Citizens lifts earnings 29% and raises the dividend as buyback capacity jumps to $1.95 billion

Citizens Financial Group reported third-quarter net income of $636 million, up 29% from a year earlier, and diluted earnings of $1.41 a share, and said its board had raised the common dividend 13% to $0.52 while lifting share-repurchase capacity to $1.95 billion.

Earnings and returns

Citizens Financial Group, Inc. said third-quarter net income was $636 million, up 29% from $494 million a year earlier, and diluted earnings were $1.41 a share, up 34% from $1.05. Net income available to common shareholders was $599 million, up 31% from $457 million a year earlier. Compared with the second quarter, net income rose 8% and diluted EPS rose 8% from $1.30.

Return on average tangible common equity, a non-GAAP measure, was 15.1%, up from 13.9% in the prior quarter and 11.7% a year earlier, compared with a GAAP return on average common equity of 10.05%. Total revenue was $2.32 billion, up 10% from a year earlier. Net interest income was $1.68 billion, up 13% from a year earlier and 2.7% from the prior quarter, with the fully taxable-equivalent net interest margin at 3.19%, up 2 basis points from the prior quarter and 19 basis points from a year earlier. Noninterest income was $647 million, up 2.7% from a year earlier but down 1% from the prior quarter as lower mortgage and capital-markets fees outweighed record wealth fees of $109 million.

Pre-provision profit, a non-GAAP measure equal to total revenue minus noninterest expense, was $929 million, up 4.5% from the prior quarter and 18.6% from a year earlier. The efficiency ratio improved to 60% from 61.1% and 63%. The provision for credit losses was $125 million, down from $134 million in the prior quarter and $154 million a year earlier. The net charge-off ratio was 0.37%, unchanged from the prior quarter and down from 0.46% a year earlier. The allowance for credit losses covered 1.47% of loans.

Period-end loans and leases were $148.2 billion and deposits were $185.2 billion. Total assets were $234.5 billion. The preliminary common equity Tier 1 capital ratio was 10.5%, up from 10.4% three months earlier. Citizens said its Private Bank contributed about $0.16 to diluted EPS and that Private Bank spot deposits rose about $750 million, or 4%, to $18.5 billion.

Dividend increase and larger buyback authorization

The board declared a quarterly common dividend of $0.52 a share, a $0.06, or 13%, increase from the prior quarter. The dividend is payable on Nov. 13, 2026, to shareholders of record on Oct. 30, 2026. The board also increased the capacity of the common share repurchase program to $1.95 billion, $1.3 billion above the $650 million of capacity remaining under the June 2025 authorization.

In the third quarter Citizens returned $322 million of capital to shareholders, including $197 million of common dividends and $125 million of share repurchases. Buybacks were lower than the $225 million repurchased in the second quarter and higher than the $75 million in the year-earlier quarter.

Tangible book value per common share was $35.78, down 6.6% from $38.29 at June 30. Citizens attributed the decline to the negative impact of higher long-term rates on its investment securities and swap portfolios. Tangible book value per share is a non-GAAP measure the company discloses alongside GAAP book value.

What management emphasized

"We continued to deliver attractive revenue and earnings growth in the third quarter, notwithstanding significant volatility in the external environment," Chairman and Chief Executive Bruce Van Saun said in the release. "We remain focused on executing our strategic initiatives, advancing our AI, technology and cybersecurity agenda, and attracting great talent. We remain confident in our positioning and outlook for Q4 and for 2027."

Executives were scheduled to discuss the results on a call at 9 a.m. ET on Friday.

Shares after the report

Citizens shares were trading near $63.85 in Friday morning New York Stock Exchange dealing, according to market data pulled while this article was prepared. The stock had closed near $63.43 on Thursday. Prices change continuously; check a live quote for the current level.