Fifth Third Bancorp reported third-quarter 2026 net income of $828 million on Monday, up 36% from a year earlier, as its expanded balance sheet lifted interest income following the February acquisition of Comerica. Adjusted earnings were $1.13 per diluted share, while GAAP earnings were $0.90 per share.
The quarter gives an early read on how the Cincinnati-based lender is absorbing Comerica. Because the year-over-year growth rates include the acquired bank, they overstate the gain in Fifth Third’s legacy business.
Net interest income expands with the larger bank
Net interest income on a fully taxable-equivalent basis was $2.276 billion, 3% higher than in the second quarter and 49% above the year-earlier period. The company attributed the increase to the Comerica acquisition, loan growth, repricing of fixed-rate assets, interest rates and active management of its investment portfolio. Higher deposit costs and the movement of Comerica sweep balances into interest-bearing deposits partly offset those benefits.
The quarter’s net interest margin was 3.34%, compared with 3.36% in the prior quarter. A bigger balance sheet does not automatically earn more per dollar of assets, and the question now is whether loan yields and cheaper deposits can hold the margin as the deal settles in.
Average deposits rose to $238.3 billion from $231.5 billion in the second quarter. Average loans and leases were $179.2 billion, up from $177.6 billion. The combined bank is bigger; the margin and funding mix show how well it is using that size.
Fees add another source of revenue
Adjusted noninterest income, excluding securities gains and losses, was $1.052 billion, up 1% from the previous quarter and 33% from a year earlier. Wealth management generated $259 million, commercial payments $256 million, consumer banking $158 million and capital markets $147 million. Fees make a bank less dependent on the spread between what it earns on loans and pays on deposits.
Reported GAAP noninterest income was $1.008 billion, down 5% sequentially. The adjusted figure excludes securities gains and losses, which accounts for the difference.
Credit indicators remain central to the outlook
Fifth Third recorded a $122 million provision for credit losses, down from $129 million in the second quarter and $197 million a year earlier. Its net charge-off ratio was 0.31%, little changed from 0.30% in the prior quarter. Nonperforming assets were 0.64% of total assets, compared with 0.60% in the second quarter.
Nothing in those numbers suggests a sharp turn in credit, though the uptick in nonperforming assets bears watching. The bigger question is whether credit costs stay contained as the bank folds in a larger commercial loan book.
Integration and the next checkpoints
Chief Executive Tim Spence said the company completed the systems conversion for the Comerica integration during the quarter and reported strong retention of clients and bankers. The conversion is a milestone, but it says little yet about how much of the deal’s promised financial benefit has arrived.
Fifth Third’s adjusted earnings exclude $0.23 per share of “certain items,” according to the release filed with the SEC. The acquisition also complicates year-over-year comparisons: net income was $608 million in the third quarter of 2025, before the Comerica transaction closed on February 1, 2026.
Net interest margin, deposit pricing, loan growth and credit quality will show in coming quarters how much of the improvement is real progress and how much is simply a larger balance sheet. Zacks credited growth in net interest income and fees for the quarter’s beat.