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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended JuneSeptember 30, 2019

Commission File Number 001-33653

(Exact name of Registrant as specified in its charter)

Fifth Third Center

Cincinnati, Ohio 45263

(Address of principal executive offices)

Registrant’s telephone number, including area code: (800)  972-3030

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐No ☒

Securities registered pursuant to Section 12(b) of the Act:

There were 730,485,823709,667,397 shares of the Registrant’s common stock, without par value, outstanding as of JulyOctober 31, 2019.

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FINANCIAL CONTENTS

FORWARD-LOOKING STATEMENTS

This report contains statements that we believe are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6 promulgated thereunder. These statements relate to our financial condition, results of operations, plans, objectives, future performance or business. They usually can be identified by the use of forward-looking language such as “will likely result,” “may,” “are expected to,” “is anticipated,” “potential,” “estimate,” “forecast,” “projected,” “intends to,” or may include other similar words or phrases such as “believes,” “plans,���” “trend,” “objective,” “continue,” “remain,” or similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” or similar verbs. You should not place undue reliance on these statements, as they are subject to risks and uncertainties, including but not limited to the risk factors set forth in our most recent Annual Report on Form 10-K as updated by our Quarterly Reports on Form 10-Q. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements we may make. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then actually known to us. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors that might cause such a difference include, but are not limited to: (1) deteriorating credit quality; (2) loan concentration by location or industry of borrowers or collateral; (3) problems encountered by other financial institutions; (4) inadequate sources of funding or liquidity; (5) unfavorable actions of rating agencies; (6) inability to maintain or grow deposits; (7) limitations on the ability to receive dividends from subsidiaries; (8) cyber-security risks; (9) Fifth Third’s ability to secure confidential information and deliver products and services through the use of computer systems and telecommunications networks; (10) failures by third-party service providers; (11) inability to manage strategic initiatives and/or organizational changes; (12) inability to implement technology system enhancements; (13) failure of internal controls and other risk management systems; (14) losses related to fraud, theft or violence; (15) inability to attract and retain skilled personnel; (16) adverse impacts of government regulation; (17) governmental or regulatory changes or other actions; (18) failures to meet applicable capital requirements; (19) regulatory objections to Fifth Third’s capital plan; (20) regulation of Fifth Third’s derivatives activities; (21) deposit insurance premiums; (22) assessments for the orderly liquidation fund; (23) replacement of LIBOR; (24) weakness in the national or local economies; (25) global political and economic uncertainty or negative actions; (26) changes in interest rates; (27) changes and trends in capital markets; (28) fluctuation of Fifth Third’s stock price; (29) volatility in mortgage banking revenue; (30) litigation, investigations and enforcement proceedings by governmental authorities; (31) breaches of contractual covenants, representations and warranties; (32) competition and changes in the financial services industry; (33) changing retail distribution strategies, customer preferences and behavior; (34) risks relating to the merger with MB Financial, Inc. and Fifth Third’s ability to realize the anticipated benefits of the merger;merger with MB Financial, Inc.; (35) difficulties in identifying, acquiring or integrating suitable strategic partnerships, investments or acquisitions; (36) potential dilution from future acquisitions; (37) loss of income and/or difficulties encountered in the sale and separation of businesses, investments or other assets; (38) results of investments or acquired entities; (39) changes in accounting standards or interpretation or declines in the value of Fifth Third’s goodwill or other intangible assets; (40) inaccuracies or other failures from the use of models; (41) effects of critical accounting policies and judgments or the use of inaccurate estimates; (42) weather-related events or other natural disasters; and (43) the impact of reputational risk created by these or other developments on such matters as business generation and retention, funding and liquidity.

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Glossary of Abbreviations and Acronyms

Fifth Third Bancorp provides the following list of abbreviations and acronyms as a tool for the reader that are used in Management’s Discussion and Analysis of Financial Condition and Results of Operations, the Condensed Consolidated Financial Statements and the Notes to Condensed Consolidated Financial Statements.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations (Item 2)

The following is Management’s Discussion and Analysis of Financial Condition and Results of Operations of certain significant factors that have affected Fifth Third Bancorp’s (the “Bancorp” or “Fifth Third”) financial condition and results of operations during the periods included in the Condensed Consolidated Financial Statements, which are a part of this filing. Reference to the Bancorp incorporates the parent holding company and all consolidated subsidiaries. The Bancorp’s banking subsidiary is referred to as the Bank.

(a)Amounts presented on an FTE basis. The FTE adjustments for both the three months ended JuneSeptember 30, 2019 and 2018 were $5 and $4 respectively, and for the sixnine months ended JuneSeptember 30, 2019 and 2018 were $9$13 and $7,$12, respectively.

(b)These are non-GAAP measures. For further information, refer to the Non-GAAP Financial Measures section of MD&A.

(c)The provision for credit losses is the sum of the provision for loan and lease losses and the provision for (benefit from) the reserve for unfunded commitments.

(d)The allowance for credit losses is the sum of the ALLL and the reserve for unfunded commitments.

(e)Includes demand deposits, interest checking deposits, savings deposits, money market deposits and foreign office deposits.

(f)Includes transaction deposits and other time deposits.

(g)Includes certificates $100,000 and over, other deposits, federal funds purchased, other short-term borrowings and long-term debt.

(h)Under the U.S. banking agencies’ Basel III Final Rule, assets and credit equivalent amounts of off-balance sheet exposures are calculated according to the standardized approach for risk-weighted assets. The resulting values are added together in the Bancorp’s total risk-weighted assets.

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OVERVIEW

Fifth Third Bancorp is a diversified financial services company headquartered in Cincinnati, Ohio. At JuneSeptember 30, 2019, the Bancorp had $168.8$171.1 billion in assets and operated 1,2071,143 full-service banking centers and 2,5512,487 Fifth Third branded ATMs in ten states throughout the Midwestern and Southeastern regions of the U.S. The Bancorp reports on four business segments: Commercial Banking, Branch Banking, Consumer Lending and Wealth and Asset Management.

This overview of MD&A highlights selected information in the financial results of the Bancorp and may not contain all of the information that is important to you. For a more complete understanding of trends, events, commitments, uncertainties, liquidity, capital resources and critical accounting policies and estimates, you should carefully read this entire document as well as the Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2018. Each of these items could have an impact on the Bancorp’s financial condition, results of operations and cash flows. In addition, refer to the Glossary of Abbreviations and Acronyms in this report for a list of terms included as a tool for the reader of this quarterly report on Form 10-Q. The abbreviations and acronyms identified therein are used throughout this MD&A, as well as the Condensed Consolidated Financial Statements and Notes to Condensed Consolidated Financial Statements.

Net interest income, net interest margin, net interest rate spread and the efficiency ratio are presented in MD&A on an FTE basis. The FTE basis adjusts for the tax-favored status of income from certain loans and securities held by the Bancorp that are not taxable for federal income tax purposes. The Bancorp believes this presentation to be the preferred industry measurement of net interest income as it provides a relevant comparison between taxable and non-taxable amounts. The FTE basis for presenting net interest income is a non-GAAP measure. For further information, refer to the Non-GAAP Financial Measures section of MD&A.

The Bancorp’s revenues are dependent on both net interest income and noninterest income. For the three months ended JuneSeptember 30, 2019, net interest income on an FTE basis and noninterest income provided 65%63% and 35%37% of total revenue, respectively. For the sixnine months ended JuneSeptember 30, 2019, net interest income on an FTE basis and noninterest income provided 57%59% and 43%41% of total revenue, respectively. The Bancorp derives the majority of its revenues within the U.S. from customers domiciled in the U.S. Revenue from foreign countries and external customers domiciled in foreign countries was immaterial to the Condensed Consolidated Financial Statements for both the three and sixnine months ended JuneSeptember 30, 2019. Changes in interest rates, credit quality, economic trends and the capital markets are primary factors that drive the performance of the Bancorp. As discussed later in the Risk Management section of MD&A, risk identification, measurement, monitoring, control and reporting are important to the management of risk and to the financial performance and capital strength of the Bancorp.

Net interest income is the difference between interest income earned on assets such as loans, leases and securities, and interest expense incurred on liabilities such as deposits, other short-term borrowings and long-term debt. Net interest income is affected by the general level of interest rates, the relative level of short-term and long-term interest rates, changes in interest rates and changes in the amount and composition of interest-earning assets and interest-bearing liabilities. Generally, the rates of interest the Bancorp earns on its assets and pays on its liabilities are established for a period of time. The change in market interest rates over time exposes the Bancorp to interest rate risk through potential adverse changes to net interest income and financial position. The Bancorp manages this risk by continually analyzing and adjusting the composition of its assets and liabilities based on their payment streams and interest rates, the timing of their maturities and their sensitivity to changes in market interest rates. Additionally, in the ordinary course of business, the Bancorp enters into certain derivative transactions as part of its overall strategy to manage its interest rate and prepayment risks. The Bancorp is also exposed to the risk of loss on its loan and lease portfolio, as a result of changing expected cash flows caused by borrower credit events, such as loan defaults and inadequate collateral.

Noninterest income is derived from corporate banking revenue, service charges on deposits, corporate banking revenue, wealth and asset management revenue, card and processing revenue, mortgage banking net revenue, net securities gains or losses and other noninterest income. Noninterest expense includes personnel costs, technology and communication costs, net occupancy expense, card and processing expense, equipment expense and other noninterest expense.

Acquisition of MB Financial, Inc.

On March 22, 2019, Fifth Third Bancorp completed its acquisition of MB Financial, Inc. in a stock and cash transaction valued at approximately $3.6 billion. MB Financial, Inc. was headquartered in Chicago, Illinois with reported assets of approximately $20 billion and 86 branches (91 locations) as of December 31, 2018 and was the holding company of MB Financial Bank, N.A. The acquisition resulted in a combined company with a larger Chicago market presence and core deposit funding base while also building scale in a strategically important market.

Under the terms of the agreement, the Bancorp acquired 100% of the common stock of MB Financial, Inc. In exchange, common shareholders of MB Financial, Inc. received 1.45 shares of Fifth Third Bancorp common stock and $5.54 in cash for each share of MB Financial, Inc. common stock, for a total value per share of $42.49, based on the $25.48 closing price of Fifth Third Bancorp’s common stock on March 21, 2019. Upon closing of the transaction, MB Financial, Inc. became a subsidiary of the Bancorp. However, MB Financial, Inc.’s 6.00% non-cumulative Series C perpetual preferred stock with a fair value of $197 million remainsremained outstanding and iswas recognized as a noncontrolling interest on the Condensed Consolidated Balance Sheets. Through its ownership of all of the common stock, the Bancorp controlscontrolled 95% of the voting equity interests in MB Financial, Inc. with the remainder attributable to the preferred shareholders’ noncontrolling interest.

On June 24, 2019, MB Financial, Inc. entered into an Agreement and Plan of Merger with the Bancorp to provide for the merger of MB Financial, Inc. with and into the Bancorp, with the Bancorp as the surviving corporation. MB Financial, Inc. has scheduled aA special meeting of its stockholders on August 23, 2019 at which the holders of MB Financial, Inc.’s common stock and preferred stock, voting together as a single class, will be asked to approve the merger. In the merger, each outstanding share of MB Financial, Inc.’s preferred stock would be

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stockholders was held on August 23, 2019 at which the holders of MB Financial, Inc.’s common stock and preferred stock, voting together as a single class, approved the merger. In the merger, each outstanding share of MB Financial, Inc.’s preferred stock was converted into the right to receive one share of a newly created series of preferred stock of the Bancorp having substantially the same terms as MB Financial, Inc. preferred stock. See the Preferred Stock Offerings section for additional information.

The acquisition of MB Financial, Inc. constituted a business combination and was accounted for under the acquisition method of accounting. Accordingly, the assets acquired, liabilities assumed and noncontrolling interest recognized were recorded at their estimated fair values as of the acquisition date. These fair value estimates are considered preliminary as of JuneSeptember 30, 2019. Fair value estimates, including loans and leases, intangible assets, deposits and goodwill, are subject to change for up to one year after the acquisition date as additional information becomes available. For more information on the acquisition of MB Financial, Inc., refer to Note 3 of the Notes to Condensed Consolidated Financial Statements.

Bank Merger

On May 3, 2019, MB Financial Bank, N.A., merged with and into Fifth Third Bank, with Fifth Third Bank as the surviving entity. Fifth Third Bank is a subsidiary of Fifth Third Bancorp. For more information on the acquisition of MB Financial, Inc., refer to Note 3 of the Notes to Condensed Consolidated Financial Statements.

Holding Company Merger

On August 26, 2019, MB Financial, Inc. merged with and into Fifth Third Bancorp, with Fifth Third Bancorp as the surviving entity. For more information on the acquisition of MB Financial, Inc., refer to Note 3 of the Notes to Condensed Consolidated Financial Statements.

Worldpay Holding, LLC Transactions

On March 18, 2019, the Bancorp exchanged its remaining 10,252,826 Class B Units of Worldpay Holding, LLC for 10,252,826 shares of Class A common stock of Worldpay, Inc., and subsequently sold those shares. As a result of this transaction, the Bancorp recognized a gain of $562 million in other noninterest income during the first quarter of 2019. As a result of the sale, the Bancorp no longer beneficially owns any of Worldpay, Inc.’s equity securities.

Accelerated Share Repurchase Transactions

During the sixnine months ended JuneSeptember 30, 2019, the Bancorp entered into and settled accelerated share repurchase transactions. As part of these transactions, the Bancorp entered into forward contracts in which the final number of shares delivered at settlement was based generally on a discount to the average daily volume weighted-average price of the Bancorp’s common stock during the term of these repurchase agreements. For more information on the accelerated share repurchase program, refer to Note 18 of the Notes to Condensed Consolidated Financial Statements. For a summary of the Bancorp’s accelerated share repurchase transactions that were entered into and settled during the sixnine months ended JuneSeptember 30, 2019, refer to Table 2.

(a)This accelerated share repurchase transaction consists of two supplemental confirmations each with a notional amount of $456.5 million.

(b)This accelerated share repurchase transaction consisted of two supplemental confirmations each with a notional amount of $100 million.

Open Market Share Repurchase Transactions

Between July 29, 2019 and July 30, 2019, the Bancorp entered into repurchase transactions of 1,667,735 shares, or $50 million, of its outstanding common stock through the open market, which settled between July 31, 2019 and August 1, 2019. For more information on the open market share repurchase program, refer to Note 18 of the Notes to Condensed Consolidated Financial Statements.

Preferred Stock Offerings

On August 26, 2019, the Bancorp issued 200,000 shares of 6.00% non-cumulative perpetual Class B preferred stock, Series A. Each preferred share has a $1,000 liquidation preference. These shares were issued to the holders of MB Financial, Inc.’s 6.00% non-cumulative perpetual preferred stock, Series C, in conjunction with the merger of MB Financial, Inc. with and into Fifth Third Bancorp. This transaction resulted in the elimination of the noncontrolling interest in MB Financial, Inc. which was previously reported in the Bancorp’s Condensed Consolidated Financial Statements. The newly issued shares of Class B preferred stock, Series A were recognized by the Bancorp at the carrying value previously assigned to the MB Financial, Inc. Series C preferred stock prior to the transaction.

On September 17, 2019, the Bancorp issued in a registered public offering 10,000,000 depositary shares, representing 10,000 shares of 4.95% non-cumulative perpetual preferred stock, Series K, for net proceeds of approximately $242 million. Each preferred share has a $25,000 liquidation preference. Subject to any required regulatory approval, the Bancorp may redeem the Series K preferred shares at its option (i) in whole or in part, on any dividend payment date on or after September 30, 2024 and (ii) in whole, but not in part, at any time following a

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regulatory capital event. The Series K preferred shares are not convertible into Bancorp common shares or any other securities. For more information on the open market share repurchase program, refer to Note 18 of the Notes to Condensed Consolidated Financial Statements.

Senior Notes Offering

On January 25, 2019, the Bancorp issued and sold $1.5 billion of 3.65% senior fixed-rate notes, with a maturity of five years, due on January 25, 2024. These notes will be redeemable by the Bancorp, in whole or in part, on or after the date that is 30 days prior to the maturity date at a redemption price equal to 100% of the principal amount of the notes to be redeemed plus accrued and unpaid interest up to, but excluding, the redemption date.

On February 1, 2019, Fifth Third Bank issued and sold, under its bank notes program, $300 million of senior floating-rate notes, with a maturity of three years, due on February 1, 2022. Interest on the floating-rate notes is 3-month LIBOR plus 64 bps. These notes will be redeemable by Fifth Third Bank, in whole or in part, on or after the date that is 30 days prior to the maturity date at a redemption price equal to 100% of the principal amount of the notes to be redeemed plus accrued and unpaid interest up to, but excluding, the redemption date.

Automobile Loan Securitization

In a securitization transaction that occurred in May of 2019, the Bancorp transferred $1.43 billion in aggregate automobile loans to a bankruptcy remote trust which subsequently issued approximately $1.37 billion of asset-backed notes, of which approximately $68 million of the asset-backed notes were retained by the Bancorp, resulting in approximately $1.3 billion of outstanding notes included in long-term debt in the Condensed Consolidated Balance Sheets. Additionally, the bankruptcy remote trust was deemed to be a VIE and the Bancorp, as the primary beneficiary, consolidated the VIE. The third-party holders of the asset-backed notes do not have recourse to the general assets of the Bancorp.

GS Holdings and GreenSky, Inc. Transactions

In May 2018, GreenSky, Inc. launched an IPO and issued 38 million shares of Class A common stock for a valuation of $23 per share. In connection with this IPO, the Bancorp’s investment in GreenSky, LLC, which was comprised of 252,550 membership units, was converted to 2,525,498 units of the newly formed GreenSky Holdings, LLC (“GS Holdings”), representing a 1.4% interest in GS Holdings. The Bancorp’s units in GS Holdings were exchangeable on a one-to-one basis for Class A common stock or cash.

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During the first quarter of 2019, all of the Bancorp’s units in GS Holdings were converted for Class A common stock on a one-to-one basis and the Bancorp sold 85,000 shares for an immaterial gain that was recognized in the Condensed Consolidated Statements of Income. During the second quarter of 2019, the Bancorp sold its remaining shares of Class A common stock for a gain of approximately $1 million that was recognized in the Condensed Consolidated Statements of Income. As a result of the sale in the second quarter of 2019, the Bancorp no longer beneficially owns any of GreenSky, Inc.’s equity securities.

ApplicationApproval to Convert to a National Bank Charter

On May 30,September 10, 2019, theFifth Third Bancorp announced that itFifth Third Bank had filed an application withreceived approval from the OCC to convert from an Ohio state-chartered bank to a national bankbank. The conversion is intended to better align regulatory supervision with its expanding national business model by streamlining its operations under one uniform set of laws and regulations. The application is subjectBank expects to regulatory approval.convert to a national bank charter on or about November 14, 2019.

LIBOR Transition

In July 2017, the Chief Executive of the United Kingdom Financial Conduct Authority (FCA), which regulates LIBOR, announced that FCA will stop persuading or compelling banks to submit rates for the calculation of LIBOR to the administrator of LIBOR after 2021. Since then, central banks around the world, including the Federal Reserve, have commissioned working groups of market participants and official sector representatives with the goal of finding suitable replacements for LIBOR. The Bancorp has substantial exposure to LIBOR-based products within its commercial lending, commercial deposits, business banking, consumer mortgage, private banking, and capital markets lines of business. It is expected that a transition away from the widespread use of LIBOR to alternative reference rates will occur over the course of the next few years. Although the full impact of such reforms and actions remains unclear, the Bancorp is preparing to transition from LIBOR to these alternative reference rates.

The Bancorp’s transition plan includes a number of key work streams, including continued engagement with central bank and industry working groups and regulators, active client engagement, comprehensive review of legacy documentation, internal operational readiness, and risk management, among other things, to facilitate the transition to alternative reference rates.

The transition away from LIBOR is expected to be gradual and complicated. There remain a number of unknown factors regarding the transition from LIBOR that could impact the Bancorp’s business, including, for example, the pace of the transition to replacement rates, including industry coalescence around an alternative benchmark, our ability to identify exposures to LIBOR across our business lines, the specific terms and parameters for any potential alternative reference rates, the prices of and the liquidity of trading markets for products based on the alternative reference rates, our ability to transition to and develop appropriate systems and analytics for one or more alternative reference rates, our ability to maintain contractual continuity and our ability to identify and remediate any operational issues. For a further discussion of the various risks the Bancorp faces in connection with the expected replacement of LIBOR on its operations, see “Risk Factors—Market Risks—The replacement of LIBOR could adversely affect Fifth Third’s revenue or expenses and the value of those assets or obligations.” in the Bancorp’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018.

Earnings Summary

The Bancorp’s net income available to common shareholders for the second quarter of 2019 was $427 million, or $0.57 per diluted share, which was net of $26 million in preferred stock dividends. The Bancorp’s net income available to common shareholders for the second quarter of 2018 was $579 million, or $0.82 per diluted share, which was net of $23 million in preferred stock dividends. The Bancorp’s net income available to common shareholders for the six months ended June 30, 2019 was $1.2 billion, or $1.66 per diluted share, which was net of $41 million in preferred stock dividends. For the six months ended June 30, 2018, the Bancorp’s net income available to common shareholders was $1.3 billion, or $1.79 per diluted share, which was net of $38 million in preferred stock dividends.

Net interest income on an FTE basis (non-GAAP) was $1.3 billionLegislative and $2.3 billion for the three and six months ended June 30, 2019, respectively, an increase of $226 million and $313 million compared to the same periods in the prior year. Net interest income was positively impacted by increases in average commercial and industrial loans of $9.9 billion and $7.1 billion, respectively, and average commercial mortgage loans of $4.1 billion and $2.5 billion, respectively, for the three and six months ended June 30, 2019 compared to the same periods in the prior year. Net interest income also benefited from increases in yields on average loans and leases of 54 bps and 58 bps for the three and six months ended June 30, 2019, respectively, compared to the same periods in the prior year. Additionally, net interest income was positively impacted by the decisions of the FOMC to raise the target range of the federal funds rate 25 bps in June 2018, September 2018 and December 2018. These positive impacts were partially offset by increases in both the rates paid on and balances of average interest-bearing core deposits and average long-term debt for both the three and six months ended June 30, 2019 compared to the same periods in the prior year. Net interest income for the three and six months ended June 30, 2019 included $18 million and $20 million, respectively, of amortization and accretion of premiums and discounts on acquired loans and assumed deposits and long-term debt from the MB Financial, Inc. acquisition. Net interest margin on an FTE basis (non-GAAP) was 3.37% and 3.33% for the three and six months ended June 30, 2019, respectively, compared to 3.21% and 3.19% for the three and six months ended June 30, 2018, respectively.

Noninterest income decreased $83 million for the three months ended June 30, 2019 compared to the same period in the prior year primarily due to a decrease in other noninterest income, partially offset by increases in corporate banking revenue and wealth and asset management revenue. Other noninterest income decreased $157 million during the three months ended June 30, 2019 compared to the same period in the prior year primarily due to the gain on sale of Worldpay, Inc. shares recognized during the second quarter of 2018. This reduction was partially offset by a decrease in the net losses on disposition and impairment of bank premises and equipment and an increase in operating lease income. Corporate banking revenue increased $17 million for the three months ended June 30, 2019 compared to the same period in the prior year primarily driven by an increase in lease-related services revenue of $19 million driven by the acquisition of MB Financial, Inc., partially offset by a decrease in institutional sales of $5 million. Wealth and asset management revenue increased $14 million for the threeRegulatory Developments

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On October 31, 2018, the Board of Governors of the FRB released a series of regulatory proposals to implement the Economic Growth, Regulatory Relief, and Consumer Protection Act (“Reform Act”). Among the proposals, the Board of Governors, joined by the Department of Treasury, OCC and the FDIC proposed to remove the application of the LCR regulations and the NSFR from certain BHCs that qualify under the proposal as “Category IV” institutions, primarily those BHCs with consolidated assets between $100 billion and $250 billion, including Fifth Third Bancorp. On October 10, 2019, the Board of Governors of the FRB announced it finalized the rules that tailor its regulations for banks to more closely match their risk profile. Fifth Third, as a Category IV institution, will no longer be subject to the LCR regulations and the NSFR regulations. The final rules are effective December 31, 2019.

Earnings Summary

The Bancorp’s net income available to common shareholders for the third quarter of 2019 was $530 million, or $0.71 per diluted share, which was net of $19 million in preferred stock dividends. The Bancorp’s net income available to common shareholders for the third quarter of 2018 was $421 million, or $0.61 per diluted share, which was net of $15 million in preferred stock dividends. The Bancorp’s net income available to common shareholders for the nine months ended JuneSeptember 30, 2019 was $1.7 billion, or $2.37 per diluted share, which was net of $60 million in preferred stock dividends. For the nine months ended September 30, 2018, the Bancorp’s net income available to common shareholders was $1.7 billion, or $2.41 per diluted share, which was net of $52 million in preferred stock dividends.

Net interest income on an FTE basis (non-GAAP) was $1.2 billion and $3.6 billion for the three and nine months ended September 30, 2019, respectively, an increase of $199 million and $511 million compared to the same periods in the prior year. Net interest income was positively impacted by increases in average commercial and industrial loans of $8.8 billion and $7.6 billion, respectively, and average commercial mortgage loans of $4.0 billion and $3.0 billion, respectively, for the three and nine months ended September 30, 2019 compared to the same periodperiods in the prior year primarily dueyear. Net interest income also benefited from increases in yields on average loans and leases of 34 bps and 50 bps for the three and nine months ended September 30, 2019, respectively, compared to an increase of $11 millionthe same periods in private client service fees driventhe prior year. Additionally, for the three and nine months ended September 30, 2019, net interest income was positively impacted by the benefitSeptember 2018 and December 2018 decisions of the FOMC to raise the target range of the federal funds rate partially offset by the negative impact of the August 2019 and September 2019 decisions of the FOMC to lower the target range of the federal funds rate. These positive impacts were partially offset by increases in both the rates paid on and balances of average interest-bearing core deposits and average long-term debt as well as increases in average certificates $100,000 and over for both the three and nine months ended September 30, 2019 compared to the same periods in the prior year. Net interest income for the three and nine months ended September 30, 2019 included $28 million and $47 million, respectively, of amortization and accretion of premiums and discounts on acquired loans and leases and assumed deposits and long-term debt from acquisitions since Juneacquisitions. Net interest margin on an FTE basis (non-GAAP) was 3.32% for both the three and nine months ended September 30, 2018.2019 compared to 3.23% and 3.20% for the three and nine months ended September 30, 2018, respectively.

Noninterest income increased $109$177 million for the sixthree months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily due to increases in corporate banking revenue, and wealth and asset managementmortgage banking net revenue partially offset by a decrease inand other noninterest income.Corporate banking revenue increased $41$68 million for the sixthree months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily driven by increases in lease-related services revenue, lease remarketing fees, institutional sales revenue and business lending fees of $20$19 million, $13$19 million, $17 million and $9$8 million, respectively. The increase in lease-related services revenue for the six months ended June 30, 2019 was driven by the acquisition of MB Financial, Inc. Wealth and asset managementMortgage banking net revenue increased $13$46 million for the sixthree months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily driven by a $39 million increase in origination fees and gains on loan sales due to the lower interest rate environment. Other noninterest income increased $25 million during the three months ended September 30, 2019 compared to the same period in the prior year primarily due to an increase of $14 million in private client service fees driven by the benefit from acquisitions since June 30, 2018. Other noninterest income decreased $24 million during the six months ended June 30, 2019 compared to the same period in the prior year primarily due to the gain related to Vantiv, Inc.’s acquisition of Worldpay Group plc. recognized during the first quarter of 2018 and a decrease in private equity investment income. These reductions were partially offset by an increase in gains on the sale of Worldpay Inc. shares driven by the Bancorp’s sale of shares during the first quarter of 2019, an increase in operating lease income and a decrease in the loss on the swap associated with the sale of Visa, Inc. Class B Shares. These impacts were partially offset by an increase in the net losses on disposition and impairment of bank premises and equipment.

Noninterest income increased $286 million for the nine months ended September 30, 2019 compared to the same period in the prior year primarily due to increases in corporate banking revenue and mortgage banking net revenue. Corporate banking revenue increased $109 million for the nine months ended September 30, 2019 compared to the same periods in the prior year primarily driven by increases in lease-related services revenue, lease remarketing fees, institutional sales revenue and business lending fees of $39 million, $32 million, $21 million and $17 million, respectively. The increase in lease-related services revenue was driven by the acquisition of MB Financial, Inc. Mortgage banking net revenue increased $56 million for the nine months ended September 30, 2019 compared to the same periods in the prior year primarily driven by a $49 million increase in origination fees and gains on loan sales due to the lower interest rate environment.

Noninterest expense increased $242$187 million for the three months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily due to increases in personnel costs, technology and communications expense and other noninterest expense. The increase in noninterest expense included the recognition of $109$28 million of merger-related expenses related to the MB Financial, Inc. acquisition for the three months ended JuneSeptember 30, 2019 compared to $2$1 million in the same period in the prior year. Personnel costs increased $92$81 million for the three months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily driven by $41$14 million in merger-related expenses, the addition of personnel costs from the acquisition of MB Financial, Inc. and higher deferred compensation expense. Technology and communications expense increased $69$29 million for the three months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily driven by $49$8 million in merger-related expenses for the three months ended September 30, 2019 as well as increased investment in contemporizing information technology architecture, mitigating information security risks and growth initiatives. Other noninterest expense increased $60$59 million for the three months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily due to the recognition of $11 million of merger-related expenses related to the acquisition of MB Financial, Inc. as well as increases in losses and adjustments, operating lease expense, intangible amortization expense and marketingloan and lease expense, partially offset by a decrease in FDIC insurance and other taxes.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)

Noninterest expense increased $330$515 million for the sixnine months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily due to increases in personnel costs, technology and communications expense and other noninterest expense. The increase in noninterest expense included the recognition of $185$213 million of merger-related expenses related to the MB Financial, Inc. acquisition for the nine months ended September 30, 2019 compared to $2$3 million in the same period in the prior year. Personnel costs increased $145$234 million for the sixnine months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily driven by $75$88 million in merger-related expenses, the addition of personnel costs from the acquisition of MB Financial, Inc. and higher deferred compensation expense. Technology and communications expense increased $84$113 million for the sixnine months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily driven by $60$68 million in merger-related expenses as well as increased investment in contemporizing information technology architecture, mitigating information security risks and growth initiatives. Other noninterest expense increased $80$128 million for the sixnine months ended JuneSeptember 30, 2019 compared to the same period in the prior year primarily due to the recognition of $42$45 million of merger-related expenses related to the acquisition of MB Financial, Inc.as well as increases in losses and adjustments, operating lease expense, intangible amortization expense and marketingloan and lease expense, partially offset by a decrease in FDIC insurance and other taxes.

For more information on net interest income, noninterest income and noninterest expense refer to the Statements of Income Analysis section of MD&A.

Credit Summary

The provision for credit losses was $85$134 million and $175$310 million for the three and sixnine months ended JuneSeptember 30, 2019, respectively, compared to $14$84 million and $27$111 million for the comparable periods in 2018. Net losses charged-off as a percent of average portfolio loans and leases decreased to 0.29%were 0.36% and 0.30% for the three months ended September 30, 2019 and 2018, respectively, and 0.32% and 0.36% during the three and sixnine months ended JuneSeptember 30, 2019 respectively, compared to 0.41% and 0.38% during the same periods in the prior year.2018, respectively. At JuneSeptember 30, 2019, nonperforming portfolio assets as a percent of portfolio loans and leases and OREO increased to 0.51%0.47% compared to 0.41% at December 31, 2018. For further discussion on credit quality refer to the Credit Risk Management subsection of the Risk Management section of MD&A.

Capital Summary

The Bancorp’s capital ratios exceed the “well-capitalized” guidelines as defined by the PCA requirements of the U.S. banking agencies. As of JuneSeptember 30, 2019, as calculated under the Basel III standardized approach, the CET1 capital ratio was 9.57%9.56%, the Tier I risk-based capital ratio was 10.62%10.81%, the Total risk-based capital ratio was 13.53%13.68% and the Tier I leverage ratio was 9.24%9.36%.

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NON-GAAP FINANCIAL MEASURES

The following are non-GAAP measures which provide useful insight to the reader of the Condensed Consolidated Financial Statements but should be supplemental to primary U.S. GAAP measures and should not be read in isolation or relied upon as a substitute for the primary U.S. GAAP measures.

The FTE basis adjusts for the tax-favored status of income from certain loans and securities held by the Bancorp that are not taxable for federal income tax purposes. The Bancorp believes this presentation to be the preferred industry measurement of net interest income as it provides a relevant comparison between taxable and non-taxable amounts.

The following table reconciles the non-GAAP financial measures of net interest income on an FTE basis, interest income on an FTE basis, net interest margin, net interest rate spread and the efficiency ratio to U.S. GAAP:

The Bancorp believes return on average tangible common equity is an important measure for comparative purposes with other financial institutions, but is not defined under U.S. GAAP, and therefore is considered a non-GAAP financial measure. This measure is useful for evaluating the performance of a business as it calculates the return available to common shareholders without the impact of intangible assets and their related amortization. Additionally, theThe Bancorp also measures average tangible common equity excluding AOCI. The Bancorp believes this is a useful return measure as it calculates the return available to common shareholders without the impact of intangible assets, their related amortization as well as the volatility primarily associated with fluctuations of unrealized gains and losses on the Bancorp’s available-for-sale debt and other securities and cash flow hedge derivatives.