Truist's Transformation Playbook: 15% ROTCE and Revenue Doubling by 2027

The Broader Ambition: Truist Charts a Multiyear Transformation#

When TFC executives took the stage at the BancAnalysts Association of Boston Conference on November 6, they presented a picture of a regional bank in flux—one that has moved decisively beyond the constraints of margin compression and is now staking its future on a calculated, multiyear transformation. Chief Wholesale Banking Officer Kristin Lesher outlined concrete targets: a return on tangible common equity of 15 percent by 2027, a doubling of revenue growth, and a talent acquisition programme that will add more than 300 employees to support the expansion. These are not merely aspirational figures. They represent a significant departure from Truist's baseline position—a regional bank with current return on tangible common equity of 12.2 percent, operating under margin pressure that has compressed net interest margins to 2.66 percent and burdened the efficiency ratio to 83 percent. The conference presentation effectively reframes the October narrative around Truist's One View Connect embedded finance initiative. What was announced then as a pilot programme focused on treasury management and workflow integration is now contextualized as a foundational element of a much larger strategic pivot designed to unlock durably higher returns and accelerate profitable growth across the wholesale banking franchise.

The transition from defensive margin management to offensive growth represents a strategic inflection point for a bank that has historically relied on lending and deposit spreads as its core profit engine. Management's public commitment to these targets signals confidence that the cost-of-capital environment, the deposit market dynamics, and the competitive positioning of wholesale banking have stabilized sufficiently to support an expansion phase. Equally important, the decision to invest heavily in talent acquisition—a programme that will run into the tens of millions of dollars—demonstrates that Truist's leadership believes the growth opportunity is durable and not merely cyclical. For investors accustomed to regional banks playing defense during challenging rate cycles, this shift in posture warrants careful analysis. The question is whether management's ambition is calibrated to Truist's core competencies and execution capacity, or whether it represents an overreach that could dilute returns before any payoff materializes.

The Foundation: One View Connect as Proof of Concept#

One View Connect remains the flagship programme but is now understood as part of a broader portfolio approach to revenue diversification. The embedded finance solution, developed in partnership with fintech specialist Koxa, enables corporate clients to execute treasury functions—payment approvals, reconciliation, Real-Time Payment initiation—directly within their enterprise resource planning systems. This solves a genuine pain point: treasury teams at mid-market and large corporations spend excessive time navigating between banking platforms and corporate software, creating operational friction and increasing error risk. Early pilot results have been encouraging, with participating clients reporting measurable improvements in onboarding speed, data accuracy, and operational efficiency. The commercial logic is straightforward: by embedding Truist's capabilities into workflows that clients already use daily, the bank deepens switching costs, increases engagement depth, and creates a platform for cross-selling adjacent services. Treasury management revenues have already grown 14 percent year-over-year in the most recent quarter, validating underlying client appetite for services that extend beyond transactional lending and deposit products.

What elevates One View Connect from a valuable tactical initiative to a strategic foundation is the underlying economics and scalability characteristics. Treasury management and wholesale banking services generate fee revenue that is structurally less sensitive to interest rate cycles than traditional net interest margin. A recession would dampen transaction volumes and working capital cycles, reducing the absolute size of the fee pool, but the margin structure of fee-based services remains stable across rate regimes. This is the critical distinction. Truist's core profitability has deteriorated as rate cycles have compressed margins on the lending and deposit book. By shifting the revenue mix towards fees, the bank insulates itself from further rate volatility while simultaneously expanding its addressable market beyond the traditional interest-rate-sensitive products that have historically driven earnings. One View Connect is not the entirety of this strategy—it is the visible, articulate expression of it. The conference guidance on revenue doubling and ROTCE targets suggests that management envisions a portfolio of initiatives—potentially including adjacent products in payments, cash management, data analytics, and other value-added wholesale banking services—that collectively drive the earnings accretion needed to reach the 15 percent ROTCE target.

The 2027 Target: Deconstructing the Math#

A 130 basis point improvement in return on tangible common equity—from 12.2 percent to 15 percent—is not trivial. It requires either meaningful earnings growth, a reduction in the common equity base (through buybacks or reduced capital requirements), or a combination of both. Truist's current capital position provides some flexibility. The bank's Common Equity Tier 1 ratio stands at 11.0 percent, significantly above regulatory minimums, and management has already demonstrated discipline in deploying this excess capital. In the second quarter of 2025, Truist returned $1.4 billion to shareholders through buybacks and dividends while maintaining the buffer required for organic growth investment and potential acquisition activity. The path to 15 percent ROTCE likely hinges on three interlocking mechanisms: first, a meaningful shift in the revenue mix towards higher-margin, less capital-intensive fee-based services; second, an improvement in operating efficiency as the 83 percent efficiency ratio normalizes downward through a combination of revenue growth and disciplined expense management; and third, continued disciplined capital allocation that maximizes earnings per share through selective buybacks while preserving optionality for growth investments.

The revenue doubling guidance introduces the most material execution risk in the 2027 ambition. Doubling revenue growth—from the historical low-single-digit percentage growth rates typical of regional banks in a mature, low-growth rate environment to double-digit growth—requires not just market share gains but also the creation of new revenue streams or the meaningful expansion of existing ones. One View Connect can certainly contribute, but the embedded finance market remains nascent and competitive. Stripe, Adyen, and other fintech platforms have established direct relationships with ERP vendors and possess technical agility that traditional banks cannot easily replicate. Truist's advantage lies in its wholesale banking relationships, balance sheet credibility, and the distribution scale provided by its $544 billion asset base. But scaling from a pilot programme in embedded finance to a material contributor to enterprise-wide revenue doubling will require both execution excellence and favorable market conditions. The talent acquisition programme—300 plus new hires—signals management's conviction that the growth opportunity is real. These are likely to be specialists in wholesale banking, fintech integration, and data analytics, disciplines where Truist will need to compete aggressively for talent in a tight labour market. The investment in human capital is both a vote of confidence in the strategy and an acknowledgment that execution at scale will be demanding.

Execution Risk and Competitive Pressure#

Truist's strategic pivot unfolds in a wholesale banking landscape marked by intensifying competition and structural headwinds. Larger banks such as JPM and BNY Mellon have invested billions in fintech capabilities and embedded finance platforms, leveraging their greater scale and capital resources. Meanwhile, fintech specialists continue to encroach on traditional banking functions, disintermediating banks from certain customer relationships and reducing the profitability of transactional services. Truist's strategy—to partner with specialist fintechs like Koxa rather than attempt to build the entire technology stack internally—is pragmatic and recognizes the reality that regional banks cannot match the pace of innovation of pure-play fintech platforms. However, partnership models introduce dependency risks. If Koxa faces competitive pressure or if the partnership fails to deliver expected results, Truist will have limited ability to pivot quickly. The embedded finance competitive landscape is also becoming crowded, with established payment processors and larger regional banks all launching similar capabilities. By the time Truist scales One View Connect beyond the pilot phase, the market may have shifted, newer entrants may have raised barriers to entry, or client preferences may have evolved in ways that diminish the value proposition.

Macroeconomic sensitivity represents another material risk to the 2027 targets. The appeal of treasury management services and working capital optimization depends critically on business activity levels and corporate investment cycles. A recession—whether mild or severe—would dampen corporate treasury transaction volumes, reduce the demand for sophisticated cash management services, and potentially force a repricing of fee services as clients negotiate harder during downturns. Truist's historical experience suggests that wholesale banking fee revenues are vulnerable during economic contraction. The targeting of 15 percent ROTCE by 2027 assumes a benign macroeconomic environment or, at minimum, that any recession that occurs will be sufficiently mild that it does not materially disrupt the revenue and profitability trajectory. Given the elevation in interest rates, the corporate leverage cycle, and geopolitical risks that are present in the external environment, this assumption warrants scrutiny. The ability of management to execute the 300-person talent acquisition programme will also depend on economic conditions. In a tightening labour market, the cost of acquiring specialized talent in fintech and wholesale banking will be high and may constrain the pace of the expansion. In a recession, some of this newly hired talent may prove redundant, requiring costly restructuring.

The Human Factor: Can Legacy Banking Scale Fast Enough?#

The decision to hire 300 plus employees signals management confidence in the growth strategy, but it also highlights a critical vulnerability in Truist's execution model. Large, legacy banking organizations operate with different organizational rhythms and incentive structures than fintech platforms and smaller competitors. Hiring talent from the fintech ecosystem into a traditional banking environment often creates cultural friction. New hires expecting the autonomy, rapid iteration cycles, and equity upside of startups frequently encounter multi-layer approval processes, compliance requirements, and hierarchical decision-making that characterize large financial institutions. The ability to onboard, integrate, and retain this talent while preserving their productivity and motivation will be as important as the hiring itself. Truist's track record on digital transformation provides a mixed signal. The bank has reported strong growth in digital account production—17 percent year-over-year growth in the most recent quarter—suggesting that clients are willing to engage through modern digital channels. However, the 83 percent efficiency ratio indicates that the underlying cost structure remains challenged. The bank has not yet demonstrated the ability to simultaneously grow revenue substantially while meaningfully improving cost efficiency. This is not a Truist-specific problem; it is endemic to legacy banking organizations that must simultaneously run a traditional business and build new capabilities. The 2027 targets implicitly assume that Truist can solve this structural challenge—that it can layer on new businesses and capabilities without the traditional business deteriorating and without cost structure bloating to unsustainable levels.

The leadership of Kristin Lesher, who has stewardship over the wholesale banking franchise, will be central to execution. Lesher has visibility and credibility with the bank's institutional client base, and the BancAnalysts presentation itself was carefully calibrated to position Truist as a bank that is investing aggressively in growth while maintaining disciplined capital allocation. However, individual leadership excellence is necessary but not sufficient. The systems, incentive structures, and organizational capabilities that support the execution of a multiyear transformation of this magnitude must be embedded throughout the organization. This includes alignment between technology, compliance, risk management, and the business lines. It also requires sustained investment in process automation and data infrastructure that can support the scaling of new services. These are not trivial undertakings, and regional banks have historically struggled to execute them at the pace required to maintain competitive momentum.

Outlook#

Investment Thesis and Strategic Catalysts#

Truist's November 6 presentation established a clear thesis for investors: the bank is leveraging its wholesale banking relationships, capital strength, and investment capacity to transform from a legacy regional bank dependent on interest rate cycles into a more diversified, fee-centric institution with higher and more durable returns. The 15 percent ROTCE target by 2027 is ambitious but not impossible if management successfully executes on revenue diversification, efficiency improvement, and disciplined capital allocation. The near-term catalyst is the pace of One View Connect adoption and the contribution of treasury management services to overall revenue growth. Over the next four to eight quarters, investors will be looking for evidence that the embedded finance pilot is gaining traction, that client adoption is accelerating, and that fee revenues are contributing materially to earnings. Longer-term catalysts include the success of the talent acquisition programme in bringing fintech and digital banking expertise into the organization, the development and launch of adjacent wholesale banking services built on the One View Connect platform, and evidence that the bank can simultaneously grow revenues and improve operating efficiency. By 2027, the success or failure of this transformation will be visible in the actual return on tangible common equity and the bank's competitive positioning relative to peers.

The investment case hinges on management's execution capability and the durability of the wholesale banking market opportunity. TFC has demonstrated that it can navigate a challenging interest rate environment without incurring the impairment charges or capital deterioration that have afflicted some of its regional bank peers. The decision to invest proactively in fee-based revenue diversification is sound in principle. However, the path from investment and ambition to realized returns is long and fraught with execution risk. The bank is betting that it can operate at the intersection of traditional banking and modern fintech, a capability that few legacy institutions have successfully demonstrated at scale. Success would signal that Truist can compete not just on relationships and capital availability—the traditional regional bank advantages—but also on product innovation, technology speed, and customer experience. This would be a meaningful inflection point for the institution and would validate the 2027 targets as not merely aspirational but achievable.

Risks, Uncertainties, and Competitive Pressures#

The path to 15 percent ROTCE is lined with identifiable risks that could constrain progress. The fintech competitive landscape continues to evolve at a rapid pace, and the embedded finance space remains unconsolidated and competitive. Stripe, Adyen, and others have advantages in speed and agility, while larger banks benefit from scale. Truist occupies a middle ground where neither advantage is decisive. The integration of the newly hired talent into the organization, and the cultural challenges of blending fintech velocity with banking rigor, represent significant execution risks. If the talent acquisition programme proves more costly than budgeted, or if attrition rates are higher than expected, the economics of the transformation could deteriorate. The macroeconomic environment also poses a material headwind. If a recession arrives within the 2027 timeframe, the demand for treasury management services and working capital optimization will weaken, potentially delaying the revenue doubling targets and the ROTCE improvement. Corporate clients may also press for margin compression on fee services during downturns, further challenging the profitability trajectory. Finally, Truist will need to continuously monitor competitive response from larger banks and fintech platforms. If rivals launch credible competing offers or if the ERP vendors begin to favor direct relationships with fintechs over bank partnerships, the One View Connect value proposition could erode more quickly than management currently anticipates.

The 2027 targets also embed an implicit assumption about capital levels and regulatory requirements. If regulatory capital requirements increase due to macroeconomic stress or changes in prudential policy, Truist's capacity to return capital to shareholders through buybacks while maintaining excess capital for growth investments may be constrained. Conversely, if interest rates decline meaningfully from current levels, the bank's deposit franchise and lending economics could improve, reducing the urgency of the fee-based transformation. These uncertainties are inherent in any multiyear strategic plan in banking, but they underscore the importance of management's ability to adapt and course-correct as circumstances evolve. The confidence that Truist's leadership has expressed in the 2027 targets will be tested not only by the bank's execution capability but also by the external environment in which that execution occurs.