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Risk Overview Q2, 2026
Risk Distribution
48% Finance & Corporate
14% Macro & Political
11% Tech & Innovation
11% Legal & Regulatory
11% Ability to Sell
5% Production
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
This chart displays the stock's most recent risk distribution according to category. TipRanks has identified 6 major categories: Finance & corporate, legal & regulatory, macro & political, production, tech & innovation, and ability to sell.
Risk Change Over Time
S&P500 Average
Sector Average
Risks removed
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Fifth Third Bancorp Risk Factors
New Risk (0)
Risk Changed (0)
Risk Removed (0)
No changes from previous report
The chart shows the number of risks a company has disclosed. You can compare this to the sector average or S&P 500 average.
The quarters shown in the chart are according to the calendar year (January to December). Businesses set their own financial calendar, known as a fiscal year. For example, Walmart ends their financial year at the end of January to accommodate the holiday season.
The quarters shown in the chart are according to the calendar year (January to December). Businesses set their own financial calendar, known as a fiscal year. For example, Walmart ends their financial year at the end of January to accommodate the holiday season.
Risk Highlights Q2, 2026
Main Risk Category
Finance & Corporate
With 21 Risks
Finance & Corporate
With 21 Risks
Number of Disclosed Risks
44
No changes from last report
S&P 500 Average: 32
44
No changes from last report
S&P 500 Average: 32
Recent Changes
0Risks added
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Since Jun 2026
0Risks added
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Number of Risk Changed
0
No changes from last report
S&P 500 Average: 0
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S&P 500 Average: 0
See the risk highlights of Fifth Third Bancorp in the last period.
Risk Word Cloud
The most common phrases about risk factors from the most recent report. Larger texts indicate more widely used phrases.
Risk Factors Full Breakdown - Total Risks 44
Finance & Corporate
Total Risks: 21/44 (48%)Below Sector Average
Share Price & Shareholder Rights3 | 6.8%
Share Price & Shareholder Rights - Risk 1
Fifth Third and/or the holders of its securities could be adversely affected by unfavorable ratings from rating agencies.Share Price & Shareholder Rights - Risk 2
Fifth Third's stock price is volatile.Fifth Third's stock price has been volatile in the past and several factors could cause the price to fluctuate substantially in the future. The price for shares of Fifth Third's common stock may fluctuate significantly in the future, and these fluctuations may be unrelated to Fifth Third's performance. General market price declines or market volatility in the future could adversely affect the price for shares of Fifth Third's common stock and the current market price of such shares may not be indicative of future market prices.
Share Price & Shareholder Rights - Risk 3
Future acquisitions may dilute current shareholders' ownership of Fifth Third and may cause Fifth Third to become more susceptible to adverse economic events.Future business acquisitions could be material to Fifth Third and it may issue additional shares of stock to pay for those acquisitions, which would dilute current shareholders' ownership interests. Acquisitions also could require Fifth Third to use substantial cash or other liquid assets or to incur debt. In those events, Fifth Third could become more susceptible to economic downturns, dislocations in capital markets and competitive pressures.
Accounting & Financial Operations4 | 9.1%
Accounting & Financial Operations - Risk 1
Changes in accounting standards or interpretations could impact Fifth Third's reported financial condition and earnings.Accounting & Financial Operations - Risk 2
Fifth Third uses models for business planning purposes that may not adequately predict future results.Fifth Third uses financial models to aid in its planning for various purposes including its capital and liquidity needs and other purposes. The models used may not accurately account for all variables, may fail to predict outcomes accurately and/or may overstate or understate certain effects. As a result, Fifth Third may not adequately prepare for future events and may suffer losses or other setbacks due to these failures.
Also, information Fifth Third provides to the public or to its regulators based on models could be inaccurate or misleading due to inadequate design or implementation, for example. Decisions that its regulators make, including those related to capital distributions to its shareholders, could be affected adversely due to the perception that the models used to generate the relevant information are unreliable or inadequate.
Accounting & Financial Operations - Risk 3
The Bancorp's ability to receive dividends from its subsidiaries accounts for most of its revenue and could affect its liquidity and ability to pay dividends.The Bancorp is a separate and distinct legal entity from its subsidiaries and typically receives substantially all of its revenue from dividends from its subsidiaries. These dividends are the principal source of funds to pay dividends on the Bancorp's stock and interest and principal on its debt. The ability of its subsidiaries to pay dividends or make other payments or distributions depends on their respective operating results and may be restricted by, among other things, regulatory constraints, prevailing economic conditions (including interest rates) and financial, business and other factors, many of which are beyond the control of the Bancorp. Regulatory scrutiny of liquidity and capital levels at BHCs and banks has resulted in increased regulatory focus on all aspects of capital planning, including dividends and other distributions. In addition, the Bancorp's right to participate in a distribution of assets upon a subsidiary's liquidation or reorganization is subject to the prior claims of that subsidiary's creditors.
Regulatory limitations on the Bancorp's ability to receive dividends from its subsidiaries, economic conditions and other financial or business factors could have a material adverse effect on the Bancorp's liquidity and ability to pay dividends on stock or interest and principal on its debt and to engage in share repurchases. For further information, refer to Regulation and Supervision in Item 1 of this Annual Report on Form 10-K and Note 3 of the Notes to Consolidated Financial Statements.
Accounting & Financial Operations - Risk 4
The preparation of financial statements requires Fifth Third to make subjective determinations and use estimates that may vary from actual results and materially impact its financial position or results of operations.The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make significant estimates that affect the financial statements. If new information arises that results in a material change to a reserve amount, such a change could result in a change to previously announced financial results. Refer to the Critical Accounting Policies section of Item 7 of this Annual Report for more information regarding management's significant estimates.
Debt & Financing6 | 13.6%
Debt & Financing - Risk 1
Fifth Third must maintain adequate sources of funding and liquidity.Debt & Financing - Risk 2
If Fifth Third is unable to maintain or grow its deposits, it may be subject to paying higher funding costs.The total amount that Fifth Third pays for funding costs is dependent, in part, on Fifth Third's ability to maintain or grow its deposits. If Fifth Third is unable to sufficiently maintain or grow its deposits to meet liquidity objectives, it may be subject to paying higher funding costs. Fifth Third competes with banks and other financial services companies for deposits. If competitors raise the rates they pay on deposits, Fifth Third's funding costs may increase, either because Fifth Third raises rates to avoid losing deposits or because Fifth Third loses deposits and must rely on more expensive sources of funding. Also, customers typically move money from bank deposits to alternative investments during rising interest rate environments. Customers may also move noninterest-bearing deposits to interest-bearing accounts increasing the cost of those deposits. Checking and savings account balances and other forms of customer deposits may decrease when customers perceive alternative investments, such as the stock market, as providing a better risk/return trade-off. Fifth Third's bank customers could take their money out of the Bank and put it in alternative investments, causing Fifth Third to lose a lower-cost source of funding. Higher funding costs reduce Fifth Third's net interest margin and net interest income.
Debt & Financing - Risk 3
Deteriorating credit quality has adversely impacted Fifth Third in the past and may adversely impact Fifth Third in the future.When Fifth Third lends money or commits to lend money, the Bancorp incurs credit risk, or the risk of loss if borrowers do not repay their loans, leases, credit cards, derivative obligations or other credit obligations. The performance of these credit portfolios significantly affects the Bancorp's financial results and condition, including the level of credit losses and reserves for credit losses. Fifth Third's credit risk and credit losses can increase if its loans are concentrated among individual borrowers, borrowers engaged in the same or similar activities, industries or geographies, or to borrowers who as a group may be uniquely or disproportionately affected by economic or market conditions. Refer to the Credit Risk Management subsection of the Risk Management section in Item 7 of this Annual Report for more information on specific concentrations.
Fifth Third reserves for expected credit losses by establishing an allowance for credit losses through a charge to earnings. The amount of this allowance is based on Fifth Third's assessment of credit losses expected to be incurred in the credit portfolios, including unfunded commitments, and requires difficult, subjective and complex judgments about the environment, including analysis of economic or market conditions that may impair the ability of borrowers to repay their loans. Fifth Third may underestimate the credit losses expected to be incurred in its portfolios and have credit losses in excess of the amount reserved. Alternatively, Fifth Third may increase the reserve because of changing economic or market conditions, including inflation, interest rate fluctuations, higher unemployment, or other factors such as changing protections in credit agreements or changes in borrowers' behavior. Fifth Third believes that both the ALLL and reserve for unfunded commitments are adequate to cover expected losses at December 31, 2025. However there is no assurance that they will be sufficient to cover all potential future credit losses associated with exposures existing at December 31, 2025, especially if economic conditions decline.
Debt & Financing - Risk 4
Problems encountered by other financial institutions could adversely affect financial markets generally and have direct and indirect adverse effects on Fifth Third.Fifth Third has exposure to counterparties in the financial services industry and other industries and routinely executes transactions with such counterparties, which may expose Fifth Third to credit risk in the event of default of a counterparty or client. In addition, Fifth Third's credit risk may be affected when the collateral it holds cannot be realized or is liquidated at prices not sufficient to recover the full amount of the loan or derivative exposure. The commercial soundness of many financial institutions may be closely interrelated as a result of credit, trading, clearing or other relationships between the institutions. As a result, concerns about, or a default or threatened default by, one institution could lead to significant market-wide liquidity and credit problems, losses or defaults by other institutions. This is sometimes referred to as systemic risk and may adversely affect financial intermediaries, such as clearing agencies, clearing houses, banks, securities firms and exchanges, with which the Bancorp interacts on a daily basis, and therefore could adversely affect Fifth Third.
Debt & Financing - Risk 5
Changes in interest rates could affect Fifth Third's income and cash flows.Fifth Third's income and cash flows depend to a great extent on the difference between the interest rates earned on interest-earning assets such as loans and investment securities and the interest rates paid on interest-bearing liabilities such as deposits and borrowings. These rates are highly sensitive to many factors that are beyond Fifth Third's control, including general economic conditions in the U.S. or abroad and the policies of various governmental and regulatory agencies (in particular, the FRB). Changes in monetary policy, including changes in interest rates and inflation, could influence the origination of loans, the prepayment speed of loans, the purchase of investments, the generation of deposits and the rates received on loans and investment securities and paid on deposits or other sources of funding as well as customers'ability to repay loans. For example, a tightening of the money supply by the FRB could reduce the demand for a borrower's products and services. This could adversely affect the borrower's earnings and ability to repay a loan, which could have a material adverse effect on Fifth Third's financial condition and results of operations. The impact of these changes may be magnified if Fifth Third does not effectively manage the relative sensitivity of its assets and liabilities to changes in market interest rates. Fluctuations in these areas may adversely affect Fifth Third, its customers and its shareholders. Fifth Third cannot predict the nature or timing of future changes in monetary policies or the precise effects that they may have on Fifth Third's activities and financial results.
Debt & Financing - Risk 6
If an orderly liquidation of a systemically important BHC or non-bank financial company were triggered, Fifth Third could face assessments for the Orderly Liquidation Fund.Dodd-Frank created authority for the orderly liquidation of systemically important BHCs and non-bank financial companies and is based on the FDIC's bank resolution model. The Secretary of the U.S. Treasury may trigger liquidation under this authority only after consultation with the President of the United States and after receiving a recommendation from the board of directors of the FDIC and the FRB upon a two-thirds vote. Liquidation proceedings will be funded by the Orderly Liquidation Fund, which will borrow from the U.S. Treasury and impose risk-based assessments on covered financial companies. Risk-based assessments would be made, first, on entities that received more in the resolution than they would have received in the liquidation to the extent of such excess and second, if necessary, on, among others, BHCs with total consolidated assets of $50 billion or more, such as Fifth Third. Any such assessments may adversely affect Fifth Third's business, financial condition or results of operations.
Corporate Activity and Growth8 | 18.2%
Corporate Activity and Growth - Risk 1
Fifth Third's framework for managing risks may not be effective in mitigating its risk and loss.Corporate Activity and Growth - Risk 2
Fifth Third may sell certain businesses or investments but such sales may not yield desired gains or equity increases. Additionally, lost income from these sales could have an adverse effect on its future earnings and growth.Fifth Third owns, or owns a minority stake in, as applicable, several businesses, investments and other assets that, in the future, may no longer be aligned with Fifth Third's strategic plans or regulatory expectations. If Fifth Third were to sell one or more of its businesses or investments, it would be subject to market forces that may affect the timing or pricing of such sale or result in an unsuccessful sale. If Fifth Third were to complete the sale of any of its businesses, investments and/or interests in third parties, it would lose the income from the sold businesses and/or interests, including those accounted for under the equity method of accounting, and such loss of income could have an adverse effect on its future earnings and growth. Additionally, Fifth Third may encounter difficulties in separating the operations of any businesses it sells, which may affect its business or results of operations.
Corporate Activity and Growth - Risk 3
Difficulties in identifying suitable acquisition or investment opportunities, integrating acquisitions, or evaluating or entering into strategic investments and relationships may hinder Fifth Third from achieving the expected benefits from these acquisitions, investments or relationships.Inherent uncertainties exist when identifying, assessing, acquiring or integrating the operations of another business or investment or relationship opportunity. Fifth Third may not be able to fully achieve its strategic objectives and planned operating efficiencies relevant to an acquisition or strategic relationship. In addition, the markets and industries in which Fifth Third and its potential acquisition and investment targets operate are highly competitive. Acquisition or investment targets may lose customers or otherwise perform poorly or unprofitably, or in the case of an acquired business or strategic relationship, cause Fifth Third to lose customers or perform poorly or unprofitably. Future acquisition and investment activities and efforts to monitor newly acquired businesses or reap the benefits of a new strategic relationship may require Fifth Third to devote substantial time and resources and may cause these acquisitions, investments and relationships to be unprofitable or cause Fifth Third to be unable to pursue other business opportunities.
Fifth Third may also not realize the expected benefits of the acquisition due to lower financial results pertaining to the acquired entity or assets. Additionally, acquired companies or businesses may increase Fifth Third's risk of regulatory action or restrictions related to the operations of the acquired business.
Corporate Activity and Growth - Risk 4
Fifth Third may not be able to effectively manage organizational changes and implement key initiatives in a timely fashion, or at all, due to competing priorities which could adversely affect its business, financial condition, results of operations and reputation.Fifth Third is subject to rapid changes in technology, regulation and product innovation, and faces intense competition for customers, sources of revenue, capital, services, qualified employees and other essential business resources. In order to meet these challenges, Fifth Third is or may be engaged in numerous critical strategic initiatives at the same time. Accomplishing these initiatives may be complex, time intensive and require significant financial, technological, management and other resources. These initiatives may consume management's attention and may compete for limited resources. In addition, organizational changes may need to be implemented throughout Fifth Third as a result of the new products, services, partnerships and processes that arise from the execution of these various strategic initiatives. Fifth Third may have difficulty managing these organizational changes and executing these initiatives effectively in a timely fashion, or at all. Fifth Third's failure to do so could expose it to litigation or regulatory action and may damage Fifth Third's business, financial condition, results of operations and reputation.
Corporate Activity and Growth - Risk 5
Fifth Third expects to incur substantial expenses related to the Comerica Merger and to the integration of Comerica.Fifth Third has incurred and expects to incur a number of costs associated with the Comerica Merger and the integration of Comerica. These costs include financial advisory, legal, accounting, consulting and other advisory fees, severance/employee benefit-related costs, public company filing fees and other regulatory fees and financial printing and other related costs. There are also a large number of processes, policies, procedures, operations, technologies and systems that need to be integrated. Fifth Third will also dedicate resources toward meeting the higher regulatory and supervisory standards applicable to Category III bank holding companies, a classification that was not applicable to Fifth Third prior to the completion of the Comerica Merger.
While Fifth Third has assumed that a certain level of costs will be incurred, there are many factors beyond its control that could affect the total amount or the timing of the integration expenses. Moreover, many of the expenses that Fifth Third will incur are, by their nature, difficult to estimate accurately. Fifth Third expects these expenses will, particularly in the near term, exceed the savings achieved from the elimination of duplicative expenses and the realization of economies of scale. These integration expenses will result in charges against earnings as a result of the Comerica Merger or the integration of Comerica, and the amount and timing of such charges are uncertain at present.
Corporate Activity and Growth - Risk 6
Fifth Third may fail to realize all of the anticipated benefits of the Comerica Merger, or those benefits may take longer to realize than expected due to factors that may be outside Fifth Third's or Comerica's control. Fifth Third may also encounter significant difficulties in integrating Comerica.Fifth Third may fail to realize the anticipated benefits of the Comerica Merger, including, among other things, anticipated revenue and cost synergies, due to factors that may be outside either party's control, including, but not limited to, changes in laws or regulations or in the interpretation of existing laws or regulations, whether caused by a change in government or otherwise, or general economic, political, legislative or regulatory conditions, adverse developments in political or community sentiment, the outcome of any legal or regulatory proceedings that may be currently pending or later instituted against Fifth Third, and known or potential unknown contingencies and liabilities of Comerica assumed in connection with the consummation of the Comerica Merger.
The success of the Comerica Merger, including anticipated benefits and cost savings, will depend, in part, on Fifth Third's ability to successfully integrate Comerica's operations in a manner that results in various benefits and that permits growth opportunities, including among other things, enhanced revenues and revenue synergies, an expanded market reach and operating efficiencies, and does not materially disrupt existing customer relationships of Fifth Third or Comerica or result in decreased revenues due to loss of customers. There is a risk of potential failures, outages, interruptions and other disruptions resulting from the integration of certain systems, networks, infrastructures and related technology. The success of the Comerica Merger also depends on Fifth Third's ability to successfully integrate Comerica into its compliance systems and corporate culture, which Fifth Third believes requires extensive investment.
There can be no assurance that Fifth Third will be able to accurately anticipate and respond to the changing demands it will face as it continues to expand its operations or that it will be able to achieve further growth at all. Additionally, Fifth Third faces risks that any business, technology, service or product it integrates from Comerica in connection with the Comerica Merger may significantly under-perform relative to its expectations, and that Fifth Third may not achieve the benefits it expects, which could, among other things, also result in a write-down of goodwill and other intangible assets associated with the Comerica Merger.
If Fifth Third fails to realize the anticipated benefits of the Comerica Merger, or if those benefits take longer to realize than expected, it could have an adverse effect on its business, financial condition and results of operations.
Corporate Activity and Growth - Risk 7
Fifth Third's future results may suffer if Fifth Third does not effectively manage its expanded operations following the Comerica Merger.Following the Comerica Merger, the size and scope of Fifth Third's business will increase beyond its current size and scope. Fifth Third's future success depends, in part, upon the ability to manage its expanded businesses, which will pose substantial challenges for management, including challenges related to the management of new employees and monitoring of new operations and associated increased costs and complexity. There can be no assurances Fifth Third will be successful or that Fifth Third will realize the expected operating efficiencies, cost savings and other benefits currently anticipated from the Comerica Merger.
In addition, following the Comerica Merger, Fifth Third may be subject to increased scrutiny by, and/or additional regulatory requirements of, governmental authorities as a result of the Comerica Merger or the size, scope and complexity of Fifth Third's business operations, which may have an adverse effect on Fifth Third's business, operations or stock price.
Corporate Activity and Growth - Risk 8
Following completion of the Comerica Merger, Fifth Third may be subject to business uncertainties that could adversely affect Fifth Third's business and operations.As a result of the Comerica Merger, existing customers, suppliers and other business partners of Fifth Third and of Comerica could decide to no longer do business with Fifth Third, reducing its anticipated benefits. Employee attrition could delay or disrupt the integration process. A loss of key personnel or material erosion of employee morale could have a materially adverse effect on Fifth Third's ability to meet customer expectations, thereby adversely affecting business and results of operations. The failure to retain members of Fifth Third's management team and other key personnel could also impair its ability to execute its strategy and implement operational initiatives, thereby having a material adverse effect on its financial condition and results of operation. It is possible that the integration process could result in the disruption of Fifth Third's ongoing businesses or cause inconsistencies in standards, controls, procedures and policies that adversely affect the ability of Fifth Third to maintain relationships with customers and employees or to achieve anticipated benefits of the Comerica Merger.
Macro & Political
Total Risks: 6/44 (14%)Above Sector Average
Economy & Political Environment2 | 4.5%
Economy & Political Environment - Risk 1
Weakness in the U.S. economy, including within Fifth Third's geographic footprint, has adversely affected Fifth Third in the past and may adversely affect Fifth Third in the future.Economy & Political Environment - Risk 2
Global and domestic political, social, economic and public health uncertainties and changes may adversely affect Fifth Third.Global financial markets, including the U.S., face political and economic uncertainties (such as recent budget deficit concerns and political conflict over legislation to raise the U.S. government's debt limit or a prolonged government shutdown) that may delay investment and hamper economic activity. International events such as trade disputes, separatist movements, leadership changes and political and military conflicts could adversely affect global financial activity and markets and could negatively affect the U.S. economy. The impact of widespread health emergencies may also adversely impact global markets and Fifth Third's operations. If its borrowers are adversely affected due to a widespread health emergency that impacts Fifth Third employees, vendors or economic growth generally, Fifth Third's results of operations and financial condition could be adversely affected. Worldwide financial markets have recently experienced periods of extraordinary disruption and volatility, which have been driven by geopolitical events that have resulted in heightened credit risk, reduced valuation of investments, decreased economic activity, heightened risk of cyber-attacks and inflation. Changes in trade policies by the U.S. or other countries, such as tariffs or retaliatory tariffs, may cause inflation which could impact the prices of products sold by the Bancorp's borrowers and have the potential to reduce demand for their products impacting their profitability and making it difficult for its borrowers to repay their loans. Moreover, many companies have experienced reduced liquidity and uncertainty as to their ability to raise capital during such periods of market disruption and volatility. Additionally, in recent years, the FRB and other major central banks have removed or reduced monetary accommodation and raised interest rates (although offset by recent rate reductions), increasing the risk of recession and may also negatively impact asset values and credit spreads that were impacted by extraordinary monetary stimulus. These potential negative effects on financial markets and economic activity could lead to reduced revenues, increased costs, increased credit risks and volatile markets, could adversely impact Fifth Third's ability to raise liquidity via money and capital markets and could negatively impact Fifth Third's business, financial condition and results of operations. In the event that these conditions recur or result in a prolonged economic downturn, Fifth Third's financial position, results of operations and/or liquidity could be materially and adversely affected. These market conditions may affect the Bancorp's ability to access debt and equity capital markets. In addition, as a result of recent financial and political events, Fifth Third may face increased regulation.
Natural and Human Disruptions1 | 2.3%
Natural and Human Disruptions - Risk 1
Severe weather events may impact Fifth Third's loan portfolio and operations.Capital Markets3 | 6.8%
Capital Markets - Risk 1
Changes and trends in the capital markets may affect Fifth Third's income and cash flows.Capital Markets - Risk 2
Changes in the market could impact Fifth Third's mortgage banking business.Fifth Third earns revenue from the fees it receives for originating mortgage loans and for servicing mortgage loans. When rates rise, the demand for mortgage loans tends to fall, reducing the revenue Fifth Third receives from loan originations. At the same time, revenue from mortgage servicing rights ("MSRs") can increase through increases in fair value. When rates fall, mortgage originations tend to increase and the value of MSRs tends to decline, also with some offsetting revenue effect. Even though the origination of mortgage loans can act as a natural hedge, the hedge is not perfect, either in amount or timing. For example, the negative effect on revenue from a decrease in the fair value of residential MSRs is immediate, but any offsetting revenue benefit from more originations and the MSRs relating to the new loans would accrue over time. It is also possible that even if interest rates were to fall, mortgage originations may also fall or any increase in mortgage originations may not be enough to offset the decrease in the MSRs value caused by the lower rates.
Fifth Third typically uses derivatives and other instruments to hedge its mortgage banking interest rate and price risks. Fifth Third generally does not hedge all of its risks and the fact that Fifth Third attempts to hedge any of the risks does not mean Fifth Third will be successful. Hedging is a complex process, requiring sophisticated models and constant monitoring. Fifth Third may use hedging instruments tied to U.S. Treasury rates, SOFR or other benchmarks that may not perfectly correlate with the value or income being hedged. Fifth Third could incur significant losses from its hedging activities. There may be periods where Fifth Third elects not to use derivatives and other instruments to hedge mortgage banking interest rate and price risks.
Market conditions can also affect Fifth Third's contractual obligations related to residential mortgage loans sold to various parties, including government-sponsored enterprises and other financial institutions for investment or private-label securitization. If Fifth Third breaches contractual representations or warranties and does not remedy the breach within a specified period, it may be required to repurchase loans, indemnify the securitization trust, investor, or insurer, or reimburse them for credit losses. As a result, Fifth Third has established reserves for probable losses related to sold loans; however, if economic conditions or the housing market deteriorate, or if repurchase demands and Fifth Third's success in appealing such requests differ from expectations, repurchase obligations and loss severity could increase, requiring material additions to reserves. There can be no assurance that reserves will be adequate or that losses will not have a material adverse effect on Fifth Third's financial condition or results of operations.
Capital Markets - Risk 3
Inability to refinance in public or private capital markets could cause a default that impacts Fifth Third borrowers.Some Fifth Third customers rely on additional sources of capital from outside the Bancorp. If public or private capital markets are disrupted or unavailable to these borrowers such that they cannot obtain funds for refinancing, those borrowers may experience a shortfall that would leave them unable to honor short-term and/or long-term obligations to the Bancorp.
Tech & Innovation
Total Risks: 5/44 (11%)Above Sector Average
Trade Secrets1 | 2.3%
Trade Secrets - Risk 1
Fifth Third could suffer from unauthorized use of intellectual property.Cyber Security1 | 2.3%
Cyber Security - Risk 1
Fifth Third and its service providers are exposed to cybersecurity risks, including risk of cyber-attacks and other information security breaches, which create both operational and reputational risk for the Bank and its customers across all lines of business.Technology3 | 6.8%
Technology - Risk 1
Fifth Third's business is dependent on the availability and performance of operational and information technology systems, including those provided by third-party service providers. Interruptions or failures could materially adversely affect operations.Technology - Risk 2
Fifth Third may not be able to successfully implement future information technology system enhancements, which could adversely affect Fifth Third's business operations and profitability.Fifth Third invests significant resources in information technology system enhancements in order to provide functionality and security at an appropriate level for ongoing product development and process re-engineering. Fifth Third may not be able to acquire or protect rights to its licensed or owned intellectual property or successfully implement and integrate future system enhancements, which could adversely impact the ability to provide timely and accurate financial information in compliance with legal and regulatory requirements, which could result in sanctions from regulatory authorities. Such sanctions could include fines and result in reputational harm and have other negative effects. Failure to properly utilize system enhancements that are implemented in the future could result in impairment charges that adversely impact
Fifth Third's financial condition and results of operations and could result in significant costs to remediate or replace the defective components. In addition, Fifth Third may become involved in licensing disputes or other litigation related to intellectual property or incur significant training, licensing, maintenance, consulting, depreciation expense and amortization expenses during and after systems implementations, and any such costs may continue for an extended period of time. A failure to maintain or enhance Fifth Third's competitive position with respect to technology, whether because of a failure to anticipate client expectations or other necessary changes, a failure in the performance of technological developments or an untimely roll out of developments, may cause Fifth Third to lose market share or incur additional expense.
Technology - Risk 3
New technological advancements, such as AI, may subject Fifth Third to additional risks.The financial services industry is continually undergoing rapid technological change with frequent introductions of new technology-driven products and services, and an established and growing demand for mobile and other phone and computer banking applications. Fifth Third's future success depends, in part, upon Fifth Third's ability to address the needs of its customers by using technology to provide products and services that will satisfy customer demands, as well as to create additional efficiencies in its operations. Fifth Third's competitors may have substantially greater resources to invest in technological improvements. Fifth Third may not be able to effectively implement new technology driven products and services or be successful in marketing these products and services to its customers. Failure to successfully keep pace with technological change affecting the financial services industry could have a material adverse effect on Fifth Third's business, financial condition and results of operations.
Further, Fifth Third may utilize new technology, such as AI, in connection with its business and operations. AI may be developed internally by Fifth Third, or may be provided to Fifth Third by third- or fourth-party service providers. Any such new technology could have a significant impact on the effectiveness of Fifth Third's system of internal controls. Failure to successfully manage these risks in the development and implementation of new lines of business, products or services and/or technologies could have a material adverse effect on Fifth Third's business, financial condition and results of operations.
AI may introduce Fifth Third to novel or intensified legal, regulatory, ethical, operational, reputational or other risks. AI models employed by Fifth Third or its service providers might be flawed due to improper design, implementation, or training or outputs based on data or algorithms that are incomplete, inadequate, misleading, biased or of poor quality. These flaws may not be easily identifiable. Additionally, there is no certainty that Fifth Third's use of AI will successfully enhance its business operations or achieve its intended outcomes, and its competitors may adopt AI more swiftly or effectively than Fifth Third does.
AI usage is subject to a range of existing laws and regulations. AI is also expected to be governed by new laws and regulations, or new applications of existing laws and regulations. AI is under ongoing scrutiny by various governmental and regulatory bodies, with federal, state and international authorities either implementing or considering legal frameworks that could impact Fifth Third's ability to leverage AI effectively. Fifth Third may find it challenging to predict and adapt to these rapidly evolving legal requirements. Additionally, if Fifth Third does not possess adequate rights to the data or algorithms underpinning its AI solutions, or the outputs they generate, Fifth Third could face liabilities for breaching applicable laws and regulations. The limited experience with novel AI algorithms or applications within financial services generally, coupled with the swift pace of technological advancements and the rapid adoption of AI by Fifth Third's partners and competitors, may hinder Fifth Third's ability to effectively mitigate or detect these risks. Any perceived or actual shortcomings in addressing AI-related concerns could adversely affect Fifth Third's business and operations.
Legal & Regulatory
Total Risks: 5/44 (11%)Below Sector Average
Regulation3 | 6.8%
Regulation - Risk 1
Fifth Third is subject to various regulatory requirements that may limit its operations and potential growth.Regulation - Risk 2
As a regulated entity, the Bancorp is subject to certain capital requirements that may limit its operations, potential growth and ability to pay or increase dividends on its common stock or to repurchase its capital stock.The Bancorp must maintain certain risk-based and leverage capital ratios as required by the FRB which can change depending upon general economic conditions and the Bancorp's particular condition, risk profile and growth plans. Compliance with the capital requirements, including leverage ratios, may limit operations that require the intensive use of capital and could adversely affect the Bancorp's ability to expand or maintain present business levels.
Failure by the Bank to meet applicable capital requirements could subject it to a variety of enforcement actions available to regulatory authorities. These include limitations on the ability of the Bancorp to pay dividends and/or repurchase shares, the issuance by the regulatory authority of a capital directive to increase capital, loss of FHC status and the termination of deposit insurance by the FDIC.
The Bancorp is subject to the stress capital buffer requirement and must maintain capital ratios above its buffered minimum (regulatory minimum plus stress capital buffer) in order to avoid certain limitations on capital distributions and discretionary bonuses to executive officers. Further changes to applicable capital and liquidity requirements could result in unexpected or new limitations on the Bancorp's ability to pay dividends and engage in share repurchases.
Regulation - Risk 3
Fifth Third is subject to extensive governmental regulation which could adversely impact Fifth Third or the businesses in which Fifth Third is engaged.Government regulation and legislation subject Fifth Third to restrictions, oversight and/or costs that may have an impact on Fifth Third's business, financial condition, results of operations or the price of its common stock.
Fifth Third is subject to extensive federal and state regulation, supervision and legislation that govern almost all aspects of its operations and limit the businesses in which Fifth Third may engage. This includes many regulations related to Fifth Third's banking, investment banking, securities underwriting, market making, investment management and retail and institutional brokerage services businesses offered through the Bancorp's subsidiaries. These laws and regulations may change from time to time and are primarily intended for the protection of consumers, borrowers and depositors and are not designed to protect security-holders. Compliance with these laws and regulations has resulted in and will continue to result in additional costs, which could be significant, and may have a material and adverse effect on Fifth Third's results of operations. In addition, if Fifth Third does not comply with applicable legislation and regulations, Fifth Third may be subject to litigation, fines, penalties or judgments, or material regulatory restrictions on its businesses, which could adversely affect operations and, in turn, financial results, or that materially adversely affect its shareholders. Future changes in laws or regulations or their interpretations or enforcement may also be materially adverse to Fifth Third and its shareholders or may require Fifth Third to expend significant time and resources to comply with such requirements. Similarly, the impact of domestic and international events related to financial crime such as fraud, money laundering and economic sanctions will continue to be an area of constant change, risk and regulatory focus which pose ongoing regulatory, compliance, operational and financial risks.
Fifth Third cannot predict whether or what pending or future legislation will be adopted or the impact of any such new legislation on Fifth Third. Changes in regulation and supervisory and enforcement focus could affect Fifth Third in a substantial way and could have an adverse effect on its business, financial condition and results of operations. Additionally, legislation or regulatory reform could affect the behaviors of third parties that Fifth Third deals within the course of business, such as rating agencies, insurance companies and investors.
Bank failures may create market volatility and regulatory uncertainty which could have a material adverse effect on Fifth Third's business and financial condition. In addition, changes in laws or regulations that affect Fifth Third's customers and business partners could negatively affect Fifth Third's revenues and expenses. Certain changes in laws or regulations such as tax law reforms that impose limitations on the deductibility of interest may decrease the demand for Fifth Third's products or services and could negatively affect its financial condition and results of operations. Heightened standards under new laws or regulations may result in increased obligations and compliance costs, may result in supervisory or enforcement action, and may factor into Fifth Third's ability to expand services and/or engage in new activities. Other changes in laws or regulations could cause Fifth Third's third-party service providers and other vendors to increase prices and negatively affect Fifth Third's expenses and financial results.
Environmental / Social2 | 4.5%
Environmental / Social - Risk 1
Fifth Third and/or its affiliates are or may become involved from time to time in information-gathering requests, investigations and litigation, regulatory or other enforcement proceedings by various governmental regulatory agencies and law enforcement authorities, as well as self-regulatory agencies, which may lead to adverse consequences.Environmental / Social - Risk 2
Fifth Third is subject to environmental, social and governance risks that could adversely affect its reputation, the trading price of its common stock and/or its business, operations and earnings.There is continued focus, including from governmental organizations, regulators, investors, customers and other stakeholders, on environmental, social, governance and sustainability issues. Laws and regulations related to these issues continue to rapidly evolve. These laws and regulations may impose additional compliance or disclosure obligations on Fifth Third. Failure to adapt to or comply with regulatory requirements or investor or stakeholder expectations and standards could negatively impact Fifth Third's reputation, ability to do business with certain partners, access to capital and its stock price.
States throughout Fifth Third's footprint have taken actions or proposed measures to limit the state's ability to do business with financial institutions or other businesses identified as discriminating against certain industries or practices based on environmental or social criteria. Activist groups and state officials have targeted firms with public criticism and penalties either for engaging in, or not engaging in, certain environmental, social or governance practices or principles. Although Fifth Third has a defined risk-based approach for client selection, Fifth Third could be inherently exposed to reputational, financial and legal risk, and its ability to retain and attract customers and employees may be negatively impacted as a result of contrasting opinions about how a financial institution should address these issues.
Ability to Sell
Total Risks: 5/44 (11%)Above Sector Average
Competition1 | 2.3%
Competition - Risk 1
If Fifth Third does not respond to intense competition and rapid changes in the financial services industry or otherwise adapt to changing customer preferences, its financial performance may suffer.Demand1 | 2.3%
Demand - Risk 1
Industry adoption of real-time payments networks could negatively impact financial performance through reductions in product profitability, increased liquidity reserves and the potential for increased fraud losses, among other risks.Sales & Marketing2 | 4.5%
Sales & Marketing - Risk 1
Changes in retail distribution strategies and consumer behavior may adversely impact Fifth Third's investments in its bank premises and equipment and other assets and may lead to increased expenditures to change its retail distribution channel.Sales & Marketing - Risk 2
Fifth Third may experience losses related to fraud, theft or violence.Fifth Third has experienced, and may experience again in the future, losses incurred due to customer or employee fraud, theft or physical violence. Additionally, physical violence may negatively affect Fifth Third's key personnel, facilities or systems. These losses may be material and negatively affect Fifth Third's financial condition, results of operations or prospects or lead to significant reputational risks and other effects. The industry fraud threat continues to evolve, including but not limited to strategies such as card fraud, check fraud, electronic fraud, wire fraud, social engineering, the use of AI for impersonation and other schemes, malware and phishing attacks for identity theft and account takeover. Fifth Third continues to invest in fraud prevention in the forms of people and systems designed to prevent, detect and mitigate the customer and financial impacts.
Brand / Reputation1 | 2.3%
Brand / Reputation - Risk 1
Damage to Fifth Third's reputation could harm its business.Production
Total Risks: 2/44 (5%)Below Sector Average
Employment / Personnel1 | 2.3%
Employment / Personnel - Risk 1
Fifth Third could suffer if it fails to attract and retain skilled personnel.Costs1 | 2.3%
Costs - Risk 1
Deposit insurance premiums levied against the Bank could increase.See a full breakdown of risk according to category and subcategory. The list starts with the category with the most risk. Click on subcategories to read relevant extracts from the most recent report.
FAQ
What are “Risk Factors”?
Risk factors are any situations or occurrences that could make investing in a company risky.
The Securities and Exchange Commission (SEC) requires that publicly traded companies disclose their most significant risk factors. This is so that potential investors can consider any risks before they make an investment.
They also offer companies protection, as a company can use risk factors as liability protection. This could happen if a company underperforms and investors take legal action as a result.
It is worth noting that smaller companies, that is those with a public float of under $75 million on the last business day, do not have to include risk factors in their 10-K and 10-Q forms, although some may choose to do so.
How do companies disclose their risk factors?
Publicly traded companies initially disclose their risk factors to the SEC through their S-1 filings as part of the IPO process.
Additionally, companies must provide a complete list of risk factors in their Annual Reports (Form 10-K) or (Form 20-F) for “foreign private issuers”.
Quarterly Reports also include a section on risk factors (Form 10-Q) where companies are only required to update any changes since the previous report.
According to the SEC, risk factors should be reported concisely, logically and in “plain English” so investors can understand them.
How can I use TipRanks risk factors in my stock research?
Use the Risk Factors tab to get data about the risk factors of any company in which you are considering investing.
You can easily see the most significant risks a company is facing. Additionally, you can find out which risk factors a company has added, removed or adjusted since its previous disclosure. You can also see how a company’s risk factors compare to others in its sector.
Without reading company reports or participating in conference calls, you would most likely not have access to this sort of information, which is usually not included in press releases or other public announcements.
A simplified analysis of risk factors is unique to TipRanks.
What are all the risk factor categories?
TipRanks has identified 6 major categories of risk factors and a number of subcategories for each. You can see how these categories are broken down in the list below.
1. Financial & Corporate
- Accounting & Financial Operations - risks related to accounting loss, value of intangible assets, financial statements, value of intangible assets, financial reporting, estimates, guidance, company profitability, dividends, fluctuating results.
- Share Price & Shareholder Rights – risks related to things that impact share prices and the rights of shareholders, including analyst ratings, major shareholder activity, trade volatility, liquidity of shares, anti-takeover provisions, international listing, dual listing.
- Debt & Financing – risks related to debt, funding, financing and interest rates, financial investments.
- Corporate Activity and Growth – risks related to restructuring, M&As, joint ventures, execution of corporate strategy, strategic alliances.
2. Legal & Regulatory
- Litigation and Legal Liabilities – risks related to litigation/ lawsuits against the company.
- Regulation – risks related to compliance, GDPR, and new legislation.
- Environmental / Social – risks related to environmental regulation and to data privacy.
- Taxation & Government Incentives – risks related to taxation and changes in government incentives.
3. Production
- Costs – risks related to costs of production including commodity prices, future contracts, inventory.
- Supply Chain – risks related to the company’s suppliers.
- Manufacturing – risks related to the company’s manufacturing process including product quality and product recalls.
- Human Capital – risks related to recruitment, training and retention of key employees, employee relationships & unions labor disputes, pension, and post retirement benefits, medical, health and welfare benefits, employee misconduct, employee litigation.
4. Technology & Innovation
- Innovation / R&D – risks related to innovation and new product development.
- Technology – risks related to the company’s reliance on technology.
- Cyber Security – risks related to securing the company’s digital assets and from cyber attacks.
- Trade Secrets & Patents – risks related to the company’s ability to protect its intellectual property and to infringement claims against the company as well as piracy and unlicensed copying.
5. Ability to Sell
- Demand – risks related to the demand of the company’s goods and services including seasonality, reliance on key customers.
- Competition – risks related to the company’s competition including substitutes.
- Sales & Marketing – risks related to sales, marketing, and distribution channels, pricing, and market penetration.
- Brand & Reputation – risks related to the company’s brand and reputation.
6. Macro & Political
- Economy & Political Environment – risks related to changes in economic and political conditions.
- Natural and Human Disruptions – risks related to catastrophes, floods, storms, terror, earthquakes, coronavirus pandemic/COVID-19.
- International Operations – risks related to the global nature of the company.
- Capital Markets – risks related to exchange rates and trade, cryptocurrency.