Fifth Third Bancorp (FITB:US), Ohio’s largest lender, fell the most since 2012 after reporting first-quarter profit that missed analysts’ estimates and lowering its earnings forecast.
Fifth Third slid 4.8 percent to $20.81 at 12:42 p.m. in New York, the biggest intraday decline since June 2012. The Cincinnati-based bank was the worst performer in the 24-company KBW Bank Index (BKX), which declined 0.5 percent.
First-quarter profit fell 25 percent to $309 million, or 36 cents a share, the firm said today in a statement, falling short of the 42-cent average estimate (FITB:US) of 29 analysts surveyed by Bloomberg. Noninterest income in 2014 will be “down mid-to-high single digits” compared with an earlier forecast of “down mid-single digits,” while net revenue excluding provisions will be “up low-single digits” instead of “up mid-single digits,” the bank said today in a forecast.
“This negative change, while not huge, could cause a bit of weakness in the shares as investors contemplate the possible need to reduce earnings expectations for 2014,” R. Scott Siefers, an analyst at Sandler O’Neill & Partners LP, said in a note to investors. He has a buy rating on the stock.
Revenue slid 24 percent in the quarter from a year earlier as fees from mortgage banking declined. Fifth Third allocated $51 million for litigation-related expenses.
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