First Citizens BancShares, Inc.

What they do

First Citizens operates through its banking subsidiary First-Citizens Bank & Trust Company, offering deposits, loans, wealth management, and private banking to consumers, as well as lending, leasing, capital markets, and advisory services to small and middle-market companies, private equity and venture capital firms, and innovation-sector clients. It also serves homeowner associations and property management companies and owns a railcar and locomotive leasing fleet. Non-bank subsidiaries provide investment products, brokerage, underwriting, and asset management services. The company has expanded through de novo branching and acquisitions.

Revenue drivers

• Net interest income — Largest revenue source; $1.66 billion in Q2 2026, up $35 million from the linked quarter, driven by higher loan yields and balances, partially offset by higher deposit costs.
• Noninterest income — $776 million in Q2 2026, up $84 million from Q1 2026, with increases in other noninterest income (including $27 million fair value gain on derivatives and $17 million gain on tax credit investments), client investment fees, lending-related fees, and deposit fees.
• Client investment fees and lending-related fees — Smaller but growing fee lines; client investment fees rose $6 million and lending-related fees rose $4 million in Q2 2026, reflecting higher volume and line of credit activity.

Recent performance

For Q2 2026 (quarter ended June 30, 2026), net income was $672 million, up from $534 million in Q1 2026; net income available to common stockholders was $640 million, or $55.52 per share, versus $508 million, or $42.63 per share. Net interest margin was 3.10%, up 1 basis point from the linked quarter. Total assets grew to $236.84 billion at June 30, 2026 from $229.70 billion at year-end 2025. The company returned $600 million to stockholders via share repurchases in the quarter. Annual net income has declined from a 2023 peak of $11.47 billion to $2.21 billion in 2025.

Strategy

The company plans to continue organic growth while pursuing acquisitions, including the pending BMO Branch Acquisition of 138 branches, expected to close in Q3 2026. Management emphasizes balanced loan and deposit growth, resilient credit quality, disciplined expense management, and optimizing the balance sheet, including prepaying the Purchase Money Note. It returned capital through share repurchases and dividends. It also focuses on integrating prior acquisitions, including the Silicon Valley Bank purchase, and expanding its footprint in new markets.

Risks

• Acquisition integration risk — The pending BMO Branch Acquisition and past deals like SVBB involve integration complexities, potential cost overruns, and may not deliver expected benefits.
• Regulatory and merger review risk — Larger banking organizations like First Citizens face enhanced scrutiny in merger approvals, which could delay or impose conditions on future acquisitions.
• Competition and disintermediation risk — Banks face competition from non-bank providers and the possibility that consumers may increasingly choose non-bank financial services, pressuring margins and market share.
• Concentration and affiliated ownership risk — The Holding family controls a large percentage of stock and certain charter provisions may deter takeovers, potentially limiting shareholder influence.

Outlook

Management expects the BMO Branch Acquisition to close in the third quarter of 2026, assuming approximately $5.3 billion in deposits and $700 million in loans. They cited solid return metrics and strong capital and liquidity positions in Q2, with expectations that balanced growth and disciplined expense management will continue. They also prepaid $2.5 billion of the Purchase Money Note in Q2, indicating a focus on reducing borrowings.