity investments            6,352              6,309
Prepaid pension assets                                     6,348              5,938
Derivative assets                                          2,113              2,370
Accounts receivable                                        2,323              2,244
Leased assets and related assets                           2,162              2,092
Accrued income                                             1,875              1,791
ROU assets                                                 1,126              1,168
Prepaid expenses                                           1,174              1,152
Equity securities at fair value                            1,024              1,066

Other                                                      1,428                738
Total other assets                                 $      33,470      $      32,149



Funding Activities

Deposits

The following table presents average deposits:
Table 16: Average Deposits
Three Months Ended
(Dollars in millions)                                      Mar 31, 2022           Dec 31, 2021           Sep 30, 2021           Jun 30, 2021           Mar 31, 2021
Noninterest-bearing deposits                             $     145,933          $     146,492          $     141,738          $     137,892          $     128,579
Interest checking                                              112,159                110,506                107,802                106,121                104,744
Money market and savings                                       141,500                137,676                136,094                134,029                129,303
Time deposits                                                   15,646                 16,292                 17,094                 18,213                 20,559

Total average deposits                                   $     415,238          $     410,966          $     402,728          $     396,255          $     383,185



52 Truist Financial Corporation
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Average deposits for the first quarter of 2022 were $415.2 billion, an increase
of $4.3 billion, or 1.0%, compared to the prior quarter. Average noninterest
bearing deposits declined 0.4% compared to the prior quarter and represented
35.1% of total deposits for the first quarter of 2022, compared to 35.6% for the
prior quarter. Average interest checking and money market and savings grew 1.5%
and 2.8%, respectively, compared to the prior quarter. Average time deposits
decreased 4.0% primarily due to the maturity of higher-cost accounts.

Loans

At March 31, 2022, short-term borrowings totaled $5.1 billion, a decrease of
$145 million compared to December 31, 2021. Average short-term borrowings were
$6.9 billion or 1.5% of total funding for the first quarter of 2022, as compared
to $6.7 billion or 1.6% for the prior year.

Long-term debt provides funding and, to a lesser extent, regulatory capital, and
primarily consists of senior and subordinated notes issued by Truist and Truist
Bank. Long-term debt totaled $33.8 billion at March 31, 2022, a decrease of $2.1
billion compared to December 31, 2021. During 2022, the Company had $1.4 billion
of senior and $300 million of subordinated long-term debt redemptions. FHLB
advances represented 2.5% of total outstanding long-term debt at March 31, 2022,
compared to 2.4% at December 31, 2021. The average cost of long-term debt was
1.50% for the three months ended March 31, 2022, down seven basis points
compared to the same period in 2021.

In April 2022, Truist redeemed $800 million of FHLB advances, which resulted in
a gain on early extinguishment of long-term debt of $39 million. Additionally,
Truist redeemed $1.4 billion of fixed rate senior notes and $650 million of
floating rate senior notes that were due in May 2022.

Equity

Total shareholders' equity was $65.0 billion at March 31, 2022, a decrease of
$4.2 billion from December 31, 2021. This decrease includes a decrease of $4.9
billion in AOCI, $725 million in dividends, partially offset by $1.4 billion in
net income. Truist's book value per common share at March 31, 2022 was $43.82,
compared to $47.14 at December 31, 2021.

Risk management

Truist maintains a comprehensive risk management framework supported by people,
processes, and systems to identify, measure, monitor, manage, and report
significant risks arising from its exposures and business activities. Effective
risk management involves optimizing risk and return while operating in a safe
and sound manner, and promoting compliance with applicable laws and regulations.
The Company's risk management framework promotes the execution of business
strategies and objectives in alignment with its risk appetite.

Truist has developed and employs a risk taxonomy that further guides business
functions in identifying, measuring, responding to, monitoring, and reporting on
possible exposures to the organization. The risk taxonomy drives internal risk
conversations and enables Truist to clearly and transparently communicate to
stakeholders the level of potential risk the Company faces, both presently and
in the future, and the Company's position on managing risk to acceptable levels.

Truist is committed to fostering a culture that supports risk identification and escalation across the organization. All teammates are responsible for upholding the company’s purpose, mission, and values ​​and are encouraged to speak up if any activity or behavior is inconsistent with the company’s culture. The Truist Code of Ethics guides company decision-making and instructs teammates on how to act in the absence of specific guidelines.

Truist seeks an appropriate return for the risk taken in its business operations. Risky activities are assessed and prioritized to identify those that offer attractive risk-adjusted returns, while preserving asset value and capital.

Compensation decisions take into account a teammate's adherence to and
successful implementation of Truist's risk values and associated policies and
procedures. The Company's compensation structure supports its core values and
sound risk management practices in an effort to promote judicious risk-taking
behavior.

Truist employs a comprehensive change management program to manage the residual
risks associated with integrating heritage BB&T and heritage SunTrust. While
integration activities are largely complete, the Board and Executive Leadership
oversee the change management program, which is designed to ensure appropriate
oversight of application and data center decommissioning and residual
integration activities, achieved through Truist's risk management process.

Refer to Truist’s annual report on Form 10-K for the fiscal year ended December 31, 2021 for additional information in the section titled “Risk Management”.

                                                 Truist Financial Corporation 53
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Market risk

Market risk is the risk to current or anticipated earnings, capital, or economic
value arising from changes in the market value of portfolios, securities, or
other financial instruments. Market risk results from changes in the level,
volatility, or correlations among financial market risk factors or prices,
including interest rates, credit spreads, foreign exchange rates, equity, and
commodity prices.

Effective management of market risk is essential to achieving Truist's strategic
financial objectives. Truist's most significant market risk exposure is to
interest rate risk in its balance sheet; however, market risk also results from
underlying product liquidity risk, price risk, and volatility risk in Truist's
business units. Interest rate risk results from differences between the timing
of rate changes and the timing of cash flows associated with assets and
liabilities (re-pricing risk); from changing rate relationships among different
yield curves affecting bank activities (basis risk); from changing rate
relationships across the spectrum of maturities (yield curve risk); and from
interest-related options inherently embedded in bank products (options risk).

The primary objectives of effective market risk management are to minimize
adverse effects from changes in market risk factors on net interest income, net
income, and capital, and to offset the risk of price changes for certain assets
and liabilities recorded at fair value. At Truist, market risk management also
includes the enterprise-wide IPV function.

Interest rate market risk

As a financial institution, Truist is exposed to interest rate risk from assets,
liabilities, and off-balance sheet positions. To keep net interest margin as
stable as possible, Truist actively manages its interest rate risk exposure
through the strategic repricing of its assets and liabilities, taking into
account the volumes, maturities, and mix. Truist primarily uses three methods to
measure and monitor its interest rate risk: (i) simulations of possible changes
to net interest income over the next two years based on gradual changes in
interest rates; (ii) analysis of interest rate shock scenarios; and (iii)
analysis of economic value of equity based on changes in interest rates.

The Company's simulation model takes into account assumptions related to
prepayment trends, using a combination of market data and internal historical
experiences for deposits and loans, as well as scheduled maturities and
payments, and the expected outlook for the economy and interest rates. These
assumptions are reviewed and adjusted monthly to reflect changes in current
interest rates compared to the rates applicable to Truist's assets and
liabilities. The model also considers Truist's current and prospective liquidity
position, current balance sheet volumes, projected growth and/or contractions,
accessibility of funds for short-term needs and capital maintenance.

Deposit betas (the sensitivity of deposit rate changes relative to market rate
changes) are an important assumption in the interest rate risk modeling process.
Truist applies deposit beta assumptions to non-maturity interest-bearing deposit
accounts that are not contractually tied to an index when determining its
interest rate sensitivity. Non-maturity, interest-bearing deposit accounts
include interest checking accounts, savings accounts, and money market accounts
that do not have a contractual maturity. Truist utilizes a tiered deposit beta
assumption framework that accounts for historically observed behaviors of
clients and the Company. The deposit beta assumptions are reduced when interest
rates are exceptionally low and competition for interest-bearing deposits is
commensurately low. As interest rates rise, the deposit beta assumptions also
rise to reflect increasing competition among banks as well as increased client
demand for interest-bearing deposits. Truist applies an average deposit beta of
approximately 25% for the first 100 basis point increase in the Federal funds
rate, approximately 35% for the second 100 basis point increase, and
approximately 50% for any additional increases. Truist also regularly conducts
sensitivity analyses on other key variables, including noninterest-bearing
deposits, to determine the impact these variables could have on the Company's
interest rate risk position. The predictive value of the simulation model
depends upon the accuracy of the assumptions, but management believes that it
provides helpful information for the management of interest rate risk.

The following table shows the effect that the indicated changes in interest rates would have on projected net interest income for the next 12 months assuming a gradual change in interest rates, as described below. Table 17: Interest rate sensitivity simulation analysis

                      Interest Rate Scenario                                                  Annualized Hypothetical Percentage Change in Net
 Gradual Change in                       Prime Rate                                                           Interest Income
 Prime Rate (bps)           Mar 31, 2022            Mar 31, 2021                                 Mar 31, 2022                 Mar 31, 2021
Up 100                              4.50  %                 4.25  %                                        4.27  %                       3.74  %
Up 50                               4.00                    3.75                                           3.29                          2.92
No Change                           3.50                    3.25                                              -                             -
Down 25 (1)                         3.25                    3.00                                          (2.48)                        (1.32)
Down 50 (1)                         3.00                    2.75                                          (3.46)                        (1.75)

(1) The Down 25 and 50 rates are floors at one basis point and may not reflect the Down 25 and 50 basis points for all interest rate indices.

Rate sensitivity increased compared to prior periods, primarily driven by a
change to the Company's deposit beta assumptions, partially offset by an
increase in the investment securities portfolio.
54 Truist Financial Corporation
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Management considers how the interest rate risk position could be impacted by
changes in balance sheet mix. Liquidity in the banking industry has been very
strong during the current economic cycle. Much of this liquidity increase has
resulted in growth in noninterest-bearing demand deposits. Consistent with the
industry, Truist has seen a significant increase in this funding source. The
behavior of these deposits is one of the most important assumptions used in
determining the interest rate risk position of Truist. A decrease in the amount
of these deposits in the future would reduce the asset sensitivity of Truist's
balance sheet because the Company may increase interest-bearing funds to offset
the loss of this advantageous funding source. Alternatively, the Company may
reduce the size of its investment portfolio to offset the loss of
noninterest-bearing demand deposits to limit the impact on the balance sheet's
asset sensitivity.

The following table presents the results of Truist’s interest rate sensitivity position assuming the loss of additional demand deposits and an associated increase in managed rate deposits relative to current projections under various interest rate scenarios. For the purposes of this analysis, Truist modeled the incremental beta of managed rate deposits for the replacement of demand deposits at 100%. Table 18: Sensitivity analysis of the mixture of deposits

                                                                                 Results Assuming a Decrease in Noninterest-Bearing Demand
  Gradual Change in                        Base Scenario at                                              Deposits
     Rates (bps)                          March 31, 2022 (1)                             $20 Billion                     $40 Billion
Up 100                                                4.27  %                                         3.45  %                      2.63  %
Up 50                                                 3.29                                            2.69                         2.10

(1) The base scenario is equal to the hypothetical annualized percentage change in net interest income at March 31, 2022 as shown in the previous table.

Truist uses financial instruments including derivatives to manage interest rate
risk related to securities, commercial loans, MSRs, and mortgage banking
operations, long-term debt, and other funding sources. Truist hedges a portion
of its AFS securities to reduce mark-to-market volatility within AOCI and also
to increase its overall asset sensitivity position. Truist has utilized
derivatives to facilitate transactions on behalf of its clients and as part of
associated hedging activities. As of March 31, 2022, Truist had derivative
financial instruments outstanding with notional amounts totaling $320.5 billion,
with an associated net fair value of $631 million. See "Note 16. Derivative
Financial Instruments" for additional disclosures.

LIBOR Transition

For most tenors of U.S. dollar LIBOR, the administrator of LIBOR extended
publication until June 30, 2023. Tenors used infrequently by Truist, including
one week and two month U.S. dollar LIBOR and all non-U.S. dollar LIBOR, ceased
publication at December 31, 2021, based on the October 20, 2021 interagency
Joint Statement on Managing the LIBOR transition. To prepare for the transition
to an alternative reference rate, management formed a cross-functional project
team to address the LIBOR transition. The project team performed an assessment
to identify the potential risks related to the transition from LIBOR to a new
index or multiple indices and provides updates to Executive Leadership and the
Board. As of March 31, 2022, Truist had outstanding LIBOR-based instruments that
mature after June 30, 2023, including: loan and lease exposures totaling
approximately $159 billion, notional derivative exposure totaling approximately
$135 billion, long-term debt of $1.1 billion, and preferred stock of $1.5
billion. These amounts are inclusive of remediated contracts, which contain
adequate fallback language for the transition.

Contract fallback language for existing loans and leases has largely been
reviewed and certain contracts will require amendments to support the transition
away from LIBOR. For impacted lines of business, the Company has started
remediating these contracts to include standardized fallback language. Current
fallback language used for new, renewed, and modified contracts is generally
consistent with ARRC recommendations and includes use of "hardwired fallback"
language, where appropriate.

The progress and approach to remediation will vary based on the type of contract
and existing language used in the agreement. For commercial lending and general
consumer lending, a significant number of remaining LIBOR contracts will require
client outreach and remediation. Efforts to amend and remediate contracts,
excluding mortgage and student loans, that mature post June 30, 2023 ($148
billion) will be accelerated in 2022. Truist has determined that adjustable rate
mortgage products ($4.0 billion) have consistent and adequate fallback language
to transition away from LIBOR in line with industry expectations; therefore,
these contracts will not require remediation. Remediation of student loans ($5.8
billion) will depend on guidance from the Department of Education and recent
guidance from the CFPB to allow transition to "comparable rates," including SOFR
or Prime. Certain derivatives without a clearly defined or practicable
replacement benchmark rate will use the recent Federal legislation to replace
LIBOR with a SOFR-based rate that will be established by FRB rulemaking. This
legislation will also provide additional administrative benefit for a small
portion of the commercial and consumer lending portfolios where contracts do not
contain fallback language.

                                                 Truist Financial Corporation 55
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Training has been provided for impacted teammates and will continue during 2022.
Truist will continue to provide timely notices and information to impacted
clients about the transition during 2022 and the first half of 2023. Truist
continues to manage the impact of these contracts and other financial
instruments, systems implications, hedging strategies, and related operational
and market risks on established project plans for business and operational
readiness to support the transition.

As of December 31, 2021, Truist ceased entering into new contracts with a LIBOR
reference rate for all product offerings, except on a limited basis, as
permissible. Market risks associated with this change are dependent on the
alternative reference rates available and market conditions as of the
transition. The Company is actively using SOFR as a reference rate and has
originated approximately $30 billion of loans, issued $5 billion of long-term
debt, and has $50 billion in notional derivative exposure using this alternative
reference rate as of March 31, 2022. Truist expects SOFR to become a more
commonly-used pricing benchmark across the industry and will continue to offer
additional SOFR based products during 2022. Additional alternative reference
rates, such as Bloomberg Short Term Bank Yield will be supported based on market
demand. Other emerging credit sensitive rates will be evaluated as additional
alternatives for LIBOR based on market developments. For a further discussion of
the various risks associated with the potential cessation of LIBOR and the
transition to alternative reference rates, refer to the section titled "Item1A.
Risk Factors" in the Form 10-K for the year ended December 31, 2021.

Market risk related to trading activities

As a financial intermediary, Truist provides its clients access to derivatives,
foreign exchange and securities markets, which generate market risks. Trading
market risk is managed using a comprehensive risk management approach, which
includes measuring risk using VaR, stress testing, and sensitivity analysis.
Risk metrics are monitored against a suite of limits on a daily basis at both
the trading desk level and at the aggregate portfolio level, which is intended
to ensure that exposures are in line with Truist's risk appetite.

Truist is also subject to risk-based capital guidelines for market risk under the market risk rule.

Covered Trading Positions

Covered positions subject to the Market Risk Rule include trading assets and
liabilities, specifically those held for the purpose of short-term resale or
with the intent of benefiting from actual or expected short-term price movements
or to lock in arbitrage profits. Truist's trading portfolio of covered positions
results primarily from market making and underwriting services for the Company's
clients, as well as associated risk mitigating hedging activity. The trading
portfolio, measured in terms of VaR, consists primarily of four sub-portfolios
of covered positions: (i) credit trading, (ii) fixed income securities, (iii)
interest rate derivatives, and (iv) equity derivatives. As a market maker across
different asset classes, Truist's trading portfolio also contains other
sub-portfolios, including foreign exchange, loan trading, and commodity
derivatives; however, these portfolios do not generate material trading risk
exposures.

Valuation policies and methodologies exist for all trading positions.
Additionally, these positions are subject to independent price verification. See
"Note 16. Derivative Financial Instruments," "Note 15. Fair Value Disclosures,"
and "Critical Accounting Policies" herein for discussion of valuation policies
and methodologies.

Securitizations

As of March 31, 2022, the aggregate market value of on-balance sheet
securitization positions subject to the Market Risk Rule was $33 million, all of
which were non-agency asset backed securities positions. Consistent with the
Market Risk Rule requirements, the Company performs pre-purchase due diligence
on each securitization position to identify the characteristics including, but
not limited to, deal structure and the asset quality of the underlying assets,
that materially affect valuation and performance. Securitization positions are
subject to Truist's comprehensive risk management framework, which includes
daily monitoring against a suite of limits. There were no off-balance sheet
securitization positions during the reporting period.

Correlation trading positions

The trading portfolio of hedged positions did not contain any correlation trading positions at March 31, 2022.

56 Truist Financial Corporation
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VaR-based measures

VaR measures the potential loss of a given position or portfolio of positions at
a specified confidence level and time horizon. Truist utilizes a historical VaR
methodology to measure and aggregate risks across its covered trading positions.
For risk management purposes, the VaR calculation is based on a historical
simulation approach and measures the potential trading losses using a one-day
holding period at a one-tail, 99% confidence level. For Market Risk Rule
purposes, the Company calculates VaR using a 10-day holding period and a 99%
confidence level. Due to inherent limitations of the VaR methodology, such as
the assumption that past market behavior is indicative of future market
performance, VaR is only one of several tools used to measure and manage market
risk. Other tools used to actively manage market risk include stress testing,
scenario analysis, and stop loss limits.

The trading portfolio's VaR profile is influenced by a variety of factors,
including the size and composition of the portfolio, market volatility, and the
correlation between different positions. A portfolio of trading positions is
typically less risky than the sum of the risk from each of the individual
sub-portfolios, because, under normal market conditions, risk within each
category partially offsets the exposure to other risk categories. The following
table summarizes certain VaR-based measures for the three months ended March 31,
2022 and 2021. Average one and ten day VaR measures declined from last year as
heightened market volatility experienced during March 2020 aged out of the
12-month VaR look-back window.
Table 19: VaR-based Measures
                                                        Three Months Ended March 31,
                                                              2022                              2021

                                                                            10-Day Holding                                          10-Day Holding
(Dollars in millions)                                                      
    Period               1-Day Holding Period               Period         
     1-Day Holding Period
VaR-based Measures:
Maximum                                                                   $             38          $                 14          $             68          $                 16
Average                                                                                 18                             6                        39                            10
Minimum                                                                                  9                             3                         3                             3
Period-end                                                                              15                             4                         5                             3
VaR by Risk Class:
Interest Rate Risk                                                                                                     4                                                       2
Credit Spread Risk                                                                                                     4                                                       4
Equity Price Risk                                                                                                      4                                                       1
Foreign Exchange Risk                                                                                                  -                                                       -
Portfolio Diversification                                                                                             (8)                                                     (5)
Period-end                                                                                                             4                                                       3



Stressed VaR-based measures

Stressed VaR, another component of market risk capital, is calculated using the
same internal models as used for the VaR-based measure. Stressed VaR is
calculated over a ten-day holding period at a one-tail, 99% confidence level and
employs a historical simulation approach based on a continuous twelve-month
historical window selected to reflect a period of significant financial stress
for the Company's trading portfolio. The following table summarizes Stressed
VaR-based measures:
Table 20: Stressed VaR-based Measures - 10 Day Holding Period
                                                                        Three Months Ended
                                                                             March 31,

(Dollars in millions)                                                                 2022             2021
Maximum                                                                            $   109          $    72
Average                                                                                 76               54
Minimum                                                                                 59               26
Period-end                                                                              72               64


Compared to the previous year, stressed VaR measures have increased in 2022, mainly due to the normalization of market making inventory levels this year.

Specific risk measures

Specific risk is a measure of idiosyncratic risk that could result from risk
factors other than broad market movements (e.g. default or event risks). The
Market Risk Rule provides fixed risk weights under a standardized measurement
method while also allowing a model-based approach, subject to regulatory
approval. Truist utilizes the standardized measurement method to calculate the
specific risk component of market risk regulatory capital. As such, incremental
risk capital requirements do not apply.

                                                 Truist Financial Corporation 57
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Backtesting of the VaR model

In accordance with the Market Risk Rule, the Company evaluates the accuracy of
its VaR model through daily backtesting by comparing aggregate daily trading
gains and losses (excluding fees, commissions, reserves, net interest income,
and intraday trading) from covered positions with the corresponding daily
VaR-based measures generated by the model. As illustrated in the following
graph, VaR measures briefly increased in the first quarter of 2022 due to the
increase in market volatility that normalized towards the end of the quarter.
There were no Company-wide VaR backtesting exceptions during the twelve months
ended March 31, 2022. The total number of Company-wide VaR backtesting
exceptions over the preceding twelve months is used to determine the
multiplication factor for the VaR-based capital requirement under the Market
Risk Rule. The capital multiplication factor increases from a minimum of three
to a maximum of four, depending on the number of exceptions. All Company-wide
VaR backtesting exceptions are thoroughly reviewed in the context of VaR model
use and performance. There was no change in the capital multiplication factor
over the preceding twelve months.
                     [[Image Removed: tfc-20220331_g1.jpg]]

Model risk management

MRM is responsible for the independent model validation of all decision tools
and models including trading market risk models. The validation activities are
conducted in accordance with MRM policy, which incorporates regulatory guidance
related to the evaluation of model conceptual soundness, ongoing monitoring, and
outcomes analysis. As part of ongoing monitoring efforts, the performance of all
trading risk models are reviewed regularly to preemptively address emerging
developments in financial markets, assess evolving modeling approaches, and to
identify potential model enhancement.

Stress tests

The Company uses a comprehensive range of stress testing techniques to help
monitor risks across trading desks and to augment standard daily VaR and other
risk limits reporting. The stress testing framework is designed to quantify the
impact of extreme, but plausible, stress scenarios that could lead to large
unexpected losses. Stress tests include simulations for historical repeats and
hypothetical risk factor shocks. All trading positions within each applicable
market risk category (interest rate risk, equity risk, foreign exchange rate
risk, credit spread risk, and commodity price risk) are included in the
Company's comprehensive stress testing framework. Management reviews stress
testing scenarios on an ongoing basis and makes updates, as necessary, which is
intended to ensure that both current and emerging risks are captured
appropriately. Management also utilizes stress analyses to support the Company's
capital adequacy assessment standards. See the "Capital" section of MD&A for
additional discussion of capital adequacy.

Liquidity

Liquidity represents the continuing ability to meet funding needs, including
deposit withdrawals, repayment of borrowings and other liabilities, and funding
of loan commitments. In addition to the level of liquid assets, such as cash,
cash equivalents, and AFS securities, other factors affect the ability to meet
liquidity needs, including access to a variety of funding sources, maintaining
borrowing capacity, growing core deposits, loan repayment, and the ability to
securitize or package loans for sale.

58 Truist Financial Corporation
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Truist monitors the ability to meet client demand for funds under both normal
and stressed market conditions. In considering its liquidity position,
management evaluates Truist's funding mix based on client core funding, client
rate-sensitive funding, and national markets funding. In addition, management
evaluates exposure to rate-sensitive funding sources that mature in one year or
less. Management also measures liquidity needs against 30 days of stressed cash
outflows for Truist and Truist Bank. To ensure a strong liquidity position and
compliance with regulatory requirements, management maintains a liquid asset
buffer of cash on hand and highly liquid unencumbered securities.

Internal liquidity stress tests

Liquidity stress testing is designed to ensure that Truist and Truist Bank have
sufficient liquidity for a variety of institution-specific and market-wide
adverse scenarios. Each liquidity stress test scenario applies defined
assumptions to execute sources and uses of liquidity over varying planning
horizons. The types of expected liquidity uses during a stressed event may
include deposit attrition, contractual maturities, reductions in unsecured and
secured funding, and increased draws on unfunded commitments. To mitigate
liquidity outflows, Truist has identified sources of liquidity; however, access
to these sources of liquidity could be affected within a stressed environment.

Truist maintains a liquidity buffer of cash on hand and highly liquid
unencumbered securities that is sufficient to meet the projected net stressed
cash-flow needs and maintain compliance with regulatory requirements. The
liquidity buffer consists of unencumbered highly liquid assets and Truist's
liquidity buffer is substantially the same in composition to what qualifies as
HQLA under the LCR Rule.

Contingency Funding Plan

Truist has a contingency funding plan designed to ensure that liquidity sources
are sufficient to meet ongoing obligations and commitments, particularly in the
event of a liquidity contraction. This plan is designed to examine and quantify
the organization's liquidity under the various internal liquidity stress
scenarios and is periodically tested to assess the plan's reliability.
Additionally, the plan provides a framework for management and other critical
teammates to follow in the event of a liquidity contraction or in anticipation
of such an event. The plan addresses authority for activation and decision
making, liquidity options, and the responsibilities of key departments in the
event of a liquidity contraction.

LCR and HQLA

The LCR rule requires that Truist and Truist Bank maintain an amount of eligible
HQLA that is sufficient to meet its estimated total net cash outflows over a
prospective 30 calendar-day period of stress. Eligible HQLA, for purposes of
calculating the LCR, is the amount of unencumbered HQLA that satisfy operational
requirements of the LCR rule. Truist and Truist Bank are subject to the Category
III reduced LCR requirements. Truist held average weighted eligible HQLA of
$83.9 billion and Truist's average LCR was 111% for the three months ended March
31, 2022.

Effective July 2021, Truist became subject to final rules implementing the NSFR,
which are designed to ensure that banking organizations maintain a stable,
long-term funding profile in relation to their asset composition and off-balance
sheet activities. At March 31, 2022, the Company was compliant with this
requirement.

Sources of funds

Management believes current sources of liquidity are sufficient to meet Truist's
on- and off-balance sheet obligations. Truist funds its balance sheet through
diverse sources of funding including client deposits, secured and unsecured
capital markets funding, and shareholders' equity. Truist Bank's primary source
of funding is client deposits. Continued access to client deposits is highly
dependent on public confidence in the stability of Truist Bank and its ability
to return funds to clients when requested.

Truist Bank maintains a number of diverse funding sources to meet its liquidity
requirements. These sources include unsecured borrowings from the capital
markets through the issuance of senior or subordinated bank notes, institutional
CDs, overnight and term Federal funds markets, and retail brokered CDs. Truist
Bank also maintains access to secured borrowing sources including FHLB advances,
repurchase agreements, and the FRB discount window. The following table presents
a summary of Truist Bank's available secured borrowing capacity and eligible
cash at the FRB:
                                                 Truist Financial Corporation 59
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Table 21: Liquidity Sources
(Dollars in millions)                                                 Mar 31, 2022           Dec 31, 2021
Unused borrowing capacity:
FRB                                                                 $      51,876          $      52,170
FHLB                                                                       45,961                 49,244
Available investment securities (after haircuts)                          110,327                116,600
Available secured borrowing capacity                                      208,164                218,014
Eligible cash at the FRB                                                   23,060                 14,714
Total                                                               $     231,224          $     232,728


To March 31, 2022, Truist Bank’s available committed borrowing capacity was approximately 7.4 times the amount of wholesale funding maturities of one year or less.

Parent Company

The Parent Company serves as the primary source of capital for the operating
subsidiaries. The Parent Company's assets consist primarily of cash on deposit
with Truist Bank, equity investments in subsidiaries, advances to subsidiaries,
and notes receivable from subsidiaries. The principal obligations of the Parent
Company are payments on long-term debt. The main sources of funds for the Parent
Company are dividends and management fees from subsidiaries, repayments of
advances to subsidiaries, and proceeds from the issuance of equity and long-term
debt. The primary uses of funds by the Parent Company are investments in
subsidiaries, advances to subsidiaries, dividend payments to common and
preferred shareholders, repurchases of common stock, and payments on long-term
debt. See "Note 22. Parent Company Financial Information" in Truist's Annual
Report on Form 10-K for the year ended December 31, 2021 for additional
information regarding dividends from subsidiaries and debt transactions.

Access to funding at the Parent Company is more sensitive to market disruptions.
Therefore, Truist prudently manages cash levels at the Parent Company to cover a
minimum of one year of projected cash outflows which includes unfunded external
commitments, debt service, common and preferred dividends and scheduled debt
maturities, without the benefit of any new cash inflows. Truist maintains a
significant buffer above the projected one year of cash outflows. In determining
the buffer, Truist considers cash requirements for common and preferred
dividends, unfunded commitments to affiliates, serving as a source of strength
to Truist Bank, and being able to withstand sustained market disruptions that
could limit access to the capital markets. At March 31, 2022 and December 31,
2021, the Parent Company had 30 months and 35 months, respectively, of cash on
hand to satisfy projected cash outflows, and 19 months and 19 months,
respectively, when including the payment of common stock dividends.

Credit ratings

Credit ratings are forward-looking opinions of rating agencies as to the
Company's ability to meet its financial commitments and repay its securities and
obligations in accordance with their terms of issuance. Credit ratings influence
both borrowing costs and access to the capital markets. The Company's credit
ratings are continuously monitored by the rating agencies and are subject to
change at any time. As Truist seeks to maintain high-quality credit ratings,
management meets with the major rating agencies on a regular basis to provide
financial and business updates and to discuss current outlooks and trends. See
Item 1A, "Risk Factors" in Truist's Annual Report on Form 10-K for the year
ended December 31, 2021 for additional information regarding factors that
influence credit ratings and potential risks that could materialize in the event
of downgrade in the Company's credit ratings.

Credit ratings and outlook Truist and Truist Bank are unchanged from those presented in the Company’s 2021 Annual Report on Form 10-K.

Capital

The maintenance of appropriate levels of capital is a management priority and is
monitored on a regular basis. Truist's principal goals related to the
maintenance of capital are to provide adequate capital to support Truist's risk
profile consistent with the Board-approved risk appetite, provide financial
flexibility to support future growth and client needs, comply with relevant
laws, regulations, and supervisory guidance, achieve optimal credit ratings for
Truist and its subsidiaries, remain a source of strength for its subsidiaries,
and provide a competitive return to shareholders. Risk-based capital ratios,
which include CET1 capital, Tier 1 capital, and Total capital are calculated
based on regulatory guidance related to the measurement of capital and
risk-weighted assets.

60 Truist Financial Corporation
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Truist regularly performs stress testing on its capital levels and is required
to periodically submit the Company's capital plans and stress testing results to
the banking regulators. Management regularly monitors the capital position of
Truist on both a consolidated and bank-level basis. In this regard, management's
overriding policy is to maintain capital at levels that are in excess of
internal capital targets, which are above the regulatory "well capitalized"
minimums. Management evaluates whether capital ratios calculated after the
effect of alternative capital actions are likely to remain above minimums
specified by the FRB for the annual CCAR process. Breaches of minimum targets
prompt a review of the planned capital actions included in Truist's capital
plan.
Table 22: Capital Requirements
                                                                                                                                     Minimum Capital
                                                                                           Well Capitalized                            Plus Stress
                                                                                                                                     Capital Buffer
                                                   Minimum Capital                 Truist                    Truist Bank                   (1)
CET1                                                         4.5  %                             NA                     6.5  %                  7.0  %
Tier 1 capital                                               6.0                            6.0  %                     8.0                     8.5
Total capital                                                8.0                           10.0                       10.0                    10.5
Leverage ratio                                               4.0                                NA                     5.0                         NA
Supplementary leverage ratio                                 3.0                                NA                         NA                      NA


(1)Reflects a SCB of 2.5% applicable to Truist as of March 31, 2022. Truist's
SCB, received in the 2021 CCAR process, is effective from October 1, 2021 to
September 30, 2022.

Truist’s capital ratios are presented in the following table: Table 23: Capital ratios – Truist Financial Corporation

(Dollars in millions, except per share data, shares in thousands)

  Mar 31, 2022          Dec 31, 2021
Risk-based:                                                                 

(preliminary)

CET1 capital to risk-weighted assets                                                 9.4  %                9.6  %
Tier 1 capital to risk-weighted assets                                              11.0                  11.3
Total capital to risk-weighted assets                                               13.0                  13.2
Leverage ratio                                                                       8.6                   8.7
Supplementary leverage ratio                                                         7.3                   7.4
Non-GAAP capital measure (1):
Tangible common equity per common share                                    $       21.87          $      25.47
Calculation of tangible common equity (1):
Total shareholders' equity                                                 $      65,044          $     69,271
Less:
Preferred stock                                                                    6,673                 6,673
Noncontrolling interests                                                              23                     -
Goodwill and intangible assets, net of deferred taxes                             29,229                28,772
Tangible common equity                                                     $      29,119          $     33,826
Risk-weighted assets                                                       $     397,611          $    390,886
Common shares outstanding at end of period                                     1,331,414             1,327,818


(1)Tangible common equity and related measures are non-GAAP measures that
exclude the impact of intangible assets, net of deferred taxes, and their
related amortization. These measures are useful for evaluating the performance
of a business consistently, whether acquired or developed internally. Truist's
management uses these measures to assess the quality of capital and returns
relative to balance sheet risk. These capital measures are not necessarily
comparable to similar capital measures that may be presented by other companies.

Capital ratios remained strong compared to the regulatory requirements for well
capitalized banks. For the three months ended March 31, 2022, Truist paid $637
million in common stock dividends or $0.48 per share. The dividend and total
payout ratios for the three months ended March 31, 2022 were 48%.

Truist CET1 ratio was 9.4% as of March 31, 2022. The 20 basis point decline
compared to the fourth quarter 2021 CET1 ratio reflects capital deployed through
the acquisition of Kensington Vanguard National Land Services, the acquisition
of certain merchant services relationships, an increase in risk-weighted assets,
and the impact from the phase in of the CECL transition relief.

                                                 Truist Financial Corporation 61
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Share Repurchase Activity
Table 24: Share Repurchase Activity
                                                                                                                       Maximum Remaining
                                                                                                                     Dollar Value of Shares
                                                                     Average          Total Shares Repurchased           Available for
                                                                    Price Paid              Pursuant to              Repurchase Pursuant to
(Dollars in millions, except per share      Total Shares            Per 

Share Publicly-Announced Plan Publicly-Announced data, parts in thousands)

                Repurchased (1)              (2)                      (3)                           Plan
January 2022                                         -             $       -                         -               $             2,565
February 2022                                        -                     -                         -                             2,565
March 2022                                          47                 58.02                         -                             2,565
Total                                               47                 58.02                         -


(1)Includes shares exchanged or surrendered in connection with the exercise of
equity-based awards under equity-based compensation plans.
(2)Excludes commissions.
(3)Pursuant to the 2020 Repurchase Plan, announced in December 2020, authorizing
up to $2.0 billion of share repurchases beginning in the first quarter of 2021.
In June 2021, the Board of Directors increased, effective July 1, 2021, the
previous repurchase authority to effectuate repurchases up to an additional $2.2
billion in shares of the Company's common stock through September 30, 2022 (up
to $4.2 billion in aggregate amount). With the additional authorization, the
Company has $2.6 billion remaining for share repurchases.

Critical accounting policies

The accounting and reporting policies of Truist are in accordance with GAAP and
conform to the accounting and reporting guidelines prescribed by bank regulatory
authorities. Truist's financial position and results of operations are affected
by management's application of accounting policies, including estimates,
assumptions, and judgments made to arrive at the carrying value of assets and
liabilities, and amounts reported for revenues and expenses. Different
assumptions in the application of these policies could result in material
changes in the consolidated financial position and/or consolidated results of
operations, and related disclosures. Material estimates that are particularly
susceptible to significant change include the determination of the ACL;
determination of fair value for securities, MSRs, LHFS, trading loans, and
derivative assets and liabilities; goodwill and other intangible assets; income
taxes; and pension and postretirement benefit obligations. Understanding
Truist's accounting policies is fundamental to understanding the consolidated
financial position and consolidated results of operations. The critical
accounting policies are discussed in MD&A in Truist's Annual Report on Form 10-K
for the year ended December 31, 2021. Significant accounting policies and
changes in accounting principles and effects of new accounting pronouncements
are discussed in "Note 1. Basis of Presentation" in Form 10-K for the year ended
December 31, 2021. Disclosures regarding the effects of new accounting
pronouncements are included in the "Note 1. Basis of Presentation" in this
report. There have been no changes to the significant accounting policies during
2022.

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