Goldman Sachs: Key Investor Topics in Regional Banks and Consumer Finance

Key Takeaways

• 1.Capital One (COF): Goldman estimates 2028 ROTCE of ~20.6% at a 12.5% CET1 ratio generating $26.30 in EPS, or ~22.0% ROTCE and $27.30 EPS at 11% CET1, viewing $26+ as achievable base-case earnings power supporting a path toward $260+ share price.
• 2.Ally Financial (ALLY): Retail auto NCO losses are projected at ~1.90% in 2026 and ~1.95% in 2027 (above consensus of 1.79%) driven by seasoning of the looser 2025 vintage, while rate hikes bring 2027 NIM to ~3.75%.
• 3.Truist Financial (TFC): The incoming CEO's playbook will likely target reducing auto loan exposures, expanding consumer deposits, and disciplined investments; TFC should deliver at least a ~14% ROTCE in 2027, ahead of the ~13% market pricing.

Table of Contents

• COF: What is the right ROTCE (and EPS) in 2028?
• Bringing it to 2Q26 and then 2028 – a ROTCE between ~20.6% and ~22% depending on capital leverage
• ALLY: What do we expect for 2027 losses? What do rate hikes mean for its 2027 NIM?
• Gross losses have inflected higher on a YoY basis while elevated recoveries benefit NCOs
• All together, we see losses coming in at ~1.90% in 2026 and 1.95% 2027
• Bonus: What do two hikes mean for ALLY's NIM in 2H and into 2027?
• TFC: What could the potential playbook for its new CEO be?
• Level setting - the market appears to be pricing in a ~13% ROTCE for TFC in 2027
• Potential area of focus #1 - improving risk-adjusted margin through further auto reduction
• Potential area of focus #2 - regaining share in consumer deposits
• Potential area of focus #3 - accelerating payments growth
• Potential area of focus #4 - accelerating investments while launching a continuous improvement plan
• Potential area of focus #5 - additional securities restructuring
• Bringing it all together - we see a minimum~14% ROTCE in 2027
• HBAN: Is there a path to $1.90–$1.93 of EPS in 2027?
• What is being assumed in HBAN’s NII growth for 2H and where do we see 2026 growth coming in at?
• Conservatism in fee guide plus the softer NII trends points to ~$0.40 of exit EPS (~$1.61 annualized)
• What are the additional levers for EPS growth in 2027 beyond NII and fees?
• And for NII growth into next year? We estimate ~8.3% YoY with a slower pace of NIM expansion
• What does it all mean? Core trends point to a smidge above ~$1.80 of EPS while a path to ~$1.90 seems possible
• KEY: Where do we see KEY’s 4Q26 exit NIM reaching and is 3.25% achievable in 2027?
• We see KEY’s NIM exiting at ~3.00% in 4Q26
• We see continued NII growth vs 4Q's exit from balance sheet growth, fixed rate repricing, and accretive growth
• Price target and risks

Report data

Exhibit 10: Bringing it all together, we see $26.30 of EPS and a ~21% ROTCE managing to a 12.5% CET1 with $27.30 of earnings under an 11% CET1, pointing to a ~22% ROTCE

Reports in this series

Americas Banks: Regional is shown in chronological order through this edition, published on September 11, 2026.

1. Jul 24Americas Banks Regional Key Takeaways from AXP and FHB earnings