16 BARRON’S September 28, 2020
the SunTrust balance sheet, including its
loans and other assets, was marked to mar-
ket when the merger closed. That trimmed
the value of the loans, for example, provid-
ing another cushion to absorb any loan
losses.
Another benefit of purchase accounting
for Truist: When payments are made on
those former SunTrust loans, they come
through as income on the profit and loss
statement—though that benefit will fade.
More than half of Truist’s $321 billion
loan and lease portfolio is dedicated to
commercial business, including commer-
cial and industrial loans. The rest is on the
consumer side, including residential mort-
gages and lines of credit.
But the macro environment remains
uncertain amid worries about a second
wave of the pandemic and the overall state
of the U.S. economy. “It’s going to hit every-
body, but the credit hit for Truist and the
industry is expected to be less severe than
what it was in the 2008-09 financial cri-
sis,” Cassidy says.
Another pressure point is its net-interest
margin, which was 3.13% in the second
quarter versus 3.58% three months earlier.
As interest rates go lower, it means the
bank earns less on some of its assets, nota-
bly loans and securities.
But Truist still has a few cards to play.
Its average cost of total deposits was
0.22% as of June 30, down from 0.51% on
March 31, and that’s expected to go even
lower over the next three to six months.
On the asset side, “over half of our bor-
rowers on the corporate and commercial
side are allowing us to put interest-rate
floors onto their loans,” says Bible, the
CFO. Helped by strong deposit growth
and excess liquidity, the bank has roughly
$35 billion of cash parked at the Federal
Reserve. While those Fed deposits earn
only 0.10% in interest, some will be
moved into higher-yielding securities, he
says, “and then as the economy recovers,
loan demand will come back at some point
and you will be able to redeploy those in-
vestment cash flows into loans.”
Nash believes Truist can earn around $
a share annually when rates eventually
rise, and potentially more if it can get its
adjusted efficiency ratio into the low 50s
and its adjusted ROTCE to the low 20s—
the company’s targets. “It wouldn’t surprise
me, given the superior returns, to see Tru-
ist trade at a premium to its peers,” says
Nash. The stock was recently trading at
about 10.7 times 2021 earnings, just a slight
premium to peers’ 10.4 times.
If that premium were to expand, it could
put the stock at close to $60 or even higher
in a few years—and the nice yield can help
tide investors over.B
SUMMARYNOTICEOFPROPOSEDCLASSACTIONSETTLEMENT
IfyouenteredintoaU.S.-RelatedTransactioninoronanyover-the-countermarketorexchangeinphysicalsilverorina
derivativeinstrumentinwhichsilveristheunderlyingreferenceassetfromJanuary1,1999throughandincluding
September6,2016(“SettlementClassPeriod”),yourrightsmaybeaffectedbyapendingclassactionsettlement
andyoumaybeentitledtoaportionofthesettlementfund.
ThisSummaryNoticeistoalertyoutoaproposedsettlementtotaling$38,000,000.00reachedwithDeutscheBankAG,DeutscheBankAmericasHolding
Corporation, DB U.S. Financial Markets Holding Corporation, Deutsche Bank Securities, Inc., Deutsche Bank Trust Corporation, Deutsche Bank Trust
CompanyAmericas,DeutscheBankAGNewYorkBranch,andtheirsubsidiariesandaffiliates(collectively“DeutscheBank”).DeutscheBankdeniesany
liability,fault,orwrongdoingofanykindinconnectionwiththeallegationsintheAction. Byenteringintotheproposedsettlement,DeutscheBankhasnot
admittedtoanysuchliability,fault,orwrongdoing,andnothingintheSettlementAgreementorthisNoticeshallbeconstruedassuchanadmission.
The United States District Court for the Southern District of NewYork (the “Court”) authorized this Notice.The Court has appointed the lawyers listed
belowtorepresenttheSettlementClassinthisAction:
WhoIsaMemberoftheSettlementClass?
Subjecttocertainexceptions,theproposedSettlementClassconsistsofallpersonsandentitieswhoorwhichenteredintoaU.S.-RelatedTransaction(1)in
or on any over-the-counter market or exchange in physical silver or (2) in a derivative instrument in which silver is the underlying reference asset
(collectively,“SilverInstruments”)duringtheClassPeriod.
“U.S.-RelatedTransaction”meansanytransactioninaSilverInstrument:(a)byanypersonorentitydomiciledintheU.S.oritsterritories;or(b)byany
personorentitydomiciledoutsidetheU.S.oritsterritoriesbutconducted,inwholeorinpart,intheU.S.oritsterritories.
TheothercapitalizedtermsusedinthisSummaryNoticearedefinedinthedetailedNoticeofProposedClassActionSettlement,April8,2021Fairness
HearingThereonandClassMembers’Rights(“Notice”)andtheSettlementAgreement,whichareavailableatwww.SilverFixSettlement.com.
If you are not sure if you are included in the Settlement Class, you can get more information, including the detailed Notice, at
WhatIsThisLawsuitAboutandWhatDoestheSettlementProvide?
PlaintiffsallegethateachDefendant,includingDeutscheBank,conspiredtodictatethepriceofsilverduringadaily,secret,andunregulatedmeeting(the
“Silver Fix”). Defendants are alleged to have coordinated manipulative silver transactions in advance of the daily Silver Fix call. The alleged goal of
DefendantswastomanipulatetheFixpriceintheirdesireddirection.Defendantsallegedlyagreedtofixthe“bid-askspread”artificiallywiderwhenoffering
tobuyorsellsilverinthepublicsilvermarkettradingwithPlaintiffsandtheClass.Defendantsalsoallegedlyimplementedcoordinatedtradingstrategiesto
manipulateandmaintainthepriceofSilverInstrumentsatartificiallevelsduringtheClassPeriod.Plaintiffshaveassertedlegalclaimsunderthefederal
antitrustlaw,CommodityExchangeAct,andcommonlaw.
Tosettletheclaimsinthislawsuitandwithoutadmittinganyliability,fault,orwrongdoing,DeutscheBankhasagreedtopayatotalof$38million(the
“SettlementFund”)incashforthebenefitoftheproposedSettlementClass.IftheSettlementisapproved,theSettlementFund,plusinterestearnedfromthe
dateitwasestablished,lessanyTaxes,anyNoticeandAdministrationCosts,anyCourt-awardedattorneys’fees,paymentoflitigationcostsandexpenses,
andserviceawardsforPlaintiffs,andanyothercostsorfeesapprovedbytheCourt(the“NetSettlementFund”)willbedividedamongallSettlementClass
MemberswhofilevalidProofsofClaimandRelease.
WillIGetaPayment?
IfyouareamemberoftheSettlementClassanddonotoptout,youwillbeeligibleforapaymentfromtheNetSettlementFundifyoufileaProofofClaim
andRelease(“ClaimForm”).Youalsomayobtainmoreinformationatwww.SilverFixSettlement.comorbycallingtoll-free1-800-254-2939(ifcallingfrom
outsidetheUnitedStatesorCanada,call1-414-961-6577).
ClaimFormsmustbesubmittedonlineatwww.SilverFixSettlement.comonorbefore11:59p.m.Easterntimeon March1,2021OR mailedtoandreceived
bytheSettlementAdministrator,A.B.Databy March1,.
WhatAreMyRights?
IfyouareamemberoftheSettlementClassanddonotoptout,youwillreleasecertainlegalrightsagainstDeutscheBankandtheDBReleasedParties,as
explained in the detailed Notice and SettlementAgreement, which are available at http://www.SilverFixSettlement.com. If you do not want to take part in the
Settlement,youmustoptoutby February11,2021 .YoumayobjecttotheSettlement,DistributionPlan,and/orapplicationforanawardofattorneys’fees,
paymentoflitigationcostsandexpenses,and/orserviceawardsforPlaintiffs.Ifyouwanttoobject,youmustdosoby February11,2021 .Informationon
howtooptoutorobjectiscontainedinthedetailedNotice,whichisavailableatwww.SilverFixSettlement.com.
WhenIstheFairnessHearing?
TheCourtwillholdahearingattheUnitedStatesDistrictCourtfortheSouthernDistrictofNewYork,ThurgoodMarshallUnitedStatesCourthouse,
40 Foley Square, Courtroom 443, New York, NY 10007, on April 8, 2021 at 10:00 A.M. to consider whether to finally approve this Settlement,
DistributionPlan,andapplicationforanawardofattorneys’fees,paymentoflitigationcostsandexpenses,andanyserviceawardsforPlaintiffs.Given
thecurrentCOVID-19situation,theCourtreservestherighttoconductthefinalfairnesshearingremotely.Youoryourlawyermayasktoappearand
speakatthehearingatyourownexpense,butyoudonothaveto.AnychangestothetimeandplaceoftheFairnessHearing,orotherdeadlines,willbe
postedtowww.SilverFixSettlement.comassoonaspracticable.
Formoreinformation,calltoll-free1-800-254-2939(ifcallingfromoutsidetheUnitedStatesorCanada,call1-414-961-6577)
orvisitwww.SilverFixSettlement.com.
_**PleasedonotcalltheCourtortheClerkoftheCourtforinformationabouttheSettlement.**_
RobertEisler
GRANT&EISENHOFERP.A.
485LexingtonAvenue,29thFloor
NewYork,NY
Telephone:(646)722-
VincentBriganti
LOWEYDANNENBERG,P.C.
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Telephone:(914)733-