Fifth Third Bancorp Q2 2020 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Rahul Suresh Patil - Evercore ISI Institutional Equities, Research Division - Analyst : This is Rahul Patil on behalf of John. I just want to go back to the discussion around the reserve release. And I want to put some numbers around it so correct me if I'm wrong. So you've guided to average loans down 3.5%, 4%. Let's say, loans are declining, looks like around $4 billion of that. Commercial loans are coming down, $5 billion. Consumer is going up by $1 billion. And you've guided to charge-offs of around -- it looks like it's around $150 million in 3Q of charge-offs. So am I thinking about this right, that in terms of provisioning in 3Q, the -- really, the main driver of provision will be the consumer new loan growth of $1 billion. And basically, is it fair to then assume and apply that 3% reserve ratio on that $1 billion of new loan growth. And basically, that would imply like $30 million to $40 million of provision in third quarter. Am I thinking about that right?

Question: Rahul Suresh Patil - Evercore ISI Institutional Equities, Research Division - Analyst : Okay. But I just want to make sure like conceptually, am I thinking about this correctly in terms of -- with regards to provision, and this is also assuming that the macro doesn't get worse or doesn't get better. It's basically assuming a status quo.